The Finance Ministry has notified the formation of Kerala Gramin Bank by amalgamating South and North Malabar Gramin Banks, the two regional rural banks in the State.
The newly formed bank comes into existence with effect from July 8, according to a Government of India Extraordinary Gazette Notification.
The command area of the new bank will be the combined operational area of the two erstwhile RRBs (all the 14 districts of the State).
The headquarters of the new bank will be at Malappuram and it is sponsored by Canara Bank.
The KGB will have a total net worth of Rs 471.58 crore and 504 branches. It has deposits of Rs 7,266 crore and advances of Rs 7,761 crore, with a total business of Rs 15,027 crore and a C-D ratio of 107 per cent.
According to K.V. Shaji, Chairman, Kerala Gramin Bank, the amalgamation would result in economies of scale in operation, improved outreach and strengthening of the bank to contribute better to the development of the area served by it.
The shareholding pattern of Kerala Gramin Bank will continue to be along the lines of the earlier model with the Centre having 50 per cent, Canara Bank 35 per cent and the Kerala Government 15 per cent.
Canara Bank, the sponsoring bank, has initiated all measures to ensure a smooth amalgamation process.
Kerala Gramin Bank will ensure protection of the interest of the depositors and borrowers and they would be able to operate their existing accounts in the newly formed entity as before, he said.
Customers with cheque book facility can continue to use their existing cheque books till all the cheque leaves are exhausted.
The Chairman requested customers to continue to extend cooperation and support to enable the bank to emerge a stronger and vibrant rural financial institution.