Mumbai: State-run Dena Bank is aiming to increase its share of the low-cost current and savings account (Casa) deposits which will help it increase the net interest margin (NIM) to 3.10 percent.
"We are targeting to increase the Casa deposits share to 33 percent by March from the current 31 percent. That will take the NIM up to 3.10 percent," newly-appointed Chairman and Managing Director Ashwani Kumar said.
Kumar, who assumed charge on January 1, said officers and field staff have been on a drive to increase Casa deposits. "We have good presence in Maharashtra and Gujarat, therefore, meeting the targets should not be a worry."
The bank's Casa ratio and NIM levels have not changed much in many quarters and hence a push is needed, he said.
In its branch banking strategy, Dena Bank is counting on a comparatively younger staff (its average employee age is 43) to drive the business, Kumar said.
The bank has successfully pared down the share of the high cost bulk deposits to about 18 percent of the overall pie, from over 22 percent it started the year with.
On the lending side, it will concentrate on retail and small businesses, he said. In the next fortnight, the bank is scheduled to open 15 new branches in the SME clusters in Punjab and Haryana.
Kumar sounded content with the asset quality and said the bank is outsourcing due diligence to external agencies like Crisl and Dun & Bradsheet for every SME loan.
On the capital adequacy front, Kumar said he expects an infusion of Rs 600 crore from the government by March. This will take its core tier-I capital to over 9 percent from 8.10 percent in the September quarter, he said, adding a request for another Rs 600 crore has been made for FY14, as bank gears up for the implementation of the Basel-III regulations.
About the talk of need for consolidation within the state- run banks, he said, "there will not be a forced merger".
Kumar said the bank was one of the biggest at the time of nationalisation in 1969 and his effort will be "to regain past glory" and also make it more technology savvy.
First Published: Sunday, January 20, 2013, 14:36