J&K Bank will diversify loan mix in rest of India for stable growth: MD

KOLKATA: Private sector lender Jammu & Kashmir Bank, which has two-third of its business coming from the disruption-prone Kashmir valley, is attempting to diversify the loan mix in rest of India to build stability in business growth with a focus on building the housing and mid-corporate book, managing director Amitava Chatterjee told analysts.

The bank, in which the governments of union territories of Jammu & Kashmir and Ladakh hold a majority share with 59.4% interest, plans to reduce concentration risks.

“The new MD plans to firmly accelerate the business from rest of India with a clear focus on building the housing and mid-corporate book,” Anand Dama, senior research analyst with Emkay Global Financial Services said on Tuesday.

The brokerage house had a meeting with the bank management to understand its long-term business plan and effect of the recent Pahalgam terror attack on tourists.

“We do have an aim to reduce the concentration risk and try to have a balanced growth from both the geographies, whether it is the rest of India or Jammu & Kashmir,” Chatterjee told analysts in a post-earnings call held last month.

Chatterjee, who assumed charge on December 30 last year, said the Pahalgam terror attack had limited impact on its business as exposure to tourism-linked lending was less than 1% of the portfolio, which stood at Rs 1.07 lakh crore at the end of March.”While Jammu & Kashmir will continue to receive our attention as it has been through the decades, we will try to balance it out with a better growth from the rest of India and that too not essentially from the corporate loan book,” he said last month.The bank is trying to improve retail lending like housing loans and car loans outside Kashmir.