The Initial Public Offer (IPO) of Tamilnad Mercantile Bank (TMB)will open on Monday, 5 September, with 15,840,000 equity shares of face value of ₹ 10 being offered in the price band of ₹ 500 to ₹ 525 per share.
Headquartered in Tuticorin, TMB’s operations are mostly focused on Tamilnadu, with 369 of its 509 branches located within the State. However the 100-year-old bank does have 21 branches in Gujarat, the oldest of which is located in Ahmedabad. It also has branches in Surat, Siddhpur, Bhuj and Mundra.
Addressing a press conference in Ahmedabad on Thursday, TMB managing director and CEO KV Rama Moorthy said a large chunk of TMB’s lending business comes from medium and small scale enterprises (37% of total advances) and agriculture (29%). Retail lending constitutes 20% of advances and corporate loans account for 12%. Mr Moorthy, who was earlier with Bank of Baroda, recalled his postings in Gujarat in the early years. “Gujarat has always been at the forefront of economic growth,” he said.
Addressing the press conference, TMB General Manager P Suria Raj said the bank’s Gujarat operations has one of the lowest NPAs (non-performing assets). TMB Deputy General Manager PR Ashok Kumar said the bank has reduced NPAs from 3.62% in FY20 to 1.69% in FY22, which compares well with its peers.
TMB proposes to utilize the proceeds of the IPO to finance future capital requirements that are expected to arise out of growth in assets, primarily loans/advances and investment portfolio. This will ensure compliance with regulatory requirements on capital adequacy prescribed by the Reserve Bank of India.
