Bank of baroda

OBJECTS OF THE ISSUE
The objects of the Issue are as follows:
The RBI, which regulates us, requires us to maintain a minimum capital to risk weighted assets ratio of 9.0%, at least half
of which should consist of Tier I capital. As of September 30, 2005, our total capital adequacy ratio was 12.79% and our
Tier I capital adequacy ratio was 7.86%. As per our audited restated financial statements, our total capital adequacy ratio
was 12.61% and our Tier I capital adequacy ratio was 8.21% as of March 31, 2005 compared with 13.91% and 8.47%
as of March 31, 2004, respectively.
RBI has adopted a phased approach to the implementation of the Basel II norms. New capital norms for market risk will
be implemented over two years from the year ended March 31, 2005 and norms for credit risk and operational risk are
proposed to be implemented with effect from the year ended March 31, 2007. In order to maintain consistency and
harmony with international standards, banks have been advised to adopt the Standardised Approach for credit risk and
the Basic Indicator Approach for operational risk with effect from March 31, 2007. The requirements for Tier I capital and
total capital adequacy ratios are expected to increase with the proposed implementation of the Basel II standards.
The objects of the Issue are to augment our capital base to meet the future capital requirements arising out of the
implementation of the Basel II standards and the growth in our assets, primarily our loan and investment portfolio due to
the growth of the Indian economy and for other general corporate purposes including meeting the expenses of the Issue.
As we are engaged in the business of banking, we are seeking to strengthen our capital base to support the future
growth in our assets and comply with the capital adequacy requirements applicable to us. Other general corporate
purposes would include development of infrastructure to support our business growth and service our customers.
The net proceeds of the Issue after deducting underwriting and management fees, underwriting commissions and all
other Issue related expenses are estimated at Rs. [•] million.
Our Constitutional Documents enable us to undertake our existing activities and the activities for which the funds are
being raised by us in the Issue.
Issue Expenses
The expenses of this Issue include, among others, underwriting and management fees, printing and distribution expenses,
legal fees, statutory advertisement expenses and listing fees. The estimated Issue expenses are as follows: