``We have set a target of Rs 4,000 net advances for the current fiscal year. Of this, about Rs 2,000 crore would be for trade finance,'' Union Bank of India chairman and managing director AT Pannir Selvam told PTI.

This would be a steep climb for the bank's lending graph which had averaged between Rs 1,000-1,500 crore in the past few years, and would raise the bank's net outstanding advances from Rs 12,000 crore (as on March 31, 1999) to Rs 16,000 crore, he said.

``Our strategy is two double business every three years. We will achieve this between 1996 and 2000,'' Selvam added. Union Bank commenced trade financing only in the second half of fiscal 1998-99 and ithas already become the fastest growing business of the bank, he said.

``Trade financing has become our fastest growing operation and will be the engine of growth for our proposed business expansion during the running fiscal,'' he said.

UBI's trade financing volumes grew to Rs 600 crore in the January-March 1999 period.

The bank extends credit to both wholesale and retail traders at a flat interest rate of 16 per cent on an ongoing basis, selvam said adding that the loans are 100 per cent collateralised.

On the bank's plans for the financing of brand franchising, Selvam said ``We will support brand franchising in a big way. We are working on the details of this new business.''

Other areas the bank would lend include petroleum products, power, bridges and housing, he added.

However, credit offtake in the infrastructure sector has been sluggish over the past year owing to the general economic slowdown, he said adding that despite loans being sanctioned the actual disbursements stayed low.

In thelast financial year, UBI's total business mix (deposits plus advances) amounted to Rs 40,000 crore and the credit deposit ratio was 30:70.

Selvam said the total business mix in the current financial year was expected to go up to Rs 50,000 crore.

With the net advances for the year slated at Rs 16,000 crore, the credit deposit ratio for the current year was expected to be at 32:68,signalling improved utilisation of funds, he added.