Page 1 of 7
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 04 Issue 02
February 2018
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 1
Performance of Private Sector Banks in Jammu and Kashmir
(With Special Reference to J&K Bank)
Abdul Rashid Naikoo
Research Scholar, School of Studies in Commerce, Vikram University Ujjain (M.P)
Email: davoodnaikoo786@gmail.com
ABSTRACT
The Jammu and Kashmir Bank has been assuming critical part for the upliftment of poor, to
raise the expectation for everyday comforts of masses and furthermore to relieve their
province of Jammu and Kashmir through its miniaturized scale back administrations. The
investigation was led among the clients of Jammu and Kashmir Bank in Shopian and
Anantnag Districts to examine the strategy, practices, and part of microfinance gave by
Jammu and Kashmir Bank as far as how well it accomplished its own objectives: to achieve
the poorest populaces, to guarantee a positive quantifiable effect on the lives of customers
and their families, to fabricate monetarily independent establishments, and to reach and
enable ladies versus the future difficulties and recommend the probable changes.
Keywords: performance, Micro Credit, Poverty Eradication, Private Sector.
INTRODUCTION
A Bank is a financial institution and a financial intermediary that accepts deposits and
channels those deposits into lending activities, either directly by loaning or indirectly through
capital markets. The private sector in India represents part of Indian banking sector that is
made up of both private and public sector banks. The private sector banks are banks are
where greater parts of stake or equity are held by the private shareholders and by the
government. Banking in India has been dominated by public sector banks since the 1969
when all major banks were nationalized by the Indian government. Banking in India has been
dominated by public sector banks since the 1969 when all major banks were nationalised by
the Indian government. However since liberalisation in government banking policy in 1990s,
old and new private sector banks have re-emerged. They have grown faster and bigger over
the two decades since liberalisation using the latest technology, providing contemporary
innovations and monetary tools and techniques. The private sector banks are split into two
groups by financial regulators in India, old and new. The old private sector banks existed
prior to the nationalisation in 1969 and kept their independence because they were either too
small or specialist to be included in nationalisation. The new private sector banks are those
that have gained their banking license since the liberalisation in the 1990s. J&K bank, one of
the leading banks in the country, is a brand with heritage, widespread presence and a strong
track record of solid performance and stability under very difficult conditions. It is also
unique in that it is a private sector bank, despite the Government holding a majority stake; it
is the sole banker and lender of the last resort to the government of J&K. It is the only private
sector bank designated as RBI’s agent for banking business, and it carries out the banking
business of the Central Government in the State
HISTORICAL BACKGROUND OF JAMMU AND KASHMIR BANK:
Entire banking in the state of Jammu and Kashmir was performed by traditional lenders till
1920 -30 and that too at exorbitant interest rates. At the same time some banks functioned at a
very limited scale, such as Punjab National Bank Limited, Grindlay's Bank and Imperial
Bank of India. The role of these banks was reduced to the acceptance of deposits, as they
could not grant loans and advances to the people of the state owing to the statutory
limitations. Under this scenario banks could not revolutionize the financial and social
position of the people of the state. To overcome this critical situation the then “Maharaja”
Page 2 of 7
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 04 Issue 02
February 2018
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 2
(King) of the state conceived an idea of setting up of a bank in the state. After a prolonged
exercise and deliberations the assignment for establishment of “The Jammu and Kashmir
Bank Limited” was given to the late Sir Sorabji N Pochkhanwala, the then Managing
Director of the Central Bank of India. Mr.Pochkhawala formulated a scheme on 24-09-1930,
suggesting establishment of a semi state Bank with participation in capital by state and the
public under the control of state Government. Thus the bank was formally incorporated on
the First of October 1938 and commenced business from 4th of July 1939 at its Registered
Office Residency Road Srinagar, Kashmir. The Jammu & Kashmir Bank Limited has been
the first of its nature and composition as a State owned bank in the country .The state Govt.
