Founded on March 5, 1907 and officially commenced operations on August 15, 1907, Bank of India has a legacy of over a century. It has navigated several financial crises, becoming one of India’s leading financial institutions. As of September 30, 2024, Bank of India is the seventh largest public sector bank with a total turnover of ₹ 12.44 lakh crore.
Public opinion sought
On November 2, 1906, a circular went out inviting people to share their views on starting a “native bank in Madras”. The immediate trigger was the failure of the Madras-based Arbuthnot Bank in 1906, which distressed depositors, with a cascading effect on the local economy, according to bank accounts.
“Also, around the time of Arbuthnot Bank’s failure, the Swadeshi movement was launched at the Calcutta session of the Indian National Congress in 1906. The establishment of the bank reflected the nationalist desire for a reliable, Indian-managed financial institution,” say Bank of India officials. Famous Madras lawyer V. Krishnaswamy Iyer played a decisive role in the establishment of the bank. S.Rm.M. Ramaswami Chettiar, one of the bank’s first directors, became its inaugural chairman. Raja Sir Annamalai Chettiar, a highly respected leader, joined the Board in 1915, contributing significantly to its growth and development.
Head Office at Parry’s Corner
The head office was initially opened in Parry’s Buildings at Parry’s Corner. As operations grew, the head office was shifted to Bentinck’s building on North Beach Road (now Rajaji Salai) in July 1910. Then, in May 1970, it was shifted to 31, Rajaji Salai (now renamed after 66, Rajaji Salai, Chennai). -600001). The bank started with an initial capital investment of 8 lakhs.
In 1907, the bank’s emblem featured a banyan tree, a symbol of overall progress, expanded growth and continued prosperity. Another part of the symbol was a frontal view of an elephant, with a long trunk symbolizing the power of the bank. In July 1978, the bank adopted its current logo, which consists of three arrows symbolizing savings, investment and savings. The bank opened its second branch in Madurai on December 14, 1908, followed by a third in Coimbatore. It expanded internationally with the establishment of its first overseas branch in Colombo, Sri Lanka in 1932. Opened a branch in Singapore in 1941.
Before independence, the Bank of India played an important role in financing local businesses. In 1947, the bank had 73 branches with a total turnover of Rs 27.85 crore and a net profit of Rs 0.78 crore. After independence, it provided financing and financial services to industries. The turnover of the bank which was Rs 27.85 crores in 1947 had increased to Rs 161.43 crores by the time of nationalization in 1969.
Accounts and Deposits
In the 1950s, the bank introduced savings and current account services, followed by fixed deposits in the 1960s. The 1980s marked the advent of ATMs and debit cards, and in the 1990s, online banking and home loans were introduced.
Over the years, the bank acquired the businesses of Royalty Sima Bank, Bank of Algapuri, Salem Bank, Mannargudi Bank, and Trichy United Bank. In 1990, the bank acquired Bank of Thanjavur with a turnover of 114.64 crores. And the most important recent merger was the merger of Allahabad Bank with Bank of India. The merger was completed on April 1, 2020.
Bank of India came out with its initial public offering in February 2007. The bank had offered 8.5955 crore equity shares, of which 10% was reserved for employees. The issue was over-subscribed 32.03 times and the issue price was Rs.91. The bank has mobilized a total of ₹762.14 crore (₹85.95 crore equity capital and ₹696.9 crore share premium). After this issue, the share capital of the Government of India has remained at 80 percent.
Indian Bank was officially listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) after the initial public offering. On the day of listing, the bank’s equity shares touched a high of ₹ 105 on the BSE and ₹ 100.25 on the NSE.
The bank took the first steps to adopt technology through ATMs and electronic fund transfers in the 1980s. In the 1990s, the bank embraced ALM-TBC, taking its first step towards digitization. It became a pioneer in introducing tele-banking and online banking. In the 2010s, the bank focused on expanding digital services, launching mobile wallets. Also, the bank redoubled its efforts in financial inclusion in rural areas, empowering underserved communities with digital banking tools. And more recently, the bank has embraced artificial intelligence (AI) and partnered with fintech companies.
Currently, the bank is headed by Shantilal Jain, Managing Director and Chief Executive Officer. As of September 30, 2024, the bank has 5,856 domestic branches: 1,983 rural branches, 1,532 semi-urban branches, 1,174 urban branches, and 1,167 metropolitan branches. The bank also operates three overseas branches and has an international banking unit in Gift City, Gujarat.
Official statistics show that the bank caters to the needs of more than 100 million customers with 40,671 employees. The bank’s core business is lending to individuals, small businesses and public sector enterprises.
Demand may increase
The bank also focuses on providing customized solutions to corporates and government departments. In an email, bank officials told The Hindu that demand is expected to increase in retail banking and agriculture, owing to the growing economy and increasing financial inclusion in rural areas. In the next two years, the bank plans to expand its digital services and expand mobile banking, internet banking and other online services.
The bank’s net profit, which was ₹ 753 crore (on a stand-alone basis before integration of e-Allahabad Bank) for the year ended March 31, 2024, increased to ₹ 8,063 crore for the year ended March 31, 2024. In the first quarter of the current financial year (September 2024), the bank reported a net profit of Rs. ₹ 5,110 crore.
published – December 22, 2024 at 10:51 am IST