TMB may hit IPO market with Rs 1,000-1,300 cr issue by Nov

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April 28, 2021 3:30 AM

“During the current fiscal, it would add 66 branches and the rest in the next fiscal. Though TMB does not have required licences to open new branches as of now, it had already identified 28 locations to open branches and have done some spade work,” he said.

On the strategies for the FY 2021-22, Moorthy said there would be increased thrust on consistent CASA growth, credit growth with specific focus on retail lending. The bank will leverage technology for business development and to enhance delivery efficiencies of all banking services.On the strategies for the FY 2021-22, Moorthy said there would be increased thrust on consistent CASA growth, credit growth with specific focus on retail lending. The bank will leverage technology for business development and to enhance delivery efficiencies of all banking services.

Private sector lender Tamilnad Mercantile Bank (TMB) is planning to raise Rs1,000 to 1,300 crore through its planned initial public offering (IPO), which is likely to hit the market by November. The bank, among the few still unlisted, will offer to sell shares by the existing investors apart from fresh issue of shares.

K V Rama Moorthy, MD & CEO of Tamilnad Mercantile Bank, told media persons through virtual mode on Tuesday that work had been progressing to file the paper with the Securities and Exchange Board of India (Sebi).

“We will be filing the draft prospectus with the market regulator within the next eight to 10 weeks. Post-issue, the dilution will be about 10%. It might be a mix of offer for sale (OFS) and fresh issue of shares,” he said. Refusing to divulge the finer details regarding the issue, Moorthy said it was too early to talk about the offer price, and the ratio between OFS and fresh issue. The bank would use the proceeds to expand its branch network from the current 509 to 650.

“During the current fiscal, it would add 66 branches and the rest in the next fiscal. Though TMB does not have required licences to open new branches as of now, it had already identified 28 locations to open branches and have done some spade work,” he said.
On the strategies for the FY 2021-22, Moorthy said there would be increased thrust on consistent CASA growth, credit growth with specific focus on retail lending. The bank will leverage technology for business development and to enhance delivery efficiencies of all banking services.

The Tuticorin-based, old-economy bank, which is into its centenary year, on Tuesday posted 48% growth in its net profit for the fiscal ended March 31, 2021, to Rs 603 crore, owing to multiple factors such as lesser provisioning, increase in advances and revision of interest rates, among others. For FY21, the net interest income (NII) has increased to Rs 1,537.53 crore as against Rs 1,319.51 crore, with a growth rate of 16.52%. The interest income of the bank stood at Rs 3,609.05 crore with a 4.12% increase from previous year’s figure of Rs 3,466.11 crore.

The gross NPA as a percentage to total advances reduced to 3.44% (3.62%) and net NPA stood at 1.98% (1.80%). The NPA and restructured advances of the bank was only at 3.93%, he said. Provision coverage ratio was at 79.53% (80.75%) and the bank has made additional standard asset provision (Covid- II wave) of Rs 50 crore.

The capital adequacy ratio (Basel III) of the bank increased to 18.94% (16.74%). The bank’s deposits increased to Rs 40,970.42 crore (Rs 36,825.03 crore) with a growth rate of 11.27% whereas the average growth was 9.39%. The CASA position has increased to Rs 11,685.27 crore with a growth rate of 22.77% and the average growth was at 18.37%. The advance level of the bank has increased to Rs 31,541.81 crore with a growth rate of 11.71% and the average growth was at 9.98%.

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