New Delhi, Dec. 30: The Sabre Fund has started a due diligence exercise at the sick Centurion Bank in which it is keen to pick up a controlling stake. The due diligence will be completed in four to six weeks’ time.
Sources in the Reserve Bank of India (RBI) said the fund is interested in acquiring a controlling stake in the bank which has reported a loss of Rs 162 crore last fiscal and has a lower capital adequacy ratio of 4.16 per cent against the RBI-stipulated 9 per cent.
Andhra Bank will also carry out a due-diligence exercise at Centurion Bank. However, sources said that the possibility of state-run Andhra Bank taking over Centurion Bank is slim.
“The chairman of Andhra Bank is on his way out which has put everything on the back burner. This leaves only the Rana Talwar-promoted Sabre Fund in the fray,” sources said.
Talwar, who resigned in November as chief executive officer of the UK-based Standard Chartered Bank, has since floated this fund along with few other members.
Sources said the bank requires a capital infusion of around Rs 150-200 crore.
“The merger proceedings will begin once they complete the diligence process,” the official said and added that the Reserve Bank of India will take care of the depositors’ interests.