Karnataka Bank Managing Director and CEO M.S. Mahabaleshwara has said the bank’s Capital to Risk Weighted Assets Ratio (CRAR) was well above the minimum prescribed by the Reserve Bank of India and urged people not to get carried away by reports on visual media or social media.
A release from the bank on Wednesday quoted Mr. Mahabaleshwara as saying CPAR was the benchmark to assess a bank’s health and not the so called “M-Cap to Deposit Ratio.” Referring to the recent report by a television channel which was also widely circulated on social media, he was categorical in denouncing “M-Cap ratio” used by the TV channel to measure the health of banks and safety of deposits with them.
Audited balance sheet
Mr. Mahabaleshwara said as per the audited balance sheet as on March 31, 2019, CRAR of Karnataka Bank stood at 13.17% that was well above the minimum regulatory prescription. Bank’s internal policy stipulates maintaining CRAR of at least 1.% above the regulatory requirement. “We have been consistently maintaining CRAR above the minimum prescribed by the RBI as well as the Bank’s internal policy,” he said.
The MD further said Union government’s chief economic advisor Krishnamurthy Subramanian, RBI Governor, State Bank of India and other banking experts have categorically endorsed the views that globally for assessing the health of banks the CRAR was used and banks in India were well capitalised; therefore were safe and healthy.
Allaying fear among depositors, Mr. Mahabaleshwara said the bank was in existence for 96 years that has been built on the trust of 11 million customers across the country. The bank was well capitalised, professionally managed and has been fundamentally strong.
