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Bank of Maharashtra.

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Bank of Maharashtra. (MAHABANK) - Director Report

Company director report

Your Directors have pleasure in presenting the Annual Report of the Bank with theaudited Balance Sheet Profit & Loss Account and the Report on Business and Operationsfor the year ended March 31 2016.


1.1 Economic and Banking Scenario 2015-16:

Global output is estimated to have grown by 3.1 percent in 2015 with 1.9 percentgrowth for advanced economies and 4.0 percent growth for emerging market and developingeconomies. Global growth is also projected to remain modest in 2016 at 3.2 percent as perWorld Economic Outlook (WEO) April 2016.

In the Advance Estimates of GDP released by Central Statistics Office (CSO) the growthrate of GDP at constant market prices is projected to increase to 7.6 per cent in 2015-16from 7.2 per cent in 2014-15. Domestic economic activity lost pace in the second half of2015-16 slowed down by muted investment and a prolonged contraction in exports. Whileprivate final consumption expenditure has been the mainstay in holding up aggregatedemand it has largely been an urban phenomenon; coincident indicators of ruralconsumption generally remained weak or in negative territory.

Agriculture is likely to register low growth for the second year in a row on account ofweak monsoons; it has performed better than last year. Industry has shown significantimprovement primarily on account of the better manufacturing and service growth.

Consumer price inflation rose in the second half of 2015-16 before dropping in Februarywith a sharp decline in food prices. Farm and non-farm cost pressures abated and wagegrowth in rural areas as well as in the organised sector remained weak. Inflation howeverremained contained on account of (i) cereal inflation remaining contained by astute supplymanagement; (ii) softening of crude oil prices from December onwards and (iii) sharp fallin vegetable prices since December 2015.

1.2 Outlook for 2016-17

Global growth is expected to pick upto 3.5 percent in 2017. (WEO April 2016)

On the domestic front Real GDP growth is projected to improve gradually to 7.6 percent in 2016-17 with inflation expected to moderate to 5 per cent. However slow pick up ofinvestment demand private investment and significant risks of weaker global activity;could be the deterrents to the projected growth prospects. Positive sentiments howeveremerge from the government's "start-up" initiative strong commitment to fiscaltargets and the thrust on boosting infrastructure that could brighten the investmentclimate; while household consumption demand could be spurred by the Pay Commission awardcontinued low commodity prices and measures to announced for rural sector in the UnionBudget 2016-17.

2. Performance of Business & Deposits 2015-16

2.1 Business

Total Business of your Bank stood at ' 250103 crore as on 31.03.2016 as compared to '223329 crore last year (growth of 11.99%).

2.2 Deposits

Total deposit stood at ' 138990 crore as compared to '122119 last year (growth of13.81%). CASA deposit stood at ' 50967 crore against last year figure of '45297 crore(growth of 12.52%). Total CASA percentage stood at 36.68%.

2.3 Credit Deployment

Gross advances of the Bank increased from '101210 crore as on 31.03.2015 to '111240.28crore as on 31.03.2016 (growth of 9.91%) as a result of Bank's customer centric approach.

Establishing Central Processing Cells at all the 33 Zones is major initiative duringthe year. The centralized processing is expected to improve quality of appraisal andreduce undue delays in credit delivery mechanism. Proposal movement along with theirdisposal is continuously monitored using CPTMS (Credit Proposal Trail Maintenance System)and same is also used to reduce TAT (Turn-Around-Time).

Efforts are continued to improve loan portfolio yield by reshuffling the portfolio mixby increasing retail/SME & CC portfolio.

2.3.1 Sectoral Deployment of Credit

While financing to various segments of the economy the Bank has endeavored to maintaina diversified credit portfolio with a view to ensuring credit dispersion across sectors.The Bank has continued its efforts to support core manufacturing and priority sectors aswell as infrastructure projects which serve to drive economic growth. This focus of theBank will continue in future in line with the national economic growth priorities.

Industry wise credit deployment as on 31.03.2016 is as under:

Percentage to total No. O/s O/s as on 31.03.2016 Percentage to total O/s O/s as on 31.03.2015 Percentage to total O/s
1 Industry 60953.31 54.79 57019.12 56.34
Of which
i. Infrastructure 13055.62 11.74 13656.17 13.49
ii. Chemicals Dyes Paints etc 3202.56 2.88 1461.41 1.44
iii. Petroleum 2199.72 1.98 3569.25 3.53
iv. Iron and Steel 2870.77 2.58 2979.69 2.94
v. NBFCs and Trading 22180.52 19.94 18386.76 18.17
vi. Engineering 3649.50 3.28 3164.07 3.13
vii. Construction 3.49 0.00 428.95 0.42
viii. Other Industries 13791.13 12.40 13372.82 13.21
2 Agriculture 14851.67 13.35 12079.59 11.94
3 MSME 22143.75 19.91 20653.03 20.41
4 Housing 10550.01 9.48 9868.33 9.75
5 Education 804.06 0.72 702.79 0.69
6 Exports 1226.51 1.10 1301.40 0.00
7 Commercial Real estate 5811.72 5.22 5750.35 5.68
Gross Advances 111240.28 101210.27

2.3.2 Credit Administration and Monitoring

Early warning signals are captured from the CBS system on daily basis for closemonitoring of stressed accounts on near real time basis. System generated SMS alerts aresent to the customers to pre-empt delinquency. An integrated web-based reporting has beenintroduced in the Bank to enable instant communication between branches / Zones /HeadOffice for effective monitoring of credit portfolio.

The credit quality of borrowal accounts is further monitored through periodical assetperformance review credit audits and stock audits. Timely rescheduling of repayment termsis undertaken in deserving cases.

2.4 Asset Performance

During the Financial Year (FY) 2015-16 total cash recovery in NPAs was ' 772.82crore (last year ' 619.70 crore). Of this recovery in Ledger balance was ' 645.45crore (' 430.13 crore) including recovery in sale of assets of ' 48.48crore (' 63.67 crore) recovery in written off accounts was '72.83 crore (Rs113.69 crore) and recovery in cases of unapplied interest was '54.54 crore (Rs75.88 crore). This was besides upgradation of NPAs to the tune of ' 191.30 crore('397.63 crore).

This achievement was result of intensive follow up with the defaulting borrowersthrough letters notices visits Recovery Camps Lok Adalatas appointing ResolutionsAgents and Recovery Agents actions under SARFAESI Act and through DRTs. Bank has also setup Asset Recovery Cells at Zonal offices for focused efforts for upgradation and NPArecovery at field level.

The Gross NPA ratio of the bank is at 9.34 % as against 6.33 % as of 31.03.2015due to rise in fresh slippages. Similarly the ratio of Net NPAs stood at 6.35% ason 31.03.2016 as against 4.19% a year ago as provision could not keep up pace withslippages.

2.5 Foreign Exchange Business and Export Finance

During the year 2015-16 the Bank achieved merchant turnover of ' 29562 cr (previousyear ' 27925 cr) and interbank turnover of ' 565671 crore (previous year ' 546969 cr) andearned exchange profit of ' 78.55 cr (previous year ' 75.55 cr)

The outstanding export credit as on 31st March 2016 was '1226.62 cr asagainst ' 1301.40 cr as on 31st March 2015.

