To
The Members
1. The Board of Directors has great pleasure in presenting the Annual Report along
with the Audited Financial Statement of Accounts and the Cash Flow Statement of the Bank
for the year ended March 31, 2018.
2. Performance Highlights i. Savings Bank Deposits of the Bank increased from
36,239 cr as on 31st March, 2017 to Rs. 36,471 cr as on 31st March, 2018 registering a
growth of 0.64%. ii. CASA Deposits of the Bank decreased from Rs. 43,222 cr as on 31st
March, 2017 to Rs. 42,485 cr as on 31st March, 2018 registering a reduction of 1.71%. CASA
as percentage of Total Deposit has increased from 37.93% as on 31st March, 2017 to 40.03%
as on 31st March, 2018. iii. Priority Sector Advances decreased from Rs. 36,992 crore as
on 31st March, 2017 to Rs. 35,949 crore as on 31st March, 2018, registering a negative
growth of 2.82%. Priority Sector Advances as of 31.03.2018 42.27% of Adjusted Net Bank
Credit (ANBC) surpassed the regulatory target of 40%. iv. Agricultural Advances increased
from Rs. 16,375 crore as on 31st March, 2017 to Rs. 18,179 crore as on 31st March, 2018,
registering a Y-o-Y growth of 11.02%. Agriculture Advances constituted 21.38% of Adjusted
Net Bank Credit (ANBC), surpassing the regulatory target of 18%. v. MSME advance under
priority sector decreased from Rs. 15,316 crore as on 31st March, 2017 to Rs. 11,638 crore
as on 31st March, 2018, registering a negative growth of 24.01%. vi. Total Retail advance
has registered Y-o-Y negative growth of 0.46 % and stood at the level of Rs. 13,240 crore
as on 31st March, 2018 as against Rs.13,301 crore as on 31st March, 2017. vii. Bank's
Operating profit for the FY 2017-18 has decreased by 15.76 % to Rs. 1,171 cr as compared
to Rs. 1,390 cr for the FY 2016-17. viii. Interest income on investments for the FY
2017-18 has decreased by 7.71% to Rs. 2682 cr as against Rs. 2,906 cr for the FY 2016-17.
ix. Capital to Risk (Weighted) Asset Ratio (CRAR) under Basel III has decreased and stood
at 11.09 % as on 31st March, 2018 as compared to 11.39% as on 31st March, 2017. x. Tier I
capital ratio of the Bank decreased from 9.05% as on 31st March 2017 to 8.81% as on 31st
March 2018. xi. Cash recovery in NPA accounts stood at 931.24 cr in FY 2017-18 compared to
Rs. 1,119.87 cr in FY 2016-17. xii. Recovery in Written-Off accounts increased from Rs.
115 cr for FY 2016-17 to Rs. 142 cr in FY 2017-18. xiii. Cost of Deposits reduced from
6.43% for FY 2016-17 to 5.62% for FY 2017-18 and as a result Interest Expenses on Deposits
reduced from Rs. 7,213 cr as on 31st March, 2017 to Rs. 5,955 cr as on 31st March, 2018.
