Message of the MD & CEO:
It's Heartening to welcome you to the 14th Annual General Meeting of our Bank andplace forth the bank's performance during the financial year 2016-17. The performance ofthe bank in various key parameters and the strategic initiatives taken by the bank duringthe period is dealt with elaborately in the report. To set the stage for the same Iwould provide the overview of the bank's performance and the proposed course of action tocreate sustainable value for our stakeholders.
Despite mixed global outlook our economy is estimated to grow at 7.4% in 2017-18against 7.1% during FY 2016-17 based on the pick-up in consumption demand and increasedpublic investment. The government's focus in fortifying the rural sector coupled withemphasis upon digital transaction transparency and a galore of other economic and socialreforms would pave way for deepening of the financial services market to the bottom of thepyramid; particularly into the largely untapped rural markets. The bank is committed tocapitalize on this opportunity and translate into profitable avenues of business. Bankingindustry witnessed a muted credit growth of 5.1% while deposit grew at 11.8% by 31stMarch 2017. Credit growth was impacted by loan write offs swapping of bank credit underUDAY (Ujwal DISCOM Assurance Yojana) scheme use of SBNs for repaying loans and depressedinvestment cycle. RBI has changed the policy rates two times in FY 2016-17.
FY 2016-17 was a period of challenges and changes. The bank reoriented itself activelyto thwart the challenges and prepared for a turnaround journey to achieve sustainableprofitability.
Global business of the bank stood at Rs. 332940 crore as of Mar'17 against Rs.342626 crore as of Mar'16. This is partly attributed to the conscious shedding of bulkdeposits & focusing upon retail business and also because of slowdown in industrialcredit offtake and poor earnings growth.
Global deposits stood at Rs. 201285 as of Mar'17 against Rs. 207118 as ofMar'16.
Global advances stood at Rs. 131655 crore as of Mar'17 against Rs. 135508 crorea year ago.
Bank's CASA proportion was 33.92% of Total deposits.
Savings deposits rose by 27.25% during the financial year partly due todemonetization.
Bank has registered a net loss of Rs. 1851 crore for FY
2016-17 against a loss of Rs. 2799 crore for FY 2015-16. The bank is under itsturnaround phase. The bank has complied with the asset classification and provisioningrequirements in respect of all the borrower accounts identified by RBI during assetquality review.
The bank's customer base expanded by 8% to reach 3.10crore by Mar'17.
Bank has contributed to the government's inclusion aspirations by participatingin schemes like PMJDY
(5728882 accounts) PMSBY (1113611 enrolments) PMJJBY (617865 enrolments) andAPY (49614 subscribers) for bringing maximum number of citizens into the fold offinancial services.
Initiatives during FY 2016-17:
During the year FY 2016-17 all resources of the bank were dedicated towards measuresthat would result in long -term benefits for the bank. The following is an indicative listof the many initiatives taken by the bank during the year:
The bank has tied up with several online portals to provide exclusive offers toits customers.
Bank had introduced Interest capitalization scheme for our existing Home Loancustomers.
Till 31.03.2017 14 different payment gateway aggregators have been integratedfor online payment to merchants.
POS terminal facility has been introduced to cater to the needs of our merchantcustomers.
Online Subscriptions facility through internet Banking for Sovereign Gold Bonds& APY has been implemented.
UCO Pay e-wallet has been launched and aggressively marketed to promote digitaltransactions.
UCO Smart Pay a Smart way for the collection of fees/ charges forCollege/School and other institutions for paying online/offline to educationalinstitutions or any other corporates/institutions has been launched.
PMMY (Pradhan Mantri Mudra Yojana) application module has been operationalizedin UCO M-Banking.
An MSE application module has been made active in UCO
24x7 Cyber Security Operation Centre (SOC) has been operationalized.
The triple objectives of increasing CASA increasing advances and improving assetquality by effective credit monitoring and recovery measures stays valid for this yeartoo. These along with the other strategic approaches will not only help in turnaroundplans of the bank but also create long-term value for the stakeholders by establishingStable Alternate Revenue Streams apart from fortifying the existing avenues of business.
UCO Bank's commitment to be 'Corporate with Social Responsibility' guides it in allits undertakings. Technological innovations will be encouraged to build products andprocesses that facilitates the bank's employees to deliver delightful banking experiencewith human touch.
(R K Takkar)
Managing Director & Chief Executive Officer