The Congress-led United Progressive Alliance (UPA) government?s debt waiver scheme for farmers, which was sneered at by the CPI(M), will help the West Bengal State Cooperative Bank (WBSCB) reduce its non-performing assets (NPAs) in the agriculture sector.
?The NPA of agricultural loans in the three regions of the bank will come down substantially when the revival package and debt waiver scheme of the Union government will be implemented,? Samir Kumar Ghosh, chairman of WBSCB, said. During the year to March 31, 2008, it had to make additional provisioning for the shortfall in agricultural loan recovery and this proved to be a drag on its net profit growth.
For the year, the bank posted a net profit of Rs 10.15 crore, marginally up from Rs 10.03 crore in 2006-07. The gross NPA ratio increased from 5.01% on March 31, 2007, to 5.89% on March 31, 2008, with the bulk coming from the agriculture sector.
?We expect the NPA level to come down to 2% or even less after that,? Ghosh said. Deposits increased by 5% to Rs 2,575 crore in 2007-08 from Rs 2,450 crore in 2006-07. Advances grew by 11.5% to Rs 2,207 crore in 2007-08 from Rs 1,980 crore in 2006-07. Meanwhile, the bank has been waiting for over a year for the Reserve Bank of India to clear 10-15 new branches and extension counters that it proposes to add to its existing network of 41 branches. The bank has maintained its gross NPA at 5% for the previous two fiscals.
