Vizag Co-op to take over Ramachandrapuram bank

The Visakhapatnam Cooperative Bank (VCB), the largest cooperative bank in Andhra Pradesh, is in the process of taking over the Ramachandrapuram Cooperative Bank in East Godavari district. VCB had recently signed a memorandum of understanding (MoU) with the loss-making, single-branch Ramachandrapuram bank to acquire the latter.

"RCB has been incurring losses since the last several years and its governing body had requested us to merge the bank with VCB. We have informed the Reserve Bank of India (RBI) and the Registrar of Cooperative Societies (RCS) and are awaiting final approval," PV Narasimha Murthy, secretary, VCB, said.

RCB's deposits stand at Rs 1.38 crore and advances at about Rs 80 lakh. Its non-performing assets (NPAs), however, are very high. "Once we get the approval from the RBI and the RCS, it would set things right," Murthy said.

Post merger, VCB's branch network would increase to 15, including the 4 branches that came along with the merger of Bobbili Cooperative Bank in November 2007.

Meanwhile, VCB is planning to set up a branch in Hyderabad, for which it is awaiting the regulator's approval. The bank has deposits worth Rs 354 crore, while advances stand at Rs 249 crore. During the current year, it is expecting a net profit of Rs 6 crore as against Rs 4 crore in the previous year.