Banks have to look at Tier II and Tier III cities also - Coimbatore, Ludhiana, Madurai, Lucknow, Kozhikode, Bhopal and Nashik

These many days Banks and other majors have only looked at the metros and other main cities in India for their customer care and all other centers. But, now they will have to look at the tier II and tier III cities as well.

Banks (especially private ones) would have to pay more attention to the high demand for money in tier II and tier III cities in India.

Crisil says that despite the difference in volumes, higher profit margins can make smaller towns as attractive as metro cities.

The report covered 15 tier II cities that included Coimbatore, Ludhiana, Madurai, Lucknow, Bhopal, Nagpur, Nasik, Rajkot among others. These make up for 15 percent of the total retail loan demand in India.

In some of these cities growth prospects are so strong that the car loan demand might grow at 20 percent for the next couple of years against an expected Indian average of 13 percent.

Gold loans are expected to grow at 50 percent rate, mainly driven by smaller towns.

Even HDFC Bank, which disbursed Rs 15,000 crore worth new retail loans in the first quarter this year, saw 50 percent of loans coming from tier II and III locations.

Yes bank, which intends to take its retail portfolio to 10 percent by the year end from the current 1 percent, will also open most branches in tier I and Tier II cities.

Magma targets 50% growth in Tamil Nadu - Growth plan in state for 2012

Magma Fincorp Limited (“Magma”) is a non-deposit taking non-banking finance company (NBFC), registered with the Reserve Bank of India (RBI) as an Asset Finance Company.

Magma has presence in 7 cities Of Tamil Nadu including branch offices in Chennai (2), Madurai, Coimbatore, Salem, Pondichery, Vellore & Trichy and employs about 150 people in the state.

“The primary sales of assets have witnessed robust growth in the past several quarters and we hope the same would continue. This augurs well for our business. With the development of infrastructure further, we hope our products will continue to do well as majority of them cater to the growth in rural and semi urban markets,”, said Bhattacharya.

He said that the company will also focus to grow the higher yield products such as Suvidha, Tractor and SME Loans significantly.

Car, Commercial Vehicle & Construction Equipment finance posted a healthy growth of 158%, 74% & 73% respectively.

The Tractor finance and Suvidha (Refinance) verticals introduced last year also witnessed a phenomenal growth of 1284% & 209% respectively.

Andhra Bank opens second branch in KK Nagar Madurai

Public sector lender Andhra Bank is planning to set up another branch in Madurai.
The new branch would be set up at KK Nagar, Madurai.

Axis Bank opens a new branch in Madurai

The private sector Axis Bank opened its branch at Ilanji at Meenakshi Nagar on the Coutralam-Madurai road on Wednesday.

The Axis Bank had 655 branches, 20 extension counters and 2,778 ATMS across the country besides presence in Singapore, Hong Kong, Shanghai and Dubai. It was also planning to expand further its international presence, he said.

The market capitalization of the bank as on April 15, 2008 was Rs.23,370 crore, he added.

Continuing research on Karur: Industry, Profile and Potential: Nearby District of Madurai

Karur is also famous for two banks, since early twentieth centuries. The reason I am excited about these two banks is - these banks were started with an initial investment with as low as Rs.1,00,000 on those days - say early 19xx's.

I am impressed by the entrepreneural skills, risk taking personalities and at the most - they have started to help the financial side of agricultural and trade needs at those times.

Hats off to all the people behind these banks birth!

Karur Vysya Bank and Lakshmi Vilas Bank, Karur

Karur Vysya Bank

The year was 1916 when two illustrious sons of Karur, the Late Sri M.A. Venkatarama Chettiar and the late Sri Athi Krishna Chettiar came together to found Karur Vysya Bank (KVB) with an initial capital of Rs. 1 lakh with an avowed desire to support the agricultural and trade activities in and around Karur. In the business of providing exemplary financial service for over 90 years, KVB is today the favorite banker to millions of customers around the country, enjoying a premier position in the banking industry.

Business Landmarks as on 30th September, 2007:

* With a deposit base of Rs. 10916.38 cr. and advances figure of Rs. 7438.68 cr., KVB has recorded a total business of Rs. 18355.06 cr.
* The Net Profit earned by the bank during the first half of 2007-08 was Rs. 91.36 cr.
* The Net Owned Funds of the bank has reached a figure of Rs. 1063.16 cr. as on 31.03.2007. In fact, KVB is the first Tamilnadu based Old Private Sector Bank and the third in the country in this category to cross the Rs. 1000 cr. mark in Net Owned Funds. But the special landmark is that the entire amount is clocked under Tier I capital only.
* The Capital Adequacy ratio is at a healthy 15.42% on the increased asset base as against the RBI stipulated norm of 9%.
* With a record of uninterrupted earning of profits and declaration of dividend, KVB has declared 100% dividend consecutively for the past four years. This year, the bank had declared Rights and Bonus shares to its stakeholder and the dividend of 100% declared for 2006-07 is on the enhanced capital base.

Check out Karur Vysya Bank

The Lakshmi Vilas Bank Limited was founded seven decades ago ( in 1926) by seven people of karur. At present, the bank has a network of 236 branches, spread over 11 states and the union territory of Pondicherry.

The Lakshmi Vilas Bank's business crossed Rs. 8,752 crores as on March 31, 2007. The Bank earned a Net profit of Rs. 17.58 crores. The Net owned Funds of the Bank reaches Rs. 396.08 crores. With a fairly good quality of loan assets the Net NPA of the bank was pegged at 1.58 % as on March 31, 2007 down from 4.98% as on March 31, 2005.

Check out Lakshmi Vilas Bank