Andhra Bank proposes to raise Rs 800 cr in FY'15: CMD

State-owned Andhra Bank has proposed to raise Rs 800 crore during the next financial year to fund its growth plans, a top official said today. "We are planning to raise (funds) through QIP (Qualified Institutional Placements) or from Government of India. We require about Rs 800 crore..," Andhra Bank Chairman and Managing Director CVR Rajendran told reporters. It would be decided by third quarter of 2014-15 financial year, he added.

"Right now the Government share holding is 60 percent. Last year we got about Rs 200 crore. Initially we will approach the Government of India else we may go for QIP. We have found that going for an FPO is costly at this stage..," he said. The proposal to raise funds is to achieve 20 percent growth during the next financial year, he said. Commenting about the third quarter results for the period ending December 31, 2013, Rajendran said the net profit of the bank declined by 82.1 percent to Rs 46 crore due to higher provisioning on account of high NPAs.

Net profit for the quarter ending December 31, 2012 stood at Rs 257 crore. For the nine month period ending December 31, 2013 its net profit declined by 63.1 percent to Rs 348 crore from Rs 945 crore registered during the same period of last fiscal. Total income of the bank for the third quarter ending December 31, 2013 rose by 12.5 percent to Rs 3,901 crore from Rs 3,469 crore registered during the same period of previous year.

For the nine-month period, its total income increased by 13 percent to Rs 11,572 crore, from Rs 10,241 crore during the same period of the previous fiscal. Responding to a query about the gross NPAs of 5.45 percent, one of the highest among public sector banks, Rajendran said the banks' NPA were predominantly in secured assets. "My bank NPAs represent good assets. That means secured. These are all because of the policy logjam by government," he said.