The Kolhapur-based Ratnakar Bank plans to raise up to Rs 375 crore through certificates of deposit (CDs). Rating agency Icra, an associate of Moody’s Investor Service, has assigned a rating of A1+ to the bank’s short-term money market instrument.
Naresh Karia, chief financial officer, said access to the institutional CD market is one of several elements of a bank’s resource-raising avenues. The bank’s deposits rose to Rs 2,042 crore by the end of March this year from Rs 1,585 crore a year earlier. Its advances rose much faster. Its credit at the end of March was Rs 1,905 crore, up from Rs 1,170 crore a year before, said Icra. The asset base as of March was Rs 3,200 crore.
A little over 60 per cent of the bank’s advances were in the state, a high degree of regional concentration. The profitability declined in 2010-11 on account of high one-time expenses. The gross non-performing assets ratio improved to 1.12 per cent at the end of March from 2.33 per cent at the end of March 2010.
The asset quality has remained stable over recent years. It showed improvement in 2010-11, with the fresh NPA generation rate dropping to 0.42 per cent as compared to 1.86 per cent in 2009-10. Further, during 201-11, the bank increased focus on recoveries, which resulted in significant collections from overdue accounts. Hence, the gross NPA ratio improved to 1.12 per cent (2.33 per cent at the end of March 2010.)
