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CS Professional · Banking and Insurance - Laws and Practice · Various Government Schemes

A bank's Adjusted Net Bank Credit (ANBC) is Rs 2,000 crore. It has lent Rs 1,500 crore to priority sectors, of which Rs 300 crore is to small and marginal farmers. Assume the targets are 40% overall priority sector lending and 10% for small and marginal farmers. Which statement is correct?

Both targets are met. Priority sector lending is 75% of ANBC against 40%, and lending to small and marginal farmers is 15% against 10%. The required sub-target is only Rs 200 crore, so the Rs 300 crore lent exceeds it.

  1. AOverall target met (75%) but the small and marginal farmer sub-target is missed
  2. BOverall target met (75%) and small and marginal farmer sub-target met (15%)Correct
  3. COverall target is missed because 1,500 is below 2,000
  4. DOverall target met but sub-target needs Rs 400 crore, so it is missed

Explanation

Overall: 1,500/2,000 = 75%, above 40%. Small and marginal farmers: 300/2,000 = 15%, above 10%. Both targets are met; the required sub-target amount is only Rs 200 crore.

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