Indian Public Sector Banks Seek Expansion
Allahabad Bank one of India’s nationalised banks has ambitions growth plans this fiscal year and is targeting 20% growth in its total loan portfolio, and 17% growth in deposits. A company spokesperson said that loan growth would be targeted towards small and medium enterprises, steel and cement companies as well as loans being made to commercial property developers.
The bank is set to maintain 2.75% net interest margin and capital adequacy of 11% during the current financial year. The company’s Chairman KR Kamath said it did not plan to raise any new capital. The Chairman also ruled out a rights issue in order to prevent any further dilution of existing holdings.
The bank intends to remain a national lender and has no plans to increase its exposure to international markets. Kamath, who interestingly also has the same last name as ICICI Bank CEO KV Kamath also added “looking at the current volatile international market situation we will remain cautious of any international operations”.
The bank is also aggressively pursuing a 3 year target and hopes to obtain premium income of Rs 4 billion or about US$ 86 million annually, from its general insurance joint venture business. Universal Sompo General Insurance Co (USGICL) is a joint venture company between Allahabad Bank, Indian Overseas Bank, and private sector players Karnataka Bank, Dabur Investment Corp and Sompo Japan Insurance Inc.
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