Janata Bank has decided to take Tk 900 as premium against its share's face value of Tk 100 only, says the bank's managing director and chief executive officer.
“We have set a higher premium price considering the bank's asset and brand values,” SM Aminur Rahman told The Daily Star.
He said the bank is at the final stage to issue shares of a nominal value of Tk 100 each at a subscription price of Tk 1,000. The Tk 900 difference will go to the share premium account.
The bank is likely to hit the stock market in the first quarter of 2009, the bank's top official said.
Janata Bank will be the second state-owned commercial bank to be listed with the country's stock market after Rupali Bank. Rupali was listed with the stock market in 1986 as part of its privatisation process prescribed by the World Bank.
Bangladesh's capital market is dominated by the presence of financial institutions and presently shares of some 46 private commercial banks are being traded on both Dhaka and Chittagong stock exchanges.
According to sources in the finance ministry, the other two state-owned banks Sonali and Agrani would also go for initial public offerings after Janata Bank.
The bank, which was transformed into a public limited company on November 15 last year, has a total asset of Tk 24,406 crore as of December 31, 2007.
The government corporatised Janata along with Sonali and Agrani aiming at bringing efficiency, transparency and accountability to the bank as well as listing with the stock market.
An independent management and board of directors in accordance with the Banking Companies Act of 1994 are now operating the bank.
Investment Corporation of Bangladesh (ICB), licensed as issue manager, will deal with the IPO of Janata Bank.
“An agreement between Janata Bank and ICB will be signed tomorrow,” SM Aminur Rahman said.
“We will soon give the bank's balance sheet to the ICB and the Securities and Exchange Commission (SEC) for assessment,” Rahman added.
Janata Bank has Tk 800 crore in authorised capital and Tk 259 crore in paid-up capital.
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 (ROI) and return on assets (ROA) were 6.52 and 2.38 percent respectively.
Janata Bank, which had been nationalised as per the Bangladesh Bank (Nationalisation) Order 1972 immediately after the country's independence, has 849 branches including four overseas branches at the UAE. It is linked with 1,202 foreign correspondents all over the world and 42 exchange houses.
A total 13,000 people have been employed in the bank.
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