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MINUTES OF THE 36TH SLBC MEETING, BIHAR HELD ON 18TH MAY, 2011 AT HOTEL CHANAKYA, PATNA STATE LEVEL BANKERS’ COMMITTEE, BIHAR CONVENOR STATE BANK OF INDIA SLBC DEPARTMENT LOCAL HEAD OFFICE, W.GANDHI MAIDAN, PATNA PHONE NO- 0612-2209076 FAX NO-0612-2209075 WEBSITE: http://slbc.bih.nic.in 1 MINUTES OF THE 36TH REVIEW MEETING OF THE STATE LEVEL BANKERS’ COMMITTEE, BIHAR FOR THE YEAR ENDED MARCH 2011 HELD ON 18TH MAY 2011 The 36th review meeting of State Level Bankers’ Committee, Bihar was held on 18th May 2011 at Hotel Chanakya, Patna, under the Chairmanship of Shri Nitish Kumar, Hon’ble Chief Minister. Shri Sushil Kumar Modi, Hon’ble Deputy Chief Minister & Finance Minister, Shri Giriraj Singh, Minister of Animal & Fisheries Resources, Shri Awadhesh Prasad Kushwaha, Minister of Minor Irrigation , Smt. Renu Kumari, Minister of Industries and Shri Nitish Mishra, Minister of Rural Development attended the meeting as Special Invitees. Among others, the meeting was also attended by Shri Shashi Kant Sharma, Secretary, Department of Financial Services, Ministry of Finance, Government of India, Shri Pratip Chaudhuri, Chairman, State Bank of India, Shri S. Sridhar, Chairman, Central Bank of India, Shri J.P.Dua, CMD, Allahabad Bank, Shri Arun Kaul, CMD, UCO Bank, Shri M. Prasad, CMD, Agriculture Insurance Company of India Ltd. and Shri R.V. Verma, Chairman, National Housing Bank. In his opening remarks, Shri Jeevandas Narayan, CGM-SBI & Convenor of SLBC, welcomed Shri Nitish Kumar and Shri Sushi Kumar Modi and other distinguished guests and assured that all banks will put in their best efforts for contributing to the overall development of the State as the celebrations of 100 years of formation of our State are underway. He further presented an overview of the performance of banks during FY 2010-11. As to cover the un-banked villages by opening banking outlets, he informed the House that against a target of covering 3,468 villages in FY : 2010- 11, only 2,126 unbanked villages could be covered till 31st March 2011. He urged the 2 concerned banks to put in more focused efforts and accelerate the process with renewed enthusiasm to ensure that the task is completed well before the deadline of 31st March 2012 in the remaining 7087 villages. Continuing his address, Shri Narayan stated that CD ratio has been a major area of concern for all banks and due to the efforts put in by all of them, CDR has improved by 186 basis points as on March 2011 as compared to the March 2010 position, while Incremental CDR during the period touched a level of 45.98% (in both these parameters, the growth achieved during the year was the highest recorded during the last 5 years). He informed the House that a disbursement target of Rs. 43,200/- Crore has been fixed for FY 2011-12 and the same has already been allocated to different banks. He urged the Controlling Heads of all banks to ensure that the targets allotted to their Banks are achieved well before the end of current financial year. He further stated that banks should take advantage of the conducive business environment provided by the State Government to increase their lending. Regarding amendment in the PDR Act, he expressed sincere gratitude to the State Government, particularly, the Hon’ble Deputy Chief Minister and Finance Minister of Bihar for taking this progressive step. He further requested the State Government to give urgent attention to raising a special battalion of police for security of Banks to enable the latter to provide unhindered banking services to the customers in a more secure environment, especially in the remote areas of the State. Thereafter, a short presentation was made by Shri Anupam Kumar Suman, Officer on Special Duty, Institutional Finance Directorate, GoB, on the banking scenario in Bihar. He stated that since banks had done well in disbursing loans under MSE segment during 2010-11, the targets set under MSE for FY: 2011-12 might be revised upwards. Further, he stated that to enable the banks to disburse more loans under AGRI segment, the scale of finance should be revised upwards. He further stated that the achievement of banks in providing credit support to Dairy, Fishery, 3 Poultry and BIGIWIS has been far from satisfactory. Also, he highlighted the issue of pendency of licences for opening of branches and requested concerned banks to open the branches for which licences have already been procured by them from RBI. He further requested Controlling Heads of banks to pay attention to single-officer branches, which are about 700 in number, as customer service and other activities get affected on this count. He also drew the attention of the House to the fact that two RRBs and Co-operative Banks