Saraswat set to acquire Mandvi Co-op Bank
The country’s largest cooperative bank, Saraswat Cooperative Bank, will take over Mumbai-based Mandvi Cooperative Bank. This is the second major acquisition by Saraswat after it took over the failed Maratha Mandir Cooperative Bank in April this year.
The acquisition will increase Saraswat’s business by over 11% to over Rs 12,000 crore, making it larger than some of the smaller private banks. It will also give Saraswat over 18 new branches in Mumbai city. The bank has embarked on acquisitions as a growth strategy after the central bank refused to grant fresh licences to cooperatives.
RBI has been trying to bring down the number of cooperatives through the process of consolidation. Saraswat Bank had declared a net profit of Rs 101.2 crore for the year ended March 31, ‘06. Deposits for the financial year ‘05-06 stood at Rs 6204.2 crore while advances amounted to Rs 4,608 crore. The bank’s capital adequacy ratio stood at 12.11%, while the bank’s paid-up capital was Rs 48.97 crore.
Mandvi Cooperative Bank has 18 branches and a central loan processing cell in addition to its headquarters, all of which are located in Mumbai. Mandvi Bank, which commenced operations in ‘74, had been conferred with a Scheduled Bank status with effect from January ‘00.
The bank has a full-fledged money changer licence and also provides depository services at ten of its branches. In the end of ‘05-06, the bank had a net profit of Rs 1.71 crore and reserves and other funds of Rs 55.19 crore. The bank has a paid-up capital of Rs 10.55 crore. Its total advances stood at Rs 575 crore while deposits were Rs 652 crore.
Saraswat is one of the contenders for South Indian Cooperative Bank, whose future is yet undecided. The largest cooperative bank is eyeing a couple of cooperative banks in other states as well. Earlier this year, Saraswat had made a bid for the failed Ganesh Bank of Kurundwad, which RBI later merged with Federal Bank.
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