AllBank to restructure loan portfolio
After scripting a turnaround in March quarter of the previous fiscal, Kolkata-headquartered public sector lender Allahabad Bank (AllBank) is working on re-balancing its loan book by bringing down its exposure to corporate lending. At present, the lender’s exposure to corporate lending stands at 65 per cent and the bank is keen on bringing it down to 50 per cent for risk mitigation, said Allahabad Bank’s MD & CEO Usha Ananthasubramanian.

Allahabad Bank, which had posted a loss of Rs 581 crore in the March ending of 2015-16, on Wednesday reported a net profit of Rs 111 crore in the corresponding period of the last fiscal.
“There is a shift happening (in loan portfolio). We have a heavy corporate book. We want to re-balance the loan book. The loan book break-up is 65:35 (65 percent corporate and 35 per cent retail), so we want to improve it to 50:50,” said Ananthasubramanian, adding, “We will be very selective in corporate loan sector-wise, rating-wise and at what form of guarantee will come.”
On big-ticket corporate lending, she said, “We will be choosy in those loans in terms of geography, sector and rating. In certain sector, we may be breaching the cap, so we cannot go on and increase our exposure there. Maybe, there are some sectors, where we have not much exposure, but we are doing well, there we want to grow lending.” She, however, did not specify the timeline by when rebalancing would be achieved.
She said the bank will focus on aggressive recoveries of NPAs (non-performing assets), re-balancing of loan books from high risk corporate book to diversified book. Its gross NPA stood at 13.9 per cent and net NPA 8.92 per cent as on March 31, 2017.
The bank’s capital adequacy ratio stood at 11.45 per cent as on March 31, 2017 as per Basel III norms and the MD said that the lender could require Rs 2000 crore of capital infusion in the current fiscal.