Kerala Bank records ₹61.99 cr. net profit in first full fiscal since formation

9.27% hike in deposits, NPA brought down to 14.40%

September 29, 2021 03:56 pm | Updated 04:18 pm IST - THIRUVANANTHAPURAM

The Kerala Bank has a total business of ₹1,06,396 crore as on March 31, 2021.

The Kerala Bank has a total business of ₹1,06,396 crore as on March 31, 2021.

The Kerala Bank has recorded a net profit of ₹61.99 crore in the first full financial year after its formation, Minister for Cooperation V.N. Vasavan has said.

Speaking at a press conference here on Wednesday, he said that the bank posted an increase of 9.27% in deposits from ₹61,027 crore to ₹66,731 crore. The bank has a total business of ₹1,06,396 crore as on March 31, 2021.

Mr. Vasavan said that the bank had been able to bring down its Non-Performing Assets (NPA) from over 25% during the time of merger to 14.40% now at ₹5,738 crore.

IT integration

“Despite the first financial year of the bank coinciding with the COVID-19 pandemic, which was marked by economic devastation, the Kerala Bank was able to achieve this. The majority of the customers are from the economically weaker sections. The information-technology integration processes will be completed within three months, which will lead to more NRI deposits and also help it compete with new generation banks,” he said.

The refinance loan through National Bank for Agriculture and Rural Development (NABARD), which stood at ₹4,315 crore in 2019-20, rose to ₹6,058 crore in 2020-21, posting an increase of 40.39%. The accumulated loss of the bank stood at ₹1,151 crore during the merger of 13 district cooperative banks with the Kerala State Cooperative Bank to form Kerala Bank. This has been brought down to ₹714 crore.

The capital to risk weighted asset ratio (CRAR), which was 6.26% at the time of formation of Kerala Bank, has touched 10.18% now. The Reserve Bank of India had stipulated only 9% CRAR. The ₹400 crore that the Kerala government had pumped in is the main support that helped the bank to push up the CRAR.

Focus areas

The bank is focused on priority sector of agriculture, service, trade, MSME, micro finance and rural housing. Its main focus now is on disbursing retail loans. It has disbursed a total of ₹18,200 crore loans directly and through Primary Agriculture Cooperative Societies (PACS) during the year. The bank has decided to implement a micro-food processing scheme which comes with NABARD subsidy that will benefit small entrepreneurs. The ‘Vidyanidhi’ scheme for schoolchildren will be rolled out soon.

The cooperative sector in the State has so far lent the lion’s share of Kerala’s agriculture loans through PACS who are also the shareholders of the bank and who numbers more than 1,500.

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