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 2018.
Performance: Domestic Business:
Overall Domestic Business of the Bank increased by 0.78% reached at Rs. 714712crore as on 31.03.2018 from Rs. 709183 crore as on 31.03.2017.
CASA deposits increased by 3.71% on Y-O-Y and Stood at Rs. 172787 crore SBdeposits grew by 2.86% and CD by 8.86%. Share of low cost deposits (CASA) in domesticdeposits improved from 39.84% as on 31.03.2017 to 41.43% as on 31.03.2018.
Total deposits decreased by 0.53% and stood at Rs. 421211 crores.
Advances registered a growth of 2.72% from Rs. 285725 crores to Rs. 293500crores.
Priority Sector lending constituted 40.80% of Adjusted Net Bank Credit and theshare of Agricultural Credit to Adjusted Net Bank Credit was 18.58%.
Retail Credit grew by 19.25% from Rs 40098 crores to Rs 47817 crores.
Overseas business has de-grown by 18.92% and stood at Rs. 182138 crore ason 31.03.2018 compared to Rs. 224637 crore as on 31.03.2017.
Global Business of the Bank stood at Rs.896850 crore as on 31.03.2018 againstRs.933820 crore as on 31.03.2017. The de-growth of 3.96% in business level has been as aresult of conscious decision of the Bank to rationalise its overseas exposure.
Total deposits decreased by 3.55% and stood at Rs. 520854 crores.
Advances decreased by 4.52% and stood at Rs. 375995 crores.
Operating profit at Rs.7139 crores and Net loss at Rs.6044 crores.
Capital Adequacy Ratio at 12.94% as against 10.875% prescribed by RBI (under BaselIII).
Net Worth at Rs.18992 crores declined by 4.60% over 31.03.2017.
Book value per share Rs.108.91.
Gross NPA ratio at 16.58% as on 31.03.2018. ??Net NPA ratio at 8.26% as on31.03.2018.
The Financial performance of the Bank for the year 2017-18 is summarised below
| || || ||(Amount in crore) |
|Particulars ||2016-17 ||2017-18 ||Growth (%) |
|Net Interest Income ||11826 ||10506 ||-11.16 |
|Non-Interest Income ||6772 ||5734 ||-15.34 |
|Operating Expenses ||8866 ||9101 ||2.65 |
|Operating Profit ||9733 ||7139 ||-26.65 |
|Provisions / Contingencies ||11291 ||13183 ||16.75 |
|Net Profit ||-1558 ||-6044 || |
|Earnings per share (Rs.) ||-15.72 ||-52.55 || |
|Book Value per share (Rs.) ||188.62 ||108.91 ||-42.26 |
|Return on Equity (%) ||-7.78 ||-31.07 || |
|Return on Average Assets (%) ||-0.24 ||-0.91 || |
Key Financial Ratios are presented below
| || ||(Percentage) (%) |
|Parameters ||2016-17 ||2017-18 |
|Yield on Advances ||7.98 ||7.15 |
|Yield on Investments ||7.58 ||7.25 |
|Yield on Funds ||6.41 ||6.16 |
|Cost of Deposits ||4.84 ||4.58 |
|Cost of Funds ||4.48 ||4.46 |
|Net Interest Margin ||2.20 ||1.92 |
|Non Interest Income to ||76.39 ||63.00 |
|Operating Expenses || || |
|Other Income to Average ||1.03 ||0.86 |
|Working Fund || || |
|Operating Expenses to Average ||1.45 ||1.47 |
|Working Fund || || |
|Staff Expenses to Average ||0.88 ||0.79 |
|Working Fund || || |
|Other Operating Expenses to ||0.57 ||0.68 |
|Average Working Fund || || |
|Asset Utilisation Ratio ||1.59 ||1.16 |
|Non Interest Income to Total ||14.70 ||13.09 |
|Income || || |
|Non Interest Income to Net ||36.41 ||35.31 |
|Income || || |
|Cost to Income Ratio ||47.67 ||56.04 |
During the year Bank has raised Rs. 9232 crore by issue of 558432131 fresh shares ofRs.10/- each at a price of Rs.165.32 to Government of India. Bank has also issued BaselIII compliant 8.79% Additional Tier I Bonds for an amount of Rs. 500 crore. Bank hasexercised the regulatory call option and redeemed all its Additional Tier I Bonds (Series1 to 5) for an amount of Rs. 5500 crore on 21.04.2018.
