West Bengal Chief Minister, Ms. Mamta Banerjee should be more actively involved in the banking affairs of the state, said RBI. The banks in the state haven't been able to actively reach the desired credit growth due to absence of large private investments.
RBI has invited Ms. Banerjee to the next month's state level bankers' commitee (SLBC) meeting. The regulator has sent her reminders through office of finance department and the SLBC convenor for the state United Bank of India.
Chief ministers attending SLBCs is not new, CMs of Maharashtra and Andhra Pradesh have been attending such meetings for a while now; Ms. Banerjee, since she assumed office in May 2011 hasn't attended a single SLBC meet. Former CM of the state Mr. Buddhadeb Bhattacharjee, was also not very frequent to such meetings.
Presence of a CM can contribute a lot to the banks' and RBI's motive of better credit penetration; Mr. Anup Bhattacharya, former chairman Bank of Maharashtra said that the crop loans disbursals went up three times after the state chief minister attended one such meeting in 2011.
Rural areas of West Bengal struggles from low credit offtake; while in terms of deposits mobilization, the bakn is among the top performers. Credit deposit (CD) ratio at 64% is way below the national average of 74%; while in some rural regions the CD ratio is as low as 40%.
"While it is acknowledged that enhancement of CD ratio will require big ticket investment in the state, attempts are to be made to progressively increase the ratio in the coming years by enhancing annual credit plan" read the report issued by United Bank of India in the last meeting of SLBC in May 2011.