Corporation bank credit card india

A decade ago when most banks were burdened with bad loans and depreciation losses, Corporation Bank stood out for its asset quality and excellent ratios. However, the Mangalore-based bank's presence has been now slightly overshadowed by the dramatic rise in the presence of new private banks.

Corporation Bank has been viewed as a small but efficient bank. Given the changed environment, do you feel the need to step up scale?

When it comes to scale the thought that comes to mind is cost reduction, but we have achieved that in other ways. More than scale, we value scope as customers are more interested in the service level and product range rather than balance sheet size. The bank has never lost its way and has retained long-term performance against intense competition, that itself calls for a lot of efforts.

But we are also capturing growth opportunities. We expect the share of consumer banking in the industry to expand to 40% from around 25% because of the growth in middle class. We are also able to participate in large-scale projects as the exposure limits for large loans are based on net worth. In the past three years, our business has trebled, while the banking industry has doubled. Earlier, our share in bank branches was 1.23%. Now, our share of new branches opened is 3.83%. We used to add 4-5 lakh customers every year, but in the past year we added eight lakh. This year, it is expected to be more. So, in terms of business, branches and customers, we have put our foot on the accelerator even though we feel scope is more important than scale.

How has your experience been with retail hubs?

We have set up around 20 retail hubs, which distribute 10 products including housing and personal loans. The hubs have helped us in several ways. Firstly, it has speeded up delivery of loans from a month to a week. Second, it has improved customer service in branches by removing a lot of the back-office processes. Third, it has helped improve loan quality by separating marketing and credit appraisal. All this has brought down our delinquency levels from 1.13% in March 2007 to 0.62 in September. We are now planning to move documentation work to the retail hubs, which will improve service in the branch.

Corporation Bank on Thursday said it has entered into agreements with three credit rating agencies - ICRA, D&B and Fitch.

In a filing to the Bombay Stock Exchange, the bank said it signed a Memorandum of Understanding (MoU) with ICRA and Fitch today and with D&B on Wednesday.

Meanwhile in another filing today, ICRA said it has entered into an agreement with Corporation Bank to assign ratings to the bank's loans and other exposures. Be sure to compare credit cards rates to get the best rates on your every purchase.

According to the MoU, ICRA would assign ratings to the bank's loans and its other exposures under the standardised approach of RBI's New Capital Adequacy Framework for Basel-II.

Corporation Bank proposes to open 100 new branches this year, according to its Chairman and Managing Director, B. Sambamurthy.

Talking to presspersons, after film producer D. Rama Naidu inaugurated the 950th branch of the bank at Film Nagar here on Wednesday, Mr. Sambamurthy said the bank had opened 70 new branches in 2007. It had already secured clearance for the proposed 100 branches from the Reserve Bank of India. By May, the bank would take the number of branches and ATM counters to 1,000 each.
Main focus

The expansion would mainly focus on the South-Western and Northern regions where there was enormous potential. The bank had always been posting profits in its bottom line for the last 102 years of its existence.

He said the bank was targeting a business of Rs. 1 lakh crore by next year, while its turnover stood at Rs. 84,000 crore in the current fiscal with a 60:40 credit-deposit ratio.
Invest Shoppe

The Film Nagar branch was the third concept branch, equipped with 'financial health check-up' and Invest Shoppe'. Under this, customers' risk-reward portfolio would be assessed and they would be duly advised and financial products such as insurance, mutual funds, gold coins and the like would be sold under one roof.

Mr. Sambamurthy said the bank would increase the number of 'Invest Shoppe' branches to 12 by March and 40 by the end of the year. As part of the implementation of 'financial inclusion', the bank had 1,200 villages surveyed and would introduce branchless banks with the help of 'business correspondents' and handheld machines in all these villages. At present, branchless banks were established in 15 villages, he said.

source: Hindu

Interest rates in various banks could stabilise in the next two to three months, even as the Centre has started preparing proposals for the financial budget for the next financial year 2007-08.

