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May 3, 2001
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Money > Business Headlines > Report May 3, 2001 |
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Parekh stake in GTB pared to 1.13%BS Banking Bureau Ketan Parekh's stake in Global Trust Bank has fallen to 1.13 per cent from 4.1 per cent, GTB chairman and managing director R S Hugar said on Wednesday. He said the gap between the collateral for capital market advances provided by the Parekh group and the current market price has been reduced from Rs 400 million on April 10 to around Rs 320 million now. In a major recast, GTB is planning to rope in former Bank of India chairman and National Institute of Bank Management chairman M G Bhide on the board. It has already inducted Justice K S Swamy, former chief justice of the Madras High Court and former Sidbi chief Sailendra Narain on the board. Parekh had a peak time stake of 4.1 per cent in GTB through four group companies -- Triumph International, Triumph Securities, Classic Credit and Classic Stock Broking. The bank has sold off collateral of around Rs 330 million of the KP group in the last few weeks. Around 60 per cent of the collateral provided by Parekh is in the new economy shares and GTB is expected to sell off the collateral and cut down its exposure as and when the situation improves. It has also asked the group to bring in additional collateral so as to bridge the gap. The bank's funded exposure in the capital market is around Rs 3.27 billion (7.97 per cent of advances) and non-funded exposure is around Rs 3.30 billion, the bank's executive director, Sridhar Subasri, said. He said the bank will try and reduce its exposure in the capital market to around 3 to 5 per cent of its advances to a total of around Rs 3.50 billion in funded and non-funded exposure. It had a peak time exposure of around 19 per cent of advances in the capital market. Top officials added that the bank is in talks with IFC for increasing its stake in the bank by subscribing to the bank's convertible Tier-II bonds. It can raise around Rs 1 billion in Tier-II capital. GTB is also shifting its focus to the top tier of the corporates. According to Hugar, around one third of the advances will go to the top tier corporates, another one third to the mid market companies and the remaining to other companies. The bank will give a major focus on retail and introduce new products on that front. Powered by YOU MAY ALSO WANT TO READ:
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