The conversion price of the warrants will be determined through the average of the weekly high and low closing prices for 6 months prior to the date of the the warrant conversion. The conversion price will be decided at a 25 per cent discount to the average market price. The warrants will be detachable and tradeable till the date of the converstion. The warrants are proposed to be listed at the Jaipur Stock Exchange, the Bombay Stock Exchange, the Calcutta Stock Exchange, the Delhi Stock Exchange and the MP Stock Exchange.

In order toensure full subscription to the rights issue, the bank has also plans to make underwritting arrangements. P K Tayal, the new chairman and managing director of the bank, is also planning to pick up additional equity shares in the event of a shortfall in rights subscription. However, the promoter will be able to subscribe additional equity shares upto a maximum limit of 10 per cent of the issue size. The cash-rich promoter of Shree Krishna group, P K Tayal, has already deposited Rs 20 crore with the Bank of Rajasthan. Post-rights, paid capital of the bank will swell from Rs 17.93 crore to Rs 62 crore. The bank will also see a major equity dilution after the warrant conversion in next one and half years.

The mutual funds and financial institutions hold 5.8 per cent of the bank's equity, other corporate bodies 41 per cent and individual shareholders 52.72 per cent. The new board of directors of the bank constitutes P K Tayal, Sada Siva Gupta, D B Sogani, Narendra Mohan Gupta, O N Chaturvedi, B P Singh, VinayMittal, V K Rungta, Satyajit Mitra, K K S Chauhan, Deepak Saruparia, B R Gupta, S K Tayal, Som Prakash Arya and S L Parmar (RBI nominee).

The ailing Bank of Rajasthan has a low capital adequacy ratio of 5.54 per cent and a very high level of net non-performing assets of 9.14 per cent.

On an equity base of Rs 17.94 crore, BoR has a reserves and surplus of Rs 83.12 crore as on March 31, 1998 against Rs 169 crore last fiscal. As the bank has the highest net NPAs among private sector banks, the higher provision saw the bank incurring a net loss of Rs 87.84 crore for the fiscal 1998.

The bank (with 302 branches and 36 extension counters) is projecting a net loss of Rs 33 crore on an operating income of Rs 407 crore for the fiscal 1999. The provision for the current fiscal is expected to be around Rs 49 crore. The stock market has welcomed the management change at the bank and the scrip is currently hovering around Rs 36.