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Home » Bihar » Bihar lags in credit-deposit ratio, 2018-19 witnesses decline of 1.29%

Bihar lags in credit-deposit ratio, 2018-19 witnesses decline of 1.29%

On Wednesday, Deputy Chief Minister Sushil Modi, who is also the state's finance minister, directed banks and financial institutions to be proactive in providing loans for higher investment at SLBC meeting.

By Newsd
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Bihar’s credit-deposit ratio has witnessed a decline of 1.29% in FY (Financial Year) 2018-19 in comparison to the previous year. As per the figures, CD ratio in the FY 2018-19 was 44.09%, while in 2017-2018 it stood at 45.38% – a slide which shows how much investment has been pumped into a state by banks.

In FY 2018-19 banks in the state distributed Rs 1,45,120 crore loan against deposit of Rs 3,45,234 crore. In FY 2017-18 Rs 1,34,997 crore loan was given against deposits of Rs 3,12,829 crore.

On Wednesday, Deputy Chief Minister Sushil Modi, who is also the state’s finance minister, directed banks and financial institutions to be proactive in providing loans for higher investment at State Level Bankers Committee (SLBC) meeting.

Briefing media he said, the CD ratio of Bihar for FY 2018-19 has come down by 1.29% in comparison to FY 2017-18 but the state has managed to gain CD ratio in past 12 years.

He added the slide in C-D ratio is primarily due to the lagging character of banks and people’s tendency to save and deposit money in banks. Two districts, Bhojpur and Saran, reported having the least credit-deposit ratio. In Saran, the ratio was less than 30%, whereas in Bhojpur it stood at 29%.

There are a couple of reasons that could account for the low C-D ratio:

  • The unwillingness of banks to lend fearing of Non-Performing Assets (NPAs)
  • People preferring bank deposit over investment.

The meeting was also attended by state agriculture minister Prem Kumar, industries minister Shyam Rajak and rural development minister Shravan Kumar.

The SLBC meet was scheduled to be addressed by Chief Minister Nitish Kumar but he could not attend the same as he was participating in another meeting convened by Prime Minister Narendra Modi on the ‘One Nation-One Election’ issue.

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