Kochi, Kerala-based South Indian Bank (SIB) is setting an ambitious target of 13-14% credit growth by the financial year 2027 (FY27), according to Dolphy Jose, the bank's executive director. This growth projection comes despite a somewhat cloudy global economic outlook.
A key driver for SIB's anticipated growth is a significant uptick in Foreign Currency Non-Resident (FCNR) deposits. The Reserve Bank of India (RBI) recently opened a special window for FCNR (B) deposits, creating an industry-wide opportunity. Jose noted that SIB expects strong growth in this segment, forecasting FCNR deposits to climb around 20%, contributing to an overall liability growth of 17% or higher in the current financial year.
Expanding Beyond Kerala: A Strategic Shift
While SIB has historically maintained a strong presence in its home state of Kerala, accounting for 30% of its over Rs 1 lakh crore loan book as of Q4 2026, the bank is now focused on strategic expansion. Jose outlined plans to double down in Tamil Nadu, where it already has a decent footprint, and subsequently grow its presence across other southern states like Karnataka, Andhra Pradesh, and Telangana. Expansion into Western India is also a key part of this strategy.
The bank currently operates a network of 948 branches, with other southern markets contributing 33% and the rest of India 37% to its loan book.
Focus on Retail, MSME, and New Offerings
SIB is intensifying its focus on the retail and Micro, Small, and Medium Enterprises (MSME) segments, and has recently ventured into the mid-market space. While gold loans have seen strong industry-wide traction, with SIB projecting around 25% growth in this area for the current financial year, the bank aims to avoid being solely identified as a gold loan provider. Instead, it seeks to be recognized more broadly as an MSME and retail-centric institution.
Looking ahead, SIB is also gearing up to scale its wealth management business and plans to launch its own credit card. This new credit card offering, moving beyond its existing co-branded card with a fintech partner, is expected to roll out by the end of the current financial year or the first quarter of FY2028.
West Asia Conflict: Minimal Impact on Remittances
Despite ongoing conflict in West Asia, a region with a significant number of non-resident Indian customers for SIB, the bank has not observed any negative impact on remittances. In fact, Jose noted an initial increase as individuals sent more money home. While concerns exist within the industry regarding potential long-term impacts on input costs and logistics for MSMEs if the conflict prolongs, there are signs of easing, with hopes for a return to normalcy in the coming months.