State Bank had earlier this year identified retail finance, along with infrastructure finance, as key areas to sustain growth in the backdrop of a slowing economy. Other areas of retail finance for the bank are also doing better than expected, SBI officials said.

The bank had recently revamped the entire housing loan procedure following major relaxations permitted by the Reserve Bank of India in April, 1998. With the new procedures in place, SBI is now placed on an even keel vis-a-vis housing finance companies.

State Bank has identified 500 branches across the country to specifically push housing loans. Housing loans have been assigned as the core business focus of these branches. Other retailbanking products of the bank are also doing well, though they are still in their initial phase of introduction, the bank official said.

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State Bank plans to increase the share of retail assets to 15 per cent from the present 10 per cent over the next five years. This is meant to be achieved by an increase of 1 per cent every year.

State Bank is heavily banking on the completion of its 100-branch personnel banking network to give the big push to its retail products. The bank is in the process of putting up a network of over hundered new branches exclusively dealing with personal banking products and with a distinct brand identity of a posh new generation bank.

These branches -- meant to counter the growing aggression by foreign and new private sector banks -- will offer only personal banking services and not deal in corporate and business accounts.

SBI plans to use these branches as an outlet for all its personal banking products. The idea is to make an account holder in these branches satisfy allhis personal finance needs at the branch itself. At present, these products include SBI's housing loans, consumer finance scheme, educational loans, car loans, personal loan scheme, depository participant services, advances against shares, debentures and PSU bonds.

SBI has already opened about 15 of these new branches in various metros. By December 1999, the bank hopes to have one hundred of these new generation branches in place. After March 1998 when at least 50 of them are in place, the bank will link each one of them into an information technology network, that will allow for any-time banking.

INSIGHT
HDFC, LIC Housing Finance may lose out to new players

The housing finance market is commanded by just two players -- Housing Development Finance Corporation (HDFC) and LIC Housing Finance -- which together hold assets worth over Rs 13,500 crore in their books. However, the recent years have seen more and more banks enter into housing finance. As the cost of funds for banks hastraditionally been low, they stand a good chance of weaning away business from the two established players. The fact that banks such as SBI that have a large network of branches that can be used to service conumers of housing finance at virtually no additional costs also goes in their favour. In order to gain prominence in the business, SBI merely needs to ensure a quick response to customer needs.