 "Bandhan gets 25,000 applications for 15 posts in proposed bank")
It was about 64 years ago that Kolkata saw a new bank setting-up in the city.
United Bank of India, a public sector bank, is the youngest bank in Kolkata, established in 1950, and later nationalized in 1969.
With a new bank slated to establish its base in the city after a gap of over six decades, applications are pouring in for a job in the bank.
On July 2, Bandhan, the microfinance institution, which recently got an in-principal nod from the Reserve Bank of India to start a bank, came up with an advertisement for 15 posts in the proposed bank. In nearly 17 days, the MFI has received more than 25,000 applications for the posts, according to C S Ghosh, chairman and founder, Bandhan.
In addition, several top-notch executives of the corporate world expressed interest in joining the bank, informed Ghosh.
Notably, around the year 2000, when Bandhan was a struggling MFI, there were hardly any takers of job at Bandhan and even an advertisement to recruit at the village level did not elicit any response, according to Ghosh.
Also Read
A bulk of Bandhan's staff are already placed in rural areas, mostly high-school passouts and graduates. At present, there are about 13,000 people in Bandhan's payroll in rural areas, who are likely to be absorbed as regular employees of the proposed bank. Bandhan, will simultaneously open 600 bank branches, spread over 22 states The bank is expecting to open at least 10 million accounts in one go. The bank is expected to start functioning by the next financial year.
The MFI had appointed Deloitte to prepare a roadmap for its banking foray. Deloitte was also the MFI's consultant for preparing its application for banking licence. Deloitte would work with a core internal team of 30 members at Bandhan to prepare the blueprint over the next few months.
At present Bandhan has about 2,116 bank branches in 22 states, with loan outstanding of nearly Rs 6200 crore. On an average, the MFI disburses nearly Rs 1000 crore on a monthly basis, with monthly collections of nearly Rs 700 crore. The MFI has a market share of nearly 25 per cent in the sector.
To convert into a bank, Bandhan would be required to set up a wholly owned Non-Operative Financial Holding Company (NOFHC) for banking operations, with a minimum capital of Rs 500 crore. At present, Bandhan has a capital base of nearly Rs 1100 crore.
According to RBI norms, the promoter capital holding should not be not less than 40 per cent in the NOFHC, along with a 5 year lock in period. Progressive reduction of shareholding of promoter NOFHC is envisaged to restrict it to 40 per cent for the initial 5 year period, to eventually 15 per cent within 12 years.
Present investors at Bandhan include, International Finance Corp (IFC), the World Bank's private investment arm, Sidbi, Financial Inclusion Trust and North East Financial Inclusion Trust. Ghosh owns about 1.8 per cent stake in Bandhan. Once converted into a bank, Bandhan would have to seek listing in stock markets over the next three years.