Allahabad Bank is planning to increase its footprint in South India by opening 100 of the 250 branches proposed for the current year in the south.
While the bank has a network of 2,536 branches across the country, it has just 148 branches in the four states. However, the trend has a two way direction with some public sector banks based out of the South, such as Corporation Bank, that have similar plans for North India.
All the four South Indian states offer good business opportunities and high credit deposit ratio is reflective of this potential, J P Dua, chairman and managing director, Allahabad Bank, said here at the weekend.
The average CD ratio in Andhra Pradesh, for instance, is 115 per cent compared to around 30 per cent in Bihar and the North East and about 60 per cent in West Bengal.The bank’s total business for 2011-12 stood at Rs 2,71 lakh crore while the share of business from the Southern states was only about Rs 18,778 crore and is a reason for its present branch expansion drive in the South.
Dua said, Rs 3.3 lakh crore target in total business with 20 per cent growth in present year is achievable as the bank’s business performance has always been a couple of percentage points higher than its peers in the past. The bank will focus more on SMEs, agriculture and retail loans this year, he said.
The credit demand has remained subdued in the first quarter and is expected to rise from September, 2012 onwards, according to him. The corporate sector accounts for 45 per cent of the bank’s credit portfolio while MSME and agriculture contributed around 18 per cent each. Retail segment loans account for 14 per cent of the advances, according to him.
In line with the expansion, the bank recruited 7,200 people last year and plans are afoot to recruit another 2,600 people, including chartered accountants, IT professionals and law graduates this year, said Dua.