Allahabad Bank plans to revive its $500-million overseas bond sale plan to support its growing Hong Kong business.
Bank chairman JP Dua said the lender needs resources for its swelling Hong Kong business, which grew 62% last fiscal to cross the $1 billion mark. It has earned 2.5 times moreprofit of Rs 48 crore in 2011-12 from the city-state situated on China's south coast.
"We need long-term resources for the growing overseas business and to bridge asset liability mismatches," Dua told Economic Times.
It used to grow business till date by borrowing short-term resources from foreign alongwith a support fund of $30 million from its headquarters in Kolkata.
The earlier plan to sell the bonds was put on hold while its Hong Kong business soared due to a rise in trade with China.
Allahabad Bank's Hong Kong branch has its advances portfolio at Rs 4,723 crore at the end
of this fiscal, compared with Rs 2,903 crore a year back.
Its deposits grew to Rs 604 crore now from Rs 381 crore earlier. Hong Kong has a 45,000-strong ethnic population but bank officials said that Chinese have contributed significantly to the business growth, especially deposits.
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