MIRA
INFORM REPORT
|
Report Date : |
11.07.2014 |
IDENTIFICATION DETAILS
|
Name : |
CORPORATION BANK |
|
|
|
|
Registered
Office : |
Post Box No. 88, |
|
|
|
|
Country : |
|
|
|
|
|
Financials (as
on) : |
31.03.2014 |
|
|
|
|
Year of
Establishment : |
1906 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs.1675.419 Millions |
|
|
|
|
TAN No.: [Tax Deduction & Collection
Account No.] |
BLRC04854D |
|
|
|
|
Legal Form : |
Public Sector Bank. The Banks Shares are Listed on the Stock Exchange.
|
|
|
|
|
Line of Business
: |
Banking and Other Related Services. |
|
|
|
|
No. of Employees
: |
18282 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (67) |
|
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 |
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Exist |
|
|
|
|
Comments : |
Subject is a profit making Government of India Bank. It is a well-established bank having a good track record. There seems
sharp dip in its profit during 2014. However, general financial position seems to be good. The bank gets
strong financial support from government. Trade relations are reported to be fair. Business is active. Payments
are reported to ne regular and as per commitments. The bank can be considered 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 – March 31, 2014
|
Country Name |
Previous Rating (31.12.2013) |
Current Rating (31.03.2014) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
INDIAN ECONOMIC OVERVIEW
N E W S
The economy grew 4.7 %in 2013/14, marking a
second straight year of sub-5 % growth – the worst slowdown in more than a
quarter of a century. The data was below an official estimate of 4.9 % annual
growth and compared with 4.5 % in the last fiscal year. However, the current
account deficit narrowed sharply to $ 32.4 billion at 1.7 % of gross domestic
product, in 2013/14 from a record high of $ 98.8 billion or 4.7 %, the year
before.A sharp fall in gold imports due to restrictions on overseas purchases
and muted import of capital goods helped shrink the current account deficit.
Online retailer Flipkart has acquired fashion
portal Myntra as it prepares to battle with the rapidly expanding India arm of
the global e-commerce giant Amazon. The company raised $ 210 million from
Russian Investment firm DST Global which has also invested in companies like
Facebook, Twitter and Alibaba Group.
General Motors will start exporting vehicles from
its Talegaon plant near Pune in the second half of 2014. GM was one of the few
global carmakers that was using its India plant only for the domestic market.
Google has overtaken Apple as the world’s top
brand in terms of value, according to global market research agency Millward
Brown. Google’s brand value shot up 40 % in a year to $ 158.84 billion. The top
10 of the 100 slots were dominated by US companies.
Infosys lost another heavy weight when B G
Srinivas, a board member put in his papers. He is the third CEO-hopeful to quit
after Chairman N R Narayana Murthy’s return to the company – Ashok Vemuri and V
Balakrishnan being the other two.While Vemuri went on to lead IGate,
Balakrishnan joined politics.
Naresh Goyal – promoted Jet Airways posted
biggest quarterly loss – Rs 2153.37 crore – in the three months ended March 31,
mainly because it has been offering discounts to passengers to fill planes.
William S Pinckney – Chairman and CEO of
Amway India was arrested by the Andhra Pradesh Police in connection with a
complaint against the direct selling firm. This is the second time that he has
been taken into custody. A year, ago the Kerala Police had arrested Pinckney
and two company directors on charges of financial irregularities.
China has told its state-owned enterprises to
sever links with American consulting firms after the United States charged five
Chinese military officers wih hacking US companies. China’s action which
targets consultancies like McKinsey & Co. and the Boston Consulting Group,
sterns from fears that the first are providing trade secrets to the US
governments.
India has emerged as a country with some of
the highest unregistered businesses in the world. Indonesia has the maximum
number of shadow businesses, says a study of 68 countries by Imperial College
Business School in London.
Pfizer has abandoned its attempt to buy
AstraZeneca for nearly $ 118 billion after the latter refused an offer of 55
pounds a share.
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CARE |
|
Rating |
Perpetual Bonds (AA+) (Revised from AAA) |
|
Rating Explanation |
High degree of safety and very low credit risk. |
|
Date |
July 2014 |
RBI DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter in
the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2012.
