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ICICI Bank has received capital repatriation aggregating $100 million from its wholly-owned banking subsidiary in the UK, ICICI Bank UK PLC.
The repatriated amount comprises redemption of $50 million of preference share capital and return of $50 million of equity capital, after receiving requisite approvals, the bank said in a statement.
ICICI Bank UK had a capital adequacy ratio (CAR) of 31.5 per cent at December 31, 2012. Post the repatriation, the capital base of the UK arm is $ 495 million and its capital adequacy ratio continues to be strong, the bank said.
CAR is a measure of the financial strength of a bank. It is expressed as a ratio of a bank’s capital to its assets.
The return of capital would further improve ICICI Bank's capital adequacy ratio and enhance its ability to optimise capital deployment and return on equity, the statement said.
As at December-end 2012, India’s largest private sector bank had a capital adequacy ratio of 19.53 per cent. The $100 million capital infusion will marginally improve this ratio.
Following the capital infusion and expected dilution of stake in its insurance subsidiaries (once the FDI is upped to 49 per cent), the bank may not need to tap the capital market for resources for the next four to five years, say analysts.
Shares of ICICI Bank closed at Rs 1,093.80 a share, up 3.36 per cent over the previous close, on the BSE.
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