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This preparation guide for interview is a voluntary effort in the direction of collating past and general experiences of candidates who have appeared for interviews in our Bank in various scales & grades. Coupled with this, an effort has also been made to capture the latest & significant happenings in various domains of Banking & Finance World. The questions that have been compiled are only indicative and candidates can expect additional derivative questions based on these indicative questions. Here and there, indicative answers are also given and we suggest our esteemed aspirants to refer our SBLC’s promotion materials for further details. In order to assist our readers in obtaining answers/information on the topics highlighted, information index of “what is available where” is also provided. We are sure that all this will be very useful to our esteemed aspirants. WE wish the prospective candidates

ALL THE BEST.

Compiled By: Pramod Kumar Mishra Chief Manager, Training

State Bank Learning Centre, Patna 0612-2592980

Facing Interview? 2011/Team SBLC Patna/PKM

(“ctrl+click” on the link will take you to the topic of your choice and “to Index” will again

redirect you to Index page)

INDEX

SL. Topics Description Page No.

1 General Guidelines

Suggested readings, Study materials

03

2 Personality/ Self

Personality related questions 06

3 Career Test

Career related questions

08

4 Assignments / work

Current & previous assignments

Promotion Appraisal Formats (for preparing

your answers around PAF)

10

5 Our Bank

SBI specific questions , Vision, Mission &

values, Awards & Recognition, List of Directors

on the Central Board of State Bank of India

34

6 General awareness

General questions relating to Economy

& Financial System 38

7 Banking Scenario

General Banking related questions with

special emphasis on Indian Banking 46

8 Readings

Chairman’s statement & interviews. Important articles that have appeared in Bank’s official publications/Newspapers

48

9 Circulars

“e-Circulars” – Index of Important Circulars (Gist of e Circulars: Hyperlinked)

61

Hyperlinks/Gist%20of%20important%20Circulars%2027032010%20to%2013052011.doc


10 Policy Guidelines

a. Chairman’s Policy guidelines 2011-12 (Hyperlinked)

120

11 Other Policies

Compensation policy, Customer Service, Grievance Redressal Policy, Branch authorization Policy etc.

122

12 SBI Data

Some key statistics of the Bank as at 31.03.11

122

13 Indian Economy Data

Indian Economy – Economic Survey, Budget, Monetary Policy

124

14 Customer Service

Segmentation of customers on the basis of

Net Worth 146

15 SBI in NEWS

In last few months

152

16 Misc

A few current national & international issues 235

17 Circle Specific

Patna Circle data 236

18 General Tips

General tips & Misc. Issues (important

committees and their reports), Important

Terms, Priority Sector & Forex update,

General Questions & answers.

242

1 General Guidelines

Suggested readings, Study materials and General Guidelines in answering interview questions

1. Banking Brief 2011 2. Latest Reading Material, Econ-Fin Info & Quarterly Banking and Finance Newsletter SBLC Patna 3. Short Notes compiled by SBLC Patna 4. Book Briefs & Book Condensation by SBLC Patna, Other book condensations from different

Hyperlinks/committees%20and%20reports.doc

Hyperlinks/committees%20and%20reports.doc

Hyperlinks/Banking%20Brief%202011.pdf

Hyperlinks/exam%20book.pdf

Jan.%20to%20March'2011%20Qtrly%20Journal.pdf

Jan.%20to%20March'2011%20Qtrly%20Journal.pdf


ATIs/SBLCs. 5. SBIRD weekly brief: Atleast 6 months since 6. Master Circulars ( SBI): latest 7. Master Circulars ( RBI): latest (July 2010) 8. Loan Policy 2009 (Modifications): if you are dealing in advances. 9. Credit Management (SBSC Hyd.) : if you are dealing in advances. 10. Lectures / Speeches (especially for higher level promotions): if required, please contact. 11. Internal Magazines published by different ATIs/ Departments: available on SB times 12. Magazine & Reading Materials from IIBF: iibf.or.in : if required , please contact

General Guidelines for answering Interview Questions

First of all please prepare:

(Please structure your answers in a notebook/diary. Let it have some relation with your self-

appraisal for the last 4 yrs.)

