GOVT INFUSES RS 450 CR INTO CENTRAL BANK

Central Bank of India has received Rs 450-crore capital infusion from the Government on March 31. The bank would allot Perpetual Non-Cumulative Preference Shares (PNCPS) to the Central Government towards this capital infusion. The PNCPS will bear an annual floating coupon to be benchmarked to repo rate with a spread of 100 basis points to be re-adjusted annually, the bank said in a filing to the stock exchanges on Monday. These preference shares are not transferable and will not be listed in the exchanges.

Mr S. Sridhar, Chairman and Managing Director of the bank, said that the latest capital infusion (Rs 450 crore) will place the bank in a “comfortable position” on the capital adequacy front. “Earlier, we were only meeting the regulatory limits. Now after the latest infusion, our capital adequacy will be comfortable.”

He did not rule out the possibility of the bank going in for more capital raising in the first half of the current fiscal. “More capital may be needed. We are working on it (in deciding the capital raising route),” Mr Sridhar said.

The Centre holds 80.20 per cent stake in Central Bank of India, whose paid-up capital stood at Rs 404.14 crore as on December 31, 2009.


Source: http://www.blonnet.com/2010/04/06/stories/2010040650790600.htm