Mar 31, 2019
The Board of Directors has pleasure in presenting the Bankâs Annual Report along with Audited Balance Sheet and Profit and Loss Account of the Bank for the year ended 31st March 2019.
Business Operations
The Business of the Bank stood at RS.4,04,194.84 crore as on 31st March 2019 as against RS.3,55,552.07 crore as on 31st March 2018. Total deposits of the Bank stood at RS.2,32,645.38 crore. The gross advances as at end-March 2019 stood at RS.1,71,549.46 crore. The Credit deposits ratio of the Bank, as at end-March 2019, stood at 73.77%. The Bank ensured adequate flow of credit to the productive sectors of the economy. The Loans & Advances portfolio of the Bank is well diversified and balanced.
Key Highlights of Bankâs Performance in FY 2018-19
- During the financial year 2018-19, the Govt. of India infused capital aggregating to RS.6686 crore in the Bank. The Bank also raised capital of an amount upto RS.250 crore from its employees under ESPS Consequently, the Capital Adequacy of the Bank improved to 12.73% as on 31st March 2019 froRs.10.50% as at 31st March 2018.
- The restrictions imposed on the Bank by RBI under the PCA framework were lifted on 31st January 2019 in view of its improved performance and the Bank meeting the benchmark levels as per the PCA framework.
- The Bank reported Net Profit of RS.55 crore for FY 2018-19 as against loss of RS.5872 crore for FY 2017-18.
- The Gross NPA reduced froRs.17.63% as at 31st March 2018 to 12.66% as on 31st March 2019 while the Net NPA declined froRs.10.48% as at 31st March 2018 to 5.93% as on 31st March 2019.
- The deposits of the Bank witnessed a growth of 12.20% y-o-y and the gross advances increased by 15.75% y-o-y. CASA deposits as a percentage of total deposits of the Bank stood at 29.40% as on 31st March 2019.
- Retail Advances Portfolio increased by 41.62% y-o-y and MSME Advances Portfolio increased by 12.63% y-o-y.
- Cash Recovery and Upgradation increased from RS.3161 crore for FY 2017-18 to RS.6597 crore for FY 2018-19 while fresh slippages were contained to RS.7066 crore during the reported year against RS.12429 crore of FY 2017-18.
- The Provision Coverage Ratio improved to 75.84% as on 31st March 2019 froRs.64.07% as at 31st March 2018.
- NIM for FY 2018-19 increased to 2.73% froRs.2.18% for FY 2017-18.
- The Cost of Deposits decreased to 5.64% as at March 2019 froRs.5.67% as at March 2018, while yield on Total advances increased to 8.23% as at March 2019 froRs.7.73% as at March 2018.
Capital & Reserves
During the Financial Year 2018-19, the Bank received capital infusion from the Government of India in two tranches viz. RS.5500 crore on 31st December 2018 and RS.1186 crore on 31st January 2019. Accordingly, upon receipt of all requisite approvals, the following shares were allotted to the Government of India on Preferential basis:
(i) 57,23,20,499 equity shares at an Issue price of RS.96.10 (including premium of RS.86.10) per share aggregating to RS.5500 crore
(ii) 13,89,89,804 equity shares at an Issue price of RS.85.33 (including premium of RS.75.33) per share aggregating to RS.1186 crore
Oriental Bank of Commerce Employee Share Purchase Scheme [OBC-ESPS]:
The proposal for issuance of shares under Employee Share Purchase Scheme was approved by the shareholders of the Bank in the Extraordinary General Meeting held on 21st December 2018. Accordingly, the Bank made an offer of 2,61,31,493 new equity shares of face value of RS.10.00 each to its eligible employees under OBC-ESPS for cash at an issue price of RS.71.76 per share including premium at a discount of 25% on the floor price of RS.95.67 per share. The entire offer was validly exercised by 20867 eligible employees and the allotment of shares was made on 16th February 2019 against which the Bank received an amount of RS.187.52 crore as subscription money. In terms of the provisions of the SEBI (Share Based Employee Benefits) Regulations, 2014, the shares allotted under the OBC-ESPS would remain under lock-in for a period of one year from the date of allotment.
Subsequent to the approval of the shareholders, there has been no material change in the said scheme and the Scheme has been implemented in compliance with SEBI (Share Based Employee Benefits) Regulations, 2014. The relevant disclosure under Regulation 14 of SEBI (Share Based Employee Benefits) Regulation, 2014 is available at the website of the Bank www.obcindia.co.in. Further, a certificate from the Statutory Central Auditors of the Bank that the Scheme has been implemented in accordance with the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 and Resolution passed by the shareholders of the Bank shall be placed before the shareholders in the Annual General Meeting.
Subsequent to the aforesaid allotments, the shareholding of Government of India increased froRs.77.23% as at 31st March 2018 to 87.58% as at 31st March 2019.
Accordingly, during FY 2018-19, the Paid-up capital of the Bank increased by RS.737.44 crore and Share Premium by RS.6136.08 crore. During the year, the Bank has redeemed one series of Upper Tier II Bonds aggregating to RS.500.00 crore upon exercise of Call Option by the Bank in terms of applicable guidelines. The Capital & Reserves as on March 31, 2019 were at RS.18,901.24 crore as against RS.11,786.76 crore as at end March 2018 and the ratio of Capital and Reserves to average working funds stood at 7.52% as on 31st March 2019 as against 4.64 % as on 31st March 2018.
Capital Adequacy Ratio
The Bankâs Capital Risk Weighted Assets Ratio (CRAR) as on 31st March 2019 under Basel III Guidelines stood at 12.73% as against 10.50% as on 31st March 2018.
Category |
March 2018 |
March 2019 |
CET-I (%) |
7.46% |
9.86% |
Tier I Capital (%) |
7.61% |
9.98% |
Tier II Capital (%) |
2.89% |
2.75% |
Capital Adequacy Ratio (Tier I Tier II) |
10.50% |
12.73% |
Financial Performance
The Bank has posted a total income of RS.20,536.77 crore during the year as against RS.20,181.25 crore last year. The Operating Profit of the Bank increased to RS.3753.76 crore for the year ended 31st March 2019 as against RS.3,703.18 crore for the year ended 31st March 2018. The Financial performance of the Bank is given below:-
Financial Performance
(Amt. in Rs. crore)
31.03.2019 |
31.03.2018 |
|
Interest Income |
17867.69 |
17388.89 |
Other Income |
2669.08 |
2792.36 |
Total Income |
20536.77 |
20181.25 |
Interest Paid |
12369.57 |
12888.13 |
Operating Expenses |
4413.44 |
3589.94 |
Total Expenses |
16783.01 |
16478.07 |
Operating Profit |
3753.76 |
3703.18 |
Provisions & Contingencies |
3698.77 |
9574.92 |
Net Profit/(Loss) for the Year before Exceptional Item |
54.99 |
(5871.74) |
Less: Exceptional Item |
0.00 |
0.00 |
Net Profit/(loss) for the year after Exceptional Item |
54.99 |
(5871.74) |
Add-Profit/(Loss) brought forward |
(5871.74) |
0.00 |
Add-Investment Reserve Account |
0.00 |
0.00 |
Net Profit/ (loss) available for appropriation |
(5816.75) |
(5871.74) |
APPROPRIATION |
(5816.75) |
(5871.74) |
Transferred to Statutory Reserve |
13.75 |
0.00 |
Transferred to Revenue and Other reserves |
0.00 |
0.00 |
Transferred to Special Reserve u/s 36(1)(viii) of the Income Tax Act 1961 |
0.00 |
0.00 |
Transferred to Capital Reserve |
31.05 |
0.00 |
Transferred to Investment Reserve Account |
0.00 |
0.00 |
Interim Dividend |
0.00 |
0.00 |
Investment Fluctuation Reserve |
10.19 |
0.00 |
Proposed Dividend |
0.00 |
0.00 |
Tax on Dividend |
0.00 |
0.00 |
Balance carried over to Balance Sheet |
(5871.74) |
(5871.74) |
âFigures in bracket () denote loss.
** The figures of the previous period/year have been regrouped/ rearranged, wherever considered necessary, to conform to current period/yearâs classification.
Board of Directors
During the year FY 2018-19, 14 meetings of Board of Directors, 12 meetings of Management Committee of Board and 12 meetings of Audit Committee of Board, were held. Sh. Himanshu Joshi was Executive Director of the Bank till the date of his superannuation i.e. upto 31st October 2018. Thereafter, Shri Vijay Dube and Shri Balakrishna Alse S were appointed in accordance with Section 9(3)(a) of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 and they assumed charge as Executive Directors of the Bank on 01st November 2018 and 26th December 2018, respectively. Shri S.M. Narasimha Swamy recently joined the Bank as RBI Nominee Director in place of Shri S. Ganesh Kumar w.e.f. 26th April 2019. Further, Smt. Mala Srivastava, Part-Time NonOfficial Director of the Bank laid down office on 24th April 2019 on completion of her tenure.
The Bank places on record its appreciation for the guidance received from Shri Himanshu Joshi, Smt. Mala Srivastava and Shri S. Ganesh Kumar during deliberations of the Board/Committees of the Board and also in the conduct of the Bankâs business during their tenure of office as Directors of the Bank.
Statutory Audit
During the year, the Bank has with the approval of the Reserve Bank of India appointed M/s B C Jain & Co., Kanpur; M/s S N Dhawan & Co. LLP, New Delhi; M/s S.P. Chopra & Co., New Delhi; M/s Batra Deepak & Associates, New Delhi as Statutory Central Auditors of the Bank for FY 2018-19.
Explanations/Comments by the Board of Directors in response to Modified Opinion/Adverse Remarks/Emphasis of Matter, if any, in the Independent Auditorsâ Report N.A.
Secretarial Audit
Pursuant to Regulation 24A of the SEBI Listing Regulations read with SEBI Circular dated 08th February 2019, the Board of Directors appointed M/s. Agarwal S. & Associates, Company Secretaries, as the Secretarial Auditor to conduct Secretarial Audit of the Bank for the financial year ended 31st March, 2019. The Secretarial Audit Report of the Bank is annexed to this Report.
Explanations/Comments by the Board of Directors in response to observation, if any, in the Secretarial Audit Report
In respect of observation made by M/s. Agarwal S. & Associates, Company Secretaries in the Secretarial Audit Report for FY 201819 w.r.t. the composition of the Board of Directors of the listed entity in view of vacancies under section 9(3)(e),(f) & (h) of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980, it is stated that in terms of Section 9(3) of the aforesaid Act, all the directors on the Board are appointed /nominated by the Central Government other than three directors elected by the shareholders of the Bank (other than Central Government). The Bank has through various communications requested the Ministry of Finance, Govt. of India from time to time to nominate directors in respect of the existing vacancies. Further, the position of existing vacancies on the Board is also being apprised to the Ministry on monthly basis.
Corporate Social Responsibility
Bankâs aim is to minimize the impact of business on the environment, have a positive effect on society and seek to work with other NGOs or non-profit charities, development agencies, organizations etc. who embrace these objectives. We aim to use natural resources responsibly, work with community projects and encourage and educate our employees in these goals. Staff members are encouraged to make contributions by understanding the aspirations of underprivileged sections and endeavoring to evolve measures to remove indisputable social and development lacunae. Under the community service various welfare and social activities are undertaken by the Bank both in Banking and non-Banking areas to raise the quality of life of the downtrodden and under privileged sections of the society.
CSR initiatives undertaken by the Bank in FY 2018-19
The Bank undertakes various CSR activities on an ongoing basis which includes training programs at RSETIS for self employment generating activities etc. Bank has also sanctioned TATA ACE TEMPO as a part of community services to NGO for providing assistance to poor and needy.
Directorsâ Responsibility Statement
The Directors confirm that, in preparation of the Annual Accounts for the year ended 31st March, 2019:
- the applicable accounting standards have been followed along with proper explanation relating to material departures, if any,
- the accounting policies framed in accordance with the guidelines of the Reserve Bank of India, were consistently applied,
- reasonable and prudent judgment and estimates were made so as to give true and fair view of the state of affairs of the Bank at the end of financial year and of the profit and loss of the Bank for the year ended on 31st March, 2019,
- proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of applicable laws governing banks in India for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities.
- Internal financial controls were laid down and these were adequate and operating effectively
- Proper systems were in place to ensure compliance of all laws applicable to the Bank and these were adequate and operating effectively
- The accounts have been prepared on a going concern basis.
Acknowledgments
The Board of Directors expresses its gratitude to the Government of India, Ministry of Finance, Department of Economic Affairs, Reserve Bank of India (RBI), Securities and Exchanges Board of India (SEBI) and other Government & Regulatory Agencies for their valuable guidance and continued support provided to the Bank throughout the year. The Board of Directors are also grateful to the valued customers, esteemed stakeholders and also wish to place on record its great appreciation of the staff members for their involvement and dedication in the overall development, growth and prosperity of the Bank.
For and on behalf of the Board of Directors
Place: Gurugram (Mukesh Kumar Jain)
Date: 13th May 2019 Managing Director & CEO
Mar 31, 2018
The Board of Directors have pleasure in presenting the Bankâs Annual Report along with audited accounts for the financial year ended 31s March 2018.
BUSINESS OPERATIONS
The Business of the Bank stood at Rs.3,55,552.07 crore as on 31.03.2018 as against Rs.3,85,777.25 crore as on 31.03.2017. Total deposits of the Bank stood at Rs.2,07,346.06 crore, registering a decline of 5.47%. The gross advances as at end-March 2018 stood at Rs.1,48,206.01 crore, registering a decline of 10.95%. The Credit deposits ratio of the Bank, as at end- March 2018, stood at 71.50%. The Bank ensured adequate flow of credit to the productive sectors of the economy. The Loans & Advances portfolio of the Bank is well diversified and balanced. The Bankâs retail credit increased by 17.03% during FY 2017-18. Net interest margin for FY 2017-18 was 2.19% as against 2.42% for FY 2016-17.
CAPITAL & RESERVES
Pursuant to the PSB Reforms Agenda of Govt. of India, the shareholders of the Bank in the Extraordinary General Meeting held on 15.03.2018 approved, through special resolution, the issue and allotment of 28,65,97,110 equity shares of face value of Rs.10/- each to the Government of India @ Rs.124.60 per share (including premium). The Bank received a sum of Rs.3571.00 crore on 27.03.2018 as contribution of the Central Government for preferential allotment of equity shares and the allotment was effected on 28.03.2018 upon receipt of all regulatory approvals. Accordingly, during FY 2017-18, the Paid-up capital of the bank increased by Rs.286.60 crore and Share Premium by Rs.3284.40 crore. The Capital & Reserves as on March 31, 2018 were at Rs.11,786.76 crore as against Rs.14121.36 crore as at end March 2017 and the ratio of Capital & Reserves to average working funds stood at 4.64 % as on 31.03.2018 as against 5.87% as on 31st March 2017. During the year, the Bank has redeemed four series of Basel III Compliant Additional Tier I Bonds aggregating to Rs.3000.00 crore upon exercise of Call Option by the Bank under âRegulatory Eventâ.
CAPITAL ADEQUACY RATIO
The Bankâs Capital Risk Weighted Assets Ratio (CRAR) as on 31.03.2018 under Basel III Guidelines stood at 10.50 % as against 11.64% as on 31.03.2017.
FINANCIAL PERFORMANCE
The Bank has posted a total income of Rs.20,181.25 crore during the year as against Rs.21,187.85 crore last year. The Operating Profit of the Bank stood at Rs.3,703.18 crore for the year ended 31.03.2018. The Bank has incurred a net loss of Rs.5,871.74 crore during the fiscal 2017-18.
The Financial performance of the Bank is given below:-
(Amt. in Rs. crore)
31.03.2018 |
31.03.2017 |
|
Interest Income |
17398.89 |
18422.33 |
Other Income |
2782.36 |
2765.52 |
Total Income |
20181.25 |
21187.85 |
Interest Paid |
12888.13 |
13512.83 |
Operating Expenses |
3589.94 |
3504.89 |
Total Expenses |
16478.07 |
17017.72 |
Operating Profit |
3703.18 |
4170.13 |
Provisions & Contingencies |
9574.92 |
5264.20 |
Net Profit/(Loss) for the Year before Exceptional Item |
(5871.74) |
(1094.07) |
Less: Exceptional Item |
0.00 |
0.00 |
Net Profit/(loss) for the year after Exceptional Item |
(5871.74) |
(1094.07) |
Add-Profit brought forward |
0.00 |
0.64 |
Add-Investment Reserve Account |
0.00 |
11.54 |
Net Profit/ (loss) available for appropriation |
(5871.74) |
(1081.89) |
APPROPRIATION |
||
Transferred to Statutory Reserve |
0.00 |
0.00 |
Transferred to Revenue and Other reserves |
0.00 |
(1081.89) |
Transferred to Special Reserve u/s 36(1)(viii) of the Income Tax Act 1961 |
0.00 |
0.00 |
Transferred to Capital Reserve |
0.00 |
0.00 |
Transferred to Investment Reserve Account |
0.00 |
0.00 |
Interim Dividend |
0.00 |
0.00 |
Proposed Dividend |
0.00 |
0.00 |
Tax on Dividend |
0.00 |
0.00 |
Balance carried over to Balance Sheet |
(5871.74) |
0.00 |
*Figures in bracket () denote loss.
DIVIDEND
The Bank has been placed under PCA (Prompt Corrective Action) Framework by the Reserve Bank of India vide its letter dt. 05.10.2017. Pursuant to the PCA guidelines, the Board of Directors of the Bank have not recommended any Dividend, for the financial year 2017-18.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Philosophy
- âCorporate Social Responsibility (CSR)â can be referred as corporate initiative to assess and take responsibility for the Bankâs effects on the environment and impact on social welfare. CSR is a way of conducting business, by which corporate entities visibly contribute to the social good.
- Bankâs aim is to minimize the impact of business on the environment, have a positive effect on society and seek to work with other NGOs or non-profit charities, development agencies, organizations etc. who embrace these objectives. We aim to use natural resources responsibly, work with community projects and encourage and educate our employees in these goals.
- Staff members are encouraged to make contributions by understanding the aspirations of underprivileged sections and endeavoring to evolve measures to remove social and development lacunae. This leads to their self development and improvement of Bankâs image besides development of the community. In line with this commitment, from the 26th of January 2018, more than 20,000 employees of the Bank have pledged to contribute Rs.10 each every time a soldier lays his life for the nation. This contribution is made to the Army Welfare Fund Account for the Martyrâs family.
- Under the community service various welfare and social activities are undertaken by the bank both in Banking and non Banking areas to raise the quality of life of the downtrodden and under privileged sections of the society.
- Providing assistance in green initiative, education, health, sports and environment services are the focus areas.
Major CSR initiatives undertaken by the Bank in FY 2017-18
The Bank has been taking various steps/ projects to improve social welfare as part of its CSR activities. The Bank had undertaken various CSR activities during 2017-18 which include distribution of School Uniform, Exhaust Fans, CCTVâs Cameraâs, Mattress, Pillows, Blankets and Utensils to poor and needy children. Bank has also sanctioned a health awareness camp for the women and distributed Solar Lamps to the underprivileged girls.
BOARD OF DIRECTORS
During 2017-18, 13 meetings of Board of Directors, 13 meetings of Management Committee of Board and 9 meetings of Audit Committee of Board, were held. Sh. Animesh Chauhan was Managing Director & CEO of the Bank till the date of his superannuation. i.e. upto 30.06.2017. Thereafter, Sh. Mukesh Kumar Jain, assumed the charge of the Bank as Managing Director & CEO under Section 9(3)(a) of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 on 15.07.2017. Sh. Rajkiran Rai G was Executive Director of the Bank till 30.06.2017 subsequent to which he was elevated as Managing Director & CEO of Union Bank of India. The tenure of all the three shareholder directors i.e. Sh. Dinesh Kumar Agrawal, Sh. Desh Deepak Khetrapal and Sh. Ashok Kumar Sharma completed on 29.09.2017. Sh. Madan Mohan Lal Verma was elected as Shareholder Director on the Board of the Bank along with Sh. Desh Deepak Khetrapal and Sh. Ashok Kumar Sharma who were re-elected for a further period of three years i.e. upto 29.09.2020 in terms of Section 9(3)(i) of the âActâ.
EXPLANATIONS/COMMENTS BY BOARD OF DIRECTORS IN RESPONSE TO MODIFIED OPINION/ADVERSE REMARKS/EMPHASIS OF MATTER, IF ANY, IN THE INDEPENDENT AUDITORSâ REPORT
N.A.
DIRECTORSâ RESPONSIBILITY STATEMENT
The Directors confirm that, in preparation of the Annual Accounts for the year ended 31st March, 2018:
- the applicable accounting standards have been followed along with proper explanation relating to material departures, if any,
- the accounting policies framed in accordance with the guidelines of the Reserve Bank of India, were consistently applied,
- reasonable and prudent judgment and estimates were made so as to give true and fair view of the state of affairs of the Bank at the end of financial year and of the profit and loss of the Bank for the year ended on 31st March, 2018,
- proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of applicable laws governing banks in India for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities.
- Internal financial controls were laid down and these were adequate and operating effectively
- Proper systems were in place to ensure compliance of all laws applicable to the Bank and these were adequate and operating effectively
- The accounts have been prepared on a going concern basis.
ACKNOWLEDGMENTS
The Board of Directors expresses its gratitude to the Government of India, Ministry of Finance, Department of Economic Affairs, Reserve Bank of India (RBI), Securities and Exchanges Board of India (SEBI) and other Government and Regulatory Agencies for their valuable guidance and continued support provided to the Bank throughout the year. The Board of Directors are also grateful to the valued customers, esteemed stakeholders and also wish to place on record its great appreciation of the staff members for their involvement and dedication in the overall development and growth of the Bank.
For and on behalf of the Board
Place: Gurugram (Mukesh Kumar Jain)
Date: 12.05.2018 Managing Director & CEO
Mar 31, 2017
DIRECTORS'' REPORT
The Board of Directors have pleasure in presenting the Bank''s Annual Report along with audited accounts for the financial year ended 31st March 2017.
BUSINESS OPERATIONS
The Business of the Bank stood at Rs,385777.25 crore as on 31.03.2017 as against Rs,362554.20 crore as on 31.03.2016. Total deposits of the Bank stood at Rs,219339.39 crore, registering a growth of 4.99%. The gross advances as at end-March 2017 stood at Rs,166437.86 crore, registering a growth of 8.33%. The Credit deposits ratio of the Bank, as at end- March 2017, stood at 75.92%. The Bank ensured adequate flow of credit to the productive sectors of the economy. The Loans & Advances portfolio of the Bank is well diversified and balanced. Bank''s retail credit increased by 37.15% during FY 2016-17. Net interest margin for FY 2016-17 was 2.42% as against 2.66% for FY 2015-16.
CAPITAL & RESERVES
The Bank had received a sum of Rs,300.00 crore on 30.03.2016 as contribution of the Central Government for preferential allotment of equity shares pending allotment. The shareholders of the Bank in the Extraordinary General Meeting held on 02.05.2016 approved, through special resolution, the issue and allotment of 24772914 equity shares of face value of Rs,10/- each to the Government of India @ Rs,121.10 per share (including premium). Consequently, during FY 2016-17, the Paid-up capital of the bank increased by Rs,24.77 crore and Share Premium by Rs,275.23 crore. The Capital & Reserves as on March 31, 2017 have gone up to Rs,14121.36 crore as against Rs,14941.15 crore as at end March 2016 and the ratio of Capital & Reserves to average working funds stood at 5.87% as on 31.03.2017 as against 6.54% as on 31st March 2016. During the year, the Bank has issued Basel III Compliant Tier II Bonds aggregating to Rs,1000 crore and Basel III Compliant Additional Tier I Bonds aggregating to Rs,1500 crore.
CAPITAL ADEQUACY RATIO
The Bank''s Capital Risk Weighted Assets Ratio (CRAR) as on 31.03.2017 under Basel III guidelines stood at 11.64% as against
11.76% as on 31.03.2016. The Bank''s Capital Risk Weighted Assets Ratio (CRAR) under Basel II stood at 12.57% as on 31.03.2017 as against 12.80% as on 31.03.2016.
FINANCIAL PERFORMANCE
The Bank has posted a total income of Rs,21187.85 crore during the year as against Rs,21934.78 crore last year. The Operating Profit of the Bank stood at Rs,4170.13 crore for the year ended 31.03.2017. The Bank has incurred a net loss of Rs,1094.07 crore during the fiscal 2016-17.
The Financial performance of the Bank is given below:
Financial Performance (Amt. in Rs, crore)
31.03.2017 |
31.03.2016 |
|
Interest Income |
18422.33 |
20168.50 |
Other Income |
2765.52 |
1766.28 |
Total Income |
21187.85 |
21934.78 |
Interest Paid |
13512.83 |
14793.93 |
Operating Expenses |
3504.89 |
3458.78 |
Total Expenses |
17017.72 |
18252.71 |
Operating Profit |
4170.13 |
3682.07 |
Provisions & Contingencies |
5264.20 |
3525.99 |
Net Profit/(loss) for the Year before Exceptional Item |
(1094.07) |
156.08 |
Less: Exceptional Item |
0.00 |
0.00 |
Net Profit/(loss) for the year after Exceptional Item |
(1094.07) |
156.08 |
Add-Profit brought forward |
0.64 |
0.14 |
Add-Investment Reserve Account |
11.54 |
42.26 |
Net Profit/ (loss) available for appropriation |
(1081.89) |
198.48 |
APPROPRIATION |
||
Transferred to Statutory Reserve |
0.00 |
40.00 |
Transferred to Revenue and Other reserves |
(1081.89) |
0.00 |
Transferred to Special Reserve u/s 36(1) (viii) of the Income Tax Act 1961 |
0.00 |
112.00 |
Transferred to Capital Reserve |
0.00 |
18.76 |
Transferred to Investment Reserve Account |
0.00 |
0.00 |
Interim Dividend |
0.00 |
0.00 |
Proposed Dividend |
0.00 |
22.50 |
Tax on Dividend |
0.00 |
4.58 |
Balance carried over to Balance Sheet |
0.00 |
0.64 |
DIVIDEND
In view of the net loss of Rs,1094.07 crore during the fiscal, the Board of Directors of the Bank has not recommended any Dividend, for the financial year 2016-17.
