The Hindu Business Line : Corporation Bank looking at investment banking services

Mumbai, May 4 Corporation Bank is looking to offer investment banking and related services through its wholly owned subsidiary CorpBank Securities Ltd.

Speaking to Business Line, Mr B. Sambamurthy, Chairman and Managing Director, said, “We are examining a couple of activities in the capital market area, like investment banking.”

He ruled out retail broking for now, as the subsidiary does not have the required network.

CorpBank Securities is engaged in the distribution of mutual fund products. It posted net profit of Rs 14.57 crore for the fiscal ended March 2007-08, against a loss of Rs 20.18 crore for the previous year. The net owned funds have gone up to Rs 142.85 crore (Rs 135.03 crore).

The State Bank of India and IDBI Bank are two public sector banks whose capital market subsidiaries are active players in the investment banking area; and to a lesser extent, so is Bank of Baroda.

The bank is also planning to scale up its ‘branchless banking’ model from one branchless unit a branch to two to three units.

“This is one way of our outreach strategy, without having a conventional branch, which is very expensive,” he said.

The bank is also looking at offering products like general credit card, fixed loan and recurring deposits as part of the second phase of financial inclusion. “In the earlier phase banks opened ‘no frills’ accounts. Now we are taking financial inclusion as a livelihood programme and are adding more products,” Mr Sambamurthy said.

The bank is also looking to tie up with local partners, like a university of agriculture or milk dairy unions. Such organisations will give technical inputs to farmers for agriculture and allied activities, while the bank will provide the financial assistance, he said.

In the just ended fiscal, Corporation Bank posted a net profit of Rs 536 crore, a rise of 37 per cent from Rs 734 crore last year.

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