Banks to raise Rs 10,000cr in CY05

Public offers of at least 11 PSU banks, worth about Rs 9,000-10,000 crore, are slated to flare up the capital market this year.

Some banks like Punjab National Bank (PNB), Oriental Bank of Commerce (OBC) and Allahabad Bank may tap the market by March to raise over Rs 5,500 crore. Dena Bank is already in the process of raising Rs 216 crore.

Other PSU banks like Bank of Baroda, Canara Bank, Andhra Bank, Vijaya Bank, Syndicate Bank and UCO Bank are expected to tap the market after March.

Central Bank of India and Indian Bank are also contemplating their maiden public offers.

Banks are rushing to the market to raise capital so as to carry on their business expansion while making adequate provisions to meet the stringent Basle-II norms by 2006.

The biggest issue will be from PNB, which is planning to raise close to Rs 3,000 crore. The bank got government's nod to issue eight crore shares early this month, and has already filed the prospectus with Sebi.

"We have appointed six merchant bankers to manage the issue. We are awaiting Sebi's nod for the public offer," PNB chairman S S Kohli said.

Oriental Bank is also rushing to draw up its prospectus and file it with Sebi early next month, chairman B D Narang said. OBC plans to raise up to Rs 1,800 crore from its second public offer.