IOB to raise Rs 850 cr selling non-core assets and investments this fiscal

The Bank is currently exploring stake sales in joint venture and other entities to help it raise over Rs 445 crore

Indian Overseas Bank (IOB) has announced plans to raise about Rs 850 crore this fiscal from the sale of non-core assets, including properties and investments. The lender is currently exploring stake sales in joint venture and other entities to augment resources and help it raise over Rs 445 crore.

K Swaminathan, executive director said, "The bank has, with various initiatives, turned around and the Capital Augmentation through these traditional ways will help it achieve the targeted profit in FY20."

As part of its strategy to unlock assets to raise capital, the lender has identified 32 properties for sale, including prime ones in Singapore and Hong Kong worth Rs 900 crore collectively. During 2018-19, it sold six properties -- one domestic and five overseas -- for Rs 129 crore, which helped in accretion to capital. 

The bank has already initiated the process for sales of the remaining 26 properties worth about Rs 775 crore and is engaging various stakeholders for expediting sales to derive maximum value in the process.

IOB has also initiated the process of unlocking value from non-core investments valued at Rs 72 crore to augment the capital. It may be recalled that the bank had added to its capital funds to the extent of around Rs 261 crore by issue of equity shares to employees under ESPS in fourth quarter of 2018-19.