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IndusInd eyes two finance companies

Mumbai, July 9: IndusInd Bank is looking at the possibility of acquiring non-banking finance companies (NBFCs). The bank has started preliminary negotiations with two NBFCs.

According to Bhaskar Ghose, managing director of IndusInd Bank, the strategy to take over NBFCs is unlike its compatriots who are largely interested in buying out banks. He pointed out that IndusInd is targeting those NBFCs who have a good portfolio and are reasonably spread across the country.

“We are looking at NBFCs who have 30-40 branches with around 150 employees,” he said. The two NBFCs, with whom IndusInd is negotiating, are largely into financing two-wheelers and trucks.

Ghose averred that non-performing assets in two-wheeler financing were extremely low with yields as high as 24 per cent.

When asked about the possibility of the merger with Ashok Leyland Finance, a group company, the managing director said this issue is not of a major concern to the bank. “As and when the owners of Ashok Leyland Finance and IndusInd decide that such a merger will be a good strategy, it will be done relatively easily,” he said.

IndusInd Bank has been growing inorganically through portfolio acquisition in retail assets. The bank is targeting a 50 per cent rise in operating profit this fiscal. It acquired portfolio worth over Rs 750 crore last year.

As part of its retail drive, the bank is planning to open 20 branches this year for which it had obtained licences earlier this month. It has set a target of 100 branches by June 2004.

“Our strategy is not to build 200-300 branches, but have a critical mass. We believe 100 branches will give us representation in major centres,” Ghose said.

As part of its retail initiative, the bank today launched PowerCard, an international debit/ATM card.

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