1. Profile: Self & Branch/Unit (in detail), Region, Circle & Bank (Basic details)

2. SWOT analysis: Self & Branch/Unit (in detail), Region, Circle & Bank (Basic details)

IMPORTANT TIPS Be in yourself; do not try to imitate anyone. Bearing: Walk erect and with confidence. Maintain eye contact with the interview board Chairman and members while talking. Irrespective of the fact who has asked the question, maintain eye contact with every board member with special emphasis on Chairman of the board. Smile and be pleasant. Be enthusiastic and interested. You must be lively, keen and cheerful. Let your optimism and energy radiate. Conduct: Politeness pays. Be empathetic and attentive. Observe meticulously the code of manners and etiquette. Never be rude, argumentative or offensive. Do not neglect to pay compliments. Speech: Talk slowly deliberately and audibly. You should neither shout nor mumble. Pronounce your words clearly and crisply. Never be dull or monotonous with your words. Avoid use of phrases such as, you see, I say, of course I mean, etc. Dress: Choose your dress with care. It must be comfortable and befitting for the occasion. Smart and trendy look is not required; you must look sober. Choose your dress wisely and invest some amount, if required. Use shoes with laces and it must shine from the back side, too. Take special care on top 12 inches & bottom 12 inches, as well. Personal Hygiene: Be neat, tidy and clean. See that you are well groomed.


Self control: Do not become emotional or get nervous. Be confident and patient. Check unnecessary movements. The Board may deliberately try to provoke you and see how easily you could be upset. Never lose your temper, whatsoever may be the situation. Do not bluff: State only what you know to be correct. Do not hazard guesses unless you are asked to do so. No beating in the bushes, please. Say politely that you are not very sure and you will try to know that. Shooting lions and boasting will land you in trouble. Do not try to be too clever. Remember, the board has years of experience and has interviewed several candidates. Own up your mistakes: If the board points out that you had made a mistake and you realize it to be fact, then be courageous and own it up. Never try to cover it up. The Board will respect you for your honesty. Initiative: Use your initiative but watch the reactions of the Board. Also, be conscious of your limitations. Do not over shoot. Do not draw conclusions. Be discreet when you talk about your own accomplishments. They should be conveyed subtly and tactfully. Criticism and Arguments: Do not criticize. Never try to find faults. As far as possible, stress the good point of others. It is better to be silent than to criticize. Do not get involved in unproductive arguments. You have not gone to the interview to win a verbal battle but to have a meaningful conversation. See how you can agree rather than to disagree. As a last resort, you may agree or disagree. Always remember one thing, you may win an argument but then chances of winning interview would be bleak. Listen and Observe: Keep your eyes and ears open. Study their reactions. You will know when to stop talking and when to listen. As a rule, do not interrupt. If the other person wishes to talk, let him do so. In fact, encourage him to talk. Be an attentive and enthusiastic listener. Practice: Practice, practice and practice. You must have as much practice as possible. Enlist the goodwill and co-operation of your friends, colleagues, elders and family members and have practice sessions with them. The more practice you have, the better it will prove. It will guarantee your SUCCESS. Try to frame your best possible answer for probable questions. IMPORTANT TIPS FOR FACING INTERVIEWS CONFIDENTLY You do need to be aware about your surroundings and this includes familiarity with current affairs. Banking industry specific questions are common. In addition, there are certain questions you may encounter during the interview, in one form or the other. These relate to questions about yourself, what you have been doing and what you want to do in future. In fact, many a times interview starts with personal sort of questions like “Tell me about yourself” or “your SWOT analysis”, etc. It is a good idea to sit for mock interviews with your friends or colleagues. Remember, practice makes a man perfect. Practice how you are going to enter into and exit from the interview