INFORMATION DECLINED
MANAGEMENT NON – COOPERATIVE (91-824-2426416)
LOCATIONS
|
Registered/ Corporate Office : |
Post Box No. 88, Mangala Devi Temple Road, Mangalore – 575001, Karnataka, India |
|
Tel. No.: |
91-824-2426416-420/ 2427911-13/ 24311685/ 2424971 (Direct) |
|
Fax No.: |
91-824-2441208/ 2425233/ 2423853/ 2444617/ 2440964 |
|
E-Mail : |
|
|
Website : |
|
|
|
|
|
General Office : |
18-20, Kasturba Gandhi Marg, New Delhi – 110 001, India |
|
|
|
|
Branch Office : |
104, Bharat House, Mumbai Samachar Marg, Fort, Mumbai – 400 023,
Maharashtra, India |
|
Tel. No.: |
91-22-22693431/ 22670030/ 22677088 |
DIRECTORS
As on 31.03.2014
|
Name : |
Mr. S R Bansal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Amar Lal Baultani |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. B. K. Srivastav |
|
Designation : |
Director |
|
|
|
|
Name : |
Ms. Anna Roy |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Manish Gupta |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. U. S. Paliwal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Sushobhan Sarker |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Kawaljit
Singh Oberoi |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. S. Shabber Pasha |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Vincent D’Souza |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Ekanath Ballga
|
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Bonam Venkata Bhaskar |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Adish Kumar Jain |
|
Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. C. G. Pinto |
|
Designation : |
General Manager
and Chief Financial Officer |
|
|
|
|
Name : |
Mr. S. K. Dash |
|
Designation : |
Company Secretary |
|
|
|
|
Name : |
Mr. B Narayana Shenoy |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. K. Giridhar Shenoy |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. P Rajaram Karanth |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. K. V. Raghava Kamath |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mrs. Swathi S. M. |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. Vasant Kini U. |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. B. B. Tejappa |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. K. S. Somayaji |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. K. G. Subramanian |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. N. B. Kulasekaran |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. Thangaraju V. |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. P. Paramasivam |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. Purnachandra Rao Dendukuri |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. Ajit Parkash Malhotra |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. V S Karthikeyan |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. Lakshinatha Reddy |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. C K Gopal |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. R Natrajan |
|
Designation : |
General Manager |
|
|
|
|
Name : |
Mr. G Guruharinadha Rao |
|
Designation : |
General Manager |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.06.2014
|
Names of Shareholders |
No.
of Shares |
Percentage
of Holding |
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
106105177 |
63.33 |
|
|
106105177 |
63.33 |
|
|
|
|
|
Total shareholding of Promoter and Promoter Group (A) |
106105177 |
63.33 |
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
3828863 |
2.29 |
|
|
283842 |
0.17 |
|
|
40057656 |
23.91 |
|
|
5362441 |
3.20 |
|
|
49532802 |
29.56 |
|
|
|
|
|
|
2589245 |
1.55 |
|
|
|
|
|
|
7223792 |
4.31 |
|
|
1410307 |
0.84 |
|
|
680554 |
0.41 |
|
|
78404 |
0.05 |
|
|
589755 |
0.35 |
|
|
5100 |
0.00 |
|
|
7295 |
0.00 |
|
|
11903898 |
7.11 |
|
Total Public shareholding (B) |
61436700 |
36.67 |
|
Total (A)+(B) |
167541877 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts
have been issued |
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
Total (A)+(B)+(C) |
167541877 |
0.00 |
BUSINESS DETAILS
|
Line of Business : |
Banking and Other related services |
GENERAL INFORMATION
|
No. of Employees : |
18282 (Approximately) |
|
|
|
|
Bankers : |
Reserve Bank of India |
|
|
|
|
Banking
Relations : |
|
|
|
|
|
