The country's largest lender State Bank of India (SBI), has expressed its desire to become the lead-bank for the newly carved-out Union Territory of Ladakh. SBI Chairman Rajnish Kumar on Saturday inaugurated a new branch in the remote town of Diskit in the Nubra Valley, making it the 14th facility of the bank in the Ladakh region and 22,024th branch for the bank overall. Every state or region has a lead-bank, which takes the mantle of ensuring adequate banking services as the convenor of the State-Level Banking Committee (SLBC). At present, J&K Bank is the lead-bank for Jammu & Kashmir and Ladakh.

SBI takes up the mantle to become the SLBC convenor

On August 5, the government had announced that the entire region will cease to be a single state but would become two Union territories of J&K and Ladakh, wherein J&K will have a state Assembly under the lieutenant governor, while Ladakh will have no legislature. The announcement was part of the government decision to abrogate Articles 370 and 35A of the Constitution which gave special status to J&K. Speaking to reporters here Saturday, the chairman said if other banks have a problem to be the SLBC convenor, SBI is willing to take up that mantle. He said the branch in Diskit was planned over three months ago, much before the Centre decided to bifurcate the state into two UTs.

Read: SBI Managing Director Anshula Kant appointed MD and CFO of World Bank

SBI's commitment to helping the people in J&K and Ladakh

Kumar also affirmed SBIs commitment to help the people of both the UTs with credit needs once the demand comes. The bank has 185 branches in Jammu & Kashmir and Ladakh, and the personal lending segment is the most active, he said. There is also traction on the small business front, but lending to agriculture and industry is limited in J&K, he admitted, adding that the average loan in this area is also small, at up to Rs 5 lakh. "Through such initiatives, we want the people of the region to know how deep do we take our banking services into the remotest parts of the country," Kumar said.

Read: SBI sought issuance of 147 Look Out Circulars in last five month: RTI

Diskit is located at an altitude of over 10,000 ft and is around 90-km off the border with Pakistan at Turtuk. A local Member of Parliament Jamyang Tsering Namgyal welcomed the SBI move to open two more branches in remote villages, including Batalik, which had seen action during the Kargil conflict in 1999. He expressed hope that these branches will channelise savings of the people and help them access credit, which will lead to the overall growth of the region. This decision of SBI comes after they announced that they have decided to reduce the marginal cost of lending rate (MCLR) by 10 basis points across all maturities ahead of the festive season.

Read: SBI cuts lending and deposit rates ahead of the festive season

Read: Fire breaks out at SBI building in Delhi, no casualties reported