are still not on CBS platform which is adversely affecting the business of these banks. On the issue of opening of banking outlets in villages having population of over 2000, he expressed concern as some banks have not covered even a single village as on 31st March 2011. Drawing the attention of the House to lack of progress in the implementation of SAMIS in the State, he said that branch-wise monitoring is being affected due to non-stabilisation of SAMIS. He underscored the need for proper maintenance of Application Received and Disposal Register at some of the bank-branches and also highlighted the issue of less than 50% achievement of PMEGP targets. He further desired that banks should finance the proposals cleared by State Investment Promotion Board (SIPB) as this will help in improving the CD ratio in the State. Addressing the House, Shri Pratip Chaudhuri, Chairman, State Bank of India stated that the Bank is the convenor of SLBC in as many as 12 States and 2 UTs in the country and Bihar is among the most important States in this list. He expressed his happiness over the rapid growth the State has been witnessing in almost all fields of economic development in the last 5 – 6 years under the leadership of Shri Nitish Kumar, the Hon’ble Chief Minister of Bihar. He informed the House that the growth witnessed in bank deposits and advances during FY 2010-11 was better than the national average and due to better growth registered in advances, CD ratio improved by 186 basis points during the year and stood at 33.99% as on 31st March 2011 while Incremental CDR touched an even higher level of about 46%. He opined that CDR should be viewed in a slightly broader perspective, taking into account the 4 credit extended to units such as IOC, NTPC as also some large sugar mills by the banks from branches outside the State, since the funds were deployed in the State. He stated that with the active support from the State Government, banks will be drawing up more challenging action plans to tap the potential for credit growth in the State, particularly in the agriculture and agro-based industrial sectors as the State is blessed with abundant water resources. He expressed the hope that with better water-shed management and implementation of action plans for water harvesting, the demand for bank credit would rise significantly. He requested all banks to be in a state of readiness to participate in the mega credit camps whole-heartedly which are scheduled to be held in May-June and again, in October-November, at all Block Headquarters by the State Government to sanction and disburse more loans under Agri sector, to enable the farmers to start their agricultural operations without any difficulty. Further, he asserted that to achieve the ambitious ACP target for FY: 2011-12, banks need to provide requisite impetus to branch expansion and carrying forward the agenda of financial inclusion and stated that the population served per bank branch in Bihar was around 23,200 (based on 2011 census) which needed to be brought down to around 15,000 to be at par with some of the more developed States and also to take banking services within the reach of the financially excluded population. He said that banks need to open at least 2500 additional branches in order to reach the level of 15,000 people serviced per bank branch and requested all banks to bestow their focused attention to the matter and ensure that more bank branches are opened in the State. For providing basic banking facilities by setting up ICT- based banking outlets in all villages having population of over 2000, he expressed his concern that banks could 5 cover only 2126 villages against the target of 3468 villages as on March 2011. Non- achievement of the targets set by banks themselves has increased their responsibility in the current year as the remaining 7087 villages have to be covered by March 2012. He urged the controlling heads of the concerned banks to bestow their personal attention to this area and issue appropriate directives for opening banking outlets in the identified villages within the stipulated time-frame. Before concluding, he thanked the State Government for providing unstinted support to banks to bolster the collective campaign for the development of the State. Addressing the House, Shri S. Sridhar, CMD-Central Bank of India informed that 41 branches of CBI and 25-30 Branches of UBGB (sponsored by CBI) would be opened during 2011-12. Apart from this, 55 ATMs will be installed during FY 2011-12. He further stated that the bank has opened 15 lakh no-frill accounts and OD facility of small amounts ranging from Rs. 500 to Rs. 2500 is being provided to all the No-frill account holders.

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