The Hindu Business Line : Bank of Rajasthan expanding in South

Hyderabad, Oct. 19 Bank of Rajasthan, with a pre-dominantly North Indian focus, seeks to increase its presence in the Southern States with at least 10 new branches this fiscal.

The private sector bank, which has logged a business turnover of Rs 16, 664 crore for the half year ended September 2007, has lined up three branches each for Tamil Nadu and Andhra Pradesh and two each for Karnataka and Kerala.

At present, the Bank has 18 branches in the South and a total network of 462 (300 in Rajasthan alone) in 21 States. “We intend to achieve 100 per cent connectivity of the branches by March 2008,” said Mr B.M. Sharma, Managing Director and Chief Executive Officer (CEO).

Mr Sharma, who was here to open the bank’s new premises in Secunderabad, told newspersons that in the insurance sector the focus would be on marketing products through its existing tie-up with the LIC and United India Insurance Corporation. “Creating a separate insurance subsidiary is not in the offing now,” he said.

On augmenting the capital base from the present Rs 107 crore to Rs 200 crore, Mr Sharma said about Rs 27 crore would be raised through the 1:4 bonus share offer made in September. Similarly, a preferential offer has been planned.

Already investors are showing interest and talks are in an advanced stage, he added.

On equity dilution by the promoters (hold 44 per cent), as per the Reserve Bank of India norms, which stipulate that the bank bring it down to 10 per cent, Mr Sharma said: “We have given a road map to the RBI to bring down the promoters’ holding and would try to meet it”.

The promoters have already agreed to offload some percentage. Through the preferential offer, up to 4.9 per cent would be diluted. Other methods are also being tried out, Mr Sharma said.

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