Lkb May Offer 20% To Foreign Bank

The Lord Krishna Bank is planning to place a 20 per cent stake with an international bank ahead of its initial public offer (IPO).

The bank is also looking at growing its balance sheet through acquisitions. In fact, it has initiated talks with a couple of banks based in western and northern India.

Ashwani K Puri, director, Lord Krishna Bank, said: "We are looking at placing 20 per cent of our equity with an international bank which could bring in the latest technology and management know-how into the bank. Once this is done, we will come out with an IPO of around Rs 100 crore."

The bank had made a Rs 36 crore rights issue earlier this year. Post-issue, the Puri group holds more than a 50 per cent stake in the bank, while the Dabur group has five per cent.

"We are in talks with some of the banks in the west as well as north for inorganic growth. We are not interested in banks in Kerala as we are already there," Puri said.

Lord Krishna Bank had done a due diligence on Centurion Bank some time back through Deloitte Haskins and Sells to takeover the bank.

However, it has now shelved its plans. Sources said Lord Krishna was not satisfied with the quality of Centurion bank's assets. Puri, however, said: "Centurion Bank has presence in most of the places where we are, and that's why we are not interested in it."

"The group could have taken over the bank and then merged it with Lord Krishna Bank or the bank could have gone in through one more rights issue and then used the proceeds to take over the bank had we chosen to do so," he said.

Lord Krishna Bank has a net worth of Rs 109 crore as on March 31, 2002. It currently has 94 branches and plans to add another 25 by the end of the year -- eight in the west and the rest in the north.