Indian Overseas Bank Q3

IOB has reported a 35% drop in net profit at 75 Cr for the quarter ended December 31, 2013, against 116 Cr posted for the comparable previous year quarter. M Narendra, CMD of the bank, attributed the fall in net profit to higher provisioning towards bad debts and restructured accounts. The bank reported a slippage of 1,615 Cr during the quarter. According to Narendra, the bank provided 690 Cr for bad debts this quarter against 486 Cr in the previous quarter, and hence the coverage ratio was close to 57%. Total income went up by 6% to 6,190 Cr (5,846 Cr). “The year so far has been very challenging. And we have been focussing on recovery, and have recovered 206 Cr during the period,” he said. The bank’s net interest margin went down to 2.26% for the period, from 2.39% in the previous year period. Gross non-performing assets rose to 9,168 Cr (5.27%) during the quarter from 6,515 Cr (4.13%) last year. Net NPAs increased to 5,481 Cr (3.24%) for the quarter under consideration from 3,595 Cr (2.33%).

Average age of IOB staff will fall further: CMD

 

 

At Indian Overseas Bank, promotions are happening thick and fast. Officers can become managers in less than two years. Apart from a conscious attempt at fast-tracking talent, the rapid expansion of its branch network is helping youngsters grow fast. M. Narendra, CMD of the bank, said the bank has opened more than 1,200 branches and recruited some 11,000 people in the last three years. The bank recruited around 4,500 people in the current fiscal alone. Of them, around 2,600 are officers. The attrition level is minimal, he added. Narendra said the new recruits become managers within one-and-a-half years because of the opportunities thrown up by expansion. “The average age of employees is 46 now. Earlier it was 52-55. Ideally, my endeavour is to take it to 35 years,” he said, adding that the age profile will come down further in the next three years.

IOB to absorb 75% employees of Shree Suvarna Sahakari Bank

The Indian Overseas Bank will absorb 75% of the 340 employees of the failed Shree Suvarna Sahakari Bank (SSSB), an urban cooperative bank, once the takeover is completed on April 15. The rest have either taken voluntary retirement or have been denied absorption as they are facing criminal investigations. All the employees will be inducted at the base level that is the level of the fresh recruits. IOB chairman and managing director SA Bhat said the public sector bank will open branches at the 12 existing locations of SSSB’s branches, nine of which are in Pune.

IOB eyes Rs 10,000 cr biz from Pune with Suvarna Bank in fold

The Indian Overseas Bank is targeting a business of Rs 10,000 crore from Pune alone during the current fiscal with the acquisition of the assets and liabilities of the Pune-based Shree Suvarna Sahakari Bank Ltd (SSSB). All 12 branches of the SSSB will begin operating as IOB branches with effect from April 16. A majority of the existing staff of 340 have opted to continue to work and will be employed as fresh recruits, with no seniority, Mr S.A. Bhat, Chairman and Managing Director, IOB, has said. However, none of the charge-sheeted employees will be absorbed, he added. “The Reserve Bank of India has not given permission to take over Suvarna Bank’s branches, so 10 branches in Pune and two in Mumbai will be among the 93 branch licences given to IOB during 2008-09,” Mr Bhat said. The IOB programme to achieve 100 per cent core banking by April-end will be extended to these as well. IOB’s existing 10 branches in the city have a customer base of 40,000 and did business of Rs 3,000 crore during the last fiscal. Suvarna Bank has a deposit base of Rs 700 crore, advances of Rs 400 crore and 3 lakh customers. According to the current assessment, SSSB has gross NPAs of Rs 320 crore. With provision of Rs 240 crore, the net NPAs stand at Rs 70-80 crore