Central Bank of India set to expand its foreign presence

Central Bank of India the public – sector lender is set to expand its foreign presence, although global banking industry is feeling the pinch of the global credit crunch. The bank has applied with the Reserve Bank of India (RBI) to seek permission for the opening up of representative offices in five locations - Singapore, Dubai, Doha, London and Hong Kong.

Due to Sethia scam in the 1970s bank had closed down its London office; however this is the first time the bank is undertaking an independent overseas foray. At that time RBI asked the other two banks, who had operations in London, to close down.

Currently, Central Bank of India is having one overseas office, in a joint venture with Bank of India, Bank of Baroda and government of Zambia. In this joint venture the Zambian government has 40 per cent stake and the banks’ have 20 per cent each.

“We are awaiting RBI’s approval to expand our business overseas. We would like to open there by the end of this financial year,” said Central Bank Chairperson and Managing Director H A Daruwalla.

Bank’s plan to open overseas branches is in line with its plan to attract export-import businesses and NRE and FCNR deposits from abroad. As the value of rupee is decreasing to an unprecedented level, banks are struggling to get hold of trade-related business and remittance income from NRI deposits.

In the meantime, the bank has started a level-jumping exercise by promoting 2,000 clerical-level officials to the probationary officers’ cadre. The bank has also promoted some scale-II and III employees directly to scale-IV and V respectively.

Central Bank will also be recruiting 1,000 clerks by the end of March 2009. While on the technology front, the bank has allocated Rs 125-150 crore to implement core banking services (CBS) platform to 1,070 branches by the end of March 2009.

“Our aim is to become 100 per cent CBS compliant by March 2010,” Daruwalla added. At present bank is having over 700 branches under the CBS platform.