Replying to a question at a press conference here on Saturday, Corporation Bank Chairman B. Sambamurthy said he did not see the possibility of lending rates going up immediately.

He said the 102-year-old Corporation Bank, the oldest in the country, had made a humble beginning and developed business of Rs. 37 crore in the first 97 years. It doubled the business in the subsequent three years. Also compare credit card rates at corporation bank to get more discounts on your purchase.

Today, the bank's business has crossed the Rs.76,000-crore mark, which is a direct reflection of a vibrant and growing Indian banking system and progressive reforms brought in by Reserve Bank of India. The bank has 945 branches across the country and with a credit-deposit ration of 80 per cent, it has already touched a turnover of Rs.1,000 crore during the current financial year and hopes to touch Rs. 1,500 crore by the end of 2007-08.

What you don't know about credit inquires can destroy your credit score and effect what you can qualify for. Whether you are shopping for a cell phone, car, home loan, insurance, or just curious about wanting to see what you could qualify for, a credit inquiry can cost you points on your credit score. Even a reduction in credit points may seem trivial. A change in credit points over a 30 year period can cost 1000's if not 10,000's of dollars in higher interest payments. Furthermore to some it can mean the difference of being able to qualify for a home, car, or other financing that is necessary in today's world. Usually a credit inquiry will result in a less than a five point reduction in your credit score. However with multiple inquiries comes the likelihood that the score will plummet and the interest rates for purchases will go up. This will result in the consumer with a lower credit score to make higher payments for home, car, of other credit purchases. Corporation bank offers you the low rates credit cards which benefits your's purchase.

There are several different credit inquiries. An inquiry for a specific purchase will have a freezing point for a 2 week period. In other words if you were shopping for a car you could have your credit pulled, (also called an credit report inquiry) at several car lots during a two week period and it would only count as one inquiry. This type of inquiry usually results in less than five point drop in the credit score. This is because the credit bureau considers all the credit inquiries done in the two week period for the same credit purchase to only affect the credit score once.

In order to render comprehensive multifaceted and quality service to its customers, Corporation Bank launched two maiden services "Financial Health Check-up & Invest Shoppe" at Ram Bhavan Complex Branch at Kodialbail in Mangalore today. The Financial Health Check-up was launched by Dr. C.R.Kamath, Director of the Bank and renowned Ophthalmologist. The "Invest Shoppe" was inaugurated by Shri N. Vinay Hegde, Managing Director, Lamina Group of Companies. Shri B. Sambamurthy, Chairman & Managing Director and Shri K.L.Gopalakrishna, Executive Director of the Bank were present on the occasion.

%uF793People work hard to earn money. It's the role of Bankers to see that the money works harder for their customers. Through a unique measure, the Bank is also offering a financial health check-up service in the shoppe to its customers. This value-added service facilitates the customer to get his finance portfolio examined from the point of healthy mix and get advice on risk-reward portfolio sharing. %uF793 said Sambamurthy.

Corporation Bank is in the forefront of providing innovative and Tech Savvy product services to its customers. It%uF792s the first public sector bank in the country to bring all its branches & offices under core banking solutions thus enabling its customers to bank from any of its branches across the country. The Bank offers a bouquet of products & services such as Internet banking, SMS Banking, International Debit Card, International Credit Card and SMS-based Pay-by-Mobile Service, which is first of its kind in the country. The Pay-by-Mobile facility is available to all debit cardholders of the Bank. Through this service a customer can now shop at Internet, do teleshopping and purchase at over 3,000 merchant establishments across categories and interfaces which include airlines, restaurants, retailers etc., through the mobile.

he country's largest financial institution Life Insurance Corporation of India has announced its entry into the credit card business with GE Money and Corporation Bank as equity partners.

GE had earlier partnered the country's largest bank - State Bank of India - in its credit card venture. LIC officials, however, said there was no conflict of interest as the corporation was looking at credit cards largely to serve its own purposes of enabling transactions. Sources said that GE's ability to leverage technology swung the choice in its favour.