room. If it makes you comfortable, take a few deep breaths before entering into the room and pray the deity you worship and faith most. There is no standard correct answer as such. What you need to do is to answer these questions calmly. Even during real interview, you should think before answering the questions. Prepare a diary of probable questions and answers and practice it as many times as you can. You need to pause before answering to collect your ideas as it will help you put together all the points, substantiating your response. Though you should not gloss over your weaknesses, you need to focus on your success and your achievements/strengths. You need to convince the interviewer that you are the most suitable person for the higher position. Like for Scale IV & V the traits which are considered as:

a. Ability for proactive action b. Variety of assignments c. Vision & execution capabilities d. Problem solving & decision making e. Team building & motivation f. Customer & marketing orientation

So, you must prepare yourself based on these traits. We are providing hereunder some questions, the Interview Board may not ask the same

question but preparation of it will make you comfortable in answering all type of questions.

2 Personality/ Self

Personality related questions

1. What are the goals in your life?

2. Let us know something about yourself that we don’t know?

3. What is the significance of your name or surname?

4. Let us know something about your birthplace, place of living, workplace. Please, remember special features of the place, like, if you belong to Nalanda, you are supposed to know about the Nalanda Vishwavidyalaya, Rajgir & Pawapuri, if you belong to Jamshedpur, you must know the full name of TISCO and unique features of the city etc.


5. Let us know something about your academic background.

6. Once the above question is asked, you may expect some questions on your subject of Post Graduation/Graduation/area of specialization.

7. What were your subjects in College? (Once this is asked, 2 or 3 subject related

questions may be expected)

8. In case you have specialization in fields not directly related to banking, say – electronics,

engineering, etc., then you can expect questions like how relevant has been your specialization background helpful in your current banking career.

9. Your Branch/unit/self Profile.

10. If you were to make a SWOT ANALYSIS of yourself, what do you think your assessment

would be?

11. How do you balance your professional and personal life?

12. When you face difficult situations/criticism, how do you respond?

13. What are the most 3 important events in your life?

14. Who has / have influenced the most in your life? Why?


15. Have you changed over the years? If so, how & why?

16. Do you consider yourself as a leader or a follower? What are the qualities required in a

leader?

17. Who are your role models? Why are they role models?

18. What are your hobbies? (One or two questions relating to hobby(ies) may be expected)

19. How do you spend your leisure time?

a. Which magazines and newspapers do your read regularly?

What do you like about these magazines and newspapers? What columns or sections do you like in these magazines and

newspapers? Who are the editors of the magazines? Any special feature attached to that newspaper?

b. What were the headlines of today’s newspapers?

c. Do you read books? Which are your favourite books? Who are your favourite

authors?

(If you indicate that you like literature, you can expect related questions on recent happenings like who is the winner of Nobel Prize for literature, Booker Prize etc. for the latest year )

d. If you happen to say, you enjoy watching cricket, you can expect questions like:

Do you think Indian Cricket team is playing well? Are we experimenting too much? What are the suggested measures to improve cricket? Why is cricket popular in India? About World Cup, IPL & T-20.

e. If you happen to say, you enjoy watching TV, you can expect questions like:


Which TV serial you like most? Why do you like the particular TV serial? About TV related awards. What is TRP? How to calculate TRP etc.

20. Lady candidates can expect questions like:

How do you balance your career and family needs? Are you ready to be transferred to remote places, different assignments? List out the names of ladies who have made it to the top in the recent past in

different fields?

3 Career Test

Career related questions

1. List out 5 major accomplishments / highlights of your career.

2. List out your major accomplishments during the last 5 years? Especially if posted as BM then achievements during your tenure.

(Let it have some relevance to your Self-Appraisal Report or let it not contradict your report submitted earlier)

3. What are the difficult assignments handled by you in your career? Why do you think

they were difficult? How did you handle it?

4. What skills have you developed over the period in the Bank?

5. Why do you think you deserve promotion?

6. Are you ready to work anywhere in India? Ready to be transferred anywhere? Ready to

be posted for any assignments?

