MIRA INFORM REPORT

Report Date :

15.02.2012

IDENTIFICATION DETAILS

Name :	LAKSHMI VILAS BANK LIMITED
Registered Office :	Salem Road, Kathaparai, Karur – 639006, Tamilnadu
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	03.11.1926
Com. Reg. No.:	18-001377
Capital Investment / Paid-up Capital :	Rs.975.258 Millions
CIN No.: [Company Identification No.]	L65110TN1926PLC001377
TAN No.: [Tax Deduction & Collection Account No.]	CMBL03231E CMBL03229C MRIL00122D MRIL00120B MRIL00118G MRIL00117F
Legal Form :	It is a Commercial Bank.
Line of Business :	Subject is engaged in Banking Business.
No. of Employees :	2626 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (60)

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 :	USD 35700000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established bank having fine track. Financial position of the company appears to be sound. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments. The bank can be considered good for normal business dealings 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 – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
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/ Administrative Office :	Salem Road, Kathaparai, Karur – 639006, Tamilnadu, India
Tel. No.:	91-4324-220051 to 220060 (10 Lines)
Fax No.:	91-4324-220068/ 220069
E-Mail :	secretarial@lvbank.in
Website :	www.lvbank.com
Branch Office :	74, Cathedral Road, Chennai – 600086, Tamilnadu, India
Regional Offices :	Located at : · Bengaluru · Chennai · Coimbatore · Mumbai · Madurai · Karur · Gurgaon · Hyderabad

DIRECTORS

As on 31.03.2011

Name :	Mr. S. Narayan
Designation :	Non-Executive Chairman (Till 27.01.2011)
Name :	Mr. K.S.R. Anjaneyulu
Designation :	Managing Director and Chie Executive Officer (Till 02.08.2010)
Name :	Mr. P.R. Somasundaram
Designation :	Managing Director and Chief Executive Officer (From 02.08.2010)
Name :	Mr. K. Balaji
Designation :	Director (Till 19.07.2011)
Name :	Mr. N. Saiprasad
Designation :	Director
Name :	Mr. K. Ravindrakumar
Designation :	Director
Name :	Mr. Kusuma R Muniraju
Designation :	Director
Name :	Mr. D.L.N. Rao
Designation :	Director
Name :	Mr. B.K. Manjunath
Designation :	Director
Name :	Mr. K.R. Pradeep
Designation :	Director
Name :	Mr. S.G. Prabhakharan
Designation :	Director
Name :	Mr. S. Dattathreyan
Designation :	Director
Name :	Mr. V. Prakash
Designation :	Executive Director
Name :	Mr. Rajat Baldhi
Designation :	Executive Director

KEY EXECUTIVES

Name :	Mr. M. Palaniappan
Designation :	Chief Financial Officer
Name :	Mr. B. Murali Nair
Designation :	Chief Technology Officer
Name :	Mr. S.R. Narayanamurthy
Designation :	General Manager
Name :	Mr. S. Ravishankar
Designation :	General Manager
Name :	Mr. T. N. Sundaram
Designation :	General Manager
Name :	Mr. V. Sudarsan
Designation :	General Manager
Name :	Mr. Niranjan K Rao
Designation :	General Manager
Name :	Mr. J. V. S. Chetty
Designation :	General Manager
Name :	Mr. S. Suresh Babu
Designation :	General Manager
Name :	Mr. Raghu Nagarajan
Designation :	General Manager
Name :	Mr. S. Venkateswaran
Designation :	General Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 31.12.2011

Names of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	2706796	2.78
Bodies Corporate	8557569	8.77
Sub Total	11264365	11.55
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	11264365	11.55
(B) Public Shareholding
(1) Institutions
Financial Institutions / Banks	7472600	7.66
Insurance Companies	488550	0.50
Foreign Institutional Investors	11183097	11.47
Sub Total	19144247	19.63
(2) Non-Institutions
Bodies Corporate	12042745	12.35
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 Million	32806955	33.64
Individual shareholders holding nominal share capital in excess of Rs.0.100 Million	21479217	22.02
Any Others (Specify)	788311	0.81
Clearing Members	784911	0.80
Trusts	3400	--
Sub Total	67117228	68.82
Total Public shareholding (B)	86261475	88.45
Total (A)+(B)	97525840	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)	97525840	--

BUSINESS DETAILS

Line of Business :	Subject is engaged in Banking Business.
Products :	Banking Company

