Kerala Bank records net profit of Rs 209 crore this year, says Minister V N Vasavan

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Thiruvananthapuram, Jul 8 (PTI) Kerala Bank has posted a net profit of Rs 209 crore in the year 2023-24, with deposits, loans and overall business showing a rising trend, state Cooperation Minister V N Vasavan said on Monday.

Vasavan was responding to a submission moved by Leader of the Opposition V D Satheesan in the State Assembly, pointing out that NABARD has lowered the bank's rating from 'B' to 'C' category following inspection for the financial year 2022-23.

In his submission, Satheesan said there was a lack of inspection in member-societies and that the non-performing assets, which should have been under seven per cent, have now gone above 11 per cent.

"After the NABARD inspection, Kerala Bank's classification has been demoted to the 'C' category from 'B' category. Now, according to NABARD's Credit Monitoring Arrangement guidelines, 'C' grade-rated banks can only provide a personal loan up to Rs 25 lakh," Satheesan said.

Satheesan also alleged that many primary cooperative banks are on the verge of closure as they are not getting any assistance from Kerala Bank.

However, these allegations were countered by Vasavan, who said primary cooperative banks were being assisted by Kerala bank as per RBI guidelines.

"The rating was degraded in the 2022-23 inspection. But all issues have now been rectified for the 2023-24 inspection. If Kerala Bank was not there, then many district banks would not have existed," Vasavan said.

The Minister said the rating change will only affect disbursal of personal loans and there is no cap on all other loans.

"Kerala Bank has been reporting profits every year since its formation. And this year, we have a record profit. Last year, the profit was Rs 20 crore, but this year we have Rs 209 crore profit," Vasavan told the Assembly.

He said Kerala Bank aims for loans to MSME, long-term agriculture-gold loans, and housing loans, among others, and the NABARD rating will not affect these.

He reiterated that the rating issue will be resolved in 2023-24. PTI RRT RRT SS