The Gujarat State Co-Operative Agricultural and rural development bank ltd

Financial Resource

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Bank raises its financial resources mostly by floating debentures which are of two types (1) Ordinary and (2) Special. Debentures o f this bank are considered as trustee securities as its repayment of principal and payment of interest guaranteed by State Government. Period of maturity of Bank's debenture is ranges from 7 to 15 years. They are transferable, free from stamp duty and registration. Special debentures are subscribed by NABARD, State & Central Government while ordinary debentures are subscribed by financial institutions & sister concerns. Other source of fund is share capital which is subscribed by Bank's loanee members as well as contributed by State Government. It is compulsory for the loanee to hold banks share to tune of 5 percent of loan amount, bank also accept fix deposits to raise it fund Other funds of the Bank such as Reserve Fund, Building fund etc, are created from bank's profit and they are termed as owned funds Generally Bank finds no difficulty in raising the resources but it has to work in accordance with the financial discipline as imposed by RBI/NABARD and to take utmost care to ensure the recycling of scarce financial resources.