United Western to get SICOM's support; Stanchart, Citigroup join acquisition race

Citigroup Inc and Standard Chartered Plc have joined seven Indian banks in expressing interest to acquire India's United Western Bank Ltd (UWB), while the Maharashtra government has decided that the State Industrial Investment Corporation of Maharashtra (Sicom), one of the principal shareholders of UWB, will play a pivotal role in the reconstruction of the bank. 

The Reserve Bank of India had placed UWB under moratorium till 1 December 2006, suspending its operations for failing to meet the mandatory capital adequacy ratios of 9 per cent.

The second largest Indian bank, ICICI Bank held a board meeting that cleared the decision to submit an expression of interest to RBI to acquire UWB, while public sector Canara Bank is believed to have already submitted its EoI to RBI. Other banks in the acquisition sweepstakes include public sector Andhra Bank and Allahabad Bank, and old private sector Federal Bank.

Jayant Patil, finance minister, Maharashtra, who attended the bank's emergency meeting in Mumbai yesterday, has assured the state government's support in helping UWB to maintain its independent identity. Standard & Poor's Ratings Services had said that its foreign currency ratings and outlook on ICICI Bank have remained unchanged and are not affected by the bank's announcement of its intention to submit a bid for UWB.