Statutory Central Auditors : |
· Suresh Chandra and Associates Chartered Accountant · B.K. Ramadhyani and Company Chartered Accountant · Nripendra and Company Chartered Accountant
· GMJ and Company Chartered Accountant · Manohar Chowdhry and Company Chartered Accountant |
|
|
|
|
Subsidiaries : |
· Corpbank Securities Limited · Corporation Bank Economic Development Foundation · Corporation Bank Self Employment Training Institute · Gramina Abhyudaya Financial Literacy and Credit Counselling Trust · Corporation Bank Staff Provident Fund · Corporation Bank Pension Fund · Corporation Bank Gratuity Fund |
CAPITAL STRUCTURE
As on 31.03.2014
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
3000000000 |
Equity Shares |
Rs.10/- each |
Rs.30000.000 millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
167541877 |
Equity Shares |
Rs.10/- each |
Rs.1675.419 Millions |
Paid-up Capital :
|
Held by Central
Government |
Rs.1061.052
Millions |
|
|
|
|
Held by the
Public And Others |
Rs.614.367
Millions |
|
Total |
Rs.1675.419
Millions |
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
LIABILITIES |
|
|
|
|
|
|
|
|
|
Share Capital |
1675.419 |
1529.144 |
1481.293 |
|
Reserves &
Surplus |
99175.637 |
94127.828 |
81277.963 |
|
Deposits |
1933930.069 |
1660054.547 |
1361422.006 |
|
Borrowings |
130214.453 |
128988.463 |
142480.966 |
|
Other Liabilities
& Provisions |
55489.128 |
49723.353 |
48941.981 |
|
|
|
|
|
TOTAL
|
2220484.706 |
1934423.335 |
1635604.209 |
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
Cash &
Balances with RBI |
137402.076 |
88478.457 |
92882.345 |
|
Balances with
Banks & money at Call & Short notice |
4988.082 |
38354.764 |
24097.593 |
|
Investments |
661912.129 |
581644.943 |
474746.305 |
|
Advances |
1370862.992 |
1187166.456 |
1004690.208 |
|
Fixed Assets |
4652.680 |
4431.985 |
3559.766 |
|
Other Assets |
40666.747 |
34346.730 |
35627.992 |
|
|
|
|
|
TOTAL
|
2220484.706 |
1934423.335 |
1635604.209 |
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
|
Income |
|
|
|
|
|
Interest Earned |
179585.691 |
153340.827 |
130177.842 |
|
|
Other Income |
16477.179 |
16079.383 |
14926.194 |
|
|
TOTAL |
196062.870 |
169420.210 |
145104.036 |
|
|
|
|
|
|
|
|
Expenditure |
|
|
|
|
|
Interest expended |
141748.821 |
119082.344 |
98708.853 |
|
|
Operating Expenses |
23920.076 |
19967.812 |
17835.500 |
|
|
Provisions & Contingencies |
24776.787 |
16023.306 |
13499.258 |
|
|
TOTAL |
190445.684 |
155073.462 |
130043.611 |
|
|
|
|
|
|
|
|
Net Profit for the year |
5617.186 |
14346.747 |
15060.425 |
|
|
|
|
|
|
|
|
Appropriations |
|
|
|
|
|
Transfer to Statutory Reserves |
1404.296 |
3586.687 |
3850.000 |
|
|
Transfer to Staff Welfare Fund |
150.000 |
150.000 |
150.000 |
|
|
Reversal from staff welfare fund |
(194.631) |
0.000 |
0.000 |
|
|
Transfer from/to (net) Investment Reserve |
15.397 |
40.981 |
0.000 |
|
|
Transfer to Capital Reserve |
231.705 |
398.762 |
213.748 |
|
|
Special Reserves |
2070.000 |
3430.000 |
4070.000 |
|
|
Transfer to General Reserves |
617.294 |
3401.287 |
3247.394 |
|
|
Interim Dividend Paid |
753.945 |
0.000 |
0.000 |
|
|
Proposed Dividend |
376.979 |
2905.373 |
3036.660 |
|
|
Tax on Interim Dividends Paid |
128.133 |
0.000 |
0.0000 |
|
|
Tax on Dividends Proposed |
64.068 |
433.657 |
492.623 |
|
|
|
|
|
|
|
|
Earning per shares |
35.75 |
96.74 |
101.67 |
FINANCIAL ANALYSIS
[all figures are
in Rupees Millions]
DEBT EQUITY RATIO
|
Particular |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
(Rs.
In Millions) |
(Rs.
In Millions) |
(Rs.
In Millions) |
|
Share Capital |
1481.293 |
1529.144 |
1675.419 |
|
Reserves & Surplus |
81277.963 |
94127.828 |
99175.637 |
|
Net
worth |
82759.256 |
95656.972 |
100851.056 |
|
|
|
|
|
|
Borrowings |
130214.453 |
128988.463 |
142480.966 |
|
Total
borrowings |
130214.453 |
128988.463 |
142480.966 |
|
Debt/Equity
ratio |
1.573 |
1.348 |
1.413 |
YEAR-ON-YEAR GROWTH
|
Year
on Year Growth |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
(Rs.
In Millions) |
(Rs.
In Millions) |
(Rs.
In Millions) |
|
Interest Earned |
130177.842 |
153340.827 |
179585.691 |
|
|
|
17.793 |
17.115 |
NET PROFIT MARGIN
|
Net
Profit Margin |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
(Rs.
In Millions) |
(Rs.
In Millions) |
(Rs.
