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Despite COVID19 crisis, J&K Bank shows improved performance: Chairman  



Bank holds 82nd AGM of shareholders

BK News

Srinagar, Sept 28: J&K Bank held the 82nd Annual General Meeting (AGM) of its shareholders for the financial year 2019-20 through videoconferencing from its corporate headquarters in view of the ongoing Covid-19 pandemic.

Financial Commissioner Arun Kumar Mehta represented the J&K UT Government, the majority shareholder of the bank. Besides, the bank’s Chairman and Managing Director (CMD) RK Chhibber, Directors on board of the bank, Executive Presidents, Presidents, Vice Presidents, Company Secretary and a large number of its shareholders attended the e-AGM through virtual mode.

Summing up the bank’s performance during the FY 2019-20, the CMD stated, “Despite the COVID-19 crisis which had far-reaching economic and social repercussions, J&K Bank has delivered a strong balance sheet. During the fiscal, the Bank registered an Operating profit of Rs 1525.05 crore, with an improved NIM of 3.92%. Further, taking cognizance of the continued pressure on asset quality due to impact of COVID-19, the bank enhanced NPA Coverage ratio by more than 14 percentage points from 64.30% to 78.59% while bringing down the net NPAs considerably from 4.89% to 3.48%

“Cost of deposits was maintained at 5% by improving the CASA base to 53.66%. The loan-book of UTs of J&K and Ladakh have witnessed the growth of 13% thereby re-orienting the lending composition of the bank with UTs of J&K and Ladakh getting 63% of total advances of the Bank”, he added.

Citing increased provisions as a reason for hiccups in the Bank’s journey towards glory during the last many quarters, the CMD attributed it to the increase in the level of NPAs due to impairments in the corporate portfolio outside J&K, primarily contracted under consortium/multiple bank arrangements.

“Now that J&K Bank has shifted its focus to retail and agriculture lending across the country and corporate lending has been restricted to top-rated corporates, the shift has begun yielding favourable results”, the CMD said.

Expounding on the effects of dual challenges faced by the bank since the second quarter of the FY 2019-20, Chairman R K Chhibber said, “Shortly after the disturbances during the second quarter of FY 2019-20 derailed the trade activities, the bank had to face an unprecedented disruption in the economic activity, caused globally by the COVID19, which has led to major changes in operations of trade, commerce and industries without exception.”

“The Bank was the first-mover in various initiatives which include introducing a top-up finance scheme for the business community to ease their cash flow issues, making hassle-free overdraft available in PMJDY accounts, the generous contribution of 3 days’ salary by all staff members to the COVID relief fund, disbursement of social security benefits to female PMJDY account holders, PM KISAN beneficiaries”, he added.

“J&K Bank was also quick”, he asserted, “to pass on benefits of a moratorium on loan instalments & interest servicing, announced as relief package by the Central Government, as per regulatory guidelines’, adding, “We also extended the COVID-19 stimulus package under Guaranteed Emergency Credit Line (GECL) to eligible businesses & MSMEs.  Under the Central Government’s Guaranteed Emergency Credit Line (GECL) scheme, the Bank has so far made disbursements to the tune of Rs 1639.70 crore to 46516 borrowers.”

Terming the announcement of Rs 1350 Cr financial package by the LG of J&K UT as a game-changer, he further stated, “It will help not only in revival of businesses in the UT of J&K but also relieve the Bank from a major portion of stressed assets resulted out of the current situation. Interest subvention of 5% announced in the financial package by LG J&K Manoj Sinha along with the release of previous year’s interest subvention aggregating to about Rs 1081 crore in favour of business community shall help in the regularization of stressed assets and improving the overall asset quality of the bank.”

Sounding optimism for the future in the near term, the CMD stated, “We don’t foresee any major slippages during the current fiscal. Besides, the special provisions of around Rs 300 crore made in terms of RBI’s COVID19 regulatory guidelines expected to be released soon shall further improve the profitability in the current FY. The efforts made by the bank have started reaping benefits as is evident from the bank’s profitability, though modest, achieved in the first Q1 FY2020-21.”

