DBS Bank plans expansion riding on Lakshmi Vilas Bank's core strength

DBS Bank India (DBIL), the wholly-owned subsidiary of DBS Bank of Singapore, is now all set to conquer new territories after the successful acquisition of Lakshmi Vilas Bank (LVB) last week. DBIL is now planning to consolidate its retail lending in order to acquire new customers riding on the core strengths of LVB which comprises retail customers and small businesses.

Focus on Customers

In the months to come, DBS Bank India’s loan book will see changes. Corporate lending, which once stood at 75% of the total lending operations will be slashed to 55%, while the lending to Small and Medium Enterprises (SMEs) would be a little under 25%. The balance will be utilized for consumer banking operations comprising gold loans, consumer loans against property, mortgages, and unsecured personal loans.

In the domain of consumer banking, DBIL already had mortgage loans of its own to offer, and now after merging with LVB, it is starting the latter’s secured small business lending via LVB’s branches. These loans will be made available to both individuals as well as business firms (proprietorship and partnership) against property that could be self-occupied or commercial in nature. DBS Bank India has also revived LVB’s gold loan business and it will continue to be one of the key growth areas of the bank.

DBS Bank India also has plans to collaborate with Bajaj Finance by the end of 2021 to launch a co-branded credit card. Post-this, it also has plans of launching its own proprietary credit card service that will serve its customer base of 3.2 million.

Expansion plans

Prior to merging with LVB, DBS Bank India offered SME banking to clients spread across 25 cities. Now, with LVB’s extensive network, the bank plans to expand SME banking to over 100 cities across India over the next 4 months. Surojit Shome, DBS Bank India’s MD and CEO said that the plan is to expand it further to 200 cities and towns, pan India.

Shome said that the bank plans on growing across a wide spectrum of products, both in terms of liabilities and assets, through consumer and SME banking. The exact combination will depend on the product line and the target market.

The consolidation, collaborations and product launches will propel DBS Bank India into a new space altogether and in the coming years, it would be in a position to compete with some of the big players of India’s private sector retail banking.