As per Basel III framework the Bank's Capital Adequacy Ratio was 12.94% which ishigher than the regulatory requirement of 10.875% Details of Capital Adequacy(BASEL II & III) are :
| ||BASEL III |
|Particulars ||31.03.2017 ||31.03.2018 |
|CET1 CRAR ||24858 ||7.17% ||24993 ||7.87% |
|AT1 CRAR ||6008 ||1.73% ||5905 ||1.86% |
|Tier I Capital ||30866 ||8.90% ||30898 ||9.73% |
|Tier II Capital ||11216 ||3.24% ||10199 ||3.21% |
|Total Capital ||42082 ||12.14% ||41097 ||12.94% |
|Risk Weighted Assets ||346611 || ||317546 || |
During the current year the Bank has implemented various initiatives for a Prompt TurnAround. A few of them are mentioned as under:
Concept of Area Managers and Star Prime implemented for being more customer focused andfor business development recovery digitization at ground level and re-activation ofbranches.
Monthly Campaign called "Ghar Ghar Dastak" being organized every month forspeeding up CASA NPA Recovery and Credit disbursement.
Special CASA campaigns "Amantran" organized with special focus onGovernment Business Associates HNIs & NRIs
Strategy for re-balancing of portfolio in favour of RAM advances (Retail Agricultureand MSME) and reducing exposure to Corporate sector.
A non-discriminatory OTS Scheme called "Mission Samaadhan" formulated forquick resolution of NPAs.
"Mission Rocket" launched to activate all the Scale-IV & V headedbranches.
"Swarna Dhara" Gold Loans have been intensified
Refurbishing select branches as "Star Digi" branches with high enddigitalized services for tech savvy customers.
IT initiative "Star Mahashakti" being implemented for taking the Bank'stechnological capability to next level.
Focus on Digitisation and Alternate Delivery Channels such as internet BankingDebit and Credit Cards POS machines.? One of the premier Banks in implementingconcept of Digital Village. Till now 325 villages converted into digital villages.
Activation of 561 Growth Centers through Business Correspondents (BCs) called"Star Points" for expanding our outreach.
Awards and Recognition:
Bank of India ranked as the 2nd Most Trusted Bank in the PSU Bank category byEconomic Times.
Bank of India has been conferred "Market Achievers' Award" in CurrencyDerivatives Segment amongst Public Sector Banks by NSE.
Bank of India awarded as "Best Performer in Currency Derivative Segment"amongst all Banks' Category by BSE.
IDRBT Banking Technology Excellence Award Best Bank for Managing IT Ecosystem largeBank category.
IDRBT Banking Technology Excellence Award Best Bank for Electronic Payments largebank category.
Bank of India awarded for Best Corporate Social Practices: Promoting Employment forPhysically Challenged and also for Support and improvement in Quality of Education from ETNOW- WORLD CSR DAY Award.
Bank of India awarded as "The Most Efficient Bank in Kenya" by ThinkBusiness Banking Award 2018.
Bank of India-Uganda Subsidiary awarded for "Best Company Keeping Image High Award2018" from Indian Business Forum Uganda.
Bank's In-House Journal Taarangan' conferred with Prestigious "ABCIMagazine of the Year Award 2017" at Mumbai
DIRECTORS' RESPONSIBILITY STATEMENT:
The Directors confirm that in the preparation of the annual accounts for the year endedMarch 31 2018: a) The applicable accounting standards have been followed along withproper explanation relating to material departures if any b) The accounting policiesframed in accordance with the guidelines of the Reserve Bank of India were consistentlyapplied. Reasonable and prudent judgments 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 of theprofit and loss of the Bank for the year ended March 31
2018. c) Proper and sufficient accounting records in accordance with the provisions ofapplicable laws governing banks in India for safeguarding . the assets of the Bank and forpreventing and detecting fraud and other irregularities d) Annual accounts have beenprepared on a going concern basis e) Internal financial controls system to be followed bythe Bank were laid down and that such internal financial controls are adequate and wereoperating effectively f) Proper systems have been devised to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.