 "TN politician protests IOB decision to close regional offices")
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Chennai-based Indian Overseas Bank (IOB) has decided to close down 10 regional offices in various states, realigning these under neighbouring ones. Three of these are in this state and the decision has got political attention after a protest from Vaiko, head of a prominent political party here, the Marumalarchi Dravida Munnetra Kazhagam (MDMK).
According to an IOB notice on December 31, the closure would be from March 1. The three in Tamil Nadu are at Agra, Dindigul, Nagapattinam and Tirupur. The others are at Hubli, Jalandhar, Kozhikode, Mysuru, Rajkot and Tirupathi. Bank sources say it will save around Rs 15 crore a year with the realignment. R Koteeswaran, managing director, was not available for a comment.
On Wednesday, the MDMK head questioned the decision. He said the Tirupur office did annual business of Rs 3,582 crore, Dindugal of Rs 2,173 crore and Nagapattinam of Rs 4,491 crore. While IOB was to continue regional offices with lesser business, such as at Raipur where it is Rs 799 crore, Dehradun at Rs 1,947 crore and Nagpur of Rs 1,453 crore. A large number of small units functioned at Tirupur, bringing in foreign exchange and much employment, he said.
In October 2015, the Reserve Bank of India had initiated action under the rules after slippage in part of IOB's financial ratios. Branch expansion and hiring were to be restricted till the regulator was satisfied with the improvement, though lending restrictions were not imposed. As reported earlier, IOB had a net loss of Rs 550.8 crore for the quarter ended September 2015, against a net loss of Rs 245.5 crore a year before.
The bank said: “Increased provisions for domestic and overseas advances resulted in the net loss.” Total income in the September quarter rose to Rs 6,770 crore, against Rs 6,441 crore during the same period a year before. Gross non-performing assets as on September 30 stood at 19,424 crore, compared to Rs 13,334 crore a year before. Net NPAs were Rs 12,539 crore, from Rs 9,109 crore in the same period a year before.
