MIRA
INFORM REPORT
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Report Date : |
14.09.2007 |
IDENTIFICATION DETAILS
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Name : |
BANK OF |
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Registered Office : |
14th |
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Country : |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
07.09.1906 |
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Com. Reg. No.: |
11-243 |
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CIN No.: [Company
Identification No.] |
U99999MH1906PTC000243 |
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Legal Form : |
A Public Sector
Commercial Bank. The bank's shares are
listed on the Stock Exchanges. |
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Line of Business : |
Banking Services |
RATING & COMMENTS
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MIRA’s Rating : |
Aa |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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Maximum Credit Limit : |
Large |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a
leading commercial bank, listed on the Stock Exchanges and owned by the
Government of India. Available information indicates high financial responsibility
of the Bank. Their trade relations are reported as fair. Financial position
of the bank is satisfactory. Payments are usually correct and as per
commitments. The bank can be
considered good for normal business dealings at usual trade terms and
conditions. |
LOCATIONS
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Registered Office : |
14th |
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Tel. No.: |
91-22-22023020 (36 lines) |
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Fax No.: |
91-22-22024701/56684558/22824212 |
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E-Mail : |
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Website : |
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Head Office : |
Star House, 3rd
Floor, East Wing, E47, C-5, G Block, Bandra Kurla Complex, Bandra (East),
Mumbai, |
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Tel. No.: |
91-22-56684490 / 56684441 / 444 / 900 |
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Fax No.: |
91-22-56684491 / 56684442 |
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E – Mail : |
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ZONAL OFFICES: |
Andhra Pradesh Zone
2nd Floor, Nagpur Zone
Bank of India Building, 3rd Floor, S. V. Patel Road, P. B.
No. 4, Nagpur – 440 001, INDIA Bihar North Zone
Bihar South Zone
Pradhan Towers, Near Overbridge, Main Road (South), P. B. No. 141,
Ranchi – 834 001, INDIA Eastern Zone
5, Northern Zone
Jeevan Bharti, Level-5, Tower-1, 124 Connaught Circus, North Western Zone
S. C. O. No. 181-182, Sector 17-C, Post Box No. 6, Chandigarh – 160
017, Punjab, INDIA Orissa Zone
12 Satya Nagar, Janpath, Unit 3, Bhubaneshwar – 751 007, Gujarat Zone
Bank of Pune Zone
1162/6 Shivajinagar, Madhya Pradesh Zone
Bank of Southern Zone
Garuda Building, 46 Cathedral Road, P. B. No. 4908, Gopalapuram Post
Office, Chennai – 600 086, Tamilnadu, INDIA Mumbai North Zone
`Caesar’s Court’, 2nd Floor, Mumbai South Zone
70-80, Uttar Pradesh Zone
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Branches : |
Located at :
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Overseas
offices: |
277,
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DIRECTORS
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Name : |
Mr. M. Balachandran |
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Designation : |
Chairman and Managing Director
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Name : |
Mr. K R Kamath |
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Designation : |
Executive
Director |
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Name : |
Mr. A V Sardesai |
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Designation : |
Nominee
(RBI) |
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Name : |
Mr. Rameshwar Prasad |
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Designation : |
Director
(Workman Employee) |
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Name : |
Mr. V Eswaran |
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Designation : |
Director |
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Name : |
Mr. K K Gupta |
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Designation : |
Director |
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Name : |
Ms. Prabha Taviad |
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Designation : |
Director(PartTime
NonOfficial) |
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Name : |
Ms. Shantaben Chavda |
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Designation : |
Director(PartTime
NonOfficial) |
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Name : |
Mr. V B Kaujalgi |
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Designation : |
Director(Shareholders) |
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Name : |
Mr. M |
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Designation : |
Director(Shareholders) |
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Name : |
Mr. T |
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Designation : |
Chairman
& Managing Director |
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Name : |
Mr. A D Parulkar |
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Designation : |
Executive
Director |
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Name : |
Mr. Tarun Bajaj |
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Designation : |
Nominee (Govt) |
SHAREHOLDING PATTERN
AS ON 30.06.2007
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Names of Shareholders |
No. of Shares |
Percentage of
Holding |
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Shareholding of
Promoter and Promoter Group2 |
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Indian |
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Cental/State Government(s) |
338580000 |
69.47 |
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Public
Shareholding3 |
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Mutual Fund/UTI |
13326478 |
2.73 |
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Financial Institutions/Banks |
85389 |
0.02 |
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Central/State Government(s) |
1250 |
0.00 |
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Insurance Companies |
14122187 |
2.90 |
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Foreign Institutional Investors |
78550510 |
16.11 |
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Non Institutions |
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Bodies Corporate |
4138023 |
0.85 |
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Individuals |
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i) Holding nominal share
capital upto Rs. 0.100 Million |
33876289 |
6.95 |
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ii) Holding nominal share capital
