Bank CD ratio in Orissa shows improvement

 As per the RBI guideline, the commercial banks should invest at least 60 per cent of their deposits in the state of their operation. Against this, the CD ratio of commercial banks in Orissa was 56.75 per cent in 2003. But this is an improvement of over three per cent on the CD ratio of 53.39 per cent in 2000.

 Up to June, 2003, the CD ratio of commercial banks was to 53.13 per cent where it was 47.58 per cent in the corresponding period last year.

 The commercial banks have disbursed loan of Rs 10,272.62 crore by June 2003 against a deposit of Rs 19,334.93 crore. Statistics revealed that banks had disbursed loans of Rs 8,565 crore against deposit of Rs 18,002.64 crore during the corresponding period last year.

 According to a RBI survey, the combined CD ratio of registered commercial banks in Orissa is higher than the average CD ratio for the eastern states.

 The average CD ratio of registered commercial banks for the eastern states was 38 per cent, 37.2 per cent and 36.6 per cent in 1999, 2000 and 2001 where as the same for Orissa was 44.2 per cent, 42.8 per cent and 41.6 per cent respectively. The ratio has further improved to 45.94 per cent in 2002and 52.12 per cent in 2003, the survey said.

 However, the low CD ratio of the private banks operating in the state is a matter of grave concern, says state finance minister Panchanan Kanungo. Stating that higher CD ratio is a index development, the minister pointed out that many developed states had CD ratio of more than 70 per cent.

 Kanungo pointed out that the state finance secretary had convened a meeting of the officials of private banks operating in the state in June last year where he had underlined the need of improving their CD ratio. The private banks had been asked to increase their CD ratio to at least 40 per cent.