Icici Bank To Keep Churning Portfolio

ICICI Bank plans to keep its balance sheet size lean this year too by churning its assets portfolio.

"This year we are continuing our strategy to buy and sell assets. The best way to maintain the balance sheet is to keep it mean and lean. We are selling buying and syndicating with other players in the market," said ICICI bank's executive director Nachiket Mor.

He added that the bank is not looking at growing its corporate balance sheet. "We are not looking to grow the balance sheet size through corporate assets. We expect to see the retail assets grow. There is not too much expansion seen coming from large companies. The expansions could be seen in the small and medium enterprises (SME) sector," said Mor.

 

Added the bank's chief general manager PH Ravi Kumar, "Post merger (of ICICI with ICICI Bank), the focus is to ensure that retail credit is larger. The key focus is that incremental quality of corporate assets should be good. The SME sector is one of the sectors where there is no focus from any of the Indian banks."

ICICI Bank today launched a 'roaming current account' (RCA) for emerging corporates -- the SME sector. The account will also provide a range of value added services for fast collection and transaction of funds from multiple locations.

Depending on the needs the customer can choose to keep a higher quarterly balance and get the services free. The RCA offers a choice of 5 current account variants with quarterly average balances ranging from Rs 10,000 to Rs 5,00,000.

The SMEs will get more free services as the balances kept in the account increases or the customer will have to pay as they use the account.

The bank has a current portfolio of 12,000 accounts with a portfolio size of Rs 700 crore. It plans to increase the number of accounts to 50,000 and increase the portfolio size by additional Rs 750 to Rs 1000 crore.

According to Mor the challenge is to identify high quality customers. The bank can build SME portfolios and diversify depending on various groups or industries so that it is not affected by problems in any industry. ICICI bank will be launching lending products in this sector in the next few weeks.

On agriculture lending, Ravikumar said that the direct lending of the bank in this sector has increased and would touch the RBI stipulated 13.5 per cent as against 9 per cent last year.