in excess of Rs. 0.100 Million |
1189267 |
0.24 |
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Any
Other(specify) |
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Overseas Corporate Bodies |
383000 |
0.08 |
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Non Resident Individuals |
3149407 |
0.65 |
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Total |
487401800 |
100 |
BUSINESS DETAILS
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Line of Business : |
Banking Services |
GENERAL INFORMATION
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No. of Employees : |
43141 |
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Bankers : |
Reserve Bank of |
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Banking
Relations : |
Good |
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Auditors : |
Ř
Brahmayya
and Company Chartered Accountants Ř
S. K.
Kapoor and Company Chartered Accountants Ř
Prakash
Chandra Jain and Company Chartered Accountants Ř
M. Bhaskara
Rao and Company Chartered Accountants Ř
Chhajed
& Doshi Chartered Accountants Ř
M.
Thomas & Company Chartered Accountants |
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Subsidiaries : |
[Fully Owned Subsidiary]
Stock Exchange,
Park House, 16 Finsbury Circus,
86,
068906 |
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Associates: |
62, Basantlok, Vansant Vihar,
Allied House, |
CAPITAL STRUCTURE
Authorised
Capital :
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No. of Shares |
Type |
Value |
Amount |
|
1500000000 |
Equity Shares |
Rs.10/- each |
Rs.15000.000 millions |
Issued,
Subscribed :
|
No. of Shares |
Type |
Value |
Amount |
|
488580000 |
Equity Shares |
Rs.10/- each |
Rs. 4885.800 millions |
Paid-up
Capital:
|
No. of Shares |
Type |
Value |
Amount |
|
487398800 |
Equity Shares |
Rs.10/- each |
Rs. 4873.988 millions |
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Add |
Share Forfeited |
|
Rs. 7.430
millions |
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Total |
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Rs.
4881.418 millions |
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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CAPITAL
& LIABILITIES
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Capital |
4881.400
|
4881.400
|
4881.419 |
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Reserves & Surplus |
54072.300
|
44957.500
|
39767.287 |
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Deposits |
1198817.400
|
939320.300
|
788214.379 |
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Borrowings |
66208.300
|
58939.100
|
59619.537 |
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Other Liabilities & Provisions |
92690.700
|
74763.900
|
57299.213 |
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GRAND TOTAL
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1416670.100 |
1122862.200 |
949781.835 |
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ASSETS
|
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Cash & Balances with Reserve Bank of |
71968.900
|
55884.100
|
39047.232 |
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Balances with Banks & Money at Call
& Short Notices |
102086.500
|
58575.700
|
36215.273 |
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Investments |
354927.600
|
317817.500
|
282026.230 |
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Advances |
849358.900
|
651737.500
|
560125.848 |
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Fixed Assets |
7893.000
|
8099.700
|
8141.756 |
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Other Assets |
30435.200
|
30747.700
|
24225.496 |
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GRAND
TOTAL
|
1416670.100 |
1122862.200 |
949781.835 |
PROFIT & LOSS
ACCOUNT
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PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Interest Earned |
91803.300
|
70287.000
|
60315.300
|
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Other Income |
15629.500
|
11843.800
|
11557.900
|
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TOTAL |
107432.800 |
82130.800 |
71873.200 |
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|
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Interest expended |
57398.600
|
43967.200
|
37946.400
|
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Operating Expenses |
26084.200
|
21151.400
|
19323.200
|
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Provisions & Contingencies |
12718.300
|
9997.800
|
11203.100
|
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TOTAL |
96201.100 |
75116.400 |
68472.700 |
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Net Profit for the year |
11231.700
|
7014.400
|
3400.500
|
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Prior Year Adjustments |
00.000
|
00.000
|
00.000
|
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Profit brought forward |
5417.600
|
2200.000
|
00.000
|
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TOTAL |
16649.300 |
9214.400 |
3400.500 |
QUARTERLY RESULTS
|
PARTICULARS |
|
|
30.06.2007 |
|
Type |
|
|
1st
Quarter |
|
Sales
Turnover |
|
|
27272.600 |
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Other
Income |
|
|
3811.500 |
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Total
Income |
|
|
31084.100 |
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Total
Expenditure |
|
|
8497.900 |
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Operating
Profit |
|
|
22586.200 |
|
Interest |
|
|
17800.500 |
|
Gross
Profit |
|
|
4785.700 |
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Depreciation |
|
|
00.000 |
|
Tax |
|
|
1633.700 |
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Reported
PAT |
|
|
3152.000 |
200706
Quarter 1 –
Provision and Contingencies includes Provisions for
Non-performing Assets of Rs 921.80 million EPS is Basic & Diluted Status of
Investor Complaints for the quarter ended June 30, 2007 Complaints Pending at
the beginning of the quarter Nil Complaints Received during the quarter 19
Complaints disposed off during the quarter 19 Complaints unresolved at the end
of the quarter Nil 1. The above results have been taken on record by the Board
of Directors of the Bank at its meeting held on July 25, 2007. 2. Pending RBI
guidelines on AS-15 (revised) provision for employee benefits viz gratuity,
pension, leave encashment etc has been made on an estimated basis. The
financial results for the quarter ended June 30, 2007 have been arrived at
after considering provisions for non performing assets, non performing
investments and standard assets as per RBI guidelines. 3. Figures of the
previous period have been regrouped / rearranged wherever necessary to conform
to current period classification.