PROJECT UDBHAV
During FY 2016-17, your Bank has embarked upon an ambitious and challenging journey of ''Re-modeling of the Bank''s Organization and Operational Structure'' - Project Udbhav to grow in terms of business, profitability, level of compliance and outreach. Project Udbhav aims to achieve Business Growth with enhanced focus on Sales and reduced turnaround time
(TAT), build business ownership, enhance Customer Service & Satisfaction, boost Operational Efficiency and strengthen Compliance function.
The three Pillars of Project Udbhav are (1) Business Processes & Operating Model, (2) Organization Structure and (3) Branch Transformation.
Business Processes & Operating Model: Business processes and operating model have been re-engineered so as to remove redundant and duplicate activities and bring about effectiveness and efficiency. Besides, the power of data is being harnessed under Business Analytics to improve cross selling abilities across customer segments.
Organization Structure: Creation of a flattened Organization Structure based on Functional Specialization whereby sanctioning of credit facilities is done at two levels only i.e., Cluster Office and Head Office. The majority of retail loans and commercial loans up to Rs,10 Crore are sanctioned at Cluster Office level that ensures quick decision making and reduction of turnaround time (TAT).
Besides, specialized verticals have been established to cater to Corporate Business i.e., Mid Corporate Business and Large Corporate Business. Mid Corporate Branches have been established at 48 centres to cater to Mid Corporate Borrowers
i.e., borrowers availing more than Rs,10 Crore and up to Rs,50 Crore while Large Corporate Branches have been established at 5 centres to cater to Large Corporate Borrowers i.e., borrowers availing more than Rs,50 Crore.
A specialized Vertical, Customer Relations Group (CRG) have been established for garnering institutional CASA while dedicated Resolution, Recovery & Law (RR&L) Vertical has been constituted for carrying out recovery & resolution activities in case of borrowers classified as NPA.
Branch Transformation: The branch is an integral channel for business sourcing and plays a pivotal role in providing customer service and establishing brand value of the Bank in local geography by nurturing relationships at the grass root level. Under Branch Transformation, the Branch layout & infrastructure is being redesigned so as to enrich the customer experience with state of art ambience and technology. Further, delineation of the role & responsibilities of the Branch Officials shall enable them to focus on Sales & Marketing and drive efficiency. 500 branches have been covered under the first phase of Branch Transformation.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Philosophy
- Bank is a corporate citizen, with resources at its command and benefits, which it derives from operating in society in general. It therefore has a commitment to give back to the community where it operates and owes a solemn duty to the
less fortunate and underprivileged sections of the society.
- Staff members are encouraged to make contributions by understanding the aspirations of underprivileged sections and endeavoring to evolve measures to remove indisputable social and development lacunae. This leads to their self development and improvement of Bank''s image besides development of the community.
- Under the community service various welfare and social activities are undertaken by the bank both in Banking and non Banking areas to raise the quality of life of the downtrodden and under privileged sections of the society.
- Providing assistance on education, health, sports and environment services are the focus areas.
Major CSR initiatives undertaken by the Bank in FY 2016-17
The Bank has been taking various steps/projects to improve social welfare as part of its CSR activities. The main activities undertaken during 2016-17 include installation of water coolers, RO systems, donation of chairs, uniforms, blankets, invertor, computers to various organizations/trusts/institutes etc. Further, Bank has also taken initiatives for Cleaning of ''Lal Ghat'' & ''Hanuman Garhi Ghat'' at river Ganga, Varanasi by adopting these holy areas and distributed Tulsi sapling on the occasion of 75th Foundation day to valuable customers of the Bank.
BOARD OF DIRECTORS
During 2016-17, 13 meetings of Board of Directors, 14 meetings of Management Committee of Board and 8 meetings of Audit Committee of Board, were held. Smt. Mala Srivastava and Sh. Sanjay Kapoor joined the Board of the Bank as Part-time Non-official Directors on 25.04.2016 and 26.07.2016 in terms of Section 9(3)(h) and 9(3)(g) of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (the ''Act''), respectively. Sh. Himanshu Joshi joined the Board as Executive Director in terms of Section 9(3)(a) of the Act on 09.08.2016. Sh. Kingshuk Bhattacharya, Workmen Employee Director and Narendra J Kotiawala, Officer Employee Director vacated their office on the Board of the Bank on 13.06.2016 and 29.01.2017 on completion of tenure as Directors of the Bank. Sh Prashant Goyal joined the Board of the Bank as Government of India Nominee Director on 16.01.2017 in place of Sh. Arunish Chawla in terms of Section 9(3)(b) of the Act.
EXPLANATIONS/COMMENTS BY BOARD OF DIRECTORS IN RESPONSE TO MODIFIED OPINION/ADVERSE REMARKS/ EMPHASIS OF MATTER, IF ANY, IN THE INDEPENDENT AUDITORSâ REPORT
Nil
DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors confirm that, in preparation of the Annual Accounts for the year ended 31st March, 2017:
- the applicable accounting standards have been followed along with proper explanation relating to material departures, if any,
- the accounting policies framed in accordance with the guidelines of the Reserve Bank of India, were consistently applied,
- reasonable and prudent judgment and estimates were made so as to give true and fair view of the state of affairs of the Bank at the end of financial year and of the profit and loss of the Bank for the year ended on 31st March, 2017,
- proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of applicable laws governing banks in India for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities.
- Internal financial controls were laid down and these were adequate and operating effectively
- Proper systems were in place to ensure compliance of all laws applicable to the Bank and these were adequate and operating effectively
- The accounts have been prepared on a going concern basis.
ACKNOWLEDGMENTS
The Board of Directors expresses its gratitude to the Government of India, Ministry of Finance, Department of Economic Affairs, Reserve Bank of India (RBI), Securities and Exchanges Board of India (SEBI) and other Government & Regulatory Agencies for their valuable guidance and continued support provided to the Bank throughout the year. The Board of Directors are also grateful to the valued customers, esteemed stakeholders and also wish to place on record its great appreciation of the staff members for their involvement and dedication in the overall development, growth and prosperity of the Bank.
For and on behalf of the Board
Place: Gurugram (ANIMESH CHAUHAN)
Date: 12.05.2017 MANAGING DIRECTOR & CEO
Mar 31, 2015
Dear Members,
The Board of Directors have pleasure in presenting the Bank''s Annual
Report along with audited accounts for the year ended 31st March 2015.
1. BUSINESS OPERATIONS
The Business of the Bank stood at Rs. 352048.72 crore as on 31st March,
2015 as against Rs.334254.04 crore in the previous year. Total deposits
of the Bank stood at Rs.204009.70 crore and have shown an increase of
Rs.10520.74 crore depicting a growth of 5.44%. Cost of deposits stood at
7.69% for the fnancial year 2014-15 as against 7.67% for fnancial year
2013-14. The Bank was cautious in procuring high cost bulk deposits
during the year and as a result of the same, the ratio of bulk deposits
has decreased from 18.19% as on 31.03.2014 to 15.93% as on 31.03.2015.
On the other hand, net advances as at end-March 2015 stood at
Rs.145261.30 crore, registering a growth of 4.44%. During the fscal
2014-15, yield on advances has decreased to 11.73% from previous year''s
level of 11.94%. However, the Bank has taken measures to improve yield
on advances through lending to SME, Mid Corporate and Retail sector
which shall improve the yield on advances, in the current year.
The credit deposit ratio of the Bank, as at end-March 2015, stood at
72.59%. The Bank ensured adequate flow of credit to the productive
sectors of the economy. The Loans and Advances portfolio of the Bank is
well diversifed and balanced.
2. CAPITAL AND RESERVES
The Bank transferred a sum of Rs. 378.80 crore to Reserves (comprising
Rs.124 crore transferred to Statutory Reserves, Rs.198 crore to Special
Reserve under The Income Tax Act 1961, Rs.3 crore to Revenue and Other
Reserves and Rs.53.80 crore to Investment Reserve) out of the Profit for
the year 2014-15. With this, capital and reserves as on March 31, 2015
have gone upto Rs.13779.35 crore as against Rs.13430.67 crore as at end
March 2014 and the ratio of Capital and Reserves to average working
funds stood at 6.36% as on 31.03.2015 as against 6.60% as on 31st March
2014. During the year, the Bank has issued Basel III Compliant Tier II
Bonds aggregating to Rs.1000 crore and Basel III Compliant Perpetual Debt
Instruments (AT1Bonds) amounting to Rs.500 crore.
3. CAPITAL ADEqUACY RATIO
The Bank''s Capital Risk Weighted Assets Ratio (CRAR) as on 31.03.2015
under Basel III guidelines stood at 11.41% as against 11.01% as on
31.03.2014. The Bank''s Capital Risk Weighted Assets Ratio (CRAR) under
Basel II as on 31.03.2015 stood at 12.28% as against 11.85% as on
31.03.2014. This is above the regulatory minimum requirement of 9%.
4. FINANCIAL PERFORMANCE
The Bank has posted a total income of Rs. 22082.78 crore during the year
as against Rs. 20962.75 crore last year thus registering an increase of
Rs.1120.03 crore showing a growth of 5.34% during the fscal 2014-15. The
Operating Profit of the Bank has increased to Rs.4227.07 crore as against
Rs.4155.49 crore last year. The Bank has earned a net Profit of Rs.497.08
crore during the fscal 2014-15.
Financial performance including appropriation from the Net Profit is
given below:-
FINANCIAL PERFORMANCE (AMT. IN Rs. CRORE)
31.03.2015 31.03.2014
Interest Income 19961.38 19017.48
Other Income 2121.40 1945.27
Total Income 22082.78 20962.75
Interest Paid 14877.19 13890.38
Operating Expenses 2978.52 2916.88
Total Expenses 17855.71 16807.26
Operating Profit 4227.07 4155.49
Provisions and Contingencies 3449.56 3016.08
Net Profit for the Year before 777.51 1139.41
Exceptional Item - -
Less: Exceptional Item 280.43 0.00
(Reversal of Income for FY
2013-14)
Net Profit for the year after 497.08 1139.41
Exceptional Item - -
Add-Profit brought forward 0.96 0.17
Add-Investment Reserve Account 0.00 5.22
Net Profit available for 498.04 1144.80
appropriation
APPROPRIATION
Transferred to Statutory Reserve 124.00 285.00
Transferred to Revenue and 3.00 333.00
Other reserves
Transferred to Special Reserve u/s 198.00 259.00
36(1)(viii) of The
Income Tax Act 1961
Transferred to Capital Reserve 0.00 0.23
Transferred to Investment 53.80 0.00
Reserve Account - -
Interim Dividend 0.00 119.94
Proposed Dividend 98.96 107.94
Tax on Dividend 20.14 38.73
Balance carried over to Balance 0.14 0.96
Sheet
5. DIVIDEND
Bank''s policy of declaring dividend is to reward the share holders as
well as to plough back Profit for maintaining a healthy capital adequacy
ratio and for supporting future growth. Accordingly, your Directors
are pleased to propose a dividend of 33% (i.e. Rs.3.30 per share) for the
fnancial year ended 31st March, 2015 as against 76.00% [i.e. Rs.7.60 per
share (interim dividend @ Rs.4.00 per share and fnal dividend @ Rs.3.60 per
share)] paid for the preceding year.
6. RISK MANAGEMENT
The Bank has Board approved policies in place for identifying,
assessing, managing and mitigating various risks in the Bank which
includes Loan Policy, Credit Risk Management Policy, Asset Liability
Management, Liquidity Risk Management Policy and Market Risk Management
Policy, Operational Risk Management Policy, Disclosure Policy,
Compliance Policy, Internal Capital Adequacy Assessment Process (ICAAP)
Policy, Integrated Treasury Policy and Stress Testing Policy, Credit
Risk Mitigations and Collateral Management Policy, Policy guidelines of
Delegated Powers for loans and advances, Integrated Risk Management
Policy, Recovery Policy, Business Continuity Plan and Disaster Recovery
Policy, Audit Policies, KYC and AML Policy and Customer Service Policy
etc. Further the systems and procedures for risk management are
detailed in the Management Discussion and Analysis annexed to this
Report.
7. CORPORATE SOCIAL RESPONSIBILITY
Corporate Philosophy
y Bank is a corporate citizen, with resources at its command and
benefits, which it derives from operating in society in general. It
therefore has a commitment to give back to the community where it
operates and owes a solemn duty to the less fortunate and
underprivileged sections of the society.
y Staff members are encouraged to make contributions by understanding
the aspirations of underprivileged sections and endeavoring to evolve
measures to remove indisputable social and development lacunae. This
will lead to their self-development and improvement of Bank''s image
besides development of the community.
y Under the community service banking, various welfare and social
activities are undertaken by the bank both in Banking and non-Banking
areas to uplift the quality of life of the downtrodden and under
privileged sections of the society.
y The focus of the Bank remains on education, health, sports and
environment services.
Major initiatives undertaken by the Bank in FY 2014-15
The Bank has a Board approved Policy on Corporate Social
Responsibility. A Committee has been constituted by the Board for the
purpose of focusing / reviewing the CSR activities being undertaken by
the Bank.
The Bank has undertaken various CSR initiatives under following
categories:
Swachch Vidayalaya Campaign: The Bank has earmarked an amount of
Rs.2.00 crore for constructing toilets in various Government schools. The
construction is being done at Pan India level on priority and as
focused CSR activity, leading towards the dream of a "Clean and Safe"
India. During the year Bank has completed the construction of more than
227 Toilets in 177 Government Schools across the Country.
Prime Minister National Relief Fund: An amount of Rs.2.40 crores
contributed by Staff towards Prime Minister National Relief Fund for
undertaking relief works in Flood affected areas of J&K.
The Bank has participated in the noble cause of renovation and
maintenance of PTC (Primary Teacher''s College) Building of Sabarmati
Harijan Ashram Trust, Ahmedabad. The Building is used for teaching the
poor and needy students of the society.
The Bank Created OBC-NIBM (National Institute of Bank Management)
Endowment Chair on Financial Inclusion to provide strong academic
leadership along with development of research programme for curriculum
development.
To strengthen Financial Inclusion Initiative, the research work was
initiated in association with NIBM, Pune and Bank on "Study on
Effectiveness of Financial Inclusion Initiatives of our Bank".
The Bank has donated a School Bus for commutation purpose of poor and
needy students of ''Saraswati Shishu Mandir Shiksha Samiti, Meerut''.
The Bank has donated Water Coolers for providing fresh and cool
drinking water to the students/ teachers of MLM Public School, Ferozpur
Cantt, Krishna Vatika School Village Bhokhra, District Bathinda and
Government High School, Topra Kalan.
The Bank adopted 10 poor and needy girl children of St. Michael''s
Hostel, Jangpura, New Delhi for fulflling their educational, medical
and other needs.
The Bank contributed towards repair / renovation of toilets, awarded
scholarships, provided benches to Government Schools, installed
Hand-pumps in Benti Village, Lucknow which has been adopted by
Honorable Home Minister, Government of India under Saansad Adarsh Gram
Yojana.
In coordination with "Yogada Satsanga Society of India, Kolkata" the
Bank distributed School Bags, RO Purifer, Benches and computers for
their School at Ranchi.
To help the students to continue their studies, the Bank donated
Hearing Aids to poor ''deaf and dumb'' students of ''Umang Bal Vikas,
Patna''.
Donated Benches / Desks and Solar Lamp to two schools of Kasturba
Gandhi Junior Residential Girls School at Village Gangoh and Village
Tiwiaya, Saharanpur, Uttar Pradesh.
Donated Computers along with UPS System, Sewing Machines, Solar
batteries and Cycles, through Jagruti - A social Venture by Oriental
Bank Family in association with Navjyoti India Foundation at its
Project Site office at Dhumaspur Road, Nayagaon (Bhondsi), Gurgaon.
Donated medical equipments, food items, medicines and other utility
items for rehabilitation of persons of ''The Earth Saviours Foundation,
New Delhi'', who were displaced due to fre.
Under its ongoing CSR initiatives, the Bank donated Medicines etc. to
Leprosy Patients and Track Suits for children of Divya Prem Sewa
Mission, Haridwar.
Donated Water Head Tanks, Aqua Guards and Water Cooler to Mother
Teresa Saket Orthopedics Hospital, Panchkula.
The Bank donated Water Cooler and RO system for visitors and staff of
BDPO office, Radaur, District Yamuna Nagar.
For the benefit of poor and needy patients the Bank donated an
E-Mobile Clinic van to ''Medanta-The Medicity, Gurgaon'' and an Ambulance
to ''All India Pingalwara Charitable Society'', Amritsar.
The Bank donated three Veterinary Ambulances to Shree Sadguru Datta
Dharmik Evam Parmarthik Trust, Indore. The Ambulances shall be utilized
under their ongoing project ''JEEVDAYA'' for taking care of injured,
stray cattle on the streets.
The Bank donated four LED TV Screens to Shri Mahakaleshwar Temple,
Ujjain which displays the schedule of events, timings of Aartis etc. to
the pilgrims who visit the Mandir premises.
The Bank displayed Boards in the premises of ''Arulmigu Dhandayidapani
Swami Temple, Palani, Tamil Nadu which shows Darshan and ticket details
etc. of Temple activities for the benefit of pilgrims.
The Bank donated stationery, clothes and other utility items to
widows and their children in cooperation with ''Swargiya Smt. Durga Devi
Charitable Trust, Mathura''.
The Bank has provided fnancial literacy under Pradhan Mantri Jan Dhan
Yojna (PMJDY).
The Bank has provided Skill Development Training to 3914 rural youth
through Rural Self Employment Training Institute (RSETIs).
Green Initiatives to mitigate pollution
Under the Green Initiatives and to mitigate the pollution, Bank has
planted saplings in Kolkata in association with Concern India
Foundation, Kolkata.
The Bank contributed in cleaning the Dashashavghat at Varanasi by way
of donation for clean and pollution free Ganga in coordination with
Gangotri Sewa Samiti.
The Bank planted saplings along with Tree Guards on Road Divider in
Sriganganagar which will help to provide green cover to mitigate
pollution.
8. CORPORATE GOVERNANCE AND INSIDER TRADING
Securities and Exchange Board of India vide circular dated 17th April
2014 and 15th September 2014 amended clauses 35B and 49 of the Listing
Agreement. In terms of Clause
35B, the Bank provided e-voting facility to its shareholders, in
respect of shareholders'' resolutions, passed at the Annual General
Meeting and Extra-ordinary General Meeting of the Bank held during the
year 2014-15.
Pursuant to Clause 49 of the Listing Agreement, besides other
compliances, the Bank has framed a Policy on Related Party Transactions
and Whistle Blower Policy which are available on the website of the
Bank https://www.obcindia.co.in
Whistle Blower Mechanism
In compliance with Clause 49 of the Listing Agreement and Government of
India Resolution on "Public Interest Disclosures and Protection of
Informer" (PIDPI), the Bank has framed a Whistle Blower Policy to
establish a vigil mechanism for stakeholders of the Bank including
directors and employees so as to report concerns about unethical
behaviour, actual or suspected fraud or violation of the Bank''s code of
conduct or ethics policy.
The mechanism also provides for adequate safeguards against
victimization of those who avail of the mechanism. The Reporting
Authority at the Bank level is the Chief Vigilance officer and in
exceptional cases, direct access to the Chairman of the Audit Committee
has been made available. The Audit Committee of the Board reviews the
functioning of the Whistle Blower Mechanism on quarterly basis.
Further, the details of the Whistle Blower Mechanism have been made
available on the website of the Bank.
Insider Trading codes
The Securities and Exchange Board of India (SEBI) notifed the SEBI
(Prohibition of Insider Trading) Regulations, 2015 on 15th January 2015
effective from 15th May 2015 and repealed SEBI (Prohibition of Insider
Trading) Regulations, 1992 effective that date.
In conformity with new Regulations, the Bank has framed a comprehensive
Code of Conduct for Regulating, Monitoring and Reporting of Trading by
Insiders and a Code of Practices and Procedures for Fair Disclosure of
Unpublished Price Sensitive Information which are available on the
Bank''s website https://www.obcindia.co.in
9. BOARD OF DIRECTORS
During 2014-2015, 16 meetings of Board of Directors, 19 meetings of
Management Committee of Board and 10 meetings of Audit Committee of
Board, were held.
Sh. S L Bansal was the Chairman and Managing Director of the Bank for
the Financial Year 2014-15 till the date of his superannuation i.e.,
upto 30.09.2014. Thereafter, on 31.12.2014, Sh. Animesh Chauhan assumed
the charge of the Bank as Managing Director and Chief Executive officer
under Section 9(3) (a) of The Banking Companies (Acquisition and
Transfer of Undertakings) Act, 1980.Sh. Rajat Sachar who joined the
Board of the Bank as Government of India Nominee Director on 16.04.2014
laid down the office with the appointment of Sh. Rajan Kumar as
Government of India Nominee Director under Section 9(3)(b) of the
Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980
pursuant to Notifcation dated 12.09.2014. Sh. S Ganesh Kumar, joined
the Board of the Bank on 10.06.2014 as RBI Nominee Director under
Section 9(3)(c) of the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1980. Sh. Desh Deepak Khetrapal, Sh. Ashok Kumar
Sharma and Sh. Dinesh Kumar Agrawal, joined the Board of the Bank on
30.09.2014 as Shareholder Directors under Section 9(3) (i) of the
Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980.
Sh. M.S. Sahoo, Part-time Non-offcial Director of the Bank appointed
under Section 9(3) (h) of the Banking Companies (Acquisition and
Transfer of Undertakings) Act, 1980 on 12.12.2013 vacated his office on
27.03.2015.
10. EXPLANATION/COMMENTS BY THE BOARD OF DIRECTORS IN RESPONSE TO
qUALIFICATIONS/ ADVERSE REMARKS/EMPHASIS OF MATTER IF ANY, IN THE
AUDITORS'' REPORT
In respect of Pt. 7 (i) - The Pension Trusts are permitted to invest in
Bank Bonds/deposits. The plan assets of the pension and gratuity fund
include investments made in Bank''s own Bonds (minimum ''A'' rated) /
Deposits as per prevailing practice followed by the banking industry.
The observation has no impact on the fnancial statements. After April,
2012 the Trusts have not invested funds in Bank''s own Bonds/deposits
and funds are now being placed in other banks.
In respect of Pt. 7 (ii) ÂThe Bank has made a provision of Rs.24.46 crore
being one-fourth of the outstanding during the quarter ended 31.03.2015
and the balance provision of Rs.73.39 crore will be made in the next
three quarters in terms of RBI circular No.RBI / 2014 Â 15 / 535
DBR.No.BP.BC.83 /21.04.048 / 2014-15 dated 01.04.2015.
11. DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors confrm that, in preparation of the Annual Accounts for
the year ended 31st March, 2015:
-the applicable accounting standards have been followed along with
proper explanation relating to material departures, if any,
- the accounting policies framed in accordance with the guidelines of
the Reserve Bank of India, were consistently applied,
- reasonable and prudent judgment and estimates were made so as to give
true and fair view of the state of affairs of the Bank at the end of
fnancial year and of the Profits of the Bank for the year ended 31st
March, 2015,
- proper and sufficient care was taken for the maintenance of adequate
accounting records in accordance with the provisions of applicable laws
governing banks in India and for preventing and detecting frauds and
other irregularities.
- internal fnancial controls were laid down and these were adequate and
operating effectively
- proper systems were in place to ensure compliance of all laws
applicable to the Bank and these were adequate and operating
effectively
- the accounts have been prepared on a going concern basis.
12. ACKNOWLEDGEMENTS
The Board of Directors expresses its gratitude to the Government of
India, Ministry of Finance, Department of Financial Services, Reserve
Bank of India (RBI), Securities and Exchange Board of India (SEBI) and
other Government and Regulatory Agencies for their valuable guidance
and continued support provided to the Bank throughout the year. The
Board of Directors is also grateful to the valued customers, esteemed
shareholders, stakeholders and public at large for their patronage and
confdence reposed in the Bank.
The Board of Directors wishes to place on record its great appreciation
of the commitment, sense of involvement and dedication exhibited by
each staff member in the overall development, growth and prosperity of
the Bank and looks forward to their continued support and whole-hearted
co-operation for realization of the corporate goals in the year ahead.
For and on behalf of the Board
Place: Gurgaon (ANIMESH CHAUHAN)
Date: 14.05.2015 MANAGING DIRECTOR & CEO
Mar 31, 2014
1. BUSINESS OPERATIONS
The Business of the Bank stood at Rs.334254.04 crores as on 31st March,
2014 as against Rs.306083.69 crores in the previous year. Total deposits
of the Bank stood at Rs.193488.96 crores and have shown an increase of
Rs.17591.44 crore depicting a growth of 10.00%. Cost of deposits stood at
7.67% for the financial year 2013-14 as against 7.90% for financial year
2012-13. The Bank was cautious in procuring high cost bulk deposits
during the year and as a result of the same, the ratio of bulk deposits
has decreased from 20.26% as on 31.03.2013 to 18.19% as on 31.03.2014.
On the other hand, net advances as at end-March 2014 stood at
Rs.139079.84 crore, registering a growth of 7.85%. During the fiscal
2013-14, yield on advances has decreased to 11.94% from previous year''s
level of 12.27%. However, the Bank has taken measures to improve yield
on advances through lending to SME, Mid Corporate and Retail sector in
the current year.
The credit deposit ratio of the Bank, as at end-March 2014, stood at
72.91%. The Bank ensured adequate fow of credit to the productive
sectors of the economy. The Loans & Advances portfolio of the bank is
well diversified and balanced.
2. CAPITAL & RESERVES
During the year, the Bank has raised Equity Capital by way of
preferential allotment of shares to the Government of India by issuing
8087561 equity shares of Rs.10.00 each at an issue price of Rs.185.47 per
share aggregating to Rs.150.00 crore on 12.12.2013 thus increasing the
paid-up capital to Rs.299.85 crore. Further, the bank transferred a sum
of Rs.877.23 crore to Reserves (comprising Rs.285.00 crore transferred to
Statutory Reserves, Rs.259.00 crore to Special Reserve under IT Act,
Rs.333.00 crore to Revenue and Other Reserves and Rs.0.23 crore to Capital
Reserve) out of the profit for the year 2013-14. With this, capital &
reserves as on March 31, 2014 have gone upto Rs.13430.67 crore as against
Rs.12775.54 crore as at end March 2013 and the ratio of Capital &
Reserves to average working funds stood at 6.60% as on 31.03.2014 as
against 6.87% as on 31st March 2013.
