Earlier
during the year, it had tied up with the Chennai-based Indian Bank
to sell its life insurance policies. Under the agreement, Union
Bank will:
1) Identify 20 branches in Mumbai, through which it will
facilitate sale of policies.
2) From out of these 20 branches, the bank will pick 20 junior
officers, who will be assigned the task of selling. These officers
will have to reach out to customers of their bank’s branches in
the areas assigned. These officers will be provided training by
HDFC Standard Life, which will also bear the cost of training.
3) The officers will be given targets, which they will have to
achieve like they are given in the case of deposits and loans.
4) Gradually, the bank will increase the number of branches to
sell policies from out of its network, which comprises 2,053
branches spread all over the country, though concentrated largely
in Uttar Pradesh and Maharashtra.
5) Officers will be entitled to performance-based incentives.
The bank,
in the meantime, has done well in the second quarter ended 30
September 2001. While the operating profit rose about 10 per cent
to Rs 116.90 crore from Rs 105.80 crore in the corresponding
period last year, the net profit after tax too increased about 10
per cent to Rs 37.30 crore. The figure in the corresponding period
of the previous year was Rs 34.10 crore.
In
the first half ended 30 September
2001, the net profit rose 34.40 per cent to Rs 100.30 crore, in
comparison to Rs 74.60 crore in the corresponding period last
year. The jump came about on the back of a 70.36 per cent increase
in other income, which moved up to Rs 208 crore from Rs 122.10
crore in the corresponding period. The bank has decided not to tap
the capital market for issuing equity due to poor market
conditions. However it may raise tier 2 capital of Rs 100 crore
towards the end of the year.