The State Bank of India (SBI) Bengal Circle, which registered a 60 per cent growth in its car loans portfolio this year, is bullish on the segment and expects the business to grow further with the launch of the Nano, this March.
SBI Bengal Circle has disbursed Rs 68 crore worth car loans during April 2008 to Januray 2009. Its total portfolio size stands at Rs1,000 crore. SBI has been selected as the sole booking agent for the Tata Nano and a formal announcement is expected in the next 15 days, informed J K Sinha, chief general manager,SBI,Bengal Circle.
The bank was in the process of inking a deal with Tata Motors, which would give them the sole right for sale of application, and booking of Nano, he said, declining to divulge further details. The bank expects a higher growth in the segment after the launch of the Nano by Tata Motors.
As for its home loan business, SBI has received 1,500 applications so far under the ‘Happy Home Loan’ scheme, which offers home loans at eight per cent for the first year with no upper limit. For the next four years, the customer of a loan of up to Rs 5 lakh has the choice to either fix it at 9.25 per cent or pay at the existing market rates.
The total home loan portfolio of the bank stands at Rs 3,400 crore as on January 31, 2009. "We have made fresh home loan disbursals of Rs 500 crore so far this year, almost 30 per cent higher than Rs 384 crore made during the same period last year," Sinha said.
The bank has also tied up with various builders for projects such as Ambuja Realty, Calcutta Riverside and Eden City for interest rate subvention to borrowers during the ‘under construction’ period.
The builder would pay the interest on the home loan to the bank during the period of construction, so that the customer starts paying the easy monthly installments(EMI) with interest only after he gets possession of the property. Sinha felt that many of the prospective home buyers who had been indecisive for the last few months would be encouraged by both the lowering of interest rates as well as this subvention scheme.
The bank hopes to disburse Rs 400 crore new home loans by March 31, 2009, backed by the new schemes announced. "These schemes should create demand in the market, and besides expecting growth in our portfolios, we are also hoping that this would kickstart the economy," said an optimistic Sinha.
SBI Bengal Circle nearly doubled its deposits growth this fiscal which stand at Rs 10,000 crore as of January 31. The bank targets to reach Rs14,000 crore by March, as against Rs 5,650 crore in 2007-08. The total deposits of the SBI Bengal Circle stands at Rs 45,000 crore.
