Wednesday, October 31, 2007

Axis of faith?


UTI Bank has come a long way since 2001, but has to counter the new challenges

In theAxis of faith? month of January 2008, UTI Bank is slated to change its name to Axis Bank, and in the process break away from a legacy of triumphs as well as tragedies. The board felt that the existence of several shareholder-unrelated entities using the UTI brand was leading to a brand confusion, which led them to take this decision.

While the branding legacy will be lost, the bank itself has found its way quite well, especially after it was written off due to the US-64 scam in 2001. With deposits of Rs.580 billion and over 5.9 million accounts by the end of March 2007, the bank has come a long way from its humble beginnings in December 1993, when its deposits stood at Rs.1.15 billion. The stride forward has been truly remarkable. Within a few years of operations, the bank went public in September 1998 with a Rs.710 million public issue, which was eventually oversubscribed by 1.2 times.

Commenting “...the bank increased its reach to 332 cities, towns and villages across the country...on the bank’s achievements, CMD Dr. P. J. Nayak stated, “At the end of March 2007, the bank increased its reach to 332 cities, towns & villages across the country through 508 branches & extension counters and 2,341 ATMs.” The bourses are ecstatic as well. The share price was trading at Rs.559.35 and market capitalization was worth Rs.162.85 billion (as on June 1, 2007). The results have been overwhelming; the bank has registered net profits of Rs.6.6 billion for 2007, a massive surge of 38.5% over last year’s profits.

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Source :
IIPM Editorial, 2007

IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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