Chennai, Jan 30 (IANS) Public sector Indian Bank plans to convert Perpetual Non-Convertible Preference Shares (PNCPS) worth Rs.400 crore into equity at market rate soon even as it has the government’s sanction to dilute 10 percent of its equity, a top bank official said Monday.
“As the 10 percent PNCPS will be converted into equity share capital at the market rate the cost will not be high for the bank. We also have the government permission to dilute 10 percent government holding through the issue of 6.14 crore shares amounting to Rs.61.40 crore in hand,” T.M. Bhasin, chairman and managing director of the city-based bank, told reporters here.
The bank’s current equity capital is Rs.429.77 crore.
Bhasin said the bank closed its third quarter with a net profit of Rs.526 crore as against Rs.491 crore posted during the corresponding period of the previous fiscal.
“This is the first time in the bank’s history that the quarterly net profit has crossed the Rs.500 crore figure.”
Bhasin said the bank’s net interest income for the quarter went up by 33 percent to Rs.3,505 crore from Rs.2,641 crore earned during the like quarter of the 2010-11 financial year.
According to him, for the period under review Indian Bank’s total global business went up to Rs.207,014 crore (deposits Rs.118,970 crore, advances Rs.88,044 crore) from the previous year’s figure of Rs.174,035 crore (deposits Rs.101,015 crore, advances Rs.73,919 crore).
Indian Bank’s cost of deposit stood at 6.86 percent, yield on advances 11.66 percent and yield on investments 7.63 percent.
About the bank’s non performing assets (NPA), Bhasin said the gross NPA to gross advances ratio was at 1.35 percent, while the net NPA to net advances was at 0.80 percent.
During the first nine months of the current fiscal, the bank has added fresh NPA of Rs.839 crore and for the third quarter the loan account slippage is Rs.293 crore.
He said the NPA recovery target for the current fiscal is Rs.500 crore and till date the bank had recovered Rs.366 crore.