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Central Bank of India.

BSE: 532885 Sector: Financials
NSE: CENTRALBK ISIN Code: INE483A01010
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OPEN 21.55
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VOLUME 98009
52-Week high 29.65
52-Week low 10.04
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Mkt Cap.(Rs cr) 18,621
Buy Price 21.45
Buy Qty 7826.00
Sell Price 21.50
Sell Qty 56462.00
OPEN 21.55
CLOSE 21.25
VOLUME 98009
52-Week high 29.65
52-Week low 10.04
P/E
Mkt Cap.(Rs cr) 18,621
Buy Price 21.45
Buy Qty 7826.00
Sell Price 21.50
Sell Qty 56462.00

Central Bank of India. (CENTRALBK) - Director Report

Company director report

Your Directors have pleasure in presenting the Annual Report of the Bank along with theAudited Statement of Accounts the Profit and Loss accounts and the cash flow statementfor the year ended March 31 2021.

1. PERFORMANCE HIGHLIGHTS

Total Business of the Bank stood at Rs. 506886 crore as at March 31 2021 compared toRs. 486007 crore as at March 31 2020.

Total Deposits stood at Rs. 329973 crore as against Rs. 313763 crore in March 31 2020.

Total Advances of the Bank stood at Rs. 176913 crore as against Rs. 172244 crore inMarch 31 2020.

Total Income for the financial year ended March 31 2021 was Rs. 25897 crore ascompared to Rs. 27200 crore for the financial year ended March 31 2020.

Non-Interest Income of the Bank stood at Rs. 3167 crore for the financial year endedMarch 31 2021 compared to Rs. 3637 crore for the financial year ended March 31 2020.

Operating Profit of the Bank increasedto Rs. 4630 crore for the financial year endedMarch 31 2021 as compared to Rs. 4344 crore for the corresponding previous financial yearended March 31 2020 showing increase of 6.58%.

The Bank has incurred Net Loss of Rs. 888 crore for the financial year ended March 312021 as compared to Net Loss of Rs. 1121 crore during previous financial year ended March31 2020.

Business per employee increased to Rs. 15.60 crore during the financial year endedMarch 31 2021 from Rs. 14.06 crore in the previous financial year ended March 31 2020.

Capital Adequacy Ratio (as per Basel-II) stood at 14.27 with Tier I at 10.73% and TierII at 3.54% for the financial year ended March 31 2021. Capital Adequacy Ratio (as perBasel-III) stood at 14.81% with Tier I at 12.82% and

Tier II at 1.99% for the financial year ended March 31 2021.

Net worth stood at Rs. 22702.90 crore as on March 31 2021.

Cash Recovery (including sale of NPA) reduced to Rs. 2963 crore in the financial yearended March 31 2021 as compared to Rs. 3326 crore in the previous financial year endedMarch 31 2020.

Gross NPA to Gross Advances improved to 16.55% as on March 31 2021 from 18.92% as onMarch 31 2020.

Net NPA to Net Advances reduced to 5.77% as on March 31 2021 as against 7.63% as onMarch 31 2020.

Provision Coverage Ratio improved to 82.54% as on March 31 2021 from 77.29% as onMarch 31 2020.

Net Interest Margin (NIM) remained at constant level of 2.78% in the financial yearended March 31 2021 as compared to the Financial Year ended March 31 2020.

Return on Assets (ROA) is -0.26% for the Financial Year ended March 31 2021.

The credit deployment under priority sector stood at Rs. 88222 crore during FY 2020-21.However to take an advantage of excessive lending over ANBC in Priority Sector creditBank undertook sale/purchase transactions in PSLCs. During the year Bank sold PSLCs worthRs. 22050 crore under PS Advances.

Agriculture Advance of the Bank stood at Rs. 36207 crore for the financial year endedMarch 31 2021 as against year ended March 31 2020. Rs. 34419crore for the previousfinancial MSME Advances for the Financial Year ended March 31 2021 stood at Rs. 32356crore without PSLC and Investment in SIDBI is Rs. 355.81 crore and Mudra Ltd. is Rs.133.63 crore.

Retail Loans increased to Rs. 49468 crore in financial year ended March 31 2021 fromRs. 46106 crore in financial year ended March 31 2020.

Housing Loan portfolio of the Bank stood at Rs. 27969 crore for the financial yearended March 31 2021 registering y-o-y growth of 8.44%. Housing Loan Portfolio constitutes56.54% of the total Retail Portfolio as on March 31 2021.