KEY RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Credit Deposit Ratio |
70.21 |
69.87 |
67.45 |
|
Investment Deposit Ratio |
31.46 |
35.00 |
37.16 |
|
Cash Deposit Ratio |
5.98 |
5.50 |
5.41 |
|
Interest Expended/Interest
Earned |
62.52 |
62.55 |
62.91 |
|
Other Income/Total Income |
14.55 |
14.42 |
16.08 |
|
Operating Expense/Total Income |
24.28 |
25.75 |
26.89 |
|
Interest Income/Total Funds |
7.24 |
6.79 |
6.72 |
|
Interest Expended /Total Funds |
4.53 |
4.25 |
4.23 |
|
Net Interest Income/Total Funds |
2.71 |
2.54 |
2.49 |
|
Non Interest Income/Total Funds |
1.23 |
1.14 |
1.29 |
|
Operating Expense/Total Income |
2.06 |
2.04 |
2.15 |
|
Profit Before Provisions/Total
Funds |
1.89 |
1.64 |
1.63 |
|
Net Profit/Total Funds |
0.89 |
0.68 |
0.38 |
|
Return On Net Worth(%) |
21.25 |
15.37 |
8.36 |
STOCK PRICES
|
Face Value |
Rs.10.00/- |
|
High |
Rs.262.60/- |
|
Low |
Rs.255.50/- |
LOCAL AGENCY FURTHER INFORMATION
HISTORY
Bank of India (BOI) was incorporated in 1906 by a group of eminent
businessmen in
While firmly adhering to a policy of prudence and caution, the bank has been in
the forefront of introducing various innovative services and systems. Business
has been conducted with the successful blend of traditional values and ethics
and the most modern infrastructure.
It is a bank with a tradition of 97 years with group presence in several
business like Merchant banking, Housing Finance, Leasing, Venture capital,
Credit card, Mutual Fund, Stock Broking etc. It embarked on a major expansion
plan of increasing its branch network in rural and semi urban areas after its
nationalisation.
It was the first Indian Bank to open a branch outside the country. During
2004-05 the bank opened 34 new branches in
The banks recently started Depository Participant (DP) business at Mumbai,
Ahmedabad,
As part of its strategy to give due focus to core banking, the bank has decided
to prune down our non-core activity by rationalising the subsidiaries. It
fulfilled the obligation of the assured returns to its investors in respect of
two schemes floated by its subsidiary, BOI Mutual Fund. One of the schemes,
which matured on March 2002, is being redeemed by the mutual fund, while two
other schemes have been sold to M/s Taurus Mutual Fund. This will pave way for
closing down of the Mutual Fund arm. Another subsidiary, BOI Finance, has been
amalgamated with the bank. BOI Shareholding is performing well in conjunction
with the Stock Exchange, Mumbai, in the clearing and settlement business.
The Bank has been constantly exploring for uncharted viable and profitable
business opportunities. The Bank's large and well-distributed branch network
and wide customer base, which are its strength, are being leveraged for
generating new business so as to augment fee income. It has tied-up with ICICI
Prudential Life Insurance for providing reference of our customers for sale of
their life insurance products against a referral fee. This scheme is being
piloted at 7 centres, covering 70 branches, which will be expanded to other
centres in a phased manner. The bank has also entered into an arrangement with
ICICI Bank for using its wide branch network for their cash management services
covering 1000 branches, which is expected to generate turnover of Rs. 20000
Millions and add to non interest income of the Bank. During 2005 the bank had
118 specialised branches providing various financial services to customers in
India, Which includes 9 Corporate Banking, 7 Overseas, 35 Commercial &
Personal Banking, 9 Housing & Personal Finance, 32 SSI, 4 Hi-tech Agricultural
Finance, 12 recovery, 6 NRI, 3 Capital Market Branches and 1 Treasury Branch.