3. CAPITAL Adequacy RATIO
The Bank''s Capital Risk Weighted Assets Ratio (CRAR) as on 31.03.2014
under Basel III guidelines stood at 11.01%. The Bank''s Capital Risk
Weighted Assets Ratio (CRAR) under Basel II stood at 11.85% as against
12.04% as on 31.03.2013. This is above the regulatory minimum
requirement of 9%.
4. FINANCIAL PERFORMANCE
The Bank has posted a total income of Rs.20962.75 crore during the year
as against Rs.19359.49 crore last year thus registering an increase of
Rs.1603.26 crore showing a growth of 8.28% during the fiscal 2013-14.
Operating Profit of the Bank has increased to Rs.4155.49 crore as against
Rs.3690.69 crore last year showing a growth of 12.59% The Bank has earned
a net profit of Rs.1139.41 crore during the fiscal 2013-14.
Financial performance including appropriation from the Net Proft is
given below:-
TABLE 1: FINANCIAL PERFORMANCE (AMT Rs. IN CRORE)
31.03.2014 31.03.2013
Interest Income 19017.48 17704.78
Other Income 1945.27 1654.71
Total Income 20962.75 19359.49
Interest Paid 13890.38 13003.62
Operating Expenses 2916.88 2665.18
Total Expenses 16807.26 15668.80
Operating Profit 4155.49 3690.69
Provisions & Contingencies 3016.08 2362.74
Net Profit 1139.41 1327.95
Add-Profit brought forward 0.17 0.49
Add-Investment Reserve Account 5.22 0.00
Net Profit available for
appropriation 1144.80 1328.44
APPROPRIATION
Transferred to Statutory Reserve 285.00 332.00
Transferred to Revenue and Other 333.00 442.00
reserves
Transferred to Special Reserve u/s 259.00 223.00
36(1) (viii) of I-T Act
Transferred to Capital Reserve 0.23 12.01
Transferred to Investment Reserve 0.00 5.22
Account
Proposed Dividend Including interim 227.88 268.42
dividend during the FY 2013-14
Tax on Dividend 38.73 45.62
Balance carried over to Balance Sheet 0.96 0.17
5. DIVIDEND
Bank''s policy of declaring dividend is to reward the share holders as
well as to plough back profit for maintaining a healthy capital adequacy
ratio & for supporting future growth. Accordingly, based on the
performance of the Bank up to 30.09.2013, the Bank has all ready paid an
interim dividend of Rs.4.00 per share (40%) in January 2014 and now your
Directors are pleased to propose final dividend of Rs.3.60 per share
thereby aggregating dividend of Rs.7.60 per share (76 %) for the full
year ended 31st March, 2014.
6. RISK MANAGEMENT
The Bank has Board approved policies in place for assessing, managing
and mitigating various risks in the Bank which includes Loan Policy,
Credit Risk Management Policy, Asset Liability Management and Market
Risk Policy, Operational Risk Management Policy, Disclosure Policy,
Compliance Policy, Internal Capital Adequacy Assessment Process (ICAAP)
Policy, Stress Testing Policy, Credit Risk Mitigations & Collateral
Management policy, Policy guidelines of Delegated Powers for loans &
advances, Integrated Risk Management
Policy, Recovery Policy, Business Continuity Plan & Disaster Recovery
Policy, Audit Policies, KYC-AML Policy and Customer Service Policy etc.
Further the systems and procedures for risk management are detailed in
the Management Discussion and Analysis annexed to this Report.
7. CORPORATE SOCIAL RESPONSIBILITY
The Bank has Board approved Policy on Corporate Social Responsibility
in place with a thrust on the philosophy that Bank is a corporate
citizen, with resources at its command and benefits, which it derives
from operating in society in general. It therefore has a commitment to
give back to the community where it operates and owes a solemn duty to
the less fortunate and underprivileged sections of the society. The
Staff members are encouraged to make contributions by understanding the
necessities of underprivileged sections and endeavoring to evolve
measures to remove undisputable social and development lacunae which
will lead to their self development and improvement of Bank''s image
besides development of the community. Under the community service
Banking, various welfare and social activities are undertaken by the
bank both in Banking and non Banking areas to raise the quality of life
of the downtrodden and under privileged sections of the society besides
providing assistance on education, health and environment services.
8. MAJOR CSR INITIATIVES UNDERTAKEN BY THE BANK IN FY 2013-2014
- The Bank donated Rs.5 lacs for the Govt. High School at Milaganoor for
construction of school compound wall. Further, Wheelchairs were also
donated to the physically handicapped persons in Milagnoor.
- All the employees of the Bank contributed Rs.2.15 Crore to the Prime
Minister''s National Relief Fund by donating their one day''s salary to
help the food victims of Uttarakhand. Besides, the Bank organised camps
in Kedarnath & Badrinath and provided food, medicines, mineral water
and other sorts of help to the persons affected by the calamity.
- During the current year, the Bank has provided 6700 ceiling fans to
Govt. Primary Schools located in rural centres.
- In 23 financial inclusion villages and other rural areas, water
purifiers, water coolers, schoolbags, hand pumps, stitching machines,
benches & chairs have been provided.
- The Bank has continued with various CSR/Welfare activities like
distribution of books to poor blind students, free medical treatment
for the poor and needy, donation of Ambulances, Vans, DG Sets,
Computers, Water Coolers and support to Mid Day Meal programmes, Tree
Plantation, Benches at Parks, Construction of Toilets, etc.
- Distributed Solar Power lanterns to the students in Rural / SU
centres in Banglore region under ''Light for Education'' programme.
- For the development of the sports activities among the school going
children, support has been given to "Subroto Cup International Football
Tournament" and also to "Sub-Junior Under 15 Girls National Hockey
Championship" at Bassi Pathana in Punjab.
- The Bank has adopted 10 orphan Girl Children from St. Michael''s
Hostel, and has paid for their Boarding, Lodging, Education, Medical,
and other needs.
- The Bank has donated 70 Tricycles to poor and disabled persons in
Mathura. The Bank has re-constructed and adopted the "Female Surgical
Ward'' at Civil Hospital Sriganganagar which gives relief to patients
- The Bank donated an eleven seater Electric van for transportation of
elderly pilgrims visiting ''Khole Ke Hanumanji'', Jaipur.
On the Bank''s 72nd Foundation Day the Bank organized various CSR
activities:
- Blood Donation Camps & Health Check up camps - The Bank organized a
large number of Blood Donation and health check-up Camps on Pan India
basis.
- Activities in Rural and semi-urban areas - In 400 primary Health
Centers in rural areas, 1006 Wheel Chairs, 303 Stretchers & 340 Settees
were donated.
- Medical Equipments - The Bank also provided medical equipments to
Hospital run by Rama Krishna Mission in Bhubneshwar
- Activities in the primary schools in rural and semi- urban areas - In
the primary Schools, Stationery items were distributed among students &
Water-cooler were installed.
- Solar Lights - On this occasion, the Bank also installed solar lights
in 21 (twenty one) villages under Lucknow Region.
9. BOARD OF DIRECTORS
During 2013-2014, 15 meetings of Board of Directors, 17 meetings of
Management Committee of Board, 8 meetings of Audit Committee of Board,
were held.
Sh. S L Bansal was the Chairman and Managing Director for the Financial
Year 2013-14. Sh. Suresh N Patel, joined the Board of the Bank as
Executive Director under Sec 9 (3) (a) of the Banking Companies
(Acquisition and Transfer of Undertakings) Act, 1980 on 01.01.2014
after Sh.V Kannan laid down offce on 31.12.2013 on elevation as
Chairman & Managing Director of Vijaya Bank. Sh.S Ganesh, joined the
Board of the Bank on 31.05.2013 as RBI Nominee Director under Section 9
(3) (c) of the Banking (Acquisition and Transfer of Undertakings) Act,
1980. Sh.Kingshuk Bhattacharya, joined the Board of the Bank on
14.06.2013 as Workmen Employee Director under Section 9 (3) (e) of the
Banking (Acquisition and Transfer of Undertakings) Act, 1980. Sh.M S
Sahoo, joined the Board of the Bank on 12.12.2013 as Part-time
Non-Offcial Director, appointed by Government of India under Section 9
(3) (h) of the Banking (Acquisition and Transfer of Undertakings) Act,
1980 and Sh. Narendra J Kotiawala, joined the Board of the Bank on
30.01.2014 as Officer Employee Director under Section 9 (3) (f) of the
Banking (Acquisition and Transfer of Undertakings) Act, 1980. Sh. Rajat
Sachar, joined the Board of the Bank as Government of India Nominee
Director under Sec 9 (3) (b) of the Banking Companies (Acquisition and
Transfer of Undertakings) Act, 1980 on 16.04.2014.
10. Explanation / COMMENTS BY THE BOARD OF DIRECTORS IN RESPONSE TO
AUDITORS'' REPORT
In respect of point no.6 - The Pension Trusts are permitted to invest
in Bank Bonds/deposits. The plan assets of the pension and gratuity
fund include investments made in Bank''s own Bonds (minimum ''A''
rated)/Deposits as per prevailing practice followed by the banking
industry. The observation has no impact on the financial statements.
After April, 2012 the Trusts have not invested funds in Bank''s own
Bonds/deposits and funds are now being placed in other banks.
In respect of point no. 8 (i) - The Reserve Bank of India has granted
exemption to the public sector banks from application of the provisions
of Accounting Standards (AS) 15, "Employee Benefits" vide its circular
no. DBOD. BP. BC / 80 / 21.04.018/2010-11 dated 09.02.2011 on
Re-opening of Pension Option to Employees of Public Sector Banks and
Enhancement in Gratuity Limits  Prudential Regulatory Treatment.
Accordingly, the Bank decided to amortise 2nd Pension option liability
during the specified period.
In respect of point no. 8 (ii) Â Various additional checks and balances
have been put into place such as (a) fishing of an alert / SMS to the
Regional Head & Second Man on any remittance / receipt above a
threshold limit in any branch for immediate monitoring and avoidance of
suspicious transactions (b) threshold limit defend in the newly opened
account for a period of 6 months and any transaction beyond the
threshold limit to be allowed only by Regional Head (c) specific
branches per region authorized for handling of bulk deposits instead of
acceptance of bulk deposits by all branches.
11. DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors confirm that, in preparation of the Annual Accounts for
the year ended 31st March, 2014
(a) the applicable accounting standards have been followed along with
proper explanation relating to material departures, if any,
(b) the accounting policies framed in accordance with the guidelines of
the Reserve Bank of India, were consistently applied,
(c) reasonable and prudent judgment and estimates were made so as to
give true and fair view of the state of affairs of the Bank at the end
of financial year and of the profits of the Bank for the year ended on
31st March, 2014.
(d) proper and sufficient care was taken for the maintenance of adequate
accounting records in accordance with the provisions of applicable laws
governing banks in India and the accounts have been prepared on a going
concern basis.
(e) Internal financial controls were laid down and these were adequate
and operating effectively.
(f) Proper systems were in place to ensure compliance of all laws
applicable to the Bank.
12. ACKNOWLEDGEMENTS
The Board of Directors thank Government of India, Ministry of Finance,
Department of Economic Affairs and Reserve Bank of India and other
Government & Regulatory Agencies for their valuable guidance and
continued support provided to the Bank throughout the year. The Board
of Directors are also grateful to the valued customers, esteemed
shareholders, stakeholders and public at large for their patronage and
confidence reposed in the Bank.
The Board of Directors place on record their great appreciation of the
commitment, sense of involvement and dedication exhibited by each staff
member in the overall development, growth and prosperity of the Bank
and look forward to their continued support and whole-hearted
co-operation for realization of the corporate goals in the year ahead.
For and on behalf of the Board
Gurgaon (S L BANSAL)
12th May 2014 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2013
1. BUSINESS OPERATIONS
The Business of the Bank stood at Rs.306083.69 crores as on 31st March,
2013 as against Rs.269014.73 crores in the previous year. Total
deposits of the Bank stood at Rs.175897.52 crores and have shown an
increase of Rs.19932.60 crore depicting a growth of 12.78%. Cost of
deposit stood at 7.90% as against 7.69% for financial year 2011-12.
With the decreasing interest rate regime during the starting of the
financial year 2012-13, though the bank has cautiously introduced
special schemes to procure deposits, yet it has adversely impacted the
cost of deposit which for the year ended 31.03.2013 increased to 7.90%
from 7.69% for the year ended 31.03.2012.However, the Bank has
considerably reduced high cost bulk deposits during the year. As a
result of the above, the ratio of bulk deposits has decreased from
27.56% as on 31.03.2012 to 20.26% as on 31.03.2013. On the other hand,
net advances as at end- March 2013 stood at Rs.128955.06 crore,
registering a growth of 15.16%. During the fiscal 2012-13, yield on
advances has increased to 12.27% from previous year''s level of 12.16%.
The measures taken up by the bank to improve yield on advances through
lending to sMe, Mid Corporate and Retail sector has enabled the bank to
improve the yield on advances.
The credit deposit ratio of the Bank, as at end-March 2013, stood at
74.10%. The Bank ensured adequate flow of credit to the productive
sectors of the economy. The Loans & Advances portfolio of the bank is
well diversified and balanced.
2. CAPITAL & RESERVES
During the year, the bank transferred a sum of Rs.1014.23 crore to
Reserves (comprising Rs.332.00 crore transferred to Statutory Reserves,
Rs.223.00 crore to Special Reseve under IT Act, Rs.5.22 crore to
Investment Reserve Account, Rs.442.00 crore to Revenue and Other
Reserves and Rs.12.01 crore to Capital Reserve) out of the profit for
the year 2012- 13. With this, capital & reserves as on March 31, 2013
have gone upto Rs.12775.54 crore as against Rs.11942.50 crore as at end
March 2012 and the ratio of Capital & Reserves to average working funds
stood at 6.87% as on 31.03.2013 as against 7.00% as on 31st March 2012.
3. CAPITAL ADEQUACY RATIO
The Bank''s Capital Risk Weighted Assets Ratio (CRAR) as on 31.03.2013
under Basel II guidelines (applicable up to 31.03.2013) stood at 12.04%
as against 12.69% as on 31.03.2012. This is above the regulatory
minimum requirement of 9%.
4. FINANCIAL PERFORMANCE
The Bank has posted a total income of Rs.19359.49 crore during the year
as against Rs. 17055.13 crore last year thus registering an increase of
Rs.2304.36 crore showing a growth of 13.51% during the fiscal 2012-13.
Operating Profit of the Bank has increased to Rs.3690.69 crore as
against Rs.3140.58 crore last year showing a growth of 17.52% The Bank
has earned a net profit of Rs.1327.95 crore, after making all requisite
provisions showing an increase of Rs.186.39 crore, a growth of 16.33%
during the fiscal 2012-13.
Financial performance including appropriation from the Net Profit is
given below:-
Table 1: Financial Performance (Rupees in crore)
31.03.2013 31.03.2012
Interest Income 17704.78 15814.88
Other Income 1654.71 1240.25
Total Income 19359.49 17055.13
Interest Paid 13003.62 11599.09
Operating Expenses 2665.18 2315.46
Total Expenses 15668.80 13914.55
Operating Profit 3690.69 3140.58
Provisions & Contingencies 2362.74 1999.02
Net Profit 1327.95 1141.56
Add-Profit brought forward 0.49 0.79
Net Profit available for appropriation 1328.44 1142.35
APPROPRIATION
Transfer to Statutory reserve 332.00 286.00
Transfer to Revenue and Other reserves 442.00 16.00
Transfer to Special Reserve u/s 36 (1)(viii) 223.00 565.00
of I-T Act
Transfer to capital reserve 12.01 6.98
Investment Reserve Account 5.22 -
Proposed Dividend 268.42 230.49
Tax on Dividend 45.62 37.39
Balance carried over to Balance Sheet 0.17 0.49
5. DIVIDEND
Your Bank''s policy of declaring dividend is to reward the share holders
as well as to plough back profit for maintaining a healthy capital
adequacy ratio & for supporting future growth. Accordingly, your
Directors are pleased to propose a total dividend of 92.00 % (i.e
Rs.9.20 per share) for the year ended 31st March, 2013 as against 79.00
%(i.e. Rs.7.90 per share) paid for the preceding year.
6. SECTORAL DEPLOYMENT OF CREDIT TO PRIORITY SECTOR
Bank''s advances to priority sector increased by Rs 6254 crore from Rs.
40527 crore in March 2012 to Rs. 46780 crore in March 2013, registering
a growth of 15.43%. The Priority Sector Advances constituted 41.78% of
the Adjusted Net Bank Credit (ANBC) against the stipulation of 40%. The
comparative position of advances under various segments under Priority
Sector at the end of March 2012 and March 2013 are as follows:
(Amount Rs. in crore)
S.
No. Sector March 2012 March 2013
1. Priority sector credit 40527 46780
2. Agriculture 15411 17881
3. Direct Agriculture 11860 13866
4. Indirect Agriculture 3551 4015
5. SSI / SE 17978 20945
6. Educational Loan 1124 1172
7. Housing Loan 5982 6753
6.1 Agriculture Advances
Bank''s advances to agriculture increased by Rs. 2470 crore from 15411
crore in March 2012 to Rs.17881 crore in March 2013, registering a
growth of 16.03%. The advances to direct agriculture segment increased
by Rs.2006 crore from Rs.11860 crore as on 31.3.2012 to Rs.13866 crore
as on 31.3.2013 constituting a growth of 16.91%. The Indirect
agriculture advances increased by Rs.464 crore from Rs.3551 crore as on
31.3.2012 to Rs.4015 crore as on 31.3.2013 showing an increase of
13.07%.
6.1.1. Flow of credit to Agriculture sector (Disbursement)
During the financial year 2012-13, flow of credit to agriculture sector
amounted to Rs. 10986.00 crore.
6.1.2. Small and Medium Enterprises (SMEs)
Bank''s exposure to Small Enterprises stood at Rs 20945 crore at the end
of March, 2013 and has shown an increase of Rs. 2967 crore, recording
a growth of 16.50% against the Year- on-Year growth stipulation of 20%.
Further, SME advances increased by Rs.5,886 crore to Rs.26,013 crore
registering a growth of 29.25%. The Micro Enterprises sector advances
increased by Rs.1700 crore to Rs.7746 crore posting a growth of 28.11%.
Bank has covered 2338 fresh accounts amounting to Rs. 296.53 Crore
during the FY 2012-13 under CGTMSE.
6.1.3. Oriental Green Card (OGC) & Oriental Kisan Gold Card (OKGC)
During the Financial Year 2012-13, Bank has issued 1,25,011 cards to
farmers to meet their credit requirement for crop production, repairing
of agricultural machinery & equipment, working capital for allied
activities, to repay their old debts taken from non institutional money
lenders and consumption needs. The total amount of loan disbursed
through these cards during the year was Rs.3442.57 crore. Bank has
issued 45,123 ATM debit cards to OGC holders up to March 2013 and
2,02,384 ATM cards have been issued in KCC as on 17.05.2013.
6.1.4. Advances to Weaker Sections
Advances to weaker sections, consisting of beneficiaries belonging to
scheduled castes/scheduled tribes, small and marginal farmers, landless
labourers, rural artisans, beneficiaries under Central Govt. Sponsored
Schemes (except PMEGP) was Rs. 11549 crore as on 31.03.2013 against Rs.
8703 crore as on 31.03.2012. Bank has achieved the target of 10% of
ANBC to Weaker Sections.
6.1.5. Micro finance to Self Help Groups (SHG)/ Joint liability Group
(JLG).
Bank has 11127 saving linked SHGs/JLGs accounts under SHG-Bank Linkage
Programme. The Bank has directly financed 5876 SHGs / JLGs accounts
amounting Rs. 29 crore as on 31.03.2013. Bank has also financed
SHGs/JLGs through 13 MFIs amounting Rs. 222.39 crore as on 31.03.2013.
6.1.6. Credit under Differential Rate of Interest Scheme
Credit at concessional rate of interest of 4% p.a. to the low- income
group of the society both in rural having annual family income upto Rs.
18,000/- and urban having annual family income upto Rs. 24,000/-
centres was Rs. 46 crore as at the end of March 2013.
6.1.7. Loans to SCs/STs
Bank continues its thrust in providing financial assistance to SCs/STs
beneficiaries. The advances to these beneficiaries increased to Rs 1478
crore in March 2013 against Rs. 732 crore as at the end of March 2012.
6.1.8. Prime Minister Employment Generation Programme (PMEGP)
The Scheme has been implemented by the Government of India by merging
the two schemes viz. pMrY and REGP w.e.f. 1st April 2008. The scheme
aims at generation of employment opportunities through establishment of
micro enterprises in rural as well as urban areas. The bank has
sanctioned credit assistance of Rs 39.46 crores to 864 applicants under
the scheme during 2012-13.
6.1.9. Swaran Jyanti Shahri Rojgar Yojana (SJSRY)
For providing gainful employment to urban poor (living below the urban
poverty line) through setting up self employment ventures, bank is
providing financial assistance under the scheme. The bank sanctioned to
1924 beneficiaries to the tune of Rs.13.63 crores during 2012-13.
6.1.10. Swarn Jyanti Gram Swarojgar Yojana (SGSY)
The scheme is operative in rural areas of the country and cover the
aspects of self employment such as organization of rural poor into Self
Help Group (SHGs) training credit technology, infrastructure and
marketing. The bank is participating in the schemes. During 2012-13
bank sanctioned financial assistance to 2801 swarojgaris to the tune of
21.61 crore.
6.1.11. Credit Flow to Women Beneficiaries
Bank''s advance to women increased by Rs.1794.00 crore from Rs. 4621.00
crore as on March 2012 to Rs. 6415.00 crore as on March 2013,
registering a growth of 38.82%. Bank''s advances to women beneficiaries
as on March 2013 was 5.73% of ANBC against the required stipulation of
5%.
6.1.12. Lending to Minority community
Bank has achieved 15.81% of Priority Sector Lending towards minority
communities to during FY 2012-13 in comparison to 14.98% during FY
2011-12 against stipulated norm of 15%.
6.1.13. Financial Inclusion
With a view to provide banking facilities in un banked villages, Bank
has rolled out Financial Inclusion Plan in 569 allotted villages with
population more than 2,000 and in 336 villages with population between
1600 - 2000. Bank has covered all the 905 villages under Financial
Inclusion Plan as on 31.03.2013. Out of 905 villages, 779 are covered
through Business Correspondent model, 63 through brick & mortar Branch
Model and remaining 63 through Mobile Branch Model.
Bank has opened a total number of 6,52,207 No-Frill/ Other savings
accounts in these 905 villages. Further 2,92,592 customers, whose
accounts were opened through BC Agents, have been issued activated
Bio-metric cards for extending IT enabled banking services.
A special drive has been launched at Delhi w.e.f. 16.07.2012 to extend
banking facilities to the migrant labourers and street vendors/ hawkers
in urban areas by opening their Small SB accounts. A Call center
service with toll free telephone number, SMS & e-mail facility have
been put in place to reply the queries of the persons/ guiding the
persons intending to open accounts with the banks. A total number of
34,335 accounts of the migrant labourers and street vendors/ hawkers
have been opened by our bank in Delhi since 16.07.2012 out of 2,60,370
accounts opened by all SLBC member banks. Our bank opened 13.18% of
total accounts. This initiative of our bank got due coverage under the
heading "Bank Accounts for Migrant Labour" in Issue -I, Sept''2012
edition of Banking, Insurance, Pension - A Journal of the Department of
Financial Services, Ministry of Finance, Govt. of India. All PSBs have
been advised by the Department of Financial Services, Ministry of
Finance, Govt. of India to initiate similar drives in the State(s)/ UTs
where their bank is SLBC convener.
6.1.14 Implementation of DBT Scheme.
Bank received list of 14,341 beneficiaries in 26 district out of 43
pilot Districts (Phase- I) and accounts of all the beneficiaries have
been opened. Bank received the list of 4,790 beneficiaries in 10
districts out of 78 additional districts (phase-II) and accounts of all
the beneficiaries have been opened. Bank has received the lists of
54,895 beneficiaries in total 61 districts throughout the country and
accounts of all beneficiaries have been opened. Bank has issued ATM
debit cards to 23735 beneficiaries. Bank has seeded Aadhaar number in
16293 accounts.
Bank has three Lead districts, which are not among 43 (Phase-I) and 78
(Phase-II) districts. However, We have taken initiative to implement
DBT in our Lead districts. The details of list of beneficiaries
obtained and accounts opened are as follows:
Total No. of
No. of No. of
S. Name of the Beneficiar-
Schemes Accounts
No District Implemented ies list opened
received
1 Sriganganagar 13 53115 42479
2 Palwal 4 17068 17068
3 Ferozepur 7 38475 35574
Total 108658 95121
There is no gap in opening of accounts for our branches.
6.1.15 State Level Bankers Committee Responsibility
Bank was bestowed with prestigious assignment of Convener- State Level
Bankers'' Committee for Delhi State by the Government of India from
November, 2011. Bank has taken over reins from State Bank of India.
There are 33 member banks of SLBC - Delhi State which include all banks
i.e. PSBs, Private Sector Banks and Coop Banks. Delhi State is served
by 2650 branches of these member banks. The SLBC achieved 101.86% of
Annual Credit Plan, 2012-13.
SLBC, Delhi has played important role in launching of Delhi Annashree
Yojana of Govt. of NCT of Delhi and campaign for opening of accounts of
school children.
It has also closely co-ordinated with DFS, MoF, GoI/ RBI/ State Govt.
departments/ Member Banks for implementation of Government and RBI
directions.
6.1.16. Lead Bank Responsibility
Bank is performing the functions of Lead Bank in three Districts,
namely, Ferozepur in Punjab, Sriganganagar in Rajasthan and Palwal in
Haryana. There is more than 100% achievement under ACP in all three
districts respectively.
6.1.17. OBC Rural Development Trust
Bank has set up a special purpose vehicle in the name of Oriental Bank
Rural Development Trust (OBCRDT) for setting up Training Centres at
various places across the country for imparting training for capacity
building in rural areas. The Trust came into being on 9th December 2005
as a registered body.
The main objective of the Trust is to establish training colleges/
institutes and workshops for providing training for farmers on modern
techniques of farming, tractor/farm machinery repair & maintenance and
other aspects of agriculture/rural development; micro finance and
capacity building of the rural youth and women.
Presently five OBCRSETIs (OBC Rural Self Employment Training
Institutes) are functional at Dehradun, Sriganganagar, Jaipur,
Ferozepur and Palwal.
