The financial year 2019-20 for the Maharashtra State Cooperative (MSC) Bank would be a memorable one for the bank, which reported highest disbursal of loans in its 109-year history. Vidyadhar Anaskar, chairman of the board of administrators, said the bank has also managed to report 0 per cent net non-performing asset (NPA) for the first time in its history.
The bank also reported a record operating profit of Rs 758 crore.
Sitting at the apex of the cooperative credit structure in the state, the MSC Bank was dismissed by the Reserve Bank of India in 2011 due to mounting losses and alleged financial irregularities. The bank was controlled by the NCP and Congress and the board of directors, which was superseded, included names like NCP leader and current Deputy Chief Minister Ajit Pawar, among others. Back then, the bank had reported a total loss of Rs 1,069 crore.
Since 2011, the bank has been under a board of administrators, which has been steering the bank’s business since them.
The financial results of the bank show that the bank has reported record disbursal of loans worth Rs 20,817 crore, the highest in the history of the bank. Similarly, the bank has reported total business of Rs 41,666 crore, again a record high. The bank has reported 0 net NPA for the first time in its history.
However, the net worth of the bank has shown erosion from the last fiscal. As against the Rs 2,682 crore net worth reported in 2018-19, the bank has now reported a net worth of Rs 2,282 crore. The net profit of the bank reported at the end of the last fiscal was Rs 325 crore.
The bank has managed to provide 100 per cent provision for its bad loans, which has taken the net NPA to zero.
“Nationalised banks have 46 per cent coverage while cooperative banks have 64 per cent such coverage,” said Anaskar. The bank has managed to de-risk its loan portfolios by increasing its exposure to sectors other than sugar mills and district central cooperative banks.
Anaskar has indicated that the bank wants to get into retail business like home or car loans in the future. In this regard, the bank has given a proposal to the RBI for a merger with Rupee Cooperative Bank.
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