We have also a strategic tie up with Securities Trading Corporation of India
(STCI), in facilitating secondary market sale of Government Securities [G-Secs]
to retail investors through our branches.
PERFORMANCE
HIGHLIGHTS:
BUSINESS
INITIATIVES:
* Strategic
* Memorandum of Understanding entered into for setting up a Life Insurance
joint venture with Dai-Ichi Mutual Life Insurance Company and Union Bank of
* Major initiatives in international operations included opening of branch at
* Bank has finalised acquiring of 76% stake in PT Bank Swadeshi Tbk, a listed
bank in
* Taken over management of Almana Exchange House at
FINANCIAL REVIEW:
Vigorous growth with strong macro economic fundamentals characterised
development of Indian economy in 2006-07. While the up and down growth pattern
in agriculture continued, services sector maintained its strong growth and
there were distinct signs of sustained improvement on the Industrial front.
Financial markets remained generally unstable during 2006-07 in line with global
trends. The interest rates firmed up due to higher inflationary expectations
resulting in slower growth in deposits compared to deployment of credit,
causing a mismatch in the credit & deposit growth rates.
As on March, 2007, non-food credit grew by a robust 28% (Rs.4102850 Millions),
whereas Deposits SCBs marked a year on year growth of 23%. during the same
period, Time deposits grew by 24.5% while the growth in demand deposits was
16%. As in the previous year, this year too, credit growth outpaced deposit
growth.
Capital inflows into
The Bank took advantage of the buoyancy in economic growth and expanded credit
in all segments including priority sector and retail. The Bank increased its
share in infrastructure sector and added new clientele in the areas of
corporate finance and export finance. The credit flow to agriculture also
improved in conformity with Government guidelines. Thrust on mobilisation of
low cost deposits continued.
MANAGEMENT DISCUSSION AND
ANALYSIS:
Business Environment: The Indian economy is on an expansionary path and has
moved from a phase of moderate growth to one of high growth. Real Gross
Domestic Product increased by 9.2% in the advance estimates of CSO. The notable
features in the current growth phase are high rate of investment, growth in the
infrastructure sector, huge foreign capital inflows and reduction in fiscal
deficit. Rising inflation continued to be an area of concern with an average
inflation rate of 5.4% during the year 2006-07.
Industrial activity picked up in an environment of favourable demand
conditions, strong corporate profitability and business optimism. The growth
impulses within the industry also spread to manufacturing sector. Strong growth
in Trade, Hotels, Transport and Communications, as well as Finance, Insurance
and Real Estate Sectors together boosted growth in the services sector, which
grew at 11% during 2006-07 as against 10.3% a year ago.
Fiscal deficit was lower than the budget estimates at 3.7%. Faster
growth in imports and a relative slow down in exports contributed to the
Country's adverse trade balance. Trade deficit during the period was of the
order of Rs.1523280 Millions.
Money supply grew at an accelerated pace. The year on year growth during
2006-07 was 20.8% driven mainly by higher deployment of credit by commercial
banks.
Deposits mobilised by scheduled commercial banks marked a year on year growth
of 23% during 2006-07. The growth in deposits has been lagging behind credit
growth since the beginning of the year. The ongoing boom in the economy has
kept the demand for credit buoyant. Non-food credit grew by a robust 28% on top
of 31.8% in the previous year.
Foreign exchange reserves increased from US $151.62 billion as at end
March, 2006 to US $199.2 billion as on March 31, 2007.
The stock markets continued to be volatile with the BSE Sensex touching a high
of 14724 and a low of 8920 touching a level of 13072 points by end March 2007
following market corrections over the period.
The Indian rupee continued to appreciate against the U.S. Dollar. The rupee
started gaining from September 2006 onwards. In March, 2007, the rupee
appreciated to Rs.44.03 against the U.S. Dollar as against Rs.44.61 in March
2006.
Industry Structure and Developments:
The Year 2006-07 generally witnessed orderly trends in the financial markets
although tight money conditions prevailed mainly on account of stringent norms
of the regulator and on account of mismatch in deposit and credit growth
rates.
