Allbank eyes south, plans 280 branches

Allahabad Bank is planning to expand in a big way in south India.

A C Mahajan, the newly appointed chairman and managing director of the bank, said the bank was keen to increase presence from 80 branches to at least 280 branches in three years.

"Of our 2,000 branches, we have only 80 in south India. We desire to increase our presence in south by adding another 200 branches over the next three years," said Mahajan.

This year, the bank got RBI's approval for opening 108 branches, of which a few will be opened in southern states.

The bank is also open to the idea of inorganic growth.

"We will seek RBI's permission for opening around 100 branches over the next three years though the desired figure would be 200. The bank is open to the idea of acquiring bank with strong presence in south India," explained Mahajan.

There has not been any development in this regard, he confirmed. Meanwhile, the bank has set ambitious target of achieving Rs 2,00,000 crore turnover in the next five years.

"We desire to achieve a total business of Rs 2,00,000 crore in the next five years. We need to grow at a compounded annual growth rate of 25 per cent, which we expect to achieve," he added.

In the current year, the bank is eyeing a turnover of Rs 1,00,000 crore compared with Rs 78,561 crore last year.

Advances are expected to grow by Rs 7,000 crore in 2006-07 over last year's figure of Rs 30,061 crore, whereas deposits may increase by Rs 10,000 crore over last year's figure of Rs 48,500 crore.

Speaking about the general insurance venture with Sompo of Japan, Mahajan said, "Sompo has to submit clearance certificate from Japanese regulator Financial Services Agency (FSA) to be part of the general insurance. As per the information available, Sompo is likely to get back on August 25 on this issue."

Meanwhile, the bank has decided to revive AllBank Finance Ltd, the non-banking finance subsidiary, in a significant manner.