Despite poor monsoon and economic slowdown, the Kerala-based Federal Bank expects credit growth of 20 per cent in the current fiscal.

Though, during the lean period, advances grew lower than targeted, they are expected to pick up in the coming months, said Shyam Srinivasan, Managing Director and CEO, Federal Bank.

“We have targeted 20-22 per cent growth, but hope to achieve close to 20 per cent,” he said.

Retail and gold loan businesses are doing well (gold loans which account for 27 per cent of its retail loan book, grew by almost 100 per cent in the first quarter). But lending to new projects has slowed down. “We are also cautious in this business. We continue to focus on SMEs, NRIs and agri-businesses.”

The bank, which has been on an expansion spree from last year, will open its 1,000th branch at Thiruvalla in Kerala on Friday. In the last 13 months, the bank opened 260 branches. The plan plans to add another 200 branches in the current year. However, this will depend on the performance of the newly opened branches, Srinivasan said. “One of the priorities has been to expand in our chosen geographies. We are now fairly well spread — in five States outside Kerala —Tamil Nadu, Karnataka, Gujarat, Maharashtra and Punjab,” he said.

The bank, which reported a 30 per cent increase net profit, in the first quarter, has been focussing on NRIs and SMEs in tier-II and tier-III cities.

“NRI business (which grew by 65 per cent in last quarter) help us get more local business. For every NRI account we get two-three captive accounts,” he said.

The bank accounts for 7.5 per cent of the total NRI remittance to the country.

The bank which has been hiring more than 1,000 people every year in the past two–three years will be adding about 1,200 people this year also.