In Millions) |
|
Interest Earned |
130177.842 |
153340.827 |
179585.691 |
|
Profit |
15060.425 |
14346.747 |
5617.186 |
|
|
11.57% |
9.36% |
3.13% |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check List by Info Agents |
Available in
Report (Yes / No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
Yes |
|
8] |
No. of employees |
No |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact
person |
No |
|
11] |
Turnover of firm for last
three years |
Yes |
|
12] |
Profitability for last
three years |
Yes |
|
13] |
Reasons for variation
<> 20% |
-- |
|
14] |
Estimation for coming
financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister
concerns |
Yes |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details (if
applicable) |
No |
|
21] |
Market information |
-- |
|
22] |
Litigations that the firm
/ promoter involved in |
Yes |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
Yes |
|
25] |
Conduct of the banking
account |
-- |
|
26] |
Buyer visit details |
-- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if
applicable |
Yes |
|
29] |
Last accounts filed at
ROC |
Yes |
|
30] |
Major Shareholders, if
available |
Yes |
|
31] |
Date of Birth of Proprietor/Partner/Director,
if available |
Yes |
|
32] |
PAN of
Proprietor/Partner/Director, if available |
No |
|
33] |
Voter ID No of
Proprietor/Partner/Director, if available |
No |
|
34] |
External Agency Rating,
if available |
Yes |
LITIGATION DETAILS
SELECT BENCH: BANGALORE BENCH
SELECT CASE TYPE: RSA (REGULAR SECOND APPEAL) ENTER CASE
NUMBER: 1083 SELECT CASE YEAR : 2013
CASE PENDING
|
High Court of Karnataka -Bangalore Bench |
RSA 1083/2013 |
|
Petitioner/Appnt. Name |
M/S CANARA JEWELLERS |
Respondent/Defnt. Name |
CORPORATION BANK |
|||||
|
Petnr./Appnt. Advocate |
M VISHWAJITH RAI |
Respnt./Defnt. Advocate |
|
|||||
|
Date Filed |
25/06/2013 |
Classification |
MON |
District |
Mangalore |
|||
|
Stage |
PENDING FOR ADMISSON |
Last Posted For |
HEARING - INTERLOCUTORY APPLN |
|
|
|||
|
Last Action Taken |
NOTICE |
Last Date of Action |
05/12/2013 |
Next Hearing Date |
|
|||
|
Latest Order |
|
|||||||
|
Before Hon'ble Judge/s |
C.R.KUMARASWAMY |
|||||||
Lower Court Details
|
Case No |
Court Name |
Disposal Dt |
|
R.A. 105/2010 |
PRL. CIVIL JUDGE ( SR. DN.) & CJM MANGALORE ,DAKSHINA KANNADA |
15/01/2013 |
|
Sl No |
Honble Judge |
Date of Order |
|
1 |
HONBLE SANJ |
27/06/2013 |
PERFORMANCE AT A
GLANCE
The total business reached an impressive level of Rs.3304790.000 Millions as on 31st March, 2014, recording an absolute growth of Rs.457570.000 Millions over the business figure of Rs.2847220.000 Millions as on 31.03.2013, at a growth rate of 16.07%.
The total deposits of the Bank increased to Rs.1933930.000 Millions as on 31.03.2014 from Rs.1660050.000 Millions as on 31st March, 2013 registering a growth of 16.50% y-o-y.
Share of CASA in total deposits stood at 20.33% as on 31.03.2014 as compared to 21.68% as on 31.03.2013. Savings Deposits grew at a rate of 17.91%
The Bank continued its prudent approach in expanding quality credit assets in line with its policy on Credit Risk Management. The Bank’s credit figure reached a level of Rs.1370860.000 Millions as on 31.03.2014 from Rs.1187170.000 Millions as on 31st March, 2013, recording an absolute growth of Rs.183690.000 Millions at a growth rate of 15.47%. During the financial year, focused attention was given for accelerated lending under Agriculture, Priority sector, SMEs and midsize corporate and retail segments for expansion of credit. Credit-Deposit Ratio stood at 70.88% as on 31.03.2014 as compared to 71.51% as on 31.03.2013.
The Bank continued its drive for recovery of NPAs. During the financial year, the Bank effected a cash recovery and upgradation of NPAs of Rs.13555.300 Millions as compared to Rs.15093.000 Millions in the previous financial year.
Despite the economic slowdown and prevailing adverse situation, the Bank recorded a fairly good performance in
different functional areas during the financial year 2013- 14. The bank posted a Net Profit figure of Rs.5617.200 Millions.
As on 31.03.2014, the Bank had 8,617 functional units spread across 28 States comprising of 2,021 Branches, 2,264 ATMs and 4,332 Branchless banking units.
INCOME ANALYSIS
Interest Income of the Bank recorded a growth of Rs.26244.900 Millions (17.12%) from Rs.153340.800 Millions in the year 2012-13 to Rs.179585.700 Millions, as against the Interest expenses which grew by 19.03% from Rs. 119082.300 Millions during the financial year 2012-13 to Rs.141748.800 Millions during the year 2013-14. The Net Interest Income recorded a growth of Rs.3578.400 Millions [10.45%] during the same period.
