Uco Bank Mops Up Rs 300 Cr Via Bonds

Kolkata, March 24 | Updated: Mar 25 2004, 05:30am hrs
Kolkata-based public sector commercial bank, Uco Bank, on Wednesday announced that it has successfully raised Rs 300 crore from the capital market through its private placement issue of unsecured redeemable, non-convertible, subordinated bonds.

According to a press statement issued by the bank, the issue, which opened on March 22, 2004, and was scheduled to close on March 30, 2004, was oversubscribed and hence was closed before tenure on Wednesday. AK Capital Services Ltd acted as arranger to the issue.

The original size of the issue was Rs 300 crore including option to retain oversubscription of Rs 50 crore. The bonds were rated AA by Crisil and have a tenor of 111 months bearing coupon rate of 5.95 per cent payable annually.

The private placement of bonds was made to augment the Tier-II capital of the bank and further strengthen the capital adequacy ratio of the bank as also for enhancement of the long-term resources of the bank, the press statement said.

It is learnt that Uco Bank currently has a total business of over Rs 55,000 crore, with a domestic network of 1,705 branches, 172 extension counters, 10 service branches and four overseas branches in Singapore and Hong Kong. The capital adequacy ratio of the bank as on December 31, 2003, stood at 13.27 per cent, which is well above the minimum level of nine per cent prescribed by the Reserve Bank of India.

For the half-year to September 30, 2003, the bank reported an operating profit of Rs 490.41 crore and a net profit of Rs 292.43 crore. The Uco Bank management has claimed that the deposits and advances of the bank has grown by a CAGR of 17.85 per cent and 23.53 per cent, respectively during the last five years. The bank came out with its maiden Rs 240 crore equity initial public offering at a premium in September 2003, which was oversubscribed by 17.04 times.