MIRA INFORM REPORT

Report Date :

30.10.2014

IDENTIFICATION DETAILS

Name :	STATE BANK OF INDIA
Registered Office :	State Bank Bhavan, Central Office, 8^th Floor, Madame Cama Marg, Nariman Point, Mumbai – 400021, Maharashtra
Country :	India
Financials (as on) :	31.03.2014
Year of Establishment :	1806
Capital Investment / Paid-up Capital :	Rs.7465.700 Millions
Legal Form :	Subject is a Public Sector Commercial Bank Owned by the Government of India. The Bank's Shares are Listed on the Stock Exchanges.
Line of Business :	Banking Activities.
No. of Employees :	Information Decline by the management

RATING and COMMENTS

MIRA’s Rating :

Aaa (87)

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

Maximum Credit Limit :	USD 3900000000
Status :	Excellent
Payment Behaviour :	Regular
Litigation :	Exist
Comments :	Subject is a one of oldest and the largest bank in India. It is a well-established and reputed bank having excellent track record. The ratings continue to reflect the SBI’s systemic importance and dominant position in the Indian banking sector supported by strong resource profile, adequate capitalization and comfortable liquidity profile of the bank. Trade relations are reported as praiseworthy. Business is highly 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.

INDIAN ECONOMIC OVERVIEW

N E W S

Verdict Implications : Apex court order may alter coal import dynamics. Traders go slow on talks over coal supply contracts, uncertainty over cancellation of blocks weigh on stocks.

Recent arrest of the Chennai head of the Registrar of Companies, the ministry of corporate affairs arm that ensures that companies file all the information required by the Companies Act is the latest manifestation of a messy fight between a father and his adopted son for the control of Rs 40000 mn business empire. The Central Bureau of Investigation arrested Manumeethi Cholan after he accepted Rs 10 lakhs as bribe from M A M Ramaswamy, a CBI official said.

Central Bureau of Investigation books Electrotherm for cheating Central Bank of Rs 4360 mn.

Infosys maintains revenue guidance. COO Rao says attrition still an area of concern and it would take a few more quarters to bring down levels to 13-15 %.

DHL  to invest Euro 100 mn in India over next 2 years. The firm has chosen India to pilot its e-commerce business model for the Asia-Pacific region.

Blackstone may buy stake in BlueRidge SEZ in line with the fund’s real estate strategy in India.

Kingfisher Airlines Ltd grounded in October 2012 under the weight of heavy debt and accumulated losses, recently approached the Delhi high court for relief in two separate cases. The airline challenged a notice by Punjab and National Bank alleging that It had wilfully defaulted on Rs 7700 mn of loans and sought more time to comply with the requirements under the listing agreements with the Stock Exchanges.

OnMobile likely to sack another 300 employees. The lay-offs follow a spate of senior-level exits over the past two years, starting with of its founder. The overall lay-offs could number around 600 and are driven by the need to cut costs, says a former employee.

EXTERNAL AGENCY RATING

Rating Agency Name	CARE
Rating	Tier II Bonds (Basel III Compliant): “AAA”
Rating Explanation	Highest degree of safety and carry lowest credit risk.
Date	13.01.2014

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 31-03-2014.

INFORMATION DECLINED

MANAGEMENT NON-COOPERATIVE (TEL. NO.: 91-22-22740841/ 842)

LOCATIONS

Registered/ Corporate Office :	State Bank Bhavan, Central Office, 8^th Floor, Madame Cama Marg, Nariman Point, Mumbai – 400021, Maharashtra, India
Tel. No.:	91-22-22830535/ 22883888/ 22022678/ 22740841-48
Fax No.:	91-22-22855348
E-Mail :	sbimucnw@vsnl.net investor.complaints@sbi.co.in
Website :	http://www.sbi.co.in http://www.statebankofindia.com
Central Office :	State Bank Bhavan, P. B. No. 12, Madame Cama Road, New Administrative, Mumbai – 400021, Maharashtra, India
Tel No.:	91-22-22022426
Fax No.:	91-22-22852708/ 22040073/ 2385139
Local Boards :	Located at : Kolkata Mumbai Chennai New Delhi Lucknow Ahmedabad Hyderabad Patna Bhopal Bhubaneshwar Chandigarh Guwahati Bangalore
Overseas Branches Office:	Located at North America Europe Africa East and South Asia Australia Middle East

