Financial Daily from THE HINDU group of publications
Thursday, Apr 10, 2003
Financial Daily from THE HINDU group of publications Thursday, Apr 10, 2003 |
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Money & Banking
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Private Banks Kotak Mahindra plans 75 branches in 3 years Our Bureau
NEW DELHI, April 9 THE promoters of Kotak Mahindra Bank (KMB) would reduce their stake in the bank during the next fiscal to comply with the RBI stipulation of capping promoter's equity at 49 per cent. Although the exact modalities of the reduction in equity were yet to be worked out, the KMB Vice-Chairman Mr Uday Kotak, told reporters here today that the promoter family's stake would be reduced by 11 per cent from the present level of 60 per cent by 2004 to comply with RBI norms. "The board could consider mergers, public offers and private placement. It will have to be worked out," he said. RBI had recently relaxed the limit of promoters holding in private banks to 49 per cent from the earlier level of 40 per cent. Asked whether the bank was in favour of acquisitions, he said, "we are open to these ideas. But no concrete plans are in place." The bank has a non-performing asset (NPA) level of 0.01 per cent and a capital adequacy ratio of 28 per cent. It was able to meet its mandatory cash reserve ratio (CRR) and statutory liquidity ratio (SLR) requirements of about Rs 400 crore at the outset, he said. Inaugurating the bank's first branch in the capital, Mr Kotak said the bank would leverage its strengths in the capital markets and investment banking sectors to offer complete finance solutions to its high net-worth customers. "The future of banking is not so much in the products that a bank can offer as in the level and quality of service. There is a great need for a bank to demystify finance and make sense to a financially bewildered customer," Mr Kotak said. He pointed out that KMB was the first instance in the country of a company converting itself into a commercial bank. With experience in most aspects of finance such as mutual funds, equity, personal finance, car loans and retail, the bank hoped to integrate banking and finance services for its existing and new customers, he said. KMB has chalked out plans to open 75 branches across different parts of the country in the next three years with greater stress on Delhi and Mumbai. The bank's customers would have access to 5,300 Visa and UTI Bank automated teller machines (ATM) and would be offered free home delivery of cash and other banking products.
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