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Merchant Banking

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Merchant Banking

Merchant banking primarily involves financial advice and services for large corporations and wealthy individuals.

Merchant Banking Activities:

The Major Merchant Banking activities which the Bank offers to its clients are:

  • Issue Management - Management of Public Issues i.e. IPOs, FPOs, Right Issues, etc. as Book Running Lead Manager
  • Bankers to the Issue
  • Payment of Dividend Warrants / Interest Warrants / Refund Orders
  • Debenture Trustee
  • Underwriting
  • Monitoring Agency

Merchant Bankers Assignments:

At present, the Bank is holding following Licenses from SEBI:

  • Merchant Banker
  • Banker to the Issue
  • Underwriting
  • Debenture Trustee
    • In terms of SEBI guidelines, all debenture issues (public/rights) of the companies with the maturity period exceeding 18 months are required to have "Debenture Trustee" and its name must be stated in the prospectus of the issue.
    • We are registered with SEBI for handling of the debenture trustee assignments – registration No.IND000000023.
    • Dissemination of information on Debentures in default

Bankers to the Issue (Collecting Banker):

Being a licensed Banker to Issue registered with SEBI, enables us to provide Escrow Collecting Bank/services and refund Bank services related to Initial Public Offering (IPO), Follow on Public Offering (FPO) and Right Issue.

The process of collections needs a high degree of close co-ordination between various capital market intermediaries such as the Book Running Lead Manager, the Syndicate Members, the Registrar and most importantly the issuer Company. Our large network of branches and strong bonds with various capital market constituents enable us to offer better solutions for clients.

Payment Of Dividend Warrants / Interest Warrants (Paying Banker):

The Merchant Banking Division has also got enabled a functionality of a new system in CBS branches for payment assignments, which is similar to Demand Draft Payable Account under Finacle. The product has the following unique features that ensure that the payment account of the corporate remains reconciled at any point of time:

  • Facility for upfront uploads of the instruments issued by the companies into Core Banking system
  • Online payment of the instruments by CBS branches
  • Validation of instruments details by the system
  • Online status update of paid instruments by the system
  • Online MIS on paid/unpaid instruments at any point of time
  • Facility to cancel lost instruments and to re-upload duplicate instruments issued in lieu thereof
  • MIS on cancelled instruments
  • 100% reconciliation of the corporate dividend / refund order payable by a/c by the system without manual intervention

Facility to provide MIS on paid / outstanding instruments in ASCII format, which can be suitably converted by the corporate for updating their in-house database

This new facility will help in solving the major problem in handling these assignments i.e. reconciliation of accounts. This will also help in reducing the cost of reconciliation, postage and handling cost.

Payment of Refund Orders:

The detailed guidelines / procedures to be followed. Powers of the Branches / Charges etc. for handling the assignments of Bankers to the Issue/ Payment of Dividend warrants / Refund Orders etc. are available in the circulars of the Division at the Bank`s website.

Underwriting:

Underwriting is a contingent liability and this is one sphere of Merchant banking where outlay of funds on the part of the bank may be involved. As such, it is necessary to be very careful in accepting / recommending such business. Proposals that pose clear risk of devolvement should be declined at the outset unless there is sub underwriting tie up directly or indirectly with promoters and their related investment companies or a firm commitment of buy back on reasonable terms.

Major aspects which need close scrutiny before underwriting can be considered are the project and its viability, project location, promoters and their track record, product and its marketability, past performance of existing companies in the same line, Government Policy, projected financial performance, capital market conditions, underwriting / sub underwriting / buy back arrangements, etc.

Debenture Trustee:

In terms of SEBI guidelines, all debenture issues (public/rights) of the companies with the maturity period exceeding 18 months are required to have "Debenture Trustee" and its name must be stated in the prospectus of the issue.

We are registered with SEBI for handling of the debenture trustee assignments – registration No.IND000000023.

Dissemination of information on Debentures in default

S.No Name of the Issuer Company Default, if any, to pay interest or redemption amount Failure to create a charge on the assets Revision of rating assigned to the debenture
1 M/s. Paam Pharmaceuticals (Delhi) Ltd. Yes, there are defaults both in interest and redemption – BIFR case 310/1998. No failure Not Applicable
2 M/s. Partap Steel Rolling Mills Ltd. Yes, there are defaults both in interest and redemption - BIFR case 90/1995. No failure Not Applicable
3 M/s. Rajender Pipes Ltd. Yes, there are defaults both in interest and redemption. Bank also filed its claim with official liquidator Allahabad Petition No.486/2001. No failure Not Applicable
4 M/s. BST Mfg. Co. Ltd. Yes, there are defaults both in interest and redemption - BIFR case 57/1990. No failure Not Applicable

Compliance

Report of Debenture Trustee for half year ended 31.03.2013

Click for the Section I, Section II, Section III and Section IV

Monitoring Agency:

The guidelines to be observed before accepting assignment of Monitoring Agency are given in respective circular available in e-circular site of the Bank.

Investor Grievance

All investor grievances may be addressed to Merchant Banking Division at exclusive e-mail ID as under:-

Contact Information :

For any other information please contact any of the following persons in the dedicated team of our Merchant Banking Divisions/Capital Market Services Branches :

Address Contact Persons Tele.No./Mobile/Fax Email Address
Marketing Division, Corporate Office Plot No 4, Sector -10 Dwarka New Delhi -110075 Shri M.S.Tomar, Chief Manager, Shri R. Ramesh, Manager 011-28044461,9958823207

mbd@pnb.co.in

Punjab National Bank, Branch Office, 5, Sansad Marg, New Delhi – 110 001 ShriS. K Sgarma , Manager 011-23737533

bo4552@pnb.co.in

Punjab National Bank, Branch Office, PNB Pragati Tower, Plot No.C-9, G-Block, Bandra – Kurla Complex, Bandra (East), Mumbai- 400 051 Shri T. K Ghai, Sr. Manager 022-26530196 , 022-26530197 Mobile No. 09819913555 Mobile No. 09869966262

bo4776@pnb.co.in

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