CHENNAI, Mar 9: The Thrissur-based South Indian Bank Ltd (SIB) may opt for a pubic issue of equity shares in the coming fiscal, the bank's chairman and managing director, Maurice D'Souza, indicated here on Monday.Speaking to newspersons after the inaugural function of SIB's new branch here, D'Souza said the bank would study various options of capital infusion over the next three months. ``If we are going in for an issue, we will need a lead time of around three months,'' he said and added that the board would reach a decision by the end of June.
He, however, hastened to allay fears of any takeover threat. ``We have a widely dispersed shareholder base,'' he said. Also, as ICICI has a 26 per cent stake, the bank is in a fairly stable position, he said.
SIB had also ``just received approval from the Reserve Bank of India (RBI) to raise Rs 30 crore Tier II capital,'' he said. This will take the Tier II to Rs 65 crore. Currently, the bank's authorised capital stands at Rs 50 crore, while its paid-up capitalis Rs 20 crore.
The bank will go in for a subordinated debt issue before the end of this month on a private placement basis. Along with the recently concluded 1:3 rights issue, the Tier II expansion would place the bank's capital adequacy ratio (CAR) comfortably above the stipulated eight per cent, D'Souza said.On SIB hiking interest rates on domestic term deposits, D'Souza refuted the charge that this move was aimed at window-dressing the balance sheet. ``It's purely a short-term measure,'' he said and added that the bank had enough avenues to deploy funds. Credit pick-up had been reasonable, he said.
