The public sector Union Bank of India has projected a business growth of 30 per cent in Orissa in the current fiscal. It aims to achieve Rs 5425 crore business in the state this year. The bank achieved 27.81 percent growth in business in the last fiscal.
It closed the last fiscal with a total business of Rs 4170 crore, which included Rs 2763 crore deposits and Rs 1407crore advances.
The bank will focus on enhancing lending to sectors like MSME, agriculture and retail and mobilisation of deposits to achieve the overall target in the state.
“We achieved a growth of 27.81 percent during 2008-09 and intend to achieve a growth of about 30 percent in 2009-10”, A Sudhakar, DGM, Union Bank of India told Business Standard.
Sudhakar, who is leaving as the regional head of the bank in Orissa to take up another assignment in the bank said, the deposits of the bank in the state is projected at Rs 3600 crore and advances at Rs 1825 crore during 2009-10.
The lending to the MSMEs, which is a thrust area for the bank, is also likely to increase by 35 percent to Rs 195 crore. Similarly, trade loans are targeted to increase by 50 percent to Rs 180 crore during the current fiscal from Rs 120 crore in the previous one.
He said, the bank has been attaching lot of importance to agriculture sector and advances to this sector are likely to increase to Rs 730 crore in 2009-10. This will be 42 percent higher compared to the previous fiscal. Priority sector lending is also set to increase by 25 percent to Rs 1050 crore during the current year.
Significantly, the bank has been recording more than 25 percent growth in the business mix over the last three years. It increased from Rs 2360 crore in 2005-06 to Rs 4170 crore in 2008-09 with the highest ever growth rate of 28.8 percent in 2008-09.
Sudhakar said, the bank has a credit-deposit ratio of 50.89 percent by March 2009 and has been able to contain the non-performing assets (NPA) within the ceiling prescribed by the bank.
As a matter of strategy, the bank has been pursuing the policy of reducing the proportion of high cost deposit in the overall deposit mobilisation. Accordingly, it has been able to reduce the high cost deposits from Rs 587 crore in March 2008 to Rs 517 crore by March 2009.
“We intend to boost the low cost deposits and to reduce the high cost deposits for making credit available at cheaper rate”, he added.
On branch expansion, Sudhakar said, the bank has license to open 3 more branches and these branches will be opened in locations like Sonepur, Bolangir and Kalinganagar by June this year. Union Bank will have presence in 26 districts in the state after these branches are opened and the remaining 4 districts in the state will be covered at the earliest.
The bank, one of the preferred financiers for the much awaited ‘Nano’, has identified its Patia branch in the city as the nodal branch to extend loans to as many customers as possible, he said.