We have been allotted land by the State Governments in Chomu (Jaipur-
Rajasthan), Zira (Ferozepur-Punjab), Jassowala (Dehradun-Uttrakhand),
Manaksar (Sriganganagar- Rajasthan) and Rattipura (Palwal- Haryana).
The RSETIs at Chomu (Jaipur) and Zira (Ferozpur) are operating and
holding training programmes from their own premises. The process of
construction of buildings for the remaining 3 RSETIs is under progress.
During the Financial Year 2012-13, a total of 339 training programmes
were conducted and 10749 candidates were given training. Of these 125
were Skill Development Programmes on subjects like tailoring & dress
designing, watershed management, phulkari embroidery, milch animal
rearing, crop production, beauty parlour, medicinal plantation, mobile
repairing, etc which benefitted 3648 candidates. A total of 2146
persons trained under Skill Development Programmes were settled during
FY 2012-13. The settlement rate of trainees improved to 57% during the
FY 2012-13 as compared to 39% during FY 2011-12. Emphasis is also given
to train candidates from BPL strata of the society for which list of
candidates are obtained by the centres from respective DRDA.
Cumulatively these centres have conducted 1092 training programmes
since inception benefiting 36597 candidates.
6.1.18 CSR Initiatives taken during FY 2012-13.
As an entity responsible to the society, the bank under takes Corporate
Social Responsibilities for benefit of the larger section of the
society. During 2012-13, bank has under taken the following CSR
activities.
a. The Bank has adopted 461 Primary School by installing 1442
electricity fans, constructing 87 toilets and providing clean drinking
water facility to 299 schools. Further, 21 solar panels also for
uninterrupted power back-up. Total expenses incurred were Rs. 67.04
lakh in Govt. Primary schools.
b. Bank has incurred expenses of Rs. 179.01 lakhs in 766 financial
inclusion villages and other rural areas by providing Water purifier,
water coolers, school bags, Hand pumps, Stitching Machines, and Chairs
besides organizing Eye Operation camps.
c. The Bank has initiated campaign ''Smoke Free Jodhpur'' in
coordination with local authorities under COPTA for display of banners
in school premises.
d. Sponsored "Hunger Free Delhi" Campaign- ''Aap ki Rasoi'' under
Bhagidari Programme of Govt. of NCT. Of Delhi to provide food to poor.
e. Van donated to ''Arunodaya Deseret Eye Hospital, Gurgaon'' for
transportation of patients from slums dwelling areas to Hospital.
f. Ambulance donated to ''Maharaja Agrasen Charitable Hospital'' for
medical benefits to poor and needy patients.
g. Donation of Bus named ''School on wheels'' to NGO ''Help Us To Help
Them'' at Kolkata for educating street children.
h. Solar Panels were installed in Bulandsahar district of Uttar
Pradesh for uninterrupted power supply in schools and other works of
the village
7. RETAIL CREDIT
Retail Credit segment continues to be the thrust area of lending. Our
16 Retail Credit products are customer friendly, competitive and
specifically designed to suit all sections of the society.
In current FY, bank has achieved YOY growth of 25% in Retail Credit &
recorded 11.16% of total advances.
During the year, the bank has introduced loyalty concession for Home /
Car loan borrowers as well as revamped loan against immovable property
& personal loan schemes to make it more attractive to meet the various
needs of Retail Customers.
7.1 Home Loan
The Home Loan depicts YOY growth of 19.79% (previous year-18.79%).
During the year fresh home loan of Rs. 2096 Crore were sanctioned in
16204 accounts.
7.2 Car / Vehicle Loan
Despite recessionary trend in Car / Auto industry, our car loan segment
depicts YOY growth of 22.64%. During the year fresh car loan of Rs. 837
Crore were sanctioned in 17419 accounts.
7.3 Education Loan
The Education Loan portfolio of the Bank stood at Rs. 1227.04 Crore as
on 31.03.2013 and showed Y.O.Y Growth of 3.02%. The growth is
adversely affected due to credit of interest subsidy Rs. 30.00 Crore
(approx.)
Bank continued its efforts for extending education loans for higher
studies & vocational courses on soft terms based upon IBA guidelines.
Specific provision for management quota & nursing education has been
elaborated in the scheme.
A specific customized collateral free scheme for students of premier
institutions viz- IIMs, IITs, XLRIs & ISBs has been introduced on Base
Rate of interest.
8. TREASURY OPERATIONS
The G-Sec yields softened during FY 2012-13. This was due to reduction
in inflation levels, stunted economic growth and fiscal deficit
remaining within targeted levels. RBI reduced Repo and Reverse Repo
rates by 100 basis points during FY 2012-13 to revive growth. Equity
market remained volatile during 2012-13 and ended the year with a muted
return of 8%. The secondary market turnover has been Rs. 85,332.20
crore in FY 2012-13.
The net profit in the secondary market operations has been Rs.168.48
crore during FY 2012-13. The Bank has transferred Securities amounting
to Rs. 4970.51 crore from ''Available for Sale'' category to ''Held to
Maturity'' category. Further, Securities amounting to 18.30 crores were
transferred from ''Held to Maturity'' category to'' Available for Sale''
category. In the process, Bank booked depreciation of Rs. 185.74 crore.
The aggregate investment of the Bank has increased to Rs. 58,719.20
crore as on 31-03-2013 from Rs. 52,460.22 crore as on 31-03-2012 an
increase of 11.93%. The yield on investments have increased to 7.41%
from 7.36% last year (excluding income on RIDF deposits classified as
Non-SLR investments) owing to maturity of low yielding securities
vis-a- vis fresh investments in high yielding securities in Investment
portfolio.
9. FOREIGN EXCHANGE BUSINESS:
During the fiscal year 2012-13, Bank achieved Forex turnover of Rs
96,444 Crore as on 31.03.2013. The total earning from foreign exchange
Business for the financial year 2012-13 was Rs 237.79 Crore. The Export
credit of the Bank stood at Rs 5,750 Crore as on 31.03.2013 as against
Rs 4,976 Crore as on 31.03.2012, thus registering a growth of 15.55%.
Bank has 86 Specialized Branches to conduct foreign exchange business.
The Bank has mobilized Non Resident deposits to the tune of Rs 3068
Crores as on 31.03.2013 as against Rs 2323 Crores for the year ended
31.03.2012, thereby registering a growth of 32% over the preceding
financial year. The operations at Representative Office, Dubai has
completed four years of operations, acting as a catalyst to canvass
non- resident accounts of Indian Expatriates in UAE to expand the Non-
resident customer base of the bank.
10. Merchant Banking Activities
The Bank is a registered Category I Merchant Banker and holds
registration certificate valid upto 28.02.2014. The Bank also holds
permanent registration as Banker to an Issue. As Bankers to Issue, the
Bank has acted as Paying Banker for payment of dividend warrants and as
Self Certified Syndicate Bank (SCSB) for providing ASBA facility.
Applications Supported by Blocked Amount (ASBA)
Our Bank has been registered with SEBI as Self Certified Syndicate Bank
(SCSB) for providing Applications Supported by Blocked Amount (ASBA)
facility to its customers. ASBA is an application containing an
authorisation to block the application money in the bank account
maintained with SCSB.
Under the ASBA facility, the application amount for subscribing to an
issue (IPO/Rights issue), remains in the bank account of the customer
till allotment is finalized and actual amount equal to allotted shares
is only debited instead of total application amount. SEBI also allowed
syndicate / sub-syndicate members to procure ASBA forms from the
investors, upload the details in the bidding platform and forward the
same to Self Certified Syndicate Banks (SCSBs) which is referred to as
"Syndicate ASBA".
In compliance with SEBI guidelines, Bank is providing ASBA / Syndicate
ASBA facility through all its 2000 branches across the country.
11. THIRD PARTY PRODUCTS:
11.1 Life Insurance Business (JV):
During FY 2012-13, the Bank has sold 34205 policies with First Premium
Collection of Rs. 123.22 Crores and has earned commission of Rs. 12.66
Crores (Net).
11.2 General Insurance Business:
In General Insurance Business, the Bank has again registered a steady
growth and has collected a premium of Rs. 49.66 Crores earning a
commission of Rs. 5.69 Crores.
11.3 Oriental Bank Mediclaim Policy
Our Bank has signed an MoU with Oriental Insurance Company on 3rd
October 2011 and launched Oriental Mediclaim Policy. The product has
been designed exclusively for OBC Customers and available in all the
branches across the country. During the FY 2012-13, the Bank has
marketed 20865 policies and collected a premium of Rs. 7.74 croes
thereby earned a commission of Rs. 1.20 crore.
11.4 Mutual Fund Business:
Our Bank is selling the Mutual Fund products of the 7 Asset Management
Companies. During the Financial year 2012-13, the Bank has earned a
commission of Rs. 41.93 lakhs from Mutual Fund Business.
11.5 Demat Accounts:
The Bank is a Depository Participant for both NSDL and CDSL. As on
31.03.2013, our Bank has 71186 Demat accounts and 1193 Online Trading
accounts. The commission earned in FY 2012-13 from Demat business is
Rs. 2.69 crores. The Bank has tied up with the M/s. IDBI Capital Market
Services Ltd. & M/s. Karvy Stock Broking Limited for providing Online
Trading facilities to its Demat Account holders through 298 identified
Branches.
11.6 Gold Coins:
The retail sale of Gold Coins in different denominations (5 grams, 8
grams & 10 grams) was launched on 30.10.2010 in our Bank. During the FY
2012-13, our bank has sold 19572 Gold Coins through 270 designated
branches across all regions and earned a profit of Rs. 2.04 Crores.
11.7 UID Cards:
Bank is appointed as Registrar by Unique Identification Authority of
India and carried out more than 14.60 Lac enrolments in Phase II of the
Project in FY 2012-13. We have received a gross commission of Rs. 3.08
crore in FY 2012- 13 from UIDAI. UID enrolment process is being carried
out in Eight States/U.Ts which includes Delhi, Punjab, Haryana, Madhya
Pradesh, Rajasthan, Maharashtra and Kerala.
11.8 Cash Management Services (CMS):
The Bank provides an efficient and tailor-made CMS solution to suit the
customer requirements. The Bank is offering Collections, Payments and
Custodial Services to the Customers under Cash Management Services. The
Bank has 136 CMS collection centres across India. The Bank has
registered a turnover of above Rs. 749.89 Crores and earned a
commission of Rs.1.21 Crores during the financial year of 2012-13.
11.9 Oriental Bank of Commerce-SBI Credit Cards
Our Bank signed an MOU with SBI Cards on 14.09.2011 and launched
Co-branded Credit Cards on 22.10.2011. There are two types of Credit
Cards being issued: (i) SBI-Oriental Bank of Commerce Gold & More (ii)
SBI-Oriental Bank of Commerce Platinum. These cards are being issued in
two variants i.e. Secured and Unsecured. There are 19 Regional Offices
and 456 branches have been authorized to source unsecured credit cards.
Secured Cards can be sourced by all the branches. As on 31.03.2013,
22666 cards had been sourced by the branches, out of which 14198 cards
were issued.
12. BRANCH EXPANSION
During 2012-13, the Bank has opened 209 new branches besides up
gradation of 19 Extension Counters. As on 31.03.2013, the total number
of branches stood at 2000 as against 1772 as on 31.03.2012.
The population group-wise classification of branches is as under :
S.N. Classification 31.03.2013 31.03.2012
1. Rural 468 369
2. Semi-urban 561 482
3. Urban 541 524
4. Metropolitan 430 397
Total 2000 1772
13. CUSTOMER SERVICE
The Bank in its endeavor to achieve excellence in customer service has
started many customer friendly services viz. Mobile Banking (OBCMPAY)
besides Internet Banking Services both for individuals and corporates,
SMS alert service, Cheque/ Cash deposit facility through some of the
Bank''s ATMs. Funds transfer through ATMs (only among accounts linked to
a ATM card), facility of Cheque Status Inquiry and Stop cheque payment
available 24x7 on Bank''s ATMs, deployment of Point of Sale (POS)
Terminals at the identified prospective Merchant Establishments, Cheque
deposit machines at some of the branches to facilitate cheque deposit
with acknowledgment generated by the machine itself, online payment of
service taxes etc. These services are helpful for the customers to get
their transactions done speedily and easily. For Senior Citizens
customers there is provision for separate queue in the branches. Format
of passbooks (Savings Deposit, Progressive Deposit, OGC) have been
reviewed in order to make it more informative.
The Bank has adopted and implemented voluntary codes of BCSBI for
individual customers, Fair Practice code for lenders, Micro and Small
Enterprise (MSEs) code to provide fair, transparent and quality service
to all the customers and to provide greatest satisfaction to the
customers. The codes are displayed on the Bank''s website for
information and printed copies are also available at branches for
customers'' information.
The updated information on Bank''s Deposit Schemes, Loan Schemes,
Citizen''s Charter, Banking Ombudsman, SSI Charter, Forex Remittances,
Service Charges and Bank''s Policies viz Financial Inclusion Policy,
Cheque Collection and Compensation Policy, Grievance Redressal Policy,
Policy on Collection of dues & Repossession of Security etc. have been
displayed in Public domain of Bank''s website. These are also available
at branches in booklet/pamphlet form. "Query & Suggestion" link is
provided on website to get feedback from customers.
Complaint/Suggestion Boxes are provided at branches where a customer
can drop his/her complaint or suggestion.
The Customer Service Meetings are being held regularly at Branch level,
Regional Office level and Head Office level. These meetings ensure the
proper implementation of guidelines issued by regulatory authorities.
The customers are invited to attend these meetings and give their
valuable suggestion/feedback on bank''s services and schemes. The Bank
is committed to give excellent customer service for the customers''
maximum satisfaction.
Web-based Customer Grievance Redressal system is provided for prompt
redressal of customers grievances. A dedicated Customer Care Centre on
toll free Number 1800- 180-1235 has been set up for clarifying the
customers account related and other queries. Separate SLBC Helpline
Number 1800-180-0124 has also been started.
14. KNOW YOUR CUSTOMER (KYC) NORMS & ANTIMONEY LAUNDERING (AML)
MEASURES
To comply with the various laws and regulations, national as well as
international, Govt. of India and Reserve Bank of India directives /
instructions & guidelines, primarily to prevent the bank from being
used, intentionally or unintentionally, by criminal elements for money
laundering activities, OBC ''KYC'' Policy has been formulated. The
Policy combines four key elements viz. "Customer Acceptance
Policy", "Customer Identification Procedures", "Monitoring of
Transactions" and "Risk Management". This enables the bank to
know / understand the customers and their financial dealings better and
helps in managing risks prudently. The detailed guidelines and
subsequent instructions are being reiterated from time to time for
strict compliance by the field functionaries. The bank is already
complying with the requirement of submission of statutory reports to
the FIU-IND as a sequel to the legislation on Prevention of Money
Laundering Act, 2002 and its Amendment Act, 2012. The Bank has already
operationalised Anti-Money Laundering software solution for complying
with KYC Norms / AML Measures and generation of alerts to detect any
suspicious transaction. Alerts are being scrutinized and STRs are being
submitted to FIU-IND. Bank is also submitting all the required
data/returns relating to KYC/AML to the regulatory bodies.
15. USE OF HINDI IN THE BANK
During the year 2012-13, Bank continued its concerted efforts to
accelerate use of Hindi and implement the guidelines/ directives
received from Govt. of India and Reserve Bank of India. Concrete and
effective steps were taken to achieve the region wise targets set in
the Annual Programme- 2012-13 by the Department of Official Language,
Ministry of Home Affairs, Govt. of India Bank was awarded Indira Gandhi
Rajbhasha Protsahan Puraskar for the year 2010-11 by Hon''ble President
Of India Sh. Pranab Mukharjee and Consolation prize in ''B'' region under
Reserve Bank Rajbhasha Shield Competition 2010-11 for its excellent
performance in the field of Rajbhasha Hindi. Regional Office, New Delhi
was selected for Second Prize by Northern Regional Implementation
Office, Rajbhasha Vibhag, Min. of Home Affairs. Regional Offices
Gurgaon,Delhi/ New Delhi & B/O Mangalore were awarded by respective
Town Official Language Implementation Committees (2011-12) for doing
excellent work in Hindi. Bank''s In-House Magazine AADHAAR was awarded
Second Prize by the Delhi Bank''s Town Official Language Implementation
Committee.
Hon''ble Parliamentary Committee on Official Language visited our
Uttarkashi Branch on 02.06.2012 & Drafting & Evidence Sub-Committee Of
Parliamentary Committee on Official Language held discussions on
progress made in the use of Hindi with Regional Head, RO Bangalore and
appreciated the works being done in Hindi in the Bank.
Progress made in use of Hindi in IT
i. Weekly SMS Alerts in Hindi were sent to Bank''s account holders.
ii. Hindi Templates of routine letters, on line English- Hindi Banking
Glossary, Official Language Act & Rules, directions for unicode
settings, bilingual software & Hindi Fonts for download and
e-circulars, schemes, policies,forms, Finacle Job Cards etc. were
provided in Hindi at Bank''s Web Portal to facilitate working in Hindi.
iii. Bank''s Website is available in Hindi Unicode besides English.
iv. Officers/ Employees were imparted training to work on computer in
Hindi and send e-mail in Hindi with the help of Unicode.
v. To provide banking facilities to customers in Hindi also by CBS
branches, bilingual Software Script Magic has been provided in the
branches of the Bank .
vi. Bank implemented on-line submission & consolidation of Quarterly &
Annual Hindi Progress Report through Chris Mac-MIS.
Bank hosted 87th meeting of Coordination Committee on Training, RBI at
Chandigarh on 07.12.2012 in which higher officials from public sectors
Banks & financial institutions participated. A Hindi Handout on"
Sarkari Karobar" was also released in the meeting. A three day
conference of Hindi Officers of the Bank was organized at STC, Noida.
Noting Sahayika in Hindi was prepared & provided to employees to
increase use of Hindi.
Hindi-Day/Hindi-Fortnight was celebrated in all offices / branches of
the bank in the month of September, 2012 and various competitions were
conducted. The winners of Hindi competitions were awarded by our worthy
CMD in a function organized at Corporate Office. Bank conducted an
Inter Bank Hindi Chitra Kahani Lekhan Competition under auspices of
Delhi Banks Town Official Language Implementation Committee. Our staff
members won prizes in various Inter Bank competitions.
Bank''s Quarterly IT magazine ''IT Chintan'' is being published in Hindi
also. All the issues of Bank''s quarterly In-House Magazine
"AADHAAR" were published regularly in bilingual form i.e. in Hindi
and English.
16. RECOVERY
The Bank has made concerted efforts for recovery of NPAs and as a
result of this the Bank could make Cash Recovery of Rs.1525.77 Crore
during the Financial Year 2012-13. Out of the said Cash Recovery, a sum
of Rs.771.83 Crore has been added as recovery towards the Revenue of
the Bank. Further, all the available recovery mechanism have been
utilized by the Bank, viz. holding of Recovery Camps, floating of
"Special One Time Settlement Schemes for NPAs with O/S upto Rs.
10.00 Lakh", participating in Lok Adalats, taking action under
SARFAESI Act-2002, initiating legal action in the competent Courts of
Law and settling of cases under general settlement policy of the Bank.
However, due to global recession, Indian economy has also been affected
and the NPAs of the Bank has increased in comparison to the previous
financial year from Rs. 3580.49 Crore as on 31.03.2012 to Rs. 4183.96
Crore as on 31.03.2013. Accordingly, the Gross NPA percentage to gross
advances has increased to 3.21% against 3.17% of corresponding F.Y. and
the Net NPA of the bank has increased to 2.27% against 2.21% of
corresponding F.Y.
The Bank is taking all possible efforts to strengthen the recovery
mechanism to minimize the delinquencies. A sub-committee of Board has
been constituted to monitor the position NPA, Slippages and Recovery.
17. HUMAN RESOURCE DEVELOPMENT & TRAINING
Human Resource Development Department during the year 2012-13 has taken
a significant turn with Government of India, Ministry of Finance,
Department of Financial Services bringing changes in Eligibility
criteria for Promotions with Rural/ Semi-Urban experience, Timelines
for Transfers, Annual Performance Appraisal System etc for uniform
implementation across Public Sector Banks. This necessitated PSBs to
gear up their machinery to meet the aspirations of the Govt. of India.
Our Bank has been one among the first groups to implement the above
Government guidelines and complete the process in time.
The emphasis of training for the year 2012-13 is more on developing
leadership in pipeline to meet the challenges ahead of large scale
retirements. The Bank has drawn up a full fledged document on
Succession Planning by preparing a talent pool and identifying High
Potential Individuals to man the key positions in the Bank. These High
Potential Individual are being groomed to take over the key positions
in future in the Bank. The Bank has also conducted number of programmes
on Leadership Development viz Leadership for Branch Managers, Role
Change for Officers, Management Development Programme for Senior
Executives.
The focus of training however continued to be on the following
functional areas:
Credit Management, Risk Management, Forex Management, Customer
Relationship Management, NPA & Recovery Management, Agriculture
Financing & Rural Development, Financial Inclusion, Refresher Programme
for POs, Programme for Hall Incharge, General Banking for Officers,
Soft Skills Development, CBS & IT Products, Programme on Reservation
Policy for SC/ST/OBC etc.
In 418 programmes 10738 employees were imparted training in the above
and other areas of Banking. In addition, 1395 officers were nominated
in Advanced Training Programmes in key operational and behavioral areas
in pioneer institutions like NIBM, Pune, College of Agricultural
Banking, Pune; IBA, Mumbai; IDRBT, Hyderabad; NIBSCOM, Noida, Centre
for Organizational Development, Hyderabad etc. Few Senior and Top
Management functionaries were deputed for overseas training for
Management Development Programmes/ Conferences/ Seminars to give them
exposure to International best practices and their impact in Indian
Banking.
During the year 2012-13, the Bank recruited 159 Probationary Officers,
167 Clerks, 216 Subordinate Staff and 172 Specialist Officers in
different grades and streams such as Manager (FA), Manager (Risk
Management), Officer (FA), Officer (Marketing) and Agriculture
Officers, etc. The Bank further during the ensuing year plan to recruit
around 1689 employees. The total staff strength as on 31st March, 2013
is 18891 comprising of 9905 Officers, 5601 Non-subordinate and 3385
Subordinates. The Bank also promoted 1482 employees in different
cadres during the year 2012-13.
The bank complied with Govt. guidelines in respect of reservation in
recruitment and promotion for SC/ST/OBC/ PWD/Ex-Servicemen in letter
and spirit. The Bank recruited 341 SC/ST/OBC category personnel in
Officer, Clerical & Subordinate cadres during the year. The grievances
of SC/ ST/OBC employees, if any, were resolved through SC/ST and OBC
Cells created at all Regional Offices and at Head Office with the
coordination of Liaison Officers/Chief Liaison Officer. During the year
2012-13, the National Commission for Scheduled Castes held series of
review meetings with the Bank in different geographical areas and
expressed their satisfaction over the implementation of Government
guidelines in respect of reservation for Scheduled Castes in the Bank.
The Ministry of Finance, Govt. of India, Department of Financial
Services during the period have also inspected the Reservation Rosters
maintained for SC/ST/OBC/pWd/Ex-SM in the Bank and expressed
satisfaction.
BOARD OF DIRECTORS
During 2012-2013, 15 meetings of Board of Directors, 12 meetings of
Management Committee of Board, 10 meetings of Audit Committee of Board,
were held.
Sh. S L Bansal was the Chairman and Managing Director for the Financial
Year 2012-13. Sh. Bhupinder Nayyar, joined the Board of the Bank as
Executive Director under Sec 9 (3) (a) of the Banking Companies
(Acquisition and Transfer of Undertakings) Act, 1980 on 05.10.2012
after Sh.S C Sinha laid down office on 31.07.2012. Sh.P.M.Chopda,
joined the Board of the Bank on 18.01.2013 as Part-time Non-Official
Director, appointed by Government of India under Section 9 (3) (h) of
the Banking (Acquisition and Transfer of Undertakings) Act, 1980. Sh.
B. Srinivas, RBI nominee Director has superannuated on 31.03.2013.
DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors confirm that, in the preparation of the Annual Accounts
for the year ended 31st March, 2013
a. the applicable standards have been followed along with proper
explanation relating to material departures, if any,
b. the accounting policies framed in accordance with the guidelines of
the Reserve Bank of India, were consistently applied,
c. reasonable and prudent judgment and estimates were made so as to
give true and fair view of the state of affairs of the Bank at the end
of financial year and of the profits of the Bank for the year ended on
31st March, 2013,
d. proper and sufficient care was taken for the maintenance of
adequate accounting records in accordance with the provisions of
applicable laws governing banks in India and the accounts have been
prepared on a going concern basis.
ACKNOWLEDGEMENTS
The Board of Directors thank Government of India, Ministry of Finance,
Department of Economic Affairs and Reserve Bank of India and other
Government & Regulatory Agencies for their valuable guidance and
continued support provided to the Bank throughout the year. The Board
of Directors are also grateful to the valued customers, esteemed
shareholders, stakeholders and public at large for their patronage and
confidence reposed in the Bank.
The Board of Directors place on record their great appreciation of the
commitment, sense of involvement and dedication exhibited by each staff
member in the overall development, growth and prosperity of the Bank
and look forward to their continued support and whole-hearted
co-operation for realization of the corporate goals in the year ahead.
For and on behalf of the Board
Gurgaon (S.L. BANSAL)
2nd May 2013 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2012
The Board of Directors have pleasure in presenting this Annual Report
together with the Audited balance Sheet and Profit & Loss Account of
the Bank for the year ended 31st March, 2012.
1. BUSINESS OPERATIONS
The Business of the Bank stood at Rs. 269014.73 crore on 31st March
2012 as against Rs. 235893.16 crores in the previous year. Total
deposits of the Bank stood at Rs. 155964.92 crore and have shown an
increase of Rs. 16910.66 crore depicting a growth of 12.16%. Cost of
deposit stood at 7.69% as against 6.03% for financial year 2010-11.
With the increasing interest rate regime, though the bank has
cautiously introduced special schemes to procure deposits during the
last year, still it has adversely impacted the cost of deposit which
for the year ended 31.03.2012 has increased to 7.69% from 6.03% for the
year ended 31.03.2011.However, the Bank has cautiously procured high
cost bulk deposits during the year. As a result of the above, the ratio
of bulk deposits has decreased from 34.26% as on 31.03.2011 to 27.56%
as on 31.03.2012. On the other hand, net advances as at end-March 2012
stood at Rs. 111977.69 crore, registering a growth of Rs. 16.76%.
