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Indian bank declares div of Rs 101 cr after 12 years

For the first time Indian Bank has made a net profit of Rs 504.48 crore during 2005-06.

india Updated: May 31, 2006 16:10 IST

For the first time Indian Bank has made a net profit of Rs 504.48 crore during 2005-06, a top executive of the bank said on Wednesday.

The bank, entering its centenary year on August 15 this year, had declared a 'historic' dividend of Rs 101 crore to Government of India, after a gap of 12 years. Last time the bank had paid the dividend of just Rs 50 lakh in 1992-93, Bank's Chairman and Managing Director KC Chakrabarty told a news conference.

The bank has given stellar performance in 2005-06 going forward we expect our business volume to go up by 20 per cent and 25 per cent appreciation in credit line during the current fiscal 2006-07, he said.

The bank would be coming out with a public issue some time next year. "The cabinet had already approved it," he added.

Chakrabarthy said the capital base of the bank stood at Rs 743.82 crore upon 'netting off' the accumulated losses, as permitted by the government.

The overall business of the bank stood at Rs 63,290 crore as on March 31 this year, which included deposits of Rs 40,805 crore. Return on average assets improved to 1.16 per cent in 2005-06 as against 1.08 per cent in the previous year. "The figure of more than one per cent is considered a respectable figure in international standards," he said.

On the plans for 2006-07, he said the deposits were likely to grow by 16 per cent and the gross NPA to come down to less than two per cent from 2.91 per cent now.

The bank had brought 506 branches under the Core Banking Solution, covering over 70 per cent of overall business and benefitting 7.3 million customers and the Indian Bank was the 'fastest' CBS implementing bank in the country.

The bank had already entered into MoUs with PNB Principal Planners Pvt Ltd, for marketing mutual fund products and PNB Principal IAC Pvt Ltd, for marketing various insurance products of major players in the field.

The bank had also set up IB Bancassurance Service Centre to coordinate with various insurance companies for marketing life and non-life products. The bank also had already tie-up arrangements with asset management companies for marketing their mutual fund products.

He said the bank would revise the interest rates on domestic term deposits with effect from tomorrow. The rate would be increased from 5.6 per cent to six for the period 180 days to 364 days, from 6.25 per cent to 6.5 for the period one year to three years, from 6.75 per cent to seven for periods between three years and less than five years and from 7 to 7.25 per cent for five years and above.

First Published: May 31, 2006 16:10 IST