The total Income of the Bank [total of Interest Income and Non-Interest Income] improved to Rs.19,6062.900 Millions during the financial year 2013-14 from Rs.169420.200 Millions in the previous financial year recording a rise of Rs.26642.700 Millions [15.73%].
Non-Interest Income from Core Areas increased by Rs.906.000 Millions [9.18%] from Rs.9867.900 Millions in the financial year 2012-13 to Rs.10773.900 Millions in the financial year 2013-14. The Total Non-Interest Income has increased from Rs.16079.400 Millions as on 31.03.2013 to Rs.16477.200 Millions as on 31.03.2014 by 2.47%.
The Operating Expenses has shown an increase of 19.79% during the financial year 2013-14 and stood at Rs.23920.100 Millions as compared to Rs.19967.900 Millions in 2012-13.
MANAGEMENT DISCUSSION
AND ANALYSIS
MONETARY AND CREDIT
POLICY 2013-14
The Annual Policy for 2013-14 was formulated in an environment of incipient signs of stabilization in the global economy and prospects of a turnaround, albeit modest, in the domestic economy.
Against this backdrop, the stance of monetary policy was intended to:
· Continue to address the accentuated risks to growth.
· Guard against the risks of inflation pressures re-emerging and adversely impacting inflation expectations.
· Appropriately manage liquidity to ensure adequate credit flow to the productive sectors of the economy.
The RBI expected a modest improvement in economic activity in FY14 compared to previous year. Based on this assumption, the country's economic growth was projected to grow at 5.7% in 2013-14. Keeping in view the domestic demand-supply balance, the outlook for global commodity prices and the forecast of a normal monsoon, WPI inflation was expected to be range-bound around 5.5% during 2013-14.
Consistent with the above growth projections and the RBI's inflation tolerance threshold, M3 growth for 2013-14 was projected at 13.0% for policy purposes. Consequently, aggregate deposits of SCBs were projected to grow by 14.0%. Keeping in view the resource requirements of the private sector, the growth in non-food credit of SCBs was projected at15.0%.
On the basis of the assessment, the Reserve Bank decided to reduce the policy reporate under the liquidity adjustment facility (LAF) by 25 basis points from 7.5% to 7.25%.The reverse repo rate under the LAF, determined with a spread of 100 basis points (bps)below the repo rate, automatically adjusted to 6.25%. The Marginal Standing Facility (MSF)rate, determined with a spread of 100 bps above the repo rate, adjusted to 8.25%.
Some other important regulatory and developmental measures proposed were as follows:
· Reduce the requirement of holding held-to-maturity (HTM) category bonds in the statutory liquidity ratio (SLR) portfolio for the banks to 23% from the existing 25%.
· Enhanced the loan limits to micro and small enterprises for priority sector classification.
· Speedier branch expansion in unbanked rural centers for ensuring seamless rollout of Direct Benefit Transfer Scheme of the Government.
· Finalized the prudential guidelines on restructuring of advances by banks and financial institutions based on the Mahapatra Committee recommendations.
· Increased the risk weights and provisioning requirements on banks' exposure to corporates on account of corporates' unhedged forex exposure positions.
· Bring all districts in metropolitan areas under the fold of the Lead Bank Scheme.
· Improve the interface of exporters with banks and financial institutions to cut delays and streamline procedures.
· To allow FIIs to hedge their currency risk by using exchange traded currency futures in the domestic exchanges.
· Allow non-bank authorized entities to be part of the payment system infrastructure.
· Restrict the import of gold on consignment basis by banks only to meet the genuine needs of exporters of gold jewellery.
· Prepare a discussion paper on White Label POS and place it in the public domain for comments.
· Follow a uniform, fair and transparent pricing policy and not discriminate between their customers at home branch and non-home branches with a view to ensure that bank customers are treated fairly and reasonably without any discrimination.
MACRO-ECONOMIC
SCENARIO IN 2013-14
As per the advance estimate of the CSO, India's GDP growth was expected to moderate to 4.9% in FY14, a slightly better growth compared to previous year's growth rate of 4.5%,mainly on an improved performance in the agriculture and allied sectors. The GDP growth rate was 4.4%, 4.8% and 4.7% respectively in the first, second and third quarters of2013-14 at an average of 4.6%.
As per advance estimates, the agricultural sector is likely to achieve a growth rate of 4.6% in 2013-14, compared to 1.4% 2012-13. On the other hand, manufacturing growth is expected to drop by -0.2% in FY14, from 1.1% in previous year. The growth in the mining and quarrying is likely to be at -1.9%, compared to contraction of -2.2% a year ago. The services sector including inance, insurance, real estate and business services sectors islikely to show growth of 6.3% in FY14, against 6.2% in FY 13.
