Indian Overseas Bank to raise $500 million through overseas bond sale
IOB CMD says the bank would require `3,500 crore as fresh capital during the current fiscal
Mumbai: State-owned lender Indian Overseas Bank (IOB) announced here on Wednesday that it plans to raise $500 million through a medium-term bond sale shortly.
The bank has already received approval to raise up to $1 billion from its board. “Currently, the market is very right. So, when we see good appetite from corporates, we will raise $500 million out of our medium term note programme," Indian Overseas Bank’s outgoing chairman and managing director M. Narendra, who retires on Thursday, told reporters.
He said that the bank would require ₹ 3,500 crore as fresh capital during the current fiscal. “We have asked some amount from the government also. Last year, we got ₹ 1,200 crore from the government and we hope this year we get a similar amount," Narendra said.
The bank also plans to raise some funds through qualified institutional placement, but its timing and amount would be decided after government and Reserve Bank of India approvals.
In the quarter ended June, the bank’s net profit more than doubled to ₹ 271.72 crore from ₹ 125.80 crore. Total income was tad up at ₹ 6,284.69 crore compared to ₹ 6,187.15 crore in the year-ago quarter. Gross NPAs stood at 5.84% as against 4.45%, while net NPA increased to 3.85% from 2.81% in the year-ago period. Provision coverage ratio as on 30 June stood at 52.85%.
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