IDBI Bank plans to open about 150 branches and add about 2,000 employees in fiscal 2013-14.
Of the 2,000 recruits, 500 would be for replacement and attrition while 1,500 would be for staffing its new branches.
“We have an advantage of being a young organisation with very few about to retire,” said R. K. Bansal, Executive Director, IDBI Bank.
The average age of IDBI Bank’s employees is 30 years, which, he said, was lower than its peer set.
An attrition rate of 5-6 per cent for a PSU bank such as IDBI is definitely on the higher side, he said, but pointed out that a significant number of its employees were on contract.
With a predominant presence in urban areas, the bank now looks to open more branches in rural and semi-urban areas to facilitate financial inclusion and priority sector lending.
As of end-December, 63 per cent (645 of its 1,019 branches) was in the urban areas. As of March 31, 2012, the bank’s total staff strength was 15,435.
ADVANCES
IDBI Bank sees advances growing at 15 per cent and deposits at 13 per cent in the next fiscal, said Bansal.
The bank logged Rs 1.86-lakh crore in deposits and Rs 1.71-lakh crore in advances with a balance-sheet size of Rs 2.73-lakh crore as of December 31, 2012.
“We are in the process of realigning our business mix of wholesale versus retail loans (agriculture/personal and SME) from 67:33 to 60:40,” said Bansal.
The bank is on course to end FY13 with a CASA (ratio of current account savings account to total deposits) at about 26 per cent. Last December, its CASA was at 22 per cent.
BANK LICENCE
On new entrants after the recent bank licensing norms put out by the RBI, Bansal said it would take them close to two years to receive approvals and begin operations.
Here, he felt existing private sector banks would see more attrition than public sector banks.
BASEL III
Most Indian banks would more than meet the Basel-III norms. It is just a matter of substituting their Tier-1 debt by equity. The banking sector’s return on equity (ROE) will dip from the existing levels of 14-18 per cent. However, an ROE of 12 per cent for a Basel-III compliant bank is good enough, he felt.
NON-PERFORMING ASSETS
NPA levels in the industry have bottomed out given the fact that there are no big cases in corporate debt restructuring.
Recovery however will take time, he said, as there are policy changes in most sectors. This would reflect only after the second quarter of FY14 as there were chances of delayed projects being revived.
Pick up of infra projects is taking time and export-related sectors such as gem and jewellery are under pressure, he concedes.
Bansal sees credit pick up in power, roads, telecom, steel, cement and textiles, especially from the private sector in the coming quarters.
IDBI Bank’s net NPA was Rs 3,302 crore (1.93 per cent) last December on higher provisioning.
raghavendrarao.k@thehindu.co.in