A preliminary feasibility survey has been conducted by global consulting firm Deloitte & Touche and the bank will initiate further steps, taking cues from the findings of report.
M Narendra, CMD, IOB, said, The bank has identified 14 locations in places such as the US, Australia, New Zealand and some African countries. Based on Deloitte & Touches report, we will do our own survey and subsequently seek permission from the RBI and the countries concerned. The bank has six overseas branches at present two in China and one each in Singapore, Sri Lanka, South Korea and Thailand.
The overseas expansion plan would be implemented in three phases Wave 1 for which the survey has been conducted and would be taken up for implementation immediately, Wave 2 for implementation in medium term of around 12 to 18 months from the beginning of the project and Wave 3, which would be considered after three years.
Narendra said Wave 1 includes setting up of around six branches including two in US, one in Australia, one in New Zealand and two in Africa. It expects the Wave 1 to be ready for implementation in an years time. This is a medium and long-term expansion plan for us, he said.
The bank is looking at catering to ethnic Indian community in these countries. It also has to consider the laws in the region to finalise whether the branch should be started as a representative office and operate for some years before making it a full fledged branch. In some countries like China, we have to operate for a few years as representative office before applying to make it a full fledged branch, he said.
Narendra hopes that the bank will be able to get R1,200 crore to R1,400 crore for this year from Centre, as part of the public sector banks recapitalisation programme. The $500 million medium term notes (MTN) raised recently from the overseas market has been deployed fully. The second tranche of $500 million MTN issue will be taken up once the global financial slowdown is over, he said.