Dhanalaxmi Bank plans Rs350 cr QIP fund-raising in July

Private sector Dhanalaxmi Bank plans to raise Rs 350 crore through a qualified institutional placement (QIP) by the third week of July, a top bank official said.
       
"We plan to raise Rs 350 crore through a QIP by the third week of next month. We will be diluting around 23 per cent of our equity," Dhanalaxmi Bank's managing director & CEO, Amitabh Chaturvedi, told PTI here today.
       
The resources raised will be used to fuel the bank's business.
       
"We want to up our advances from the present Rs 5,100 crore to Rs 9,000 crore in FY 11. The funds raised will be used towards this," he said.

The bank now plans to strongly focus on the retail segment and by end-this fiscal, it aims to lend at least 30% (of its total advances) to this segment.

"Our aim is to have a lending of around 40 per cent to large corporates and 30% each to the SME and retail segments by end FY 11," Chaturvedi said.

With its retail portfolio very small, even around Rs2,500 crore of new retail lending will take it up to 30%, the Dhanalaxmi Bank chief said.

The bank's lendings to SMEs now comprise 15-17 per cent of its total loan-book.
       
Post the QIP, the bank's capital adequacy ratio will increase to 16% from the present 12.5%, he said. By end-this fiscal, it will again stand at around 12%.

"It is our policy not to allow our capital adequacy to slip below 12 per cent," Chaturvedi said.
       
The bank has appointed IDFC-SSKI and JM Financial as its investment bankers (for the QIP).