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Monday May 5, 9:57 PM
UPDATE-1 UCO to raise funds via equity, net lags forecastKOLKATA, May 5 (Reuters) - State-run Uco Bank plans to raise 3.25 billion rupees through preferential issue of shares by June and convert federal government's equity worth 3 billion rupees into preference shares, a top official said. "We will be raising funds through issue of preference shares as part of the government approval for capital restructuring," Chairman and Managing Director, S.K. Goel, said.
The bank also plans to raise 5-6 billion rupees through a follow-on public offer of shares, he added. "We hope to hit the market in the third quarter of current fiscal," he said. The Kolkata-based bank is looking at loan growth of 20 percent and a deposit growth of 22 percent during the current financial year, which ends in March 2009, Goel said. Earlier in the day, the bank reported a 177.93 percent rise in net profit to 859.9 billion rupees, from 309.4 million on higher recoveries of written off loans. The net profit, however, lagged a Reuters analyst estimate of net profit of 977.5 million rupees. Shares in the bank rose to 51.50 rupees during the day before closing at 50.20 rupees, up 13.57 percent over previous day's close in the Mumbai market. "Proceeds from written off loans boosted profits in the quarter," he said. The bank recovered 1.02 billion rupees of written off loans in FY08, up from 420 million rupees a year ago. Yield on loans during the last fiscal also rose to 9.96 percent, from 8.86 percent a year ago. Its current capital adequacy ratio was 10.09 percent, while the net non-performing assets fell to 1.98 percent, from 2.14 percent a year ago. "We are targetting to recover another 1.50 billion rupees of written down loans in the current financial year," he said. (Reporting by Tamajit Pain; Editing by Prem Udayabhanu)
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