state bank of travancoremerged Directors report

DIRECTOR

Report of the Board of Directors to the State Bank of India, the Reserve Bank of India and the Central Government in terms of Section 43(1) of State Bank of India (Subsidiary Banks) Act, 1959.

Period covered by the Report: 1st April, 2013 to 31st March, 2014

1. MANAGEMENT DISCUSSIONS & ANALYSIS

1.1 Global Economy

Global growth is likely to be in the vicinity of 3 per cent in 2014-15, about a percentage point higher than in 2013-14. The expansion in global output is expected to be led by Advanced Economies (AEs), especially the US. However, downside risks to growth trajectory arise from ongoing tapering of Quantitative Easing (QE) in the US, continuing de_ation concerns and weak balance sheets in the euro area and inflationary pressures in the Emerging Market and Developing Economies (EMDEs). Weakening growth and financial fragilities in China that have arisen from rapid credit growth in recent years also pose a large risk to global trade and growth.

Global inflation remains benign with activity levels staying below potential in the Advanced Economies as well as in some of the large emerging market and developing economies and a softer bias for global commodity prices continuing into 2014.

The global financial markets have weathered the initial dose of actual tapering of the Quantitative Easing (QE) by the US Fed, quite well. However, the global interest rate cycle has just begun to turn. Any large withdrawal of monetary accommodation by advanced economies and consequent effect on capital flows to and from Emerging Market and Developing Economies (EMDEs) could lead to volatility and could translate into liquidity shocks impacting asset prices.

1.2 National Economy

GDP growth has been stagnant at around 5% during the year. This is attributable to the continued weakness in industrial activity and supply side constraints.

A moderate recovery is likely to set in 2014-15 broadly in line with the Reserve Bank’s indicated projections in January 2014. The recovery is likely to be supported by investment activity picking up due to part resolution of stalled projects and improved business and consumer confidence. Manufacturing PMI, for the month of February 2014, touched a year’s high on the back of higher output and new orders. The rural demand base is likely to shore up demand, following record agricultural output.

While the global environment remains challenging, policy action in India has rebuilt bu_ers to cushion it against possible spill overs. There was curtailment of deficit (both Current & Fiscal). There was also adjustment of rupee exchange rate and replenishment of foreign exchange reserve which resulted in lowering of risk of near-term macro instability. However, more efforts in terms of removing structural impediments, building business confidence and creating fiscal space to support investments will be needed to secure growth.

1.3 Kerala Economy

Kerala’s economy is one of the fastest growing economies in the country. Kerala has won international recognition for its outstanding achievements in Health and Education sectors. The prime driver of the economy still is the remittance from abroad by 22 lakhs Non- Resident Indians, mainly from Gulf Countries. Economy in Kerala is supported by traditional industries. Coir, Cashew, Bricks and Tiles, Oil Milling, Handloom and Timber employ 83% of the total work force in the industrial sector.

Kerala contributes 97% of national pepper production and accounts for 85% of the area under natural rubber cultivation in the country. Coconut, tea, coffee, cashew, and spices — including cardamom, vanilla, cinnamon, and nutmeg — form a major part of the agricultural sector. In addition to this, rice is extensively grown in Kerala. Nevertheless, home gardens comprise a significant portion of the agricultural sector.

Tourism continues to flourish and plays an important role in the State’s economy. IT sector is on a growth path with flagship Techno Park at Thiruvananthapuram and Techno City at Ernakulam gaining further momentum. The proposed Info Park and Smart City near Kochi, are expected to propel Kerala to become one of the leading IT destinations in the country. Mega Projects like Vallarpadam International Container Trans-shipment Terminal will give a fillip to the economy. The proposed Vizhinjam International Deepwater Multipurpose Seaport at Thiruvananthapuram is expected to give boast to the State’s economy. The Kannur International Airport project is expected to transform the North Malabar region into a highly developed Centre for Travel, Tourism and Industries.

1.4 Banking Environment

The resilience and stability of the domestic financial system have become essential to the country’s macroeconomic stability, particularly in an increasingly integrated world. Indian Banking sector demonstrated strong resilience during the global financial crisis and was able to maintain stability. In India, reforms have continued with a view to building a robust and resilient financial system. More stringent capital and liquidity measures for Commercial Banks have been implemented and steps have been taken to build up Capital Conservation Bu_ers (CCB). RBI has initiated the steps for implementation of the Basel III norms embedded with provisions and guidelines for higher capital adequacy. The key focus areas for Indian Banks include, liquidity management; gainful deployment of funds; availability of cheaper technology to serve thinly populated unbanked areas; grooming suitable replacement for large number of experienced manpower due for retirement; IT security; advanced Risk Management approaches; and introduction of innovative products. The Indian Banking sector is continuing to grow with rapid transformation, with almost all the Banks having migrated to Centralised Core Banking Environment, supported by technology enabled products viz. mobile banking, net banking and smart cards.

1.5 ASCB Performance

All Scheduled Commercial Banks Deposits grew by Rs 9,87,970 crore (14.63%) between 22nd March, 2013 and 21st March, 2014 to reach a level of Rs 77,39,390 crore as on 21st March, 2014. The Gross Advances grew by Rs 7,50,260 crore (14.25%) in the same period to touch a level of Rs 60,13,090 crore. Food credit increased by 2.13% to touch Rs 98,480 crore. Non Food credit grew by 14.48% and reached the level of Rs 59,14,610 crore.

1.6 Regulatory Measures and Monetary Policy

The year 2013-14 witnessed a series of monetary measures initiated by Reserve Bank of India to contain rising inflation and arresting the weakening of rupee. Further, liberalisation in the Branch Authorisation Policy and adoption of more stringent security measures for electronic payment system were announced. The Reserve Bank of India granted "in-principle" Bank license to Infrastructure Development Finance Co and Bandhan Financial Services Ltd.

Some of the main policy changes and reforms announced by RBI during the year were as under:

• Repo rate moved from 7.5% to 8%.

• Cash Reserve Ratio (CRR) of Scheduled Commercial Banks maintained at 4.0 per cent of Net Demand and Time Liability (NDTL).

• Increased liquidity provided under 7-day and 14-day term repos.

• The reverse repo rate moved in tandem with repo rate and is presently at 7.0 per cent.

• The Marginal Standing Facility (MSF) rate and the Bank Rate are presently at 9.0 per cent.

• Under the new RBI Branch Authorisation Policy, Banks can now open branches without taking prior permission from RBI, subject to reporting. To provide enhanced banking services in Tier 5 and 6 centres (Rural), domestic Scheduled Commercial Banks should necessarily open 25% of the branches, in unbanked rural centers.

• RBI has stipulated higher provisioning norms on Restructured Assets.

2. The Bank’s Operations and Performance

2.1 Total Business

The Bank’s gross business crossed Rupees One Lakh Sixty

Thousand crore during FY 13 – 14. The total business of the Bank reached the level of Rs 1,60,119 crore as on 31st March, 2014, from

Rs 1,52,108 crore as on 31st March, 2013 showing a growth of 5.27%.

It comprises of a total deposit of Rs 89,337 crore and Gross Advances of Rs 70,782 crore.

2.2 Working Results and Operating Profit

Operating profit (after Staff Provisions) for the year ended 31st March, 2014 stood at Rs 1,369.69 crore as compared to Rs 1,351.00 crore recorded for the year ended 31st March, 2013. Net Profit for the year stood at Rs 304.34 crore as compared to Rs 615.04 crore for FY 2012–13, showing a decline of 50.52%.

The earnings per share (face value of Rs 10) was Rs 60.87 as on 31.03.2014 as against Rs 123.01 as on 31.03.2013.

The Net Interest Income increased by 11.98% from Rs 2,128.20 crore in FY 2012-13 to Rs 2,383.15 crore in FY 13 -14. Net interest Margin (NIM) stood at 2.43% as on 31.03.2014.

2.3 Dividend

The Bank declared a dividend of Rs 2.50 per share (25%) for FY 2013-14, entailing a total payout of Rs 12.50 crore. The dividend payout Ratio works out to 4.11% of the Net Profit.

2.4 Capital Adequacy

The Capital Adequacy ratio under Basel II stood at 11.52% as on March 31st, 2014 as compared to 11.70% as on March 31st, 2013, against a minimum of 9% stipulated by RBI. Under Basel III, the Bank’s capital fund improved from Rs 5,671.43 crore as on 1st April, 2013 to Rs 6,357.63 crore as on 31st March, 2014. This also includes, an amount of Rs 385 crore received from State Bank of India towards preferential allotment of Equity shares, pending allotment. The Capital Adequacy Ratio under Basel III improved from 10.74% as on 1st April, 2013 to 10.79% as on 31st March, 2014.

2.5 Deposits

Bank’s Aggregate Deposits showed a growth of 5.54% and stood at Rs 88,707 crore as on 31st March, 2014 compared to Rs 84,047 crore in the previous year. The Personal Segment Deposits recorded an impressive growth of Rs 9,656 crore (18.36%) during the year, to reach a level of Rs 62,247 crore, which constituted 70.17% of Aggregate Deposits.

NRI Deposits also recorded an impressive growth of Rs 5,651 crore (29.26%) during the year, to reach a level of Rs 24,963 crore. It constitutes 28.14% of the Aggregate Deposits of the Bank as on 31st March, 2014.

Total Deposits of the Bank (including Inter Bank Deposits) stood at Rs 89,337 crore as on 31st March, 2014 as against Rs 84,624 crore as on 31st March, 2013.

2.6 Advances

The Gross Advances of the Bank stood at Rs 70,782 crore as at the end of 31st March, 2014 as against Rs 68,389 crore a year ago, registering a growth of 3.50%. Personal segment advances grew by Rs 374 crore and reached a level of Rs 18,294 crore, whereas the C&I segment declined by Rs 311 crore and reached a level of Rs 34,901 crore.

The Retail lending stood at Rs 35,881 crore and constituted 50.69% of the Gross Advances as at the end of 31st March, 2014. .

The Credit Deposit Ratio of the Bank as on 31st March, 2014 was 79.23% as against 79.75% a year ago.

2.7 Market Share

The Bank’s market share in ASCB Deposits was 1.16% as on 21st March, 2014 as compared to 1.22% as on 22nd March, 2013. The market share in Advances has come down from 1.25% as on 22nd March, 2013 to 1.16% as on 21st March, 2014. The Bank’s All India Market share in total business as on 21st March, 2014 stood at 1.16%. (Source: RBI).