The index of industrial production (IIP) showed a negative growth of 0.1% during2013-14 compared with 1.1% growth in the 2012-13. As per the use based classification, the cumulative growth during 2013-14 for basic goods, capital goods and intermediate goods stood at 2.0%, -3.7% and 3.0% respectively. The consumer durables and consumer on-durables have recorded a growth of -12.2% and 5.2% respectively, with an overall growth in consumer goods being -2.6%. As per the sector wise classification, mining and manufacturing decelerated to -0.8% and -0.8%, respectively, while electricity sector registered a growth of 6.1% in 2013-14 as against the preceding year.
Inflation as per WPI recorded a 3-month high of 5.70% in Mar'14 from as high as7.52% in Nov'13 and 5.65% during the corresponding month of the previous year. Food inflation (which has a weight of 14.3% in the WPI basket) increased to 9.90% in Mar'14from 8.12% in the previous month. On the other hand, core inflation increased to 12-monthhigh of 3.50% in Mar'14 as against 3.20% in Feb'14. In 2013-14, the wholesale price inflation averaged 5.91%, lower than the 7.36% inflation seen in the preceding year. Retail inflation, based on CPI, increased to 8.31% in Mar'14 from 8.03% in the preceding month. Core CPI inflation, which excludes food and fuel, stood at 7.82% in Mar'14, lower than 7.84% in Feb'14. In 2013-14, the retail inflation averaged 9.49%, lower than the10.18% inflation seen in the preceding year.
India's cumulative value of exports for the period Apr-Mar 2013-14 was $312.36billion as against $300.40 billion, registering a growth of 3.98% over the same period last year. The value of imports for the period Apr-Mar 2013-14 was $450.95 billion as against $490.74 billion registering a negative growth of 8.11% over the same period last year. The trade deficit for Apr-Mar 2013-14 was estimated at $138.59 billion which was lower than the deficit of $190.34 billion during Apr-Mar. 2012-13. India's Current Account Deficit (CAD) reached a record low of 0.9% of GDP for Q3 of 2013-14. The average CAD level for the first three quarters is around 2.3% of GDP and as per the initial estimate it is likely to be around 2% of GDP for the whole year. This is lower than the record CAD levelof4.8% of GDP in FY 13.
All key deficits, with the exception of effective revenue deficit, have turned out to be lower in 2013-14 revised estimates (RE) than the budget estimates (BE), in absolute terms. In terms of GDP, while the revenue deficit of 3.3% remained unchanged from the BE, gross fiscal deficit (GFD) and primary deficit (PD) were lower by 0.2% points each, at4.6% and 1.3% respectively. During 2014-15, the GFD-GDP ratio is budgeted to decline by0.5% points to 4.1%.
During 2013-14, the country's foreign exchange reserves rose by US $11.62 billion and stood at US $303.7 billion as on 28th Mar'14. In order to arrest the slide in Rupee and to augment depleting forex reserves, RBI had announced two concessional swap facilities on 4th Sep'13, under which banks could swap dollars raised through foreign currency non-resident (FCNR) deposits and overseas borrowings with the RBI. Over the three-month period from Sep'13-Nov'13, reserves surged by $16.5 billion. With the revival of portfolio flows since December 2013, India's forex reserves reached US$ 298.6 billion as on 21st Mar'14, an accretion of USS 28.2 billion over end-Aug'13.
The economic growth in FY15 is likely to be higher than that in FY14. However, the pace of recovery is likely to be modest. The recovery is likely to be supported by investment activity picking up due to part resolution of stalled projects and improved business and consumer confidence. The downside risk to growth still remains on account of the continued weak performance of industry and increase in risks to agriculture from the El Nino phenomenon. The current projections for GDP growth for FY15 by various agencies and inancial institutions range from 5% to 6%. While the RBI projected growth to be in the range of 5% to 6% in FY15, albeit with downside risks to the central estimate of 5.5%, the projection of National Council of Applied Economic Research (NCAER) and IMF stands at 5.6%and 5.4%, respectively.
BANKING TRENDS IN
2013-14
The combination of growth slowdown, persistence of inflation, rising bad loans and resultant restructuring of loans have posed a significant challenge for the performance of banking industry during 2013-14.
