IDBI Bank to launch issue

MUMBAI, JAN 18: IDBI Bank is entering the capital market with a public issue of 4 crore equity shares at a price of Rs 18 per share on Fe...

MUMBAI, JAN 18: IDBI Bank is entering the capital market with a public issue of 4 crore equity shares at a price of Rs 18 per share on February 9. The issue will mobilise Rs 72 crore and dilute the shareholding of IDBI and SIDBI to 71.43 per cent.

Addressing a press conference in this connection, the bank’s managing director, D K Mukherjee, said the premium of Rs 8 per share was based on the on its 234 per cent growth in total income and 446 per cent net profit growth at Rs 2005 lakh 1997-98, among other factors.

The bank has recorded a 265 per cent increase in deposits and 70 per cent growth in advances in the last financial year. Earnings per share stood at Rs 2.01 and net asset value Rs 12.44 per share. Its non-performing assets came down to 0.32 per cent from one per cent in 1996-97. However, advances to investment ratio also declined correspondingly.

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The bank also plans to offer internet banking and enter the smart card business. "But we don’t plan to get into the card business — it is very labourintensive," Mukherjee clarified.

Of the 4 crore equity shares on offer, 4 lakh have been reserved for the bank’s employees and 40 lakh for IDBI equity shareholders on a competitive basis. The shares will be listed at the Bombay Stock Exchange, National Stock Exchange and the Indore Stock Exchange.