Banks Score on Bonus issue


It declined from 57 per cent in 1960 to 48 per cent in 1963 but then rose to 53 per cent in 1966. The latest ratio is lower than that of the State Bank itself and is, of course, substantially lower than that of other commercial banks. The initial decline was perhaps due to the cleaning up of substandard advances extended before take-over. The increase since then remains moderate. Is this because the State Bank looks upon its subsidiaries as agencies primarily for deposit mobilisation and opening of relatively inexpensive branches rather than for somewhat more normal banking activity or because greater centralisation of management is adversely affecting the operations of subsidiaries?