Business Daily from THE HINDU group of publications
Tuesday, May 01, 2007
ePaper
Business Daily from THE HINDU group of publications Tuesday, May 01, 2007 ePaper |
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Money & Banking
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Private Banks Markets - Foreign Institutional Investors M. Ramesh
Chennai April 30 The Dutch multilateral lending agency, FMO, might pick up some equity stake in City Union Bank (CUB), it is reliably learnt. Sources in investment banking circles told Business Line that FMO might invest about Rs 50 crore into the bank. When contacted, officials of the bank refused to confirm or deny this. However, a communication from the bank to the stock exchanges on Monday said that a board meeting is to be convened on Friday to consider "further issue of shares through preferential allotment." It may be recalled that L&T had wanted to pick up 9.99 per cent stake in the bank for Rs 45 crore, but the Reserve Bank of India had given permission, in March, only for 4.7 per cent. Consequently, CUB got a capital infusion of only Rs 20.38 crore.
Equity funding
At that time the bank's Executive Director, Mr N. Kamakodi, had told Business Line that while the bank's capital adequacy ratio was still at a comfortable level of 12.69 per cent, it would go in for a second round of equity funding for about Rs 400 crore — towards its objective of reaching a networth of Rs 1,000 crore by 2010 (from Rs 320 crore now). The bank aims to reach a total business of Rs 25,000 crore by 2010-11 (Rs 7,500 crore now), comprising Rs 15,000 crore of deposits and Rs 10,000 crore of advances. It wants its networth to reach Rs 1,000 crore by that year (Rs 320 crore, now) and see its market capitalisation go up to Rs 2,500 crore.
More Stories on : Private Banks | Foreign Institutional Investors
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