City Union Bank to raise Rs.250 crore through rights issue

Chennai -  City Union Bank will raise Rs.250 crore through a rights issue this year to meet its growing business needs and capital adequacy ratio (CAR), said a top bank official.

"We have filed the necessary papers with SEBI (Securities and Exchange Board of India) last month. The issue price and the ratio of rights issue are yet to be decided," N. Kamakodi, managing director and chief executive officer, told reporters here Friday while sharing the bank's first quarter results.

The private sector bank presently has a CAR of just over 12 percent.

During the first quarter of the current fiscal, the bank has posted a net profit of Rs.73.89 crore, up from Rs.58.51 crore logged during comparable period of 2011-12.

The bank's total income went up to Rs.566.90 crore (interest income Rs.504.21 crore, non-interest income Rs.62.69 crore) from Rs.417.02 crore (interest income Rs.371.14 crore, non-interest income Rs.45.88 crore).

According to Kamakodi, the bank achieved a total business of Rs.29,835 crore (deposits Rs.17,062 crore, advances Rs.12,773 crore) during the period under review up from Rs.23,215 crore (deposits Rs.13,624 crore, advances Rs.9,591 crore) posted during first quarter of the previous fiscal.

The gross non-performing assets (GNPA) came down to 1.07 percent and the net NPA to 0.50 percent last quarter as against 1.22 percent and 0.51 percent respectively booked during comparable period of the previous year.