The Bank continued to maintain its position as the premier Bank in Kerala, with a market share of 21.32% in business among all Commercial Banks ( as at the end of December 2013) with a 14.06% share of the total branch network. In respect of NRI deposits, our market share in the State was 24.24%. (Source SLBC, KERALA)

2.8 Priority Sector Lending

The Bank continued to give special emphasis on lending to the priority sector in conformity with national policies, expectations and fulfillment of social objectives. Bank’s Gross Advances to the Priority sector increased from Rs 24,378 crore as at the end of March 2013 to Rs 29,179 crore as at the end of March 2014 and constituted 42.26% of the Adjusted Net Bank Credit (ANBC), against the benchmark of 40%.

2.9 Agricultural Finance

The Bank disbursed an amount of Rs 10,408 crore under Agriculture segment as at the end of March 2014 against the Special Agricultural Credit Plan target of Rs 7,200 crore. Agriculture segment showed a growth of Rs 1,137 crore during the financial year 2013-14. Exposure to Agriculture segment reached a level of Rs 13,212 crore as on 31st March, 2014, which is 19.13% of ANBC, against a benchmark of 18%.

Haritha Campaign

The Bank conducted an intensive Agriculture lending campaign covering all agriculture loan products, called "HARITHA CAMPAIGN" during the financial year 13 – 14.

Farmer Clubs

Farmer Clubs meetings were conducted at various centre’s to give wide publicity to the schemes available to farmers. Meetings were also conducted on the occasion of Farmer’s Day.

2.10 Lending to Micro, Small and Medium Enterprises (MSMEs)

MSMEs play a major role in the country’s economic development. The Bank gives due importance for the growth of this vital segment of the economy. Total lending to MSME sector as on 31st March, 2014 stood at Rs 11,460.54 crore, registering a growth of Rs 2,230.31 crore over the previous year. The lending to Micro and Small Enterprises (MSEs) stood at Rs 7,774.10 crore which is 37.37% higher over the previous year level.

The growth in this sector was fuelled by an intensive MSME lending campaign conducted from 1st September, 2013 to 31st December, 2013. The total loan disbursement during the Campaign period was Rs 677 crore covering 3,699 accounts.

MSME segment achieved all the three RBI Bench marks i.e.

i) The year on year growth to Micro and Small Enterprises was 37.37% as against the bench mark of 20%.

ii) The increase in number of Micro accounts was 84.58% as against the bench mark of 10%.

iii) Lending to Micro enterprises under MSE segment was 60.01% as against the bench mark of 60%.

The Bank was conferred with the National Award for excellence in lending to Micro Enterprises based on credible performance in lending to MSMEs during the year 2012- 13. The Bank has been receiving this award in succession for the second year and for the fifth time since institution of the award i.e. from the year 2005-2006.

RTO – Tie up arrangement

Road Transport Operators (RTO) is an important sub segment under service segment. The relaxation in security norms, reduction in interest rate and Tie up with automobile companies, contributed to the steady growth under this vital segment. Outstanding under RTO segment as on 31st March, 2014 was Rs 362.39 crore comprising of 10,096 accounts.

Prime Minister’s Employment Generation Programme (PMEGP)

The Bank actively supported the programme to generate employment for youth and stood first in the State of Kerala surpassing the targets. The Bank financed 334 projects during FY 13-14, against the target of 193 projects, registering an achievement of 173%. The total outstanding under PMEGP scheme was Rs 64.04 crore.

CREDIT GUARANTEE FUND TRUST FOR MICRO AND SMALL ENTERPRISES (CGTMSE)

The Bank is a Member Lending Institution of CGTMSE which provides guarantee cover to collateral free loans. Bank made it mandatory to cover all eligible accounts up to a limit of Rs 50 lacs under CGTMSE. The Bank extended finance under this scheme to 15,699 borrowers with a total outlay of Rs 679.28 crore upto FY 2013 – 14.

Specialised MSME Branches:

Bank opened three specialised MSME Branches at Kollam, Kozhikode and Palakkad during the financial year, taking the total number of specialized MSME branches to eight.

Lending to Women Entrepreneurs

Bank actively supported / encouraged lending to women entrepreneurs. Total lending to women entrepreneurs stood at Rs 8,625.32 crore covering 7,69,851 borrowers. The exposure constitutes 12.49 % of ANBC.

2.11 Commercial & Institutional Finance

The Bank’s performance under this Segment reached a level of Rs 34,901 crore as on 31st March, 2014. This segment contributed 49.31% of Bank’s total advance,

Commercial Network (CNW) Branch System was introduced in the Bank for giving focused attention to select branches to achieve substantial growth in large value advances. Commercial branches at Bangalore, Chennai, Ernakulam and New Delhi, Corporate Finance Branch Mumbai, Mumbai Main and Karol Bagh Branch (New Delhi) were brought under the system. The 7 CNW branches put together have a business level of Rs 27,015 crore. CNW Branches’ Credit portfolio was Rs 21,225 crore, which is about 30% of the Bank’s total advances.

With the objective of improving the market share in Corporate segment and enhancing the business mix, Bank established a separate network called "Commercial Business Network" (CBNW).

The core idea behind the formation of CBNW is to cater to the banking needs of Mid Corporates, emerging Business Groups and large SMEs which contribute to the Bank’s asset portfolio. Now, CBNW has in its fold, 13 branches across the country and it is proposed to add more branches during 2014-15.

CBNW Branches, being credit focused, have great potential to contribute towards the growth of business. At the end of 2013-14, the total business of CBNW was Rs 10,498 crore, with deposits at Rs 3,134 crore and advances at Rs 7,364 crore. CBNW branches contributed 10.40% of the Bank’s total advances.

Project Finance Unit (PFU) was formed in the Bank in order to develop project appraisal skills in-house and also to prevent good business proposals from going past us for want of Techno-economic viability (TEV) study. PFU facilitates Technical and Financial appraisal of Large, Medium and Small sized projects, which have not been vetted by agencies of national/ international repute. During the year, PFU received 30 proposals from various branches. 5 proposals with an aggregate limit of Rs 172.00 crore were sanctioned.

2.12 Personal Deposits

Deposits under Personal Segment grew from Rs 52,590.92 crore as on 31.03.2013 to Rs 62,246.92 crore as on 31.03.2014 thus recording a growth of 18.36%. Domestic Deposits grew by Rs 4,004.55 crore while NRI deposits grew by Rs 5,651.45 crore. Personal Deposits constitute 70.17% of the aggregate Deposits of the Bank.

2.13 Personal Finance

The Bank continued to be active in extending Personal Segment finance, mainly by way of Housing Loans, Car Loans, Education Loans and Gold Loans. 13,785 housing loans aggregating Rs 2,029.21 crore were sanctioned during FY 13-14. Outstanding in Housing Loan stood at Rs 9,500.75 crore as on 31.03.2014.

Similarly, 10,455 Vehicle loans aggregating Rs 517.60 crore were sanctioned during FY 13-14. Outstanding in Vehicle loan stood at Rs 1,387.86 crore as on 31.03.2014

The Bank continued to support the younger generation to pursue higher studies by extending Education Loans under IBA Model Scheme. The Bank maintained its leadership in extending Education Loans in the State of Kerala. In FY 13-14, 6794 Education Loans amounting to Rs 217.76 crore were sanctioned, taking the total outstanding amount to Rs 2,475.41crore as at the end of March 2014.

Social Banking

In conformity with the Government of India guidelines, Interest Subvention benefits were passed on to the eligible borrowers under Housing loans and education loans schemes.

2.14 Treasury Operations

The Gross Investments of the Bank stood at Rs 28,035 crore as on 31st March, 2014 as against Rs 27,273 crore as on 31st March, 2013. Average investments during 2013-14 were Rs 29,938 crore as against Rs 24,984 crore during 2012-13. The Revenue from investment operations (interest and dividend) for the year was Rs 2,211.92 crore as against Rs 1,816.37 crore for the previous year. The average yield on investments was 7.44 % during the year as compared to 7.38% as on 31st March, 2013.

The Bank earned a profit of Rs 190.52 crore from Domestic Treasury Operations during FY 2013-14 compared to Rs 131.18 crore during FY 2012-13. The total profit from Forex operations during the year was Rs 80.91 crore as against Rs 25.29 crore as on 31st March, 2013. Bank’s total Forex turnover during the year for merchant transactions was Rs 26,973 crore compared to Rs 24,026 crore during the previous year. Interbank turnover during the year was at Rs 6,13,203 crore as against Rs 4,83,332 crore during the previous year. The Bank is a member in MCX-SX (Multi Commodity Exchange) for trading in Currency Futures.

2.15 International Banking

The total profit from Forex operations during the year was Rs 80.91 crore as against Rs 25.29 crore as on 31st March, 2013. The export finance extended by the Bank reached a level of Rs 2,397.69 crore, recording a growth of 16.15 % YoY.

The Bank has entered into an agreement with Export Credit Guarantee Corporation of India (ECGC) to cover its export credit portfolio. Accordingly, eligible accounts were covered under Whole Turnover Packing Credit Guarantee (WTPCG) and Whole Turnover Post Shipment Guarantee (WTPSG).

With a view to speeding up, issuing of Bank Realisation Certificate (issued to exporters) for claiming export incentives and as part of message exchange initiative of Directorate General of Foreign Trade (DGFT), the Bank has commenced digital transmission of Bank Realisation Certificate (e-BRCs) through DGFT website.

2.16 Cross Selling

The Bank has been constantly endeavoring to meet the financial requirements of its customers by making available Life, Non-life insurance products as well as other non-banking products like Mutual Funds and Credit Card. These products are dispensed through SBI Life Insurance Company, SBI General Insurance Company, SBI Mutual Fund and SBI Cards companies.

The Bank earned an amount of Rs 11.15 crore from cross selling business in FY 13 – 14 as against Rs 9.87 crore during FY 12 – 13, thereby recording a YoY growth of 13%

Under Bancassurance, as part of financial inclusion, around 2,500 lives of rural poor was covered under micro insurance schemes of SBI Life.

