Vijaya Bank plans to raise Rs 900 crore through bonds by December and said it is looking for acquiring a small bank preferably in the North or East."We may raise Rs 700 crore through Upper Tier II bonds and Rs 200 crore through Lower Tier II bonds by December to meet the higher capital requirement under Basel II from March next year," Vijaya Bank Chairman Prakash P Mallya said here.The Bangalore-based bank has raised Rs 250 crore through Lower Tier II bonds last month, following which its capital adequacy ratio (CAR) has gone up to 11.7% from 11.5% and is likely to touch 12% by December.With no headroom available to come out with another public issue as the government holding is 53%, Mallya said the bank may have to raise capital in future through hybrid instruments.The bank, which is largely concentrated in South, wants to expand presence by acquiring a small bank either in North or East of the country."Next year, Vijaya Bank may take over another bank," Mallya said without giving further details.He said synergy has to be there and there should not be any clash of cultures. Vijaya Bank, which is celebrating its Platinum Jubilee on November 5, is targeting to further reduce gross and net non-performing assets (NPA) to 2.5% and 0.5% by March 2007 from 2.96% and 0.85% respectively as on June 2006.
