DCB Bank to double business in three years

Bank to continue focus on lending to retail and SME; with a CAR of 14.11%, it does not need fresh capital till Sept 2017

DCB Bank, a new-generation private sector commercial bank, intends to double its total business in three years, up from Rs 19,000 crore the bank clocked by the end of March this year.

"The growth in total business would come on the back of expansion in branch network and launch of new products. Out of Rs 19,000 crore total business that we recorded, loans comprised Rs 13,000 crore", said Murali M Natrajan, managing director and chief executive officer, DCB Bank.

The bank, listed on both NSE and BSE, would continue its focus on lending to retail and SME (small & medium enterprises) segments. Mortgage has the biggest share of the bank's loan portfolio (43 per cent) followed by agri inclusive banking (17 per cent), corporate loans (15 per cent) and SMEs (12 per cent). It has an exposure of five per cent to the microfinance sector and lends to microfinance institutions at interest rate in the range of 24 to 26 per cent.

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DCB Bank's advances to priority sector crossed 50 per cent last fiscal, well above the mandate of at least 40 per cent set by the Reserve Bank of India (RBI). "In this fiscal, our priority sector advances would be in the range of 50-55 per cent", Natrajan said.

The bank has also managed to address its bad loans, bringing down its gross NPA (non-performing assets) to 1.51 per cent and net NPA at 0.75 per cent (as on March 31, 2016). With a capital adequacy ratio of 14.11 per cent, DCB Bank is well capitalised and does not need to raise fresh capital till September 2017, he said.

The bank's growth strategies include concentration on Tier-II to VI locations, relentlessly focus on liquidity, costs, operational risks & customer service, form strategic alliances with entities to enhance distribution, continuously strengthen credit processes, create a diversified and largely secure advances portfolio, invest heavily on customer facing and frontline enabling technologies and partner with select start-up companies on disruptive technologies.