Co-op bank to take inorganic growth path
Shamrao Vithal Co-operative Bank (SVCB), a scheduled bank with branches in Karnataka, Maharastra and Goa, plans to take over four more cooperative banks in Karnataka and Maharastra.
Chairman of the bank Suresh Hemmady told reporters here that the bank was looking at smaller banks. The RBI has restricted cooperative banks from opening more branches and as such the SVCB was unable to expand its own branch network.
He, however, did not reveal the names of the banks it proposed to take over. The process is in the initial stages, he said. The SVCB, established in 1906, has 72 branches spread across the three states and crossed a turnover of Rs 4,600 crore till the end of third quarter of this financial year.
By March-end, the bank aims to reach a business of Rs 600 crore. The chairman informed that the bank had paid 18 per cent dividend to its shareholders for the last two consecutive years.
This year, the dividend will go up to 20 per cent to mark the centenary of the bank, he added. Claiming that integrity and professionalism among the directors of the bank was key to its success, Hemmady said that valued-added services also contributed to the popularity of the bank.
Vardhaman Co-op Bank
The Sindhanur Souharda Co-operative Bank is all set to take over the Vardhaman Co-operative Bank, which is facing a severe financial crisis and is now facing the prospect of liquidation.
Vardhaman Co-op Bank chairman Abhay Mantaganikar said that the merger was in the interest of its customers. The Sindhanur Souharda Co-op Bank of Raichur district has been doing very well.
Mantaganikar said that of the Rs 22 crore as outstanding dues, the Vardhaman Bank had recovered Rs 16 crore and returned it to depositors. He said that the bank faced the threat of liquidation and to avert it the general body decided to convert 26 per cent of its deposit into share capital.
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