Public sector lender, Allahabad Bank is aiming at expanding its merchant banking wing called AllBank Finance Ltd. It currently operates only in the eastern region and wishes to expand by moving out of the east.

"The merchant banking arm has just completed one mandate, and we have a few more in hand. We have reconstituted the subsidiary's board and are now focusing on volumes. The merchant banking outfit would be expanded to 5-6 cities starting with Delhi " said J P Dua, chairman and managing director, Allahabad Bank.

"We want to open more branches in places where we have a smaller presence such as the south, and parts of north India. These regions offer tremendous potential, we want to tap it.

We have the Reserve Bank of India's authorisation for opening 68 branches during this fiscal," Dua said. The bank also plans to set up 100 ATMs this year," he added.

AllBank Finance currently has a net worth around Rs 44 crore.

The bank expects to have capital infusion worth Rs. 1000 crore in the upcoming six months.

The bank had a capital adequacy ratio (CAR) of 13.62% as on March 31, 2010.

"Our CAR is above 12 per cent and the Tier I capital is also more than eight per cent at about 8.02 per cent. We have, however, sought Rs 1,000 crore from the government during this financial year to fund our growth targets.

We understand that our application has been processed by the government. We expect to get it in the next six months" Dua said.