State-run Uco Bank has secured approvals from its board of directors and shareholders to raise Rs 3,000 crore capital this fiscal as the lender requires resources to grow and also provide for non-performing assets, an official said on Tuesday.

The capital will be raised at an appropriate time either through a public offer or a qualified institutional placement (QIP) or preferential issue, Uco Bank MD and CEO A.K. Goel said.

“We need capital for both growth and provisioning. Demand for credit is slowly recovering,” he said.

The bank’s provision coverage ratio (PCR) is more than 86 per cent, he said, adding that the asset quality scenario will be known after the moratorium on loan repayment is over by the end of this month.

“By the third quarter, we will be able to see what extra provisioning is needed. When the time will be conducive, we will raise capital. We are monitoring the market condition,” he said.

Goel also said an uptick in credit demand has been witnessed. “People are going for vehicle loans to buy cars to go to offices because of the pandemic. There is a slow recovery of credit off-take,” he added.

Speaking about the possibility of coming out of the restrictive prompt corrective action framework, Goel said meetings with the regulator could not be held in the current situation.

The Calcutta-based lender posted a net profit of Rs 21.46 crore in the first quarter of the current fiscal. Both levels of the non-performing assets and the capital adequacy ratio by the end of the first quarter should enable the bank to come out of the PCA, he added.

Gross non-performing assets came down to 14.38 per cent of the total advances as on June 30, 2020, from 24.85 per cent in June 2019 and 16.77 per cent by the end of March 2020.