2.17 Asset Quality

The Bank continued to give, in a very dynamic manner, special focus to improve the quality of Assets and to ensure building up of well performing loan portfolio. The Gross NPA level of the Bank as on 31st March, 2014 stood at Rs 3,077 crore. The percentage of Gross NPA to Gross Advance stood at 4.35% compared to 2.56% as on 31st March, 2013. The Net NPA level of the Bank as on 31st March, 2014 stood at Rs 1,929 crore. The percentage of Net NPA was 2.78% in FY 2013 – 14, compared to 1.46% as at the end of the previous year.

A well built monitoring mechanism for recovery has been placed by constituting a Board level Committee, besides a High Power Task Force with Top Executives as members, to review the Non Performing Assets and build momentum for recovery. As a strategic initiative, a new cell has been formed to exclusively monitor recovery performance under loss assets.

The Asset Tracking System has been centralized and put in place effectively, for follow up of irregular accounts by tele-calling. During the year 1,40,005 accounts were tracked and 54,200 accounts were regularized with a recovery of Rs 63.82 crore.

The Bank is continuously engaged in providing the right kind of rehabilitation package to sick units to ensure revival of potentially viable sick industrial units. Rehabilitation / Restructuring packages are under implementation in respect of 22 units with a total exposure of Rs 1,569 crore, of which 20 units are under CDR scheme with an exposure of Rs 1,512 crore and 2 units under BIFR scheme with exposure of Rs 57 crore.

2.18 Government Business

The Bank maintains its status as the Principal Banker to Government of Kerala. The Bank has been authorized by Reserve Bank of India to handle State Government Business at 132 branches in the State of Kerala and 1 branch in Tamil Nadu. 415 Post Offices are linked with the branches, with a total turnover of Rs 5,139 crore. Bank is also undertaking Railway transactions in its 33 branches.

194 branches of the Bank are authorized by CBDT for collection of Direct Taxes by physical mode (134 branches in Kerala and 60 branches outside Kerala) and 148 branches are authorized by CBEC in Kerala for Indirect Taxes in physical mode. All branches are authorized for e-payment of Direct and Indirect Taxes.

State Bank of Travancore is a Banking partner of the Government of Kerala in the e-tender / e-procurement project. E-payment facility launched by the Government of Kerala, through the Bank for the payment of Commercial Taxes is well received by the business community and the Bank recorded a Turnover of Rs 11,847 crore for FY 13 – 14. E-payment of Kerala State Excise License Fee, Rent, Vehicle Tax, Duty, collection of petty case penalties and import fee are enabled through SBT Online.

Other e-payment initiatives include collection of Karnataka State Government Taxes, Commercial Tax and Sales Tax of Tamil Nadu, Professional Tax and Sales Tax payment of Maharashtra State Government. Bank also started collection of property tax online in selected Corporations, Municipalities and Panchayaths in the state of Kerala.

The Centralised Pension Processing Cell (CPPC) has become fully operational with 1,45,018 pensioners and generated an income of Rs 11.19 crore during 2013-14.

The Bank is having 114 currency chest branches in Kerala, 1 in Kar-nataka and 8 in Tamil Nadu. In FY 13 – 14, the Bank earned Commission to the tune of Rs 58.15 crore by conducting Government business.

2.19 Electronic Payment Systems

Electronic Payments of the Bank are done by the Payment and Settlement Group which functions from Belapur, Navi Mumbai. All the branches of the Bank are enabled for RTGS/GRPT/NEFT remittances. The total number of outward electronic remittances for the year ended 31.03.2014 was 63,74,055 registering an increase of 32%, over the previous year. While the number of transactions under RTGS recorded a growth of 14%, GRPT outward transactions and NEFT transactions increased by 50% in the current year. RTGS application was moved over to an upgraded versions complying with ISO 20022 messaging protocol with effect from October 2013. In order to improve customer service, one more settlement batch was started for NEFT transactions at 8.00 AM during the year.

3. Marketing Initiatives and Development of New Products

The Bank continues to play its role in facilitating customer acquisition, retention and broadening of customer base by conducting segment centric marketing drives.

3.1 The salary payments of most of the State Government Departments are now disbursed through the Bank. Corporate Salary Package, with attractive features, was rolled out to cater to the needs of the employees.

3.2 The Bank is the preferred Bank for almost all State Government Departments.

3.3 The Bank continues to be the main Banker to all the Universities in the State of Kerala and has branches in their campus.

3.4 The major achievement during FY 13 – 14 was the arrangement for payment of salary and pension for 80,000 KSRTC employees.

3.5 In order to provide one-stop service to customers, the Bank introduced a 3-in-1 account for securities transactions. In this regard, Tie-up arrangement with SBICAP Securities Ltd. (SSL) was put in place to enable the customers for opening of Demat and Trading accounts.

3.6 The State Lottery collection account to pool the funds of each District Lottery Officers (DLOs) was rolled out.

3.7 A concept of "Mega Locker" was floated. The same was rolled out at Kuravankonam branch as a pilot project.

3.8 Bank has tie-up arrangement with Maruthi Suzuki which facilitated sourcing of car loans.

4. Customer Service

Customer service is accorded top priority in the Bank and every endeavour is made to improve the quality of service to the customers and redress their grievances expeditiously.

A well defined and full- fledged Customer Grievances Redressal Mechanism is put in place in the Bank. An official of the rank of Deputy General Manager is placed as head of the Customer Service Department to give greater focus on redressal of complaints.

Bank has provided a facility (SMS SBT CARE) to the customers whereby they can send a message from anywhere by SMS to 56363 or give a missed call to 9847198471 from their mobile. The customer is contacted by the officials of the Bank and the complaints are taken up for redressal on priority.

Bank has also established a call centre with toll free number: 1800 425 5566 which enables the customers and general public to seek clarification on Bank’s products and services.

5. NRI Services

The NRI deposits recorded a growth of Rs 5,651 crore during the year and achieved a level of Rs 24,963 crore. Bank continues to maintain the First position among Banks in the Kerala State in NRI deposits. Bank enjoys a market share of 41.50% among the Public Sector Banks in the State.

5.1 The NRI deposits constitute 28% of Bank’s total deposits. In order to provide personalized service to the NRI Customers, Bank has opened NRI specialized Branches at Mumbai, Kottayam and Kollam during the current year, taking the total of specialized NRI branches to eleven. 5.2 Two more Relationship Managers have been deputed to the Gulf countries during the year to strengthen Bank’s international presence, taking the total number of Relationship Managers posted abroad to nine. Tie up arrangements were established with five more Exchange Houses in the Gulf countries during the year, taking the total number of such arrangements to 43. These Exchange Houses remitted Rs 38,000 crore to the State which was 50% of total remittance received by the State of Kerala in FY 13 – 14. 5.3 A new Current Account product, " SUKOON" was introduced exclusively for NRIs who wish to keep their savings, free of the interest, on account of their religious beliefs. The Rupee premium Deposit Account, was made available for longer periods – exceeding one year. A new foreign currency loan product against the FCNR (B) deposits was introduced during the year. The facility to open NRE accounts online was also introduced during the year.

6. Lead Bank Scheme

The Bank is undertaking the Lead Bank activities in three districts of Kerala -. Alappuzha, Kottayam and Pathanamthitta. TheLeadBanksinitiatedseveralstepsforsuccessfulimplementation of DBT/DBTL in these Lead Districts. Financial Literacy programmes for Students, farmers and women entrepreneurs were also arranged in the lead districts. A Special Campaign was conducted on Priority Sector Advances particularly for extending Kisan Credit Cards. For widening the coverage of Banking services, a campaign for opening of Savings Bank accounts was conducted in the Lead Districts.

6.1 Rural Self-Employment Training Institutes (RSETIs)

Bank has RSETIs in Wayanad, Pathanamthitta, Alappuzha, and Kottayam for providing skill up-gradation trainings to the rural youth with focus on Below the Poverty Line (BPL) category. The courses for which training is imparted include - beautician course, ornaments manufacturing, mobile phone servicing & repairing, aluminum fabrication, tailoring, textile ornamentation, kitchen gardening, mushroom cultivation, Dairy farming, Vermi Compost and off-site programmes like rubber tapping, driving. RSETIs also imparted EDP training to bene_ciaries selected under Kerala State Entrepreneurs Development Mission (KSSEDM).

7. Financial Inclusion

7.1 Financial Inclusion (FI) is delivery of banking services at an a_ordable cost to the vast sections of the disadvantaged and low-income groups. The Bank opened 25.56 Lac No-frills accounts (Janapriya accounts). 90% of these accounts were opened in the State of Kerala. Joint Liability Group (JLG) schemes, Biometric Smart Card Project, General Credit Cards to the Janapriya Account Holders are other initiatives in this direction.

7.2 In conformity with the directions of Reserve Bank of India, the Bank has formulated a Financial Inclusion Plan, which has been rolled out during 2013-14 and all FI villages allotted to the Bank has been covered in the State of Kerala.

7.3 The following steps / activities were undertaken by the Bank as a part of fulfilling the Bank’s commitment to Financial Inclusion.

• 35 villages having a population over 2000 have been allotted to the Bank for providing basic Banking services through Business Facilitator/ Business Correspondents (BF / BC) route or by opening branches. Bank provided Basic Banking services in these villages through the BF/BC route except in Perumanna, Mayyil, Vadavannur, Eramallor, Kumarampathoor, Chethakkal, and Thelliyoor villages in Kerala, where new branches were opened.

• All the BCs/CSPs and Link Branch Managers have been imparted training.

• The FI Project of the bank has been christened "SBT-SAHAYA HASTHAM".

• As on 31st March, 2014, Bank enrolled approximately 27,500 customers under "SAHAYA HASTHAM" in the 35 FI Villages. The Bank has added 20,209 No-Frills accounts through the new branches opened at Perumanna, Mayyil, Vadavannur, Eramallor, Kumarampathur and Chethakal villages.

• Smart Cards were issued to 25,160 customers.

7.4 The Bank has been allotted 365 Sub Service Area (SSAs) by SLBC Kerala for opening of Banking outlets. The Bank opened Banking outlets in all these centres through Akshaya Mission of Kerala, a partner of CSC e- Governance services India Ltd. The Bank started Kiosk Banking through Akshaya Centres.

