Bank’s loan portfolio in Kerala has about 65 per cent gold loans
C L Jose
KOCHI/October 24-2923: Is CSB Bank yet another gold loan company in Kerala?
The question may sound a bit intriguing but the findings are interesting. CSB Bank’s loan portfolio in Kerala has about 65 per cent gold loans, whereas gold loans account for much less in the loan book of Manappuram Finance, one of the most established gold loan companies in the country.
“The Kerala operations of the Thrissur-based CSB Bank gives an impression that the CSB Bank’s is a much more dedicated gold loan operations than even Manappuram Finance Ltd,” a top official of another gold loan company observed.
Manappuram gold loans at 55 pc
While Manappuram’s (all India) gold loan portfolio at Rs20,603.2 crore against its total assets under management (AUM) at Rs37,086 crore (as of June end, 2023) works out just 55.55 per cent, CSB Bank’s outstanding gold loans in Kerala at Rs3,504.27 crore account for 65 per cent of the outstanding loans in the state as of September end, 2023.
CSB Bank’s investor presentation reveals that 33 per cent of the total gold loans at Rs10,619 crore are in Kerala. And at the same time, the same presentation also adds that 24 per cent of the bank’s gross loans are again in Kerala.
Given that the total loan book of the bank as of September 30, 2023 is valued at Rs22,468 crore, the CSB Bank’s loan outstanding in the state is estimated at just Rs5,392.32 crore.
This proves that the bank’s gold loans in Kerala at Rs3,504.27 crore is not only the largest single portfolio in Kerala, but rather constitutes 65 per cent of the total loan outstanding in Kerala as of September 30 2023.
Deposit market
Most Kerala based banks view state as a potential deposit market with CSB Bank’s position in this being more pronounced.
While Gross advances of CSB Bank in Kerala are just 24 per cent of the total loans in the country, the bank has raised 53 per cent of its total deposits from the state.
This works out a low credit-deposit (CD) ratio of about 40 per cent. In fact, the RBI has been raising its concern about the low CD ratio being maintained within the state by the Kerala based banks.