Taking cognizance of rising inflationary pressure in the economy, the Reserve Bank hiked policy interest rates by 75 bps during 2013-14. Accordingly, Repo and Reverse Repo Rate rose to 8% and 7%, respectively, while CRR was kept unchanged at 4%. In the Annual Monetary Policy 2013-14 presented on 3rd May'13, the RBI had reduced Repo Rate by 25 bps to 7.25% and the Reverse repo rate was adjusted to 6.25%. Thereafter, repo rate was increased by 25 bps to 7.5% in the Mid Quarter Monetary Policy Review on 20th Sep'13. It was further increased by 25 bps to 7.75% in the 2nd Quarter Review on 29th Oct'13.Finally, in the 3rd Quarter Review presented on 28th Jan'14, the repo rate was increased by 25 bps to 8%.
Due to exchange market pressures, the RBI took exceptional liquidity measures in2013-14. The MSF rate was increased by 300 bps to 10.25% from 17th July'13. Besides, the overall allocation of funds under the LAF was limited to 1.0% of the Net Demand and Time Liabilities (NDTL) of the banking system. The overall limit under LAF was further reduced to 0.5% of NDTL on 24th July'13. Banks were also required to maintain a minimum daily CRR balance of 99% of the requirement. However, with the ebbing of pressures on exchange rate, the RBI rolled back exceptional measures in a calibrated manner. Accordingly, the minimum CRR balance was reduced to 95% effective from the fortnight beginning 21st Sep'13. The MS Frate was reduced by 75 bps from 10.25% to 9.5% in the Mid-Quarter Review of Sep'13 and further by 50 bps on 8th Oct'13. In the 2nd Quarter Review of Monetary Policy presented on29th Oct'13, the MSF rate was reduced by 25 bps to 8.75% and this has brought down the gap between it and the repo rate back to its normal level of 100 bps.
During 2013-14, RBI injected net liquidity to the tune of about Rs. 520 billion through outright Open Market Operations (OMOs), besides an average daily net liquidity injection of Rs. 906 billion through LAF, MSF and term repos and Rs. 294 billion through export credit refinance (ECR). During Q4, an average trillion has been injected on a daily basis via LAF, MSF and term repos and Rs. 397 billion through ECR.
Scheduled Commercial Banks' (SCBs') business in FY14 was subdued, clearly showing lower economic activity. The deposit of SCBs has registered a y-o-y growth of 14.6% as at21st Mar'14, as against 14.3% in the corresponding period last year. However, much of the growth in deposit mobilization happened in the second half of FY14, largely aided by a surge in foreign currency non-resident (FCNR) deposits swapped by banks into Rupee deposits. Following this, deposit growth of SCBs even reached a high of 17.0% for the fortnight ended 13th Dec'13. Thereafter, deposits growth has cooled down once again to around 15%. Broad money (M3) for 2013-14 (up to 21st Mar'14) increased by 13.5% as compared to 13.8% during the corresponding period of last year.
The non-food credit growth of SCBs trended below the RBI projection of 15% forFY14. As on 21st Mar'13, the y-o-y growth in credit stood at 14.5% (up from 14.1%, a year ago). Credit growth had hit a high of 18.2% y-o-y for the fortnight ended 18th Sep'13.Credit demand increased in August and September as the RBI took extraordinary liquidity tightening measures in July to stem a slide in the Rupee.
The RBI has also decided to move to a new regime of bi-monthly monetary policy review starting 1st Apr'14, which is in line with the recommendation of the Urjit Patel panel on monetary policy. Under the new regime, RBI will hold six reviews in each inancial year, against the present practice of eight.
PERFORMANCE
HIGHLIGHTS:
i) The Non-Bank Deposits of the Bank has reached a level of Rs. 1720170.000 Millions as at31st March, 2014, registering a year-on-year growth of Rs. 254930.000 Millions at 17.4%. The total deposits of the Bank including Certificate of Deposits (CD's) reached a level of Rs. 1933930.000 Millions as at 31st March, 2014, registering year-on-year growth of Rs. 273880.000 Millions at 16.50%.
ii) Current Deposits stood at Rs. 148230.000 Millions as against Rs. 151800.000 Millions in the previous year.
iii) Savings Deposits reached Rs. 244780.000 Millions with net accretion of Rs. 37190.000 Millions at17.91% Y-O-Y growth.
iv) The Share of Demand Deposits in total Non-Bank Deposits stood at 22.85%.
v) Term deposits (excluding CDs and Inter Bank Deposits) reached a level of Rs. 1327150.000 Millions with a net accretion of Rs. 221310.000 Millions at a growth rate of 20.01% Y-O-Y.
vi) The Aggregate Average Deposits of the Bank increased by Rs. 281060.000 Millions and stood at Rs. 1648240.000 Millions as at 31st March, 2014 recording a growth of 20.56% year-on-year. Average CASA grew by 11.67% with net accretion of Rs. 29680.000 Millions and stood at Rs. 284100.000 Millions.
vii) The Bank has added 26,83,451 new Deposit Accounts during the year of which,23,91,538 new accounts have been added under Demand Deposits.