GENERAL INFORMATION

No. of Employees :	2626 (Approximately)
Bankers :	Reserve Bank of India

Banking Relations :	--
Auditors :
Name :	Sagar and Associates Chartered Accountants
Address :	Hyderabad, Andhra Pradesh, India

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
150000000	Equity Shares	Rs.10/- each	Rs.1500.000 Millions

Issued Capital :

No. of Shares	Type	Value	Amount
98352564	Equity Shares	Rs.10/- each	Rs.983.525 Millions

Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
97525840	Equity Shares	Rs.10/- each	Rs.975.258 Millions

Note:

i) 97525840 Paid-up Capital

ii) 12641186 Bonus Shares allotted

iii) Shares kept in abeyance 803066 - Released Bonus Shares 50 and Rights Shares 16,994 during the year 2010-2011

iv) Shares Forfieted and lapsed 23658 so far

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2011	31.03.2010	31.03.2009
I. CAPITAL & LIABILITIES
a. Capital	975.258	975.088	487.762
b. Reserves & Surplus	7949.091	6414.886	4049.397
c. Deposits	111495.107	90753.777	73609.030
d. Borrowings	7251.070	3339.349	1426.043
e. Other Liabilities & Provisions	5341.304	3379.605	3504.164
TOTAL	133011.830	104862.705	83076.396
II. ASSETS
a. Cash & Balances with Reserve Bank of India	9436.053	7508.270	5919.652
b. Balances with Banks and Money at Call & Short Notice	829.554	829.639	2894.479
c. Investments	35188.503	29832.223	18630.562
d. Advances	80944.228	62774.952	52362.138
e. Fixed Assets	1791.314	656.707	539.798
f. Others	4822.178	3260.914	2729.767
TOTAL	133011.830	104862.705	83076.396

PROFIT & LOSS ACCOUNT

PARTICULARS	31.03.2011	31.03.2010	31.03.2009
I. INCOME
a. Interest Income	10648.355	9093.240	6576.111
b. Other Income	1370.159	1035.570	1069.893
TOTAL	12018.514	10128.810	7646.004
II. EXPENDITURE
a. Interest Expended	6998.444	6601.938	5040.718
b. Operating Expenses	2281.482	1864.779	1516.869
c. Provision & Contingencies	1727.220	1355.413	585.464
TOTAL	11007.146	9822.130	7143.051
III. NET PROFIT FOR THE YEAR	1011.368	306.680	502.953
a. Excess Dividend Provided- Reserved	0.026	0.000	0.000
b. Profit brought forward	1.563	2.884	2.963
TOTAL	1012.957	309.564	505.916
IV. APPROPRIATIONS
a. Transfer to Statutory Reserve	260.000	100.000	152.500
b. Transfer to Capital Reserve	12.716	6.632	187.855
c. Transfer to Other Reserves	402.500	123.147	10.000
d. Transfer to Special Reserve u/s 36(1) (viii) of the IT Act, 1961	50.000	10.000	10.000
e. Proposed Dividend	243.815	58.505	121.950
f. Tax on Proposed Dividend	41.436	9.717	20.727
g. Balance carried over to Balance Sheet	2.490	1.563	2.884
TOTAL	1012.957	309.564	505.916
Earnings Per Share (Rs.)	10.37	4.95	10.31

QUARTERLY RESULTS

PARTICULARS	30.06.2011 1^st Quarter	30.09.2011 2^nd Quarter	31.12.2011 3^rd Quarter
	UnAudited	UnAudited	UnAudited
Interest Earned	3357.670	3801.090	3942.710
Income On Investments	675.780	841.420	873.760
Interest On Balances With RBI Other Inter Bank Funds	4.760	14.560	17.050
Interest / Discount On Advances / Bills	2677.130	2945.110	3048.790
Others	0.000	0.000	3.110
Other Income	341.710	313.910	352.210
Total Income	3699.380	4115.000	4294.910
Interest Expended	2425.060	2833.530	3036.550
Operating Expenses	577.350	665.070	777.270
Total Expenditure	577.350	665.070	777.270
Operating Profit Before Provisions And Contingencies	696.970	616.390	481.090
Exceptional Items	0.000	0.000	0.000
Provisions And Contingencies	401.130	245.170	187.560
Profit Before Tax	295.840	371.230	293.540
Tax	50.000	80.000	10.000
Profit After Tax	245.840	291.230	283.540
+/- Extraordinary Items	0.000	0.000	0.000
+/- Prior period items	0.000	0.000	0.000
Net Profit	245.840	291.230	283.540

LOCAL AGENCY FURTHER INFORMATION

FINANCIAL PERFORMANCE

The bank registered appreciable growth in business volumes that compares very favourably with the industry average. The Bank attained total business of Rs.19,2439.600 Millions in FY 2010-11, a growth of 25.35% over Rs.15,3528.800 Millions in FY 2009-10.

