The Hindu Business Line : Canara Bank mulls stock broking foray

Canara Bank is exploring the possibility of entering two businesses which it feels have the potential to do well in future — stock broking and IT services.

The bank, which has more than a dozen subsidiaries focused on housing finance, asset management and venture capital, plans to tap opportunities that may arise in these areas.

Stock broking and IT services subsidiaries may well be formed in the coming days, provided the bank has the right business models in place, said Mr M. B. N. Rao, CMD, Canara Bank.

"Stock broking is clearly an emerging area in India," he said, adding that banks and the rest of the financial services sector have tried to leverage technology services to their advantage. "We may try to make use of this trend as well," he added.

Canara Bank is also trying to strengthen its presence in asset management and insurance. Canbank Mutual Fund, which has a relatively small asset base compared to the leaders in the mutual fun space, may consider shedding part of its equity in favour of a partner.

"We have examined a tie-up proposal with regard to the fund management company. Preliminary discussions have taken place with a few parties," Mr Rao told newspersons here. Proposals on insurance (Canbank currently sells Aviva's products) have been considered as well, he saidThe bank, which logged a global business of Rs 1.96 lakh crore in 2005-06, has targeted a marked increase in its deposits base from Rs 1.16 lakh crore to Rs 1.38 lakh crore this year. Advances, which stood at about Rs 79,000 crore at the end of the last fiscal, are expected to touch Rs 95,000 crore this year.

Canara Bank's wholly-owned venture funding subsidiary, which recently raised a Rs 100-crore fund, is targeting strategic exposure to emerging areas, including IT and pharma.

"We hope to deploy our resources in key segments," Mr Rao said, adding that the new fund (Bharat Nirman) has seen a number of public-sector banks and SIDBI entering as investors.

More Stories on : Financial Services | Public Sector Banks

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
IDFC buys 33 pc stake in SSKI

Canara Bank mulls stock broking foray

MFs offer more diversification now

To trust the mockery of unquiet slumbers

Momentum to regain strength