Dhanalakshmi bank in tie-up talks

The need to increase the capital base has forced the Trissur-based Dhanalakshmi Bank to think about entering into tie-ups or strategic alliances. The bank is holding talks with financial players such as foreign banks, private banks and mutual funds.

By 2001, Dhanalakshmi Bank is planning to augment its capital base to Rs.100 crore, according to T M Venkatraman, chairman of the bank. He added that there was a positive response from the financial players and that the bank would have no reservations on the nature of fresh capital infusion.

If the current move falls through, the bank will issue shares on rights or private placement basis, though this will be kept as the last option to expanding the Tier II capital.

Dhanalakshmi Bank plans to increase profits by reducing cost of deposits through treasury management, increase in income from fee-based activities and foreign exchange business.

The bank recently got the Reserve Bank nod to ahead with its restructuring plans.