7.5 As a member of the Aadhaar Payments Bridge System (APBS) and National Automated Clearing House (NACH) of the National Payments Corporation of India (NPCI), Bank processed 35,13,357 records through NACH amounting Rs 217,39,86,410 and 1,04,336 records amounting Rs 22,67,04,863 under Central Plan Scheme Monitoring System (CPSMS) during FY 2013-14. Both these channels are meant for payment of Government Direct Benefits Transfer (DBT) to the bene_ciaries.

7.6 The Bank has seeded / linked approximately 19.74 lac customers’ accounts with Aadhaar numbers as on 31st March, 2014.

7.7 The Bank has got Lead Bank responsibility in three Districts in Kerala - Alappuzha, Kottayam and Pathanamthitta.

7.8 CRISIL conducted a study called "CRISIL Inclusix" which is an index to measure the progress in Financial Inclusion.

As per "CRISIL Inclusix", Pathanamthitta district was ranked Number one in the country. The other two Districts i.e., Kottayam and Alappuzha were ranked fifth and _fteenth in the CRISIL Study.

8. Support to Weaker Sections

8.1 Assistance to Schedule Caste / Schedule Tribes ( SC/ST )

The Bank continues to give due importance in extending financial assistance to meet the credit requirements of the SC/ST customers. A credit Cell is functioning at Head Office under the control of Deputy General Manager (MSME) for monitoring flow of credit to SC/ST. Advances to SC and ST borrowers under Priority sector aggregated to Rs 4,038 crore constituting 13.84% of priority sector lending .

8.2 Assistance to Minority Communities (MC)

The Bank continues to give due importance in extending financial assistance to meet the credit requirements of the Minority Community borrowers. Advances to Minority Community borrowers under Priority sector stood at Rs 9,692 crore as on 31.03.14, as against Rs 8,536 crore as on 31.03.2013, constituting 33.21% of the Bank’s priority sector lending.

8.3 Lending to women entrepreneurs

The Bank actively encouraged lending to women entrepreneurs. Total lending to women entrepreneurs stood at Rs 8,625.32 crore covering 7,69,851 borrowers. The exposure constitutes 12.49% of ANBC.

9. Information Technology-Technology Up-gradation and IT initiatives

The Core Banking System has provided the Bank with a state-of-the-art software that has greatly enhanced the efficiency of customer services, accelerated data processing capabilities, strengthened MIS, enabled efficient Asset Liability Management, reduced transaction cost and offered alternate channels to customers for transactions.

9.1 Alternate Delivery Channels

The CBS has facilitated effective implementation of Alternate Channels viz Automated Teller Machines (ATMs), Internet Banking, Mobile Banking, Green Channel Counters(GCC), Point of Sales terminals (POS), Prepaid cards and Self Service Kiosks(SSK). The Internet Banking facility is recognised to be the best among its class. Mobile Banking Service which was rolled out in July 2009, is getting steady acceptance from customers.

9.2 ATMs

• The Bank has a network of 1352 ATMs.

• The Bank’s ATM cum Debit cards are accepted in all outlets having Master Card / Visa logo. Several facilities such as Visa Money Transfer (VMT), Money Send, SBI Credit Card payment, SBI Life Premium payment, Mobile recharge, Donations, Fee payment, JMET / GATE Application Fee payment, Mobile Banking registration and order for new cheque books have been enabled in the ATMs.

• The Bank has card base of 84.07 lacs as on 31.03.2014, which translates into an increase of 21.11% over the card base as at the end of the previous year.

9.3 Internet Banking

• The Bank’s highly secure Internet Banking, supported by encryption, offers utmost security to Internet Banking customers against phishing / hacking threats and provides Intra-Bank / Inter-Bank funds transfer facility up to a limit of Rs 500 crore per transaction.

• 1,55,527 new registrations were activated during the FY 13 – 14, showing a growth of 27.71% over previous year. Total number of Internet Banking registrations as on 31.03.2014 was 7,16,699, comprising of 6,34,699 Retail Customers and 82,000 Corporate Clients.

9.4 Mobile Banking

• Mobile Banking provides customers with another safe, secure, fast and convenient channel for banking transactions. The services provided includes enquiry services, funds transfer, Interbank Mobile Payment system (IMPS), Demat account services, bill payment, mobile top-up, DTH recharge, M-commerce. The daily limit for MBS transaction is Rs 50,000/- for aggregate of funds transfer & transactions involving purchase of goods & services, within an overall calendar month limit of Rs 2,50,000/-.

• A more advanced fund transfer channel, P2A, was added to the existing IMPS payment services enhancing the ease and convenience of the Mobile Banking facility. The new channel provides 24x7 instant-payment facility to any IMPS Member Bank.

• The Bank has a net Mobile Banking base of above 1,60,000 customers. The net income earned during 2013-14 through mobile banking was Rs 10.25 lacs with a YoY growth of 34.06%.

9.5 Other achievements

The Bank is the pioneer in various e-banking initiatives. The major initiatives in FY 13-14 are given below:

• The Government of Kerala won the CSI-Nihilent E-Governance Award for 2012-13. The sole banking service provider in this project was State Bank of Travancore.

• Arrangement for payment of salary and pension to 80,000 KSRTC employees.

• Cheque Truncation System (CTS) implemented in all MICR centres across the country.

10. Business Process Re-engineering

(BPR) Initiatives

With the objective of enhancing customer service and improving Bank’s performance, the Bank embarked on implementation of various BPR initiatives by leveraging on its core competencies, state of the art technology and redesigned operating architecture.

• Retail Assets & Small and Medium Enterprises City Credit Centres (RASMECCCs) were established at eight centres linking 189 branches. During the current financial year, the Bank opened another six centres linking 74 branches. Altogether 281 branches are now covered by these centralised credit processing centres. These centres ensure that the loans are delivered within the prescribed turnaround time.

• Multi Product Sales Team (MPST) has been formed at all zonal offices who will act as an intermediary between customers and the loan processing centres. During the current year, the Bank has added five newly recruited staff at each centre thereby making the team younger and more vibrant .

• Currency Administration Cells (CAC) were earlier established at 13 centres linking 199 branches to act as a link between branches and currency chest for better cash management. During the current year, another six centres were added, linking 49 more branches. The overall cash reduction in all branches is more than 50% of their retention limit. In Thiruvananthapuram, the reduction is as high as 78%.

• Stressed Assets Resolution Centres (SARCs) were rolled out at eight centres for more focused attention on recovery of stressed assets. Follow up of pending cases and initiation of SARFAESI proceedings have been given a thrust due to the availability of specialized manpower at these centres .

• Pension processing has been centralized at our Centralised Pension Processing Centre set up at Thiruvananthapuram. 783 branches are linked to these centres and at present 1,44,918 pensioners are receiving their pensions through this centre. The Centre ensures accuracy in pension calculations and timely disbursement of pension.

• In line with the RBI guidelines, the Bank moved over to CTS clearing scenario. Service Branches are functioning at New Delhi, Mumbai & Chennai. Additional Service branches are also established at Bengaluru, Thiruvananthapuram, Kozhi-kode, Thrissur, Kottayam and Kollam for providing support.

• Trade Finance Central Processing Centres (TFCPC), aimed at ensuring efficient and uniform handling of trade finance transactions were rolled out at Ernakulam and Chennai linking 46 branches.

• Liability Central Processing Centre (LCPC) was established at Thiruvananthapuram to provide back office support to branches in opening and servicing of liability accounts such as Savings Bank and Current Deposit Accounts. The Centre provides pre-generated Welcome Kits to the linked branches consisting of ATM cards and cheque books. During the financial year 2013-14, a record 22.50 lac accounts were opened compared to 13.50 lac accounts during the previous year. LCPC also issues CTS compliant cheque Books to customers.

• Contact centre(Toll free No:18004255566) was set up at Bengaluru for providing information on the Bank’s products and services, ATM card issue status and blocking of lost/damaged cards. Lead Management System of the Bank provides a tracking mechanism for business leads generally received through Contact Centres. During the current year, the Bank has extended to the customers, the privilege of calling in five different languages (i.e. English, Hindi, Tamil, Kannada & Malayalam). Customers can now generate T-pin also whereby they can access their accounts directly.

• During the current year, Bank rolled out the "Doorstep Banking" whereby dedicated cash vans go to customers doorsteps and pick up cash. This value added service is presently extended to customers in Thiruvananthapuram and Ernakulam.

• During the current year, the Bank introduced the In- Branch Cash Handling system (IBCH) in most of the branches. This enables the front office to provide better service.

11. Internal Control Systems &

Supervision

11.1 Integrated Risk Management

Bank’s risk management philosophy is based on a clear and timely identification of various types of risks, accurate risk assessment and measurement procedures and continuous monitoring. The Integrated Risk Management facilitates the Bank to have a holistic view of the risk management. Modular structure under Integrated Risk Management has various divisions focused on management of a specific risk – Asset Liability, Market Risk, Credit Risk, Operational Risk and Information Systems Security.

The risk management architecture of the Bank consists of the Board of Directors at the top having overall responsibility to implement Risk Management Systems in the Bank. To this effect, Risk Management Committee of the Board supervises the overall risk management functions of the Bank. In line with the modular structure of Integrated Risk Management, there are various risk management committees to have focused attention on various risks, viz. Asset Liability Management Committee (ALCO), Market Risk Management Committee (MRMC), Credit Risk Management Committee (CRMC), and Operational Risk Management Committee (ORMC). The General Manager (Risk Management) is designated as the Chief Risk Officer (CRO). The Integrated Risk Management Department headed by Deputy General Manager is responsible for the overall daily management of risks at micro level. For management of various risks, Bank has in place various policies and procedures.

11.2 Risk Management Functions

Asset Liability Management system has been implemented in the Bank, since April 1, 1999, as per the Reserve Bank of India guidelines on ALM and Liquidity Risk Management. As per the Bank’s ALM Policy, the Asset Liability Management Committee (ALCO) is authorised to evolve appropriate systems and procedures for ongoing identification and analysis of liquidity and market risks and to prescribe parameters for efficient management of these risks. The ALCO headed by Managing Director meets regularly to review and monitor the same. Liquidity and interest rate risks are identified, measured and monitored by the ALCO through the prescribed statements, viz. Statement of Structural Liquidity, Statement of Short Term Dynamic Liquidity, Statement of Interest Rate Risk Sensitivity (Traditional and Duration Gap methods), Stress Testing on Liquidity and Earnings etc. ALCO discusses these statements in detail and takes corrective actions whenever necessary. As per the Bank’s ALM Policy, a Contingency Funding Plan is reviewed on a quarterly basis. Bank’s Benchmark Lending Rates (Base Rate and BPLR) and Card Rates for Deposits are discussed and decided by the ALCO. The ALCO also discusses the economic developments and monitors the changes in the market on an ongoing basis.

