Cosmos Bank Aims to Meet RBI’s Loan Target with Small-Ticket Loans

Pune-based Cosmos Bank is working towards meeting the Reserve Bank of India’s (RBI) target of maintaining 50% of its loan portfolio with ticket sizes less than Rs one crore in this fiscal year.

“We are looking to achieve the RBI’s target of 50% of our loan portfolio being under Rs one crore by FY 2024-25,” said Milind Kale, the Chairman of Cosmos Bank, at a media conference in Mumbai. He added that the bank plans to use its network of 179 branches to meet this goal.

Currently, 43% of Cosmos Bank’s loan book consists of loans below Rs one crore, Mr. Kale stated.

Regarding business plans, the bank does not intend to focus on more acquisitions in the near future. Since 1999, Cosmos Bank has acquired 18 banks and added 90 branches to its network. This year, it might add five to ten branches, depending on regulatory approval, Mr. Kale said.

The bank, which was affected by cyberattacks six years ago, plans to increase its technology spending to up to 20% of profits, or 8-9% of operating expenses, in 2024-25. Additionally, it aims to reduce costs by cutting human resource expenses through increased automation.

Cosmos Bank is targeting deposit and credit growth of 15% in FY 2025, similar to its growth in FY 2024. The bank reported a net profit of Rs 384 crore for FY 2024, surpassing its capital base of Rs 350 crore. It plans to use part of the additional profits to reward its staff with an equivalent amount of one month’s salary.