IDBI Bank is poised to acquire a bank that has a network of 1,000-1,200 branches and a good overseas presence. IDBI Bank is in talks with 2-3 banks.
"We want to expand our distribution network," IDBI Chairman VP Shetty told Business Standard. "We have the strength to acquire a bank with a large branch network." But he did not say when that would happen.
Some public sector banks with large branch networks are carrying accumulated losses on their books. IDBI Bank's reserves stood at Rs 5,170 crore (Rs 51.70 billion) on its March 2005 balance sheet and it posted a net profit of Rs 240 crore (Rs 2.40 billion) for the half-year ended September 2005.
When asked if the bank had finalised its insurance joint venture with European bancassurance major Fortis, Shetty said, "We are in the final stages of negotiations with Fortis, Generali and Dai-ichi Mutual."
The deal is expected to be finalised in the next couple of weeks. While the Generali group is the largest private insurer in Italy, Dai-ichi Mutual Life Insurance is one of Japan's top players in the sector (Nippon Life Insurance is number one).
The bank is also roping in a third partner for the insurance joint venture as Reserve of India Bank guidelines do not allow banks to hold more than 50 per cent in an insurance company. On the bank's organic growth plans, Shetty said, "By 2008, we will set up 345 more branches, of which about 35 will be composite services branches offering all services."