DIRECTORS

As on 31.03.2014

Name :	Mrs. Arundhati Bhattacharya
Designation :	Chairman
Name :	Mr. A. Krishna Kumar
Designation :	Managing Director
Name :	Mr. P. Pradeep Kumar
Designation :	Managing Director
Name :	Mr. S. Vishvanathan
Designation :	Managing Director
Name :	Mr. D. Sundaram
Designation :	Director
Name :	Mr. Parthasarathy Iyengar
Designation :	Director
Name :	Mr. Thomas Mathew
Designation :	Director
Name :	Mr. Jyoti Bhushan Mohapatra
Designation :	Workmen Employee Director
Name :	Mr. S.K. Mukherjee
Designation :	Officer Employee Director
Name :	Dr. Rajiv Kumar
Designation :	Director
Name :	Mr. Deepak Ishwarbhai Amin
Designation :	Director Nominated by GOI
Name :	Mr. Harichandra Bahadur Singh
Designation :	Director Nominated by GOI
Name :	Mr. Rajiv Takru
Designation :	Director
Name :	Mr. Urjit R. Patel
Designation :	Director Nominated by GOI
Name :	Mr. Tribhuwan Nath Chaturvedi
Designation :	Director Nominated by GOI
Name :	Mr. Gurdial Singh Sandhu
Designation :	Director Nominated by GOI

COMMITTEES OF THE BOARD

Executive Committee of the Central Board (ECCB)	Mrs. Arundhati Bhattacharya, Chairman Mr. A. Krishna Kumar-Managing Directors Mr. P. Pradeep Kumar, Managing Directors Director nominated under Section 19(f) of the SBI Act (Reserve Bank of India nominee), viz. Dr. Urjit R.Patel, and all or any of the other Directors who are normally residents or may for the time being be present at any place within India where the meeting is held.
Audit Committee of the Board (ACB)	Mr. S. Venkatachalam, Director – Chairman of the Committee Mr. D. Sundaram, Director – Member Mr. Thomas Mathew, Director – Member Dr. Rajiv Kumar, Director –Member Mr. Rajiv Takru, GOI Nominee – Member Dr. Urjit R. Patel, RBI Nominee – Member Mr. P. Pradeep Kumar,, MD and GE (NB) –Member (Ex-Officio Mr. A. Krishna Kumar, MD and GE (NB) –Member (Ex-Officio
Risk Management Committee of the Board (RMCB)	Mr. A. Krishna Kumar, MD and GE (IB) – Member (Ex-Officio) Chairman of the Committee Mr. P. Pradeep Kumar,, MD and CFO-Member (Ex-Officio) Mr. S. Venkatachalam, Director – Member Mr. D. Sundaram, Director – Member Mr. Thomas Mathew, Director – Member Dr. Rajiv Kumar, Director – Member Mr. Tribhuwan Nath Chaturvedi, Director – Member
Shareholders’/Investors’ Grievance Committee of the Board (SIGCB)	Mr. S. Venkatachalam, Director– Chairman of the Committee Mr. Thomas Mathew, Director – Member Dr. Rajiv Kumar, Director – Member Mr. Harichandra Bahadur Singh, Director – Member Mr. A. Krishna Kumar, MD and GE(IB) – Member (Ex-Officio) Mr. P. Pradeep Kumar, MD and GE(A and S) - Member (Ex-Officio)
Special Committee of the Board of Directors for Monitoring of Large Value Frauds	Mr. A. Krishna Kumar, MDandGE (IB) - Member (Ex-Officio) – Chairman of the Committee Mr. P. Pradeep Kumar, MDandGE (CB) – Member (Ex-Officio) Mr. S. Venkatachalam, Director – Member Mr. Parthasarathy Iyengar, Director – Member Mr. Thomas Mathew, Director – Member Dr. Rajiv Kumar, Director – Member Mr. Harichandra Bahadur Singh, Director – Member
Customer Service Committee of the Board (CSCB)	Mr. A. Krishna Kumar, MD and GE(NB) – Member (Ex-Officio) - Chairman of the Committee Mr. P. Pradeep Kumar, MDandGE (CB) – Member (Ex-Officio) Mr. S. Vishvanathan, MD and GE(A and S) - Member (Ex-Officio) Mr. Thomas Mathew, Director – Member Mr. Harichandra Bahadur Singh, Director – Member Mr. Jyoti Bhushan Mohapatra, Director – Member Mr. S. K. Mukherjee, Director – Member Mr. Tribhuwan Nath Chaturvedi - Director – Member
IT Strategy Committee of the Board (ITSC)	Mr. D. Sundaram, Director - Chairman of the Committee Mr. S. Venkatachalam, Director – Member Mr. Parthasarathy Iyengar, Director – Member Mr. P. Pradeep Kumar, MDandGE (CB) – Member (Ex-Officio) Mr. A. Krishna Kumar, MDandGE (CB) – Member (Ex-Officio)
Remuneration Committee of the Board	Mr. Gurdial Singh Sandhu,, GOI Nominee – Member (Ex-Officio) Dr. Urjit R. Patel, RBI Nominee – Member (Ex-Officio) Mr. S. Venkatachalam, Director – Member Mr. D. Sundaram, Director – Member
Board Committee to Monitor Recovery (BCMR)	Mrs. Arundhati Bhattacharya, Chairman Mr. A. Krishna Kumar, MD and GE(IB) – Member Mr. P. Pradeep Kumar, MD and GE(IB) – Member Mr. Gurdial Singh Sandhu, GOI Nominee – Member (Ex-Officio)

