DIRECTOR REPORT
Dear Members,
On behalf of the Board of Directors and my own, I wholeheartedly welcome you all on the
occasion of 52nd Annual General Meeting of the Bank. I have great pleasure and honour to
share with you the financial performance as well as the sound position of your Bank for
the year ended on 31st March 2014.
At the outset, let me congratulate all the Shareholders and Customers of your Bank for
crossing milestone of business-mix of Rs.2100 Crores by 31st March 2014.
The Co-operative Banking Sector has been passing through crucial period due to the
changing scenario in banking as well as industrial sector, market instability and severe
competition. In spite of turbulent situation, Bank could be able to achieve the remarkable
progress during the financial year.
ECONOMIC SCENARIO-
Financial year 2013-14 was a challenging year for the commercial sector as well as
banking sector as economic growth slowed down to a decade low. During the year 2013-14,
Indias real gross domestic product grew at 4.7 percent, while global situation remained
adverse, the prospects deteriorated further with domestic challenges like high inflation
at retail level, rupee depreciation, slowing consumption and a weak investment climate.
Banking sector is the mirror image of the overall economic situation and therefore faced
challenges during the fiscal year 2013-14.
PERFORMANCES/HIGHLIGHTS FOR THE YEAR 2013-2014-
With the given World and Indian economic situation, your Bank has excelled the
performance on all parameters. The total business of the Bank reached Rs.2150 crores
showing growth of 19.66% over the previous year. The deposit base has increased by 16.53 %
and advances by 19.03% over the previous year.
It gives me great pleasure in informing you that during the financial year, the Banks
Data Centre has been awarded ISO 27001:2005; which itself proves the excellent
performance of the Data Centre. On this basis, RBI has permitted us to sharing of our data
centre to other UCBs. At present, two banks are having access to our Data Centre on lease
basis which is unique achievement in UCBs.
Also, it is a matter of honour that your Bank has got "Banco Award" from
AVIS PUBLICATION, PUNE under category of the deposit from Rs. 1000 to 1700 Crores as well
as "BEST ANNUAL REPORT" award for the financial year 2012.13 has been
awarded by Nachiket Prakashan, Nagpur for our attractive / remarkable Annual Report
presentation.
Financial Position in Lacs)
| Particulars |
31/03/2013 |
31/03/2014 |
| Members |
49,269 |
53,767 |
| Paid up capital |
2,371.07 |
2,870.92 |
| Total Reserves |
8,580.58 |
9,069.75 |
| Own funds |
10,951.65 |
11,940.67 |
| Deposits |
1,10,069.26 |
1,28,258.93 |
| Loans & Advances |
73,272.34 |
87,221.67 |
| Working Capital |
1,31,434.74 |
1,52,846.65 |
| Gross Profit |
1,428.39 |
1,564.64 |
| Net Profit |
825.53 |
904.24 |
| Per Employee Business |
377.25 |
440.66 |
| Credit Deposit Ratio |
66.57% |
68.01% |
| Capital to Risk Adequacy Ratio (CRAR%) |
11.28% |
10.93% |
DEPOSITS -
The growth in deposit was 16.53% registering the total deposit of Rs.1282.58 crores.
The CASA deposit stood at 20.77% of total deposit as on 31/03/2014. There is
satisfactory/phenomenal growth in savings deposit over the period.
ADVANCES -
The total advances outstanding of Rs.87221.67 lacs, as on date showing the growth of
19.03% over the previous year.
SECTORWISE OUTSTNDINGS OF LOANS & ADVANCES AS ON 31.03.2014
(Rs. in Lacs)
| Purpose of Loan |
No. of Borrowers |
Outstanding |
| Small Scale Industries |
2,499 |
27,959.46 |
| Traders |
1,070 |
11,601.53 |
| Professional & Self employed |
4,956 |
6,915.91 |
| Housing |
1,538 |
9,547.24 |
| Transport |
270 |
665.10 |
| Education |
142 |
138.07 |
| Ceremonies |
128 |
579.34 |
| Household purpose |
2,934 |
3,293.98 |
| Agricultural & Allied Activities |
485 |
3,062.41 |
| Others |
1,595 |
23,458.63 |
| Total |
15,617 |
87,221.67 |
We have succeeded in maintaining the priority sector advances norms, stipulated by RBI.
The total advances under priority sector are Rs.53,861.02 lac, which constitutes 61.75% of
total advances & out of total priority sector advances, Rs. 13941.01 lac
consists of weaker section as 25.88%. The Bank is always ahead in lending to priority
sector and weaker sections.
As a part of Social Responsibility, Bank has contributed towards microfinance by
lending almost to 1200 SHG groups. And we are proud to mention that all these accounts are
regular and performing assets.
INCOME, EXPENDITURE AND PROFIT
| Particulars |
31/03/2013 |
31/03/2014 |
| A] Total Income |
12,541.64 |
14,612.01 |
| 1. Interest Income |
11,895.37 |
13,849.49 |
| 2. Non-Interest Income |
646.27 |
762.52 |
| B] Total Expenditure |
11,716.11 |
13,707.77 |
| 1 Interest Paid |
8,203.45 |
9,800.41 |
| 2. Administration expenses |
1,289.19 |
1,397.79 |
| 3. Other expenses |
1,620.61 |
1,849.17 |
| 4. Provision |
602.86 |
660.40 |
| C] Net Profit |
825.53 |
904.24 |
The Bank has started Gold Loan Scheme in the rural branches for agriculturists and poor
people and the response for this scheme is indeed promising from all these areas.
