123

Appendix A

List of DCCBs in Haryana

1. Ambala Central Co-operative Bank Ltd.

P.B.No.322

Court Road

Ambala City

Ambala - 134 002

2. Bhiwani Central Co-operative Bank Ltd.

P.B.No.2, Uttam Bhavan

First Floor

Loharu road

Bhiwani – 127 021

3. Faridabad Central Co-operative Bank Ltd.

Plot No.52-53

Industrial Area

NIT Faridabad

Adarsh P.O.

Faridabad - 121 001

4. Gurgaon Central Co-operative Bank Ltd.

Jai road

Civil Road

Civil Lines

Gurgaon - 122 001

5. Hissar District Central Co-operative Bank Ltd.

Central Co-operative Bank Building

Railway Road

Dist. Hissar

Hissar - 125 001

6. Jind Central Co-operative Bank Ltd.

Kothi No.1218

Urban Estate

Main Post Office

Godhra Road

Jind - 126 101

7. Kaithal Central Co-operative Bank Ltd.

P.B.No.12

Kaithal Mandi

Jind road

Kaithal - 136 027

8. Karnal Central Co-operative Bank Ltd.

P.B.No.27

D.C.C.Bank Building

Ground Floor

P.O.Karnal

The Mall

Karnal - 132 001

124

9. Kurukshetra Central Co-operative Bank Ltd.

P.B.No.17

At and P.O.Kurukshetra

Goal Bank Bldg

G.P.O., Railway Road

Kurukshetra - 136 118

10. Mahendragarh Central Co-operative Bank Ltd.

Railway Road

At and P.O.Mahendragarh

Mahendragarh - 123 029

11. Panchkula Central Co-operative Bank Ltd.

S.C.O.-60

Sector - 6

At and P.O. Panchkula

Panchkula - 134 109

12. Panipat Central Co-operative Bank Ltd.

P.B.No.107 ( With H.P.O. )

