UCO Bank to raise Rs 625 cr

UCO Bank is all set to raise Rs 625 crore through the perpetual non-cumulative preference shares (PNCPS) route in a bid to support its immediate asset expansion plans.

Of this, Rs 325 crore would be raised by March end to augment Tire I capital of the bank and the remaining Rs 300 crore would be raised later by way of alloting to the government.

"The decision with regard to converting Rs 300 crore equity into preferential shares is pending with the government," said SK Goyal, chairman and managing director, UCO Bank. The Reserve Bank of India has already issued guidelines on raising capital through the PNCPS route and UCO Bank would be the first to avail this option.

Meanwhile, the bank is also considering a follow-on public offering (FPO) for raising its equity base. "We are ready for the FPO and as soon as the market stabilises we would opt for it," Goyel added.

The bank has already worked out that around Rs 900 crore would come under the farm waiver scheme. "We have already submitted our figures to the government," Goyel said.

The agricultural non-performing asset (NPA) of the bank is around Rs 308 crore and the bank had provisioned Rs 117 crore in this regard.

The Kolkata-based public sector bank is expecting to cross Rs 1,30,000 crore mark in business by the current financial year end and credit growth is likely to be around 17 per cent.