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Directors Report of Central Bank of India

Mar 31, 2023

Your Directors have pleasure in presenting the Annual Report of the Bank along with the Audited Statement of Accounts, the Profit and Loss accounts and the cash flow statement for the year ended March 31, 2023.

1. Performance Highlights:

Â» Total Business of the Bank stood at '' 577075 crore as at March 31,2023 compared to '' 532404 crore as at March 31,2022.

Â» Total Deposits stood at '' 359296 crore as against '' 342692 crore in March 31,2022.

Â» Total Advances of the Bank stood at '' 217779 crore as against ''189712 crore in March 31,2022.

Â» Total Income for the financial year ended March 31,2023 was '' 29626 crore as compared to '' 25770 crore for the financial year ended March 31,2022.

Â» Non-Interest Income of the Bank stood at '' 4084 crore for the financial year ended March 31,2023 compared to '' 2968 crore for the financial year ended March 31,2022.

Â» Operating Profit of the Bank increased to '' 6884 crore for the financial year ended March 31,2023 as compared to '' 5742 crore for the corresponding previous financial year ended March 31,2022 showing increase of 19.89%.

Â» The Bank has earned Net Profit of '' 1582 crore for the financial year ended March 31,2023 as compared to Net profit of '' 1045 crore during previous financial year ended March 31,2022.

Â» Business per employee increased to '' 18.70 crore during the financial year ended March 31,2023 from '' 17.52 crore in the previous financial year ended March 31,2022.

Â» Capital Adequacy Ratio (as per Basel-III) stood at 14.12%@ with Tier I at 12.11% and Tier II at 2.01% for the financial year ended March 31,2023. (@Bank has computed Capital Ratio after adjustment for reckoning NPV of non-interest bearing recapitalization bond issued by Government of India.

Â» Net worth stood at '' 25449.41 crore as on March 31,2023.

Â» Cash Recovery (including sale of NPA & written off accounts) improved to '' 4213 crore in the financial year ended March 31,2023 as compared to '' 3617 crore in the previous financial year ended March 31,2022.

Â» Gross NPA to Gross Advances improved to 8.44% as on March 31,2023 from 14.84% as on March 31,2022.

Â» Net NPA to Net Advances reduced to 1.77% as on March

31.2023 as against 3.97% as on March 31,2022.

Â» Provision Coverage Ratio improved to 92.48% as on March

31.2023 from 86.69% as on March 31,2021.

Â» Net Interest Margin (NIM) improved to 3.64% in the financial year ended March 31,2023 as compared to 3.21% in the Financial Year ended March 31,2022.

Â» Return on Assets (ROA) is 0.44% for the Financial Year ended March 31,2023.

Â» The credit deployment under priority sector stood at '' 103518.76 crore during FY 2022-23. However, to take an advantage of excessive lending over ANBC in Priority Sector credit, Bank undertook sale/purchase transactions in PSLCs. During the year Bank sold PLSCs worth '' 4650 crore under PS Advances.

Â» Agriculture Advance of the Bank stood at '' 42110 crore for the financial year ended March 31,2023 as against ''38635 crore for the previous financial year ended March 31,2022.

Â» MSME Advances for the Financial Year ended March 31, 2023 stood at '' 39199 crore without PSLC and Investment in SIDBI is '' 275.21 crore and Mudra limited is ''23.60 crore. PSLC for the FY 2022-23 is 700 crore.

Â» Retail Loans increased to '' 62726 crore in financial year ended March 31,2023 from '' 52226 crore in financial year ended March 31,2022.

Â» Housing Loan portfolio of the Bank stood at '' 38793 crore for the financial year ended March 31, 2023, registering y-o-y growth of 28.61%. Housing Loan Portfolio constitutes 61.83% of the total Retail Portfolio as on March 31,2023.

Â» There are 46 RSETIs in 9 States of the country viz. Madhya Pradesh(18), Bihar(9), Maharashtra(6), Uttar Pradesh(5), West Bengal(3), Chhattisgarh(2), Rajasthan(1), Odissa(1) and Assam(1). During the year 2022-23, the RSETIs conducted 960 training programmes and imparted training to 27428 candidates. Out of this,21036 (i.e. 77%) trainees were settled through bank credit, wage settlement and selffinance. Credit linkage of settled candidates achieved is 12045 i.e. 57%.

Â» Bank has 2 RRBs as on 31^st March 2023 in 2 states covering 23 districts with a network of 1175 branches.

Â» Under Financial Inclusion, Bank deployed 13142 BC Agents. Bank has opened 997 Urban Financial Inclusion centres.

Â» Total earning from Bancassurance business is '' 91 crore for the financial year ended March 31,2023.

Â» Bank is having pan India presence with network of 4493 branches with 65.21 % (2930 branches) in rural & semiurban areas, 3752 ATMs and 9959 BC Points with total 18204 Touch Points as on 31^st March 2023.

2. Income & Expenditure:

Details of income and expenditure for the financial year 2022-23 are given hereunder:

('' in Crores)
		31.03.2023	31.03.2022	Variation	%
1	Interest Income	25542	22802	2740	12.01%
- Advances		14922	11501	3421	29.75%
- Investments		8715	9264	(549)	-5.92%
- Others		1905	2037	(132)	-6.48%
2	Non Interest Income*	4084	2968	1116	37.60%
3	Total Income (1 2)*	29626	25770	3856	14.96%
4	Interest Expended	13855	13315	540	4.06%
- Deposits		13388	12848	540	4.04%
- Others		467	467	-	-
5	Operating Expenses	8887	6713	2174	32.38%
- Establishment		5604	3927	1677	42.70%
- Others		3283	2786	497	17.83%
6	Total Expenses (4 5)	22742	20028	2714	13.55%
7	Spread (1-4)	11687	9487	2200	23.18%
8	Operating Profit (3-6)*	6884	5742	1142	19.88%
9	Provisions*	5302	4152	1150	27.69%
10	Provisions For Tax	1063	672	391	58.18%
11	Exceptional Item (expenses)	0	545		-
12	NET PROFIT/(LOSS) (8-9-11)	1582	1045	537	51.39%
* Figures have been recalculated/ regrouped wherever necessary to confirm the current year classification

3. Provisions:

Details of Total Provisions of '' 5302 crore charged to the Profit and Loss Account during the financial year 2022-23 visa-vis previous financial year are detailed as under:

('' in Crores)
	31.03.2023	31.03.2022	Variation
	(FY)	(FY)
Provisions for Standard Assets	681	(222)	406.76%
Provisions for NPAs*	3534	2454	44.01%
Provisions for Restructured Accounts	(222)	596	-137.25%
Provision on Investments*	215	653	-67.08%
Provisions for Taxes	1063	672	58.18%
Others	31	(1)	3200.00%
Total	5302	4152	27.70%
* Figures have been recalculated/ regrouped wherever necessary to confirm the current year classification

4. Profitability Ratios:

(In percentage)
	31.03.2023	31.03.2022
	(FY)	(FY)
Cost Of Deposit	3.92	3.86
Cost Of Funds	3.97	3.92
Yield On Advances	7.61	6.57
Yield on Investments	6.26	6.27
Yield On Investment (Including Trading profit)	6.41	6.59
Net Interest margin	3.64	3.21
Cost To Income Ratio	56.35	53.90

5. Business Ratios:		(In percentage)
	31.03.2023 (FY)	31.03.2022 (FY)
Interest Income to Average Working Fund (AWF)	7.67	6.65
Non-Interest Income to AWF	1.53	0.87
Operating Profit to AWF	2.26	1.67
Return on Average Assets	0.61	0.30
Business Per Employee ('' in crore)	18.70	17.15
Net Profit per Employee ('' in lakh)	7.42	3.38
* Figures have been recalculated/ regrouped wherever necessary to confirm the current year classification.

6. Capital to Risk Weighted Assets Ratio (CRAR): The components of Capital Adequacy Ratio were as under:
	31.03.2023 (FY)*	31.03.2022 (FY)
	Basel-IM	Basel-III
Tier-I	12.11%	11.48%
Tier-II	2.01%	2.36%
Capital Adequacy Ratio	14.12%	13.84%
*As advised by RBI in its risk assessment report, Bank has computed Capital Ratio after adjustment for reckoning NPV of non-interest bearing recapitalization bond issued by Government of India

7. Net Profit/Loss:

The Bank has earned net profit amounting to '' 1582 crore during the financial year ended March 31, 2023. Board of Directors has not recommended any dividend on equity shares for the Financial Year 2022-23.

8. Dividend:

With a view to conserve resources for future business operations of the Bank, your Directors do not recommend any dividend for the financial year 2022-23.

9. Changes in the Board during the year:

Shri Bhushan Kumar Sinha ceased to be Director of the Board of the Bank w.e.f 11.04.2022 who was appointed as Government of India Nominee Director on the Board of the Bank by the Government of India w.e.f 14.05.2018.

Shri Hardik Mukesh Sheth was appointed as Government of India Nominee Director of Bank by the Government of India w.e.f 11.04.2022.

Shri Alok Srivastava, ceased to be Executive Director of the Bank on account of superannuation from the services of Bank on 30.11.2022.

Shri M.V Murali Krishna was appointed Executive Director of the Bank by the Government of India w.e.f 01.12.2022.

Further, Shri Priavrat Sharma was appointed as Part Time Non-Official Director under Chartered Accountant Category by the Central Government w.e.f 08.05.2023

10. Whistle Blower Policy:

Bank follows Central Vigilance Commission Guidelines on Whistle Blower complaints under Public Interest Disclosure and Protection of Informers (PIDPI) resolution. Bank has a web based portal in the name of âCent e-Whistleblowerâ to facilitate reporting of malpractices by Employees and Directors without revealing their identities, which would be known to the General Manager - Human Resources Department. Directors and Employees may also approach Chairman of the Audit Committee of the Board directly. This may help to curb malpractices, prevent frauds and boost up morale of the employees.

11. Prompt Corrective Action:

Reserve Bank of India vide their letter dated June 13, 2017, has put the Bank under Prompt Corrective Action (PCA) in view of high net NPA and negative Return on Assets. Bank has fulfilled all parameters under revised PCA framework for SCBs issued by RBI and Bank has come out of PCA vide RBI Press Release dated 20^thSeptember, 2022.

12. Performance Evaluation of The Directors and the Board:

In terms of Regulation 25 of SEBI (LODR) Regulations 2015, the performance of the Board as whole and nonindependent directors was evaluated by the Independent Directors in a separate Meeting held on 17^th March, 2023.

Further, the performance evaluation of Whole Time Directors is carried out by Committee of Board for Performance Evaluation on the basis of guidelines prescribed by Government of India. Further, Performance of non-official Directors/ Shareholder Director is done by Board of Directors on annual basis.

13. Board and Its Sub-Committees:

The composition of the Board and its Sub-committees as required to be constituted as per the SEBI (LODR) Regulations, Government of India / Reserve Bank India Guidelines and the meetings held therein are mentioned in the Corporate Governance Report.

14. Declaration by Independent Directors during the Year:

All the Independent Directors of Bank have submitted the declaration confirming that they meet the criteria of independence as provided under Regulation 25 of SEBI (LODR) Regulations, 2015.

15. Secretarial Audit:

Pursuant to Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and SEBI Circular No. CIR/CFD/CMD1/27/2019 dated February 08, 2019, Bank had appointed M/s. S.G. & Associates (proprietor Mr. Ganesh Ganpule), Practicing Company Secretaries, Mumbai as a Secretarial Auditor to undertake Secretarial audit of Bank for the financial year 2022-23. The Secretarial Audit Report is annexed to this Report.

16. Managementâs Discussion and Analysis Report:

Pursuant to Regulation 34 read with Schedule V to the Listing Regulations, Management''s Discussion and Analysis for the year under review is presented in a separate section forming part of the Annual Report.

17. Business Responsibility and Sustainability Report:

Business Responsibility and Sustainability Report as stipulated under Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been annexed to this report and also hosted on the website of the Bank (www.centralbankofindia.co.in).

18. Dividend Distribution Policy:

In accordance with the Regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Bank has formulated a Dividend Distribution Policy. The policy has been displayed on the Bank''s website at (www. centralbankofindia.co.in).

19. Directorsâ Responsibility Statement:

The Directors confirm that in the preparation of the annual accounts for the financial year ended March 31, 2023:

The applicable accounting standards have been followed along with proper explanation relating to material departure, if any; The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied; Reasonable and prudent judgement 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/ loss of the Bank for the financial year ended March 31, 2023; Proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of the applicable laws governing banks in India;

The accounts have been prepared on a going concern basis; Internal Financial Controls are adequate and were operating effectively; and Proper systems have been devised to ensure compliance with the provisions of all applicable laws and these systems are adequate and operating effectively.

20. Corporate Governance:

The Board of the Bank is committed to adopt best Corporate Governance practices in both letter and spirit. The Bank has a well-documented system and practice on Corporate Governance. The Corporate Governance Report of the Bank is annexed to this Report.

21. Acknowledgment:

The Board of Directors places on record its gratitude to the its Shareholders, Government of India, Reserve Bank of India, SEBI, Indian Bank''s Association, Customers, Depositors, Stock Exchanges Depositories, and the other Stakeholders for their valuable guidance and support. The Board acknowledges with gratitude the unstinted support and faith of its employees, customers and shareholders.

For and on behalf of the Board of Directors

[M V Rao]

Place : Mumbai Managing Director and

Date : May 24, 2023 Chief Executive Officer

Mar 31, 2022

1. Performance Highlights

Â» Total Business of the Bank stood at K 532404 crore as at March 31,2022 compared to K 506886 crore as at March 31,2021.

Â» Total Deposits stood at K 342692 crore as against K 329973 crore in March 31,2021.

Â» Total Advances of the Bank stood at K 189712 crore as against K176913 crore in March 31,2021.

Â» Total Income for the financial year ended March 31, 2022 was K 25770 crore as compared to K 25846* crore for the financial year ended March 31,2021.

Â» Non-Interest Income of the Bank stood at K 2968 crore for the financial year ended March 31,2022 compared to K 3116* crore for the financial year ended March 31,2021.

Â» Operating Profit of the Bank increased to K 5742 crore for the financial year ended March 31,2022 as compared to K 4579* crore for the corresponding previous financial year ended March 31,2021 showing increase of 25.40%.

Â» The Bank has earned Net Profit of K 1045 crore for the financial year ended March 31,2022 as compared to Net Loss of K 888 crore during previous financial year ended March 31,2021.

Â» Business per employee increased to K 17.15 crore during the financial year ended March 31, 2022 from K 15.60 crore in the previous financial year ended March 31,2021.

Â» Capital Adequacy Ratio (as per Basel-MI) stood at 13.84%@ with Tier I at 11.48% and Tier II at 2.36% for the financial year ended March 31,2022.

(@As advised by RBI in its risk assessment report, Bank has computed Capital Ratio after adjustment for reckoning NPV of non-interest bearing recapitalization bond issued by Government of India. Without considering the impact of NPV, Tier 1, Tier 2 and CRAR are 13.39%, 2.36% and 15.75% respectively)

Â» Net worth stood at K 23801.85 crore as on March 31,2022.

Â» Cash Recovery (including sale of NPA) improved to K 3266 crore in the financial year ended March 31,2022 as compared to K 2963 crore in the previous financial year ended March 31,2021.