MEMBERS OF LOCAL BOARD:

Ahmedabad	Mr. A. N. Appaiah Chief General Manager (Ex-Officio)
Bangalore	Mr. Ashwini Mehra Chief General Manager (Ex-Officio)
Bhopal	Mr. Riten Ghose Chief General Manager (Ex-Officio) Mr. Ramesh Warlyani Mr. G. P. Gupta Mr. Manohar Bothra
Bhubaneswar	Mr. Krishna Mohan Trivedi Chief General Manager (Ex-Officio) Mr. Sarat Chandra Bhadra
Chandigarh	Mr. Lingaraj Mohapatra Chief General Manager (Ex-Officio) Mr. Vinod Bihari Sharma Smt. Ravinder Kaur Mr. Anil Arora
Chennai	Mrs. P.S. Prakasha Rao Chief General Manager (Ex-Officio) Mr. T. R. Loganathan
Hyderabad	Mr. C. R. Sasikumar Chief General Manager (Ex-Officio) Mr. M.V. Ranganath
Kolkata	Mr. Sunil Srivastava Chief General Manager (Ex-Officio)
Lucknow	Mr. Sudhir Dubey, Chief General Manager (Ex-Officio) Mr. Harichandra Bahadur Singh* Mr. Madan Mohan Shukla Mr. Munish Kumar Jain
Mumbai	Mrs. Anshula Kant, Chief General Manager (Ex-Officio) Mr. S. Venkatachalam* Mr. D. Sundaram* Mr. Parthasarathy Iyengar* Mr. Thomas Mathew* Mr. S. M. Lodha
Delhi	Mr. Arijit Basu, Chief General Manager (Ex-Officio) Dr. Rajiv Kumar* Mr. T.N. Chaturvedi* Mr. Dinesh Kumar
North Eastern	Mr. Sanjay Kumar Magoo, Chief General Manager (Ex-Officio)
Patna	Mr. Subrat Sahu, Chief General Manager (Ex-Officio) Mr. Tanvir Akhtar Mr. Sanjay Mandal
Kerala:	Dr. M. Sreenatha Sastry, Chief General Manager (Ex-Officio) Mrs. Alphonsa John Mr. Sudhir Abraham Mr. Philip Mathew Mr. A. Gopalakrishnan *Directors on the Central Board nominated on the Local Boards as per Section 21(1)(b) of SBI Act.
MEMBERS OF CENTRAL MANAGEMENT COMMITTEE:	Mrs. Arundhati Bhattacharya,, Chairman Mr. A. Krishna Kumar, Managing Director and Group Executive, (International Banking) Mr. P. Pradeep Kumar, Managing Director and Group Executive (Corporate Banking) Mr. Soundara Kumar, Deputy Managing Director and Group Executive (Stressed Assets Management) Mr. R.K. Saraf, Deputy Managing Director and Chief Financial Officer Mr. B. V. Chaubal, Deputy Managing Director and Group Executive (Global Markets) Mr. S. K. Mishra, Deputy Managing Director (Corporate Strategy and New Businesses) Mr. V. Murali, Deputy Managing Director (Inspection and Management Audit) Mr. N. Jambunathan, Deputy Managing Director and Chief Information Officer Mr. N.K. Chari, Deputy Managing Director and Group Executive (Mid-Corporate) Mr. Praveen Kumar Malhotra, Deputy Managing Director (Operations) - National Banking Group Mr. B. V. Chaubal, Deputy Managing Director and Corporate Development Officer Dr. J. N. Misra, Deputy Managing Director and Corporate Development Officer Mrs. Varsha V. Purandare, Deputy Managing Director and Chief Credit and Risk Officer Mr. M.G. Vaidyan, Deputy Managing Director (Retail Strategy) - National Banking Group

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 31.03.2014

Category of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Central Government / State Government(s)	437459825	59.87
Sub Total	437459825	59.87
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	437459825	59.87
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	36136039	4.95
Financial Institutions / Banks	2403463	0.33
Central Government / State Government(s)	172932	0.02
Insurance Companies	111071736	15.20
Foreign Institutional Investors	83498853	11.43
Sub Total	233283023	31.93
(2) Non-Institutions
Bodies Corporate	19261277	2.64
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 Million	36132663	4.95
Individual shareholders holding nominal share capital in excess of Rs. 0.100 Million	1312466	0.18
Any Others (Specify)	3240310	0.44
Non Resident Indians	974571	0.13
Trusts	1060560	0.15
Overseas Corporate Bodies	1000	0.00
Foreign Nationals	202	0.00
Foreign Corporate Bodies	770704	0.11
Clearing Members	433273	0.06
Sub Total	59946716	8.20
Total Public shareholding (B)	293229739	40.13
Total (A)+(B)	730689564	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	0	0.00
(1) Promoter and Promoter Group	0	0.00
(2) Public	15883528	0.00
Sub Total	15883528	0.00
Total (A)+(B)+(C)	746573092	0.00

