Clerical cadre prone to higher attrition

Mangalore/Coimbatore, August 26: Banks put out impressive recruitment figures in their annual reports. But have you ever thought about the attrition rate in these banks? Shocking but true, in some cases, almost half of those who joined had left within a year.

The clerical cadre has been witnessing high attrition, especially in banks with a regional focus. Bank unions say the attrition rate is nearly 30 per cent in both the officer and clerical cadres.

D N Prakash, President of Corporation Bank Officers’ Organisation, said that the attrition level in the clerical cadre was as high as 45 per cent in a bank at one point of time.

Ask for the reasons, and you get several of them.

According to Prakash, some banks have branches only in particular geographical locations, unlike big public sector banks such as State Bank that have branches across the country. Some of the South-based banks have less presence in the northern region, but most of the new recruits in these banks are from the North. The banks find it difficult to place the new employees in States of their choice. This is one of the reasons why most of them don’t stick on for more than a year.

P R Karanth, Joint Secretary of AIBEA, says that someone who joins bank ‘A’ in the clerical cadre usually gets a good offer from bank ‘B’ in the officer cadre after two-three years. Even if the banks impose any bond during their appointment, they are ready to pay and leave.

To address this, K S Bhat, Secretary of the Syndicate Bank Staff Association, said that weightage should be given to those who work in bank ‘A’ while filling vacancies in the officer cadre.

He said a person from clerical cadre had passed IBPS with 167 marks in his bank. But the cut-off for officers’ cadre was 168 marks. But he got an officers job in bank ‘B’, where he matched the cut-off marks.

Some relaxation for the existing staff would have helped his bank to retain him. “In this process, we lost a clerical staffer and a person with two years’ experience,” he said.

Bhat said that in some States a lower division clerk in a government office gets a better salary than a bank clerk. Compared to banks, the workload and risks in some government offices are lower.

20% rise in fake notes in a year, says RBI

Mumbai, August 26: Fake notes are rising at an alarming rate. According to the RBI, the number of counterfeit notes detected in India jumped by 20% in the period between 2010-11 (435,607) and 2011-12 (521,155).
Total banknotes in circulation grew by 7% during the same period. But along with the problem, countermeasures have also increased. “Increased awareness among individuals and more note sorting machines in banks have led to detection of more fake notes,” said a senior Reserve Bank of India (RBI) official. Of the total counterfeits detected, 93% were in bank branches.
The number of note sorting machines, capable of detecting counterfeits, jumped from 4,000 at the end of April 2011 to 10,394 at the end of December 2011. RBI has advised banks to ensure that all notes received by them are processed on such machines before being re-issued.
Companies, too, are working on machines that will detect fake notes and the NCR Corporation is testing Bunch Note Accepting machines that function like ATMs, but have additional features of accepting cash from individuals and detecting counterfeits.

SBI management mulling working Sundays to improve efficiency

Mumbai: Country's largest lender State Bank of India may have its branches open on Sundays to help improve efficiency, a top bank official has said.
"Possibly we would like to see Sunday working which would increase the time available for doing banking and increase the business," bank chairman Pratip Chaudhuri told analysts on a conference call organised by the brokerage Edelweiss Securities.
The bank had last year taken everybody by surprise by opting to keep all its branches open on October 2 to compensate for a day's business loss due to a technical snag.
The bank management was happy with the foot falls and the staff turnout at the branches at that time in spite of it being a Sunday as well as a national holiday - Gandhi Jayanti.
Notably, many private banks, which control only a minority share in the banking operations, do keep their select branches open on Sundays for customer convenience, even though technologies like internet banking have reduced the need.
Being open on Sundays is said to help the branches attract the new-age working class customers where both the spouses in a household work and struggle to do banking transactions during the week.
SBI, which has almost 14,000 branches across the country, counts on its large chunk of savings account deposits (at over 38 percent) for higher margins.
However, if such a move were to be made, it would be interesting how the bank unions, which had crippled banking operations across country last week protesting reform measures, take to such a proposal.
SBI had carried out widely appreciated 'Parivartan' programme in early part of this decade, which helped it stay relevant in changing times and maintaining lead in the market.
During the call, Chaudhuri said the costs incurred on developing physical infrastructure and network does not hit the bank as much as staff costs.
In order to improve efficiency, it will therefore try to delegate routine responsibilities currently done by officers to the low cost junior employees, he said.

