Like last week, this time too UTI Bank Chairman and Managing Director P J Nayak stayed away from the bank's board meeting on Wednesday. Immediately after the meeting, a visibly relaxed Nayak answered media queries. Excerpts:

Will you now go ahead with the ADS issue?

The board is yet to decide the means through which the bank will raise capital. It could raise capital through an overseas listing, a preferential issue, etc.

It is evaluating all options. I will meet the new UTI-I administrator shortly to discuss the issue of raising capital. Personally, I am in favour of raising capital through a large one-time issue.

To what extent will this dilute the existing shareholders' stakes?

Whenever the bank raises capital, we will aim at 20 per cent dilution in shareholding. The bank will issue over 230 million shares.

How urgent is the need to raise capital?

The bank is growing by over 35 per cent year-on-year and we would need capital to support this growth. The bank will have to raise capital in the final quarter (January-March 2005) of the current fiscal or else we will have to downsize our assets.

Tell us about your growth plans.

We have an ambitious expansion plans overseas -- in Asia and West Asia. The bank has received in-principle approval from an inter-ministerial committee and the Reserve Bank of India to set up five branches in Sri Lanka.

It is also planning to set up an offshore banking branch in Singapore and a branch in Hong Kong. We are awaiting approval from the local authorities in Dubai to set up a representative office.

We are also looking at China as a potential business destination on account of the growing trade flows between China and India. The bank has sent a team to China to evaluate the business proposal. We plan to open a representative office in Shanghai subject to regulatory approvals from the RBI and the local authorities.

Will you go for some local acquisition?

We are growing at around 35-40 per cent year on year. I see no need to change the existing business strategy. The bank will continue to grow organically.

Where do you see UTI Bank five years down the line?

UTI Bank today is an all-India bank. We have 241 branches, 28 extension counters and 148 ATMs spread across 156 cities and towns. We plan to expand our branches to various district headquarters.

In the next three to five years, UTI Bank plans to have a presence in most of the rural areas, which will enable the bank to boost its agriculture and rural lending.

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