Catholic Syrian Bank files for Rs 400-cr IPO

Shortlists three for CEO post; eyes 20% growth in FY15

Private sector lender Catholic Syrian Bank (CSB) has filed for an initial public offer (IPO) to raise about Rs 400 crore. CSB is one of three commercial banks in the country which is not listed.

The Thrissur-based lender is raising funds to boost capital and business growth reported a net loss of Rs 18 crore during the half-year period ended September 30. The lender had reported gross non-performing assets of 5.56 per cent of gross advances and net non-performing assets of 3.76 per cent, as on end-September.

However, the bank’s management is confident of a favourable response from the IPO.

“We have recently concluded a rights issue where we raised Rs 113 crore. The issue was subscribed 126 per cent,” said S Santhanakrishnan, non-executive chairman of the bank.

“Apart from boosting the capital adequacy ratio, the IPO proceeds will be used for business growth. We are going to focus on small and medium enterprises, agriculture and the gold loan segment,” he added.

The lender, which has 430 branches, predominantly in the southern part of the country, has a loan book of close to Rs 9,500 crore, with a deposit base of Rs 14,000 crore. The old-generation bank, which focuses on business from non-resident Indians (NRIs) in Kerala, is eyeing 20 per cent business growth this financial year. Kerala gets $26 billion (Rs 1.53 lakh crore) a year in remittances.

The bank had hired a professional chief executive officer, Rakesh Bhatia, in April 2013. He resigned in January citing personal reasons. Bhatia was with HSBC before coming to CSB. The bank has shortlisted three candidates for the chief executive officer’s post and sent the list to the Reserve Bank of India. Sources indicate, Anand Krishnamurthy, who heads the wholesale banking and treasury operations in CSB, has been identified as the preferred candidate.

Krishnamurthy was earlier a colleague of Rakesh Bhatia at HSBC.

The bank has a diversified shareholding pattern with none of the top 10 shareholders holding more than five per cent of equity. NRI investor Yusuff Ali M A,  the chief of the Dubai-based LuLu Group, has the highest stake in the banks (4.98 per cent), followed by another Kerala-based private sector lender, Federal Bank (4.62 per cent).