Indian Bank has received the Central Bank of Sri Lanka's nod to open its branch at Jaffna in Sri Lanka, according to its chairman and managing director T M Bhasin.
During his recent visit to Sri Lanka, he had said that the new branch would adopt a different model for its Jaffna operations by forming and lending to self-help groups in sectors such as agriculture, fisheries and dairy.
The bank would deploy the deposits garnered from Jaffna, in Jaffna itself to improve the economic development and to help improve the lives of the people there.
Indian Bank which helped in the formation of more than 450,000 SHGs and financing them through its 29 exclusive microsate branches in India will replicate a similar model in Jaffna.
The bank is also looking at expanding its footprint on the east coast of the island nation with two branches being planned in Batticaloa and Trincomalee by the end of next year. The bank’s Colombo branch which has a balance sheet of 5 billion Sri Lankan rupees, plans to double it in two years. It would also play a major role in the rebuilding and rehabilitation process in Jaffna by financing the houses planned to be built for the displaced people.
Sri Lanka’s infrastructure development is witnessing a boom similar to India which has been growing at a pace of 40 per cent in the last three years. Indian Bank would actively lend for infrastructure development activities through the new branches.
Bhasin further said that the Colombo branch had been ploughing back profits to boost the capital to prepare for higher loan growth.
It already had 3.5 billion rupees by way of capital which was higher than the required 3 billion year-end floor set by the Central Bank of Sri Lanka. If needed, the bank may further infuse capital from India for expansion of credit in the Island nation, he said.