MIRA INFORM REPORT

Report Date :

27.07.2011

IDENTIFICATION DETAILS

Name :	THE SOUTH INDIAN BANK LIMITED
Registered Office :	SIB House, TB Road, Mission Quarters, Thrissur-680 001, Kerala
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	25.01.1929
Com. Reg. No.:	09-01017
Paid-up Capital :	Rs. 1130.065 Millions
CIN No.: [Company Identification No.]	L6519KL1929PLC001017
TAN No.: [Tax Deduction & Collection Account No.]	CHNTO1684E CHNT01436B TVDT00608G TVDT00562C CHNS00477B CHNT00701B CHNT00642F CHNT01435A
Legal Form :	Public Limited Liability company. Companies shares are listed on the stock exchange.
Line of Business :	Banking Services
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

A (68)

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	Large
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established and reputed bank having fine track. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments. The bank can be considered normal for business dealing at usual trade terms and conditions.

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – June 30, 2010

Country Name	Previous Rating (01.04.2010)	Current Rating (30.06.2010)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

LOCATIONS

Registered Office :	SIB House, TB Road, Mission Quarters, Thrissur-680 001, Kerala, India
Tel. No.:	91-487-2420020/2424101/2429333
Fax No.:	91-487-2442021/2442052/2442054
E-Mail :	sib@vsnl.com sibrotcr@vsnl.com head@southindianbank.com sbicorporate@sib.co.in head@sib.co.in
Website :	http://www.southindianbank.com

DIRECTORS

As On 31.03.2011

Name :	Mr. Amitabha Guha
Designation :	Chairman
Name :	Mr. Mohan E. Alapatt
Designation :	Director
Name :	Mr. K. Thomas Jacob
Designation :	Director
Date of Birth/Age :	57 Years
Qualification :	B.Sc., FCA, DISA (ICAI)
Name :	Mr. Paul Chalissey
Designation :	Director
Name :	Dr. N J Kurian
Designation :	Director
Name :	Mr. H. Suresh Prabhu
Designation :	Director
Date of Birth/Age :	61 Years
Qualification :	M.B.A. (Finance), M.A., C.A.I.I.B, P.G. Diploma in International Banking, Bank Management, Treasury Investment and Risk Management
Name :	Dr. V. A. Joseph
Designation :	Managing Director and Chief Executive Officer
Name :	Mr. Mathew L Chakola
Designation :	Director
Date of Birth/Age :	47 Years
Qualification :	Graduate
Name :	Mr. Jose Alapatt
Designation :	Director
Date of Birth/Age :	62 Years
Qualification :	B.Sc

KEY EXECUTIVES

Name :	Mr. Abraham Thariyan
Designation :	Executive Director
Name :	Mr. Cheryan Varkey
Designation :	Executive Director
Name :	Mr. M. S. Mani
Designation :	General Manager
Name :	Mr. N. V. Ignatius
Designation :	General Manager
Name :	Mr. Joseph George Kavalam
Designation :	General Manager
Name :	Mr. K. S. Krishnan
Designation :	General Manager
Name :	Mr. K. S. George
Designation :	General Manager
Name :	Mr. A. G. Varughese
Designation :	General Manager
Name :	Mr. P. J. Jacob
Designation :	Deputy General Manager
Name :	Mr. K. C. Francis
Designation :	Deputy General Manager
Name :	Mr. Roy Alex Vilangopara
Designation :	Deputy General Manager
Name :	Mr. C.J. Jose Mohan
Designation :	Deputy General Manager
Name :	Mr. Thomas Joseph K.
Designation :	Deputy General Manager
Name :	Mr. K. L. Baby
Designation :	Deputy General Manager
Name :	Mr. John Thomas
Designation :	Deputy General Manager
Name :	Mr. P. K. Kochanthony
Designation :	Deputy General Manager
Name :	Mr. Abraham K. George
Designation :	Deputy General Manager
Name :	Mr. C. T. Devis
Designation :	Deputy General Manager
Name :	Mr. T. J. Raphael
Designation :	Deputy General Manager
Name :	Mr. T. D. Devasia
Designation :	Deputy General Manager
Name :	Mr. K. S. Krishnan
Designation :	Chief Financial Officer and Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As On 30.06.2011

Category of Shareholder	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
(2) Foreign
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	24,542,946	2.17
Financial Institutions / Banks	40,974,120	3.63
Insurance Companies	42,825,090	3.79
Foreign Institutional Investors	438,314,122	38.79
Sub Total	546,656,278	48.37
(2) Non-Institutions
Bodies Corporate	100,703,973	8.91
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 million	377,001,814	33.36
Individual shareholders holding nominal share capital in excess of Rs. 0.100 million	81,517,277	7.21
Any Others (Specify)	24,185,558	2.14
Trusts	15,440,442	1.37
Clearing Members	1,973,238	0.17
Hindu Undivided Families	6,771,878	0.60
Sub Total	583,408,622	51.63
Total Public shareholding (B)	1,130,064,900	100.00
Total (A)+(B)	1,130,064,900	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	-	-
(1) Promoter and Promoter Group	-	-
(2) Public	-	-
Sub Total	-	-
Total (A)+(B)+(C)	1,130,064,900	-

BUSINESS DETAILS

Line of Business :

Banking Services

GENERAL INFORMATION

No. of Employees :	Not Available
Bankers :	Not Available

Banking Relations :	-
Auditors :
Name :	Deloitte Haskins and Sells Chartered Accountants
Address :	7^th Floor, ASVN Ramana Tower, 52, Venkatnarayana Road, T. Nagar, Chennai - 600 017, Tamilnadu, India

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
125000000	Equity Shares	Rs.10/- each	Rs.1250.000 millions

Issued, Subscribed, Called Up & Paid-up Capital :

No. of Shares	Type	Value	Amount
113006490	Equity Shares	Rs.10/- each	Rs.1130.065 millions

Notes:

1) 22,60,12,980 Equity shares of Rs. 1/- each (Previous year 2,26,01,298 Equity shares of Rs. 10/- each) were issued as fully paid up bonus shares during the year 2008-09 by capitalisation of corresponding value from Share Premium Account.

2) The Face Value of the Equity Shares was subdivided from Rs. 10/- each into 10 (ten) Equity Shares of Rs. 1/- each w.e.f. 25.09.2010.

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

PARTICULARS	31.03.2011	31.03.2010	31.03.2009
CAPITAL AND LIABILITIES
Capital	1130.065	1130.065	1130.065
Employees Stock Options (Grants) Outstanding	21.228	5.745	0.000
Reserves and Surplus	17321.525	13717.089	11909.975
Deposits	297210.752	230115.241	180923.322
Borrowings	2903.468	3309.637	2570.104
Other liabilities and Provisions	9615.167	7062.669	7301.753
TOTAL	328202.205	255340.446	203835.219
ASSETS
Cash and Balances with Reserve Bank of India	18281.911	13909.488	9977.324
Balances with banks and money at call & short notice	6379.350	5967.239	10381.281
Investments	89237.722	71556.127	60752.032
Advances	204887.333	158229.174	118520.274
Fixed Assets	3568.444	1525.377	1363.188
Other Assets	5847.445	4153.041	2841.120
TOTAL	328202.205	255340.446	203835.219

PROFIT & LOSS ACCOUNT

PARTICULARS	31.03.2011	31.03.2010	31.03.2009
I. INCOME
Interest Earned	24460.166	19357.210	16869.219
Other Income	1966.940	2084.602	1642.717
TOTAL	26427.106	21441.812	18511.936
II. EXPENDITURE
Interest Expended	16549.152	13674.284	11640.380
Operating Expenses	4625.323	3661.814	3284.769
Provisions & Contingencies	2326.990	1768.109	1639.261
TOTAL	23501.465	19104.207	16564.410
III. PROFIT/LOSS
Net Profit for the year	2925.641	2337.605	1947.526
Transfer from Revenue & Other Reserves	0.000	0.000	117.100
Transfer to Other Liabilities & Provisions	0.000	0.000	(117.100)
Transfer from Investment Reserve	46.938	0.000	0.000
Profit brought forward from previous year	170.334	146.670	90.779
APPROPRIATIONS
Transfer to Statutory Reserves	731.500	584.500	490.000
Transfer to Capital Reserves	0.000	6.873	5.000
Transfer to Revenue and Other Reserves	1500.000	900.000	1000.000
Transfer to Investment Reserve	0.000	202.666	0.000
Transfer to Special Reserve u/s 36(i)(viii) of Income Tax Act	70.000	92.800	0.000
Proposed Dividend	565.033	452.026	339.019
Tax on Proposed Dividend	91.663	75.076	57.616
Balance carried over to Balance Sheet	184.717	170.334	146.670
TOTAL	3142.913	2484275	2038.305
Significant Accounting Policies Notes forming part of Accounts
Earning per share (Basic) (in Rs.)	2.59	2.07	17.23
Earning per share (Diluted) (in Rs.)	2.58	2.06	17.23

QUARTERLY RESULTS

PARTICULARS	30.06.2011 1^st Quarter
Interest Earned	7687.200
Income On Investments	1440.400
Interest On Balances With Rbi Other Inter Bank Funds	147.000
Interest / Discount On Advances / Bills	6099.800
Other Income	516.300
Total Income	8203.500
Interest Expended	5637.500
Operating Expenses	1134.600
Total Expenditure	1134.600
Operating Profit Before Provisions and Contingencies	1431.400
Provisions and contingencies	208.400
Profit Before Tax	1223.000
Tax	398.100
Profit After Tax	824.900
Net Profit	824.90

LOCAL AGENCY FURTHER INFORMATION

Company History:-

One of the earliest banks in South India, Subject o being during the Swadeshi movement. It was incorporated on 01.03.1928 by the fulfillment of the dreams of a group of enterprising men who joined together at Thrissur to provide the people a safe, efficient and service oriented repository of savings of the community on one hand and to free the business community from the clutches of greedy money lenders on the other by providing need based credit at reasonable rates of interest. Now the bank accounts about the network of 520 branches, 17 extension counters and 260 ATMs. Through all, the bank serves the services under the areas of Accounts/Deposits, Loans, Mutual Funds, Insurance, Money Transfers and some other value added services. The first branch outside Kerala was opened by the bank in Coimbatore during the year 1941. SIB, the first among the private sector banks in Kerala to become a scheduled bank in 1946 under the RBI Act. During the year 1963, the bank took over the assets and liabilities of Kshemavilasam Banking Company Limited and the Ambat Bank Private Limited, Chittur, Kerala. The year 1964 was notable one in the saga of SIB; the bank had acquired ten banks in the single year of 1964 itself, the list of banks include Public Bank Limited, Suburban Bank Private Limited, Vijalakshmi Bank Private Limited, Chalakudy Bank Limited, Mukkattukara Catholic Bank Limited, Assyrian Charities Banking Company Limited, The Catholic Syrian Christian Bank Limited, Malabar Bank Limited, Bharata Union Bank Limited and Kozhuvanal Bank Limited. SIB made its entry into merchant banking activities by supporting/underwriting 99 new issues in the year 1990. A Currency Chest activity of the bank on behalf of the RBI was started to execute in April of the year 1992. Also during the same year of 1992, SIB unlocked a NRI branch in November and developed an in-house, a fully integrated branch automation software in addition to the in-house partial automation solution operational. During the year 1993, the bank started an Industrial Finance Branch in the month of March and opened an 'Overseas Branch' to cater exclusively to the export and import business in June of the same year 1993. Initial Public Offering of the bank was made and went to public in the year 1998. The Sibertech (Technology Promotion Drive of South Indian Bank) project, a comprehensive and centralized banking solution was launched by the bank in 2001 and also SIB entered into alliance with three exchange houses in the Gulf during the identical year of 2001. A tie-up was made by the bank with insurance player in the year 2002 for the distribution of the products of the insurance company. The internet banking facility, namely Sibernet was introduced by the bank to its customers in the year 2003 and also made an agreement with Master Card International to launch Maestro, the Global ATM/Debit Card. During the year 2004, the bank had celebrated 75 years of its existence. The Follow on Public Offering of the company was made in the year 2005. The Bank won a special award for excellence in Banking Technology from IDRBT (Institute for Development and Research in Banking Technology) in September of the year 2006. The bank has achieved 100% Core Banking Solutions by 24th March of the year 2007. Further to strengthen the ATM reach and global acceptability Bank has introduced Master Card Global Debit- cum- ATM card, which can be used at ATMs and merchandise all over the world. SIB has emerged as the Best Performer in Asset Quality category in Analyst 2008 Survey of Indian Banks among private sector banks which include both the new generation and the traditional banks in India.

FINANCIAL PERFORMANCE

PROFIT

The Bank has achieved a record net profit of Rs. 2925.600 Millions during the year registering a growth of 25.15% over the previous year. The Bank could achieve this quantitative enhancement in net profit essentially on account of higher scale of operations and better management of assets and liabilities of the Bank. The Profit and Loss Account shows an Operating Profit of Rs. 5480.800 Millions before depreciation, tax and provision

EXPANSION PROGRAMME / POLICY OF THE BANK

During the year, the Bank opened 61 new branches and 116 ATMs across the country. The Bank has been successful in widening its coverage across the country with 641 branches and 3 extension counters transforming it to a pan Indian Institution. The branch network now covers 26 states/union territories and has a network of 489 ATMs. The Bank plans to open more new branches and ATMs in the current financial year so as to reach the corporate goal of 700 Branches and 600 ATMs by 31.03.2012.

