Syndicate Bank expects to receive additional capital of Rs 539 crore this year.
“We have already made an application to the government of India for Rs 539 crore,” said Mr M.G. Sanghvi, Chairman and Managing Director, Syndicate Bank. The bank would get the funding through the preferential share allotment route, he said.
The bank’s capital adequacy ratio stands at 12.24 per cent, with tier-I capital at 8.94 per cent. The bank got Rs 327 crore through Life Insurance Corporation of India last fiscal.
“We need additional capital to fund our credit growth this year,” a top official of the bank told Business Line. The Government recently rolled out the Basel III guidelines, which states that a bank should have 7 per cent pure equity, he pointed out. The official added that Syndicate Bank’s pure equity stands close to 8 per cent now.
With tier-II capital over 3 per cent, the bank has enough headroom to raise funds in case of need, he said. “If interest rates come down, we will look at that option also,” he added.