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Our Bureau

Mr M.B.N. Rao

Chennai , May 12

ENTHUSED by an upswing in performance, Indian Bank plans to tap the capital market in the current year, according to the bank's Chairman and Managing Director, Mr M.B.N. Rao.

Though the size and form of the issue was yet to be decided, the bank will tap the capital market in the first half of the current year. Its performance places it among the top banks in the country and the issue will command a significant premium, he said.

It is yet to decide whether it would tap the domestic or international markets or both. Currently, the bank's equity base is about Rs 737 crore and earnings per share about Rs 6, he said.

Rs 408-cr net: Announcing the bank's performance here on Thursday, Mr Rao said that for the year ended March 31, 2005, Indian Bank reported a net profit of Rs 408.49 crore on a gross business of Rs 53,689 crore. In 2003-04, the net profit was Rs 405.75 crore on gross business of Rs 45,379 crore.

Operating profit went up by 19 per cent to Rs 958.07 crore (Rs 802.46 crore) and business has grown by 18 per cent. Net interest income grew by 17 per cent to Rs 1,303.65 crore (Rs 1,117.06 crore); total deposits were up 14 per cent at Rs 34,808 crore (Rs 30,444 crore); and net advances went up by 30 per cent to Rs 18,380 crore (Rs 14,126 crore).

Gross non-performing assets (NPA) have dropped to 3.96 per cent (7.98 per cent) and net NPAs to 1.35 per cent (2.71 per cent). This was significant recovery for a bank that reported a gross NPA of close to 40 per cent and net NPA of 26 per cent in 1997, Mr Rao said.

Total agriculture credit was Rs 2,641.92 crore (Rs 1,379 crore).

The bank is exploiting specific niches with exclusive branches for lending to self-help groups and pensioners apart from specific schemes for salaried employees, entrepreneurs and students.

Indian Bank has been adopting core banking solution and plans to expand it to 500 branches by December and to 1,000 by March 2006. At present, 12 branches in five metros have introduced core banking.

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