BUSINESS

Recap of Centurion Bank on course — Talwar

MUMBAI DEC. 4. BankMuscat, Sabre Capital Worldwide Inc. and Keppel Corporation, Singapore, signed the shareholders agreement today as stakeholders in Centurion Bank.

Under this agreement, BankMuscat and Sabre Capital will have two representatives each on the board of Centurion Bank, while Keppel will have one representative. Rana Talwar, Chairman, Sabre Capital, will be the Chairman of the bank.

"The recapitalisation scheme of Centurion Bank is on course," said Mr. Talwar while addressing a press conference here today. "The commitment of funds is far in excess of the required Rs. 154 crores.

The first phase of capital infusion will fully comply with the existing government regulations with regard to foreign investment in banks. Funding will be from a mix of foreign direct investment (FDI), up to 49 per cent including the existing FDI holding, FIIs, domestic mutual funds and domestic investors," he added.

A rights issue of Rs. 65 crores will follow the first phase of capital infusion of Rs. 154 crores. The bank has appointed JM Morgan Stanley as the lead manager to the rights issue.

The shareholding pattern post-rights issue will comprise BankMuscat 26 per cent, Keppel 11 per cent, public 28 per cent and Sabre 7 per cent. ADB and IFC will hold a 4 per cent stake in the bank. Centurion Bank and BankMuscat have received approvals from the Mumbai High Court (Goa Bench) and the Karnataka High Court for the restructuring and infusion of fresh capital, as well as the merger of the Bangalore branch of BankMuscat, on the basis of the proposals submitted by Sabre Capital. Mr. Talwar said Centurion Bank would immensely benefit from these investments as it will get access to NRI funds and trade finance opportunities with Gulf countries.

"This investment in Centurion Bank is an integral part of our strategy of becoming one of the foremost banks in the Gulf. Through this investment, we will provide Centurion customers a window to the entire region," said Sheikh AbdulMalik bin Abdullah Al Khalili, Chairman, BankMuscat. The retail segment will be one of the focus areas of the bank, said Mr. Talwar. On an asset management company, Mr. Talwar said he would prefer to start an asset management company with Centurion Bank.

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