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Rediff News  All News  » Business » It's consolidation time: IDBI Bank chief

It's consolidation time: IDBI Bank chief

August 22, 2003 12:17 IST

IDBI Bank's new CEO Ajay Bimbhet will focus on consolidation and not expansion of the bank's operations.

IDBI Bank has around 99 branches and extension counters. It has another 10-12 branch licences.

"We have expanded into 78 cities in the country. We are not going into fresh cities. In some of the markets the branches have already reached the critical mass. We will consolidate our presence in markets we are rather than go into new markets," Bimbhet said.

Bimbhet has been appointed as the CEO of IDBI Bank after Gunit Chadha managing director and CEO, stepped down.

Bimbhet was the head of the retail bank. He is likely to keep both the posts till the bank finds a retail chief.

On the question of getting into any new business, Bhimbet said: "As we could not attract talent we could not get into any new business. Now that there is clear position on no-merger, we can get into new business like catering to the small and medium segment of business."

The Rs 154 crore (Rs 1.54 billion) rights issue of the bank is likely to hit the market by the end of next month.

The IDBI Repel bill which had been cleared by the cabinet allows IDBI to access retail business. However, it has not made any mention on the reverse merger of IDBI with IDBI Bank.

"Two positive things are happening with the bank: we are in the final stages of capital infusion and the reverse merger is also behind us. The bank was passing through uncertainties for the last couple of months and all hitches have been ironed out," pointed out Bimbhet.

The capital adequacy ratio of the bank which has gone below the 9 per cent mark in the first quarter of the fiscal year, will get a boost post the capital infusion.

"We will be comfortable with capital till March 2004," he said.

On the question of how IDBI Bank would function vis-a-vis its parent IDBI he said: "We will corporate wherever possible and compete where necessary to grow and expand the collective business."

BS Banking Bureau in Mumbai