Rs 4,000-cr capital infusion on cards: SBI chief

State Bank of India expects Rs 4,000 crore capital infusion from the Union Government this fiscal. The bank will be discussing the matter with the Government this week, said Pratip Chaudhuri, Chairman, SBI.
The bank had earlier this year received close to Rs 8,000 crore from the Government.
“They (the Government) have called us for a meeting which should happen this week, and possibly another Rs 4,000 crore looks to be on the horizon,” he said.
As on June 30, 2012, the bank’s capital adequacy ratio stood at 13.17 per cent.
Non-performing assets
According to Chaudhuri, NPA (non-performing asset) concerns were slightly overplayed. “We should not see ghosts in NPAs,” he said, and added SBI has already taken several measures to bring down its NPAs.
“We are asking companies having non-core assets to sell them and bring the cash. If the company is short of capital, we are asking them to get some private equity or get equity investors, and if the company is asset free and cash poor, we are positioning more loans,” he said.
Recently, SBI appointed 20 credit appraisal experts from leading public sector companies to deal with the technical aspects of its new projects.

ICICI Bank launches 25 e-branches

Mumbai, August 23: Private sector lender ICICI Bank announced the launch of 25 electronic branches and other technology-based banking solutions here on Thursday. The 24x7 electronic branching facilities will offer cash and cheque deposit machines with instant credit, interactive kiosks with phone and internet banking services and video conferencing among others. The investment and cost-benefit-accruals relating to the initiative were not disclosed.
Other initiatives include ‘tab banking’ that allows opening an account on a tablet without visiting the bank branch and e-locker facility that helps customers to electronically save scanned copies of their important documents and other value-added services at the ATMs. Charges on the e-locker services will be decided on the basis of the usage of the customers.
At present, the 25 branches have been rolled out across 18 locations including metros and Tier II cities. “About a third of our customers are using Internet banking services....These services will be complimentary to our physical branches,” said MD and CEO, Chanda Kochhar, ICICI Bank. “Today, handheld devices like mobile phones and tablet segment is growing at over 100 per cent every year as compared to the 20 per cent growth in desktops. We want to expand our technology beyond ATMs and desktop devices,” Kochhar said.

SBI chief wants NPA rules tweaked

Kolkata, August 23: State Bank of India (SBI) chairman has called for a change in non-performing assets’ (NPAs) norms. “There is a need to change the norms relating to NPAs. We should not see a ghost in everything,” said Pratip Chaudhuri.
“For instance, a company has taken a two-year loan to install a machinery. If it fails to repay in two years, just because the repayment has been stretched beyond its original schedule, we should not consider it as an NPA. Nowhere in the world such a yardstick is applied. We need to see if the machinery equipment is sound and capable of generating good output.” The bank chief made these comments to reporters on the sidelines of a banking seminar organised by the Federation of Indian Chambers of Commerce and Industry.
The country’s largest commercial bank saw a surge in bad loans in the first three months of this financial year. The bank added close to Rs 7,500 crore of bad loans on a gross basis during the quarter, prompting investors to sell its shares. Its gross NPA ratio was at 4.99 per cent, while net NPA ratio was at 2.22 per cent at the end of June 2012.
Chaudhuri also said concerns over SBI’s credit quality was “largely overplayed” and the bank will see an improvement in the health of its assets from the July-September quarter. “Our quarterly profit was more than most public sector enterprises’ but our stock got a huge battering because of our NPA. We have done an analysis of the situation. NPAs are largely in the mid-corporate and SME sectors. But with a little consideration, a little understanding and stretching the repayment period, most of these accounts can be upgraded,” Chaudhuri said.
The chairman of the banking behemoth said there would soon be an improvement in the NPA numbers. “We accept the reality, but still, I think, NPA concerns are largely overplayed. In the next two to three quarters, our NPA management will be much better. Current trends do not indicate any increase in our NPAs. In fact, there could be a contraction in our NPAs in this quarter,” he added.
The bank has asked some of its borrowers to sell non-core assets to improve cash flow. If a company is short of capital, SBI is ensuring that the firm takes steps to strengthen its capital base. “If the company is asset-rich but cash-poor, we are positioning more loans to them,” said Chaudhuri. SBI has also appointed 20 senior executives from various public sector enterprises to review the technical aspects of industrial projects before sanctioning fresh loans against them.

SBI, BoI allowed to operate in Pak

India and Pakistan have agreed to allow two banks each from both the countries to set up branches across the border, Governor of the State Bank of Pakistan, Yaseen Anwar said on Wednesday.
“We have held discussions with the Reserve Bank of India and both sides have agreed to issue a full banking licence to two banks of each country,” Anwar told PTI on the sidelines of a conference organised by Institute of South Asian Studies.
The two Indian banks that will be allowed to operate in Pakistan are State Bank of India (SBI) and Bank of India (BoI). On the other hand, quasi-state owned National Bank of Pakistan and privately-owned United Bank Ltd will be running full-banking operations across the border, once licensed by India. “It will take few months to approve Indian banks’ licences on receiving them,” he said. “We are ready to go tomorrow to India” to set up banking operations, Anwar said.
Discussions have been held with RBI Governor D Subbarao to issue banking licences, he said, adding that the process will help normalise trade relations between India and Pakistan. Officials from the Bank of India in Singapore recently visited Karachi for setting up an office in Pakistan, said Syed Hasan Javed, Pakistan High Commissioner to Singapore.