Market Risk is largely managed through adherence to various policies, in the conduct of the investment and trading activities along with adherence to various risk limits like position limits, stop loss limits, Value at Risk (VaR), Management Action Trigger (MAT) and Cut Loss Triggers (CLT) through constant monitoring of the risk positions. The policies are reviewed periodically keeping in view regulatory changes, business requirements and market developments.

For Credit Risk management, the Bank has a structured and standardised credit approval process which includes comprehensive credit rating of proposals. For retail loans, Bank uses a risk scoring model. Bank has in place various exposure limits – for single borrower, group of borrowers, specific sectors, industries etc. – as per regulatory requirement and as per its internal policies. Bank takes up regular reviews of its various loan portfolios to assess the risk profile and initiates proactive measures.

The Bank is estimating capital charges for Operational Risk under Basic Indicator Approach. Other risk prone operational areas of the Bank’s business are monitored and proactive actions for improvement are initiated in consultation with other departments like Inspection, Systems & Procedure, Frauds Prevention, and Monitoring& Recovery etc.

11.3 Information Systems Security

With technology becoming all pervasive in banking operations, the Information Systems Security Cell plays a pivotal role in spreading awareness on various security measures among staff through various channels including e-mails, circulars, pamphlets as also Bank’s training system.

The Bank is closely monitoring the roadmap for migration to advanced approaches under Basel II and Basel III norms. In this direction, Integrated Risk Management Department has been conducting various programmes to disseminate the risk management knowledge to the operating units. This has resulted in better awareness among the operating staff about the various risks, importance of accurate data for computation of capital charge, need for capital conservation, and in general better risk management orientation

11.4 Inspection and Supervision

Internal Audit / Inspection is an independent appraisal of operations of various Systems and Controls within an organization to determine whether acceptable policies and procedures designed to add value and improve an organization’s objectives, are followed and resources are used efficiently and economically. Inspection and Audit Department at Head Office monitors various risk parameters by conducting regular Internal Inspection, IS Audit, Compliance Audit of Branches and System Audit of various Head Office Departments and Modules.

Apart from the above, Bank has put in place an effective institutional mechanism for Risk Based Supervision through RBS Cell in the Inspection Department. As envisaged by the Regulator, the Bank introduced Risk Focused Internal Audit (RFIA) under RBS with effect from 1st April, 2003. Based on the guidelines on Internal Audit issued by Government of India, Bank’s Inspection & Audit Policy has been suitably modified. The Bank has also incorporated the RBI guidelines on Information System Audit in the IS Audit Policy.

Subsequent to migration to Core Banking, and constant upgradation in technology, corresponding changes have been brought in, especially in the area of Audit Rating, Audit Report Formats, grouping of branches, sampling norms and periodicity of inspection.

In order to instill knowledge and to improve the quality of various reports, the Bank is imparting training for the existing and newly joined inspecting officials in the area of RFIA, IS Audits and Concurrent Audit. In order to improve the observance of systems and procedures, the Bank has introduced Dynamic Rating System. Compliance audit has been reintroduced from 01/01/2014.

11.5 Credit Audit

The audit of loan appraisal and administration for high value credit accounts, with the aim of improving the asset quality of the Bank, is undertaken by the Credit Audit Department. Accounts with total exposure of Rs 2 crore and above are covered under Credit Audit. Credit Audit was conducted for 1,179 accounts during the year, covering the pre-sanction, post sanction, compliance and follow up aspects. Credit Audit was also conducted for four accounts with exposure below Rs 2 crore during the year.

The Bank ensures that GOI and RBI directives/instructions received are being complied with promptly. Monthly reports of performance are regularly submitted to the Audit Committee of the Executives for information and the review reports are being submitted to the Audit Committee of the Board at its next meeting.

11.6 Inter-Office Reconciliation

Bank completed reconciliation of Inter Branch accounts up to 31st December, 2013. 100% reconciliation of debit entries were achieved from 01/04/2009 to 31/12/2013, which is in conformity with RBI stipulations.

Bank also introduced IBTS (Inter Branch Transfer System) for Inter Branch Reconciliation (in lieu of Branch Clearing General Account and Inter Branch Items in Transit) with effect from 10.06.2013.

11.7 Compliance

The Bank ensures timely compliance in submission of various statutory and regulatory returns and also prompt replies to references received from the Government of India / Reserve Bank of India and other institutions viz., State Bank of India, Indian Banks Association. The Chief Compliance Officer monitors the Compliance function effectively on an on-going basis to ensure that regulatory guidelines issued by RBI, GOI & other regulatory authorities are duly captured in the Bank’s policies and laid down instructions and that they are complied with at all levels. The Chief Compliance Officer further appraises the Audit Committee of the Board and the Group Compliance Officer of material breaches identified or reported along with the plan for mitigation of breaches.

The Compliance Department also provides secretarial services to the CPIO who deals with requests under the Right to information Act, 2005. The Deputy General Manager (Compliance) is also designated as the Appellate Authority under the above Act

11.8 KYC Norms & AML/ CFT Measures

The Bank has put in place a Board approved revised policy and procedural guidelines on Know Your Customer (KYC)/ Anti Money Laundering (AML) /Combating of Financing of Terrorism (CFT) measures in line with the master policy and subsequent guidelines issued by Reserve Bank of India. A dedicated KYC-AML Cell is functioning in the Head Office to oversee the compliance of KYC/AML/CFT measures. Controllers during their visits to the branches as also the Internal Auditors and Concurrent Auditors, verify compliance of KYC norms as per instructions issued from time to time.

The Deputy General Manager (Compliance) is the designated Principal Officer for the purpose of KYC/AML/CFT in the Bank However, primary responsibility of ensuring implementation of KYC/AML/CFT Policy and related guidelines will be vested with the respective Branches/ BPR units/ Controllers/ Zones/ Networks.

Monitoring of transactions is done with a view to submit the required reports to Financial Intelligence Unit-India, (FIU-IND), mandated by Prevention of Money Laundering Act 2002. With a view to implementing and supporting monitoring of transactions, the Bank has acquired appropriate software which is processing all transactions handled by all branches of the Bank, on a day to day basis. Monthly Cash Transaction Reports (CTRs) and Non Profit Organistaion (NPO) Transaction Reports (NTRs) are being generated by the system for submission to FIU-IND. Suspicious Transaction alerts are generated daily, for analysis by the KYC-AML Cell. After due analysis, suspicious transactions are reported to FIU-IND through Suspicious Transaction Report (STRs), where ever felt necessary. Counterfeit Currency Reports (CCRs) are also being submitted to FIU-IND as and when detected.

Training on KYC/AML is being imparted on an ongoing basis in the Bank. Staff awareness programmes are conducted regularly through seminars at Zonal/ Regional Office levels, Learning Centers and during branch visits.

11.9 International Financial Reporting Standards (IFRS)

The IFRS Cell at Head Office, is collecting, compiling and submitting IFRS compliant data to SBI, Mumbai. All relevant data up to the FY 2012-2013 have been submitted.

Associated Banks Integrated Treasury and M/s. Credence Analytics (I) Pvt Ltd have implemented an IFRS module for capturing Compliant data through Credence Software.

The Bank, being a member of the State Bank Group will be taking a common group approach on, convergence to IFRS.

12. Security Arrangements

During the year, no loss due to security breach in the Bank was reported. Based on the Risk assessment, Security Guards have been posted at our vulnerable Branches. All Currency Chest branches are provided with full- time security guards. All Bank branches are provided with essential safeguards like fire alarm systems, burglar alarm system. Controllers, Chief Security Officer, Security Officers attached to Zones and Fire Officers are constantly visiting branches and monitoring security measures provided at branches. Immediate remedial measures are taken wherever necessary.

13. Vigilance Machinery and Frauds Monitoring

Preventive vigilance measures

Due to initiation of Preventive Vigilance mechanism through various measures, such as Surprise Inspections, Branch visits, circulars, vigilance awareness meetings, Bank could inculcate a sense of positive approach towards compliances from vigilance angle among all the functionaries including adherence to systems and procedures.

Leveraging technology in vigilance administration has been given priority. The technology initiatives introduced during the year includes E-VVR checking, E-tendering software solutions and Biometric access to CBS.

A programme on positive vigilance in Contracts and Procurements was conducted in May 2013 for the benefit of officers handling various contracts and procurements in the Bank. At the request of CBI a training programme for investigating officials of the CBI was conducted by the Department at Thiruvananthapuram from 2/09/2013 to 6/09/2013.

"A Whistle Blower Policy" was introduced by the Bank as a part of anti corruption initiative and also to detect and prevent unfair practices wherever reported. The complaints received under the policy were studied and investigations were conducted. The details of Whistle Blower are kept confidential.

As part of monitoring preventive vigilance activities, Preventive Vigilance committee has been set up in larger branches where staff strength at present is 10 or more. This helps the Branch Manager to discuss collectively the vigilance matters concerning the branch and work in a coordinated manner. All other branches having Staff Strength of below 10 have also been advised to discuss vigilance matters in the monthly staff meeting.

As per the direction of the Central Vigilance commission, the CVO is scrutinising the complaints received by the Bank and is suggesting necessary actions where vigilance angle is discernible. As regards complaints directly received by the CVO, vigilance investigation is conducted, if vigilance angle is discernible in such complaints. In cases of anonymous complaint / pseudonymous complaint which have veri_able facts, vigilance investigation is conducted selectively in terms of CVC guidelines.

Vigilance Awareness Week was observed from 28/10/2013 - 01/11/2013 with pledge administered at Head office / other offices/ branches. This year’s topic for Vigilance Awareness week was "Promoting Good Governance – Positive Contribution of Vigilance". In connection with the vigilance awareness week variety of programmes such as Quiz competition, Essay competition, Elocution competition and talk by eminent speakers on the subject were organised at Head Office and Zonal Offices to spread awareness of vigilance and anti corruption. In addition to spread the awareness among employees the students from schools and colleges were also involved in the above programmes.

