Indian Bank (INBK), a state-owned lender, plans to raise as much as $1 billion selling medium-term notes and use the proceeds to boost loans in Sri Lanka and Singapore.
The bank will sell the 5 ½-year debt overseas in two phases, Executive Director V. Rama Gopal told reporters today in Chennai, where the company is based. The sale may start after three months, he said.
The 103-year-old bank is betting the fastest pace of growth in more than three decades in Sri Lanka will boost demand for loans. The lender also expects low interest rates in Singapore to attract Indian companies to borrow in the city-state. Indian Bank’s profit rose 10 percent, the slowest pace in six years, in the 12 months ended March 31.
“Almost all Indian corporates are setting up offices in Singapore,” and they want to borrow in the city, Chairman and Managing Director T.M. Bhasin said in an interview today. In Sri Lanka there’s demand to borrow to build infrastructure and gain from economic growth in the nation, he said.
Indian Bank’s rose 0.2 percent to 239.35 rupees on April 21 in Mumbai. The shares have declined 3 percent this year, compared with a 1 percent gain in the Bombay Stock Exchange’s Bankex index.
Indian Bank expects its balance sheet to almost triple to 5 trillion rupees ($112.6 billion) in the next four years, Bhasin said.
Sri Lanka’s economy expanded 8 percent in 2010 from a year earlier, which is the most since 1978 and compares with a 3.5 percent gain in 2009.
Tamil Tigers
Companies including Shangri-La Asia Ltd., Nestle Lanka Plc and India’s Delta Corp. are boosting investments after President Mahinda Rajapaksa’s government ended the Liberation Tigers of Tamil Eelam’s quest for a separate homeland in 2009, bringing an end to conflict.
Bharti Airtel Ltd., India’s biggest mobile-phone services company, and Shapoorji Pallonji & Co. are among companies that have approached Indian Bank to borrow in Singapore, Bhasin said. The prime lending rate in Singapore is 5.38 percent, while the minimum rate at State Bank of India, the nation’s biggest, is 8.5 percent, according to data compiled by Bloomberg.
The lenders’ profit in the three months ended March 31 rose 7.3 percent to 4.39 billion rupees, the lender said in a filing to the Bombay Stock Exchange today. Total income rose to 28.65 billion rupees from 23.17 billion rupees.
To contact the reporter on this story: Ganesh Nagarajan in Chennai at gnagarajan1@bloomberg.net
To contact the editor responsible for this story: Arijit Ghosh at aghosh@bloomberg.net
source - www.bloomberg.com/
0 comments:
Post a Comment