Vijaya Bank

1. Economic Scenario

The global economy continues to recover amidst ongoing policy support and improvingfinancial market conditions. The recovery process is led by Emerging MarketEconomies(EMEs), especially those in Asia, as growth remains weak in advanced economies.The global economy continues to face several challenges, such as, high levels ofunemployment, which are close to 10% in the U.S. and the Euro area. Despite signs ofrenewed activity in manufacturing and improvement in retail sales, the prospects ofeconomic recovery in Europe are clouded by fiscal strains in some countries.

Core Inflation levels in major advanced economies are still moderating as the outputgap persists and unemployment remains high. Inflation expectations also remain wellanchored. In contrast, core inflation in EMEs, especially in Asia, have been rising. Thishas prompted Central Banks in some EMEs to begin phasing out their accommodative monetarypolicies.

The Indian Economy performed well during 2009-10. The overall growth of GDP as perAdvance Estimates of the Central Statistical Organisation (CSO) was 7.2% in 2009-10representing an increase from 6.7% during 2008-09. The final real GDP growth for 2009-10,as perceived by RBI, may settle between 7.2-7.5%. The share of Agriculture, Industry andServices Sector in GDP is estimated at 14.6%, 28.2% and 57.2% respectively in 2009-10.

During 2009-10 (April '09 -Jan.'10), Exports stood at US $131.8 billion, posting adecline of 17.9% as against the growth of 22.8% during the corresponding period last year.Imports during the similar period also recorded a decline of 19.8% as against growth of32% a year ago. India's Foreign Exchange Reserves stood at U.S. $ 279 billion at the endof March 2010. As regards recent Greek Debt Crisis, it could trigger short-termvulnerability, in terms of capital inflows in the Indian markets, though its long-termimpact might not be severe. On the inflation front, Y-o-Y inflation in terms of WholesalePrice Index (WPI) was 9.9% as at March 2010, exceeding the RBI's baseline projection of8.5% for March 2010. Inflation as measured by Consumer Price Index (CPI) stood much higherat 16.2% (Y-o-Y) in January 2010.

2. Banking Scenario

Growth in monetary and credit aggregates during 2009-10 remained broadly in line withthe RBI's projections. Aggregate Deposits of Scheduled Commercial Banks (SCBs) recorded aY-o-Y growth of 17% during the year, while Advances recorded a Y-o-Y growth of 16.7%compared to 18.2% last year. Scheduled Commercial Banks (SCBs) raised their deposit ratesby 25-50 basis points between February and April 2010, signaling a reversal of the trendin deposit rates. On the lending side, the Benchmark Prime Lending rates (BPLRs) of SCBshave remained unchanged since July 2009, following reductions in the range of 25-100 basispoints between March and June 2009.

For most part of 2009-10, the main focus of the RBI was on gradual withdrawal ofaccommodative monetary policy stance, which it had adopted earlier, in response to theglobal economic crisis of 2008. This was necessitated by the need to rein in theburgeoning fiscal deficit.

In continuation of the calibrated exit strategy, which it had pursed in the earlieryear, the RBI, in its Monetary Policy Statement for 2010-11 has further raised the reporate under the Liquidity Adjustment Facility (LAF) by 25 basis points from 5 per cent to5.25 per cent and the reverse repo rate under the LAF by 25 basis points from 3.5 per centto 3.75 per cent with effect from April 20, 2010. Further, the CRR has been increased by25 basis points from 5.75 per cent to 6 per cent. These measures are expected to anchorinflationary expectations and contain inflation going forward. As liquidity in the bankingsystem is likely to remain comfortable, credit expansion for sustaining therecovery may not be affected.

3. Outlook

In its World Economic Outlook Update for January 2010, the IMF projected that globalgrowth will recover from -0.8% in 2009 to 3.9% in 2010 and further to 4.3% in 2011. Threemajor factors that are likely to contribute to the global outlook are the massive monetaryand fiscal support, improvement in confidence and a strong recovery in EMEs.

On the domestic front, the Indian Economy is firmly on the recovery path. Exports havebeen expanding since October 2009, a trend that is expected to continue. The industrialrecovery is increasingly becoming broad based. A sustained increase in bank credit and inthe financial resources raised by the commercial sector from non-bank sources also suggestthat the recovery is gaining momentum.

On balance, under the assumption of a normal monsoon and sustenance of good performanceof the industrial and services sectors on the back of rising domestic and external demand,the baseline projection of real GDP growth for 2010-11 is placed at 8 per cent with anupward bias. On the Inflation front, keeping in view the domestic demand-supply balanceand the global trend in commodity prices, projection for WPI Inflation is placed at 5.5%for March 2011.

The need for sustainable developmental efforts by financial institutions in India hasassumed urgency and banks, in particular, can help contribute to this effort. RBI in itsnotification dated 20th November 2007 has advised banks to take note of the issues raisedand consider addressing the same by putting in place an appropriate plan of action towardshelping the cause of sustainable development.

4. Working Results

Operating profit posted by the Bank for the year 200910 was Rs. 1056.96 Crore ascompared to Rs.898.91 Crore in 2008-09, while the Net profit for the year 2009-10 amountedto Rs.507.29 Crore as compared to Rs.262.48 Crore in 2008-09, recording a growth rate of93.27%. On the deposit front, average cost of deposits decreased from 7.56% in 2008-09 to6.21% in 200910 mainly due to decrease in market interest rates and Bank's reducedrecourse to high-cost bulk deposits. However, the yield on advances recorded a decreasefrom 11.09% in 2008-09 to 10.26% in 2009-10, which was in keeping with the industry trend.

The trends in Bank's financial results and important ratios are highlighted in thetables below:

TABLE-1 Income-Expenditure Parameters

TABLE-2 Profitability/Efficiency Ratios

5. Dividend

Taking into consideration the overall profitability position, the Board of Directorshave recommended a dividend of Rs.2.50 per Equity Share of the face value of Rs. 10/-forthe year 2009-10, amounting to Rs. 108.38 Crore.

6. Capital Adequacy

Bank's capital adequacy ratio (Basel II) stood at 12.50% as on 31.03.2010 vis-a-vis theReserve Bank of India norm of 9%. The Tier I Capital Adequacy Ratio was 7.69% and Tier IIratio 4.81%.

7. Branch Network

Fifty seven additional branches were opened during the year taking the total network ofbranches from 1101 in March 2009 to 1158 in March 2010 with an all-India footprint. ThreeExtension Counters were opened during 2009-10, taking the tally of Extension Counters to46.

8. Deposit Mobilisation

Total deposits of the Bank increased from Rs. 54535.43 Crore as on 31.3.2009 toRs.61931.74 Crore as on 31.3.2010, recording an annual growth rate of 13.56 %. CASAdeposits recorded a 16.35% growth, accounting for 24.6% in the aggregate deposits. CASAdeposit growth was driven by 20% growth in SB deposits, which crossed the Rs. 10000 Croremark during the year.

