Home  »  Company  »  UCO Bank  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of UCO Bank

Mar 31, 2015

Dear Members,

The Bank firmly believes in and has consistently practiced good corporate governance which is woven around its core values of transparency, professionalism and accountability. By constantly focusing on these aspects in its day-to-day operations, the Bank strives to enhance shareholders' value. The Bank being committed to the principles of good governance, its Board of Directors has formed various committees of the Board to monitor every aspect of Bank's business. The systems and business processes of the Bank are continuously reviewed at various levels for identifying and strengthening areas of weaknesses, if any. The Directors of the Bank believe that good governance is the key to earning trust, loyalty and goodwill of clients, business associates, employees and investors and respect from the society at large.

1.2. Changes in the Board of Directors

Mr. S. Chandrasekharan served as Executive Director in the Board from 01.10.2011 to 30.06.2014.

Mr. Charan Singh has been appointed as Executive Director with effect from 10.03.2015.

Mr. B.P. Vijayendra served as RBI Nominee Director in the Board from 06.09.2012 to 22.02.2015.

Dr. Arvind Sharma has been appointed as RBI Nominee Director in the Board w.e.f.23.02.2015.

Mr. Manoj Kumar Gupta served as CA Director in the Board from 02.08.2011 to 01.08.2014.

1.3. Meetings of the Board of Directors

During the financial year 2014-15, the Bank had 14 meetings of the Board of Directors. The number of meetings of various other committees of the Board held during the year 2014-15 is given below:

Name of the Committee No.of meetings held

Management Committee of the Board 14

Audit Committee of the Board 7

Risk Management Committee 4

Shareholders' Grievance Redressal Committee 2

Share Transfer Committee 4

Special Committee for Monitoring Large Value Frauds 4

Customer Service Committee 3

Committee on HR Related Issues of the Bank 5

Nomination Committee of the Board 3

Remuneration Committee of the Board 1

IT Strategy Committee of the Board 2

Board Level Committee for Monitoring Recovery in NPA Accounts 4

Committee for Disposal of Appeal Cases 2

1.4. Statement of Directors' Responsibilities

The Directors confirm that in the preparation of the annual accounts for the year ended March 31, 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 Reserve Bank of India, were consistently applied. Reasonable and prudent judgements and estimates were made so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit of the Bank for the year ended March 31, 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 the accounts have been prepared on an on-going basis. Internal financial controls have been laid down by the bank for ensuring orderly conduct of business.

1.5. Acknowledgements

The Board of Directors places on record its deep appreciation of the contributions made to the deliberations of the Board by outgoing Directors namely, Shri S. Chandrasekharan, Shri B. P. Vijayendra and Shri Manoj Kumar Gupta. The Board would like to welcome the new Directors and looks forward to their valuable inputs towards growth of the Bank. The Directors remain thankful to the Government of India, Reserve Bank of India and other regulatory authorities for their support and valuable guidance. The Board also thanks other Financial Institutions and correspondent banks for their sincere cooperation.

The Directors express their gratitude to the loyal customers for their trust and continuous patronage of the Bank. The Board also thanks the Staff Unions/Associations and shareholders of the Bank for the support extended by them. The Directors place on record their deep appreciation of the dedication shown by each employee of the Bank due to which the Bank could achieve so many milestones.

For and on behalf of Board of Directors.

Date: May 21,2015 (Arun Kaul) Kolkata Chairman & Managing Director


Mar 31, 2014

I. PERFORMANCE OF THE BANK 2013-14:

3. UCO''S DELIVERY CHANNELS:

BRICK and MORTAR Network/ USBs / Bank on Wheels :

The Bank has a geographically well spread branch network in India and abroad. The Bank has 10 Circle Offices, 45 Zones and 2894 branches as on 31.3.2014, which includes four overseas branches,( two each in Singapore and Hong Kong). The Bank has two Extension Counters as of March, 2014.

The Bank has strengthened its PAN-India network by opening 280 branches during the year 2013-14, which takes the total number from 2610 in March, 2013 to 2890 in March, 2014. During the year 2013-14, 33 branches in Tier-V and 70 in Tier-VI centres were opened.

March, ''10 March ''11 March ''12 March ''13 March ''14

Branch 2152 2206 2394 2614 2894

In the year 2013-14, 482 Ultra Small Branches (USBs) were opened by the Bank to enhance Financial Inclusion in the unbanked regions. The total number of Ultra Small Branches stood at 1245 as of 31st March, 2014. The Bank has 24 "UCO Bank-on-Wheels" operating in 19 Zones covering 11 states.

To have a better focus and monitoring over the performance of branches, the Bank had opened four more Zones namely, Agartala, Solan, Hooghly, and Vijayawada in the year 2013-14. It takes the total number of Zones of the Bank from 41 in March, 2013 to 45 in March, 2014.

The population category-wise break-up of branches is given be- low.

Specialized Branches :

As of March, 2014, the Bank had six Flagship Corporate branches, 15 Mid-Corporate branches, 23 Service branches, 8 Asset Management branches and one Integrated Treasury Management Branch at Mumbai. The Bank continues to have 27 Retail Loan Hubs and 12 SME Hubs as of March, 2014.

As at the end of 31st March, 2014, the Bank had 76 City Back Offices covering 911 branches.

The Bank has a customer base of 25.84 million as at 31st March, 2014, as against 22.36 million at the end of the previous fiscal registering a growth of 16 percent.

Alternative Delivery Channels:

The Bank has joined National Financial Switch (NFS) which enables customers to access more number of ATMs across the country. As on 31.3.2014, we had 2085 ATMs, out of which 1450 were onsite and 635 were offsite. Bank has issued Debit –cum – ATM card through VISA. There has been good increase in the issuance of Debit Cards. We have issued 42,52,965 Debit cum ATM cards as on 31.3.2014 as compared to 27,43,543 cards during the financial year as on March 2013. The bank is issuing Rupay cards under financial inclusion and ATM enabled Kisan Cards linked to Kisan account. Internet banking facility is available to customers for utility bill payments, air and rail ticket booking, on line shopping, inter- bank and intra-bank fund transfer etc. Bank is also providing services like balance enquiry, account statement, transaction related SMS alerts, payment of Indirect taxes, Direct taxes and many other banking services.

31 March 2013 31 March 2014 Y-o-Y increase Onsite Offsite Total Onsite Offsite Total

CAPEX 587 225 812 712 224 936 15.27%

OPEX - 137 137 - 102 102 -

CPP 263 299 412 738 309 1047 154.12%

Total 886 475 1361 1450 635 2085 53.20%

Alternative Delivery Channel (ADC) --

Debit Card

as on March 2013 March 2014 Y-o-Y increase

Debit Card 27,43,543 41,52,965 51.3%

Type INTERNET BANKING USERS REGISTERED

RETAIL Users 155652 222438 42.9%

CORPORATE Users 36500 47790 30.9%

Total e-Banking Users 192152 270228 40.6%

Number of registered users for Mobile-Banking 26628 41803 57.0%

MOBILE BANKING :

The Bank has implemented Mobile Banking services during the year 2011-12, whereby customers can take advantage of conducting their banking transactions through mobile phones. Customers through this mobile banking facility are now performing banking activities like balance enquiry, account statement, mobile recharge, intra & inter-bank funds transfer with their mobile handset using SMS/GPRS modes of connection.

4. BUSINESS PROFILE :

The global business of the Bank grew by 15.64 percent from Rs.305000 crore in 2012-13 to Rs.352697 crore in 2013-14, whereas Bank''s domestic business rose by 16.34 percent from Rs.277591 crore in 2012-13 to Rs.322958 crore in 2013-14. Global Deposits of the bank grew by 15.05 percent from Rs.173431 crore in 2012- 13 to Rs.199534 crore in 2013-14. Domestic Deposits grew by 15.37 percent from Rs.158386 crore in 2012-13 to Rs.182730 crore in 2013-14 .

The Bank''s global advances rose to Rs.153163 crore in 2013-14 from Rs.131569 crore in 2012-13 registering a growth of 16.41 percent. Domestic advances of the bank registered a growth of 17.64 percent from Rs.119205 crore in 2012-13 to Rs.140228 in 2013- 14.The global credit deposits ratio stood at 76.76 in 2013-14 as compared to 75.86 of the last year.

The overseas business of the Bank showed an increase of 8.50 percent and stood at Rs.29738 crore as on 31st March 2014. The total deposits of the overseas branches increased from Rs.15,045 crore as of March 2013 to Rs.16803 crore as of March 2014, thereby showing an increase of 11.69 percent. The overseas advances increased by Rs.571 crore and reached at Rs.12,935 crore as of 31st March, 2014 registering Y-O-Y growth of 4.62 percent.

CASA Deposits:

Domestic CASA deposits of the bank increased from Rs.55374 crore in 2012-13 to Rs.58884 crore registering a growth of 6.34 percent. Percentage of domestic CASA to domestic deposits stood at 32.14. The bank''s Saving deposits reached at Rs.33530 crore as of March 2014 compared to Rs.29680 crore, registering a growth of 12.97 percent and Current deposits stood at Rs.25353 crore as at March 2014 .

Employee''s Productivity:

Business per employee of the Bank improved from Rs.13.43 crore as at March 31, 2013 to Rs.15.28 crore as at 31st March 2014. Net Profit per employee also improved from Rs.2.72 crore as of March 31, 2013 to Rs.6.55 crore as of March, 31, 2014.

Profitability:

The Bank earned an operating Profit of Rs.4940 crore during the year 2013-14 from Rs.3357 crore during the financial year 2012-13 and recorded a growth of 47.16 percent. Net profit of the Bank rose by 144.34 percent from Rs.618 crore in 2012-13 to Rs.1511 crore in 2013-14.

Income and Expenditure:

The Bank''s total income rose by 10.43 percent from Rs.17704 crore in 2012-13 to Rs.19550 crore in 2013-14. The Bank''s interest income rose by 8.82 percent from Rs.16752 crore in 2012-13 to Rs.18230 crore in 2013-14. The non- Interest income of the Bank improved by Rs.369 crore from Rs.952 crore in 2012-13 to Rs.1321 crore in 2013- 14. The interest expenditure of the bank increased by 0.01 percent from Rs.12170 crore as at 31.3.2013 to Rs.12171 crore as at 31.3.2014. Operating expenditure of the bank increased by 12.03 percent from Rs.2177 crore as on 31st March 2013 to Rs.2439 crore as on 31st March 2014. Net Interest Income grew by 32.23 percent from Rs.4582 crore in 2012-13 to Rs.6059 crore in 2013-14.

5. CAPITAL :

Net worth of the Bank has increased to Rs.10284.89 crore during the financial year ending 2013-14 from Rs.8869.17crore. During the year. Bank has issued 262080580 Equity Share of Rs.10 each at price of Rs.77.19 amounting to Rs.262.08 crore to Government of India.

Capital Adequacy Ratio:

As per Basel III framework, the Bank''s Capital Adequacy Ratio of 12.68 percent which was higher than the regulatory requirement of 9 percent. Details of Capital Adequacy (Basel-III) are shown as under.

(in Rs. crore)

Particular 31.03.2014

CRAR(%) Amount

Tier- I 8.71 10157.22

Tier- I 3.97 4627.31

Total Capital 12.68 14784.53

Risk Weight assets - 116636.78

6. TREASURY & INVESTMENT MANAGEMENT

The Bank has been performing its Treasury & Investment Operations keeping track of the macroeconomic scenario and market developments in accordance with the regulatory guidelines issued by the Reserve Bank of India from time to time as also the Bank''s Corporate Investment Policy approved by the Board of Directors. In the changed scenario, where state of the art technology is providing cutting edge in Treasury & Risk Management, the Bank has also embarked upon a globally deployable Integrated Treasury Management Solution for an effective and efficient way to optimize resource utilization and maximize returns on investment/trading.

In order to mitigate risk and balance sheet management, the bank has gone for interest rate swap transactions. During the year 2013-14, the Bank toiled through the hostility of severe market volatility and despite all odds the bank could significantly improve the yield of its Investment portfolio.

The global investment (Gross) of the Bank during the year 2013- 14 grew by 29.19 percent from Rs.52, 515 crore as on 31.03.2013 to Rs.67,845 crore as on 31.03.2014. The domestic investment grew by 28.32 percent from Rs.51, 335 crore as on 31.03.2013 to Rs.65,875 crore as on 31.03.2014. SLR investment registered a growth of 22.30 percent during the year 2013-14 touching the level of Rs.53,017 crore compared to Rs.43,347 crore in March 2013. Non SLR investment (domestic) registered a growth of 60 percent to reach a level of Rs.12, 782 crore from Rs.7,988 crore in 2012-13, mainly on account of State Govt Bonds for DISCOMs. The yield on domestic investment improved significantly from 7.59 percent as on 31.03.2013 to 7.79 percent as on 31.03.2014. Total investment income has registered an average growth of 20.66 percent recording Rs.4,386 crore in 2013-14 compared to Rs.3635 crore in 2012-13.

EXPORT FINANCE:

With 74 ''B'' Category Branches, across India, UCO Bank is committed to actively cater to the needs of its Exporters. Export Turnover of the Bank during the Financial Year ended March, 2014 stood at Rs.33,226.97 crore which is 67.96 percent higher than previous year. Our Bank''s Export credit outstanding during 31st March, 2014 is Rs.2,519.40 crore, registering a growth of 3.78 percent over 31st March, 2013.

''UCO Bank,'' is the sole Bank to facilitate bi-lateral trade with Iran by agreeing to receive payment in INR for Iranian oil exports to India. Simultaneously, to boost exports under this Rupee Payment mechanism, ''UCO BANK'' negotiated 524 export bills amounting to Rs.6127 crore cumulative from April, 2013 to March, 2014. The Export Credit outstanding as of 31st March, 2014 on account of Iran Trade is Rs.450.45 crore.

In order to promote exports, during FY 2013-14, Bank organised around 125 exporter meet/ workshop/ seminar at important export- originating centres in the country. Bank is also catering to ECB needs of the customers.

7. SOCIAL BANKING:

Priority Sector Advances:

The Bank has been showing significant performance in lending to Priority sector over the years and has been effectively servicing to the priority sector and agriculture with its vast network of rural and semi-urban branches.

i) Priority Sector Lending:

During the year 2013-14, the Priority Sector Advance of the Bank stood at Rs.51965 crore constituting thereby 42.71 percent of Adjusted Net Bank Credit(ANBC). The Y-o-Y growth of Priority Sector advances stood at 48.63 percent.

ii) Agriculture Advances:

Total Agriculture advances of the Bank stood at Rs.16642 crore constituting 13.68 percent of ANBC. Direct Agriculture Credit stood at Rs.11166 crore constituting 9.18 percent of ANBC and Indirect Agriculture credit stood at Rs.5476 crore constituting 4.50 percent of ANBC. The Y-o-Y growth of total Agriculture Advances stood at 31.82 percent and under Direct Agriculture 11.82 percent.

iii) Micro, Small & Medium Enterprises(MSME)

Bank recognizes the important role of MSME in the economic development of the country and helping in generating employment opportunities in the country .The Bank has recorded a healthy growth in MSME Sector during 2013-14. Under Micro & Small Enterprises (MSE) Bank advance stood at Rs.26389 crore and under Micro, Small & Medium Enterprises (MSME) Rs.30828 crore as of 31st March 2014. The Y-o-Y growth of MSE Advances stood at 60.71 percent.

iv) Advances to Weaker Sections:

Advances to Weaker Section stood at Rs.14319 crore as of 31st March 2014, with percentage to ANBC being 11.77. The Y-o-Y growth of advance to Weaker Section stood at 38.66 percent.

v) Minority Community Advances:

Total Minority Community Advances of the Bank stood at Rs.7285 crore constituting 14.02 percent of Priority Sector Advances.

The Bank has two unique schemes - (1) "UCO Uthaan"-for upliftment of BPL families & (2) "UCO Samagra Gramin Vikas Yojna" – Adoption of villages for its all round development.

UCO Uthaan Scheme: Social-cum-Financial upliftment scheme for BPL families

Under the Scheme, villages having a large number of BPL families are adopted by the Bank through its nearest branch to bring the BPL families out of the clutches of poverty and bring about a holistic change in the villages. Under the scheme, a holistic development plan of the villagers is drawn up and followed for covering areas like education, financing for rural housing, formation of SHG and micro-financing, development of handicrafts and rural artisans, extending finance under DRI Scheme.

The Bank has adopted 12 villages in 4 states i.e. Odisha, Rajasthan, Uttar Pradesh & West Bengal for upliftment of BPL families under UCO Uthaan Scheme.

The Bank has conducted several financial literacy camps in these villages and has provided financial assistance particularly to BPL families to improve their livelihood, to generate more income so that they come out from Poverty line.

By these efforts, out of 2968 BPL families in these 12 villages, 1821 families have come out above Poverty Line and are earning their livelihood in a better way with the assistance provided by the Bank during last 2 years. In 3 villages all 636 BPL families have come out above Poverty Line. These uplifted families in 12 such villages are generating their income by adopting several activities like Dairy farming, Goatery, Betel leaf cultivation, vegetable growing, Cycle repairing, Shoe mending, Fruit vending, Grocery shop, Tea stall, Bidi making, Trolley plying, Mason Jobs etc. By these activities household income has increased by 20- 25 percent.

UCO Samagra Gramin Vikas Yojna : For all-round development of village.

The Bank has adopted 10 villages in 6 states i.e. Gujarat, Himachal Pradesh, Odisha, Kerala, Uttar Pradesh & West Bengal for its alround development under UCO Samagra Gramin Vikas Yojna.

In these villages, the Bank has conducted financial literacy camps to educate the villagers, extended financial support to them and has also initiated developmental activities under Corporate Social Responsibility. Under financial assistance, the Bank has given General Credit Cards (GCC) to small traders, Artisan Credit Cards (ACC) to artisans, Kisan Credit Cards (KCC) to farmers, loan to SHGs, loan for doing animal husbandry activities, loan to women & SC/ST beneficiaries. With the help of Bank loan many small traders have started their own business. Under CSR activities in these villages, the Bank has given Ceiling Fans, Water purifiers to different schools, Steel almirah, Books for school library, School uniform to school going children, installation of hand pumps for drinking water in the villages, installation of Solar street lights in the villages, construction of metallic road.

In 2 villages, out of above 10 villages, the Bank has provided doorstep banking facilities to the villagers of these unbanked villages through Mobile Van. The Van visits these 2 villages on a predetermined day and time during the week and provides all types of banking facilities to the villagers at their doorstep. There has been increase in the saving habits of the villagers due to this initiative. Through these vans, villagers are also being financially educated.

By these activities, there is an all round development in the adopted villages and the villagers are very much benefited.

Awards to Bank

- Ministry of MSME, Govt. of India awarded National Award to UCO Bank for implementation of PMEGP scheme in the North-East Zone for the year 2012-13.

- UCO Bank bagged "MSME BANKING EXCELLENCE AWARDS-2013 from CIMSME under following categories.

- Jury Award for New Initiative

- Best Branding Award

- UCO Bank received SKOCH RENAISSANCE AWARD 2013

for Development.

Ministry of Rural Development, Govt. of India awarded UCO Bank as 3rd Best Bank for nurturing the RSETI movement in the country for the year 2012-13.

UCO Bank received Global Sustainability Award from World CSR Congress under the category "Outstanding Social Impact".

8. FINANCIAL INCLUSION:

Financial inclusion plays a critically important role in poverty reduction, reducing income disparities and enhancing economic growth. If broadly defined, refers to universal access to a wide range of financial services at a reasonable cost. These include not only banking products but also other financial services such as insurance and equity products. The essence of financial inclusion is to ensure delivery of financial services which include bank accounts for savings and transactional purposes, low cost credit for productive, personal and other purposes, financial advisory services, insurance facilities etc.

Under the financial inclusion plan, bank has followed three models: i) BC Model ii) 24 Mobile vans with CBS connectivity iii) Brick and Motor branches opened in the unbanked villages. Bank has also introduced Kiosk Banking Model and it was launched on the foundation day of the bank. Kiosk banking model was developed with an intention to make financial inclusion more of a business promotive than obligatory through individual BC, individual grocery / medical / fair price shop owners / PCO operators and to engage CSC e- governance.

Under the financial inclusion bank has covered 5528 unbanked villages during the year and cumulative figure reached at 9635 villages with banking facility to the people. During the year 2013- 14, Bank has opened 14.60 lakhs of Basic Saving Bank deposits accounts and cumulatively touched at 40.23 lakhs as on 31st March 2014. The Bank has established 482 USBs during the year and total reached at 1245 as on March 2014. Bank is the pioneer in implementation of Mobile van banking for providing banking facility in the unbanked villages. It has deployed 24 Mobile Vans with Core Banking connectivity for online banking. Our Mobile vans cover 132 unbanked villages with population of 2000 and above and nearby small villages with population of less than 2000.

