Federal Bank, private sector lender is aiming to increase its gold loan-book by up to 18% during 2013-14 in spite of recent fall in prices of the gold. As of March 31, 2013, its gold loan portfolio stood at over Rs 6,300 crore. To achieve this target, the Kerala-headquartered bank has reduced the Loan to Value ratio (LTVs), which was not above 70%.
Federal Bank is the fourth largest bank in India in terms of capital base and can easily boast of a Capital Adequacy Ratio of 17.23%, one of the highest in the industry. This along with the existence in a highly regulated environment has helped the bank to tide over the recession with minimum impact to its financial stability.