During the year, Bank launched a new product 'V-GenU™ Unnati' RD Account 'for theGeneration Next' clients. The product received overwhelming response within a short spanof about two months as 26139 accounts were opened with balance of Rs.1.64 Crore. A DepositCampaign, covering Savings Account of different segments like the households, salariedclass and other niche segments was also launched by virtue of which nearly 5 lakh accountswere opened mobilizing in all Rs.640 40 Crore Apart from the Deposit campaigns, variousactivities were undertaken to nurture the new generation V-GenU^TH SB Accountholders and HNI segment of SB accounts. All these led the SB deposit portfolio to postgrowth that was one of the highest.

9. Credit Expansion

Gross advances of the Bank increased from Rs. 35874 63 Crore in March 2009 toRs.41934.53 Crore in March 2010, recording an annual growth rate of 16.89 %. The averagegross credit recorded an annual growth rate of 8.35% from Rs.34540.16 Crore in 2008-09 toRs.37424.90 Crore in 2009-10, reflecting low credit absorption trend for most part of theyear under review.

Infrastructure Finance

Advances to Infrastructure sector increased from Rs.7722 Crore in March 2009 toRs.10445 Crore in March 2010, registering a growth rate of 35.26%. Power sectors, Roads,Ports, Airports, Industrial Parks, SEZ, Pipelines for Gas/ Petroleum productstransportation, Telecommunication sector etc., were the major areas under infrastructurefinanced by the Bank.

Retail Credit

The Bank continued to accord priority to its Retail Lending Schemes viz., Housing Loan,Education Loan, Jewel Loans etc. However, Retail Credit segment witnessed sluggish growthduring the financial year 2009-10 in tune with the growth/trend prevailing in the industryon account of recessionary trends for most part of the year.

The Bank disbursed Rs 2857.98 Crore under Retail credit during the year & theamount outstanding as at March 2010 stood at Rs.9348.90 Crore. Retail Credit Portfolioaccounted for at 22.26% of the Bank's Gross Credit.

The Bank disbursed Rs.614.40 Crore under Housing loan, Rs. 144.44 Crore under Educationloan and Rs.359.46 Crore under Vehicle loans and Rs.718.91 Crore under Jewel loan schemesduring the year. The amount outstanding under Housing loan, Education loan, Motor Vehiclesloans & Jewel Loan schemes, as on 31st March 2010, was Rs.4525.60 Crore, Rs.534.47Crore, Rs. 791.98 Crore and Rs.571 Crore respectively. The Y-o-Y growth in Jewel loansegment was 65.90% and that under Education loan segment was 24%.

The Bank also introduced, during the year, a new Retail product called V-Gold CashCredit in order to cater to the needs of small businessmen, Retail traders andprofessionals, particularly in semi-urban and urban areas.

During the year, the Bank entered into tie-up arrangements with auto majors like AshokLeyland, Mahindra & Mahindra, V.E. Commercial Vehicles Ltd., (Eicher Motors) &TATA Motors Ltd, to step up the portfolio under vehicle loans.

Priority Sector Lending

Total Priority Sector advances of the Bank increased to Rs. 14553 Crore as atthe end of March 2010 as against Rs. 13450 Crore as at March 2009, registering a growthrate of 8.20% (Y-o-Y). Priority Sector Credit of the Bank constituted 40.57% of theAdjusted Net Bank Credit, as against the 40% stipulation.

Agricultural Finance

Direct Agricultural advances of the Bank as at March 2010 stood at Rs.3608 Crore, asagainst Rs.3053 Crore as at March 2009, registering a growth rate of 18.18% over March2009. Total Agricultural advances (with 4.50% cap on Indirect Finance for agriculture)stood at Rs 5222 Crore, which formed 14.56% of the Adjusted Net Bank Credit, as againstthe norm of 18%.

Under Special Agricultural Credit Plan, the Bank disbursed Rs.4103 Crore during theyear 2009-10, as against the target of Rs. 4713 Crore, which works out to an achievementratio of 87.06%.

Kisan Credit Card scheme

During the year under review, the Bank issued 42348 Kisan Cards and disbursed Rs.336.27Crore under the Scheme. The Bank also launched ATM enabled Kisan Credit Cards at someselect branches for the benefit of farmers.

Coverage of new farmers

During the year, the Bank financed 39728 new farmers and disbursed Rs.430.47 Croreunder various agricultural activities. The average number of new farmers financed comes to78 as against the Govt, of India' stipulation of a minimum of 100 new farmers per ruraland semi urban branch.

Financing Micro Small and Medium Enterprises (MSME):

Advances to Micro Small and Medium Enterprises increased to Rs.5436 crore as at March2010 from Rs.4552 Crore as at March 2009, signifying a Y-o-Y growth of 19.42%. As per thedirectives of Government of India, advances under the Micro, Small and Medium Enterprises(MSME) are to be doubled over a period of five years ended 2009-10. The Bank achieved thisin March 2008 itself.

Advances to Weaker Sections:

As at March 2010, outstanding advances to weaker sections stood at Rs.3462 Crore, whichconstitutes 9.65% of the ANBC as against the stipulated norm of 10%.

Credit to Women beneficiaries

Advances to Women beneficiaries stood at Rs. 2342 Crore as at March 2010 as againstRs.2052 Crore as at March 2009, registering a growth rate of 14.13%. Against thestipulated benchmark level of 5% of net bank credit to women, the Bank's achievement stoodat 6.52%.

Advances to SC / ST beneficiaries

Bank's total advances to SC / ST clients stood at Rs.705 Crore as at March 2010,against Rs.441 Crore as at March 2009, showing a 59.86% growth during the year.

Credit to Minority Communities:

Advances to Minority Communities stood at Rs.1566 Crore as at March 2010, constituting10.75% of total priority sector advances.

Lending under Govt. Sponsored Schemes:

Bank continued to accord emphasis on implementation of Government sponsored schemes. Asat March 2010, total outstandings under such schemes amounted to Rs.243.74 Crore,involving 26141 beneficiaries.

Self Help Groups (SHGs)

During the year 2009-10, the Bank financed 44243 SHGs and disbursed Rs.244 Crore.Cumulatively, the Bank so far financed 118257 SHGs and disbursed Rs.646 Crore. Inrecognition of its stellar performance in this vital area, the Bank was conferred BestPerformance Award for SHG-Bank Linkage in the State of Karnataka, for 2008-09.