Â» Gross NPA to Gross Advances improved to 14.84% as on March 31,2022 from 16.55% as on March 31,2021.

Â» Net NPA to Net Advances reduced to 3.97% as on March 31,2022 as against 5.77% as on March 31,2021.

Â» Provision Coverage Ratio improved to 86.69% as on March

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Â» Net Interest Margin (NIM) improved to 3.21% in the financial year ended March 31,2022 as compared to 2.78% in the Financial Year ended March 31,2021.

Â» Return on Assets (ROA) is 0.30% for the Financial Year ended March 31,2022.

Â» The credit deployment under priority sector stood at K 93887 crore during FY 2021-22. However, to take an advantage of excessive lending over ANBC in Priority Sector credit, Bank undertook sale/purchase transactions in PSLCs. During the year Bank sold PLSCs worth K 15528 crore under PS Advances.

Â» Agriculture Advance of the Bank stood at K 38635 crore for the financial year ended March 31,2022 as against K36207 crore for the previous financial year ended March 31,2021.

Â» MSME Advances for the Financial Year ended March 31, 2022 stood at K 34138.55 crore without PSLC and Investment in SIDBI is K 264.04 crore and Mudra Limited is K 31.65 crore. PSLC for the FY 2021-22 is nil.

Â» Retail Loans increased to K 52226 crore in financial year ended March 31, 2022 from K 49468 crore in financial year ended March 31,2021.

Â» Housing Loan portfolio of the Bank stood at K 30163 crore for the financial year ended March 31, 2022, registering y-o-y growth of 7.84%. Housing Loan Portfolio constitutes 57.75% of the total Retail Portfolio as on March 31,2022.

Â» There are 46 RSETIs in 9 States of the country viz. Madhya Pradesh(18), Bihar(9), Maharashtra(6), Uttar Pradesh(5), West Bengal(3), Chhattisgarh(2), Rajasthan(1), Odissa(1) and Assam(1). During the year 2021-22, the RSETIs conducted 672 training programmes and imparted training to 18589 candidates. Out of this, 5501 (i.e. 30%) trainees were settled through bank credit, wage settlement and selffinance. Credit linkage of settled candidates achieved is 2879 i.e. 16%.

Â» Bank has 2 RRBs as on 31^st March 2022 in 2 states covering 23 districts with a network of 1174 branches.

Â» Under Financial Inclusion, Bank deployed 10299 BC Agents. Bank has opened 196 Urban Financial Inclusion centres. Bank has further opened 231.41 lakh Basic Saving Bank Deposit Accounts (BSBDA) through its BCs and Branches.

Â» Total earning from Bancassurance business is K 74.36 crore for the financial year ended March 31,2022.

Â» As on 31^st March 2022, Bank has network of4528 branches, spanning 65% branches in rural & semi-urban areas, 2976 ATMs, 10 satellite offices and 1 Extension Counter across the country.

2. Income & Expenditure

Details of income and expenditure for the financial year 2021-22 are given hereunder:

(? in Crores)
		31.03.2022	31.03.2021	Variation	%
1	Interest Income	22802	22730	72	0.32
- Advances		11501	11638	(137)	-1.18
- Investments		9264	10009	(745)	-7.44
- Others		2037	1083	954	88.09
2	Non Interest Income*	2968	3116	(148)	-4.75
3	Total Income (1 2)*	25770	25846	(76)	-0.29
4	Interest Expended	13315	14485	(1170)	-8.08
- Deposits		12848	13994	(1146)	-8.19
- Others		467	491	(24)	-4.89
5	Operating Expenses	6713	6782	(69)	-1.02
- Establishment		3927	4141	(214)	-5.17
- Others		2786	2641	(145)	5.49
6	Total Expenses (4 5)	20028	21267	(1239)	-5.83
7	Spread (1-4)	9487	8245	1242	15.06
8	Operating Profit (3-6)*	5742	4579	1163	25.40
9	Provisions*	4152	5467	(1315)	-24.05
10	Provisions For Tax	672	(436)	1108	-254.16
11	Exceptional Item (expenses)	545	-	545	100
12	NET PROFIT/(LOSS) (8-9-11)	1045	(888)	1933	-217.68

* Figures have been recalculated/ regrouped wherever necessary to confirm the current year classification

3. Provisions

Details of Total Provisions of ? 4152 crore charged to the Profit and Loss Account during the financial year 2021-22 visa-vis previous financial year are detailed as under:

(? in Crores)
	31.03.2022	31.03.2021	Variation
	(FY)	(FY)
Provisions for Standard Assets	(222)	263	-184.41
Provisions for NPAs	2461	5176	-52.45
Provisions for Restructured Accounts	596	77	674.03
Provision on Investments	646	357	80.95
Provisions for Taxes	672	(436)	-254.16
Others	(1)	30	-103.33
Total	4152	5467	-24.05

4. Profitability Ratios

(In percentage)
	31.03.2022	31.03.2021
	(FY)	(FY)
Cost of Deposits	3.86	4.35
Cost of Funds	3.92	4.43
Yield on Advances	6.57	6.63
Yield on Investments	6.27	6.63
Yield on Investment (including Trading Profit)	6.59	7.53
Net Interest Margin	3.21	2.78
Cost to Income Ratio	53.90	59.70

5. Business Ratios

(In percentage)
	31.03.2022	31.03.2021
	(FY)	(FY)
Interest Income to Average Working Fund (AWF)	6.65	6.67
Non-Interest Income to AWF	0.87	0.91
Operating Profit to AWF	1.67	1.34
Return on Average Assets	0.30	(0.26)
Business Per Employee (? in crore)	17.15	15.60
Net Profit per Employee (? in lakh)	3.38	(2.74)

* Figures have been recalculated/ regrouped wherever necessary to confirm the current year classification.

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

	31.03.2022 (FY)*	31.03.2021 (FY)
	Basel-III	Basel-III
Tier-I	11.48%	12.82%
Tier-II	2.36%	1.99%
Capital Adequacy Ratio	13.84%	14.81%

*As advised by RBI in its risk assessment report, Bank has computed Capital Ratio after adjustment for reckoning NPV of non-interest bearing recapitalization bond issued by Government of India. Without considering the impact of NPV, Tier 1, Tier 2 and CRAR are 13.39%, 2.36% and 15.75% respectively.

7. NET PROFIT/LOSS

The Bank has earned net profit amounting to ? 1045 crore during the financial year ended March 31, 2022. Board of Directors has not recommended any dividend on equity shares for the Financial Year 2021-22.

8. Changes in the Board during the year

During the year under review, the following changes took place in the Board of Directors of the Bank:

1. Shri Tapan Ray, Part-time Non-official Director as well as Non-Executive Chairman ceased to be the Director of the Bank w.e.f. close of working hours on 23^rd May, 2021.

2. Smt. Mini Ipe, Shareholder Director ceased to be the Director of the Bank w.e.f. close of working hours on 30^th June, 2021.

3. Shri Dinesh Pangtey was appointed as Shareholder Director of the Bank w.e.f. 01^st July, 2021.

4. Shri Pradip Pranlal Khimani was appointed as nonofficial Director of the Bank in terms of Department of Financial Services, Government of India Notification, w.e.f. 21^st December, 2021.

The Board places on record its appreciation of valuable contribution extended by Shri Tapan Ray and Smt. Mini Ipe who ceased to be the Directors of the Bank during the Financial Year 2021-22.

9. Whistle Blower Policy

10. Prompt Corrective Action

11 Business Responsibility and Sustainability Report

annexed to this report and also hosted on the website of the Bank (www.centralbankofindia.co.in).

12. Directorsâ Responsibility Statement The Directors confirm that in the preparation of the annual accounts for the financial year ended March 31, 2022:

The applicable accounting standards have been followed along with proper explanation relating to material departure, if any;

The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

Reasonable and prudent judgement 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/ loss of the Bank for the financial year ended March 31,2022;

Proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of the applicable laws governing banks in India;

The accounts have been prepared on a going concern basis;

Internal Financial Controls are adequate and were operating effectively; and

Proper systems have been devised to ensure compliance with the provisions of all applicable laws and these systems are adequate and operating effectively.

13. Corporate Governance

The Board of the Bank is committed to adopt best Corporate Governance practices in both letter and spirit. The Bank has a well-documented system and practice on Corporate Governance.

14. Acknowledgement

The Board of Directors places on record its gratitude to the Government of India, Reserve Bank of India and the Securities and Exchange Board of India for their valuable guidance and support. The Board acknowledges with gratitude the unstinted support and faith of its employees, customers and shareholders.

For and on behalf of the Board of Directors

[M V Rao]

Place : Mumbai Managing Director and

Date : June 27, 2022 Chief Executive Officer

Mar 31, 2019

The Directors have pleasure in presenting the Annual Report of the Bank along with the Audited Statement of Accounts, the Profit and Loss accounts and the cash flow statement for the year ended March 31, 2019.

1. PERFORMANCE HIGHLIGHTS

Â® Total Business of the Bank stood at Rs.4,67,584 crore as at March 31, 2019 compared to Rs.4,72,323 crore as at March 31, 2018.

# Total Deposits stood at Rs.299855 crore in March 31, 2019 as against Rs.294839 crore in March 31, 2018.

^ Total Advances of the Bank stood at Rs.1,67,729 crore in March 31, 2019 as against Rs.1,77,484 crore in March 31, 2018

^ Total Income for the financial year ended March 31, 2019 was Rs.25,052 crore as compared to Rs.26,659 crore for the financial year ended March 31, 2018.

^ Non-Interest Income of the Bank stood at Rs.2,413 crore for the financial year ended March 31, 2019 compared to Rs.2,623 crore for the financial year ended March 31, 2018.

^ Operating Profit of the Bank increased to Rs.3,127 crore for the financial year ended March 31, 2019 as compared to Rs.2,733 crore for the corresponding previous financial year ended March 31, 2018 showing increase of 14.42%.

^ The Bank has incurred Net Loss of Rs.5,641 crore for the financial year ended March 31, 2019 as compared to Net Loss of Rs.5,105 crore during previous financial year ended March 31, 2018 primarily due to higher NPA provisions, higher slippages/ ageing and additional provision in NCLT accounts, significant decline in Trading Profit on Investments etc.

# Expenses on employees decreased by Rs.471 crore during the financial year ended March 31, 2019 to Rs.3,566 crore from Rs.4,037 crore in the previous financial year ended March 31, 2018.

# Capital Adequacy Ratio (as per Basel-II) stood at 10.13% with Tier I at 5.70% and Tier II 4.43% for the financial year ended March 31, 2019. Capital Adequacy Ratio (as per Basel-III) stood at 9.61% with Tier I at 7.49% and Tier II 2.12% for the financial year ended March 31, 2019.

Net worth stood at Rs.16,062.89 crore.

# Cash Recovery increased to Rs.5,161 crore in the financial year ended March 31, 2019 as compared to Rs.2403 crore in the previous financial year ended March 31, 2018.

# Gross NPA to Gross Advances improved to 19.29% as on March 31, 2019 from 21.48% as on March 31, 2018.

Â® Net NPA to Net Advances reduced to 7.73% as on March 31, 2019 as against 11.10% as on March 31, 2018.

^ Provision Coverage Ratio improved to 76.60% as on March 31, 2019 from 63.31% as on March 31, 2018.

# Net Interest Margin (NIM) improved to 2.54% in the financial year ended March 31, 2019 from 2.47% in the Financial Year ended March 31, 2018.

# Business per Employee stood at Rs.12.78 crore in the financial year ended March 31, 2019.

# Return on Assets (ROA) is (1.70)% for the Financial Year ended March 31, 2019.

^ The credit deployment under priority sector increased to Rs.83,201 crore in the financial year ended March 31, 2019, with a growth of Rs.366 crore over financial year ended March 31, 2018. However, to take an advantage of excessive lending over ANBC in Priority Sector credit, Bank undertook sale/purchase transactions in PSLCs. During the year Bank sold PLSCs worth Rs.27,436 crore under PS Advances and purchased PSLCs worth Rs.5,885 crore under MSME portfolio. Thus, net Sale as at the close of FY was Rs.21,551 crore. There is outstanding of RIDF to the tune of Rs.4,907.27 crore under Priority Sector of which Rs.3,075.97 crore under Agriculture as on 31.03.2019.

Â® Agriculture Advance of the Bank stood at Rs.35,655 crore for the financial year ended March 31, 2019 as against Rs.30,776 crore for the previous financial year ended March 31, 2018, registering y-o-y growth of 15.85%.

# MSME Advances for the Financial Year ended March 31, 2019 stood at Rs32,090 crore without PSLC and Investment in SIDBI and Mudra Ltd. consisting 19.13% of the total Loans & Advances.

Â® Retail Loans increased to Rs.48,666 crore in financial year ended March 31, 2019 from Rs.48,123 crore in financial year ended March 31, 2018.

Housing Loan portfolio of the Bank stood at Rs.23,301 crore for the financial year ended March 31, 2019 as against Rs.21,392 crore for financial year ended March 31, 2018, registering y-o-y growth of 8.92%. Housing Loan Portfolio constitutes 47.88 % of the total Retail Portfolio as on March 31, 2019.

# Bank has established 46 RSETIs in 9 States of the country viz. Madhya Pradesh(18), Bihar(9), Maharashtra(6), Uttar Pradesh(5), West Bengal(3), Chhattisgarh(2), Rajasthan(1), Orissa(1) and Assam(1). During the year 2018-19, the RSETIs conducted 1098 training programmes and imparted training to 31,274 candidates. Out of this, 23,142 (i.e.74%) trainees were settled through bank credit, wage settlement and self-finance. Credit linkage of settled candidates achieved is 13,227 i.e. 43%.

# Bank has 3 RRBs as on 31st March 2019 in 3 states covering 48 districts with a network of 1,629 branches.

Under Financial Inclusion, Bank has covered 4,330 villages with population above 2,000 and 18,376 villages with population below 2,000. Bank has covered all these villages through 6,387 BC Agents. Bank has opened 177 Urban Financial Inclusion centres. Bank has further opened 202 lakh Basic Saving Bank Deposit Accounts (BSBDA) through its BCs and Branches. Total balance in these accounts is Rs.3,307.16 crore as on 31st March, 2019.

Total earning from Bancassurance business is Rs.22 crore for the financial year ended March 31, 2019.

^ As on 31st March 2019, Bank has network of 4,659 branches, spanning 63.32% branches in rural & semi-urban areas, 3,966 ATMs, 10 satellite offices and 1 Extension Counter across the country.