7. What do you think about yourself in the Bank?

a) 5 years hence b) 10 years hence c) Your peak career advancement in the Bank and reasons for your answer.


8. In case you become part of the Top Management today, list out your priorities and

concerns? Few reasons for your priorities.

9. What is your wish list for the Bank?

10. What kind of assignments would you like to deal within the Bank? According to you,

which is the best & worst assignment in the Bank? Reasons for your choice.

11. What traits do you think are required to become successful in one’s career? What is

OLQ’s (Officer like qualities).

12. Do you feel Bank has given you due recognition till now? If yes, how? If not, why?

13. If you have a lucrative career option outside the Bank, what factors will you take into

consideration for continuing or switching over?

14. How was your Branch Manager’s assignment experience? What do you think are

the ideal qualities of a Branch Manager? How independent were you in discharging your duties? What were the pressures borne by you? In your opinion Branch Manager’s assignment is easier or tougher now-a-days than in earlier times? Give reasons to support your answer.

15. What do you think is your level of self-motivation? Do you think there is an enabling

environment in the Bank for you to realize your full potential? Do you think, Bank has given you ample opportunity for growth?

16. What is leadership? How many types of leaders are there? Which Leadership Style

you like & follow? And why?


17. Can you recollect any humorous, important, momentous incidence or touching

moments in your career / life?

18. SWOT Analysis- Self, Assignment, Region, Circle, Bank.

19. Your concerns- Official, personal & others.

20. Your greatest achievements – Job related achievements in your personal life.

4 Assignments / work

Current & previous assignments

This is your domain and, therefore, you are the best judge. Needless to say, the candidates are expected to be thorough, knowledgeable and presentable in this area. Sit quietly for two or three hours and jot down as many questions as possible in these and other related areas. For example, the candidate may be in a forex dealing branch and handling exports related seat. The expectation here would be that he knows everything about Foreign Exchange. Also, he will be expected to know what is happening at the macro level especially for SMGS & TEGS level promotion, though it may not have a direct bearing on his seat. Hence, develop quickly the domain related knowledge. Be very clear about your assignment, role, targets, constraints, challenges, opportunities and future plans. It is recommended that, everyone should go through the questions suggested for a particular assignment. Emphasis may be more on present assignment related questions but for complete view, it is required to have a look at all the questions. Go carefully through your self-appraisal report. If you are in a Branch, go through MIS , P-Report, Branch Dossier, recent highlights of your Branch (Proposals handled, new business booked, etc.),Inspection & Audit Reports , highlights of your city, town, etc. In the interaction during interviews, mainly the focus ranges from job knowledge to attitudinal aspects, from potential to performance and from banking history to emerging banking scenario. Bankers are expected to be conversant with all the changes taking place in the financial services sector. Interview is an opportunity for you to present your personality consisting of your attitude, views and awareness level before the interview board, so that the potential in “You” is appropriately judged by the members of the Interview Board, who are learned and experienced people in their own field of specialization.


In order to judge your potential, evaluation of your performance in the recent past, operating style, team building capabilities, effectiveness, neutral judgment level, transparency in dealings, initiatives, attitude, leadership qualities, your conflict management techniques, your pressure management techniques, your vision and ability to see beyond the boundaries are some noteworthy attributes. For junior level promotions, knowledge about bank’s scheme and ability for future growth is a must, but for fairly higher grade promotions what is needed is your leadership qualities, your negotiation skills, your ability to handle difficult and conflicting situations, your visioning ability, your practical strategy for future development of the organization and also for the self is a pre-requisite. Although, you should focus on current assignment, you may be asked some questions from your earlier assignments. Assignment related important questions:

A. If the candidate is from a Branch: 1. Your priority areas? 2. Location of your Branch. 3. Achieved budget? Reasons, if not achieved; strategies adopted, if achieved.( all

parameters). Business performance of the branch vis-à-vis budget. Growth achieved during your tenure vis-à-vis prior to yours.

4. If you are from a Super Circle of Excellence branch: what is the difference between your and other general branches? How could you justify that?