Janashree Bima Yojana

It is one of the Schemes of LIC of India, wherein women members of SHGs are gettinglife cover and also insurance against permanent disability. Besides, their childrenstudying in 9th to 12th Standard are also provided with scholarship. Bank implemented thescheme for the benefit of women members of various SHGs. It has so far covered 1735members and disbursed scholarship of Rs.1.36 lakhs to eligible students.

Visveshvaraya Grameena Bank:

Visveshvaraya Grameena Bank (VGB), a Regional Rural Bank (RRB) sponsored by the Bankcontinued to make good progress during 2009-10. VGB with a total network of 30 branches inMandya District of Karnataka State, had total deposits and advances of Rs.191.35 Crore andRs.133.41 Crore respectively as at March 2010. The performance and workingresults of the VGB have been quite encouraging. VGB posted a net profit of Rs.335.48 lakhas on March 31, 2010.

Agricultural Debt Waiver and Debt Relief Scheme - 2008

The Bank actively participated in the Agriculture Debt Waiver and Debt Relief scheme ofGovernment of India. Under the scheme, the Bank extended loan waiver benefit to 47807small and marginal farmers amounting to Rs.147.12 Crore and identified relief benefit to21664 other farmers amounting to Rs. 60.41 Crore.

Financial Inclusion

As at March 2010, Bank had 2.72 lakhs No-frill accounts, with balance of Rs 29.99Crore. After successful implementation of the first phase of Financial Inclusion in allits three districts in Karnataka, Bank has taken forward the initiative to provide bankingservices at the door steps of its clients through Business Correspondent Model with Smartcard/ Hand Held Machine. Under Branchless banking, Bank has covered 14 villages inKarnataka State through 5 business correspondents/sub-Agents and issued 2300 smart cardsas on March 2010.

Under the Electronic Benefit Transfer Scheme (EBT), the Bank is disbursing SocialSecurity Pension and wages under Mahatma Gandhi National Rural Employment Guarantee Scheme(MGNREGS). Bank is also making the said payments in entire Mandya district under "OneDistrict One Bank Model". The Bank opened 459 accounts and issued 229 cards underMGNREGS while 29 accounts were opened, with Cards issued under Social Security Pension(SSP) Scheme. Further, under the said schemes, the Bank is participating in threeDistricts of Karnataka viz., Chitradurga, Bellary & Gulbarga where the scheme of 'OneDistrict. Many Banks Model' is implemented by Govt, of Karnataka on a pilot basis. TheBank opened 734 accounts and issued 652 Smart Cards under MGNREGS. Under SSP, 161 accountswere opened and Cards were issued.

During the year under reference, the Bank also prepared a comprehensive Road Map onFinancial Inclusion to be implemented over the next three years, covering over 500villages involving 600 business Correspondents and 6.50 lakh households in the country.Under the road map, the Bank aims to cover all its 361 service area villages havingpopulation of over 2000 during 2010-11. It has plans to cover the other villages over thenext two years.

In order to provide hassle-free credit to the 'No Frill account' holders for meetinggeneral credit requirements, Bank introduced 'Vijaya General Credit Card Scheme' with amaximum Credit limit of Rs.25,000/- at interest rate of 9.50% p.a.(fixed), wherein nosecurity/margin/commitment on end use is insisted. As at March 2010, Bank has financed1825 accounts under Vijaya General Credit Card with balance of Rs.109.34 lakh.

Bank participated in the Platinum Jubilee Celebrations of RBI, by organising 'Out-reachProgramme' at Kodihalli (Karnataka State) and provided banking services to all thevillagers by opening 855 No frill accounts.

Loan Restructuring

Keeping in view the prevailing trends in Industry and other sectors, the Bankrestructured eligible advances of needy borrowers, thus giving respite to these sectorsaffected by economic recession. During the year, the Bank restructured 7108 loan accountsinvolving an amount of Rs.1563 Crore, taking the cumulative number of accountsrestructured and amount to 16760 and Rs.2573 Crore respectively.

10. Asset Quality

The Bank continued its focus on maintaining quality assets along with thrust onpreventing fresh slippages. It initiated and continued to emphasise various measures inthis direction, including the following:

• Accounts showing signs of stress / likely default in dues are identified andtreated as Special Watch accounts and are closely monitored. Wherever feasible, suchassets are restructured, with additional need-based credit limits considered in deservingcases, to prevent fresh slippages.

• In case of wilful defaulters, stringent recovery measures, including legaloptions like Securitisation, Lok Adalats / DRTs, etc., are promptly resorted to.

• To facilitate speedy recovery, 'Vijaya Adalats' are regularly conducted tosettle dues of defaulters amicably. During the year, Bank could recover Rs.35.66 Croreunder 5594 accounts by way of such settlements.

The gross Non-Performing Assets of the Bank as on March 2010 worked out to 2.37 percent, while net NPA ratio was 1.40 per cent. During the year 2009-10, Bank could effecttotal cash recovery of Rs.424.82 Crore (including interest) and upgraded NPAs amounting toRs. 163.10 Crore. Further, the Bank also made provision of Rs. 194.59 Crore for theunexpected defaults, apart from having a floating provision of Rs.213 Crore as on March31, 2010. The Provision Coverage Ratio (including PWO) as at March 2010 worked out to64.24%

11. Investment and Fund Management

Total investment portfolio of the Bank increased from Rs 17388 Crore as on March 31,2009 to Rs 21107 Crore as on March 31, 2010. The average yield on investments (excludingprofit on sale of investments) during the year worked out to 6.67% as against 7.72% in2008-09. The liquidity position in the Bank was generally comfortable throughout the yearunder review. The Bank also complied with CRR/SLR requirements as stipulated by ReserveBank of India consistently during the year.

The Bank has successfully implemented the ITMS (Integrated Treasury ManagementSoftware) during the financial year and the same is interfaced with CBS platform.

Implementation of RTGS & NEFT

The Bank joined the Real Time Gross Settlement (RTGS) system on June 14, 2004 and hasbeen undertaking customer transactions with effect from January 12, 2005. As on March 31,2010, all Branches/ Extension counters/ Service Branches and Regional Offices of the Bankwere RTGS enabled. The Bank joined the National Electronic Funds Transfer (NEFT) schemewith effect from December 7, 2006. NEFT facility has been extended to cover all our RTGSenabled branches /Offices.

12. Risk Management

Risk management function in the Bank is overseen by several committees, including Boardlevel Committee, namely, Risk Management Committee of the Board (RMCB). The riskmanagement policies are implemented through Credit Risk Management Committee (CRMC),Operational Risk Management Committee (ORMC) and Asset Liability Management Committee(ALCO) at the corporate level, headed by the Chairman and Managing Director.

