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The mid-size public sector lender Dena Bank seeks to grow its balance sheet to ensure that it is not gobbled up by bigger banks, a top bank official said here today.
“The biggest challenge for Dena Bank is that we are one of the smallest. So, in the present environment, we have to go beyond a point to ensure that we are there in the future also,” the newly appointed Dena Bank Chairman and Managing Director, Ms Nupur Mitra, said on the sidelines of an IBA meet on innovation, risk and regulation here.
She also said the bank’s presence in Gujarat is making it more vulnerable for a possible takeover.
Ms Mitra said the public sector lender is taking various steps to increase its balance sheet size.
“Improvement in the balance sheet can be done through network expansion. At present, the bank’s network is tilted towards one State. We have to increase both our domestic as well as global presence,” she said.
The bank is also increasing its focus on SME sector lending for future growth.
About credit growth in the current fiscal, Ms Mitra said, “in the first half, the advances growth was almost flat. But we are looking at growth in the rest of this fiscal, especially in the SME sector. It will be around 20-25 per cent.”
The bank has not witnessed any rise in defaults despite the repeated rate hikes, she said.
About restructured portfolio, Ms Mitra said only 3-4 per cent of its asset is restructured and slippages from these restructured asset is nominal. She, however, said small banks are left out in the corporate debt restructuring process.
“In a CDR, the very spirit is getting violated as the small bank is left out in this process. As we are a small bank, we have a small exposure to the entity and we have to kind of toe the line of the big banks,” she said.
Dena Bank has reported 18 per cent rise in the second quarter net profit to Rs 193 crore compared to Rs 163 crore a year ago. The net income stood at Rs 515 crore, up 10.75 per cent against Rs 465 crore reported in the same period the previous year.
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