Direct Benefit transfer (DBT) and Direct Transfer for LPG (DBTL) :

The Bank has taken a number of steps for smooth roll out of Direct benefit Transfer in the 117 districts out of 121 districts identified for implementation of the schemes. Our branches in these districts have opened accounts of 43,429 beneficiaries.

Direct Benefit transfer for LPG (DBTL) :

Our Bank has been assigned with lead bank responsibilities in 16 districts out of 293 districts under the DBTL scheme which the Bank has implemented and monitoring the progress of implementation of the scheme by opening the account of the LPG consumer and seeding their Aadhar number in their accounts in all banks operating in these 16 districts. As our Bank is a lead bank, hence the responsibilities of our District Manager is to monitor the progress of all banks operating in the district and ensure that Aadhar number has been seeded in 12.65 lakhs of LPG consumers.

New initiatives for implementation of Financial Inclusion:

1. Financial Inclusion Gateway: Bank has Commissioned FI Gateway & Central Biometric Authentication Server to introduce interoperability of transactions through the BC Agents. This will create an avenue for the Bank to give an opportunity to the customers to transact with BCs of the Bank and BCs of other Banks.

2. Bank has developed Kiosk Banking solution named as UCO Samaveshan Sarathi with its launching on 6th January, 2014 on Bank''s foundation day as an alternative model to bring progress in Financial Inclusion in the villages allotted to the Bank. It is a Web Based Kiosk Banking Solution; a noble initiative of Bank; is a part of FI Gateway Project to open new avenue of Secure and hassle free Banking Services for the financially excluded group in the society, who are covered through our Financial Inclusion Project.

9. RETAIL BANKING

The year 2013-14 being the year of Retail Business, the Bank''s focused efforts resulted in good performance. In this direction, the Bank came out with various competitive and innovative products in both asset and liability side and also several modifications were done in existing asset products.

Retail Liability Portfolio

Under Liability portfolio, the Bank had launched special term deposit schemes to boost growth of term deposits of (Rs.5 crore) such as UCO Dhan Laxmi Scheme, UCO Century Scheme, UCO Double Century Scheme, UCO Monthly Income Scheme, UCO Triple One, which significantly added to our deposit portfolio. Department re-launched UCO Sowbhagya Scheme, a Recurring Deposit Scheme which was a great success. Bank also launched a special saving scheme for paramilitary armed forces named UCO Veer Shakti. These schemes were a huge success and contributed to the growth of the Retail Portfolio of the bank.

Schematic Retail Lending

Under Asset portfolio, the Bank had launched new loan schemes such as UCO CA scheme, UCO Top Up Home Loan Scheme, UCO Corporate Home Loan Scheme. Also, the Bank modified existing retail asset products such as UCO Home loan Scheme, UCO Pension Loan scheme, UCO Shopper loan, UCO Property Loan in line with market demand.

The Bank introduced the concept of having business facilitator in the branches to increase the retail business of the bank. UCO HOME loan scheme registered a growth of 57 percent and UCO Car loan scheme 275 percent during 2013-14.

Actuals Growth

Parameters FY13 (in Crs) FY14 (In Crs) Absolute (In Crs) Percentage (%) UCO Home 5196 8176 2980 57

UCO Car 772 2896 2124 275

UCO Gold 1805 2384 579 32

UCO EDUCATION 1141 1262 121 11

10. BANCASSURANCE

In Bancassurance – Life, Bank is the Corporate Agent of Life Insurance Corporation of India, the only Public Sector Life Insurance Company, since August 2003.

During the Financial Year 2013-14, Bank mobilized 33358 Policies and First Premium of Rs.62 crore registering a YOY growth of 21 percent.

In Group Credit Life Insurance, Bank has a group credit life insurance cover for the educational loan borrowers since July 2009 in tie-up with Kotak Mahindra Old Mutual Life Insurance Ltd. During the current Financial Year, Bank introduced other two Group Credit Life Insurance Cover Schemes for Home Loan and other Retail Loan Borrowers (UCO Cash, UCO Two Wheeler, UCO Car, UCO Doctor and UCO Properties) in tie up with the same Kotak Life Insurance.

In Banc assurance - Non-Life, Bank initially was the Corporate Agent of National Insurance Company Ltd, from September 2003 to end of April 2009. Since 30th September 2009, Bank has entered into a Corporate Agency tie-up with Reliance General Insurance Company Ltd. (RGICL) for its Non-Life Insurance Business. During this Financial Year, Bank mobilised 89503 Policies and Premium of Rs.35 crore registering a YOY growth of 10 percent. Besides, there are other three insurance products viz. (1) ''UCO Griha Raksha Policy'' to cover the House Properties/ Assets, (2) ''UCO Griha Raksha Plus'', a Home Loan Protector offering cover to the Home Loan borrowers against default in repayment of loan in the event of death/permanent total disability arising out of accident and being diagnosed for contracting any of the listed critical illness and (3) ''Reliance Healthy Family Policy'' a medi claim insurance scheme in tie up with the same RGICL.

In Mutual Fund Business, Bank continues its distributorship tie- up relation with eight Mutual Fund Houses of good repute viz. Franklin Templeton, ICICI Prudential, Kotak, Reliance, UTI, Birla Sun Life, Baroda Pioneer and SBI Mutual Fund.

11. RECOVERY:

The increasing trend of NPAs in the Banking Industry over last two-three years has become a great challenge to the banks. In our bank also Gross NPA has increased substantially during the period and as on 31.03.2013 GNPA had increased to Rs.7130 crore from Rs.4086 crore as on 31.03.2012. The increase in volume of impaired assets over previous years was due to fresh slippages during the period over its previous years on account of various reasons which include legacy angle. However, in the current FY 2013-14, the Gross NPA of the Bank has reduced to Rs.6621 crore from Rs.7130 crore in the corresponding period of previous year due to higher recovery/up-gradation during the period.

Main reason of high level of NPA is due to the global recession coupled with economic slowdown in the country. Large number of big borrowal accounts across the country have suffered slippage in the recent past due to non fulfillment of the repayment obligations in time. Besides, the bank''s earlier policy of concentration on bulk business was also one of the reasons of higher slippages.

Due to various recovery actions against the defaulting borrowers coupled with close monitoring of borrowable accounts, the quality of assets have started improving in the FY2013-14. Moreover, the Bank has changed its business model from its earlier Bulk business to Retail business for last two-three years which has likely helped in arresting higher slippages in the Bank. The result has also started forthcoming and as on 31.03.2014, GNPA ratio of the Bank is reduced to 4.32 percent from a high of 5.53 percent as on 31.12.2012 and 5.42 percent as on 31.03.2013. Consequently the NNPA ratio has also come down to 2.38 percent in the current FY 2013-14 from its 3.17 percent in the corresponding period of the last year. Maintaining Bank''s asset quality and recovery of dues are engaging the attention of top management and are being monitored practically on daily basis.

Recovery performance :

The performance of recovery & up gradation in NPA accounts during the FY 2013-14 has substantially improved over the previous years. Recovery performance in the current FY is more than double the figure of corresponding period of the last year. The robust performance of recovery in the current year is due to the various recovery measures being undertaken by the bank including assignment of impaired assets to the SCs/RCs for early resolution of the cases. During the FY 2013-14, bank assigned 133 NPA accounts to ARCs involving Rs.1869 crore as against sale of Rs.2.96 crore in 1 account in the last FY 2012-13.

(In Rs. Crores)

Particulars 31.03.2012 31.03.2013 31.03.2014

Cash Recovery 658 828 2015

Up gradation 417 673 1032

Total 1075 1501 3047

Loss assets (ML & tech w/off a/as) 83 117 295

Recovery in loss assets has a direct bearing in the profitability and Bank is attaching priority in monitoring/follow up in such accounts. There has been substantial increase in recovery in loss assets in the current FY over the previous years and Bank has created a separate vertical in Recovery department for effective monitoring of loss assets and its recovery.

Committee approach for follow up & monitoring of recovery in NPA accounts.

For the purpose of strengthening the monitoring mechanism of recovery performance, a committee approach is adopted by the Bank for different purposes.

i) Board Level Committee has been constituted in our Bank where CMD, EDs & Govt. nominee Director are members of the Committee for monitoring of recovery Performance of NPA accounts. Progress of recovery in all such NPA accounts is being monitored by this Committee periodically and report is being submitted to the Board accordingly.

ii) CMD/EDs of the Bank are personally monitoring the large NPA accounts particularly top 30 NPAs through personal meeting the borrowers at different centers or through video conferencing at our Circle Office level. This attempt has at least created a psychological pressure on them.

iii) General Manager, Recovery is visiting Circles/Zones with high concentration of NPAs to take first hand stock of situation and conducting meetings with Branch Heads, Advocates, EAs/ RAs in order to remove the bottlenecks of recovery.

iv) for effective monitoring of the NPAs, Asset Management Branches (AMBs) are in operation in various centers of the country depending upon the concentration of NPAs. The performance of AMBs is reviewed by various controlling offices at regular intervals.

Other Recovery actions initiated by the Bank for effective recovery:

Various recovery measures have been adopted by the Bank for boosting up recovery in NPA/ML accounts and to bring down the GNPA of the Bank. We enumerate our action plans as under:

- ABC analysis of NPA portfolio is done for minimizing NPAs through up-gradation and cash recovery, particularly for freshly generated NPAs wherever immediate scope of recovery is there.

- In case of viable units, Bank extends its hand holding approach towards them by way of restructuring/ reschedulement for its revival.

- Initiation of actions under SARFAESI Act immediately in case the unit is not viable after the account becomes NPA in all eligible accounts followed by taking possession and auction sale of the property(ies).

- Filing of Recovery suits in DRT/ Civil courts and identification & declaring borrowers with outstanding balance of Rs.25.00 lacs and above as ''Wilful Defaulters'' as per RBI guidelines.

- Decreed cases, where details of assets of borrowers and/or guarantors are not available, are being handed over to the detective agency for identification of their other unencumbered assets, if any.

- In deserving cases, Bank is filing application with DRTs/ Civil Courts to direct the Borrowers / Guarantors for surrender of their Passports with Passport authority especially in large NPA cases.

- Bank is filing caveat in SARFAESI cases of all big NPA accounts in apprehension of filing SA by the borrowers/guarantors to stop bank''s actions under SARFAESI act.

- Wherever needed, winding up petitions are filed for early/effective recovery.

- For effective monitoring the performance of AMBs, review meetings with Branch Heads of AMBs have been conducted at Head Office, Recovery Department in addition to regular reviews through video conferencing.

- Country wide Lok Adalat being held periodically by the Bank to boost up recovery in NPA accounts and during the FY 2013-14 recovery made through this channel is Rs.15.39 crore against recovery of Rs.9 crore during the last year. Bank also participated in the country wide National Lok Adalat held on 23.11.2013 in which recovery of Rs.5.89 crore was made.

12. CREDIT MONITORING

System based monitoring mechanism of advances has been put in place and Special Watch Reports and Reports on Overdue are generated and posted on UCO Online where from all concerned i.e., Branches, Zones and Circles can have the access to the reports so that focused monitoring for timely recovery of over dues can be effected. The frequency of generating Annexure V has been increased and now this important monitoring report is generated every week so as to know the overdue position and has been found useful for launching swift drives of recovery.

There are various monitoring tools used as obtaining of MSOD, QMR and HMR in large borrowal accounts, stock statement and conducting stock inspections for maintaining asset quality. Conducting Legal Audit, Stock Audit and Credit Audit as per extant policy guidelines has been ensured and especially Credit Audit reports are being used as one of the important tools for early warning signals.

Credit Audits are being conducted by Specialist Officers (Chartered Accountants) posted at Circle Offices /Zonal Offices and in Credit Monitoring Department, HO.

A separate vertical for monitoring of retail loans has been formed in the department with a view to prevent slippages under this segment. Bank has switched over to 100 percent system driven identification of NPAs as on 31st March 2014. More thrust has been given pertaining to branch officers meeting the borrowers for effecting timely recovery.

Department has also geared up to provide information as per the revised reporting system on large borrowal accounts with aggregate exposure of Rs.10.00 crores and above to CRILC data base maintained by RBI in order to bring about discipline among the borrowers.

13. RISK MANAGEMENT

During the financial year 2013-14, Bank has put in place a few new initiatives in the area of risk management. A new score card model for all Retail, MSE and agriculture loans up to one crore has been developed in house and implementation on pilot basis is going on in one Zone. Enhancement in our existing Rating Models for big advances has been effected and the testing of the efficiency of the new models vis-a-vis the existing models in predicting the probability of default is in progress at user level. Market Risk Management Policy has been comprehensively revised. Stress testing policy is put in place and is implemented for liquidity position under various stress scenarios. Dynamic Liquidity Statement is being prepared every month with time horizon of three months and Back Testing of Dynamic Liquidity projections has been implemented. Under operational Risk Management a separate Loss Data Management Policy is put in place.

14. REGIONAL RURAL BANKS:

There are two RRBs sponsored by our Bank. Those two are Bihar Gramin Bank having its Head Office at Begusarai (Bihar) and Paschim Banga Gramin Bank having its Head Office at Howrah (West Bengal). All RRBs taken together have a network of 519 branches as on 31st March 2014.

Recapitalisation of RRBs:

The total amount of Recapitalisation of Paschim Banga Gramin Bank as on 31.03.2014 stood at Rs.153.01 crore (Govt. of India), Rs.107.11 crore (Sponsor Bank) & Rs.45.90 crore (Govt. of West Bengal). Similarly, in Bihar Gramin Bank, it stood at Rs.107.07 crore (Govt. of India), Rs.74.95 crore (Sponsor Bank) & Rs.32.12 crore (Govt. of Bihar).

Performance of RRBs (Unaudited)

In respect of performance under key business parameters , total deposit of RRBs sponsored by the Bank stood at Rs.6245 crore as on 31.03.2014, registering growth of 14.09 percent. Total advance reached a level of Rs.3437 crore with an annual growth of 48.17 percent as of 31.03.2014. CD ratio of RRBs improved from 42.09 to 55.03 as on 31.03.2014.

The gross NPA of the RRBs stood at Rs.149 crore as on 31.03.2014 vis-à-vis Rs. 168 crore as on 31.03.2013. Gross NPA to Gross Advance reduced from 7.29 percent as on 31.03.2013 to 4.34 percent as on 31.03.2014. The net NPA ratio of the RRBs (NNPA) as on 31.03.2014 stood at 2.68 percent.

Bihar Gramin Bank has recorded a net profit of Rs.79 crore as on 31.03.2014 as compared to Rs.42.71 crore as on 31.03.2013 and Paschim Banga Gramin Bank has also reported a net profit of Rs.19 crores thereby reducing accumulated loss to Rs.98 crore as on 31.03.2014.

15. INFORMATION TECHNOLOGY

1. Biometric Authentication for CBS Application:

- Biometric authentication has been implemented in 1273 branches for logging to Finacle application. As of 31.03.2014, 9052 users of the above 1273 branches are allowed to log in to CBS application only after Bio-metric authentication.

- By April 2014, it is expected that biometric authentication would be completed in 1974 branches with 15000 users covering 96 percent of Bank''s business.

2. CBS Migration of Overseas Branches:

- Two branches in Hong Kong were successfully migrated to CBS on 4th Feb 2013.

- The Singapore Centre has been migrated to Finacle on 03/03/2014.

3. Unique Customer Identification Code (UCIC)

- Based on PAN number, Mobile number, Aadhar number & Passport number, multiple CUST ids available in the database, has been identified for merging.

Technological Upgradation During April, 2013 - March, 2014

1. Grid CTS:

Northern Grid

- NPCI has identified 21 centers from the states of Delhi, Uttar Pradesh, Uttarakhand, Bihar, Jharkhand, Jammu & Kashmir, Punjab and Rajasthan for implementation of CTS under Northern Grid. NPCI has directed bank to complete the CTS implementation in a phased manner. The Centers to be covered under the first phase are Jaipur, Amritsar, Agra and Jalandhar. Implementation of CTS at Jaipur, Amritsar, Agra and Jalandhar has been completed. The timeline set by NPCI for completion of the project is extended to 30th April 2014.

Southern Grid:

MICR centres:

- Total 29 MICR centres have been migrated to CTS in Southern Grid comprising of 23 MICR centers from Southern states and 6 centres Kolkata, Chandigarh, Ludhiana, Bhubaneswar, Guwahati and Cuttack.

NON-MICR centres:

- 4 Non MICR centres in Tamil Nadu have been migrated to CTS Southern Grid.

Western Grid:

- CBO Mumbai went live on CTS Western Grid on 26th August 2013 on pilot basis. CBO Mumbai is processing all the inward instruments centrally. 21 CBO centres from the States of Maharashtra, Goa, Rajasthan, Madhya Pradesh, Chhattisgarh, Gujrat are participating in CTS Western Grid.

2. SFMS:

- SFMS platform is available for all the branches for sending/receiving LC.

3. Integrated Treasury Management Solution (ITMS) Project :

Money Market Modules has been made on-line w.e.f. 16.12.2013 with Call/Term/Notice Money - Borrowing/ Lending, Mutual Fund equity/Preference Shares and Venture Capital Fund.

Fixed Income Modules (except CSGL) has been made parallel w.e.f. 10th March 2014 comprising of a) Treasury Bills b)Central Govt Securities c) State Development Loans d) Bonds e) Debentures f) Security General Ledger g) STP with NDS Systems.

Remaining Money Market Modules have also been made parallel w.e.f. 10.03.2014 to take care of -

1. Liquidity Adjustment Facility (LAF):a) Repo b) Term Repo c) Marginal Standing Facility (MSF) d) Reverse Repo and

2. Collateralized Borrowing & Lending Obligation (CBLO).

4. In-House Software Development:

The Bank has developed following software in house-

- Electronic Voucher Checking System (EVCS) for supplementary checking has been developed and made live since 21st September 2013.

- Conducted Computer Literacy Exam for promotion process.

- Branch Visit Report for Zonal Managers has been made live from 16th August 2013.

- Legacy to CBS (14 digit) Account Number Conversion Utility (ANCU) for NACH-ECS Credit Clearing files as per the advice of NPCI done. The package has been live since last week of November, 2013.

- Online facility module for "submission of monthly progress report of probationary officers (PO/MBA) is developed and is live.

- Online Annual Property Return (APR) module is developed and is live.

The following softwares are in development phase:

- Visitor Management module has been developed and tested. It is under trial run.

- Iranian Vostro Management Solution is being developed to manage/ monitor Iranian Vostro Account Transactions. All the masters (Applicant, Beneficiary, User etc) have been made live for data feeding purpose. Module for Swift Message MT103 & MT202 has been developed & tested. Developments of remaining LC related modules are in progress.

- A module has been developed for ''Inclusion of statements pertaining to Law department in Bank''s MIS and deployed for testing by Law department.

- Bank has developed and integrated a module in Finacle for issuance of ''Inflation Indexed National Saving Securities- Cumulative, 2013("The Bonds") issued by RBI in consultation with Govt of India.

- A new menu ''DUPCUST'' is provided in Finacle for use by branches at pre account opening stage to ascertain if customer is already having account with Bank.

- The Bank has developed a module for submission of online application form for the promotion of Sub-staffs, & Clerks.

- Loss Data Management System & Letter Tracking System is under development by Bank''s in-house development team.

- Bank has developed a module to capture the details of Fixed assets purchased prior to 01.04.2012.

16. OPERATION AND SERVICES :

During the year 2013-14, the Bank has come out with Business Continuity Plan Policy. "UCO Sujhav" a webpage in UCO online provide opportunity for the staff member to give their suggestions to improve the procedures and processes. The same has been operationalized during 1st quarter of 2013-14.

i) ATM Switch and Finacle Cash Tally - Development of In-house package. An in-house package has been developed to check the differences, if any, in the cash balance between ATM Switch and respective ATM cash A/c in Finale (GL A/c). Automatic e-mails will be generated and sent to the branches having difference in aforesaid heads for immediate rectification with a copy of the said e-mail to Zone and Circle concerned for monitoring.

ii) Use of ADMIN Cards - Development of In-house package. For ensuring usage of ADMIN Cards properly by the branches while loading cash in ATMs to match the cash position, Bank has developed a system (package ) to check whether the branches are using the ADMIN Cards while loading cash.

iii) Monitoring of reconciliation between CBO and branches in their jurisdiction - Software is developed in-house to compare the balances of Service Branch and balances of branches. If balances are not brought to zero on every Friday day-end/Saturday day beginning, automatic e-mail is being sent to CBOs and respective branches with a copy to Zonal/Circle Office concerned for immediate rectification.

