The Journey of Devanga Bank Limited

The Journey of Devanga Bank Limited: A Legacy in Indian Banking

Devanga Bank Limited was established on January 22, 1926, in Bangalore, Karnataka, with a clear focus on empowering the local Devanga community through banking services. Over the years, it underwent several vital transformations, leaving behind a legacy intertwined with the growth of banking in India.

Foundation and Purpose

Initially, Devanga Bank Limited was set up as a community-driven financial institution with an authorized share capital of ₹500,000. The bank aimed to serve the financial needs of the Devanga community, supporting local businesses, tradespeople, and artisans. It quickly became a trusted institution in the region, reflecting the cooperative spirit of early Indian banks.

The bank operated with two primary offices, one located in Bangalore city and another in Doddaballapur, both of which catered to a wide array of customers.

Key Milestones: Mergers and Acquisitions

In 1963, a significant shift occurred when Vijaya Bank Ltd. took over Devanga Bank under a Reserve Bank of India-sanctioned amalgamation scheme. This move was part of a broader strategy in India to consolidate smaller, regional banks with larger institutions, thereby strengthening the banking sector. The amalgamation allowed Vijaya Bank to absorb Devanga Bank’s resources, including its branches and customer base.

The merger marked the end of Devanga Bank as an independent entity, though its contributions to local commerce were significant. Vijaya Bank, which itself became a nationalized entity in 1980, played a crucial role in absorbing regional banks and continuing their legacy. After the nationalization of Vijaya Bank, the non-banking activities of the merged entity were handled by Vijaya Commercial Credit Ltd..

Growth and Share Capital Adjustments

Throughout the late 20th century, Vijaya Bank, along with its merged entities, saw substantial growth in share capital and business operations. The company issued multiple tranches of shares, including public offerings and rights issues:

• 1970: Over 14,617 equity shares were allotted to the public.
• 1982: Shares of ₹10 each were exchanged for Devanga Bank’s share capital.
• 1985: The company raised capital by issuing secured redeemable convertible debentures worth ₹130 each. Part of this was converted into equity shares, enhancing the company’s financial strength.

The adjustments in share capital continued well into the 1990s, with new shares offered to employees, business associates, and public subscribers. By 1994, a significant number of shares were offered at a premium, reflecting the company's growth trajectory and its ambition to strengthen its capital base.

Legacy and Dissolution

Despite its initial success, Devanga Bank eventually became a part of India's broader banking history. The official status of Devanga Bank Limited is currently marked as Strike Off, meaning that it no longer operates as a legal entity. This is a common fate for many regional banks of that era, especially those that merged with larger institutions.

The final Annual General Meeting (AGM) and balance sheet filing were done on January 1, 1970, before the bank's operations were fully absorbed into other entities.

Impact and Legacy

While the bank is no longer operational, its legacy persists in the collective memory of the Devanga community and the banking sector in Karnataka. The role of Devanga Bank in supporting local businesses and artisans remains significant, as it was an essential community asset during its operational years.

Moreover, its merger into Vijaya Bank ensured that its customers were provided with expanded services under a more robust financial institution, which, in turn, continued to grow until Vijaya Bank was later merged into the Bank of Baroda in 2019. Thus, the story of Devanga Bank contributes to the narrative of consolidation and evolution in the Indian banking sector.

Conclusion

Devanga Bank Limited’s journey from a small community bank to its eventual absorption into Vijaya Bank illustrates the changing banking landscape in India during the 20th century. The bank may no longer exist, but its historical significance, especially for the Devanga community, remains an essential chapter in the history of Indian banking.