With the change of guard in Jammu and Kashmir Bank Limited, many revelations have come out in the public domain. The bank which is mostly in news for all “good reasons” because of the level of PR that its communication department has maintained with the local press isn’t in good health itself. During past many years, the J&K Bank- the second major source of employment is facing crisis as far as its business was concerned. The Bank, which is one of the major sources of advertisements for newspaper owners or editors doesn’t surface in any campaign done by the reporters. J&K Bank that ways is an “untouchable entity”. The Bank is not showing a steady growth. However at the same time there are many corrupt practices, which are bringing Bank to the bankruptcy stage. Currently the Bank is down by about 70 per cent. Within a year or so the bank is showing a lot of stress in its banking graph. While as Jammu and Kashmir is in the midst of financial crisis with liabilities mounting to Rs 2200 crore, the financial experts and officials here blame the previous government saying shifting to RBI’s ways and means was a mistake. The previous government’s decision “replacing J&K Bank by RBI as state’s banker is the main reason for the deteriorating financial health of Jammu and Kashmir, this is what the experts have attributed. In 2011 then state government shifted its banking operations from JK Bank to Reserve Bank of India by signing an MoU to this extent. Earlier, the state-owned JK Bank was the banker of the state which provided cushion to the state government to borrow funds from it during exigencies. But now the state government to borrow from the open market has to seek permission from RBI and give justification for any need. Even as the bank during this period had sought to boastfully project a buoyant image appearing ‘least affected’ by the problems dogging the banking industry in the country, its newly appointed CEO on Monday pierced the veil to let the truth come out. The figures dished out by him are disturbing, to say the least. The NPAs and stressed assets of the bank have together touched a whopping Rs 20,000 crore. The NPA coverage ratio of the bank, once considered one of the best in the industry, has shrunk from 94 to 50 per cent. In the face of its debilitating financial health, the bank forecasts no bottom-line growth in the current fiscal which may continue in the next financial year. Not just that, the bank’s financial health won’t be permitting it to pay dividend, have tax provision or contribute to CSR for the next at least one and a half years.
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