South-based Lakshmi Vilas Bank plans to raise up to Rs 350 crore this fiscal from a institutional placement of shares to buffer its core capital.
"We are planning to raise Rs 300-350 crore in the next five to six months which will help our core capital. Last time we raised money through a rights issue, this may be a QIP," its managing director and chief executive Rakesh Sharma told PTI here today.
The bank's overall capital adequacy had stood at 11.34 per cent as on March 31, with the core tier-I capital at 9.33 per cent, which is among the lowest in the industry.
Sharma said the fund infusion can take the total capital adequacy up to 12 per cent with the tier-I capital at 10.50 per cent.
He said factors like a near-doubling of profit in FY15 to Rs 120 crore, an improvement in the asset quality with the gross non performing assets ratio to 2.75 per cent from the year ago's 4.19 per cent and also an improvement in other ratios like the return on equity and return on assets will help it while going before investors.
It is targetting for a 23 per cent growth in both advances and deposits for FY15, as against 26 per cent and 18 per cent respectively, Sharma said, adding that the last fiscal it was a conscious call to go slow on deposit growth because of the low credit deposit ratio.
The bank is not a target for acquisition, Sharma said, adding that it will like to grow the 88-year-old brand organically.
It is targetting to open 75 branches in FY16, as against 38 branches opened in FY15, he said, adding that 40 per cent of the new branches will be in non-south Indian states.
At present, it has 400 branches with an 86 per cent concentration in south India, he said, adding the new states it is interesting in are Madhya Pradesh, Rajasthan and Haryana.