Customer Grievances Redressal :

There is a well defined Grievances Redressal Mechanism in the Bank and efforts are made to resolve the complaints within the time frame. Customer complaints are resolved completely to the satisfaction of customers. The standardized Public Grievance Redressal System, a completely system based grievance management system, facilitating a customer to lodge on-line complaint by visiting Bank''s Website was successfully launched w.e.f 01.11.2013. The system has auto acknowledgement facility. The same system provides the facility to different administrative set-ups as well as branches to enter and maintain the complaints received through other modes.

Government Business:

- Revised procedure has been implemented for receipt of challans and payment of cheques issued by Geological Survey of India (GSI) and Indian Bureau of Mines (IBM) and thereby claiming reimbursement from link cell Sitabuildi Branch Nagpur (0296).

- Tamil Nadu State Government Tax collection scheme has been integrated with our internet banking for all types of tax collection of Tamil Nadu Government from Dec 2013 onwards.

National Pension System (NPS): The Swavlamban Scheme under National Pension System was successfully customized under Government Business Module of Finacle and made operational in the month of January, 2014 for use by the branches for enrolment of subscribers under the scheme.

Frequency of Branch Visits by Zonal Managers has improved . Bank has reviewed the a) Compensation Policy b) Deposit Policy c) Unclaimed Deposit Policy and d) Grievances Redressal Policy in order to incorporate the RBI Guidelines.

17. CORPORATE COMMUNICATIONS :

Bank has taken up various initiatives through various channels namely Print Media, Outdoor Media, Digital and sponsorship for publicity, public relations, CSR activities and dissemination of requisite information to customers and common public at large ultimately to build and maintain a brand-image that is relevant, customer-oriented and trustworthy.

a) Publicity Campaigns:

Print Media:

Print media is an effective medium to connect to masses, and Corporate Communications has utilised it effectively by carrying out intensified and vigorous publicity campaigns throughout the FY 2013-14. Liability products, viz, UCO Double, UCO Triple One, UCO Double Century, Dhanvarsha, Dhanlaxmi, UCO Tax-Saver, Sowbhagya, UCO Savings Account were publicized through print media. Asset products, viz., UCO Home Loan, CAR Loan, CA Loan and Festival Bonanza scheme for UCO Home and Car loan were also promoted during the period.

With a thrust on routing the transactions through alternate channels and making banking more personalized and customer- oriented, E-Banking, M-banking, Online FDR facility were publicized through Print media during the period.

Publication of financial results in leading national and local dailies was also carried through Print Media.

Radio Jingles and Television Commercials:

Electronic media aided by technological development has widened its reach to remotest corner of country. Campaigns through Television were carried for promoting bank''s debit card facility. Radio jingles were carried out during Foundation Day for spreading its message to its customers and common public at large after completion of 71 glorious years of its existence.

Rural Publicity:

Rural publicity is an integral part of publicity-campaign for Bank having pan-India and strong rural presence and can not be overlooked. Bank has promoted and monitored various rural publicity campaigns through circle offices located across the country. Wall-Paintings, announcements by Rickshaw, Loan- Fairs, etc were carried out for promoting awareness about products and services offered by bank.

b) Celebration of 72nd Foundation Day:

On occasion of completion of 71 glorious years of its existence, bank celebrated foundation day on 6th January 2014 with great zeal and enthusiasm. Employees and executives of the Bank participated in the Road Show from Founder''s Branch to General Administration Department, Russel Street, Kolkata. During the celebration, Asset and Liability products viz, UCO Home Loan, UCO Car Loan, MIS, Sowbhagya were publicized through Banners and standees at venue and road-show. Circle and Zonal offices across the country organised various events viz, plant sapling, blood-donation and free health check-up camps on the occasion. Super achievers under different categories were felicited at Head Office and Circle Offices. Also, Customers having log-term relationship with Bank were honoured by the Bank.

c) Public Relations:

l Press Meet:

Dissemination of information and coverage of important events and occasions viz, Financial Results, Awards & Recognition, Opening of new branch & ATMs is prerequisite for strengthening the public relations. During the FY 2013-14, Corporate Communications department of the Bank, organised press meets for declaration of quarterly and yearly financial results and as required from time to time.

l Press Release:

Timely coverage of important events plays an integral role in creating awareness about important events and achievements of Bank. Corporate Communications department of the Bank arranged for press-release of financial results, foundation day celebrations, annual business meet and other important events in leading national and local newspapers throughout the FY 2013-14.

d) Corporate Social Responsibility:

Bank believes that carrying out CSR activities helps in creating tangible value-creation and ultimately contributing to brand- image. Moreover, CSR creates a positive image in the mind of customers and society at large. This creates a sense of belongingness and loyalty in existing and prospective customers. During the financial year 2013-14, following CSR activities were carried out by the Bank :

- Financial assistance of Rs.100 lacs to the Prime Minister''s Relief fund for the victims of Uttarakhand Floods-2013.

- Financial assistance of Rs.155 lacs to 1204 number of schools adopted by our Rural and Semi-Urban branches in form of Fans/Water Purifiers/Toilet Blocks.

- Financial assistance of Rs.4.62 lacs to "Aim for Seva" for its Free Student Homes, Jeypore, Odisha.

- Financial assistance of Rs.15.69 lacs to Akal Charitable Hospital for procuring Ambulance Van in service of tribal/ rural underprivileged critical patients.

- Financial assistance of Rs. 3.13 lacs to Kamakhya Debutter Board, Guwahati for purchase of one ambulance for assisting primary health care service.

- Financial assistance of Rs.2.54 lacs to Ramakrishna Mission Ashrama, Kothar, Bhadrak, Odisha.

- Financial assistance of Rs.15 lacs to Chief Minister''s Relief Fund for rehabilitation of cyclonic storm "Phalin" affected people, under Bhubaneswar Circle.

- Financial assistance of Rs.3.5 lacs to the Prisons Department of Himachal Pradesh Government for procurement of one vehicle for use as"mobile canteen" for prisoners.

- Financial assistance of Rs.22 lacs for installation of 100 solar lights towards development of 23 villages adopted during centralised inauguration of 7 branches under Circle office lucknow at Rae Bareli.

- Financial assistance of Rs.10.72 lacs for procurement of Tipper to Panaji Muncipal Corporation, Mumbai, under Mumbai circle office.

18. HUMAN RESOURCE MANAGEMENT:

Human Resources play an important role in the growth of an organization. Human resources department is instrumental in creating a vibrant organisational culture in which employees are encouraged and motivated to perform their best. Human Capital plays a vital role in accomplishment of corporate goals. Banking is a service oriented industry and achievement of business goal of Bank depends on good service provided to customers . In order to provide efficient customers service, recruitment of talented people is essential.

MANPOWER

The total Staff Strength as on 31st March,2014 stood at 24557, including employees serving overseas, 14 of which are expatriate officers. The total domestic staff strength of 24543 comprises of 11580 Officers, 8421 Clerks and 2785 Subordinate staff and 1757 Sweepers.

The percentage of Scheduled castes (4827) and Scheduled Tribes (1583) taken together In the total domestic staff strength is 26.09. Besides, there are 2435 OBC employees in service of the Bank at the end of March, 2014 and 1126 employees belong to Minority Communities. The total work force constitutes 17.80% women employees (4371) as of March, 2014.

During the year 2013-14 pre-promotion trainings were imparted to SC/ST candidates as per Government of India directives.

Recruitment

Bank has recruited 1209 officers during the year 2013-14, which comprises of 186 SCs, 87 STs and 299 OBCs and 408 Women. 889 Clerks have also been recruited during the year 2013-14, of which includes 112 SCs 87 STs, and 271 OBCs,304 women, 37 Ex-servicemen,4 dependents of Ex-servicemen and 23 persons with disabilities and 67 persons belonging to Minority Communities. Moreover, the Bank has also initiated the process of recruitment of 2100 Clerks, 1300 Probationary Officers and 600 Generalist Officers in Scale-II (CA-150 , MBA – 300, ICWA -100 and CFA-50) during the year 2014-15.

Promotions

During the year 2013-14, Bank promoted 5 Executives to Top Executives Grade scaleVII, 8 Executives were promoted from ScaleV to Top Exewcutive Grade ScaleVI and 7 Executives were promoted from Scale IV to Scale V. Besides 67 officers were promoted to ScaleIV, 433 to ScaleIII and 342 to Scale II. In addition, under specialist category, 4 officers were promoted from Scale III to Scale IV, 8 officers were promoted to Scale III and 6 officers to Scale II. Further, during the period 374 Clerical Staff were promoted to Officers Cadre. Promotion from sub-ordinate to clerical cadre was also completed. Permission was granted to Zones for recruitment of 323 peons and 292 sweeper during the financial year.

Industrial Relations

During the period, the Industrial Relations climate in the Bank remained healthy and cordial between the Management and the Unions/Associations. IR meetings and discussions were held with Unions/Associations at periodic intervals through mutual co- operative attitude and respect during the financial year 2013-14.

Personnel Services

A separate Pensioners Grievance Cell for retired Staff members has been established. Simplified Family Pension format for Family Pension introduced. Pensioners Corner for our Pensioners has been put in our Bank''s Website. In Group Medi claim Insurance, the individual Buffer coverage has been increased from Rs.2.00 Lac to Rs. 3.00 lac for 5 in-service employees. Holiday Home facility at Shirdi, Tirupati and Mussourie is extended for the year 2014- 15.

Training

Top Management of the Bank gives due weighage to training because human resources in the Bank is the most valuable asset and this asset not only require proper care but also skill development and upgradation of knowledge. Concept paper on Training policy of the Bank has been prepared by Training Department. Emphasis was given to conduct more and more locational and camp based training programmes that are organized at Zonal Office level, taking care of current problems faced by the staff at grass root level. A total of 1077 clerks, 8766 officers and 139 sub-staffs were trained under in house training programmes in Central Staff College and Regional Training Centers of the Bank across the country upto Feb 2014.

A special training called CHETNA-III was conducted where 7286 clerical and 2100 subs-staffs were trained at Zonal Office level, where every aspects like basic retail products, behavioral science ,motivation etc were covered. 634 Field Officers were specially trained on Priority Sector Lending. More than 5560 officers and 1100 subs-staffs were trained location ally at Circle level. The detail of the topics covered for respective employee categories were Credit Appraisal, NPA Management, Priority Sector Lending, LAPS, Unicode, CBS, Security Aspects, Managerial Skills, Finacle Operation, Leadership Development etc.

Bank has sent 264 Officers/Executives to other Training Institutes like NIBM (Pune), CAB (Pune),IIBM (Guwahati), BIRD (Lucknow), IIBF (Mumbai), IDRBT (Hyderabad) and many other Institutes. During the financial year, Bank has sent six executives for overseas training programme also. Training schedule for women employees was also prepared by Training Department. One training per employee per year is the ultimate goal of the Bank.

The Bank is going to open 3 new Regional Training Centres at Durgapur, Pondicherry and Shillong. Bank is constructing additional classrooms /accommodation at their Central Staff College and Regional Training Centres for optimum capacity utilisation of faculty, space and quality time.

Initiatives by HRM Department

Launch of UCO Sadasya on Facebook.

UCO Sadasya is the name given to the profile exclusively for UCO bank staff members. It''s an initiative to connect all our staff members at once by overcoming the geographical barriers. This medium is best suited for the staff members who need to communicate, talk, discuss, and share their activities /concerns. As Facebook is very commonly used by most of the existing staff members for social interaction with their friends, relatives, other staff members, etc., UCO SADASYA was launched on 14.03.2014 in Facebook.

Attractions for staff members:

Facebook would be used to share information and data relevant and useful to the employees in their day to day office work. It would be used as a platform to share information on various retail products, divided into two broad categories, deposit products and other relating to loans and advances. Through this medium various staff related queries regarding retail products, job profile, branch performance, targets, etc. will be answered.

Through UCO Sadasya, various outperforming staff, branches, Zones and Circles will get recognition and their achievements will be shared with the entire UCO family. It will work as a medium to upload pictures, videos, news relating to any event or functions organized at the Head Office level, Zonal level or at the Branch level, etc. This initiative would be available at all time for all staff members, with an option to share or even download at their end for personal use. The Human Resource Management department will manage/monitor UCO Sadasya at present.

Annual Property Return Package – 2014

In terms of Regulation 20 (2) UCO Bank Officer Employees'' (Conduct) Regulation 1976 as amended, every Officer is required to submit Annual Property Return Statement (Form B, C, D & E) as on 31st March every year. As per the directives of the Central Vigilance Commission (CVC) Govt. of India, the Chief Vigilance Officer of the Bank is required to furnish a compliance certificate to this effect to CVC by 30th June every year.

In order to have better monitoring and timely completion of Annual Property Return (APR) submission process, the Bank decided that for the year ending 31.03.2014 onwards APRs up to Scale VII will have to be filled up Online. After development of APR – 2014 package, it was made live in UCO Online.

Achievements of SC/ST/OBC Cell of Head Office, HRM Department

The Bank has been implementing reservation policy of Government of India. Reservation and other relaxation and concessions extended to SC/ST/OBC/Persons With Disability (PWD) and Ex-Servicemen employees of our Bank is strictly adhered. As per GOI guidelines the Department imparted Pre- Promotion Training to 840 candidates (SC-590 and ST-250) belonging to SC/ST category. The motive behind organizing such training was to bring such SC/ST candidates up to the level of other candidates. Also, in order to educate HR functionaries working at various Zonal Offices regarding Reservation Policy of Government of India and maintenance of Reservation Rosters, the Department arranged training programmes in Varanasi and New Delhi. 17 officers working in different Zonal Offices participated in the training programme. Further, a separate workshop on writing of Reservation Roster and Reservation Policy of Government of India was organized at Central Staff College, Kolkata on 3rd and 4th March, 2014 on the above subject in which 17 officers representing various Zonal Offices participated in the programme. Also, in order to address the issues of SC/ST and OBC employees of the Bank periodical meetings are being held at Apex level as well as at Zonal Office level with welfare association of such employees.

19. AUDIT & INSPECTION

The Bank has a well-established Audit and Inspection Department that examines adherence to the Systems and Procedures. Bank has comprehensive Inspection and Audit Policy for undertaking Internal Inspections, Concurrent Audit, Revenue Audit, Risk Based Internal Audit, and information System Audit. The guidelines received on various issues of Internal Control from Reserve Bank of India. Government of India, Board and Audit Committee of the Board have become part of the internal control system for better risk management.

During the year 2013-14, the Bank has given focused attention to close overdue inspection reports outstanding for more than 3 months by rectification of major & other irregularities. The regular branch inspection report is the most comprehensive feed-back to the management about compliance of the Bank''s systems and procedure and guidelines at operational level.

A focused attention is given to bridge the knowledge gap of Inspecting Officers (Mobile) by imparting periodical training to them for putting the system and procedure of the Bank at a desired / better level.

The major achievements during 2013-14 was that the Bank has successfully implemented System based Risk Based Internal Audit in compliance to Basant Seth Committee recommendation and also out of total revenue leakage detected Rs.55.50 crore, Rs.48.38 Crore was recovered on the spot by internal/external auditors concerned.

20. VIGILANCE:

Vigilance Department of the Bank is headed by the Chief Vigilance Officer (CVO) of the rank of General Manager who is on deputation from State Bank of Travencore. The Vigilance Department focuses on initiation and dissemination of preventive vigilance measures.

During the year 2013-14, CVO has visited 112 branches and quite a few administrative offices to create awareness among staff members. In the field level, field vigilance officers also visited 285 branches to plug the loopholes in the existing system to prevent recurrence of similar frauds and to strengthen the preventive vigilance. The Vigilance Department also conducted four training programmes for EOS and POS covering more than 135 officers all over the country for imparting knowledge for expeditious conclusion of RDA cases. It also conducted training programme for officers of CBI to acquaint them with Bank''s system and procedures for investigation of bank frauds. The department has also compiled Vigilance Manual for the Bank and unveiled it in the Annual Business Meet of the bank held on 21st & 22nd April, 2014.

21. MANAGEMENT AUDIT AND HR AUDIT:

During the year 2013-14 the department has conducted Management Audit in 13 Zonal Offices, 6 Circle Offices, and Four Corporate Departments. The Reports have been closed in all cases after getting the irregularities rectified by the concerned Authorities. So far Performances related to HR Audit is concerned, H R Audit (Manpower Assessment) of 6 Specialised Branches (FCC, Treasury and CBO) and 11 Corporate Departments were conducted during the period under Review. Observations/directions of the Competent Authority in respect of such Reports have been forwarded to the respective departments for taking necessary action.

22. MANAGEMENT INFORMATION SYSTEM:

To ensure timely and consistent submission of returns, RBI had proposed for automation of the data flow from the Banks ,since most of the reports were being submitted manually. Under the aegis of Core Banking Platform our Bank has implemented Automated Data Flow (ADF) to comply to the direction of RBI.

The Automated Data Flow has been implemented and within the stipulated time frame, Bank has delivered 132 RBI reports applicable to us and are ready for online submission to RBI through ADF portal. At present 132 RBI Reports are available and as per XBRL taxonomy supplied by RBI, 13 reports are ready for online submission to the RBI in XBRL format.

To reap the additional benefit of ADF under CBS environment, Bank is also utilizing the ADF platform for single source of data to cater to all the concerns both external (RBI , Government, etc) & internal authorities (Corporate Departments) steps have been taken to remove data inconsistency.

Bank has taken steps for integrating discrete systems like GBM, ATM, e-Banking , ALM , Treasury & International Division and Overseas Branches to have all information in the palm for proper control & monitoring of business & draw meaningful business continuity plan .

Bank has also initiated action for Business intelligence ( BI) tool for effectively monitoring the business growth & taking timely corrective action wherever necessary. Training on BI tool has been imparted to all IT skilled officials of Circles, who can utilize the benefit of BI tool for monitoring & accessing business performances of Zones & Branches.

23. COMPLIANCE OF OFFICIAL LANGUAGE POLICY

The Bank has taken proactive steps to implement the Official Language Policy of Govt. of India and has meticulously taken steps to comply with the provisions of the Official Languages Act and the Rules made there- under. The Bank has also taken appropriate follow-up action to implement the directives as contained in the Annual programme with regard to the use of Official Language Hindi issued by Government of India, Ministry of Home Affairs, Dept. of Official Language and also endeavored to achieve various targets prescribed in the said programme. The Bank has also given preferred attention to comply with the instructions of Financial Services Department, Ministry of Finance and Reserve Bank of India regarding the use of Hindi in official work.

Ninety Seven Hindi Workshops were organised by the Bank for the Officers and employees to motivate them to do their work in Hindi. Total 2199 Officers / employees were trained through these Hindi Workshops. In view of the directives of Govt. of India to promote ''UNICODE'' application on all the computers, a session was allotted in these workshops to acquaint all Officers and employees with its application and activation. Apart from this, Officers/employees were nominated to attend 5 days Basic computer training programme conducted by Dept. of Official Language, Ministry of Home Affairs, Govt. of India.

449 branches were inspected by Official Language Officers posted at different Zonal offices, 4 Zonal offices, and one department of Head Office were also inspected by Chief Manager(O.L.) posted at Head Office during the period under review to evaluate the performance in the area of implementation of Official Language Policy of Govt. of India and necessary remedial measures were also taken to remove the deficiencies observed in such inspections.

During the period under review a seminar on the subject was successfully organized by Zonal Office, Lucknow and Dharamshala.

During the period under review 5 day Translation training programme for Hindi Officers was organized at our Central Staff College, Kolkata under the aegis of Central Translation Bureau, Govt of India. Our Bank successfully organised ''HINDI UNICODE WORKSHOP'' for the Executives of all Public Sector Banks & Financial Institutions posted in the Kolkata Pin Code area under the auspices of Kolkata Town Official Language Implementation Committee (Banks'').

In view of the requirement to accelerate the pace of implementation and effective compliance of Official Language Policy of Govt. of India at Head Office, a two day motivation programme for the Official Language Officers and Nodal Officers posted in various departments of Head Office was organised at our Central staff College, Kolkata. In addition, monthly meeting is also held to review the progress made and difficulties being faced in compliance of the OL Policy of the Union at HO.

Zonal Office Jaipur, Raipur, Mumbai, Indore, Jodhpur, Ahmedabad, Ranchi, Pune, Chandigarh, Coimbatore and Bhopal continued to publish Hindi e-magazines during the period under review.