SHAREHOLDING OF SECURITIES (INCLUDING SHARES, WARRANTS, CONVERTIBLE SECURITIES) OF PERSONS BELONGING TO THE CATEGORY PROMOTER AND PROMOTER GROUP

Sl.No.	Name of the Shareholder	No. of Shares held	As a % of grand total (A)+(B)+(C)
	President of India	43,74,59,825	58.60
	Total	43,74,59,825	58.60

(*) The term encumbrance has the same meaning as assigned to it in regulation 28(3) of the SAST Regulations, 2011.

Shareholding of securities (including shares, warrants, convertible securities) of persons belonging to the category Public and holding more than 1% of the total number of shares

Sl. No.	Name of the Shareholder	No. of Shares held	Shares as % of Total No. of Shares	Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital
1	Life Insurance Corporation Of India	100808206	13.50	13.50
2	HDFC Trustee Company Ltd - HDFC Equity Fund	15506024	2.08	2.08
	Total	116314230	15.58	15.58

Shareholding of securities (including shares, warrants, convertible securities) of persons (together with PAC) belonging to the category “Public” and holding more than 5% of the total number of shares of the company

Sl. No.	Name(s) of the shareholder(s) and the Persons Acting in Concert (PAC) with them	No. of Shares	Shares as % of Total No. of Shares
1	Life Insurance Corporation Of India	100808206	13.50
	Total	100808206	13.50

Details of Locked-in Shares

Sl. No.	Name of the Shareholder	No. of Shares	Locked-in Shares as % of Total No. of Shares
1	President Of India	3,60,45,243	4.83
2	President Of India	1,29,88,697	1.74
3	President Of India	1,12,18,685	1.50
	Total	6,02,52,625	8.07

Details of Depository Receipts (DRs)

BUSINESS DETAILS

Line of Business :

Banking Activities

GENERAL INFORMATION

No. of Employees :	Information Decline by the management
Bankers :	Reserve Bank of India

Banking Relations :

---

Auditors :

S N Nandaand Company New Delhi, SCAs of Patna Circle SCM Associates Bhubaneshwar, Bhubaneshwar Circle Singhi and Company Kolkata, North Eastern Circle S R R K Sharma Associates Bangalore, SCAs of Kerala Circle T. R. Chadha and Company New Delhi, Mumbai Circle S. Venkatram and Company Chennai, Chennai Circle Prakash and Santosh Kanpur, Bhopal Circle K. B. Sharma and Company Jammu, Chandigarh Circle Add and Associates Kolkata, Ahmedabad Circle V. P. Aditya and Company Kanpur, Lucknow Circle S. Jaykishan Kolkata, Bengal Circle Dhamija Sukhija and Company Srinagar, Delhi Circle Sriramamurthy and Company Visakhapatnam, Hyderabad Circle Mehra Goel and Company New Delhi, SCAs of Bangalore Circle

CAPITAL STRUCTURE

As on 31.03.2014

Authorised Capital : Not Available

Issued Capital,Subscribed and Paid-up Capital : Rs. 7465.700 Millions

[

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

CAPITAL AND LIABILITIES	31.03.2014	31.03.2013
SHAREHOLDERS FUNDS
Share Capital	7465.700	6840.300
Reserves and Surplus	1175356.800	981996.500
Deposits	13944085.100	12027395.700
Borrowings	1831308.800	1691827.200
Other Liabilities and Provision	964129.600	954053.000
TOTAL	17922346.000	15662112.700
ASSETS
Cash and balances with Reserve Bank of India	849556.600	658304.100
Balance with Banks and Money at call and short notice	475939.700	489897.500
Investments	3983081.900	3508775.000
Advance	12098287.200	10456165.500
Outside India	80021.600	70050.200
Fixed Assets	435459.000	478920.400
TOTAL	17922346.000	15662112.700

CAPITAL AND LIABILITIES	31.03.2012
SHAREHOLDERS FUNDS
Share Capital	6710.448
Reserves and Surplus	832801.610
Deposits	10436473.623
Borrowings	1270055.680
Other Liabilities and Provision	809150.946
TOTAL	13355192.307
ASSETS
Cash and balances with Reserve Bank of India	540759.386
Balance with Banks and Money at call and short notice	430872.263
Investments	3121976.103
Advance	8675788.901
Fixed Assets	54665.492
Others Assets	531130.162
TOTAL	13355192.307

