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AP StCB’s Record Business Growth in Covid FY

The southern apex level bank is planning expansion in its branches and ATMs in the current FY:

Dr. R. Shreenath Reddy informs that APCOB has extended special facilities like covid personal loans

The A.P State Co-operative Bank (APCOB), as the scheduled bank is at the apex level in Andhra Pradesh. The bank has 16 branches, dispensing credit through the 418 branches of 13 district co-operative central banks (DCCBs), to the 1992 PACS at the village/ground level, which in turn cater to the credit and non-credit needs of their farmer members.
Under the single window credit delivery system, it is providing refinance both for long-term and short-term credit through DCCBs. Dr. R. Shreenath Reddy, Managing Director, updates: “The total business of the bank has increased by an all-time high growth rate of 34.96% to Rs210.49 billion as on 31 March 2021. Deposits have shot up by 38.36% to Rs52.24 bn. The business per employee improved and stood at Rs873.4 mn.”

Mobilizing Deposits
There are a number of factors responsible for growth in business parameters of the bank. In the financial year 2020-21, the individual deposits of APCOB have seen a growth of 25% to Rs2.80 bn and institutional deposits of the bank have increased to Rs49.44 bn, registering a record growth of 39.18%. Reddy explains: “It was possible by conducting various programs like regular deposit mobilization campaigns, door to door campaigns, and customer meetings at branches for mobilizing individual deposits and by the constant persuasion by the bank with a special team of business development officials, consisting of senior manager and liaison officer, who are primarily working for mobilization of institutional deposits and other banks deposits.”

Cash Credit By Consortium
APCOB extends mainly short term and long-term loans to DCCBs, apex co-operative federations, government corporations, individuals, SHGs etc. Gross bank credit has increased by 33.88% to Rs158.24 bn as on 31 March 2021. Reddy cites reasons: “APCOB started cash credit facility under consortium mode to Streenidhi Credit Cooperation Federation, Vijayawada to an extent of Rs13.50 bn. APCOB also sanctioned cash credit limit of Rs2 bn to AP MARKFED and Rs3 bn to AP State Seed Development Corporation for procurement of seeds and another Rs2 bn cash credit for lien on procured stocks. Further, the bank also sanctioned cash credit limit of Rs50 mn to TTD Employees Cooperative Credit Society, Tirupathi and the total loan outstandings have y/y increased to Rs18.40 bn as on 31.03.2021 Rs10.60 bn under direct lending.”

NPA Improves, Net Profit Up
Capital and reserves of APCOB have increased to Rs15.39 bn, recording a y/y increase of 31.95%. Due to increase in loans and advances as well as curtailing the business expenditure, the operating profit stood at Rs2.37 billion at the end of March 2021 with an increase by Rs532.4 million over previous year. Return on assets (ROA) is 0.92%. CRAR increased to 10.53% from 10.40% a year ago.
Reddy updates: “Net profit increased to Rs1.44 bn, recording a growth rate of 49.14% y/y as on 31 March 2021. The gross and net NPAs, to gross and net advances, stood at 0.88% and 0.29% respectively as on 31 March 2021, which is an improvement over the previous year from 1.16% and 0.42% respectively.”

Branch, ATM Expansion
In order to enlarge the presence of DCCBs in rural areas, branch expansion extension counters program has been taken up, as one branch / extension counter per mandal (area), in a progressive manner, over a period of 2-3 years for effective delivery of all financial and non-financial services. Reddy points out: “APCOB has received license for opening of 2 branches from RBI in the current FY. We are also planning to open 6 more branches. For DCCBs, permission was granted for opening of 3 branches and 1 extension counter of Krishna DCCB and 3 branches in Vizianagaram DCCB in the last financial year. Permission is also granted for opening 4 branches of Nellore DCCB, 10 branches of Chittoor DCCB & 20 branches of Guntur in the current FY.”
APCOB presently has 16 onsite ATMs and 2 mobile ATMs. Reddy further says: “2 onsite ATMs will also be set up for the proposed opening of 2 new branches. Our 13 DCCBs have 293 onsite & off-site ATMs and 40 mobile ATMs.”

Initiatives During Covid
In order to meet the credit demand of SHG groups, the bank has provided Rs50,000 loans to SHGs @10% p.a. with a moratorium period of 6 months through ‘Special SHG loans COVID-19’ scheme. Reddy informs: “Besides, our bank has also extended special loan facilities like covid personal loans, e-vidya, ‘Corona Kavach’ and also implemented resolution framework 1.0 & 2.0 for customers.”

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