Apart from the primary risk policies, Bank has put in place several important riskrelated policies, such as, Internal Capital Adequacy Assessment Process (ICAAP), BusinessContinuity and Disaster Recovery Plan, Disclosure, Stress Testing, Collateral Management,Adoption of External Rating, Managing Risks on Outsourcing of Financial Services, ITsecurity, Country Risk Management policies, etc. These risk management policies are beingreviewed and revised periodically.

The Bank has carried out self assessment of its Risk Profile, based on the RBIprescribed Risk Profile Templates, on quarterly basis, vetted by a Quality Assurance Team,before submission to RBI and the Board.

Credit Risk

Lending Policy of the Bank is being revised from time to time, to include, amongothers, such aspects as risk appetite, risk based pricing, risk diversification/mitigationstrategy, prudential limits, exposure ceiling, preferred sector growth strategies, creditapproval process, documentation and security standards, security valuation, etc.

In order to enhance the effectiveness of Loan Review Mechanism, the Bank introducedOnsite Credit Audit for exposures of Rs 5 crore and above and also modified its LoanReview Mechanism for exposures below Rs. 5 crore. The Bank has also complied with the RBIrequirement of at least 30 to 40% of the credit exposures that are to be covered under theLoan Review Mechanism / Credit Audit. Stress Test on Credit Risk are also carried out onannual basis, in terms of the Stress Test policy of the Bank.

The Bank has put in place a comprehensive risk rating / scoring system that serves as asingle point indicator of diverse risk factors on the counterparty and for taking creditdecision in a prudent manner. A separate risk scoring model for Housing and other Retailsectors has also been evolved so as to ensure higher coverage under risk rating exercise,presently around 90%. Migration analysis is also carried out on quarterly basis in respectof exposures of Rs.1 Crore and above. From Sept 09, the Bank has introduced Credit riskrating software, which is Basel II compliant for conducting risk rating of all retail andnon-retail loans. This software enables the Bank to ensure that all types of exposures arecovered under risk rating before sanctioning of any loan so as to maintain the creditquality and also to move towards compliance with the advanced approaches under Basel II.

ALM and Market Risk

Asset Liability Management Committee (ALCO) in the Bank has devised appropriatetolerance limits for mismatches in different time buckets, for managing liquidity andinterest rate risks. These limits are being monitored at fortnightly intervals and arealso being placed before the Board.

Market risk assessment is done by tools like VaR (Value at Risk), AGL (Aggregate GapLimit) and Duration Gap Analysis. Single country limits and group limits for all countrieshave also been put in place to manage and monitor the country risk. Mid-office reports ontreasury operations are also placed before ALCO on a monthly basis, covering informationabout exceptions, reviews and compliance.

Interest rate risk on entire credit portfolio is identified and measured through toolslike Earnings at Risk (EaR). Besides, Portfolio Sensitivity analysis is conducted andreviewed by the top management. Further, Contingency Funding Plans, Prudential Ratios /Limits have been set and actual position is monitored as part of Liquidity RiskManagement. Stress Test on Interest Rate Risk, Liquidity Risk, Forex, etc on differentscenarios are also carried out on quarterly basis and appraised to ALCO. To monitor shortterm liquidity, ALM statements and Mid Office reports on daily basis are also generated.

Operational Risk

With a view to mitigating various Operational Risks, several studies were conductedduring the year. These include studies on functioning of the data centre, Retail AssetsCentralized Processing Cells, RTGS/NEFT etc. The Bank has started implementing thequalifying criteria for the Standardized Approach by putting critical business processesunder RCSA (Risk & Control Self Assessment) exercise. Two RCSA workshops at HeadOffice level and 8 RCSA workshops at Regional Office level were conducted during the yearwherein assessment of risks and the corresponding control measures were evaluated inrespect of 7 operational areas. The Bank has constituted a Business Continuity ManagementCommittee (BCMC) at the apex level and various Emergency Response Teams at HO/RO/ Branchesto oversee implementation and management of the business continuity and relatedactivities. During the year, the Bank also reviewed its Business Continuity & DisasterRecovery Plan.

Basel-ll Compliance

In order to comply with the Basel II norms, the Bank has been carrying out parallel runexercise on the capital adequacy calculation in the RBI prescribed format, on a quarterlybasis and apprising the Board, apart from submitting the same to RBI.

Besides, the Bank has entered into MOU with four rating agencies viz. CRISIL, ICRA,CARE and Fitch, for risk rating of its corporate clients.

In compliance with the RBI guidelines on Standardised Approach for Credit Risk,Standardised Duration Approach for Market Risk and Basic Indicator Approach forOperational Risk, Bank has complied with Basel II norms and the overall Capital AdequacyRatio as at 31st March 2010 worked out to 12.5 %, as against the minimum stipulated normof 9%.

Integrated Risk Management System (IRMS) Project.

In order to facilitate smooth and effective transition to the Basel-ll framework, theBank has taken up implementation of an Integrated Risk Management System (IRMS).

The IRMS Project consists of six solutions, viz., Credit Risk Management (CRM), MarketRisk Management (MRM), Operational Risk Management (ORM), Credit Risk Rating Solution(CRR) (Retail & Non-Retail), Asset Liability Management (ALM) and Funds TransferPricing (FTP) Solution. During the year, the Bank implemented Phase I of this project i.e.achieving the Standardized Approaches and is steadily moving forward towards implementingthe Advanced Approaches.

13. International Banking

As at March 2010, foreign business turnover of the Bank stood at Rs. 12530 Crore,comprising Rs.5479 Crore under export, Rs.2360 Crore under imports and Rs.4691 Crore underremittance business.

The Bank is participating in the Rupee Drawing Arrangement with six Exchange Houses andthree non-resident banks from Middle East. Besides, it has drawing arrangement and theCheque collection facility with correspondent Banks abroad to serve clients.

"Vijaya Bank Speed Remittance" facility facilitates online credit ofremittances from Gulf Countries through Exchange houses directly to the customer's accountwith the Bank's branches. Presently, this facility is extended to UAE Exchange Centre LLC.Abu Dhabi, UAE. Similar arrangements are planned to be forged with other Exchange Housesalso.

With a view to improving the NRI deposits, the bank has deputed its officials to UAEfor canvassing NRI accounts of expatriate Indians.

14. Merchant Banking & Allied Activities

Vijaya Bank is a SEBI registered category I Merchant Banker, Bankers to Issue,Debenture Trustee and Depository Participant. The Bank is also registered as 'SelfCertified Syndicate Bank' (SCSB) for accepting IPO/Rights issue applications underApplications Supported by Blocked Amount (ASBA) scheme.

The Bank undertakes Payment Bankers Assignments for payment of Interest/Dividend/Refundorders of Corporates.

Bank also offers Depository Services to its clients. Towards providing value addedservice to the investor community, the Bank proposes to launch an Online Trading portal,now in advanced stage of implementation.