CAPITAL AND RESERVES -
(A) On 31st March 2014, the share capital of the Bank is Rs.2,870.92 lac, which is
increased by 21.08% over the previous year.
(B) The reserve fund and other reserves position is Rs. 9069.75 lac.
(C) The capital risk adequacy ratio (CRAR) of the Bank, as on 31.03.14 is 10.93% as
against benchmark of 9%.
INVESTMENTS -
As per the RBI guidelines and norms regarding SLR regulations, our Bank has invested
more funds in Govt. Securities and with the help of NDS set-up, Bank has earned profit of
Rs.165.62 lacs by trading Govt, securities in the G-Sec. market. In spite of grim economic
situation, Bank could achieve maximum returns on the securities.
TECHNOLOGY DEVELOPMENT -
As announced in the previous Annual General Meeting and annual report, NPCI has
included our Banks name in the Rupay payment system through which customers of our Bank
as well as other Banks customer can withdraw cash through any Banks ATM all over the
country through 1,66,000 ATMs. At present, Banks 25 ATMs are effectively
functioning. Recently, Bank has provided Debit-cum-ATM card for making merchandise payment
and for the purchase of required goods through the medium of PoS from any mall or
shop or pay Travel Tickets and Hotel Bills, etc.
Banks Mobile Banking facility will be operative very soon and remittance of Merchant
payment, Railway ticket booking, Mobile & DTH charging facilities will be made easier
to customers. I, therefore, request all the Shareholders, Customers to take advantage of
this facility.
KAIJS Bank has launched the RuPay Debit card to make the payment system more effective
and easier. RuPay is the movement launched by the Government of India through NPCI for
keeping transactions costs very low as compared to other international card schemes.
Also it gives me immense pleasure in announcing that RBI has awarded Authorized Dealer
(AD-II) license to your Bank for making Foreign Exchange transactions. Ours is the only
Bank, in Western Maharashtra, securing licence from RBI for making Foreign Exchange
business. By this, the customers can buy or sell foreign currency and other merchandise
transactions of import and export nature.
NPA -
Due to the worse situation of industrial and business, the recovery of advances was
delayed and the NPA portfolio has increased which is systemic risk. We tried our best to
keep NPA less than 1% during the earlier year but due the turbulent situation of industry;
this year NPA position has increased upto 3.46%.
Out of the total credit portfolio of Rs.87,221.67 lacs, the total gross NPA amount is
Rs.5,446.55 lacs. The gross NPA is 6.24% and net NPA is 3.46% as compared to the last year
4.26% & 0.93% resp. The total BDDR of the Bank is Rs. 2,322.51 lacs and of course, we
have provided 100% for overdue interest.
PROFIT APPROPRIATION -
The Bank has earned total income of Rs. 14,612.01 lac and incurred total expenditure of
Rs. 13,047.37 lac, with gross profit of Rs. 1,564.64 lac during this year. After making
necessary provisions of Rs. 660.40 lac, the Bank has declared net profit of Rs. 904.24
lac. The board has recommended the appropriation of net profit as follows for your
necessary approval and sanction.
The total Net Profit is Rs. 904.24 lacs
| Particulars |
Amount |
| Statutory Reserve (Not less than 25%) of Net Profit |
260.00 |
| Contingency Fund (Not less than 10%) of Net Profit |
130.00 |
| Education Fund (Not less than 1%) of Net Profit |
9.04 |
| Dividend (provision 10% subject to approval of Annual Genera Meeting) |
257.00 |
| Staff Bonus & Ex-Gratia Fund |
95.00 |
| Building Fund |
100.00 |
| Investment Fluctuation Reserve |
50.00 |
The remaining balance of Rs. 3.20 lacs is recommended to be transferred to Building
Fund. The Board has recommended dividend of 10% to the Shareholders for your necessary
approval.
RBI INSPECTION -
RBI inspection has been completed for the year ended 31st March 2013 and we are really
thankful to Honble Shri A.K. Bera (CGM), Mrs. Malvika Sinha (CGM), RBI & Mrs.Surekha
Marande and other officials of UBD for their invaluable guidance from time to time.
STATUTORY AUDIT -
Gogate & Company, Chartered Accountants Firm, Pune, being statutory auditors for
the year 201314 under review, have completed the audit. We are thankful for their guidance
and suggestions.
BRANCH EXPANSION & AREA OF OPERATION -
Last year, RBI had permitted to open new branches at Vashi (Navi Mumbai), Ratnagiri,
Panchwati Nashik & Bengaluru (Karnataka) and out of those Vashi (Navi Mumbai),
Ratnagiri, Panchwati Nashik Branches have been made operative and Bengaluru (Karnataka)
branch will be opened by the month of September. As permitted by RBI, our Navnagar, Hubli
branch is shifted to Belgaum.