To meet the rising demand for credit several banks resorted to raising funds
from domestic & international markets.
The limit for tax deduction at source on interest earned on deposits has been
raised from Rs.5000 a year to Rs.10000/-. During the year, the Cash Reserve
Ratio was raised by the RBI from 5.0% to 6.5% with a view to drain excess
liquidity from the system and check inflation. Financial markets responded to
these developments through raising the interest rates on deposits & credit.
The RBI tightened provisioning norms for real estate sector, outstanding credit
card receivables, loans and advances qualifying as capital market exposures and
personal loans in order to check increasing asset prices and also lop sided
flow of credit into these sectors. The provisioning requirement in respect of
standard assets in these categories was increased to two percent from the
existing level of one percent. Also, Provisioning requirement for bank's
exposure in the standard assets category to non-banking finance companies
increased to 2% from the existing level of 0.4%.
Opportunities:
The step up in the Country's growth during 2003-04, strengthened into an upward
shift during the year resulting in a buoyancy in industrial performance and an
optimistic business and investment climate. Demand for Credit is expected to
grow which in turn is likely to increase the operational income of banks.
It is estimated that about 56 million of the Country's population and 70% of
the rural population is unbanked, banks have immense potential to grow their
business, if they tap the 50 million unbanked and rural populace strategically
through promoting various schemes for financial inclusion. Considering that
only 21 percent of the rural households avail formal credit, there exists a
large scope for credit expansion by promoting viable/bankable schemes to this
segment. The Union Budget 2007-08 has to an extent reduced the disadvantage
Commercial Banks suffered compared to Small Savings Schemes of the Government
of India and also the equity & debt market instruments. Raising of TDS
ceiling on interest on bank deposits from Rs.5,000 a year to Rs.10,000 and also
increasing the Dividend Distribution Tax for Companies has made investment in
bank deposits more attractive now. This is likely to give an impetus to Bank's
deposit mobilization efforts. Also, under differential rate of interest scheme
composite loan limit has been raised from Rs.6500 to Rs.15000 and housing loan
limit raised from Rs.5000 to Rs.20000 per beneficiary. This is likely to help
and enhance financial inclusion efforts of banks.
About Rs.2250000 Millions farm credit has been proposed in the union budget
2007-08, with a proposal to bring additional 50 lakh farmers under farm credit
purview. Thus the importance of agriculture in the economy is once again
underlined.
The bottomlines of banks would look up for the time being during 2006-07 as RBI
decided to pay graded interest on eligible CRR balances held above the minimum
3%. However, this is not likely to be continued beyond March 2007.
Retail banking has emerged as a growth engine in the recent past with vast
potential. Besides, this sector offers higher spread and better recovery ratio.
RBI has, however, sounded a caution to banks advising them to go slow on Retail
lending in order to contain rising inflation.
In the coming years there may be increasing trend towards consolidation as size
matters in global competition. Indian banks will have to position themselves
appropriately and enlarge their size in line with international standards to
face the challenges that are ahead in the coming years and also face
competition.
A new avenue has opened up for banks with post offices stepping into front end
retailing services for commercial banks in both urban and rural areas where
commercial banks do not have sufficient penetration.
Outlook:
The economy has moved from a phase of moderate growth to a new phase of high
growth. There has been industrial resurgence with the industrial sector
touching 11 percent growth during the period April - February, 2007. The services
sector too contributed 11% to Real GDP during 2006-07.
High rate of investment growth, pick up in the infrastructure sector and
continuous foreign capital inflows are likely to make the high economic growth
sustainable throwing up new opportunities for banks. Thus outlook for business
growth during 2007-08 is bright.
Government's ambitious investment plans for agriculture sector would open new
vistas of financing for the Bank. The bank visualises good opportunities for
growth in the SME sector too in view of the thrust given to the same.
The bank has taken various business & I.T. initiatives during the year to
ensure that emerging challenges and competition can be faced successfully.
Risk Management systems are being improved in keeping with the Basel II norms.
Taking into account the changing requirements of customers, new products are
being launched by the Bank. Advertising strategy has also been revamped and a
new brand caption 'Relationships beyond Banking' was adopted to address audience
segments at an emotional level. International operations are being expanded and
the Bank is extending its network of branches abroad.
Strong fundamentals, large branch network and technological resources are
expected to help improve business and earnings. The large presence of the
Bank in rural areas offers significant scope for growth of business. The
Bank is confident of a bright outlook for business during the coming
years.