5. How do you motivate employees of your branch? 6. Special characteristics of your branch? 7. What is the scope of business in your area of operation? 8. Is Dynamic Budgeting Method better than old budget settlement one? Give reasons for

your answer. 9. What is your branch’s market share in the district? Is it improving or declining?

Reasons? 10. Who are your competitors? Your business strategies to beat competition? 11. Top 5 Borrowers, Depositors & NPA accounts of your branch. Your strategies regarding

all these three? Also, name five top non-customers in your area of the branch. 12. Misc. business & misc. income in your branch and your strategies to increase it. 13. Why fee based income is assuming importance in recent years? 14. Which are the 5 big proposals handled by your branch? 15. Any special achievement of your Branch? 16. Your strategy to reduce NPA of your branch? 17. How do you involve staff in business development? Whether bank has also taken any

steps in this regard? 18. What is meant by ‘money laundering, smurfing & money mule’? 19. What are the latest KYC guidelines? Is KYC a hindrance to business development? 20. Is BPR system/ SWO system working effectively in your branch? 21. Is your branch is in operating profit? If yes, your strategy. If not, reason?


22. Efficiency ratios of the branch? GRR of the branch? Increase/decrease in which ratio is considered better?

23. Is IBTS working well in your branch? 24. Are you working on “LOS”? Is it better than “Dream Home”? if so, how? 25. Do you get full cooperation from your controller? Any example to substantiate? 26. Instructions regarding Note Refund Rules. 27. Recent instructions regarding Lockers, Nomination, Inoperative accounts, transfer of

accounts, etc. 28. Do you think we should promote RTGS, NEFT? Reasons for your answer. 29. Your practical strategies for overall development of the branch? How it is different from

others? 30. Your strategy to improve inspection rating of your branch? 31. Newly created BPR posts: your opinion about their effectiveness. 32. Do you think BPR is stabilized? BPR is helping you or creating problems? Reasons for

your answer. 33. Growing NPA is because of BPR outfits? Your opinion? 34. Effect of ADWDR on loan recovery scenario in agricultural finance? 35. Budget should be the responsibility of CPCs also. Your view? 36. Creation of CPCs has helped branches or not? 37. How do you handle coordination issues with CPCs? 38. ‘Post BPR, branch manager and branch people have nothing to do’. Justify your role vis-

à-vis the statement? 39. Do you think we have more products than required? 40. Biggest challenge/ hurdle branches/staff are facing now a days? Your strategy to deal

with the issue. 41. Your strategy to get the maximum from new recruits? 42. How do you ensure up-time/availability of ATMs of your branch? Present position? 43. Your views about SMS Unhappy, LMS etc. 44. In SBI, team is not working only individuals are. Your opinion and reasons for the

statement? 45. BC/BF/MRT and their effective utilization. 46. How you ensure to prevent frauds in your branch? 47. How to build committed teams? 48. How do you communicate to your staff? 49. Your strategy to improve and maintain harmonious inter-personal & intra-personal

relationship? 50. Customers are not always right. Your views in this regard? 51. Who is more important for you, your boss, employees or your customers? Reasons for

your answer. 52. What are the criteria for Chairman’s Club membership and the Incentive scheme? 53. Are we cross-selling in true sense and ethically? 54. How do you make people to listen your view point? 55. SBI Life is deriving more benefit from us than we derive out of them?


56. Even after various alternate channels available to customers, we are unable to decongest our branches. Why? How to improve the situation?

57. Your practical strategy for crowd management. How it is different from others? Is it successful?

58. Customer’s expectations vis-a-vis our service standards: your opinion and reasons for your opinion.

59. There should be budgets for strategic business units also like SMEBU,PBBU in order to

achieve goals of the operation units. Your opinion and Bank’s instructions in this regard.

B. If the candidate is from an Administrative Office/ Regional Business Office:

If you are from Vigilance Deptt: About whistle blowing, vigilance angle, the alertness award, type of vigilances, DPD & Vig. Procedure, Preventive Vigilance leave etc.