PROFIT AND LOSS ACCOUNT

PARTICULARS	31.03.2014	31.03.2013
INCOME
Interests Earned	1363508.000	1196551.000
Others Income	185529.200	160368.400
TOTAL	1549037.200	1356919.400
EXPENDITURE
Interests Expended	870686.300	753258.000
Operating Expenses	357258.500	292844.200
Provision and Contingencies	159353.500	111308.300
TOTAL	1387298.300	1157410.500
PROFIT
Profit before tax	161738.900	199508.900
Current Tax	42274.700	59538.800
Deferred Tax	10552.500	(1079.700)
Profit after tax	108911.700	141049.800
Profit brought forward	3.400	3.400
TOTAL	108915.100	141053.200
APPROPRIATIONS
Transfer to Statutory Reserve	3396.200	44178.600
Transfer to Capital Reserve	50134.000	64724.300
Dividend for the previous year paid during the year	0.100	0.000
Dividend for the current year (including interim dividend and tax on dividend)	25381.600	32146.900
Balance carried forward to Balance Sheet	3.200	3.400
TOTAL	108915.100	141053.200

PARTICULARS	31.03.2012
INCOME
Interests Earned	1065214.534
Others Income	143514.457
TOTAL	1208728.991
EXPENDITURE
Interests Expended	632303.687
Operating Expenses	260689.921
Provision and Contingencies	198662.497
TOTAL	1091656.105
PROFIT
Net Profit for the year	117072.886
Profit brought forward	3.393
Profit and Loss Balance of e-SBI Commercial and International Bank Limited. Transferred on Amalgamation	57.115
TOTAL	117133.394
APPROPRIATIONS
Transfer to Statutory Reserve	35169.772
Transfer to Capital Reserve	143.769
Transfer to Revenue and Other Reserve (Including Transfer to Investment Reserve Account for 2009-10 Rs.40.556 Millions)	55364.960
Dividend
Final Dividend Proposed	23486.569
Tax on dividend	2964.931
Loss on Amalgamation of State Bank of Indore	0.000
Balance carried over to Balance Sheet	3.393
TOTAL	117133.394
Basic Earning per Share	184.31
Diluted Earnings Per Share	184.31

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	6710.448	6840.300	7465.700
Reserves & Surplus	832801.61	981996.500	1175356.800
Net worth	839512.058	988836.800	1182822.500
long-term borrowings	10436473.623	12027395.700	13944085.100
Total borrowings	10436473.623	12027395.700	13944085.100
Debt/Equity ratio	12.432	12.163	11.789

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)
Interests Earned	1065214.534	1196551.000	1363508.000
		12.330	13.953

NET PROFIT MARGIN

Net Profit Margin	31.03.2012	31.03.2013	31.03.2014
	(Rs. In Millions)	(Rs. In Millions)	(Rs. In Millions)
Interests Earned	1065214.534	1196551.000	1363508.000
Profit	117072.886	141049.800	108911.700
	10.99%	11.79%	7.99%

LOCAL AGENCY FURTHER INFORMATION

CURRENT MATURITY OF LONG TERM DEBT DETAILS: NOT AVAILABLE

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	No
8]	No. of employees	Yes
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	No
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	No
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	No
31]	Date of Birth of Proprietor/Partner/Director, if available	No
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

CASE DETAILS

BENCH:-BOMBAY

Presentation Date:-				24/07/2014
	Lodging No.:-	WPL/1963/2014	Filing Date:-	24/07/2014	Reg. No.:-	WP/1941/2014	Reg. Date:-	16/08/2014

Petitioner:-

INFRASTRUCTURE LEASING & FINANCIAL SERVICES LTD AND ANR

Respondent:-

RECOVERY OFFICER, DEBT RECOVERY TRIBUNAL-II, MUMBAI AND 15 ORS

Petn.Adv.:-

RMG LAW ASSOCIATES

Resp.Adv.:-

BODHANWALLA AND COMPANY

District:-

MUMBAI

Bench:-	DIVISION
Status:-	Pre-Admission	Category:-	WRIT PETITION(OTHERS)

Next Date:-

26/11/2014

Stage:-

FOR ADMISSION - FRESH [ORIGINAL SIDE MATTERS]

Coram:-

HON'BLE SHRI JUSTICE V.M. KANADE

HON'BLE SHRI JUSTICE P.D. KODE

Last Date:-

07/10/2014

Stage:-

FOR ADMISSION - FRESH [ORIGINAL SIDE MATTERS]

Last Coram:-

HON'BLE SHRI JUSTICE V.M. KANADE

HON'BLE SHRI JUSTICE P.D. KODE

Act :-

Debt Tribunal Recovery Act

ECO NOMIC BACKDROP AND BANKING ENVIRONMENT

Global Economic Scenario

The global economic environment has broadly strengthened, and is likely to improve further, with much of the growth impetus emanating from advanced economies. However, global growth still remains uneven with strengthening of the US economy, subdued growth in the Euro Area and Japan and slowdown in Emerging Markets and Developing Economies (EMDC). Although full global recovery is a distant prospect, normalisation of

fiscal policies is now on the agenda of governments across the world.