There are 46 RSETIs in 9 States of the country viz. Madhya Pradesh(18) Bihar(9)Maharashtra(6) Uttar Pradesh(5) West Bengal(3) Chhattisgarh(2) Rajasthan(1) Odissa(1)and Assam(1). During the year 2020-21 the RSETIs conducted 573 training programmes andimparted training to 15343 candidates. Out of this 12384 (i.e. 81%) trainees were settledthrough bank credit wage settlement and self-finance. Credit linkage of settledcandidates achieved is 6513 i.e. 43%.

Bank has 2 RRBs as on 31st March 2021 in 2 states covering 23 districts with a networkof 1174 branches.

Under Financial Inclusion Bank has covered 24311 villages by deploying 6532 BC Agents.Bank has opened 155 Urban Financial Inclusion centres. Bank has further opened 145 lakhBasic Saving Bank Deposit Accounts (BSBDA) through its BCs and Branches.

Total earning from Bancassurance business is Rs. 62.37 crore for the financial yearended March 31 2021.

As on 31st March 2021 Bank has network of 4608 branches spanning 63.69% branches inrural & semi-urban areas 3644 ATMs 10 satellite offices and 1 Extension Counteracross the country.

2. INCOME & EXPENDITURE

Details of income and expenditure for the financial year 2020-21 are given hereunder:

(Rs. in Crores)

31.03.2021 31.03.2020 variation %
1 INTEREST INCOME 22730 23563 (833) (3.54)
Advances 11638 12506 (868) (6.94)
Investments 10009 9916 93 0.94
Others 1083 1141 (58) (5.08)
2 NON INTEREST INCOME 3167 3637 (470) (12.92)
3 TOTAL INCOME (1+2) 25897 27200 (1303) (4.79)
4 INTEREST EXPENDED 14485 15934 (1449) (9.09)
Deposits 13994 15402 (1408) (9.14)
Others 491 532 (41) (7.71)
5 OPERATING EXPENSES 6782 6922 (140) (2.02)
Establishment 4141 4217 (76) (1.80)
Others 2641 2705 (64) (2.37)
6 TOTAL EXPENSES (4+5) 21267 22856 (1589) (6.95)
7 SPREAD (1-4) 8245 7629 616 8.07
8 OPERATING PROFIT (3-6) 4630 4344 286 6.58
9 PROVISIONS 5518 5465 53 0.97
10 PROVISIONS FOR TAX (436) 212 (648) (305.66)
11 NET PROFIT/(LOSS) (8-9) (888) (1121) 233 20.79

3. PROVISIONS

Details of Total Provisions of Rs. 5518 crore charged to the Profit and Loss Accountduring the financial year 2020-21 vis-a-vis previous financial year are detailed as under:(Rs. in Crores)

31.03.2021 (FY) 31.03.2020 (FY) Variation
Provisions for Standard Assets 263 172 91
Provisions for NPAs 5129 4230 899
Provisions for Restructured Accounts 76 (159) 235
Provision on Investments 399 1065 (666)
Provisions for Taxes (436) 212 (648)
Others 87 (55) 142
TOTAL 5518 5465 53

4. PROFITABILITY RATIOS

(In percentage)

31.03.2021 (FY) 31.03.2020 (FY)
Cost of Deposits 4.35 5.11
Cost of Funds 4.43 5.18
Yield on Advances 6.63 7.53
Yield on Investments 6.62 7.01
Net Interest Margin 2.78 2.78*
Cost to Income Ratio 59.43 61.44

*Figures have been recalculated/ regrouped wherever necessary to confirm the currentyear classification.

5. BUSINESS RATIOS

(In percentage)

31.03.2021 (FY) 31.03.2020 (FY)
Interest Income to Average Working Fund (AWF) 6.67 7.26*
Non-Interest Income to AWF 0.93 1.12*
Operating Profit to AWF 1.36 1.34*
Return on Average Assets (0.26) (0.35)
Business Per Employee (Rs. in crore) 15.60 14.06
Net Profit per Employee ( Rs. in lakh) (2.74) (3.27)

*Figures have been recalculated/ regrouped wherever necessary to confirm the currentyear classification.

6. CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)

The components of Capital Adequacy Ratio were as under:

31.03.2021 (FY)

31.03.2020 (FY)

Basel-II Basel-III Basel-II Basel-III
Tier-I 10.73 12.82 7.57 9.33
Tier-II 3.54 1.99 4.38 2.39
Capital Adequacy Ratio 14.27 14.81 11.95 11.72

7. NET PROFIT/LOSS

The Bank has incurred net loss amounting to Rs. 888 crore during the financial yearended March 31 2021. Board of Directors has not recommended any dividend on equity sharesfor the Financial Year 2020-21.

