Will wipe out ₹2,162 crore losses by March 2028: Bihar Gramin Bank Chairman

Bihar Gramin Bank's JEEViKA exposure at ₹11,500 crore; NPAs below 2%

Mukul Sahay, chairman of Bihar Gramin Bank, in a telephonic interaction with Harsh Kumar of Business Standard, said the lender is confident of wiping out its accumulated losses ahead of schedule, improving capital adequacy to regulatory levels, and expanding into MSME and retail segments while maintaining its strong rural focus. He also spoke about NIM pressures, merger integration, NPAs, JEEViKA exposure, and listing plans. Edited excerpts:

 

The bank is carrying accumulated losses. By when do you expect to wipe them out?

 

As of March 31, 2025, we had accumulated losses of about ₹2,162 crore. Our internal projection is to wipe these out by March 2028. However, with the recovery efforts and business initiatives we have undertaken, we are hopeful of achieving this before the projected timeline.

 

Infrastructure and technology at RRB branches remain a concern. What steps are you taking?

 

Improving branch infrastructure has been a priority since I took charge. Basic facilities such as furniture, stationery, and computers must be available in every branch. We have instructed field functionaries to address gaps immediately. We are upgrading branches in phases, starting with urban centres, followed by semi-urban and rural areas. Technology equipment has already been provided to ensure uninterrupted customer service. Over the next year, we aim to significantly improve the look and functionality of our branches.

 

Is competition from private banks and small finance banks in rural areas affecting you?

 

We do not see it as a major challenge. Our presence is deep at the panchayat level, and we work closely with self-help groups. We offer competitive interest rates and operate as a government-backed institution. Through financial literacy camps and outreach programmes, we are strengthening our connect with customers.

 

What is your growth outlook for this financial year?

 

We are projecting around 10 per cent growth in both advances and deposits. CASA growth is expected at about 8 per cent. Our credit-deposit ratio is around 65 per cent. Total advances stood at roughly ₹31,000 crore as of December 2025.

 

How has the merger under the ‘One State, One RRB’ policy helped?

 

The merger was a complex exercise involving IT and operational integration, but it was executed smoothly with minimal inconvenience to customers. Post-merger, operational efficiency has improved, and policies have been harmonised. Financial indicators have shown improvement as well.

 

What is the current NPA position and outlook?

 

Gross NPAs stood at around ₹6,604 crore in September 2025 and came down to close to ₹6,200 crore by December 2025. Agriculture remains a challenging segment, given Bihar’s agrarian profile, but recovery is our top priority. We expect further improvement by March 2026.

 

How large is your agriculture portfolio?

 

Our agriculture portfolio is around ₹24,434 crore out of total advances of about ₹31,000 crore. This includes Kisan Credit Cards and loans to self-help groups.

 

What is your exposure under JEEViKA?

 

We have over five lakh JEEViKA-linked accounts, with exposure of around ₹11,500 crore. Our share is nearly 44 per cent of total banking exposure under the programme in the state. NPAs under JEEViKA are less than ₹200 crore, which is under 2 per cent. Close coordination with community mobilisers and regular monitoring have ensured healthy repayment performance.

 

What is the status of your capital adequacy and listing plans?

 

CRAR was 7.22 per cent in March 2025 against the required 9 per cent. It improved to 8.03 per cent by December 2025. We are confident of crossing 9 per cent by March 2026 through profit generation and recovery efforts. Before considering listing, we must wipe out accumulated losses. Strengthening capital and profitability is our immediate priority.