Central Bank of India (CBI) has indicated that its 4 Cs business strategy has helped improve performance. The Mumbai-headquartered public sector bank (PSB) will pursue the strategy to regain the lost ground in the banking sector.
The 4 Cs approach is all about cost (control and reduction), credit (quality and monitoring), capital (optimisation and preservation) and customer (satisfaction & delight).
“We embarked upon this 4 Cs plan last year and it has given us wonderful results in 2014-15. We have been able to show a decent performance and profit. Stock market has reacted very positively. Regulator also acknowledged it,” B.K.Divakara, Executive Director, Central Bank of India, said here.
“We have, all along, been focusing on corporate credit. So the dependence on corporate credit was as high as 63 per cent a few years ago. But the exposure has been reduced to 49 per cent in 2014-15. So, we started lending more to retail, agriculture and MSME (micro, small and medium enterprises) segments,” he added.
The bank also consciously moved out of short term bulk price-sensitive advances. Because the yield is very. This portfolio also has the volatility issues. On other hand, retail, agriculture and MSME advances are stable.
“Of course, we need to have the right credit mix of corporate and other categories. But, earlier it was unduly dependent on corporates. Our change in focus didn’t affect the net interest margin. It has actually improved in 2014-15,” he added.
When banks were nationalised in 1969, CBI was reported to be on the top among the PSBs. But the bank lost its edge to competition in the subsequent decades. “We are now coming back strongly and hopefully in a couple of years from now we may be able to regain the lost ground. This is our endeavour,” Mr.Divakara added.
