Jammu & Kashmir Bank is considering the possibility of offering around eight to ten per cent of its stake to strategic investors in lieu of fresh capital that would be injected by them.

The bank was also considering a proposal of returning around three per cent of the government's stake in favour of strategic investors.

The bank was not averse to the idea of offering a stake to institutions like Life Insurance Corporation of India if it showed interest in the bank. When asked whether J&K bank was likely to consider such a proposal, chairman, M Y Khan said, "We are open to such offers."

At present, the government holds 53 per cent in the bank, the rest of it is held by general public. "Things are however at a preliminary stage and we will have to receive government approval for the proposal, which will have to be passed by the board following which it will be referred to the Reserve Bank of India," Khan explained.

When asked whether J&K bank would like to see the government's stake further come down in the bank, Khan said, "With the freedom that the government has given us with respect to functioning, we would like the government to remain a majority stake holder in our bank."

Khan also said that it was looking at synergies with south-based banks that had a strong regional presence. This would supplement both the banks' network in North as well as the southern region providing it with a pan India presence.

"Synergies could involve loan syndication, housing loans and other types of tie-ups," he explained. Khan also did not rule out the possibility of raising Tier-I capital next year.

However he said the route - either a preference/rights or a public offering were issues that would be decided on a need basis. He also said that the quantum of funds to be raised would be decided on the need basis.

It has also applied for opening overseas branches in Dubai, Kualampur and London and has asked for RBI's nod.

Meanwhile, the bank is likely to clock a Rs 425 crore (Rs 4.25 billion) profit figure for 2003-04 against Rs 338 crore (Rs 3.38 billion) in the previous year, and register a 16 per cent growth.

The bank has targeted a Rs 26,000 crore (Rs 260 billion) figure against Rs 22,000 crore (Rs 220 billion) in the previous fiscal. It expects to close the year with a total advances figure of Rs 9,500 crore (Rs 95 billion) and deposits are likely to be around Rs 15,500 crore (Rs 155 billion) against Rs 14,000 crore (Rs 140 billion) in the previous year.