Srinagar: The Jammu and Kashmir Bank has hiked its prime lending rate (PLR) by 50 basis points to 14.5 per cent new rates would be put in effect from August 1, 2008.
After the RBI's (Reserve Bank of India) hikes in repo and CRR, "we had to go for PLR hike," said Chief Executive of the bank, Dr Haseeb A Drabu.
According to him the hike would not affect much to customers having long-term loans with the bank. "Long term loans like housing and auto loans, won't get affected as it is spread over longer durations," he adds.
Dr Drabu told Greater Kashmir on Friday that PLR hike would affect the short term business lending like small and medium enterprises and agri-lending. "The PLR hike has been done to give us the headroom to hike deposit rates," he adds.
The bank at present has portfolio of Rs 11,000 crore in Jammu and Kashmir alone. The short-term lending portfolio of the bank is over Rs 2000 crore, which going to get affected, said Dr Drabu.
Earlier the bank had raised PLR by 1 per cent in June to 14 per cent. In the recent review of the credit policy, the Reserve Bank of India, central bank of the country, increased the repo rate, the rate at which the RBI lends overnight to banks by 50 basis points and CRR (Cash Reserve ratio), proportion of bank's deposits that they have to set aside with the central bank by 25 basis points while leaving the reverse repo rate unchanged, bringing the current repo rate and CRR to 9 per cent.
Earlier the bank has posted an impressive Rs 94.56 crore net profit for the first quarter of the current fiscal marking an increase of 14 per cent over the corresponding period of the previous year. The bank's operating profits have gone up by 38 per cent at Rs 181.50 crore.
The total business turnover increased to Rs 48,579 crore in Q1 FY08-09, an increase of 15 per cent over the corresponding period of the previous year. The loan book as on June 30, 2008 stood at Rs 20075 crore up 15.7 per cent from last year's Rs 17351 crore.
As on June 30, 2008 bank's deposit base has stood at Rs 28504 crore from Rs 24744 crore a year back registering an increase of 15.2 per cent.
"The yield in J&K was better than that from the rest of India," he said adding the yield in the Himalayan state was 14 percent against 9.5 percent for the rest of India.
The JKB has earlier posted a net annual profit of Rs 360 crore in 2007-08, which is 31 per cent up from the profits recorded in 2006-07.
Other banks which have raised its PLR are central bank of India, IDBI Bank, Yes Bank, Bank of Rajasthan, PNB, and Axis bank.
After the RBI's (Reserve Bank of India) hikes in repo and CRR, "we had to go for PLR hike," said Chief Executive of the bank, Dr Haseeb A Drabu.
According to him the hike would not affect much to customers having long-term loans with the bank. "Long term loans like housing and auto loans, won't get affected as it is spread over longer durations," he adds.
Dr Drabu told Greater Kashmir on Friday that PLR hike would affect the short term business lending like small and medium enterprises and agri-lending. "The PLR hike has been done to give us the headroom to hike deposit rates," he adds.
The bank at present has portfolio of Rs 11,000 crore in Jammu and Kashmir alone. The short-term lending portfolio of the bank is over Rs 2000 crore, which going to get affected, said Dr Drabu.
Earlier the bank had raised PLR by 1 per cent in June to 14 per cent. In the recent review of the credit policy, the Reserve Bank of India, central bank of the country, increased the repo rate, the rate at which the RBI lends overnight to banks by 50 basis points and CRR (Cash Reserve ratio), proportion of bank's deposits that they have to set aside with the central bank by 25 basis points while leaving the reverse repo rate unchanged, bringing the current repo rate and CRR to 9 per cent.
Earlier the bank has posted an impressive Rs 94.56 crore net profit for the first quarter of the current fiscal marking an increase of 14 per cent over the corresponding period of the previous year. The bank's operating profits have gone up by 38 per cent at Rs 181.50 crore.
The total business turnover increased to Rs 48,579 crore in Q1 FY08-09, an increase of 15 per cent over the corresponding period of the previous year. The loan book as on June 30, 2008 stood at Rs 20075 crore up 15.7 per cent from last year's Rs 17351 crore.
As on June 30, 2008 bank's deposit base has stood at Rs 28504 crore from Rs 24744 crore a year back registering an increase of 15.2 per cent.
"The yield in J&K was better than that from the rest of India," he said adding the yield in the Himalayan state was 14 percent against 9.5 percent for the rest of India.
The JKB has earlier posted a net annual profit of Rs 360 crore in 2007-08, which is 31 per cent up from the profits recorded in 2006-07.
Other banks which have raised its PLR are central bank of India, IDBI Bank, Yes Bank, Bank of Rajasthan, PNB, and Axis bank.
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