Corporation Bank wants to be among top 10 Indian banks in couple of years. Ramnath Pradeep, CMD, Corporation Bank in an interview with FE?s Sitanshu Swain & Kumud Das outlines his strategies to expand bank?s operations in both domestic and international markets.

What is your agenda for the Corporation Bank?

We have prepared a five-year long-term plan for the bank. We will be a global bank with a global standard. To make it a global standard, it doesn?t mean that you should have a global benchmarking. But, your services should be of global standard. We have representative offices in Dubai and Hong Kong (HK). Hence, we would like to first convert our offices located at HK and Dubai to full-fledged branches.

I?m exploring opportunities in Brazil and Vietnam. There are lots of Indian companies going to Brazil. No other Indian bank has gone to Brazil so far. Vietnam is also opening and the country has got a co-operative banking regulator.

First, we?ll have to go to the board and thereafter, we will make a survey to take the final call. Vietnam is nearer to China. The cost of operations is cheaper in Vietnam. The labour is also cheap there. There are Indian corporates which are doing business over there. We will also go for a brand building of the bank but don?t have any plans to change its logo which continues to be there since its inception.

How do you plan to improve existing operations?

Term lending comprises 45-46% of the bank?s total loan book. I want to reduce it to 35% by the fiscal-end and expand exposure for the working capital loan as it reduces business risks. Also, I will get other types of business like letter of credit (LC), salary account and other miscellaneous business through it. I am exploring the possibilities of taking over shares of other banks in working capital.

Normally, the repayment period for working capital loan is one year. It?s a kind of balancing act.

At present, retail comprises 18% of our loan book. I want to improve it to 25-26% by the fiscal-end. I will focus on sectors like housing, vehicle, education loan and personal loans. I want to go for more retail and SME customers in a bigger way.

Is it a good strategy to reduce term lending when the other banks are increasing infra funding?

I am not withdrawing from that segment. Infra companies will also need working capital. Infra finance comprises of 16% of the loan book which is spread over to sectors like power, working capital and term loan. We want to become a part of take-out finance scheme soon.

How do you plan to improve RoA and NIM?

Base rate is a benchmark now, below which a bank can?t lend. Our market share right now is at 1.67%. I want to maintain this level and increase it to further level in next five years.

All the big banks are targeting retail business . Do you think small banks can compete with them?

Competition is only there in acquiring new customers. Today, all the banks are having CBS, hence, technology is not an issue. The real differentiation takes place in how one provides service.

Do you plan to expand your branch net work?

We plan to open 200 branches every year until 2014-15. I am concentrating on tier-II and tier-III cities for new branches. I am planning 22-25% growth in the bank?s business during next five years. Currently, we have got 1,177 branches and are a regional player.

Right now, 28% of our branches are in Karnataka, followed by Tamil Nadu (11%), Andhra Pradesh (10%), Maharashtra (10%) and Gujarat (5%).