BUSINESS ACHIEVEMENTS:-

The Bank could achieve a total gross business of Rs. 503800.000 Millions, consisting of total deposit of Rs. 297210.000 Millions and gross advances of Rs. 206590.000 Millions as on 31.03.2011 registering a growth of 29.24% over the previous year. In CASA segment, the Bank has achieved a year to year growth of 20%.

During the year 2010-11, 7.51 Lakh new SB A/cs were opened, of which, 2.82 Lakh accounts belong to students. This was specifically aimed at inculcating banking and savings habit among the younger generation.

INVESTMENTS

Indian economy has continued its broad based growth during the financial year 2010-11 registering an impressive GDP growth rate. But the inflationary pressures persisted both from domestic demand and higher global commodity prices on account of gradual global recovery from financial crisis witnessed in the past years. RBI has moved, in a calibrated manner, in the direction of normalizing the policy prescriptions. Repo and Reverse Repo rates were hiked 175 and 225 basis points respectively. SLR was reduced to 24% from 25% and CRR has been increased from 5.75% to 6.00%. The monetary policy initiatives were intended to moderate inflation by controlling demand pressures and inflationary expectations, creation of a macro environment conducive to sustainable growth, to generate liquidity environment consistent with more effective transmission of policy actions and to reduce the volatility of short-term rates in a narrower corridor. Liquidity in the system got tightened sporadically during the year under review, especially after the 3G / Broad band auctions held in June, 2010. The borrowing under Repo has occasionally crossed 1% of NDTL which was within the comfort level of RBI. The interest rates have risen due to the liquidity tightness and peaked in March 2011. This resulted in pushing up the cost of deposits.

COMPLIANCE WITH BASEL II FRAMEWORK

The Bank has migrated to Basel II norms during Financial Year 2008-09. In tune with regulatory guidelines on Pillar I of Basel II norms, Bank has computed capital charge for credit risk as per the Standardized Approach, for market risk as per the Standardized Duration Method and for operational risk as per the Basic Indicator Approach. To address the issues of Pillar II, the Bank has implemented ICAAP (Internal Capital Adequacy Assessment Process) during the year integrating capital planning with budgetary planning and to capture residual risks which are not addressed in Pillar I like credit concentration risk, interest rate risk in the banking book, liquidity risk, earnings risk, strategic risk, reputation risk etc. Bank has adopted a common framework for additional disclosures under Pillar III for adhering to market discipline of Basel II guidelines. This requires the Bank to disclose its risk exposures, risk assessment processes and its capital adequacy to the market in a more consistent and comprehensive manner.

INTERNATIONAL BANKING

In its quest for providing quality and hassle free service to the NRI clientele, the Bank has introduced two new products. The Bank has successfully implemented online remittance facility with M/s. UAE Exchange Centre, Abu Dhabi on Real time basis. This will ensure immediate credit to Bank’s customers, with a unique feature of informing the beneficiaries and remitter through SMS within 60 seconds of remittance, branded as SIB Flash. Another product branded “SIB eazyRemit” was launched, to provide online cross border remittance in USD that facilitates a remitter in US to transfer funds to India online, using the internet platform, at a nominal cost, in association with M/s. Bank of New York Mellon. This facility has been extended to other bank customers as well.

The Bank has entered into MTSS sub-agency arrangement with M/s. Weizmann Forex Limited towards payment of inward remittances under Western Union Money transfer scheme. With an objective to provide remittance facilities to NRIs in the gulf, the Bank had entered into Speed Remittance arrangement (SIB Express) with 4 more Exchange Houses in the current fiscal viz. M/s Delma Exchange, AbuDhabi, M/s Muthoot Exchange, Dubai, M/s Alamoudi Exchange, Saudi Arabia and M/s Al Dar For Exchange Works, Doha, Qatar. At present the Bank is having inward remittance arrangement with 4 banks and 31 Exchange Houses.

The Bank continued providing managerial support to Hadi Express Exchange, UAE, with four branches. The Bank had also set up a stall in Global Village Dubai, in connection with Dubai Shopping Festival 2011.

RBI has authorized the Bank as a nominated agency for import of gold. The Bank is on the verge of launching the product “SIB Pure Gold”. The product offers different denominations of pure gold coins, with a fineness of ‘999.9’.