8. CHANGES IN THE BOARD DURING THE YEAR

During the year under review the following changes took place in the Board ofDirectors of the Bank:

Shri Thomas Mathew RBI Nominee Director ceased to be the Director of the Bank w.e.f.close of working hours on 28th September 2020 in terms of Notification of Ministry ofFinance Government of India.

Shri P. J. Thomas was appointed as RBI Nominee Director of the Bank in terms ofDepartment of Financial Services Government of India Notification w.e.f. 28th September2020.

Shri B. S. Shekhawat Executive Director ceased to be the Director of the Bank w.e.f.close of working hours on 8th October 2020.

Prof. (Dr.) Atmanand part time non-official director ceased to be the Director of theBank w.e.f. close of working hours on 26th December 2020.

Shri Pallav Mohapatra Managing Director & Chief Executive Officer ceased to be theDirector of the Bank w.e.f. close of working hours on 28th February 2021.

Shri M. V. Rao was appointed as Managing Director & Chief Executive Officer of theBank in terms of Department of Financial Services Government of India Notificationw.e.f. 01st March 2021.

Shri Vivek Wahi was appointed as Executive Director of the Bank in terms of Departmentof Financial Services Government of India Notification w.e.f. 10th March 2021.

Shri Rajeev Puri was appointed as Executive Director of the Bank in terms of Departmentof Financial Services Government of India Notification w.e.f. 10th March 2021.

The Board places on record its appreciation of valuable contribution extended by ShriB. S. Shekhawat Shri Thomas Mathew Prof. (Dr.) Atmanand and Shri Pallav Mohapatra whoceased to be the Directors of the Bank during the Financial Year 2020-21.

9. WHISTLE BLOWER POLICY

Bank follows Central Vigilance Commission Guidelines on Whistle Blower complaints underPublic Interest Disclosure and Protection of Informers (PIDPI) resolution. Bank has a webbased portal in the name of "Cent e-Whistleblower" to facilitate reporting ofmalpractices by Employees and Directors without revealing their identities which would beknown to the General Manager Central Audit and Inspection. Directors and Employees mayalso approach Chairman of the Audit Committee of the Board directly. This may help to curbmalpractices prevent frauds and boost up morale of the employees.

10. PROMPT CORRECTIVE ACTION

Reserve Bank of India vide their letter dated June 13 2017 has put the Bank underPrompt Corrective Action (PCA) in view of high net NPA and negative Return on Assets. Bankbelieves that corrective measures arising thereof will help in improving overallperformance of the Bank.

11. BUSINESS RESPONSIBILITY REPORT

Business Responsibility Report as stipulated under Regulation 34 of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 has been annexed to this report and also hosted on the website of the Bank(www.centralbankofindia.co.in).

12. DIRECTORS’ RESPONSIBILTY STATEMENT

The Directors confirm that in the preparation of the annual accounts for the financialyear ended March 31 2021: The applicable accounting standards have been followed alongwith proper explanation relating to material departure if any; The accounting policiesframed in accordance with the guidelines of the Reserve Bank of India were consistentlyapplied;

Reasonable and prudent judgement and estimates were made so as to give a true and fairview of the state of affairs of the Bank at the end of the financial year and of theprofit/ loss of the Bank for the financial year ended March 31 2021; Proper andsufficient care was taken for the maintenance of adequate accounting records in accordancewith the provisions of the applicable laws governing banks in India; The accounts havebeen prepared on a going concern basis; Internal Financial Controls are adequate and wereoperating effectively; and Proper systems have been devised to ensure compliance with theprovisions of all applicable laws and these systems are adequate and operatingeffectively.

13. CORPORATE GOVERNANCE

The Board of the Bank is committed to adopt best Corporate Governance practices in bothletter and spirit. The Bank has a well-documented system and practice on CorporateGovernance.

14. ACKNOWLEDGEMENT

The Board of Directors places on record its gratitude to the Government of IndiaReserve Bank of India and the Securities and Exchange Board of India for their valuableguidance and support. The Board acknowledges with gratitude the unstinted support andfaith of its employees customers and shareholders.

For and on behalf of the Board of Directors
Sd/-
Place : Mumbai M V Rao
Date : July 15 2021 Managing Director & Chief Executive Officer

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