Business OpportunitiesSBM to restructure loans of flood-hit
State Bank of Mysore (SBM) will restructure agriculture loans to the tune of Rs 1,200 crore in the flood affected districts of North Karnataka. The bank is predominant in four of the 14 districts affected by the floods.
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Dilip Mavinkurve, managing director, SBM said the bank in the process of forming special teams to assess the situation in the flood affected districts. “We have been asked by the state government to speed up the process of clearing cheques issued to the flood victims. As far as SBM is concerned, we do lot of government business and we are prepared to handle large number of cheques for clearing. We will adhere to the guidelines issued by Reserve Bank of India under the circumstances.”
The special state level bankers committee meeting held on October 15, had stressed on the speedy disposal of relief. The Bank will be converting short term crop loans into medium term loans upto 3-5 years. The Bank has set up mechanism in all the districts for the purpose, he said.
The Bank has close to 200,000 farmers on its loan books and its total agriculture loans amount to Rs 1,200 crore in these 14 districts, which is close to 50 per cent of its total agriculture credit in the country. It has around 100 branches in these districts. The bank has a strong presence in Bellary, Bagalkot, Chitradurga and Davanagere. Of this amount, at least 50 per cent may have to be restructured, Mavinkurve said.
“We have to make some provisions for restructuring. Existing interest rates will continue to be there. The crop loans are normally of short duration depending on the crop. After adjusting towards the insurance, we will work out the exact amount to be restructured,” he said.
The bank has granted waiver/relief of agricultural loans to the tune of over Rs 353 crore benefiting 110,000 farmers under the Agriculture Debt Waiver and Debt Relie Scheme announced by the Centre last year. While all the eligible farmers have been extended debt waiver under the scheme, farmers eligible for debt relief have been given time till December 31, 2009 as per the guidelines of RBI.