BUSINESS REVIEW:
Deposits:
Bank's deposits increased by Rs.259500 Millions to Rs.1198820 Millions during
the year recording a growth of 27.6%. The growth in domestic deposits was to
the tune of Rs.168930 Millions or 21.7%. Deposits with foreign branches
increased by Rs.90570 Millions, recording a growth of 56.3%.
Non-Resident Deposits of the Bank increased from Rs. 97590 Millions as on
March, 2006 to Rs.107580 Millions which constituted 11.45% of aggregate
domestic deposits. Our 6 NRI Branches and 12 NRI centres have been providing
services to Non-resident Depositors matching international standards. 143
branches spread across the country have been authorised to handle FCNR
deposits. At present, Bank is accepting FCNR deposits denominated in six
currencies i.e. USD, GBP, JPY, EURO, CAD and AUD. Our NRI Branches at Mumbai,
Savings Bank deposits grew by 14.8% and current deposits logged a growth of
35.1% in domestic operations. The share of low cost deposits comprising of
saving and current deposits to total deposits is 40%.
With a view to remain competitive and offer a variety of products & service
to clients, the bank introduced new deposit products viz. Star Shatabdi Term
Deposit Scheme, Star Sunidhi Tax Saving Deposit Scheme, Star Flexi Recurring
Deposit Scheme, Star Vaibhav Deposit Scheme and Star Floating Rate Deposit
Scheme (Corporate) and also Star Vaibhav-400. All the products were well
received by the public.
The Bank has carved out a team of 1000 proactive well trained personnel for
focussed marketing efforts and has placed them in strategic locations. At these
strategic centres, there are specially chosen and trained marketing teams
consisting of marketing managers, marketing officers and marketing associates
focussing on development of business in thrust areas of Retail banking &
SME financing.
The bank has a well diversified deposit base with 14.59% of domestic deposits
coming from rural areas, 13.77% from semi urban, 20.86% from urban & 50.78%
from metro areas. The bank?s total clientele base of 27 million consists of 25
million depositors and 2 million borrowers as at end of March 2007.
Advances:
The gross domestic credit of the Bank registered a growth of 29% from Rs.540230
Millions on 31.03.2006 to Rs.698110 Millions. This growth rate is better than
last year. The growth has been made possible with continued increase in credit
off-take by Large and Mid Corporate SBUs coupled with increase in SME and
retail segments.
The Bank expanded its share in infrastructure sector. In the areas of Corporate
finance and export finance, Bank's thrust has been on selective mobilisation of
new clientele while at the same time nurturing existing clientele by meeting
their total credit requirements.
Bank has started a new syndication desk to give focussed attention in servicing
corporate customers. On the technology front enabling of e-corporate module
facilitated the corporates to give LC applications on line for processing at
corporate branches.
Bank through its 123 specialised branches caters to the various specialised
segments of borrowers in Corporate Credit, Exports & Imports, Small Scale
Industries, High-tech Agricultural sector, Corporate finance and Commercial and
Personal segments.
LEAD BANK:
The Bank has been assigned with Lead Bank responsibility in 46 districts spread
over 5 States viz. Jharkhand (13),
Forex Business:
The forex business handled by the bank showed a robust growth. Export turnover
increased to Rs.247000 Millions as on 31.03.2007 from Rs.225100 Millions and
the import turnover was Rs.215000 Millions for the year 2006-07. The Bank
continues to be a leading player in forex market. Turnover of Bank's Treasury
Branch has gone up to Rs.3612639.700 Millions.
BANK'S
SUBSIDIARIES/ASSOCIATES:
Regional Rural Banks (RRBs): The Bank has sponsored 16 Regional Rural Banks
operating in five States. With a view to providing economies of scale,
consolidation process was initiated for their amalgamation during 2006-07. Thus
13 RRBs were amalgamated to form 7 new RRBs. These RRBs are operating in 37
districts (with a network of 972 branches, 20 Satellite branches and 1
Extension Counter) in which our Bank is entrusted with the Lead Bank responsibility.
Besides initial subscription of Rs.56 Millions to their issued capital, the
Bank has infused additional equity of Rs.547 Millions towards restructuring of
these RRBs. The Bank is providing necessary managerial and administrative
support to these RRBs. As at the end of financial year 2006-2007, the total
deposits and advances of these RRBs have grown to Rs.52190 Millions and
Rs.25140 Millions respectively. Out of the 7 RRBs, 6 have registered profit
during the year.
