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Oriental Bank of Commerce, nationalized in the second round in the year 1980, has been performing remarkably well during recent times. It has a very low level of NPAs, high staff productivity and substantial capital base. It has been concentrating on expansion of retail credit of late.
Oriental Bank of Commerce has been nationalized in the second round of nationalization during 1980 along with five other banks including Corporation Bank and Andhra Bank. These three banks though not belonging to the league of big five, have distinguished themselves on the basis of strong performance during the past five years.
Oriental Bank of Commerce established in 1943, has its headquarters at New Delhi. It has a compact size of branches, 967 in number. This article examines the strength of Oriental Bank of Commerce in areas like capital base, profitability, NPAs, staff productivity, strategic initiatives, degree of automation etc.
The capital base has increased substantially from Rs. 943 cr (March 1997) to Rs. 1,620 cr (March 2002). The ratio of capital and reserves to working funds stands over 5% as on March 31, 2002. This bank has received recapitalization funds amounting to only Rs. 127 cr. LIC has invested 11% capital in this bank as a part of its strategic investment in banks. Corporation Bank is the only other bank which got investment from LIC at a higher level of 27% of equity. However, Oriental Bank of Commerce doesn't have any strategic alliance with LIC for opening of branches / extension counters; ATMs in LIC are for specially tapping business from LIC.
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