Janata plans to raise Tk 100cr in IPO
State-owned Janata Bank plans to raise Tk 100 crore from capital market through initial public offering (IPO) next year in a bid to strengthen its capital base.
A senior official of the bank on condition of anonymity said they expect to go for the IPO by June next year after finalising the bank's financial statement by March.
Janata Bank will be the second state-owned bank to be listed with the stock market, with Rupali Bank being the first one.
The Board of Directors of the bank, which has Tk 259.39 crore paid-up capital now, took the decision at a recent meeting.
The money to be raised from the capital market is meant to ensure capital adequacy of the bank.
Rupali Bank was listed with the stock market in 1986 as part of its privatisation process prescribed by the World Bank.
Presently, shares of Rupali Bank and 46 private commercial banks are being traded on both the Dhaka and Chittagong stock exchanges.
“We will sign an agreement with ICB Capital Management very soon to appoint it as issue manager for Janata Bank IPO process,” the official said.
Janata Bank with Tk 800 crore authorised capital will seek a good amount of premium in addition to the share's face value of Tk 100 each considering the asset value, earnings and brand value.
The bank, which was transformed into a public limited company on November 15 last year in efforts to bring efficiency, transparency and accountability, has a total asset worth Tk 24,406 crore as of December 31, 2007.
An independent management and Board of Directors in accordance with the Banking Companies Act of 1994 are now operating it.
Two other state-owned commercial banks -- Sonali Bank and Agrani Bank -- were also turned into public limited companies at the same time with the same view.
At the end of June, total deposits of Janata Bank were Tk 20,278.85 crore and total advances were Tk 13,277.82 crore. Classified loans and advances stood at Tk 2,027.22 crore.
The return on investment and return on assets were 6.52 percent and 2.38 percent respectively.
Janata, which was nationalised as per Bangladesh Bank (Nationalisation) Order 1972 immediately after the country's independence, has 848 branches including four overseas branches at the UAE. It is linked with 1,198 foreign correspondents all over the world.
A total of 13,000 people are working with the bank.
The mission of the bank is to actively participate in the socio-economic development of the nation by operating a commercially sound banking organisation, providing credit to viable borrowers, efficiently delivered and competitively priced, simultaneously protecting depositors' funds and providing a satisfactory return on equity to the owners.