Uco, Punjab & Sind get capital facelift | india | Hindustan Times
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Uco, Punjab & Sind get capital facelift

india Updated: Oct 20, 2008 22:27 IST
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The big banks are safe and smaller ones are getting a face lift. The government on Monday sought parliament approval to restructure the capital base of state-owned Uco Bank and Punjab & Sind Bank, aiming to help them lower their equity that would increase earning-per-share as they dress up go public.

A supplementary demand for grants Finance Minister P Chidambaram said the government plans to convert Rs 250 crore of Uco Bank’s equity into “perpetual non-cumulative shares,” while Rs 560 crore of Punjab and Sind Bank will be converted into similar debt instruments.

Of the total Rs 560 crore, Rs 160 crore will be converted into innovative perpetutal debt under tier-I, Rs 200 crore in perpetutal non-cumulative preference shares under tier-I while the reset Rs 200 crore into perpetual cumulative preference shares under tier-II. “This was much required but we will be looking at other channels too to raise capital,” a senior official of the bank told Hindustan Times.

Earlier, P&S Bank was looking at launching an initial public offer of shares. But poor market conditions forced the bank to put the plan in cold storage, waiting for better days.