Bank of Maharashtra, one of India’s largest state-run lenders, has embarked on an ambitious expansion plan to significantly increase its branch network. Here are the key details and numbers associated with this expansion:
Expansion Plan Overview
- Number of New Branches: The bank plans to add 215 new branches over the next 12 months, aiming for a substantial increase in its network across the country.
- Total Branch Network Goal: By the end of 2024, the Bank of Maharashtra aims to expand its network to 2,500 branches.
Geographic Spread and Strategic Focus
- National Coverage Ambition: The bank intends to establish at least one branch in all 780 districts of India, enhancing its pan-India footprint.
- Current Presence: As of the information available, the bank is present in 540 districts, up from just 280 districts five years ago.
Operational Model and Branch Functionality
- Hub and Spoke Model: The bank has adopted a hub and spoke model for its expansion. It plans to have a total of 600 such branches by the end of FY2023.
- Customer Service Points: Surrounding each branch will be 5-6 customer service points, each a 100 square feet mini-branch, open for four to five days a week and overseen by a business correspondent.
- Operational Cost: The operational cost of each customer service point is Rs 30,000 a month. The employees at these points are outsourced.
Financial and Business Impact
- Deposit Mobilization and Credit Requests: These customer service points will mobilize deposits and handle credit requests, which will be referred back to the main branch.
- CASA Ratio and Business Growth: The bank’s rapid expansion strategy is credited with helping maintain a high CASA ratio of 56%, significantly above the banking sector’s average of 45-48%.
- Credit Growth: The bank’s credit growth stands at 22%, surpassing the industry average.
- Specific Branch Types: Bank of Maharashtra has specialized branches, including five housing finance branches, 10 branches for vehicle financing, and five agri investment credit branches for funding agricultural projects.
Current Status and Future Goals
- Status as of June 2023: As of June 2023, the bank had a customer base of 30 million across the country with 2,263 branches. It holds the record for the largest network of branches of any nationalized bank in the state of Maharashtra.
- Performance: The Bank of Maharashtra has emerged as a top performer among public sector lenders in terms of loan and deposit growth during 2022-23, recording the highest growth in profitability with its bottom line growing almost 126% to Rs 2,602 crore during the year.
This expansion strategy is part of the bank’s broader ambition to strengthen its presence across India and enhance its service offerings to a growing customer base, particularly in tier 2 and tier 3 locations.