Uco Bank in final laps of hiring merchant bankers to raise Rs 1,000 cr via share sale

Kolkata: State-owned Uco Bank is in final laps of hiring merchant bankers for elevating about Rs 1000 crore in share gross sales, whereas its attraction to Life Insurance Corporation of India for capital injection on preferential foundation has failed to elicit response thus far.

Uco chief govt AK Goel on Monday mentioned the financial institution has approached LIC once more and that the Corporation would “take a call” on capital infusion. The Kolkata-based lender has been in talks with the nation’s largest insurer for the final couple of years.

LIC holds 2.23% in Uco whereas it may raise its holding up to 15%. The authorities holds 94.44%.

Meanwhile, Goel mentioned that the method of hiring merchant bankers is in the final phases. The choice has already been carried out.

The financial institution, which reported Rs 35 crore internet revenue for the December quarter in opposition to a Rs 960 crore loss in the yr in the past interval, would most definitely hit the fairness market after the March quarter.

Goel mentioned the financial institution has adequate capital for this quarter with capital adequacy of 12.08% as in opposition to the requirement of 10.875%.

The lender has board approval for elevating up to Rs 3,000 crore in mixture of fairness and bonds.

Uco’s working revenue rose about 10% at Rs 1334 crore in the December quarter in opposition to Rs 1211 crore in the yr in the past interval. Its provision fell to Rs 1299 crore in opposition to Rs 2171 crore over the identical interval. Gross non-performing property ratio improved 9.8% in opposition to 19.5% whereas internet NPA was at 2.97% in opposition to 6.34%.

“The effect of pandemic is likely to be felt in the March quarter,” Goel mentioned, including that the financial institution has made 15% provision in opposition to the stipulated 10% on the confused accounts.

Banks didn’t classify borrower accounts as NPA following an order by the Supreme Court, which informed banks to holdback classification of property, which weren’t NPA until August.

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