Bangalore-based public sector lender Vijaya Bank is looking at a growth of 22 per cent in its total business to touch Rs 1,50,000 crore during fiscal 2011-12. The bank’s total business grew 18 per cent to reach Rs 1,22,470 crore during fiscal-ended March, 2011.
“We are aiming to increase CASA (current account savings account) share to 30 per cent in the next two years. We are also targeting a growth of 20 per cent under the retail credit and a 30 per cent increase in MSME advances this year,” H S Upendra Kamath, Chairman and Managing Director, Vijaya Bank told reporters.
He said, during the just-concluded financial year 2010-11, the bank’s deposits increased 18.27 per cent year-on-year at Rs 73,248 crore and advances went up 17.37 per cent to Rs 49,222 crore.
While the bank could maintain the average yield on advances around 10.25 per cent, the cost of deposits was reduced to 5.86 per cent from 6.21 per cent in the previous year. As a result, the net interest income has increased significantly by 34.35 per cent from Rs 1,449.07 crore to Rs 1,946.78 crore. The net interest margin also improved during the year to 3.04 per cent from 2.54 per cent a year ago, Kamath said.
With a branch network of 1,200 branches, the bank aims to add another 100 branches and 150 ATMs during the present financial year. “We want to bring all the retail credit products under the centralised processing fold by strengthening the existing Retail Asset Centralised Processing Cell (RACPC) setup and introduce centralized processing for MSME loans. This will help us reduce the turnaround time in sanctioning and also to boost credit flow to these segments,” he said.
During the next one year, the bank would further broadbase the business portfolio with focus on retail and fee-based segments. Efforts will be made to reduce high cost liabilities and low yielding assets. It is also aiming at containing gross non-performing assets at below 2 per cent and net NPAs at below 1 per cent by focusing on recovery and quality of assets in a big way, he added.
The bank is also looking at augmenting other income through initiatives for re-entry into third party business. It is considering the possibility of launching insurance business on its own after its earlier attempt of insurance business with other partners failed, he said.