The Vigilance Department apprise the Board of Directors every quarter on the status of disposal of vigilance cases and also the preventive vigilance measures being followed in the Bank.

14. Right to Information Act

The Right to Information Act, 2005 has been implemented in the Bank since 2005-06. The Deputy General Manager (Compliance) at Head Office has been nominated as the Nodal Officer under the Act and a system has been put in place to receive the applications / queries from the public seeking information about the Bank and related matters and to furnish prompt replies within the time frame stipulated under the Act. Central Public Information Officers, Assistant Central Public Information Officers and Appellate Authorities have also been nominated at Head Office and Module offices in terms of the Act.

During 2013-14, 1,199 applications were received and 1,184 applications were disposed. 149 appeals were received and 148 appeals were disposed off promptly and within the time frame under the Act.

15. Human Resources Development &

Industrial Relations

15.1 As on 31-03-2014, the Bank had on its rolls 14,491 members of staff, comprising 5,094 officers, 7,005 clerical and cash department staff and 2,392 subordinate staff inclusive of 643 Maintenance Staff. The number of women employees and ex-service personnel constituted 5,864 and 1,665 respectively of the total work force. Out of the women employees, 1,557 are officers, 3,521 non-subordinate staff and 786 subordinate staff. The Bank has also on its rolls 231 persons with disability.

15.2 During the year, 2,761 staff were recruited (116 in the officers’ cadre, 2,210 in Non – subordinate and 435 in the subordinate cadre).

	OF WHICH
Staff Strength particulars as on 31-03-2014	Total	SC	ST EX-SER		WOMEN	PWD
Officers	5094	648	145	145	1557	67
Clerical	7005	910	196	773	3521	154
Subordinate (Exc. MS)	1749	396	71	747	304	8
Maintenance Staff	643	171	13	-	482	2
Total Staff	14491	2125	425	1665	5864	231

No of Staff Recruited – 2013-2014

Cadre	Total
Officers	116
Clerical	2210
Sub-staff (Including Maintenance Staff)	435
Total	2761

15.3 During the year 49 employees were promoted from Maintenance Staff to Subordinate Staff, 44 employees were promoted from subordinate to non-subordinate cadre, 164 employees were promoted from clerical cadre to the Officers cadre and 609 promotions took place within Officers’ cadre.

15.4 Staff Productivity

Business per employee stood at Rs 11.56 crore as on 31st March, 2014 as against Rs 12.59 crore as on 31st March, 2013.

Net Profit per employee was Rs 2.20 lac as on 31st March, 2014 compared to Rs 5.06 lac a year ago.

15.5 Training

Training programmes are conducted at our Learning Centres at Thiruvananthapuram and Ernakulam with the objective of updating the knowledge, improving skills and reorienting the attitude of our officers and employees on an ongoing basis with particular reference to areas of corporate goals/concern areas.

During the year under review 262 training programmes were conducted imparting training to 4,239 Officers, 2,501 non-subordinate staff and 93 subordinate staff.

In addition to in-house training programmes 1,301 officers were deputed to the Apex Training Institutes of State Bank of India, RBI and other centres for training. The centres include State Bank Staff College, Hyderabad, State Bank Academy, Gurgaon, State Bank Institute of Rural Development, Hyderabad, State Bank Institute of Information and Communication Management, Hyderabad, College of Agricultural Banking, Pune, RBI Chennai, National Institute of Bank Management, Pune, Institute for Development and Research in Banking Technology (IDRBT), Hyderabad, Centre for Advanced Financial Research and Learning (CAFRAL), BIRD, Lucknow, IIBF, Mumbai, IIBM, Guwahati, IMI, New Delhi, CBI Academy, Ghaziabad, FEDAI, NI-NSME, Hyderabad.

15.6 Pre Recruitment and Pre-Promotion Training to SC/ST/OBC

The Bank has conducted pre-recruitment training programme for candidates belonging to SC/ST/ OBC category appearing for written examination for selection of Peons. Classes were conducted at five centres in Kerala. 3,187 candidates belonging to the above categories attended the training. Other eligible candidates were supplied with hand outs.

Pre Promotion training and Mock Interviews were conducted for employees belonging to SC/ST/OBC category, appearing for promotion from Sub-ordinate to Non subordinate cadre and Non-subordinate cadre to Officer cadre. Mock interviews were also held for SC/ST candidates selected to attend the interview for conversion of maintenance staff to full time Subordinate Staff.

15.7 Orientation Programme for Newly Recruited Employees

About 2,200 new recruits joined the Bank in clerical cadre during the year. The Bank has given orientation training to all of them.

Orientation training was also imparted to the newly joined Probationary Officers and to the officers promoted from the clerical cadre. Intermediate Programme was conducted for 387 Probationary officers recruited last year. Officers promoted under Group B last year were also given intermediate training.

15.8 Foreign Training

During the year, two officers were deputed to attend the 8th FEDAI Annual Conference at Singapore. One officer was deputed to attend an International Banking seminar, at Deutsche Bank, New York.

15.9 E-Learning Campaign

In order to popularize and promote the usage of e-Learning among the Bank’s staff a campaign was conducted. On completion of the campaign cash incentives and certificates were distributed to successful candidates. Toppers were invited to P-review meeting and presented with citations.

15.10 Reward & Recognition

The Bank has formulated a scheme to recognize and motivate high achievers among our branches by awarding the honour of MD’s Club, CGM’s Club and GM’s Club membership to top performing branches.

15.11 Human Resources Management Solutions (HRMS)

The Bank has rolled out Project HRMS, with a view to automate, integrate and centralize HR processes of the Bank. HRMS has not only become a single and central source of information tool for the decision takers and policy makers enabling efficient HR Management but also a tool for employee satisfaction through transparent and time bound monetary transactions relating to emoluments and perks payment through uniform interpretation of the Bank’s instructions as well as other services.

15.12 Staff – SC/ST Cell

Reservation Rules—Implementation in our Bank

Reservation policy has been implemented in the Bank for Scheduled Castes and Scheduled Tribes from 1972 in direct recruitment and from 1978 in promotion.

Reservation at 15% for SCs and 7.5% for STs is provided in direct recruitment for Officers cadre. In direct recruitment to Clerical and subordinate staff cadres, percentages of reservation as applicable in each State are provided for SCs and STs respectively. In promotion from Clerical cadre to Officers cadre 15% and 7.5% of the vacancies are reserved for SCs and STs. Likewise in promotion from Subordinate to clerical cadre 15% and 7.50% of the vacancies for SCs and STs respectively are provided where element of direct recruitment does not exceed 75%.

The other tasks undertaken by the Cell are:

• Ensuring compliance, by the Bank, with orders and instructions pertaining to the reservation in favour of SCs/STs in the matter of recruitment/promotions another service benefits such as relaxations/ concessions admissible to them.

• Ensuring the placing of an Annual Review Report on the progress of implementation of reservation policy for SC/ST before the Board of Directors.

• Ensuring that while making reference to the Ministry of Finance (Banking Division) regarding de-reservation of reserved vacancies, the de-reservation proposal has been made with the full knowledge and concurrence of the Chief Liaison Officer.

• Ensuring that the Bank takes appropriate steps to provide all help and co-operation to the National Commission for SCs and National Commission for STs.

• Ensuring that GOI’s directions are followed in respect of DPCs/ Selection Committees pertaining to SC/ST/MC members.

• Ensuring proper implementation of the Reservation Policy by conducting annual inspection of the rosters maintained in the organization.

• Acting as Liaison Office between Bank and the Ministry of Finance, Govt. of India and National Commission for SCs, STs, OBCs and Minority Communities for supply of information, answering questions and queries and clearing doubts in regard to matters covered by the reservation orders.

The staff data as on 31.03.2014

Category	Total	SC	( % )	ST	( % )
Officers	5,094	648	12.72	145	2.85
Clerical	7,005	910	12.99	196	2.80
Sub-staff	1,749	396	22.64	71	4.06
Maintenance Staff	643	171	26.59	13	2.02
Total	14,491	2,125	14.66	425	2.93

Post based roster which shows a clear picture of implementation of reservation rules is maintained in the Bank, in accordance with the Government of India guidelines. Such rosters are being veri_ed by the Chief Liaison Officer for SCs and STs annually.

Whenever backlog of reserved vacancies for SCs and STs occur, such vacancies are filled through special recruitment. Last such special recruitment was conducted during 2009-2010 wherein 34 SC candidates and 12 ST candidates were recruited in Officers cadre. As at the end of March 2014, the position of backlog is as follows.

Backlog under Direct Recruitment to

	Category
Sl.No Cadre	SC	ST
1 Officer	22	129
2 Clerical	-	-
3 Maintanance Staff	-	-

Backlog under Promotion from:

	Category
Sl.No Cadre	SC	ST
1 Clerical to Officer cadre	52	41
2 Subordinate to Clerical Cadre	18	18

Backlog of ST vacancies under promotion from clerical cadre to Officer Cadre is due to non-availability of candidates in feeder cadre.

The following concessions/relaxations are made available to employees in the SC/ST category.

• Relaxation upto 5% of the required qualifying marks both in written test and interview is allowed in direct recruitment to subordinate and clerical cadre.

• Relaxation upto 5% of the required qualifying marks both in written test and Interview is allowed in promotion from clerical cadre to Junior Management Grade Scale- I under Group – A and Group – B channels.

• 5 years relaxation in upper age limit is allowed to candidates belonging to SCs and STs in recruitment to subordinate, clerical and Officer Cadres.

• 5 years relaxation in upper age limit is allowed to candidates belonging to SCs and STs in promotion from Clerical cadre to Officer Cadre under Group- B channel.

In recruitment, the total number of vacancies and number of vacancies available for SCs and STs are advertised extensively in newspapers.

Pre-examinationtrainingswereconductedatThiruvananthapuram, Kollam, Alappuzha, Ernakulam and Palakkad Centres, for SC & ST candidates who applied for recruitment as Peon from 11.11.2013 to 15.11.2013. Around 3,187 candidates attended the training and handouts have been sent by post and courier to 14,860 candidates who could not attend the pre-examination training. Similarly pre-promotion training to SC/ST employees were also conducted for promotion from Subordinate cadre to clerical (SWO-A) and clerical to Officers under Group A, B and D channels.