xiv. Key Statistics
|
|
(Rs. In Crore) |
| Particulars |
As of 31st 2017 |
March 2018 |
| Deposits |
1,13,943 |
1,06,130 |
| Advances |
77,538 |
74,239 |
| Business Mix |
1,91,481 |
1,80,369 |
| Investments |
40,190 |
38,040 |
| Priority Sector |
36,992 |
35,949 |
| Agriculture |
16,375 |
18,179 |
| Particulars |
As of 31st March |
|
2017 |
2018 |
| Retail |
13,301 |
13,240 |
| MSME-PS |
15,316 |
11,638 |
| Gross NPA |
12,619 |
16,361 |
| Net NPA |
7,735 |
7,839 |
| % of Gross NPA to Gross |
16.27 |
22.04 |
| Advance |
|
|
| % of Net NPA to Net Advance |
10.66 |
11.95 |
3. Income Analysis
The financial performance of the Bank for the year 2017-18 is summarized below:
(Rs. In Crore)
| Particulars |
As of 31st March |
|
2017 |
2018 |
| Operating Profit |
1,390.21 |
1,171.16 |
| Interest Income |
10,181.67 |
8,932.23 |
| Interest Expenditure |
7,773.31 |
6,456.41 |
| Net Interest Income |
2,408.36 |
2,475.82 |
| Non-Interest Income |
1,251.39 |
1,163.52 |
| Provisions and contingencies |
2,253.84 |
3,094.31 |
| Profit before Tax |
[1,275.36] |
[3178.75] |
| Provision for Taxes |
[411.73] |
[1255.60] |
| Net Profit |
[863.63] |
[1923.15] |
4. Key Financial Indicators
|
(in %) |
| Particulars |
As of 31st March |
|
2017 |
2018 |
| Net Interest Margin |
2.00 |
2.19 |
| Return on Assets |
[0.67] |
[1.59] |
| Cost to Income Ratio |
62.01 |
67.82 |
| Provision Coverage Ratio |
50.56 |
60.20 |
| Cost of Deposit |
6.43 |
5.62 |
| Cost of Funds |
6.54 |
5.84 |
| Yield on Advance |
8.98 |
8.00 |
| Yield on Fund |
8.03 |
7.51 |
| Yield on Investments |
7.57 |
7.26 |
| Return on Equity |
[13.50] |
[26.17] |
| Earning Per Share (Rs.) |
[11.89] |
[18.06] |
| Book Value (Rs.) |
65.42 |
27.45 |
5. During the year 2017-18, Bank has not opened any new Branch, due to Prompt
Corrective Action (PCA) enforced on Bank by Reserve Bank of India. Further, Bank has
merged two Branches in other existing Branch and Branch network of the Bank stood at 1,872
(including 72 Satellite Offices). All the branches of the Bank are covered under CBS.
6. During the year 2017-18, Bank has established 3 new E-Smart centers taking the
total to 98. In E-Smart centers, customers can deposit cash, deposit cheques, withdraw
cash, get their passbooks printed and access their account through internet banking
facility on 24*7 basis.
7. During the year 2017-18, Bank installed 1775 POS and has launched a new mobile
banking channel i.e. Unified payment
Interface (UPI) promoted by NPCI.
8. Dividend
Board of Directors has not recommended any Dividend for the FY 2017-18.
9. Net Worth and CRAR
9.1 Net Worth of the Bank stood at Rs. 5108.04 cr as on 31st March, 2018.
9.2 CRAR :
|
|
(in %) |
|
Basel III |
|
|
March 2017 |
March 2018 |
| CRAR Tier- I Capital |
9.05 |
8.81 |
| CRAR Tier -II Capital |
2.34 |
2.28 |
| Total |
11.39 |
11.09 |
10. Changes in Board of Directors
10.1 The Board of Directors of the Bank, as on 31st March 2018, comprised two
Executive Directors, being whole-time Directors and six other directors as under:
• One Government of India Nominee Director,
• One Reserve Bank of India Nominee Director;
• Two Directors appointed by Govt. of India; and
• Two Shareholders' elected Directors;
10.2 Shri Ashwani Kumar, Chairman & Managing Director, ceased to be a Director
of the Bank w.e.f. 31.12.2017, after completion of his 5 years tenure in terms of
Notification No. F.No.4/4/2011-BO.I. dated 09th November, 2012 received from Government of
India, Ministry of Finance, Department of Financial Services. The Board of Directors
placed on record their appreciation for the exemplary leadership and direction provided by
Shri Ashwani Kumar, during his tenure as Chairman & Managing Director on the Board of
the Bank.
10.3 Smt Trishna Guha, Executive Director, retired from the Board on August
31, 2018, upon attaining superannuation. The Board of Directors placed on record their
appreciation for valuable contribution made by Smt Trishna Guha, during her tenure as
Executive Director on the Board of the Bank.
10.4 Dr. Rajesh Kumar Yaduvanshi has been appointed as Executive
Director in terms of Notification No. F.No.4/5/(6)2017-BO.I. dated
09th October, 2017 received from Government of India, Ministry of Finance, Department
of Financial Services w.e.f. 09th October, 2017 for a period of three years or until
further orders, whichever is earlier under Clause (a) of Sub-Section (3) of Section 9 of
the Banking Companies (Acquisition and Transfer of Undertakings)
Act, 1970/1980 read with sub-clause (1) of clause 3 and subclause (1) of clause 8 of
The Nationalized Banks (Management & Miscellaneous Provisions) Scheme, 1970.
