The Hindu Business Line : Tap new avenues to grow, banks told

The Deputy Governor of Reserve Bank of India, Mr V. Leeladhar, has urged the public sector banks to make efforts to grow both organically and inorganically.

Addressing the staff members of Corporation Bank during his visit to the bank's corporate office, Mr Leeladhar said, "The road map for opening up Indian banking sector in 2009 is already drawn. Competition will be intense in the days to come. Size becomes a critical factor. Efforts to grow both organically and inorganically need to be stepped up."

He urged them to embrace newer avenues for survival in the long run. "These para-banking services, no doubt, take away some of the traditional business of the banks, but surely help them earn and improve upon fee-based income," he said.

Mr Leeladhar also underscored the need to provide innovative products and quality service to customers to prevent client attrition and enhance business growth. He said the herd mentality in pricing followed by public sector banks should be discouraged. Cautioning the banks about increasing instances of frauds in the home finance area, he said that proper system of due diligence is to be followed. He also emphasised the need for reorienting the training system for re-skilling the employees.

Mr B. Sambamurthy, CMD,, welcomed Mr Leeladhar.