Mumbai, Aug. 25: Uco Bank is taking a re-look at its deposit rates following the decision of the Reserve Bank of India (RBI) to lower the repo rate by half a percentage point.
Other nationalised banks, including Bank of Baroda, State Bank of India (SBI) and Indian Overseas Bank (IOB), are also considering a re-alignment of deposit rates.
It is expected that banks are likely to slash deposit rates by 25 to 50 basis points, whereas interest rates on advances may come down by 25 basis points.
Uco Bank chairman and managing director V. P. Shetty said, “There will be a revision of rates.”
Uco Bank today announced its initial public offering (IPO) of 20 crore equity shares of Rs 10 at a premium of Rs 2 per share aggregating to Rs 240 crore. The issue will open for subscription on September 3 and close on September 10.
The bank will use the proceeds primarily to augment long-term resources in line with an estimated growth in assets and maintain a comfortable capital adequacy ratio (CAR).
According to Shetty, the bank is investing Rs 184 crore to implement a core banking solution across 200 branches within 18 months, covering around 53 per cent of its total business. The bank has a network of 1705 branches in the country.
Shetty expects the bank’s fee-based income to jump following strategic alliances with domestic insurance majors.