The Hindu Business Line : Oriental Bank plans to raise more capital in July

The bank had in mid-April raised about Rs 500 crore of tier-II capital through bond offering at a cost of little less than 10 per cent. "We are yet to decide on whether the capital raising in July would be under tier-I or tier-II. We will raise more capital to fund business growth and also to meet Basel-II requirements," a senior official of the bank said.

Indications are that OBC may go in for an innovative perpetual debt instrument if the bank were to opt for tier-I capital. The Centre currently holds 51.09 per cent stake in OBC, leaving no headroom for the bank to go in for any pure equity offering under tier-I capital. OBC's capital adequacy as on March 31 this year stood at 12.5 per cent. Its paid-up capital was at Rs 250.54 crore. For the fiscal 2006-07, OBC reported a 4.24 per cent increase in net profit to Rs 580.81 crore from Rs 557.16 crore recorded in the previous year.

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