The Planning Commission has to give its nod to the Central Government's Rs 3,000-4,000-crore capital infusion plan in State Bank of India, said the bank's chairman, Mr Pratip Chaudhuri.
“The Government has allocated us about Rs 3,000-4,000 crore. This has to go to the Planning Commission, because this is an investment, and not expenditure, decision. The Government will give capital to all the banks at the same time,” Mr Chaudhuri told newspersons after a meeting between the Finance Minister and the heads of public sector banks here on Tuesday.
The bank is hopeful of receiving capital by end-December. Capital infusion of Rs 3,000-4,000 crore coupled with reasonable profits will boost the bank's Tier I capital adequacy ratio to 9 per cent. “In case we do not get funds by December, we should get them by March 2012,” he said.
The Government is mulling options such as preferential issue of shares, rights issue and qualified institutional placement for infusing funds into the bank. In case the Government decides to go for a rights issue or a QIP, then its stake will remain unaltered at 59.40 per cent, whereas if it is a preferential issue, the Government's shareholding could go up to 65 per cent, Mr Chaudhuri pointed out.
Talking about asset quality, Mr Chaudhuri said that there has been a rise in non-performing assets in sectors such as power, aviation and textiles.
NET INTEREST MARGINS
State Bank expects to surpass its net interest margin target of 3.5 per cent during the current year. “In the beginning of the year our projection was 3.5 per cent, and we have already achieved NIM of 3.62 per cent so far during this year. The current indication is that the margins will surpass that level by the end of this year,” he said.
The bank has no immediate plans to raise interest rates on saving deposits. “We do not intend to raise interest rates now as there is no flight of deposits. On the contrary, we are seeing accretion in deposits,” he said.
+1.jpg)
0 comments
Post a Comment