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Aluva-headquartered Federal Bank is looking at substantial expansion of its footprint in the next 12-24 months by adding another 245 branches to its present network of 755.
“Our branch network would grow to 1,000 by the fourth quarter of 2012,” said the Chief Executive and Managing Director, Mr Shyam Srinivasan.
The bulk of this expansion is expected to happen in its home State, Kerala, besides others such as Tamil Nadu, Gujarat, Punjab and Haryana.
The bank, he said, is adequately capitalised to expand and grow.
ATM network
On the proposed addition to its ATM network, he said “this will not be as significant as expansion of branch network as Federal Bank customers have access to over 75,000 ATMs (of all banks) across the country and we do not charge our customers for using other bank ATMs.”
When the branch network reaches 1,000, the number of ATMs is expected to grow to 900, he said, adding “we will add another 200 ATMs.”
Asked about the need for establishing a brick-and-mortar branch when technology tended to drive banking services, he said: “Our branch presence will happen in the NRI and SME catchment areas. For establishing a branch in an area where SME presence is significant, you need to be relevant in their area/activity,” he added.
Mr Srinivasan also said that seven per cent of the country's NRI remittance came from Federal Bank and this was seeing good growth.
When asked about its NBFC subsidiary, Fedbank Financial Services, he said, “100 outlets have been inaugurated in the last six months. We are looking to have 300 outlets by March 2012.”
These outlets are at present operational in Tamil Nadu, Karnataka and Kerala. “We are looking at Gujarat and South Maharashtra for expansion of presence,” he added.
Biz growth
On business growth, he said Fedfina has grown by over 150 per cent in the last one year. “From Rs 900 crore last September, business volumes grew to over Rs 2,200 crore in end-June 2011. Referring to the gold loan business being taken care of by this NBFC arm, he said there is huge potential for growth in this space.
Asked how he managed to compete in this space, he said “we target a different clientele and our business model, product positioning and pricing are also different.”
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