After Kerala and Chhattisgarh now it’s the turn of Punjab State Government to merge the 20 District Central Cooperative Banks (DCCBs) with the apex bank Punjab State Cooperative Bank. The decision was taken by the state Cooperative Minister Sukhjinder Singh Randhawa at a high-powered meeting held last week.
Talking to this correspondent on phone Jaisrat Singh Sandhoo, Vice Chairman of Bank said, “Yes we came to know about this and it’s a welcome step by the state government for the growth and well-being of the DCCBs of the state. There are 20 DCCBs having more than 802 branches all over Punjab, mostly in rural areas of state”, he informed on telephone.
Earlier, Reserve Bank of India has recently given approval for merging the six DCCBs of Chhattisgarh with State Cooperative Bank- the apex banking entity in the state. Jharkhand has already done so and Kerala is in the process of merger. Sahakar Bharati argument against the Kerala DCCBs merger went for a toss when several BJP states themselves subscribed to the idea.
It bears recall that most of the farmers in Punjab are dependent on cooperative banks for loans, which could not be given because of the CRAR issue. The merger of the DCCBs will raise the CRAR to over 12 per cent, which in turn will help the merged bank to enhance business by Rs 8,000 crore.
The DCCBs cater to seven lakh farmers in Punjab and have a total business (advances) of Rs 10,000 crore. Over the years, lowering bank margins impacted their fiscal health, said officials.
Out of 20 DCCBs about six DCCBs are in loss leading to problem in disbursal of loans to farmers, Sandhoo informed. Merger of them with the apex bank would directly benefit the farmers, he added.
The Punjab State Cooperative Bank was established on 31st August, 1949 at Shimla vide registration No. 720 is a principle financing institution of the cooperative movement in Punjab, reads its website. “In 1951 its Head Office was shifted to Jalandhar from where it moved in 1963 to Chandigarh”, it adds.