CHENNAI: Singapore-headquartered multi-national bank DBS plans to diversify its lending portfolio in the country into gold loans, consumer finance and MSME loans, from its strong suit of corporate lending.
The bank targets a three-fold rise in gold loan portfolio from Rs 4,500 crore to Rs 13,500 crore in the next five years. The bank pins its hope on high-demand for gold-backed lending, especially from the agricultural community, attractive interest rates, and low processing fees.
Speaking to the press, Bharath Mani, executive director and head of retail and customer segment of DBS Bank India, said the bank aims to generate 40% of its revenue from retail and MSME loans in next five years, stressing that its focus on high-end corporate and institutional banking will remain same. However, this would bring down the share of revenue from corporate banking to 60% from 70% at present. The amalgamation with Lakshmi Vilas Bank (LVB) brings in scale, size and the ability for DBS to move across from just being a corporate and wealth management and high net-worth bank, he added.
DBS to focus on micro, small and medium industry credit with an average ticket size (loan amount) of Rs 20 lakh to Rs 30 lakh, tapping into potential in the smaller towns. “Now, we want to enter the full spectrum, right from local shopkeepers and local traders, upwards to SMEs, (and) emerging corporates. We will be able to cover the full spectrum of entities,” Mani said.