Unified Karnataka Grameena Bank to come into existence on May 1

Sreekant M. Bhandiwad, who hitherto headed KVG Bank, will be the chairpersons of the unified Karnataka Grameena Bank (KGB), which will come into existence on May 1, 2025.
| Photo Credit: SPECIAL ARRANGEMENT

As per a notification issued by the Central Government in line with its ‘One state, One RRB’ policy, a unified Karnataka Grameena Bank (KGB) with its headquarter at Ballari, will come into existence on May 1. KGB has been formed by the amalgamation of Karnataka Vikas Grameena Bank (KVGB) and Karnataka Grameena Bank (KGB).

When the Central Government first established Regional Rural Banks (grameena banks) in 1975, 196 RRBs were functioning across India, including 13 in Karnataka. To further strengthen these institutions, the government initiated the first phase of amalgamation in 2005 and empowered grameena banks. As a result of this and subsequent mergers, the number of RRBs in the country came down to 43, with only two remaining in Karnataka.

Karnataka Vikas GrameenaBank (KVGB), headquartered in Dharwad, had 629 branches across 9 districts. The bank had a business turnover of ₹38,714 crore.

Karnataka Grameena Bank (KGB), headquartered in Ballari, had 1,122 branches across 22 districts. Its turnover was ₹66,137 crore.

The two banks have been amalgamated to form the unified Karnataka Grameena Bank. The newly-formed Karnataka Grameena Bank will continue to be government owned, with the Central Government holding a 50% stake, the State Government 15% and Canara Bank (sponsor bank) 35%. The bank’s services will now be extended across Karnataka, making it the second-largest Regional Rural Bank in India with 1,751 branches and a business turnover of ₹1,04,851 crore.

Sreekant M. Bhandiwad, who hitherto headed KVGB, will now be heading the unified KGB.

Mr. Bhandiwad said that the two grameena banks had played a pivotal role in channelling  institutional credit to the rural economy. The unified RRB would continue doing the same with renewed strength and greater security. The amalgamation would strengthen the RRBs in the country, he said.

He appealed to customers and the general public for their continued co-operation. As the largest government-owned rural bank, the new entity is committed to delivering even better and more efficient services to its vast customer base, he said.