Andhra Bank to raise $125 mln overseas debt

KOLKATA (Reuters) - State-run Andhra Bank plans to raise up to $125 million through foreign currency loans in a couple of weeks, its top official said on Wednesday.

The bank is looking at a 20-22 percent growth in loans and deposits in 2008/09, Chairman and Managing Director K. Ramakrishnan told reporters on the sidelines of an industry conference.

"We need to go to the market to meet obligations of high-cost deposits raised last year," he said.

The bank has available limit to raise up to $300 million through foreign currency loans, he said.

"At the moment we will broadly raise up to $125 million."

The bank also plans to raise deposit rates by 50 basis points in line with inflationary pressures in the Indian economy.

India's most widely watched inflation measure, the wholesale price index, is already at a seven-year high of 8.75 percent.

"Like other banks we need to take a call on deposit rates considering inflationary pressures."

The bank expects loan growth to come from disbursements in agriculture, retail and infrastructure sectors, he said.