Bihar's banks credit deposit ratio increases to 36.51% in Q1

PATNA: The credit deposit ratio (CDR) of banks in Bihar has registered a growth of 2.52 per cent to 36.51 per cent in the first quarter during 2011-12.

The state had a CDR of 33.99 per cent during the corresponding period last year, according to the data provided by the state finance department.

The Reserve Bank of India Governor D Subbarao has suggested that banks in the state would be able to achieve 35 per cent of the CDR, it said.

He has also suggested that bank wise, district wise, branch wise and sector wise analysis can bring the change.

This is for the first time in several decades, banks' CDR in Bihar has crossed the mark of 35 per cent.

While the CDR of four of 38 districts in Bihar was below 25 per cent, it hovers between 25 per cent to 30 per cent in nine districts.

Similarly, the CDR of 15 districts rose between 30 per cent to 40 per cent, while it reached above 40 per cent in the districts of Begusarai, Kishanganj, Purnia, Kaimur, West Champaran, Araria, Katihar, Samastipur, East Champaran and Bhagalpur during 2010-11.

What has changed in the CDR calculation is the bankers' bid to add up the advances given to Indian Oil Corporation and National Thermal Power Plants worth Rs 2,371 crore by a bank outside the state as well as addition of funds disbursed under the RIDF ( Rural Infrastructure Development Fund) worth Rs 2,440 crore, experts said.

If the same trend continues, Bihar will be able to achieve at least 40 per cent CDR in all the districts in the current financial year, experts pointed out, adding that Bihar has immense potential for economic development with the GSDP (gross state domestic product) growing at the rate of 11 per cent.

The upward trend is seen as a positive sign indicating higher credit flow by banks in core sector.

Deputy Chief Minister S K Modi has said that 14 blocks in the state have no no commercial bank branch as yet, while two blocks still don't have even a single branch of RRB.

Extension of the banking services to the 9,213 identified villages with population of 2,000 and above by March, 2012 has to be achieved, he added.

Modi said emphasis has been laid on increasing the number of business correspondents to streamline the projects of opening bank accounts in each household in villages having more than 2,000 population.

A total of 66 lakh no frills accounts have been opened in the state, of which 51 lakh are operational.