Regarding the process of capital augmentation, the CMD said that the Bank is in the process of augmenting its capital base by raising additional Rs 4500 Crore, which would support the bank’s growth over the next few years besides meeting regulatory capital requirements.

Speaking about few of the decisions with far-reaching consequences for the bank, Chairman asserted, “Implementation of RTI Act and CVC guidelines has been a major step taken by your Bank aiming at further strengthening the corporate governance and accountability framework of your bank thereby enhancing transparency and efficiency as the flagship company in the UTs of J&K and Ladakh. These measures have helped in streamlining the processes and making this institution stronger and healthier going forward.”

Extending gratitude to all the stakeholders i.e. UT Government, shareholders, bank staff and customers, the CMD said, “On behalf of my colleagues on the Board of Directors, I would like to thank each member of the J&K Bank family for their hard work and commitment. I thank our promoters, the Government of UT of J&K for lending their unflinching support. Thanks to our valued customers, the Government of UT of Ladakh and shareholders for the continuing faith in J&K Bank”, adding, “We look forward to continuing this journey with you to take J&K Bank to greater heights.”

Earlier, the Company Secretary Mohammad Shafi read out the Auditor’s Report, comments from Comptroller and Auditor General (C&AG) besides providing background for business items to be transacted at the AGM.

Towards the end of the meeting, a question-answer session was held, wherein the CMD responded to different queries to the satisfaction of the shareholders. At the end of the meeting, the CMD expressed his heartfelt gratitude to all the e-participants in the AGM for their active participation. Meanwhile, the results of e-voting along with the scrutinizers report shall be available on the website of the bank and communicated to stock exchanges and KFin Technologies within 48 hours of the conclusion of AGM.

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Banking Strategy: The Road Ahead



Banking Strategy Road Ahead


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Young Kashmiri banker winsThe essence of any business or industry sector lies in constant change and improvement. This demands to be done in the technology, business model, business policy and strategy and several distinct aspects. Banking is no oddity. This industry has faced multiple setbacks in the recent past. Rising bad debts, cyber-frauds, ineffectual governance, dilution of kernel business and so on have crippled the sector. Consequently, the road ahead is uncertain, and the tunnel is dark. Banking strategies need a timely overhaul if we want the newest and the best avenues to open for this vast enterprise. Change in planning is needed to achieve change in profits.

A strategy is a plan. It is the overall aim of an organisation. It is a carefully crafted roadmap that may be followed to achieve the desired results and lead an organisation to the avenues of prosperity and profit. An avenue is a road we want to take to. It is the desired destination. The milestone we would want to cross. Careful planning is the key to reach the set avenues.

Keeping in view the ongoing banking scenario and the reasons behind the downfall of this great industry, let’s discuss new strategies in banking avenues. Let’s suggest, understand and choose novel strategic ideas.

1. Technology: Yes. Technological up-gradation is a plan that never gets out of fashion. Technology keeps changing like the weather. Any tech upgrade of last year is obsolete this season. Last year, we used to insert a debit card into a swipe machine to shop. This year we just wave our debit card over a POS machine, say hi to the equipment and the transaction is done. Needless to say that technology is the backbone of the banking system. The updated the technology, the better the banking. The strategies we form should adopt technology as one of the central elements of the strategic portfolio. Tech must be at the core of all strategic advancements. The strategists should think of any blueprint they want to put in on the lines of its technological specifications and doctrine. Test each strategy on the scale of technology.