2. INCOME & EXPENDITURE

Details of income and expenditure for the financial year 2018-19 are given hereunder:

(Rs. in Crores)

	31.03.2019	31.03.2018	Variation	%
1 INTEREST INCOME	22639	24036	(1397)	(5.81)
- Advances	12950	14478	(1528)	(10.55)
- Investments	8454	7138	1316	18.44
- Others	1235	2420	(1185)	(48.97)
2 NON INTEREST INCOME	2413	2623	(210)	(8.01)
3 TOTAL INCOME (1 2)	25052	26659	(1607)	(6.03)
4 INTEREST EXPENDED	15866	17519	(1653)	(9.44)
- Deposits	15276	16222	(946)	(5.83)
- Others	590	1297	(707)	(54.51)
5 OPERATING EXPENSES	6059	6407	(348)	(5.43)
- Establishment	3565	4037	(472)	(11.69)
- others	2494	2370	124	5.23
6 TOTAL EXPENSES (4 5)	21925	23926	(2001)	(8.36)
7 SPREAD (1-4)	6773	6517	256	3.93
8 OPERATING PROFIT (3-6)	3127	2733	394	14.42
9 PROVISIONS	8768	7838	930	11.87
10 PROVISIONS FOR TAX	(2529)	(2791)	262	(9.39)
11 NET PROFIT/(LOSS)	(5641)	(5105)	(536)

3. PROVISIONS

Details of Total Provisions of Rs.8,768 crore charged to the Profit and Loss Account during the financial year 2018-19 vis-a-vis previous financial year are detailed as under:

(Rs. in Crores)

	31.03.2019	31.03.2018	Variation
Provisions for Standard Assets	(115)	7	(122)
Provisions for NPAs	11030	10543	487
Provisions for Restructured Accounts	(425)	(951)	526
Provision on Investments	984	799	185
Provisions for Taxes	(2529)	(2791)	262
Others	(177)	231	(408)
TOTAL	8768	7838	930

4. PROFITABILITY RATIOS

(In percentage)

	31.03.2019	31.03.2018
Cost of Deposits	5.21	5.53
Cost of Funds	5.28	5.79
Yield on Advances	7.28	8.31
Yield on Investments	7.15	7.14
Net Interest Margin	2.54	2.47
Cost to Income Ratio	65.96	70.10

5. BUSINESS RATIOS

(In percentage)

	31.03.2019	31.03.2018
Interest Income to Average Working Fund (AWF)	6.81	7.59
Non-Interest Income to AWF	0.73	0.83
Operating Profit to AWF	0.94	0.86
Return on Average Assets	(170)	(161)
Business Per Employee (Rs. In crore)	12.78	12.71
Net Profit per Employee (Rs. In lakh)	(15.55)	(13.86)

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

	31.03.2019	31.03.2018
	Basel-III	Basel-III
CET 1 / Tier-1	7.49	7.01
Tier-2	2.12	2.03
Capital Adequacy Ratio	9.61	9.04

7. NET LOSS

The Bank has incurred net loss amounting to Rs.5,641 crore during the financial year ended March 31, 2019. Accordingly, Board of Directors has not recommended any dividend on equity shares for the Financial Year 2018-19.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank:

*Â§â Shri Tapan Ray was appointed as Part-time Non-official as well as Non-executive Chairman of the Bank in terms of Department of Financial Services, Government of India Notification, w.e.f. 23rd May, 2018.

# Shri Rajeev Rishi, Managing Director & Chief Executive Officer ceased to be the Director of the Bank w.e.f. 1st August, 2018.

Shri Pallav Mohapatra was appointed as Managing Director & Chief Executive Director of the Bank in terms of Department of Financial Services, Government of India Notification, w.e.f. 21st September, 2018.

*Â§â Shri Govind Mohan ceased to be Government of India Nominee Director of the Bank w.e.f. 14th May, 2018.

^ Dr. Bhushan Kumar Sinha was appointed as Government of India Nominee Director of the Bank in terms of Department of Financial Services, Government of India Notification, w.e.f. 14th May, 2018.

^ Shri B.K. Divakara, Executive Director ceased to be the Director of the Bank w.e.f. 23rd January, 2019.

Shri Alok Srivastava was appointed as Executive Director of the Bank in terms of Department of Financial Services, Government of India Notification, w.e.f. 23rd January, 2019 for a period of 3 years.

*Â§â Shri K.R. Patel, Shareholder Director ceased to be the Director of the Bank w.e.f. 1st July, 2018.

^ Smt. Mini Ipe was elected as Shareholder Director of the Bank w.e.f. 1st July, 2018.

The Board places on record its appreciation of valuable contribution extended by Shri Rajeev Rishi, Shri Govind Mohan, Shri B.K. Divakara and Shri K.R. Patel who ceased to be the Directors of the Bank during the Financial Year 2018-19.

8.1 Government of India, Ministry of Finance, Department of Financial Services vide Notification dated 26th April, 2019 nominated Shri Thomas Mathew, Regional Director Reserve Bank of India, Jammu as RBI Nominee Director in place of existing RBI Nominee Director Shri Shekhar Bhatnagar, on the Board of our Bank with immediate effect (i.e. w.e.f. 26th April, 2019) and untill further orders. The Board places on record its appreciation of valuable contribution extended by Shri Shekhar Bhatnagar during his tenure as RBI Nominee Director of the Bank.

9. RAISING OF CAPITAL THROUGH EMPLOYEE STOCK PURCHASE SCHEME (ESPS)

During the financial year 2019-20, the Bank raised Rs.212.53 crore Capital from the eligible employees under Employee Stock Purchase Scheme (ESPS). The issue under ESPS was opened for subscription on 19th March, 2019 and closed on 29th March, 2019. The Capital funds of Rs.212.53 crore was kept in Share Application Money Account as on March 31, 2019. The Bank allotted requisite 7,87,16,224 equity shares to 26,071 eligible employees on 15th May 2019.

10. WHISTLE BLOWER POLICY

Bank follows Central Vigilance Commission Guidelines on Whistle Blower complaints under Public Interest Disclosure and Protection of Informers (PIDPI) resolution. Bank also has a web based portal in the name of âCent Vigilâ to facilitate reporting malpractices by employees and directors without revealing their identities which would be known to the Chief Vigilance Officer only. Directors and Employees may also approach Chairman of the Audit Committee on need basis. This helps to curb malpractices, prevent frauds and boost up morale of the employees.

11. PROMPT CORRECTIVE ACTION

Reserve Bank of India vide their letter dated June 13, 2017, has put the Bank under Prompt Corrective Action (PCA) in view of high net NPA and negative Return on Assets. Bank believes that corrective measures arising out of the PCA will help in improving overall performance of the Bank.

12. BUSINESS RESPONSIBILITY REPORT

Business Responsibility Report as stipulated under Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been hosted on the website of the Bank (www.centralbankofindia.co.in). Any member interested in obtaining a physical copy of the same may write to the Company Secretary at the Head Office of the Bank.

13. DIRECTORSâ RESPONSIBILTY STATEMENT

^ The Directors confirm that in the preparation of the annual accounts for the financial year ended March 31, 2019:

Â® The applicable accounting standards have been followed along with proper explanation relating to material departure, if any;

^ The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

# Reasonable and prudent judgement 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/ loss of the Bank for the financial year ended March 31, 2019;

# Proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of the applicable laws governing banks in India;

# The accounts have been prepared on a going concern basis;

# Internal Financial Control are adequate and were operating effectively; and

^ Proper systems have been devised to ensure compliance with the provisions of all applicable laws and these systems were adequate and operating effectively.

14. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

15. ACKNOWLEDGEMENT

For and on behalf of the Board of Directors

Sd/-

Place : Mumbai Tapan Ray

Date : May 22, 2019 Chairman

Mar 31, 2018

1. PERFORMANCE HIGHLIGHTS

Total Business of the Bank stood at Rs.472323 crore as at March 31, 2018 compared to Rs.449679 crore as at March 31, 2017.

- Total Deposits stood at Rs.294839 crore in March 31, 2018 as against Rs.296671 crore in March 31, 2017.

- Total Advances of the Bank increased to Rs.177484 crore in March 31, 2018 as against Rs.153008 crore in March 31, 2017 registering y-o-y growth of 16%.

- Total Income for the financial year ended March 31, 2018 was Rs.26659 crore as compared to Rs.27537 crore for the financial year ended March 31, 2017.

- Non-Interest Income of the Bank stood at Rs.2623 crore for the financial year ended March 31, 2018 compared to Rs.2876 crore for the financial year ended March 31, 2017.

Operating Profit of the Bank stood at Rs.2733 crore for the financial year ended March 31, 2018 as compared to Rs.3089 crore for the corresponding previous financial year ended March 31, 2017.

- The Bank has incurred Net Loss of Rs.5105 crore for the Financial Year ended March 31, 2018 as compared to Net Loss of Rs.2439 crore during previous financial year ended March 31, 2017 primarily due to higher NPA provisions, higher slippages/ ageing and additional provision in NCLT accounts, significant decline in Trading Profit on Investments, decline in net interest income etc.

- Expenses on employees decreased by Rs.230 crore during the financial year ended March 31, 2018to Rs.3984 crore from Rs.4214 crore in the previous financial year ended March 31, 2017.

- Capital Adequacy Ratio (as per Basel-II) stood at 9.46% with Tier I at 5.50% and Tier II 3.96% for the financial year ended March 31, 2018. Capital Adequacy Ratio (as per Basel III) stood at 9.04% with Tier I at 7.01% and Tier II 2.03% for the financial year ended March 31, 2018.

- Net worth stood at Rs.14845 crore.

Cash Recovery increased to Rs.2403 crore in the financial year ended March 31, 2018 as compared to Rs.2378 crore in the previous financial year ended March 31, 2017.

- Gross NPA to Gross Advances stood at 21.48% as on March 31, 2018 as against 17.81% as on March 31, 2017. Net NPA to Net Advances stood at 11.10% as on March 31, 2018 as against 10.20% as on March 31, 2017.

- Provision Coverage Ratio improved to 63.31% as on March 31, 2018 from 58.43% as on March 31, 2017.

- Net Interest Margin (NIM) stood at 2.47% in the Financial Year ended March 31, 2018.

- Business per Employee stood at Rs.12.71 crore in the Financial Year ended March 31, 2018.

- Return on Assets (ROA) is (1.61)% for the Financial Year ended March 31, 2018.

- The credit deployment under priority sector increased to Rs.82834.61 crore during 2017-18, recording a growth of Rs.9484.37 crore over previous year. However, to take an advantage of excessive lending over ANBC in Priority Sector credit, Bank undertook sale/purchase transactions in PSLCs. During the year Bank sold PLSCâs worth Rs.22030 crore under PS Advances and purchased PSLCâs worth Rs.7524.50 crore under MSME portfolio. Thus, net Sale as at the close of FY was Rs.14505.50 crore. Bank also sold IBPC of Rs.1500 crore under Priority sector advances. Inspite of aforesaid sale; Bankâs PS lending is in excess by Rs.6669.28 crore to ANBC.

- Agriculture Advance of the Bank stood at Rs.30,776 crore for the financial year ended March 31, 2018.

MSME Advances for the Financial Year ended March 31, 2018 stood at Rs.34,025 crore constituting 19.17% of the total loans and advances.

Retail Loans increased by 50.35% to Rs.48,123 crore in March 2018 from Rs.32,008 crore in March 2017. Bank had launched intensive programme âRetail Dhamakaâ in December 2017 to boost Retail Credit. Proposals amounting to Rs.4980 crore were sanctioned during the campaign period.

- Housing Loan portfolio of the Bank stood at Rs.21,392 crore in March, 2018 as against Rs.12,510 crore in March, 2017, registering y-o-y growth of 71.00%. Housing Loan Portfolio constitutes 44.45% of the total Retail Portfolio as on March 31, 2018.

- Bank has established 46 RSETIs in 9 States of the country viz. Madhya Pradesh(18), Bihar(9), Maharashtra(6), Uttar Pradesh(5), West Bengal(3), Chhattisgarh(2), Rajasthan(1), Orissa(1) and Assam(1). During the year 201718, the RSETIs conducted 1280 training programmes and imparted training to 33,428 candidates. Out of this, 23403 (i.e.70%) trainees were settled through Bank credit, wage settlement and self-finance.

- Bank has 3 RRBs as on 31st March 2018 in 3 states covering 48 districts with a network of 1629 branches.

- Under Financial Inclusion, Bank has covered 4,330 villages with population above 2000 and 18,376 villages with population below 2000. Bank has covered all these villages through 6,387 BC Agents. Bank has opened 177 Urban Financial Inclusion centres. Bank has further opened 184.19 lakhs Basic Saving Bank Deposit Accounts (BSBDA) through its BCs and Branches. Total balance in these accounts is Rs.2567 crore as on 31st March, 2018.

- Total earning from Bancassurance business is Rs.21.42 crore for the financial year ended March 31, 2018.

- As on 31st March 2018, Bank has network of 4685 branches, 4886 ATMs, 10 satellite offices and 1 Extension Counter across the country.

2. INCOME & EXPENDITURE

Details of income and expenditure for the financial year 2017-18 are given hereunder:

(Rs. in Crores)

	31.03.2018	31.03.2017	Variation	%
1 INTEREST INCOME	24036	24661	(625)	(2.53)
- Advances	14478	16283	(1805)	(11.09)
- Investments	7138	7372	(234)	(3.17)
- Others	2420	1006	1414	140.56
2 NON INTEREST INCOME	2623	2876	(253)	(8.80)
3 TOTAL INCOME (1 2)	26659	27537	(878)	(3.19)
4 INTEREST EXPENDED	17519	18087	(568)	(3.14)
- Deposits	16222	17330	(1108)	(6.39)
- Others	1297	757	540	71.33
5 OPERATING EXPENSES	6407	6361	46	0.72
- Establishment	3984	4214	(230)	(5.46)
- Others	2423	2147	276	12.86
6 TOTAL EXPENSES (4 5)	23926	24448	(522)	(2.14)
7 SPREAD (1-4)	6517	6574	(57)	(0.87)
8 OPERATING PROFIT (3-6)	2733	3089	(356)	(11.52)
9 PROVISIONS	7838	5528	2310	41.79
10 PROVISIONS FOR TAX	(2791)	(1090)	(1701)	156.06
11 NET PROFIT/(LOSS)	(5105)	(2439)	(2666)

3. PROVISIONS

Details of Total Provisions of Rs.7838 crore charged to the Profit and Loss Account during the financial year 2017-18 vis-a-vis previous financial year are detailed as under:

(Rs. in Crores)

	31.03.2018	31.03.2017	Variation
Provisions for Standard Assets	7	(164)	171
Provisions for NPAs	10543	6216	4327
Provisions for Restructured Accounts	(951)	321	(1272)
Provision on Investments	799	300	499
Provisions for Taxes	(2791)	(1090)	(1701)
Others	231	(55)	286
TOTAL	7838	5528	2310

4. PROFITABILITY RATIOS

(In percentage)

	31.03.2018	31.03.2017
Cost of Deposits	5.53	6.20
Cost of Funds	5.79	6.27
Yield on Advances	8.31	9.01
Yield on Investments	7.14	7.38
Net Interest Margin	2.47	2.51
Cost to Income Ratio	70.10	67.31

5. BUSINESS RATIOS

(In percentage)

	31.03.2018	31.03.2017
Interest Income to Average Working Fund (AWF)	7.59	8.10
Non-Interest Income to AWF	0.83	0.94
Operating Profit to AWF	0.86	1.01
Return on Average Assets	(161)	(0.80)
Business Per Employee (â in crore)	12.71	11.81
Net Profit per Employee (â in lakh)	(13.86)	(6.49)

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

	31.03.2018		31.03.2017
	Basel-II	Basel-III	Basel-II	Basel-III
Tier-I	5.50	7.01	6.87	8.62
Tier-II	3.96	2.03	3.50	2.33
Capital Adequacy Ratio	9.46	9.04	10.37	10.95

7. NET LOSS

The Bank has incurred net loss amounting to Rs.5105 crore during the financial year ended March 31, 2018. Accordingly, Board of Directors has not recommended any dividend on equity shares for the Financial Year 2017-18.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank:

- Dr. Saurabh Garg ceased to be the Director of the Bank w.e.f. close of working hours on 16th August, 2017 in terms of Notification of Ministry of Finance, Government of India.

