The Telegraph
Since 1st March, 1999
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Central Bank public offer in six months

Calcutta, Sept. 18 (PTI): The Central Bank of India plans to hit the market with an initial public offer within six months. It is targeting a 70 per cent bottomline growth this fiscal.

Bank chairman and managing director Dalbir Singh said here today that the management is currently seeking approvals from regulatory authorities for the public issue. The bank will also raise Tier-I and Tier-II capital, but the amount was yet to be decided, he said.

On the bank’s performance, he said it expected to achieve a 70 per cent growth in profit this year. Growth during the first quarter was about 30 per cent.

The high bottomline growth this year was expected in the absence of a huge outgo on the voluntary retirement scheme that brought down the margin last fiscal, Singh said, adding there was no plan for another round of VRS as of now.

Singh, who also heads the Indian Banks’ Association, said the banking sector was making serious efforts to reduce non-performing assets and had made some progress in this regard.

However, there were “obstacles” from vested interests who wanted the status quo to be maintained, he alleged.

Earlier, speaking at ‘Fintech 2002,’ organised by the CII, Singh said the banking sector was concerned about the deceleration in the rate of growth in non-food credit offtake.

“This is a matter of concern. Hence, it has been receiving focused attention of all quarters. Several new instruments and avenues for deployment of funds are being discussed.”

On financing of infrastructure projects, he said while infrastructure had a long gestation period and the banks’ liabilities were short-term in nature, “the risks of consequent maturity mismatch between assets and liabilities need to be carefully evaluated and safeguards have to be built in.”

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