Indian Bank has continued its steady development in each organization and earnings in spite of the pandemic predicament. The capital adequacy ratio at 15.71% is providing great strength to the balance sheet and this will aid the bank to lend aggressively when the pandemic-induced lockdown ends and economy opens up.
Padmaja Chunduru, MD & CEO, says that this year her focus will be on leveraging the bigger balance sheet size, greater CRAR, wider geographical presence, bigger talent pool and enhanced technologies. Excerpts from a post-outcome virtual press:
Having completed the amalgamation approach with Allahabad Bank, going forward, what would be the tactic for India Bank?
We will be leveraging the big balance sheet strength accomplished by the amalgamation. While the focus will be on capital conservation, there will be possible for enhance in corporate exposure. We can take big exposure in corporate sector, we have now a lot more experience in due-diligence. We are poised to increase our corporate organization as there will be pent-up demand from corporates for loans as soon as the economy opens up. We will be diversifying our asset base. Revenue maximisation and expense optimisation will be one more essential locations which will be taken up by the bank.
How has been the FY 21 for the bank?
The bank has continued its steady development in each organization and earnings in spite of the pandemic predicament. The capital adequacy ratio was at 15.71% providing great strength to the balance sheet. FY21 has been a specific year wherein the bank has effectively completed the amalgamation with Allahabad Bank, like CBS integration of each the banks, with seamless continuity in consumer operations. The bank as on date has rationalised 217 branches, 25 zonal offices, 12 currency chests, 3 big corporate branches, 5 service branches, six employees instruction centres and six stressed asset management branches.
What is your recovery target this fiscal? Do you foresee any elevated provisioning for the anticipated slippages due to Covid second wave ?
We count on a recovery of Rs 5,000 crore from each NCLT and non-NCLT this year, but that will also be revised right after reviewing the evolving predicament. Too early to predict on the probably provision requirement for the coming quarters, what ever will be the predicament, we will be capable to handle the slippages on the strength of the balance sheet. It is incredibly complicated to project what would be the predicament as far as slippages are concerned, provided that the RBI has provided the dispensation for restructuring. SMEs are the most vulnerable segment and we are providing them restructuring window and a lot of outreach is taking place. We count on to hold the slippage ratio beneath 2%.
Any plans on digital front?
Improving digital penetration, with focus on new age digital merchandise and finish- to -finish answer for digital lending will also be our focus locations. The investments made by the bank in IT, digital infrastructure safety controls for the duration of the year are paying dividends. We have implemented sturdy information analytics models to increase digital organization. We are creating migration to digital channels in a large way. There has been a 13% shift to digital transactions in FY21. We are bringing in more merchandise on app and net banking.
Any plans to raise capital in FY 22? The development target for FY22?
We are adequately capitalised, we had raised a total of Rs 4,000 crore for the duration of the second and third quarters of the last monetary year. We have a board approval to raise about Rs 4,000 crore this monetary year. We are not in a hurry, but surely will look at raising the equity funds. If the marketplace is conducive, we will raise the funds this year itself. As far as development target is concerned, we could not obtain the target last year as advances did not choose up due to lack of corporate appetite. In the existing year, the predicament seems to be nevertheless uncertain and providing a target would be adventurous. But nevertheless, we would count on to have a 10% development, but of course, we will evaluation it as and when we get some more clarity.