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Hyderabad, Sept 29

Development Credit Bank (DCB), whose IPO to raise Rs 157-186 crore capital has opened, is pinning hopes on the offer for implementation of its revitalisation programme. "The IPO enables us to improve our capital adequacy ratio (CAR) to around 19.5 per cent from the existing 9.1 per cent," said Mr P.N. Vasudevan, Head (Consumer Banking Group).

"The additional capital provides a comfort level for future asset growth and also complies with regulatory requirements, including Basel-II. The business growth through quality assets enables us bring down the high level of NPAs."

Speaking to newspersons on Friday, he said that the emphasis of the revitalisation programme would be on prudent risk management, addressing the historically high level of NPAs, reducing operating expenses, improving low-cost consumer deposit products and strengthening the focus on three core businesses - consumer banking, commercial banking and treasury.

He added that the bank planned to roll out a strong bouquet of new retail loan products as part of the plan and significantly expand its retail loan portfolio, but refused to elaborate citing regulations of IPO.

As a part of the business strategy, DCB proposes to continues its focus on growing current and savings account (CASA) size to further lower the cost of funds. The focus would also be on growing term deposits to facilitate the creation of liquidity to fund balance sheet growth.

(This article was published in the Business Line print edition dated September 30, 2006)
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