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Calcutta bank duo set for IPOs

Calcutta, May 19: Uco and UBI — two Calcutta–based banks that have seen better bottomlines in 2002-03 — will hit the market with maiden share offers in the second half of the current financial year. While Uco has decided to float an IPO of Rs 200 crore, UBI has lined up a Rs 50-crore flotation.

Uco has already gone ahead with its plans for the IPO, which the bank hopes to float in July-August. The bank has appointed SBI Caps, Enam Financial Services, DSP Merrill Lynch, J. M. Morgan and Kotak Mahindra as merchant bankers. Following the IPO, the government’s holding in the bank will come down to 67 per cent.

“We have not yet decided on the premium amount. However, the pricing will be either Rs 12 or Rs 14,” said V. P. Shetty, chairman and managing director of Uco Bank.

UBI, however, will take another month’s time to decide on how to go about its Rs 50-crore IPO. “We will float the IPO in December,” said chairman and managing director Madhukar.

UBI has registered a 250 per cent increase in its net profit at Rs 305 crore in 2002-03 against Rs 119 crore in the previous fiscal. The treasury operations of the bank has contributed Rs 301 crore to the profit.

The bank, which has a capital adequacy ratio (CAR) of 15.17 per cent, has been able to reduce its non-performing assets by Rs 340 crore against Rs 294 crore in the previous year. Fresh NPA generation is to the tune of Rs 60 crore against Rs 98 crore in the previous year. The gross NPA of the bank has come down from Rs 1239 crore to Rs 959 crore.

Madhukar said: “RBI guidelines for weak banks, like ours, sets certain trigger points for net NPAs, CAR and return on assets. However, UBI’s position is well above on all three parameters.”

Uco Bank, which recently received autonomy from the RBI in different areas of operations, has registered a net profit of Rs 207 crore against Rs 165 crore in the previous year — a growth of 25.45 per cent.

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