H.No.535-R

Near Pruthi Chowck

Model Town

Ground Floor

Panipat - 132 103

13. Rewari Central Co-operative Bank Ltd.

Rewari Floor

Circular road

G.P.O., Mohindergarh

Rewari - 123 401

14. Rohtak Central Co-operative Bank Ltd.

P.B.No.43, Co-op. Bank Building

Ground Floor

Rohtak - Delhi Road

G.P.O. Rohtak

Rohtak - 124 001

15. Sirsa Central Co-operative Bank Ltd.

P.B.No.4

Skylark Building

Dabwali Road

Navy Mandi

Sirsa - 125 055

16. Sonepat Central Co-operative Bank Ltd.

P.B.No.36

Main Post Office

Tikaram Road

Sonepat- 131 001

125

17. Yamuna Nagar Central Co-opertive Bank Ltd.

P.B.No.19

Kothi No.8-9

Professor Colony, Yamuna Nagar

Sarojni colony

Bye-Pass Road

Yamuna Nagar- 135 001

18. Jhajjar Central Co-operative Bank Ltd.

New Mini Secretariat Building, Gurgaon Road

Jhajjar

19. Fatehabad Central Co-operative Bank Ltd.

Head office

Behind SBI, Anajmandi

Fatehabad

126

APPENDIX B

List of Basic Data of DCCBs in Haryana 2002-2011

Table 1 Owned Funds (Share Capital +Reserve) of District Central Co-operative

Banks in Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala

1444 1720 2152 2152 2834 3114 3289 3304 3110 3110 Bhiwani

1211 1974 2106 1728 2233 2347 2907 3125 3546 3661 Far/bad

1502 1618 2683 2986 3443 3053 3371 3509 4011 5470 Fate/bad

1068 1327 1854 2095 2254 2254 2254 945 2706 2995 Gurgaon

1891 2957 2934 3817 4550 4212 4385 4896 4975 5044 Hissar

2103 2292 2985 4047 5281 5728 5560 6958 8225 9103 Jhajjar

957 1008 1482 1008 2352 2623 2686 2982 2982 4217 Jind

1240 2342 1591 1637 2150 2556 2402 2136 2786 2922 Kaithal

1628 1745 2223 2275 2574 2574 3052 3120 3200 3211 Karnal

2184 3355 3643 4149 4549 5498 5586 5173 5173 6030 Kurk/tra

1225 1724 1676 2294 2453 2931 2983 3109 3109 3839 M.Garh

1321 1371 1684 1707 2072 2072 2072 2072 2543 2529 Panchkula

560 1001 1026 1236 1236 1141 1742 1836 2071 2146 Panipat

1161 2095 2610 3014 3641 3920 4761 5040 5517 5809 Rewari

904 1477 1463 1947 2308 2308 2308 2513 2733 1992 Rohtak

1048 1118 1511 1516 1581 3003 3051 3189 3216 3431 Sirsa

1354 2083 1561 3033 2492 2863 3276 3276 2916 2920 Sonepat

1490 1605 2233 2730 2838 2838 2894 3119 3268 3298 Yamu/nagar

1250 1291 1856 2184 2365 2659 2879 3313 3738 4448

127

Table 2 Borrowing of District Central Co-operative Banks in Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala

5716 7176 7094 8921 10279 11611 13011 7710 7191 9850 Bhiwani

9987 10050 12492 12351 15283 17724 18470 13820 15577 18470 Far/bad

9333 9915 11219 11361 9884 14613 18377 16305 14589 18977 Fate/bad

12299 12275 12415 13209 16340 19621 21375 22259 21773 23487 Gurgaon

5298 5791 5380 4121 4712 11802 12084 12700 11371 14048 Hissar

8426 11199 11137 14938 21257 25091 28417 28170 25716 29811 Jhajjar

4417 4345 4062 5065 3084 5346 8722 8903 10600 13000 Jind

11651 12483 14161 15192 15585 17122 17418 15890 15903 19800 Kaithal

11999 14016 14850 14717 16229 18452 22522 19708 19139 24857 Karnal

17029 18266 18128 21246 21577 24930 31633 28167 24712 36932 Kurk/tra

10865 10758 9904 10382 12392 12591 20741 14892 14194 20949 M.Garh

6010 5821 6273 6285 8764 10101 9595 8571 8049 7610 Panchkula

3255 3656 4670 4983 4650 15225 6061 5684 5655 6700 Panipat

7884 10798 11136 13937 14685 16688 18831 17308 16099 21568 Rewari

4133 4570 4039 4284 4741 4792 7200 7518 8587 9837 Rohtak

6951 5053 4310 2885 1044 6204 8128 6006 7209 11707 Sirsa

12871 13562 12038 14614 15663 16998 19170 16366 16081 19297 Sonepat

10085 12732 15837 14360 12957 15702 15767 9923 11253 16725 Yamu/nagar

7188 8037 7932 10035 11157 11571 13002 11988 11015 12296

128

Table 3 Investment of District Central Co-operative Banks in Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala 3485 3562 3671 4252 4839 4658 6203 7303 9956 9288

Bhiwani 6018 5295 7886 7389 6692 7249 8424 10624 16681 17946

Far/bad 3138 3268 3883 3927 6351 8752 7357 8631 9572 10459

Fate/bad 1280 1453 1696 1767 1836 1919 2256 3155 3736 4254

Gurgaon 4245 4053 4721 6110 16690 23191 28320 29220 32189 50248

Hissar 4881 5334 5926 6033 6459 6175 7577 10955 10405 10545

Jhajjar 2070 2366 2856 3079 4429 5223 5963 9263 8833 10771

Jind 1919 2136 2500 2691 2940 3506 3626 4131 4666 5465

Kaithal 1723 1924 2255 2478 2808 2914 3643 4188 5100 5876

Karnal 2725 3080 3087 4001 4838 5623 6457 9082 9096 9997

Kurk/tra 2565 2940 3290 3554 3810 3842 3975 4169 5117 7368

M.Garh 1527 1677 1909 2014 2127 2450 2522 3109 6633 5989

Panchkula 1450 1870 1879 1879 2412 3669 3836 3688 4073 5109

Panipat 2031 2406 4681 3022 3478 3855 4418 6298 7197 7022

Rewari 2589 2302 2720 2875 3226 4935 5407 7897 6767 6446

Rohtak 2629 3349 4303 4183 4403 5969 8911 11482 14794 18243

Sirsa 1506 1838 2228 2361 2507 2918 2880 3334 3874 4601

Sonepat 2691 3028 3228 3357 3718 3894 4652 7239 3241 10585

Yamu/nagar 3425 2923 3188 3947 4015 4250 4678 6603 6995 7431

129

Table 4 Deposit of District Central Co-operative Banks in Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala

9805 10755 12205 12205 14156 15201 17920 20647 24336 24336 Bhiwani

17185 19852 22372 22394 24659 25745 30750 37123 43448 45183 Far/bad

10394 12433 14597 14637 19816 21348 18532 20706 24756 26298 Fate/bad

4582 5647 5921 6233 5985 5985 5985 9271 11237 11073 Gurgaon

14308 14691 17950 23531 36051 36509 42837 42252 48436 67787 Hissar

18513 21768 22844 22862 22934 23098 27621 33148 38149 37569 Jhajjar

7624 9000 10468 9000 16129 19839 20068 24344 24344 28694 Jind

6696 7963 9264 9660 10455 12450 13773 14539 17517 18872 Kaithal

6588 7332 8379 8640 9719 9719 12036 14258 16035 16952 Karnal

9417 10697 11570 13320 15277 15393 18339 21253 21253 28868 Kurk/tra

8983 10874 13229 13426 13343 13611 14375 15205 15205 22366 M.Garh

5699 6701 7394 7311 8047 8047 8047 8047 13391 13681 Panchkula

5280 5280 6540 6450 6450 8811 10494 10489 11728 14806 Panipat

7363 8143 9143 10349 10728 12111 12579 14946 19365 18846 Rewari

7064 8586 10153 10154 11995 11995 11995 17399 20048 21537 Rohtak

10075 13215 16886 15474 15926 15974 21903 23906 25637 32588 Sirsa

4474 5582 7002 7386 8611 9179 10152 10152 14491 16044 Sonepat

10457 11835 12760 13023 14369 15113 17777 22409 24443 24664 Yamu/nagar

9981 11044 11964 12145 13980 13522 15255 17766 21500 23324

130

Table 5 Credit of District Central Co-operative Banks in Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala

12777 15652 17206 17206 21625 24247 25883 23708 23268 23268 Bhiwani

22476 25032 28127 29841 35254 38534 42393 42965 43323 45371 Far/bad

19066 21253 23986 24725 26841 30388 32976 32915 35190 40658 Fate/bad

16202 18119 18216 19973 23600 23600 23600 31202 27002 33744 Gurgaon

18321 19428 21694 25229 28267 28811 30017 29595 31658 34451 Hissar

23160 28386 28927 33134 39962 44524 50401 51690 53213 56526 Jhajjar

11260 12617 13260 12617 16737 21541 25059 28856 30640 33226 Jind

17128 19063 21976 22964 24406 27493 28539 28488 28812 33958 Kaithal

18443 21319 22984 22995 25599 25599 33613 32092 33488 38865 Karnal

26531 28600 29864 34489 36171 39606 47205 45088 45597 59131 Kurk/tra

18125 20253 21330 20972 22810 24492 31759 27928 27869 37105 M.Garh

11127 11867 13222 13424 13425 13425 13425 13425 17156 17371 Panchkula

7443 7442 10305 10511 10511 21821 14018 13637 14165 16791 Panipat

15352 18917 20271 24347 25668 29169 30879 30731 32509 38261 Rewari

9538 11450 12010 12011 14943 14943 14943 185 22644 21397 Rohtak

15489 16076 18168 15738 14448 17971 23078 19018 20268 27552 Sirsa

16294 18594 18760 21456 24417 25627 27955 27955 27390 30355 Sonepat

19406 23055 27594 26292 26199 29307 31591 28177 27512 27512 Yamu/nagar

14933 17130 18164 20157 23115 23218 25214 26033 27254 30109

131

Table 6 Business (Deposit + Credit) of District Central Co-operative Banks in

Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala 22582 26407 29411 29411 35781 39448 43803 44355 47604 47604

