• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest
• The New Manager

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Our Bureau

Chennai March 18 It does not take much to automate or network a rural branch, says Mr T. Valliappan, Executive Director of Vijaya Bank.

The bank has successfully tested networking 60 of its rural branches using VSATs. "We now intend to scale it up to cover all our 400-odd rural branches," Mr Valliappan told Business Line.

Vijaya Bank, according to Mr Valliappan, has found out that there is immense scope for business in the rural areas. "You will be surprised — our recently-inaugurated Kothamangalam branch got us low-cost deposits of over Rs 3 crore," he said.

The trick is to empower the small town bank customer with facilities to bank at any time. The biggest problem with rural branches is the uncertainty of power availability. Vijaya Bank is trying to solve this problem using solar power systems. Again, the bank has installed solar power systems (provided by Tata BP Solar Ltd) in 60 of its rural branches and "they are working extremely well".

These systems cost only about Rs 5 lakh. With VSATs (of Hughes), the rural branches are also to be linked to the central server. All core banking facilities could be offered. Meanwhile, Vijaya Bank is talking to arrangers for raising capital. Its capital adequacy ratio is about 11.5 per cent, and the bank intends to raise hybrid capital of around Rs 1,400 crore.

However, Mr Valliappan stressed that Vijaya Bank was comfortably placed as regards liquidity.

The bank is sitting on excess SLR securities of about Rs 775 crore, which could be liquidated at any time and used for funding credit growth. Its investment book of Rs 12,402 crore yields 7.9 per cent on the average.

Besides, the bank is very well provided for against non performing assets. Compared with gross NPAs of 2.5 per cent, net NPAs are only 0.49 per cent, reflecting a coverage of over 80 per cent.

As the recovery environment is better, the bank is able to effect cash recoveries.

More Stories on : Public Sector Banks | Rural Development

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

Stories in this Section
Indbank to open 10 more branches

Copyright © 2007, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line