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RBI nod delay hits Vijaya expansion

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sees itself falling short of its target with regard to branch expansion. The bank had earlier targeted taking its total number of branches to 1,000 from 925 at present. Meanwhile, it may also declare interim dividend after half-yearly results this year.
 
Prakash P Mallya, chairman and managing director, told mediapersons, "We already have placed applications for 143 branches with the (RBI). We had targeted crossing the 1,000-mark by the end of March 2007. But the approvals are pending with the RBI and as I see it, crossing the 1,000-mark may not be possible this year. However, we may cross the 950-mark by then." Mallya said the bank had also applied for branch licences in Hong Kong, China and Dubai.
 
About 430 branches of Vijaya Bank operate in rural and semi-urban areas.
 
"We have about 22 branches in the north-east and are looking at expanding in that region as well. Our credit-deposit ratio is, however, low in the region, at about 32 per cent compared with our national average of 62 per cent. We are looking at improving the ratio there," Mallya said.
 
"For the half year ending September 2006, our net interest margin is expected to be 3.4 per cent, with gross non-preforming assets at about Rs 500 crore. We may declare interim dividend after the half-yearly results subject to board approval," he added. The bank is eyeing business of Rs 51,000 crore by September-end 2006.
 
Vijaya Bank is also planning to raise upper Tier-II capital worth Rs 700 crore by December this year.
 
The bank had earlier raised lower Tier-I capital of Rs 250 crore with headroom to raise further Rs 200 crore. Meanwhile, the bank is planning a lending scheme for defence personnel and teachers, apart from a savings bank scheme for the middle class.
 
About a banking alliance similar to the recent one involving Corporation Bank, and Oriental Bank of Commerce, Mallya said talks have been on but nothing has been finalised as yet.

 
 

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