Bhiwani 39661 44884 50499 52235 59913 64279 73143 80088 86771 90554

Far/bad 29460 33686 38583 39362 46657 51736 51508 53621 59946 66956

Fate/bad 20784 23766 24137 26206 29585 29585 29585 40473 38239 44817

Gurgaon 32629 34119 39644 48760 64318 65320 72854 71847 80094 102238

Hissar 41673 50154 51771 55996 62896 67622 78022 84838 91362 94095

Jhajjar 18884 21617 23728 21617 32866 41380 45127 53200 54984 61920

Jind 23824 27026 31240 32624 34861 39943 42312 43027 46329 52830

Kaithal 25031 28651 31363 31635 35318 35318 45649 46350 49523 55817

Karnal 35948 39297 41434 47809 51448 54999 65544 66341 66850 87999

Kurk/tra 27108 31127 34559 34398 36153 38103 46134 43133 43074 59471

M.Garh 16826 18568 20616 20735 21472 21472 21472 21472 30547 31052

Panchkula 12723 12722 16845 16961 16961 30632 24512 24126 25893 31597

Panipat 22715 27060 29414 34696 36396 41280 43458 45677 51874 57107

Rewari 16602 20036 22163 22165 26938 26938 26938 17584 42692 42934

Rohtak 25564 29291 35054 31212 30374 33945 44981 42924 45905 60140

Sirsa 20768 24176 25762 28842 33028 34806 38107 38107 41881 46399

Sonepat 29863 34890 40354 39315 40568 44420 49368 50586 51955 52176

Yamu/nagar 24914 28174 3018 32302 37095 36740 40469 43799 48154 53433

132

Table 7 Profit of District Central Co-operative Banks in Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala 174 315 350 350 200 -344 -821 954 954 119

Bhiwani 27 35 259 337 1071 -160 17 43 43 687

Far/bad 173 68 143 329 1136 133 41 140 140 27

Fate/bad 280 104 217 134 115 115 115 64 64 6

Gurgaon 83 63 102 107 305 -257 146 358 358 29

Hissar 105 -173 361 86 -229 -745 -724 -910 -910 -2344

Jhajjar 288 410 441 410 245 104 106 110 110 22

Jind 88 -169 92 79 -197 -853 -110 708 708 -530

Kaithal 71 55 262 6 32 32 140 43 43 10

Karnal 441 171 488 745 34 208 32 106 106 62

Kurk/tra 312 271 449 244 123 14 -614 1 1 -392

M.Garh 145 166 311 331 133 133 133 133 34 15

Panchkula 75 75 159 48 48 48 -15 15 15 63

Panipat 300 294 470 518 373 116 70 81 81 113

Rewari 100 125 150 150 187 187 187 7 7 3

Rohtak 301 310 597 467 206 54 74 78 78 54

Sirsa 10 251 431 262 54 13 -218 -218 -218 -617

Sonepat 61 67 178 213 18 -40 82 171 171 19

Yamu/nagar 234 157 336 158 70 -109 212 114 114 -869

133

Table 8 Employee of District Central Co-operative Banks in Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala 299 300 289 300 278 266 255 255 255 255

Bhiwani 396 212 372 361 188 336 339 339 306 286

Far/bad 291 288 275 260 249 234 229 229 183 178

Fate/bad 260 260 254 204 117 117 117 233 210 207

Gurgaon 349 338 328 315 305 289 313 257 288 271

Hissar 502 303 497 486 480 452 450 423 401 374

Jhajjar 210 212 209 212 207 207 194 187 187 160

Jind 342 332 327 201 189 181 322 300 286 256

Kaithal 305 322 298 292 181 181 257 242 225 205

Karnal 382 247 368 249 225 226 265 192 192 411

Kurk/tra 317 310 300 307 184 288 273 254 254 226

M.Garh 207 202 193 191 198 198 198 198 149 136

Panchkula 108 109 101 104 104 104 100 108 108 98

Panipat 203 131 203 125 121 183 173 163 117 113

Rewari 241 148 226 144 142 142 142 183 171 161

Rohtak 221 211 201 208 205 208 189 193 157 139

Sirsa 414 226 411 232 223 398 373 373 373 305

Sonepat 327 322 315 308 301 297 276 246 246 211

Yamu/nagar 280 273 271 262 152 233 211 197 180 158

134

Table 9 Branch of District Central Co-operative Banks in Haryana: 2002-2011

Name of the

Bank

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ambala 15 19 15 19 19 20 30 30 30 30

