Central Bank plans to raise Rs 1,500 crore

Central Bank is planning to raise around Rs 1,400-1,500 crore as part of its capital raising plans for the rest of the current fiscal.

“We had planned to raise around Rs 2,000 crore in 2014-15. The bank has already raised Rs 580 crore through a preferential allotment to Life Insurance Corporation in the current fiscal and have plans to raise Rs 1,400-1,500 crore more. We have planned a stake sale in one of the companies in which we hold stake (IL&FS). In case we require more funds post the stake sale, we will look at a qualified institutional placement (QIP),” Central Bank Chairman and Managing Director Rajeev Rishi said.

The government currently holds 84.2 per cent stake in the bank and may look at cutting down its stake according to Rishi.

“Current holding of the government in the bank is 84.2 per cent. The government will reduce is stake in the bank. However, it is in no hurry to do it and may only do it in the next financial year (2015-16),” Rishi said.

The bank reported net profit of Rs 102.91 crore in the second quarter of the current fiscal as compared to a loss of Rs 1,508.74 crore in the same quarter last year.

“We have been in a consolidation phase in the last four quarters due to which we have been able to achieve profits in the current quarter compared to a huge loss in the same quarter last year,” Rishi said.

The non performing assets have shown a steady downward trend due to which we have been able to improve our performance compared to last year, Rishi added.

Gross NPAs for the bank in Q2 reduced to 6.14 per cent compared to Rs 6.47 crore in the same quarter last year while net NPAs in Q2 were down to 3.38 per cent compared to 3.77 per cent in Q2 of 2013-14.

Net interest income for the bank during the quarter grew 27.41 per cent to Rs 1,827 cr compared to Rs 1,434 crore in the same quarter last year.

Fresh slippages stood at Rs 1,704 crore as against Rs 2,570 crore in the year-ago quarter.

It wrote off Rs 88 crore in loans and upgrade stood at Rs 1,119 crore. Fresh loan recasts stood at Rs 1,576 crore.

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