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May 3, 2001
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Money > Business Headlines > Report May 3, 2001 |
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IndusInd plans asset buyout of banksGeorge Smith Alexander The Hindujas-controlled IndusInd Bank is planning to buy out assets from nationalised banks as well as old private sector banks and even non-banking finance companies. The objective is to boost the bank's balance sheet size. The bank is looking at acquiring the bills portfolio, corporate business (top tier), retail business or even some branches of the banks. "Picking up branches will be better than setting up our own network," deputy managing director Bhaskar Ghose said. In the case of NBFCs, the bank is looking at processing business such as custody business, depository services and technology-oriented business. Taking up the portfolio of depository services will help the bank to tap new customers, he said. The bank is also in talks with two German banks and a US bank for strategic equity placements to bring down the promoters' stake. "The advantage the bank will have (in the proposed deal) will be in terms of new technology, expertise and additional business," said Ghose. "The bank is looking at different options -- ranging from having a strategic partner to picking up business lines of banks or NBFCs and even acquisition of an old private sector bank. However, acquisition will be the last on our priority list," he pointed out. The IndusInd Bank board in its meeting on April 28 approved the appointment of Ghose as the managing director and chief executive officer. The matter is pending with the Reserve Bank of India. The bank is interested in picking up business of other banks and NBFCs than a merger or a takeover of another bank as this well help it avoid merger pangs, said Ghose. The bank can grow in two ways -- organically as well as inorganically. "However, taking over another bank will not help boosting shareholders' value immediately as it will have to look at cutting down cost to improve the bottomline," he said. Powered by YOU MAY ALSO WANT TO READ:
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