IOB set to open subsidiary for financial services

Mumbai, Feb 4 (PTI) State-run Indian Overseas Bank(IOB) today announced it will soon start a dedicatedsubsidiary for financial services which will help it forayinto untapped areas like investment banking, wealth and assetmanagement and augment product offerings mix.

"We will be starting a subsidiary for (equity) capitalmarkets, asset management and wealth management services," theChennai-headquartered bank''s Chairman and Managing Director, MNarendra, told reporters here.

The public lender will be applying for the necessaryregulatory approvals for starting the subsidiary, he said,adding the unit will help the bank increase its products mix.

A slew of lenders like State Bank of India, KotakMahindra Bank and ICICI Bank already have a presence in thisspace, while Axis Bank entered the space by acquiring EnamSecurities recently.

Till the necessary go-aheads come through, Narendrasaid, the bank is in talks with leading brokerages for a tie-up to offer online trading services.

In another move, IOB - which kicks-off its 75thanniversary celebrations next week - plans to open 25dedicated branches in urban areas to give loans against gold.

Currently, the loan against gold segment is dominatedby non-bank entities and Narendra said dedicated branches willhelp the state-owned lender compete better.

"In existing branches, we are installing machineswhich will help in loan disbursal...basically we want to makethe process very fast so that a borrower can walk out with themoney in 15-20 minutes after applying," IOB Executive DirectorNupur Mitra said. .