Bandhan Bank, one of the two lenders that received the universal banking licence in April 2014, will be hitting the capital markets with an initial public offer ‘as soon as possible’, said Chandra Sekhar Ghosh, the bank’s MD and CEO, in an interaction with The Hindu .
Three-year deadline
Reserve Bank of India’s new bank licence norm requires a bank to be listed within three years of commencing operations. The other lender that received the licence, IDFC Bank, is already listed on the exchanges.
“One of the objectives of the IPO is to strengthen the capital base for future growth of the bank,” Mr. Ghosh said while explaining the rationale behind the IPO.
“Second, as per as the licensing norms, a bank needs to get listed within three years of starting operations. We started operations in August 2015,” he added.
The Kolkata-headquartered bank, which converted itself from a micro-lender, has filed a Draft Red Herring Prospectus with the Securities and Exchange Board of India for an IPO of up to 11.9 crore equity shares of face value of ₹10 each.
“If we are able to sell 12 crore shares, then the dilution will be 10%, after the IPO,” according to Mr. Ghosh.
When asked about the timing of the initial public offer, Mr. Ghosh said, “As soon as possible… it depends on regulatory clearances and on the market conditions.”
‘Rise in income’
The lender had reported a more than 18% growth in net profit for the quarter ended September to ₹331 crore — driven by a substantial rise in both net interest income and non-interest income.
During that quarter, its loan book had grown by 23.42% to ₹22,111 crore, while deposits recorded a growth of 42.29% to ₹25,442 crore.
Bandhan Bank’s gross non-performing assets were 1.26% as on September 30, while its net NPAs stood at 0.67%. The bank’s capital adequacy ratio stood at 26.25%, with the tier-1 capital ratio at 24.86%.
