Financial Daily from THE HINDU group of publications
Wednesday, Nov 16, 2005
Financial Daily from THE HINDU group of publications Wednesday, Nov 16, 2005 |
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Money & Banking
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Public Sector Banks Indian Bank's capital restructure plan under study: Chidambaram Our Bureau
ENTERPRISE PORTAL: The Union Finance Minister, Mr P. Chidambaram, flanked by Mr A.K. Shukla (left), Chairman, LIC, and Mr K. Sridhar, Managing Director, at the launch of LIC's e-Portal in Chennai on Tuesday. — Bijoy Ghosh
Chennai , Nov. 15 THE Finance Minister, Mr P. Chidambaram, on Tuesday said that Indian Bank had come up with a proposal to restructure its capital and he had promised the bank to consider it. "It is a much stronger bank today and is performing very well," said Mr Chidambaram.Mr Chidambaram visited the headquarters of the bank and reviewed its functioning. The bank had on its books accumulated losses of Rs 3,830 crore and a capital of Rs 4,594 crore. The management of the bank has suggested to the government that the accumulated losses be adjusted against the capital. Indian Bank has been making profits but statutory appropriations have left nothing to reduce the accumulated losses. Last year, the bank earned a net profit of Rs 408 crore, but all of that had to be put into Statutory Reserve, Capital Reserve and Investment Fluctuation Reserve. If the government allows the bank to wipe off its held-over losses and write-down the capital by the same amount (as it has done for many other banks), Indian Bank will be able to present a clean balance sheet to investors. Then, the bank could come out with its initial public offering. Launches LIC's e-Portal: Mr Chidambaram also formally launched Life Insurance Corporation's e-Portal — an enriched Web site through which customers and agents could transact business. For instance, a customer could login and make his premium payments and receive a digitally-signed receipt through email. It includes other features such as agent locator and also doctor locator. For agents, it offers features such as information on premium dues and calculation of commissions. The portal is a part of LIC's information technology projects, for which it has proposed to spend Rs 120 crore this year. Last year, LIC spent Rs 100 crore on information technology initiatives. Bharat Overseas' 100th branch: The Finance Minister also inaugurated the 100th branch of Bharat Overseas Bank Ltd. Speaking on the occasion, he said that while the bank was a strong, small bank, in future survival of banks would depend upon their size.
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