By IANS,
Kolkata : State-run United Bank of India (UBI) Friday received the central government’s nod for its maiden initial public offering (IPO), which will be launched by the first week of February next year.
“We received the government approval today (Friday). The RBI (Reserve Bank of India) approval had come earlier,” UBI chairman and managing director S.C. Gupta told reporters here.
The bank hopes to raise Rs.350 crore-Rs 360 crore from the IPO by floating 50 million new shares of Rs.10 face value at a premium.
The tentative price per share will be between Rs.70 and Rs.75, Gupta said.
As part of capital restructuring, the union government has reduced equity capital from Rs.1,532 crore to Rs.266 crore by allowing transfer of Rs.1,266 crore to the capital reserve account.
With the reduction in equity, the government’s share in the bank will become 84 percent post-IPO from the present 100 percent.
“With this, the book value of Rs.10 per share has gone up to Rs.104 per share,” Gupta said.
Giving details of the bank’s recent financial performance, he said its net worth shot up to Rs.2,763 crore in September from Rs.2,609 crore in March 2009.
The bank achieved a total business of Rs.105,959 crore in the first half of 2009-10, recording a year-on-year growth of 41.4 percent.
The deposits soared to Rs.64,740 crore registering an annual growth of 43.1 percent while gross advances increased to Rs.41,219 crore recording a growth of 38.7 percent on year-on-year basis.
Gupta said the bank’s net profit stood at Rs.154 crore during the first half of 2009-10 as against Rs.184 crore during the whole of 2008-09.
However, UBI’s plan to add 128 more branches during the year has had a slow start and only 12 could be opened till November.