Financial Daily from THE HINDU group of publications
Wednesday, Jan 16, 2002
Financial Daily from THE HINDU group of publications Wednesday, Jan 16, 2002 |
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Money & Banking
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Housing Finance SBI mulls revival plan for home finance arm Our Bureau
KOLKATA, Jan. 15 STATE Bank of India is considering to prepare a revival package for its ailing subsidiary, SBI Home Finance Ltd, but a final decision on this matter will be taken in the beginning of the next financial year, 2002-03. This was stated by Mr Janki Ballabh, Chairman, SBI, in an interface with newspersons here. He was in the city to attend the Bank Economists' Conference, 2001 (Becon), and made a presentation on `Employee productivity'. Mr Ballabh said that there were lots of apprehensions on the future of SBI Home Finance because of reports in some sections of the media, which talked of the company's closure. ``However, let me clarify that we have not yet taken any decision on this subject," he said. According to him, SBI was considering to prepare a revival package for SBI Home Finance. He, however, refused to comment whether SBI would infuse fresh funds into the ailing subsidiary. A final decision on this subject would be taken in the beginning of the next financial year, he added. In the next couple of weeks, the bank was expecting the Finance Ministry's approval for its proposed technological subsidiary. This company is supposed to help SBI and its subsidiaries in the networking of ATMs, Internet banking for both individuals and corporate houses and also in e-broking activities. Not willing to comment on SBI's likely investment in this technological subsidiary, he said the bank would make approximately Rs 600-crore worth of investments towards technological upgradation in the next two to three years. The bank would also increase its exposure in the stock markets, Mr Ballabh said. Currently, its investments in equity scrips were a fraction of its total asset base. The Reserve Bank of India allowed up to five-per cent exposure. "As per the RBI guidelines we will slowly increase our exposure, but we will invest only in select good stocks. The capital market needs long-term funds and I feel that State Bank can play a vital role in the resurgence of the capital markets", he said.
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