1. FINANCIAL INSTITUTIONS AND ITS PERFORMANCE IN
TIRUNELVELI DISTRICT, TAMILNADU
Dr.C. PARAMASIVAN,
Assistant Professor &Research supervisor,
P.MARISELVAM
PhD ( FT) Research scholar ,
Department of commerce, Periyar EVR College Trichy, Tamilnadu
ABSTRACT
Financial Institutions in India consist of commercial banks, regional rural banks
(RRBs), urban co-operative banks (UCBs), rural co-operative credit institutions,
development finance institutions (DFIs), non banking financial companies (NBFCs),
mutual funds and insurance organisations. This article is focused on the financial
institutions and its performance in Tirunelveli district of Tamilnadu with reference to
banking net work, deposits and advances positions and sector wise advances by the
financial institutions in Tirunelveli district during the study period 2010-11.
-----------------------------------------------------------------------------------------------------Key words: financial institutions, banking network, advances and deposits,
priority sectors
Introduction
Financial Institution is considered as a major component of financial
system of the country which helps to promote the systematic flow of finance
from the available hands to needed hands.
These institutions are primarily
established for the purpose of systematic and sustainable growth of the country.
Presently many financial institutions are activity contributed to the Socioeconomic development of the nation through its lending and advances. Indian
financial institutions are grouped into banking and non banking financial
institutions. Banking institutions are again classified into public sector banks,
1

2. private sector banks and foreign banks. Non banking institutions also classified
into national level financial institutions and state level financial institutions. At
present there are 83 banking and 4 non banking financial institutions in the
country. In this regards, this paper is an attempt to discuss the role of financial
institution in Tirunelveli District of Tamilnadu during the year 2010-11.
Financial Institution in India
Financial Institutions in India consist of commercial banks, regional rural
banks (RRBs), urban co-operative banks (UCBs), rural co-operatie credit
institutions, development finance institutions (DFIs), non banking financial
companies (NBFCs), mutual funds and insurance organisations.
These
institutions, which provide a meeting ground for the savers and the investors,
form the core of India’s financial sector. Through mobilisation of resources and
their better allocation, financial intermediaries play an important role in the
development process of underdeveloped countries. Financial institutions have
transited since the mid-1990s from an environment of an administered regime to
a system dominated by market-determined interest and exchange rates, and
migration of the central bank from direct and quantitative to price – based
instruments of monetary policy operations. However, increased globalisation
has resulted in further expansion and sophistication of the financial sector, which
has posed new challenges to regulation and supervision, particularly of the
banking system. In this context, the capabilities of the existing regulatory and
supervisory structures also need to be assessed by benchmarking them against
the best international practices.
Profile of Tirunelveli District
The Tirunelveli District was formed in 1790 by the East India Company,
later came under the direct control of the British Crown Queen Victoria. The
2

3. name Tirunelveli has been composed from the three Tamil words i.e. “ThiruNel-Veli” meaning “Sacred Paddy Hedge”.
This District is located in the
southern part of Tamilnadu and surrounded by Virudhunagar District on the
North, Tutticorin District on the East, kanyakumari District on the South and
Western Ghats on the West Tirunelveli has its own individuality from rice to
culture.
Agriculture plays a vital role in the District’s economy.
The total
cropped area was 193905 hectares, which worked out 28.91% of the total
Geographical area.
Tirunelveli District is industrially backward. There are 25 medium and
major industries such as Cement, Cotton yarn, Calcium Carbide, Sugar, Cotton
seed oil, Printing papers and flour mills etc., In addition to this there are about
14389 Small scale industries registered in this district.
Financial Institutions in Tirunelveli District
The district is having a well developed banking system with a network of
288 branches of various banks as detailed below.
Table No. 1 Financial Institutions
Sl.No.
Banking Sector
No. of Banks
No. of branches
1
Public Sector
16
155
2
Private Sector
10
36
3
Pandiyan Grama Bank
1
50
4
TCCB Ltd.,
1
26
5
TNCSARD (L.D.Bank)
1
8
6
Urban Co-operative Bank
1
11
7
TIIC
1
1
8
TAICO
1
1
32
288
Total
Source: Lead Bank Annual Report 2010-11
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4. The Tirunelveli District Central Co-operative Bank is having 26 branches
with 162 Primary Agriculture Co-operative Societies affiliated to it. The average
population per branch office in the district is less than 9500 which compares
favourable with the national average of 13000 and state average of 12000/branch.
After the introduction of the new concept of service area approach since 1.4.1989
all the village in the 19 blocks have been allocated to 288 banks branches
operating in rural and semi-urban areas in the district.
Since many new bank
branches have been opened since then, the villages have been re-allocated
periodically taking into account the proximity to the village as well as easy
access.
Banking Network
Network of banks providing financial services, a network of commercial,
saving, and specialized bank that financial provide financial services, including
accepting deposit and providing loans and credit, investment facilities.
Table No.2 Bank wise branches in Tirunelveli District
Sl.No
Public Sector Banks
Rural
1
State bank of India
9
SemiUrban
4
Urban
Total
7
20
2
State Bank of Travancore
0
5
0
5
3
Allahabad bank
-
1
-
1
4
Andhra bank
-
-
1
1
5
Bank of Baroda
-
-
2
2
6
Bank of India
1
1
2
4
7
Canara Bank
7
11
10
28
8
Central bank of India
2
3
3
8
9
Corporation Bank
0
2
1
3
4