Our Bank successfully organised various competitions, rendered editorial assistance to other Public Sector Banks & Financial Institutions in conducting ''HINDI UNICODE WORKSHOP'' & ''Hindi workshop'' under the auspices of different TOLIC''s.

Various forms / publicity materials / procedural booklets and report of Annual General meeting of Shareholders, Manual of Instructions, Minutes of various Board Committees were prepared in bilingual form. Hindi text of the materials for our Bank''s Website was also prepared. Sufficient amount was allocated by the Bank for the purchase of classic literary Hindi books, dictionaries, technical glossaries, Hindi books on computer/banking etc. and famous literary books in regional languages written by renowned litterateurs.

In view of effective monitoring of the work with regard to the use of Hindi in official work, the position of our Bank was vividly reviewed in the meetings of Apex Official Language Implementation Committee of the Bank.

"Hindi Month", "Hindi Fortnight", "Hindi Week" was celebrated enthusiastically at Head Office as well as Zonal Offices, Central Staff College, Regional Training Centers and Branches.

During the period under review Zonal Office, Patna and Zonal Office, Jalandhar were awarded 1st Prize / Shield and Zonal Office, Ranchi, Zonal Office, Bhubaneswar and Zonal Office, Dharamshala were awarded 2nd Prize by TOLIC Patna, Jalandhar, Ranchi, Bhubaneswar and Dharmashala respectively

The Third Sub-Committee of the Committee of Parliament during their visit to Kolkata inspected our Head Office on 4th October, 2013 in respect of implementation of Official Language Policy in our Bank and expressed their satisfaction on observing the steps taken by our Bank for augmenting the use of Official Language Hindi in official work. The Drafting and Evidence sub Committee of the Committee of Parliament also discussed regarding about implementation of Official Language Policy with the Chairman and few member Banks of TOLIC, New Delhi including our Zonal Office, Delhi on 11.01.2014.

24. COMPLIANCE:

The Bank has emphasized on compliance issues as mandated by RBI. The Bank has been ensuring the level of customer service, functions and compliance of rules of deposit, advances, KYC/AML, other services, prompt submission of statutory/ regulatory reports, information and data asked by RBI, GOI, etc. through a strict compliance system. Compliance Policy – 2013 was prepared incorporating necessary changes to prevent breaches in the areas of compliance functions and the same has been circulated to all branches and offices of the Bank after due approval by the Board of Directors in its meeting held on 10.04.2013. During the year, Test Checking of compliance functions has been undertaken in 333 branches and 8 corporate offices. Deficiencies observed are being rectified on the spot and branches/offices have been sensitised about compliance functions so as to avoid compliance breaches. Critical issues were reported and discussed at the appropriate level to enhance efficacy of the system. Interactions are also being held with Inspection Department & Risk Management Department periodically to discuss issues relating to compliance functions and to suggest measures to avoid recurrence thereof.

25. LEGAL MATTERS :

The Law Department of the Bank plays a significant role in the various legal matters of the Bank. It is acting as a facilitator and attends to various matters covering opinion, documentation, litigation etc., emanating from various functional departments at Head Office, Circles/Zones, branches and overseas branches. The department has organized a 3-day workshop for Law Officers during 2013-14. Hand Book on SARFAESI was prepared and sent to all branches/offices for reference and exhaustive guidelines issued for filing and handling of DRT cases. Bank conducted various workshops at Circle Offices to streamline monitoring and follow up of cases filed by and against the Bank.

The department regularly advises the Circle and Zonal offices about further course of action to be taken in DRT and SARFAESI cases, BIFR, CGIT, NI Act and other cases filed by and against the Bank.

Exhaustive guidelines including latest amendments in various Acts and Case Laws affecting bankers have been issued on topics covering DRT, SARFAESI, Indian Registration Act, Maharashtra Stamp Act, liabilities of legal heirs as borrower, New Companies Act, Lok Adalat etc,. Matters pertaining to agreement for sale & assignment of assets, finalisation and execution. Loan document for UCO Pensioners'' Scheme was also introduced by the department.

26. FUTURE PLAN:

During the year, Bank has further strengthened its retail base on both Liability & Assets side. Bank''s focus will continue to remain towards Retail business model and credit flow other than retail advances will mainly constitute potential segments/sectors which have low risk weights. However, with the improvement in Economic Scenario and with Govt''s intervention to create a favorable investment climate for development of Infrastructure facilities in the country, bank will take a call to participate in New large projects. Keeping in view the significant performance in priority sector lending and inclusion of large number of rural population into the bank''s fold through direct agriculture, allied activities & MSE advances, Bank will continue to strive for maintaining the sustainability of providing small loans to rural & semi urban population.

Another area of focus shall remain the customer acquisition campaigns in all geographical regions of the country through branch network spread, through Ultra small branches and other out - reach programms.

Leveraging the technology to provide convenient & safe banking for customers will continue to remain focused. Technology upgradation with changing times and in sync with new business initiatives/opportunities will always remain the facilitator for delivery & control tool for the management. Keeping in view the sentiment of consolidation of Retail business across various sectors of the economy, Bank will sum up the year 2014-15 for third time in succession as "Retail Business Year".

27. BOARD OF DIRECTORS:

Corporate Governance

The Bank firmly believes in and has consistently practiced good corporate governance which is woven around its core values of transparency, professionalism and accountability. By constantly focusing on these aspects in its day-to-day operations, the Bank strives to enhance shareholders'' value. The Bank being committed to the principles of good governance, its Board of Directors has formed various committees of the Board to monitor every aspect of Bank''s business. The systems and business processes of the Bank are continuously reviewed at various levels for identifying and strengthening areas of weaknesses, if any. The Directors of the Bank believe that good governance is the key to earning trust, loyalty and goodwill of clients, business associates, employees and investors and respect from the society at large.

Changes in the Board of Directors

Mr. N.R.Badrinarayanan served as Executive Director in the Board from 01.09.2010 to 30.06.2013.

Mr. J.K.Garg has been appointed as Executive Director with effect from 05.08.2013.

Prof. S.L.Morris served as Shareholder Director in the Board from 13.07.2010 to 12.07.2013.

Mr. Sunil Kumar Maheshwari has been appointed as Part Time Non-Official Director in the Board w.e.f.21.06.2013.

Mr. Salahuddin Ansari has been appointed as Part Time Non- Official Director in the Board w.e.f. 26.06.2013.

Meetings of the Board of Directors

During the financial year 2013-14, the Bank had 13 meetings of the Board of Directors, 14 meetings of the Management Committee of the Board, 9 meetings of the Audit Committee of the Board. The number of meetings of various other Committees of the Board held during the year 2013-14 is given below:

Sl No. Name of the Committee No. of meetings held

1. Management Committee of the Board 14

2. Audit Committee of the Board 9

3. Risk Management Committee 5

4. Shareholders Grievance Redressal Committee 3

5. Share Transfer Committee 5

6. Special Committee for Monitoring Large Value Frauds 3

7. Customer Service Committee 4

8. Committee on HR Related Issues of the Bank 2

9. Nomination Committee of the Board 1

10. Remuneration Committee of the Board 1

11. IT Strategy Committee of the Board 3

12. Board Level Committee for Monitoring Recovery in NPA Accounts 4

13. Committee for Disposal of Appeal Cases 3

Statement of Directors'' Responsibilities

The Directors confirm that in the preparation of the annual accounts for the year ended March 31, 2014, 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 Reserve Bank of India, were consistently applied. Reasonable and prudent judgements and estimates were made so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit of the Bank for the year ended March 31, 2014. 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 an on-going basis.

Acknowledgements

The Board of Directors places on record its deep appreciation of the contributions made to the deliberations of the Board by out- going Directors namely, Shri N.R.Badrinarayanan, and Shri S.L .Morris. The Board would like to welcome the new Directors and looks forward to their valuable inputs towards growth of the Bank. The Directors remain thankful to the Government of India, Re- serve Bank of India and other regulatory authorities for their sup- port and valuable guidance. The Board also thanks other Financial Institutions and correspondent banks for their sincere co-operation. The Directors express their gratitude to the loyal customers for their trust and continuous patronage of the Bank. The Board also thanks the Staff Unions/Associations and shareholders of the Bank for the support extended by them. The Directors place on record their deep appreciation of the dedication shown by each employee of the Bank due to which the Bank could achieve so many milestones.

For and on behalf of Board of Directors,

Date: May 29, 2014 (Arun Kaul)

Chairman & Managing

Kolkata

Director


Mar 31, 2013

1. BUSINESS PROFILE:

The Bank has crossed Rs. 3,00,000 lakh crore of business as of 31st March, 2013, which is a milestone in Bank''s history.

The year 2012-13 was ''Retail Business Year'' for the Bank. The Bank has been successfully able to transform itself in following retail business model. On Asset side, the focus which the Bank laid on retail advances, particularly financing of ''UCO Home'', ''UCO Car'' and ''UCO Gold'' resulted into a growth of 22.30 per cent during the year 2012-13.

The emphasis on portfolio of LC Bill discounting resulted in reducing the dependence on corporate credit. LC bill discounting portfolio increased from Rs. 4215 crore as of 31.03.2012 to Rs. 12615 crore as of 31.03.2013, thereby showing an increase of Rs. 8400 crore. In fact, the major growth of incremental advances during the year 2012-13 was from Retail and Priority Sectors along with LC bill discounting portfolio.

On Liability side, the increase in CASA portfolio, particularly that of Iranian funds as also increase in term deposits portfolio of less than Rs. 5 crore brought down the dependence on bulk deposits, thereby the proportion of bulk deposits C-D getting reduced from 46 per cent as of 31st March, 2012 to 28 per cent as of 31st March, 2013.

During the year 2012-13, the Bank showed a respectable growth in all business parameters. The global business of the Bank increased from Rs.2,71,507 crore as of 31st March, 2012 to Rs. 3,05,000 crore as of 31st March, 2013, with a growth of 12.34 per cent. In deposits, the growth was 12.62 per cent, increasing from Rs. 1,54,003 crore as of 31st March, 2012 to Rs. 1,73,431 crore as of 31st March, 2013. In advances, the growth was 11.97 per cent.

SL NO. Particulars FY 12 FY 13 GROWTH

Global - (In Rs. Cr) A bsolute Percentage

(i) Deposits 154003 173431 19428 12.62

(ii) Advances 117504 131569 14065 11.97

(iii) Total Business 271507 305000 33493 12.34

The domestic business of the Bank showed an increase of 11.10 per cent or in absolute terms Rs. 27734 crore and stood at Rs. 277591 crore as of 31st March, 2013. The total domestic deposits increased from Rs. 142017 crore as on 31st March, 2012 to Rs. 158386 crore as on March 31,2013; thereby showing an increase of Rs. 16369 crore or 11.53 per cent. Total domestic advances increased by 10.54 per cent with an absolute growth of Rs. 11365 crore and stood at Rs. 119205 crore.

SL NO.Particulars FY 12 FY 13 GROWTH

Domestic - (In Rs. Cr) Absolute Percentage

(i) Deposits 142017 158386 16369 11.53

(ii) Advances 107840 119205 11365 10.54

(iii)Total Business 249857 277591 27734 11.10

Per branch business improved from Rs. 104.54 crore as of March, 2012 to Rs. 106.36 crore as of March, 2013. In terms of Per branch deposits, it increased from Rs. 59.42 crore as of March, 2012 to Rs. 60.68 crore as of March, 2013. Per branch advances also improved from Rs. 45.12 crore as of March, 2012 to Rs. 45.67 crore as of March, 2013.

The Bank''s CASA deposit to total domestic deposit ratio stood at 34.96 per cent up from 23.85 per cent last year. The Bank''s Savings deposits reached Rs. 29680 crore as at March, 2013 compared to Rs. 26267 crore as on March, 2012, registering a growth of 12.99 per cent and current deposits at Rs. 25694 crore as at March, 2013 showed a growth of 238.08 per cent from Rs. 7600 crore as at March, 2012.

SL NO. Particulars FY 12 FY 13 GROWTH In Rs. Cr) Absolute Percentage

(i) Current 7600 25694 18094 238.08

(ii) Savings 26267 29680 3413 12.99

(iii Domestic 33867 55374 21507 63.50

(iv) CASA Ratio 23.85 34.96

During the year, the Bank added over 25.10 lakh CASA customers.

The overseas business of the Bank showed an increase of 26.60 per cent and stood at Rs. 27409 crore. The total deposits of the overseas branches increased from Rs. 11986 crore as of March, 2012 to Rs. 15045 crore as of March, 2013; thereby showing an increase of 25.52 per cent or in absolute terms Rs. 3059 crore. The overseas advances increased by Rs. 2700 crore or 27.94 per cent and stood at Rs. 12364 crore as of 31st March, 2013.

The global per employee business of the Bank has increased from Rs. 12.47 crore as of March, 2012 to Rs. 13.43 crore as of March, 2013.

SL NO. Particulars FY 12 FY 13 GROWTH In Rs. Cr) Absolute Percentag



(i) Deposits 11986 15045 3059 25.52

(ii) Advances 9664 12364 2700 27.94

(iii Total Business 21650 27409 5759 26.60

2. PROFITABILITY:

The operating profit of the Bank, during the year 2012-13, increased by 19.41 per cent from Rs. 2811.42 crore during 2011-12 to Rs. 3357.09 crore in 2012-13. However, the net profit of the Bank showed a decline by 44.24 per cent from Rs. 1108.67 crore during 2011-12 to Rs. 618.20 crore in 2012-13. The decrease in net profit has been primarily due to heavy provisioning on account of NPAs. Total provision requirement for the entire financial year was at Rs. 2739 crore, compared to earlier year''s provision of Rs. 1703 crore. The provision for only NPAs during the year 2012-13 was Rs. 1779 crore vis-a-vis Rs. 756 crore in 2011-12.

Net Interest Income of the Bank showed a healthy growth of 17.41 per cent during 2012-13 with Cost to Income Ratio coming down by 2.91 percentage points in the same period.

Total Income for the full year FY 2013 was Rs. 17704 crore compared to Rs. 15598 crore for FY 2012. The Bank''s interest income for the whole year was at Rs.16752 crore compared to

Parameter 31.03.12 31.03.13 Change(%) As on 31.03.12 As on 31.03.13

Net Interest Income 3902.10 4581.53 17.41

Variation

Cost of Income 42.24 39.33 (-) 2.91

Rs.14632 crore for FY''12. Total expenses for the whole year was Rs. 14347 crore compared to Rs. 12787 crore for FY12. Operating expenses reached Rs.2177 crore during the entire year compared to Rs.2056 crore for FY12.

Parameter 31.03.12 31.03.13 As on 31.03.12 As on 31.03.13

Book Value per Share 94.72 97.19

Net Interest Margin (Global) 2.77 2.34

Return on Assets 0.69 0.33

3. CAPITAL :

During the year, the Bank allotted 8,79,16,343 equity shares to Government of India on preferential basis at an issue price of Rs. 77.46 per share determined in accordance with SEBI ICDR Regulations, 2009. Bank had received Rs. 681 crore from Government of India against allotment of above equity shares.

The total capital of the Bank as on 31st March, 2013 stood at Rs. 2575.63 crore. The Reserves and Surplus stood at Rs. 7106.78 crore as on 31st March, 2013.

4. CAPITAL ADEQUACY RATIO:

The Bank continues to maintain healthy capital base. As at March, 2013, Capital Adequacy Ratio as per Basel-II norm stood at 14.15 per cent (as against a mandatory requirement of 9 per cent) with a Tier I capital ratio at 9.05 per cent (as against mandatory requirement of 6 per cent). Adequate headroom is now available under both Tier-I and Tier-II options to raise capital to support business growth. Government shareholding as at 31st March, 2013 stood at 69.25 per cent. The Bank has a strong Common Equity Capital to meet the stringent Basel III norms during the current year.

(Rs. in Crore)

2011-12 2012-13

Sl. No. Capiital Adequacy Ratio (%)

1. Tier I (Absolute) 7890.76 9157.13

2. Tier II (Absolute) 4151.46 5140.94

3. Total Capital (I II) (Absolute) 12042.22 14298.07

4. Tier I (%) 8.09 9.05

5. Tier II (%) 4.26 5.10

6. Basel-II (%) 12.35 14.15

7. Basel-I (%) 11.03 12.43

5. TREASURY & INVESTMENT MANAGEMENT:

The Bank has been performing its Treasury & Investment Operations keeping track of the macroeconomic and market developments in accordance with the guidelines issued by the Reserve Bank from time to time as also the Bank''s Corporate Investment Policy approved by the Board of Directors. In the changed scenario, where state of the art technology is providing cutting edge in Treasury and Risk Management, the Bank has also embarked upon a globally deployable Integrated Treasury management Solution for an effective and efficient way to optimize resource utilization and maximize returns on investment/ trading.

In order to mitigate risk and balance sheet management the Bank has gone for interest rate swap transactions. During the year 2012-13, the Bank has concentrated a lot on improving its M - Duration by investing in short term highly liquid instruments such as the Treasury Bills.

Total global Investment (Gross) of the Bank during the year 2012-13 grew by 13.71 per cent from Rs. 46185 crore as on 31.03.2012 to Rs. 52515 crore as on 31.03.2013. The Domestic Investment grew by 13.98 per cent from Rs 45038 crore as on 31.03.2012 to Rs 51335 crore as on 31.03.2013. SLR investment increased by 8.09 per cent during the year 2012-13 by registering the level of Rs. 43347 crore in March 2013 as compared to Rs. 40102 crore in March 2012. Non-SLR investment (Domestic) registered a robust growth of 61.83 per cent to rise from Rs. 4936 crore in 2012 to Rs. 7988 crore in 2013. The yield on domestic investment increased from 7.45 per cent as on 31.03.2012 to 7.59 per cent as on 31.03.2013. Total Investment income has registered a reasonable growth of 15.15 per cent to reach the level of Rs 3635 crore in March 2013 from Rs 3156 crore in March 2012.

SL NO. Particulars FY 12 FY 13 GROWTH

(in Rs. cr) Absolute Percentage

(i) Global 46185 52515 6330 13.71

(ii) Domestic 45038 51336 6297 13.98

(iii) Overseas 1147 1180 33 2.88

6. SOCIAL BANKING:

i) Priority Sector Lending:

During the year 2012-13, the Priority Sector advances of the Bank stood at Rs. 34962 crore constituting thereby 32.13 per cent of Adjusted Net Bank Credit (ANBC). The Y-O-Y growth of Priority Sector advances stood at 23.54 per cent.

ii) Agriculture Advances:

Total agriculture advances of the Bank stood at Rs. 12625 crore constituting 11.60 per cent of ANBC. Direct agricultural credit stood at Rs.9986 crore constituting 9.18 per cent of ANBC and Indirect agricultural credit stood at Rs. 2639 crore constituting 2.42 per cent of ANBC. The Y-O-Y growth of total Agriculture Advances was 30.79 per cent.

iii) Advances to Weaker Sections:

Advances to Weaker Sections stood at Rs.10327 crore as of 31st March, 2013, with percentage to ANBC being 9.49%. The Y-O-Y growth of advances to Weaker Sections stood at 31.37 per cent.

iv) Micro, Small & Medium Enterprises (MSME) and Micro & Small Enterprises (MSE):

In order to focus on MSME segment of advances, the Bank created a separate vertical for MSME during the year 2012-13. The Bank had recorded a healthy growth in MSME and MSE sectors with advances under MSME and Micro & Small Enterprises (MSE) standing at Rs. 20871 crore and Rs. 16421 crore, respectively. The Y-O-Y growth of MSE Advances stood at 22.20 per cent.

v) Minority Community Advances:

Total Minority Community advances of the Bank stood at Rs. 5256 crore constituting 15.03 per cent of Priority Sector Advances, thereby achieving the stipulated target.

vi) Other Activities:

The Bank had put emphasis on Government Sponsored Schemes like PMEGP (Prime Minister a Employment Generation Programme), SGSY (Swarnajayanti Gram Swarozgar Yojana), SJSRY (Swarna Jayanti Shahari Rozgar Yojana), SHG (Self Help Group), JLG (Joint Liability Group), etc.

The Bank''s outstanding credit to Self-Help Groups (SHGs) stood at Rs. 483 crore, with 69877 accounts. 26 Financial Literacy Centres in 26 Lead Districts provided financial education to 30803 persons. The Bank also conducted Financial Literacy programmes for children studying in government schools. During the year, the Bank had set up 1812 Farmers'' Clubs all over the country.

The Bank assisted 3.74 lakh women beneficiaries to the tune of Rs. 5637.41 crore, constituting 5.18 per cent of ANBC as against the RBI norm of 5 per cent.

vii) Initiatives to boost Priority Sector financing:

The Bank had organized a large number of credit camps throughout the country to boost advances under Agriculture and MSE Sectors.

