Page 22 - Banking Finance July 2021

CO-OPERATIVE BANK NEWS

to providing the best service and The bank's operating profit stood at Rs with grant of loans, till September 24,
products to the bank's customers.'' 758 crore, same as the previous year. 2021.
Last year, the operating profit
Senior official from Maharashtra RBI had first imposed the restrictions
Gramin Bank quoted "We at increased due to receipt of with effect from the close of business
Maharashtra Gramin Bank are government guarantee of Rs 304 crore on March 25, 2019, under Sub-Section
towards interest.
confident that the Bancassurance (1) of Section 35A read with Section 56
partnership with Liberty General Vidyadhar Anaskar, chairman of the of the Banking Regulation Act,
Insurance shall add value to the bank's board of administrators of the bank, 1949(AACS), in the public interest in
esteemed individual customers and said during FY21, the operating profit view of the weakened financial
solicit, procure and service retail lines was the result of pure business condition of the bank.
of general insurance products and operations. The net NPA ratio The validity of the directions has been
commercial lines products." increased to 1.21% from nil in FY20 extended from time to time and were
due to the Covid-19 impact. Advances
last extended till June 24, 2021.
Maharashtra State increased 12% to Rs 23,295 crore, "These directions shall continue to
from Rs 20,817 crore in the previous
Cooperative Bank reports fiscal. apply to the bank for a further period
of three months from June 25, 2021 to
Rs 369-crore net in FY21 The MSC Bank is the apex cooperative September 24, 2021, subject to
Maharashtra State Cooperative Bank bank in the state and lends mostly to review," said an RBI statement.
(MSC) Bank has reported a net profit agricultural enterprises like sugar mills The central bank further said that it
of Rs 369 crore for the financial year and agri-processing units. Anaskar said may consider modifications in
2021, a rise of 14% over the previous the total exposure to the sector is Rs
22,000 crore, of which Rs 10,000 crore directions depending upon the
year. circumstances and the issue of
is earmarked for the sugar sector as
The bank's total income dropped 30% directions should not per se be
pledged loan. The bank's proposal to
to Rs 2,427 crore, from Rs 3,485 crore. construed as cancellation of banking
foray into retail lending, however, has
The bank had made provision of Rs license.
been rejected by the Reserve Bank of
1,012 crore towards NPA loan write-off India, he said. "The bank will be able to undertake
and Rs 455 crore general reserves banking business with restrictions till
write-off, according to senior officials. its financial position improves," it said.
RBI extends restrictions on
The gross profit of the bank fell to Rs The notification dated March 13, 2019
776 crore, compared with Rs 1,345 Punjab-based Hindu Co- by the central bank said that without
crore for the previous year, down 42%. operative Bank prior approval, the bank will not be
In FY20, general reserves of Rs 455 The Reserve Bank of India (RBI) has able to grant or renew any loan, make
crore, Rs 62-crore IDR (investment extended the restrictions on Hindu Co- any investment, incur any liability
depreciation reserve) and Rs 75-crore operative Bank Limited, based out of including borrowal of funds and
old IR (overdue interest reserve) were Pathankot, Punjab, in terms of acceptance of fresh deposits, among
written back (total Rs 592 crore). withdrawal and deposit limits along others. T

RBI caps dividend payout by NBFCs

In a move that will increase transparency in respect of the financial health of finance companies, the RBI has linked
dividend payout to balance sheet parameters.
Boards of non-banking financial companies (NBFCs) have been asked to factor in RBI's observation during supervision
and the notes to accounts before approving a dividend.
The new dividend distribution norms prescribed by the regulator apply to all finance companies, including core
investment companies. The rules cap the maximum dividend payout ratio at 50% of net profit for all NBFCs, but
allow a higher payout of 60% for core investment companies and primary dealership firms.

22 | 2021 | JULY | BANKING FINANCE