KVG Bank prepares roadmap to reduce bad loans

Karnataka Vikas Grameena Bank (KVG Bank) has prepared a roadmap to reduce non performing assets (NPAs) and has set a target of achieving a level of 1 per cent (NPAs) to total advances by the end of this financial year.

According to Mr C. Sambasiva Reddy, Chairman, KVG Bank, “We plan to focus on bad debt management for reducing the NPAs.”

The bank has taken the initiative based on recommendations relating to reforms in banking sector made by the Boston Consulting Group (BCG), in a report ‘Being Five Star in Productivity: Roadmap to Excellence in Indian Banking'.

The bank, at its regional/senior managers' meet held at Dharwad on Thursday reviewed the important areas relating to business growth, customer services, bad debt management, and operational excellence.

Looking into the agricultural environment of the nine districts of its operational area, all the branch managers were advised to contact the farmers for repayment since the harvesting season is coming to an end.

Loan rescheduling

Mr Reddy also said that, farmers' loan account will be re-phased or re-scheduled in those taluks declared as drought affected.

While reviewing the function of recovery counselling centres started by the Bank, Mr Reddy said the centres have been successful in counselling the borrowers, especially defaulters. Teams consisting of 6 to 10 members in each cluster have already conducted camps at the villages of 180 branches.

“Such groups have contacted nearly 5,000 borrowers and were able to recover Rs 5 crore under NPAs. So far, we have settled 1,614 OTS (one-time settlement) cases involving an amount of Rs 9.35 crore,” Mr Reddy added.

anil.u@thehindu.co.in