GTB plans Rs 500crore pref issue by Feb end

Global Trust Bank (GTB) is expecting to complete its capital-raising exercise by February-end. The bank has recently raised its authorised capital to Rs 650 crore from the earlier Rs 350 crore. Its existing paid-up capital stands at Rs 121.36 crore.

"We are looking at mopping up around Rs 500 crore through a preferential issue, which is expected to be made by this month-end," Sudhakar Gande, the managing director of GTB, told Business Standard .

Refusing to divulge the names of the investors, he said that they are in an advanced stage of negotiations with few global investors. The bank appointed Lazard India and JM Morgan Stanley as financial advisors for this purpose.

A special committee comprising three directors was also constituted for the finalisation of the terms of the investment.

"Once the capital infusion is over, we will focus on business growth. Long term and short term growth plans were already drawn and we hope to regain glory, Gande said.

Meanwhile, the bank has reported a 82 per cent drop in net profit at Rs 1.59 crore for the quarter ended December as against Rs 8.79 crore registered for the corresponding period last fiscal.

With both the interest income and other income declining, the total income slid by 29 per cent to Rs 140 crore from Rs 196.4 crore. Commenting on the poor performance, Gande said that the fall in interest rates as well as the treasury yields stabilising at the current levels have hit the topline and bottomline.

"We expect the present trend to continue for the next few quarters," he added. For the nine months ended December, the net profit and total income were down by 58 per cent and 21.5 per cent at Rs 11.76 crore (Rs 28.2 crore) and Rs 464.77 crore (Rs 592 crore) respectively.