Nedungadi Bank proposes to attain the Reserve Bank of India's (RBI) stipulated networth of Rs 100 crore by March 2001.
The net worth of the Calicut-based private bank which stood at Rs 17.64 crore in March 1996, has touched Rs 61.37 by March 2000, mainly due to an increased profitability and transfer of large amounts of money to the reserves, its chairman, A R Moorthy, said.
"We plan to maximise our net profit and plough back the profit to increase the net further," a bank release said, quoting Moorthy as saying.
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Analysts, however, point out that the bank's net profit which doubled to Rs 14.63 crore in fiscal 1999-2000 was unlikely to meet the target even if it doubles its profit after tax in 2000-01 and even after the plough-back it would amount to only Rs 90.63 crore.
As part of diversification plans, the bank intends to enter into forex trading, Moorthy said, adding that on the advice of PricewaterhouseCoopers it would go in for a strategic alliance with one of the new players in the insurance sector.