During the year 2012-13, the Bank had entered into MOUs with different organizations like M/s. Mahindra & Mahindra Ltd., Action Construction Equipment Ltd., Gujarat Mahindra Tractor Ltd., HMT Ltd. to lend Commercial Vehicles under MSE and Tractors under Agriculture Sector.

The Bank has launched several new Schemes during the year 2012-13:

1. UCO KISAN BHOOMI VRIDHI Scheme:

The Scheme was launched for financing Small/Marginal farmers, Share Croppers/Tenant farmers for purchase of land for agricultural purpose (Maximum Loan amount Rs.10.00 lac).

2. UCO KISAN TATKAL Scheme:

It has been launched based on the guidelines received from Department of Financial services, Ministry of Finance, Government of India for providing instant credit to the farmers to meet their emergency financial requirements (minimum Rs.1000/- to maximum Rs.50000/-) for Agriculture and Domestic purposes.

3. UCO ESTATE PURCHASE LOAN Scheme:

A new scheme named "UCO Estate Purchase Loan" was launched based on the guidelines received from Department of Financial services, Ministry of Finance, Government of India to extend financial assistance for purchase of Estates growing traditional crops like coffee, tea, rubber, cardamom, cashew nut, pepper, coconut and other perennial crops.

4. Scheme for Solar Irrigation Pump set:

A new scheme named "Solar Irrigation Pumpset" has been launched to extend Financial Assistance to the farmers for purchase of Solar Irrigation Pumpset which is cost effective. The Scheme has been prepared based on the guidelines received from department of Financial Services, Ministry of Finance, Govt. of India to help the farmers in saving their crop from erratic rainfall.

5. UCO KISAN ALL PURPOSE TERM LOAN SCHEME:

The scheme has been formulated for hassle-free single term loan limit to farmers for all term loan requirements. The limit granted shall not be a part of the Kisan Credit Card Limit and it shall be a separate single transaction account, based on the investment plan given by the farmer to be undertaken in next 2- 3 years. The scheme will be a combination of Investment/ development activities relating to agriculture and allied activities.

6. Scheme for relending to individual borrowers having settled their Direct Agriculture loan dues under Compromise/ One time settlement scheme (OTS)/legal action:

To help bona-fide farmers, who are not able to repay their loans in due course, settle their dues under various compromise schemes, Bank has formulated a scheme for relending to individual borrowers (singly or jointly) who have settled their Direct Agriculture loan dues under various compromise/One time settlement schemes/legal action. Fresh loan under the scheme will be considered only for Direct Agriculture activities both for production and investment credit.

7. FINANCIAL INCLUSION

The Bank has adopted 3-way Approach to implement the Financial Inclusion Programme which constitutes;

(i) Opening of Brick & Mortar branches in unbanked villages,

(ii) Launching of UCO Bank on Wheels (Mobile Van)

(iii) Implementation of ICT based BC Model.

During the year 2012-13 the Bank has covered 645 villages each with population below 2000. Further, the Bank has also covered 936 villages under Direct Benefit Transfer (DBT) Programme of Government of India launched from 01.01.2013. Thus the Bank has covered 3284 number of villages as on 31.03.2013 including 1703 villages each with a population over 2000 covered during 2011-12.

Basic Savings Bank accounts to the tune of 25.63 lac have been opened in these villages; out of which 6.25 lac accounts are opened under ICT based BC Model and 240139 no. of Smart Cards have been issued to these customers. Overdraft facility is also built in for the customers in the Basic Savings accounts opened under Financial Inclusion.

The Bank has opened till 31st March, 2013, 19 branches & 763 Ultra Small Branches (UCO MITRA SAKHA) in the unbanked villages in compliance with the guidelines of Government of India on Financial Inclusion. Out of these 763 Ultra Small branches, 178 USBs have been opened in the villages each with a population over 5000.

The Bank has 24 "UCO Bank on Wheels" (Mobile Vans) operating in 12 states. These Mobile vans move to the villages all the six days in a week and offer all banking services as available in a regular branch under CBS environment.

Under Direct Benefit Transfer (DBT) Programme of Government of India, launched from 01.01.2013 in 43 districts, the Bank has presence in 39 districts. Out of 18968 beneficiaries allotted to the Bank in these districts, the Bank opened accounts of all the 18968 beneficiaries.

8. RETAIL BANKING:

The year 2012-13 being the year of Retail business, the Bank focussed on retail business both on asset and liability sides. In this direction, the Bank had came out with several new repackaged liability products both under term deposits as well as in current deposits and, on asset side, made several modifications in existing asset products such as UCO Home, UCO Education, UCO CAR etc. to make the asset products competitive and marketable.

Under liability portfolio, the Bank had launched a new customized Current Account Product titled ''UCO CARE'' to cater to the needs of business class society with add-on facility of overdraft. Further, the Bank launched special repackaged Term deposit schemes to boost growth of term deposits of (< Rs. 5 crore), such as UCO Dhan Varsha (444 days), UCO Double, UCO Triple One, UCO 999, UCO 222, UCO 111 and UCO 66. These schemes had gone very well with the public.

On asset side, besides modifications under UCO Home and UCO CAR, the Bank launched a new Special Educational Loan Scheme titled ''UCO Premier Educational Loan Scheme'' for financing under preferential terms to students securing admission in premier educational institutes of the country.

The retail lending of the Bank had shown a healthier growth of 22.30 per cent during the year 2012-13. UCO CAR registered a growth of 101.04 per cent and UCO Home 17.30 per cent growth.

SL NO. Particulars FY 12 FY 13 GROWTH (In Rs. Cr) Absolute Percentage

(i) Total Retail 7228 8840 1612 22.30

(ii) Home 4235 4968 733 17.30

(iii) UCO Car 384 772 388 101.04

(iv) UCO Education 996 1141 145 14.56

9. BANCASSURANCE:

The Bank showed a y-o-y growth of 29 per cent under Life Insurance business and 52 per cent in non-Life Insurance business. 12 Zones of the Bank was declared as Bima Zones during the year 2012-13.

10. RECOVERY:

The performance of recovery & upgradation in NPA accounts during the FY 2012-13 has substantially improved over the previous years. The Bank has undertaken vigorous recovery efforts in NPA accounts for early recovery in the accounts and there has been substantial improvement in the recovery and upgradation during the current FY over the previous two years.

Particulars 31.03.2011 31.03.2012 31.03.2013

Cash Recovery 434 658 828

Upgradation 226 417 673

Total Redemption 660 1075 1501

However, the gross NPA as on 31.03.2013 of the Bank has increased to Rs.7130 crore from Rs.4086 crore as on 31.03.2012 and this is mainly due to the slippage of a large number of borrowal accounts to NPA in the FY 2012-13, particularly some high value group accounts. This sudden slippage is mainly due to the effect of global recession which affected domestic economic activity also to a large extent; and large projects could not either be completed or generate sufficient cash flow as anticipated, hence failed to fulfil their repayment obligations to the Bank. Similarly, SME accounts also got affected badly. The sudden slippage has resulted in increase in GNPA/NNPA Ratios in the FY 2012-13 as compared to the FY 2011-12.

(Rs. in Crore)

SL. NO. Parameter FY 12 FY 13

(i) (%)/Gross NPA (%) 3.48 5.42

(ii) Net NPA (%) 1.96 3.17

(iii NPA Provision Coverage Ratio (%) 54.39 52.08

Committee approach for follow-up & monitoring of recovery in NPA accounts.

In order to strengthen the monitoring mechanism of recovery, a Committee approach was adopted by the Bank.

i) In terms of the direction of Ministry of Finance, DFS, GOI, Board Level Committee has been constituted in the Bank where CMD, EDs & Govt. nominee Director are members of the Committee for monitoring of recovery Performance of NPA accounts. Progress of recovery in all such NPA accounts is being monitored by the Committee periodically and the report being submitted to the Board accordingly.

ii) For monitoring/follow-up of high value borrowal accounts in regard to the recovery and prevention of fresh slippage, a Committee comprising of five Corporate GMs was set up at HO level, and the Committee is meeting on weekly basis.

iii) Committees were also constituted at Zonal & Circle Office level for effective monitoring of recovery in NPA accounts as well as for containment of slippage.

iv) For effective monitoring of the recovery performance in technically written-off accounts a Task Force/dedicated team at HO level is formed consisting of a DGM, AGM, CM and 4 other officers for close follow up with the circles regarding the development of recovery in such accounts.

v) Bank extended the modified compromise settlement scheme for small NPA/ML accounts with outstanding balance up to Rs.10 lac during the FY 2012-13 to give benefit to the small NPA borrowers and thus recovered through this channel Rs. 58.78 crore in FY 2012-13 as against recovery of Rs. 34.96 crore in corresponding period of last year. Bank also introduced a separate scheme for compromise settlement in MSME borrowers.

Various other recovery measures that have been adopted by the Bank for boosting Recovery in NPA/ML accounts and bring down the GNPA of the Bank include:

- Immediate initiation of action under SARFAESI Act where the unit is not viable after the account becomes NPA in all eligible accounts followed by taking possession and auction sale of the property(ies).

- Filing of Recovery suits in DRT/Civil courts and identification & declaring borrowers with outstanding balance of Rs. 25.00 lac and above as ''Willful Defaulters'' as per RBI guidelines.

- Monitoring and follow up in regard to development in each account with balance of Rs. 5 crore and above with the Circle Offices on fortnightly basis through video conference.

- Close follow-up of all NPA A/cs of Rs. 1 Crore & above by Circle Heads of Chennai, Kolkata & Mumbai and Rs.50 Lac & above by Circle Heads of other Circles.

- Decreed cases, where details of assets of Borrowers / Directors & Guarantors are not available, to be handed over to reputed Detective Agencies for identification of their assets within the stipulated time schedule.

- Steps for timely execution of Decrees issued by the Court / Certificate of Recovery issued by the DRTs through Recovery Officers of DRTs.

- Number of Asset Management Branches (AMBs) of the Bank were increased to eleven from earlier five for effective monitoring and follow up of NPA accounts through the specialized branches across the country.

11. CREDIT MONITORING:

In order to be proactive in monitoring of all borrowal accounts on real time basis, the Bank has put in place a robust System to generate reports on Dues and sensitized all concerned to start follow up from Day one, Intensify after 30 days and get regularized within 60 days.

For hassle-free monitoring and follow up of all big borrowal accounts for Rs. 1 crore and above under stress, the Bank takes the leverage of the system in generation of one customized Report (CCMR) containing Financial and Non-Financial irregularities/ deficiencies, in addition to few other regular Reports available every month. To further accentuate the thrust on maintenance of asset qualities, meeting with borrowers by the branch and other field functionaries is being ensured.

Realising the importance of Credit Audit in ensuring the quality of assets, the Bank has identified 1345 borrowal accounts during 2012-13 for Credit Audit. Audit reports for the previous years from 2009-10 to 2011-12, barring a few for 2011-12 have since been closed during 2012-13.

To safeguard the security interest of the Bank, the Bank registered all cases numbering more than 1.30 lac pertaining to the period before 01-04-2011 with CERSAI. Security Interest created on or after 01-04-2011 is being registered with CERSAI on an ongoing basis.

12. RISK MANAGEMENT:

During the year 2012-13, the Bank has put in place several new initiatives in the area of Risk Management. Implementation of Advanced approaches under Basel II is in progress. Diagnostic Gap study in all the risk areas has been completed and separate Market Risk Management policy has been put in place. CIBIL helpdesks in all Zones have been formed, CIBIL workshops involving all Nodal officers of Zones and Circle offices along with Branch officials have been conducted. The percentage of credit data acceptance by CIBIL and pulling of CIBIL reports have increased substantially. CIBIL reports pulled has increased from 19 per cent as on March 2012 to 78 per cent as on March 2013. In absolute terms the number of CIBIL reports pulled has increased five fold from 3370 in the month of March 2012 to 15741 in the month of March 2013.

13. REGIONAL RURAL BANKS:

Of the five RRBs sponsored by the Bank as at the end of March, 2012, the Bank has two RRBs namely, Bihar Gramin Bank and Paschim Bangla Gramin Bank as on 31.03.2013.

Two important developments that took place in the year 2012-13 in terms of decision of the Government of India were namely, amalgamation of the RRBs as well as recapitalization of RRBs.

(I) Amalgamation of RRBs:

The amalgamation, thus, effected during the year are as detailed below:

- In the state of Madhya Pradesh, Mahakaushal Ksh. Gramin Bank was amalgamated with Satpura Narmada Gramin Bank and Vidisha Bhopal KGB to form Central Madhya Pradesh Gramin Bank under the sponsorship of Central Bank of India w.e.f. 08.10.12.

- In the state of Bihar the erstwhile Bihar Ksh. Gramin Bank & Samastipur Ksh. Gramin Bank got amalgamated to a single RRB as Bihar Gramin Bank w.e.f. 15.10.12 under the sponsorship of UCO Bank.

- In the state of Odisha, Odisha Gramya Bank is formed on amalgamation of Kalinga Gramya Bank, Neelachal Gramya Bank and Baitarani Gramya Bank under sponsorship of Indian Overseas Bank w.e.f. 07.01.13.

- In the state of Rajasthan, Jaipur Thar Gramin Bank has been amalgamated with Marudhara Gramin Bank to form a new entity as Marudhara Gramin Bank under the sponsorship of State Bank of Bikaner & Jaipur w.e.f. 25.02.13.

(II) Recapitalisation of RRBs:

Paschim Banga Gramin Bank has been recapitalised during the period 2012-13 to the tune of Rs. 25800 lakh in the ratio of 50% by Government of India, 35% by Sponsor Bank and 15% by State Government amounting to Rs. 129.00 crore, Rs. 90.30 crore & Rs. 38.70 crore, respectively. Thus the total amount of recapitalisation of PBGB at present stood at Rs. 153.01 crore (Government of India), Rs. 107.11 crore (Sponsor Bank) & Rs. 45.90 crore (Government of West Bengal). Similarly, Bihar Gramin Bank had already received amounts of Rs. 107.07 crore (Government of India), Rs. 74.95 crore (Sponsor Bank) & Rs. 32.12 crore (Government of Bihar).

Performance of RRBs (Unaudited):

The total number of branches of the Bank''s two sponsored RRBs stood at 487 as on 31.03.2013. The total deposits of two RRBs have increased from Rs. 4927 crore as on 31st March, 2012 to Rs. 5476 crore as on 31st March, 2013; thereby showing a growth of Rs. 547 crore or 11.15 per cent. The total advances recorded a growth of 23.94 per cent or Rs. 445 crore from Rs. 1859 crore as on 31st March, 2012 to Rs. 2304 crore as on 31st March, 2013. The C-D ratio of the RRBs improved from 37.74 per cent as on 31st March, 2012 to 42.08 per cent as on 31st March, 2013.

The gross NPAs of the RRBs was Rs. 154 crore as on 31st March, 2013 vis-a-vis Rs. 153 crore as of 31st March, 2012. The gross NPA ratio, however, reduced from 8.27 per cent as on 31st March, 2012 to 6.67 per cent as of 31st March, 2013. The net non- performing assets ratio (NNPA) of the RRBs as on 31.03.2013 stood at 3.59 per cent.

Bihar Gramin Bank recorded a net profit of Rs. 41.05 crore after having wiped out its accumulated losses. Paschim Banga Gramin Bank also reported a net profit of Rs. 2 crore vis-a-vis the loss incurred over the previous year.

13. INFORMATION TECHNOLOGY:

After the migration of all its domestic branches into CBS, way back in March 2010, the Bank has migrated two of its overseas branches in Hong Kong centre to CBS-Finacle on 4th Feb 2013 successfully. A separate helpdesk is formed at Head Office for providing continuous support to Hong Kong users. The Bank is in the process of migrating two other branches in Singapore centre to CBS shortly.

The Automated Data Flow (ADF) project, is a regulatory project wherein the MIS data pertaining to the Bank are presented as per formats finalised by RBI. Automated data flow ensures submission of various reports to the regulator without any manual intervention from Bank. The Bank is in the advanced stage of implementation of the project.

Online filing and tracking of loan applications was introduced by the Bank through its website. Facility for online filing of applications, MSME scheme and selected retail products are being made available through Bank''s Website. Customers can submit loan application online and track status online.

Government pension for the treasuries such as CPAO, Defence, Telecom is being paid centrally from CPPC Nagpur Branch. Centralised payment of pension for railways is being explored. Pension for State Govt depts. are paid from various branches. Payment of West Bengal state tax has been introduced in GBM (Counter Payment). New Pension Payment Module has since been implemented.

As an additional safeguard Bank has introduced a second factor authentication mechanism to login to CBS - Finacle. All staff are now required to authenticate themselves through finger print based authentication in addition to their user-id and password to gain access to Finacle software.

As of 31.03.2013, credentials of around 10,000 users are enrolled under Biometric authentication covering 1275 branches. 2200 fingerprint scanner devices delivered and installed in 239 branches. Another 2000 devices are being installed. Integration is completed with Finacle and has been made operational.

The Bank has implemented Cheque Truncation System (CTS) in NCR, Delhi from 2007. Later NPCI has expanded the project to Southern States such as Kerala, Tamilnadu, Karnataka, Andhra Pradesh & Pondicherry. Later centres like Kolkata, Chandigarh and Ludhiana were also added to the southern grid. The highlights of CTS implementation in the southern grid include:

- 17 out of 26 MICR centres across five southern states and Kolkata, Ludhiana & Chandigarh centres are participating in CTS Southern Grid.

- Out of the remaining 9 MICR centres, 5 centres are ready to be migrated to CTS and the migration is expected to be completed by 2nd week of April 2013. Site readiness for remaining 4 centres is in-process.

- NPCI has initiated CTS implementation in the Western grid. System Integrator has been identified to implement Grid CTS in the Western Grid. The project is expected to commence shortly.

The Bank had earlier connected all its branches using point to point leased line network in order to bring all the branches under CBS. To take advantage of the fault tolerant architecture offered by Multi Protocol Label Switching (MPLS) networks, the Bank has moved all its branches to MPLS network offered by BSNL. In addition to the Finacle software various other applications such as Video conference system are extensively used in the Bank using the MPLS network.

The in-house development team of the Bank has developed and deployed following two application software in production environment during the year 2012-13:

(1)Online Computer literacy test, first of its kind in the Bank was successfully conducted on 24.06.2012, as a part of promotion process from scale III to IV and from scale IV to V. Around 600 candidates across the country, involving 34 Inland Centers and two Overseas Centers have taken part in the test. (2) Online PAR Management System: Online PAR Management System has been successfully implemented for submission of APAR for all officers. This will enable submission of PAR (Performance Appraisal Report) online and evaluation online.

14. OPERATIONS & SERVICES:

i) Know Your Customer (KYC) & Anti-Money Laundering (AML):

During the year 2012-13, the Bank continued to focus on strengthening of KYC compliance and overseeing the Anti-Money Laundering (AML) activities. During the year, the Bank made System based KYC compliance through KYC (#) menu in CBS system. The installation of AML software for daily processing and monitoring of all transactions in the Bank to generate (a) Suspicious Transaction Reports (STRs) and (b) Cash Transaction Reports (CTRs) has been streamlined further and the Bank is able to effectively process and monitor all transactions particularly through new alerts. CTRs, STRs, CCRs and NIRs had been submitted regularly to FIU-IND, New Delhi.

ii) Customer Service:

Towards improving the Customer Service in the Bank, dedicated branches were identified for exchange of soiled notes and distribution of coins. Further, an independent RTGS-NEFT Cell has been created at Mumbai. The Bank continues to be committed in maintaining best customer service and keeps on aligning its practices in line with customer expectations, through continued process of review and evaluation.

The executives of the Bank, during the year 2012-13, interacted with the customers of the Bank at frequent intervals of different centres across the country at all tiers viz. Head Office, Circle Office, Zonal Office and branches through meetings of different Committees consisting of Customer Members, to have complete feedback and understanding of needs and grievances of the customers of the Bank. The meetings of Standing Committee on Customer Service at Corporate level of the Bank under the chairmanship of Executive Director were held as per schedule and were attended by Senior Executives of the Bank as well as customer representatives. Apart from this, Nodal Officers had been appointed at all the Zonal Offices to take care of customer grievances. Through adoption of effective grievance redressal mechanism the Bank was able to redress more number of grievances during this fiscal year than the previous one.

