Canara Bank, the country’s third largest bank, has set its sights on mid-sized Dena Bank and has appointed Ernst & Young to explore the possibility of the deal. This sets into motion the government’s move to introduce consolidation among public sector banks.
Sources close to the development said the chairmen of both banks would meet shortly, after which the matter would be taken up by the respective boards and employees would be consulted.
Bangalore-based Canara Bank, which has a network of 2,542 branches, is strong in the south while Mumbai-based Dena Bank, with its 1,050 branches, has a large presence in Maharashtra, Gujarat and Chhattisgarh. It overtook Punjab National Bank in 2005-06 to become the country’s second-largest public sector bank in terms of advances and deposits.
The merger will help Dena Bank, which has just come out of a huge burden of sticky loans or non-performing assets (NPAs). Though it is now better off financially, it has a limited capital base to grow business at the rates that the banking sector has seen in the last three years.
Read more in The Business Standard article.
Showing posts with label Punjab National Bank. Show all posts
Showing posts with label Punjab National Bank. Show all posts
Wednesday, May 9, 2007
Saturday, March 24, 2007
IFCI to sell 26% stake to strategic investor
IFCI Ltd will divest at least 26% of its stake to a strategic investor through fresh issue of shares. The board of the financial institution has decided to appoint management consultant Ernst & Young to look for the strategic investor, IFCI told BSE.
The move is aimed at bailing out the ailing financial institution. In 2002 and 2003, government tried to merge the institution with Punjab National Bank. But, the move failed as the bank found the deal very costly as IFCIhad huge bad loans on its books. Government also tried to merge the institution with IDBI, which also failed.
Meanwhile, government so far has infused around Rs 4,600 crore in IFCI to revive it. The 2007-08 budget announced Rs 1,300 crore fresh infusion in the institution to meet its restructuring liabilities, including payment for outstanding loan of Rs 880 crore. To raise funds, the IFCI also sold its 7% stake in NSE and 8% stake in the ICRA through offer for sale.
Read more in The Times of India article.
The move is aimed at bailing out the ailing financial institution. In 2002 and 2003, government tried to merge the institution with Punjab National Bank. But, the move failed as the bank found the deal very costly as IFCIhad huge bad loans on its books. Government also tried to merge the institution with IDBI, which also failed.
Meanwhile, government so far has infused around Rs 4,600 crore in IFCI to revive it. The 2007-08 budget announced Rs 1,300 crore fresh infusion in the institution to meet its restructuring liabilities, including payment for outstanding loan of Rs 880 crore. To raise funds, the IFCI also sold its 7% stake in NSE and 8% stake in the ICRA through offer for sale.
Read more in The Times of India article.
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