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A well structured and efficient network of financial institutions helps to boost the economic growth. These financial institutions provide credit to all sections of the society and for infrastructure projects at reasonable rates. After liberalization the international financial institutions transformed the conservative financial sector into dynamic ones.


The financial market encompasses a number of financial entities like banking institutions, Joint stock companies, insurance companies, mutual funds, venture capital funds, pension funds etc that perform a significant role in providing finances. These institutions supplement the role of banking sector in meeting the increasing financial needs of the corporate sector and delivering credit to the un­organized sector. But the financial sector of J&K is dominated by banks. Banks are meeting the financial requirements particularly of the un-organized sector and the self employed in the micro and small business sectors. Infrastructure development which is regarded as a crucial source of economic competitiveness has heavy dependence on bank financing. Many ambitious flagship infrastructure development projects for achieving the long cherished objectives of equitable and inclusive growth are routed through banks. The insurance sector though well capitalized, is significantly exposed to banking system. By mobilizing resources, banks enable optimal use of financial resources. To meet the objective of financial inclusion, banks are deepening and broadening their network apart from diversifying domain of their activities and jurisdiction. The institutional structure of banking in J&K consists of several institutions, namely, commercial banks, regional rural banks and co­operative banks. The aim of these credit agencies is to dispense adequate credit at cheaper rates.


As on 31/03/2015, 1936 branches of scheduled commercial banks, co-operative banks and state financial corporation (SFC) were in operation in J&K. The number of branches has risen by 5.73% over 31-03-2014. The share of scheduled commercial banks is 85.80% with 27.76% of public sector banks, 50.87% of private sector banks and 21.37% of regional rural banks. 13.48% share is held by central/state co­operative banks and only 0.72% is the share of state financial corporation (SFC).

 

 

No. of bank branches as on

Bank Group

March
2014

March
2015

% age share

Growth in
%

(I) Public sector banks

433

461

23.81

6.47

(ii) Private sector banks

789

845

43.65

7.10

(iii)Regional rural banks

340

355

18.34

4.41

A. Total Scheduled commercial banks

1562

1661

85.80

6.34

B. Central/state co-operative banks

255

261

13.48

2.35

C. Other Financial Institutions (SFC)

14

14

0.72

0.00

Total (A+B+C)

1831

1936

100

5.73

With the increase in the branch network over the years, there has been notable improvement in the banking services. Dependence per bank branch reduced substantially both geographically as well as demographically. On an average 1 bank branch is available per 7 thousand people as on 30-09-2014 where as that for India, it is 10 thousand persons as on 31-03-2013. More importantly, the coverage of area per bank is declining year by year. During the year 2014-15 (September, 2014) one branch was available per 53.56         Sq. kms. This indicator is 30.26 sq. km for India during the reference period 31-03-2013. Following table provides overview of banking infrastructure with some business indicators over the years at state level.

Development in Banking Sector

Year as on march

Bank
branches

Average per branch

Deposits
(crore Rs)

Credits
(crore
Rs)

Credits
per
hundred
deposits

Area (sq. km.)

Population
(000)

2006

856

118.44

14

19281

8658

44.90

2007

867

116.94

14

21956

10377

47.26

2008

914

110.93

13

25148

12090

48.08

2009

973

106.05

13

29355

13587

46.29

2010

1002

101.18

13

34233

16050

46.88

2011

1302

77.87

10

45695

16252

35.57

2012

1449

69.97

9

55144

18949

34.36

2013

1638*

61.90

8

64480

23542

36.51

2014

1831*

55.37

7

72214

32196

40.52

2015

1936*

52.39

6

78978

36508

42.65

 

Gross Bank Credit
The credit is a catalyst that lubricates the process to accelerate the development of the economy. Apart from farm and non-farm sectors, industrialization, business and service segments require adequate credit supply. As on 31-03-2015 gross bank credit stood at Rs 36,508 crore as compared to Rs 32196 crore for 2013-14 showing growth of 13.39% over previous year 2013-14. The share of private sector banks in the credit disbursement as on 31-03-2015 was tremendous and accounted for 66.88% followed by 24.18% of public sector banks. While 95.39% share of total disbursement of credit is claimed by scheduled commercial banks only 3.15% is shared by central/state cooperative banks and 1.46% share of state financial corporation.

