Edited by: Namit Singh Sengar
Last updated time: 06 March 2023, 17:42 IST
Currently, the mid-market segment is part of the large corporate group, which includes companies in the Rs 500-6000 range.
A new vertical will be created from April 1, 2023, and a large corporate team will cater to clients with an income between Rs 1500-6000.
Kotak Mahindra Bank is all set to create its own vertical for mid-market companies with turnover between Rs 500-1500 crore to focus on the segment.
The private sector lender also wants to focus on high-margin structured financing, the news agency reported. PTI About this with reference to a senior official of the bank.
Currently, the mid-market segment is part of the large corporate group, which includes companies in the Rs 500-6000 range.
A new vertical will be created from April 1, 2023, and a large corporate team will cater to clients with an income between Rs 1500-6000.
“Our large corporate growth is relatively favorable compared to the growth of SMEs (sub-Rs 500 crore revenue companies) and this is one of the reasons for the change. The opportunity in the mid-market is huge and we are confident that we are tapping into this segment,” said Paritosh Kashyap, president and head of wholesale banking. PTI.
The private sector lender serves the mid-market opportunity from about 15 allocated locations, Kashyap said, adding that the small and medium enterprise (SME) segment is served at 50 locations and much less for large corporates.
Kashyap said the bank had a mid-market group about four years ago and said the recent restructuring was driven by the need to focus more on the segment and grow it faster than it had been growing in the past. business organization.
It will bring together a team of mostly in-house staff from those businesses and shift them to the newly formed mid-market vertical, Kashyap said, adding that some talent will also be hired from outside.
The bank is also focusing on structured finance offerings, whose share of the total wholesale book is currently in the low single digits and growing equally, Kashyap said.
“Typically these are non-standard financing requirements with relatively good collateral and high margins. Our exposure is currently in the low single digits. We want to grow this book,” he said.
Kotak Mahindra Bank does not shy away from any sector, Kashyap said, adding that previously troubled segments such as non-bank lenders, infrastructure companies and real estate players are now doing well.
Kashyap is confident of higher credit growth in FY24 due to multiple factors and noted that the government’s Rs 10 crore capital expenditure commitment will also help credit growth.
Currently, 30% of the bank’s wholesale book is tied to external benchmarks, Kashyap said, adding that competition in the big-ticket loan segment is a reality that also affects pricing.
The bank recently announced that it has opened 100 gold loan branches so far in the current financial year. As of March 31, 2022, the bank offers gold loans through its 400 branches.
With the addition of new gold loan branches this financial year, Kotak Mahindra Bank now offers gold loans through 500 branches spread across 253 cities across the country.
The bank plans to open 50 more gold loan branches in this financial year ending March 31, 2023.
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