To improve forex business turnover of the Bank, the Bank has received necessary approvals for upgrading 7 more branches to “B” category, bringing the total number of “B” category branches to 32.

NRI PORTFOLIO

The Bank has the unique distinction of opening the first exclusive NRI branch in Kerala and still occupies the prime position with 8 exclusive NRI branches in the state. The total NRI deposit of the Bank as on 31.03.2011 constitutes 19.50 % of the Bank’s total retail deposit.

The NRI Division of the Bank has since been strengthened to provide dedicated service to the Bank’s NRI Customers. The Division is also offering WELCOME KIT-Centralized NRI Account Opening facility through Hadi Express Exchange to increase the customer base in UAE. The Division also extends support to the branches in their NRI related matters and closely monitor the growth of NRI business. NRI Newsletter, a quarterly publication from NRI Division continues to provide useful information to the Bank’s NRI Customers.

TRAINING

The Bank accords utmost importance to human resources development. Training programmes are conducted in SIB Staff Training College (SIBSTC), Thrissur and at 7 Regional Training Centers (RTCs) at ROs for enhancement of professional capabilities of the staff. The training programmes are designed to impart knowledge as well as catalyzing a positive attitudinal change in the participants. The improvements made in human resources has reflected in enhancement of organizational productivity. SIBSTC and the RTCs identify gaps in skill of the personnel and provide learning to them for qualitative improvement. During the year 2010-11, the Bank imparted training to 1272 officers, 990 clerks and 285 sub staff in various aspects of banking operations. Thus, the Bank could provide training to a total of 2547 of its personnel, which is about 45 percent of total staff strength of 5619 as on 31.03.2011. This is in consonance with the Bank’s vision towards continuous up-gradation of skills to ensure that the staff members meet the rising expectations of customers and discharge services professionally covering the entire gamut of banking operations.

MARKETING

The Bank has embedded its marketing strategies to ensure all round business growth and to counter the competitiveness in the market. An array of products and services were introduced keeping in view customer’s preferences and as a result, the Bank was able to live up to their expectations. This exercise has helped the Bank to design each customer contact point as easy and result oriented as possible. The Bank has leveraged on the Core Banking platform to offer varied financial products and services in a seamless and effective manner.

ANY BRANCH BANKING

The Bank offers a wide range of SB & CD products with Any Branch Banking facility to suit the needs of various customer segments. Through Real Time Gross Settlement / National Electronic Fund Transfer (RTGS / NEFT), customers can transfer/ receive funds to/from accounts with any other bank in India, who are the members of this payment system. Customers can also send /receive funds to /from abroad through various online realtime remittance facilities provided by the Bank. The new products launched by the Bank such as SIB-Mahila, Youth Plus etc. caters to specific segments of the customer base. The products have been well received by the customers.

INTERNET BANKING

‘SIBerNet’ - the internet banking service of the Bank, facilitates online and any-time banking transactions. During the year, the Bank had launched the facility of RTGS/NEFT for the Bank’s internet banking customers to transfer the funds to any other bank accounts in India. In addition to the existing arrangements with the three leading online payment aggregators viz., BillDesk, TechProcess and CCAvenues, the Bank has now made arrangements with M/s. Times Of Money Limited (TOML) and M/s. ATOM Technologies Limited to facilitate online transaction for the internet banking customers. During the year, bank had also made arrangements with the temples like Attukal Bhagavathi temple, Trivandrum and Sree Padmanabha Swamy temple,Trivandrum, to facilitate online offerings/donations for the internet banking customers. This is in addition to the existing arrangement with Guruvayur Sree Krishna temple in Kerala.

MOBILE BANKING

Customers of the Bank enjoy the benefit of Mobile Banking Service wherein, transaction alerts are sent to the customers (including NRIs) on a real time basis, using SMS technology. Last year, the Bank had launched M-Commerce facility as a value added service in association with M/s. Paymate. M-commerce is an entirely new breed of secured payment channel, which ensures online and real time payments by debit to the customer’s bank account which is authenticated through the registered mobile phone number of the customer. Facilities like account based fund transfer, utility bill payments, online recharge etc. are also made available using this facility. The Bank is in the final stage of implementing Interbank Mobile Payment Service (IMPS). IMPS offer an instant, 24X7, interbank electronic fund transfer service through mobile phones.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Economic Scenario

The growth story of the Indian Economy has been maintained and it is estimated to have grown by 8.6 percent during the financial year 2010-11. A good monsoon has lead to a healthy contribution by agricultural sector. The food grain production in 2010-11 is estimated to be the highest ever, surpassing the previous peak achieved in 2008-09. Admist the calibrated initiatives of the Central Bank to contain inflation, the index of industrial production (IIP) has recorded an overall growth of 7.8 % for the financial year. The services sector has continued its growth momentum. There has been a surge in credit flow to this sector from 12.5 % in the previous year to 24% in the current year. Other indicators like tax collections, corporate sales and earnings growth and export performance reflect strong economic activities during the year.

Like in many other emerging market economies, inflation was the primary macroeconomic concern of the Indian economy throughout the financial year. From an inflation driven primarily by food items at the beginning of the financial year, it has become more generic in nature by 2nd and 3rd quarter. Monetary policy of the Central Bank throughout the year directed its efforts to contain inflation without affecting the growth momentum. The policy decisions of the Reserve Bank of India did moderate the inflation in the first three quarters of the financial year. However, the last quarter witnessed the rate of inflation rising due to surge in international commodity prices. In response to the same, RBI in its Annual Monetary Policy for 2011-12 abandoned the “calibrated step by step approach” and hiked the key rates by 50 bps as it feels, over the long run, high inflation is inimical to sustained growth and it has to be contained even if it meant subdued growth in the short run.

Reflecting several macroeconomic uncertainties, Indian Equity markets underachieved and remained volatile during the 4^th quarter of 2010-11 in specific. The activity in the primary segment of the domestic capital market remained buoyant during the first three quarters of 2010-11, moderated during the 4th quarter.

Banking Scenario

Admist Central Bank’s effort to contain inflation by moderating the liquidity level, the data on sectoral deployment of bank credit show significant increases in credit flow to industry and services. Credit flows improved in respect of metals, textiles, engineering, food processing, and gems and jewellery, among others. Non-food credit growth, which had been trending upwards from the beginning of the year, reached an intrayear high of 24.2 per cent (year on year) in December 2010. It slowed down subsequently to 21.2 per cent by March 2011, which was marginally higher than the Reserve Bank’s projection of 20 per cent. Broad money supply (M3) growth at 15.9 per cent (year on year) during 2010-11 was lower than the Reserve Bank’s indicative level of 17 per cent. This is attributable to slow deposit growth and acceleration in currency growth.

Interest rates firmed up responding to monetary policy signals. Banks progressively passed on the increased costs in the form of higher lending rates. Deposit growth which lagged behind the credit expansion, picked up in the 4th quarter of 2010-11, responding to the rise in interest rates. Base rate system replaced the Benchmark Prime Lending Rate (BPLR) mechanism w.e.f. 01.07 2010. This is a significant development to usher in transparency in pricing loan products. Data from select Banks indicate that the weighted average yield on advances, which is a proxy measure for effective lending rates, is projected to increase from 9.7 per cent in 2010-11 to 10.3 per cent in 2011-12.

Economic and Banking Outlook

The growth momentum witnessed in 2010-11 may get moderated in 2011-12 due to the anti-inflationary monetary stance of Reserve Bank of India. The Meteorological Department has indicated a normal monsoon for the year 2011. Expected significant increases in the outputs of key agricultural products should help to neutralize high prices of essential commodities. Agro-based industries could benefit from higher agricultural growth. The Central Bank has placed the baseline projection of real GDP Growth for 2011-12 in range of 7.4 per cent and 8.5 per cent with 90 per cent probability.

Against the backdrop of the domestic demand-supply balance and the global trends in commodity prices and the likely demand scenario, the baseline projection for Wholesale Price Index (WPI) inflation for March 2012 is placed at 6 per cent with an upward bias. Inflation is expected to remain at an elevated level in the first half of the year due to expected pass through of increase in international petroleum product prices to domestic prices and continued pass-through of high input prices into manufactured products.

With the overall economy expected to grow at around 8.6% for FY 11, services and industry expected to grow at a faster pace of around 10.3% and 9.5% respectively, bank credit is expected to grow at a healthy pace. Aggregate deposits and non-food credit of scheduled commercial banks are projected to grow by 17 and 19 per cent respectively for the year 2011-12. The broad stance of the monetary policy of the Reserve Bank is intended to :

• Maintain an interest rate environment that moderates inflation and anchors inflation expectations
• Foster an environment of price stability that is conducive to sustaining growth in the medium-term coupled with financial stability
• Manage liquidity to ensure that it remains broadly in balance, with neither a large surplus diluting monetary transmission nor a large deficit choking off flow of funds to productive sectors.

