The A.P. Mahesh Co-operative Urban Bank is leading Urban Cooperative bank of Andhra Pradesh with a presence in the far-flung areas of the state. It caught media attention on the eve of launch of its own ATM Card recently.
The year 2012 being the international year of cooperative as declared by United Nations, Indian Cooperative decided to celebrate the success of cooperative institutions by interviewing the Chairman of Mahesh Bank, the dynamic Mr Ramesh Bung. This is our time as the ICA contributor said once, signalling the onset of IYC 2012.
Institutions are built around individuals and Mr Bung’s contribution in making Mahesh Bank where it stands today could hardly be overstated.
Q What is the scope of the ATM Card launched by Mahesh Bank?
Ramesh Bung: The customers can access their accounts and withdraw cash any time anywhere in India through 88,000+ ATMs of various banks under NFS.
Q How many branches are likely to be opened in the Year of International Co-operative Year and would there be an increase in the dividend for members?
RB We are opening three more branches in twin cities of Hyderabad & Secunderabad taking out branch network to 39 by March’12. We are also proposing to open 4 more branches in 2012-13 at Surat (Gujarat), Bhilwara (Rajasthan), Nagole (Hyderabad) and Medchal (Suburbs of Hyderabad).
The issue of dividend would entirely depend upon the profit earned for the year, allocations to be made to various funds & reserves and the recommendation of the Board.
Q RBI requires that UCBS are registered with RBI instead of State Govts. What is the take of the Mahesh Bank on this?
RB: This would be an advantage as RBI can take immediate and necessary measures whenever and wherever required, as is being done in case of Commercial banks.
Q Why is it that Co-operative Banks are constantly being punished by RBI across India? Has your bank ever been punished?
RB: Only the erring banks are being punished. Again the bank could be erring due to incorrect interpretation of the RBI guidelines. NO, our bank has never been punished by RBI.
Q Malegam Report on Licencing of UCBs is recommending for separate Committees viz. Board of Directors & Board of Management. Will this complicate the operations of the Bank?
RB: Establishing two power centres is likely to result in co-ordination problem resulting in delay in decision making which in turn would affect capitalizing the opportunities for the development of the bank.
Since the present set up of BoD and MD&CEO supported by staff is working satisfactorily in co-operative Banking sector, the status quo may be continued.
Q Do you support Direct Tax Code?
RB: Unless the bill is finalised, we really cannot comment on the same.
Q Do you favour reducing income tax on co-operative banks and societies to the pre 2006 level as demanded by many?
RB: Yes. Because co-operatives are formed to help the members of the society and not with a profit motive as is the case of commercial banks/ establishments.
Hence, they should not be subject to Income Tax provisions. However, in case that cannot be considered, IT at concessional rates should be considered.
Q Does Mahesh Bank has any plan to apply for All India License on the lines of Saraswat Bank
RB: Once we establish ourselves in the States of Rajasthan, Gujarat & Maharashtra, we have definite plans to expand the area of operations to other states and eventually to entire country.
Q How is Mahesh bank celebrating or contributing to International Year of Co-operatives?
RB: We are conducting the programs throughout the year as suggested by the Department of Co-operation, Govt. of A.P. We have road shows, training programs and many such things in the pipeline. A separate team has been formed to plan and execute IYC celebrations.