Transparency had been maintained by the Bank by hosting on Bank''s website the documents relating to (i) Policy on Customer Grievance Redressal, (ii) Cheque Collection, (iii) Compensation, (iv) Collection of dues and repossession of security.

iii) Right to Information (RTI) Act:

In terms of Right to Information (RT) Act, Bank''s commitments towards customers are well defined and published in the Bank''s website. The Bank is in continuous process of strengthening of review under Right to Information (RT) Act. The Bank had designated Central and Zonal Nodal Officers to cater to the queries of different customers and other stakeholders regarding RTI matters. Names and contact details of nodal offiers are mentioned in the Bank''s website. As per RTI Act 2005, the Bank has appointed 41 PIOs and APIOs, one at each Zonal Office level and two CPIOs and two CAPIOs at Head Office level to facilitate disposal of RTI applications seeking information and one Appellate Authority at each Circle Office and Head Office for disposal of appeals filed under their jurisdiction.

iv) New Pension Scheme (NPS) :

The corporate model of New Pension Scheme (NPS) has been operationalised by enabling the Personnel Services Department of the Bank to bring all Bank''s new recruits (since 01.04.2010) into the New Pension Scheme fold. The Bank has been registered as POP with PFRDA under ''Swavalamban'' (New Pension Scheme). Further, the Bank has been registered as a Corporate with PFRDA under New Pension Scheme as also with NSDL as Oversight Office.

v) Other Activities:

The Bank has successfully completed CTS - Southern Grid implementation in the year 2012-13. The Bank has also received authorization (Accredition by Govt. of India) for CPPC, Nagpur to act as a Single Window System for Payment/Disbursement of Central Civil Pension, Defence Pension, Postal and Telecom Pension. Further, tax collection of Govt. of West Bengal, both online and offline have been made GRIPS-enabled.

The Bank has started two new Clearing Houses at Mecheda and Barakar centres. During the year 2012-13, all 72 Currency Chests branches of the Bank have been made Bio-metric Access Control- enabled. The Bank has also installed 174 Account vending machines in line with RBI guidelines for catering to the general needs of the public. Further, high capacity note sorting machines were also installed in all 72 Currency Chest branches and also at 60 identified non-Currency Chest branches having daily cash receipt of Rs. 50 lakh and above.

15. CORPORATE COMMUNICATION:

With the aim of bringing about a quantum shift in the field of customer communications, the Bank, under the supervision of its Corporate Communications Department had taken up a number of initiatives through various channels namely electronic media, print media, internet, sponsorship, outdoor media, etc.

Publicity Campaigns:

- Campaigns in Print Media:

During the year 2012-13 vigorous publicity campaigns were launched in leading national and regional newspapers for mobilization of CASA deposits, Festival Bonanza scheme on Home & Car loans, launching of Customer-centric products such as UCO Double, UCO Dhan Varsha, UCO Triple One, UCO Triple Nine, UCO Triple Two, UCO Kisan Rupay Card, UCO Tax Saver Deposit Scheme, UCO 66, UCO CARE - Current Account. The Bank also conducted extensive publicity campaign on Gold Loan and e-banking products.

- Radio Jingles and Television Commercials:

In order to boost Bank''s brand image, and to propagate product information among the target customers, radio jingles were released through different radio stations. Intensive publicity on e-banking products was also done by way of television commercials on various news channels. Our bank received good publicity mileage out of all these publicity campaigns carried throughout the year.

- Rural Publicity:

As the Bank has a good number of branches in rural area, Corporate Communications Department through different Zonal Offices has conducted rural publicity campaign across the country. In order to extract maximum publicity mileage, the Bank has also participated in various rural fairs and festivals as sponsor.

- Customer Meets:

Since customers are of paramount importance to the Bank, a number of customer meets have been organized from time-to- time by all Zones and Circles. Corporate Communications Department at Head Office took the initiative to co-ordinate with all Zones and Circles for arrangement of such meets at regular intervals.

- Awards:

Internal Communication plays a vital role in transmitting messages in respect of Bank''s overall functioning and other relevant information among employees of the Bank. The Bank''s house journal, UCO Tower has been playing a key role in this aspect. The house journal has established itself as one of the effective conduits for spreading Bank''s Vision and Mission, as is evident from the fact that it has been awarded the Certificate of Merit at ''ICE Awards'' (In-House Communication Excellence), 2012 initiated by Shailaja Nair Foundation, Mumbai.

- Celebration of 71st Foundation Day:

In keeping with the tradition, the Bank during the year celebrated its 71st Foundation Day with the main function held at Science City Auditorium, Kolkata. To mark the occasion, the Bank planned to reach out to citizens at large and undertook some new customer centric initiatives. The Bank''s branded tableau was flagged off from Head Office and it moved across different places in and around Kolkata touching designated branches. Pamphlets on CASA, Retail loans with the prime focus on educating the people on Bank''s different products and services were distributed from the tableau. On the same day, towards fulfilling social commitments, the Bank handed over education kits to 70 specially abled children. To mark the anniversary celebration, the Bank made a donation of Rs. 10 lac in favour of Ramkrishna Sarada Mission Sister Nivedita Girls'' School for underprivileged girl children.

16. CORPORATE SOCIAL RESPONSIBILITY:

The Bank believes that carrying out Corporate Social Responsibility (CSR) helps in tangible value-creation. Moreover, CSR, creates a positive image in the society and inculcates essence of loyalty for the Bank among a cross-section of countrymen.

In tune with this perception, the Bank made separate donations for deserving as well as noble causes during the year.

- An amount of Rs. 4.90 lakh to Shivaji University, Kolhapur, Maharashtra under environment protection category for installation of Solar Plant Device.

- Rs. 2 lakh to Ramakrishna Math, Nattarampalli, Vellore, Tamilnadu for construction of building for an orphanage.

- Rs. 10 lakh to Mahaveer Viklang Sahayata Samity, Jaipur for helping the physically challenged.

- To facilitate education & women empowerment a sum of Rs. 10 lakh was donated to Ramakrishna Mission Sister Nivedita Girls'' School.

- Rs. 6 lakh to Rajiv Gandhi Foundation, New Delhi for purchasing vehicles with disabled-friendly attachment.

- Rs. 10 lakh was extended to Chief Minister''s Relief Fund, Sikkim for assistance during natural calamity.

- Under health care category Thalassaemia Society of India was provided with Bank''s donation of Rs. 6 lakh for treatment of Thalassaemic children belonging to BPL category.

- A van costing Rs. 7.90 lakh was donated to Disha Foundation, Jaipur for the physically and mentally retarded.

- Rs. 5.00 lakhs as donation was awarded to Kharda Janakalyan Rognirnoy Kendra, Kharda for running a diagnostic clinic for the weaker sections.

17. HUMAN RESOURCE MANAGEMENT:

MANPOWER

The total Staff Strength of the Bank as on 31st March, 2013 stood at 24,201, including 106 employees serving overseas, 14 of which are expatriate officers. The total domestic staff strength of 24,095 comprises of 10,807 Officers, 8,768 Clerks and 4,520 Subordinate staff.

The percentage of Scheduled castes (4809) and Scheduled Tribes (1355) in the total domestic staff strength is 25.58. Besides there are 1759 OBC employees in service of the Bank at the end of FY 12-13 and 1192 employees belong to Minority Communities. Out of the total work force 16.16 percent constitutes women employees as of March, 2013 compared to 14.33 percent in 2012.

During the year 2012-13 initiatives were taken by the Bank for development of SCs, STs, OBCs, Persons with Disabilities, Ex- Servicemen and Women; and pre-promotion/recruitment trainings were imparted to SC/ST candidates as per Government of India directives.

RECRUITMENT

A total number of 1791 Officers have been recruited during the year 2012-13 including 258 SCs, 105 STs and 477 OBCs. 575 of these Officers are Women, 26 are Persons with Disabilities and 82 belong to Minority Communities. 592 Clerks have also been recruited during the year 2012-13. These include 87 SCs, 53 STs and 167 OBCs, 30 Ex-Servicemen, 35 persons with Disabilities and 27 persons belong to Minority Communities. Moreover, the Bank has also initiated the process of recruitment for 1000 Clerks, 1000 Probationary Officers and 200 Specialist officers during the year 2013-14.

PROMOTIONS

During the year, 4 Executives were promoted to Top Executive Grade scale VII, 14 Executives were promoted from Scale V to Top Executive Grade Scale VI and 36 Executives were promoted from Scale IV to Scale V. Besides, 229 Officers were promoted to Scale IV, 675 to Scale III and 357 to Scale II. In addition, under specialist category, 8 Officers were promoted from Scale III to Scale IV, 27 Officers were promoted to Scale III and 19 Officers to Scale II. Further, during the period, 690 Clerical Staff were promoted to Officers Cadre and 257 Sub-ordinate Staff were promoted to Clerical Cadre.

INDUSTRIAL RELATIONS

During the period, the Industrial Relations climate in the Bank remained healthy and cordial between the Management and the Unions/Associations. IR meetings and discussions were held with Unions/Associations at periodic intervals sharing co-operative attitude and mutual respect during the financial year 2012-13.

PERSONNEL SERVICES

During the year 2012-13, several new Schemes were Implemented by the Bank under Staff Welfare Scheme which include

- Assistance by way of reimbursement of expenses on account of Health Check-up enhanced to Rs. 2,500/- from Rs. 1,500/- for employees and Rs. 1,500/- from Rs. 1,000/- for spouse - every year instead of earlier rule of once in two years. For employees, age criterion has also been reduced to 30 from 40.

- Coverage under Group Mediclaim Insurance Scheme for Retired Employees with Spouse has been enhanced from Rs. 1 lac to Rs. 2 lac on floater basis.

- Three Holiday Homes for Inservice as well as Retired employees have been started at SHIRDI, TIRUPATI and MUSSOORIE.

- CANTEEN SUBSIDY @ Rs. 250/- per employee per month is being disbursed to all employees across the country from January 2013.

- Reimbursement of further Hospitalization Expenses against uncovered Hospitalization Bills with a maximum limit of Rs.

25,000/- in case of Retired employees & Rs. 10,000/- in case of Spouse of Retired employees in connection with treatment of Heart Surgery, Brain Tumor, Kidney failure, Cancer & major Surgery in the event of any accident has been initiated.

- Lump sum Financial Assistance of Rs. 5,000/- every month to the Pre-1986 Retirees has been introduced.

- Bank started Centralized payment of pension to the staff pensioners w.e.f. November, 2012 through the Staff Pension Processing Centre of Personnel Service Department.

TRAINING

During the financial year 2012-13, more emphasis was given on training by the Bank. A separate vertical as Training Department had been created. One of the major highlights, during the year 2012-13, was delegation of authority and association of Circle and Zonal Offices in training of staff members upto Scale-III. The focus was on locational training to be conducted at branch level. Further, Camp Training was also given focus to be conducted at convenient centres to be decided by the Circe Heads. The Board of Directors has approved the decision for setting up of five new Regional Training Centres by the Bank.

During the year 2012-13, 8167 officers and 750 clerks were given class-room training. 263 Executives & Officers were nominated for different training at apex Training Institutions of India like NIBM, CAB, BIRD, IIBF, IIBM, NIRD, IDRBT, IIM Indore & IIM Lucknow, etc. 6 Officers were sent for overseas training & exposure. 5427 Officers, 1373 Clerks & 210 Sub-staff (Total 7010) have been imparted need-based training locationally. Training on Specialized Subjects like vigilance on public procurement, Disciplinary Proceedings, Security Officers, Forex Business, Inspecting Officers have been organized at Central Staff College, Kolkata. Managers Handbook and Handbook on Retail Loan Products have been published by CSC, Kolkata & RTC. Bhubaneswar. Incompany Training Programmes have been organized for Executives at ASCI-Hyderabad & IIM - Indore, for Faculty Members at NIBM-Pune , for Branch Heads at IIBM-Guwahati & NIRD-Hyderabad.

18. AUDIT & INSPECTION:

The Bank has a well-established Audit and Inspection Department that examines adherence to the Systems and Procedures. Bank has a comprehensive Inspection and Audit Policy for undertaking Internal Inspections, Concurrent Audit, Revenue Audit, Risk Based Internal Audit, and Information System Audit. The guidelines received on various issues of Internal Control from Reserve Bank of India, Government of India, Board and Audit Committee of the Board have become part of the internal control system for better risk management.

During the year 2012-13 the Bank has given focussed attention to close overdue inspection reports outstanding for more than 3 months by rectification of major & other irregularities. As a result of impetus given by the Bank there was no Annual Financial Inspection Report pending for closure as on 31st March, 2013. The regular branch inspection report is the most comprehensive feed-back to the management about compliance of the Bank''s systems and procedure and guidelines at operational level.

One of the major achievements during 2012-13 was that out of total revenue leakage of Rs. 46.60crore, Rs. 40.98 crore was recovered on the spot by internal/external auditors concerned.

19. VIGILANCE:

The Bank believes in adopting a Positive Approach in Vigilance Administration. During the year, emphasis was given to sensitizing the staff, mainly the new entrants with Vigilance measures in day to day operations. For this a number of Workshops & Training programmes were held at various centres.

With consistent follow up, the number of RDA cases reduced considerably except in matters where proceedings have been stopped by the intervention of Court/Police.

The earlier CVO, completed his tenure on 2nd November 2012 and a new CVO has been appointed. He took over on 18th February 2013.

There was a review of Vigilance functioning of the Bank by CVC in the month of March 2013.

20. MANAGEMENT AUDIT AND HR AUDIT:

In terms of the extant guidelines of the Bank, all the Corporate Departments, Circles Offices, Zonal Offices and Field Inspectorates are put to Management Audit once in every two years. The Bank has successfully conducted Management Audit in 18 Zonal Offices, 2 Circle Offices, 7 Field Inspectorates and one Corporate Department during the period from 01/04/2012 to 31/03/2013. The Reports have been closed in all eligible cases after getting the irregularities rectified by the Authorities concerned.

A snap Audit of the Transfer Policy being handled by HRM was conducted as instructed by the Competent Authority. H R Audit(assessment) of 8 Zonal Offices and 4 Circle Offices were conducted.

21. COMPLIANCE OF OFFICIAL LANGUAGE POLICY:

The Bank has taken proactive steps to implement the Official Language Policy of Govt. of India and has meticulously taken steps to comply with the provisions of Official Languages Act and the Rules made there-under. The Bank has also taken appropriate follow-up action to implement the directives as contained in the Annual programme with regard to the use of Official Language Hindi issued by Government of India, Ministry of Home Affairs, Dept. of Official Language and also endeavoured to achieve various targets prescribed in the said programme. Bank has also given preferred attention to comply with the instructions of Financial Services Department, Ministry of Finance and Reserve Bank of India regarding the use of Hindi in official work.

Sixty Nine Hindi Workshops were organised by the Bank for the Officers and employees to motivate them to do their work in Hindi. Total 1451 Officers / employees were trained through these Hindi Workshops. In view of the directives of Govt. of India to promote ''UNICODE'' application on all the computers, a session was allotted in these workshops to acquaint all Officers and employees with its application and activation.

481 branches were inspected by Official Language Officers posted at different Zonal offices, 3 Circle Offices, 9 Zonal offices.

One Regional Training Centre and four departments of Head Office were also inspected by Official Language Officers posted at Head Office during the period under review to evaluate the performance in the area as of implementation of Official Language Policy of Govt. of India. Necessary remedial measures were also taken to remove the deficiencies observed in such inspections.

During the period under review a National Seminar on the subject "Rajbhasha Implementation - Role of the executives" was successfully organized by the Bank on 17th May, 2012 in Kolkata. Prizes were also distributed to the winner of the Inter-bank and Intra-bank Hindi Essay Writing Competition organized by UCO Bank on the subject "Rajbhasha Implementation - Role of the executives" in this seminar.

In view of the requirement to accelerate the pace of implementation and effective compliance of Official Language Policy of Govt. of India in the Bankm 17 more Official Language Officers were recruited during the period under review.

On the occasion of "HINDI MONTH" celebration at Head Office a grand cultural evening was organized by the Bank in Science City Auditorium at Kolkata. Eminent Hindi poets from various cities of the country viz. Shri Surendra Sharma, Smt. Sita Sagar, Shri Ved Prakash, and Shri Sampat Saral recited their poems and songs in two sessions in this programme. Shri Ajoy Roy of Kolkata also presented songs penned by popular Hindi lyricists and poets. Dr. Amit Kumar Verma and Dr. Ravindra Kumar Das accompanied him on Tabla & Synthesizers. The programme was inaugurated by the CMD of the Bank. All the executives of the Bank posted at Kolkata, Howrah and Salt Lake and a large number of our valued customers along with their families were present on this occasion.

Zonal Offices, Jaipur, Raipur, Mumbai, Indore, Jodhpur, Ahmedabad, Ranchi, Pune and Bhopal have published Hindi e- magazines during the period under review.

The Bank successfully organised various competitions, rendered editorial assistance to other Public Sector Banks & Financial Institutions in conducting ''HINDI UNICODE WORKSHOP'' & ''Hindi workshop'' under the auspices of different TOLIC''s.

Various forms / publicity materials / procedural booklets and report of Annual General meeting of Shareholders, Manual of Instructions, Minutes of various Board Committees were prepared in bilingual form. Hindi text of the materials for our Bank''s Website was also prepared. Sufficient amount was allocated by the Bank for the purchase of classic literary Hindi books, dictionaries, technical glossaries, Hindi books on computer/banking, etc. and famous literary books in regional languages written by renowned litterateurs.

In view of effective monitoring of the work with regard to the use of Hindi in official work, the position of our Bank was vividly reviewed in the meetings of Apex Official Language Implementation Committee of the Bank.

"Hindi Month", "Hindi Fortnight", "Hindi Week" was celebrated enthusiastically at Head Office as well as Zonal Offices, Central Staff College, Regional Training Centres and Branches.

During the period under review Zonal Office, Patna and Zonal Office, Jalandhar were awarded 1st Prize / Shield and Zonal Office, Ranchi and Zonal Office, Dharamshala were awarded 2nd Prize respectively by TOLIC Patna, Jalandhar, Ranchi and Dharmashala.

Jt. Director (O.L.), Govt. of India, Ministry of Finance, Financial Services Dept., New Delhi inspected the Bank''s Head Office on 11th July, 2012 in respect of implementation of Official Language Policy in the Bank and expressed his satisfaction to observe the steps taken by the Bank for augmenting the use of Official Language Hindi in official work. In addition, on 18th July, 2012 the Dy. Director (Imp.), Govt. of India, Ministry of Home Affairs, Regional Implementation Office (East), Kolkata also reviewed the position of compliance of various aspects of the Official Languages Act and Official Languages Rules at the Head Office of the Bank on the basis of the Quarterly Progress Report for the quarter ended 31st March, 2012 submitted to them.

22. COMPLIANCE:

The Bank has emphasized on compliance issues as mandated by RBI. The Bank had ensured the level of customer service, functions and rules of deposit, advance, KYC/AML, other services, prompt submission of statutory/regulatory reports, information and data asked by RBI, GOI, etc. through a strict compliance system. Compliance Policy has been revised, reviewed and the same is being placed for approval of the Board of Directors in its meeting scheduled to be held on 10.4.2013. The revised Compliance Policy has been prepared incorporating necessary changes to prevent breaches in the areas of compliance functions. Compliance testing of operations at branches was introduced during the year 2011-12 to render deficiencies observed and rectified them on the spot to improve operational efficiency. Critical issues were reported and discussed at the appropriate level to enhance efficacy of the system.

23. Legal Matters

The Bank had delivered legal advice on various matters referred to it by all sections of stakeholders. The Bank had focused on the expeditious disposal of such matters for enhancing the efficiency of operational tiers. To ensure this, a continuous Monitoring System was in place. The Bank had extended its legal service to cater to the need of recovery issues, personal and industrial disputes filed by different sources, premises matters, legal audits, documentations, tribunal requirements, Ombudsman Compliance, etc. Empanelment of good lawyers was done successfully to set and maintain benchmark for legal issues.

24. FUTURE PLAN:

During the year 2013-14, the Bank will further strengthen its retail base, both on liability and assets sides. The Bank shall continue to focus on retail advances such as, ''UCO Home'', ''UCO CAR'', ''UCO Education'' and ''UCO Gold Loan''. Besides, the Bank will continue to lay emphasis on Priority Sector Advances with focus on Direct Agriculture and MSE. The endeavour of the Bank shall be to reduce its dependence on bulk deposits and advances further during the course of the current year 2013-14. The Bank will be strengthening its delivery channels by opening at least 400 branches to touch the Bank''s branch network to 3000 branches by the end of March, 2014 as also to double the number of ATM which will increase the Bank''s alternative delivery channel network.

The Bank''s focus on customer acquisition will further be increased by targeting at least 40 lakh new CASA accounts by March, 2014.

To sum up, the year 2013-14 shall be the ''Retail Business Year'', second time in succession.

