Saraswat Bank becomes the first urban cooperative bank in the country which has decided to offer Right Issue to its shareholders. The decision was announced on Monday on the occasion of the annual general meeting of the bank in Ravindra Natya Mandir, Prabhadevi Mumbai.
“Gautam Thakur, Chairman of Saraswat Co-operative Bank Ltd., announced at the 104th AGM that the Bank proposes to offer shares to its existing shareholders to the tune of Rs. 200 to 300 crores depending upon the CRAR percentage of the Bank as on 30th September 2022 by way of Rights Issue”, read a release from the Saraswat Cooperative Bank.
Thakur said that this will be the largest Rights Issue in the entire history of the Urban Co-operative Banking sector. He further said that the RBI and the Banking Regulations Act permit the issue of the shares to persons within the Area of Operations of the Bank.
“However, the Board has decided to offer shares to its existing members only, who have been part of the Bank’s growth story”, said the Chairman with clapping from the audience.
The Bank has decided to raise additional capital by way of the Rights Issue keeping in view the ambitious business growth and to have adequate capital as per BASEL III norms.
This will also help the Bank gear up on the capital front and be eligible for universal banking as a Tier IV Bank once the Report of the Expert Committee on Urban Co-operative Banks is implemented.
The proposal was received with resounding applause by the members present in the meeting. The members were also apprised of the growth of the bank in the last fiscal. Saraswat Cooperative Bank crossed a business mix of Rs 71,500 crore and earned a net profit of Rs 275 crore in the 2021-22 financial year.
The business mix of the bank increased from Rs 67,097 crore (2020-21 FY) to Rs 71,573 crore in 2021-22, i.e. a rise of Rs 4476 crore in absolute terms. As of 31st March 2022, the deposits of the bank grew from Rs 40,855 crore to Rs 42,870 crore, i.e. a rise of Rs 2015 crore, and loans and advances rose from Rs 26,241 crore to Rs 28,701 crore, i.e. a rise of Rs 2460 crore.
The Credit Deposit Ratio of the Bank improved to 66.95% as of 31st March 2022 from 64.23% in the previous year. Besides, the bank earned a net profit of Rs 275 crore. Earlier i.e. in 2020-21 it was Rs 270 crore. As of 31st March 2022, the gross and net NPA stood at 3.86 percent and 0.65 percent respectively. Own Funds have increased to Rs 4,181 crore as of 31/03/22 from RS 3937 crore as of 31/03/21.
Last week, the Saraswat Bank was felicitated by Union Minister Amit Shah on completing 100 glorious years.