Government Business

Amongst various Government business, Bank is collecting Direct Tax at its 288designated branches and also Indirect Tax at 37 branches. E-Payment facility for thepayment of taxes is available to customers through all branches. Besides, PPF accounts canbe opened in 153 designated branches and State and Central pension payments are disbursedthrough all the branches of the Bank.

15. Card Business

Under Credit card operations of the Bank, the cumulative card base as of March 2010 was1.48 lakh, with a turnover of Rs.445 Crore. There are 1098 Merchant Establishment enrolledwith the Bank.

Under Debit cards, the bank continued to make good progress during 2009-10. As at March2010, Debit card base of the bank stood at 11.35 lakh compared to 7.05 lakh as at the endof last financial year.

Bank offers a special Savings Bank deposit scheme, V-GenU™ SB account, for minors.Account holders of the scheme who are above 12 years of age are issued with speciallydesigned ATM cards, for cash withdrawal at the Bank's ATMs.

16. Marketing Setup

Marketing Division at the bank's H.O. is actively engaged in designing new products,reviewing and fine-tuning existing products, conducting marketing campaigns, creatingawareness on technology-backed Alternate Delivery Channels (ADC) offered by the Bank.

To nurture the customer friendly schemes of the Bank, like V-GenU™ SB Account,V-GenU™ Unnati RD Account, V-Platinum SB Account etc, Bank is sending Greeting cardsto the customers on important occasions like birthdays, Examinations, Festivals etc. Toenhance the hidden talents among children, V-GenU™ Drawing Competitions for differentage groups were also conducted and over 5000 responses were received. Interactive eventslike V-GenU™ 'Hungama' were held at apartment complexes in major cities to give aboost to the growth of the new generation products of the bank. The Bank also conductedthe 24th State Level Inter-High School Vijaya Bank V-GenU™ Quiz Contest during theyear. All these initiatives yielded very encouraging results for the Bank's core depositportfolio and stronger relationship building with such clients.

17. Publicity and Public Relations

The Bank is continuing the existing outdoor publicity projects aimed at achievingheightened visibility through displays at prominent locations like Railway Stations, BusStands and hoardings at prominent public places, highways and airports. During the lastfinancial year, the Bank also carried out a major print media Ad campaign in the North andCentral India in Hindi and regional language to elevate the visibility of Bank and itsproducts /services.

18. Customer Service and Redressal of Complaints

There is a full fledged Grievance Redressal Mechanism in the Bank and all efforts arebeing made to resolve complaints within the stipulated time The Bank has constituted aStanding Committee on Customer Service, which includes a customer as its member. ACustomer Service Committee of the Board, which also includes a customer as one of itsmembers, has also been constituted by the Bank. These Committees are meeting periodicallyand evaluating and monitoring the customer service and addressing the deficiencies. TheBank also conducted a Customer Service study in Bangalore city and arrived at informativeinference. The study is proposed to be extended to other metro cities, for proactivelyinvolving customers as integral part of Bank's overall business strategy.

Banking Codes and Standards Board of India (BCSBI)

Bank is a member of BCSBI and it has already adopted the voluntary Codes formulated byBCSBI i.e. (i) 'Code of Bank's Commitment to Customers' (ii) 'Code of Bank's Commitment toMicro and Small Enterprises'. Bank has also formulated and complied with several policiesas per the guidelines of BCSBI.

19. Information Technology (IT) Info Tech Progress

The Bank implemented, to varying extents, an Integrated Treasury Management System(ITMS), Human Resources Management System (HRMS), and Integrated Risk Management System(IRMS) during the year 2009-10. These systems have been operationalised and integratedwith the Core Banking System on a centralized platform. These projects are expected to berolled out enterprise wide during the current financial year.

Having brought all branches under Core Banking Solution, RTGS and NEFT services areavailable to the Bank's customers from all its branches. Since Straight Through Processing(STP) has been enabled in RTGS and NEFT, the customers do enjoy the benefit of immediateinter-bank fund transfer facility.

During the year under review, SMS Alert facility was launched by the Bank. As at March31, 2010, about 3.65 lakh customers of the Bank have opted for this service offered freewith value propositions.

The Bank has upgraded the infrastructure including the hardware at its Data Centre atBangalore and the Disaster Recovery Centre at Mumbai to take care of the increasedrequirement of computing capacity after migration of all branches to CBS.

V-Moblie

During the year 2009-10, Bank launched V-Mobile, its mobile banking module. The productoffers facilities like balance enquiry, mini statements, funds transfer, bill payment,mobile currency charging facilities etc. As on 31.03.2010, there were 17840 registeredusers of V-Mobile.

Internet Banking:

V-Net Banking, the internet banking module of the Bank was upgraded to a higher versionduring 2009-10. V-Net Banking now facilitates features like online funds transfer to otherBanks through NEFT/RTGS, Online Registration of beneficiary, availability of the latestchallan formats for remittance of service tax, Central Excise etc in addition to theearlier facilities like balance enquiry, account statement, intra bank funds transfer,transaction related SMS alerts, payment of indirect taxes, direct taxes and utility billpayments etc. With all the branches working on Core Banking platform, all customers of theBank can avail this facility with the convenience of accessing and transacting in theiraccount from any location at any time through Internet. So far, 44887 clients are enrolledunder the V-Net banking module.

Alternate Delivery Channels

In order to ensure that technology driven Alternate Delivery Channels are utilized tothe mutual advantage of the customers and the Bank, Marketing Cell has undertaken a numberof activities. Mailers were sent to customers highlighting the advantages of usingAlternate delivery Channels like internet banking, use of Debit Card, on-line purchases,funds transfer through RTGS/NEFT etc. In all the training programmers of the StaffCollege, one session on Alternate Delivery Channel is conducted for the benefit offrontline staff. In order to ensure that these facilities percolate to the customer, staffmembers are being familiarized with these channels through workshops. Apart from in-houseworkshops, IDRBT has already conducted workshops on RTGS/NEFT in Bangalore, Mangalore, andHyderabad.

ATMs

During the year 2009-10, 71 more ATMs were operationalised, taking the number of Bank'sATMs to 435 as at the end of March 2010. Bank's customers have now access to more than56000 ATMs connected under National Financial Switch (NFS) across the country.

Internal Control (IT)

The Bank has well documented policies for IT & IS Security, Internet Banking, ITProcurement, Internet usage, e-mail usage, Business Continuity, Disaster Recovery,Outsourcing etc., covering wide range of functions at the field and administrative levels.Adequate controls are built-in to mitigate the risks associated with each of theseactivities. These policies are reviewed periodically.

Information Security

The Bank is having well laid down policies on IT& IS Security, which are regularlyreviewed and approved by the Board of Directors. Time tested systems are also put in placeand best practices are followed for the protection of information system assets.

