Indian Bank Board nod for Govt Rs 280 cr capital infusion

Bank to hold shareholders EGM on March 23

The Board of Directors of Indian Bank has given nod for the Government proposal to infuse Rs 280 crore in the bank by way of preferential equity allotment.

The Board of Directors of the Bank has, in its meeting held on February 14, 2015, approved the proposal. The Board also decided to convene an Extraordinary General Meeting (EGM) of the shareholders of the Bank for obtaining their approval for the proposed Preferential issue to the Government of India. The EGM has been fixed for March 23, 2015.

T M Bhasin, chairman and managing director of Indian Bank, earlier said that the government had decided to infuse capital in five public banks, including Indian Bank. "The decision (government's) was based on our efficiency," said Bhasin,

The government had looked at return on assets (ROA) and return on equity (ROE) for the last three years, he added.

According to the bank, the average ROE for the last three years for them had been at 15.08 per cent, whereas the ROA at one per cent. Indian Bank claims it is the best among the PSU banks.

Post the fund infusion, the union government's stake in the bank would increase to 81.80 per cent from 81.50 per cent, said Bhasin.

Indian Bank reported a five per cent rise in net profit at Rs 277.52 crore during the quarter ended December 31, 2014, when compared with Rs 264.50 crore for the same period a year ago.