Indian Bank plans to tap the market by September to raise up to Rs 1,000 crore to meet its Tier-II capital requirements, said T M Bhasin, chairman and managing director.
The Chennai-headquartered public sector bank has its present Tier-II capital at around 1.58 per cent and Tier-I at 11.13 per cent, against the prescribed norm of 12 per cent by the Reserve Bank of India. “We have enough room to raise Tier-II capital,” Bhasin said.
On the progress of the newly-started syndication business, Bhasin said for the present fiscal the bank had set a target of around Rs 10,000 crore and the focus would be on the infrastructure sector through which it expects to earn around Rs 150 crore as commission. This was one of the initiatives of the bank to strengthen its fee-based income which was around Rs 1,173 crore for year-ended March 31, 2010.
The bank had tied up Rs 1,800-crore for a JP Power project, of which it has underwritten Rs 500 crore, added V Ramagopal, executive director, Indian Bank. “We will now start marketing the remaining portion of the loan to other banks,” said Ramagopal.
Indbank Mutual Fund, its subsidiary, has started scouting for partners. “At present business is minimal, but going forward, this would bring a major chunk to our fee-based income,” said A S Bhattacharya, executive director, Indian Bank.
“By September, we will start the mutual fund operations on a bigger scale,” added Bhasin. He ruled out the possibility of entering the insurance sector, which according to him, is capital-intensive. “We are interested only in bancassurace business,” he said.
The bank on Monday launched various customer service initiatives and a new gold loan product for senior citizens.