Tamilnad Mercantile Bank Ltd has filed preliminary documents i.e. DHRP with SEBI for its IPO. Over 1.58 crore new shares will be issued in the IPO, while only existing stakeholders and promoters will sell 12,505 shares under the offer for sale. Under the Offer for Sale (OFS), D. Prem Palanivel and Priya Rajan will sell 5 thousand shares. Prabhakar Mahade Bobde will sell 1000. Narasimhan Krishnamurthy will sell his 550 shares. While M Maliga Rani and Subrahmanyam Venkateswaran Iyer will sell 500-500 shares.
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Funds raised from the issue will be used to raise Tier-1 capital.
Axis Capital, Motilal Oswal and SBI Capital Markets are the lead managers of the issue. Funds raised from the issue will be used to augment its Tier-I capital to meet future capital requirements. The bank has to maintain the CRAR level of 10.875 per cent till March 2021. Its Tier-1 Capital Advocacy Ratio (CAR) was 17.93 per cent.
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Bank’s NPAs fall
During the financial year 2020-21, the bank’s NPA was 3.44 percent, while it was 3.62 percent during its last financial year i.e. 2019-20. Net NPA during the financial year 2020-21 was 1.98 percent. At the same time, it was 1.8 percent during the last financial year i.e. 2019-20. However, the CASA ratio has shown an improvement and it has reached 28.52 per cent in 2020-21 as compared to 25.85 per cent in 2019-20. The bank has 41.80 lakh customers in Tamil Nadu. This is more than 85 percent of its total customers. The bank also has presence in Gujarat, Maharashtra, Karnataka and Andhra Pradesh. The bank had 509 branches till June. Of these, 106 are in rural areas. There are 247 in semi-urban areas, 80 in urban and 76 in metropolitan areas. Its total number of customers is 49 lakhs.