If you are from Inspection Deptt.: about RFIA, Various ratings and their details, how do you help branches in improving rating? What is your role actually, position of branch ratings in the Circle, latest guidelines, etc.

If you are from HR wing: how do you justify your role, what is your role actually (controller or enabler)? Difference between P&HRD & HRD?, Any new initiative taken by you in your area of operation, how to motivate employees? About REMBS, Silver Jubilee Award, HRD philosophy, Training Philosophy, how do you assess training needs, how to contain attrition rate? New HRD initiatives of the Bank in recent past; Maternity leave, Special leave to join spouse abroad etc.

Like that please prepare yourself in your core area of operation. You must be thorough in your own field. Prepare yourself on the basis of “MSC principle”, Must: yourself and your domain, Should: about surroundings, related areas, Branch/Unit, Region, Circle, Bank, Could: Banking & Finance World.

- There should be budgets for strategic business units too, like SMEBU,PBBU in order to

achieve goals of the operation units. Your opinion and bank’s instructions regarding this.

- Considering the large-scale changes taking place in the Bank, what do you think should be the role of Administrative Offices? Do you feel present structure of Circle and Regions are good as compared to the earlier structure? Give suitable reasons.

- Several Regional offices have been shifted to their area of operations- effective or creating problems? Elaborate your answer.

- Opening of new branches – beneficial or burden? Reasons for your answer.

- Financial Inclusion: Boon or Bane?


- Your comments on the workings of different cells (SMECCC, RCPC, RACPC, CPC etc). Coordination issues- your experience and strategies?

- Utilisation of BCs/BFs/MRTs members, effective? Give reasons for your answer.

- Do you think growing NPA is a concern in your region? If so, reasons and remedial measures, your strategy? If not, how you tackled the issue?

- Your strategy to reduce operating expenses and earning more misc. income?

- Strategies for overall development of the region.

- Biggest challenge your region is facing? Your strategy?

- Affect of ADWDRS in your region? Recovery position in your region?

- Are we fulfilling the role we are undertaking?

- Do you think that Administrative Offices are over-staffed? SBI is top heavy?

- What changes have taken place in our administrative set-up during the last few years?

What are the changes proposed?

- Administrative offices are profit centers or cost centers?

- Do you think we are spending more time than required at our workplaces? What are


the ways in which we can reduce our time at our workplace?

- As a Controller, when you visit a Branch, what are the things you will give priorities to

take care of the Branch’s smooth & safe functioning? Is there any specific instruction regarding Branch Visit/Inspection?

- What is your strategy to take care of branches and how you derive maximum output

from the branch people?

C. If the candidate is from BPR cell:

- Are we fulfilling this role?

- Do you feel satisfied with your work output/job conditions?

- Do you feel that BPR cells are working as per Bank’s need and as per the needs of the operations? If yes, please explain in brief. If no, suggest measures for improvement.

- Do you feel existence of knowledge gap at BPR cells, branches?

- What measures will you undertake if you have the authority to increase overall

efficiency and working condition of a particular cell?

- What would you suggest for better performance of the operating units?

- Do you think on account of creation of various cells, customer ownership is missing?

- Do you feel there should be budget for CPCs also? If so, how? If not, why? Give reasons to substantiate your views.


- Your opinion and experience about the functioning of BCs/BFs/MRTs/MPST/HLST etc., reasons for your response?

- Do you think growing NPA is due to improper functioning of BPR cells?

- Coordination issues; intra-cell and inter-operations? Your practical strategies for improvement?

- Do you think BPR cells are now well stabilized? Reasons for your opinion. - Dream Home software is better than “LOS”: your opinion & reasons for your opinion. - “LOS” is a LOSS or gain: your opinion and reasons for your opinion.

- Are you satisfied with the pace of development that is going on in the bank? D. If the candidate is from HR wing/ATIs/SBLCs: - Am I fjustifying the present role which I am currently undertaking?

