Vijaya Bank planning to raise Rs 600 cr upper tier-II capital

Vijaya Bank is planning to raise Rs 500-600 crore upper tier-II capital in the current financial year. Chairman and Managing Director Prakash P Mallya said, "We might be raising Rs 500-600 crore upper tier-II capital during the current financial year, if required. We have recently raised Rs 250 crore lower tier-II capital."

Recently, the bank raised capital at 9.25 per cent interest rate, he added.

Mallya said the bank still had headroom to raise another Rs 200 crore capital through lower tier-II bonds. Currently, Vijaya Bank's capital adequacy ratio (CAR) stands at 11.55 per cent.

The bank will take a decision pertaining to revision of its prime lending rate (PLR) in two-three weeks. It had, in May, raised its PLR to 11.25 per cent from 11 per cent.

"We are looking into the matter. Considering the market scenario, we will take a call regarding revision of PLR within the next two-three weeks," Mallya said. If there was any upward revision, it could be up to 25 basis points, he added.

Meanwhile, the bank is eyeing a total business of Rs 60,000 crore in 2006-07, compared with last year's figure of Rs 46,800 crore.

It also targets to grow deposits to Rs 36,000 crore from Rs 28,884 crore in 2005-06, while expecting advances to touch Rs 24,000 crore from Rs 17,916 crore a year earlier.

The bank was awaiting the Reserve Bank of India approval for opening representative offices in China, Dubai and Hong Kong, he added.

Vijaya Bank has also firmed up massive expansion plans. "We will have 1,000 branches across the country by the year-end, from the present figure of 924 branches. Twelve branches will be in the eastern region.

Besides, the bank is set to double its network of ATMs to 250 this year, compared with 125 ATMs last year. Moreover, the bank, this year, would be focusing on the agri business and the small and medium segment, the CMD said.