India’s RBL bank boost retail focus, from loans to deposits

India’s RBL Bank is looking to ramp up its retail exposure to protect its books from being over-exposed to large corporates and to help bolster growth alongside its key businesses of credit cards and microfinance, the private lender’s top executive told Reuters on Tuesday.

To improve its focus on the retail and mid-sized corporate segments, RBL has introduced new loan products such as two- and four-wheeler loans, gold loans and education loans while tweaking and relaunching other products such as loans against property.

“All these products will be able to give a yield of 9%-14% and will allow risk to be diversified from corporate and microfinance book,” Chief Executive R Subramaniakumar said in an interview.

Subramaniakumar took over as CEO in June, six months after the Reserve Bank of India appointed an additional director to RBL’s board without giving a clear reason. In the past, the central bank has placed its officials on the board of banks to improve regulatory oversight in case of concerns.

Besides a revamped bouquet of loan products, RBL will also focus on cross-selling across its portfolio, the CEO said.

The bank is also working towards improving its return on assets (RoA) and return on equity (RoE). Subramaniakumar expects an RoA of 1% by the end of this year, rising to 1.5% next financial year and reaching around 1.7% by the end of FY25.