LIC, which has a customer base of 22 crore, has unveiled ambitious technology programmes that involve allowing customers to pay their premiums anytime, anywhere. "Unless we use technology extensively, it is not possible to bring down transactions costs," said LIC chairman TS Vijayan.

"This partnership brings excellent management skills, credit card experience and unparalleled distribution networks under one roof and we look forward to working with each other," he added. Through this JV, LIC aims to offer premium-payment facility to policyholders with their own credit card. Not only will this provide added convenience and service to LIC customers, but will also bring down the transaction cost for LIC.

So far, the corporation had not enabled premium paymets through credit cards because of high charges.

In addition to GE Money, LIC has roped in Corporation Bank as its banking partner. The equity in the credit card venture will be held by LIC's two other subsidiaries - LIC Housing Finance and LIC Mutual Fund. The participation of subsidiaries will give the card business access to a much wider customer base. The partners will be investing in the proposed credit card company's equity capital. However, the shareholding structure is yet to be finalised.

On Thursday, the four companies signed an MoU. The parties aim to finalise definitive agreements by October-end. LIC had hired KPMG as advisor. According to Vishal Pandit, CEO of GE Money's India operations, GE would leverage its expertise in consumer finance service to help the partnership become a strong player in credit cards.

Corporation Bank said on Thursday that it has a Memorandum of Understanding (MoU) with the Life Insurance Corporation of India, to create a new credit card company.

Other partners in LIC's credit card company are GE Money India, LIC Housing Finance and LIC Mutual Fund.

LIC's new credit card company would leverage the strengths of each company. The parties aim to finalise the definitive agreements by the end of October.

LIC's main target in its credit card venture will be its large customer base. It has around 200mn policyholders and 90mn unique customers. To start with, the credit cards will be a mode for payment of premiums for LIC's policyholders.

KPMG has been mandated to formulate a business strategy for LIC. The management consultant will also help LIC in starting the credit card venture.

Among the top players in the credit card business are ICICI Bank, Citi, SBI, HDFC Bank, StanChart and HSBC.

Among listed public sector banks, the Corporation Bank stock, at its current price of around Rs 350, provides a good medium-term investment opportunity.

The stock trades at around 1.3 times its March 2007 book value and about 9.3 times its March 2007 earnings. Investors with an investment horizon of at least one year can take exposure at current levels.

Not only will margins in certain segments of the retail business be higher - for example, in credit cards and personal loans - but the overall retail business would also provide more stability to the earnings stream and could offset income variability from other business segments such as corporate/commercial banking.

A host of foreign banks, private sector banks, nationalised players and private equity funds have lined up for the credit card foray of Life Insurance Corporation. Around 17 presentations have been made by different players, including Citi, StanChart, HSBC, Barclays, Discover, ICICI Bank, Centurion Bank, UTI Bank and 3i.

Though the corporation has not yet fixed on how to go ahead with the card foray, it is likely to use the JV route. Corporation Bank of India would also partner LIC in this foray. The bigger players in the system are ICICI Bank, Citi, SBI Card, HDFC Bank, StanChart and HSBC. New players like UTI Bank and Deutsche Bank have also entered the industry recently.LIC's foray is at a time when the profitability of the credit card industry has taken a hit.

To be eligible for Corp Bank International Credit Cards, the applicant should meet the following criteria:
Should be an Indian citizen
Should not be a minor or illiterate person
Have Permanent Account Number (PAN) issued by Income Tax Department. (In absence of PAN number, F.60/F.61 shall be obtained)
Should be a customer of the Bank having any type of account with satisfactory operations in the account for at least 3 months.
Fulfill the Age and Net Income Criteria as under:
Criteria

Type of Card:

Salaried (including salaried Sr. Citizens)
(Income per annum)

Self Empoyed / Professionals (Income per annum)

Senior Citizens (Income per annum)

Income for:
Classic cards

> Rs 60,000
> Rs 75,000
>Rs 60,000

Income for:
Gold cards

> Rs 150,000
> Rs 200,000
> Rs 150,000

Age:
All cards
18 to 65
18 to 65
Upto 70