The Reserve Bank of India (RBI) has asked Punjab National Bank (PNB) to find a new partner in place of DCM Shriram Consolidated Ltd for its proposed foray into the life and non-life insurance businesses. The central bank has raised a technical objection that DCM Shriram is a client of the bank.
"We already have the RBI permission to pick up a 26 per cent stake each in the two insurance businesses (life and non-life)," S S Kohli, chairman and managing director, PNB, said. The other stake holders in the proposed insurance businesses are Zurich (26 per cent) and Vijaya Bank (15 per cent).
The balance 33 per cent will be held by a corporate entity. Currently, the bank is in talks with a couple of corporates and expects to rope one of them in a month.
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Kohli pointed out that the bank has set its sights on growing its business by 19 per cent to Rs 1,17,000 crore in 2002-03. It had logged a 14 per cent growth in business in the last financial year to Rs 98,492 crore.
In the current fiscal, PNB plans to focus on improving its fee-based income, which accounted for only 12 per cent of its total income in 2001-02, to around 15 per cent of the total income.
Kohli said the bank also needs to step up its treasury activities as the profit from this segment was only at Rs 438 crore out of a gross profit of Rs 1473.80 crore in 2001-02.
Regarding overseas presence, the bank said it plans to open representative offices in Kabul, China, the UK, and Dubai. It already has one such office in Kazakhstan.
The bank plans to launch a debit card this fiscal. It also plans to bring down the net non-performing assets to below 5 per cent compared with 5.32 per cent as on March 31, 2002.