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Strategies & Market Trends : India Coffee House -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (8014)	10/8/1999 9:52:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 12475

IPOwatch: Syndicate Bank - IPO at par syndicatebank.com Syndicate Bank IPO at par Our Bureau (blr) MUMBAI, Oct. 8 SYNDICATE Bank is to make an initial public offer (IPO) of 125,000,000 equity shares of Rs. 10 each for cash at par, aggregating Rs. 125 crores. The issue will open for subscription on October 25 and the earliest closing will be October 30. An amount of Rs. 5 is payable on application, and the balance of Rs. 5 is payable on allotment. Applications have to be made for a minimum of 200 equity shares and in multiples of 200 thereafter. Speaking at a press conference here today, Mr. K.V. Krishnamurthy, Chairman and Managing Director, Syndicate Bank, said, ``This is the first public issue of a public sector bank at par.' After the issue, the Government shareholding will come down from 100 per cent to 73.52 per cent. The paid-up capital of the bank is currently Rs. 346.97 crores and will move up to Rs. 471.97 crores after the issue. Mr. Krishnamurthy said the issue was being made to augment the capital base of the bank to meet the future capital adequacy requirements and to augment the long-term resources of the bank. At present, the capital adequacy ratio (CAR) of the bank is 9.57 per cent which is expected to move up to 10.25 per cent after the public issue. The bank is also planning to raise Tier II capital aggregating Rs. 60 crores through private placement to further bolster the CAR. Mr. Krishnamurthy said the bank had introduced a novel voluntary retirement scheme (VRS) in order to reduce its workforce. Under the scheme, employees have the option to take a maximum of three years `without pay' leave to scout for better alternatives. In the event of the inability to get an alternate job, the employee can then return to the bank. However, if the person is able to land up with another job within the three years, he/she can resign from the bank and also collect his VRS dues. According to Mr. Krishnamurthy, the scheme is employee friendly and will help the bank to cut employee costs. The CMD said the bank was also in talks with various term lending institutions such as ICICI Ltd to deploy its surplus staff. ``With many FIs going retail in a big way, there will be a demand for experienced banking professionals,' he said. Syndicate Bank has the highest workforce among public sector banks at 35,000. For the year ended March 31, 1999, the bank reported a total income of Rs. 2,357.60 crores and a net profit of Rs. 142.58 crores. The bank has projected a net profit of Rs. 236 crores for 1999-2000. The net NPA ratio of the bank is 3.93 per cent. Mr. Krishnamurthy said the bank had taken up automation and over 125 of its branches were fully automated and 313 partially automated. The bank had also recently availed of a $10-million World Bank loan to upgrade its technology. Pic.: Mr. K.V.Krishnamurthy, Chairman and Managing Director, Syndicate Bank, and Mr. H. Kothari, Chairman, DSP Merrill Lynch, at a press conference in Mumbai on Friday.