Networking

Bank has brought all its branches, Extension Counters and offices under the corporateWide Area Network (WAN) and achieved 100% networking of the branches. It also makes use ofthe latest technologies like MPLS, VSATs, Radio frequency, CDMA etc. for establishingseamless connectivity.

Cheque Truncation System (C.T.S)

As directed by the Reserve Bank of India, the Bank has successfully implemented chequetruncation system in NCR of Delhi. Bank is awaiting RBI's directions for rollout of theC.T.S. in other centres.

20. Human Resources Management

Manpower & Staff Productivity:

Total staff strength of the Bank stood at 11565 in March 2010 as compared to 11,975 inMarch 2009. Of the total staff, 5194 are Officers, 3866 Clerical Staff and 2505 are in thesubordinate cadre. The number of women employees as at the end of March 2010 stood at 2211consisting of 905 Officers and 1306 Award Staff, constituting 19.12% of total employees inthe Bank. As at the end of March 2010, there were 199 employees belonging to physicallychallenged category and 568 employees belonging to Ex-Servicemen category.

Productivity, measured by Business per Employee as of March 2010 stood at Rs.9.30 Croreas against Rs.7.85 Crore for the financial year ended March 2009.

Recruitment and Promotions:

Bank is in the process of recruiting of 500 Clerks, besides recruiting 123 officers inJMG-S-I and 3 officers in MMG-II. Through Lateral recruitment, the Bank also roped in 112officials in MMG-S-II and 6 officials in MMG-S-III cadres during 2009-10.

Training:

Training system in the Bank has been strengthened by providing additional and competentmanpower and enhanced budgetary allocation. The training curriculum has also beenfine-tuned, in tune with the changing market dynamics.

Four executives attended Seminars/ Conferences held abroad during the year, while 348Branch Heads and 6 Faculty Members were trained on 'Effective Branch Management' programmeconducted by NIBM, Pune. The Bank had imparted Comprehensive Training for 85 officials inCredit, 60 officials in Forex and 90 officials in Marketing during the year 2009-10.

In all, the Bank, during the last financial year, imparted training to 7031 employeesconstituting about 61% of the total employees. While 6289 employees had undergone trainingin the Bank's own establishments, 742 were trained at reputed external traininginstitutions including overseas institutions.

SC/ST Employees:

Out of the total manpower of 11565 as at the end of March 2010, 1636 employees belongto SC category and 588 to ST category. A separate Cell for SC/ST has been created to lookinto the matters pertaining to these employees and also to supervise implementation ofGovernment of India guidelines in service matters in respect of SCs/STs. SC/ST Cells arefunctioning in all the Regional Offices as well. The Chief Liaison Officer at H.O. isinvolved in all the policy decisions concerning SC/ST employees. Quarterly meetings areheld between representatives of SC/ST employees and the management. The Bank is alsoarranging pre-recruitment / pre-promotion training for SCs/STs regularly.

Further, the Bank has designated one General Manager as Chief Liaison Officer to attendto the grievances of OBC and Minority Community Employees Bank is complying with theReservation Policy of the Govt, of India, including reservation for Persons withDisability.

Staff Relation :

Continuation of the pro-active and humanistic approach by the Bank during the yearyielded positive results for the Bank as it scaled new heights of excellence. Industrialrelations in the Bank were cordial and harmonious, during the year. The consultativecommittee meetings and negotiating committee meetings were held with the representativesof the recognized unions at regular intervals to sort out the grievances of theemployees and to settle the disputes, if any, amicably. These meetings were attendedby the top executives of the Bank as well.

Promotion of Sports Activity

During the year under reference, Bank continued to accord emphasis on promotion ofSports and Sports personalities on its rolls. Several sports personnel of the Bankparticipated in the various events and won prizes during the year.

Basketball: Bank's Basketball team participated and won the State Association CupBasketball Championship for the 14^th successive year. The team also won theState Senior League Championships -2009 Four members of the Bank's team representedKarnataka State for the National Basketball Championship held at Ludhiana during the year.

Cricket: Bank's Sri R. Vinay Kumar was nominated as captain of the Karnataka stateteam for the K.S.Subbiah Pillai Trophy held at Chennai. Sri. C.M.Goutham and Sri S.I.Akshay also represented the Karnataka state.

Sri R. Vinay Kumar and Sri CM. Goutham also represented the South Zone team for theDuleep trophy and Deodhar trophy championships in 2009-10.

Sri R. Vinay Kumar who took active and rewarding part in the 3rd edition of the IPL,was crowned with the India cap for the T20 World Cup scheduled during end-April, 2010 inthe West Indies.

Kabaddi: Bank's Kabaddi Team participated in the Karnataka State Industries Kabadditournament and State A Division League Championship and won both the events. Besides, SriK Manoj and Sri. Selvaraj, members of Bank's Kabaddi team, were selected to attend theNational Kabaddi Coaching Camp held at SAI Sports Complex, Sonepat during October2009.

Weight Lifting: Sri S. Prakasha, member of Bank's weight lifting team participated andsecured second place [silver medal- in 77kg weight class] in the State weight liftingchampionship held at Bangalore during the year.

Staff welfare measures

The Bank is having various staff welfare schemes, such as, Canteen Subsidy, conveyance,Annual Health Check up, Health Clinic at HO, annual medical aid to the employees retiredon superannuation, newspaper reimbursement, grant of Silver Jubilee awards, house rentreimbursement, Holiday Homes etc.,

The Bank is having a separate Staff Welfare Fund Trust with an objective of providingwelfare facilities to the employees and their dependents viz, Awarding scholarships to thewards of the employees, reimbursement of residual claim of hospitalization expenses,reimbursement of cost of spectacles, funeral expenses to the dependents of the deceasedemployee, Cash Incentive to the employees who retire from the services of the bank onattaining the age of superannuation etc.,

Family Welfare Scheme has also been devised under which contributions collected fromthe members of that scheme are distributed among the family members (nominees) of deceasedemployees.

Human Resources Management System:

To enable faster decision making and error-free centralized employees' data management,the Bank is implementing HRMS (Peoplesoft) Software. Several Modules of the software havealready been operationalised.

21. Housekeeping

Reconciliation with regard to all inter bank transactions has been drawn up to31.03.2010. As against the Reserve Bank of India Benchmark of six months forreconciliation of outstanding inter branch entries, Bank's present status is 3 months. Alloutstanding entries under different sensitive accounts are also being followed uppromptly. Except entries relating to pending court cases, all other long outstandingentries have been eliminated.

22. Internal Inspection

The Bank has put in place a well-defined Audit policy. The Audit Committee of Boardoversees the performance of audit functions on a regular basis, providing guidance anddirections for improvement in the audit system and internal controls in the Bank.

