R. Ramabhadran Pillai
To open first ATM soon
It has initiated a computerisation driveSpecial emphasis on micro credit disbursal
KOCHI: The North Malabar Gramin Bank (NMGB) is planning to open its first ATM in 2007. The bank has initiated a computerisation drive, which will be completed in six months. The bank has launched a host of schemes to suit the changing needs of its clients in rural, semi-urban as well as urban areas, according to the bank chairman S.S. Shet.
Outlining the major initiatives in an interview to The Hindu, Mr. Shet said that though the bank retained its primary focus on rural banking, it had to chalk out a strategy in tune with the times. It was with this perspective that the bank planned its course of action. Engaging in forex business and executing an agreement for selling insurance products of United India Insurance Company and Bajaj Alliance were part of this approach.
The bank, sponsored by Syndicate Bank, was established in 1976 with its headquarters in Kannur. The ownership of the bank was vested with the Government of India, Syndicate Bank and Government of Kerala in the ratio 50:35:15. With a network of 160 branches spread across Kasaragod, Kannur, Wayanad, Ernakulam, Kottayam and Alappuzha districts, the bank had over 1,000 employees and a customer base of 14 lakh. The 161st branch of the bank was opened in Kochi on Friday. The area of operation of the bank would be extended to Kollam soon.
The role played by the rural bank was significant because the advances were distributed within the State, Mr. Shet said. The bank disbursed more than Rs.1,000 crore against a deposit of Rs.975 crore. The CD ratio of the bank is 115 per cent against the State average of 68 per cent.
"The rural banks in general have a local touch," said Mr. Shet. "As for NMGB, 89 per cent of the business comes from rural areas. The changing lifestyle of rural people makes it necessary for the bank to extend more facilities there," he said.
The bank, with nine branches in Wayanad, extended help to the distressed farmers. It had written off agricultural loans worth Rs.30 lakh due from farmers who had committed suicide. Moratorium was imposed on repayment of farm loans in Kasargod, Kannur and Palakkad. Rephasing of farm loans has also been taken up in many cases.
The bank was keen on extending further help to the agricultural sector. Nevertheless, viability of schemes was crucial. The CD ratio in some branches in Wayanad crossed 300 per cent, he said. The Government could support the bank by way of investing a portion of its funds in it, according to him.
Priority sector and agriculture lending continued to be the main focus. Priority sector advances to the tune of Rs.900 crore constitute 89 per cent of the total lending. Agricultural advances, amounting to Rs.550 crore, account for 49 per cent of the total credit. The bank disbursed Rs.325 crore as agricultural advances during the year.
Special emphasis was made on micro credit dispensation through self-help groups. More than 9,000 SHGs were operating their accounts with the bank. More than 1.8 lakh Kisan Credit Cards were issued by the bank so far.
The bank was promoting farmers clubs. It earned an operational profit of Rs.13.16 crore during the first half of the current financial year. The per employee business rose to Rs.2.05 crore and the per branch business increased to Rs.13.10 crore.
Mr. Shet said the bank achieved a recovery rate of 83 per cent and NPA level of 2 per cent of the outstanding advances.