Financial Performance Vs Operational Performance

During the financial year under reporting, Net Profit reached the level of Rs. 2925.600 Millions as against Rs. 2337.600 Millions last year. The total gross business of the Bank grew from Rs. 389820.000 Millions to Rs. 503800.000 Millions. While the deposits grew from Rs. 230120.000 Millions to Rs. 297210.000 Millions, gross advances grew from Rs. 159700.000 Millions to Rs. 206590.000 Millions. Food credit increased to Rs. 3620.200 Millions from Rs. 2858.900 Millions and non-food credit stood at Rs. 202967.700 Millions vis-à-vis Rs. 156841.600 Millions in the last year, posting an increase of Rs. 46890.000 Millions. The Board has recommended a dividend of 50% i. e. @ Rs. 0.50 per equity share of Rs. 1/- each, which is subject to approval of the shareholders.

The percentage of Gross NPA to Gross Advances stood at 1.11% and the Net NPA to Net Advances at 0.29% respectively as on 31.03.2011. The Capital Adequacy Ratio of the Bank was 13.17% under Basel I and 14.01% under Basel II norms as on 31.03.2011 as against the RBI mandated level of 9%. Book value per share rose from Rs. 13.14 to Rs. 16.33 during the year 2010-11

CONTINGENT LIABILITIES (As On 31.03.2011)

Rs. In Millions

I. Claims against the Bank not acknowledged as debts:
(i) Income Tax disputes	1160.500
(ii) Service Tax disputes	22.370
(iii) FERA disputes	--
(iv) Others	37.756
II. Liability on account of outstanding Forward Exchange Contracts	8784.798
III. Guarantees given on behalf of constituents in India	8475.424
IV. Acceptances, endorsements and other obligations	5734.949
V. Other items for which the bank is contingently liable: Unexpired Capital Commitments	103.984
Total	24319.781

FINANCIAL RESULTS FOR THE THREE MONTHS ENDED 30.06.2011

(Rs. in millions)

Particulars	3 months ended 30.06.2011 Unaudited
1. Interest earned (a) + (b) + (c) + (d)	7687.200
(a) Interest/discount on advances/bills	6099.800
(b) Income on investments	1440.400
(c) Interest on balances with Reserve Bank of India and other inter-bank funds	147.000
(d) Others	-
2. Other Income	516.300
3. Total income (1+2)	8203.500
4. Interest expended	5637.500
5. Operating Expenses (i) + (ii)	1134.600
(i) Employees cost	690.400
(ii) Other operating expenses	444.200
6. Total expenditure (4)+ (5) excluding provisions & contingencies	6772.100
7. Operating Profit before provisions and contingencies (3) - (6)	1431.400
8. Provisions (other than tax) and contingencies	208.400
9. Exceptional Items	-
10. Profit from Ordinary Activities before tax (7)-(8)-(9)	1223.000
11.Tax expense - Current Tax	443.500
- Deferred Tax	(45.400)
12.Net Profit from Ordinary Activities after tax (10)-(11)	824.900
13. Extra ordinary items (Net of Tax Expense)	--
14. Net Profit for the period (12+13)	824.900
15. Paid up Equity Share Capital (Face Value Rs. 1)	1130.100
16. Reserves excluding revaluation reserves
17. Analytical Ratios
i) Percentage of shares held by Goverment of India	Nil
ii) Capital Adequacy Ratio (%) a) BASEL I	12.36
b) BASEL II	13.51
(a) Basic EPS - before and after Extraordinary items (Rs.)	0.73*
(b) Diluted EPS - before and after Extraordinary items (Rs.)	0.73*
iv) NPA Ratios (a) Gross NPA	2364.300
Net NPA	634.900
(b) % of Gross NPA	1.07
% of Net NPA	0.29
v) Return on Assets (Annualised)	1.02
18. Public Shareholding
- No.of Shares (in lakhs)	11301
- Percentage of shareholding	100%
19. Promoters and promoter group shareholding
(a) Pledged/ Encumbered
- Number of shares	NIL
- Percentage of shares[as a % of the total
shareholding of promoter and promoter group]	NIL
- Percentage of shares [as a % of the total
share capital of the company]	NIL
(b) Non Encumbered
- Number of shares	NIL
- Percentage of shares[as a % of the total
shareholding of promoter and promoter group]	NIL
- Percentage of shares [as a % of the total
share capital of the company]	NIL

