Bank of Maharashtra will draw youngsters with hi-tech branches

Bank of Maharashtra (BoM) is in expansion mode, with plans to scale up branches to 1,532 and forge a pan-India presence. Also, the bank is en route to start a specialised branch for self-help groups and will come up with three 3G techno-savvy one-stop specialised branches in Pune, Mumbai and Delhi, to cater to the younger generations and high-value clients. AS Bhattacharya, who recently took charge as chairman and managing director of the bank, shared his views with DNA in an interview. Excerpts:

What will be your main aim as CMD of BoM?
After taking charge, I have started travelling a lot to meet all the employees of the bank, from top to the bottom level. I want to share with them the realities as to how their bank is doing right now. My aim is to bring in transparency and also invite suggestions from them on improving the bank’s performance. It has paid off well so far.

So how is BoM doing now and what are your plans for the future?
Our total business rose to Rs1,02,689 crore as compared to Rs91,094 crore in September 30, 2009, showing a  y-o-y growth of 12.73%. Also, total deposits stood at Rs61,661 crore from Rs54,452 crore as on September 30, 2009, a growth of 13.24% on y-o-y basis. In FY10-11 we want to achieve a total business of Rs1,20,000 crore.

Do you have any specific plans that you will be implementing this quarter to improve the bank’s performance since in Q2 there was a dip in your net profit?
There was a dip due to the increase in the non-performing assets (NPAs). We will be aiming to keep the NPA level below 3% and net NPA below 2%. In FY11, we will be setting up at least five micro asset recovery branches in identified rural centres to recover NPAs in smaller accounts and arrest further delinquencies in accounts below Rs10 lakh.

Will there be any addition to the present number of branches? 
Yes. We will be opening new branches across the country; we want a pan-India presence. Presently, BoM has 1,508 branches, which will touch 1,532 in FY 2011-12. Our aim is to achieve total business of `1,20,000 crore. We will be also setting up one specialised branch exclusively for assisting Self Help Groups mainly women.

If you look at the present scenario, youngsters are more interested in banking with a private sector bank rather than a public sector bank. Have you noticed this and do you have any plans to attract more youths towards BoM?
I have personally analysed this and one of the main aims as CMD of BoM will be to attract more youngsters to open accounts with us. If you look at the new generation, they are very tech-savvy and they want everything done with a click of a mouse or a button. In a changing world, public sector banks also have to keep up with that. We will be setting up three 3G techno savvy one-stop specialised branches in centres such as Pune, Mumbai and Delhi to cater to younger generations and high-value clients.

What about the financial inclusion plan?
The bank has drawn up a road map to provide banking services to every village having a population of over 2000, and such banking services may be provided through various forms of ICT-based models with the help of hand-held machines, smart cards and business correspondents (BCs), as a matter of commitment under financial inclusion. The bank has been allotted 1,215 unbanked villages to be covered under financial inclusion for extending banking and financial services and the plan has been realigned to roll out over a period of 2 years ie by March 2012.

Any new products that you will be introducing in this fiscal?
The board has given approval for Mahabank top-up loan- a loan facility to existing home loan borrowers to meet their personal needs, such as house repairs/ renovations, children’s education etc. Another product is Mahabank jewel loan - a loan facility against pledge of gold ornaments to meet personal needs/ agriculture and trading activities. Speaking about home loans, the trend in Pune is that people have again started investing in properties.

Some of the banks including Bank of Maharashtra in the middle of this year had reduced the home loan interest rates. What is the scenario now?
The prevailing interest rates on housing loans are quite realistic and affordable by middle-class population also. In India, housing is always given importance and interest rates were never very high particularly in public sector banks. The private sector banks, who charged high rates looked at the
increasing demand with a short-term perspective, have also brought down the interest rates now. You will find that there is no much fluctuation in interest rates of public sector banks. The trend is in conformity with the prevailing market conditions.