leading PSB lender Syndicate Bank is readying to go raise Rs 1300 crore through QIP route and is awaiting Government nod with the bank's board having already cleared the proposal to reduce Government's holding by 5 percentage points.
"We are waiting as the proposal having already been cleared in our last AGM and will go ahead through a QIP as soon as the Government gives us the go-ahead signal," SK Jain, CMD told The Pioneer. This will reduce Governments holding from the present 67.5 per cent to 62 per cent.
Asked if the Bank was planning to cash in on the current bullish sentiments with the BSE Sensex hovering around 26K, Jain said,"We are watching but that would have to be after the Government's approval."
Syndicate Bank reported first-quarter net profit of Rs 485.42 crore, compared with Rs 452.28 crore in the corresponding quarter last year, reflecting a growth of seven percent. "Future growth of bank credit looks positive with the new confidence in the business and industry with the new policies of the Modi government," said Jain.
Budget announcments by the FM Jaitley, like the freeing of meeting SlR requirements for micro- credit advances as well as the announcement of every household to have two savings account, were indeed positive steps from the Government, he added.
"However, rising CPI based inflation, weak Monsoons as well as the Iraq problem were the main concerns for the economy and thereby on the banks future performance," he added.
As on June 30 this year, gross non-performing assets (GNPA) as a proportion of gross advances stood at 2.97 per cent, up from 2.38 per cent as on June 30, 2013, while net non-performing assets (NPAs) as a proportion of net advances was 1.88 per cent, increased from 1.19 percent last year. However, Jain said that what was appreciable was that the bank was still able to keep the GNPA level below the 3 per cent level.
Its quarterly net interest income fell by one per cent to Rs 1,350.93 crore from Rs 1,337.33 crore in the year-ago quarter, while non-interest income was Rs 456.34 crore, compared with Rs 294.52 crore for the same period last year, reflecting a 55 per cent growth.
Net interest margin for the quarter was 2.47 per cent, compared with 2.83 per cent in the year-ago quarter. Total Income for the quarter stood at Rs 5,523.08 crore, higher by 17 per cent than Rs 4,726.18 crore last year.
Income from 'Domestic Operations' stood at Rs 5,282.25 crore, compared with Rs 4,562.50 crore a year ago, an increase of 16 per cent, while that of 'Foreign Operations' was up by 47 percent at Rs .240.83 crore, compared with last year's Rs 163.68 crore.
Operating profit for the quarter amounted to Rs 1,013.89 crore, higher by seven percent than Rs 948.55 crore in Q1FY14. Capital Adequacy Ratio, as per BASEl-III, as on June 30 this year was 10.80 percent, down from 11.49 percent at the end of June 30, 3013.
As on June 30, 2014, total global deposits was Rs 214,863 crore, up by 18 percent from Rs 182,513 crore as on June 30 last year, while global advances totaled Rs 176,442 crore, compared with Rs 149,383 crore for the quarter ended June 30, 2013, an increase of 18 percent.