BOI Shareholding Limited:
Bank's association with the Capital Market spans over a period of more than
seven decades with the clearing and settlement functions of the
Stock Exchange Limited (BSE), Mumbai handled by the Bank. Later on in 1989, Bank
set up BOI Shareholding Limited a joint venture with the Bombay Stock Exchange
Limited to manage the clearing house functions of BSE. The company is carrying
out the demat rolling settlements on T+2 basis of the Exchange through the
National Securities Depository Services Limited (NSDL) and Central Depository
Services (
With a view to optimising use of its trained manpower and sophisticated IT
infrastructure, besides handling settlement related work of the Exchange, the
company also extends depository services to member brokers of the stock
exchanges and retail investors. During 2004-05, the company commenced new
business activity of franking of stamp duty on documents, which has contributed
significantly to its revenue stream.
BOISL earned a net profit of Rs.39.654 Millions during 2006-07 as against
Rs.30.925 Millions earned during 2005-06. The company paid an interim dividend
of 80% during 2006-07 as against 60% dividend paid during 2005-06.
Indo Zambia Bank Limited:
Indo Zambia Bank Limited (IBZ) is a joint venture of three Indian Banks viz.
Bank of India, Bank of Baroda, Central Bank of
Associate Company:
Securities Trading Corporation of India
Limited (STCI):
Securities Trading Corporation of India Limited (STCI) is one of the leading
Primary Dealers in the country enjoying the highest credit rating of P1+ by
CRISIL and A1+ by ICRA for short term debt instruments. Bank is the single
largest stakeholder of STCI with 29.95% stake in its equity.
On account of the sudden and swift hardening of interest rates and narrowing
down on margins in trading on gilt securities witnessed during 2004-05, the
company incurred losses in its operations for the first time. The Company could
however make a quick turn around during 2005-06 by posting a net profit of
Rs.240 Millions. During 2006-07, due to adverse market conditions the company
ended the F.Y. 2006-07 with a net loss of Rs.135.600 Millions. In the year,
2006-07 STCI acquired the UTI Securities Limited, a category I merchant banking
company registered with SEBI and engaged in investment banking, corporate
advisory services, institutional/ retail equity, derivative broking, portfolio
management services, depository services etc., from the specified undertaking
of Unit Trust of India. With this acquisition, the company hopes to mark its
presence in these varied fields. STCI has also decided to spin off its Primary
Dealership business into a separate company.
Other Strategic
Investments/Alliances:
IL&FS Investment Managers Limited:
IL&FS Investment Managers Limited is a premier private equity and venture
capital provider. Bank is the second largest stakeholder of IL&FS
Investment Managers Limited with 13.24% participation in the equity capital.
Bank has been earning good dividend on its investments in equity of IL&FS
Investment Managers Limited, besides having received bonus shares in the ratio
of one bonus share for every two existing equity shares of the Company during
2005-06.
Central Depository Services (
Central Depository Services (
ASREC (
The company was floated by the specified undertaking of the Unit Trust of India
to undertake securitisation and asset reconstruction activities. The Company
was granted Certificate of Registration by RBI under the SARFAESI Act, 2002 in
the second half of FY 2004-05 and has since commenced full-fledged operations.
Bank has an investment of 15.30% in the equity capital of the company and
expects to earn good returns thereon with growth in activities of the company.
Multi-Commodity Exchange of India
Limited (MCX):
MCX is a new generation multi-commodity exchange undertaking future trading in
multi commodities at the national level. The Exchange commenced operation during
FY 2004-05. Bank has a nominal stake of 2% by way of equity participation in
the capital of MCX with a view to be associated with one of the major commodity
exchanges. Bank also handles clearing bank functions of the Exchange through
Bullion Exchange Branch. MCX paid an interim dividend of 170% for FY 2006-07,
as against 20% dividend paid during 2005-06.
National Collateral Management Services
Limited (NCMSL):
National Collateral Management Services Limited is promoted by the National
Commodity and Derivatives Exchange Limited (NCDEX). It was incorporated on
28.09.2004 to promote and provide collateral management services for securing,
managing and controlling securities and commodities. It offers various services
for the development of trades on commodity exchange such as valuation, grading,
insuring, securing, storaging, distributing, clearing and forwarding of
securities and commodities etc. Bank holds a stake of 10% (Rs.30 Millions) in
the equity capital of the Company, thus providing opportunities to the Bank to
harness its association with NCMSL for credit lines to its members and
clients.
Credit Information Bureau (
CIBIL is the first credit information bureau in the Country, incorporated in
August, 2000 for providing credit information and risk analysis services to the
banking and financial services sectors. The company launched its consumer
bureau operations in FY 2004-05 and commercial bureau operations during
2006-07. Bank acquired a stake of 5% in the equity share capital of the company
during 2005-06 and expects to derive synergies through its association with the
company.