During the fiscal 2011-12, yield on advances has increased to 12.16%
from previous year's level of 10.52%. The measures taken up by the bank
to improve yield on advances through lending to SME, Mid Corporate and
Retail sector has enabled the bank to improve the yield on advances.
The credit deposit ratio of the Bank, as at end-March 2012, stood at
72.68%. The Bank ensured adequate flow of credit to the productive
sectors of the economy. The Loans & Advances portfolio of the bank is
well diversified and balanced.
2. CAPITAL & RESERVES
During the year, the bank transferred a sum of Rs.873.98 crore to
Reserves (which includes Rs. 286.00 crore transferred to Statutory
Reserves, Rs. 565.00 crore to Revenue and Other Reserves and Rs.6.98
crore to Capital Reserve) out of the profit for the year 2011-12. With
this, capital & reserves as on March 31, 2012 have gone upto
Rs.11942.50 crore as against Rs. 11097.14 crore as at end March 2011
and the ratio of Capital & Reserves to average working funds stood at
7.00% as on 31.03.2012 as against 7.62% as on 31st March 2011.
3. CAPITAL ADEQUACY RATIO
As on March 31. 2012 the Capital Adequacy Ratio of the Bank under Basel
-II stood at 12.69% as against 14.23% as on 31st March, 2011. This is
well above the regulatory minimum requirement of 9.00%.
4. FINANCIAL PERFORMANCE
The Bank has posted a total income of Rs. 17055.13 crore during the
year as against Rs. 13047.89 crore last year thus registering an
increase of Rs. 4007.24 crore (a growth of 30.71% during the fiscal
2011-12. Operating Profit of the Bank has decreased to Rs. 3140.58
crore as against Rs 3245.14 crore last year showing a marginal decline
of 3.22% The Bank has earned a net profit of Rs. 1141.56 crore, after
making all requisite provisions showing a decrease of Rs. 361.31 crore
showing a decline of 24.04% during the fiscal 2011-12.
Financial performance including appropriation from the Net Profit is
given on next page:-
Table 1: Financial Performance (Rupees in crore)
31.03.2012 31.03.2011
Interest Income 15814.88 12087.82
Other Income 1240.25 960.07
Total Income 17055.13 13047.89
Interest Paid 11599.09 7910.27
Operating Expenses 2315.46 1892.48
Total Expenses 13914.55 9802.75
Operating Profit 3140.58 3245.14
Provisions & Contingencies 1999.02 1742.27
Net Profit 1141.56 1502.87
Add-Profit brought forward 0.79 0.58
Net Profit available for 1142.35 1503.45
appropriation
APPROPRIATION
Transfer to Statutory reserve 286.00 376.00
Transfer to Revenue and 16.00 692.00
Other reserves
Transfer to Special Reserve 565.00 82.00
u/s 36(1)(viii) of I-T Act
Transfer to capital reserve 6.98 -
Proposed Dividend 230.49 303.43
Tax on Dividend 37.39 49.23
Balance carried over to 0.49 0.79
Balance Sheet
5. DIVIDEND
Your Bank's policy of declaring dividend is to reward the share holders
as well as to plough back profit for maintaining a healthy capital
adequacy ratio & for supporting future growth. Accordingly, your
Directors are pleased to propose a total dividend of 79 % (i.e Rs.7.90
per share) for the year ended 31st March, 2012 as against 104 %(i.e.
Rs.10.40 per share) paid for the preceding year.
6. SECTORAL DEPLOYMENT OF CREDIT TO PRIORITY SECTOR
Bank's advances to priority sector increased by Rs4875.83 crore from
Rs. 35650.71 crore in March 2011 to Rs. 40526.54 crore in March 2012
registering a growth of 13.68%. The Priority Sector Advances
constituted 42.26% of the Adjusted Net Bank Credit (ANBC) against the
stipulation of 40%. The comparative position of advances under various
segments under Priority Sector as at the end of March 2011 and March
2012 is as follows:
(Amount Rs in crore)
S.No. Sectors March 2011 March 2012
1. Priority sector credit 35650.71 40526.54
2. Agriculture 12721.13 15411.10
3. Direct Agriculture 8887.91 11860.40
4. Indirect Agriculture 3833.22 3550.70
5. SSI / SE 15844.45 17978.48
6. Educational Loan 1065.15 1123.99
7. Housing Loan 5979.69 5981.89
8. Other P.S. 40.29 31.08
6.1 Agriculture Advances
Bank's advances to agriculture increased by Rs.2689.97crore from
12721.13 crore in March 2011 to Rs.15411.10 crore in March 2012,
registering a growth of 21.15%. The advances to direct agriculture
segment increased by Rs.2972.49 crore from Rs .8887.91crore as on
31.3.2011 to Rs11860.40 crore as on 31.3.2012 constituting a growth of
33.44%. The Indirect agriculture advances decreased by Rs.282.52 crore
from Rs.3833.22 crore as on 31.3.2011 to Rs.3550.70 crore as on
31.3.2012 showing an decrease of 7.37% due to change in norms of
classification of indirect agriculture loans by R B I .
6.1.1. Flow of credit to Agriculture sector (Fresh disbursement)
During the financial year 2011-12, fresh flow of credit to agriculture
sector amounted to Rs. 9174.00 crore.
6.1.2. Small and Medium Enterprises (SMEs)
Bank's exposure to Small Enterprises sector stood at Rs.17978.48 crore
at the end of March ,2012 and has shown an increase of Rs..2134.03
crore, recording a growth rate of 13.47%. Further, SME advances
increased by Rs.2456.24 crore to Rs.20126.51crore registering a growth
of 13.90% against the Year on Year growth stipulation of 20%. The Micro
sector advances increased by Rs.929.42 crore to Rs.6046.37 crore
posting a growth of 18.16%. Bank has entered into a MOU with NSIC for
outsourcing credit proposals for lending.
6.1.3. Oriental Green Card (OGC) & Oriental Kisan Gold Card (OKGC)
During the Financial Year 2011-12, Bank has issued 1,22,233 cards to
farmers to meet their credit requirement for crop production, repairing
of agricultural machinery & equipment, working capital for allied
activities, and consumption needs. The total amount of loan disbursed
through these cards during the year was Rs.2829.72 crore.
6.1.4. Oriental Bank Grameen Project ( OBGP )
Bank is providing finance to rural poor under home grown model of micro
finance viz. Oriental Bank Grameen Project. It is being implemented
through Joint Liability Group concept consisting of 5 members in each
group, preferably women.
The Bank has formed 4288 Groups reaching out to 21440 poor families
spread across 251 villages. The cumulative amount advanced to these
groups as at the end of March 2012 was Rs. 30.51 crore. Savings to the
tune of Rs. 9.16 crore have been mobilized by the groups.
6.1.5. Advances to Weaker Sections
Advances to weaker sections, consisting of beneficiaries belonging to
scheduled castes/scheduled tribes, small and marginal farmers, landless
labourers, rural artisans, beneficiaries under Govt. Sponsored schemes
(except PMRY) were of the order of Rs. 8702.69 crore as a the end of
March 2012 as against Rs. 6221.02 crore as at the end of March 2011.
6.1.6. Credit under Differential Rate of Interest Scheme Credit flow
at concessional rate of interest of 4% p.a. to the low- income group of
the society both in rural and urban centres having annual family income
upto Rs. 18,000/- and upto Rs. 24,000/- respectively was Rs. 59.52
crore as at the end of March 2012.
6.1.7. Loans to SCs/STs
Bank continues its thrust in providing financial assistance to SCs/STs
beneficiaries. The advances to these beneficiaries improved to Rs
732.10 crore in March 2012 against Rs. 530.66 crore as at the end of
March 2011.
6.1.8. Prime Minister Employment Generation Programme (PMEGP)
The Scheme has been implemented by the Government of India by merging
the two existing schemes viz. PMRY and REGP w.e.f. 1st April 2008. The
scheme aims for generation of employment opportunities through
establishment of micro enterprises in rural as well as urban areas. The
bank has sanctioned credit assistance to the tune to Rs 45.17 crores to
1085 applicants under the scheme during the year 2011-12.
6.1.9. Swaran Jyanti Shahri Rojgar Yojana (SJSRY)
For providing gainful employment to urban poor (living below the urban
poverty line) through setting up self employment ventures, bank is
providing financial assistance under the scheme since its inception.
The bank sanctioned to 2436 beneficiaries to the tune of Rs.12.28
crores during 2011-12.
6.1.10. Swarn Jyanti Gram Swarojgar Yojana (SGSY)
The scheme is operative in rural areas of the country and cover the
aspects of self employment such as organization of rural poor into Self
Help Group (SHGs) training credit technology, infrastructure and
marketing. The bank is participating in the schemes. During 2011-12
bank sanctioned financial assistance to 271 swarojgaries to the tune of
2.91 crore.
6.1.11. Credit Flow to Women Beneficiaries
Women are assuming greater responsibilities and playing an active role
in the economic growth of the nation but remain under represented while
receiving the credit delivery from the Financial Institutions of the
country. So for strengthening of credit flow to women, Bank has
implemented 13-points action plan as advised by the Government of
India. Bank has designated 10 branches as specialized branches for
women entrepreneurs.
A number of credit schemes, such as Oriental Mahila Vikas Yojana, Loan
scheme for Professional & Self Employed Women, Loan scheme for Beauty
Parlour/ Boutiques/ Saloons/ Tailoring, Scheme for Financing Working
Women, etc. are designed by the bank especially for women. Besides, a
special project called Oriental Bank Grameen Project (OBGP) provides
all types of banking assistance to the rural poor women.
As a result the Bank's advance to women increased by Rs. 527 crore from
Rs. 4279 crore as on March 2011 to Rs. 4806 crore as on March 2012
registering a growth of 12.31%. Bank's advances to women beneficiaries
as on March 2012 was 5.01% of ANBC against the required stipulation of
5%.
6.1.12. Financial Inclusion
With a view to provide banking facilities in un banked villages, Bank
has rolled out Financial Inclusion Plan in all the 569 allotted
villages
with population more than 2,000. Bank has covered 492 villages through
Business Correspondent model, 23 villages through Branch Model and 54
villages through Mobile Branch Model.
Bank has opened a total number of 4,38,314 No-Frill/ Other savings
accounts in these 569 villages. Further 1,59,207 customers have been
issued activated Bio-metric cards for extending IT enabled banking
services.
Bank is also participating in distribution of Social Welfare scheme
funds in 6 districts namely Amritsar, Muktsar, Gurdaspur (Punjab),
Sriganganagar, Hanumangarh (Rajasthan) and Jind (Haryana). A total
number of 2,75,766 beneficiaries have been issued Bio- metric cards/
Smart cards for distribution of benefits of Social Welfare schemes.
6.1.13 State Level Bankers Committee Responsibility
For the first time Bank has been bestowed with prestigious assignment
of Convener - State Level Bankers' Committee for Delhi State by the
Government of India from November, 2011. Bank has taken over reins
from State Bank of India. There are 33 member banks of SLBC - Delhi
State which include all prominent banks i.e. PSBs, Private Sector Banks
and Coop Banks. Delhi State is served by 2544 branches of these member
banks.
6.1.14. Lead Bank Responsibility
Bank is performing the functions of Lead Bank in three Districts namely
Ferozpur in Punjab, Sriganganagar in Rajasthan and Palwal in Haryana.
6.1.15.OBC Rural Development Trust
Bank has set up a special purpose vehicle in the name of Oriental Bank
Rural Development Trust (OBCRDT) for setting up Training Centres at
various places across the country for imparting training for capacity
building in rural areas. The Trust came into being on the 9th December
2005 as a registered body.
The main objective of the Trust is to establish training
colleges/institutes and workshops for providing training for farmers on
modern techniques of farming, tractor/farm machinery repair &
maintenance and other aspects of agriculture/rural development; micro
finance and capacity building of the rural youth and women.
Presently five OBCRSETIs (OBC Rural Self Employment Training
Institutes) are functional at Dehradun, Sriganganagar, Jaipur,
Ferozepur and Palwal. We have been allotted land by the State
Governments in Chomu (Jaipur), Rajasthan, Zira (Ferozepur), Punjab,
Jassowal (Dehradun) Uttrakhand, Manaksar (Sriganganagar) Rajasthan and
Palwal, Haryana.
The RSETI building at Chomu was inaugurated by Shri. Namo Narain Meena
Hon'ble Union Minister of State for Finance on 30.03.2011.
Construction work is almost complete at Zira (Ferozepur). Govt of India
has sanctioned an amount of Rs. 3 crores for constructions at Zira,
Jassowal and Manaksar .
During the Financial Year 2011-12, a total of 170 training programmes
were conducted and 5236 candidates were given training. Of these 62
were entrepreneurship development programmes on subjects like tailoring
& dress designing, watershed management, phulkari embroidery, milch
animal rearing, crop production, beauty parlour, medicinal plantation,
etc which benefitted 1325 candidates. A total of 362 trained persons
were credit linked for pursuing/setting up of economic activities.
Emphasis is also given to train candidates from BPL strata of the
society for which list of candidates is obtained by the centres from
respective DRDA. Cumulatively these centres have conducted 753 training
programmes since inception benefiting 25848 candidates
6.2 RETAIL CREDIT
Retail Credit segment continues to be the thrust area of lending. The
bank is having 15 Retail Credit Schemes including Home loans to meet
the requirements of various sections of the society. Our Retail Credit
Schemes are customer friendly, competitive and specifically designed to
suit all sections of the society. The Bank has revised the
discretionary powers of field functionaries for quick disposal of loan
application & also made our interest rate competitive.
6.3 EDUCATION LOAN
The Education Loan portfolio of the Bank stood at Rs. 1191.07 Crore as
on 31.03.2012 and showed Y.O.Y Growth of 8.04%. Bank continued its
efforts for extending education loans to students on soft terms &
conditions and competitive rates besides 0.50% concessions in rate of
interest to girl students are being given. During the year Bank has
revised Education Loan Scheme as per IBA guidelines and has also
launched new IBA formulated Education Loan for vocational courses.
7. TREASURY OPERATIONS:
The G-Sec yields hardened during FY 2011-12 owing to sticky inflation,
higher Government borrowing and higher fiscal deficit. RBI raised Repo
and Reverse Repo rates by 125 bps during FY 2011-12 to rein in
inflation and prevent inflationary pressure building in the economy.
The equity markets underperformed owing to bleak domestic and global
economic scenario. The secondary market turnover has been Rs. 93,416.91
Crores in FY 2011-12. The net profit in the secondary market operations
has been Rs.170.26 Crores during FY 2011-12. The Bank has not
transferred any securities from 'Available for Sale' category to 'Held
to Maturity' category and transferred Rs. 2263.84 Crores from 'Held to
Maturity' category to 'Available for Sale' category during 2011-12, and
in the process booked depreciation of Rs. 4.53 Crores. Bank also
transferred securities amounting to Rs.0.85 crores from 'Held for
Trading' to 'Available for Sale' category by booking depreciation of
Rs.0.20 crores. The aggregate investments of the Bank have increased to
Rs. 52,460.23 Crores in FY 2011-12 from Rs.49,623.69 crores previous
financial year, an increase of 5.72%. The yield on investments has
increased to 7.36 % from 7.21% last year (excluding income on RIDF
deposits classified as Non-SLR investments) owing to rise in the yield
of fixed income securities in the investment portfolio.
8. Merchant Banking Activities:
The Bank has been registered as Depository Participant with both NSDL &
CSDL. More than 73,000 customers are availing the demat services of the
Bank and PAN non-complaint zero balance accounts have been closed as
per SEBI directive. The number of branches offering demat services are
307. The Bank is also offering online trading services in collaboration
with IDBI Capital Market Services and Karvy Stock Broking Ltd. for its
customers.
8.1 Applications supported by Blocked Amount (ASBA)
Our Bank has been registered with SEBI as Self Certified Syndicate Bank
(SCSB) for providing Applications Supported by Blocked Amount (ASBA)
facility to its customers. ASBA is an application containing an
authorisation to block the application money in the bank account
maintained with SCSB.
Under the ASBA facility, the application amount for subscribing to an
issue (IPO/Rights issue), remains in the bank account of the customer
till allotment is finalized and actual amount equal to allotted shares
is only debited instead of total application amount.
The Bank is providing ASBA offline facility through 552 authorized
branches across the country Online ASBA facility has also been started
in March 2012. (From July, 2011 our Bank has started "Syndicate ASBA"
operations and for that purpose there are 12 designated Syndicate ASBA
branches.)*
9. Foreign Exchange Business
During the fiscal year 2011-12, Forex turnover increased to Rs
96,753.46 Crore as on 31.03.2012 as against Rs 66,912.60 Crore as on
31.03.2011, thus registering a growth of44.60%. The Export credit of
the Bank stood at Rs 4,976 Crore as on 31.03.2012 as against Rs 4,356
Crore as on 31.03.2011, thus registering a growth of 14.23%. Bank has
94 Specialized Branches to conduct foreign exchange business. The total
earning from foreign exchange Business registered a substantial
increase to Rs 280.50 Crore for the year ended 31.03.2012 as against Rs
225.63 Crore during the financial year ended 31.03.2011 , registering a
growth of 24.32% over the preceding financial year. The Bank has
mobilized Non Resident deposits to the tune of Rs 2323 Crores as on
31.03.2012 as against Rs 1755 Crores for the year ended 31.03.2011,
thereby registering a growth of 32.36% over the preceding financial
year. The operations at Representative Office, Dubai has completed
three years of operations, acting as a catalyst to canvass non-
resident accounts of Indian Expatriates in UAE to expand the Non-
resident customer base of the bank.
The Bank started selling 999.9 Gold coins in different denominations
w.e.f 30.10.2010 through 68 Authorized Branches. During the current
financial year, the Authorized Branch network to sell Gold coins has
been increased to 216 Branches covering all the Regions of the Bank.
Bank has sold 18480 gold coins weighing 136.19 kg and earned a net
profit of Rs 1.86 Crore during the F.Y 2011-12, as against 0.37 Crore
during the previous F.Y 2010-11.
10. THIRD PARTY PRODUCTS:
10.1 Life Insurance Business (JV):
During FY 2011-12, the Bank has sold 28318 policies with First Premium
Collection of Rs. 100.28 Crores and has earned commission of Rs. 14.41
Crores (Net).
10.2 General Insurance Business:
In General Insurance Business, the Bank has again registered a steady
growth and has collected a Premium of Rs. 33.36 Crores earning a
Commission of Rs. 3.68 Crores.
10.3 Oriental Bank Mediclaim Policy :
Our Bank signed an MoU with Oriental Insurance Company on 3rd Oct'2011
and launched the Oriental Bank Mediclaim Policy. The Product has been
designed exclusively for OBC Customers and available in all OBC
Branches across the country. During the period from 03.10.2011 to
31.03.2012, 9976 policies have been sold by the Bank.
10.4 Mutual Fund Business:
The Bank has Tie Up with 6 Asset Management Companies (AMCs) for
selling different Mutual Fund products. During the FY 2011-12, the Bank
has collected AUM of Rs. 57.45 Crores by selling Mutual Fund Products
and earned income of Rs. 43.09 Lacs under this segment.
10.5 New Pension Scheme (NPS):
Pension Fund Regulatory and Development Authority (PFRDA) has appointed
our Bank as Points of Presence (POP) w.e.f. 01.05.2009 for the purpose
of subscribing to New Pension Scheme (NPS) for all citizens of India.
Total 505 branches are registered to act as POP-SPs as on 31.03.2012
and 183 NPS accounts have been opened till 31.03.2012.
10.6 Demat Accounts:
The Bank is a Depository Participant for both NSDL and CDSL. As on
31.03.2012, our Bank has 73861 Demat accounts and has generated a
revenue of Rs.3.72 Crores during FY 2011-12. The Bank has tied up with
M/s IDBI Capital Market Services Ltd. & M/s Karvy Stock Broking Limited
for providing Online Trading services to its Demat Account holders
through 297 Demat Authorized Branches.
10.7 Gold Coins:
The Retail sale of Gold Coins in different denominations (5 grams, 8
grams & 10 grams) was launched on 30.10.2010 in our Bank. During the
FY 2011-12, our Bank has sold 18480 Gold Coins through 216 designated
branches across all the 30 Regions and earned a profit of Rs. 1.86
Crores.
10.8 UID Cards:
The Bank has entered into MoU with Unique Identification Authority of
India (UIDAI) on 11.08.2010 as Registrar for issuing UID-Aadhaar Number
to Residents of India. Bank has successfully completed more than 19.80
Lac UID enrolments all over India out of which approximately 16.75 lac
UID were issued through our Bank till 31.03.2012. Bank has booked and
earned a profit of Rs. 3.79 crore till 31st March, 2012.
10.9 Cash Management Services (CMS):
The Bank provides an efficient and tailor-made CMS solution to suit the
customer requirements. The Bank is offering Collections, Payments and
Custodial Services to the Customers under Cash Management Services. The
Bank has coverage of more than 126 cities through own Branches and 500
Locations through Correspondent arrangements offering CMS services to
clients across the country. The Bank has registered a turnover of above
Rs. 910.41 Crores and earned Non-Interest income of Rs.1.27 Crore
during FY 2011-12.
10.10 SBI-OBC Co-Branded Credit cards
Our Bank signed an MoU with SBI Cards on 14th Sep'2011 and launched the
Co-Branded Credit Cards on 22nd Oct'2011.There are two types of Credit
Cards to be issued: (i)SBI-Oriental Bank of Commerce Gold & More (ii)
SBI-Oriental Bank of Commerce Platinum. The cards is being issued in
two variants:1.Secured 2.Unsecured. For sourcing unsecured credit
cards, 18 Regions and 455 Branches have been mapped. Secured Cards can
be issued in all the branches. As on 31.03.2012, 8550 unsecured cards
are sourced by our branches out of which 5910 cards were issued.
10.11 e-Stamping services
The Bank signed MoU with Stock Holding Corporation of India Ltd.
(SHCIL) on 27.07.2011 to act as Authorized Collection Centre (ACC) for
e-Stamping services. It has already started in 8 branches of Gujarat
and 1 branch of Karnataka. The Bank has also received the approval from
Govt. of NCT of Delhi for starting e-Stamping services in Delhi.
11. BRANCH EXPANSION
During 2011-12, the Bank has opened 147 new branches besides up
gradation of 5 Extension Counters. As on 31.03.2012, the total number
of branches stood at 1772 as against 1620 as on 31.03.2011. The
population group-wise classification of branches is as under :
S.N. Classification 31.03.2012 31.03.2011
1 Rural 369 334
2 Semi-Urban 482 423
3 Urban 524 489
4 Metropolitan 397 374
Total 1772 1620
12. CUSTOMER SERVICE
The Bank in its endeavor to achieve excellence in customer service has
started many customer friendly services viz. Mobile Banking (OBCMPAY)
besides Internet Banking Services both for individuals and corporates,
SMS alert service, Cheque/Cash deposit facility through some of the
Bank's ATMs. Funds transfer through ATMs, RTGS/NEFT, facility of Cheque
Status Inquiry and Stop cheque payment available 24x7 on Bank's ATMs,
deployment of Point of Sale (POS) Terminals at the identified
prospective Merchant Establishments, State-of-the-Art e-Lobbies at
select centres, Electronic Cheque deposit machines at some of the
branches to facilitate cheque deposit with acknowledgment generated by
the machine itself, online payment of service taxes etc. These services
are helpful for the customers to get their transactions done speedily
and easily. For Senior Citizens customers there is provision for
separate queue in the branches. The Bank has adopted and implemented
voluntary codes of BCSBI for individual customers , Fair Practice code
for lenders, Micro and Small Enterprise (MSEs) code to provide fair ,
transparent and quality service to all the customers and to provide
greatest satisfaction to the customers. The codes are displayed on the
Bank's website for information and printed copies are also available at
branches for customers information. The updated information on Bank's
Deposit Schemes, Loan Schemes, Citizen's Charter, Banking Ombudsman,
SSI Charter, Forex Remittances, Service Charges and Bank's Policies viz
Financial Inclusion Policy, Cheque Collection and Compensation Policy,
Grievance Redressal Policy, Policy on Collection of dues & Repossession
of Security etc. have been displayed in Public domain of Bank's
website. These are also available at branches in booklet/pamphlet form.
"Query & Suggestion" link is provided on website to get feedback
from customers. Complaint/Suggestion Boxes are provided at branches
where a customer can drop his/her complaint or suggestion.
The Customer Service Meetings are being held regularly at Branch level
, Regional Office level and Head Office level. These meetings ensure
the proper implementation of guidelines issued by regulatory
authorities. The customers are invited to attend these meetings and
give their valuable suggestion/feedback on bank's services and schemes.
The Bank is committed to give excellent customer service for the
customers' maximum satisfaction.
Web-based Customer Grievance Redressal system is provided for prompt
redressal of customers grievances. A dedicated Customer Care Centre on
toll free Number 1800-180-1235 has been set up for clarifying the
customers account related and other queries.
13. KNOW YOUR CUSTOMER (KYC) NORMS & ANTIMONEY LAUNDERING (AML)
MEASURES
To comply with the various laws and regulations, national as well as
international, Govt. of India and Reserve Bank of India directives /
instructions & guidelines, primarily to prevent the bank from being
used, intentionally or unintentionally, by criminal elements for money
laundering activities, OBC 'KYC' Policy has been formulated. The Policy
combines four key elements viz. "Customer Acceptance Policy",
"Customer Identification Procedures", "Monitoring of Transactions" and
"Risk Management". This will enable the bank to know / understand the
customers and their financial dealings better and shall further help in
managing risks more prudently. The detailed guidelines and subsequent
instructions are being reiterated from time to time for strict
compliance by the field functionaries. The bank is already complying
with the requirement of submission of statutory returns to the FIU-IND
as a sequel to the new legislation on Prevention of Money Laundering
Act-2002. The Bank has already operationalised Anti-Money Laundering
software solution for complying with KYC Norms / AML Measures and
generation of alerts to detect any suspicious transaction. Alerts are
being scrutinized by us and STRs are being submitted to FIU-IND. Bank
is also submitting all the required data/returns relating to KYC/AML to
the regulatory bodies.