besides contributing half of the issued capital also appointed it as its bankers for general
banking and treasury business. In its formative years, the bank had to encounter several
serious problems, particularly around the time of independence, when out of its total of ten
branches two branches of Muzaffarabad and Mirpur fell to the other side of the line of control
(now Pak Administered Kashmir) along with cash and other assets, in 1947. However the
State Govt. came to its rescue with the assistance of Rs.6.00 Lacs to meet the claims however
the bank overcomes its difficulties and kept growing. Following the extension of Central laws
to the state of Jammu & Kashmir, the bank was defined as a govt. company as per the
provisions of Indian companies act 1956 .The bank had its first full time chairman in 1971,
following social Central measures in banks .The year 1971 was a turning point for the bank
on conferment of scheduled bank status and witnessed remarkable progress in all the vital
fields of operations .The bank was declared as "A" Class Bank by Reserve Bank of India in
1976 .In recognition of dominant role and exalted performance, Reserve bank of India
appointed the bank as its agent for performing the general banking business of the Central
Govt. especially in maintaining currency chests and collection of taxes.
Objectives of the study:
1. To study level of satisfaction among customers regarding the performance of Jammu and
Kashmir bank.
2. To determine the perceptions regarding the service scheme provided by Jammu and
Kashmir bank.
3. To evaluate the progress and current status of financial inclusion in the state.
Research methodology
The study will be carried out with the help of secondary data published by the bank from time
to time. The data is collected from various journals, reports and annual reports and also have
been collected from various websites of Jammu and Kashmir bank.
Bank’s Growth Scenario
The most important aspect of growth is its stability. Over the last fifty years or so, the Indian
economy in general and service sector in particular, has passed through the phases of high
growth with high volatility, now it is witnessing growth with stability. Stable growth is much
more desirable than growth with instability. This is especially so far as the impact of growth
on poverty and unemployment. At the state level, which provides the operative economic
context for the functioning of J&K Bank, in the new strategy, the growth performance has
been more than exceptional. The Gross State Domestic Product (GSDP) which is the total
income of the economy has seen a sharp turnaround in the last three years. In terms of the
Page 3 of 7
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 04 Issue 02
February 2018
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 3
composition of GSDP, share of primary, secondary and tertiary sector in GSDP is around
30%, 17% and 53% respectively.
World of J & K Bank
Incorporated in the year 1938, J&K Bank is promoted by the Government of Jammu and
Kashmir (J&K) state, which holds 53.17 % stake in the Bank. J&K Bank is head quartered at
Srinagar and has a National Business Centre at Mumbai and North Zone headquarters at
Gurgaon, Haryana.
J&K Bank is listed on the NSE and the BSE. Having track record of uninterrupted profits and
dividends for four decades, J&K Bank functions as a universal bank in Jammu and Kashmir
and as a specialized bank in the rest of the country. It has 857 business units and1,006 ATMs
across the country. It also conducts banking business of the Central Government like Direct
Tax collection, Indirect Tax collection and Utility bills collection.
J&K Bank operates on the principle of 'socially empowering banking' and seeks to deliver
innovative financial solutions for households besides small and medium enterprises.
India Ratings and Research (FITCH) has assigned a rating IND AA with stable outlook to the
bank’s long term debt.
Major focus areas of J&K Bank CSR programmes/activities
a) Promotion of education
b) Preventive Healthcare & Improving Public Health Delivery system under Project
RAAHAT
c) Environmental & Ecological Concerns
d) Swach initiatives
e) Vocational Skills
f) Revival of art
Corporate Social Responsibility
As a responsible institution, J&K Bank is committed to Corporate Social Responsibility
(CSR). With an aim to instill a sense of relief and protection among the most vulnerable
sections of society, the Corporate Social Responsibility (CSR) policy of the bank identifies
key responsibility areas and seeks to assimilate the CSR ideals into its empowerment mission
for optimizing its social performance. The Bank retained its comprehensive focus on
activities for the larger community welfare through CSR initiatives concentrating on people’s
health, education, environment and society at large. Major CSR activities in the year 2015-17
Healthcare under Project RAAHAT
Responsive towards individual as well as collective health of people across the state, the
Bank unfailingly implements its robust endowment programme. During the year, Preventive
Healthcare & Improving Public Health delivery system, remained the focus of Bank’s
proactive support especially towards the deprived sections of society. As a responsible
institution towards the wellbeing of general public, the Bank provided all sort of support to
