Vizag Coop Bank cuts NPAs by 6 per cent

Visakhapatnam Cooperative Bank (VCB), the largest cooperative bank in Andhra Pradesh in terms of share capital, managed to reduce the gross non-performing assets (NPAs) by more than 6 per cent during 2005-06 at Rs 3.99 crore. As of March 2005, VCB's gross NPA was 8.45 per cent at Rs 8.36 crore.

"We have initiated several measures to reduce NPAs. Branch-wise melas were held and notices were served under the Securitisation Act for recovery of old and bad loans," P V Narasimha Murthy, secretary, VCB, told Business Standard.

With the drastic reduction of NPAs, the bank is now expecting a net profit of about Rs 5 crore in the year 2005-06 as against the net profit of Rs 2 crore in 2004-05. It paid 10 per cent dividend to its shareholders in 2004-05.

Its total business touched Rs 444 crore by the end of this fiscal as compared to Rs 386 crore recorded in the same period last year. In 2005-06, the bank sanctioned about Rs 43 crore new loans as against Rs 33 crore in the preceding year, he added. "We have achieved 7 per cent growth in deposit collection during this fiscal compared to the previous year. By the end of March 2006, our total deposits touched Rs 260 crore as against Rs 243 crore by the end of March 2005," he stated.

During the just-ended financial year, another Rs 2.83 crore new share capital was added to the bank. With this, the total share capital of the bank stands at Rs 15 crore.

Murthy said that the bank would open 4-5 more branches if the Reserve Bank of India gives permission. The bank currently operates 10 branches in Visakhapatnam district. Of the 10 branches, six had been computerised and the remaining would be computerised during 2006-07, he said.