The Hindu Business Line : ‘BoM to seek more capital when required’

Coimbatore, April 1 Though the requirement for additional capital is not immediate, Bank of Maharashtra would consider the option when the market improves, its Executive Director Mr M.G. Sanghvi said.

“We have adequate reserves at present and our capital adequacy at over 11 per cent is quite comfortable. However, we have applied for Rs 1,500 crore perpetual preference share issue. We are expecting to receive Rs 500 crore in the first tranche during the first quarter of the 2009-10 fiscal. This would further strengthen our CAR,” he told Business Line.

Mr Sanghvi was in the city to inaugurate the bank’s 1,421st branch, which incidentally is its second branch here.

“We will be using this towards our expansion plans,” he said.

The bank is planning to open 100 new branches, hire 500 officers and clerks in 2009-10. “We are targeting a business of Rs 1,10,000 crore against Rs 81,000 crore achieved during the current fiscal,” Mr Sanghvi said.

Growth plans

On its growth strategy, he said “Our aim is not on big margin, but in reaching out to the unbanked. Our growth will be assured only if our customers grow.”

The bank has been proactive in identifying and reaching out to customers in distress by providing additional funds, restructuring their advances and relaxing their repayment period, he said and added that such measures would have no major impact on its bottom-line.

“The credit restructuring exercise is on. So far, we have restructured close to 4,000 accounts. Some more are under process and we hope to clear these by June. It is not just the corporates and SMEs who seek to restructure their debts. We have received enquiries from home loan borrowers and the retail segment as well.

“Our credit growth rate at 20 per cent is higher than our deposit growth rate (at 17 per cent),” Mr Sanghvi said.

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