The Treasury and International Banking Branch at Mumbai (A Category Branch) and 35 BCategory branches across the country cater to the international business needs of thecustomers of the Bank. In order to provide prompt service to Non Resident Indian ClientsBank has a NRI Cell at Deccan Gymkhana Branch Pune. With a view to enable branches toprovide better service to NRI clients Bank has provided instant NRI information which isupdated regularly.

NRI Cell

A separate NRI Cell has been formed under Planning Dept since Sept 2014 to providesupport to branches and to concentrate in increasing NRI business. NR deposits have grownfrom ' 1153.29 crore as on 31.03.2015 to '1617.87 crore as on 31.03.2016 (growth of40.28%).

2.6 Investments

The net investments of the Bank stood at ' 36230.87 as on 31.3.2016 as comparedto ' 32765.00 crore as on 31.03.2015. Investments under Held to Maturity (HTM) categoryconsist of 78.74% while Available for Sale (AFS) comprised 21.26% of total investmentportfolio as on 31.03.2016. The net interest income from investment activity increased to' 2735.20 crore from ' 2539.53 crore during the last year (growth of 7.70%).

2.7 Borrowings:

The borrowing of the Bank as on 31st March 2016 stood at ' 9228.10 croresincluding re-finance from Exim Bank to the extent of ' 331.27 crores. The total borrowingas on the previous year 31.3.2015 stood at ' 11126.72 crores.

2.8 Merchant Banking:

The Bank handled 126 issues (previous year 90 issues) of Commercial Paper amounting to' 54060 crores (previous year ' 25175 crore) for its clients as an Issuing and PayingAgent (IPA) during the year.

New Initiative:

In addition to GRAS (Govt. Receipts Accounting System- e-payment of taxes) through allthe Branches in the state of Maharashtra the Bank has introduced e-SBTR (electronicSecured Bank & Treasury Receipts).

• To provide Facility for On-line/Over the Counter payment of Stamp duties/Registration fees and issue of Simple Receipt/e-SBTR through our Bank for the InspectorGeneral of Registration & Controller of Stamps Pune Maharashtra.

• Presently this facility is available in the state of Maharashtra across 301branches.

2.9 Depository Services

• Bank is Depository Participant (DP) of Central Depository Services of India Ltd.(CDSL) since September 1999.

• The Bank has also introduced Basic Services Demat Account Facility (BSDA)

2.10 Bancassurance

• Insurance for all the securities charged to the Bank may be done invariablyunder Bancassurance arrangement with UII Co. Ltd.

• 1504 branches are logged in as of 31.03.2016 for LIC Bancassurance business.

• We had created portal for Popularization of Mahaswastya Yojana All new as wellas renewal of cases are done through the portal in T+3 days. Now the customer havinginternet banking facility can make the payment online and generate the policyinstantaneous.

• This year till 31.03.2016 13 Zones declared as BIMA Zones.

• During the year 2015-16 13242 life policies and 89784 Non-Life policies weremade.

• The Bank earned a commission of ' 6.83 crore from life insurance and ' 4.60crore for non-life insurance business during the year 2015-16.

2.11 Government Business

• During the year 2015-16 669450 challans of Direct Taxes and 173324 challans ofIndirect taxes were collected by the branches. Our Branches are also collecting otherstate Govt. taxes including GRAS of Maharashtra State and the total number of Challanscollected during the Year is 1171589. Total commission to the tune of ' 9.21 Cr wasreceived on Tax collection business from Central Government.

• The Bank is processing and crediting monthly pension payments of more than114320 Central Government Defence Railway and Telecom pensioners at Central PensionProcessing Cell (CPPC) Pune. The commission on Government Business (Pension) for the Year2014-15 is ' 13.05 Cr.

• A unique facility of direct and Indirect taxes and VAT collection of Maharashtrais provided by the Bank at the branch counter in all branches through Maha e-sevaservices. E-payment of Taxes facility available for net banking customers is alsoavailable for direct / Indirect Taxes / VAT payments (for Govt. of Maharashtra).

• Presently Bank is having tax collection arrangement with 9 state 2 states i.e.Rajasthan & Chhattisgarh are in pipeline Bank is in process of technical integrationwith other state Governments.

• Bank has already started tax collection Business in Madhya Pradesh State.

2.12 Non Interest Income

2.13 Income Expenditure and Profitability

The total income of the Bank grew from ' 13671.42 crore in FY 2014-15 to '14072.29crore in FY 2015-16 (growth of 2.93%)

The detailed income/expenditure components are asunder:

(Rs. in crore)

Particulars 2015-16 2014-15 Variation (per cent)
Interest / discount on advances / bills 9934.83 9820.78 1.16
Income on investments 2735.20 2539.53 7.71
Interest on interbank lending and other Interest 382.95 305.13 25.5
Total interest income 13052.98 12665.44 3.06
Non-interest income 1019.29 1005.98 1.32
Total Income 14072.27 13671.42 2.93
Interest on deposits 8421.88 8084.74 4.17
Interest on borrowings 54.88 79.92 -31.33
Other interest expenditure 697.52 625.74 11.47
Staff expenses 1540.98 1633.21 -5.65
Other operating expenses 1011.83 892.72 13.34
Total Non-interest expenses 2552.81 2525.93 1.06
Total Operating Expenses 11727.09 11316.33 3.63
Operating Profit 2345.18 2355.09 -0.42
Provisions and Contingencies 2244.49 1904.40 17.86
Net Profit 100.69 450.69 -77.66

2.14 Financial Ratios

Particulars 2015-16 2014-15
EPS (') 0.91 4.50
Cost to Income Ratio (percent) 52.12 51.75
Return on assets (percent) 0.07 0.33
Return on equity (per cent) 1.24 6.68
Book value per share (') 63.36 65.61
Profit per Branch (' in lakh) 5.31 23.97
Profit per employee (' in lakh) 0.73 3.18
Business per Branch (Rs. in crore) 132.05 118.79
Business per employee (Rs. in crore) 18.18 15.74
Interest income as per cent to Average working funds 8.71 9.21
Non Interest income as per cent to average working funds 0.68 0.73
Net Interest Margin (per cent) 2.59 2.82
Operating Profit as per cent to average working Funds 1.56 1.71
Staff expenses as a percent to average working funds 1.03 1.19
Dividend (per cent) 0 8.00
Net worth (' Crore) 7403.05 6975.77
CRAR (%) (Basel II) 11.20 11.94
Of which Tier I CRAR (%) (Basel II) 9.02 8.76

2.15 Capital from Government of India

The Bank issued 105150787 equity shares amounting to ' 394.00 crore (including sharepremium) to GoI on preferential allotment basis.

Consequent upon the capital raised during the year as above the share holding of GOIin equity share capital stood at 81.61%

2.16 Networth

The Bank's Net worth increased from '6975.77 crore as on 31.03.2015 to '7403.05 croreas on 31.03.2016.

2.17 Capital Adequacy Ratio

The Capital Adequacy ratio stood at 11.20% as on 31.03.2016 against the minimum of9.63 %(Including CCB) prescribed by RBI in terms of Basel III norms. The Common EquityTier 1 Ratio stood at 9.02%.

2.18 Dividend

The Board of Directors of the Bank has not recommended any dividend for the Financialyear 2015-16.

3 .1 Branch Expansion

During the year the Bank opened 15 new branches. As on 31.03.2016 the total branchnetwork comprised of 1895 branches spread over 30 states and 4 union territories. Thebranch network includes specialized branches in the area of foreign exchange Governmentbusiness Treasury and International Banking Industrial Finance Small Scale Industry andHi-tech agriculture Pension Payment Self Help Groups etc.

Area wise classification of branches as on 31.03.2016 is given in the table below:

Classification As on 31.03.2015 As on 31.03.2016
Rural 657 658
Semi-Urban 433 434
Urban 364 366
Metro 426 437
1880 # 1895

# 36 Branches like Service /Retail Asset/Recovery Br's are converted as a "BackOffice" as per RBI Guidelines on 01.06.2014.

3.2 Human Resources Management

The Bank has put in place a comprehensive HRM Policy that provides the road map foracquiring appropriate & need based human resources its development through trainingjob enrichment reward and recognition for better performance career progression welfareand retention.

During the year the Bank recruited 351 Probationary Officers 113 Agril. FieldOfficers 10 Rajbhasha Adhikari 14 Law Officers 1 Company Secretary & 34 CharteredAccountants in Officer Cadre and 61 Clerks & 36 Armed Guards were also recruited.

During the year 1044 employees ceased to be in service on account of retirement VRSresignation termination and death.

Inter scale promotions of officers were carried out during 201516. Following number ofcandidates were promoted.

196 485 166 39 20 4

During the year 2015-16 106 Substaff were promoted to Clerical cadre and 300 Clerkswere promoted to Officer Cadre.

To recognize outstanding performance in Banking activities and to motivate others toperform better various schemes like Performance Linked incentives to all staff of BestPerforming Branches etc. are in vogue.

The top three branches in disbursement and recovery of advances to SC/ST community wereawarded Rolling Trophy in name of Bharat Ratna Dr. Babasaheb Ambedkar.

The Bank has been allocating up to 3 per cent of its net profit towards various schemesfor the welfare of staff including retired staff. The welfare schemes are administered bya Central Welfare Committee consisting of management & employees representatives.

The Bank has healthy industrial relations.

The Bank has been complying with the reservation policy of Govt. of India. SpecialCells at Head Office and all Zonal Offices are functioning to monitor the implementationof the reservation policies and to redress grievances of SC/ST/OBC & Physicallychallenged employees as well as ex-servicemen. The Bank has designated Chief LiaisonOfficers at Head Office and has set up SC/ST Cells at all Zonal Offices. During the yearperiodical meetings were held with SC/ST/OBC Employees Association to discussimplementation of reservation policy and other constitutional safe guards and also tofacilitate involvement in business growth.

The number of employees belonging to different categories is as under:

Category of Employees No. of Employees Percentage to total
1. Women 3739 27.16
2. Physically Challenged 184 1.34
3. SC Employees 2563 18.62
4. ST Employees 1082 7.86
5. OBC Employees 2116 15.37
6. General Employees 8004 58.15
TOTAL employees working in the Bank 13765

Rosters have been maintained as per Government guidelines and are regularly inspected/checked.

Compassionate Appointments - A Scheme for ‘Compassionate Appointments'/Payment of Ex-gratia lumpsum amount" to /of heirs of employees dying in harness orretiring due to incapacitation framed as per the directives of Government of India hasbeen implemented.

The Contributory Group Insurance Mediclaim Policy for all employees includingretired employees has been renewed w.e.f. 1.4.2016 and the Sum insured is increased upto'10.00 Lacs for existing employees.

The reimbursement of examination fees & payment of cash incentive /Honorarium in respect of courses from Indian Institute of Banking & Finance MBA fromreputed Institutions & CFA has been widened by adding five more courses in the list ofcourses for reimbursement of fees thereby making total 22 courses eligible forreimbursement of examination fees.

A policy for granting special leave and 100% reimbursement of hospitalizationexpenses to officers when he meets with an accident / injury while on duty isin place.

Policy for ‘granting incentives to officers posted & transferred in Northeastern zones from other zones' framed as per the directives of Government of India.

Training Activities:

The Bank has a training system which facilitates attention to regular periodicassessment of skill gaps at various levels in relation to existing and emerging businessopportunities. Skill building in credit Forex customer relationship managementmarketing of products and services credit monitoring and recovery risk managementtechnology based banking branch management complying with statutory legal and policyrequirements and preventive vigilance received special attention during the year.

Training programmes were also held on thrust areas like financing SMEs retail lendingagriculture finance soft skills and rural development.

Cadre-wise Break up of Employees trained during the period 1.4.2015 to 31.03.2016 areas undeer-

Cadre No. of Prog Training Days Employees Trained
Officers 129 547 4030
Clerks 64 208 1248
S/staff 37 74 692
Total 230 829 5970

3.3 Technology Initiatives

The Year 2014-2015 was a milestone year for the Bank as far as technologyimplementation & up-scaling was concerned. The Year 2015-2016 is being observed as"Stabilization Year"/"Technology Augmentation Year" for the variousinitiatives undertaken during the Year 2014-2015 in addition to new initiatives that havebeen taken up for implementation during the Year 2015-2016 and enumerated as under:

1. CBS Hardware Augmentation Project covering DC & DR was undertaken &successfully completed during the year to take care of increasing transactions load and toensure smooth functioning of CBS system at field level.

2. E-Gadgets implemented in a big way during the year with commissioning of Self UpdatePass Book Printers Queue Management Solution & Bunch Note Acceptor Machines atvarious locations across the Bank. The same will be continued during next financial yearto ensure fulfillment of customer requirements/satisfaction.

3. Latest ISO 27001:2013 Certification secured by the Bank for its four IT Divisionsthereby continuing the Quality ISMS (Information Security Management System) in our Bank.

4. ‘Maha Mobile' New Gen Mobile Banking Application which was launched in January2015 got stabilized during the year and was well received by our customers. As on31/03/2016 112210 users are registered for this facility.

5. ‘Mahasecure' a Two Factor Authentication (2FA) Solution for Retail Users &active Corporate Users has been implemented as a part of the effort to respond to the everevolving information security trends and the responsibility to enhance security featuresin the Internet Banking facility. One Time Password (OTP) for Fund Transfer is alsoimplemented under Mahasecure Application. No phishing attacks have been reported after theimplementation of this product.

6. IMPS-P2A (Immediate Payment System - Person to Account) & IMPS-P2P (ImmediatePayment System - Person to Person) Fund Transfer facility made available under InternetBanking from 12/06/2015 & 23/12/2015 respectively. Using this facility customers cando inter bank as well as intra-bank (24 x 7) fund transfer upto '5000/- in a day.

Bank's Own EFT Switch which was implemented Live from 08/05/2014 got fully stabilizedduring the year. As a result of the implementation of own EFT Switch Bank is derivingsignificant advantages like reduced turn-aroundtime to introduce new ATM Product Bettercustomer experience Reduced risk Instant Hot-listing of a card through multiplechannels Value Added Services etc.

Bank has collaborated with VISA for International Debit Cards and with NPCI for RupayDebit Cards. Bank has commenced issue of Rupay Platinum Cards from 28/03/2016. As on31/03/2016 the total card base of the Bank stood at 57.19 Lakhs.

Various facilities are being provided through our Internet Banking platform forfacilitating online payment of taxes utility bill payments online shopping / e-commercerailway reservation LIC premium payment e-SBTR etc and facility for viewing tax creditstatement 26AS and Demat account with the Bank.

Bank has robust Information Security Management System (ISMS) framework in place. Itsinformation security policy statement being: "Bank of Maharashtra is committed toprotect and safeguard the critical information of all stakeholders in order to ensuresecure business operations’’. Bank has also implemented major securityinitiatives recommended by Gopalakrishna Committee for internal and external customers.

Bank has in place a captive Security Operations Centre (SOC) for monitoring Critical ITInfrastructure on 24 x 7 basis. The SOC shall enable the Bank to effectively addresssecurity threats by constant proactive monitoring of security events and meet thecompliance requirements. This has enabled the Bank to automate the vulnerability discoveryprocess by constantly analyzing the logs generated by the core IT security and applicationinfrastructure. The other services namely AntiPhishing & Anti-Trojan services are alsoimplemented.

Bank is handling the e-Payments of State Government Taxes of Maharashtra KarnatakaTamil Nadu Madhya Pradesh & Rajasthan States.

Inward Clearing in Mumbai Pune & Ahmedabad Centers is already outsourced. Now wehave started Outsourcing of Outward Clearing in Nagpur. On stabilization it shall beextended further to Pune & Mumbai Centers so as to move towards the goal ofCentralized Clearing in future.

Bank has implemented Scientific Transfer Pricing Mechanism / Fund Transfer Pricingduring the year.

In Year 2016-2017 Bank proposes to take up / implement the following IT Initiatives -

1. Risk Based Internal Audit Software.

2. e-TDS Software.

3. Unified Payments Interface (UPI) of NPCI.

4. Bharat Bill Payment System (BBPS) of NPCI.

5. Risk Based Supervision (RBS)

6. International Financial Reporting Standards (IFRS).

7. Rupay Platinum Cards.

3.4 Customer Centric Initiatives taken by the Bank

The Bank has pursued high standards of customer service to ensure customer satisfactionthroughout the year by implementing all major recommendations of Goiporia Committee Dr.S.S. Tarapore Committee and Damodaran Committee.

As a member of Banking Codes and Standards Board of India (BCSBI) Bank has adoptedCode of Bank's Commitment to Customer and Bank's Code of Commitment to MSMEs.

Bank has printed folder called as "My Folder" containing all customer servicepolicies information on service charges guidelines on Government Schematic LoansOmbudsman and BCSBI Codes. The same is printed in Marathi Hindi and English and suppliedto all branches and Zones for making the same available to all customers on demand.

Duly documented policies approved by the Board on "Deposits""Collection of Cheques" "Redressal of Grievances""Compensation" "Operational Procedure for Settlement of Claims ofDeceased Depositors" and Customer Rights Policy are in place.

Customer Service Committees are formed at all branches and their meetings are conductedregularly on monthly basis. The Standing Committee on Customer Service at Head Office andZonal Level Customer Service Committees at Zones meet regularly to address and reviewvarious customer related matters and to take steps for an improvement on an ongoingbasis.

The Committee of the Board on Customer Service meets on quarterly basis to monitor thequality of the customer service redressal of customer grievances and to ensure customerssatisfaction.

Full-fledged grievances redressal machinery is in place to respond promptly to customergrievances. The Bank has started internet based mechanism Standardized PublicGrievances Redressal System (SPGRS) for lodging the complaints or to give suggestions/ feedback on services by the customers and for providing acknowledgement and status oftheir feedback / complaints as per the directions of Government of India.

Kiosk Machine has been installed at Head Office to enable the customer to registeronline complaints / suggestions and is in operation since 14.03.2013.

3.5 KYC/ AML

Know Your Customer (KYC) norms / Anti Money Laundering (AML) standards / Combating ofFinancing of Terrorism (CFT) and Obligation of Bank under Prevention of Money LaunderingAct (PMLA) 2002.

The Bank has Board approved KYC-AML-CFT Policy in place. The said Policy is thefoundation on which the Banks implementation of KYC norms AML standards and CFT measuresis based. The full KYC compliance entails staff education as well as customer educationfor which the following measures are taken by the Bank.

A comprehensive list of KYC documents is uploaded on the Banks web site for the benefitof customers. Regular training sessions are conducted on KYC-AML-CFT guidelines at theBanks training establishments to sensitize the employees.

3.6 Risk Management

Bank has its Risk Management Framework in accordance with RBI Guidelines and itbenchmarks itself against industry best practices. This enables it to identify measuremonitor and manage risk efficiently.

It has put in place Risk Management Policies and Strategies and establishes controlsystems in line with Bank's aggregate Risk Appetite. Bank has constituted Risk ManagementCommittee at Board level to monitor risk at Bank level. Bank has also constitutedsub-committees known as Credit Risk Management Committee (CRMC) Market Risk ManagementCommittee (MRMC) Operational Risk Management Committee (ORMC) and Asset LiabilityManagement Committee (ALCO) to monitor specific risk areas. These Committees are headed byChairman and Managing Director. Executive Directors and General Managers are members ofthe Committees.

As per RBI guidelines on disclosure requirements under Basel III Capital RegulationsBank has published Disclosures on quarterly and half yearly basis and put them on theBank's website.

3.7 Inspection & Audit:

The Inspection and Audit system and various measures of internal control are adopted bythe Bank to ensure identification /assessment and mitigations of various risks.

Internal Audit of branches

As per Seth Committee guidelines the Bank is conducting Risk Based Internal Audit ofbranches. RBIA of 1139 Branches which were due for Audit during the year including Top 142Branches in terms of Business were conducted.

The Bank has implemented Off-site monitoring system since 2015 to strengthen theinternal control system in which reports on some important/ sensitive areas are extractedfrom the CBS system on daily/weekly/monthly basis so as to guide the branches to taketimely action for rectification.

The Bank proposes to procure and implement web based integrated audit software forconducting various types of audits.

Surprise/Snap Inspection:-

Surprise/Snap Inspection of 12 branches were undertaken during the year focusingmainly on high risk areas in pursuance of Ghosh Committee Recommendations.

Concurrent Audit:-

As per approved Audit Plan for 2015-2016 498 branches and two departments of the Bankare covered under Concurrent Audit. Bank's 75.78% total business is covered underconcurrent Audit.

Income and Expenditure Audit (I.and E. Audit)

Income & Expenditure audit was carried out at 263 branches as per approved plan forthe period 01.10.2014 to 30.09.2015 having total business above ' 25.00 crore and advancesabove '5.00 crore.

Expenses Audit of Zonal Office : -

In order to have control over expenditure at Zonal offices a system has been put inplace through half yearly Expenses Audit. The Audit is conducted once in half year i.e.March and September. The expenses audit of 33 Zones was conducted as of 30.09.15.

Management audit:

For assessing the effectiveness of Zonal Offices and HO Departments in terms ofsupervision control profitability and growth in business Management Audit of 22 Zonaloffices and 17 Departments at Head Office is carried out during the year 2015-16.

RBI Inspection under Section 35 of the Banking regulation Act:-

The Bank is subject to RBI inspection under Sec.35 of the Banking Regulation Act duringthe year. Besides that 1 branch was also inspected by RBI during the year.


IBA has advised the Banks to implement 88 parameters so far for generation of AMLalerts. Bank has implemented 43 parameters out of 49 parameters as per IBA guidelines andthe remaining 6 parameters are related to 3rd party products. Inaddition to these the FEX centers/branches have been sensitized on the guidelines on TradeBased Money Laundering issued by FIU-IND to prevent fraud/money laundering.

3.8 Vigilance:

As per Central Vigilance Commission (CVC) guidelines the Bank has adopted IntegrityPact & appointed Independent External Monitors (IEMs) for independent review ofcompliance of obligations by the parties under Integrity Pact. This system will ensuretransparency equity & competitiveness in large value procurements.

To enlighten the participants on preventive vigilance aspects a session on preventivevigilance is included in every training programme. During the accounting year 88 sessionson preventive vigilance were conducted by vigilance department where in 2325 employeesfrom different cadres participated.

As a part of preventive vigilance exercise Zones are undertaking vigilance inspectionof Branches which has helped in detecting the fraud.

3.9 Compliance:

The Bank has put in place a Compliance Policy based on the guidelines of Reserve Bankof India. The Compliance Department is having a Chief Compliance Officer who monitors thecompliance functions. It ensures the implementation of the statutory / regulatoryguidelines coming into force from time to time. The issues relating to regulatory /statutory compliances are addressed appropriately. Submission of various regulatoryreturns is also monitored.

3.10 Marketing & Publicity:

With a view to publicize Bank's various products and also brand image coupled withCorporate Social Responsibilities Bank has sponsored various programs like"sponsorship to Sharda Shakti Pune for organizing Seminar on "Women HealthChallenges and Solution" in Pune Sponsorship to Nasik Kumbh Mela Sponsorship toTERRE Policy centre for organizing Green Olympiad Sponsorship to 14th Pune InternationalFilm Festival Donations to National Sports Development Fund (NSDF) Old Age Home Chennaiduring Chennai Flood Rotary Club Nigdi for the construction of water Tank in NigadeVillage Balewadi Stadium for providing "7 Water Coolers "ShrutakevaliEducation Trust" for Bahubali Children's Hospital Shravanabelagola KarnatakaDonation to Prakrit Bharati Academy Publishing 10 books on Indian Culture Religions.

3.11 Citizen’s Charter:

The Bank has adopted the Charter since 2000-01 which details the duties andresponsibilities of the Bank towards its customers. The charter is displayed at all thebranches and Bank's website. The Bank has also adopted a citizen's charter of RBI onexchange of notes and coins.


4.1 Priority Sector Lending

It has been the constant endeavor of the Bank to facilitate equitable and sustainableeconomic development by timely and hassle-free availability of credit for productivepurposes to Small and Marginal Farmers Micro and Small Enterprises Retail TradersProfessional and Self Employed Women Entrepreneurs and entrepreneurs from economicallyweaker sections.

The outstanding advances under Priority Sector as of 31st March 2016aggregates to ' 41485 Crore constituting 39.82% of the Adjusted Net Bank Credit (ANBC).(Growth of ' 2391 Crore 6.12% over last year).

4.2 Agriculture

The Bank disbursed '8179 Crore for agriculture and allied activities during the year2015-16. The total outstanding advances to agriculture sector reached a level of '17174Crore as on 31.03.2016 (growth of 10.65 per cent). Bank focused on growth of investmentcredit under Agriculture during the year 2015-16 and disbursed '1648 Crore. Bank alsoentered into strategic tie-up arrangements with Tractor Manufacturers and Micro IrrigationCompanies for promoting farm mechanization and micro irrigation activities during theyear. Tie up arrangement is also made with three Collateral Manager to capturemarket for expanding loan against ware house receipts.

The Bank undertook awareness/sensitization programmes for all the branches forincreasing advances to agriculture by providing hassle free credit to farmers.

4.2.1 Mahabank Kisan Credit Card (MKCC)

This scheme has gained popularity especially in rural areas where it is beingpropagated successfully and vigorously. The Bank has issued total 572221 Kisan CreditCards to farmers. Credit flow to MKCC beneficiaries has reached to the level of 6691 Croreas on 31.03.2016 (growth of 19.70 %).

4.3 Micro Small and Medium Enterprises (MSME)

SMEs are recognized as a major growth engine for the Indian economy. They generateopportunities for direct and indirect employment by facilitating use of natural resourcesand local skills to stem the tide of migration to urban areas and promote low investmententerprises. Finance is made available to viable enterprises at an attractive and low rateof interest. On line enquiry portal is made available on the Bank's website.

Our Bank has adopted Simplified Loan Application for MSMEs for loans up to ' 1.00 Croreand the same is displayed on the Bank's website. The Bank has also adopted Bank's Code ofCommitment to Micro and Small Enterprise and the same is displayed on the Bank's website.

The Bank's lending to Micro Small and Medium Enterprises (Priority + NP) which was atthe level of '20657 Crore as at 31.03.2015 increased to '22334 Crore as at 31.03.2016.Advances to Micro enterprises under priority are 7.79 % of ANBC against RBI target of 7.00% for March 2016.

For promoting finance under this category Bank has entered into strategic tie uparrangements with Truck / Vehicle / Tractor / Passenger car manufacturers. Bank has alsoentered into a MOU with Bharatiya Yuva Shakti Trust and de-Asra foundation for Creditfacilitation and hand holding of the Micro entrepreneurs especially under Women and SC/STcategories.

Centralized Processing Cell set up last year at all Zonal Offices for speedy disposalof MSME proposals has been streamlined.

Bank has launched a new product namely "Mahabank MSME Credit +" for financingto MSME borrowers during the FY 201516 in addition to five products introduced last year.

4.3.1 MUDRA: With the introduction of Pradhan Mantri MUDRA Yojana (PMMY) whichmainly consists of non-farm enterprises in manufacturing trading and services whosecredit needs are below ' 10.00 lakh. Bank is giving special attention to this segment.Loans given to this segment for income generation are known as MUDRA loans underPradhan Mantri MUDRA Yojana (PMMY) and branded accordingly.

Bank has disbursed '1290.00 Crore under PMMY against the target of '1155.00 Crore as on31.03.2016. Bank achieved 111.69% of target allotted by Government under PMMY.

Bank has launched MUDRA Card on 16.9.2015. MUDRA Card issued as a Rupay Debit Cardwhich is hassle free flexible credit product that meets working capital needs of Micro& Small Entrepreneurs and cash can be withdrawn from any ATM or purchase fromMerchandise using POS machine.

Bank has issued 7537 MUDRA Cards as on 31.3.2016

4.3.2 Coverage under CGTMSE Scheme

Under Credit Guarantee Fund Scheme for Micro Small and Medium Enterprises ofGovernment of India credit facilities up to '100.00 lakh are covered wherein nocollateral security and third party guarantee are insisted by the Bank. For the accountscovered under this scheme Bank is bearing 50% annual guarantee fee for loans above '10.00lakh and annual guarantee fee for loans below '10.00 lakh is borne by borrower. The Bankhas sanctioned loans of '2005.54 Crore to 21287 borrowers under this scheme up to March2016. During the current FY coverage under Credit Guarantee Fund Scheme has increased by11.10%.


5.1. Credit Flow to Retail Sector

The Bank is providing retail loans for salaried persons professionals businessmen andpensioners for purchase of housing properties/ plots repair/ renovation of housepurchase of consumer durables two/four wheeler vehicles education and loan for otherpersonal needs etc. The retail loan portfolio of the bank is '12567.96 Crore.

5.2. Mahabank Gold Loan Scheme

Gold ornaments are the traditional and inherited form of savings among the people inIndia. Being one of the most liquid and precious asset it serves as a dependable andacceptable form of security to raise loans for meeting immediate financial needs forbusiness agricultural consumption purposes such as marriage medical educationalexpenses etc. People borrow money by pledging Gold Ornaments at very high rate ofinterest. To tap the potential of gold loans as a lucrative asset and to meet the creditrequirement of our customers. With a view to meet the credit requirement of our customersBank has launched a new retail loan product "Mahabank Gold Loan Scheme" w.e.f.26.09.2014. The total portfolio of Gold Loan of our Bank as on 31.03.2016 is ' 31.86Crore.

5.3. Housing loan to public

The Bank has in place Housing Loan Scheme to meet the needs of all economic segmentsincluding NRIs. Financing housing sector in rural and urban parts of India is a thrustarea. The housing loan portfolio of Bank is ' 10550.79 Crore as on 31.03.2016 whichconstitutes 83.94% of total retail portfolio of the Bank. The housing loan schemes of theBank were revisited and revised schemes were launched like "purchase / constructionof new / existing house / flat repairs / renovation / alteration of existing house /flat purchase of plot and construction thereon". The Bank has also launched"Maha Combo Loan Scheme" for purchase of house and a car taken together.

5.3.2 Mahabank Top-Up Loan Scheme

In order to extend additional credit support to our standard housing loan borrowersBank has launched "Mahabank Top Up loan Scheme" w.e.f. 26.02.2016. Under thisscheme credit is extended for repair / renovation / furnishing of house children'seducation Marriage of Children Medical treatment buying a vehicle or hi-tech gadgetsetc.

5.4. Model Educational Loan scheme

With the objective of ensuring that all deserving students get opportunity to pursuehigher education the Bank implemented a Model Educational Loan Scheme as per IBAguidelines. As of March 2016 the Bank had lent ' 804.12 Crore to 30554 students. The Bankhas provided the facility of submission of application for education loan throughweb-access (on line) also. Bank has also introduced a new feature called "PreApproved Education Loan" to its "Model Education Loan Scheme" to addressthe requirement of multiple sanction letters required by students applying for study atforeign universities. Bank also has "Model Education Loan Scheme for as Skill Loanwhere loans can be sanctioned for completion of short duration job oriented skilldevelopment programmes. A loan up to '1.50 lakh can be sanctioned under the scheme.

5.5. Centralized Processing of loans

Bank has established Centralized Processing Cells for retail / commercial advances atall its 33 Zones for hassle free & due diligence of loans with aim to improveturnaround time.

5.6. Micro Finance

The Bank has always recognized the importance of credit to rural and urban poor fortaking economic activity. The SHGs have proved to be effective instruments for empowermentof women Bank has specialized SHG branches in all six lead districts and at GoregaonMumbai.

As on 31.03.2016 there were 139194 SHGs formed by the Bank out of which 107286 SHGshave been linked with the bank credit with outstanding of '154.62 Crore as on 31stMarch 2016.

5.7. Assistance to SC/ST beneficiaries:

The Bank has been actively extending finance to SC/ST beneficiaries through variousschemes. Total finance as on 31.03.2016 to SC/ST beneficiaries stood at ' 1728.34 Croreconstituting 15.73 per cent of advances to weaker sections.

5.8. Weaker Sector Advances:

Bank is providing credit facilities to small / marginal farmers share cropperlandless labor SC /ST Beneficiaries Self Help Groups Joint Liability Groups The totalportfolio of weaker Sector advance of our Bank as on 31.03.2016 stood at ' 10985 Croreconstituting 10.55% of ANBC.

5.9. Advances to Minority Community

A special cell has been set up at Head Office to review and ensure smooth flow ofCredit to minority community. The branches were identified in minority concentrateddistricts and special targets were allotted to these branches for lending to minoritycommunities. As of March 2016 advances to Minority community are at ' 3037.22 crore asagainst '3264.25 Crore of previous year.

5.10 Door Step Banking Services

Bank has introduced Door Step Banking Services for its High End Customers and theservices include Corporate and Retail Cash pickup and delivery & Cheque CollectionServices at Clients Doorstep.

5.11 BOM SBI International Credit Card

• The BOM-SBI card base is 45347 out of which 23542 cards are used and monthlyspend is approximately ' 12.00 Cr.

• The commission received from SBI Card is ' 66.00 Lakhs during the year 2015-16.


5.13.1 ATMs

• ATM site wise feasibility/viability study before relocation was advised and alsoto achieve more than 100 average daily hits per ATM.

• Continuous follow up for relocation of Low hit Lobby ATMs (Total 405) has beenmade and relocation of 335 lobby ATMs is done by 31.03.2016 Of the remaining 70 ATMsrelocations follow up is being made for early completion.

• Relocation of Onsite ATMs is geared up by empowering Zonal Offices by givingspecific guidelines and numbers of relocations

• Zonal managers are empowered with necessary inputs to decide and shift low hitATMs to suitable/viable locations. Analyzing the reasons for high number of hits on otherbank ATM locations (Remote on us) advised zones to survey the area and relocate the lowhit ATMs within the zone additionally Even if we have ATM in the vicinity.

• ATMs are being branded with display of our products / services at prominentplaces like Malls Marketing & Publicity point of view. Few such ATMs are beinginstalled in the leading malls of Pune. Two ATMs with branding are made operational in twoleading malls in the city of Pune.

• 100% relocation of low hit lobby ATMs is completed in Twelve (12) Zones viz.Aurangabad Delhi Goa Jalgaon Indore Jaipur Solapur Latur MCZ PCZ Satara &PEZ. Remaining Zones are followed up on daily basis.

5.13.2 INTERNET /SMS/Phone Banking

Bank could achieve an increase of 28% in Internet Banking 31% in Phone Banking and 33%in SMS banking over the previous year.

With continuous follow up and increase in net security through the Mahasecure for IBNusers substantial rise in users/online transactions is expected.


• Maha Mobile functionality has been customized and simplified for increasing theenrolments.

• A user manual on Internet Banking & New Maha Mobile functionality isprepared & sent to field staff for ready reference & marketing of the technologybased products.

• Bank has introduced a Incentive schemes for Branch staff & Cash Back Offerto customers for Downloading "Maha Mobile App" in the month of December 2015

• Maha Mobile App has been increased by 15744 nos. in the month of December 2015.

• Presently there are 112210 Mobile Banking users.

5.14 Tie Ups

5.14.1 Payment Gateway Services:

• Presently we are providing the facility of Payment Gateway to all our customersthrough our online aggregators.

• We have made tie up arrangement with following aggregators.


M/s Atom Technologies


M/s EBS solutions limited

M/s Ibibo i.e. PAYU

M/s TimesofMoney Limited

M/s Airpay

M/s CC Avenues

M/s Citrus Payment Solutions Pvt Ltd

M/s PayTm

M/s Techprocess payment Solutions

M/s SBI e pay

FSS Payment Solutions

5.14.2 ‘Remit2india’ facility

• "Remit2India" is a web-based person to person money transfer systemthat allows individuals particularly our Non-Resident Depositors to remit foreign currencyamount for credit to the Beneficiary account in India.

• Although the income is very less in this product but this facility/Serviceswhich we may be useful to attract NRI customers.

5.14.3 ECS Mandate and Direct Debit System

• Bank has a tie up with M/s Bajaj Finance Limited (Auto Finance) for CentralizedECS mandate verification & centralized direct debit system where in bank is receivingcommission of '50000/- per month for mandate verification & centralized direct debit.

• Similarly Bank has also a tie up with M/s Bajaj Finance Limited (ConsumerFinance) & TVS at Banglore.

5.14.4 Online Fee Collection

• We have an arrangement in CBS for online fee Collection of different institutes;Organizations etc. wherein Bank will be receiving the commission.

• We have already started IBPS (Indian Banking Personal Selection) online feecollection over the counter fee collection for Amravati collectorate etc.

5.14.5 Online Trading

• Bank has introduced Three Brokers under our Online Share Trading facility. i.e.M/s Religare Securities Limited M/s Reliance Securities Ltd. & M/s Ventura SecuritiesLimited for Online Share Trading.

• Zones have been advised to open the maximum trading accounts.


The Rural Development Centers at Hadapsar- Pune and Bhigwan in Pune District ofMaharashtra have been undertaking various rural developmental activities for the benefitof farmers' viz. Vermi compost Re-development of Saline Soils Soil Testing etc. Bank hasestablished Soil testing lab (STL) through MARDEF Trust at RDC Bhigwan. The Soil TestingLaboratory has analyzed 7418 Soil and Water samples in the year 2015-16 and accordinglycounseling is done. Farmers from the districts of Pune Ahmednagar Solapur and Satara aretaking benefit of the lab.

A Trust viz. Mahabank Agricultural Research and Rural Development Foundation (MARDEF)established by the bank undertakes various projects and village improvement programmes.MARDEF is imparting training to farmers on various subjects in Agriculture. Trust hasimplemented 94 training programmes for farmers at RDC Bhigwan and Hadapsar and hasbenefited 2363 farmers from April 2015 to March 2016.

The Bank has established Seven Mahabank Self Employment Training Institutes (MSETI) forproviding training to rural youth and women to enable them to acquire skills forself-employment through small business enterprises. The Institute has centers located atPune Nagpur Aurangabad Amravati Jalna Thane and Nasik. The Institute has so farimparted training to 21386 educated unemployed youths. The settlement rate is 56.00%.

Gramin Mahila Va Balak Vikas Mandal (GMVBVM) an NGO formed by Bank of Maharashtra andNational Institute of Bank Management is actively involved in formation nurturingtraining and ensuring linkage of SHGs to Bank Credit.

The Bank has opened Financial Literacy Centers in Six Lead Districts namely PuneNasik Aurangabad Satara Jalna and Thane for creating awareness about banking schemes.


7.1 Lead Bank Scheme

The Bank has Lead Bank responsibility in seven districts of Maharashtra State viz.Aurangabad Jalna Nasik Palghar Pune Satara and Thane. Every year district creditplans for the districts are prepared and implemented with the cooperation of other banksas well as in coordination with District Collectors of respective Districts.

7.2 State Level Bankers’ Committee

The Bank is the Convenor of State Level bankers' Committee (SLBC) for the State ofMaharashtra and prepares State Annual Credit Plan. The plan for the year 2015-16 was for '186620 /- crore which is highest in the country. The same was approved in a specialmeeting held under the Chairmanship of Hon'ble Chief Minister of Maharashtra. SLBC alsoensures holding of quarterly meetings regularly to oversee the implementation of StateAnnual Credit Plans priority sector lending and Govt. sponsored schemes in the State.Apart from regular SLBC meetings various other meetings are also organized by SLBC tocoordinate between various member banks State Government Government Agencies ReserveBank of India NABARD and the Central Government. SLBC coordinates a network of more than15000 bank branches in the state.

In FY 2015-16 the State suffered due to continual draught in more than 16000 villagesand also onslaught of natural calamities the brunt of which is mostly borne byAgriculture and related activities. SLBC has always been very proactive in such calamitiesby issuing necessary guidelines in respect of relief measures organizing special meetingsand guiding the members whenever necessary.

As SLBC convener Bank of Maharashtra coordinated implementation of Pradhan Mantri JanDhan Yojana (PMJDY) in the State of Maharashtra. A total of 136 lakh accounts were openedin the State and the State was declared as saturated for the purpose of opening ofaccounts. The process of opening of accounts is continued.

S L B C Maharashtra received award for highest Adhar seeding of PMJDY accounts fromDepartment of Financial Service MOF New Delhi.


Bank continued to actively participate in the Pradhan Mantri Jan Dhan Yojana (PMJDY)announced and launched by the Prime Minister of India.

Survey of all allotted 3051 rural Sub Service Areas (SSAs) and 755 urban wards wereconducted for identification of households having no bank account. The Bank has engaged2974 Bank Mitrs through corporate BCs and under own BCA model in all the allotted SSAs.The Bank Mitrs are being paid monthly remuneration regularly and minimum remuneration isensured by paying fixed monthly pay and variable commission.

Total 32.18 lakh Savings Bank accounts have been opened by the Bank during the PMJDYcampaign period and RuPay ATM Debit cards have been issued to all the accountholders.Savings accounts of all the identified uncovered households have been opened. The Bank hasmobilized ' 531.97 Crore in these accounts opened during the campaign period. The Bankalso implemented Aadhaar based account opening using e-KYC. The Bank is live on AadhaarEnabled Payment System (Onus and Off-us) and RuPay card PIN Based transactions. The Bankhas been processing the DBT (Direct Benefit Transfer) and DBTL (LPG Gas Subsidy) for theaccountholders. Bank is having highest number of AEPS transactions in banking industry.

The Bank has introduced micro insurance products for life (PMJJY). During thisfinancial year 769482 policies were issued under this scheme. Other accident microinsurance scheme launched (PMSBY) was also launched and as many as 1413165 policies areissued under this group insurance scheme .Atal pension Yojana was also implemented withfull vigour by our bank by issuing 43936 pension accounts under this scheme .

The Bank has a full-fledged call centre with toll free number 18001022636 for redressalof PMJDY grievances.

The Financial Literacy Material has been prepared in vernacular languages and suppliedto all Branches / Bank Mitrs for supplying the same to accountholders during FLC camps.Financial literacy camps are organized different schools in districts of Maharashtra. Allskilling centers /ITI are mapped under financial literacy project Bank has been awardedfor excellent performance in the field of financial inclusion from prestigious instituteslike IBA DFS and Economic Times.



8.1 Performance of Regional Rural Bank

Maharashtra Gramin Bank (MGB) is a Regional Rural Bank sponsored by the Bank havingits Head Office at Aurangabad Maharashtra State. Total no of branches as on 31.3.2016stood at 397 in its area of operation covering 17 out of 36 districts of MaharashtraState.

All 397 branches and controlling offices are now under CBS. MGB opened 06 new branchesduring this year.

Maharashtra Gramin Bank has crossed the benchmark of '10000 Cr Total Business and '100Cr Operating Profit by achieving '10224 Cr Total Business and '105 Cr Operating Profit ason 31.03.2016 with a YOY growth rate of 22.30%

The percentage of CASA to total deposit is 53.52 %.Operating profit of MGB is ' 105.20Crore (growth of 15.01 %). During the year 2015-16 MGB has grown by 22.48 % in totaldeposits and 22.06 % in advances.

Under Pradhan Mantri Jandhan Yojana surveys of all allotted 898 SSAs and 80 wards wereconducted for identification of households having no bank account. The Bank has coveredall allotted SSAs by engaging BCAs. Total 4.50 lakh accounts have been opened during thePMJDY campaign period and "RuPay ATM debit cards" have been issued to all theaccount holders.Maharashtra Gramin Bank has actively participated in the PMJJBY PMSBY andAPY as well as the PMMY scheme declared by GoI DFS.

Bank has achieved most of the Targets under MOU_DAP for the financial year 2015-16 inthe major Key performance parameters.

Growth in Core Deposit (%) 17.18% 22.48%
Growth in Advances (%) 23.02% 22.06%
Recovery % June 14 65% 67%
NPA Level Rs. 195.00 Cr Rs. 153.99 Cr.
Growth in Agriculture Advances 19.67% 25.18%
CD Ratio 75.44% 71.61%
Increase in No. of SHGs credit linked 2500 5067
Increase in No. of KCC Cards 35000 173483
Net Profit After Tax Rs. 45.50Cr Rs. 53.86 Cr.
Per Branch Profit Rs. 15.85 lacs Rs. 17.60 lacs
Per Employee Profit Rs. 4.19 lacs Rs. 4.67 lacs

8.2 The Maharashtra Executor & Trustee Company Pvt. Ltd.

Maharashtra Executor & Trustee Company Pvt. Ltd. (METCO) the 100% subsidiary ofBank of Maharashtra was established in 1946 with an aim to provide services auxiliary tobanking such as:

• Consultation Drafting & Execution of will

• Consultation Drafting and Management of Private Trusts / Public Trusts

• Management of investments & house properties as attorney

• Guardianship of minor's property

• Consultation for sale/purchase of property

• Filing of I-Tax Returns for individuals

The Company is located at Pune having its branch units at Pune Vashi-Mumbai Thane andNagpur. It is managing about 1085 Public & Private Trusts. During the year additional37 Wills were added making total 1110 Wills in its custody for execution.

At present the Company manages properties both movable and immovable of 72 clientsunder the Power of Attorney. The Company also acts as the Trustees in respect of 170policies under Married Women's Property Act and as Court appointed Guardian of minor'sproperty in 6 cases.

The net profit of METCO for F.Y 2015-16 is '41.01 lakh. It has for the first time(Maiden) proposed Dividend of 10% for the year 2015-2016 to its Shareholders.

The Board of Directors has passed New Memorandum of Association and Article ofAssociation paving way to the Company to undertake different types of other financialServices.


During the year 2015-16 the Bank has achieved various remarkable achievements in thefield of Official Language implementation:

Mumbai based prestigious Institution in the field of Hindi ‘Aashirvad' awardedfollowing trophies in a grand function held on 23.09.2015 to the Bank:

‘RajbhashaGourav’ Award to Bank's General Manager (HRM and Rajbhasha) ShriManoj Biswal.

'Special Award' to Bank of Maharashtra for Better Hindi Implementation duringthe year 2014-15.

On 07th October 2015 Hindi day function was held in Head Office Pune. Shri S.Muhnot Chairman & Managing Director of the Bank presided over the function. Dr.Sunil Deodhar renowned Hindi litterateur & Programme Executive of Akashvani Pune wasthe Chief Guest. Shri Manoj Biswal General Manager HRM & Rajbhasha was also gracedthe Function Bank's Executives Officers & Employees were also present.Bank'sInternal Rajbhasha Trophy Scheme winner Zonal Offices Branches and Head OfficeDepartments were awarded during the function.

An All India Rajbhasha Seminar was organized in Bengaluru on 28th and 29th December2015 for all Official Language Officers of the Bank. Shri S. Muhnot Chairman &Managing Director of the Bank inaugurated the seminar. Shri Manoj Biswal General ManagerHRM & Rajbhasha guided all the participants.

Rajbhasha Vibhag Head Office Pune published a collection of story stories‘Anubhuti' written by bank's own officers and employees.

As per instructions issued by DFS Ministry of Finance Govt. of India abridge-building exercise between Hindi and other Regional Languages our bank sponsorednumerous Hindi and Regional language programmes in various Zones. Sponsored programmesinclude literary meets dramas folk music and cultural programme.

Monthly Rajbhasha E-Patrika is being regularly published every month. As a newinitiative Brail script of Rajbhasha E-Patrika is also published for the benefit ofvisually challenged employees of the Bank.

During its visit on 17th September 2015 to Lucknow Committee of ParliamentaryCommittee on Official Language reviewed Official Language Implementation work of Bank'sLucknow Zonal Office. The honourable members of the Committee expressed their satisfactionregarding progressive use of Hindi and the implementation of new initiatives by the Bank.

Department of Financial Services Ministry of Finance Government of India New DelhiIndia has organized All India Rajbhasha Seminar & Review Meeting in Jaipur in thethird quarter of 2015-16 on 06th and 07th November 2015. Our Bank's General Manager HumanResources Management and Rajbhasha Shri Manoj Biswal represented the Bank in theprogramme and addressed the executives of all banks.

Joint Director Department of Financial Services Ministry of Finance Government ofIndia New Delhi Jaipurhas inspected our Jaipur Zonal Office on 05.11.2015. Heappreciated Hindi work of Jaipur Zonal Office.

Bank of Maharashtra is convener of Town Official Language Implementation Committees ofMumbai Pune Solapur Latur & Jalgaon. All the five Town Official LanguageImplementation Committees convened by the Bank conducted various activities throughout theyear and organized meetings as per schedule.

Our bank was awarded first prize in "C" Region on 26th November2015 by Town official Language Implementation Committee (Bank) Kolkata.

Our bank was awarded Second prize by Town official Language Implementation Committee(Bank) Nagpur.


Proactive steps were taken in view of the security requirements at the branches and forBank's staff and also for provisioning of physical security infrastructure at allbranches. This was done after analysis of the threat perception current crime scenariocrime pattern modus operandi of bank robberies the breaches of security and fireincidents besides equipping and training the security personnel and other bank staff tocounter any such eventuality.


The Directors confirm that in the preparation of the annual accounts for the year ended31.03.2016:

• The applicable accounting standards of the Institute of Chartered Accountants ofIndia have been followed along with proper explanation relating to material departuresif any;

• The accounting policies framed in accordance with the guidelines of the ReserveBank of India are consistently applied and proper disclosures are made for changes ifany;

• Reasonable and prudent judgment and estimates were made so as to give a true andfair view of the state of affairs of the Bank at the end of the financial year and theprofit of the Bank for the year.

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

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


• During the year 2015-16 the following changes took place in the Board ofDirectors:

• Shri R. Thamodharan was elected as Shareholder Director of the Bank w.e.f30.06.2015.

• Dr. Archana R. Dholakia was appointed as Part time Non Official Director of theBank w.e.f 28.01.2016.


The Board of Directors wishes to express sincere gratitude to the Government of Indiathe Reserve Bank of India the Securities and Exchange Board of India InsuranceRegulatory and Development Authority Indian Banks' Association and Stock Exchanges andCDSL for their valuable advice and support; to the customers and shareholders for theirpatronage; to the correspondents and associates for their cooperation and to all themembers of staff of "Mahabank Family" for their unstinted commitment andcontribution to the overall development of the Bank.

For and on behalf of the Board of Directors

(S. Muhnot)

Chairman and Managing Director

Place: Pune

Date: 12th May 2016