Big UCBs from outside plans to open branches in Kerala

The Hindu BusinessLine says :

Mumbai, June 7: 

India's top three urban co-operative banks — Saraswat Co-operative Bank, Cosmos Co-operative Bank and Shamrao Vithal Co-operative Bank — may soon spread their wings across the country and give private sector banks tough competition.

Following the Reserve Bank of India's nod for expanding its area of operations, the Mumbai-headquartered Saraswat Bank is drawing up plans for an all-India footprint.

Currently, the area of operation of India's largest UCB is restricted to six States — Maharashtra, Goa, Karnataka, Gujarat, Madhya Pradesh and Delhi. It has a network of 217 branches.

“We have already applied to the RBI for issuing licences at 96 locations. Our target is to reach a business (deposits plus advances) level of Rs 50,000 crore by March-end 2016 from Rs 27,313 crore as on March-end 2011,” said Mr Eknath Thakur, Chairman, Saraswat Bank.

The RBI is amenable to granting permission to well-managed

and financially sound UCBs to expand their area of operation. Hitherto, UCBs could not expand their operations beyond a few States.

Cosmos Bank (as on March-end 2011, total business, Rs 15,521 crore; and branches, 119) and Shamrao Vithal Bank (total business, Rs 10,512 crore; and branches,105) have sought the regulator's permission to expand their area of operations.

The conditions

The RBI will allow an urban co-operative bank to become a pan-India bank provided it has, among others, a minimum capital-to-risk-weighted assets ratio of 9 per cent, a minimum Grade II classification, net worth of Rs 500 crore or more, according to Mr Shashikant Bugde, Chairman, Cosmos Bank.

“We have applied to the RBI to have a pan-India presence. Currently, we have branches in Maharashtra, Gujarat, Madhya Pradesh, Karnataka and Andhra Pradesh.

“Once the regulator gives us permission, we will expand our operations to Delhi, Goa, Tamil Nadu, Rajasthan and Tripura,” he said.

Shamrao Vithal Bank plans to open branches in all States once the central bank's permission comes through, said Ms Himangee Nadkarni, Chief Financial Officer.

Ibnlive.com says..

PTI | 11:06 PM,Jun 08,2011

Saraswat Bank has been granted a pan-India operation license by the Reserve Bank, making it the first co-operative bank in the country to be accorded this permission, it said today. The bank's chairman, Eknath Thakur, said, "The 93-year-old bank will be concentrating first on opening branches in the southern Indian states of Kerala, Andhra Pradesh and Tamil Nadu, to be followed up by national capital region and northern states." By end-FY16, Thakur said, the bank is targetting to expand its network to five hundred branches from the present 216, with the uncovered region getting increased attention. Thakur said that the bank's total business mix has crossed Rs 28,000 crore today, to make it the undisputed leader amongst cooperative banks in the country. It overtook the Maharashtra State Cooperative Bank which had a business mix of Rs 27,800 crore before its board was dissolved last month, Thakur said.