Usha Thorat underlines role of private sector banks in inclusive banking

Mangalore, Feb 20 (ANI): Emphasizing the role of private sector banks in the Indian economy, Usha Thorat, the former deputy governor of Reserve Bank of India (RBI), presently Director of the Centre for Advanced Financial Research and Training, said here that old private banks had an important role in the spread of inclusive banking in the country.

Speaking at the 88th Founders' Day celebration of Karnataka Bank Ltd here on Saturday, she said there has been a fairly steady growth in deposits and advances in old private sector banks, even though their market share has gone down, especially after 2005.

Thorat said that data on market share, growth of deposits and advances, and the average GDP figures over the last 15 years have suggested that old private banks had achieved healthy growth, by and large, in regions of the country where the growth had been higher than the national average.

"This favourable environment meant that as long as the old private banks catered to their niche segments in their traditional areas while ensuring steady growth through investing in technology and people, they were able to grow at a fairly healthy pace," she added.

Usha Thorat suggested that the old private banks should increase their customers cautiously.

"The old banks must take advantage of their knowledge of the region and the business to increase outreach and coverage in their areas," she added.

Emphasising that banks should also branch out into regions of the country, which showed good potential for growth, Thorat said that more inclusive banking will be good business while keeping concentration risk low.

The 88th foundation day was presided over by Ananthakrishna, Chairman of the Karnataka Bank. The Managing Director of the Bank, P. Jayarama Bhat, members of the Board of Directors and shareholders in large numbers attended the celebrations. (ANI)