The Telegraph
Tuesday , July 22 , 2014
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BoM to lend more to medium, small units

Sushil Muhnot in Calcutta on Monday. Picture by Kishor Roy Chowdhury

Calcutta, July 21: Bank of Maharashtra plans to lend more to micro, small and medium enterprises (MSME) and companies in the infrastructure sector this fiscal.

Sushil Muhnot, chairman and managing director of Bank of Maharashtra, said the lender had registered a 33.74 per cent growth in credit flow to the MSME sector last year and is eyeing a similar growth rate this year.

“Every year, there has been growth in MSME funding and we expect similar growth this year,” Muhnot said on the sidelines of a session at the banking conclave organised by Ficci.

He said credit flow to the MSME sector can be increased as public sector enterprises were procuring more from small-scale industries.

Muhnot said the bank was upbeat about increasing its infrastructure portfolio to around 17 per cent this fiscal from the present 14.39 per cent at the end of March 2014.

To increase the flow of bank credit to the infrastructure segment, the Reserve Bank of India has exempted long-term bonds used for funding such projects from the maintaining the cash reserve ratio and the statutory liquidity ratio.

Muhnot said the bank expects to launch such long-term infrastructure bonds in the next six months. The bonds would be having a minimum maturity period of seven years.

Muhnot is confident that non performing assets in its infrastructure portfolio, especially in power and roads, could be salvaged with good government policies.

Canara Bank

Canara Bank today reported a marginal 1.86 per cent increase in net profit at Rs 806.86 crore in the first quarter ended June 30 on higher provisioning. The bank had reported a net profit of Rs 792.07 crore a year ago.