Dena Bank is looking to raise tier one capital of about Rs 1,500 crore, tier two of about Rs 1,000 crore and depending on how the market behaves, the bank may also go for core equity, says CMD Ashwani Kumar.He hopes that with credit growth and uptick in the market, the bank will be able to have a CRAR of about 11.5 percent by March 31.
Below is the verbatim transcript of Ashwani Kumar's interview with CNBC-TV18's Latha Venkatesh and Sonia Shenoy
Sonia: How much the bank is looking to raise and what would this do to your capital adequacy ratio?
A: We have given the information to exchanges. We are planning to raise tier one capital of about Rs 1,500 crore, tier two of about Rs 1,000 crore and depending on how the market behaves we may go for core equity also. So we expect that our capital to risk assets ratio (CRAR) will improve substantially.
Latha: What is the capital raising plan? At what cost will you get your new bonds?
A: As I said we are going to the board tomorrow to raise tier one bonds up to Rs 500 crore and tier two bonds up to Rs 1,000 crore, but regarding pricing, let us see the market, it should be in 10 plus range and we hope that with credit growth and uptick in the market, we will be able to have a CRAR of about 11.5 percent by March 31.
Latha: Can you give us the lowdown on which are the companies in which you all have exposure, companies for which strategic debt restructuring is under consideration. Do you have exposure for Gammon India, Monnet Ispat, Electrosteel Steels, Jyoti Structures, any of these?
A: We have about two-three companies that you mentioned. We do not have Gammon, but we have Monnet Ispat.
Latha: Have you been able to identify new buyer?
A: No, that's in the process.
Latha: For the others, Lanco and Jyoti — have you have the exposure, any update on buyer?
A: We have some units of Lanco, but as of now I do not think any buyer has come so far.
Latha: In Electrosteel Steels, have you found anyone?
A: Nothing has specialised so far but talks are on. So let's see how things are possible.
Latha: What is your sense about your own fresh slippages in the current quarter? Now you have already seen two months. You did Rs 1,540 crore last quarter. Will it be at least less in Q3?
A: In Q3, slippages would be less but only slippages which are likely to come are likely to come from large ticket accounts.
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