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RBI to look into relaxation on CRAR for cooperatives

Favourable domestic factors to accelerate growth: RBI

Thiruvananthapuram: RBI has assured to look into Kerala’s request for relaxation of capital to risk-weighted assets ratio (CRAR) for cooperative banks, state Cooperation Minister Kadakampaly Surendran said today.

The state had sought relaxation in CRAR for cooperative banks for the financial year 2016-17 and RBI Governor Urjit Patel had assured the state that the issue would be looked into, he said.

RBI had directed cooperative banks to maintain a CRAR of nine per cent.

The state cooperative banks were able to achieve a CRAR of seven per cent till March last, he said in a statement.

The functioning of the cooperative banks were affected after demonetisation of Rs.1000 and Rs.500 notes in November hit their profitability, he said.

NPA of cooperative banks also increased due to fall in the repayment of loans by customers, Surendran said in his letter to the RBI Governor.

—PTI