District co-operative banks’ bad loan ratio hits 12.6%: FM Nirmala Sitharaman

In contrast, the atrocious indebtedness ratio of scheduled commercialized banks stood astatine 7.5% arsenic of March 2021, having eased from 8.4% a twelvemonth before, the RBI said successful its latest study this month.

Finance curate Nirmala Sitharaman connected Tuesday told the Rajya Sabha that gross atrocious loans of territory cardinal co-operative banks (DCCBs) were among the highest successful the banking system, astatine 12.6% (`35,298 crore) of their advances arsenic of March 2020.

The curate said the gross non-performing assets (NPAs) of municipality co-operative banks (UCBs), too, remained elevated astatine 11.3% (Rs 35,528 crore) astatine the extremity of March 2021. However, the gross NPAs of authorities co-operative banks were to the tune of 6.7% (Rs 13,477 crore) arsenic of March 2020, Sitharaman said successful a connection successful the precocious House.

In contrast, the atrocious indebtedness ratio of scheduled commercialized banks stood astatine 7.5% arsenic of March 2021, having eased from 8.4% a twelvemonth before, the RBI said successful its latest study this month.

The finances of co-operative banks came nether heightened scrutiny precocious aft the authorities carved retired the section of co-operation from the agriculture ministry to marque it a full-fledged ministry nether Amit Shah. Before that, affairs of the co-operative assemblage came nether absorption pursuing the situation astatine the Punjab Maharashtra Co-operative (PMC) Bank successful 2019. This had prompted the authorities to amend the Banking Regulation Act to empower the RBI for much effectual regularisation of cooperative banks. The thought was to amended support the interests of depositors and debar a PMC Bank-like situation successful future.

Citing the latest data, Sitharaman said determination are 34 authorities co-operative banks, 351 DCCBs and 1,534 UCBs successful the country.

Separately, RBI information show, arsenic of March 2020, India had arsenic galore arsenic 97,006 agrarian co-operative banks — which see some authorities co-operative banks and DCCBs, and a immense fig of superior cultivation recognition societies.

In a written reply successful the Rajya Sabha, curate of authorities for concern Bhagwat Karad besides said arsenic galore arsenic 28 UCBs are placed nether the all-inclusive directions of the RBI, nether which they are restricted from discharging their liabilities without the support of the cardinal bank.

The assets of UCBs stood astatine Rs 6.5 lakh crore arsenic of March 2021, portion their indebtedness portfolio was worthy Rs 3.1 lakh crore, Sitharaman said, citing the RBI data. Similarly, according to information sourced from Nabard, the assets of authorities co-operative banks and DCCBs were to the tune of Rs 3.4 lakh crore and Rs 5.4 lakh crore, respectively, arsenic of March 2020. Similarly, their loans stood astatine Rs 2 lakh crore and Rs 2.8 lakh crore, respectively.

Many of the cooperatives, acknowledgment to their opaque operation and terrible governance issues, person been allegedly utilized to funnel black money for long.