It is important that we don’t remain reluctant to go for the concepts of Cognitive Technology. Cognitive Tech is the application of computers for doing those tasks that only a human being could do. These are the products of Artificial Intelligence (AI). Examples of AI that could be imposed in banking are Blockchain, Robotics and Process Automation. Blockchain is the process of systematically collecting data in blocks and giving it a chronological order and eventually obtaining insightful information. Blockchain is the same technological interface that lies at the spine of Cryptocurrency. Banks should wholeheartedly embrace these marvels of Cognitive Technology to usher new avenues.

2. Back to basics: Traditional banking was the best in terms of focus and specialisation. A banker had to appraise a loan applicant and lend. He had to accept people’s deposit. The difference between the interest earned and interest paid was his profit. As simple as that. The traditional banker was specialised in his business. Unfortunately, today, we have to lend, accept deposits, sell insurances, promote government schemes and what not. Today’s banker is caught between core business and these associated party products. A bank has been reduced to a departmental store where you find everything. And a banker has been reduced to a puppet in the hands of the administrators of social security products and owners of private insurance companies. It is the high time that banking be limited to core banking. Let’s do what we do best. We are masters of banking and not jacks of insurance trades. The model strategy would be to revisit our business model and revise what we are doing. We should go back to our basics and strengthen the basic pillars of our business in accordance with the current trends.

3. Collaborate to innovate: Today, the world has transformed. So has the business of banking. It is time to collaborate and develop networks. The strategy here would be to collaborate with FinTech companies, E-commerce marketplaces and so on. The idea is to make a shift from that traditional Brick-and-Mortar model to Banking as a Service (BAAS) model. Here, third-party financial and technological start-ups connect with banks. This is done with the help of technology, automatic linkages and collaboration. This model is promising as it is likely to offer personalised offers of various products to consumers. Nowadays, a number of banks in the advanced nations have adopted and collaborated with tech giants. This has been done under the concept of Logging as a Service (LAAS). To simply explain, LAAS is an IT architectural model wherein data and logs from different servers and sources are centrally ingested and analysed. In our discussion, logs and data from banks are collected and analysed so as to offer products to customers. This gives rise to a win-win situation for both tech firms and banks.

4. Open doors to Open Banking: In India, we have networked with Insurance companies. It gives us a commission. In many developed countries like the US, banks have been adopting the strategy of ’Open Banking’. It means linking with third-party service providers via Application Programme Interface (API). Here, customer’s data is shared with third-party service providers in a technical and systematic environment. This is of course done with the customer’s consent. Now what makes it different is the perfection in the identification of the customers’ needs. The data—comprising transaction pattern, account details, etc—is analysed and studied in such a way that the real product needs of a client are understood and proposed. It increases the chances of a sale. There is a spectrum of benefits in it: Customised offerings, Credit solutions, Futuristic Banking, Digital Agility, Wider client base and so on. Open Banking is the future of banking.

5. Alter to Attract: There was a time when Bank Deposits were the first choice when it came to investment. Today, the case is a complete opposite. Now, Bank FDs and RDs are the last choices. Mutual Funds and other investment options have diluted the attraction of Bank Deposits. It is the high time that we think of new strategies. Let’s alter our FDs and RDs in such a way that they provide better returns. We still enjoy the advantage of customer trust. These instruments are not risky. Let’s expand their returns by shaping the product bundle in contemporary ways. The strategy to open trending avenues is to make our deposits desirable investment druthers. Link them with the market like Mutual Funds or Gold Bonds. This, linked with the bank’s name, would make them a prefered investment choice and ensure competent returns.

6. Secure everything and everyone: Cyber Security issues, fraudulent transactions, skimming, phishing, calling scams and newest assaults have been robbing people of their hard-earned money. Cyber breaches are harsh actuality. Although, banks have been borrowing every trick in the bag to prevent it, but there has been not a hundred per cent success. It is required that cybersecurity is given all the more significance. No other strategic avenue is going to help unless and until security issue is resolved once for all.


