Chennai, Sept 03: The urgent need to boost capital adequacy rate, favourable market conditions and strong fundamentals have enabled the Indian Overseas Bank to come out with its second public offering of ten crore equity shares of Rs 10 each at a premium of Rs 14, aggregating Rs 240 crore, a top executive of the bank said here today. The issue would open on September 5 and close on September 12, chairman and managing director of IOB, S C Gupta, told a news conference here, while announcing the details of the public issue.
He said the United Commercial Bank, also coming out with its IPO around the same time, would not pose any 'difficulty' to the IOB. Another factor that went in favour of IOB coming out with the public issue now was its decision to introduce in the next two years 'prudential norms', which were fast changing.
Gupta said great level of commitment by IOB employees, reduction in cost of deposits and overhead expenditures, increase in non-interest income and better asset-liability management had all contributed to the increased profitability of the bank. The total business of the bank as on March 31 this year crossed Rs 54,000 crore. After this issue, the holding of government of India on the bank, would come down from 75 per cent to 61.23 per cent, Gupta said. Bureau Report