The Kolkata-based United Bank of India plans to open branches in Bangladesh and Myanmar. The bank expects to double its advances to educational loans to around Rs 60 crore (Rs 600 million) during the current financial year.
Parkash Singh, chairman and managing director, UBI, addressing mediapersons in Kolkata said, "We plan to apply for a license to RBI to set-up offices in Dhaka and Yangon. We expect to leverage the strong presence we have in north-eastern India, by extending our operations to countries like Bangladesh and Myanmar."
UBI officials said that Indian government has set-up a committee to look into increasing its trade relations with Myanmar.
UBI is taking the opportunity of establishing its presence in that country. The bank has about 1,157 branches based in the north-east India out of its total 1,300 branches.
Prithviraj, executive director, UBI said, "There has been a boom in the educational loan segment. The interest rate is about nine per cent - the lowest in the banking industry. There are no securities for loans up to Rs 4,00,000."
He added, "Disbursements under educational loans was Rs 16 crore (Rs 160 million) in 2002-03. It has increased to around Rs 30 crore (Rs 300 million) for the year ended March 31, 2004. We have around 33 branches in southern India, which accounts for 25 per cent of educational loans disbursed. In a month, we would be adding two more branches -- one in Chennai and the other in Calicut."
UBI plans to go in for a centralised banking solution in the next six months. The investment of Rs 200 crore (Rs 2 billion) for this will happen over the next two years. The bank has invested Rs 200 crore in its IT initiative so far. The bank will increase retail exposure from 11 per cent to 15 per cent during current financial year.
The bank's total business was Rs 31,000 crore (Rs 310 billion), net NPAs to total advance was 4.3 per cent, gross NPAs was nine per cent for the year ended March 31, 2004.
The capital adequacy ratio increased to 16.63 per cent from 15.71 per cent. UBI expects to reduce its accumulated losses to Rs 500 crore (Rs 5 billion) from Rs 870 crore (Rs 8.7 billion).