Oriental Bank Sniffs For A Global Ally

The public sector Oriental Bank of Commerce is scouting for a strategic tie-up with a foreign partner.

In tune with the move, the bank will benchmark its balance sheet for fiscal 2000-01 with the US generally accepted accounting practices (Gaap), said the chairman and managing director of the bank, B D Narang.

He said the new accounting structure will be ready by the end of this month. The exercise is to make the market valuation of the bank true to its intrinsic value, he added.

"The Union government has allowed us to go for disinvestment. We have two options to do that. Either the government has to dilute its stake or we have to go to public. We don't have much foreign institutional investor (FII) holding. Once our balance sheet is as per the US Gaap, FIIs will come to know that we are one of the strongest banks in India," Narang said.

 

He said that 80 per cent of the bank's business would be online by the end of March 2002. The networking plan to connect various departments of head offices, 25 regional offices and computerised branches with an investment of more than Rs 50 crore has already been given green signal, he said.

Oriental Bank has identified retail credit as the thrust area to reach its target of achieving Rs 15,000 crore advances by the end of the current fiscal, a 30 per cent jump compared to last year's figure.

"The bank has liberalised various loan schemes such as housing loan, personal loan and educational loan with relatively lower rate of interest and with more emphasis on speedy disbursal," Narang said.

He said that the housing loan rates of Oriental Bank are lowest in the banking industry. "Our effective rate and indicative rates are same unlike others. We charge interest on diminishing balances, not on equated monthly installments," he said.

The bank is tying up with one or two companies to market life insurance products. This would be formally announced once approved by the board at its next meeting, Narang said.

Oriental Bank is also planning to launch debit and credit cards on its own in another three months.