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Bank of India.

BSE: 532149 Sector: Financials
NSE: BANKINDIA ISIN Code: INE084A01016
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VOLUME 588891
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OPEN 69.50
CLOSE 68.75
VOLUME 588891
52-Week high 110.05
52-Week low 57.45
P/E
Mkt Cap.(Rs cr) 23,250
Buy Price 71.00
Buy Qty 2671.00
Sell Price 71.45
Sell Qty 500.00

Bank of India. (BANKINDIA) - Director Report

Company director report

The Board of Directors have pleasure in presenting the Bank's Annual Report along withthe audited statement of accounts and the cash flow statement for the year ended 31stMarch 2019.

PERFORMANCE:

Domestic Business:

> Overall Domestic Business of the Bank increased by 4.93% reached at Rs. 749920crore as on 31.03.2019 from Rs. 714712 crore as on 31.03.2018.

> CASA deposits increased by 5.20% on Y-O-Y and Stood at Rs. 181765 crore SBdeposits grew by 7.61%. Share of low cost deposits (CASA) in domestic deposits improvedfrom 41.43% as on 31.03.2018 to 43.36% as on 31.03.2019.

> Total deposits increased by 0.14% and stood at Rs. 421783 crore.

> Gross Advances registered a growth of 11.80% from Rs. 293500 crores as on31.03.2018 to Rs. 328137 crores as on 31.03.2019.

> The domestic CD Ratio stood at 77.80% as on 31.03.2019.

> Share of RAM Advances to Total advances is 49.19% (i.e. Rs. 161425 crore) as on31.03.2019 as compared to 51.42% (i.e. Rs. 150924 crore) as on 31.03.2018.

> Priority Sector lending constituted 42.94% of Adjusted Net Bank Credit and theshare of Agricultural Credit to Adjusted Net Bank Credit was 18.86%.

> Retail Credit grew by 18.14% from Rs 47817 crore to Rs 56492 crore.

Overseas Business:

> Overseas business has de-grown by 15.56% and stood at Rs. 153803 crore as on31.03.2019 compared to Rs. 182138 crore as on 31.03.2018.

> The Overseas CD Ratio stood at 55.23% as on 31.03.2019.

Global Business:

> Global Business of the Bank stood at Rs.903723 crore as on 31.03.2019 againstRs.896850 crore as on 31.03.2018. The marginal growth of 0.77% in business level has beenas a result of conscious decision of the Bank to rationalise its overseas exposure.

> Total deposits stood at Rs. 520862 crores as on 31.03.2019.

> Gross Advances stood at Rs. 382860 crores as on 31.03.2019.

> The Global CD Ratio stood at 73.51% as on 31.03.2019.

> Global CASA stood at 39.75% as on 31.03.2019.

Financial Parameters:

> Operating profit increased by 13.35% (Rs. 953 crore) and reached at Rs.8092 croresas on 31.03.2019 on Y-O-Y basis.

> Net loss stood at Rs. 5547 crore as on 31.03.2019 from Rs. 6044 crore as on31.03.2018.

> Capital Adequacy Ratio stood at 14.19% as against 10.875% prescribed by RBI (underBasel III).

> Net Worth increased by 37.70% reached at Rs. 26152 crores as on 31.03.2019 fromRs. 18992 crore as on 31.03.2018.

> Book value per share is Rs. 79.81.

> Gross NPA amount reduced by 2.68% (i.e. Rs. 1667 crore) reached at Rs. 60661crore as on 31.03.2019 from Rs. 62328 crore as on 31.03.2018.

> Gross NPA percentage reduced to 15.84% as on 31.03.2019 from 16.58% as on31.03.2018.

> Net NPA amount reduced by 32.22% (i.e. Rs. 9088 crore) and reached at Rs. 19119crore as on 31.03.2019 from Rs. 28207 crore as on 31.03.2018.

> Net NPA percentage reduced to 5.61% as on 31.03.2019 from 8.26% as on 31.03.2018.

> The Financial performance of the Bank for the year 2018-19 is summarised below:

(Amount in crore)

Particulars

2017-18

2018-19

Growth

(%)

Net Interest Income

10506

13658

29.99

Non-Interest Income

5734

5132

-10.49

Operating Expenses

9101

10697

17.54

Operating Profit

7139

8092

13.35

Provisions / Contingencies

13183

13639

3.46

Net Profit/ Loss

-6044

-5547

8.22

Earnings per share (Rs.)

