CoimbatoreMay 22Central Bank of India has filed the draft red herring prospectus with SEBI for its proposed public issue.
The bank is offering through the issue 80,000,000 equity shares of Rs 10 each through the book building route. This includes 4,000,000 shares reserved for the eligible employees.
Explaining the objective for the issue, Central Bank of India has stated in the draft prospectus that the RBI required the banks to maintain a minimum CRAR (capital to risk-weighted assets ratio) of 9 per cent, at least 50 per cent of which should consist of tier-I capital. As on March 31, 2007, the total capital adequacy ratio of the bank was 10.40 per cent and its tier-I capital adequacy ratio was 6.32 per cent compared with 11.03 per cent and 7.19 per cent respectively as on March 31, 2006.
Central Bank said that it needed funds to augment its capital base to meet the future capital requirements arising out of the implementation of the Basel II standards and the growth in its assets, essentially its loan and investment portfolio, due to the growth of the country's economy and for other general corporate purposes.
The proposed public issue would constitute 24.68 per cent of the pre-issue and 19.80 per cent of the post-issue fully diluted paid-up equity capital of the bank.