The banks in the state of West Bengal have seen a decline in their credit-deposit ratio. The credit deposit (CD) ratio for the lenders in state fell from 65% to 64%. The sluggish economic growth, increased interest rates, and lack of big ticket investments have resulted in the same.
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 (for the state)," said a note circulated by Union Bank of India (UBI), which also happened to be convener of state level banker's committee (SLBC) on the issue.
The state minister of finance, Mr. Amit Mitra showed his concerns about the decline in CD ratio, more importantly the poor rural ratio, which at 44% was much less than the state average. The minister stated, "We have to find out the factors behind the low CD ratio".
He has also called for a special meeting in June to emphasize on Kissan Credit Cards (KCC) to improve the credit flow in the economy and priority sector. The banks have fared better than the last year in issuing KCCs.
The banks are hopeful of better loan disbursements in the Kharif crop season.