BoB divests stake in Dena Bank

Bank of Baroda (BoB), which held around two per cent stake in Dena Bank, has divested its entire stake in it in the last few months.

In a parallel development, Life Insurance Corporation of India (LIC) which held another two per cent in the bank, has offloaded a portion of its holding and now holds close to one per cent.

BoB has, in fact, got rid of its stake in Dena Bank over the last two quarters. In the quarter ended December 2004, BoB sold off its entire stake which was around 1.07 per cent.

While, public sector companies have pared their stake in Dena Bank, UBS Securities Asia for Swiss Finance, has picked up two per cent stake in the public sector entity.

This, despite the fact that Dena Bank is planning to enter the capital markets again to raise Rs 200 crore through a public issue following which the Centre's stake would come down to 51 per cent.

Sources close to the development said that the issue was expected to hit the market by end January or early February. The premium is expected to be around Rs 23-27. The current scrip price of the bank is around Rs 40.

Meanwhile, Dena Bank has also decided to open 40 Finmarts, its retail financing outfits, at its branches by the end of the current fiscal to boost the share of retail segment in business.

The state-owned bank recently launched 11 Finmarts across various cities, including New Delhi, Chandigarh, Jaipur, Goa and Pune, along with 11 more automated teller machines.

Finmart would be managed by trained staff to cater to retail segment for dispensing credit. As a part of its plan to provide a technology-based platform for customers, the bank has also started a new internet-enabled money transfer service for US-based non-resident Indians.

It has also launched a multi-city cheque facility for facilitating speedy processing of payments for trading community.