Deposits of Rs 42,000 cr have come in: PNB Chief

In a move to curb black money, government cancelled the legal tender character of Rs 500 and Rs 1000 notes. Banks have been working aggressively ever since to help people in this crisis of currency ban. In conversation with CNBC-TV18, Usha Ananthasubramanian, MD & CEO of Punjab National Bank (PNB), said 200 branches of PNB have been working in double shifts. She said demonetisation has a positive fallout for banks. There is increase in current and savings account ratio (CASA) and deposits of about Rs 42,000 crore have been added to the accounts. There is also increase in new bank accounts.She further said there will be huge inflows towards the end of December. There have been good inflows in loan accounts of about Rs 5000 crore. Maintaining a positive stance, Usha said there are ATMs that are running 24x7 in select cities. PNB is using micro ATMs to serve people at their doorstep. The bank is using mobile and van ATMs. She also said the use of indelible ink and increase in withdrawal levels are helping the banks.Below is the transcript of Usha Ananthasubramanian’s interview to Latha Venkatesh and Anuj Singhal on CNBC-TV18.Latha: If you can start by telling us what is the extent of cash dispensation that looks over? Are your ATMs better serviced? Are they all functional and your branches, what is the queue situation?A: From 10th onwards, the branches have started operating in full-swing. The ATMs, yes of course, which were initially dispensing Rs 100 notes have been getting recalibrated in a very orderly manner for Rs 2,000 and Rs 500 notes. And of course, Rs 100 is always there. So, there are certain ATMs, which have been coming up for multiple currency dispensation, there are certain which are for Rs 2,000 and some are still running on Rs 100. But we feel over a period of time, there will be a lot of orderliness coming in. What was on 10th or 11th, today the situation has changed.There are many ATMs, which are running 24x7 in select cities, select ATMs have been announced which would be 24x7. At the ground level, branch level, the queues, which were too long to be seen are certainly reducing in many pockets and certainly the indelible ink, which has been introduced and the increase in withdrawal levels, all these things have been helping us.We, from our part, all the banks, including Punjab National Bank have been extensively using camp mode and the micro ATMs to get into a lot of places. So that the crowds can be managed, people can be served at the door step. For example, we have a lot of mobile ATMs moving around, mobile vans moving around as exchange counters. Even a place like IITF, we are having three ATMs and one exchange counter. So, these kind of improvisations at the ground level has also been helping.And from our bank’s side, we have made at least 200 branches to work in double shift that morning eight to eight. This has been very helpful to the customers. Staff are being fresh in the second half of the day otherwise, the levels of energy which would taper by evening has been managed well with the induction of a fresh set of staff coming in to take charge.Anuj: There is a bit of a risk of a fatigue setting in and this initial enthusiasm dying down. Do you think that could be a bit of a risk factor going forward?A: I do not think because the staff has also realised that this is a moment in the timeline that they have to come up to the expectations and people have taken it as a national cause, for which it is not the routine 9-to-5 desk work or the counter work they were doing. But today, it is something a little different that they are part of a national cause and they have realised that it is very important that they should be with full enthusiasm and even as late as 10 o’clock some people have been working, but we have been taking rounds in the branches in the night also, people are as cheerful as they are.That is why we thought, in some crowded branches where there are long queues and otherwise also the customer numbers are very high, we have introduced double shifts, which helps the staff as well and maybe for the next few days, some more branches would get added so that the staff also gets a relief simultaneously with the customers.Latha: What is the sense you are getting since you operate perhaps the second largest number of branches second next only to Mrs Bhattacharya that would we, by November 30, see banks as normal places where people do not crowd. They will rather go to malls than banks?A: They should have the kind of cash or the plastics or the digital channels will have to be used. This is an opportunity we see for the digital channels to be thrust in a big way. Even to the vendor, we are teaching him how to use a unified payment interface (UPI) so that even the smallest of vendors can make use of that.So, there are certain very positive fallouts for banks. One as you see is the current account and savings account (CASA) increase in a very big way. We have been able to add about Rs 42,000 crore till yesterday evening. Of course, the extended hours have been there. The final numbers have to reach, but the cumulative looks around Rs 42,000-43,000 crore as of yesterday.And maybe, as the withdrawal limits increase, there will be certainly draw-downs happening from the accounts, but at least 50 percent will be retained and some more till December 31, there will be some huge inflows happening towards the end of December, that is what we think. People who are refraining to come and waiting to do things. But, there is a tremendous opportunity, because wherever we have gone, we have been holding camps at several places like the civil servants' colonies or police colonies or army jawans camps, hospitals. Surgeons and doctors, several of them have come forward to open accounts with us.And wherever we have done, it is not that we have a salary account relationship, it is just a service that we are giving. For example, All India Institute Of Medical Science (AIIMS), and in Mumbai at KEM Hospital and a lot of other places. PGI in Chandigarh, those kind of spots where people require money and they are in an emergency situation. These kind of things have made people come forward and opened a lot of accounts. And tab banking is extensively used at these places to create new relationships. So, the fallouts for the banks are also positive in terms of surge in CASA, maybe in a phased manner getting stabilised.The opportunities for digital channels enhancements and for creating new relationships and I must also tell you there are some good inflows happening in loan accounts. Almost about Rs 5,000 crore have come into the loan account in whatever way, because we have been telling people not only that you have to deposit in your deposit accounts, you can also deposit in loan accounts. So, people have been coming forward. Some instalments are getting serviced in whatever way. There is a traction on the loan channels also.Anuj: One more word in this whole process. One problem which a lot of people are facing is the lack of Rs 500 notes. There either Rs 100 notes or Rs 2,000 notes. So the gap is too big and the problem with that is when you go to the market, then you face a bit of a struggle. By when can that be sorted?A: The situation should ease because the RBI even as late as yesterday evening has said they are pushing more Rs 500 notes into circulation. What you say is right. If I take a Rs 2,000 note and I want to buy something for Rs 100, the other party will not be able to give me Rs 1,900. So, what we are doing in our bank is we are using the whatever multi currency dispensation we have at the counters, we are also giving Rs 20 notes, whatever is available, in fact, even coins are given out because they are absolutely 10 coins of 10 or 20 coins are easy to handle. And it helps you to walk through into markets or do your personal things. So, that way, we have been trying to disburse a variety of currencies to the public so that their hardship is minimised in terms of their personal needs and I am sure Rs 500 note situation should ease because given the RBI has been telling that there has been enhancements, production is getting stepped up. All these things should see in the next few days certainly a lot of easing happening.Latha: How do you expect the non-performing loans (NPL) issue to pan out? There would be a lot of Micro, Small and Medium Enterprises (MSME), Small and Medium Enterprises (SME) exposures. Do you think that only for this quarter, you might actually see a rise in NPL? Something that has been coming down for you?A: We are very closely tracking all the accounts whether it is retail, MSME, agriculture or even industrial portfolio. In the last 10-15 days, the aggression of looking into them is much more and I must also say that simultaneously the branches are engaged in management of the customer needs in a very big way. But at the same time, the recoveries are also happening. We are able to get a decent recovery everyday from all our circles and I should say for the last 45 days of this quarter. I would say on an average it has been pretty okay. It could have been much better, but we need to have our priorities, but I would not say recovery has come to an end or people have shut shop. Certainly recovery is also happening. Maybe the pace must have reduced a little, but the activity is in full swing.