Canara Bank plans initial public offering

Bangalore: Canara Bank is planning to come up with an initial public offering (IPO) of Rs 175 crore to Rs 225 crore in August or September 2002. The work towards fixing the issue price and the appointment of merchant bankers will begin this month.

Currently Canara Bank has an equity capital base of Rs 578 crore, says Canara Bank chairman R V Shastri.

Declining to detail the possible premium on the forthcoming issue, Shastri says: Though there will be a good premium, it will be made affordable to the public. The bank also rules out the book-building route to subscribe the issue. We will go to the public directly.

Canara Bank has decided to come out with the IPO irrespective of the prevailing market conditions. The tier-II capitalisation route is not attractive because securities are treated as subordinated debts as long as the maturity period does not exceed five years.