Punjab & Sind Bank, the only unlisted nationalised bank, plans to come out with an initial public offer (IPO) by July which could fetch it about Rs 500 crore.
Speaking to FE, the bank?s executive director R K Anand said the bank is looking at raising
Rs 400-500 crore through the IPO. The bank has approached the government for money under its recapitalisation plan to the tune of Rs 600 crore, he said. The bank is expecting the government approval for the IPO which could hit the market either in the last week of June or early July,? said G S Vedi, chairman and managing director, Punjab & Sind Bank. ?We have proposed to issue four crore shares. The size of the issue is expected to be between Rs 400 and 500 crore,? he said. Currently, the government owns 100 % stake in the bank, he said after announcing 2009-10 results. The money raised through IPO would help the bank to grow the business and asset book, he said, adding the bank is also expecting capital infusion of Rs 500-700 crore from the government during this fiscal. The capital infusion would result in shoring up of its tier I capital above 8 %, he said, adding the tier I capital stands at 7.68% as of March end.
The government had restructured the equity structure of the bank in 2008. After the capital rejig, the equity capital of the bank came down to Rs 183.06 crore from Rs 743.06 crore earlier.
Net profit of the bank went up 18% to Rs 508.80 crore for fiscal year 2009-10, in comprasion with Rs 431 crore as achieved by the bank during the previous fiscal.