UTI Bank board moots name change

UTI Bank will now be known as Axis Bank, following a board recommendation at a meeting in Mumbai today. The change would be subject to approvals from the government and the Reserve Bank of India.

The bank in a statement to the Bombay Stock Exchange stated: "The recommendation has risen from the existence of several shareholder-unrelated entities using the UTI brand, and the consequent brand confusion. The name will take effect consequent to approvals of shareholders, the Reserve Bank of India and the government (Registrar of Companies)."

The bank hopes to get the approvals by end-June 2007, and the rebranding to be completed within three months.

Asok Kumar, executive director of corporate strategy, told Business Standard: "The bank had appointed an internal committee and also sought help from its official advertising agency, O&M, for the proposed name change. The agency would help redesign the logo. Axis Bank is a simple name, easy to remember and has no claimants."

"The name also connotes financial stability, solidity and dynamism. We are becoming a global bank and the name has a universal appeal. According to internal estimates, the rebranding should cost the bank around Rs 50 crore," he added. Sources said the bank would to retain its burgundy colour used in the current logo.

The change in the bank's name follows a year-long tiff between UTI Mutual Fund and the bank over the use of the brand name, UTI.

As per a deal between the government and the fund's four sponsors "" State Bank of India, Life Insurance Corporation, Bank of Baroda and Punjab National Bank"" UTI's nine subsidiaries could use the brand name for free till January 2008. After the period ended, UTI Bank, UTI Securities, UTI Technology Services and UTI Investor Advisory Services had pay royalty to the fund.

UTI Mutual Fund, however, suggested that the bank continue using the brandname beyond 2008 sans royalty fees, but wanted a non-compete clause to be built in, besides seeking joint brand promotion.