Commercial banks falter in advancing crop loans

As many as 28 out of 41 commercial banks operating in the state have failed to achieve the 18 per cent lending target stipulated by the Reserve Bank of India (RBI) for the agricultural sector, by September end.

Public sector lenders that have fallen short of the target include State Bank of India (15.01 per cent), Allahabad Bank (11 per cent), Andhra Bank (17.02 per cent), Bank of Baroda (15.43 per cent), Canara Bank (11.8 per cent), Central Bank of India (8.28 per cent), Oriental Bank of Commerce(2.1 per cent) and Punjab National Bank (17.87 per cent) among others.

Punjab & Sind Bank, State Bank of Mysore, State Bank of Travancore and ING Vysya bank have failed to open their accounts.

The private sector banks which have faltered in achieving the target include Kotak Mahindra Bank (8.86 per cent), Karanataka Bank (11.41 per cent), HDFC bank (10.03 percent) and Indus Ind bank (6.16 per cent).

On the contrary, all the regional rural banks (RRBs) - Baitarani Gramya Bank, Kalinga Gramya Bank, Utkal Gramya Bank, Neelachal Gramya Bank and Rushikulya Gramya Bank have achieved RBI stipulated targets.

Expressing displeasure over this, Chief Minister Naveen Patnaik said that there is serious imbalance between the share of cooperatives and commercial banks financing the credit needs of the agriculture sector.

“The commercial banks and regional rural banks must share at least 50 per cent of the credit requirements of the agriculture sector and it must be given top priority”, Patnaik said at the inaugural ceremony of the 129th meeting of State Level Bankers Committee organized here on Thursday.

Patnaik said, even if the overall CD (credit deposit) ratio of the banks is around 76 per cent in the state, the ratio continues to be below 40 per cent in few districts.

On the whole, the CD ratio of all the banks stood at 75.8 per cent. District-wise analysis of CD ratios shows a lopsided trend. While Sambalpur languishes at the bottom of the table with CD ratio of 10.71 per cent, Naxal infested Malakangiri had a CD ratio of 19.76 per cent. The CD ratios of Deogarh (33.34 per cent), Gajapati (39.25 per cent), Jagatsinghpur (36.95 per cent), Nuapada (37.64 per cent) and Kandhamal (38.30 per cent) were also disappointing.

The banks having low CD ratio includes Bank of Maharashtra (40.14 per cent), Indian Bank (58.47 per cent), Vijaya Bank (29.35 per cent), Indus Ind Bank (42.85 per cent), ING Bank Vysya Bank (3.23 per cent) among others.

The banks have achieved 79 per cent of the lending target in the first six months of the current fiscal. Of the total credit target of Rs 12505 crore, the bankers have lent Rs 9837.30 crore.

The Annual Credit Plan has been pegged at Rs 29,927.41 crore for 2012-13, an increase of 20 percent over the credit plan of Rs 25,019.39 crore fixed for 2011-12.

Commercial banks should play a greater role in advancing loans to the agricultural sector as 95-96 per cent of the state’s deposit is mopped up by them, said Prasanna Acharya, state finance minister.