Kotak Bank sees rise in corporate lending exposure

Kotak Bank expects its corporate lending exposure to grow by being a transactional partner to its existing investment banking clients. The bank also expects its asset base to grow by 30 per cent in the current financial year.

Addressing the media on the occasion on the opening of its first branch in southern India at Chennai, Uday S Kotak, vice chairman and managing director, Kotak Bank, said, "We would like to be the transactional banking partner for corporates and will leverage our existing investment banking relationships."

"We would not like to advance loans of Rs 500 crore to a single corporate entity and instead would like to restrict ourselves to being their transactional partner. The retail portfolio has been the major chunk of the total advances and at present it accounts for about 75 per cent of our total advances. Going ahead we would like the retail and corporate advance mix to be in the ratio of 2:1," he added.

"We expect the bank's asset base to grow over 30 per cent during the current fiscal and the total assets of the bank is around Rs 3,000 crore," he said.

Kotak Bank's deposit base was about Rs 1,200 crore for the half year ending 30 September 2003, while its capital adequacy ratio was hovering around 20 per cent and net NPAs was 0.2 per cent of total advances.

The new branch in Chennai would focus on advancing loans to the auto component segment and small and medium enterprises.

"We would be opening a new branch in Hyderabad by end of this month and would open in Bangalore next month".

"We expect to have open about 75 branches in next three years, and by the end of our first year of operations we would have 18 branches," he said. These branches would be exclusive of the 30 odd branches that the company had when it was an NBFC.

Kotak also said that the bank would soon be offering general insurance products and was in talks with general insurance companies.