Head says Andhra Bank to revalue immovable assets to boost
MUMBAI - Andhra Bank is planning to revalue its immovable assets
worth
490.3 mln rupees. After revaluation, the immovable assets will be
worth 4.5
bln rupees, said Chairman and Managing Director R.S. Reddy, today.
"We will be able to add 180.50 crores (1.8 bln rupees) to our Tier
II
capital following the revaluation," Reddy told NewsWire18.
According to norms, banks can add up to 45% of revalued assets
into
Tier II capital base, bank official said.
Andhra Bank had not revalued its immovable assets for a long time,
and
therefore extent of appreciation is substantial, said officials close
to the
development.
This revaluation exercise has released some capital for the state-
owned
bank. Andhra Bank is constrained from raising equity capital as
government
holding in the bank is at 51.55%.
Government holding in state-owned banks cannot fall below 51%.
"After revaluation, the headroom available to raise additional
Tier II
capital would be 1,209.50 crores (12.09 bln rupees)," Reddy said.
More
.
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