Corporation Bank's new CMD sets clear agenda

Raise share of low cost deposits, control slippages, improve asset quality

S R Bansal, Corporation Bank’s new chairman and managing director, has set an agenda of raising the share of low-cost deposits, arresting slippages and improving asset quality.

The current business environment was highly dynamic and changes were occurring at a rapid pace, Bansal said, adding new bank licences were being considered, which would increase competition further. Regulatory pressures were increasing and credit offtake continued to be challenging, he said in a communication to employees.

Amid this environment, the bank had to focus on mobilising current account and savings account (Casa) deposits, essentially low-cost funds, to increase its share in total deposits, he said. The Mangalore-based public sector bank has seen sharp drop in the share of Casa deposits in its total deposit base—it declined from 31.44 per cent in March 2009 to 21.68 per cent in March this year. At the end of June this year, it stood at 19.1 per cent.

For Corporation Bank, improving asset quality, especially at a time when public sector banks have seen sharp deterioration in asset quality, is important.

Another focus area for the bank, Bansal said, was quality credit growth, with a focus on agriculture, retail and small and medium enterprises. The bank would also focus on distribution channels, including expanding branch network, as well as alternative delivery channels such as automated teller machines.

The bank plans to focus on the youth, whom Bansal terms “next-gen customers”.

“I believe in results and to achieve results, people are the most important…We need to work together as one team to achieve all your aspirations. I assure you, you will always find me on your side,” Bansal said.