Bob Keen On Benares Bank Takeover

Bank of Baroda (BoB) has conveyed its interest in taking over the beleaguered Benares State Bank Ltd (BSB) to both the Reserve Bank of India (RBI) and the Centre, provided the shortfall between the assets and liabilities, if any, is made good.

The bank, which made its position known on the issue of amalgamation a few months back, is yet to hear from the Union government and the banking regulator in this regard.

"BoB, with 550 branches in Uttar Pradesh, is the convenor of the state-level bankers committee (SLBC). If BSB, which has a total of 105 branches, is amalgamated with us, we will have 90 additional branches in the state. We have already conveyed our interest in BSB to the authorities," P S Shenoy, chairman and managing director, BoB, said on sidelines of the launch of 'Paras Credit Card' of BoB Cards Ltd, the wholly owned subsidiary of BoB, in association with MasterCard International.

As on March 31, 2001, BSB had deposits of Rs 1,031 crore, extended credit to the tune of Rs 229.96 crore; and made investments of Rs 630.90 crore.

On whether the bank is planning a rights issue, Shenoy said: "We are comfortable as far as the capital adequacy ratio (CAR) is concerned, which as at March-end 2002 was at 11.32 per cent. For the next two years there will be no requirement for fresh capital. Our scrip has moved up from Rs 48 to Rs 60 in the last one week. If the market sentiment improves further, we may think of the rights issue."

Meanwhile, Bank of Baroda is planning to introduce a debit card by September. The bank plans to open two branches in the US - in Texas and California - and a subsidiary in Tanzania. Further, it has set its sights on opening a branch in the offshore financial centre at Malaysia and has obtained restricted licence to convert the Hong Kong-based BoB International Finance Ltd into a bank.

"We are looking at increased presence in south-east Asia as the economies are growing fast. We are exploring the possibility of having a presence in Singapore," Shenoy said.

The bank, which has customer base of two crore, was looking at opening branches in Texas and California in addition to the existing one in New York, he said.