- Shri Govind Mohan was appointed as Government of India Nominee Director of the Bank w.e.f 17th August, 2017 vide Government of India Notification dated 17th August, 2017.

- Shri B. S. Shekhawat was appointed as Executive Director of the Bank w.e.f 09th October, 2017 for a period of 3 years.

- Prof (Dr.) Atmanand was appointed as Part time Non Official Director of the Bank for a period of 3 years w.e.f. 27th December, 2017.

- Shri Supratim Bandyopadhyay ceased to be Shareholder Director of the Bank w.e.f. close of working hours on 17th March, 2018 consequent upon his appointment as Whole-time Member (Finance) in Pension Fund Regulatory and Development Authority (PFRDA).

The Board places on record its appreciation of valuable contribution extended by Dr. Saurabh Garg and Shri Supratim Bandyopadhyay who ceased to be the directors of the Bank during the Financial Year 2017-18.

8.1 Government of lndia, Ministry of Finance, vide Notification dated 14th May 2018 has nominated Dr. Bhushan Kumar Sinha, Economic Adviser, Government of India, Ministry of Finance, Department of Financial Services, as Government Nominee Director in place of existing Government Nominee Director- Shri Govind Mohan, on the Board of our Bank with immediate effect (i.e. with effect from 14th May 2018) and until further orders. Dr. Sinha belongs to the 1993 batch of Indian Economic Service. Presently he is posted as Economic Adviser in the Department of Financial Services (DFS), Ministry of Finance, Government of India, New Delhi. Before joining DFS in May 2018, Dr Sinha had a three year stint as Economic Adviser in the Department of Investment & Public Asset Management (DIPAM). Dr. Sinha holds a Masterâs degree in Business Administration (MBA) from the National Graduate School of Management (NGSM), Australian National University (ANU), Canberra, Australia and a Ph.D from the Department of Financial Studies, University of Delhi.

8.2 Government of lndia, Ministry of Finance, Department of Financial Services vide notification dated 23rd May 2018 has appointed Shri Tapan Ray as Part-time Non-official Director as well as Non-Executive Chairman in Central Bank of India for a period of three years from the date of notification of his appointment (i.e. with effect from 23rd May 2018), or until further orders, whichever is earlier. Shri Tapan Ray retired as Secretary (Corporate Affairs), Government of India after 35 years in the Gujarat cadre of the IAS. He has a Degree in Mechanical Engineering from the Indian Institute of Technology, Delhi. He is also a Post Graduate in Public Policy from the Woodrow Wilson School, Princeton University USA, and a Master of Public Administration from the Maxwell School, Syracuse University, USA. He also holds degrees in Law and International Trade. He has served in the Ministries of Defence, Textiles, Power, Science & Technology, Information Technology and Planning in the Government of India. He has been Principal Secretary in the Finance Department in Gujarat. Shri Ray has a wide corporate experience of over 12 years in various companies of Government of Gujarat as well as Government of India. He has been the Managing Director of the Gujarat State Petroleum Corporation and its group companies for about 5 years. As Secretary (Corporate Affairs), he has served on the Board of SEBI.

9. WHISTLE BLOWER POLICY

10. PROMPT CORRECTIVE ACTION

11. BUSINESS RESPONSIBILITY REPORT

12. DIRECTORSâ RESPONSIBILTY STATEMENT

The Directors confirm that in the preparation of the annual accounts for the financial year ended March 31, 2018:

- The applicable accounting standards have been followed along with proper explanation relating to material departure, if any;

- The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

- Reasonable and prudent judgement 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 financial year ended March 31,2018;

- Proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of the applicable laws governing banks in India ; and

- The accounts have been prepared on a going concern basis;

- Internal Financial Control are adequate and were operating effectively; and

Proper systems have been devised to ensure compliance with the provisions of all applicable laws and these systems were adequate and operating effectively.

13. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

14. ACKNOWLEDGEMENT

For and on behalf of the Board of Directors

Sd/-

Place : Mumbai Rajeev Rishi

Date : May 25, 2018 Managing Director & Chief Executive Officer

Mar 31, 2017

_DIRECTORSâ REPORT 2016-17_

Your Directors have pleasure in presenting the Annual Report of the Bank along with the Audited statement of Accounts, the

Profit and Loss accounts and the cash flow statement for the year ended March 31, 2017.

1. PERFORMANCE HIGHLIGHTS

- Total Business of the Bank stood at Rs. 449679 crore as at March 31, 2017 compared to Rs. 456336 crore as at March 31, 2016.

- Total Deposits reached to Rs. 296671 crore in March 2017 from Rs. 266184 crore as at March, 2016 showing a y-o-y growth of 11.45 %.

- Total Advances of the Bank stood at Rs. 153008 crore in March 2017 as against Rs. 190152 crore in March 2016 which was due to sale of loan assets of Rs. 22991.22 crore through IBPC participation.

- Total Income for the financial year ended March 31, 2017 was Rs. 27537 crore as compared to Rs.27825 crore for the financial year ended March 31, 2016.

- Non Interest Income of the Bank increased to Rs. 2876 crore for the financial year ended March 31, 2017 compared to Rs. 1938 crore for the financial year ended March 31, 2016, registering y-o-y growth of 48.38 %.

- Operating Profit of the Bank stood at Rs. 3089 crore for the financial year ended March 31, 2017 as compared to Rs. 2642 crore for the corresponding previous financial year ended March 31, 2016, registering y-o-y growth of 16.92 %.

- Net Loss for the quarter ended March 31, 2017 reduced to Rs. 592 crore in comparison to Net Loss of Rs. 898 crore for the quarter ended March 31, 2016. Net Loss of the Bank stood at Rs. 2439 crore for the financial year ended March 31, 2017.

- Expenses on employees decreased by Rs. 251 crore during the year to Rs. 4214 crore from Rs. 4465 crore in previous year.

- Capital Adequacy Ratio (as per Basel-II) stood at 11.28 per cent with Tier I at 7.16 percent as against 11.07 per cent in previous year. Capital Adequacy Ratio (as per Basel III) stood at 10.95 per cent with Tier I at 8.62 percent as against 10.41 per cent in previous year.

- Net worth stood at Rs. 14735.84 crore.

- Cash Recovery increased to Rs. 2378 crore in the financial year ended March 31, 2017 as compared to Rs.1287 crore in the previous financial year ended March 31, 2016.

- Up gradation of assets improved to Rs. 1183 crore in the financial year March 31, 2017 as compared to Rs.608 crore in the previous financial year ended March 31, 2016.

- Gross NPA to Gross Advances increased to 17.81 % as on March 31, 2017 from 11.95 % as on March 31, 2016, which was due to sale of loan assets of Rs. 22991.22 crore through IBPC participation.

- Net NPA to Net Advances increased to 10.20 % as on March 31, 2017 from 7.36 % as on March 31, 2016.

- Provision Coverage Ratio improved to 58.43% as on March 31, 2017 from 51.52 % as on March 31, 2016.

- Net Interest Margin (NIM) stood at 2.51 per cent in FY 2016-17.

- Business per Employee stood at Rs.11.81 crore in FY 2016-17.

- Return on Assets (ROA) is (0.80) per cent for the financial year ended March 31, 2017.

- The credit deployment under priority sector increased from Rs.82771 crore to Rs.88085.80 crore during 2016-17, recording a growth of Rs.5314.80 crore over previous year. However, to take a benefit of excessive lending in PS advances, Bank sold PSLCs worth Rs.1065 crore and IBPC Rs.8761.80 crore Inspire of the sale; Bank''s PS lending is in excess by Rs.1621.40 crore.

- Agriculture Advance of the Bank increased to Rs.37537 crore from Rs.36760 crore in FY 2016-17 registering y-o-y growth of 2.11 per cent.

- MSME Advances for the Financial Year ended March 31, 2017 stood at Rs. 30701 crore constituting 20.06 % of the total loans and advances.

- Retail Loans for the Financial Year ended March 31, 2017 stood at Rs. 32008 crore constituting 20.92% of the total loans & advances.

- Housing Loan portfolio of the Bank stood at Rs. 12510 crore constituting 39.08 % of the total Retail Portfolio as on March 31, 2017.

- Bank has established 46 Rural Self Employment and Training Institute (RSETIs) in 9 States of the country viz. Madhya Pradesh(18), Bihar(9), Maharashtra(6), Uttar Pradesh(5), West Bengal(3), Chhattisgarh(2), Rajasthan(1), Orissa(1) and Assam(1). During the year 2016-17, the RSETIs conducted 1153 training programmes and imparted training to 31961 candidates. Out of this, 26511 (i.e.83%) trainees were settled through bank credit, wage settlement and self-finance.

- Bank has 3 RRBs as on 31^st March 2017 in 3 states covering 47 districts with a network of 1629 branches.

- Under Financial Inclusion Bank has covered 4,330 villages with population above 2000 and 18,376 villages with population below 2000. Bank has covered all these villages through 6,387 BC Agents. We have opened 176 Urban Financial Inclusion centres. Bank has opened 170.89 lacs Basic Saving Bank Deposit Accounts (BSBDA) through its BCs and Branches. Total balance in these accounts is 2070.14 crores as on 31^st March, 2017.

- Total earning from Ban assurance business is Rs. 17.07 crore for FY 2016-17.

- As on 31^st March 2017, Bank has a network of 4714 branches, 3677 ultra-small branches (USBs), 5285 ATMs, 10 Satellite Offices & 1 Extension Counters across the country.

2. INCOME & EXPENDITURE

Details of income and expenditure for the period 2016-17 are given hereunder:

Rs. In Crores

		31.03.2017	31.03.2016	Variation	%
1	INTEREST INCOME	24661	25887	(1226)	(4.73)
	- Advances	16283	18978	(2695)	(14.20)
	- Investments	7372	6474	898	13.87
	- Others	1006	435	571	131.26
2	NON INTEREST INCOME	2876	1938	938	48.40
3	TOTAL INCOME (1 2)	27537	27825	(288)	(103)
4	INTEREST EXPENDED	18087	18822	(735)	(3.90)
	- Deposits	17330	17653	(323)	(183)
	- Others	757	1169	(412)	(54.43)
5	OPERATING EXPENSES	6361	6361	0	0
	- Establishment	4214	4465	(251)	(5.62)
	- Others	2147	1896	251	13.24
6	TOTAL EXPENSES (4 5)	24448	25183	(735)	(2.92)
7	SPREAD (1-4)	6574	7065	(491)	(6.95)
8	OPERATING PROFIT (3-6)	3089	2642	447	16.91
9	PROVISIONS	5528	4060	1468	36.15
10	PROVISIONS FOR TAX	(1090)	(1251)	161	(12.87)
11	NET PROFIT/(LOSS)	(2439)	(1418)	(1021)	(72.00)

3. PROVISIONS

Details of Total Provisions of Rs.5528 crore charged to the Profit and Loss Account during the year 2016-17 vis-a-vis previous year are detailed as under:

(Rs. in crore)

	31.03.2017	31.03.2016	Variation
Provisions for Standard Assets	(164)	470	(634)
Provisions for NPAs	6216	4913	1303
Provisions for Restructured Accounts	321	(1235)	1556
Provision on Investments	300	851	(551)
Provisions for Taxes	(1090)	(1251)	161
Others	(55)	312	(367)
TOTAL	5528	4060	1468

4. PROFITABILITY RATIOS

(In percentage)

	31.03.2017	31.03.2016
Cost of Deposits	6.20	6.86
Cost of Funds	6.27	6.95
Yield on Advances	9.01	10.09
Yield on Investments	7.38	7.46
Net Interest Margin	2.51	2.78
Cost Income Ratio	67.31	70.65

5. BUSINESS RATIOS

(In percentage)

	31.03.2017	31.03.2016
Interest Income to Average Working Fund (AWF)	8.10	8.85
Non-Interest Income to AWF	0.94	0.66
Operating Profit to AWF	1.01	0.90
Return on Average Assets	(0.80)	(0.48)
Business Per Employee (Rs. in crore)	11.81	11.95
Net Profit per Employee (Rs. in lakh)	(6.49)	(3.76)

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

	31.03.2017		31.03.2016
	Basel-II	Basel-III	Basel-II	Basel-III
Tier-I	7.16	8.62	7.44	8.20
Tier-II	4.12	2.33	3.63	2.21
Capital Adequacy Ratio	11.28	10.95	11.07	10.41

7. NET LOSS

The Bank has incurred net loss amounting to Rs.2439 crore during the financial year ended March 31, 2017. Accordingly, Board of Directors has not recommended any dividend on equity shares for the Financial Year 2016-17.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank:

- Shri S. B. Rode ceased to be the Officer Employee Director of the Bank w.e.f. close of working hours on 01.04.2016 consequent upon completion of his tenure.

- Shri N. Nityananda was appointed as Part-time Non-official Director under Chartered Accountant Category for a period of three years w.e.f 21^st June 2016.

- Shri Gurbax Kumar Joshi ceased to be the Workmen Employee Director of the Bank w.e.f. close of working hours on 09.07.2016 consequent upon completion of his tenure.

- Smt N. S. Rathnaprabha ceased to be the Part-Time Non-official Director of the Bank w.e.f. close of working hours on 18.12.2016 consequent upon completion of her three years'' tenure.

- Shri R. K. Goyal retired from the position of Executive Director of the Bank w.e.f. close of working hours on

31.12.2016 on attaining superannuation.

- Shri P. Ramana Murthy was appointed as Executive Director of the Bank for a period of 3 years w.e.f. 17.02.2017.

- Shri R. C. Lodha retired from the position of Executive Director of the Bank w.e.f. close of working hours on

28.02.2017 on attaining superannuation.

The Board places on record its appreciation of valuable contribution extended by Shri S. B. Rode, Shri Gurbax Kumar Joshi, Smt N. S. Rathnaprabha, Shri R. K. Goyal and Shri R. C. Lodha who ceased to be the directors of the Bank during the Financial Year 2016-17.

9. WHISTLE BLOWER POLICY

10. BUSINESS RESPONSIBILITY REPORT

Business Responsibility Report as stipulated under Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been hosted on the website of the Bank (www. centralbankofindia.co.in). Any member interested in obtaining a physical copy of the same may write to the Company Secretary at the Head Office of the Bank.

11. DIRECTORSâ RESPONSIBILTY STATEMENT

The Directors confirm that in the preparation of the annual accounts for the financial year ended March 31, 2017:

- The applicable accounting standards have been followed along with proper explanation relating to material departure, if any;

- The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

- Reasonable and prudent judgment and estimates were made so as to give 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 financial year ended March 31,2017;

- Proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of the applicable laws governing banks in India ; and

- The accounts have been prepared on a going concern basis;

- Internal Financial Control are adequate and were operating effectively; and

- Proper systems have been devised to ensure compliance with the provisions of all applicable laws and these systems were adequate and operating effectively.

12. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

13. ACKNOWLEDGMENT

For and on behalf of the Board of Directors

Sd/-

Place : Mumbai Rajeev Rishi

Date : May 23, 2017 Chairman & Managing Director

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Annual Report of the Bank along with the Audited statement of Accounts, the Profit and Loss accounts and the cash flow statement for the year ended March 31,2015.

