The bank lost its autonomy status after its net NPA jumped to 13.47 per cent of all loans in the last fiscal from 7.67 per cent in the financial year 1998-99. The Reserve Bank of India (RBI) grants autonomy status to public sector banks having net NPA of below nine per cent and a profitability track record of at least three years.

"We have constituted a board level NPA recovery committee at the central office and sub-committees at lower levels to monitor the movement of loans," Joshi told India Abroad News Service.

The bank had adopted a three-pronged strategy for recovery of bad and doubtful loans, which included rehabilitating ailing borrowers, a settlement proposal and legal action against defaulters, Joshi said.

In case the first two measures fail, the bank will resort to legal action under the provisions of the Debt Recovery Tribunal (DRT), he added.

At a recent meeting between public sector bank chiefs and finance minister Yashwant Sinha, it was decided that loans of over Rs 100 million would be personally monitored by the bank chairmen and the action taken would be relayed to the Finance Minister.

Established in 1938, Dena Bank was nationalised in 1969. The bank with a strong retail franchise of 1,170 branches has a strong presence in states such as Gujarat and Maharashtra and Madhya Pradesh. "We want to reduce dependence on high-cost deposits and increase the share of low-cost savings by introducing attractive deposit schemes for the customers," Joshi said.

In fiscal 1999-2000, the bank's share of low-cost deposits grew to 38.8 per cent of all deposits from 36 per cent in the previous year. Joshi said the bank plans to increase it to 39.5 per cent by the end of this fiscal.

Joshi became Dena Bank chief last month after completing a three-year stint at Indian Bank. The bank would soon start its new Internet system to boost its efficiency in client-servicing, asset-liability management, internal communications and security functions.

Joshi said computerised branches accounted for 65 per cent of the bank's business which would be increased to 75 per cent in fiscal 2000.

The bank has 47 multi-branch banking facilities and 10 automatic teller machines (ATMs). A further 25 ATMs are likely to be opened this fiscal.

Joshi said RBI guidelines prevented the bank from setting up an insurance company, but added that it would distribute insurance products to other companies. The bank plans to launch innovative financial products such as securitisation of land rentals, housing loans and flexible deposit schemes for retail customers.

-- (IANS)