The Bank has designated an Officer of General Manager rank as Chief Liaison Officer for SC/ST. The Bank also has a separate Reservation Cell (SC/ST) headed by a Manager at Head Office and assisted by Liaison Officers at the eight Zonal Offices and two Regional Offices (Mumbai and New Delhi) to protect the interests of SC/ST employees. The Cell at Head Office arranges periodic meetings of the representatives of the SBT SCs& STs Staff Welfare Association with the Top Management to listen to and redress their grievances. The Bank has already provided a well-furnished office with telephone and computer to the Association. Check- off facility for payment of subscription by the members to the Association also has been provided. The Cell is also conducting meetings of Liaison officers of all the Zones/ Regional Offices at quarterly intervals. Such meetings are presided over by the Chief Liaison Officer to discuss issues, if any, pertaining to respective area. The General Manager (HR) also invariably participates in the meeting. The action points which emerge in such meetings are meticulously followed up to redress the issues.

15.13 Activities of Minority Communities [MC] / Other Backward Communities [OBC] / Persons with Disability [PWD] / Ex-Servicemen [EX-SER] Cell

The Bank has designated an Officer of General Manager rank as Chief Liaison Officer for OBC Cell and PWD/Ex-Servicemen Cell. The Bank has also designated an Officer of Deputy General Manager rank as Chief Liaison Officer for Minority Community. MC/OBC/ PWD & Ex-Ser Cell assisted by Liaison Officers at Head Office, eight Zonal offices and two Regional Offices are functioning to protect the interests of the employees belonging to the respective sections.

The Cell ensures:

• Compliance by the Bank with orders and instructions pertaining to the reservation of vacancies in favour of Ex- Servicemen and Persons with Disabilities in the matter of recruitment/ promotions and other service benefits.

• Compliance by the Bank with orders and instructions pertaining to the reservation of vacancies in favour of MC/OBC in the matter of recruitment and other service benefits.

• The Bank takes appropriate steps to provide all help and co-operation to the backward classes Development Corporation.

15.4 Industrial Relations

• The time tested mechanism of bilateral negotiations at various levels of the organisation with the Employees’ Union and the Officers’ Association through periodical structured meetings and redressal of the issues ensured harmonious and cordial industrial relations in the Bank throughout the year.

• Bipartite meeting was held with Officers’ Association at Bank level on 6.7.2013. The Bank participated in the Bipartite meeting held with State Sector Bank Employees Association (SSBEA) level on 16th and 17th September, 2013 and another Bipartite meeting held with Associate Bank’s Officers Association on 16/12/2013 at Gurgaon.

• Staff Welfare Committee (SWC) and Subcommittee meetings of SWF were held 7 times during the year.

• At the industry level, there were two strikes by United Forum of Bank Unions (covering both award and supervisory staff) during the year, ie, one day strike on 18/12/2013 and two days strike on 10th and 11th February, 2014.

• Online Employee Grievance Redressal System introduced in the Bank with effect from 1/12/2013 which provides for faster disposal of grievances of the Staff members at all levels.

• Details of complaints received on sexual harassment against women at work place as on 31/3/2014.

Received	Disposed	Pending as on 31/3/2014
2	2	Nil

During FY 13-14, the following activities under various Staff Welfare Schemes were undertaken:

• Under the Scheme for reimbursement of annual health check up for retired staff / spouse of the deceased retirees ( Rs 2,000/- per financial year) 4,102 applications were paid during the financial year.

• Under the scheme for reimbursement of health check up of spouse of staff members (ie, Rs 1,400/- per financial year) 3,852 applications were received during the financial year.

• Super Suraksha Insurance Scheme for employees was renewed with the life cover of Rs 5.00 lac per employee. 31 claims were settled under this scheme during this financial year.

• At present 20 holiday homes are functioning at 19 centers.

• Scholarships and tuition fees for wards of staff members amounting to Rs 112.39 lac were disbursed.

• Under the outpatient scheme reimbursement amounting to Rs 96.54 lac was made during this financial year.

• 29 applications were considered for payment under the scheme of financial assistance for expenses incurred by Staff Members for physically / mentally challenged / retarded / spastic dependent wards.

• 31 claims amounting to Rs 44.47 lac were paid under the scheme of part payment of outstanding in loan accounts at the time of death of an employee.

• 156 claims were paid under the funeral expenses scheme during this financial year.

• Bank Fest was conducted at Thiruvananthapuram from 5th December, 2013 to 7th December, 2013. More than 500 staff members participated from all the Zones.

16. Legal Services

The Bank has a well-established Law Department with law officers placed at Head Office, Zonal / Regional Offices and also at various Centers, and it plays a significant role in various activities of the bank. This Department performs multifarious duties such as preparation of general and case-specific documents, vetting and scrutiny of loan documents, giving advice on legal issues etc. This Department also plays an important role in the matter of recovery. Suits and DRT applications filed for recovery of dues are arranged and followed up by the Law Officers. They also assist the branches and other operational functionaries in enforcement of security under the SARFAESI Act, 2002 and also in defending the cases filed against the Bank before DRTs/DRATs/High Courts in this regard. Various cases, petitions and claims against the Bank filed in various High Courts, Tribunals, Civil Courts, Consumer Forum, Ombudsman, Labour Courts, Human Rights Commission and other authorities are defended under the advice and guidance of the Law Department.

In addition to the above, Law Department has launched ‘Law Portal’ for the internal use of the Bank. Law Portal is very informative and user friendly and helps the functionaries in accessing the panel of advocates, formats for documentation / SARFAESI, acts, rules, instructions, noti_cations, case laws etc. which are relevant for bankers.

17. Public Relations and Publicity

The Public Relations Department shoulders the responsibility of disseminating various information projecting Banks image among public and government departments. The department maintained close rapport with the Government departments, media, commercial and social organizations and the general public.

Extensive publicity was given through Newspapers, Hoardings, sponsored programmes, Visual and Electronic Media, to popularize Bank’s products. The marketing efforts at the Branches, supported by an intensive advertisement campaign all through the year at corporate level yielded impressive results on specific products

During the year, the Bank was one of the main sponsors of Nehru Trophy Boat Race, Kerala University Youth Festival, E-payment and E tender launching, NORKA Global meet. Programmes conducted by CII, NIPM, MPEDA, Costal Area Development Corporation, SIDCO, IIST, Kerala State Sports Council, Rotary Club, District Industries Centre, Kerala Police, ASIANET, Malayala Manorama, Mathrubhoomi, Times of India. were also supported by the Bank. Huge publicity was derived through the sponsorship of Sri Gopinath Muthucad’s Magic for awareness against the evils of drug and alcohol.

The prestigious ‘SBT Prathibha Samman’ award selection process was completed this year also and Dr Swaminathan the father of "Agriculture Revolution" in India, Sri K E Faizal, renowned social worker and Sri T K Jose IAS, the person behind the successful implementation of "Kudumbashree" in Kerala were selected as the award winners.

With an intention to impart competitive knowledge, and to improve publicity among the youth of Kerala, Bank conducted the ‘Intel Teen Quiz Programme’ during the year. Fifty colleges from various parts of the state participated in the programme. Our Managing Director gave away the prizes.

This year, many new hoardings were put up at vantage points in Ernakulam and Kozhikode to increase the exposure of brand SBT in the commercial cities of Kerala. The Bank sponsored the installation of a Digital Signage Board at Vyttila Mobility Hub, Ernakulam,.

In association with Asianet the Bank sponsored an Auto Expo at Kozhikode. Maximum publicity was derived through sponsoring the "SBT-JPL Cricket tournament organised by the Press club. The Bank also supported the International Film Festival by way of sponsorship.

The Bank won the second prize under PSU for the float presented in connection with the Onam celebration conducted by Department of Tourism, Government of Kerala.

The Bank’s Calendar for 2014 with the theme of "Flowers of Kerala", was widely acclaimed by the public and the Media. Bank’s internal house magazine "Mythri" still retains its eminence among other such publications.

The Bank opened pilgrim service centers at Pampa and Sannidhanam to cater to specific banking requirements of the pilgrims to Sabarimala, which generated tremendous publicity and goodwill for the Bank. We have also sponsored the Sabarimala Police web portal of ‘Virtual Queue’ which was utilized by 25 lac pilgrims this year.

18. Progressive Use of Hindi

The Bank complied with the provisions relating to the Official

Languages Act, rules and instructions, directives of Govt. of India and Reserve Bank of India. As per the guidelines of the Reserve Bank of India, the Bank introduced SBT Rajabhasha Shield for Zonal / Regional Offices situated at linguistic regions A, B and C. Hindi workshops and Hindi programmes were conducted for the benefit of staff members, to increase their knowledge of functional Hindi and attending to correspondence in Hindi. All the Letters received in Hindi were essentially replied to in Hindi.

Awards won:

The Bank participated in the State Level Official Language Exhibition instituted by Kerala Hindi Prachar Sabha and won First Prize for implementation of Official Language Policy. Bank secured First Prize instituted by the Town Official Language Implementation Committee, Thiruvananthapuram for the implementation of Official Language Policy in Public Sector .The Zonal Office, Ernakulam, Kozhikode and Thiruvananthapuram secured shields from their respective Town Official Language Implementation Committees for the implementation of Official Language Policy. The Ernakulam Zonal Office received the Award for the implementation of Official Language Policy, from the Govt. of India, Regional Implementation Office (South–West) Ministry of Home Affairs, Dept. of Official Language, Kochi.

Magazine and Publication:

Annual publication ‘Swathi’ the Bank’s Hindi Magazine ‘Rajabhasha Sahayika’ and "Phrases of official noting" were also published. Bank’s Zonal Offices at Ernakulam and Kottayam published Hindi Magazines during the year.

Programmes and Awards sponsored:

During the year, various competitions were held for school level students in Hindi. Hindi Fortnight / Hindi Day were also celebrated at Head Office, Zonal Offices and Regional Offices. Hindi Workshops were also conducted at Zonal Offices.

Each year the Bank sponsors "SBT P.G. Vasudev Puraskar" organized by Hindi Vidyapeeth Kerala. The award is for the noted Hindi Writers and contribution to Hindi language in Kerala. This year the award has honored the noted Hindi writer Dr. K.S Somanathan Nair of Kerala. The Bank also sponsors "SBT Hindi Sahitya Puraskar" organized by the Kerala Hindi Sahitya Academy. This year the award has honored the noted Hindi Writers Dr.Jayasree O. and Dr. K.G.Unnikrishnan of Kerala.

