The Hindu Business Line : Centurion Bank receives first phase of fund infusion

CENTURION Bank has received the first phase of funds through Sabre Capital Worldwide and other investors worth Rs 154 crore and will have the proposed Rs 65-crore rights issue before the end of this financial year as part of its second capital infusion.

The new Managing Director, Mr Shailendra Bhandari, previously CEO of Prudential ICICI Mutual Fund, is to take charge on Tuesday.

Elucidating on his strategy for growth, Mr Bhandari said, ``Retail as a part of our business already constitutes 75 per cent of total deposits and 73 per cent of assets and that will be our focus to grow. We will also explore the NRI market which we can into with Bank Muscat's merger with us.''

The board of the bank underwent some reconstitution today as it met to clear its third quarter results. Mr Bhandari has joined the board along with Mr Rana Talwar, CEO of Sabre Capital, who has taken charge as the Chairman. Mr Abdul Razak and Mr Sunder Jarg have also joined the board on behalf of Bank Muscat. Two directors, Mr Nigel Kenni of Sabre Capital and Mr Chee Jin Kiong of Keppel group, a long time investor in Centurion Bank, have stepped down from the board.

The infusion is also expected to take the capital adequacy of the bank to 7 per cent and then further on to 9 per cent following the second phase. As on December 31, 2003, the CAR was at 3.52 per cent, way below the regulatory requirement of 9 per cent, said Mr V. Janakiraman, outgoing CMD of the bank.

Incurs Rs 6.54-cr loss in Q3: With a drastic fall in treasury profits and provisioning, Centurion Bank has posted a net loss of Rs 6.54 crore for the third quarter ended December 31, 2003 against a net profit of Rs 3.10 crore in the corresponding period of the previous year.

While net interest income increased by 22.5 per cent to Rs 34.27 crore (Rs 27.98 crore), other income fell by 49.6 per cent to Rs 16.46 crore (Rs 32.70 crore).

Total income was down at Rs 101.04 crore (Rs 124.23 crore) and total expenditure decreased to Rs 97 crore (Rs 103.82 crore).

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