Bhiwani 25 25 25 25 25 25 25 39 39 39

Far/bad 23 24 23 24 24 24 28 33 33 33

Fate/bad 15 16 15 16 16 16 16 30 30 30

Gurgaon 16 21 16 21 20 20 39 39 39 39

Hissar 25 26 25 27 27 27 47 47 47 47

Jhajjar 17 18 17 18 18 18 25 25 25 25

Jind 22 24 23 24 24 34 34 34 34 34

Kaithal 22 24 24 24 24 24 24 30 30 30

Karnal 24 25 25 27 28 28 46 47 47 47

Kurk/tra 19 22 19 22 22 22 41 39 39 39

M.Garh 12 13 13 14 14 14 14 14 23 23

Panchkula 8 10 8 9 9 10 13 13 13 13

Panipat 13 13 15 15 15 16 22 23 23 23

Rewari 15 15 15 15 15 15 15 28 28 28

Rohtak 14 14 14 14 15 15 24 24 25 25

Sirsa 28 28 28 29 29 42 42 42 42 42

Sonepat 19 20 20 21 21 21 36 36 36 36

Yamu/nagar 16 20 16 20 20 20 35 35 35 35

135

PROFITABILITY OF DISTRICT CENTRAL CO-OPERATIVE BANKS: A CASE

STUDY WITH BURDEN-COVERAGE ANALYSIS

Dr.Neelam Choudhary

Professor

Department of Economics,

M.D. University, Rohtak

&

Dal Singh

Ph.D Scholar

Department of Economics,

M.D. University, Rohtak

Email:- kaushik.dalsingh@gmail.com

Abstract:

Co-operative banks especially District Central Co-operative Banks are important

components of indian financial system. In Haryana state, there are nineteen DCCBs. This

paper evaluates the performance of Rohtak Central Co-operative Bank for the period

2007-2012. Burden Coverage Ratio is used to study the profitability of the Rohtak

Central Co-operative Bank .It is found that BCR has gone down during the five years

under reference. But the quotient of BCR has even been more than one that shows safe

level of profitability i.e. it requires various feasible means profitability in particular and

overall performance in general.

Key Words: Co-operative Banks, Profitability, Profit.

136

INTRODUCTION

Co-operative banking system has a very rich network comprising various type of societies

and banks. Every person can access the available facilities of this system. Co-operative

banks have made significant progress in various sectors of Indian economy. They are well

established and have suitable mechanism to bring all segments of society into financial

inclusion in our nation (Singh, 2010). Among Co-operative credit institutions, district

central co-operative banks are very famous banking institutions. They have a link

between State Co-operative Banks and Primary Agricultural Credit Societies. They

provide various type of banking facilities in their respective regions. To provide adequate

credit for agriculture sector, they have to dwell on their performance especially the status

of profitability because in the present competitive, era the success of the whole co-

operative banking system depends upon the success of District Central Co-operative

Banks. It clears the importance of study and to analyzed the profitability of DCCBs.

There are nineteen DCCBs in Haryana at present. By adopting the inductive approach,

profitability of a bank- the Rohtak Central Co-operative Bank Ltd. is decided to be

studied due to the fact of convenience and for consulting the results with bankers

associated with this bank. Co-operative Banks are vital component of the Indian Banking

system. The co-operative banks play an important role in the Indian financial system,

especially at the village level. The Reserve Bank of India has been playing a very active

role in the formation and promotion of co-operative banks as well as support activities

extended to them. The co-operative principle of managing finance in India serve as a via

media between sophisticated institutions like modern commercial banks on the one hand

and dishonest money lenders on the other. Despite the tremendous and vast network of

commercial banks, more so of the nationalized banks, co-operative banking remains an

effective instrument of credit delivery in case of rural borrowers even to day. The main

area of operation of co-operative banks is in the agriculture and rural sector. However,

they have increased their field of operation to urban and metropolitan cities.

THE ROHTAK CENTRAL CO-OPERATIVE BANK LTD. ROHTAK

The Rohtak Central Co-operative Bank Ltd. Rohtak (RCCB) was set up on 14th

January

1914 with (under Punjab Co-operative Societies Act 1912) the area of operation of the

137

bank covers the whole district of Rohtak. The bank gives short term and medium term

loans for agriculture and non-agriculture purposes.

