Page 6 - Banking Finance June 2021

BANK UPDATE

its Managing Director and CEO A S This will minimise the delinquencies HDFC Bank expects SME
Rajeev said. In April this year, the and attract lower capital
Pune-based lender had received board requirement," Rajeev added. to be the fastest growing
approval to raise Rs 5,000 crore by way segment
of QIP/rights issue/ preferential issue or Ujjivan Small Finance Bank HDFC Bank plans to leverage its
by issuing Basel III bonds. "We are distribution in non-urban markets and
planning to raise around Rs 2,000 crore collaborated with digital strengths to expand its small
equity through QIP immediately. The MoEngage and medium enterprise (SME) banking
process has already started and we will
Ujjivan Small Finance Bank said it has platform.
raise it before Julyend," Rajeev told in collaborated with customer
an interaction. The management said that recent
engagement platform MoEngage to changes in the management structure
The base size of the issue is Rs 1,000 drive digital banking experiences in the were aimed to facilitate a far more
crore and it has a greenshoe option of unserved and underserved regions of focused approach towards execution in
another Rs 1,000 crore, he said. the country. this vertical and Rahul Shukla will drive
Following this equity raise, the growth in the business. The bank
The engagement aims to build a vast
government's holding in the bank will presence of the bank for connecting expects the SME business to be the
reduce to below 85 per cent from 94 with customers in these regions fastest-growing segment over the next
per cent currently, and the capital
through multiple digital touchpoints, a three-five years.
adequacy ratio will improve to 17-18 statement said. The partnership, it
per cent from around 14.49 per cent added, will foster holistic customer "(The) bank is cognizant of the asset
as of March 31, 2021, Rajeev said. quality risks associated with this
experience across all organic channels, segment and hence will keep
This fund will be deployed for expansion like the website, app, email, text underwriting and collection teams
of the loan book, which the bank is message, social media and branches to tighter," it said.
looking to grow by 16-18 per cent to drive business growth.
around Rs 1.25 lakh crore in this fiscal In April, HDFC Bank announced an
from Rs 1.08 lakh crore as of March 31, Ujjivan Small Finance Bank will target internal reorganization that would see
SMS campaigns to encourage digital it form three distinct focus areas,
2021, he said. Of the total loan book
repayments. SMS campaigns, the namely, business verticals, delivery
of the bank at present, the share of channels, and technology. It has
corporate loans is 37 per cent and of statement said, will offer options to named this exercise, Project Future-
retail, agriculture and MSME (RAM) customers to make payments either Ready. As part of the reorganization,
segment is 63 per cent, he said adding, digitally or through cash deposit. Shukla is now responsible to drive the
"We want the ratio of RAM to the Dheemant Thacker, head of digital commercial banking and rural vertical.
corporate segment to be 65:35 during banking at Ujjivan Small Finance Bank
the current fiscal." The bank is said this partnership is an effort to
envisaging a 20-25 per cent growth in enhance the digital knowledge and Bank of India conducts
the retail, agriculture and MSME experience in the unserved and vaccination drive for
(RAM) segment this year. underserved markets, thereby employees and their
strengthening its presence.
The lender's corporate loan size is
close to Rs 40,000 crore and it is As door-to-door EMI collection became family members
targeting to grow it by another Rs a challenge during the pandemic, Bank of India said it has concluded a
10,000 crore in this financial year. It Ujjivan Small Finance Bank created a massive three-day covid-19 vaccination
has a sanction pipeline of Rs 25,000 comprehensive digital infrastructure drive at its head office in Mumbai,
crore in the corporate and MSME through payment integrations with inoculating 1,330 employees and their
segments for the current fiscal, he Bharat Bill Payment System family members.
said. "We have churned our portfolio aggregators and partnership with a This was done through an arrangement
with improvement in the share of leading telecom operator to provide made with Kokilaben Dhirubhai
lending to better-rated corporates. digital payment options, it said. Ambani Hospital.

6 | 2021 | JUNE | BANKING FINANCE