Uco Board Meets Tomorrow To Discuss 3-Yr Plan

The board of directors of the Calcutta-based Uco Bank will meet on March 27 to discuss the three-year business plan of the bank.

The meeting will attempt to form a turnaround strategy aimed at improving the financial position of the bank.

The banks executive director, M M Vaish, denied reports in certain sections of the press that the board would be discussing a voluntary retirement scheme or the setting up of an asset reconstruction subsidiary. Nothing like this is on our agenda, he said.

This board meeting comes just one day before Union finance minister P Chidambaram is scheduled to meet the banks board and its trade union representatives.

Vaish, however, said he was ignorant about the agenda for the meeting with the minister.

Uco Bank suffered an operating loss of Rs 26 crore and a net loss of Rs 237 crore in the last fiscal, while it notched up an operating profit of Rs 36.63 crore and a net loss of Rs 83.81 crore in 1994-95.

Adding to the banks problems is the high ratio of non-performing assets (NPAs) to total advances, which stood at about 27 to 28 per cent as on March 31, 1996.

Besides, while there has been some reduction in the absolute amount of the non-performing assets of the bank, credit offtake has also slowed down.

The percentage of non-performing assets to total advances will not be very different at the end of this fiscal, said Vaish.

The turnaround strategy of the bank is expected to be a four-point strategy aimed at reduction of the banks non-performing assets, growth of the banks deposits and credit offtake, greater emphasis on increasing the non-fund based income of the bank and a strict check on the banks overhead expenses.

The bank hopes to enter infrastructure funds guarantee and remittances business in a big way. A large number of branches are scheduled to be opened for making drafts till late hours of the evening.

The board will also discuss issues concerning supportive polices with respect to management of NPAs and better recovery and management of investments.