State Bank of India is hopeful of getting the Government's nod for its rights issue by the second or third quarter of the current fiscal, according to its Chairman, Mr Pratip Chaudhuri.
“The Government had asked us to submit the revised rights issue proposal post the March 2011 results. We will soon submit our proposal and are hopeful of receiving their communication by the second or third quarter of the current fiscal,” Mr Chaudhuri said while talking to newspersons on the sidelines of a press conference to announce the bank's annual results here on Tuesday.
The bank plans to raise about Rs 20,000 crore by way of rights issue. “There will not be any difficulty getting capital. Our bank was not accommodated last year so it (capital infusion) has spilled over to this year. We are in talks with the Government and are hopeful that it will subscribe to full 59 per cent,” he said.
Meanwhile, SBI is looking at optimising its capital and looking at assets that require less capital. The bank is sitting on ample liquidity and has a comfortable capital adequacy ratio of 11.98 per cent which could support a growth of about 20 per cent during the current year, he observed.
The loan growth during the current year could be lower than the targeted rate of 20-22 per cent. “With the rise in interest rates, there could be some moderation in growth of assets. We are not pushed to the wall for loan growth. We might also have to contain asset growth if the rights issue does not come through,” he said. The bank would also lay an increased thrust on the corporate sector, he added.
Lending to microfinance
Talking about lending to the microfinance segment, he said, “Microfinance companies will have to fend for themselves. We will lend if they are adequately capitalised otherwise we can also do a good job in direct lending ourselves.”
On the international front, the bank's asset book grew by 13 per cent during the current year and it was hopeful of achieving about 12-15 per cent growth during the current year.