The Hindu Business Line : City Union Bank likely to come out with public issue

He said that the bank's capital adequacy ratio, already at a comfortable level of 12.3 per cent, would only increase after Basel-II norms are implemented, because nearly 70 per cent of the bank's loan assets are `retail' by definition.

Further, the bank has headroom to raise Rs 120 crore through tier-II issues (long term debt), which is also on plan. Besides, the bank expects to reach the stipulated net worth of Rs 300 crore through internal accruals.

As such, there is no pressure on the bank to raise capital. However, Mr Balasubramanian said a tier-I issue was under plan to fund the bank's further expansion of advances. The bank has plans to reach a total business of Rs 10,000 crore by 2007-08, from around Rs 6,000 crore now.

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