1. PERFORMANCE HIGHLIGHTS

- Total Business of the Bank increased by Rs. 27149 crore to Rs. 450539 crore from Rs. 423390 crore in previous year, registering y-o-y growth of 6.41 per cent.

- Total Deposits increased by Rs.15503 crore to Rs. 255572 crore, registering y-o-y growth of 6.46 per cent.

- Total Advances of the Bank grew by Rs. 11646 crore to Rs. 194967 crore, registering y-o-y growth of 6.35 per cent. Operating Profit increased to Rs. 3559 crore from Rs. 3238 crore in FY 2013-14, registering y-o-y growth of 9.91 per cent.

- Net Profit stood at Rs. 606 crore in 2014-15 as against net loss of Rs. 1263 crore in FY 2013-14, thereby registering y-o-y growth of 147.98 per cent.

- Capital Adequacy Ratio (as per Basel-II) stood at 11.89 per cent with Tier I at 8.46 percent as against 11.96 per cent in previous year. Capital Adequacy Ratio (as per Basel III) stood at 10.90 per cent with Tier I at 8.05 percent as against 9.87 per cent in previous year.

- Net worth increased to Rs. 15643 crore from Rs. 13918 crore.

- Gross NPA of the Bank increased by Rs. 373 crore to Rs. 11873 crore from Rs. 11500 crore in previous year. In percentage term Gross NPA has decreased to 6.09 per cent in FY 2014-15 from 6.27 per cent in last year.

Net NPA increased to Rs.6807 crore from Rs.6649 crore in previous year. Net NPA percentage has decreased to 3.61 per cent from 3.75 per cent in previous year.

- Provision Coverage Ratio (PCR) improved to 55.16 per cent from 50.68 per cent in March 2014.

Net Interest Margin (NIM) improved to 2.79 per cent from 2.73 per cent in FY 2013-14.

- Business per Employee increased to Rs. 1138 lakh from Rs. 1025 lakh in previous year.

Return on Assets (ROA) is 0.21 per cent for the current financial year.

- Credit to Priority Sector increased to Rs. 75997 crore from Rs. 68652 crore in previous year, recording y-o-y growth of 10.70 per cent.

- Agriculture Advance of the Bank increased to Rs. 35,957 crore from Rs. 35,387 crore in FY 2013-14 registering y-o-y growth of 1.61 per cent.

- Under the micro credit & other (credit upto Rs. 50,000 per borrower), Bank has extended credit of Rs. 206 crore.

- Advances to Micro & Small Enterprises (MSE) increased to Rs. 26503 crore during the year under review from Rs. 21515 crore in previous year.

- Education Loan grew by 15.50 per cent during the year and the total loan reached to Rs. 3442 crore.

- Bank has established 46 Rural Self Employment and Training Institute (RSETIs) in 9 States of the country viz. Madhya Pradesh(18), Bihar(9), Maharashtra(6), Uttar Pradesh(5), West Bengal(3), Chhattisgarh(2), Rajasthan(1), Orissa(1) and Assam(1). During the year 2014-15, the RSETIs conducted 891 training programmes and imparted training to 24290 candidates. Out of this, 14816 (i.e.61%) trainees were settled through bank credit, wage settlement and self-finance.

- Bank has 3 RRBs as on 31st March 2015 in 3 states covering 47 districts with a network of 1622 branches.

- Under Financial Inclusion Bank has covered 4,330 villages with population above 2000 and 18,371 villages with population below 2000. Bank has covered all these villages through 6,382 BC Agents. We have also opened 238 Branches in unbanked rural centres. Bank has opened all its 3677 Ultra Small Branches attached to 1427 Base Branches. Bank has opened 146.71 lacs Basic Saving Bank Deposit Account (BSBDA) accounts through its BCs and Branches. Total balance in these accounts is 763.99 crores as on 31st March, 2015.

- Under Pradhan Mantri Jan Dhan Yojana our Bank has opened 57.35 lacs BSBD accounts and increased business with a deposit of Rs.317.82 Crores.

- The corporate credit of the Bank decreased to Rs. 97,608 crore from Rs. 97,568 crore in previous year registering y-o-y reduction of 0.04 per cent.

The retail credit grew by 21.27 per cent from Rs. 28,811 crore in FY 2013-14 to Rs. 34,939 crore in FY 2014-15.

Total earning from Bancassurance business is Rs. 25.27 crore for FY 2014-15.

- As on 31st March 2015, Bank has a network of 4689 branches, 3677 Ultra - Small Branches (USBs), 4835 ATMs 29 Satellite Offices & 4 Extension Counters across the country.

2. INCOME & EXPENDITURE

Details of income and expenditure for the period 2014-15 are given hereunder: Rs. In Crores

31.03.2015 31.03.2014 Variation %

1 INTEREST INCOME 26409 24427 1982 8.11

-Advances 19517 18620 897 4.82

-Investments 6707 5764 943 16.36

-Others 185 43 142 330.23

2 OTHER INCOME 1894 1923 (29- (1.51)

3 TOTAL INCOME (1 2) 28303 26350 1953 7.41

4 INTEREST EXPENDED 19162 17933 1229 6.85

- Deposits 17520 16374 1146 7.00

- Others 1642 1559 83 5.32

5 OPERATING EXPENSES 5582 5179 403 7.78

- Establishment 3825 3537 288 8.14

- others 1757 1642 115 7.00

6 TOTAL EXPENSES (4 5) 24744 23112 1632 7.06

7 SPREAD (1-4) 7247 6494 753 11.60

8 OPERATING PROFIT (3-6)3559 3238 321 9.93

9 PROVISIONS-NPA/INVST./ OTHERS 2669 4233 (1564) (36.95)

10 PROVISIONS FOR TAX 284 268 16 5.97

11 NET PROFIT 606 (1263) 18691 147.98

Interest Income grew by 8.11 per cent during the year

Interest expenses on Deposits increased by 7.00 per cent to Rs. 17520 crore in March 2015 from Rs. 16374 crore in previous year.

Expenses on employees increased by Rs. 288 crore during the year to Rs. 3825 crore from Rs. 3537 crore in previous year.

3. PROVISIONS

Details of Total Provisions of Rs.2953 crore charged to the Profit and Loss Account during the year 2014-15 vis-a-vis previous year are detailed as under:

(Rs. in crore)

31.03.2015 31.03.2014 Variation

Provisions for Standard Assets 39 (7) 46

Provisions for NPAs 2610 3989 (1379)

Provision on Investments (21) 258 (279)

Provisions for Taxes 284 268 16

Others 41 (7) 43

TOTAL 2953 4501 (1548)

4. PROFITABILITY RATIO

(In percentage)

31.03.2015 31.03.2014

Cost of Deposits 7.22 7.24

Cost of Funds 7.34 7.37

Yield on Advances 10.75 10.79

Yield on Investments 8.22 7.84

Net Interest Margin 2.79 2.73

Cost Income Ratio 61.07 61.53

5. BANKING RATIOS

(In percentage)

2014-15 2013-14

Interest Income to Average Working Fund (AWF) 9.29 9.18

Non-Interest Income to AWF 0.67 0.72

Operating Profit to AWF 1.25 1.22

Return on Average Assets 0.21 --

Business Per Employee (Rs. in lakh) 1138 1025

Net Profit per Employee (Rs. in lakh) 153 --

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

31.03.2015 31.03.2014

Basel-II Basel-III Basel-II Basel-III

Tier-I 8.46 8.05 8.12 7.37

Tier-II 3.43 2.85 3.84 2.50

Capital Adequacy Ratio 11.89 10.90 11.96 9.87

7. NET PROFIT & DIVIDEND

The Bank earned Net Profit of Rs. 606 crore for the financial year 2014-15. The Board of Directors are pleased to recommend a dividend @ 5 per cent on the Equity Share Capital i.e. Rs. 0.50/- per equity share of Rs.10/- each.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank:

- Shri Guman Singh ceased to be the Part-Time Non-official Director of the Bank w.e.f. August 08, 2014 consequent upon expiry of his term on August 07, 2014.

- Shri Animesh Chauhan ceased to be the Executive Director of the Bank w.e.f. 31st December, 2014 upon elevation as Managing Director & Chief Executive Officer of Oriental Bank of Commerce.

- Prof. N. Balakrishnan, who was elected as Shareholder Director of the Bank under section 9(3)(i) of Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 for a period of three years from January 10, 2012 has ceased to be the Director of the Bank w.e.f. close of working hours on January 09, 2015 consequent upon completion of his tenure.

The Board places on record its appreciation of valuable contribution extended by Shri Guman Singh, Shri Animesh Chauhan and Prof. N. Balakrishnan who ceased to be the directors of the Bank during Financial Year 2014-15.

9. WHISTLE BLOWER POLICY

Bank follows Central Vigilance Commission Guidelines on Whistle Blower complaints under Public Interest Disclosure and Protection of Informers (PIDPI) resolution. Bank also has a web based portal in the name of "Cent Vigil" to facilitate reporting malpractices by employees and directors without revealing their identities which would be known to the Chief Vigilance Officer only. Directors and Employees may also approach Chairman of the Audit Committee on need basis. This helps to curb malpractices, prevent frauds and boost up morale of the employees.

10. DIRECTORS'' RESPONSIBILTY STATEMENT

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 departure, if any;

- The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

- Reasonable and prudent judgement 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 the applicable laws governing banks in India ; and

- The accounts have been prepared on a going concern basis.

- Internal Financial Control are adequate and were operating effectively.

- Proper systems have been devised to ensure compliance with the provisions of all applicable laws and these systems were adequate and operating effectively.

11. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

12. ACKNOWLEDGEMENT

The Board of Directors places on record its gratitude to the Government of India, Reserve Bank of India and the Security Exchange Board of India for their valuable guidance and support. The Board acknowledges with gratitude the unstinted support and faith of its customers and shareholders. The Board wishes to place on record its appreciation of the dedicated services and contribution made by members of staff for the overall performance of the Bank.

For and on behalf of the Board of Directors Sd/-

Place : Delhi Rajeev Rishi

Date : May 25, 2015 Chairman & Managing Director

Mar 31, 2014

The Directors have pleasure in presenting the Annual Report of the Bank along with the Audited statement of Accounts, the Profit and Loss accounts and the cash fow statement for the year ended March 31, 2014.

1. PERFORMANCE HIGHLIGHTS

- Total Business of the Bank increased by Rs. 21118 crore to Rs. 423390 crore from Rs. 402272 crore in previous year, registering y-o-y growth of 5.25 percent.

- Total Deposits increased by Rs.14031 crore to Rs. 240069 crore, registering y-o-y growth of 6.21 per cent.

- Total Advances of the Bank grew by Rs. 7087 crore toRs. 183321 crore, registering y-o-y growth of 4.02 per cent.

- Operating Profit increased to Rs. 3238 crore from Rs. 3173 crore in FY 2012-13, registering y-o-y growth of 2.05 per cent. However, the Bank incurred Net Loss of Rs. 1263 Crore in the financial year ended 31st March, 2014 due to higher provisions on NPAs.

- Capital Adequacy Ratio (as per Basel-II) stood at 11.96 per cent with Tier I at 8.12 percent as against 11.49 per cent in previous year. Capital Adequacy Ratio ( as per Basel III) stood at 9.87 per cent with Tier I at 7.37 percent

- Net worth increased to Rs. 13918 crore from Rs. 13443 crore.

- Gross NPA of the Bank increased by Rs. 3044 crore to Rs. 11500 crore From Rs. 8456 crore in previous year. In percentage term Gross NPA increased to 6.27 per cent in FY 2013-14 from 4.80 per cent in last year.

- Net NPA increased to Rs.6649 crore from Rs.4988 crore in previous year. Net NPA percentage increased to 3.75 per cent from 2.90 per cent in previous year.

- Provision Coverage Ratio (PCR) increased to 50.68 per cent from 47.75 per cent in March 2013.

- Net Interest Margin (NIM) improved to 2.73 per cent from 2.65 per cent in FY 2012-13.

- Business per Employee reduced to Rs. 1025 lakh from Rs. 1067 lakh in previous year.

- Return on Assets (ROA) is negative for the financial year 2013-14 as the Bank incurred losses.

- Credit to Priority Sector increased to Rs. 68648 crore from Rs. 51259 crore in previous year, recording y-o-y growth of 33.92 per cent.

- Agriculture Advance of the Bank increased to Rs. 35382 crore from Rs. 24658 crore in FY 2012-13 registering y-o-y growth of 43.49 per cent.

- Under the micro credit & other (credit up to Rs. 50,000 per borrower), Bank has extended credit of Rs. 261 crore.

- Advances to Micro & Small Enterprises (MSE) increased to Rs. 21515 crore during the year under review from Rs. 17300 crore in previous year.

- During the year 65939 new Self Help Groups (SHGs) were formed, out of which 60278 SHGs have been credit-linked.

- Under the Government Sponsored Programmes, Bank has provided assistance to 31658 NRLM/SGSY beneficiaries, 13195 SJSRY beneficiaries & 7474 PMEGP borrowers during the year 2013-14.

- Bank has extended loan of Rs. 20953 crore to the borrowers belonging to the weaker section of the society.

- Education Loan grew by 16.09 per cent during the year and the total loan reached to Rs. 2980 crore.

- Bank has established 46 Rural Self Employment and Training Institute (RSETI) across India. During the year 2013-14, the RSETIs conducted 677 training programmes and imparted training to 18837 candidates. Out of this, 10550 (56%) trainees were linked to Bank''s credit.

- At the beginning of the year, the Bank had 5 sponsored Regional Rural Banks (RRBs) covering 54 Districts with a network of 1799 Branches, out of which 2 RRBs were merged with other RRBs, sponsored by other Banks. As a result now we have 3 RRBs as on 31st March, 2014 in 3 States covering 46 Districts with a network of 1609 Branches.

- Under Financial Inclusion Bank has covered 4330 villages with population above 2000 and 6743 villages with population below 2000. Bank has covered all these villages through 5588 BC Agents. Bank has opened all its 3677 Ultra Small Branches. Bank has opened 92.27 lac Basic Saving Bank Deposit Accounts through BCs and Branches up to 31st March, 2014.

- The corporate credit of the Bank decreased to Rs. 97613 crore from Rs. 112067 crore in previous year registering y-o-y reduction of 12.90%.

V1 The retail credit grew by 29.73% from Rs. 22209 crore in FY 2012-13 to Rs. 28811 crore in FY 2013-14.

- Total earning from Banc assurance business is Rs. 26.65 crore with y-o-y growth of 8%.

- As on 31st March 2014, Bank has a network of 4573 branches, 29 Satellite Offices & 4 Extension Counters across the country.

- Bank has installed 3628 ATMs till 31st March 2014.

