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Uco turns to LIC for cash prop

The bank envisages a capital requirement of Rs 4,500-5,000 crore in 2019-20
Uco Bank's managing director and CEO Atul Kumar Goel told The Telegraph that the bank has approached the life insurer for additional capital, having already raised around Rs 500 crore as Basel-III compliant tier-II bonds.
Uco Bank's managing director and CEO Atul Kumar Goel told The Telegraph that the bank has approached the life insurer for additional capital, having already raised around Rs 500 crore as Basel-III compliant tier-II bonds.
Telegraph file picture

A Staff Reporter   |   Calcutta   |   Published 08.08.19, 08:55 PM

The Life Insurance Corporation could play a key role in Uco Bank’s capital-raising plan in the current fiscal.

The city-based bank envisages a capital requirement of Rs 4,500-5,000 crore in 2019-20. While the bank will primarily look at capital from the government, there are two concerns.

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First, the Centre holds 92.52 per cent in the bank as on June 30, 2019, while public shareholding is only 7.48 per cent. The bank has informed its shareholders that it has to comply with a minimum public shareholding of 25 per cent before August 3, 2020, which is less than a year from now.

Second, the current volatility could make it difficult for the bank to tap the the capital market.

The bank’s managing director and CEO Atul Kumar Goel told The Telegraph that the bank has approached tLIC for additional capital, having already raised around Rs 500 crore as Basel-III compliant tier-II bonds.

Uco Bank has lowered its losses for the quarter ended June 30, 2019, to Rs 601.45 crore from Rs 633.88 crore a year ago.



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