Ramanunny confident of bringing down NPA to 5 pc within a year
KOCHI: The Thrissur District Cooperative Bank (TDCB) has posted more than four-fold increase in its net profit to Rs5.87 crore for the year ending March 31, 2018, the centenary year of its operations, though the increase has been from a low base of Rs1.38 crore the bank posted for the last year.
TDCB, which enjoys a comfortable credit-deposit ratio of 70 per cent and running a loan book of Rs3674 crore (as of March end, 2018) is operating through 58 branches. Despite the good performance, the bank seems to be wilting under the large non-performing assets (NPA) that have primarily accumulated during the past six or seven years.
The general manager of the bank, Dr M Ramanunny (seen in the picture), is now fully focused on taming the NPA overhang, which is hovering around 8.76 per cent (net) of the loan book – a disconcerting number indeed.
“We have posted a profit before provision of Rs78.6 crore for the year ending March 31, 2018, but unfortunately, the huge NPAs that add up to Rs60 crore have taken the sheen out of our performance and I am sure, soon this will change,” the bank GM told businessbenchmark.news
“We are on a tough drive on loan recovery and the results have started showing up. Most of these bad loans are supported by collaterals and in some cases, the Vigilance Department has registered cases too,” said Dr Ramanunny.
He said TDCB is hopeful of bringing the NPA levels close to 5 per cent within a year. The bank with a capital base of around Rs300 crore is comfortable on its capital adequacy ratio (CAR) at 11.5 per cent, and this certainly leaves a lot of room for growth.
The district cooperative banks (DCBs) in the state are busy girding up their loins in the ‘eve’ of their possible merger with the Kerala State Cooperative Bank (KSCB) in the run-up to the formation of the much publicized Kerala Bank – the finance minister’s per project.
Non-performing assets (NPA) is a real issue with the DCBs and according to sources, the Reserve Bank of India (RBI) has expressed its displeasure with the massive NPAs the DCBs are grappling with.
Dwelling on the business ethics the bank follows, Dr Ramanunny said TDCB offers gold loan at the rate of 8.75 per cent and house loan at rates as low as 8.25 per cent.