2. INCOME & EXPENDITURE

Details of income and expenditure for the period 2013-14 are given hereunder:

Rs. In Crores 31.03.2014 31.03.2013 Variation %

1 INTEREST INCOME 24427 21861 2566 11.74

- Advances 18620 16922 1698 10.03

- Investments 5764 4779 985 20.61

- Others 43 160 (117) (73.13)

2 OTHER INCOME 1923 1667 256 15.36

3 TOTAL INCOME (1 2) 26350 23528 2822 11.99

4 INTEREST EXPENDED 17933 16123 1810 11.23

- Deposits 16374 14940 1434 9.60

- Others 1559 1183 376 31.78

5 OPERATING EXPENSES 5179 4232 947 22.38

- Establishment 3537 2891 646 22.35

- others 1642 1341 301 22.45

6 TOTAL EXPENSES (4 5) 23112 20355 2757 13.54

7 SPREAD (1-4) 6494 5738 756 13.18

8 OPERATING PROFIT (3-6) 3238 3173 65 2.05

9 PROVISIONS-NPA/ INVST./OTHERS 4233 1853 2380 128.44

10 PROVISIONS FOR TAX 268 305 (37) (12.13)

11 NET PROFIT (1263) 1015 (2278) (224.43)

- Interest Income grew by 11.74 per cent during the year

- Interest expenses on Deposits increased by 9.60 % to Rs. 16374 crore in March 2014 from Rs. 14940 crore in previous year.

- Expenses on employees increased by Rs. 646 crore during the year to Rs. 3537 crore from Rs. 2891 crore in previous year, which includes Rs. 140 crore towards provision for Wage settlement.

3. PROVISIONS

Details of Total Provisions of Rs.4501 crore charged to the profit and Loss Account during the year 2013-14 vis-a-vis previous year are detailed as under:

(Rs. in crore)

31.03.2014 31.03.2013 Variation

Provisions for Standard Assets (7) 91 (98)

Provisions for NPAs 3989 1930 2059

Depreciation/Provision on Investments 258 (163) 421

Provisions for Taxes 268 305 (37)

Others (7) (5) (2)

TOTAL 4501 2158 2343

4. PROFITABILITY RATIO

(In percentage)

31.03.2014 31.03.2013

Cost of Deposits 7.24 7.42

Cost of Funds 7.37 7.53

Yield on Advances 10.79 11.14

Yield on Investments 7.84 7.61

Net Interest Margin 2.73 2.65

Cost Income Ratio 61.53 57.16

- The yield on advances was 10.79 per cent in 2013-14 and yield on investments was 7.84 per cent against 7.60 per cent in 2012-13.

- Net Interest Margin increased to 2.73 per cent from 2.65 per cent in previous year.

- Cost to Income Ratio increased from 57.16 per cent in 2013 to 61.53 per cent in the year under review.

5. BANKING RATIOS

(In percentage)

2013-14 2012-13

Interest Income to Average Working Fund (AWF) 9.18 9.46

Non-Interest Income to AWF 0.72 0.72

Operating profit to AWF 1.22 1.37

Return on Average Assets - 0.44

Business Per Employee (Rs. in lakh) 1025 1067

Net profit per Employee (Rs. in lakh) - 2.83

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR) The components of Capital Adequacy Ratio were as under:

31.03.2014 31.03.2013

Basel-II Basel-III Basel-II Basel-III

Tier-I 8.12 7.37 8.09 Not Applicable

Tier-II 3.84 2.50 3.40 Not Applicable

Capital Adequacy Ratio 11.96 9.87 11.49 Not Applicable

7. NET LOSS

The Bank has incurred loss amounting to Rs.1263 crore during the financial year March 31, 2014. Board of Directors has not recommended any dividend on equity shares and Perpetual Non cumulative Preference Shares due to the net loss incurred by the Bank during the Financial Year ended 31st March, 2014.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank: 9 Shri S B Rode was appointed as Officer Employee Director w.e.f 02.04.2013.

- Shri Gurbax Kumar Joshi was appointed as Workmen Employee Director w.e.f 10.07.2013.

- Dr. K P Krishnan was appointed as Government Nominee Director of the Bank w.e.f 26.07.2013 in place of Shri Alok Tandon who ceased to be the Government Nominee Director on 25.07.2013.

- Shri Rajeev Rishi was appointed as Chairman & Managing Director of the Bank w.e.f 01.08.2013 in place of Shri Mohan V Tanksale who ceased to be the Chairman & Managing Director on 31.07.2013.

- Shri Animesh Chauhan was appointed as Executive Director of the Bank w.e.f 05.08.2013.

- Shri Malay Mukherjee ceased to be the Executive Director w.e.f 11.12.2013.

- Smt N S Rathnaprabha was appointed Part Time Non-official Director w.e.f 19.12.2013.

- Shri B K Divakara was appointed as Executive Director of the Bank w.e.f 23.01.2014.

- Dr. Saurabh Garg was appointed as Government Nominee Director of the Bank w.e.f 19.02.2014 in place of Dr. K P Krishnan who ceased to be the Government Nominee Director on 18.02.2014.

- Shri Shekhar Bhatnagar was appointed as RBI Nominee Director of the Bank w.e.f 13.03.2014 in place of Shri Salim Gangadharan who ceased to be the RBI Nominee Director on 12.03.2014.

The Board places on record its appreciation of valuable contribution extended by Shri Alok Tandon, Shri M V Tanksale, Shri Malay Mukherjee, Dr. K P Krishnan and Shri Salim Gangadharan who ceased to be the directors of the Bank during Financial Year 2013-14.

9. DIRECTORS'' RESPONSIBILTY STATEMENT

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 departure, if any;

- The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

- Reasonable and prudent judgment and estimates were made so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year ended March 31,2014;

- Proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of the applicable laws governing banks in India ; and

- The accounts have been prepared on a going concern basis.

10. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

11. ACKNOWLEDGEMENT

The Board of Directors places on record its gratitude to the Government of India, Reserve Bank of India and the Security Exchange Board of India for their valuable guidance and support. The Board acknowledges with gratitude the unstilted support and faith of its customers and shareholders. The Board wishes to place on record its appreciation of the dedicated services and contribution made by members of staff for the overall performance of the Bank.

For and on behalf of the Board of Directors

Sd/-

Place : Mumbai Rajeev Rishi

Date : May 20, 2014 Chairman & Managing Director

Mar 31, 2013

The Directors have pleasure in presenting the Annual Report of the Bank along with the Audited statement of Accounts, the Profit and Loss accounts and the cash flow statement for the year ended March 31, 2013.

1. PERFORMANCE HIGHLIGHTS

- Total Business of the Bank increased by Rs.55374 crore to Rs.402272 crore from Rs. 346898 crore in previous year, registering y-o-y growth of 15.96 per cent.

- Total Deposits increased by Rs.29865 crore to Rs.226038 crore, registering y-o-y growth of 15.22 per cent.

- Gross Advance of the Bank grew by Rs.25509 crore to Rs.176234 crore, registering y-o-y growth of 16.92 per cent.

- Operating Profit increased to Rs.3173 crore from Rs.2815 crore in FY 2011-12, registering y-o-y growth of 12.72 per cent.

- Net Profit stood at Rs.1015 crore in 2012-13 as against Rs.533 crore in FY 2011-12, registering y-o-y of 90.43 per cent.

- Capital Adequacy Ratio (as per Basel-II) stood at 11.49 per cent as against 12.40 per cent in previous year.

- Net worth increased to Rs.13443.12 crore from Rs.10550.44 crore.

& Gross NPA of the Bank increased by Rs.1183 crore to Rs.8456 crore from Rs.7273 crore in previous year. In percentage term Gross NPA reduced to 4.80 per cent in FY 2012-13 from 4.83 per cent in last year.

Net NPA increased to Rs.4988 crore from Rs.4557 crore in previous year. Net NPA percentage decreased to 2.90 per cent from 3.10 per cent in previous year.

Provision Coverage Ratio (PCR) increased to 47.75 per cent from 40.62 per cent in March 2012.

- Net Interest Margin (NIM) reduced to 2.65 per cent from 2.78 per cent in FY 2011-12.

- Average Business per Employee increased to Rs.973 lakh from Rs.862 lakh in previous year.

- Net Profit per Employee increased to Rs.2.83 lakh from Rs.1.51 lakh in March 2012.

Return on Assets (ROA) improved to 0.44 per cent from 0.26 per cent in March 2012.

Credit to Priority Sector increased to Rs.51252 crore from Rs.40259 crore in previous year, recording y-o-y growth of 27.31 per cent.

- Agriculture Advance of the Bank increased to Rs.24660 crore from Rs.18848 crore in FY 2011-12 registering y-o-y growth of 30.84 per cent.

Under the micro credit & other (credit upto Rs.50,000 per borrower), Bank has extended credit of Rs.233 crore.

Advances to Micro & Small Enterprises (MSE) increased to Rs.17289 crore during the year under review from Rs.13161 crore in previous year.

- During the year 13957 new Self Help Groups (SHGs) were formed, out of which 12397 SHGs have been credit- linked.

Under the Government Sponsored Programmes, Bank has provided assistance to 15047 SGSY beneficiaries, 11384 SJSRY beneficiaries & 1302 PMEGP borrowers during the year 2012-13.

Bank has extended loan of Rs.15521 crore to the borrowers belonging to the weaker section of the society.

Education Loan grew by 19.01 per cent during the year and the total loan reached to Rs.2567 crore.

- Bank has established 46 Rural Self Employment and Training Institute (RSETI) across India.

At the beginning of the year, the Bank had 7 sponsored Regional Rural Banks (RRBs) covering 57 Districts in 7 states with a network of 1806 Branches, out of which 2 RRBs were merged with other RRBs and 2 RRBs sponsored by other Banks merged with our Central Madhya Pradesh Gramin Bank. As on 31.03.2013, we had 5 RRBs spread over 54 districts in 5 states with network of 1799 branches.

Bank was allotted 3728 villages with population above 2000. Bank has covered all these villages with 116 Branches and 3612 BC Agents. Bank has opened all its 3612 Ultra Small Branches.

The corporate credit of the Bank increased to Rs.120328 crore from Rs.98960 crore in previous year registering y-o-y growth of 21.59%.

- The retail credit grew by 31.30% from Rs.16915 crore in FY 2011-12 to Rs.22209 crore in FY 2012-13.

"Cent Combo" - A Combination of Home Loan & Vehicle Loan at attractive Rates and at affordable EMIs and Hassle Free Loan Sanction Process was introduced with lowest EMI of Rs. 896/- per Lakh for Home Loans upto 30 years and lowest EMI of Rs. 1673/- per Lakh for Vehicle Loans upto 84 months. The scheme has been designed keeping the corporate sector employees in view.

- During the year 2012-13, Bank has earned commission of Rs.15.23 crore in life insurance and Rs.9.02 crore in non-life insurance business.

All 77 Regions have been declared as BIMA Region and 835 branches as BIMA Banks by LIC.

As on 31st March 2013, Bank has a network of 4294 branches across the country. During the year 283 branches have been opened, which includes 13 extension counters converted to full-fledged branches.

- Bank has installed 2529 ATMs till 31st March 2013.

Under the organizational re-structuring process, Bank has delegated more powers to the Regional Managers to ensure decision making faster and Zonal Managers will work as Business Facilitator for Regional Offices for achieving Corporate Goals.

2. INCOME & EXPENDITURE

Details of income and expenditure for the period 2012-13 are given hereunder:

Rs. in crore

31.03.2013 31.03.2012 Variation %

1 INTEREST INCOME 21861 19150 2711 14.16

-Advances 16922 14421 2501 17.34

-Investments 4779 4347 432 9.94

-Others TM 160 382 (222) (58.12) 2 OTHER INCOME 1667 1395 272 1950 (Profit on Sale of Investments)

3 TOTAL INCOME (1 2) 23528 20545 2983 1452

4 INTEREST EXPENDED 16123 13981 2142 1532

-Deposits 14940 12996 1944 1496

-Others 1183 985 198 2010

5 OPERATING EXPENSES 4232 3749 483 1288

-Establishment 2891 2506 385 15.36

-others 1341 1243 98 7.88

6 TOTAL EXPENSES (4 5) 20355 17730 2625 1481

7 SPREAD (1-4) 5738 5169 569 1101

8 OPERATING PROFIT (3-6) 3173 2815 358 12/72

9 PROVISIONS-NPA/INVST. /OTHERS 1853 2169 (316) (14.57)

10 PROVISIONS FOR TAX 305 113 192 169.91

11 NET PROFIT 1015 533 482 90.43

Interest Income grew by 14.16 per cent during the year

Interest expenses on Deposits increased by 14.96 % to Rs.14940 crore in March 2013 from Rs.12996 crore in previous year.

- Expenses on employees increased by Rs.385 crore during the year to Rs.2891 crore from Rs.2506 crore in previous year, due to provisioning requirement of Rs.100 crore for expected Wage settlement.

3. PROVISIONS

Details of Total Provisions of Rs.2158 crore charged to the Profit and Loss Account during the year 2012-13 vis-a-vis previous year are detailed as under:

(Rs. in crore)

31.03.2013 31.03.2012 Variation

Provisions for Standard Assets 91 54 37

Provisions for NPAs 1930 1962 (32)

Depreciation/Provision on Investments (163) 151 (314)

Provisions for Taxes 305 113 192

Others (5) 2 (7)

TOTAL 2158 2282 (124)

4. PROFITABILITY RATIO

(In percentage)

31.03.2013 31.03.2012

Cost of Deposits 7.42 7.20

Cost of Funds 7.53 7.28

Yield on Advances 11.14 11.36

Yield on Investments 7.60 7.53

Net Interest Margin 2.65 2.78

Cost Income Ratio 57.16 57.11

Cost of Deposits increased from 7.20 per cent in 2012 to 7.42 per cent in 2013.

The yield on advances was 11.14 per cent in 2012-13 and yield on investments was 7.60 per cent against 7.53 per cent in 2011-12.

- Net Interest Margin reduced to 2.65 per cent from 2.78 per cent in previous year.

- Cost to Income Ratio increased from 57.11 per cent in 2012 to 57.16 per cent in the year under review.

5. BANKING RATIOS

(In percentage)

2012-13 2011-12

Interest Income to Average Working Fund (AWF) 9.46 9.22

Non-Interest Income to AWF 0.72 0.67

Operating Profit to AWF 1.37 1.36

Return on Average Assets 0.44 0.26

Business Per Employee (Rs. in lakh) 973 862

Net Profit per Employee (Rs. in lakh) 2.83 1.51

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

31.03.2013 31.03.2012 Basel-I Basel-II Basel-I Basel-II

Risk Weighted Assets (Rs. in crore) 182530351 177658071 1479581 140823

Capital Funds (in percentage)

Tier-I 7.95 8.09 7.50 7.79

Tier-II 3.38 3.40 4.46 4.61

Capital Adequacy Ratio 11.33 11.49 11.96 12.40

7. NET PROFIT & DIVIDEND

The Bank earned Net Profit of Rs.1015 crore for the financial year 2012-13. The Board of Directors are pleased to recommend a dividend @ 25 per cent on the Equity Share Capital i.e. Rs.2.50/- per equity share of Rs.10/- each.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank:

Shri Malay Mukherjee was appointed as Executive Director of the Bank w.e.f 05.11.2012 in place of Smt V.R.Iyer who ceased as Executive Director on 05.11.2012.

Shri R.K.Goyal was appointed as Executive Director of the Bank w.e.f 11.01.2013 in place of Shri R.K.Dubey who ceased as Executive Director on 11.01.2013.

Shri Brijlal Kshatriya ceased to be the Shareholders'' Director w.e.f 20.03.2013.

Shri Romesh Sabharwal and Major (Retd) Ved Prakash, Part Time Non-Official Directors ceased to be the Directors of the bank w.e.f 06.10.2012 and 20.10.2012 respectively consequent upon expiry of their tenures.