REVIEW OF LITERATURE

The following, researches have been reviewed by the researcher:

Jain (2001) did a comparative study of District Central Co-operative Banks (DCCBs) of

Western India, like Maharashtra, Gujarat and Rajasthan and found in his study that

DCCBs of Rajasthan have performed better in profitability and liquidity as compared to

Gujarat and Maharashtra.

Mavaluri, Boppana and Nagarjuna (2006) revealed in their study that performance of

banking in terms of profitability, productivity, asset quality and financial management is

most important for stable economy. They found that public sector banks have been more

efficient than other banks in India.

Dutta and Basak (2008) focussed that Co-operative banks should improve their recovery

performance, adopt new computerized monitoring system of loans. They also suggested

that co-operative banks improve their performance by organizing regular workshops and

implementing proper prudential norms.

Singla(2008) stressed on financial management and examined the financial position of

sixteen banks by considering profitability, capital adequacy, debt-equity.

Gupta &Jain(2012) studied co-operative banks with reference to the lending practices.

The study is based on successful co-operative banks in Delhi (India).They studied the

bank performance with lending practices provided to the customer. The customer has

taken different types of loans from the banks. Moreover, they suggested that the bank

should adopt the latest technology of the banking like ATMs, internet / online banking,

credit cards etc.

OBJECTIVE AND RESEARCH METHODOLOGY

The study aims at to analyzed the profitability of the RCCB Ltd. with a refined approach

i.e., burden-coverage analysis. This is a case study. It is analytical by nature. It is purely

138

based on secondary sources. It is carried out with induction approach. A period of five

years from 2008-12 has been taken for the analysis. Average, standard deviation and

growth rates have been used in the study.

Conceptual Framework of Burden-Coverage Analysis

The profits of a bank may be affected by various factors but the most important are

management of spread, burden and both. The inter-relationship among spread, burden and

profit is known as the Spread-Burden- Profit analysis where

Spread= Interest Income – Interest Expenditure

Burden = Man Power Expenses + Other Expenses- Non- interest Income

Profit = Spread –Burden

Over a period of time, the volume of bank business is expected to grow resulting

in a proportionate increase in the amount of spread and there by an increase in

profit. If there is a decrease in profit in spite of an increase in the volume of

business and thereby spread, it indicates poor overall operating profit ability. The

reason for this is, a more than proportionate increase in burden than in spread.

Burden Coverage Ratio (BCR):

Another way of finding out, the overall profitability of a bank is, by applying the

technique of “ Burden Coverage Ratio” where;

BCR= Spread/ Burden

If the quotient of the ratio is 1, it indicates the break even position of the bank. If

it is more than 1, it shows the operational profitability and a value of less then 1,

is a case of poor profitability.

139

ANALYSIS AND INTERPRETATION OF DATA

Table1: Interest received. and interest paid and spread of the

R.C.C.B. Ltd. Rohtak (2008-2012)

(Rs. In Lakhs)

Year Interest received Interest paid Spread

2007-08 1755.28 1105.31 649.97

2008-09 2471.46 1721.2 750.26

2009-10 2295.41 1602.26 693.15

2010-11 2526.99 1620.79 906.2

2011-12 4576.4 2692.74 1883.66

Mean 2725.11 1748.46 976.65

S.D. 1078.90 579.60 516.23

Growth

Rate(%) 161 144 190

Source: Compiled from Annual Reports of the R.C.C.B. Ltd., Rohtak, 2008-2012.

Table 1 reavels the information about interest received, interest paid and spread during

the 2008-2012 .Interest received means the amount which has taken from the debtors of

the bank and interest paid means the amount which is paid by the bank to the other

financial institutions. Spread is the difference between interest received and interest paid.