5. 10
Indian bank
2
9
8
19
11
Indian Overseas Bank
21
20
10
51
12
Punjab National Bank
1
2
1
4
13
Syndicate Bank
0
0
1
1
14
Uco Bank
1
-
1
2
15
Union Bank of India
0
3
2
5
16
Vijaya Bank
-
-
1
1
44
61
50
155
0
2
0
2
1
5
10
1
1
1
1
0
1
1
1
1
1
9
3
1
1
1
9
1
3
2
1
14
36
21
2
50
21
2
50
-
-
8
17
4
26
3
20
6
10
11
45
-
1
1
Total
1
2
3
4
5
6
7
8
9
10
1
Private Sector Banks
Axis Bank
2
City Union Bank
Feederal Bank
HDFC Bank
ICICI Bank
7
IDBI
0
Karur Vysya Bank
Lakshmi Vilas Bank
South Indian Bank
Tamilnad Mercantile Bank
8
Total
17
Regional Rural Banks
Pandyan Grama Bank
27
Total
1
2
3
1
27
Co-operative Banks
Tamilnadu Co-op. State
8
Agriculture and Rural
Development Bank
Tirunelveli Dist. Central Co-op.
5
Bank
Urban Co-operative Bank
2
Total
15
Other Financial Institutions
Tamilnadu Industrial Co-op.
Bank
5