Banking is such a vast industry. The need of the hour is to change the strategies and open new avenues. Being technically relevant, partnering with others, ensuring cybersecurity, switching to APIs, BAAS and LAAS, revisiting our core products, embracing Open Banking and making our investment options attractive, are the keys to unlock the avenues of business and prosperity.

The author is MBA, NET, IBPS. He works as Manager Scale-II in the Middle Management of a reputed PSU Bank. The views are personal

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Young Kashmiri banker wins ‘Shreyas Writing Contests’



Young Kashmiri banker wins

Banking and Economy competition was organised by Canara Bank

Srinagar: Abrar Ul Mustafa, a young Kashmiri banker and author from Sanoor Kalipora of Budgam district, has brought laurels to Kashmir.

Mustafa has won second prize in English poetry and fourth in English Essay. The contest was organised by All India Shreyas, under the aegis of Canara Bank, a Public Sector Undertaking (PSU).

Mustafa won the prizes for his poem “Snow and Sorrow” and his essay “New Strategies for Banking Avenues”. The results were declared in the organisation’s Result Declaration Memo on Thursday.

Shreyas is a pan India contest organised once every year in a number of categories. Shreyas is a reputed name in the field of writing pertaining to Banking and Economics. Apart from Shreyas, Mustafa has a number of awards and accolades to his name. He writes for a number of newspapers and websites. He is one of the lead columnists of Business Kashmir.

Talking about the award, Mustafa said: “I am feeling happy and this has encouraged me to write more.”

Mustafa works in the Middle Management of Canara Bank which is the third-largest PSU bank in the country.

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CSC VLEs to collect HDFC EMIs



CSCs to collect HDFC EMIs

BK News

Srinagar, Jan 28: HDFC Bank and CSC e-Governance Services India Ltd—a Special Purpose Vehicle (CSC SPV) under the Ministry of Electronics & IT (MeitY) – Thursday jointly announced the EMI Collection Services for CSC-HDFC Bank’s Business Correspondents across the country.

This will make payments convenient for customers, who can now visit their nearest CSC, to deposit overdue. The CSC-HDFC Bank Correspondent or Village Level Entrepreneur (VLE) will match the loan account with the customers’ registered phone number to cross-check the amount payable on the system. The VLE will then provide a receipt for the amount collected and deposit the amount in the prescribed form to the bank, a statement issued by the HDFC said.

The announcement was made by Dr Dinesh Kumar Tyagi, MD, CSC e-Governance Services India Ltd., Dinesh Luthra, National Head, CSC Channel at HDFC Bank and Debjyoti Datta, Head-Collection Process (Retail Portfolio Management) at HDFC Bank.

Speaking on this partnership, Dr Dinesh Tyagi, MD, CSC e-Governance Services India Ltd said, “We are very happy to announce the extension of our partnership with HDFC Bank and believe that CSC and HDFC Bank together can transform the delivery of financial services to rural India. With the launch of the EMI Collection facility through CSC, customers need not visit bank branches and can instead deposit the EMI through CSC, thus saving time. It will also ensure the extension of financial services to citizens in rural and far-flung areas of the country.”

Speaking on this partnership, Dinesh Luthra, National Head, CSC Channel HDFC Bank said, “We are proud to partner with CSC for this initiative. It ties with our ongoing social programmes which straddle with promoting financial literacy, financial inclusion and income-generating skills at the bottom of the pyramid. Under the initiative, CSC and HDFC Bank will work towards utilizing the services provided by the Business Correspondents for collecting regular EMIs/overdue amount on loans taken by customers. The business correspondents would act as deposit points for customers of HDFC Bank from segments like an auto loan, two-wheeler loan, personal loan, business loan and sustainable livelihood initiative.”

HDFC Bank partnership with CSC will take banking and financial services to the doorsteps of people living in remote areas through the bank’s network of over 1 lakh VLEs. The VLEs will be supported by HDFC Bank’s branch distribution network which is present in more than 30 states. The arrangement will provide access to formal banking to lakhs of people in rural India.

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