25. BOARD OF DIRECTORS:

Corporate Governance

The Bank firmly believes in and has consistently practiced good corporate governance which is woven around its core values of transparency, professionalism and accountability. By constantly focusing on these aspects in its day-to-day operations, the Bank strives to enhance shareholders'' value. The Bank being committed to the principles of good governance, its Board of Directors has formed various committees of the Board to monitor every aspect of Bank''s business. The systems and business processes of the Bank are continuously reviewed at various levels for identifying and strengthening areas of weaknesses, if any. The Directors of the Bank believe that good governance is the key to earning trust, loyalty and goodwill of clients, business associates, employees and investors and respect from the society at large.

Changes in the Board of Directors

Smt. Uma Shankar served as the RBI nominee Director in the Board from 30.07.2010 to 06.09.2012. With effect from 06.09.2012, Shri B.P. Vijayendra has been appointed as RBI nominee Director.

Shri R. A. Sharma served as the Workman Employees Director in the Board from 15.02.2010 to 14.02.2013. With effect from 15.02.2013, Shri Partha Chanda has been appointed as Workman Employees Director.

Shri Diptendra Narayan Thakur was appointed as Officers'' employee Director in the Board w.e.f.12.12.2012.

Meetings of the Board of Directors

During the financial year 2012-13, the Bank had 14 meetings of the Board of Directors, 19 meetings of the Management Committee of the Board, 8 meetings of the Audit Committee of the Board. The number of meetings of various other Committees of the Board held during the year 2012-13 is given below:

Sl No. Name of the Committee No. of Meetings held

1. Risk Management Committee 3

2. Shareholders'' Grievance Redressal Committee 1

3. Share Transfer Committee 8

4. Special Committee for Monitoring Large-value Frauds 3

5. Customer Service Committee of the Board 4

6. Committee on HR-related issuesof the Bank 2

7. Nomination Committee of the Board -

8. Remuneration Committee of the Board 1

9. Committee of the Board on IT Management 4

Statement of Directors'' Responsibilities

The Directors confirm that in the preparation of the annual accounts for the year ended March 31, 2013, 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 Reserve Bank of India, were consistently applied. Reasonable and prudent judgements and estimates were made so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit of the Bank for the year ended March 31, 2013. 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 an on-going basis.

Acknowledgements

The Board of Directors places on record its deep appreciation of the contributions made to the deliberations of the Board by outgoing Directors namely, Smt. Uma Shankar,and Shri R.A.Sharma. The Board would like to welcome the new Directors and looks forward to their valuable inputs towards growth of the Bank. The Directors remain thankful to the Government of India, Reserve Bank of India and other regulatory authorities for their support and valuable guidance. The Board also thanks other Financial Institutions and correspondent banks for their sincere co-operation. The Directors express their gratitude to the loyal customers for their trust and continuous patronage of the Bank. The Board also thanks the Staff Unions/Associations and shareholders of the Bank for the support extended by them. The Directors place on record their deep appreciation of the dedication shown by each employee of the Bank due to which the Bank could achieve so many milestones.

For and on behalf of Board of Directors,

Dated: 07th May, 2013 (Arun Kaul)

Place: Kolkata Chairman & Managing Director


Mar 31, 2012

1. BUSINESS PROFILE:

During the year 2011-12, the Bank showed a respectable growth in all the business parameters. Advances figures had shown a steady upward growth with global advances growing by 16.85 per cent during the year 2011-12 to reach the level of Rs 117504 crore as of March, 2012 from Rs 100561 crore as of March, 2011. Global deposit had also shown a positive growth of 6.01per cent to reach the level of Rs 154003 crore as of March, 2012 from Rs 145278 crore as of March, 2011. Global business had registered the volume of Rs 271507 crore as of March, 2012 from Rs 245839 crore as of March, 2011 by securing a respectable growth of 10.44per cent.

FY 11 FY 12 GROWTH

SL NO. Particulars (InRs.Cr) Absolute(PER CENT)

III GLOBAL

(i) Deposits 145278 154003 8725 6.01

(ii) Advances 100561 117504 16943 16.85

(iii)Total Business 245839 271507 25668 10.44

In case of domestic advances also bank had shown a steady growth of 15.65per cent to reach the level of Rs 107840 crore by March, 2012. Domestic deposit grew by 4.11per cent and reached the level of Rs 142017 crore by March, 2012. Domestic business also registered a respectable growth of 8.79per cent to reach the level of Rs 249857 crore as of March, 2012.

FY 11 FY 12 GROWTH

SL NO. Particulars (In Rs.Cr) Absolute(PER CENT)

I DOMESTIC

(i) Deposits 136415 142017 5602 4.11

(ii)Advances 93246 107840 14594 15.65

(iii)Total Business 229661 249857 20196 8.79

During the year 2011-12, the overseas centres of the Bank performed exceedingly well, with growth in deposits and advances at 35.24 per cent and 32.11 per cent, respectively to reach the level of Rs 11986 crore and Rs 9664 crore, respectively. Overseas business had shown a sharp upward trend to reach the level of Rs 21650 crore and recorded a 33.82 per cent growth during the financial year 2011-12.

FY 11 FY 12 GROWTH

SL NO. Particulars (InRs.Cr) Absolute (PER CENT)

II OVERSEAS

(i) Deposits 8863 11986 3123 35.24

(ii)Advances 7315 9664 2349 32.11

(iii)Total Business 16178 21650 5472 33.82

Per branch domestic business of the Bank has reached Rs 105 crore as of March, 2012. Per branch domestic deposits has reached Rs 59 crore in the year 2011-12. Per branch advances figure has improved from Rs 42 crore to Rs 45 crore during the year 2011-12.

2. PROFITABILITY:

During the year 2011-12, the Bank had shown a higher growth in net profit, which increased from Rs 907 crore in March, 2011 to Rs 1109 crore in March, 2012 by recording a growth of 22.27 per cent over the previous financial year. The net profit in the year 2011-12 was highest in the history of the Bank. The reason behind the respectable performance was basically the increase in interest income from Rs 11371 crore in March, 2011 to Rs 14632 crore in March, 2012 by recording a Y-O-Y growth of 28.68 per cent. Operating profit of the Bank had increased from Rs 2695 crore in March, 2011 to 2811 crore in March, 2012, thereby registering a y-o-y growth of 4.30 per cent. The declining Y-O-Y growth figure of operating profit was predominantly due to 42.57 per cent increase in interest paid during FY 11-12.

Important Ratios:

Sr Ratios Mar'2011 March, 2012

1 Return on Assets (per cent) 0.66 0.69

2 Cost to Income Ratio (per cent) 43.51 42.24

3 Book Value per Share (Rs.) 83.16 94.72

4 Earnings per Share (Rs.) 14.29 15.02

5 Net Interest Margin (per cent) 3.07 2.77

3. OPERATIONAL PERFORMANCE:

3.1. Investment:

Gross investment of the Bank has increased from Rs 43124 crore in March, 2011 to Rs 46185 crore in March, 2012 by registering a growth of 7 per cent in the year 2011-12. The Domestic investments (gross) of the Bank during the year 2011-12 grew by 8.82 per cent from Rs 41388 crore as of 31.03.2011 to Rs 45038 crore as of 31.03.2012. SLR investment (domestic) increased by 15 per cent during the year 2011-12 by registering the level of Rs 40102 crore in March,12 from Rs 34963 crore in March, 2011. Non-SLR investment (domestic) declined by 23 per cent from Rs 6425 crore in March, 2011 to Rs 4936 crore in March, 2012. Total income has also registered a reasonably good growth of 15.43per cent over the previous financial year to reach the level of Rs 3474 crore in March, 2012 from Rs 3009 crore in March,2011. Net profit on sale of investment (domestic) had shown a significant increase of (more than doubled) 115per cent by recording a level of Rs 191 crore in March, 2012 from Rs 89 crore in March, 2011.

3.2. Retail and CASA:

The Bank put considerable emphasis on strengthening its retail portfolio during the year 2011-12. There had been several initiatives to improve bank's liability portfolio like several CASA and Total Freedom campaigns throughout the country, launch of different deposit schemes, promoting salary account UCO Suvidha, etc. Attractive deposit schemes like Rd scheme UCO Sowbhagya, TD scheme UCO Vasanth Bonanza were launched at the later part of 2011-12 to boost the deposit volumes.

In order to improve the asset portfolio of the Bank and improve credit delivery to the retail customers by cutting down delays in processing of Retail Loan Applications as also to serve customer in a better manner, the bank had taken several initiatives during the year 2011-12. The Bank had opened 13 new Retail Loan Hubs in the year 2011-12, which takes the total number of RLHs to 39 as of March, 2012 from 26 as of March, 2011. Several existing schemes meant for retail customers namely, UCO Home Loan, UCO Trader, UCO Education, UCO Pension, etc., had been modified to remain competitive in the market as well as to suit niche clientele. Gold Loan scheme had been modified and new UCO Gold Loan Scheme had been launched for financing Retail Asset Products on 31st January, 2012 under both Priority and Non-Priority Sectors at all branches. Online application facility launched since 11th August, 2011 for UCO Home and Car Loans in addition to existing facility for UCO Education Loan.

Banc assurance:

In order to facilitate marketing of Mutual Fund Investments by the Branches through the Systematic Investment Plan (SIP) route, auto debit facility has been introduced on 16th January, 2012 in tie up with Bill Desk as our Aggregator.

The Bank during the year 2011-12, focused on marketing more traditional products rather than the single premium products to increase the fee based income.

3.3. Mid Corporate:

The Bank had given special attention to SME advances and accordingly a dedicated channel; SME Loan Hubs were launched at SME concentrated areas. During FY 2011-12, the Bank had opened 12 SME Loan Hubs at Ahmedabad, Bangalore, Bhubaneswar, Chandigarh, Chennai, Hyderabad, Jaipur, Kolkata, Mumbai, Nagpur, New Delhi and Raipur, under Mid Corporate supervision. These loan processing Hubs take up proposals in the range of Rs 25 lac to Rs 25 crore. Total loan sanctioned by the SME Hubs were Rs 1512 crore including renewal and enhancement as on 31.03.2012.

3.4. Agriculture & Rural business: Priority Sector Lending

During the year 2011-12, the priority sector advances of the Bank stood at Rs 28301 crore constituting thereby 33.56 per cent of Adjusted Net Bank Credit (ANBC).

Agricultural Advances

The total agricultural advances of the Bank stood at Rs 9653 crore constituting 11.45 per cent of ANBC. Direct agricultural credit stood at Rs 7632 crore constituting 9.05 per cent of ANBC and Indirect agriculture credit stood at Rs 2021 crore constituting 2.40 per cent of ANBC.

Advances to Weaker Sections

Advances to Weaker Sections stood at Rs 7861 crore as of 31st March, 2012, with percentage to ANBC being 9.32.

Medium, Small & Micro Enterprises (MSME) and Micro & Small Enterprises (MSE)

The Bank had recorded a phenomenal growth in these sections with advances under MSME and Micro & Small Enterprises (MSE) standing at Rs 17860 crore and Rs 13437 crore, respectively with growth rates of 20.76 per cent and 12.22 per cent, respectively over the previous financial year.

Minority Community Advances

Total Minority Community advances of the Bank stood at Rs 4113 crore constituting 4.88 per cent of ANBC.

Other Developments

The Bank had organized several credit camps throughout the country to boost advances related to agriculture business. During the year 2011-12 the Bank had entered into MOU with different organizations like Ashok Leyland, Bajaj Auto Ltd., National Collateral Management Services Ltd., etc. to lend commercial vehicles and finance farmers against their Storage receipts. The Bank had put serious emphasis on Govt. sponsored schemes like PMEGP (Prime Minister Employment Guarantee Programme), SGSY (Swarnajayanti Gram Swarozgar Yojana), SJSRY (Swarnajayanti Shahari Rozgar Yojana), PMRY (Prime Minister Rozgar Yojana), SHG (Self Help Group), JLG (Joint Liability Groups), etc. Gold loan scheme was also revised and launched with a competitive structure to boost finance under Priority Sector and Agriculture Business. Famers had been facilitated with credit facilities through tie-up arrangement with sugar companies.

3.5. Financial Inclusion:

In compliance with the directions given by the Government of India and Reserve Bank of India, the Bank had taken up implementation of the project under Financial Inclusion'. The Bank had adopted 3-way Approach to implement the Financial Inclusion Programme which constitutes (i) Brick & Mortar branches, (ii) UCO Bank on Wheels (Mobile Van) and (iii) Business Correspondent (BC) Model using ICT-based financial inclusion.

The Bank had achieved a rare milestone in the field of Financial Inclusion. During the year 2011-12, the target for the Bank was to cover 1703 unbanked villages having a population of 2000 plus each. The Bank had covered all the villages within the stipulated time. In addition to that the bank has covered 107 villages with a population of 1000-2000 each. Thus the Bank has covered 1810 number of villages; and 639149 number of no -frill accounts were opened in these villages.

The Bank has 24 UCO Bank on Wheels operating in 18 Zones. Under ICT based BC Model, 47984 Smart cards had been issued to the customers. To extend business in the field of Financial Inclusion the Bank had also opened 62 Ultra Small Branches (UCO MITRA SAKHA) in the unbanked villages under 11 Zones in compliance with the latest guidelines of Government of India on Financial Inclusion.

3.6. Recovery:

Financial year 2011-12 has been declared as YEAR OF RECOVERY and there is substantial improvement in Recovery and Up gradation in NPA accounts during the financial year 2011- 12 over the last year.

(Rs.in Crore)

per cent Particulars 31.03.2011 31.03.2012 per cent Increase

Cash Recovery 434 658 51.61

Upgradation 226 417 84.51

Total 660 1075 62.88

Recovery made in Written-Off accounts during the year ended 31.03.2012 was Rs 23 crore. Recovery made during the year 2011- 12 through Compromise settlement is Rs 104 crore comprising of more than 5000 accounts.

The Bank had completed 100per cent system based identification and collation of NPAs as of the quarter ended 30.09.2011, in compliance with the directives of Government of India, Ministry of Finance. The Bank had decided that the Circle Heads would personally monitor all NPA accounts of Rs 1.00 crore and above under their jurisdiction and Zonal Heads would personally monitor NPA accounts of Rs 10 lac and above in the Zone on an on-going' basis. Periodic Monitoring of recovery performance of Zones/ Circles through VIDEO CONFERENCING had been done throughout the year.

As on 31.03.2012, 340 cases has been identified as willful defaulters and reported to CIBIL/RBI as against the corresponding figure of 134 as on 31.03.2011.

Number of Lok Adalats conducted during the year was 359 from which recovery of Rs 6.26 crore was achieved; and recovery made through Special Compromised Settlement Scheme in small loan accounts up to Rs 5.00 lakh was Rs 30.47 crore. The scheme had been further extended up to 31.03.2013, in order to boost up the recovery in small NPA accounts.

SARFAESI action being initiated immediately after the account became NPA; and as on 31.03.2012, total recovery made through SARFAESI action is Rs 210 crore as against Rs 108 crore during 2010-11.

4. BOLSTERING ACTIVITIES:

4.1. Risk Management:

During the year 2011-12 the Bank had put serious efforts to take several new initiatives under the guidelines of Risk Management. Fraud Risk Management Cell and Centralized Credit Rating System were put in place to strengthen monitoring system. Individual Borrower wise Exposure Ceiling based on the Constitution of the Borrowers had been fixed. Daily Structural Liquidity Report, Mid Office Report & Dynamic Liquidity Report were introduced and were being placed to the Top Management as per schedule. Computation of market risk on the trading book on a daily basis had been done successfully. Training on CIBIL for all the nodal officers in the Circle level had been provided to improve the data acceptance /pulling.

Capital Adequacy Basel II)

Particulars Mar'11 March, 2012 Capital Fund : Amt in Rs.Cr.

I / Tier I 7,012 7,891

I / Tier II 4,266 4,151

Total (Tier I Tier II) 11,278 12,042

Risk Weighted Assets 82,272 97,550

Capital Adequacy Ratio (per cent) 13.71 12.35

Tier I (per cent) 8.52 8.09

Tier II (per cent) 5.19 4.26

4.2. Corporate Communication:

During the year 2011-12, the Bank had taken several unities under the guidance of Corporate Communications through various media namely electronic media, print media, internet, publicity material, sponsorship, outdoor media, etc. Widespread publicity campaigns were carried out for mobilization of CASA deposits, celebrating Festival Bonanza Offer, launching of new schemes such as, 'UCO Sunshine Recurring Deposit Scheme, 'UCO Vasant Bonanza Fixed Deposit', 'UCO Sowbhagya Recurring Deposit', etc. The Bank also organized "Campaign for Gold Loan", "Campaign for Advantage UCO - Home Loan and Car Loan" etc. Payment of State Commercial Tax through the Bank in various states was one of the achievements during the year 2011-12.

In order to improve the brand name of the Bank, various campaigns were undertaken for different products through various jingles on different radio stations. Intensive campaigns were undertaken by the Bank for popularizing its brand name during the presentation of Union Finance Budget for the year 2011-12 through Radio jingle and telecast of Bank's promos on different television channels. Internet advertisement had been organized through different sites. The Bank had also displayed and installed banners at the entrance/exit points during various important activities/happenings like sports, festivals, musical programmes, etc. in the city of Kolkata to propagate various products and brand name of the Bank. Sponsorship of Gates, pillars, hoardings to various Puja Committees, display of 500 banners at various Puja Committees, distribution of UCO Bank branded T-shirts and caps, etc. had been arranged to promote different products during Durga Puja.

The Bank had celebrated its 70th foundation day with the main function held at Science City on 6th January, 2012. A branded canter/tableau was flagged off from Head Office and roamed for 7 days in Kolkata. Pamphlets on CASA, Retail loans, Education Loan, Home Loan were also distributed. School bags, school stationary were given to 69 needy students on the auspicious occasion of Foundation Day celebration.

4.3. Information Technology:

The Bank had become fully CBS enabled by February, 2011. As of March, 2012, all the new branches, CBOs and extension counters were made CBS enabled. Total number of 843 branches (100per cent) of Bank sponsored 5 RRB's migrated to CBS. RTGS/NEFT facility extended to Bank sponsored 5 RRBs.

On the technology front the Bank had held its flag high by taking several new initiatives during the year 2011-12. Some of these initiatives are stated below.

- Govt. Business Module implemented in all designated branches.

- Two factor Authentication implemented for e-banking customers.

- Anti-Phishing Services implemented to protect customer's data from going to the wrong hands.

- Collection of State Taxes for West Bengal, Orissa, Delhi, UP made live. In the previous financial year, Maharashtra's tax collection was made live.

- Online Payment facility of customs duty is available through e-Banking.

- Instant Fund Transfer to RD and Loan accounts through e-Banking.

- Bulk salary upload facility for Chhattisgarh Govt. activated.

- New e-products introduced in the Bank in the current year is given below:

Products Introduction Date

UCO e-trade 25th April, 2011

IMPS (Instant Mobile payment service) 22nd July, 2011

Personalized UCO VISA Debit Card 6th January, 2012

4.4. Operations & Services: Know Your Customer (KYC) & Anti Money Laundering (AML)

System Based KYC Monitoring has been put in place for KYC compliance through KYC menu in CBS System. The installation of AML software for daily processing and monitoring of all transactions in the Bank to generate (a) Suspicious Transaction Reports (STRs) and (b) Cash Transaction Reports (CTRs) has been streamlined further and the Bank is able to effectively process and monitor all transactions particularly through new alerts. KYC compliance had been achieved to the extent of 98.29per cent . CTRs, STRs, CCRs and NTRs had been submitted regularly to FIU-IND, New Delhi.

Customer Service

The Bank continues to attach utmost importance to the customer service and is constantly reviewing its business practices to provide the best possible services to the customers.

Top executives of the Bank, during the year 2011-12, interacted with the customers of the Bank at frequent intervals at different centres across the country to have complete feedback and understanding of the needs and grievances of the customers of the Bank. Apart from this, nodal officers had been appointed at all the Zonal Offices to look into the grievances. Effective steps were taken by the Bank to redress grievances of the customers; and accordingly, the Bank has brought down the number of customer complaints to a very low level through its prompt redressal mechanism. The meeting of the Standing Committee on Customer Service at corporate level of the Bank was held as per schedule and was attended by senior executives of the Bank as well as customer representatives.

Transparency had been maintained by the Bank by hosting at Bank's website: (1) Policies on Customer Grievance Redressal (2) Cheque Collection, (3) Compensation & (4) Collection Of Dues and Repossession Of Security.

Awards passed by Banking Ombudsman were being implemented by the Bank and as of date no Award is pending for implementation.

