Union Bank of India-Report of the Board of Directors

Report of the Board of Directors THE year 1971 saw batik deposits far outstripping bank advances. This was because of much better accretion to deposits on the one hand and lower demand for bank credit on the other, as compared to the previous year. Despite the fact that during the year National Income increased by only 4 per cent and industrial production was in a state of near stagnation, the aggregate deposits of scheduled commercial banks increased from Rs 5,685 crores on the last Friday of December, 1970 to Bs 6,858 crores on the last Friday of December, 1971, thus registering an increase of Rs 1,171 crores or 20.60 per cent as compared to the increase of Rs 808 crores or 16.58 per cent in the year 1970. On the other hand, as a result of subdued industrial activity the demand for bank credit was on a low key. During the year bank advances increased by Rs 514 crores, from Rs 4,452 crores to Rs 4,966 crores, i e, an increase of only 11.54 per cent as compared to the increase of Rs 836 crores or 23.13 per cent in the previous year. Consequently, by the end of the year, the credit-deposit ratio had declined from 78.32 per cent to 72.43 per cent.