Shri M.P.Shorawala and Shri Krishan Sethi were appointed as Part Time Non-Official Directors of the Bank w.e.f 03.01.2013 and 28.02.2013 respectively.

Shri B.S.Rambabu ceased to be the Workmen Employee Director of the Bank w.e.f 15.03.2013.

The Board places on record its appreciation of valuable contribution extended by Smt.V.R.Iyer, Shri R.K. Dubey, Shri Brijlal Kshatriya, Shri Romesh Sabharwal, Major (Retd) Ved Prakash and Shri B.S. Rambabu who ceased to be the directors of the Bank during Financial Year 2012-13.

9. DIRECTORS'' RESPONSIBILTY STATEMENT

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 departure, if any;

The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

Reasonable and prudent judgement 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 the applicable laws governing banks in India ; and

The accounts have been prepared on a going concern basis.

10. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

11. ACKNOWLEDGEMENT

The Board of Directors places on record its gratitude to the Government of India, Reserve Bank of India and the Security Exchange Board of India for their valuable guidance and support. The Board acknowledges with gratitude the unstinted support and faith of its customers and shareholders. The Board wishes to place on record its appreciation of the dedicated services and contribution made by members of staff for the overall performance of the Bank.

For and on behalf of the Board of Directors

Sd/-

Place : Mumbai Mohan V Tanksale

Date : May 31, 2013 Chairman & Managing Director

Mar 31, 2012

The Directors have pleasure in presenting the Bank's Annual Report of the Bank along with the Audited statement of Accounts, the Profit and Loss accounts and the cash flow statement for the year ended March 31, 2012.

1. PERFORMANCE HIGHLIGHTS

- Total Business of the Bank increased by Rs. 36135 crore to Rs. 346898 crore from Rs. 310763 crore in previous year, registering y-o-y growth of 11.63 per cent.

- Total Deposits increased by Rs. 16817 crore to Rs. 196173 crore, registering y-o-y growth of 9.38 per cent.

- Gross Advance of the Bank grew by Rs. 19318 crore to Rs. 150725 crore, registering y-o-y growth of 14.70 per cent.

- Operating Profit increased to Rs. 2815 crore from Rs. 2591 crore in 2010-11 , registering y-o-y growth of 8.65 per cent

- Net Profit stood at Rs. 533 crore in 2011-12 as against Rs. 1252 crore in 2010-11.

- Capital Adequacy Ratio (as per Basel-II) improved to 12.40 per cent from 11.68 per cent in previous year.

- Net worth increased to Rs. 10550.44 crore from Rs. 6909.54 crore.

- Gross NPA of the Bank increased by Rs. 4879 crore to Rs. 7273 crore from Rs. 2394 crore in previous year. In percentage term Gross NPA increased to 4.83 per cent in 2011-12 from 1.82 per cent in last year.

- Net NPA increased to Rs. 4557 crore from Rs. 847 crore in previous year. Net NPA percentage increased to 3.09 per cent from 0.65 per cent in previous year.

- Net Interest Margin (NIM) reduced to 2.78 per cent from 3.31 per cent in 2011.

- Average Business per Employee increased to Rs. 862 lakh from Rs. 835 lakh in previous year.

- Net Profit per Employee reduced to Rs. 1.51 lakh from Rs. 3.96 lakh in March 2011.

- Credit to Priority Sector increased to Rs. 40749 crore from Rs. 37469 crore in previous year, recording y-o-y growth of 8.76 per cent.

- Agriculture Advance of the Bank increased to Rs. 18950 crore from Rs. 18545 crore in 2010-11.

- Under the micro credit (credit up to Rs. 50,000 per borrower), Bank has extended credit of Rs. 216 crore.

- Advances to Micro & Small Enterprises (MSE) increased to Rs. 13518 crore during the year under review from Rs. 10999 crore in previous year.

- During the year 13256 new Self Help Groups (SHGs) were formed, out of which 6797 SHGs have been credit- linked.

- Under the Government Sponsored Programmes, Bank has provided assistance to 13525 SGSY beneficiaries, 4137 SJSRY beneficiaries & 6244 PMEGP borrowers during the year 2011-12.

- Bank has extended loan of Rs. 13214 crore to the borrowers belonging to the weaker section of the society.

- Education Loan grew by 32.95 per cent during the year and the total loan reached to Rs. 2058 crore.

- Bank has established 46 Rural Self Employment and Training Institute (RSETI) across India.

- Bank has sponsored 7 Regional Rural Banks (RRBs) covering 57 districts of 7 states with 1806 branches.

- A target of 3725 villages (having population over 2000) have been allotted under Financial Inclusion Plan. Bank has covered all the villages by 21st December 2011, well before the targeted time of 31st March 2012.

- The corporate credit of the Bank increased to Rs. 106758 crore from Rs. 84995 crore in previous year registering y-o-y growth of 25.61%.

- The retail credit grew by 39.72% from Rs. 12522 crore in 2010-11 to Rs. 17496 crore in 2011-12.

- Cent Param - Salary Account Scheme introduced specially for the armed and para military force with attractive features like free remittances, retail loans at concessional rates, customized credit cards etc.

- During the year 2011-12, Bank has earned commission of Rs. 13.53 crore in life insurance & Rs. 6.30 crore in non-life insurance business.

- Our 67 Regions have been declared as BIMA Region and 800 branches as BIMA Banks by LIC.

- Bank has introduced Family Floater Rural Health Insurance Scheme with the tie-up arrangement with general insurance partner Chola MS.

- A new recovery scheme "Krishak Rahat Yojana" introduced for the recovery in NPA accounts of Tractor/ Agriculture Loans and Rs. 15.51 crore has been recovered during the year.

- During the year, 7303 recovery camps were organized at different locations across the country and recovered Rs. 745 crore.

- As on 31st March 2012, Bank has a network of 4011 branches across the country. During the year 283 branches have been opened, which includes 121 extension counters and 5 satellite offices converted to full-fledged branches.

- Bank has installed 1682 ATMs till 31st March 2012.

- Under the organizational re-structuring process, Bank has delegated more powers to the Regional Managers to ensure decision making faster and Zonal Managers will work as Business Facilitator for Regional Offices for achieving Corporate Goals.

2. INCOME & EXPENDITURE

Details of income and expenditure for the period 2011-12 are given hereunder:

Rs. in crore

31.03.2012 31.03.2011 Variation %

1 INTEREST INCOME 19150 15221 3929 25.81

-Advances 14421 11254 3167 28.14

-Investments 4347 3767 580 15.40

-Others 382 200 182 91.00

2 OTHER INCOME 1395 1265 130 10.28

(Profit on Sale of Investments)

3 TOTAL INCOME (1 2) 20545 16486 4059 24.62

4 INTEREST EXPENDED 13981 9895 4086 41.29

-Deposits 12996 9063 3933 43.40

-Others 985 832 153 18.39

5 OPERATING EXPENSES 3749 4000 -251 -6.28

-Establishment 2506 2964 -458 -15.45

-others 1243 1036 207 19.98

6 TOTAL EXPENSES (4 5) 17730 13895 3835 27.60

7 SPREAD (1-4) 5169 5326 -157 -2.95

8 OPERATING PROFIT (3-6) 2815 2591 224 8.65

9 PROVISIONS-NPA/INVST./ OTHERS 2169 932 1237 132.73

10 PROVISIONS FOR TAX 113 407 -294 -72.24

11 NET PROFIT 533 1252 -719 -57.43

- Interest Income grew by 25.81 per cent during the year

- Interest expenses on Deposits increased by 43.40 % to Rs. 12996 crore in March 2012 from Rs. 9063 crore in previous year.

- Expenses on employees reduced by Rs. 458 crore during the year to Rs. 2506 crore from Rs. 2964 crore in previous year, due to reduced provisioning requirement for pension.

3. PROVISIONS

Details of Total Provisions of Rs. 2282 crore charged to the Profit and Loss Account during the year 2011-12 vis-a-vis previous year are detailed as under:

(Rs. in crore)

31.03.2012 31.03.2011 Variation

Provisions for Standard Assets 54 106 -52

Provisions for NPAs 1962 632 1330

Depreciation/Provision on Investments 151 154 -3

Provisions for Taxes 113 407 -294

Others 2 40 -38

TOTAL 2282 1339 943

4. SPREAD ANALYSIS

(In percentage)

31.03.2012 31.03.2011

Cost of Deposits 7.20 5.71

Cost of Funds 7.28 5.82

Yield on Advances 11.36 10.29

Yield on Investments 7.53 7.45

Net Interest Margin 2.78 3.31

Cost Income Ratio 57.11 60.68

- Cost of Deposits increased from 5.71 per cent in 2011 to 7.20 per cent in 2012.

- The yield on advances was 11.36 per cent in 2011-12 and yield on investments was 7.53 per cent against 7.45 per cent in 2010-11.

- Net Interest Margin reduced to 2.78 per cent from 3.31 per cent in previous year.

- Cost to Income Ratio decreased from 60.68 per cent in 2011 to 57.11 per cent in the year under review.

5. BANKING RATIOS (In percentage)

2011-12 2010-11

Interest Income to Average Working Fund (AWF) 9.22 8.49

Non-Interest Income to AWF 0.67 0.71

Operating Profit to AWF 1.36 1.45

Return on Average Assets 0.26 0.70

Business Per Employee (Rs. in lakh) 862 835

Net Profit per Employee (Rs. in lakh) 1.51 3.96

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

31.03.2012 31.03.2011

Basel-I Basel-II Basel-I Basel-II

Risk Weighted Assets(Rs in crore) 147958 140823 128587 116619 Capital Funds (in percentage)

Tier-I 7.50 7.79 5.81 6.31

Tier-II 4.46 4.61 4.93 5.33

Capital Adequacy Ratio 11.96 12.40 10.74 11.64

7. NET PROFIT & DIVIDEND

The Bank earned Net Profit of Rs. 533 crore for the financial year 2011-12. Despite lower profit, believing in the intrinsic strength of the Bank, the Board of Directors are pleased to recommend dividend @ 20 per cent on the Equity share Capital i.e. Rs. 2/- per Equity Share of Rs. 10/- each.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank:

- Shri Mohan V. Tanksale was appointed as Chairman & Managing Director of the Bank in place of Shri S. Sridhar who retired as Chairman & Managing Director on 31.05.2011. Shri Mohan V. Tanksale took over the charge of the Bank w.e.f. 29.06.2011.

- Shri Alok Tandon was appointed as Govt. of India Nominee Director w.e.f. 15.11.2011 in place of Dr. Shashank Saksena who ceased to be a Director on the Board of the Bank on 14.11.2011.

- The term of Shri Brijlal Kshatriya and Prof. N. Balakrishnan as Shareholders' Director completed on 19.11.2011. Both the Directors were re-elected as Shareholders' Director w.e.f. 10.01.2012.

- Shri Guman Singh was appointed as Part Time Non Official Independent Director w.e.f. 08.08.2011.

9. DIRECTORS' RESPONSIBILTY STATEMENT

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 departure, if any;

- The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

- Reasonable and prudent judgement 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 the applicable laws governing banks in India ; and

- The accounts have been prepared on a going concern basis.

10. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

11. ACKNOWLEDGEMENT

The Board of Directors places on record its gratitude to the Government of India, Reserve Bank of India and the Security and Exchange Board of India for their valuable guidance and support. The Board acknowledges with gratitude the unstinted support and faith of its customers and shareholders. The Board wishes to place on record its appreciation of the dedicated services and contribution made by members of staff for the overall performance of the Bank.

For and on behalf of the Board of Directors

Place : Mumbai Mohan V Tanksale

Date : May 24, 2012 Chairman & Managing Director

Mar 31, 2011

The Directors have pleasure in presenting the Banks Annual Report of the Bank along with the Audited statement of Accounts, the Profit and Loss accounts and the cash flow statement for the year ended March 31, 2011.

1. PERFORMANCE HIGHLIGHTS

. Total Business of the Bank increased by Rs. 41538 crore to Rs. 310763 crore, registering y-o-y growth of 15.43 per cent.

. Total Deposits increased by Rs. 17249 crore to Rs. 179356 crore, registering y-o-y growth of 10.64 per cent.

. Gross Advance of the Bank grew by Rs. 24289 crore to Rs. 131407 crore, registering y-o-y growth of 22.67 per cent.

. Operating Profit increased by Rs. 533 crore to Rs. 2591 crore , registering y-o-y growth of 25.90 per cent

. Net Profit increased by Rs. 194 crore to Rs. 1252 crore, registering y-o-y growth of 18.35 per cent.

. Capital Adequacy Ratio (as per Basel-II) reduced to 11.64 per cent from 12.23 per cent in previous year.

. Net worth increased by Rs. 1181 crore to Rs. 6909.54 crore, registering y-o-y of 20.68 per cent.

. Gross NPA of the Bank reduced by Rs. 64 crore to Rs. 2394 crore from Rs. 2458 crore in previous year. In percentage term Gross NPA reduced to 1.82 per cent from 2.29 per cent in last year.

. Net NPA increased from Rs. 727 crore to Rs. 847 crore in previous year. Net NPA percentage reduced to 0.65 per cent from 0.69 per cent in previous year.

. Net Interest Margin (NIM) stood at 3.31 per cent against 1.86 per cent in 2010.

. Average Business per Employee increased to Rs. 835 lakh from Rs. 712 lakh in previous year.

. Net Profit per Employee increased to Rs. 3.96 lakh from Rs. 3.30 lakh in March 2010.

. Credit to Priority Sector increased to Rs. 41949 crore from Rs. 35393 crore in previous year, recording y-o-y growth of 18.52 per cent.

. Agriculture Advance of the Bank grew by 8.08 per cent, contributing a share of 18.64 per cent in Net Bank Credit, which is above the RBIs norms of 18 per cent.

. 7387 beneficiaries were issued Cent Janata Credit Cards during the year.

. 11877 Self Help Groups formed during the year out of which 11159 groups were credit linked.

. Advances to MSE grew by 27.73 per cent from Rs. 9317 crore in year 2010 to Rs. 11901 crore. Sixty branches have been identified for focus attention for MSE finance.

. 1776 villages with the population over 2000 have been brought under Financial Inclusion Plan.

. Retail loans of the Bank grew by 26.29 per cent from Rs. 11190 crore (2010) to Rs. 14132 crore. The share of Retail Loan in Gross Advance was 10.75 per cent.

. Education Loan grew by 31.18 per cent during the year and the total loan reached to Rs. 1548 crore.

. Housing Loan portfolio (up to Rs. 20 lakh) shown a growth of 14.41% and reached to Rs. 7001 crore.

. E-stamping started in the states of Delhi, Karnataka and Tamil Nadu to provide stamping facility.

. Electronic uploading of Central Civil Pension has been started.

. Bank has been appointed as Registrar by the Unique Identification Authority of India for carrying out enrolment work for issuance of Unique ID on pan India basis.

. Corporate Credit increased from Rs. 75616 crore to Rs. 93554 crore registering a growth of 23.72 per cent during the year.

. Bank has opened 82 new branches during the year and having network of 3728 branches as on 31st March 2011.

. All branches have been brought under CBS platform.

. E-treasury of the Bank made fully operationalised.

. Bank has obtained license to open NRI branches in Anand, Margao, Hyderabad and Bhuj .