10.5 Shri Bankim R Desai, Workmen Employee Director, appointed under Clause (e) of
Sub-section (3) of Section 9 of the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1970/1980 read with sub-clause (1) & (2) of clause 9 of The
Nationalized Banks (Management & Miscellaneous Provisions)
Scheme 1970/1980, w.e.f. 19.09.2014, ceased to be a Director of the Bank from
19.09.2017 on completion of his tenure. The Board of Directors placed on record their
appreciation for valuable guidance provided by Shri Bankim R Desai, during his tenure as
Director on the Board of the Bank.
10.6 Dr. Umesh Bellur, Shareholder Director, elected under clause (i) of
sub-section (3) of Section 9 of Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1970/1980, w.e.f. 24th March, 2015, ceased to be a Director of the Bank
upon completion of his tenure of three years on 23rd March, 2018. The Board of Directors
placed on record their appreciation for valuable guidance provided by Dr. Umesh Bellur,
during his tenure as Director on the Board of the Bank.
10.7 Shri V Chandrasekaran, Shareholder Director, elected under clause (i) of
sub-section (3) of Section 9 of Banking Companies
(A Acquisition and Transfer of Undertakings) Act, 1970/1980, w.e.f. 24th March, 2015,
ceased to be a Director of the Bank upon completion of his tenure of three years on 23rd
March, 2018. The
Board of Directors placed on record their appreciation for valuable guidance provided
by Shri V Chandrasekaran, during his tenure as Director on the Board of the Bank.
10.8 Dr. Yasho Verdhan Verma, Shareholder Director, elected under clause (i)
of sub-section (3) of Section 9 of Banking Companies
(A Acquisition and Transfer of Undertakings) Act, 1970/1980, w.e.f. 24th March, 2015,
ceased to be a Director of the Bank upon completion of his tenure of three years on 23rd
March, 2018. The Board of Directors placed on record their appreciation for valuable
guidance provided by Dr Yasho Verdhan Verma, during his tenure as Director on the Board of
the Bank.
10.9 During the Financial Year under review, in terms of Clause (i) of sub-section
(3) of Section 9 of the Banking Companies (Acquisition and Transfer of Undertakings) Act,
1970/1980, the Bank conducted an Extraordinary General Meeting of Shareholders of the Bank
other than the Central Government, for election of two Shareholder Directors at Sir
Sorabji Pochkhanawala Bankers' Training College, Mumbai on March 27, 2018. After the
successful exercise of election, two Shareholder Directors i.e. (i) Dr Yasho Verdhan Verma
and (ii) Shri Rakesh Kumar, were elected as Shareholder Directors representing
shareholders other than Central Government. These Directors have hold office for three
years w.e.f. March 28, 2018.
11. Directors' Responsibility Statement
.
The Directors, in preparation of the annual accounts for the year ended March 31, 2018,
confirm the following: i. That in the preparation of the annual accounts, the applicable
standards have been followed along with proper explanation relating to material
departures. ii. That they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent 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 or loss of the Bank during the period. iii. That they have taken
proper and sufficient care for the maintenance of adequate accounting records in
accordance with the provisions of applicable laws governing banks in India for preventing
and detecting frauds and other irregularities. iv. That they have prepared the annual
accounts on a going concern basis.
Acknowledgments
12.1 The Board of Directors expresses its patronage and sincere thanks to the
Bank's valued customers, shareholders and well-wishers for their valuable contribution
towards the progress of the Bank and seek their continued support and co-operation in
future. 12.2 The Board of Directors acknowledges with gratitude, the timely advice,
valuable guidance and support received from Government of India, Reserve Bank of India
& other regulators.
12.3 The Board of Directors is also thankful to the Financial Institutions / Banks
and Correspondents for their cooperation and support to the Bank.
12.4 The Board of Directors wish to place on record, the deep appreciation of
the valuable contribution made by the staff, at all levels, for the progress achieved in
Bank's business. The Directors look forward to their continued cooperation in faster
business development and progress of the Bank.
|
For and on behalf of Board of Directors |
| Place: Mumbai |
(Ramesh S. Singh) |
| Date: 31.05.2018 |
Executive Director |
|