Money & Banking

Cosmos Bank to raise Rs 119 crore through long-term deposits

Our Bureau Mumbai | Updated on March 09, 2011 Published on March 09, 2011

Pune-headquartered Cosmos Co-operative Bank is looking to raise Rs 119 crore through long-term (subordinated) deposits scheme (LTDS). Under the LTDS, the bank is offering 10 per cent fixed interest rate interest for general depositors and 10.25 per cent for senior citizens. The interest is payable at quarterly rests, said a press release issued by the bank.

The Reserve Bank of India permits only viable and financially strong urban co-operative banks to raise long-term deposits.

The LTDS will have tenure of up to five years and six months (up to 66 months). The minimum deposit size is Rs 10,000 and thereafter in multiples of Rs 1,000. Nomination facility is available to depositors.

Insurance cover

The proposed issue of LTDS is for augmenting Lower Tier II capital of the bank. This scheme is not covered under DICGC Insurance Cover and will not have the facility of overdraft or premature withdrawal. With prior permission of the RBI, the bank may exercise the call option, that is, repaying the deposit before the date of maturity, the release said.

Last year, the bank had raised Rs 100 crore through a similar scheme. Two other co-operative banks, Saraswat Co-operative Bank and Shamrao Vithal Co-operative Bank, are also looking to raise about Rs 200 crore through LTSDs by March-end.

While Saraswat Co-operative Bank plans to mobilise about Rs 160 crore by offering 9.50 per cent interest, Shamrao Vithal Co-operative Bank is looking to raise Rs 50 crore by offering 10 per cent interest.

Published on March 09, 2011
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