Union Bank select retail branches target Rs 6,000-cr lendings

MUMBAI: In an ambitious move to boost its retail lending, public sector lender Union Bank of India (UBI) plans to disburse around Rs 6,000-crore per annum through 32 special retail asset branches.
   
These branches would be set up pan-India over the next one year and each branch would have a disbursement target of around Rs 10-15-crore per month, UBI's Chairman and Managing Director, M V Nair, told here.

In addition, the bank will be setting up 12 SME `saral' centres with a monthly disbursement target of Rs 10-crore. The bank is betting big on the SME segment and expects a 35-40 per cent growth in this segment.
   
"We want to aggressively grow our retail portfolio. The SME segment, retail and agri-credit would constitute the three growth engines for the bank over the next three years," Nair said.
   
The retail asset centres will focus exclusively on pushing the bank's retail products such as home loans, auto loans, educational loans and the like, he said, adding these and the SME centres will essay a very important role in pushing our retail lending.
   
UBI, whose net interest margin (NIM) has declined this fiscal, aims to improve its yield on assets and up its NIM through this strategy of growing its loan-book in segments where yields are higher.
   
The bank's NIM had declined to 2.86 per cent as against the targeted 3 per cent as at end-H1 FY 08. Nair admitted that it would be "tough" to achieve the 3 per cent target "but we will come very close to it."