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THIRUVANANTHAPURAM, March 22

UTI Bank, one of the leading new generation banks in the country, is planning to come out with a public issue some time in the next financial year if the market conditions prove to be favourable.

The bank is already in the process of bringing down the equity holding of UTI, the promoter, from 44.88 per cent to 40 per cent, in line with the RBI guidelines, through private placement, according to Dr P.J. Nayak, Chairman and Managing Director of the bank.

Earlier, the promoter's stake had come down to 44.88 per cent from 61.90 per cent consequent to CDC Financial Services (Mauritius) Ltd and South Asia Regional Fund taking up 26.01 per cent in the bank's equity.

Dr Nayak told newspersons here on Friday that the bank was looking at the possibility of coming out with a public issue to expand the equity base. However, if the market conditions turn out to be unfavourable, it may consider going in for private placement.

Dr Nayak, who was here in connection with the opening of the bank's new branch in the city, its 107th in the country, said the branch network will be expanded to 140 during the next financial year. The number of ATMs will also go up to 800 from 470 as of now.

The bank has entered into a tie-up with BNP Paribas for sharing the ATM network. Similar arrangements with other banks are also under discussion, he said and added that 92 per cent of all retail cash transactions and 86 per cent of all cash transactions of the bank are being done through ATMs.

While ruling out the possibility of going in for acquisition of other banks, Dr Nayak said UTI Bank is looking at growing "organically'' and not through mergers. As of now, the priority is for buying out the portfolios of other banks.

Recently, the bank has bought out portfolios worth Rs 917 crore from ICICI Bank and a similar buy-out will take place in the coming weeks.

He informed that the total deposits of the bank are expected to reach Rs 12,500 crore in the current year and the advances Rs 6,400 crore.

The balance sheet of the bank is also expected to show a growth of 40-50 per cent.

Besides, the profit has been growing at the rate of 55 per cent annually over the last three years and the momentum is expected to be maintained in the current year also.

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