OBC plans to mop up Rs 350 crore

Oriental Bank of Commerce (OBC) plans to raise about Rs 350 crore capital to grow and maintain a comfortable capital adequacy ratio (CAR). The money will be raised through upper Tier-II bonds, or perpetual bonds, during the current fiscal.

“We have a headroom of Rs 4,300 crore for raising Tier-II capital and plan to raise Rs 350 crore from perpetual bonds to support the targeted business growth of 23-25 per cent during 2009-10,” S C Sinha, executive director, OBC, told Business Standard.

Sinha, who was here to inaugurate the new building of the bank’s regional office, said the bank would need an additional capital of Rs 1,000 crore in the next fiscal.

The bank, which raised Rs 500 crore as upper Tier-II capital in February this year, had a CAR of 12.98 per cent at the end of March 2009, according to Basel-II norms.

It achieved a total business mix of Rs 1,67,000 crore till March 2009 and is aiming at a business of Rs 2 lakh crore by March 2010.

As a step in this direction, the bank will open 113 new branches in the current fiscal, taking the total to more than 1,500.

It has already got licences from the Reserve Bank of India (RBI) for the branches. It also plans to open more than 100 branches during 2010-11 in un-banked areas.

The bank plans to add more than 100 ATMs during the current fiscal, taking the total to over 900.

On recruitment, Sinha said many employees were going to retire in 2011-12. Keeping that in view, the bank intends to come out with a recruitment policy. This is expected to figure in the discussion of the board of the bank, which is likely to meet in July or August this year.

The bank recruited 1,600 employees last financial year, including 900 clerical staff, 140 specialist officers, 300 probationary officers and 255 field level officers.