It shows that the amount of interest received has been more than the amount of interest

paid during all these five years. It means although the main objective of this bank is to

provide credit facilities to their beneficiaries through their own branches and member of

Primary Agricultural Credit societies. Yet the bank under study has earned a handsome

amount as interest. The interest received increase from Rs.1755.28 lakhs to Rs. 45796.40

lakhs with 161 percent growth rate. On an average the amount of interest received has

been Rs. 2725.11 lakhs and it is showing an increasing trend. If we see the amount of

interest paid, it is also found that it is showing increasing trend during the reference

period .It increased from Rs.1105.31 lakhs to Rs.2692.74 lakhs with 144 percent growth

rate. The average of spread is Rs.976.65 lakhs.It shows that profitability of the bank is

good and the growth rate of this variable (i.e 190 percent ) highlights the increase in the

profitability (except the year 2010) of the R.C.C.B. during the study period.

140

Table 2 : Total expenses, total income and burden of the R.C.C.B.

Ltd. Rohtak (2008-2012)

(Rs. In Lakhs)

Source:Compiled from Annual Reports of the R.C.C.B. Ltd., Rohtak, 2008-2012.

To achieve the objective in detail it is also essential to see the actual extent of man- power

expenses and other type of expenses (except interest paid) and income includes all type of

income (except interest received) which leads to the amount of burden that will provide

the scene of profitability of any banking concern. Table no.2 provides that on an average

man –power expenses plus other expenses have been Rs.1005.21 lakhs and increase from

Rs.610.88 lakhs to 1935.50 lakhs with a high growth rate i.e 217 percent But the amount

of non interest income has been very low as compare to to man-power and other

expenses .The average of this indicator is Rs.85.14 lakhs but this income has been

increasing with a remarkable growth rate during the study period (i.e 220 percent)

.Ultimately, it is found that the average of burden has been found Rs.920.07 lakhs during

the same period and it shows almost same growth rate.

Table 3: Spread, Burden and BCR of the R.C.C.B. Ltd. Rohtak (2008-2012)

(Rs. In Lakhs)

Year Spread Burden Profit BCR

2007-08 649.97 575.67 74.3 1.13

2008-09 750.26 672.4 77.86 1.11

2009-10 693.15 677.03 16.12 1.02

2010-11 906.2 852.33 53.87 1.06

2011-12 1883.66 1822.93 60.72 1.03

Mean 976.65 920.07 56.57 1.07

S.D. 516.23 514.48 24.64 0.05

Growth

Rate(%) 190 217 -18 -9

Source: Compiled from Annual Reports of the R.C.C.B. Ltd., Rohtak, 2008-2012.

Year Expenses Income Burden

2007-08 610.88 35.21 575.67

2008-09 888.19 215.79 672.4

2009-10 700.07 23.04 677.03

2010-11 891.4 39.07 852.33

2011-12 1935.5 112.57 1822.93

Mean 1005.21 85.14 920.07

S.D. 534.02 81.08 514.48

Growth Rate(%) 217 220 217

141

Burden coverage ratio is an indicator of profitability. To calculate this ratio, spread and

burden have been used. B.C.R. has been calculated to divide the spread by the burden.

Table no.3 shows that in 2009-10 amount of profit has been minimum (Rs.16.12 lakhs)

and it also shows that on an average, the profit has been Rs.56.57 lakhs with a variation of

Rs.24.64 lakhs and the growth rate is negative by 18 percent. Further the average of

B.C.R. which is 1.07 i.e. the profitability position of the R.C.C.B. ltd. has been up to

mark because more than quotient 1 depicts good level of profitability but the point of

attention is the decreasing trends in the B.C.R.( negative 9 percent) which means the

profit is continuously going down.

Conclusion:

In the era of competition, co- operative Banks are far behind than the level of other banks

like commercial banks. But they can improve their performance and services by adopting

the required set of reforms and restructuring DCCBs can play very significant role in this

concern. The level of profitability determines the present status and future prospects of

any banking institution .In the same direction, the profitability of RCCB Ltd. is analyzed

with BCR technique. The study concludes that though the profitability of the bank under

study has been at satisfactory level, it is showing decreasing trend i.e. the profitability has

been decreasing during the study period .It is a matter of concern for the RCCB Ltd. The

bank should increase the amount of spread by keeping the same level of burden. It can

increase its other incomes by rendering some other types of services like contacting with

government office for salary purpose, providing non-agricultural loans to urban people.

Very interesting point is that even employees of co-operatives get their salary through

State Bank of India, Punjab National bank etc. Infact DCCBs should be used for this

purpose. It will accelerate the extent of non interest income of the bank under study.

142

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