Allahabad Bank plans to give a big push to its gold banking in the current year. The bank will introduce retail trading in gold, in addition to handling consignments on behalf of its customers.
Gold banking, which was started in the previous year by Allahabad Bank, has yielded a turnover of close to Rs 800 crore in 1997-98. The profit margin stood at Rs 6.5 crore. According to B Samal, executive director, the bank will soon extend the gold banking facility to Bangalore, Chennai and Calcutta. Gold banking has already started in Mumbai, Ahmedabad and Delhi.
The bank is confident of making inroads in gold banking with the introduction of retail trade in the form of selling gold coins for the people at large. The yield in such trade is higher though it is somewhat more risky than dealing in gold through consignments on behalf of customers.
After gold banking, Allahabad Bank is set to introduce credit cards or `green cards' for the farmers which, in its turn, will be followed by floating a wholly-owned subsidiary housing company.
In the core business, Allahabad Bank has set a 25 per cent target for growth in deposits for the end of the current year. Deposits stood at Rs 13,541 crore in 1997-98. Similarly, the growth target for advances is 20 per cent. Gross advances have been projected at Rs 7,400 crore against Rs 6,295 crore in 1997-98.
Samal claimed that deposit growth recorded for the bank upto 17 July was 2.7 per cent against the industry performance of negative 0.4 per cent.
Targets for priority sector advances, at 40 per cent (against 37 per cent in 1997-98), and for export, at 12 per cent (10 per cent), are also achievable, Samal said.
Non-performing assets (NPAs) still bother the bank management. To bring the situation under control, a high-powered committee under the aegis of a general manager has been set up.
