The Hindu Business Line : Lakshmi Vilas to focus on low-cost deposits

Mr V.S. Reddy, Managing Director of Karur-headquartered Lakshmi Vilas Bank has, since assuming charge about 8 months ago, been emphasising the need for a complete transformation.

He told Business Line that the transformation process has finally started at the bank, with the board and workforce willing to accept change. He was referring to issues such as restructuring the asset-liability portfolio, accelerating low cost deposits and CASA, introduction of structured loan products, and go-to-market and HR initiatives among others.

“Our high cost deposits are huge compared to low cost deposits and CASA. We are inching towards mobilising low cost deposits. About 300-350 new accounts are being opened everyday across our branches at present compared to 20-25 a year ago. We are targeting to rope in 2 lakh new customers this fiscal,” Mr Reddy said.

Besides acquiring new customers and penetrating into unbanked pockets, the bank is also considering to cross-sell its products. “We will not depend on mutual fund agencies, but will look at institutions for marketing our range of products, including structured loan products,” he said.

On restructuring of assets, he said “Most advances carry low rate of interest. We are addressing this issue by removing the stress on assets. We are also trying to rope in large corporates and broad-base/diversify our portfolio. These accounts would initially be pooled in select 30-40 branches.”

On rate hike, he said “It is a real challenge and could be difficult for all banks. Market share may not be a problem, but we will strive hard to grow further.”

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Lakshmi Vilas to focus on low-cost deposits