14. USE OF HINDI IN THE BANK
During the year 2011-12, Bank continued its concerted efforts to
accelerate use of Hindi and implement the guidelines/directives
received from Govt. of India and Reserve Bank of India. Concrete and
effective steps were taken to achieve the region wise targets set in
the Annual Programme- 2011-12 by the Department of Official Language,
Ministry of Home Affairs, Govt. of India Bank was awarded Consolation
prize in 'B' region under Reserve Bank Rajbhasha Shield Competition
2010-11 for Public Sector Banks/Financial Institutions for its
excellent performance in the field of Rajbhasha Hindi. Bank was awarded
Third Prize for doing good work in Hindi under Inter Bank Rajbhasha
Shield Competition - 2010-11 and our Bank's In-House Magazine AADHAAR
was awarded Third Prize by the Delhi Bank's Town Official Language
Implementation Committee. Besides, our Regional Offices, Ludhiana &
Jaipur were awarded Second Prize by Town Official Language
Implementation Committees, Ludhiana & Jaipur respectively. Branch
Office Coimbatore was awarded Second prize by TOLIC Coimbatore for
doing excellent work in Hindi.
Drafting & Evidence Sub-Committee of the Committee of Parliament on
official Language held discussions on progress made in use of Hindi
with Regional Head, Jaipur on 20.09.2011 and appreciated the work being
done in Hindi in the Bank.
Bank continued its efforts to promote use of Hindi in field of
Information Technology. Rules and Directives regarding Official
Language Policy, English-Hindi Banking Glossary, Bilingual Softwares
and Templates of routine Hindi letters of various departments were
provided online at OBC Web Portal to facilitate working in Hindi.
Officers/ Employees were imparted training to work on computer in Hindi
and send e-mail in Hindi with the help of Unicode. Bilingual Software
Script Magic was installed in the branches of the Bank to provide
banking facilities to customers in Hindi . Job -Cards regarding working
in Hindi in Finacle were made available on Portal . Bank's e-circulars
and Executive's messages, policies, deposit / loan schemes, retail
schemes, Power chart, Finacle menues, branch directory, ATM list etc.
were made available in Hindi on OBC web portal. Bank's Website is
available in Hindi and English.
Hindi-Day and Hindi-Fortnight were celebrated in different offices /
branches of the Bank in the month of September,2011 and various Hindi
competitions were conducted for the staff members. An All India Hindi
Essay Competition was conducted by the Head Office. Bank also
conducted an Inter Bank Hindi Essay Competition under the auspices of
Delhi Banks Town Official Language Implementation Committee. The
winners of the competitions were awarded certificates & prizes.
Besides, our staff members won prizes in various Inter Bank
competitions too.
Bank's quarterly In-House Magazine "AADHAAR" was published regularly in
bilingual form i.e. in Hindi and English.
15. RECOVERY:
The Bank has made concerted efforts for recovery of NPAs and as a
result of this the Bank could make Cash Recovery of Rs.945.64 Crore
during the Financial Year 2011-12. Out of the said Cash Recovery, a sum
of Rs.323.07 Crore has been added as recovery towards the Revenue of
the Bank. Further, all the available recovery mechanism have been
utilized by the Bank, viz. holding of Recovery Camps, floating of
"Special One Time Settlement Schemes for NPAs with O/S upto Rs. 5.00
Lakh" and with O/S upto Rs. 10.00 Lakh, participating in Lok Adalats,
taking action under SARFAESI Act-2002, initiating legal action in the
competent Courts of Law and settling of cases under general settlement
policy of the Bank. However, the impact of global recession, Indian
economy has also been affected adversely and the NPAs of the Bank has
increased in comparison to the previous financial year resulting in
increase in Gross NPA percentage to gross advances to 3.17% against
1.98% of corresponding F.Y. The Net NPA of the bank has also increased
to 2.21% against 0.98% of corresponding F.Y.
The Bank is taking all possible efforts to strengthen the recovery
mechanism to minimize the higher delinquencies
16. HUMAN RESOURCE DEVELOPMENT & TRAINING
Indian banking industry is governed by the policies and priorities of
the Government, directives of Reserve Bank of India and Banking
Regulation Act, 1949. Banking activities are guided by economic and
social conditions of the masses.
The training plan for 2011-12 has been prepared keeping in view the
above objectives and various task / challenges before the Bank. In the
midst of the above the Bank has also drawn a tagline for training
during the year "Attitude comes first". The idea is to bring
attitudinal change among staff members with customer centric approach.
The Bank was able to meet the above objective to a large extent. The
focus of training during the year was on the following areas:
Credit Management, Risk Management, Forex Management, Customer
Relationship Management, NPA & Recovery Management, Agriculture
Financing & Rural Development, Retail Banking Products; Financial
Inclusion; Management Development Programme for Executives; Soft Skills
Development, Workshops on HRMS; CBS & IT Products, SC/ST/OBC
Reservation Policy etc.
In 677 programmes 15761 employees were imparted training in the above
streams and other areas of Banking. In addition, 861 officers were
nominated in Advanced Training Programmes in key operational and
behavioural areas in pioneer institutions like NIBM, Pune, College of
Agricultural Banking, Pune; IBA, Mumbai; IDRBT, Hyderabad; NIBSCOM,
Noida etc. Few Senior and Top Management functionaries were deputed for
overseas training for Management Development Programmes/ Conferences/
Seminars to give exposure to International best practices and their
impact in Indian Banking.
During the year 2011-12, the Bank recruited 452 Probationary Officers,
1327 Clerks, 159 Subordinate Staff and 311 Specialist Officers in
different grades and streams such as Sr. Manager (FA), Manager (IT),
Marketing Managers, Manager (FA), Manager (Credit & Risk), Manager
(Law), Officer (IT), Officer (FA), Agriculture Officers, etc. The Bank
further during the ensuing year plan to recruit around 1100 employees.
The total staff strength as on 31st March, 2012 is 18371 comprising of
9440 Officers, 5949 Non-subordinate and 2982 Subordinates. The Bank
also promoted 955 employees to different cadre during the year 2011-12.
The Bank complied with Government guidelines in respect of reservation
in recruitment and promotion for SC/ST/OBC/ PWD/Ex-Servicemen in letter
and spirit. The Bank recruited 1132 SC/ST/OBC category personnel in
Officer, Clerical & Subordinate cadres during the year. The grievances
of SC/ST/OBC employees, if any, were resolved through SC/ST and OBC
Cells created at all Regional Offices and at Head Office with the
coordination of Liaison Officers/Chief Liaison Officer.
BOARD OF DIRECTORS
During 2011-2012, 12 meetings of Board of Directors, 22 meetings of
Management Committee of Board, 11 meetings of Audit Committee of Board,
were held.
During the year, Sh.S L Bansal, Chairman and Managing Director, took
charge of the Bank on 01.03.12 after the superannuation of Sh. Nagesh
Pydah. Smt Sreya Guha, joined the Board of the Bank as Government of
India Nominee Director under Sec 9 (3) (b) of the Banking Companies
(Acquisition and Transfer of Undertakings) Act, 1980. Sh.C.P.Singh and
Sh.K.S.Sreenivasan, joined the Board of the Bank on 22.09.2011 and
23.09.2011 as Part-time Non-Official Director and Chartered Accountant
Director respectively, appointed by Government of India under Section 9
(3) (h) and Section 9 (3) (g) of the Banking (Acquisition and Transfer
of Undertakings ) Act, 1980.
Sh.T Valliappan, Dr.Abha Chaturvedi and Sh.P B Santhanakrishnan were
elected as Shareholder Directors, also joined the Board of the Bank
w.e.f 30.09.2011, under Sec 9 (3) (i) of the Banking Companies
(Acquisition and Transfer of Undertakings) Act, 1980.
DIRECTOR'S RESPONSIBILITY STATEMENT
The Directors confirm that, in the preparation of the Annual Accounts
for the year ended 31st March, 2012
a) the applicable standards have been followed along with proper
explanation relating to material departures, if any,
b) the accounting policies framed in accordance with the guidelines of
the Reserve Bank of India, were consistently applied,
c) reasonable and prudent judgment and estimates were made so as to
give true and fair view of the state of affairs of the Bank at the end
of financial year and of the profits of the Bank for the year ended on
31st March, 2012,
d) proper and sufficient care was taken for the maintenance of adequate
accounting records in accordance with the provisions of applicable laws
governing banks in India and the accounts have been prepared on a going
concern basis.
ACKNOWLEDGEMENTS
The Board of Directors thanks Government of India, Ministry of Finance,
Department of Economic Affairs and Reserve Bank of India and other
Government & Regulatory Agencies for their valuable guidance and
continued support provided to the Bank throughout the year. The Board
of Directors are also grateful to the valued customers, esteemed
shareholders, stakeholders and public at large for their patronage and
confidence reposed in the Bank.
The Board of Directors place on record their great appreciation of the
commitment, sense of involvement and dedication exhibited by each staff
member in the overall development, growth and prosperity of the Bank
and look forward to their continued support and whole-hearted
co-operation for realization of the corporate goals in the year ahead.
For and on behalf of the Board
New Delhi (S.L. BANSAL)
30th April 2012 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2011
The Board of Directors have pleasure in presenting this Annual Report
together with the Audited balance Sheet and Profit & Loss Account of
the Bankforthe year ended 31st March, 2011.
1. BUSINESSOPERATIONS
The Business of the Bank stood at Rs. 235893.16 crore on 31st March
2011 as against Rs. 204441.53 crores in the previous year. Total
deposits of the Bank stood at Rs. 139054.26 crore and have shown an
increase of Rs. 18796.67 crore depicting a growth of 15.63%. Cost of
deposit stood at 6.03% as against 6.57% for financial year 2009-10. The
Bank has taken conscious decision of shedding high cost deposit and
substituting the same with normal rate and lower cost deposits so as to
contain the cost of deposits. On the other hand, net advances as at
31st March 2011 stood at Rs. 95908.22 crore, registering a growth of
14.87%. During the fiscal 2010-11, yield on advances has increased to
10.32% from previous years level of 10.20%. The measures taken up by
the bank to improve yield on advances through lending to SME, Mid
Corporate and Retail sector besides implementation of Base Rate has
enabled the bank to improve the yield on advances.
The credit deposit ratio of the Bank, as at 31st March 2011, stood at
69.73% . The Bank ensured adequate flow of credit to the productive
sectors of the economy. The Loans & Advances portfolio of the bank is
well diversified and balanced. The Bank has ensured that its exposure
to sensitive sectors such as Capital Markets, Real Estate, NBFCs etc.
is well within the regulatory & prudential cap.
2. CAPITAL & RESERVES
During the year, the bank transferred a sum of Rs.1150 crore to
Reserves (which includes Rs. 376.00 crore transferred to Statutory
Reserves, Rs. 774.00 crore to Revenue and other Reserves) out of the
profit for the year 2010-11. With this, capital & reserves as on March
31, 2011 have gone upto Rs.11097.14 crore as against Rs. 8237.95 crore
as at end March 2010 and the ratio of Capital & Reserves to average
working funds stood at 7.62% as on 31.03.2011 as against 6.61% as on
31st March 2010.
3. CAPITAL ADEQUACY RATIO
As on March 31. 2011 the Capital Adequacy Ratio of the Bank under Basel
-II stood at 14.23% as against 12.54% as on 31st March, 2010(under
Basel-ll). This is well above the regulatory minimum requirement of
9.0%.
4. FINANCIAL PERFORMANCE
The Bank has posted a total income of Rs. 13047.89 crore during the
year as against Rs. 11457.17 crore last year thus registering an
increase of Rs. 1590.72 crore (a growth of 13.88% during the fiscal
2010-11. Operating Profit of the Bank has increased to Rs. 3245.14
crore as against Rs 2421.50 crore last year showing a growth of 34.01 %
The Bank has made a net profit of Rs. 1502.87 crore, after making all
requisite provisions showing an increase of Rs. 368.19 crore (growth of
32.45%) during the fiscal 2010-11.
Appropriation from the Net Profit have been effected as per table given
on next page:-
Table 1: Financial Performance (Rupees in crore)
31.03.2011 31.03.2010
Interest Income 12087.82 10257.13
Other Income 960.07 1200.04
Total Income 13047.89 11457.17
Interest Paid 7910.27 7349.69
Operating Expenses 1892.48 1685.98
Total Expenses 9802.75 9035.67
Operating Profit 3245.14 2421.50
Provisions & Contingencies 1742.27 1286.82
Net Profit 1502.87 1134.68
Add-Profit brought forward 0.58 0.83
Net Profit available for 1503.45 1135.51
appropriation
APPROPRIATION
Transfer to Statutory reserve 376.00 284.00
Transfer to Revenue and 692.00 351.00
Other reserves
Transfer to Special Reserve 82.00 60.00
u/s36(1)(viii) of I-T Act
Transferto capital reserve -- 173.19
Proposed Dividend 303.43 227.99
Tax on Dividend 49.22 38.75
Balance carried over to 0.79 0.58
Balance Sheet
5. DIVIDEND
Your Banks policy of declaring dividend is to reward the share holders
as well as to plough back profit for maintaining a healthy capital
adequacy ratio & for supporting future growth. Accordingly, your
Directors are pleased to propose a total dividend of 104 % (i.e
Rs.10.40 per share)for the year ended 31st March, 2011 as against 91
%(i.e. Rs.9.10 pershare) paid for the preceding year.
6. SECTORAL DEPLOYMENT OF CREDIT TO PRIORITY SECTOR
Banks advances to priority sector increased by Rs. 6267.10 crore from
Rs. 29383.61 crore in March 2010 to Rs. 35650.71 crore in March 2011
registering a growth of 21.33%. The Priority Sector Advances
constituted 42.70% of the Adjusted Net Bank Credit (ANBC) against the
stipulation of 40%. The comparative position of advances under various
segments under Priority Sector as at the end of March 2010 and March
2011 is as follows:
(Amount Rs. in crore)
S.No. Sectors March 2010 March 2011
1. Priority sector credit 29383.61 35650.71
2. Agriculture 11267.51 12721.13
3. DirectAgriculture 6564.47 8887.91
4. Indirect Agriculture 4703.04 3833.22
5. SSI/SE 10868.81 15844.45
6. Educational Loan 942.72 1065.15
7. Housing Loan 6258.03 5979.69
8. Other P.S. 46.544 0.29
6.1 Agriculture Advances
Banks advances to agriculture increased by Rs. 1453.62 crore from
Rs.11267.51 crore in March 2010 to Rs.12721.13 crore in March 2011,
registering a growth of 12.90%. The advances to direct agriculture
segment increased by Rs.2323.44 crore from Rs.6564.47crore as on
31.3.2010 to Rs.8887.91 crore as on 31.3.2011 constituting a growth of
35.39%. The Indirect agriculture advances decreased by Rs.869.82 crore
from Rs.4703.04 crore as on 31.3.2010 to Rs.3833.22 crore as on
31.3.2011 showing an decrease of 18.49% due to change in norms of
classification of indirect agriculture loans by RBI.
6.1.1. Flow of credit to Agriculture sector (Fresh disbursement) During
the financial year 2010-11, fresh disbursement of credit to agriculture
sector amounted to Rs. 6947.06 crore. During the year, a total of
221651 new agriculture loan accounts were added. There was an average
addition of 293 new agriculture loan accounts per rural and semi-urban
branch against stipulation of 250 acconts.
6.1.2. Hi-Tech Dairy
The bank is providing credit to rural youths for their self employment
under Hi Tech commercial dairy scheme. Under the scheme State
Government Agencies / Dairy Development Boards impart one month
training to unemployed youth for their skill upgradation. As on
31.03.11, an amount of Rs. 84.03 Crore has been sanctioned to 722
units.
6.1.3. Oriental Saur Urja Dohan Scheme
With a view to exploit the extensive use of unconventional energy
resources and reduce the dependence on limited fossil fuel, the bank is
implementing a scheme for financing solar water heating & lighting
system, for creating a viable alternate to conventional source of
energy. The scheme is open to individual, institutional, commercial and
industrial users. Bank is also providing loan for solar water heating
system, under MNRE scheme of IREDA. The bank finance for Solar Water
Heating System amounted to Rs. 25.79 Lac under MNRE tie up arrangement
and bank claimed subsidy of Rs. 4.83 Lac during the year.
6.1.4. Small and Medium Enterprises (SMEs)
Banks exposure to Small Enterprises sector reached at Rs.15844.45
crore at the end of March 2011 with an increase of Rs. 4975.64 crore
(Y-o-Y growth 45.78%) over Rs. 10868.81 crores as on March 2010.
Further, SME advances increased by Rs. 5098.97 crore to Rs. 17670.27
crore registering a growth of 40.56% against the stipulation of 20%.
The Tiny/ Micro sector advances increased by Rs. 1750.72 crore to
Rs.5116.95 crore posting a growth of 52.01 %.
Bank has a MOU with NSIC for outsourcing credit proposals. The Bank has
a tie-up arrangement with SME Rating Agency of India Ltd. (SMERA) for
providing comprehensive rating services of SMEs borrowers of the Bank
at subsidized rates.
6.1.5. Oriental Green Card (Kisan Credit Card) & Oriental Kisan Gold
Card (OKGC)
During the Financial Year 2010-11, Bank has issued 1,02,206 cards to
farmers to meet their credit requirement for crop production, repairing
of agricultural machinery & equipment, working capital for allied
activities, to repay their old debts taken from non institutional money
lenders and consumption needs. The total amount of loan disbursed
through kisan credit cards during the year was Rs.2089.69 crore. At the
end of financial year 2010- 11, the total number of cards issued to
farmers rose to 754734.
6.1.6. Oriental Bank Grameen Project (OBGP)
Bank is providing finance to rural poor under home grown model of micro
finance viz. Oriental Bank Grameen Project. It is being implemented
through Joint Liability Group concept consisting of 5 members in each
group, preferably women. The Bank has formed 3327 Groups reaching out
to 16136 poor families spread across 256 villages in the states of
Pubjab, Haryana, Rajasthan, Uttar Pradesh and Uttarakhand. The
cumulative amount advanced to these groups as at the end of March 2011
was Rs. 30.88 crore. Savings to the tune of Rs. 8.76 crore have been
mobilized by the groups.
6.1.7. Advances to Weaker Sections
Advances to weaker sections, consist of beneficiaries belonging to
scheduled castes/scheduled tribes/small and marginal farmers/ landless
labourers/rural artisans/minority community/ beneficiaries under Govt.
Sponsored schemes (except PMEGP) reached to Rs. 6221.02 crore as a the
end of March 2011 as against Rs. 4131.25 crore as at the end of March
2010 registering growth of 50.58%.
6.1.8. Credit under Differential Rate of Interest Scheme Credit flow at
concessional rate of interest of 4% p.a. to the low- income group of
the society both in rural having annual family income upto Rs. 18,000/-
and urban having annual family income upto Rs. 24,000/- centres was Rs.
73.52 crore as at the end of March 2011.
6.1.9. Loans to SCs/STs
Bank continues its thrust in providing financial assistance to SCs/STs
beneficiaries. The advances to these beneficiaries improved to
Rs.530.66 crore in March 2011 against Rs. 421.03 crore as at the end of
March 2010.
6.1.10. Prime Minister Employment Generation Programme (PMEGP)
The Scheme has been implemented by the Government of India by merging
the two existing schemes viz. PMRY and REGP w.e.f. 1M April 2008. The
scheme aims for generation of( employment opportunities through
establishment of micro enterprises in rural as well as urban areas. The
bank has sanctioned credit assistance to the tune to Rs.75.47 crores to
1260 applicants under the scheme during the year 2010-11 against
allocated target of benefiting 1497 persons.
6.1.11. Swaran Jyanti Shahri RojgarYojana (SJSRY)
For providing gainful employment to urban poor (living below the urban
poverty line) through setting up self employment ventures, bank is
providing financial assistance under the scheme since its inception.
The bank sanctioned to 2339 beneficiaries to the tune of Rs.12.18
crores during 2010-11.
6.1.12. Swarn Jyanti Gram SwarojgarYojana (SGSY)
The scheme is operative in rural areas of the country and cover the
aspects of self employment such as organization of rural poor into Self
Help Group (SHGs) training credit technology, infrastructure and
marketing. The bank is participating in the schemes. During 2010-11
bank sanctioned financial assistance to 2015 swarojgaries to the tune
of 16.69 crore.
6.1.13. Credit Flow to Women Beneficiaries
Women are assuming greater responsibilities and playing an active role
in the economic growth of the nation but remain under represented while
receiving the credit delivery from the Financial Institutions of the
country. So for strengthening of credit flow to women, Bank has
implemented 13-points action plan as advised by the Government of
India. Bank has designated 10 branches as specialized branches for
women entrepreneurs. A number of credit schemes, such as Oriental
Mahila Vikas Yojana, Loan scheme for Professional & Self Employed
Women, Loan scheme for Beauty Parlour/ Boutiques/ Saloons/ Tailoring,
Scheme for Financing Working Women, Oriental Swaran Yojana etc. are
designed by the bank especially for women. Besides, a special project
called Oriental Bank Grameen Project (OBGP) provides all types of
banking assistance to the rural poor women.
As a result the Banks advance to women increased by Rs.632.29 crore
from Rs. 3646.69 crore as on March 2010 to Rs. 4278.98 crore as on
March 2011 registering a growth of 17.33%. Banks advances to women
beneficiaries as on March 2011 was 5.12% of ANBC against the required
stipulation of 5%.
6.1.14. Financial Inclusion
With a view to provide banking facilities to the sections of society so
far deprived from the formal financial sector, Bank has rolled out
Financial Inclusion Plan in 300 allotted villages with population more
than 2,000 through Business Correspondent model. Bank is providing
services to people in these villages at their doorsteps using biometric
cards and hand held devices (POS).
In these 300 villages 77,940 Financial Inclusion Plan (FIP) customers
have been enrolled for issuance of Bio-metric card; out of which 25,823
customers have been issued activated Bio-metric card for extending
banking services.
Further, Bank is also implementing project of distribution of Social
Welfare scheme funds in 6 districts namely Amritsar, Muktsar, Gurdaspur
(Punjab), Sriganganagar, Hanumangarh (Rajasthan) and Jind (Haryana). A
total number of 1,66,146 beneficiaries have been issued Bio-metric
cards/ Smart cards for distribution of benefits of Social Welfare
schemes under Urban Financial inclusion bank has issued 1158 biometric
cards to Kalkaji Agri Mandi labourers.
6.1.15. Lead Bank Responsibility
Bank is performing the functions of Lead Bank in three Districts namely
Ferozpur in Punjab, Sriganganagar in Rajasthan and Palwal in Haryana.
6.1.16.0BC Rural Development Trust
Bank has set up a special purpose vehicle in the name of Oriental Bank
Rural Development Trust (OBCRDT) for setting up Training Centres at
various places across the country for imparting training for capacity
building in rural areas. The Trust came into being on the 9th December
2005 as a registered body.
The main objective of the Trust is to establish training
colleges/institutes and workshops for providing training for farmers on
modern techniques of farming, tractor/farm machinery repair &
maintenance and other aspects of agriculture/rural development; micro
finance and capacity building of the rural youth and women.
Presently four OBCRSETIs (OBC Rural Self Employment Training
Institutes) are functional at Dehradun, Sriganganagar, Jaipur and
Ferozepur.
We have been allotted land by the State Government in Chomu (Jaipur),
Rajasthan and Zira (Ferozepur), Punjab. The RSETI building at Chomu was
inaugurated in the hands of Shri. Namo Narain Meena Honble Union
Minister of State for Finance on 30.03.2011. Construction work is also
in full swing at Zira (Ferozepur). Govt of India has sanctioned an
amount of Rs. 2 crores for constructions of two centres. Trust is also
in the process of setting up training centre in the Palwal district of
Haryana.
During the Financial Year 2010-11, a total of 177 training programmes
were conducted and 5379 candidates were given training. Of these 50
were entrepreneurship development programmes on subjects like tailoring
& dress designing, watershed management, phulkari embroidery, milch
animal rearing, crop production, beauty parlour, medicinal plantation,
etc which benefitted 1325 candidates. A total of 457 trained persons
were credit linked for pursuing/setting up of economic activities.
Emphasis is also given to train candidates from BPL strata of the
society for which list of candidates is obtained by the centres from
respective DRDA. Cumulatively these centres have conducted 588 training
programmes since inception benefiting 20586 candidates.
6.1.17. Financial Literacy & Credit Counselling (FLCC)
Bank has established 2 FLCC centers in District Karnal and Palwal in
the state of Haryana. These centres are being manned by counselors who
provide preventive and curative debt counselling within the district.
As on March 2011, 795 persons benefitted from the FLCC. Further 5
seminars on preventive debt counselling were conducted.
6.2. Retail Credit
Retail Credit segment continues to be the Thrust area of lending. The
Bank is having 10 Retail Credit Scheme including Home loans to meet the
requirements of various sections of the society. Our Retail Credit
Schemes are customer friendly, competitive and specifically designed to
suit all sections of the society. The Bank has been formulating
customized schemes and is also having tie- ups with various reputed
builders and auto manufacturers to boost its Retail segment.
6.3. Education Loan
The education loan portfolio of the Bank stood at Rs. 1102.44 crore as
on 31.03.11 and showed Y.O.Y. Growth of 13.45%. Bank continued its
efforts for extending education loans to students on soft terms &
conditions and competitive rates besides 0.50% concessions in rate of
interest is being given to girl students. During the admission season,
education loan camps were organized in the campus of the educational
institutions.
7. TREASURY OPERATIONS:
The G-Sec yields hardened across the curve owing to stubbornly higher
inflation and tighter system liquidity. During the FY 2010-11, RBI
raised Repo rates by 175 bps and Reverse Repo by 225 bps in a
calibrated manner to reign in inflation and prevent inflationary
pressure building in the economy. The Equity market remained positive
on account of global economic recovery and strong growth reported by
domestic companies. The secondary market turnover has been Rs.
85,626.03 crore in FY 2010-11.The net profit in the secondary market
operations has been Rs. 78.06 crores during the FY 2010-11. During the
FY 2010-11 Bank has shifted government securities having book value Rs.
1720.17 crores from Available for sale(AFS) category to Held to
Maturity (HTM) category, and shifted securities having book value Rs
962.34 crores from Held to Maturity (HTM) to Available for Sale (AFS)
category, and in the process booked depreciation of Rs. 64.05 crores.
The aggregate investments of the Bank have increased to Rs 42,153.04
crores in FY 2010-11 from Rs 35785.32 crores last year, an increase of
17.8%. The yield on investments has increased to 7.21% from 7.08% last
year owing to rise in the yield of Fixed income securities in the
investment portfolio.
