Srinagar, Jan 23: Jammu and Kashmir Bank has clarified that its general banking arrangements with the state government shall continue in future as well. The clarification comes in the wake of apprehensions over Reserve Bank of India’s agreement with the state government to carry on the latter’s general banking business and to act as sole agent for investment of its funds.
“The arrangement between the state government and the central government or between J&K Bank and RBI or the state government in no way dilutes the status of state government or J&K Bank,” reads the bank statement issued here Sunday.
“The revised banking arrangement entrusted by RBI to J&K Bank to manage the general banking business of the central government and the state government is in fact the continuation of the existing arrangement,” it adds.
According to the bank, as a direct consequence of the revision in the arrangement, all state departments, constituents of the state government shall necessarily have to maintain their official accounts with J&K Bank only.
“Through this arrangement RBI has, in a way, expanded the role of Bank in managing the banking business of the state government exclusively with the J&K bank and has entrusted the bank with more responsibility,” reads the bank statement.
While carrying the general banking business of the state, J&K Bank will continue to handle all kinds of receipts/payments of the state government, salary disbursements, pension to civil pensioners, social welfare payments, treasury payments etc. This is also in addition to responsibility entrusted upon the bank to manage general banking business of the central government at various places.
“J&K Bank is the banker to the government of Jammu and Kashmir since its inception and continues to be the same today. J&K government continues to be the main stakeholder with 53 per cent equity holding,” the statement reads.
The bank sought to inform stakeholders and customers that its stability and viability is well founded irrespective of any repayment of loan and advance.
“With business portfolio of over Rs 66000 crore now and best banking practices in vogue in all its affairs, repayments of loans and adjustments of accounts is a normal and routine affair and does not cause any issue on viability and stability of the bank,” the bank handout reads.
“We would further state that the deposits and advances of the bank grew by 13 and 11 percent respectively in FY2009-10 and in all probability J&K Bank shall achieve a growth percentage close to 20 per cent in both segments in the current financial year,” it adds.
The central government in terms of its notification dated 26 August 1972 directed that the Reserve Bank of India may inter alia appoint J&K Bank as its agent at any place within the state of J&K and subsequently initiated the process in Feb 1992 for appointing J&K Bank as its agent for transacting the general banking business of the central government including collection of taxes for and on behalf of central government. This banking arrangement in respect of central government businesses is in operation in the state.
J&K Bank has strong national presence and global recognition as 23% of its equity is held by Foreign Institutional Investors (FIIs). The bank has recorded sustained growth in its operational spheres including the deposit mobilization, credit dispensation, profitability, NPA management, benchmark profitability, liquidity and other analytical ratios.
“The revised banking arrangement entrusted by RBI to J&K Bank to manage the general banking business of the central government and the state government is in fact the continuation of the existing arrangement,” it adds.
According to the bank, as a direct consequence of the revision in the arrangement, all state departments, constituents of the state government shall necessarily have to maintain their official accounts with J&K Bank only.
“Through this arrangement RBI has, in a way, expanded the role of Bank in managing the banking business of the state government exclusively with the J&K bank and has entrusted the bank with more responsibility,” reads the bank statement.
While carrying the general banking business of the state, J&K Bank will continue to handle all kinds of receipts/payments of the state government, salary disbursements, pension to civil pensioners, social welfare payments, treasury payments etc. This is also in addition to responsibility entrusted upon the bank to manage general banking business of the central government at various places.
“J&K Bank is the banker to the government of Jammu and Kashmir since its inception and continues to be the same today. J&K government continues to be the main stakeholder with 53 per cent equity holding,” the statement reads.
The bank sought to inform stakeholders and customers that its stability and viability is well founded irrespective of any repayment of loan and advance.
“With business portfolio of over Rs 66000 crore now and best banking practices in vogue in all its affairs, repayments of loans and adjustments of accounts is a normal and routine affair and does not cause any issue on viability and stability of the bank,” the bank handout reads.
“We would further state that the deposits and advances of the bank grew by 13 and 11 percent respectively in FY2009-10 and in all probability J&K Bank shall achieve a growth percentage close to 20 per cent in both segments in the current financial year,” it adds.
The central government in terms of its notification dated 26 August 1972 directed that the Reserve Bank of India may inter alia appoint J&K Bank as its agent at any place within the state of J&K and subsequently initiated the process in Feb 1992 for appointing J&K Bank as its agent for transacting the general banking business of the central government including collection of taxes for and on behalf of central government. This banking arrangement in respect of central government businesses is in operation in the state.
J&K Bank has strong national presence and global recognition as 23% of its equity is held by Foreign Institutional Investors (FIIs). The bank has recorded sustained growth in its operational spheres including the deposit mobilization, credit dispensation, profitability, NPA management, benchmark profitability, liquidity and other analytical ratios.
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