Corporation Bank seeks Rs 300-cr loan from govt

State-owned Corporation Bank has sought Rs 300 crore capital support from the government to fund business growth.

"We have requested capital infusion, they [the government] will consider it when they will review banking sector as a whole," said Corporation Bank Chairman and Managing Director Ramanath Pradeep.

"We have made a very small request for about Rs 300 crore...It will be by way of Tier I capital," he said on the sidelines of a PHD event. I don't need to raise capital at this point of time. My capital adequacy ratio is more than 14%," he added.

On the back of robust monitoring mechanism and system, the bank intends to become a zero net NPA bank by the end of the current fiscal.

"Because we have introduced very robust system of monitoring therefore we are confident that we should reach to that level zero net NPA level [by March 2012]," Pradeep said.

Current net Non-Performing Asset level of the bank stood at 0.47% at the end of June 2011.

Talking about the loan growth, Pradeep said, there is a possibility of moderation in credit growth on account of rising interest rate.

"Loan growth is expected to be lower than the original estimate. Our target is 25% on the loan side but probably there is need to revisit it to may be around 22%," Pradeep said.

Deposit growth would be also be lower at 20% against the original target of 22%, he said.

Source: Business Standard