Deposits grew 23%, from Rs.90753.800 Millions as at 31st March 2010 to Rs.111495.100 Millions as at 31st March 2011, and total advances expanded by 29%, from Rs.62775.000 Millions to Rs.80944.200 Millions in FY 2010-11. Of this, lending to priority sector rose from Rs.21424.400 Millions in the previous year to Rs.26352.200 Millions as on 31st March 2011. Agricultural advances increased to Rs.11993.500 Millions from Rs.9802.600 Millions and advances to weaker section recorded a significant growth from Rs.5692.700 Millions to Rs.7350.200 Millions.

The Bank's exposures to sensitive sectors including Real Estate and Capital Market were maintained well within the regulatory limits.

NET OWNED FUNDS / CAPITAL ADEQUACY RATIO

Net Owned Funds (NOF) of the Bank increased from Rs.7389.900 Millions as at the end of FY 2009-10 to Rs.8117.000 Millions as at the end of FY 2010-11, reflecting a growth of 9.83%. During the year, the Bank revalued its fixed assets portfolio of owned properties and transferred an amount of Rs.807.300 Millions to Revaluation Reserve.

As on 31st March, 2011 the Bank's Capital Adequacy Ratio (CAR) stood at 13.19% (Basel-II), well above the regulatory minimum of 9.00%. Without considering the Revaluation Reserve, the CAR would be 12.70%.

The Tier-I and Tier-II components of Capital Adequacy Ratio were comfortable at 10.78% and 2.41% respectively.

INTERNATIONAL BUSINESS

During the year, the Bank achieved Foreign Exchange Business turnover of Rs.49005.800 Millions as against Rs.34624.300 Millions during the previous year registering a growth of 41.53%. Lending to export sector however, decreased from Rs.2742.800 Millions to Rs.2154.300 Millions, FY 2011-12 will see a refreshed approach to service clients on the export front and to substantially increase the Foreign Exchange volumes through better reach of Treasury functions. The Bank does not have any overseas operations.

WEALTH MANAGEMENT / PARABANKING ACTIVITIES

• Life Insurance: Bank has entered into a tie-up with LIC of India to solicit Life Insurance policies for their customers. All the products of LIC are available through their branches. Bancassurance tie up has been successfully embedded through training and they see this as a big step in improving fee income.

• General Insurance: Bank has tie-up with M/s.Bajaj Allianz General Insurance Company to market the General Insurance products.

• Mutual Funds and PMS: The Bank is presently having tie-up with Ten leading Asset Management Companies for promoting various Mutual Fund Schemes. In addition they are promoting Port Folio Management Services (PMS) through UTI Asset Management.

• Money Transfer through Branch Channels: In addition to foreign inward remittances arrangement with Weizmann Forex Limited. for extending Western Union Money Transfer facility, Bank has tied-up with UAE Exchange and Financial Services Limited, for offering Global Money Transfer services through Xpress Money and Moneygram.

• Money Transfer through Direct Remittances: The Bank has tied up with Times Money - Remit 2 India and Al-ahalia for Inward remittance from Abroad which enables the NRIs to remit the amount directly to their account / other residents.

• PAN Card Services: Bank has tied-up with M/s.UTI Infrastructure and Technology Services Limited, (UTIITSL) as PAN Service Agent (PSA) of collecting the PAN application across the country through Branches.

• Depository Participant Services: The Bank has registered as a Depository Participant with NSDL and with necessary regulatory clearances, this product is part of the suite that is offered to their customers. As responsible equity culture spreads, this business will offer a good platform for more value added products.

• ASBA: As Bankers to the issue, the Bank can now receive subscriptions under ASBA mode thus enabling the investors to earn interest till allotment of securities.

• Financial Inclusion: The bank has been actively participating in the Financial Inclusion campaign, extending basic banking services to the unorganized sectors of the economy, through Business Facilitator and Business correspondent model. During FY 2011-12, as a part of the policy initiatives of Reserve Bank of India, Business Correspondents have been engaged to implement financial inclusion in 18 allotted villages with population of over 2000 in Tamilnadu, based on this experience, this service will be extended to the 50 allotted villages. In addition, the Bank has opened over 28,000 No Frills Accounts to gradually improve banking penetration through its branches.

Wealth Management opportunities, in the towns the branch traditionally has presence, are significant and these new products are intended to improve the overall customer service and provide exposure to these products.

Even as more and more new products are being made available to the customers, responsible service continues to be imbedded in the Bank's tradition, and the Bank has an effective customer grievance redressal framework as well. The Bank is committed to treating customers fairly as part of the BCSBI code and the policies and processes are designed to strict adherence, under Board's monitoring.

It will also be a matter of pride to note that the Bank was adjudged the second fastest growing Bank in the small Bank category in the BT-PWC survey in FY 2010-11.

BOARD OF DIRECTORS

Mr. S.Narayan demitted office as the Non-Executive Chairman of the Board on 27.01.2011 on completion of his two year term. The Board wishes to place on record their sincere appreciation of the valuable services and guidance Mr. S.Narayan rendered during his tenure.

Mr. P.R.Somasundaram was appointed as Managing Director of the Bank with effect from 02.08.2010 for a period of three years as per the approval of Reserve Bank of India and Mr.K.S.R.Anjaneyulu, who functioned as the interim Managing Director from January 2010 has since reverted to his role as Executive Director of the Bank. The Board places on record their appreciation of the effective role played by Mr. K.S.R.Anjaneyulu as the Managing Director in the interim.

Mr. K.Balaji, Director, resigned from the Board effective 19th July 2011 after having served on the Board for close to 6 years. The Board wishes to thank Mr. K.Balaji for the advice and support he gave during his tenure.

Mr. B.K.Manjunath, Mr.N.Saiprasad and Mr. K.R.Pradeep are the directors retiring by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment.

FY 2011-12: OUTLOOK

The Bank will continue its emphasis on consistent profitable growth even as it steps up investments behind improved customer service through a network of new branches and ATMs, refurbishment of existing branches, significant hiring of new talent from Tier 2 towns, training and significant process changes, with outsourcing where relevant. Responsible growth in Advances will be coupled with appropriate de-risking strategies on the portfolio to control NPAs while improving NIM. New products will focus on increasing fee income and Retail business will be strengthened. Staff productivity will be key to improved profitability and technology-aided products will drive growth. Administrative functions like H. R and Audit will be significantly strengthened. Risk management and strict regulatory compliance will continue to be the platforms on which FY 2011-12 will consolidate the growth platform. The strategy should enable the Bank to rise sharply in the league of private sector Indian banks and reflect good growth in profitability.

MANAGEMENT DISCUSSION AND ANALYSIS

Industry Structure and Developments

Indian Banking industry comprises of Public Sector Banks including the State Bank of India and its subsidiaries, Old Private Sector Commercial Banks, New Private Sector Commercial Banks, Co-operative Banks, Regional Rural Banks and Foreign Banks, all operating in a stringent, transparent regulatory framework while competing with each other in a healthy environment to achieve excellence. The Bank was established in 1926 as Banking Company and is a Scheduled Commercial Bank under RBI regulations.

The monetary policy in FY 2010-2011 was calibrated on growth-inflation dynamics amidst persistent global uncertainties. Against the backdrop of global and domestic macroeconomic conditions, they believe the following underpin the FY 2011-2012 policy:

* 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 fund flows.

Opportunities and Threats:

Indian Banking sector is growing at a fast pace, yet penetration is low. Though growth opportunities are plenty, competition is stiff from both banks and non-banking finance companies.

Availability of capital is a key factor to fund the growth in advances and for deeper penetration of credit and banking services to the under-banked areas. Investments in IT apart, talent acquisition and retention poses a big challenge. De-regulation of interest rates on savings bank accounts, a possibility, could push up cost for the Banks though the bank considers it a welcome step. Banks like your’s, with a lower level of CASA could find it a more effective tool to acquire and retain customers and this could alter the competitive dynamics favourable to small banks.

Mobile technology and internet banking are fast becoming a trend among emerging young clientele and this could change the way branches function. NEFT and RTGS are fast outstripping traditional modes of payment and such transformational behavior changes could lead to technology redundancy costs.

One common theme now articulated in all regulatory and policy framework is inclusive banking through financial inclusion that is aimed to improve banking services in under-banked / un-banked areas and customer categories. These require investments and significant close monitoring by the top management in the initial years, apart from a Board level commitment to achieve the set targets. The bank has all this. Growth could be linked to performance on this front. Making these initiatives self sustaining and profitable is a challenge that Banks have to face up to or risk relevance.

Basle III requirements - the depth and timing of their introduction – could also pose a significant risk to margins and return on capital as capital requirements are higher for the same level of operations.

Cost increases through any industry level / national settlement on the lines of the second option of pension and arrears without direct linkage to performance could push up costs and make banks like their’s highly uncompetitive as compared with new generation banks where performance and pay are more closely linked.

New banking licences could make competition more severe in pockets and bring down net interest margins and overall returns.

Outlook

On the back of normal monsoon expectations and limited volatility in crude oil prices, the baseline projection of real GDP growth for 2011-12 for policy purposes is placed at around 8 percent. The growth is projected to be in the range of 7.4 percent and 8.5 percent in 2011-12 with 90 percent probability.

The aggregate deposits of SCBs are projected to grow by 17.0 percent. Growth in non-food credit of SCBs is projected at 19.0 percent. Theses monetary projections are consistent with the growth and inflation outlook.

The Bank has drawn various strategies to achieve a higher growth in business volume focusing on a healthy profitability. The various strategies include:

1. To continue to build a strong customer franchise across different business segments.

2. To leverage technology platform to deliver more products and control costs.

3. To maintain high standards for asset quality well supported by a rigorous credit management and strict adherence to prudential measures on industry concentration.

4. To develop more ancillary products and services enhancing profitability.

5. To invest in talent from their core areas and to improve training aimed at better sales orientation at the branch level.

6. To significantly invest in the network of new branches and ATMs

7. To diversify capital sources and improve capital efficiency.

UNAUDITED FINANCIAL RESULTS FOR THE QUARTER/ NINE MONTHS PERIOD ENDED DECEMBER 31, 2011

(Rs. in Millions)

	QUARTER-ENDED		NINE MONTHS ENDED
PARTICULARS	31-Dec-11	30-Sep-11	31-Dec-11
	(Reviewed)	(Reviewed)	(Reviewed)
1. INTEREST EARNED (a+b+c)	3942.705	3801.087	11101.466
(a) Interest/discount on advances/bills	3048.790	2945.111	8671.027
(b) Income on investments	873.762	841.415	2390.961
(c) Interest on balances with RBI and Other inter- bank funds	17.048	14.561	36.373
(d) Others	3.105	0.000	3.105
2. Other Income	352.208	313.909	1007.822
3. Total income (1+2)	4294.913	4114.996	12109.288
4. Interest expended	3036.547	2833.528	8295.137
5. Operating Expenses (I) + (II)	777.268	665.074	2019.689
(I) Employees cost	399.997	299.532	992.162
(II) Other operating expenses	377.271	365.542	1027.527
6. Total Expenditure (excluding provisions and contingencies (4) + (5)	3813.815	3498.602	10314.826
7. Operating Profit before provisions and contingencies (3) - (6)	481.098	616.394	1794.462
8. Provisions (other than Tax) and Contingencies	187.557	245.167	833.857
9. Exceptional items	0.000	0.00	0.000
10. Profit/Loss from ordinary activities before tax (7M8M9)	293.541	371.227	960.605
11. Tax expense	10.000	80.000	140.000
12. Net Profit/Loss from Ordinary activities after tax (10) - (11)	283.541	291.227	820.605
13. Extra Ordinary items (Net of Tax Expense)	0.000	0.000	0.000
14. Net Profit/Loss for the period (12+13)	283.541	291..227	820.605
15. Paid up equity share capital (Face Value Rs.10/-)	975.258	975.258	975.258
16. Reserves excluding revaluation reserves as per balance sheet of previous accounting year	7141.776	7141.776	7141.776
17. Analytical Ratios
1) Percentage of shares held by Government, of India	NIL	NIL	NIL
11) Capital Adequacy Ratio (%)
(a) Basle -I	10.22	10.98	10.22
(b) Basle- II	10.82	11.59	10.82
Hi) Earnings Per Share (EPS) (*Not Annualised)
(a) Basic & Diluted EPS - before extra ordinary Items (Not annuaiised)	2.91	2.99	8.41
(b) Basic & Diluted EPS - after extra ordinary items (Not annualised)	2.91	2.99	8.41
iv) NPA RATIOS
(a) Gross NPA	22597.75	19712.71	22597.75
Net NPA	11377.14	9505.50	11377.14
(b) % of Gross NPA	2.42	2.24	2.42
% of NET NPA	1.23	1.09	3.23
(c) Return on Assets (%)	0.76	0.80	0.76
18. Public Shareholding
- No. of Shares	86.261	86.341	86.261
- Percentage of shareholding	88.45	88.53	88.45
19. Promoters and promoter group shareholding
(a) Pledged /Encumbered
- Number of Shares	3392250	3381950	3392250
- Percentage of Shares ( as a % of the total shareholding of promoter and promoter group)	30.11	30.24	30.11
- percentage of shares (as a % of the total share capital of the company)	3.48	3.47	3.48
(b) Non-encumbered
-Number of shares	7872115	7802738	7872115
- Percentage of shares (as a % of the total shareholding of promoter and promoter group)	69.89	69.76	69.89
- percentage of shares (as % of the total share capital of the company)	8.07	8.00	8.07

Notes:

1. The working results for the quarter/ Nine months period ended 31st December 2011 have been arrived after considering provisions for Standard Assets, Non Performing Assets, Depreciation on Investment, Provision for Employees Benefit and Other usual and necessary provisions.

2. A sum of Rs.509.900 Millions has been provided during the quarter on proportionate basis towards the Transitional Liability of Rs.5198.100 Millions based on Actuarial Valuation up to 31.03,07 as per Revised Accounting Standard (AS-15) on Employee Benefits issued by Institute of Chartered Accountants of India. The balance amount of Rs.509.900 Millions is being carried forward to be charged to Profit and Loss Account in the next quarter.

3. In accordance with RBI Circular no. DBOD.BP.BC.80/21.04.018/10-11 dated: 09.02.2011.

a) a sum of Rs.538.900 Millions has been charged to profit and loss account during the quarter on proportionate basis towards pension liability. The balance amount of Rs.5505.600 Millions carried forward to be charged to Profit and Loss Account in future periods.

b) a sum of Rs.7.700 Millions has been charged to profit and loss account during the period on proportionate basis towards gratuity liability. The balance amount of Rs.599.500 Millions carried forward to be charged to Profit and Loss Account in future periods.

4. Provision coverage ratio as at 31st December 2011 stands at 70.96%

5. Status of Investor Complaints for the quarter ended 31st December 2011

Complaints pending at the beginning of the Quarter: Nil

Complaints received during the Quarter: Nil

Complaints disposed during the Quarter; Nil

Complaints unresolved at the end of the Quarter: Nil

6. The above financial results were recommended by the Audit Committee and approved by the Board of Directors of the Bank at their meeting held on 2nd February, 2012.

7. The figures of the previous year have been regrouped / rearranged, wherever necessary.

SEGMENT REPORTING – DECEMBER 2011

(Rs. In Millions)

PART A: BUSINESS SEGMENTS
PARTICULARS	QUARTER ENDED 31.12.2011	QUARTER ENDED 30.09.2011	9 MONTHS ENDED 31.12.2011
1. SEGMENT REVENUE :
a. Treasury operations	859.600	826.000	2409.800
b. Corporate/wholesale banking operations	1971.600	1927.200	5731.000
c. Retail banking operations	1455.000	1357.900	3946.900
d. Other banking operations	08.700	03.900	21.500
TOTAL	4294.900	4115.000	12109.200
2. SEGMENT RESULTS (Profit/loss before Tax)
a. Treasury operations	4.600	08.500	48.600
b. Corporate/wholesale Banking operations	142.400	128.300	465.000
c. Retail banking operations	142.200	234.700	437.600
d. Other banking operations	4.300	(0.300)	9.400
TOTAL	2935.000	371.200	960.600
PROFIT BEFORE TAX	2935.000	371.200	960.600
Less: Tax expenses	10.000	80.000	140.000
NET PROFIT	283.500	291.200	820.600
3. SEGMENT ASSETS:
a. Treasury operations	43984.000	44114.600	43984.000
b. Corporate/wholesale banking operations	60557.600	58236.000	60557.600
c. Retail banking operations	40209.900	38725.200	40209.900
d. Other banking operations	8365.700	7904.900	8365.700
TOTAL	153117.200	148980.700	153117.200
4. SEGMENT LIABILITIES:
a. Treasury operations	79.400	81.700	79.400
b. Corporate/wholesale banking operations	39544.600	39931.700	39544.600
c. Retail banking operations	100101.300	96175.800	100101.300
d. Other banking operations	3646.900	3330.100	3646.900
TOTAL	143372.200	139519.300	143372.200
CAPITAL AND RESERVES	9745.000	9461.400	9745.000
TOTAL	153117.200	148980.700	153117.200

PART B: GEOGRAPHICAL SEGMENTS

Since the Bank is having domestic operation only, no reporting is necessary under this segment.

Previous period’s figures have been regrouped, wherever necessary to conform to the current period’s classification.

CONTINGENT LIABILITIES

I. Claims against the Bank not acknowledged as debts - Rs.2149.048 Millions

II. Liability for partly paid Investments - 0.000

III. Liability on account of outstanding forward exchange contracts - Rs.20559.152 Millions

IV. Guarantees given on behalf of constituents

· in India – Rs.4275.167 Millions

· outside India – Rs.4.906 Millions

V. Acceptances, Endorsements and Other Obligations – Rs.11399.780 Millions

VI. Other items for which the Bank is contingently liable - 0.000

FIXED ASSETS

· Premises

· Furniture and Fixtures

BUSINESS DESCRIPTION

Subject is an India-based bank. It operates in four segments: treasury operations, corporate/wholesale banking operations, retail banking operations and other banking operations. The online services provided by the Bank includes national electronic fund transfer (NEFT), real time gross settlement system (RTGS), Internet banking, short message service (SMS) banking and electronic clearing service (ECS). As of March 31, 2011, the Bank operated 274 branches, including one satellite office and nine extension counters. The wealth management/parabanking activities include life insurance, mutual funds and port folio management services, money transfer through branch channels, money transfer through direct remittances and depository participant services. For the six months ended 30 September 2010, subject's total interest income increased 16% to RS5.04B. Net interest income after loan loss provision increased 12% to RS1.14B. Net income increased 8% to RS480.6M. Net Interest income reflects an increase in interest on advances and higher income on investments. Net income was partially offset by an increase in employee cost and a rise in other operating expenses.

BOARD OF DIRECTORS

Kusuma R. Muniraju (Non-Executive Independent Director)

Mr. Kusuma R. Muniraju is Non-Executive Independent Director of subject. He holds B.Sc., L.L.B.,DCT., degrees. He is an advocate with 37 years of standing and specialised in the areas of legal issues of the reality sector.

K. R. Pradeep (Non-Independent Non-Executive Director)

Mr. K. R. Pradeep is Non-Independent Non-Executive Director of subject. He is a Chartered Accountant, was appointed as Non-Executive Non Independent Director of Lakshmi Vilas Bank Limited on 27.02.2009.

PRESS RELEASES

State government asked to update land records, private banks reprimanded

RANCHI: Representatives of private commercial banks and rural regional banks were reprimanded for their poor performance during the 37th State-Level Bankers' Committee (SLBC) meet held here on Thursday. Addressing the meet, Allahabad bank executive director M R Nair asked the bank representatives to gear up to meet the targets within the remaining period of this financial year.

"If you fail to improve performance we have to hold a meeting with chairman of the respective banks and seek their interference," he said. Nair was supported by Union finance joint secretary A Bhattacharya who also expressed dissatisfaction over negligence of banks towards SLBC meets and achieving targets given to them at the beginning of financial year through annual credit plan (ACP).

While reviewing ACP for 2011-12, it was noted that banks like Lakshmi Vilas Bank, Punjab and Sind Bank, State Bank of Patiala, Yes Bank and Kotak Mahindra Bank had zero per cent achievement where as J and K Bank, South Indian Bank, Federation Bank, Indian Overseas bank, Bank of Maharashtra, Dena bank, IDBI, Andhra Bank, Oriental Bank of commerce and Jharkhand grammen bank were identified as banks with extremely poor performance.

Bhattacharya called upon representatives of every bank to explain reason for poor performance and expressed deep concern when he found most of the private bank representatives absent from the meeting.

Once again, during review of the financial inclusion programme, Central Bank, Jharkhand Grammen bank, United Bank and Vananchal Grammen bank were pulled up for poor performance whereas Punjab National Bank, Syndicate Bank, OBC, Dena Bank, Vijaya Bank Andhra Bank and bank of Maharashtra were asked to explain why the programme did not start even after nine months time elapsed in the FY-2011-12. Vijaya Bank's request to change the block where it was assigned to carry out financial inclusion was taken as serious exception and the joint secretary directed General Manager of the bank to explain gross negligence.