The Bank conducts regularly Risk Based Internal Audit and Surprise Inspections. Inaddition, inspection of 41 Forex Branches, 12 Services Branches, 27 Currency Chests, 10Regional Offices and 7 Head Office Departments were conducted during the year. Branchesare also subjected to IS Audit in accordance with the IS Audit Policy

Bank has covered 76.54% of its business under concurrent audit by external firms ofChartered Accountants whereas 17 branches were subjected to Concurrent Audit by ourInternal Inspectors. Bank is making use of Information Technology in its audit systemincluding Automation in Risk Based Internal Audit System (RBIA).

Know Your Customer / Anti Money Laundering.

Due to technological advancement, Money Launderers move funds faster across continentsmaking detection and prevention thereof difficult. Bank has taken several initiatives tobe more vigilant while opening account as well as in monitoring operations more closely,as per the guidelines under Prevention of Money Laundering Act.

• Bank has a Policy on 'Know Your Customer' & 'Anti Money Laundering' in placeas per the guidelines issued by Reserve Bank of India and Indian Banks' Association.

• Account Opening Forms have also been modified to capture the risk category ofthe customers.

• Anti-Money Laundering Software (AML Software) for detecting suspicioustransactions in CBS environment has been installed and Suspicious Transaction Reports(STRs) are being generated and submitted to FIU, India. The Counterfeit Currency Reports(CCRs) are also being sent to FIU (I) as per the guidelines.

• Cash Transaction Report (CTR) in Electronic form is also regularly submitted toFinancial Intelligence Unit (FIU), India on a monthly basis.

Bank has included a special session in training programmes to sensitize the staff onthe importance of and adherences to Know Your Customer/ Anti Money Laundering concepts

23. Vigilance

The Vigilance Department at the Bank's Head Office is headed by Chief Vigilance Officerin the rank of Chief General Manager. The Fraud Prevention & Monitoring Ceil isalso functioning under the Vigilance Department. The Vigilance Department overseas allvigilance functions of the Bank as per the guidelines of Central Vigilance Commission.Cases of frauds involving Rs.1 lakh & above are placed before the Board of Directors,reports forwarded to RBI as and when frauds are detected and reported. The Audit Committeeof the Board is also apprised of frauds of Rs.1 lakh & above on quarterly basis. Incompliance with RBI guidelines, a Special Committee of the Board is constituted to reviewlarge value frauds involving Rs.1 Crore & above. After studying modus operandi offrauds detected, Bank issues suitable instructions to the field functionaries as apreventive Vigilance measure. Bank has also put in place "Whistle-Blowers"Policy; accordingly, it is the bounden duty of staff members to report to the ChiefVigilance Officer/ Executive Director/ Chairman & Managing Director the incidence offraud/malpractices, etc. which come to their knowledge in the course of their day-to-dayfunctioning.

Further, the Vigilance Department carries out surprise inspection of branches,concentrating on preventive vigilance by Field Vigilance Officers stationed at RegionalOffices. All efforts are made to plug the loopholes in the existing system to preventrecurrence of similar frauds and to strengthen the preventive vigilance machinery.

24. Compliance

Board approved Compliance Policy is a requirement under the extant RBI guidelines andaccordingly, the Bank adopted a Compliance Policy. The Compliance Department, H.O. ensurescompliance with various communications received at Head Office from Govt, of India,Reserve Bank of India, IBA and others by sending all such communications to the concernedoperational Departments for necessary action. The Compliance Department is headed by theChief Compliance Office-who is in the rank of a Deputy General Manager.

25. Right to Information Act. 2005

Government of India has enacted the Right to Information Act, 2005 which has come intoforce on October 12, 2005. The Act provides for right to every citizens to secure accessto information under the control of public authorities, consistent with public interest.It aims to promote openness, transparency and accountability in administration and inrelation to matters connected therewith or incidental thereto.

The second line Executive at the Regional Offices are designated as the PublicInformation Officer and the Regional Heads are designated as the Appellate Authority underthe Act. At the Head Office, a Deputy General Manager is designated as the PublicInformation Officer and a General Manager as the Appellate Authority.

As per the provisions of the Act, various information sought under the Act is beingprovided within the prescribed time frame. During the year 2009-10, the Bank received 377applications and 52 appeals under the Act and the same have been responded to by the Bank.

26. Security Arrangements

The Bank has a well-established Security set-up, facilitating all the essential andmandatory security arrangements at branches and currency chests as per RBI/IBA guidelines.1056 Branches of the Bank are provided with strong room conforming to RBI specification.However, branches without strong room as per RBI specification are proposed to be shiftedto new premises in a phased manner. CCTV Surveillance System has been installed at selectbranches keeping in view the threat perception, volume of cash and valuables handled andneed for continuous surveillance.

The Bank has 29 currency chests. Police guards have been provided to 28 currencychests. A private security agency sponsored by Directorate General of Resettlement hasbeen arranged for round the clock guarding of Bank's Bhubaneshwar Currency Chest.

Training, including firing practice organized for Armed Guards deployed at currencychests / branches, is imparted on an annual basis. Security Committees formed at RegionalOffices and at the Head Office meet periodically to review various security aspects.

The Bank has 414 Armed Guards posted to vulnerable branches / cash escort duties atcurrency chests and for guarding Head Office.

There were no incidents of Dacoity /Robbery, except, eight incidents of Burglary atbranches reported. However, there was no loss of cash or property.

27. Progressive Use of Hindi

Bank could achieve Hindi correspondence percentage of 94.58% in area 'A', 90.87% inarea 'B' and 69.63% in area 'C as on 31.03.2010, thanks to enterprise-vide initiatives andefforts.

Seven of the Bank's Regional Offices conducted Hindi symposium in which School/ collegeteachers, students, customers and staff members participated. Special Hindi workshops wereconducted for 134 Bank Executives. A session on 'Unicode' has been included in all HindiWorkshops, as it is required to be followed as per the Presidential Orders onrecommendation of Parliamentary Committee on Official Language. The Bank activelyparticipated in the National Seminar in Hindi organised by C.A.B. RBI, Pune. 82 Hindiworkshops were conducted for staff members in which 1439 staff members were trained. TheBank also has a Bilingual website.

The Parliamentary Committee on Official Language (Draft and Evidence Committee)inspected Town Official Language Implementation Committee (TOLIC) Bhubaneshwar andappreciated the work done by the Bank in progressive use of Hindi.

28. Awards

In recognition of performance in implementing Hindi Language, the Bank was awarded IIIprize under the prestigious INDIRA GANDHI RAJBHASHA PURASKAR for the year 2007-08. TheBank has also been awarded II prize in Region 'C" for Progressive Use of Hindi underReserve Bank Rajbhasha Shield Scheme for the year 2008-09.

