BoI, UBI inks pact with IDFC for loan syndication

New Delhi, Nov 8 (UNI) Public sector banks Union Bank of India (UBI) and Bank of India (BOI) today said they have entered into an agreement with Infrastructure Development Finance Co Ltd (IDFC) for loan syndication.

The arrangement will facilitate joint identification, marketing, appraisal and underwriting of project finance, which will provide a total solution to the promoters.

''BoI and UBI, who have good number of common customers, would like to give a single stop service to such customers to meet all their financial needs including arranging long term fund requirements for setting up new projects or expansion of existing facilities,'' Bank of India CMD M Balachandran said.

Chairman and Managing Director of UBI M V Nair said this is the first time two public sector banks have entered into a formal working arrangement to pool their skill sets to provide a single window solution to customers.

''IDFC has vast experience in appraising large infrastructure projects whereas BOI and Union Bank of India have experience in appraising working capital finance apart from project financing,'' Managing Director and CEO IDFC Rajiv Lall said.

In the present days of large project funding, pooling of skills of the three organisations will not only help handling the project finance requirement with speed, but also help these organisations to develop talents over a wide spectrum of industries, Mr Lall added.

At the same platform BoI and UBI announced a few more initiatives of working together. One such initiative is to offer Cash Management Services leveraging the technology and branch network of each other. Both the banks are using the same IT platform (Finacle of Infosys).

While BOI has implemented Core Banking Solution in 1008 branches covering more than 300 cities in 17 states, UBI has implemented Core Banking Solutions in 850 branches covering 241 cities in 22 states.

The arrangement will enable both banks to offer speedier and much efficient cheque collection facilities to their customers. Apart from a very strong presence in Western India, the inter-connected branch network of both the banks in other parts of the country will supplement the geographical spread and pass on the benefits to the customers. Such services till now available to corporate customers only will be made available to individual customers.

''Time has now come to pass on the benefits of technology implementation in banks to the individual customers of the banks in the form of improved collection services,'' M V Nair said.

Yet another area where the banks will join hands is in international operations where Bank of India will be the preferred bank for UBI for their overseas operations.

Commenting on the arrangement Mr Balachandran said BOI is having a strong international presence with 24 offices in 12 countries and will be soon expanding its operations to 4 more countries. This extensive network will be made available to Union Bank of India for all their overseas operations including raising of resources.

Both the banks will be sharing their extensive training facilities for mutual benefits. While Bank of India has their Management Development Institute at Belapur, Navi Mumbai and Staff Training Colleges at NOIDA (UP), Bhopal (MP), Kolkata (WB) and Chennai (TN) and state of the art IT Training facility at Pune, UBI is having their major training facility and Union Bank School of Management at Bangalore.

The unique sharing arrangement will help both the Banks to effectively use their resources to optimum level and at the same time achieve economies of scale and cost saving. The arrangement will not only help in taking training to the doorsteps of the trainees thereby saving on cost and time but also help in sharing expertise and infrastructure developed by both the banks over a period of time.

Both the banks are also looking for working together in some more areas, which are under discussion. The whole idea is to pool the limited and scarce resources/expertise together so as to achieve benefits in terms of costs and improve delivery to the customers.

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