CONTINGENT LIABILITIES
|
PARTICULARS |
31.03.2014 |
|
|
|
|
Claims against the bank not acknowledged as debts |
5878.278 |
|
Liability on account of outstanding forward exchange contracts |
339253.213 |
|
Derivatives |
13250.000 |
|
Guarantees given on behalf of constituents |
|
|
in India |
119801.549 |
|
outside India |
17414.910 |
|
Acceptances, endorsements and other obligations |
128320.236 |
|
Total |
623918.186 |
PRESS RELEASES
CORPORATION BANK Q4 NET DOWN 88% ON HIGHER PROVISION, BAD LOANS
MAY 10, 2014
Corporation Bank today reported a sharp 88.3 per cent decline in net profit at Rs 415.700 Millions for the fourth quarter ended March 31, 2013-14 due to higher provisioning and rise in bad loans.
The Mangalore-headquartered bank had posted a net profit of Rs 3555.300 Millions in the year-ago period. The total income of the bank, however, increased to Rs 50326.200 Millions during January-March quarter of 2013-14, from Rs 46355.000 Millions in the corresponding period a year ago, it said in a regulatory filing to the BSE.
During the quarter, the bank made provisioning towards bad loans to the tune of Rs 8245.300 Millions, significantly higher than Rs 4599.300 Millions reserved a year ago.
Also, bank's net non-performing assets (NPAs) or bad loans jumped to 2.32 percent (Rs 31805.600 Millions) in the fourth quarter from 1.19 percent (Rs 14108.700 Millions) a year earlier.
Gross NPAs increased to 3.42 percent (Rs 47367.900 Millions) from 1.72 percent (Rs 20482.200 Millions). Bank's net profit for the entire fiscal also dipped to Rs 5617.200 Millions from Rs 14346.700 Millions in previous fiscal.
"Total income has increased from Rs 169420.000 Millions for the year ended March 31, 2013 to Rs 196062.900 Millions for the year ended March 31, 2014," it said. The bank's shares closed higher by 1.67 percent at Rs 301.10 apiece on the BSE today.
REDUCE CORPORATION BANK, ANDHRA BANK: SHAREKHAN
MAY 13, 2014
Corporation Bank : Corporation Bank reported a sharp decline in the profits (Rs.416.000 Millions, down 88 percent YoY) owing to a sharp increase in the provisions (up 79 percent YoY) and a weak core income performance in Q4FY2014. At the PBT level the loss was Rs.1880.000 Millions, though the tax reversals of Rs.2300.000 Millions cushioned the earnings. Led by significant additions to the NPAs (Rs11580.000 Millions), the reported NPAs increased on a Q-o-Q basis. The bank also restructured Rs.6100.000 Millions of the loans in Q4FY2014 and has around a similar amount of loans pipeline to get restructured. The management expects the slippages to remain high over the next couple of quarters. Corporation Bank’s operational metrics remain weaker among the peer banks owing to a higher dependence on the wholesale business. Given a moderate balance sheet growth and rising asset quality concerns, the return ratios may remain subdued. We maintain our Reduce rating on the stock with a price target of Rs.2750.000 Millions.
Andhra Bank : Andhra Bank continues to report a weak set of numbers (earnings down 74 percent YoY) owing to a sharp increase in the provisions (up 95 percent YoY) during Q4FY2014. The operating performance was also weak as the net interest income growth was flattish on a Y-o-Y basis. On the asset quality front, the bank disappointed due to a sharp increased in the restructured loans (partly offset by the upgrades), mainly from the power, roads, shipping, and iron and steel sectors. The bank has gross NPAs of 5.3 percent and given its higher exposure towards the stressed sectors we remain cautious over the asset quality. Andhra Bank’s operating performance has deteriorated owing to subdued margins and slower growth in the advances. On the other hand, the asset quality continues to witness stress signs which will keep the provisioning high, thereby impacting the earnings. We, therefore, expect the return ratios to remain subdued (RoA of 0.5 percent and RoE of about 10 percent) over the next three to four quarters. We maintain our Reduce rating with a revised price target of Rs60. For all recommendations, Click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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 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.59.73 |
|
|
1 |
Rs.102.36 |
|
Euro |
1 |
Rs.81.38 |
INFORMATION DETAILS
|
Information
Gathered by : |
HNA |
|
|
|
|
Analysis Done by
: |
DIV |
|
|
|
|
Report Prepared
by : |
KVT |
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 |
8 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
YES |
|
--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 |
NO |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
DEFAULTER |
|
|
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
TOTAL |
|
67 |
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 |
-- |
This report is issued at your request without any risk
and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its
officials.