The Bank was awarded I prize by Regional Implementation Office (North- East), Ministryof Home, Govt, of India in North Eastern Region for Progressive Use of Hindi for the year2008-09. SLBC Gujarat also conferred on the Bank III prize for effective implementation ofthe Official Language.

The Bank's Regional Office, Bangalore (North) was awarded I Prize by TOLIC, Bangalorefor effective Implementation of Official Language for the year 2008-09. Also RegionalOffices, Kolkata and Hubli, were awarded II Prize by TOLIC, Kolkata and Hubli respectivelyfor effective Implementation of Official Language. Regional Office, Ahmedabad has beenawarded Consolation prize by TOLIC, Ahmedabad during the year.

The staff members working in Bangalore city participated in the Inter-Bank competitionsconducted under the aegis of TOLIC. 12 competitions were conducted, in which our Bankbagged 9 prizes, out which 2 were First prizes.

During the year, the Bank received an award from the NABARD in recognition of thehighest share of SHG business to its overall business, under SHG Bank linkage programmefor the year 2008-09, among commercial Banks in the State of Karnataka.

29. Corporate Social Responsibility

As a responsible and responsive corporate citizen, Vijaya Bank consistently engagesitself in community and social investment. Among the various initiatives,

• For the cause of promoting Education, Bank donated a class Room to St. MariaGoretti Higher Primary School at Kukkundur, Karkala, contributed Rs.5 lakhs to BharatiyaVidya Bhavan, Shimoga, for construction of Building, donated computers to S.B. High Schoolat Holalkere, contributed to 'Akshaya Patra' school children's mid-day meal programme, inKarnataka State.

• Bank contributed Rs.33.70 lakhs for the development of a Circle at Mangalorenamed after Sri A.B.Shetty, the founder Chairman of the Bank.

• To encourage cultural activities, Bank contributed Rs. 10 lakhs for Vishwa TuluKoota- a congregation of village folk for cultural activities at Ujire organized by SriKshetra Dharmastala Rural Development Programme and contributed Rs.2 lakh for the popularDasara Cultural activities at Mysore.

• In a move towards promoting health care, donations were given to Helpage India,Bangalore for conducting Cataract operations, to Nazareth Hospital, Lucknow for providingbeds to poor patients. Bank also provided drinking water Cooler to SSA Mandal at Akkalkot,Maharastra, in addition to putting up educative/public utility sign Boards at Bangalore,Mysore and Konkan Railway Stations.

• Apart from the above, the Bank has Vijaya Rural Development Foundation (VRDF)and Vijaya Bank Self-Employment Training Institutes (VIBSETI) devoted to the cause ofimparting training under various job-oriented activities.

• Financial Inclusion is yet another aspect where the Bank has actively involveditself.

Vijaya Rural Development Foundation:

During the year, VRDF conducted 66 training / awareness programmes, covering a widerange of subjects, benefiting 5074 persons. Free health camps have also been organised forthe benefit of the rural masses.

The Foundation also granted scholarships to poor meritorious students hailing fromvillages and studying in Government schools. The Foundation has since expanded itsactivities to other districts like Haveri, Dharwad and Mandya, where the Bank has LeadBank Responsibility.

VIBSETIs (Vijaya Bank Self-Employment Training Institutes):

Bank has a Self-employment Training Institute, Vijaya Bank Self Employment TrainingInstitute (VIBSETI) at Mandya in Karnataka. The Institute has its own Campus withresidential facilities for the trainees. It has been conducting various vocationaltraining / skill up-gradation / awareness programmes and product development workshopsetc. During the year, the Institute conducted 56 Programmes involving 472 training daysand trained 1843 beneficiaries, of whom 1330 are settled with own ventures/gainfulself-employment. Cumulatively 355 programmes were conducted training 12417 beneficiariesof which 8677 have settled with gainful self-employment. The second VIBSETI at Haveriestablished in the year 2003, conducted 72 programmes during the year involving 277training days and trained 2968 candidates, of whom 2462 are settled with various gainfulself-employment ventures. Cumulatively, 324 programmes have been conducted by theinstitute training 11966 beneficiaries of whom 8861 have settled with gainfulself-employment.

30. Board meetings and Meetings of other Sub Committees of the Board

During the year, 12 Meetings of the Board of Directors, 19 Meetings of the ManagementCommittee of the Board, 9 Meetings of the Audit Committee of the Board, 4 Meetings of theDirectors' Promotion Committee, 6 Meetings of the Risk Management Committee of the Board,4 Meetings of the Committee to Review Large Value Frauds of Rs.1 Crore and above, 2Meetings of the Remuneration Committee, one Meeting of the Nomination Committee, 4Meetings of the Customer Service Committee, 4 Meetings of the Shareholders'/ Investors'Grievances Committee and 12 Meetings of the Share Transfer Committee were held.

31. Board of Directors

During the year 2009-10, the following changes have taken place in the Constitution ofthe Bank's Board :-

1. Shri. S C Kalia, Executive Director demitted the Office of Vijaya Bank on20.11.2009.

2. Mrs. Shubhalakshmi Panse has been appointed as Executive Director of the Bank w.e.f.20.11.09 vice Shri. S.C. Kalia.

3. Shri. Brij Mohan Sharma, Non Official Director appointed under CA category ceased tobe the Director w.e.f. 2.1.2010.

The Bank's Board as on 31st March. 2010 comprised the following Directors :-

i. Shri Albert Tauro, Chairman & Managing Director

ii. Mrs. Shubhalakshmi Panse, Executive Director

iii. Shri G.B. Singh, Government Nominee Director

iv. Shri K. Venkatappa, RBI Nominee Director

v. Shri P. Shantharam Shetty, Workmen Director

vi. Shri Ranjan Shetty, Officer-employee Director

vii. Shri Nishank Kumar Jain, Non Official Director

viii. Shri Sridhar Cherukuri, Non Official Director

ix. Shri B. Ibrahim, Non Official Director

x. Shri Ashok Kumar, I.A.S (Retd.), Shareholder Director

xi. Shri Ashok Kumar Shetty, Shareholder Director

xii. Shri S. Ananthan, Shareholder Director

The Board of Directors place on record their appreciation of the valuable servicesrendered by Shri. SC. Kalia and Shri. Brij Mohan Sharma during their respective tenure inthe Bank.

Acknowledgement

The Board of Directors place on record their sincere appreciation for the excellentsupport and co-operation extended to the Bank by all customers, shareholders, staffmembers, financial institutions and other Banks, the Reserve Bank of India, the StateGovernments, the Securities and Exchange Board of India and the Government of India inimproving its overall performance during the year 2009-10.

for and on behalf of the Board of Directors