8. MERCHANT BANKING ACTIVITIES:
The Bank has been registered as Depository Participant with both NSDL &
CSDL. More than 76,000 customers are availing the demat services of the
Bank and PAN non-complaint zero balance accounts have been closed as
per SEBI directive. The number of branches offering demat services has
gone up to 307 during the year 2010-11. The Bank is also offering
online trading services in collaboration with IDBI Capital Market
Services Ltd. for its customers.
During the fiscal year, the Bank raised Tier I Capital through issue of
Innovative Perpetual Debt Instrument aggregating Rs.300 crore on
private placement basis at the coupon of 9.05% p.a with a step up of 50
bps after 10 years in case the call option is not exercised. The Bonds
were allotted to 23 subscribers on 17.09.2010.
During the fiscal year, the Bank also raised Tier II Capital through
issue of Unsecured Redeemable Non-Convertible Subordinated Upper
Tier-ll Bonds aggregating Rs.200 crore on private placement basis at
the coupon of 8.68% p.a with a step up of 50 bps after 10 years in case
the call option is not exercised. The Bonds were allotted to 6
subscribers on 20.09.2010. 8.1 Applications supported by Blocked
Amount (ASBA) Our Bank has been registered with SEBI as Self Certified
Syndicate Bank (SCSB) for providing Applications Supported by Blocked
Amount (ASBA) facility to its customers. ASBA is an application
containing an authorisation to block the application money in the bank
account maintained with SCSB. Under the ASBA facility, the application
amount for subscribing to an issue (IPO/Rights issue), remains in the
bank account of the customer till allotment is finalized and actual
amount equal to allotted shares is only debited instead of total
application amount. The Bank is providing ASBA offline facility
through 552 authorized branches across the country. Online ASBA
facility has also been started in March 2011 for internet banking
customers.
9. FOREIGN EXCHANGE BUSINESS
During the fiscal year 2010-11, Forex turnover increased to Rs.66912.60
Crore as on 31.03.2011 as against Rs.49924 Crore as on 31.03.2010, thus
registering a growth of 34.02%. The export credit of the bank stood at
Rs.4507 Crore as on 31.03.2011 as against Rs.3963 Crore as on
31.03.2010, thus registering a growth of 13.72%. During the year under
review, 7 more branches were authorized to conduct foreign exchange
business taking up such authorized branches to 94. The tie ups with
exchange houses for Draft and Speed drawing arrangement has further
increased from existing 2 to 6, which facilitates in garnering more &
more NRI accounts and increase in remittance business. The total
earning from foreign exchange business also registered a substantial
increase from Rs.162.43 Crore for the year ended 31.3.2010 to Rs.225.63
crore for the current financial year, registering a growth of 38.90 %
over the preceding financial year. The bank has mobilized non resident
deposits to the tune of Rs.1755 Crore as on 31.03.2011. The operations
at Representative Office at Dubai has completed its two years of
operations, acting as catalyst to canvass non-resident accounts of
Indian expatriates in UAE to expand the Non resident customer base of
the bank. The fee-based products like Western Union Money Transfer have
also shown growth during the preceding financial year.
Bank also started selling the gold coins w.e.f. 30.10.2010 i.e. on the
auspicious occasion of Dhanteras / Deepawali. Presently the Gold coins
of different denominations are being sold from 68 locations spread all
over India. This has supplemented the banks non-interest income.
During the short span of 6 months bank earned Rs0.37 crore on sale of
gold coins.
10. THIRD PARTY PRODUCTS:
10.1 Life Insurance Business (JV):
During April 2010 - March 2011 the Bank sold 42393 policies with First
Premium Collection of Rs. 159.20 Crores and has earned commission of
Rs. 35.56 Crores (Gross).
10.2 General Insurance Business:
Under General Insurance Business the Bank has been registering steady
growth and has collected around Rs. 24.45 Crores as Premium collections
and income by way of Commission at Rs. 3.09 Crores.
10.3 Mutual Fund Business:
The Bank has been selling the Mutual Fund products of the 6 Mutual Fund
Houses. During the Financial year 2010-11 the Bank has sold Mutual Fund
products and collected AUM of Rs. 62.14 Crores and earned income of Rs.
31.07 Lacs under this segment.
10.4 New Pension Scheme (NPS):
Pension Fund Regulatory and Development Authority (PFRDA) has appointed
the Bank as Points of Presence (POP) w.e.f. 01.05.2009 for the purpose
of subscribing to New Pension Scheme (NPS) for all citizen of India.
Total 251 branches have been selected to act as POP-SPs.
10.5 Demat Accounts:
The Bank is a Depository Participant for both NSDL and CDSL. It has
more than 76,000 accounts under this category of Business and has
recorded a revenue generation of Rs.4.34 Crores in this Financial year
2010-11. The Bank has tied up with the IDBI Capital Market Services
Ltd., and providing Online Trading facilities to its DEMAT Account
holders through 289 identified Branches.
10.6 Gold Coins:
The Retail sale of Gold Coins in different denominations (5 grams, 8
grams & 10 grams) was launched on 30.10.2010 through 83 branches in 12
Regions. 5937 Gold Coins have been sold during the financial year
2010-11.
10.7 UID Cards:
The Bank has entered into MOU with Unique Identification Authority of
India (UIDAI) on 11.08.2010 as Registrar for issuing UID cards to its
customers base of about 1.5 Crores, staff members and other citizens
through our Branches. Approximate 66,300 UID cards got enrolled during
the financial year 2010-11
10.8 Cash Management Services (CMS):
The Bank provides an efficient and tailor-made CMS solution to suit the
customer requirements. The Bank is offering Collections, Payments and
Custodial Services to the Customers under Cash Management Services. The
Bank has coverage of more than 121 cities through own Branches and 500
Locations through Correspondent arrangements offering CMS services to
clients across the country. The Bank has registered a turnover of above
Rs. 1351.07 Crores and earned Non-Interest income of Rs.1.38 Crore
during the financial year of 2010-11.
11. BRANCH EXPANSION:
During 2010-11, the Bank has opened 84 new branches besides up
gradation of 28 extension counters. As on 31.03.2011, total number of
branches stood at 1620 as against 1508 as on 31.03.2010. The population
group-wise classification of branches as at end-March 2011 is as under:
S.N. Classification 31.03.2011 31.03.2010
1 Rural 334 306
2 Semi-Urban 423 373
3 Urban 489 473
4 Metro 374 356
Total 1620 1508
12. CUSTOMER SERVICE:
The Banks endeavor to provide excellent customer service has been
through improving existing and innovating new services by leveraging
the advanced technology platform of the bank. The bank has introduced,
Mobile Banking (OBCmPAY), Internet Banking Services, International
Proton Debit Card, SMS Banking service, Funds transfer through ATMs
(only among accounts linked to ATM card), facility of Cheque Status
Inquiry and Stop Payment of Cheques available 24x7 on Banks ATMs,
deployment of Point of Sale (POS) Terminals at the identified
prospective Merchant Establishments, Cheque deposit machines at some of
the branches to facilitate cheque deposit with acknowledgment generated
by the machine itself, online payment of service taxes etc. to provide
efficient and effective service for delight of customers.
For better customer service the online Education Loan, OBC-e- shoppe,
OBC-e-taxes, online fee deposit, online Tax Accounting System(OLTAS)
are some of the popular online products which the bank offers to its
customers. The Bank also offers cash management product for corporate.
Facility of speed clearing is available at selected centres. In view of
urgent needs the third party withdrawal of cash through cheques at
nonparent branches have been permitted upto certain limit, The Bank has
launched Variable Progressive Deposit Scheme called Aadhar. The bank
has services to meet the requirements of different groups like Old &
sick, physically handicapped, visually impaired etc. to meet their
needs.
The Banks codes of commitment to customers are displayed on the Banks
website for information and printed copies are available at branches
for customers information.. A dedicated Customer Care Centre on toll
free Number 1800-180-1235 has been set up for clarifying the customers
account related and other queries.
The website has a link "Query & Suggestion" for receiving customers
feedback on the services of the bank for its examination and
application wherever required. Complaint/Suggestion Boxes are provided
at branches where a customer can drop his complaint or suggestion and
the customer can also make complaints through the banks website. The
Customers are invited at customer service meetings held regularly at
Branches, Regional Offices and Head Office. The Bank emphasizes on the
updation of knowledge of the staff on the banking products and services
through continuous training to meet the requirements of the
customers.The Bank is committed to provide excellent service for the
customers maximum satisfaction and delight.
13. KNOW YOUR CUSTOMER (KYC) NORMS & ANTI-MONEY LAUNDERING (AML)
MEASURES:
To comply with the various laws and regulations, national as well as
international, Govt, of India and Reserve Bank of India directives /
instructions & guidelines, primarily to prevent the bank from being
used, intentionally or unintentionally, by criminal elements for money
laundering activities, OBC KYC Policy has been formulated. The Policy
combines four key elements viz. "Customer Acceptance Policy",
"Customer Identification Procedures", "Monitoring of Transactions" and
"Risk Management". This will enable the bank to know / understand the
customers and their financial dealings better and shall further help in
managing risks more prudently. The detailed guidelines and subsequent
instructions are being reiterated from time to time for strict
compliance by the field functionaries. The bank is already complying
with the requirement of submission of statutory returns to the FIU-IND
as a sequel to the new legislation on Prevention of Money Laundering
Act-2002. The Bank has already operationalised Anti-Money Laundering
software solution for complying with KYC Norms / AML Measures and
generation of alerts to detect any suspicious transaction. Alerts are
being scrutinized by us and STRs are being submitted to FIU-IND. Bank
is also submitting all the required data/returns relating to
KYC/AMLtothe regulatory bodies.
14. USE OF HINDI IN THE BANK:
During the year 2010-11, Bank continued its concerted efforts to
accelerate use of Hindi and to implement the guidelines/directives
received from Govt, of India and Reserve Bank of India. Concrete and
effective steps were taken to achieve the region wise targets set by
the Department of Official Language, Ministry of Home Affairs, Govt, of
India in the Annual Programme- 2010-11.
Bank was awarded Second prize in A region under Reserve Bank
Rajbhasha Shield Competition 2009-10 for Public Sector Banks /
Financial Institutions for its excellent performance in the field of
Rajbhasha Hindi. Regional Offices Delhi & New Delhi were awarded Third
Prize for doing good work in Hindi and our Banks In-House Magazine
AADHAAR was awarded Second Prize under Inter Bank Rajbhasha Shield
Competition - 2009-10 by the Banks Town Official Language
Implementation Committee, Delhi. Besides, our Regional Offices,
Ludhiana & Jaipur were awarded First Prize by Banks Town Official
Language Implementation Committees, Ludhiana & Jaipur respectively.
Drafting & Evidence Sub-Committee of the Committee of Parliament on
official Language held discussions on progress made in use of Hindi
with the Branch Incumbents of our branch offices Coimbatore & Jhansi on
13.09.2010 & 22.12.2010 respectively and appreciated the work being
done in Hindi in the Bank.
Bank continued its concerted efforts to promote use of Hindi in field
of Information Technology. To provide banking facilities to customers
in Hindi also by CBS branches, the bilingual Data Processing Software
Script Magic was installed in the branches of the Bank. To facilitate
work in Hindi in CBS environment various job cards were prepared in
Hindi and made available on OBC web portal. Bank web site was updated
in Hindi. For the convenience of the employees an English-Hindi Banking
Glossary was provided online at OBC Web Portal. Training for use of
Hindi on Computers was imparted to employees of the Bank.
Banks e-circulars and Executives messages, policies, deposit / loan
schemes, retail schemes, Power chart, Finacle menues, branch directory,
ATM list etc. were prepared and uploaded on OBC web portal.
Hindi-Fortnight was celebrated in different offices / branches of the
Bank in month of September and various Hindi competitions for staff
members were conducted. The winners were awarded certificates & prizes.
Besides, our staff members won prizes in various Inter Bank
competitions also conducted by different Banks.
All the issues of Banks quarterly In-House Magazine "AADHAAR" were
published regularly in bilingual form i.e. in Hindi and English.
15. RECOVERY:
During the Financial Year 2010-11, concerted recovery efforts continued
at all levels and consequently, the Bank could effect cash recovery of
Rs.512.72 Crore. Out of cash recovery a sum of Rs. 179.59 Crore has
been added to the Revenue of the Bank. The bank has effectively
utilized the various recovery mechanism e.g. holding recovery camps,
"Special One Time Settlement Schemes for NPAs with O/S upto Rs. 1.00
Lakh" which lasted upto 31.01.2011 and after that a New One Time
Settlement Schemes for settlement of NPA accounts with O/S upto Rs.
5.00 Lakh was floated which is valid upto 30.06.2011, Lok Adalat,
taking action under SARFAESI Act-2002 and general settlement policy of
the Bank. However, due to the impact of global recession, the NPAs of
the Bank has increased in comparison to the previous financial year
resulting in increase in Gross NPA percentage to gross advances to
Rs.1.98% against 1.74% of corresponding year.
The Bank is taking all possible steps to strengthen the recovery
mechanism to minimize the higher delinquencies.
16. HUMAN RESOURCE DEVELOPMENT & TRAINING:
The year 2010-11 witnessed the continuing effect of the economic
turmoil of the past years with the Government and Regulators balancing
the growth with inflation on the domestic front. The year also brought
into the industry new recruitees in various cadres including
specialists in Marketing, Agriculture, IT, Credit etc. There was
compelling need to train them in various aspects of Banking to help
them to settle down into their jobs with confidence and effectiveness.
The training plan for the year 2010-11 was started on the premise that
at least one training be given to each employee during the year. The
Bank was able to meet this objective to a maximum extent. The focus of
training during the year continued on the following areas:
Credit Management, Risk Management, Forex Management, Customer
Relationship Management, NPA & Recovery Management, General
Banking/Induction Programmes for newly recruited Probationary Officers
/ Specialist Officers /Clerks, Management Development Programme for
Executives, Soft Skills Development, Workshops on HRMS, CBS, SC/ST/OBC
Reservation Policy etc.
In 483 programmes 11544 employees were imparted training in the above
streams and other areas of Banking. In addition, 1441 officers were
nominated in Advanced Training Programmes in key operational and
behavioural areas in pioneering institutions like NIBM, Pune, College
of Agricultural Banking, Pune; IBA, Mumbai; MDI, Gurgaon; IDRBT,
Hyderabad; NIBSCOM, Noida etc., to quote a few. Few Senior and Top
management functionaries were deputed for overseas training for
Management Development Programmes and to give exposure to International
best practices and their impact in Indian Banking.
During the year 2010-11, the Bank recruited 292 Probationary Officers,
836 clerks, 467 Subordinate staff and 241 Specialist Officers in
different grades and streams such as Manager (IT), Marketing Managers,
Agriculture Officers etc., Further the process for recruitment of 500
Probationary Officers, 1750 Clerks and 526 Officers in the Specialist
cadre of Marketing, Credit, Forex, IT, Law, Agriculture, HRD etc is
under way. The total staff strength as on 31st March, 2011 is 16618
comprising of 8766 officers, 5527 Non-subordinates and 2671
subordinates. The Bank complied with Government guidelines in respect
of reservation in recruitment and promotion for SC/ST/OBC/PWD/
Ex-Servicemen in letter & spirit. The Bank recruited 911 SC/ST/OBC
category personnel in Officer, Clerical & Subordinate cadres during the
year. The grievances of SC/ST/OBC employees, if any, were resolved
through SC/ST and OBC Cells created at all Regional Offices and at Head
Office under the charge of Liaison Officers / Chief Liaison Officer.
The Bank also launched a Special Drive to clear the backlog of SC/ST
vacancies in promotion as per the guidelines of the Ministry of
Finance, Govt. of India and were able to fill 10 SC/ST backlog
vacancies.
BOARD OF DIRECTORS
During 2010-11,13 meetings of Board of Directors, 20 meetings of
Management Committee of Board, 10 meetings of Audit Committee of Board,
were held.
During the year, Sh.Nagesh Pydah, Chairman and Managing Director, took
charge of the Bank on 01.01.11 after the superannuation of Sh.T Y
Prabhu. Sh.V Kannan, Executive Director, joined the Board of the Bank
on 01.12.2010 after the superannuation of Sh.H Rathnakara Hegde and
Sh.B Srinivas, RBI Nominee Director appointed under Sec 9 (3) (c ) of
the Banking Companies (Acquisition and Transfer of Undertakings) Act,
1980 joinedthe BoardoftheBankon30.07.2010,asperhis notification. Sh. K
H Pandey and Sh S.S Shishodia, joined the Board of the Bank on
31.05.2010 and 21.07.2010 as Workmen Employee Director and Officer
Employee Director respectively, appointed by Government of India Under
Section 9 (3) (e) and Section 9 (3) (f) of the Banking (Acquisition and
Transfer of Undertakings) Act, 1980. DIRECTORS RESPONSIBILITY
STATEMENT The Directors confirm that, in the preparation of the Annual
Accounts for the year ended 31 st March, 2011
(a) The applicable standards have been followed along with proper
explanation relating to material departures, if any,
(b) The accounting policies framed in accordance with the guidelines of
the Reserve Bank of India, were consistently applied,
(c) reasonable and prudent judgment and estimates were made so as to
give true and fair view of the state of affairs of the Bank at the end
of financial year and of the profits of the Bank for the year ended on
31st March, 2011,
(d) proper and sufficient care was taken for the maintenance of
adequate accounting records in accordance with and provisions of
applicable laws governing banks in India and the accounts have been
prepared on a going concern basis.
ACKNOWLEDGEMENTS
The Board of Directors thanks Government of India, Ministry of Finance,
Department of Economic Affairs and Reserve Bank of India and other
Governments & Regulatory Agencies for their valuable guidance and
continued support provided to the Bank through out the year. The Board
of Directors are also grateful to the valued customers, esteemed
shareholders, stakeholders and public at large for their patronage and
confidence reposed in the Bank. The Board of Directors place on record
their great appreciation of the commitment, sense of involvement and
dedication exhibited by each staff member in the overall development,
growth and prosperity of the Bank and look forward to their continued
support and whole-hearted co-operation for realization of the corporate
goals in the year ahead.
For and on behalf of the Board
New Delhi (Nagesh Pydah)
29th April 2011 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2010
The Board of Directors have pleasure in presenting this Annual Report
together with the Audited Balance Sheet and Profit & Loss Account of
the Bank for the Year ended 31 st March, 2010.
1. BUSINESS OPERATIONS
The Business of the Bank crossed Rs. 200000 crore mark and stood at Rs.
204442 crore on March 31st 2010 as against Rs. 167434 crores in the
previous year. Total deposits of the Bank stood at Rs. 120258 crore and
has shown an increase of Rs. 21889 crore depicting a growth of 22.25%.
Cost of deposit stood at 6.57%. The Bank has taken conscious decision
of shedding high cost bulk deposits and substituting the same with
normal rate and lower cost deposits so as to contain the level of bulk
deposits. The percentage of bulk deposits has declined marginally from
21.42% as on 31.03.2009 to 21.37% as on 31.03.2010. On the other hand,
net advances as at end-March 2010 stood at Rs. 83489 crore, registering
a growth of Rs. 21.88%. During the fiscal 2009-10, yield on advances
has declined to 10.20% from previous years level of 10.82%. The
measures taken up by the bank to improve yield on advances through
lending to SME, Mid Corporate and Retail sector besides implementation
of Base Rate would enable the bank to improve yield on advances.
The credit deposit ratio of the Bank, as at end-March 2010, stood at
70.22% . The Bank ensured adequate flow of credit to the productive
sectors of the economy. The Loans & Advances portfolio of the bank is
well diversified and balanced. The Bank has ensured that its exposure
to sensitive sectors such as Capital Markets, Real Estate, NBFCs etc.
is well within the regulatory & prudential cap.
2. CAPITAL & RESERVES
During the year, the bank transferred a sum of Rs. 868.19 crore to
Reserves (which includes Rs. 284.00 crore transferred to Statutory
Reserves, Rs. 411.00 crore to Revenue and other Reserves, Rs. 173.19
crs. to Capital Reserves) out of the profit for the year 2009-10. With
this, capital & reserves as on March 31, 2010 have gone upto Rs.8237.95
crore as against Rs. 7403.45 crore as at end March 2009 and the ratio
of Capital & Reserves to average working funds stood at 6.61% as on
31.03.2010 as against 7.17% as on 31st March 2009.
3. CAPITAL ADEQUACY RATIO
As on March 31. 2010 the Capital Adequacy Ratio of the Bank under Basel
-II stood at 12.54% as against 12.98% as on 31st March, 2009(under
Basel-H). This is well above the regulatory minimum requirement of
9.0%.
4. FINANCIAL PERFORMANCE
The Bank has posted a total income of Rs. 11457.17 crore during the
year as against Rs. 9927.79 crore last year thus registering an
increase of Rs. 1529.38 crore (a growth of 15.41%) during the fiscal
2009-10. Operating Profit of the Bank went upto Rs. 2421.50 crore as
against Rs. 1669.98 crore last year showing a growth of 45.00%. The
Bank has made a net profit of Rs. 1134.68 crore, after making all
requisite provisions showing an increase of Rs. 244.26 crore (growth of
27.43%) during the fiscal 2009-10.
Appropriation from the Net Profit have been effected as per table given
below:-
Table : Financial Performance
(Rupees in crore)
31.03.2010 31.03.2009
Interest Income 10257.13 8856.47
Other Income 1200.04 1071.32
Total Income 11457.17 9927.79
Interest Paid 7349.69 6859.97
Operating Expenses 1685.98 1397.84
Total Expenses 9035.67 8257.81
Operating Profit 2421.50 1669.98
Provisions & Contingencies 1286.82 779.56
Net Profit 1134.68 890.42
Add-Profit brought forward 0.83 0.51
Less-Amalgamation adjustment
Written-off
Net Profit available for
appropriation 1135.51 890.93
APPROPRIATION
Transfer to Statutory reserve 284.00 227.00
Transfer to Revenue and
Other reserves 351.00 21.00
Transfer to Special Reserve u/s 60.00 86.00
36(1) (viii)of I-T Act
Transfer to capital reserve 173.19 342.12
Proposed Dividend 227.99 182.90
Tax on Dividend 38.75 31.08
Bfilance carried over to
Balance Sheet 0.58 0.83
5. DIVIDEND
Your Banks policy of declaring dividend is to reward the share holders
as well as to plough back profit for maintaining a healthy capital
adequacy ratio & for supporting future growth. Accordingly, your
Directors are pleased to propose a total dividend of 91% (i.e Rs. 9.10
per share)for the year ended 31st March, 2010 as against 73%(i.e. Rs.
7.30 per share) paid for the preceding year.
6. SECTORAL DEPLOYMENT OF CREDIT TO PRIORITY SECTOR
Banks advances to priority sector increased by Rs. 7068.54 crore from
Rs. 22315.07 crore in March 2009 to Rs. 29383.61 crore in March 2010
registering a growth of 31.68%. The Priority Sector Advances
constituted 42.90% of the Adjusted Net Bank Credit (ANBC) against the
stipulation of 40%. The comparative position of advances under various
segments under Priority Sector as at the end of March 2009 and March
2010 is as follows:
(Amount Rs. in crore)
S. No. Sectors March 2009 March 2010
1. Priority sector credit 22315.07 29383.61
2. Agriculture 8614.03 11267.51
3. Direct Agriculture 4644.43 6564.47
4. Indirect Agriculture 3969.60 4703.04
5. SSI/SE 5576.33 10868.81
6. Educational Loan 767.97 942.72
7. Housing Loan 6197.17 6258.03
8. Other P.S. 1159.57 46.54
6.1 Agriculture Advances
Banks advances to agriculture increased by Rs.2653.48 crore from
Rs.8614.03 crore in March 2009 to Rs.11267.51 crore in March 2010,
registering a growth of 30.80%. The advances to direct agriculture
segment increased by Rs. 1920.04 crore from Rs.4644.43 crore as on
31.3.2009 to Rs.6564.47 crore as on 31.3.2010 constituting a growth of
41.34%. The Indirect agriculture advances increased by Rs.733.44 crore
from Rs.3969.60 crore as on 31.3.2009 to Rs.4703.04 crore as on
31.3.2010 showing an increase of 18.48%.
6.1.1 Flow of credit to Agriculture sector (Fresh disbursement)
During the financial year 2009-10, fresh flow of credit to agriculture
sector amounted to Rs. 4937.07 crore. During the year, a total of
207517 new agriculture loan accounts were added. There was an average
addition of 305 new agriculture loan accounts per rural and semi-urban
branch.
6.1.2. Hi-Tech Dairy
The bank is providing credit to rural youths for their self employment
under Hi Tech commercial dairy scheme in Punjab & Haryana states. Under
the scheme Punjab Dairy Development Board /Animal Husbandry & Dairying
department Haryana impart one month training to unemployed youth for
their skill up gradation. As on 31.3.10, an amount of Rs. 77.32 Crore
has been sanctioned to 661 units.
6.1.3. Oriental Saur Urja Dohan Scheme
The fossil fuel resources are limited in quantity and are fast
depleting. The poor use Kerosene as common fuel for lighting. The rural
people face problem of home lighting due to non-availability of grid
electric power supply. Even if there is power supply, frequent load
shedding and low voltage is a regular phenomenon in rural areas. To
overcome these problems the bank is implementing a scheme for financing
solar water heating & lighting system, for creating a viable alternate
to conventional source of energy. The scheme is open to individual,
institutional, commercial and industrial users.
Bank is also providing loan for solar water heating system, under MNRE
scheme of IREDA. The bank finance for Solar Water Heating System
amounted to Rs.4.78 Lac under MNRE tie up arrangement and bank claimed
subsidy of Rs.0.82 Lac during the year.
6.1.4. Small and Medium Enterprises (SMEs)
Banks exposure to Small Enterprises sector stood at Rs.10868.80 crore
at the end of March 2010 and has shown an increase of Rs..5292.47
crore, recording a growth rate of 94.91%. Further, SME advances
increased by Rs. 5629.96 crore to Rs.12571.29 crore registering a
growth of 81.11% against the Year on Year growth stipulation of 20%.
The Tiny/ Micro sector advances increased by Rs. 1962.30 crore to
Rs.3366.23 crore posting a growth of 139.77%.
Bank has entered into a MOU with NSIC for outsourcing credit proposals
for lending. The Bank has entered into a tie-up arrangement with SME
Rating Agency of India Ltd. (SMERA) for providing comprehensive rating
services of SMEs borrowers of the Bank at subsidized rates.