The prices of global energy items and non-fuel commodities reduced by 1% and 1.2%, respectively, due to lower demand in 2013. However, the decline in commodity prices reflected disproportionately on consumer inflation. For the advanced countries, consumer inflation declined by 0.6% to 1.4% in 2013, while in the EMDC it exhibited downward rigidity and declined marginally by 0.2% to 5.8%. The policy responses of major central banks (the US,

ECB and Japan) no more resemble the coordination of the earlier years. The US Federal Reserve’s Quantitative

Easing programme is expected to witness major unwinding before the end of 2014. However, conditions in Euro Zone and Japan may constrain the European Central Bank (ECB) and Bank of Japan to scale down monetary expansion programmes. In such a scenario, they may enter into a new phase of asymmetric policy responses, where both ECB and Bank of Japan will be expanding, while the US will, in part, contracting. These policy stances may heighten the uncertainty associated with global growth momentum. The impact on asset prices and commodity prices thus will remain uncertain.

India’s Economic Scenario

India remains one of the fastest growing economies of the world. However, the country’s growth momentum has remained subdued for two consecutive years, reflecting weak and fragile global growth and domestic supply constraints. India’s GDP growth improved moderately to 4.7% in FY 2013-14 against 4.5% in the previous year, and is estimated to increase further to 5.3%-5.5% in the current financial year (SBI estimates).

The forecast for below normal rainfall in current fiscal does not augur well for agricultural production. There were also unseasonal rains, accompanied by hailstorm and frost during early part of March 2014 in various parts of the country, adversely impacting Rabi crops. However, the good thing is that, led by higher crop production, agricultural GDP including allied sector is poised to grow by 4.7% in FY 2013-14, over three times higher than 1.4% in the previous year. Industrial growth continues to remain sluggish due to lackluster investment climate, stalled projects and subdued consumption demand. Persistent contraction in the mining sector, owing to regulatory and environmental hurdles also contributed to the overall decline in industrial activity.

However, the electricity sub-sector grew smartly by 5.9% in FY 2013-14 against 2.3% in the previous year. It continued to generate some optimism amidst a bleak industrial scenario, but its buoyancy was clearly inadequate to counter the weakness of other constituent sectors. With the formation of a stable Government at the Centre with renewed focus on reforms, economic activity across all sectors is likely to pick up pace.

Inflation, both Wholesale Price Index (WPI) and Consumer Price Index (CPI), remains a matter of concern. Both the build-up of inflation during April - November 2013 and the subsequent fall in inflation during December – February 2013-14 was driven by food prices. During the period June - December 2013, inflation in food articles remained in double digits, while in manufactured products it was stable at around 3% throughout the year. In fuel and power sector, inflation rose to 8.9% in April 2014 from 8.3% in April 2013. The core inflation remained below 3% during April – November 2013 but thereafter rose gradually to 3.50% by end of March 2014. however, it again declined to 3.40% in April 2014.

The Indian economy is now on the threshold ofa major transformation, with expectations of policy initiatives by the newly elected Central Government.

On the external front, improvement in the current account deficit (CAD) from 4.7% of GDP in FY 2012-13 to 1.7% for FY 2013-14 is good news. The narrowing of CAD followed a lower trade deficit due to higher exports as well as moderation in imports. With a gradual recovery in key partner economies, India’s exports began to improve in July 2013; this was also helped by rupee depreciation. During FY 2013-14, exports grew by 3.98%, while imports contracted by 8.1%. It resulted in sharp contraction in trade deficit from USD 190.3 bn in March 2013 to USD 138.6 bn in March 2014, primarily due to a 40% decline in gold imports. Going forward, with a likely improvement in world 2014-15.

Due to various measures taken by the RBI since September 2013, surge in capital inflows led to reserve accretion. This is yet another positive development during the financial year 2013-14. The RBI’s swap windows for banks’ mobilization of fresh FCNR(B) deposits and overseas borrowing helped to build reserve during September - November 2013. With the revival of portfolio flows since December 2013, India’s forex reserves reached USD 314.9 billion (as on 16th May, 2014), an accretion of USD 22.9 bn over that of a year ago. With a lower CAD and build-up of foreign exchange reserves, the downward pressure on the currency and the volatility in the Indian rupee have subsided down. The rupee has also moved in a narrow range of Rs.60.10 to Rs.62.99 per US dollar since End-November 2013 to March 2014. In fact, during this period the rupee outstripped most of the other emerging market currencies.