-52.55

-29.79

Book Value per share (Rs.)

108.91

79.81

Return on Equity (%)

-31.07

-24.57

Return on Average Assets (%)

-0.91

-0.84

Key Financial Ratios are presented below

(Percentage) (%)

Parameters

2017-18

2018-19

Yield on Advances

7.15

8.23

Yield on Investments

7.25

7.40

Yield on Funds

6.16

6.60

Parameters

2017-18

2018-19

Cost of Deposits

4.58

4.50

Cost of Funds

4.46

4.39

Net Interest Margin

1.92

2.56

Non Interest Income to Operating Expenses

63.00

47.97

Other Income to Average Working Fund

0.86

0.77

Operating Expenses to Average Working Fund

1.47

1.73

Staff Expenses to Average Working Fund

0.79

0.98

Other Operating Expenses to Average Working Fund

0.68

0.76

Asset Utilisation Ratio

1.16

1.31

Non Interest Income to Total Income

13.09

11.18

Non Interest Income to Net Income

35.31

27.31

Cost to Income Ratio

56.04

56.93

CAPITAL

> During the year Government of India has infused Rs.14724 crore capital for freshequity shares out of which Bank has made preferential allotment of 953758865 equityshares of Rs.10 each in accordance with the provisions of SEBI (Issue of Capital andDisclosure Requirements) Regulations 2018. The details of capital infused are as under:

Date of Capital

Issue Price per

Amount

Date of Allotment

Infusion

share (in Rs.)

(Rs. Crore)

26.12.2018

105.75

10086

16.02.2019

21.02.2019

89.60

4638

20.04.2019*

Total

14724

* In terms of RBI letter no. DBR.CO.BP.No. 8307/ 21.01.002/ 2018-19 dated 2nd April2019 the share application money of Rs.4638 Crore received on 21.02.2019 has beenconsidered for computation of CET 1 capital as on March 31 2019.

> Further the Bank under Bank of India- Employee Stock Purchase Scheme (ESPS) hasraised an amount of Rs. 660.80 crore. Under this scheme the Bank has allotted 62552188new equity shares having face value of Rs. 10/- each at a discount of 24.28% on the floorprice of Rs. 105.64 per share i.e. at an offer price of Rs. 80/- each. The details are asunder:

Name of the Shareholder

Issue Price per share (in Rs.)

Amount (Rs. Crore)

Date of Allotment

Bank's Employees (Offer Price Rs.80/- Share)

105.64

660.80

07.03.2019

> Bank has exercised the regulatory call option and redeemed Additional Tier-1 Bondsamounting Rs.5500 Crore (Series 1 to 5) on April 21 2018 Upper Tier II Bonds amountingto Rs.500 Crore on 16.10.2018 and IPDI bonds (Tier-1) amounting to Rs.400 Crore on11.02.2019.

> The Govt. of India vide their Gazette Notification dated March 312019 - April 62019 increased the authorised capital from Rs.3000 Crore (Rupees Three Thousand Crore) toRs.6000 Crore (Rupees Six Thousand Crore).

CAPITAL ADEQUACY:

> As per Basel III framework the Bank's Capital Adequacy Ratio was 14.19% which ishigher than the regulatory requirement of 10.875 %.

> Details of Capital Adequacy (BASEL III) are :

(' in crore)

Particulars

BASEL - III

31.03.2018

31.03.2019

CET1 CRAR

24993

7.87%

33683

11.01%

AT1 CRAR

5905

1.86%

...

...

Tier I Capital

30898

9.73%

33870

11.07%

Tier II Capital

10199

3.21%

9534

3.12%

Total Capital

41097

12.94%

43404

14.19%

Risk Weighted Assets

317546

305953

BUSINESS INITIATIVES:

> Concept of Area Managers and Star Prime implemented for being more customerfocused and for business development recovery digitization at ground level andre-activation of branches.

> Special CASA campaigns "Amantran" organized with special focus onGovernment Business Associates HNIs & NRIs.

> Strategy for re-balancing of portfolio in favour of RAM advances (RetailAgriculture and MSME) and reducing exposure to Corporate sector.

