Financial Daily from THE HINDU group of publications
Tuesday, Jul 30, 2002
Financial Daily from THE HINDU group of publications Tuesday, Jul 30, 2002 |
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Money & Banking
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Private Banks Info-Tech - Mergers & Acquisitions Lord Krishna picks 20% in Flexcel Our Bureau
Mr V. K. Gupta, Executive Director, Lord Krishna Bank, and Mr A. Rajan, CEO, Flexcel International, at the signing of the agreement in Mumbai on Monday.
MUMBAI, July 29 THE Kochi-based Lord Krishna Bank has picked up a 20 per cent equity stake in Flexcel International, an Application Service Provider (ASP). Flexcel International with a Rs 20 crore equity capital is a 50-50 joint venture between the HDFC Bank group and i-flex solutions. Their stake will now come down to 40 per cent each. "We see tremendous growth in the ASP model and we want to be a part of this growth,'' Mr Ashwani K Puri, Director, Lord Krishna Bank, said at a press conference. Lord Krishna Bank has also tied up with Flexcel International for its banking software solutions. "This is a five-year contract with Lord Krishna Bank by which Flexcel will deploy, host, manage and rent access to Flexcube, a centralised software banking solution of i-flex solutions Ltd from a centrally managed data centre,'' said Mr A. Rajan, CEO, Flexcel International Pvt Ltd, at the press conference. The bank will be able to provide more efficient service and save substantial costs through the ASP model, said Mr V.K. Gupta, Executive Director, Lord Krishna Bank. The ASP model will be implemented in 45 of LKB's branches and 40 of its ATMs by the end of this financial year. This will automate all the banking operations and offer `Anywhere Banking' from these branches. The bank plans to add 25 more branches in the Northern and Western regions of the country and increase its ATMs count to 50 from the presently existing 19 by the end of the financial year, said Mr Gupta. Flexcube, the core banking solution is being offered for the first time on a `rental basis', which can save a bank 65-70 per cent costs over three years, as against on a `license basis'. "The ASP model is ideal for all commercial banks with comparatively less number of branches and foreign banks looking for low cost data centre operations in India. There are 4-5 banks in the pipeline eyeing this model,'' said Mr Rajan of Flexcel International. Flexcube has been available in India since 1997 and is being used on a `licence basis' by HDFC Bank, Syndicate Bank and Bank of Baroda, among others.
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