Central Bank Will Close Down 600 Branches Soon
Of the total of Central Bank’s 4,528 branches which were there at the end of March 2022, the bank is now planning to reduce the number of these branches by 600; literally 13 per cent of the total. They formal news is that the bank intends to either shut or merge the loss-making branches by the end of March 2023.
It has slashed its tally of branches by 186 between April 2017 and December 2021; but isn’t sure as to how many it should close in the current financial year. This figure remains undecided.
The bank is in the Reserve Bank of India’s PCA (prompt corrective action) regime due to its high net NPA and a negative return on assets, since June 2017.
“It is reported in press/ media regarding closure of branches by Central Bank of India. We hereby inform that there is no decision as of now to close a large number of branches during FY 2022-23,” the lender has said in the statement over the weekend.
An official statement from the bank does say that Central Bank of India, does such an exercise of re-alignment, shifting, merger, closure or opening branches on regular basis to achieve corporate business objectives.
According to Mr. M.V. Rao, MD and Chief Executive of the bank, said the lender is complying with the PCA parameters and will submit audited results to the RBI. It will also make a request to the RBI to move out of the PCA regime.
The bank’s NII during the March 2022 quarter jumped 59.43 per cent to Rs 2,417 crore, against Rs 1,516 crore a year ago. Provisions fell by 42.09 per cent to Rs 1,150 crore in Q4 of FY22 from Rs 1,986 crore in Q4 of FY21. Provision coverage ratio (PCR) improved from 82.54 per cent to 86.69 per cent. Its asset quality improved with a decline in gross non-performing assets (gross NPAs) to 14.84 per cent in March 2022 from 16.55 per cent a year ago. Net NPAs stood at 3.97 per cent in March 2022, down from 5.77 per cent a year ago.