Uco Bank looks to raise Rs 325 cr
Government-owned Uco Bank has started talking to institutional investors afresh for raising Rs 325 crore through a preferential allotment of equity shares by September.
By ET Bureau |
KOLKATA: Government-owned Uco Bank has started talking to institutional investors afresh for raising Rs 325 crore through a preferential allotment of equity shares by September. The bank appears to be exploring the option more intensely like never before since the possibility to use the follow-on public issue route for funds appears to be remote before the October-December quarter.
According to Uco chairman and managing director SK Goel, the bank will require funds for its lending. ���We are confident of achieving a 20 per cent growth in lending in 2008-09 despite adverse market conditions. So, we plan to raise the fund before September,��� Mr Goel said here on Monday on the sidelines of a banking seminar organised by Federation of Indian Chamber of Commerce & Industry (Ficci).
Regulatory clearance for the preferential issue is already in place, the CMD said. Mr Goel said the bank took a Rs 130-crore mark-to-market (MTM) loss during the first quarter to June 30, 2008 on account of depreciation of its investments in bonds and equities. At the same period, it recovered Rs 180 crore from bad loan accounts. Uco will announce its first quarter results on July 26. Its first quarter net profit in 2007-08 was Rs 132.87 crore.
Meanwhile, the Kolkata-based bank is actively looking to set up a financial services company with an initial capital of Rs 25 crore to take care of some non-fund business. It plans to take a 49 per cent stake in the proposed company, while 26 per cent would be held by a foreign partner. For the balance 25 per cent, the bank is talking to several corporate houses. Multinational consultant Ernst & Young is assisting the bank for finding the partners. The proposed company will work in the areas of non-bank financial activities, loan syndication, selling of insurance and mutual fund products.
According to Uco chairman and managing director SK Goel, the bank will require funds for its lending. ���We are confident of achieving a 20 per cent growth in lending in 2008-09 despite adverse market conditions. So, we plan to raise the fund before September,��� Mr Goel said here on Monday on the sidelines of a banking seminar organised by Federation of Indian Chamber of Commerce & Industry (Ficci).
Regulatory clearance for the preferential issue is already in place, the CMD said. Mr Goel said the bank took a Rs 130-crore mark-to-market (MTM) loss during the first quarter to June 30, 2008 on account of depreciation of its investments in bonds and equities. At the same period, it recovered Rs 180 crore from bad loan accounts. Uco will announce its first quarter results on July 26. Its first quarter net profit in 2007-08 was Rs 132.87 crore.
Meanwhile, the Kolkata-based bank is actively looking to set up a financial services company with an initial capital of Rs 25 crore to take care of some non-fund business. It plans to take a 49 per cent stake in the proposed company, while 26 per cent would be held by a foreign partner. For the balance 25 per cent, the bank is talking to several corporate houses. Multinational consultant Ernst & Young is assisting the bank for finding the partners. The proposed company will work in the areas of non-bank financial activities, loan syndication, selling of insurance and mutual fund products.
Start a SIP with as low as ₹500 with ET Money App!
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
