BoB readies Rs 218 crore war chest for Asia, Africa buyouts

Bank of Baroda has built up a war chest of Rs 218 crore (at an exchange rate of Rs 43.75 per dollar) for overseas acquisitions in Asia and Africa.

"We are looking at acquiring majority stake in some small-sized banks in Asia and Africa," said A S Khurana, general manager, Bank of Baroda (BoB) at the sidelines of a press conference here today.

BoB today announced that it has chosen HP as its strategic IT partner for the implementation of its core banking solution project. HP would implement a single platform namely, Infosys's banking software 'Finnacle' across 1,919 domestic branches and 55 international branches.

Khandelwal, however, declined to divulge any details regarding the cost of the project. "There are huge costs involved for the bank but I would not like to share the numbers," he said.

The bank aims to implement the core banking solution (the solution will be Basel II, RTGS and anti-money laundering compliant) across 150 branches by March 2006, 664 branches by March 2007 and another 1,315 branches by March 2010.

"BoB's second public issue is likely to hit the market in June-July 2005. BoB will sell 7.1 crore shares and aims to raise about Rs 1,500 crore from the market," added Khandelwal. This would help push up the bank's capital adequacy ratio from 13.9 per cent to 15 per cent.

The chairman, who took charge about a month ago, said he would have four focus areas for the bank. "Technology implementation, an accelerated credit growth of 25 per cent, the second public issue and the agriculture sector would be the main focus areas," he said.

In FY 05 the bank's advances grew by over 20 per cent and deposits by 11.5 per cent. The bank clocked total business of Rs 1,27,000 crore as on March 31, 2005, which was a growth of 22 per cent over the previous fiscal.