6.1.5. Oriental Green Card (Kisan Credit Card) & Oriental Kisan Gold
Card (OKGC)
During the Financial Year 2009-10, Bank has issued 83,885 cards to
farmers to meet their credit requirement for crop production, repairing
of agricultural machinery & equipment, working capital for allied
activities, to repay their old debts taken from non institutional money
lenders and consumption needs. The total amount of loan disbursed
through these cards during the year was Rs. 1278.47 crore. At the end
of financial year 2009-10, the total number of cards issued to farmers
rose to 652528.
6.1.6. Oriental Bank Grameen Project ( OBGP )
Bank is providing finance to rural poor under home grown model of micro
finance viz. Oriental Bank Grameen Project. It is being implemented
through Joint Liability Group concept consisting of 5 members in each
group, preferably women.
The Bank has formed 3745 Groups reaching out to 17340 poor families
spread across 280 villages. The cumulative amount advanced to these
groups as at the end of March 2010 was Rs. 28.36 crore. Savings to the
tune of Rs. 13.11 crore have been mobilized by the groups.
Bank has also participated in the Janashree Bima Yojana a social
security group insurance scheme of Life Insurance Company of India
(LIC). The JBY scheme was launched with the aim of providing life and
accidental cover to women belonging to the un-organised sector. The
scheme was launched by Bank in the month of December 2008 and as on
31.03.2010, 1706 members of 481 SHGs were covered under the scheme.
6.1.7. Advances to Weaker Sections
Advances to weaker sections, consisting of beneficiaries belonging to
scheduled castes/scheduled tribes, small and marginal farmers, landless
labourers, rural artisans, beneficiaries under Govt. Sponsored schemes
(except PMRY) were of the order of Rs. 4131.25 crore as a the end of
March 2010 as against Rs. 3018.71 crore as at the end of March 2009.
6.1.8. Credit under Differential Rate of Interest Scheme
Credit flow at concessional rate of interest of 4% p.a. to the low-
income group of the society both in rural having annual family income
upto Rs. 18,000/- and urban having annual family income upto Rs.
24,000/- centres was Rs. 90.06 crore as at the end of March 2010.
6.1.9. Loans to SCs/STs
Bank continues its thrust in providing financial assistance to SCs/ STs
beneficiaries. The advances to these beneficiaries improved to
Rs.591.22 crore in March 2010 against Rs. 483.03 crore as at the end of
March 2009.
6.1.10. Prime Minister Employment Generation Programme (PMEGP)
The Scheme has been implemented by the Government of India by merging
the two existing schemes viz. PMRY and REGP w.e.f. 1st April 2008. The
scheme aims for generation of employment opportunities through
establishment of micro enterprises in rural as well as urban areas. The
bank has provided financial assistance to the tune to Rs.62.45 crores
to 1653 applicants under the scheme during the year 2009-10.
6.1.11. Swaran Jyanti Shahri Rojgar Yojana (SJSRY)
For providing gainful employment to urban poor (living below the urban
poverty line) through setting up self employment ventures, bank is
providing financial assistance under the scheme since its inception.
The bank financed to 2244 beneficiaries to the tune of Rs.6.88 crores
during 2009-10.
6.1.12. Swarn Jyanti Gram Swarojgar Yojana (SGSY)
The scheme is operative in rural areas of the country and cover the
aspects of self employment such as organization of rural poor into Self
Help Group (SHGs) training credit technology, infrastructure and
marketing. The bank is participating in the schemes. During 2009-10
bank provided financial assistance to 3227 swarojgaries to the tune of
13.60 crore.
6.1.13. Credit Flow to Women Beneficiaries
Women are assuming greater responsibilities and playing an active role
in the economic growth of the nation but remain under represented while
receiving the credit delivery from the Financial Institutions of the
country. So for strengthening of credit flow to women, Bank has
implemented 13-points action plan as advised by the Government of
India. Bank has designated 10 branches as specialized branches for
women entrepreneurs.
A number of credit schemes, such as Oriental Mahila Vikas Yojana, Loan
scheme for Professional & Self Employed Women, Loan scheme for Beauty
Parlour/ Boutiques/ Saloons/ Tailoring, Scheme for Financing Working
Women, Oriental Swaran Yojana etc. are designed by the bank especially
for women. Besides, a special project called Oriental Bank Grameen
Project (OBGP) provides all types of banking assistance to the rural
poor women.
As a result the Banks advance to women increased by Rs. 736.15 crore
from Rs. 2920.54 crore as on March 2009 to Rs. 3646.69 crore as on
March 2010 registering a growth of 24.86%. Banks advances to women
beneficiaries as on March 2010 was 5.32% of ANBC against the required
stipulation of 5%.
6.1.14. Financial Inclusion
With a view to provide banking facilities to the sections of society so
far deprived from the formal financial sector, bank implemented
financial inclusion policy. Bank adopted three pronged strategies for
financial inclusion. First, rural branches of the bank adopted villages
for financial inclusion. Second, both Lead Districts of the bank
volunteered for 100% financial inclusion. Third, banks branches
participated in districts identified by the respective SLBCs.
Under village adoption scheme as on March, 2010, bank adopted 2162
villages having 1426240 households. Bank has achieved 100% financial
inclusion in 1958 villages covering 1130942 households and opened
6,76,476 accounts under normal deposit/ loan schemes and 2,16,663
accounts under no-frills savings scheme.
In Banks Lead District of Ferozepur, completed 100% financial
inclusion in 997 villages and 156 wards having 2,89,896 households and
opened 68747 no-frills accounts. In Sriganganagar District, Bank
completed 100% financial inclusion in 3031 villages and 231 wards
having 3,22,270 households and opened 109,552 new accounts.
Further, Bank has started project of implementing Financial Inclusion
by providing smart cards in 7 districts initially namely Muktsar,
Delhi, Sriganganagar, Ferozpur Amritsar, Gurdaspur and Dehradun. 124283
smart cards have already been issued. Further the project for
Financial Inclusion has been extended to 6 blocks in Amritsar namely
Jandiala Guru, Harsha Chhina, Verka, Chogawan, Rayya and Tarsikka.
6.1.15. Lead Bank Responsibility
Bank is performing the functions of Lead Bank in three Districts namely
Ferozpur in Punjab, Sriganganagar in Rajasthan and Palwal in Haryana.
6.1.16. OBC Rural Development Trust
Bank has set up a special purpose vehicle in the name of Oriental Bank
Rural Development Trust (OBCRDT) for setting up Training Centres at
various places across the country for imparting training for capacity
building in rural areas. The Trust came into being on the 9 December
2005 as a registered body.
The main objective of the Trust is to establish training colleges/
institutes and workshops for providing training for farmers on modern
techniques of farming, tractor/farm machinery repair & maintenance and
other aspects of agriculture/rural development; micro finance and
capacity building of the rural youth and women.
Presently four OBCRSETIs (OBC Rural Self Employment Training
Institutes) are functional at Dehradun, Sriganganagar, Jaipur and
Ferozepur.
We have been allotted land by the State Government in Chomu (Jaipur),
Rajasthan and Zira (Ferozepur), Punjab where full- fledged training
centres are being constructed and construction work has started in full
swing. Govt of India has sanctioned an amount of Rs. 2 crores for
constructions of these centres. Haryana and Uttar Pradesh are other two
states where the Trust plans to set up training centres in the near
future.
During the Financial Year 2009-10, a total of 176 training programmes
were conducted and 6694 candidates were given training on subjects like
tailoring & dress designing, watershed management, phulkari embroidery,
milch animal rearing, crop production, beauty parlour, medicinal
plantation, etc. A total of 2323 trained persons were credit linked for
pursuing/setting up of economic activities. Emphasis is also given to
train candidates from BPL strata of the society for which list of
candidates is obtained by the centres from respective DRDA.
Cumulatively these centres have conducted 411 training programmes since
inception benefiting 15214 candidates.
6.2. Retail Credit
Retail Credit segment continues to be the Thrust area of lending. The
Bank is having 10 Retail Credit Scheme including Home loans to meet the
requirements of various sections of the society. Our Retail Credit
Schemes are customer friendly, competitive and specifically designed to
suit all sections of the society. The Bank has been formulating
customized schemes and is also having tie-ups with various reputed
builders and auto manufacturers to boost its Retail segment.
6.3. Education Loan
The education loan portfolio of the Bank stood at Rs.971.75 crores as
on 31.03.10 and showed Y.O.Y. Growth of 23%. Bank continued its efforts
for extending education loans to students on soft terms & conditions
and competitive rates besides 0.50% concessions in rate of interest is
being given to girl students. During the admission season, education
loan camps were organized in the campus of the educational
institutions.
7. TREASURY OPERATIONS
The G-Sec yields hardened across the curve as the underlying market
sentiment was bearish on account of expectations of RBI reversing its
easy monetary stance due to increase in Food led Inflation. However RBI
continued its easy monetary stance during the major part of the
financial year and reversed its monetary stance from January 2010
onwards. The equity market remained positive on account of economic
recovery across the globe. Consequent upon this, turnover in the
secondary market has increased from Rs.28,526 crore in the year 2008-09
to Rs.65,312.05 crore in the year 2009-10. The net profit from the
secondary market operation was Rs.423.55 crore during the year 2009-10.
During the Financial Year 2009-10 the bank shifted Government
securities having book value of Rs.1271.48 crore from Available For
Sale (AFS) category to Held To Maturity (HTM) category and booked
depreciation of Rs.137.76 crore and shifted securities having book
value of 979.59 from HTM to AFS category ignoring the appreciation as
per RBI guidelines. The aggregate investment of the Bank increased to
Rs.35785.32 crore at the end of the financial year 2009-10 as against
Rs. 28658.39 crore in the FY 2008-09, an increase of 24.87%. The yield
on investment has decreased to 7.08% from 7.63% as compared to last
year due to maturing of high coupon securities and issuance of
securities bearing low coupon in the FY 2009-10. Valuation of HFT & AFS
portfolio is done on daily & quarterly basis respectively and
depreciation, if any, is booked on quarterly basis.
8. MERCHANT BANKING ACTIVITIES:
The Bank has been registered as Depository Participant with both NSDL &
CSDL. Nearly 78,000 customers are availing the demat services of the
Bank and PAN non-complaint zero balance accounts have been closed as
per SEBI directive. The number of branches offering demat services has
gone up from 106 to 295 during the year 2009-10. The Bank is also
offering online trading services in collaboration with IDBI Capital
market services for its customers. During the fiscal year, the Bank
raised Tier I Capital through issue of Innovative Perpetual Debt
Instrument aggregating Rs.300 crore on private placement basis at the
coupon of 9.10% p.a with a step up of 50 bps after 10 years in case the
call option is not exercised. The Bonds were allotted to 27 subscribers
on 17.12.2009.
8.1 Applications Supported by Blocked Amount (ASBA)
The Bank has been registered with SEBI as Self Certified Syndicate Bank
(SCSB) for providing Applications Supported by Blocked Amount (ASBA)
facility to its customers. ASBA is an application containing an
authorisation to block the application money in the bank account
maintained with SCSB. Under the ASBA facility, the application amount
for subscribing to an issue (IPO/Right issue), remains in the bank
account of the customer till allotment is finalized and actual amount
equal to allotted shares is only debited instead of total application
amount.
9. FOREIGN EXCHANGE BUSINESS
The financial year 2009-10 has witnessed remarkable turnaround in
domestic as well as overseas market activities. The impact of global
meltdown started fading away in the beginning of financial year due to
various steps taken by Government. Industrial activities also got
revived in the international market and global demand was also
strengthened giving support to exports from our country. Our country
was almost untouched by subprime crisis thankfully due to prudent
actions taken by Government and RBI. The performance of our bank on
forex front may be seen as synchronized with revival of business
activities in domestic and overseas market. During the fiscal year
2009-10, Forex turnover increased to Rs.49924 Crores as on 31.03.2010
as against Rs.42500 Crore as on 31.03.2009, thus registering a growth
of 13.60%. The non-interest income from forex operations also
registered a growth of 21.51 % over the preceding financial year. The
impact of global meltdown which affected the growth of export during
the year 2008-09, had however been reversed during the financial year
under review. The export credit of the bank stood at Rs.3963 Crores as
on 31.03.2010 as against Rs.3283 Crores as on 31.03.2009, thus
registering a growth of 20.71%. During the year under review, 4 more
branches were authorized to conduct foreign exchange business .taking
up such authorized branches to 87. Bank has also identified 37 branches
for NRI business to augment NRI deposit base. Bank is in the process of
revamping the International Banking Division at Head Office so that our
Banks share in foreign exchange business reaches the desired level.
Bank has also launched speed remittance facility for NRIs in
association with three exchange houses. We are also expanding exchange
House remittance tie-ups to garner more & more NRI accounts. The bank
has mobilized non resident deposits to the tune of Rs. 1665 Crores as
on 31.03.2010. The operations at Representative Office at Dubai have
also stabilized and it is expected that our non resident portfolio may
get boost by marketing non-resident accounts of Indian expatriates at
Dubai by our Representative Office. The fee-based products like Western
Union Money Transfer have also shown growth during the preceding
financial year. Bank has also rationalised the Nostra accounts,
reducing from 24 to 17 for better management of funds in Nostra
accounts. The balances in the mirror accounts & forward position are
revalued at FEDAI rate at every month end.
10. THIRD PARTY PRODUCTS
10.1 Life Insurance Business
During April 2009- March 2010 the Bank sold 38097 policies with First
Premium Collection of Rs. 121.60 Crores and has earned commission of
Rs. 37.10 Crores.
10.2 General Insurance Business
Under General Insurance Business the Bank has been registering steady
growth and has collected around Rs. 22.00 Crores as Premium collections
and income by way of Commission Of Rs. 2.77 Crores.
10.3 Mutual Fund Business
The Bank has been selling the Mutual Fund products of 4 Mutual Fund
Houses. During the Financial Year 2009-10 the Bank has sold Mutual Fund
Products and collected AUM of Rs. 10.00 crores and earned income of Rs.
18 Lacs under this segment.
10.4 Demat Accounts
The Bank is a depository participant for both NSDL and CDSL. It has
more than 78000 accounts under this category of business and has
recorded a revenue generation of Rs. 3.47 crores in the Financial Year
2009-10. The Bank has tied up with the IDBI Capital Market Services
Ltd. for providing Online Trading facilities to its DEMAT Account
holders through 276 identified Branches.
10.5 Cash Management
The Bank provides an efficient and tailor-made CMS solution to suit the
customer requirements. The Bank is offering Collections, Payments and
Custodial Services to the Customers under the Cash Management Services.
The Bank has coverage of 117 cities through its own Branches and 500
Locations through Correspondent arrangements offering CMS services to
clients across the country. The Bank has registered a turnover of above
Rs. 858 Crore and earned non-interest income of Rs. 0.97 Crore during
the financial year of 2009-10.
11. BRANCH EXPANSION
During 2009-10, the Bank has opened 93 new branches besides up
gradation of 14 Extension Counters. As on 31/03/2010, the total number
of branches stood at 1508 as against 1401 as on 31/03/2009. The
population group-wise classification of branches as at end- March, 2010
is as under:
Sr.No. Classification 31.03.2010 31.03.2009
1. Rural 306 282
2. Semi-urban 373 341
3. Urban 473 443
4. Metropolitan 356 335
Total 1508 1401
12. CUSTOMER SERVICE
The Bank in its endeavor to achieve excellence in customer service has
started many customer friendly services viz. Mobile Banking (OBCmPAY)
besides Internet Banking Services both for individuals and corporates,
SMS alert service, Cheque/Cash deposit facility through some of the
Banks ATMs. Funds transfer through ATMs (only among accounts linked to
a ATM card), facility of Cheque Status Inquiry and Stop cheque payment
available 24x7 on Banks ATMs, deployment of Point of Sale (POS)
Terminals at the identified prospective Merchant Establishments, Cheque
deposit machines at some of the branches to facilitate cheque deposit
with acknowledgment generated by the machine itself, online payment of
service taxes etc. These services are helpful for the customers to get
their transactions done speedily and easily. For Senior Citizens
customers there is provision for separate queue in the branches. In
Saving Bank accounts the interest is now being provided on daily
products basis with effect from 1.4.2010.
The Bank has adopted and implemented voluntary codes of BCSBI for
individual customers , Fair Practice code for lenders, Micro and Small
Enterprise (MSEs) code to provide fair , transparent and quality
service to all the customers and to provide greatest satisfaction to
the customers. The codes are displayed on the Banks website for
information and printed copies are also available at branches for
customers information. The updated information on Banks Deposit
Schemes, Loan Schemes, Citizens Charter, Banking Ombudsman, SSI
Charter, Forex Remittances, Service Charges and Banks Policies viz
Financial Inclusion Policy, Cheque Collection and Compensation Policy,
Grievance Redressal Policy, Policy on Collection of dues & Repossession
of Security etc. have been displayed in Public domain of Banks
website. These are also available at branches in booklet/pamphlet form.
"Query & Suggestion" link is provided on website to get feedback from
customers. Complaint/Suggestion Boxes are provided at branches where a
customer can drop his/her complaint or suggestion.
Web-based Customer Grievance Redressal system is provided for prompt
redressal of customers grievances. Adedicated Customer Care Centre on
toll free Number 1800-180-1235 has been set up for clarifying the
customers account related and other queries.
The Customer Service Meetings are being held regularly at Branch level,
Regional Office level and Head Office level. These meetings ensure the
proper implementation of guidelines issued by regulatory authorities.
The customers are invited to attend these meetings and give their
valuable suggestion/feedback on banks services and schemes. The Bank
is committed to give excellent customer service for the customers
maximum satisfaction.
13. KNOW YOUR CUSTOMER (KYC) NORMS AND ANTI- MONEY LAUNDERING (AML)
MEASURES
To comply with the various laws and regulations, national as well as
international, Govt of India and Reserve Bank of India directives /
instructions & guidelines, primarily to prevent the Bank from being
used, intentionally or unintentionally, by criminal elements for money
laundering activities, KYC Policy has been formulated. The Policy
combines four key elements viz. "Customer Acceptance Policy", "Customer
Identification Procedures", "Monitoring of
Transactions" and "Risk Management". This will enable the Bank to know
/ understand the customers and their financial dealings better and
shall further help in managing risks more prudently. The detailed
guidelines and subsequent instructions are being reiterated from time
to time for strict compliance by field functionaries. The Bank is
already complying with the requirement of submission of statutory
returns to the Financial Intelligence Unit - India (FIU - IND) as a
sequel to the new legislation on prevention of Money Laundering Act -
2002. The Bank has already operationalised Anti Money Laundering
Software solution for complying with KYC / AML norms and generation of
alerts to detect any suspicious nature transactions. The AML Cell is
scrutinizing the alerts generated by the system for detecting any
suspicious type of transaction (s) (STRs) for onward submission to
FIU-IND.
14. USE OF HINDI IN THE BANK
During the year 2009-10, Bank continued its concerted efforts to
further accelerate use of Hindi in its working and to implement the
guidelines/directives received from Govt, of India and Reserve Bank of
India. Concrete and effective steps were taken to achieve the region
wise targets set by the Department of Official Language, Ministry of
Home Affairs.Govt. of India in the Annual Programme-2009-10.
Bank was awarded Consolation prize in A region under Reserve Bank
Rajbhasha Shield Competition 2008-09 for Public Sector Banks/Financial
Institutions for its good performance in the field of Rajbhasha Hindi.
Regional Office, Delhi was awarded Second prize for doing excellent
work in Hindi for the year 2008-09 by Regional Implementation Office,
Official Language Deptt., Ministry of Home affairs, Govt, of India. The
Bank was also awarded first prize under Inter Bank Rajbhasha Shield
Competition 2008-09 by the Banks Town Official Language Implementation
Committee, Delhi. Further, our staff members won different prizes in
various Inter Bank Competition conducted by the said committee.
During the year under review, concerted efforts were made to propagate
use of Hindi on computers. Bilingual word processing software "Akruti
Office" has been loaded in the PCs installed in all the administrative
offices and the branches. The necessary training was imparted td the
staff by conducting Hindi workshops as well as other programmes at
regular intervals. Hindi Officers and IT Officers of Head Office and
regional offices were imparted Hindi Unicode Training on computers by
officials of Reserve Bank of India. To provide banking facilities to
customers in Hindi also by the CBS branches, the bilingual Data
Processing Software Script Magic was installed in the branches of the
Bank and IT Officers and Hindi Officers of the Bank were imparted
trainers- training regarding use of this software.
During the year, Hindi version of OBC web portal was launched and
e-circuiars as well as Home page and other contents were made bilingual
so that all staff members of the Bank are able to view circulars,
executives messages, policies, various job cards.deposit / loan
schemes, retail schemes, branch directory, ATM list and other contents
in Hindi on the portal. Banks website is available in bilingual form.
The option of Hindi is available on ATMs and Telebanking. IT Ready
Reckoner was made available in Hindi for the convenience of the
employees.
All the editions of Banks quarterly In-House Magazine "AADHAAR" were
published regularly in bilingual form i.e. in Hindi and English.
Quarterly In-House magazines were published by Regional Offices at
Regional Office level.
15. RECOVERY
During the Financial Year 2009-10, concerted recovery efforts continued
at all levels and consequently, the Bank could effect cash recovery of
Rs.399.34 crore. Out of cash recovery a sum of Rs. 133.09 crore has
added to the Revenue of the Bank. The bank has effectively utilized the
various recovery mechanism e.g. holding recovery camps, One Time
Settlement Schemes for MSE borrowers and Special One Time Settlement
Scheme for NPA accounts with outstanding upto Rs.1.00 lac, Lok Adalat,
provisions of SARFAESI Act and general settlement policy of the Bank.
However, due to the impact of global recession, the NPA of the Bank has
increased in comparison to the previous financial year resulting in
increase in Gross NPA percentage to gross advances to Rs.1.74% as
against 1.53% of corresponding year.
The Bank is taking all possible efforts to strengthen the recovery
mechanism to minimize the higher delinquencies.
16. HUMAN RESOURCE DEVELOPMENT & TRAINING
The year 2009 -2010 has been the year of challenges for the Banking
industry. The Indian Banking adapted to the changed Banking scenario
admirably and helped in renewing the confidence levels and confirming
resilience in our financial system. The changed economic environment
has necessitated up-gradation of skill sets. The Bank has endeavored to
match these requirements through extensive process of training. The
focus of training during the year was on the following areas:-
Credit Management, Risk Management, Forex Management. Lending
Strategies to SMEs, Soft Skills Development, Marketing of Banks
Products, Induction Programmes for newly recruited officials, General
Banking in CBS, IT enabled Products, Treasury Management, Risk Ratings,
Management Development Programmes for Executives, SC/ST/OBC Reservation
policy, Human Resources Management System etc.,
In 394 programmes 9325 employees were imparted training in the above
streams and other areas of Banking. In addition, 1337 officers were
nominated in Advanced Training Programmes in key operational and
behavioral areas in pioneering institutions like NIBM Pune, College of
Agriculture Banking Pune, Indian Banks Association, MDI, Gurgaon,
Indian Institute of Management, Ahmedabad, Administrative Staff College
of India, Hyderabad, NIBSCOM, Noida etc., to quote a few. Few senior
and top management functionaries were deputed for overseas training to
give exposure to international best practices and their impact in
Indian Banking.
During the year 2009-10, the Bank recruited 221 Probationary Officers,
812 Clerks and 243 Specialist Officers in different grades and streams
such as Manager (IT), Marketing Managers, Agriculture Officers etc.,
Further the process for recruitment of 313 Probationary Officers, 916
Clerks and 373 officers in the Specialist cadre of Marketing,
Agriculture, IT, Security, Forex, Law, HRD etc., is under way. The
total staff strength as on 31st March 2010 is 15358 comprising of 7989
officers, 4799 Non-subordinates and 2570 subordinates.
The Bank complied with Government guidelines in respect of reservation
in recruitment and promotion for SC/ST/OBC/PWD/ Ex-servicemen besides
extending concessions/relaxation as prescribed. The grievances of
SC/ST/OBC employees, if any, were resolved through SC/ST and OBC cells
created at all Regional Offices and at Head Office under the charge of
Liaison Officers/ Chief Liaison Officer. The Bank also launched a
Special Drive to fill up the backlog of SC/ST vacancies in promotion as
per the guidelines of the Ministry of Finance, Govt, of India.
BOARD OF DIRECTORS
During 2009-2010,12 meetings of Board of Directors, 20 meetings of
Management Committee of Board & 6 meetings of Audit Committee of Board
were held.
During the year, Sh.T.Y Prabhu, Chairman and Managing Director, took
charge of the Bank on 27.08.09 after the elevation of Sh.Alok K Misra
to the post of Chairman and Managing Director of Bank of India. Two
Directors namely Sh.V Vijay Sai Reddy & Sh.Kamal Bhushan, Directors
appointed under Sec 9 (3) (g ) & Sec 9(3)(f) of the Banking Companies
(Acquisition and Transfer of Undertakings) Act, 1980, as per their
notifications, retired from the Board of the Bank due to expiry of
their term on 13.12.09 and 22.11.09 respectively.
DIRECTORS RESPONSIBILITY STATEMENT
The Directors confirm that, in the preparation of the Annual Accounts
for the year ended 31st March, 2010
(a) the applicable standards have been followed along with proper
explanation relating to material departures, if any,
(b) the accounting policies framed in accordance with the guidelines of
the Reserve Bank of India, were consistently applied,
(c) reasonable and prudent judgment and estimates were made so as to
give true and fair view of the state of affairs of the Bank at the end
of financial year and of the profits of the Bank for the year ended on
31st March, 2010,
(d) proper and sufficient care was taken for the maintenance of
adequate accounting records in accordance with the provisions of
applicable laws governing banks in India and the accounts have been
prepared on a going concern basis.
ACKNOWLEDGEMENTS
The Board of Directors thanks Government of India, Ministry of Finance,
Department of Economic Affairs and Reserve Bank of India and other
Government & Regulatory Agencies for their valuable guidance and
continued support provided to the Bank throughout the year. The Board
of Directors are also grateful to the valued customers, esteemed
shareholders, stakeholders and public at large for their patronage and
confidence reposed in the Bank.
The Board of directors place on record their great appreciation of the
commitment, sense of involvement and dedication exhibited by each staff
member in the overall development, growth and prosperity of the Bank
and look forward to their continued support and whole-hearted
co-operation for realization of the corporate goals in the year ahead.
For and on behalf of the Board
New Delhi (T. Y. PRABHU)
29th April 2010 CHAIRMAN & MANAGING DIRECTOR
Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article