13010 Investors following Oriental Bank. Share this News with them.
0
Like this story, share it with millions of investors on M3
Oriental Bank to raise Rs 300cr by Dec first week
In an interview with CNBC-TV18, SC Sinha, Executive Director of Oriental Bank of Commerce (OBC), spoke about the fund raising and growth plans of the bank.
In an interview with CNBC-TV18, SC Sinha, Executive Director of Oriental Bank of Commerce (OBC), spoke about the fund raising and growth plans of the bank. Here is a verbatim transcript of an exclusive interview with SC Sinha on CNBC-TV18. Also watch the accompanying video. Q: When are you planning to raise Rs 300 crore? What will it take your capital adequacy to? A: Our capital adequacy is already very comfortable at 12.68. The mandatory requirement is 9%. So we are already much above the mandatory requirements and our Tier-I is already 9.08. In order to meet the growth path, we have planned 20-22% on year on year (YoY) growth in credit. So we intend to raise it by December first week. Q: How much will that take your capital adequacy to after Rs 300 crore comes in? A: It will remain around 12.70. Q: What do you expect the cost of this capital to be? A: The cost of capital will be market driven. However, it will be somewhere around 9%. Q: Will it be for a ten year paper? A: Yes it is perpetual. Q: What kind of credit growth you are expecting in the second half? Will you be able to reach about 22-23%? A: We are aiming for 20-21% and though Government of India in our SOI has said roughly around 18%, but we are aiming for 21% maximum. Q: What about your net interest margin (NIM)? The current account, savings account (CASA) ratio at the end of Q2 stood at 1.9% and 24% by the end of this financial year. Where could we see these two figures? A: Our NIM was 2.03 quarter to quarter. This time we have planned that we should reach at least 2.20 by March 2010. CASA presently is 23.6%, but we have planned for 25% by March 2010. Q: Are you expecting that you will be lowering deposit rates? What about lending rates? A: The deposit rates are likely to come down because banks are flushed with liquidity and the credit growth is not matching with the deposit growth. So with the deposit we are not aiming very high. Depending upon the growth path in credit, we will be taking deposits. Therefore, CASA will remain in the focus for our deposit growth. The short-term deposit or deposit less than Rs 5 crore will be more convenient for us. On the credit path, we are expecting growth in infrastructure, power, mid corporate and agriculture. We expect credit growth in agriculture sector also.
