Union Bank targets Rs 160,000 crore business,opens foreign branches

Kolkata, Jul 17(UNI) Public sector Union Bank of India is poised to take the total business volume to a record Rs 160,000 crores by March 2007,besides spreading its wings overseas by opening the first four foreign offices this year.

This was informed here today by the Chairman and Managing Director of the Bank M V Nairto newsmen on the sidelines of a FICCI sponsored Banking Conclave.

He said in order to achieve about 20 per cent growth in business during the current fiscal by the bank from Rs 128,000 crores, they had decided to focuss on extending the Bank's retail,Agriculrural, SMEs and Corporate credit exposures by about 25 per cent each.

"We are also planning to add 100 more branches to our all India network of 2220 branches before this year end," Mr Nair informed.

On maiden overseas venture in the globally competitive environment, the Union Bank CMD said of the initial four foreign offices,two would come up as full-fledged braches in Doha and Hong Kong,while the other two would be set up in Shanghai and Dubai as representative offices soon.

"We have already received the necessary permission from the Reserve Bank of India (RBI)and are now awaiting similar clearance from the concerned countries which are expected shortly",Mr Nair said and claimed that the foreign venture would open a new window of opportunity for the Union Bank which was already serving more than a million customers across the country.

Asked whether the 87 year old bank was looking for an opportunity to widen its capital base in the backdrop of extensive future programmes, Mr Nair said despite the expansion the Bank would be comfortable with its capital adequacy ratio which was presently hovering around 11.4 per cent.

"With this capital adequacy we would be able to qualify for the Basel II norm quite comfortably by March next",Mr Nair said and ruled out hanving any plan for fresh acquisiton or merger with any other financial institution.

About the prospect of experiencing a quantum jump in the fee-based income of the Bank,the CMD said following very successful tie ups with the HDFC Standard Life Insurance and LIC for life insurance products and with New India Insurance and five major Mutual Fund players for non-life schemes,the Union Bank was all set to increase its volume from Rs ten crores last year to over Rs 50 crores during the current fiscal recording about 500 per cent jump.

Earlier, addressing the Banking Conclave Mr Nair provided a picture about the scope of tapping the huge and mostly untouched Indian rural Market for banking,and showed how the Indian public sector banks were coping with the challege and making steady inroads.

Describing rural India with about 600,000 villages as the economic powerhouse,Mr Nair, through a powerpoint presentation, described how the bank was making steady progress in bringing about 93 per cent of rural population into the banking fold with several innovative and friendly products.

"We are planning to set up about 200 village kiosks and about 100 Village Knowledge Centres to reach the doorsteps of over 2000 selected villages this year and bring their entire population under our fold," the Union Bank CMD said.

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