Bank of Baroda scouting for partner for card biz

Bank of Baroda scouting for partner for card biz
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First Published: Sun, Sep 09 2007. 02 26 PM IST
Updated: Sun, Sep 09 2007. 02 26 PM IST
PTI
Kolkata: State-run lender Bank of Baroda (BoB) is scouting for a partner to revive its loss-making credit card business and compete with other players in the fast-growing segment.
“We will take a call to either merge the card division with the bank or take a strategic partner who has domain knowledge in the credit card business,” BoB chairman and managing director A K Khandelwal said.
“The loan recovery mechanism is very important as also aggressive marketing drive to compete with private players,” he said.
“If we do not find a suitable partner then we will merge and bring the card division in the retail business fold,” Khandelwal said.
He, however, said no final decision had been taken and it would take some more time “before we take the step”.
The credit card business under BoB Card has posted loss during the fiscal.
The bank has partnered with the Milan-based Pioneer Global Asset Management and sold 51% to revitalize its mutual fund. It has already merged its housing finance company with the bank as part of organisational restructuring.
Khandelwal did not disclose the valuation of the AMC, but said it received the premium amount from them. The AMC could be renamed BoB Pioneer.
On the foray into life insurance, Khandelwal said BoB would hold 44% and Andhra Bank 30%, while the rest of the Rs200 crore equity would be subscribed by Legal & General of UK, the strategic partner in the proposed joint venture.
In order to focus on fee based income, the bank will also begin capital market related services and has signed with India Infoline in this regard.
The bank is aiming at a total balance sheet size of Rs2,60,000 crore with credit growth of 22% during the current fiscal. On physical expansion, the bank would open 100 new branches in the domestic market and 10 overaseas.
To maintain its growth story, the bank has taken several strategies to improve the manpower pool to manage new areas including overseas expansions. Incentives and identifing and development of the internal talent pool was part of HR strategy.
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First Published: Sun, Sep 09 2007. 02 26 PM IST