Bandhan plans to open 20 branches

Bandhan Financial Services, which has received in-principle approval to start banking operation, plans to set up 20 branches in the state in 2015-16, said a Reserve Bank of India (RBI) official.

"Bandhan, as a microfinance institution (MFI) already has presence in the state. They target to have 20 branches of their proposed bank in Odisha during the current fiscal. They plan to convert their fixed location offices in the state to bank branches," said P K Jena, regional director, Reserve Bank of India, Bhubaneswar on the sidelines of 139th state level bankers' committee (SLBC) meeting here. Last year, Bandhan along with IDFC Limited were granted in principle approval by RBI to set up banks.

In addition, public sector banks Punjab National Bank and Andhra Bank propose to open 40 and 75 new branches in the state respectively in 2015-16.

The banks having operations in Odisha have lagged behind their targets in opening of new branches during the last fiscal. Against the target of 1,118 new branches in the unbanked gram panchayats set for 2014-15, only 119 branches could be opened in the year under review.

"The progress (of opening of branches) has been pretty slow," Jena observed.

It may be noted that the SLBC has drawn up an ambitious plan to cover all 4,597 unbanked gram panchayats by 2019. To facilitate this effort, the state government has assured the banks that space would be provided in panchayat buildings and Rajiv Gandhi Seva Kendras free of cost for five years.

The total number of bank branches in Odisha now stands at 4,672, out of which 54.43 per cent are in rural area.

The CD (credit deposit) ratio of the banks in Odisha has declined compared to the previous fiscal.

While the CD ratio was 85.31 per cent in 2013-14, it has dipped to 73.19 per cent in the last fiscal. The CD ratio, excluding the advance sanctioned through branches in other states and utilised in the state, is just 52.32 per cent, failing to achieve the mandated rate of 60 per cent. Only five districts - Dhenkanal, Khurda, Sonepur, Kalahandi and Bhadrak have CD ratio of more than 60 per cent.

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel