The Board of Directors have pleasure in presenting the Banks Annual Report alongwith audited accounts for the year ended 31st March 2016.
The Business of the Bank stood at Rs 362554.20 crore as on 31.03.2016 as against Rs352048.72 crore as on 31.03.2015. Total deposits of the Bank stood at Rs 208914.82 croreregistering a growth of 2.40%. The gross advances as at end-March 2016 stood at Rs153639.38 crore registering a growth of 3.78%. The credit deposit ratio of the Bank asat end - March 2016 stood at 73.61%. The Bank ensured adequate flow of credit to theproductive sectors of the economy. The Loans & Advances portfolio of the Bank is welldiversified and balanced. Bank's retail term deposits increased by 12.27% and the retailcredit increased by 17.94% during FY 2015-16. Net interest margin for FY 2015-16 was 2.66%as against 2.61% for FY 2014-15.
CAPITAL & RESERVES
During the year 2015-16 the Paid-up capital of the bank increased by Rs 21.55 croreand Share Premium by Rs 156.85 crore respectively by way of preferential allotment of21548758 equity shares of face value of Rs 10/- each to LIC @ Rs 82.79 per share(including premium). The capital & reserves as on March 31 2016 have gone upto Rs14941.15 crore as against Rs 13779.34 crore as at end March 2015 and the ratio of Capital& Reserves to average working funds stood at 6.54% as on 31.03.2016 as against 6.36%as on 31st March 2015.
Further the Bank received a sum of Rs.300.00 crore on 30.03.2016 as contribution of theCentral Government for preferential allotment of equity shares pending allotment. Theshareholders of the Bank in the Extraordinary General Meeting held on 02.05.2016 approvedthrough special resolution the issue and allotment of 24772914 equity shares of facevalue of Rs 10/- each to the Government of India @ Rs 121.10 per share (includingpremium). During the year the Bank has issued Basel III Compliant Tier II Bondsaggregating to Rs 1000 crore.
CAPITAL ADEQUACY RATIO
The Banks Capital Risk Weighted Assets Ratio (CRAR) as on 31.03.2016 under BaselIII guidelines stood at 11.76% as against 11.41% as on 31.03.2015. The Banks CapitalRisk Weighted Assets Ratio (CRAR) under Basel II stood at 12.80% as against 12.28% as on31.03.2015.
The Bank has posted a total income of Rs 21824.99 crore during the year as against Rs22082.78 crore last year. The Operating Profit of the Bank stood at Rs 3682.07 crore forthe year ended 31.03.2016. The Bank has earned a net profit of Rs 156.08 crore during thefiscal 2015-16.
Financial performance including appropriation from the Net Profit is given below:-
|FINANCIAL PERFORMANCE ||(AMT. ||IN Rs CRORE) |
| ||31.03.2016 ||31.03.2015 |
|Interest Income ||20058.71 ||19961.38 |
|Other Income ||1766.28 ||2121.40 |
|Total Income ||21824.99 ||22082.78 |
|Interest Paid ||14684.14 ||14877.19 |
|Operating Expenses ||3458.78 ||2978.52 |
|Total Expenses ||18142.92 ||17855.71 |
|Operating Profit ||3682.07 ||4227.07 |
|Provisions and Contingencies ||3525.99 ||3449.56 |
|Net Profit for the Year before ||156.08 ||777.51 |
|Exceptional Item || || |
|Less: Exceptional Item (Reversal of Income for FY 2013-14) ||0.00 ||280.43 |
|Net Profit for the year after ||156.08 ||497.08 |
|Exceptional Item || || |
|Add-Profit brought forward ||0.14 ||0.96 |
|Add-Investment Reserve Account ||42.26 ||0.00 |
|Net Profit available for appropriation ||198.48 ||498.04 |
|APPROPRIATION || || |
|Transferred to Statutory Reserve ||40.00 ||124.00 |
|Transferred to Revenue and ||0.00 ||3.00 |
|Other reserves || || |
|Transferred to Special Reserve u/s 36(1)(viii) of The Income Tax Act 1961 ||112.00 ||198.00 |
|Transferred to Capital Reserve ||18.76 ||0.00 |
|Transferred to Investment ||0.00 ||53.80 |
|Reserve Account || || |
|Interim Dividend ||0.00 ||0.00 |
|Proposed Dividend ||22.50 ||98.96 |
|Tax on Dividend ||4.58 ||20.14 |
|Balance carried over to Balance Sheet ||0.64 ||0.14 |
Bank's policy of declaring dividend is to reward the share holders as well as to ploughback profit for maintaining a healthy capital adequacy ratio & for supporting futuregrowth. Accordingly your Directors are pleased to propose a dividend of 7.00% (i.e. Rs0.70 per share) for the financial year ended 31st March 2016.
CORPORATE SOCIAL RESPONSIBILITY
Bank is a corporate citizen with resources at its command and benefits whichit derives from operating in society in general. It therefore has a commitment to giveback to the community where it operates and owes a solemn duty to the less fortunate andunderprivileged sections of the society.
Staff members are encouraged to make contributions by understanding theaspirations of underprivileged sections and endeavoring to evolve measures to removeindisputable social and development lacunae. This leads to their self development andimprovement of Bank's image besides development of the community.
Under the community service banking various welfare and social activities areundertaken by the bank both in Banking and non Banking areas to raise the quality of lifeof the downtrodden and under privileged sections of the society.
Providing assistance on education health sports and environment services arethe focus areas.
Major initiatives undertaken by the Bank in FY 2015-16
The CSR initiatives undertaken by the Bank are as under:-
Donation to KISS (Kalinga Institute of Social Sciences) Bhubaneshwar Orissa forproviding free education to 15 poor and needy Tribal Students for a period of one year.
Donation of Ceiling Fans to Umang Bal Vikas Patna 'S.C Secondary SchoolThiruvalla' Banglore 'Karamveer Patil Vidyalaya' Vada Village Khed Taluka- Pune &Nagarparishad Shikshan Mandal School Talegaon Dabhade Mumbai.
Donation of mattresses Bed Sheets Pillow covers and other utility items topoor and needy students of 'Shrimad Dayanand Vedharsh Mahavidyalya Nyas' Gautam NagarNew Delhi.
Donation of Computers Printer Inverter along with Batteries Wall Fans to'Asha Kiran' Dharuhera Haryana. 'Asha Kiran' is a home for destitute Girls.
Donation of LCD Projector and Screen to 'Manasa Rehabilitation Centre &Training Centre' (School for Special Children) Banglore.
Donation of utility items i.e School Bags Water Bottles & food items toorphan children at 'Bal Sahyog' Connaught Place New Delhi
Donation of Computers to Byculla jail Mumbai for skill training amongst theJail inmates.
Donation of chairs to TEARS an Institute of mentally handicapped children Agra
Donation for establishment of a Dialysis Unit in Civil Hospital Gurgaon incoordination with 'District Administration Gurgaon'.
The Bank along with 'Dr. Rajendra Prasad Centre for Ophthalmic Sciences AIIMSNew Delhi took the initiative for treatment of Retinoblastoma (Eye Cancer). The patientscoming from far-off areas on Pan-India basis specially those belonging to poor backgroundshall be benefited.
For the treatment of Eye ailments the Bank donated a Vitrectomy Machine to'Arunodaya Charitable Trust (ACT) Gurgaon'. The machine is being used for the treatmentof Eye ailments for poor and needy patients of far-flung areas of Guragon District.
Donation of "Laser with Scanner SS 500" physiotherapy machine to 'GuruVishram Vridh Ashram' run by 'Saint Hardayal Educational & Orphans Welfare Society'Delhi (SHEOWS) for the treatment and cure of poor and needy senior citizens.
The Bank also made efforts for the treatment of Cancer diseases in associationwith 'Indian Cancer Society Mumbai'.
The Bank made donations in association with 'Haryana State Fencing Association'Gurgaon for purchase of sports equipment for promoting Fencing Sports Activity.
Donation of Tricycles to differently able persons in Lucknow which acts as ameans of livelihood.
Adopted Dashashwamedh-ghat for 'Clean & Green' Ganga in coordination with'Gangotri Sewa Samiti' Varanasi. Bank has also taken initiatives for Cleaning of 'LalGhat' & 'Hanuman Garhi Ghat' at river Ganga Varanasi by adopting these holy areas.
Further the Bank has constructed toilets in various Govt. schools on priority and asfocused CSR activity as a step towards achieving the dream of a "Clean andSafe" India. In the Swachch Vidyalaya Campaign (FY 2015-16) the Bank constructed 119Toilets in which 87 Toilets are in rural areas and 32 in Semi-urban areas. These Toiletswere constructed in 83 Government Schools.
BOARD OF DIRECTORS
During 2015-2016 11 meetings of Board of Directors 17 meetings of ManagementCommittee of Board and 9 meetings of Audit Committee of Board were held. Sh. ArunishChawla joined the Board of the Bank as Government of India Nominee k Director on15.06.2015 in place of Sh. Rajan Kumar in terms of under Section 9(3)(b) of the BankingCompanies (Acquisition and Transfer of Undertakings) Act 1980 (the Act). Sh.Rajkiran Rai G. joined the Board of the Bank on 22.01.2016 as Executive Director in termsof Section 9(3)(a) of the Act. Sh. Bhupinder Nayyar and Sh. Suresh N Patel ExecutiveDirectors of the Bank vacated office as Directors on the Board of the Bank on 30.06.2015and 02.11.2015 due to superannuation and elevation as MD&CEO of Andhra Bankrespectively. Sh. Paras Mal Chopda vacated the office on 17.01.2016 on completion oftenure as Director of the Bank.
EXPLANATIONS/COMMENTS BY THE BOARD OF DIRECTORS IN RESPONSE TO MODIFIED OPINION /ADVERSE REMARKS / EMPHASIS OF MATTER IF ANY IN THE INDEPENDENT AUDITORS REPORT
In respect of Emphasis of matter drawn w.r.t. Note No. 9(c) of Schedule 18 the Bankhas amortised Rs 13.44 crore during the year ended 31st March 2016 and balance unamortizedamount of Rs 40.33 crore shall be amortised as per timelines permitted by RBI.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that in preparation of the Annual
Accounts for the year ended 31st March 2016: the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures if any
the accounting policies framed in accordance with the guidelines o f the ReserveBank of India w ere consistently applied
reasonable and prudent judgment and estimates were made so as to give true andfair view of the state of affairs of the Bank at the end of financial year and of theprofits of the Bank for the year ended on 31st March 2016
proper and sufficient care was taken for the maintenance of adequate accountingrecords in accordance with the provisions of applicable laws governing banks in India
Internal financial controls were laid down and these were adequate and operatingeffectively
Proper systems were in place to ensure compliance of all laws applicable to theBank and these were adequate and operating effectively
The accounts have been prepared on a going concern basis.
The Board of Directors expresses its gratitude to the Government of India Ministry ofFinance Department of Economic Affairs Reserve Bank of India (RBI) Securities andExchanges Board of India (SEBI) and other Government & Regulatory Agencies for theirvaluable guidance and continued support provided to the Bank throughout the year. TheBoard of Directors are also grateful to the valued customers esteemed stakeholders andalso wish to place on record its great appreciation of the staff members for theirinvolvement and dedication in the overall development growth and prosperity of the Bank.
| ||For and on behalf of the Board |
|Place: Gurgaon ||(ANIMESH CHAUHAN) |
|Date: 11.05.2016 ||MANAGING DIRECTOR & CEO |