The Turn around story

Challenges faced

3 years back

UCO BANK

KEY CHALLENGES 1. BUSSINESS MODEL

Over dependence of bulk biz (driven by HO) leading to concentration of risks

Branches out of radar & reckoning

2. LOW CASA BASEVery little thrust on branching out in centres with potential

Lack of urgency in customer acquisition

Unattractive branch ambience

Defective products / processes

Inadequate customer service

3.SLOW TECHNOLOGY ADOPTIONCBS implementation in Mar’10

Serious lack of technology skill sets

Little attention to innovative use of technology for (i) improving biz processes (ii)

product developments (iii) brand building (iv) MIS, control & supervision

4.ASSET QUALITY Deteriorating & lot of unreported/ undetected NPAs

Ill-equipped risk management

Highly inadequate credit monitoring

5.HUMAN RESOURCEAging workforce

Not attuned to IT-based bankingLacking in customer handling skills, product knowledge

UCO BANK

UCO BANK 4

ucoucoucouco bankbankbankbank

THE TURN-ROUND STRATEGY

7. STRICT DUE DILIGENCE BEFORE ASSET SELECTION

1. RESTRUCTURE THE ORGANIZAION

2. OVERHAUL THE BUSINESS MODEL

3. OPEN MORE & MORE BRANCHES AT POTENTIAL CENTRES

4. PUT MAXIMUM FOCUS ON CUSTOMER ACQUISITION

5. STRENGTHEN & ENCOURAGE USE OF ADCs

6. LEVERAGE TECHNOLOGY TO THE HILT

9. BUILD A WELL-TRAINED, ENLIGHTENED HUMAN RESOURCE WITH MODERN OUTLOOK

8. GO ALL OUT FOR RECOVERY OF DUES

UCO BANK

INTRODUCTION OF FOUR-TIER STRUCTURE

CIRCLE OFFICE

ZONAL OFFICE

BRANCH OFFICE

HEAD OFFICE

UCO BANK

CHANGING THE BUSINESS MODEL Bank embarked upon changing the mix of both its assets and

liabilities. Business model shifted from BULK to RETAIL.

Bank shed its volatile and costly bulk deposits and focused on stable

& low-cost deposits.

Now, biz being originated & driven by BRANCHES in place of HO.

For assets, retail customers, agriculture sector, micro, small and

medium enterprises, Bank has chosen to focus on.

Bank is putting thrust on fee-based income like remittances, govt biz.

,LC bills discounting, etc.

236360

296210317130

338670

553740

600960

200000

250000

300000

350000

400000

450000

500000

550000

600000

650000

CASA Mobilisation(Rs. mio.)

UCO BANK

REORGANIZING THE LIABILITIES

Bank is shedding its volatile and costly bulk deposits.

The percentage of Bulk Deposit plus CD which stood at

40.24% of total deposits as on 31st Oct’2012 reduced to

25.20% as on 31st Oct’2013.

By acquiring more and more retail customers every day,

Bank is boosting its core deposits - from 59.76% as on 31st

Oct’2012 to 74.80% as on 31st Oct’2013 - and building a

stable low-cost fund base.

Towards this end, the Bank is increasing its CASA

deposits(from 27.27% as on 31st Oct’2012 to 34.26% as on

31st Oct’2013 ) among other things.

UCO BANK

RE-VITALIZING BRANCHES

1719 1729 17381758

1774 1779 1790 1791 1796 1793 1802 1803 1802 17941765

1712 1706 1709 1717 17271744

1853

1961

2068

2152

2206

2390

2610

2680

1500

1700

1900

2100

2300

2500

2700 Additions Dec1985 to Mar2010 Additions Apr2010 to Sep2013

433 528

Superior customer experience through

�visible & conveniently located branches

�improved branch layout and ambience

�smart & pro-active customer relationship management.

CUSTOMER ACQUISITION (millions)

Customer Acquisition in million (Approx.)

UCO BANK

5

66 77 91

156

301

410

477

607

864

1361

1768

ATM INSTALLATIONS OVER THE YEARS

Installed up to Mar’10 Additions Apr2010 to Sep2013

477 1291

Bank has now more than 34.50 lacs Debit Card user base – an increase of almost 3.5 times in three years – which is increasing rapidly.

UCO BANK

LEVERAGING TECHNOLOGY

The Bank was rather late in technology-adoption and became

100% CBS-enabled in Feb’2011. But thereafter it made rapid

strides in leveraging technology to ensure customer convenience

and improve organizational efficiency.

Some of Bank’s IT initiatives in recent times include introduction of

3rd party Fund Transfer, Payment of Utility Bills, Payment of Direct Tax etc. through ATMs online payment of Income Tax & Customs Duty e-Payment of State Govt. taxes in several statesInterbank Mobile Payment System (IMPS)PPF deposits at any authorized branch anywhere in India Opening of FDR through e-banking channel Online filing of loan applications for selected retail products Biometric Authentication after integrating with Finacle

UCO BANK

LEVERAGING TECHNOLOGY (contd.)

Furthermore, Bank is utilizing technology in various other

areas like using

Bank’s state-of-the-art in-house multi-point video conferencing facility

for performance review, exchange of views and internal marketing

IT in areas like

MIS,

Financial inclusion,

loan processing (LAPS),

treasury operations,

risk management,

back office operations,

monitoring of branch and zonal offices,

personnel functions like on-line submission of PAR,

imparting off-site trainings,

e-learning for UCOites through employee-only access Web site

preparing case studies from records of branch functioning, etc.

UCO BANK

ENSURING ASSET QUALITY

In corporate lending, Bank is focusing only on highly rated

corporates.

In Sep, 2012, our large corporate credit constituted almost

about 56% of our total portfolio. In Sep,2013 it came down to

about 47%.

Side by side, the Credit Monitoring department of the Bank

has been tasked to vigorously control and monitor the health

of the loan assets and put out early warning signals wherever

warranted.

Bank also strengthened its Risk Management practices by

adopting latest Risk Management techniques.

UCO BANK

OFFICERS : CHANGING PROFILE

0.00

10.00

20.00

30.00

40.00

50.00

60.00

7.67 7.28

11.16

23.40

29.35

61.14

47.79

40.88

29.72

25.51

% o

f To

tal

Off

ice

rs

<= 30 years >30 years to 45 years > 45 years to 55 years

Officers 31-Mar-10 31-Mar-11 31-Mar-12 31-Mar-13 30-Sep-13

<= 30 year 675 602 1011 2532 3513

>30 years to 45 years 780 909 1038 1485 1777

> 45 years to 55 years 5379 3954 3703 3216 3053

>55 years 1964 2809 3307 3588 3627

8798 8274 9059 10821 11970

UCO BANK