. Bank has signed two MoU for establishing joint venture banks Ã one at Maputo, in the Republic of Mozambique and the other at Thimpu in Bhutan.

. The name of "Centbank Financial and Custodial services Ltd.Ã has been changed as "Centbank Financial Services LimitedÃ.

. Bank has made cash recovery of Rs. 736 crore in NPA accounts.

. Bank has offered & successfully completed Right Issue of Rs. 2497 crores in March / April 2011. The Rights Issue ratio was 3:5 and was oversubscribed by 1.07 times.

. Bank own the Skoch Financial Inclusion Award 2011 for implementing the Bihar Rural Livelihood Project also known as JEEVIKA Project and My FM stars of the Industry Retail Leadership Award in February 2011.

2. INCOME & EXPENDITURE

Details of income and expenditure for the period 2010-11 are given hereunder:

Rs. in crore

31.03.2011 31.03.2010 Variation %

1 INTEREST INCOME 15221 12064 3157 26.17

- Advances 11254 8648 2606 30.13

- Investments 3767 3307 460 13.91

- Others 200 109 61 83.49

2 OTHER INCOME 1265 1735 -470 -27.09

(Profit on Sale of Investments)

3 TOTAL INCOME (1+2) 16486 13799 2687 19.47

4 INTEREST EXPENDED 9895 9519 376 3.95

- Deposits 9063 9121 -58 -0.64

- Others 832 398 434 109.05

5 OPERATING EXPENSES 4000 2222 1778 80.02

- Establishment 2964 1544 1420 91.97

- others 1036 678 358 52.80

6 TOTAL EXPENSES (4+5) 13895 11741 2154 18.35

7 SPREAD (1-4) 5326 2545 2781 109.27

8 OPERATING PROFIT (3-6) 2591 2058 533 25.90

9 PROVISIONS-NPA/INVST./OTHERS 932 509 423 83.10

10 PROVISIONS FOR TAXATION 407 491 -84 -17.11

11 NET PROFIT 1252 1058 194 18.34

. Interest Income grew by 26.17 per cent during the year

. Net Interest Income registered a growth of 109.27 percent

. Interest expenses on Deposits reduced to Rs. 9063 in March 2011 from Rs. 9121 crore in previous year, because of maturity of high cost deposits.

. Expenses on employees has gone up by 91.97% because of salary revision for staff & officers and provision of pension & gratuity.

3. PROVISIONS

Details of Total Provisions of Rs. 1339 crore charged to the Profit and Loss Account during the year 2010-11 vis-a-vis previous year are detailed as under:

(Rs. in crore)

31.03.2011 31.03.2010 Variation Provisions for Standard Assets 106 30 76

Provisions for NPAs 632 288 344

Depreciation/Provision on Investments 154 65 89

Provisions for Taxes 407 491 -84

Others 40 126 -86

TOTAL 1339 1000 339

4. SPREAD ANALYSIS

(In percentage)

31.03.2011 31.03.2010

Cost of Deposits 5.71 6.29

Cost of Funds 5.82 6.34

Yield on Advances 10.29 9.82

Yield on Investments 7.14 6.74

Net Interest Margin 3.31 1.86

Cost Income Ratio 60.68 51.91

. Cost of Deposits decreased from 6.29 per cent in 2011 to 5.71 per cent in 2011.

. The yield on advances and yield on investments both increased to 10.29 per cent and 7.14 per cent from 9.82 per cent and 6.74 per cent respectively in previous year.

. Net Interest Margin significantly increased from 1.86 (2010) to 3.31 per cent.

. Cost Income Ratio increased from 51.91 per cent in 2010 to 60.68 per cent, on account of increased establishment expenses

5. BANKING RATIOS

(In percentage)

2010-11 2009-10

Interest Income to Average Working Fund (AWF) 8.49 7.56

Non-Interest Income to AWF 0.71 1.09

Operating Profit to AWF 1.45 1.29

Return on Average Assets 0.70 0.66

Business Per Employee (Rs. in lakh) 835 712

Net Profit per Employee (Rs. in lakh) 3.96 3.30

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

31.03.2011 31.03.2010 Basel-I Basel-II Basel-I Basel-II

Risk Weighted Assets (Rs. in crore) 128587 116619 104344 92181 Capital Funds (in percentage)

Tier-I 5.81 6.31 6.03 6.83

Tier-II 4.93 5.33 4.78 5.40

Capital Adequacy Ratio 10.74 11.64 10.81 12.23

7. NET PROFIT & DIVIDEND

The Bank earned Net Profit of Rs. 1252 crore for the financial year 2010-11. The Board of Directors are pleased to recommend a dividend @ 25 per cent.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank:

. Shri Ramnath Pradeep has been appointed as CMD of Corporation Bank w.e.f. September 1, 2010.

. Shri Arun Kaul has been appointed as CMD of UCO Bank w.e.f. September 1, 2010.

. Smt. V.R. Iyer has been appointed as Executive Director with effect from September 1, 2010.

. Shri R.K. Dubey has been appointed as Executive Director with effect from September 1, 2010.

. Shri M.K. Bhattacharya ceased to be a Director with effect from July 30, 2010.

. Shri Salim Gangadharan has been appointed as RBI Nominee Director with effect from July 30, 2010.

. Shri M.S. Johar retired on January 1, 2011.

9. DIRECTORS RESPONSIBILITY STATEMENT

The Directors confirm that in the preparation of the annual accounts for the year ended March 31, 2011;

. The applicable accounting standards have been followed along with proper explanation relating to material departure, if any;

. The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

. Reasonable and prudent judgement 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 31,2011;

. Proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of the applicable laws governing banks in India ; and

. The accounts have been prepared on a going concern basis.

10. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

11. ACKNOWLEDGEMENT

The Board of Directors places on record its gratitude to the Government of India, Reserve Bank of India and the Security Exchange Board of India for their valuable guidance and support. The Board acknowledges with gratitude the unstinted support and faith of its customers and shareholders. The Board wishes to place on record its appreciation of the dedicated services and contribution made by members of staff for the overall performance of the Bank.

For and on behalf of the Board of Directors

Place: Mumbai S. Sridhar

Date : May 30, 2011 Chairman and Managing Director

Mar 31, 2010

The Directors have pleasure in presenting the Banks Annual Report along with the Audited Statement of Accounts, the Profit and Loss accounts and the Cash Flow statement for the year ended March 31,2010.

1. PERFORMANCE HIGHLIGHTS

- Total Business of the Bank increased by Rs.51213 crore to Rs.269225 crore, registering y-o-y growth of 23.5 per cent.

- Total Deposits increased by Rs.30835 crore to Rs.162107 crore, registering y-o-y growth of 23.48 per cent.

- Gross Advance of the Bank grew by Rs.20378 crore to Rs.107118 crore , registering y-o-y growth of 24 per cent.

- Operating Profit increased by Rs.621 crore to Rs.2058 crore, registering y-o-y growth of 43.21 per cent

- Net Profit increased by Rs.487 crore to Rs.1058 crore, registering y-o-y growth of 85.25 per cent.

- Capital Adequacy Ratio (as per Basel-II) reduced to 12.23 per cent from 13.12 per cent in previous year.

- Net Worth increased by Rs.1327 crore to Rs.5728 crore, registering y-o-y of 30.15 per cent.

- Gross NPA of the Bank increased by Rs.142 crore to Rs.2458 crore from Rs.2316 crore in previous year. In percentage term Gross NPA reduced to 2.29 per cent from 2.67 per cent in last year.

- Net NPA decreased from to Rs.727 crore from Rs.1063 crore in previous year. Net NPA percentage reduced to 0.69 per cent from 1.24 per cent in previous year (2009).

- Net Interest Margin (NIM) stood at 1.86 per cent against 1.97 per cent in 2009. This was due to fall in yield on investments which reduced from 6.89 (2009) to 6.74 per cent. The Average Earning Assets increased to Rs. 137085 crore from Rs.112578 crore in previous year.

- Business per Employee increased to Rs.712 lakh from Rs.560 lakh in last year.

- Net Profit per Employee increased to Rs.3.30 lakh from 1.71 lakh in 2009.

- Credit to Priority Sector increased to Rs.35393 crore from Rs. 29332 crore in previous year, recording y-o-y growth of 20.66 per cent.

- Agriculture Advance of the Bank grew by 29.92 per cent, contributing a share of 21.31 per cent in Net Bank Credit, which is well above the RBIs norms of 18 per cent.

- Bank has issued 2.33 lakh Kisan Credit Cards during the year with sanctioned limit of Rs.1639 crore.

- New product Central Kisan Gold Card launched and issued to 85113 farmers.

- 17245 Self Help Groups formed during the year out of which 15685 groups were credit linked to the tune of Rs.158 crore.

- The advances to MSE grew by 59.72 per cent from Rs.5833 crore in year 2009 to Rs.9317 crore. Under the cluster based approach, 60 SSI specialised branches have been re-designated to "SME Specialised Branches".

- 14047 villages have been brought under 100 per cent Financial Inclusion. During the year 34.08 lakh No-Frill accounts were opened.

- Retail loans of the Bank grew by 23.37 per cent from Rs.9070 crore (2009) to Rs.11190 crore. The share of Retail Loan in Gross Advance was 10.45 per cent.

- Education Loan grew by 44 per cent during the year and reached to Rs.1189 crore.

- Vehicle loan segment registered a robust growth of 50.16 per cent & portfolio reached to Rs.553.35 crore.

- Credit to Infrastructure Sector reached to Rs.24479 crore.

- Bank has opened 49 new branches during the year and have network of 3577 branches as on 31st March 2010.

- 1533 branches were brought under CBS platform.

- Retail sale of Cent Gold coins started during the year.

- Bank has earned trading profit of Rs.772.31 crore during the year.

2. INCOME & EXPENDITURE

Details of income and expenditure for the period 2009-10 are given hereunder:

Rs. in crore 31.03.2010 31.03.2009 Variation %

1 INTEREST INCOME 12064 10455 1609 15.29 Advances 8648 7753 895 11.54 Investments 3307 2563 744 29.02 Others 109 139 30 -21.58 2 OTHER INCOME 1735 1070 665 62.14 (Profit on Sale of Investments) 772 410 362 88.29 3 TOTAL INCOME (1+2) 13799 11525 2274 19.73 4 INTEREST EXPENDED 9519 8227 1292 15.70 Deposits 9121 7913 1208 15.26 Others 398 314 84 6.75 5 OPERATING EXPENSES 2222 1861 361 19.40 Establishment 1544 1272 272 21.38 others 678 589 89 15.11 6 OPERATING EXPENSES (4+5)11741 10088 1653 16.39 7 SPREAD (1-4) 2545 2228 317 14.22 8 OPERATING PROFIT (3-6) 2058 1437 621 43.21 9 PROVISIONS-NPA/ INVST./OTHERS 509 512 3 -0.59 10 PROVISIONS FOR TAXATION 491 354 137 38.70 11 NET PROFIT 1058 571 487 85.25

- Income from investments has recorded a growth of 29.02 per cent, whereas interest income from advances grew by 11.54 per cent. Interest Income for the year recorded growth of 15.29 per cent.

- Net Interest Income (spread) grew by 14.22 per cent while the interest expenditure increased by 15.70 per cent.

- Due to lower rate of interest in advances, Net Interest Margin reduced from 1.97 per cent in 2009 to 1.86 per cent and Yield on Advances from 10.19 per cent (2009) to 9.82 per cent.

- Operating profit has increased by 43.21 per cent, while Net Profit recorded a robust growth of 85.25 per cent for the year 2009-10.

3. PROVISIONS

Details of Total Provisions of Rs. 1000 crore charged to the Profit and Loss Account during the year 2009-10 vis-a vis previous year are detailed as under:

(Rs. in crore) 31.03.2010 31.03.2009 Variation

Provisions for Standard Assets 30 45 -15 Provisions for NPAs 288 322 -34 Depreciation/Provision on Investments 65 91 -26 Provisions for Taxes 491 354 137 Others 126 54 72 TOTAL 1000 866 134

4. SPREAD ANALYSIS

{In percentage) 31.03.2010 31.03.2009

Cost of Deposits 6.29 6.90 Cost of Funds 6.34 6.94 Yield on Advances 9.82 10.19 Yield on Investments 6.74 6.89 Net Interest Margin 1.86 1.97 Cost Income Ratio 51.91 56.44

- Cost of Deposits decreased from 6.90 per cent in 2009 to 6.29 per cent in 2010 and Cost of Funds also reduced to 6.34 per cent from 6.94 per cent in previous year.

- The yield on advances and yield on investments both decreased to 9.82 per cent and 6.74 per cent from 10.19 per cent and 6.89 per cent respectively in previous year.

- Net Interest Margin reduced from 1.97 per cent (2009) to 1.86 per cent.

- Cost Income Ratio reduced from 56.44 per cent in 2009 to 51.91 per cent.

5. BANKING RATIOS

(In percentage) 2009-10 2008-09

Interest Income to Average Working Fund (AWF) 7.56 8.22 Non-Interest Income to AWF 1.09 0.84 Operating Profit to AWF 1.29 1.13 Return on Average Assets 0.66 0.45 Business Per Employee (Rs. in lakh) 712 560 Net Profit per Employee (Rs. in lakh) 3.30 1.71

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

31.03.2010 31.03.2009

Basel-I Basel-ll Basel-I Basel-ll

Risk Weighted Assets (Rs. in crore) 104344 92181 79572 71270 Capital Funds (in percentage) Tier-I 6.03 6.83 6.24 6.97 Tier-ll 4.78 5.40 5.51 6.15 Capital Adequacy Ratio 10.81 12.23 11.75 13.12

7. NET PROFIT & DIVIDEND

The Bank earned Net Profit of Rs. 1058 crore for the financial year 2009-10. The Board of Directors are pleased to recommend a dividend 22 percent

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review, the following changes took place in the Board of Directors of the Bank:

- Shrl Arun Kaul has been appointed as Executive Director with effect from April 22,2009

- Shrl Romesh Sabharwal has been re-appointed as a Part-Time Non-Official Director with effect from October 6, 2009

- Major (Retd.)Ved Prakash has been re-appointed as a Part-Time Non-Official Director with effect from October 20, 2009.

- Shrl B S Rambabu has been appointed as Workmen Employee Director with effect from March 16,2010.

9. DIRECTORSRESPONSIBILTY STATEMENT

The Directors confirm that in the preparation of the annual accounts for the year ended March 31,2010:

- The applicable accounting standards have been followed alongwith proper explanation relating to material departure, if any;

- The accounting policies framed in accordance with the guidelines of the Reserve Bank of India were consistently applied;

- Reasonable and prudent judgement 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 the applicable laws governing banks in India; and

- The accounts have been prepared on a going concern basis.

10. CORPORATE GOVERNANCE

The Board of the Bank is committed to adapt Corporate Governance practices in letter and spirit. The Bank has adopted well documented system and practice on Corporate Governance.

11. ACKNOWLEDGEMENT

The Board of Directors places on record its gratitude to the Government of India, Reserve Bank of India and the Security Exchange Board of India for the their valuable guidance and support. The Board acknowledges with gratitude the unstinted support and faith of its customers and shareholders. The Board wishes to place on record its appreciation of the dedicated services and contribution made by members of staff for the overall performance of the Bank.

For and on behalf of the Board of Directors

Place: Mumbai S Sridhar Date : May 22,2010 Chairman and Managing Director

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