6. 2
Tamilnadu Industrial Invest
Corporation
Sub Total
Grand Total
Source: Lead Bank Annual Report 2010-11
-
-
1
1
103
112
2
73
2
288
Table No.2 reveals that the banking networking in Tirunelveli district in
the year 2010-11.
There are 155 Commercial bank branches in the districts which includes 44
branches in rural, 61 branches in semi urban and 50 branches in urban area.
As regards Regional Rural Bank, 27 branches in rural, 21 branches in semi
urban and 2 branches in urban area which amounted to 50 branches of Regional
Rural Bank in Tirunelveli district.
There are 45 Co-operative bank branches in Tirunelveli district which
includes 15 branches in rural, 20 in semi urban and 10 in urban areas.
Two Financial Institutions also available in the Tirunelveli district as per
the records.
As on whole, there are 288 banking branches in Tirunelveli district which
consist of 103 branches in rural, 112 in semi urban and 73 branches in urban.
Deposits and Advance Position
Deposits and advances granted by commercial banks are highly beneficial to
firms, companies and industrial concerns. The growth and diversification of business
activities are effected to a large extent through bank financing. Deposits and advances
granted by banks help in meeting short-term and long term financial needs of business
enterprises.
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7. Table No.3 Deposits and Advances (Rs. In Lakhs)
Sl.N
Year
Deposits
Advances
C.D. Ratio
o
1
2005-06
346201
248111
72%
2
2006-07
383800
295268
77%
3
2007-08
468799
376774
80%
4
2008-09
577963
430263
74%
5
2009-10
619587
493513
80%
Source: Lead Bank Annual Report 2010-11
Table shows that Deposits and Advance Position in Tirunelveli district
during the year 2005-06 to 2009-10.
Highest C.D ratio were recorded (80%) in the year 2007-08 and 2009-10
and the lowest C.D ratio 72% shown in the year 2005-06. Deposits position has
been increased from Rs. 346201 Lakhs in 2005-06 to 619587 Lakhs in 2009-10.
Advances in highest C.D ratio for the above detail, as far as the Advance
position has been increased from Rs. 248111 Lakhs in 2005-06 to Rs. 493513 Lakhs
in 2009-10.
Sector wise Advances
Operation and expansion of business and commercial activities depend a
great deal on the availability of sector wise loans/advances from commercial
banks. Financial assistance to bank, sector wise loans and advance, cash credits,
overdrafts, etc., from the issued by various sectors.
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8. Table No.4 Sector wise Advances
Agriculture
Advances
Year
Priority
D.R.I. Adv.
sector
2005-06
2006-07
2007-08
2008-09
2009-10
%
Amount
%
Amount
74217
80346
101383
108980
187988
30
27
27
25
38
150047
183335
243742
229052
361129
60
62
65
53
73
190
38
128
253
228
%
0.08
0.01
0.05
0.11
.05
Weaker
SC/ST
Amount
Advances to
Sec.
Amount
11533
18181
27091
28532
30872
%
5
6
11.41
12.46
6.26
Amount
%
34751
48817
65864
66086
103609
14.01
16.53
17.48
15.36
20.99
Source: Lead Bank Annual Report 2010-11
As regards Agricultural sector, Rs.187988 Lakhs as advances in the year
2009-10 as against Rs. 74217 Lakhs in 2005-06.
Percentage of advances to
agriculture sector in the year 2009-10 is 38% as against 30% in the year 2005-06.
Priority sector Rs.361129 Lakhs as priority sector in the year 2009-10, as
against Rs. 150047 Lakhs in 2005-06, Percentage of priority sector in year 2009-10
is 73% as against 60% in the year 2005-06.
D.R.I Advances Rs.228 Lakhs as D.R.I advances in the year 2009-10; as
against Rs.190 Lakhs in 2005-06, Percentage of D.R.I advances in the year 2009-10
is 0.5% as against 0.08% in the year 2005-06.
Advances to SC/ST sector is 6.26%, as in the year 2009-10, as against
Rs. 11533 Lakhs in 2005-06, percentage of advances to SC/ST sectors in the year
2009-10 is 6.26% as against 5% in the year 2005-06.
As regards the Weaker Sector Rs. 103609 as weaker sector to the year
2009-10, as against Rs.34751 Lakhs in 2005-06, percentage if weaker sector in the
year 2009-10 is 20.99% as against 14.01% in the year 2005-06.
Major findings
Financial Institution is considered as a major component of financial
system of the country which helps to promote the systematic flow of finance
from the available hands to needed hands.
8

9. Financial Institutions in India consist of commercial banks, regional rural
banks (RRBs), urban co-operative banks (UCBs), rural co-operatie credit
institutions, development finance institutions (DFIs), non banking financial
companies (NBFCs), mutual funds and insurance organisations.
Tirunelveli District is industrially backward. There are 25 medium and
major industries. In addition to this there are about 14389 Small scale industries
registered in this district.
The district is having a well developed banking system with a network of
288 branches of various banks. C-D ratio has been increased from 72 per cent to
80 per cent during the period 2005-06 to 2010-11.
Agriculture sector advances constitutes more than 35 per cent followed by
weaker sections (about 15 %) and advances to SC/ST over a period.
Conclusion
Financial institutions are the major components of the financial system of
the country which play a pivotal role in the field of flow of money from one
hands to others. commercial banks are the nerve system of the socio economic
development of the nation with concentrate to achieve the overall goals of the
people ,government and institutions . The performance of financial institutions in
Tirunelveli district plays a key responsibility in the developmental activities of
the region and provided liberal and sufficient financial assistance to various
sectors including agriculture.
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