> A non-discriminatory OTS Scheme called "Mission Samaadhan" formulatedfor quick resolution of NPAs.

> "Swarna Dhara" - Gold Loans have been intensified.

> Refurbishing select branches as "Star Digi" branches with high enddigitalized services for tech savvy customers.

> "War Room" and "Watch room" formed in each Zone for RecoveryNPA reduction and credit monitoring/trigger management.

> Tech-driven Credit Monitoring System for tracking of ‘Early Warning Signals'under implementation.

> On boarded the Contactless Platform (psbloansin59minutes. com)

> Launched GST based Financing to MSME Borrowers.

> Actively participating in the Udyami Mitra Portal - marketplace for new MSMEloans.

> Digi Branches: 255 Select Branches converted to Digi Branches for meeting thedemands of Next Gen Customers.

> Star Mahashakti- Up gradation of IT platform from FINACLE 7 to FINACLE 10.

> Centralised processing centres: New 11 RBCs and 28 new SME City Centres opened andseparate 182 Gold Loan cells formed in all Zones within the existing infrastructure toincrease RAM business.

> "Enterprise wide Fraud Risk Management" framework initiated forreal-time fraud monitoring.

> Rationalisation of Domestic/overseas branches and ATMs being undertaken to reduceOperational Cost.

> Seamless "Information and communication Technology (ICT)" based basicbanking services enablement in Rural & unbanked areas.

> Selected as an "Authorized bank for Yen credit transaction by GOI-MOF"for Yen credit transaction.

> Synergizing of MCB with LCB and Branches to reduce the Operational Cost.

> Focus on Digitisation and Alternate Delivery Channels

> Activation of Growth Centers through Business Correspondents (BCs) called"Star Points" for expanding our outreach.

AWARDS AND RECOGNITION :

> 2nd Most Trusted Bank in the PSU Bank category by Economic Times.

> "Market Achievers' Award" in Currency Derivatives Segment amongst PublicSector Banks by NSE.

> "Best Performer in Currency Derivative Segment" amongst all Banks'Category by BSE.

> IDRBT Banking Technology Excellence Award Best Bank for Managing IT Ecosystemlarge Bank category.

> IDRBT Banking Technology Excellence Award Best Bank for Electronic Paymentslarge bank category.

> Bank has been conferred Second Position among PSU Banks for performance underSukanya Samriddhi by the National Savings Institute (Ministry of Finance) for the year2017-18

> "India's Top Organisation with Innovative HR Practices" award in PSUs bythe Asia Pacific HRM Congress for 2017-18.

> Bank of India awarded APY- Makers of Excellence Award by PFRDA for enrolment inAPY in November2018.

> "India's Top Organisation with Innovative HR Practices" award in PSUs inthe Asia Pacific HRM Congress in Bengaluru.

> "Best Corporate Social Practices" for promoting Employment forPhysically Challenged and also for Support and improvement in Quality of Education from ETNOW- WORLD CSR DAY.

> "India's Top Organisation with Innovative HR Practices" award in PSUs inthe Asia Pacific HRM Congress in Bengaluru.

> Best Corporate Social Practices for promoting Employment for Physically Challengedand also for Support and improvement in Quality of Education from ET NOW- WORLD CSR DAY.

> Runner up Trophy (3rd Prize) for Best Bank under - Atal PensionYojana-Transformative Leaders Campaign.

DIRECTORS' RESPONSIBILITY STATEMENT:

The Directors confirm that in the preparation of the annual accounts

for the year ended March 312019:

a) The applicable accounting standards have been followed along with proper explanationrelating to material departures if any

b) The accounting policies framed in accordance with the guidelines of the Reserve Bankof India were consistently applied. Reasonable and prudent judgments and estimates weremade so as to give a true and fair view of the state of affairs of the Bank at the end ofthe financial year and of the profit and loss of the Bank for the year ended March 312019.

c) Proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of applicable laws governing banks in India forsafeguarding the assets of the Bank and for preventing and detecting fraud and otherirregularities

d) Annual accounts have been prepared on a going concern basis

e) Internal financial controls system to be followed by the Bank were laid down andthat such internal financial controls are adequate and were operating effectively

f) Proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.