- Impact/Effect of Citizen SBI programme/UDAAN. Give reasons for your reply. Any

memorable event during Citizen SBI programme/UDAAN, please describe. - Difference between a Facilitator, Trainer, Mentor, Coach? You are what among these?

- Is SBI a learning organisation? If yes, how? If no, furnish reasons and your practical

strategies for making SBI a learning organisation. - ATIs/SBLCs are profit centers or cost centers? Give reasons for your answer. - ATIs/SBLCs should be converted into profit centres. If not, why? If yes, how? - Specialization of SBLCs/Trainers is the need of the hour, justify. - What is “SME” in training? ( Subject Matter Expert) - Lateral recruitment of trainers is the need of the hour, justify. - SBLCs are playing their role? Strategies for future roles. - Difference between Knowledge & Learning?

- Details about STU and its impact? New initiatives taken by STU? Difference in Training

system & training imparted, after formation of STU.


- Your strategy to assess & fulfill the needs of the operations/employees. - How do you ensure effectiveness of your sessions? - If any trainee is not giving ear to your words or not listening you, what would be your

strategy? - Credibility of the trainers and training system. - Integration of training system with operations- your practical strategy? - SWOT analysis of HR/Training System. - You are taking sessions on which topics or you are SME in? Expect some questions in

depth from topics of your sessions specially the practical aspect of it. Like, if you say, I take sessions on Marketing, you may expect question on Marketing & Selling, difference between the two terms, what is cross-selling, Up-selling, mis-selling, down-selling?

- When & how you get time to update yourself? - Your special initiatives ? if any. - What is your prescription to the trainees specially the new ones? - How do you maintain discipline during sessions? If one participant is coming late despite

your repeated requests, what would you do? - Profile of Training System & your ATI/SBLC. - How do you calculate capacity utilization? Capacity utilization of your ATI/SBLC for the

last three years? Reasons for rise & fall in it over years. - How do you ensure nomination & deputation of participants for any training

programme? - Do you think STRAPS is sufficient? How & why? - How do you motivate trainees for “eLearning” & how do you ensure they take interest

for the same. - Posting at ATIs/SBLCs is not a challenging assignment: your opinion? - Are you enjoying your assignment/role? How? - How have you added value in your role? - It’s a cozy posting. How you have managed this posting? - About the Project works, Case studies, Book-reviews & Book Condensations, etc. - Training methodology you have adopted and how do you decide which methodology is

better for any particular session and group of trainees. - Trainer-Trainee ratio in your Circle, what is optimum? Your view on this. - How to develop a caring organisation? - Attrition rate is higher in case of new entrants. Your strategy to retain the talent and the

challenges attached to it. - Extent of frauds & corruption in the Banking system. How to deal with the situation,

especially in the light of mass level recruitment, new branch openings and technological advancements.

- Role of HR/ATIs/SBLCs in the present scenario. Your strategies in this regard?


- HRMS – boon or bane? Strategy? - Your strategy to groom new entrants as future leaders? - Mass recruitment- requirement or burden? How to get most from the young

generation? - Emotional & Career counseling of the employees, especially of the young generation? - Integration of new entrants with the culture, ethics & environment of SBI? Your

practical strategy? - Work-life balance: your practical strategy. - Do you think training system is overburdened? If yes, why? How to improve the

situation? If no, justify with special works done by you.

E. Specially for TEGS / SMGS:-

- Operating expenses: position and your strategy to reduce them. What are latest

instructions in this regard? - Technology and Financial inclusion are the need of the hour. Your opinion and

reasons for the same. - “Worst is yet to come”: Your view considering present Indian economic condition. - With mass level retirement in banking sector and in SBI, what would be your

strategy for the future? - Going GREEN is the new mantra. Please discuss Bank’s strategy and your opinion in

this regard. - DGM’s should be posted on locale: Your views & reasons for your views. - New initiatives taken by bank for employees’ satisfaction. - How will you groom new entrants as future leaders? Specially in the light of mass

level recruitments and retirement. - Growth at the cost of bottom-line: your view. - Corporate Social Responsibility: Statutory requirement, Social commitment or

Voluntary effort? Bank’s strategy and your opinion. - “BANCOM” Summit 2011. - Small centers are performing better than the metros. Your opinion in SBI’s context. - BPR cells are the reason for growing instances of NPAs. Your opinion and reasons

behind the opinion. - Monetary Policy highlights: 2011-12, recent review.