  * Not annualised

SEGMENTWISE RESULTS

Rs. In Millions

1. Segment Revenue	3 months ended 30.06.2011 Unaudited
a) Treasury	1789.300
b) Corporate/ Wholesale Banking	2880.300
c) Retail Banking	3452.300
d) Other Banking Operations	81.600
Total	8203.500
Less : Inter segment Revenue	-
Net Income from Operations	8203.500
2. Segment Results
Profit(+)/Loss (-) before tax and after interest from each segment
a) Treasury	(146.400)
b) Corporate/ Wholesale Banking	421.600
c) Retail Banking	880.900
d) Other Banking Operations	66.900
Total	1223.000
Less: unallocated expenditure	-
Profit Before Tax	1223.000
3.Capital Employed
a) Treasury	90205.700
b) Corporate/ Wholesale Banking	108262.600
c) Retail Banking	110026.300
d) Other Banking Operations	-
Total	308494.600

Notes:

1. The above financial results for the three months ended 30.06.2011 reviewed by the Audit Committee of the Board have been approved by the Board of Directors at their meeting held on 14.07.2011 and subjected to limited review by Statutory Central Auditors.
2. The financial results have been arrived at after providing for Standard/Non performing assets as per RBI norms, Taxes and other necessary provisions.
3. Pursuant to the approval of the Shareholders at the 82^nd Annual General Meeting held on 14.07.2010, the face value of the equity shares of the Bank was sub-divided from Rs. 10 each into 10(Ten) Equity Shares of Rs. 1each with effect from 25.09.2010. Accordingly, the number of shares and the Earnings Per Share of the previous period has been restated to make the same comparable.
4. Disputed Income Tax Liabilities amounting to Rs. 1102.800 millions for the assessed years and likely liability of Rs. 57.700 millions forum assessed years have been treated as Contingent Liability, since the disputed issues are pending before the Supreme Court.
5. An amount of Rs. 78.300 millions, being the proportionate amount of unamortized liability towards gratuity and pension benefits of employees carried over from previous year as per RBI circular No DBOB No.BP.BC.80/21.01.018/2010-11 dated 09.02.2011, and made applicable to the bank vide DBOD No.BP.BC.15896/21.04.018/2010-11 dated 08.04.2011 has been written off during the quarter.The balance unamortized amount carried forward is Rs. 1173.900 millions. Current liability towards retirement benefits estimated at Rs. 66.700 millions has also been charged to revenue.
6. Details of Investor complaints received and disposed off:

Complaints at the beginning of the quarter	Received during the Quarter	Redressed during the Quarter	Unresolved at the end of the quarter
0	17	17	0

7. Previous period's/year's figures have been regrouped, wherever necessary to conform to the current period's classification.

AS PER WEBSITE DETAILS

PROFILE:

Building Blocks

One of the earliest banks in South India, Subject came into being during the Swadeshi movement. The establishment of the bank was the fulfillment of the dreams of a group of enterprising men who joined together at Thrissur, a major town (now known as the Cultural Capital of Kerala), in the erstwhile State of Cochin to provide for the people a safe, efficient and service oriented repository of savings of the community on one hand and to free the business community from the clutches of greedy money lenders on the other by providing need based credit at reasonable rates of interest.

Translating the vision of the founding fathers as its corporate mission, the bank has during its long sojourn been able to project itself as a vibrant, fast growing, service oriented and trend setting financial intermediary.

Milestones

· The FIRST among the private sector banks in Kerala to become a scheduled bank in 1946 under the RBI Act.

· The FIRST bank in the private sector in India to open a Currency Chest on behalf of the RBI in April 1992.

· The FIRST private sector bank to open a NRI branch in November 1992. 

· The FIRST bank in the private sector to start an Industrial Finance Branch in March 1993.

· The FIRST among the private sector banks in Kerala to open an "Overseas Branch" to cater exclusively to the export and import business in June 1993.

· The FIRST bank in Kerala to develop an in-house, a fully integrated branch automation software in addition to the in-house partial automation solution operational since 1992.

· The FIRST Kerala based bank to implement Core Banking System.

· The THIRD largest branch network among Private Sector banks, in India, with all its branches under Core banking System.

Future Perfect

The Subject with a new logo and image, marches on. With branches all over India and a clientele across the world, the bank is considered one of the most pro active banks in India with a competent tech savvy team of professional at the core of services.

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No records 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.44.29
UK Pound	1	Rs.72.37
Euro	1	Rs.64.17

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	8
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	7
--RESERVES	1~10	8
--CREDIT LINES	1~10	7
--MARGINS	-5~5	-
DEMERIT POINTS
--BANK CHARGES	YES/NO	NO
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		68

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	Capability to overcome financial difficulties seems comparatively below average.	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
-	NB	New Business	-

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.