Canara Bank, which was appointed as one of the collecting banks for the State Bank of India Resurgent India Bonds (RIBs), has fallen pathetically short of its target. The bank which had set a target of $50 million has been able to collect just about $10-12 million.
"We could not handle the severe competition from multinational banks who had more branches across the world and supplementing this were their enticing offers and incentives to the investors," a senior official of Canara Bank told Business Standard.
It may be recalled that SBI had garnered a total of around $4.25 billion though this RIB route in which Citibank emerged as the top collecting bank.
Citibank has managed to rake in a total of $822 million through 15,000 applications and this amount is over 200 per cent their target. Out of the total $4.25 billion garnered through RIBs, 70 per cent of the collections came from West Asia, Far East and South East, while the remaining 30 per cent has come from Europe and the United States.
"Our major collections was through our London branch and its obvious we could not match the competition," the Canara Bank official noted.
RIBs has garnered $103 million in Deutschemark, $106 million came in pound sterling and the remainder in the form of US dollars.
According to analysts tracking Canara Bank, this poor showing is just an aberration as its international operations have started to take wings.
Canara Bank's foreign business turnover registered a 23 per cent growth to reach a level of Rs 34,238 crore for the fiscal 1997-98 and its London branch has posted "a robust growth in operating profits.
This is in addition to its global deposits of Canara bank registering a 21 per cent growth to reach Rs 38,045 crore, signifying a quantum increase of Rs 6,600 crore during the year.