OUTLOOK

The Indian economy is now on the threshold of a major transformation, with expectations of policy initiatives by the newly elected Central Government. The economy is on the road to modest recovery with cautiously positive business sentiments, improved consumer confidence and more controlled inflation. The sectors which were significantly impacted by the crisis and slowdown in the economy are now showing definite signs of improvement. The challenge for maintaining disinflationary momentum over the medium term, however, remains on the horizon. A moderate recovery is likely to set in 2014-15 and real GDP may grow by 5.3% to 5.5%.

However, data revisions for previous quarters and the consequent changes in base effects impart uncertainty to the growth trajectory ahead. The pace of recovery, nevertheless, is likely to be modest. It is likely to be supported by investment activity picking up due to part resolution of stalled projects and improved business and consumer confidence.

In an interesting development, the Indian Meteorological Department’s (IMD) forecast of below normal rains have

triggered widespread discussions about India’s production of food grains, agriculture’s contribution to the GDP and concerns about food inflation in the current fiscal. Whatever may be the course of Monsoon 2014 going forward, fears of drought are unfounded at this point of time. The outlook for industrial activity is positive. Industrial growth, which had been subdued in the past two fiscal, is now likely to gather momentum with moderately stronger global growth, improving export competitiveness and implementation of recently approved investment projects. The new Central Government’s reforms focus should also act as an impetus to growth. In the baseline scenario, commodity prices will remain muted during 2014. In the current scenario, global food and meal prices are likely to moderate. According to the US Energy Information Administration (EIA), the Brent crude oil price is projected to average USD 105 and USD 101 per barrel in 2014 and 2015, respectively, thus imparting a clear softening bias. Going forward, while the global commodity price scenario provides some comfort, the rate of inflation may decelerate further from what has been witnessed in recent months. In the coming years, they may see a fascinating scenario emerging in the India-China growth debate. While India is now focusing on increasing its share of manufacturing sector to 25% by 2025, China has already embarked on a mission of significantly revamping its services sector.

The strategy of shifting the Chinese economy towards a service-sector bias may sooner or later impact India’s services trade balance. However, considering China’s growing ageing population such structural transformation would take a while to materialise. Banking Industry Developments Being one of the top 10 global economies with a billionplus population, India offers a significant potential for the banking sector to grow. In addition, one third of the country’s population still remains outside the purview of formal banking offering the Indian banking industry a rare opportunity to grow and help facilitate the nation’s inclusive growth agenda.

Going forward, the country’s Rs.81 trillion (USD 1.34 trillion) banking industry may see more participants and greater healthy competition. Two new banks have already received licences from the RBI i.e. IDFC and Bandhan Group, which apart from providing impetus to financial inclusion, is expected to intensify competition in the banking sector in the medium term.

STATEMENT OF UNAUDITED RESULT FOR THE QUARTER YEAR ENDED 30TH JUNE 2014

(Rs. In Millions)

	Particulars	Quarter Ended
		30.06.2014
		Unaudited
	Interest Earned/Net Income from sales/services	3,64,871.200
	Interest / discount on Advances / bills	2,75,598.200
	Income on Investments	85,593.200
	Interest on Balances with RBI & other interbank funds	900.400
	Others	2,779.400
	Other Income	42,520.900
	Total Income	4,07,392.100
	Interest Expended	2,32,348.800
	Operating Expenses	87,165.900
	Employee Cost	55,645.700
	Other operating expenses	31,520.200
Less	Total Expenditure for Banks	3,19,514.700
	Operating Profit Before Provisions and Contingencies	87,877.400
Less	Provisions (other than tax) and Contingencies	34,967.300
	Exceptional Items	----
	Profit (+)/ Loss (-) from Ordinary Activities before Tax	52,910.100
Less	Tax	19,419.300
	Net Profit (+)/ Loss (-) from Ordinary Activities after Tax	33,490.800
Less	Extraordinary Items	0.000
	Net Profit	33,490.800
	Equity Capital	7,465.700
	Face Value (in Rs)	10.000
	Reserves
	Percentage of Share held by Govt	58.600
	Capital Adequacy Ratio
	Basel II	12.85
	Basel III	12.33
	EPS before Extraordinary items (in Rs)
	Basic & Diluted EPS before Extraordinary items	44.86
	EPS after Extraordinary items (in Rs)
	Basic & Diluted EPS after Extraordinary items	44.86
	Gross/Net NPA
	Amount of Gross NPA	6,04,342.400
	Amount of Net NPA	3,18,838.000
	Percentage of Gross/Net NPA
	% of Gross NPAs	4.90
	% of Net NPAs	2.66
	Return on Assets	0.74
	Number of Public Shareholding	30,91,13,267
	Percentage of Public Shareholding	41.40
	Promoters and Promoter Group Shareholding
	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
	Non-encumbered
	Number of Shares	43,74,59,825
	Percentage of Shares (as a% of the total shareholding of promoter & prom group)	100.00
	Percentage of Shares (as a % of the total share capital of the company)	58.60

