The Hindu Business Line : Dena Bank plans Rs 80-cr float

DENA Bank plans to raise around Rs 80 crore from the capital market by issuing fresh capital. The offer is expected to critically reduce the government's holding in the bank, now pegged at around 77 per cent.

The bank, as a means of increasing efficiency, is eyeing a reduction in non-performing assets (NPAs) even as it prepares to bolster its retail operations, said Mr A.K. Khandelwal, Chairman nad Managing DirectorMD.

He was addressing members of the Indian Chamber of Commerce (ICC) on Tuesday. Dena Bank, which will announce its fiscal 2004 results on May 7, hopes to achieve about 11 per cent growth in business, boosted by increase in deposits and advances. "This year we wish to reduce NPAs by a considerable margin. The rate of growth in business is expected to be higher," he said. Earlier, Mr Khandelwal referred to recent banking reforms, some of which were started in the early 1990s. "Banks will have to become more customer-centric in future. There is a need for greater efficiency, improved timing and cost reduction," he told the ICC members, adding that "internal reforms" (read an end to wasteful bureaucracy) and "responsiveness" will be important determinants in the days ahead.

Pointing out that relationships with customers are fast assuming a bigger role, the Dena Bank CMD underlined the need to create a cosmopolitan culture within banks. He also felt that consolidation (M&As within the sector) would provide scope for the next round of reforms. "These may well be voluntary in nature, rather than regulator-driven.

Banks will consider joining hands to increase competence and scale down expenditure. In future, banks will have to acquire and retain customers the hard way," he said.

Mr Khandelwal also urged banks to continuously improve their delivery mechanism, devise new products, tap e-commerce opportunities and enhance quality of manpower. There was need to focus on HR practices in order to motivate employees further, he added.