In a written reply in Lok Sabha, Union Home and Cooperation Minister Amit Shah has shared key insights into the Credit-Deposit (CD) Ratio variations among State Cooperative Banks (StCBs), District Cooperative Banks (DCCBs), and Urban Cooperative Banks (UCBs) across India.
Urban Cooperative Banks (UCBs) appear to be the most stable in terms of CD ratios, with most maintaining a balance between lending and deposit utilization. Their ratios mostly stay below 75%, reducing liquidity risks while ensuring steady credit expansion.
State Cooperative Banks (StCBs) show aggressive lending in certain states like Rajasthan and Andhra Pradesh, where CD ratios exceed 300%, which could lead to higher profitability but also potential liquidity concerns and NPA risks.
District Central Cooperative Banks (DCCBs) display the most instability, with some banks lending excessively above 300%, while others have CD ratios as low as 5-10%, indicating weak credit activity. The variation in lending patterns suggests that while some cooperative banks are expanding aggressively, others struggle to efficiently utilize deposits.
A high Credit-Deposit (CD) ratio means that a bank has lent out a large portion of its deposits. While it may result into higher profitability, it has also risk of liquidity crunch for banks and a fear of rise in NPA if the loans are not paid. A healthy CD ratio is typically between 75-85%.
The data reflects significant differences in lending patterns, highlighting both high and low credit disbursal trends among cooperative banks.
Rajasthan recorded the highest Credit Deposit (CD) Ratio among State Cooperative Banks (StCBs) at 365.86, followed by Andhra Pradesh (354.41) and Haryana (245.56). Other states with strong lending activity included Tamil Nadu, Telangana, Karnataka, Madhya Pradesh, and Maharashtra. In contrast, Chandigarh had the lowest CD Ratio at 21.43, with Daman and Diu and Assam also showing low ratios. Several states had moderate CD Ratios, including Gujarat, Uttarakhand, Puducherry, and Punjab.
District Cooperative Banks (DCCBs) also displayed a wide range of ratios. Madhya Pradesh saw some banks with exceptionally high ratios, such as Shajapur (236.43%) and Rajgarh (206.01%). In Odisha, Balasore Bhadrak Central Co-Operative Bank had a 97.00% CD Ratio, while Bhopal Co-Operative Central Bank recorded just 8.80%.
Urban Cooperative Banks (UCBs) varied as well, with Ahmedabad Mercantile Co-Operative Bank at 57.1%, Akhand Anand Co-Op Bank at 74%, and the Kolkata Police Co-Op Bank reporting a high 103.8%.
Shah also highlighted the ongoing digital transformation in Rural Cooperative Banks (RCBs), with 39 RCBs having internet banking licenses, 135 with mobile banking, and 362 under MICR/CTS.
