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Federal Bank is not looking to reorient its strategy towards “inorganic growth” for now, Shyam Srinivasan, Managing Director and Chief Executive Officer, has said.
The private sector bank will continue to focus on ‘organic growth’ even as competition was adopting the merger route for growth, Srinivasan said in response to BusinessLine ’s question on whether it would now look at acquisitions for growth.
Srinivasan’s remarks are significant as these come close on the heels of Kotak Mahindra Bank, a private sector lender, acquiring Bengaluru-headquartered ING Vysya Bank in an all-stock deal, which catapulted Kotak Mahindra Bank to become the fourth-largest private bank in the country in terms of total business.
Srinivasan said Federal Bank still had more branches (1,247) than Kotak Mahindra Bank (1,214 branches) after its acquisition of ING Vysya.
He said while there was no proposal for buying out another bank, Federal Bank, was not averse to buying “good quality portfolios”.
“We are very much open to acquiring good quality portfolios (of assets),” Srinivasan said, adding that the bank would be careful in its choice given the weak asset quality environment in the banking industry.
Federal Bank had closed the just ended fiscal with a credit growth of about 18 per cent.
For the current fiscal, the aim is to grow its advances at 600-800 basis points over the banking industry’s growth rates, Srinivasan said.
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