The SLBC Chairman also pointed finger at the state government for non compliance of certain assurances given by the chief minister during last SLBC meet. The government was reminded of the assurance given by CM Arjun Munda that Tenancy acts will be amended and all land records will be uploaded along with GI mapping by end of this month. The matter has been pending since March 2002 Waiver of stamp duty for loan up to Rs.0.500 Million and amendment of the debt recovery act through cabinet approval is also pending.

The SLBC, however, hailed overall performance of the banks on gross parameters. Against a target of distributing 0.450 Million Kisan credit cards, 433829 KCCs have been distributed till December 2011. The banks have collectively achieved CD ratio of 58.84% till December 2011 against 43.99% CD ratio of December 2010, which is slightly less than the national benchmark of 60%.

LakshmiVilas net up 10.35 pc to Rs.283.500 Millions

Mumbai, February 02 2012 (PTI) -- Private sector lender, Lakshmi Vilas Bank today posted a 10.35 percent rise in its net profit to Rs.283.500 Millions in the third quarter on the back of higher core income.

Net profit of the bank stood at Rs.256.900 Millions in the same period last year.

Total income of the bank rose by 49.35 percent to Rs.4294.900 Millions during this period.

Similarly, the private sector lender has witnessed a 48.10 percent rise in interest income to Rs 3940.000 Millions compared with Rs 2660.000 Millions reported in the same period last year.

While total deposits rose by 33.43 percent to Rs 132810.000 Millions from Rs 99540.000 Millions an year earlier, gross credit expanded by 35.07 percent to Rs 93440.000 Millions in the third quarter ending December.

The bank has also witnessed a decrease in non-performing asset during this period. While gross NPA decreased to 2.42 percent from 2.98 percent last year, net NPA decreased to 1.23 percent from 2.04 percent reported in the same period last year.

The private sector lender has a capital adequacy ratio of 10.82 percent by end of December and is planning to raise capital through tier-II bonds.

"The bank is in the process of raising tier-II bonds to the tune of Rs 2500.000 Millions to be closed shortly and expects to lift the capital adequacy ratio to 13.06 percent," the bank said.

Change in Company Secretary

India, December 30 -- Lakshmi Vilas Bank Limited has informed the Exchange that Shri N. Ramanathan, has assumed the Office of the Company Secretary of the Bank in place of Shri S. Venkateswaran with effect from December 30, 2011.

Security guards turn burglars

Two security guards are alleged to have burgled an ATM where they were deployed, in Venkatachalam Circle near Ulsoor Lake in the wee hours of Monday.

The accused have been identified as Bipul Borpujari, 53, a resident of Dodagundi and Masum Akhtar, 21, a resident of Cox Town. They made away with Rs.0.900 mIllion in cash from the ATM of Lakshmi Vilas bank in Ulsoor. The police suspect that they committed the burglary between 1 am and 6 am on Monday.

The Assam natives, attached with Modern VR Security Force, had been deployed at the ATM for the past three months. Masum, who was on night duty, was joined by Borpujari in committing the crime. Investigation revealed that the culprits knew that keys to open the cash section were kept inside the ATM as they used to closely watch bank employees fill cash in the machine.

The duo first broke the glass pane of the ATM and used the keys kept inside to remove three trays of cash before fleeing with the money.

The incident came to light around 8 am when another security guard reported for morning shift. He informed the incident to his office. The bank officials rushed to the spot and filed a complaint at Bharathinagar police station.

The police have registered a case based on the complaint lodged by branch manager Lakshmi Narayana. The burglary has been captured in the CCTV cameras installed in the ATM. The police formed teams to nab the accused.

Deputy commissioner of police (East), Chandra Sekhar said that the offence was committed by the security guards. "The CCTV footage will give the exact picture. We have got some clues and will soon catch the culprits," he said.

Photo Caption: The accused Bipul Borpujari and Masum Akhtar, who had been deployed at the ATM for the past three months, made away with Rs.0.900 Million in cash.-Mohan Kumar BN.DNA

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.49.33
UK Pound	1	Rs.77.41
Euro	1	Rs.64.84

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	7
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	7
--CREDIT LINES	1~10	6
--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	NO
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		60

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.