At a time when most banks in the country feel that lending to the agricultural sector is rather risky, Federal Bank strikes a contrarian note. The bank today said it would give lending to agriculture a big push.
“We find lending to agriculture profitable,” says Mr T.S. Jagadeesan, Chief General Manager, Federal Bank. As much as 13.2 per cent of the bank's Rs 32,000-crore advances are to agriculture.
This, he says, is particularly true in Tamil Nadu – a State where the Kerala-based bank wants to increase its activities.
Addressing a press conference here, Mr Jagadeesan said that agriculturists in Tamil Nadu were making good money. Agriculture in Tamil Nadu is not just paddy, he pointed out, noting that there were businesses such as banana cultivation and exports that were hugely profitable.
Accordingly, the bank plans to increase its presence in the agricultural belt of western and southern Tamil Nadu “in a big way”.
Asked if vagaries of monsoon did not pose a risk to the business, Mr Jagadeesan said that business other than agriculture also bore several risks.
In line with its strategy of enhancing its operations in Tamil Nadu, the bank on Tuesday opened nine branches in the State, which were among the 66 it opened across the country. Why 66? On Tuesday, the Federal Bank celebrated the 66th Founder's Day. The bank's Founder, K P Hormis, was born on October 18, 1917 in a village near Kochi and he set up the bank in 1945.