Right to Information (RTI) Act

Under the light of Right to Information (RTI) Act Bank's commitments for our customers are well defined and published in the Bank's website. The Bank is in continuous process of strengthening of review under Right to Information (RTI) Act. The Bank had designated central and zonal nodal officers to cater to the queries of different customers and other stake holders regarding RTI matters. Names and contact details of nodal officers are mentioned in the Bank's website. As per RTI Act 2005, the Bank has appointed 36 PIOs and APIOs, one at each Zonal Office level and two CPIOs and two CAPIOs at Head Office level to facilitate disposal of RTI applications seeking information and one Appellate Authority at each Circle Office and Head Office for disposal of appeals filed under their jurisdiction.

4.5. Credit Monitoring:

The Bank, in order to maintain and improve the quality of assets, strengthened its Credit Monitoring Mechanism through implementation of several measures particularly having a Graded system of monitoring of accounts at various levels by assigning responsibility of monitoring of accounts based on sanctioned credit limits with the objective to intensify the credit monitoring and have focused attention to critical accounts. In addition, the bank has also streamlined the information system by directly obtaining information from the CBS system for facilitating prompt decision making at various levels. The Bank has envisaged creation of a pool of dedicated Executives and Officers, with track record on handling large borrowal accounts & well versed in handling of credit at the operational level, for undertaking credit audits.

The Bank has done a commendable work in getting registered with the Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI) particulars of security interest over property created on or before 31/03/2011. Such registration under Central Registry Rules 2011 under section 20 (1) of the SARFAESI Act 2002 was permitted by the Central Government with retrospective effect to be completed within 31.03.2012. The Bank could ensure uploading of over 1.17 lac particulars of security interest over property created on or before 31.03.2011.

4.6. Inspection:

The Bank has a well-established Audit and Inspection Department that examines adherence to the Systems. Bank has a comprehensive Inspection and Audit Policy for undertaking Internal Inspections, Concurrent Audit, Revenue Audit, Risk Based Internal Audit, IS (Information System) Audit and Management Audit. The guidelines received on various issues of Internal Control from Reserve Bank of India, Government of India, Board and Audit Committee of the Board have become part of the internal control system for better risk management.

During the year 2011-12 the Bank had focused attention to close overdue inspection reports outstanding for more than 3 months by rectification of major/other irregularities. As a result of impetus taken by the Bank there was no Annual Financial Inspection Report pending overdue as on March, 2012. The regular branch inspection report is the most comprehensive feed-back to the management about compliance of the Bank's systems and procedure and guidelines at operational level.

One of the major achievements during the year 2011-12 was the restoration of original rating of downgraded branches. From December, 2011 to February, 2012 number of Unsatisfactory/ Downgraded branches has decreased due to regular follow up with Disciplinary Authorities/Controlling Offices and branches to expedite initiation of RDA and ensure restoration of original rating of all the downgraded branches. Similarly, status of unsatisfactory rated branches has been upgraded through fresh inspection within an interval of 9 months.

4.7. Vigilance:

The Bank has shifted its focus towards preventive vigilance and participatory vigilance from punitive vigilance. Extensive training programme had been organized for imparting training of employees at all level.

A separate 'Investigation Cell' has been carved out to ensure timely and effective follow up of vigilance complaints. A Fraud Risk Management Department was also created to monitor and maintain the centralized data of fraud. Policies regarding field functionaries have been updated and sensitized to regulatory requirements and guidelines issued with a view to improve compliance.

Some of the Preventive Vigilance Measures undertaken during the year 2011-12 include:

- All withdrawals of money should be informed to the customers, if possible, through SMS without delay.

- Every large amount of withdrawal should be verified with supporting documents. Cheque should be examined with UV & IR rays.

- If post withdrawal balance is negligible, cheque should be scrutinized.

- No blank cheque should be handed over by the customer to any unknown person.

7.8.Compliance:

The Bank has emphasized on compliance issues as mandated by RBI. The Bank had ensured the level of customer service, functions and rules of deposit, advance, KYC/AML, other services, prompt submission of statutory/regulatory reports, information and data asked by RBI, GOI, etc. through a strict compliance system. During the year 2011-12 the Compliance Policy was revised, reviewed and the same was adopted by Board of Directors in its meeting held on 11.5.2011. The revised Compliance Policy incorporating necessary changes to prevent deviations from standard norms was circularized to all sections of the Bank thereafter. Compliance testing of operations at branches was introduced during the year 2011-12 to render deficiencies observed and rectified them on the spot to improve operational efficiency. Critical issues were reported and discussed at the appropriate level to enhance efficacy of the system.

4.9. Legal Matters:

The Bank had delivered legal advice on various matters referred to it by all sections of stakeholders. The Bank had focused on the expeditious disposal of such matters for enhancing the efficiency of operational tiers. To ensure this, a continuous Monitoring System was in place. The Bank had extended its legal service to cater to the need of recovery issues, personal and industrial disputes filed by different sources, premises matters, legal audits, documentations, tribunal requirements, Ombudsman compliance, etc. Empanelment of good lawyers was done successfully to set and maintain benchmark for legal issues.

5. HUMAN RESOURCES MANAGEMENT:

Manpower

The total staff strength of the Bank as on 31st March, 2012 stood at 23,259 including 112 employees serving overseas, 15 of which are expatriate officers. The total domestic staff strength of 23,147 comprises of 9059 Officers, 9171 Clerks and 4917 Subordinate staff.

The percentage of Scheduled castes (4716) and Scheduled Tribes (1179) in the total domestic staff strength is 25.46. Besides there are 1309 OBC employees in service of the Bank at the end of FY 11-12 and 1148 employees belong to Minority Communities. Out of the total work force 14.33per cent constitutes women employees compared to 13per cent in 2011.

During the year 2011-12 initiatives were taken by the bank for development of SCs, STs, OBCs, Persons with Disabilities, Ex- Servicemen and Women; and pre-promotion/recruitment trainings were imparted to SC/ST candidates as per Government of India directives.

Recruitment

A total number of 768 Officers have been recruited during the year 2011-12 which includes 102 SCs, 51 STs and 216 OBCs. 243 of these Officers are Women, 11 are Persons with Disabilities and 46 belong to Minority Communities. 867 Clerks have also been recruited during the Year 11-12 which include 134 SCs, 117 STs, and 242 OBCs, 52 Ex-Servicemen, 43 Persons with Disabilities and 42 Persons belong to Minority Communities. Moreover the Bank has also initiated the process of recruitment for 1000 Clerks and 1100 probationary Officers during the year 2012-13.

Promotions

During the year, 8 Executives were promoted to Top Executive Grade Scale VII. 41 Executives were promoted from Scale-V to Top Executive Grade Scale-VI and 114 Executives were promoted from Scale-IV to Scale-V. Besides, 130 Officers were promoted to Scale-IV, 574 to Scale-III and 1040 to Scale- II. In addition, under specialist category, 2 Officers were promoted from Scale- IV to Scale-V, 3 Officers were promoted from Scale-III to Scale- IV, 12 Officers to Scale-III and 3 Officers to Scale- II. Further, during the period, 8 Sub-ordinate Staff got promoted to Clerical Cadre under Graduate channel and process for other 2 channels for promotion to Clerical Cadre is in progress.

Staff Welfare Measures

During Financial Year 2011-12, the Bank has implemented the following Staff Welfare Measures:

MODIFICATIONS/CHANGES IN THE EXISTING SCHEMES:

1) UCO Diamond Jubilee Prize Scheme - This scheme has also been extended to the meritorious wards of permanent subordinate staff members (including PT Sweepers in scale wages) in recognition of their merits for securing higher marks in 12th Standard & Graduation level (10 prizes- i.e. 5 each for 12th Standard & Graduation).

2) Reimbursement of cost of spectacles to the employees in the age group of 40 years and above - Increase in amount from Rs 500.00 to Rs 1000.00.

3) Educational assistance to the school/college going dependent son/daughter of the deceased employees where no compassionate appointment has been offered - Financial assistance of Rs 5000.00 p.a. has been extended till completion of the Course of the children.

4) Financial assistance of Rs 5000.00 to the mentally retarded child/ Rs 3000/- to physically challenged child of the employee and one time assistance for purchase of certain artificial aid/accessories - In respect of the scheme of financial assistance for physically challenged & mentally retarded children of employees, the age bar has been extended from 21 year to 25 years in cases of mentally retarded children of the employees.

5) Group Med claim Insurance Scheme for in-service employees and their dependents with M/s United India Insurance Co. Ltd. - Renewed with enhancement in sum assured from Rs 1.50 lac to Rs 2.00 lac which has further been enhanced from Rs 2.00 lac to Rs 5.00 lac with effect from 31.03.2012 valid up 31.10.2012.

6) Renewal of Group Mediclaim Insurance Scheme for retired employees and their spouse with M/s United India Insurance Co. Ltd. - Enhancement in sum assured from Rs 1 lac to Rs 2 lac - which is effective from 31.03.2012 and valid up to 30.03.2013.

NEW SCHEMES

1) Payment of funeral expenses to the family of retired employees from the staff welfare fund - Scheme for payment of funeral expenses has also been extended to family members (spouse/son/daughter) of retired employees in the event of death of the retired employee up to a maximum amount of Rs.5000.00 (one time).

2) Bank has decided to initiate a Holiday Home at Shirdi (Maharashtra).

3) Blood Donation & Preliminary Health Check-up camps have been organized at Zonal Office levels during the foundation week of the bank beginning with 6th January - Maximum permissible expenses were limited to Rs 10000.00 for each Zone.

Industrial Relations

During the period, the Industrial Relations climate in the Bank remained healthy and cordial between the Management and the Unions/ Associations. IR meetings and discussions were held with Unions / Associations at periodic intervals sharing co- operative attitude and mutual respect during the financial year 2011-12.

Training

During the year 2011-12, a total number of 8,160 participants comprising of Officers, Clerks and Sub-staff were trained in the Banks' Central Staff College and five Regional Training Centres through a total of 18 channels.

Over and above this, 243 Officers were nominated for specialized training in Credit, IT, Risk management, Forex, and Leadership programmes to Institutes such as NIBM, IIBM, IDBRT, BIRD, CAB, NIRD, and FEDAI. 7 Executives attended overseas training programmes.

6.COMPLIANCE OF OFFICIAL LANGUAGE POLICY:

The Bank has taken proactive steps to implement the Official Language Policy of Govt. of India and has meticulously taken steps to comply with the provisions of Official Languages Act and the Rules made there under. The Bank has also taken appropriate follow-up action to implement the directives as contained in the Annual programme with regard to the use of Official Language Hindi issued by Government of India, Ministry of Home Affairs, Dept. of Official Language and also endeavored to achieve various targets prescribed in the said programme. Bank has also given preferred attention to comply with the instructions of Financial Services Department, Ministry of Finance and Reserve Bank of India regarding the use of Hindi in official work.

Eighty six Hindi Workshops, including workshops for Chief Officers/ Senior Officers were organized by the Bank for the Officers and employees to motivate them to do their work in Hindi. Total 1711 Officers / employees were trained through these Hindi Workshops. 472 branches were inspected by Official Language Officers posted at different Zonal Offices, 10 Zonal Offices and 5 depts. of Head Office were also inspected by Official Language Officers posted at Head Office during the period under review to evaluate the performance in the area of implementation of Official Language Policy of Govt. of India and necessary remedial measures were also taken to remove the deficiencies observed in such inspections.

The Bank successfully organized various competitions, rendered editorial assistance to other Public Sector Banks & Financial Institutions in conducting 'HINDI UNICODE WORKSHOP' & 'Hindi workshop' under the auspices of different TOLICs. During the period under review Zonal Office, Luck now and Zonal Office, Dharamshala were awarded 1st Prize /Shield and 2nd Prize, respectively by TOLIC Luck now and Dharmashala. In addition, Members of staff of our Bank working at H.O., Kolkata won 10 prizes, Luck now 6 prizes, Ranchi 2 prizes, Jaipur 2 prizes, Raipur 1 prize, Bhagalpur 1 prize, Ahmadabad 2 prizes, Nagpur 2 prizes, Chennai 1prize, respectively at various competitions organized on the occasion of "HINDI DIWAS" under the aegis of different TOLICs.

"Hindi Month", "Hindi Fortnight", "Hindi Week" were celebrated enthusiastically at Head Office as well as Zonal Offices, Central Staff College, Regional Training Centres and Branches. During " Hindi Month " at Head Office, Hindi Competitions and various Official Language awareness programmes for the Executives/ Officers, Clerks and Sub-Staffs were organized.

During the period under review Our Bank successfully hosted the meetings of Official Language Implementation Committee of Financial Services Dept., Ministry of Finance (for Public Sector Banks and Financial Institutions) and Public Sector Banks under the auspices of Reserve Bank of India in Kolkata on 16th July, 2011. In view of the requirement to accelerate the pace of implementation of Official Language Policy of Govt. of India, All India UCO Bank Official Language Officers' Conference was organized in Mumbai on 29th and 30th December, 2011.

Various forms / publicity materials / procedural booklets viz. report of Annual General meeting of Shareholders, Manual of Instructions and Minutes of various Board Committees were prepared in bilingual form. Hindi text of the materials for our Bank's Website was also prepared and in ATM Screen of the Bank information /guidelines, as the case may be, were made available in trilingual form i.e. in Regional Language, Hindi and English. Sufficient amount was allocated by the Bank for the purchase of classic literary Hindi books, dictionaries, technical glossaries, Hindi books on computer/banking etc. and famous literary books in regional languages written by renowned litterateurs.

7.FUTURE PLANS:

The year 2012-13 shall be the year of Retail Banking in both asset and liability category for the Bank. However, the Bank shall continue to focus on Recovery. The Bank shall be aiming at crossing two major milestones such as total business of more than three lac crore rupees and branch network of more than 2500 by March, 2013. The Bank shall also be focusing on more leveraging technologies to make the Bank more user friendly by working through business reengineering processes.

I. BOARD OF DIRECTORS:

8. CORPORATE GOVERNANCE:

The Bank firmly believes in and has consistently practiced good corporate governance which is woven around its core values of transparency, professionalism and accountability. By constantly focusing on these aspects in its day-to-day operations, the Bank strives to enhance shareholders' value. The Bank being committed to the principles of good governance, its Board of Directors has formed various committees of the Board to monitor every aspect of Bank's business.

The systems and business processes of the Bank are continuously reviewed at various levels for identifying and strengthening areas of weaknesses, if any. The Directors of the Bank believe that good governance is the key to earning trust, loyalty and goodwill of clients, business associates, employees and investors and respect from the society at large.

Changes in the Board of Directors

On being appointed by the Government of India, Shri S. Chandrasekhar an took over as the Executive Director of the Bank w.e.f. 01.10.2011. Shri S. K. Sinha served as the Government Nominee Director in the Board from 10.06.2008 to 21.07.2011. Thereafter, Dr. K. L. Prasad served as the Government Nominee Director of the Bank from 22.07.2011 to 01.12.2011. With effect from 02.12.2011, Shri Pravin Rawal has been appointed as Government Nominee Director. Shri Manoj Kumar Gupta was appointed as Chartered Accountant Director on 02.08.2011.

Shri Ajai Kumar relinquished the charge of Executive Director of the Bank on 30.09.2011on his appointment as Chairman & Managing Director of Corporation Bank. Md. Akhruzzaman who joined the Board on 14.7.2010, resigned as Director of the Bank on 18.05.2011. Another Director Shri Jai Dev Gupta resigned from the Board on 13.06.2011. Shri Sanjeev Jain, on completion of his tenure ceased to be a Director from 02.03.2012.

Meetings of the Board of Directors

During the financial year 2011-12, the Bank had 15 meetings of the Board of Directors, 21 meetings of the Management Committee of the Board, 11 meetings of the Audit Committee of the Board. The number of meetings of various other Committees of the Board held during the year 2011-12 are given below.

Sl No. Name of the Committee No. of Meetings held

1. Risk Management Committee 4

2. Shareholders' Grievance Redressal Committee 2

3. Share Transfer Committee 12

4. Special Committee for Monitoring Large-value Frauds 4

5. Customer Service Committee of the Board 4

6. Committee on HR-related issues of the Bank 5

7. Nomination Committee of the Board 2

8. Remuneration Committee of the Board 1

9. Committee of the Board on IT Management 1

Statement of Directors' Responsibilities

The Directors confirm that in the preparation of the annual accounts for the year ended March 31, 2012

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 Reserve Bank of India, were consistently applied.

Reasonable and prudent judgments and estimates were made so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit of the Bank for the year ended March 31, 2012.

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 an on-going basis.

Acknowledgements

The Board of Directors places on record its deep appreciation of the contributions made to the deliberations of the Board by outgoing Executive Director, Shri Ajai Kumar and other outgoing Directors namely, Md. Akhruzzaman, Dr. K. L. Prasad, Shri Jai Dev Gupta, Shri S. K. Sinha and Shri Sanjeev Jain.

The Board would like to welcome the new Directors and looks forward to their valuable inputs towards growth of the Bank. The Directors remain thankful to the Government of India, Reserve Bank of India and other regulatory authorities for their support and valuable guidance.

The Board also thanks other Financial Institutions and correspondent banks for their sincere co-operation. The Directors express their gratitude to the loyal customers for their trust and continuous patronage of the Bank. The Board also thanks the Staff Unions/Associations and shareholders of the Bank for the support extended by them. The Directors place on record their deep appreciation of the dedication shown by each employee of the Bank due to which the Bank could achieve so many milestones.

For and on behalf of Board of Directors,

Dated: 05th May, 2012 (Arun Kaul)

Place: Kolkata Chairman & Managing Director


Mar 31, 2010

The Board of Directors presents the 41st Annual Report on the working of the Bank. The Audited Balance Sheet as on 31.03.2010 and the Profit & Loss Account for the year ended 31.03.2010 appended with the Auditors Report, are enclosed.

Corporate Governance :

The Bank firmly believes in and has consistently practiced good corporate governance which is woven around its core values of transparency, professionalism and accountability. By constantly focusing on these aspects in its day-to-day operations, the Bank strives to enhance shareholders value. The Bank being committed to the principles of good governance, its Board of Directors has formed various committees of the Board to monitor every aspect of Banks business.

The systems and business processes of the Bank are continuously reviewed at various levels for identifying and strengthening areas of weaknesses, if any. The Directors of the Bank believe that good governance is the key to earning trust, loyalty and goodwill of clients, business associates, employees and investors and respect from the society at large.

Changes in the Board of Directors:

During the FY09-10, Shri Ajai Kumar, Executive Director was inducted into the Board of Directors on 07.12.09 in place of Sri B M Mittal, Executive Director who demifted office on 01.1 1.09 on superannuation. Sri P L Mittal, Chartered Account Director retired from the Board w.e.f. 02.1.10. Sri Ram Avtar Sharma was inducted into the Board on 1 5.2.1 0 as Workman Director.

Meeting of the Board of Directors :

During the FY09-1 0, the Bank had 1 2 meetings of the Board of Directors, 22 meetings of the Management Committee and 8 meetings of the Audit Committee of the Board. The number of meetings held by various other Committees of the Board are as under:



SI. No. Name of the Committee No. of Meet ings held

1 Management Committee 4

2 Shareholders Grievance Redressal Committee 2

3 Share Transfer Committee 12

4 Remuneration Committee 1

5 Special Committee for Monitoring Large-value Frauds 3

6 Fhret/Customer Service Committee 4

7 Committee on HR Related issues of the Bank 3

8 Committee of Joint Insurance Venture (Non-life) 1



Statement of Directors Responsibilities:

The Directors confirm >haf in the preparation of the annual accounts for the year ended March 31, 201 0:

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 Reserve Bank of India, were consistently applied.

Reasonable and prudent judgements and estimates were made so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit of the Bank for the year ended March 31, 2010.

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 an on-going concern basis.

Acknowledgements:

The Board of Directors places on record its deep appreciation of the contributions made by Sri B M Mittal and Sri P L Mittal to the deliberations of the Board. The Board would like to welcome the new Directors and looks forward to their valuable inputs in running of the Bank. The Directors remain thankful to the Government of India, Reserve Bank of India and other regulatory authorities for their support and valuable guidance. The Board also thanks other Financial Institutions and correspondent banks for their sincere co-operation. The Directors are also grateful to the loyal customers for their trust and continuous patronage of the Bank. The Board remains thankful for the support extended by the Staff Unions/ Associations and shareholders of the Bank. The Directors place on record their deep appreciation of the dedication shown by each employee of the Bank because of which the Bank could achieve so many milestones.

For and on behalf of Board of Directors

Kolkata (S K Goel)

30.04.2010 Chairman & Managing Director

 
Subscribe now to get personal finance updates in your inbox!