SEGMENT WISE REVENUE, RESULTS AND CAPITAL EMPLOYED

Sr. No.	Particular	Quarter Ended
		30.06.2014
		(Unaudited)
1.	Segment Revenue
	Treasury Operations	91482.900
	Corporate/ Wholesale Banking Operations	148557.700
	Retail Banking Operations	166314.200
	Insurance Business	--
	Other Banking Operations	--
	Add/Less : Unallocated	1037.300
	TOTAL	407392.100
2.	Segment Revenue
	Treasury Operations	10944.000
	Corporate/ Wholesale Banking Operations	5129.000
	Retail Banking Operations	45340.100
	TOTAL	61413.100
	Add/Less : Unallocated	(8503.000)
	TOTAL PROFIT BEFORE TAX	52910.100
	Less:
	Income Tax	19419.300
	Extraordinary profit / loss	--
	Net profit before share of profit in associates/Minority Interest	33490.800
	Add : share of profit in associates	--
	Less : Minority Interest	--
	NET PROFIT	33490.800
3.	CAPITAL EMPLOYED
	(Segment Assets-Segment Liabilities)
	Treasury Operations	2137363.800
	Corporate/ Wholesale Banking Operations	824652.200
	Retail Banking Operations	(1255428.600)
	Unallocated	(488601.800)
	TOTAL	1217985.600

SUMMARIZED STATEMENT OF ASSETS AND LIABILITIES

CAPITAL AND LIABILITIES	Quarter Ended
	30.06.2014
	(Unaudited)
SHAREHOLDERS FUNDS
Share Capital	7465.700
Reserves and Surplus	1210519.900
Minority Interest	0.000
Deposits	14189152.200
Borrowings	1873282.500
Other Liabilities and Provision	858947.100
TOTAL	18139367.400
ASSETS
Cash and balances with Reserve Bank of India	734488.900
Balance with Banks and Money at call and short notice	0.000
Investments	426897.100
Advance	4468001.400
Fixed Assets	81429.100
Others Assets	439522.000
TOTAL	18139367.400

NOTE :

The above results have been reviewed by the Audit Committee of the Board at their meeting held on August 07, 2014 and approved by the Board of Directors at their meeting held on August 08, 2014. The results have been subjected to a limited review by the Statutory Central Auditors.

The financial results for the quarter ended June 30, 2014 have been arrived at after considering necessary provisions for NPAs, Standard Assets, Standard Derivative Exposures and Investment Depreciation on the basis of prudential norms issued by the RBI. Provisions for Contingencies, Employee Benefits including provision for wage revision, Direct Taxes (after adjustment for Deferred Tax) and for other items / assets are made on estimated basis.

There are no material changes in the Significant Accounting Policies adopted during the quarter ended June 30, 2014 as compared to those followed in the previous Financial Year 2013-14.

Banks are required to disclose Capital Adequacy Ratio under Basel - III capital regulations. Pillar 3 (Market Discipline) disclosures (unaudited) as per RBI guidelines on Composition of Capital Disclosure Requirements as at June 30, 2014 for the Group can be accessed at the Bank's website

The shortfall on account of sale of assets to Reconstruction Companies (arrived at by deducting provision held as on March 31, 2014 from the outstanding less Sale consideration) amounting to Rs. 7231.100 Millions is being amortized over a period of two years, in terms of RBI Circular dated February 26, 2014. Consequently, Rs. 903.900 Millions has been charged to the Profit and Loss Account for the quarter ended June 30, 2014.

Banks are required to make additional provision in respect of customers with Unhedged Foreign Currency Exposures (UFCE). Accordingly based on the available information provided by the customers, the Bank has estimated a provision requirement of Rs.3432.400 Millions. Out of the above, a sum of Rs.858.100 Millions has been charged to P and L during the quarter ended June 30, 2014, being one fourth of the requirement, as permitted by the RBI.

Provision Coverage Ratio as on June 30, 2014 was 62.68%.

Previous period figures have been regrouped/reclassified, wherever necessary, to conform to current period classification.

CMT REPORT (Corruption, Money Laundering and 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 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.61.32
UK Pound	1	Rs.99.00
Euro	1	Rs.78.14

INFORMATION DETAILS

Information Gathered by :	HTL
Analysis Done by :	KAR
Report Prepared by :	KVT

SCORE and RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	10
PAID-UP CAPITAL	1~10	10
OPERATING SCALE	1~10	10
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	10
--PROFITABILIRY	1~10	9
--LIQUIDITY	1~10	9
--LEVERAGE	1~10	9
--RESERVES	1~10	10
--CREDIT LINES	1~10	10
--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	YES
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		87

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 and 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.