Allahabad Bank Maintains It's Momentum For Growth
The Bank is moving along its growth path in business accretion and also
increased its market share through improved performance.
The highlights of the performance for the half-year ended
September 2005 are summarised as under:
The Business of the Bank crossed Rs.68,933 crores as at
September-end 2005.
Year-on-Year basis, the Business increased by 24.59%.
As at Sept-end 2005, the market share of the Bank in aggregate
deposits increased to 2.26% as against 2.14% in the corresponding period last year.
Market share in advances also increased to 2.01% from 1.99%
during this period.
Operating Profit was Rs.471.79 crores during the April-September'05.
Operating Profit (Excluding Profit on Sales of Govt. Securities)
increased from Rs.311.37 crores during April-Sept.'04 to Rs.417.26 crores during
April-Sept'05, registering a growth of 34.01%.
Net Profit of the Bank increased from Rs.303.22 crores to Rs.331.33
crores during this period, showing a growth of 9.27%.
Net NPA to Net Advances ratio reduced to 0.97% as at September-end 2005
from 1.64% as at September-end 2004.
Capital Adequacy Ratio improved to 13.32% as on 30.09.2005 from 12.74%
during the corresponding period last year. The Bank is fully prepared for compliance of
new Basel II norms effective from 1st April 2006.
Return on Assets (ROA) increased to 1.33% during April-September'05 from
1.20% during 2004-05.
Earning per share (EPS) stood at Rs.15.32 with diluted equity as against
Rs.15.63 as on 31.03.2005 and Book Value increased to Rs.77.76 from Rs.67.14 during the
same period.
INTERNATIONAL BANKING
Bank's first overseas branch is expected to be opened shortly. Relevant
papers are being finalised for submission to HKMA (Hongkong Monetary Authority) for their
final clearance.
The Representative Office at Shenzen, China is also in advance stage.
AGRICULTURAL CREDIT
The Bank has formulated its plan & strategies for stepping up its
lending under Priority Sector Credit particularly in Agricultural and SME Sector in line
with the policy announcement of the Government of India. The Bank has already established Indira
Gandhi Farmers' & Entrepreneurship Development Institute at Rae Bareily, U.
P. has already operationalised integrated model of providing training, credit and
facilities of Backward & Forward linkages to farmers /rural entrepreneurs. A large
number of Farmers in nearby villages are attending the training at the institute. The Bank
has planned to open such institutes at Western & Eastern UP and West Bengal. This will
enable the Bank to have better product penetration and increased business volume.
The Bank has developed a scheme for financing the Micro-Finance
Institutions (MFIs) for on-lending to SHGs upto Rs.2 crores at the lower interest rate
based on internal as well as external rating of MFIs.
A new scheme for financing supply chain of agricultural inputs to farmers
has been introduced with maximum loan limit of Rs.3 crores per unit and with a reduced
interest rate of PLR-2%.
Nearly 75000 Kisan Credit Cards (KCCs) have been issued during the first
half of FY-06
Kisan Credit Card(KCC) scheme for production credit and Kisan Shakti
Yojana(KSY) scheme for investment credit have been integrated and a common card named
"Kisan Credit-cum-Kisan Shakti Card" has been a great success as a business
strategy to boost farm credit.
TECHNOLOGY NETWORK
The Bank has 1964 branches out of which the Bank has computerized 1714
branches covering 93% of the business. All branches to be computerized by March,2006.
At present, the Bank has 100 ATMs and another 100 ATMs will be installed
by 15th November 2005.
To computerize the remaining branches, the Bank has procured source code
of application software for uniformity at all branches that would enable smooth
integration with the Core Banking Solution (CBS).
RISK MANAGEMENT
Risk Management practices has been set up at various operational levels
for measurement, mitigation and management of various risk factors.
The Bank is already geared up for compliance of Basel-II requirements.
The increased profitability and additional capitals mobilised through Follow on Public
Issue has made this easier.
Centralised Credit Appraisal Cells has been set up at selected zonal
offices with proper networking arrangement for better processing of credit proposals and
prompt decisions.
MARKET PENETRATION & VISIBILITY
An intensive publicity campaign has been launched to popularize its
various products through print and electronic media.
Centrestage of this campaign are our products viz., 1) Education Loan,
2) Housing Loan, 3) Savings Bank, and 4) KSY etc.
The Bank has introduced a good number of value-added products both on
deposits and credit link areas.
COMPTENCE BUILDING INITIATIVES
Competency Mapping exercise for the Senior Executives has been done by
National Institute of Bank Management (NIBM) as our consultant and Competency Based
Training (CBT) is being introduced.
The XLRI, Jamshedpur is in final stage of submission of its
recommendation to
Increase managerial competency at all levels of employees.
Improve human & technical resources as centers of excellence.
Develop a culture for improving competitiveness.
NEW FRANCHISES
The Bank has executed MOU with SIDBI for financing for Technology
upgradation of SSI units under Credit Linked Capital Subsidy Scheme.
A tie-up arrangement has been made with Small Farmers' Agri-Business
Consortium for implementation of Venture Capital Assistance Scheme to provide venture
capital assistance and project development facility to producer groups/ entrepreneurs/
trained agri-business graduates/ units in Agricultural Export Zone.
A joint venture is being set up with AllBank Finance Ltd., a wholly
owned subsidiary of Allahabad Bank and another partner to commence General Insurance
business. M/s Ernst & Young is preparing the necessary due diligence report etc.
The Bank has tied-up with Wall Street Finance, the primary agent of
Western Union Money Transfer for inward remittance of money from various foreign
countries.
A new tie-up arrangement has been made with Principal PNB-Mutual Fund
for cross selling of Mutual Fund Products.
FUTURE PLAN
The Bank has planned to reach Rs.80000 crores of business by March,2006.
Long term vision upto 2010 is under process, which includes HR initiatives, upgradation of
Technology and Business Process Re-engineering.
With a view to achieving the Vision 2010, the Bank has identified the
following thrust areas :
Retail Banking
Improved marketing strategies
Innovation of Products suitable for different segment of customers
Improvement of delivery channels
Agricultural Credit Delivery & SME :
New products for wholesale lending to MFIs & NGOs for development of
a strong micro credit portfolios, in future.
Formulation of area based schemes with locally available resources and
proper linkages.
Introduction of appropriate techniques for customer satisfaction.
Expansion of network for branches in the areas having lesser presence.
Customer Friendly Service to Small Depositors:
The Bank has already established its visibility and strong
presence in the market and we are confident to move in a faster pace to consolidate our
position in the coming days.
Kolkata
17th October 2005.
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