As part of an exercise to rationalise costs, ICICI Bank, the country’s largest private sector lender, plans to set up a service centre in Hyderabad to house its call centres, back offices and training facilities, according to a senior executive.
The construction of the office is well under way. The lender has acquired land in Ahmedabad for another office.
“We want to make Hyderabad a service centre and move our back office, call centre and training facilities there. Any processing operation that need not be run out of a regional office will be moved there,” said Executive Director K Ramkumar.
At present, the lender has call centres in Andheri and Thane, Mumbai’s suburbs, as well as Hyderabad, while its back offices are spread all over the country. The lender employs 8,500 people in its back office and call centres.
“We plan to move about 3,500-4,000 people in the first phase and about 7,000-8,000 in the second phase. No employees will be moved before April 2010. We don’t want to move employees in the middle of the year as this causes great inconvenience to the staff,” said Ramkumar.
The Hyderabad facility would have room for up to 20,000 employees, he added.
The move to cut cost is a key feature of the bank’s consolidation phase, which Ramkumar says will be over by 2011. According to him, 70-80 per cent of the cost-cutting exercise is over. “There is still some more juice that can be squeezed out of three components — direct marketing, rentals and people.”
The lender currently employs 34,500 people. “When our branch strength was 1,000, we had 42,000 employees. Now, we will have the capability to run 2,000 branches with 34,000 people,” Ramkumar said. He added that this year, the bank would hire only to fill vacancies created by employees leaving the bank.
The bank has made it clear that it wants its branches to originate loans rather rely on direct marketing agents. Its expenses on direct marketing agents fell to Rs 529 crore for the year ended March 31, 2009, from Rs 1,543 crore in the previous financial year.
However, the bank will have to keep relying on direct marketing agents (DMAs) for auto loans. “Since these loans are originated by auto dealerships, we cannot cut our reliance on DMAs for this,” Ramkumar said.