19. Branch Network

The Bank opened 104 new branches during the year. As at the end of 31st March, 2014 the total number of branches touched 1117, and now is represented in 15 States and 3 Union Territories. The Bank also has 13 extension counters.

The number of branches in Kerala increased from 758 in March, 2013 to 820 as on 31st March, 2014. A new Zonal office at Bengaluru was opened during the year. Seven Regional offices were opened at Thiruvalla, Kottarakara, Madurai, Thodupuzha, Hyderabad, Pala & Malappuram during the year for better operational control and faster credit dispensation.

The Bank has 43 Specialised Personal Segment branches, 11 NRI branches, 1 Housing Finance branch, 5 Treasury branches, 10 Service branches, 17 Commercial Business Network (CBNW) branches, 7 Commercial Network (CNW) branches, 20 Gold Point branches, 10 Specialised Krishi Point branches (Agricultural Development Branches), 8 Specialized SME branches, 2 Asset Recovery Management Branches, 1 Micro Credit branch, 1 Specialised branch for women entrepreneur, 1 Branch for State Government Transactions and 1 International Service Branch. Under the BPR initiatives, Bank has 14 RASMECCCs, 1 CPPC, 6 SARC, 2 TFCPCs, 1 LCPC and 19 CACs. The Bank is having 2 Exchange Bureaus, one at Kochi and another at Kozhikode in addition to the above branches/offices.

20. Premises

• The Bank has adopted a new web based "Fixed Assets Management System", developed in-house. The assets owned by Bank and that purchased by officers, for use in their quarters, under the existing scheme of the Bank are captured under the system.

• A new floor of 4500 sq.ft area was constructed in 2nd floor of NAC branch building in the Head Office campus and suitably connected to Head office building at its 3rd floor. The space was fully furnished and air conditioned and several departments shifted to this floor in October 2013.

• The entire 6th floor of Head Office was renovated and converted into an executive floor to accommodate cabins for 8 General Managers and a conference hall. An ultra modern ambience with several energy saving features have been incorporated.

• An Asset Tracking Centre with 40 seats was set up in a 3,200 sq.ft premises at Pattom..

• The Bank participated in auctions conducted by Delhi Development Authority (DDA) and successfully bid for a 200 sq.m plot in Sector 18, Rohini, New Delhi. Steps have been initiated for construction of quarters for officers on this plot.

21. Corporate Social Responsibility (CSR)

Bank, under Corporate Social Responsibility initiatives has extended a wide range of social activities both in rural and urban areas to serve the community at large. The major CSR initiatives under taken by the Bank during the year are as under:

• Medical equipment like BP apparatus, glucometer kit to Life Style Disease Clinic managed by Malabar Cancer Society Kannur - Yuva Vimukthi Project .

• Donation of ceiling fans and water puri_ers to needy schools all over India.

• Installation of solar lighting panels at school building, provision of books, stationery items, bags and laboratory equipment to the students at Shanti Bhavan Educational Trust – Residential School Hosur.

• Donation of Ambulance to Deena Daya Seva Trust, Thodupuzha.

• Reimbursed the full treatment and food expenses of identified deserving patients at Regional Cancer Centre Thiruvananthapuram, for one day.

• Donation of EEG machine to Vivekananda Medical Mission Hospital Attapady hospital.

• Provision of Mid-day meal to 12,000 students in 52 institutions in Central Kerala.

• Reimbursed full expenses of poor cancer patients for two days at Malabar Cancer Centre Thalassery .

21.1 Social Circles

Social circles are voluntary organizations formed by the staff members working in branches and administrative offices for undertaking social services. Bank is having 639 social circles functioning at various branches and administrative offices, spread all over India. Their activities include, Student welfare activities, health care programmes, welfare programmes for differentially abled people and inmates of orphanages & geriatric centres.

22. Sports and Games

• Cricket "A" Team

Bank’s Cricket A team participated in All India/All Kerala tournaments. Out of the 13 tournaments played, the team won 5 and became runner up in another 2 tournaments. During the year the team won All Kerala Coromandal Cement Trophy 2012-2013, All Kerala Coromandal Trophy 2013-2014, Mackey Memorial Tournament, All Kerala G.V. Raja Tournament, All India Bharamathi Tournament held at Pune and became runner – up in Mini Muthoot Tournament and Capt. Jerry Raj Tournament. In recognition of the performance 6 players were selected by the Kerala State team to represent the State in the Ranji Trophy and four others in U-25 and U-22 Kerala State Teams. It is also a matter of pride that one of the players, Shri. V A Jagadish was selected to the India "A" team. This is the first time that one of the players of the Bank got national recognition.

• Cricket "B" Team

Cricket B Team participated in the Trivandrum Dist league matches and also In the All Kerala GV Raja Tournament. Out of the 8 matches they played, the team won four matches.

• Football Team

The Senior Football team participated in 5 tournaments and won 3 and became runner-up in 1 and lost 1. The Team won the All India ONGC Tournament held at Mandi, Himachal Pradesh, All India United Trophy held at Kolhapur Maharashtra, Kerala State Club Football Championship - 2013 at Meenangadi, Wayanad and became runner up in the All India Jayant Patil Trophy held at Miraj, Maharashtra.

Eight players of the Bank participated in the Santhosh Trophy, representing the Kerala State Team, during the period.

23. Changes in the Board of Directors

During the course of the financial year 2013-14, the following changes have occurred in the Board of Directors of the Bank.

i) Shri P Nanda Kumaran, Managing Director, State Bank of Travancore, upon superannuation on 31st May, 2013 tendered his resignation from the Board of Directors.

ii) Shri S Vishvanathan, Managing Director & Group Executive (A&S) was appointed as Director, under clause (c) of sub-section (1) of Section 25 of the State Bank of India (Subsidiary Banks) Act, 1959, with effect from 17th July, 2013.

iii) The tenure of Shri K Muraleedharan Pillai, Director, ended on 18th July, 2013.

iv) Shri P V Prasad, Special Assistant, State Bank of Travancore, was appointed as Workmen Employee Director, under Clause (ca) of sub-section (1) of Section 25 of the State Bank of India (Subsidiary Banks) Act, 1959, with effect from 19th July, 2013 in place of Shri K Muraleedharan Pillai, Director.

v) Shri Pratip Chaudhuri, Chairman, State Bank of India, under Clause (a) of sub-section (1) of Section 25 of the State Bank of India (Subsidiary Banks) Act, 1959, upon superannuation on 30th September, 2013, tendered his resignation from the Board of Directors.

vi) Shri C Rajkumar, Chief Manager, State Bank of Travancore, was reappointed as Director, under Clause (cb) of sub-section (1) of Section 25 of the State Bank of India (Subsidiary Banks) Act, 1959, with effect from 1st October, 2013.

vii) Smt Arundhati Bhattacharya became a Director and Chairman of the Board of Directors of the Bank under Clause (a) of sub-section (1) of Section 25 of the State Bank of India (Subsidiary Banks) Act, 1959, with effect from 7th October, 2013.

viii) Shri V Kaliappan, became a Director, under Clause (c) of sub-section (1) of Section 25 of the State Bank of India (Subsidiary Banks) Act, 1959, with effect from 11th November, 2013.

ix) Shri Pradip Kumar Sanyal, General Manager (A&S), State Bank of India, Director, under Clause (c) of sub-section (1) of Section 25 of the State Bank of India (Subsidiary Banks) Act 1959, tendered his resignation from the Board of Directors of the Bank with effect from 20th November, 2013.

x) Shri. Purna Chandra Jena, General Manager (A&S), State Bank of India, was appointed as Director, under Clause (c) of sub-section (1) of Section 25 of the State Bank of India (Subsidiary Banks) Act, 1959, with effect from 26th November, 2013 in place of Shri Pradip Kumar Sanyal.

xi) Shri Jeevandas Narayan, appointed as Managing Director from 10th January, 2014, became a Director, on the Board of Directors in terms of section 25(1) (aa) of the State Bank of India (Subsidiary Banks) Act, 1959. xii) The tenure of Shri C N Venugopalan, Director, ended on 10th January, 2014.

xiii) The tenure of Shri T Balakrishnan and Shri K T Rajagopalan, Directors, ended on 31st January, 2014.

The Board of Directors welcomed Smt Arundhati Bhattacharya, Shri S Vishvanathan, Shri Jeevandas Narayan, Shri P V Prasad, Shri C Rajkumar, Shri V Kaliappan, Shri. Purna Chandra Jena, as Directors of the Bank.

The Board of Directors placed on record their appreciation and thanks for the valuable services rendered by Shri Pratip Chaudhuri, Shri P Nanda Kumaran, Shri K Muraleedharan Pillai, Shri Pradip Kumar Sanyal, Shri C N Venugopalan, Shri T Balakrishnan and Shri K T Rajagopalan during their tenure as Directors of the Bank.

24. Board and Executive Committee Meetings

During the year 2013-14, seven Meetings of the Board of Directors were held. The Executive Committee of the Board of Directors met 13 times.

25. Statutory Audit

M/s. Abraham & Jose, Thrissur, M/s. G.K. Rao & Co., Hyderabad, M/s R.G.N.Price & Co, Chennai, and M/s Kumar Vijay Gupta & Co. New Delhi were appointed as Statutory Auditors of the Bank for the year 2013-14 by State Bank of India, with the approval of Reserve Bank of India. The Board of Directors sincerely appreciates the valuable suggestions offered and the excellent support and cooperation extended by the Statutory Central Auditors for the completion of the audit well in time.

26. Acknowledgments

The Board of Directors gratefully acknowledge the valuable advice and support extended by the Ministry of Finance, Government of India, Reserve Bank of India, Indian Bank’s Association, State Bank of India and the cooperation and support extended by the Securities and Exchange Board of India, Financial Institutions, Stock Exchanges and Correspondents. The Board also wishes to place on record its sincere appreciation for the excellent support, goodwill and patronage received from the esteemed customers and shareholders, the support and cooperation extended and contributions made by the members of staff- award and supervising. The Board also places on record its appreciation for the contributions made by the Employees’ Union and Officers’ Association.

By Order of the Board,

Jeevandas Narayan

Managing Director