Public sector bank, Allahabad Bank is planning to increase its merchant banking arm called AllBank Finance Ltd. It presently operates only in the eastern part and wants to increase by getting out of the east.
J P Dua, chairman and MD, Allahabad Bank said, “The merchant banking arm has just completed one mandate, and we have a few more in hand. We have reconstituted the subsidiary’s board and are now focusing on volumes.
The merchant banking outfit would be expanded to 5-6 cities starting with Delhi. We want to open more branches in places where we have a smaller presence such as the south, and parts of north India. These regions offer tremendous potential, we want to tap it.
He added, “We have the Reserve Bank of India’s authorisation for opening 68 branches during this fiscal. We also plan to start 100 ATMs this year”.
AllBank Finance presently has a net worth of about Rs 44 crore.
The bank anticipates to get capital infusion valued at Rs. 1000 crore in the next 6 months.
It had a capital adequacy ratio (CAR) of 13.62% as of March 31, 2010.
Dua said, “Our CAR is above 12 per cent and the Tier I capital is also more than eight per cent at about 8.02 per cent. We have, however, sought Rs 1,000 crore from the government during this financial year to fund our growth targets. We understand that our application has been processed by the government. We expect to get it in the next six months”.
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