One of Rajasthan’s leading urban cooperative banks- Udaipur Urban Cooperative Bank Ltd. stands as a unique example in the country having consistently disbursed a 50 percent dividend to its shareholders for the past three decades.
In an exciting development, the bank plans to double its dividend, proposing a 100% payout for the financial year 2023-24. The Board of Directors has approved this proposal, which was also ratified at the Annual General Meeting (AGM).
Talking to the Indian Cooperative correspondent on the phone, Chairman, Tauseef Hussain, stated, “We have been paying a 50% dividend for many years, and for 2023-24, we aim to offer a 100% dividend. We are currently awaiting the state registrar of cooperative societies’ approval,” he said.
Hussain elaborated that most shareholders hold a modest share capital, generally less than Rs 6,000. “This makes it manageable for us to pay the proposed dividend. However, as per regulations, the maximum dividend we can distribute without additional approval is 10%. To exceed this limit, we must seek permission from the Registrar of Cooperative Societies (RCS),” he clarified.
The Udaipur Urban Cooperative Bank continues to experience strong growth, achieving a record profit of Rs 14.02 crore for the 2023-24 financial year. The Chairman shared his vision for expansion: “While our presence is currently limited to Udaipur and Rajsamand districts, my aspiration is to extend operations to more districts across Rajasthan,” he claimed.
He also mentioned the strategic emphasis laid out at the recent AGMs of the Rajasthan Federation and National Federation of Cooperative Banks, highlighting the push for contributions towards the share capital of the National Urban Cooperative Finance and Development Corporation (NUCFDC), an umbrella organization for urban cooperative banks. “We are actively considering investing in the share capital of NUCFDC,” he noted.
A distinctive feature of the bank is its tradition of leadership rotation. “We ensure that no Chairman serves two consecutive terms, promoting regular changes in the board,” Hussain emphasized.
Detailing the bank’s financial health, he added, “Our current deposits are approximately Rs 800 crore, with advances around Rs 360 crore. We aim to surpass Rs 1,000 crore in deposits. Our Capital to Risk-Weighted Assets Ratio (CRAR) is a robust 26.65%, and our gross and net NPAs stand at 2.43% and zero, respectively,”he stated.
The bank, which operates 13 branches and five ATMs, is focused on adopting modern technology to meet evolving customer needs.