Ahead of the expected bifurcation of Andhra Pradesh, the commercial banks and the Reserve Bank of India (RBI) are firming up regional presence to consolidate their position.
An immediate case in point is the latest attempt by the public sector entity Syndicate Bank which has carved out its new region at Ongole for better customer service.
Incidentally, Ongole is one of the places which is under active consideration for building of new capital for Seemandhra region in the event of bifurcation. The property prices are already going up in this town and business activity, especially of the real estate is going on briskly in the region. Apparently Syndicate Bank does not want to miss the bus in capturing the emerging business.
“The idea is to firm up our presence out there and garner better business. We are giving independent status to Ongole which will serve as a regional centre. We have been there for several years and it is also a lead bank,” said Mr M. Anjaneya Prasad, Executive Director, Syndicate Bank. This apart, the bank also has plans to set up another regional office at Visakhapatnam in the coming days.
Another State based lender, Andhra Bank is also watching the developments keenly. “We are strong but need to consolidate our position. Owing to irrigation facilities, ports, export of sea foods and two crops, the region is important. It’s natural that banks are increasing focus there,” said a senior official from Andhra Bank. Of the total 14 regional centres in the State, 8 are located in Seemandhra. The number of branches are 900 in Seemandhra as against 600 in Telangana.
The Seemandhra region is of utmost importance for State Bank of Hyderabad but as of now there was no such plan in place to go in for regional bifurcation. “We have regional centres in Visakhapatnam, Vijayawada and Tirupathi and we get 30 percent of business from there. It is the area of potential,” said Mr M. Bhagavantha Rao, CMD, SBH.
The financial regulator RBI is mulling an umbrella model in this regard. The regulator’s Hyderabad centre will continue to be the financial capital for the bifurcated regions according to a highly placed source at RBI. The regions will be brought under the jurisdiction of the RBI at Hyderabad, a regulatory model that is in place in the newly created States – Uttaranchal, Chhattisgarh and Jharkhand according to him.
“It’s an umbrella model. Bhopal has jurisdiction over Madhya Pradesh and Chhattisgarh; Patna has jurisdiction over Bihar and Jharkhand. And, RBI Kanpur has jurisdiction over Uttar Pradesh and Uttarakhand,” he said.
