Karnataka Bank Announces Rights Issue, Recast

Private sector Karnataka Bank has announced a rights issue and has decided to restructure the bank's operations.

The bank's chairman and chief executive officer, Ananthakrishna told shareholders at the annual general meeting that the bank has decided to go in for a rights issue worth Rs 13.5 crore at a premium of Rs 15 per share to increase its capital adequacy ratio, which is around 13 per cent at present.

He said the bank has decided to restructure its operations and standardise its corporate brand. It has hired National Institute of Bank Management to submit a report on the restructuring and business process re-engineering.

Ananthakrishna said the bank has as per its new mission statement, decided to be a technology savvy, customer centric progressive bank with a national presence driven by the "highest standards of corporate governance and guided by sound ethical values".

Ananthakrishna said the total business of the bank has crossed Rs 10,000 crore while total deposit rose 15.24 per cent to Rs 7,001.48 crore during 2001-02 compared with the previous year.

The bank's net profit rose 100.68 per cent to Rs 91.13 crore compared with the previous year. The bank expects to achieve a total business turnover of around Rs 12,750 crore during the current year. Net advances increased 20.84 per cent to Rs 3,417.54 crore compared with the previous year while investments increased 24.4 per cent to Rs 3,467.15 crore.