As an expansion plan for the year 2014-15, RBI has permitted us to open two more
branches at Alas (Tq. Shirol, Dist. Kolhapur) and Nipani (Tq. Chikkodi, Dist. Belgaum),
which will be made operative during this year.
Also I am happy to inform you that permission to extend the area of operation as whole
state of Goa is granted by RBI and branch expansion in this state is expected soon.
The Board has proposed amendments to the bye-laws for seeking permission from RBI to
extend the area of operation in Gujarat State for which your wholehearted support is
expected.
SOCIAL COMMITMENT -
The Bank is committed to social development in the area of operation and accordingly,
we have contributed to the extent of Rs. 3.46 lac by way of donations to the educational,
social and religious institutions.
As a part of Financial Inclusion programme, Bank has contributed towards micro finance
by lending almost to 1200 SHG groups from Rs. 50,000 to Rs.5,00,000/-. I am proud to say
that all these accounts are regular and performing assets. There is no single defaulter.
INSURANCE BUSINESS & FRANKING FACILITY-
Bank has tied up with Bajaj Allianz for General Insurance and LIC of India for Life
Insurance. I appeal to the members to get the benefit of the schemes. Bank has opened
windows of Franking facility for members and customers at Kolhapur and
Ichalkaranji. The PAN card services to our Members & Customers are available
through our all branches. I request you all to take the benefits of all the facilities.
WORKMEN RELATIONSHIP -
It is proud to express to express all the august audiences that relationship of
Management with employees is excellent. You are aware that, Bank has started our own
training center. During this year too, variety of training programmes were organized and
successfully completed for staff of our Bank. Also we had nominated our employees for
external training programmes at VAMNICOM and CAB, RBI, Pune and other similar institutes
at Pune & Mumbai.
RISK MANAGEMENT-
In fact, profitable business can be made after taking reasonable risks. Your Bank
believes that moderate risk needs to be taken to enhance the profitability. In addition to
have better insight, sharpen the skills and to manage risks, your Bank strikes a tradeoff
between profit and risk. Your Bank has established well set proactive systems of Asset
Liability Management, NPA Management to identify measure and monitor the credit profile of
the Bank. Risk Management Committee, Credit Policy Committee, ALCO Committee etc. are the
committees which handle the risk management aspects of your Bank.
BOARD OF DIRECTORS -
I am extremely happy to express my gratitude to the Board of Directors who helped me in
augmenting the performance of the Bank at all the time.
OBITUARY -
We condole the sad demise of employees and members who have left for their heavenly
abode during last year. The Board gratefully acknowledges the profound contribution and
perseverance with which they worked for your Bank for several years.
ACKNOWLEDGEMENT -
The Board of Directors acknowledges with deep gratitude the valuable and timely advice,
guidance and support received from Reserve Bank of India, (Urban Banks Department),
Registrars of Cooperative Societies, Central Registrar and RCS, Maharashtra and Karnataka.
Small Industries Development Bank of India, NABARD and other Private Sector Banks, Textile
Commissioners, etc.
I am thankful to all the member Banks of the Zilha Nagari Sahakari Banks Association
Ltd., Kolhapur, Solapur, Pune, Satara, Aurangabad for their kind support.
The National Federation of Urban Co-operative Banks and Credit Societies Ltd., (NAFCUB)
is an Apex Body centered at New Delhi, helping for the common cause of Co-operative Banks
and Societies. I am really happy to state that I have been elected as a Director of the
Society from the Western Maharashtra for helping the entire community of Co-operative
Banks.
Because of strong support of Urban Co-operative Banks in the country and wholehearted
support from the Board of Directors, I am representing entire communities of UCBs as a
Director on the Board of NAFCUB. I assure all the stakeholders that I will actively
participate and ensure that the objective of promoting and strengthening the co-operative
movement is taken forward.
it is always a overwhelming support of our founder Chairman Shri. Kallappanna Awade
Ex.M.P. & Shri.Prakash Awade Ex.Minister of Textiles, Govt, of Maharastra. We are very
much thankful to Mr.H.K.Patil, Minister of Karnataka State, who extended wholehearted
support in Karnataka, Maharashtra & New Delhi, in extension of area of operation.
I am thankful to Mr. Babasaheb Patil, Vice Chairman, CEO, Mr. P.T. Kumbhar and the
Board of Directors for their unstinted support throughout the year. My thanks goes to all
the Executives and employees who are the force to drive the Institute with greater pace.
The Board places on record its deep appreciation of the sincere efforts of all the
members of the staff at all levels for excelling in their performance. We also want to
place on record our sincere appreciation of the staff who have contributed for the
development of your Bank for many years and retired from services during the last year.
The Board looks forward to their continued and active cooperation and further involvement
for customer satisfaction. The board also acknowledges with deep gratitude for the
confidence reposed on us, by the shareholders, valued customers and well-wishers of the
Bank.
Ichalka ranji.
Date : 1 August 2014
For Kallappanna Awade
Ichalkarnaji Janata Sah. Bank Ltd.,
Shri. Ashok B. Soundattikar
Chairman
+91-9892691696