SME Rating Agency of India Limited
(SMERA):
SMERA was set-up during FY 2005-06 by SIDBI in association with Dun &
Bradstreet, one of the leading credit rating agencies. SMERA's primary
objective is to provide comprehensive, transparent and reliable ratings which
would facilitate greater and easier flow of credit to SME sector. Bank has a
nominal stake of 4% in the equity capital of the company.
Strategic
National Commodity & Derivatives
Exchange Limited (NCDEX):
NCDEX is one of the prime commodity exchanges, promoted by the National Stock
Exchange and other FIs and permitted by the Forward Market Commission to undertake
on-line screen based trades in agricultural and other commodities. Bank has
joined NCDEX as a business associate and is empanelled as a clearing bank. The
functions are being handled through the Stock Exchange Branch. Bank also
extends DP services to the traders/members of NCDEX under NSDL and CDSL through
its DP offices. Bank expects to leverage the association for business
growth.
AS PER WEBSITE:
MANAGING DIRECTOR
Shri M. Balachandran took charge as the Chairman and Managing Director of Bank of India on
9th June 2005, prior to which he was Executive Director of the Bank.
Bank
of India is 100 year old and a Public Sector Bank with majority share holding
by Govt. of India, with 2622 branches in India and 23 branches/offices in 12
countries abroad with assets of value in excess of US$ 25 billion.
Shri
Balachandran joined Bank of Baroda as a Specialist Direct Recruit Officer in
1970 after completing his Masters degree in Science. Starting his career as a
Banker in the State of
He
is also credited with evolving Policies and Guidelines for enhancing the flow
of timely credit to activities identified as national priority, particularly
Agriculture, Rural Finance and SSI lending and has been associated with various
Committees of NABARD and IBA.
He
was the Chief Executive of Bank of Baroda's
He
was a Director of Indo Zambia Bank Limited, a joint venture in
Shri
Balachandran is also on the Managing Committee of Indian Bank's Association,
Governing Council member of Indian Institute of Banking and Finance and Reserve
Bank of
EXECUTIVE DIRECTOR
Shri
K.R. Kamath assumed the charge as the Executive Director on 19.05.2006 . Shri
Kamath was a General Manager in Corporation Bank since 2002, in charge of
Information Technology, Information Security, Management Information System and
Integrated Risk Management.
A
brilliant academician, Shri Kamath had secured "VI rank" in
He
was promoted to Executive cadre in 1994 and was posted as Regional Manager for
Collection And Payment Services (CAPS), a "Specialised Business Unit"
set up on an experimental basis by the Bank. Contribution of Shri Kamath in
building a strong team, spearheading the marketing activities of CAPS and
positioning CAPS as the flag ship product of the Bank, has earned him special
recognition.
During
his tenure in Information Technology Division in Corporation Bank, Shri Kamath
was responsible for 100% automation of the Branches, migration of about 88% of
business to Core Banking Solution, positioning the 900 strong ATM network of
the Bank, putting in place Wide Area Network of the Bank, introduction of
Internet Banking and implementing the Information Security System. During this
period, the Bank received various awards from IDRBT & IBA for the
technology lead of the Bank.
Shri
Kamath has secured various Corporate Awards instituted by the Bank such as,
Super Productivity Award, SOGian Award, Chairman's Club Membership and Regional
Leadership Award. He was also conferred with "Sanman Award" by Joint
Commissioner of Income Tax,
He
was one of the participants of the Technology Tour of US organised by TATA IBM
in the year 1997-98. Shri Kamath has undergone various training programmes
including workshop/seminars at IIM, Ahmedabad, IBA and BTC.
Known
for his conceptual clarity, communication skills and ability to build strong
result oriented teams, Shri Kamath has been one of the key members of the Team
that has conceptualised and initiated steps to implement Organisational
Transformation Project of Corporation Bank. With 29 years experience of working
in various capacities in Corporation Bank, he will now add strength to the Team
'Bank of India'.
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or anti-terrorism
sanction laws or whose assets were seized, blocked, frozen or ordered forfeited
for violation of money laundering or international anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No available
information exist that suggest that subject or any of its principals have been
formally charged or convicted by a competent governmental authority for any
financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.40.47 |
|
|
1 |
Rs.81.07 |
|
Euro |
1 |
Rs.56.17 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
72 |
This score serves as a reference to assess SC’s credit risk and
to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit consideration.
Capability to overcome financial difficulties seems comparatively below
average/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|