IDBI Bank's changing approaches

It has dawned at last, albeit bit in its final stages! The Rs. 478. 80 crore profits IDBI Bank Ltd., a new- generation private financial institution, has finally included department expansion as the primary for its long term growth. Says Mr. Gunit Chadha, the bank's new managing representative and chief executive officer, " Department expansion to boost our reach is the nook stone of our new business technique. " Mister. Chadha overtook the reins at IDBI Bank a couple of months ago, after spending 16 years with Citibank. He now wants to boost IDBI Bank's branch network to 110 by the end of next money. Presently your bank has forty five branches. His immediate goal is to add 10 more branches by the end of this fiscal. Though it had been initially thought that all the entrance of new exclusive sector banks would spell the end of brick and mortar bank, it has become more and more evident which the presence of any physical part in main localities is quite important for progress. IDBI Bank's decision to expand their reach comes not a time too late as its peer, ICICI Bank, has recently taken a fantastic lead on this factor and is quickly expanding their tentacles. These already provides a network of 103 twigs, 25 extension counters and 321-off and site ATM's. The off-site ATM can be an innovative concept of ICICI Bank to capture cost savings bank accounts -- which are far cheaper than other accounts- in bulk. Compared to this, IDBI Bank's brick and mortar system pales into insignificance. But part of the basis for that may be attributed to its concentrate on corporate financial, while ICICI Bank went all out as a major inside the retail portion as well. Talking about the economics of purchasing a physical branch Mr. Chadha hopes to recover the investment in 12-18 month period. While the per customer repairing cost might be higher in case of a physical branch, the cost of acquisition of a customer is cheaper than any other forms. Once again, to keep pace with the sector trend and drive down deal costs, IDBI...