NRIs now account for 47% of bank deposits in Kerala
Nandu:
Here is an interesting news item from the home front,wonder how much of that is yours!!!<g>
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Joe A Scaria (Economic Times)
THIRUVANANTHAPURAM 7 OCTOBER
The phenomenon of expatriate Keralites filling in the cash boxes of commercial banks back home just got stronger, with the proportion of NRI deposits to total deposits increasing to a whopping 47.10 per cent.
Sources in Canara Bank told The Economic Times that NRI deposits in commercial banks in Kerala had touched an all-time high of Rs 15,745 crore as on June 30, 1999. The NRI deposits form 47.10 per cent of the total commercial bank deposits of Rs 33,429 crore in the state.
Banking sources, however, have not been able to explain how the NRI deposits have continued their upward trend despite a recessionary trend since last year. NRI deposits in the state have grown sharply from Rs 10,469 crore at the end of September 1997 to Rs 15,745 crore now, notwithstanding the reported loss of jobs for Indian expats in the Gulf countries, and the sluggishness in the foreign job markets.
Banking statistics that were finalised after the review meeting of the State Level Bankers' Committee held here showed that commercial banks in Kerala had disbursed credit worth Rs 5,997 crore as on March 31, 1999 under the Annual Action Plan.
Total advances as on June 30, 1999 amounted to Rs 13,919 crore and the credit-deposit ratio remained on the low side at 41.64 per cent. Of the total lending, Rs 6,329 crore went to the priority sectors.
Saddled with funds from both domestic depositors and NRIs, banks in Kerala have traditionally had a skewed credit-deposit ratio, a matter that has been hotly debated by the state government and the commercial banks in the state.
While the state government insists that the banks are indifferent to the credit requirements in Kerala and are averse to lending, the banks claim that they are always willing to lend to bankable and viable projects.
Bankers have also pointed out that Kerala presented a unique case as it had deposits from local people as well as NRIs, which inflated bank balances and therefore depressed the CD ratio. "Without considering the NRI deposits, commercial banks in the state have a CD ratio as high as 78.71 per cent," a banker pointed out.
CD ratio of banks in the state moved up marginally from 41.80 per cent as on December 31, 1998 to 43.06 per cent as on March 31, 1999, and has fallen to 41.64 per cent as on June 30, 1999.
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