Central Bank may hike stake in housing subsidiary

The Central Bank of India may hike its stake in its subsidiary,Cent Bank Finance Limited, in the next six months.

"Looking at the current market scenario, we would want to retain our housing subsidiary. We may even increase our stake in the company as some joint venture partners have expressed interest to divest," Central Bank chairman and managing director S Sridhar said here today on the sidelines of a banking conclave organised by FICCI.

The Central Bank holds 59 per cent in Cent Bank Finance Limited, Hudco and National Housing Bank holds 16 per cent each and the rest is held by UTI.

Sridhar said the process of increasing stake would be completed in the next six months. The subsidiary will complement Central Bank in home loan lending.

Central Bank said it would raise another Rs 350 crore as tier II capital during the year. In addition the government has also offered Rs 700 crore as recapitalisation to the bank.

Sridhar said the bank would issue preference shares and perpetual bonds to raise capital.