IndusInd Bank sees consumer fin loanbook up 20%

IndusInd Bank sees consumer fin loanbook up 20%

Mumbai: Private sector lender IndusInd Bank expects its consumer finance loan book to rise 20% in 2009/10 and 25% in 2010/11 on robust growth in the vehicle finance segment, a top official said on Friday.

“Our vehicle finance is picking up and we are seeing growth in auto, two-wheeler and three-wheeler segment," said Romesh Sobti, managing director and chief executive officer.

The bank also expects to maintain its target of 25-30% credit growth in FY10, he said.

“Demand from corporates for working capital loans and pick-up in vehicle finance segment will help (loan) growth," Sobti said.

The lender has a total loan book of Rs18, 500 crore . Consumer loans make up 44% of the loan book, while the rest is corporate loans.

IndusInd will bring more loans under coverage to raise coverage ratio, a key indicator of asset quality of banks, to 60% by March 2010, from 35% now to meet regulatory norms, Sobti said.

Provision coverage ratio is a measure indicating the extent to which the lender has provided against the troubled part of its loan portfolio.

The Reserve Bank of India in its recent monetary policy asked banks to raise provision coverage ratio to 70% by September 2010. IndusInd also expects net non-performing assets to be below one percent in the current fiscal, Sobti said.

At 1.55 p.m., shares in the bank, with a market capitalisation of Rs5770 crore, were down 0.71% at Rs139.75 in the Mumbai market that was down 0.25%.