Aggregate deposits
As against Rs. 72,214.22 crore ending 2013-14, deposits of financial institutions as on 31-03-2015 stood at Rs.78,977.67 crore, posting an increase of 9.37% over previous year (2013-14). In aggregate deposits, the share of private sector banks is again tremendous i.e. 65.82 %, the next highest share of 25.80% is claimed by public sector banks. Overall share of scheduled commercial banks in deposits is 96.00 % and only 4.00 % contribution belongs to central and state cooperative banks. Growth rate in aggregate deposits ending 03/2015 over the financial year 2013-14 in respect of Public Sector Banks was over 10% and rest of the agencies have growth rate below 10% over the previous Financial year.

Credit -deposit ratio
Credit-deposit ratio is an impressive indicator utilized for measuring the business performance of banks. Higher growth in advances i.e. 13.39% and lower growth in deposits (9.40%) improved the CDR from 44.58% as on March 2014 to 46.23% ending March, 2015. This indicates increase in CDR by 1.65%. Across the bank groups, substantial improvement in CDR was noticed in all groups except public sector banks which showed decrease of 2.54%.

Following table provides information about deposits, advances, and CDR and growth rate with bank group-wise details, numerically for J&K:-

Agency wise deposits and advances of scheduled commercial banks (Rs in crore)

Agency

2014-15

2013-14

% age variation

Deposits

Advances

CDR

Deposits

Advances

CDR

Deposits

Advances

i) Public Sector banks

20373.80

8830.42

43.34

18350.45

8418.29

45.88

11.02

4.89

ii) Private sector banks

51987.02

24419.46

46.97

47691.46

20803.73

43.62

9.06

17.38

iii) Regional rural banks

3450.57

1576.22

45.68

3203.07

1400.70

41.20

7.73

12.53

SCBs total ( i-iii)

75811.39

34826.10

45.94

69244.98

30622.72

44.22

9.48

13.73

Centre/State Cooperative
Banks

3166.28

1149.43

36.30

2969.24

1032.58

34.78

6.64

11.32

(SFC)

_

532.88

 

_

541.13

_

 

-1.52

Total All

78977.67

36508.41

46.23

72214.22

32196.43

44.58

9.37

13.39

 

   
     
     
     
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Mr. Parvez Ahmed
Chairman & Chief Executive Officer
Convenor J&K SLBC
The Jammu & Kashmir Bank Ltd.
Corporate Headquarters
M.A Road Srinagar,
Jammu and Kashmir, India
Phone: 0194-2481900,

Fax:0194-2481902

Mr. Vagish Chander Sharma
Executive President,
Personnel & HRDD/ Trainings, Disciplinary Deptt, Management of Board Secretariat,
FSD/ Insurance, JKGB Management, Customer Care/ Compliance/ KYC/ AML, Lead Bank, FID/CSC.
Corporate Headquarters
M.A Road Srinagar,
Jammu and Kashmir, India

Telephone/ Fax: 0194-2502614/ 2502615
Ext. No: 1450, 1451
Cell No: 9479176977
Email: vc.sharma@jkbmail.com  

Mr. Rakesh Gandotra
Vice President,
Lead Bank Department, Financial Inclusion Department / Common Services Centre, Strategy & Business Development Division.
Corporate Headquarters
M.A Road Srinagar,
Jammu and Kashmir, India

Telephone/ Fax: 0194-2502639
Ext. No: 1139
Cell No: 9815922320/ 9810642320
Email: rakesh.gandotra@jkbmail.com  

SLBC Secretariat
J&K State Level Bankers' Committee (SLBC)
Corporate Headquarters
M.A Road Srinagar,
Jammu and Kashmir, India

Telephone/ Fax: 0194-2502639
Aircel: 8803004089, 8803004095
Ext. No/s: 1141 and 1142 
Email: convenorbank@jkbmail.com
 
 
 
 

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