Uco Bank lines up follow-on offer

Kolkata-based Uco Bank is planning a follow-on offering in April 2007.

The bank, which came out with an initial public offering in August 2003, had raised more than Rs 200 crore at Rs 12 a share.

Chairman and managing director V Sridhar said the bank has already initiated discussion with RBI for the follow-on offering.

He was talking to reporters after announcing the tie-up between Reliance General Insurance and UCO Bank for personal accident insurance of the depositors.

According to Sridhar, the bank is hoping to come out with the offering in April-May adding that prior to the float, the bank might go for a capital restructuring.

UCO has a paid-up capital of Rs 800 crore, considered too large for a bank of its size. "After restructuring the capital, we shall go for tier 1 through follow on offering as our business is expanding rapidly," he said.

Sridhar said he was hopeful that the bank would be able to achieve the target of Rs 100,000 crore business by the end of this fiscal.

"Our second quarter results will be finalised shortly. I am optimistic that third and fourth quarter will be even better," he added.

The CMD said the bank was hoping to generate Rs 100 crore as non-fund based income in the first half of 2006-07 compared with Rs 60 crore for the whole of 2005-06.

"Our insurance and mutual fund distribution arm is also doing well. We have targeted Rs 20 crore from distribution this compared with Rs 6.5 crore in the last fiscal," he added.

Sridhar claimed that the charge levied by UCO-Reliance General combined, for personal accident benefit, was the lowest in the industry.

"We are charging one shot premium of Rs 6.99 for every Rs 100,000 sum assured under this scheme", he said.