The Centurion Bank expects to come out of the red this fiscal and targets to double its assets to over Rs 7,500 crore (Rs 75 billion) by 2004-05, after the capital infusion of about Rs 219 crore (Rs 2.19 billion) from its strategic partners.

"All the problems will be behind us after two months. My expectation is that the bank will post a net profit this fiscal," Centurion Bank chairman, V Janakiraman, told PTI after its Connaught Place branch inauguration in New Delhi on Friday.

The bank drastically reduced its net loss to Rs 25.36 crore (Rs 0.25 billion) last fiscal, from a loss of Rs 161.84 crore (Rs 1.62 billion) in 2001-02.

After the restructuring, Janakiraman said, "The bank will be able to double its assets within 18-24 months from the present level of Rs 3,700 crore (Rs 37 billion)".

This will be the first time in the history of the Indian banking sector that a troubled private bank would be turned around without the help of the government, claimed the former SBI managing director.

The Centurion Bank got a new lease of life after the Oman-based Bank of Muscat and the UK-based Sabre Capital, agreed to take up the strategic stakes, while the Asian Development Bank and Keppel Bank of Singapore agreed to infuse additional capital in the beleagured bank.

The capital restructuring would be in two phases -- Rs 154 crore (Rs 1.54 billion) infusion from the four partners, and then a 65 crore (Rs 0.65 billion) rights cum public issue in second half of this fiscal.

The Bank of Muscat has agreed to bring in Rs 75 crore (Rs 0.75 billion), while Sabre Capital plans to infuse Rs 54 crore (Rs 0.54 billion) in the troubled bank, initially promoted by the 20th Century Finance of Dev Ahuja.

Existing shareholders ADB and Keppel would together inject another Rs 25 crore (Rs 0.25 billion) in September, Janakiraman said.

With the capital infusion, Centurion Bank's capital adequacy ratio would be over the RBI stipulated 9 per cent.

The Centurion Bank hopes that the Mumbai high court would approve its merger proposal with the Bank of Muscat's Indian operations by August 22.

Another tranche of capital infusion would come after 1-2 years, Janakiraman said.

The bank also hopes to get clearances from the Registrar of Companies and the Reserve Bank in two months.

Portraying Centurion Bank as a "resurgent and vibrant" bank in near future, Janakiraman said, "We would target the middle and upper class with the array of retail portfolio to double our business in two years."

The bank would reduce its corporate lending to 30 per cent of its advances and raise its retail portfolio to 70 per cent.

The Centurion Bank also plans to convert the 50 asset financing branches of the erstwhile 20th Century Finance into bank branches to increase its network to over 120 locations.

"The market is seeing value in the bank," Janakiraman said. The share price of the bank surged to about Rs 11, even after the face value was reduced to Re 1 from the earlier Rs 10, which is an indication of the bullish outlook of the investors.