New Delhi: Indian Overseas Bank (IOB) on Monday said it will rationalise the number of its regional offices by closing 10 such offices to improve efficiency.
"Our Bank at its meeting held in 12.12.2015 decided to rationalise the number of regional offices in the country by reducing 10 regional offices from existing 59. The estimated date of closure is 1.3.2016," the public sector lender said in a clarification to the BSE.
"The closure of regional offices is for optimum utilisation of resources and is administrative decision within the bank... it will result in substantial reduction in administrative costs," it further said.
Indian Overseas Bank said it has 59 regional offices and 7 zonal offices, which provide support and guidance to branches, that are undertaking business activities and are required to monitor the performance pf branches.
IOB said in October last year that the Reserve Bank of India had initiated a prompt corrective action on the bank.
The RBI specified certain regulatory trigger points, as a part of prompt corrective action (PCA) framework, in terms of three parameters - capital to risk weighted assets ratio (CRAR), net NPAs (non-performing assets) and return on assets (RoA) - for initiation of certain structured and discretionary actions in respect of banks hitting such trigger points.
Gross NPAs of the bank rose to 9.40 per cent for the quarter ended June 30. IOB's gross non-performing assets rose to 8.30 per cent at the end of March 31, from 4.84 per cent a year ago, according to provisional RBI data taking into account domestic operations of banks.
At 1:12 p.m., shares in Indian Overseas Bank were trading 0.84 per cent lower at Rs 29.35 apiece on the BSE, whose benchmark Sensex index was down 0.68 per cent.