TRIVANDRUM: The Reserve Bank of India (RBI) on Wednesday gave its nod to start that Kerala Bank, a venture proposed by the Kerala government.
The bank has been formed by merging 20 district cooperative banks with the State Cooperative Bank. All except the Malappuram district cooperative bank had given their nod for the merger. The government overcome the hurdle over the Malappuram unit’s resistance through an ordinance.
The bank will be called Kerala Bank and it will have all the facilities of a commercial bank, including ATMs. Government sources said that the new bank will start functioning from the Kerala formation day on November 1.
Kadakampally Surendran, minister for co-operation, tourism and devaswoms, said, It will be safe and reliable banking for everyone. That's our motto."
The minister had earlier claimed that the he was expecting Rs 650 billion in deposits in the bank once it was formed. He had added that the aim of the new bank was to provide modern facilities to the Primary Agricultural Cooperative Societies (PACS
Earlier, the state government had formed a special task force of experts for the formation of the Kerala Bank. The expert committee was headed by Chairman M S Sriram.
The formation of the Kerala Bank would eliminate the double or repeated charges on services, which would help to provide loans to customers at a lower interest rate. This is expected to help the agriculture, traditional works and self-employment sectors and help Kerala have deposits and credits within the state.
Unlike other lenders, the deposits in the Kerala Bank could be provided as credit within the state, which would help the growth of basic facilities, the minister had said recently.
The State Cooperative Bank's net non-performing assets (NPAs), in percentage terms, as on March 31, 2017, stood at 2.52 per cent, while for district cooperative banks, it ranged between 3.81 per cent and 16.36 per cent, according to the government.