Indian Overseas Bank (IOB) will focus on low-risk mid-corporate and jewellery loan segments to drive income growth.

IOB had “tremendous strength” in certain segments such as mid-corporate, jewellery and housing. “We are bringing back focus on these segments,” said R Subramaniakumar, Managing Director and CEO of IOB in a recent interview to BusinessLine .

The bank has created new relationships through several initiatives in the mid-corporate segment. The refocus efforts appear to have paid dividends.

In the jewellery segment, its advances fell to ₹10,000 crore in March 2017 from about ₹17,000 crore in March 2014. To revive momentum in this business, IOB has established a new jewellery loan cell at its head office, a first-of-its-kind initiative.

The entire process has been simplified and branch level guidance is provided. “We are confident of taking the loan portfolio back to ₹17,000 crore soon,” said Subramaniakumar.

This doesn’t require capital as it is a zero risk-weighted assets category. “Revenue generation from this will help meet our additional provisioning requirements,” he added.

Also, the bank aims to lend sharper focus on the housing loan segment and as part of the retail push, a separate retail vertical has been established and the processes moved totally to digital from lead generation to sanction.

A new model, ‘Retail Mart’, has been initiated in over 50 branches and the programme is anticipated to transform retail lending.

“Coupled with a scoring model for MSME loans, establishment of the new retail vertical model has improved the confidence level at the branch level. Higher growth in these areas will increase our bottomline,” he said.

Another key part, according to him, is that IOB has also started giving market rates of interests. Housing loans, for instance, are offered at sub-9 per cent (8.55 per cent up to ₹75 lakh) levels.

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