- Roadmap for Access to Banking Facility in Every Village by 2012: Committee’s report

& your opinion. SBI’s financial inclusion plan?

- Economic Survey: 2010-11.

- Chairman’s Policy Guidelines: 2011-12.

- Deposit insurance: should it be linked with ‘Risk Profile’ of the Banks?

- BASEL III: are we prepared?

- Budget 2011-12: highlights.


- Financial inclusion: Need of the hour or burden on banking system?

- Infrastructure Finance Companies & their role, issues involved in Banks’ financing to

IFCs/Infrastructure?

- Base Rate System for Bank loans: Effects on banks’ profitability. Opinion and reasons

for opinion.

- Increase in SB rate and its impact on SBI: your opinion.

- Deregulation of Intt. Rates: your opinion.

- Modification in “Lead Bank Scheme”: Effects on the Banking System.

- There should be budgets for strategic business units also, like SMEBU,PBBU in order

to achieve goals of the operation units. Your opinion and bank’s instructions

regarding this.

- Cash Processing Centres? - Trading of “Currency Futures” in India: benefits and effects.

- Effects of commodity trading: your opinion and reasons for your opinion.

- Financial Stability Unit?

o FINANCIAL STABILITY & DEVELOPMENT COUNCIL

New apex level Financial Stability and Development Council proposed to be set

up to strengthen and institutionalize the mechanism for maintaining financial

stability. This Council would monitor macro-prudential supervision of the

economy, including the functioning of large financial conglomerates, address

inter-regulatory coordination issues.

- Fiscal Consolidation- Fiscal consolidation is a policy aimed at reducing government

deficits and debt accumulation. As per the Prime Minister’s Economic Advisory

Council (EAC) it is necessary to initiate measures towards fiscal consolidation to

ensure fiscal sustainability, enable greater flexibility in monetary policy calibration,

contain interest payments and to avoid upward pressure on interest rates. Without

fiscal consolidation the growth which the economy has achieved will not be

sustainable.

- Report of G20 Working Group: Enhancing Sound Regulation and Strengthening Transparency .

- Report of “Working Group on CGT-MSE”.

- M Damodaran Committee report on Customer Service


- A K Khandelwal committee (on HR issues) report and its likely impact on banking

industry.

- IT Vision :2011-17

- SBI Amendment Bill 2010- salient features.

- “UID” project- AADHAR? Swabhimaan?

- Should SBI charge royalty from its associates/subsidiaries?

- KYC guidelines: recent changes?

- IFRS: impact & benefit. Also CFSA?

- Need for “STU”? Impact of it.

- Revamp of training system in SBI: required?

- We have launched/started many initiatives but implementation thereof is not up to

the mark. Why? Your opinion.

- Concerns of the Bank for FY 2011-12?

- Your strategy to make SBI one among top 50 banks in the World?

- Training centers should be investment centres or profit centres?

- Outsourcing of training activities: required? Useful?


- What is “CAFRAL”: (Centre for Advanced Financial Research & Learning)

- Effect of teaser rates on SBI. Should it be continued? Your opinion.

- It is difficult to keep high morale of the employees, especially in the light of

perceived inadequate salary package: your opinion.

- Technology – enabler or a big challenge, in the context of SBI.

- Is SBI a learning organisation? If yes, how? If not, reason and your strategy to make

it so.

- Merger of Associate Banks with SBI- need of the hour or burden? Banks view and

your opinion on this.

- Infrastructure lending – responsible for ALM mismatch. Your view on employees’

knowledge & skill up-gradation for infrastructure lending.

- Everybody is giving thrust on CASA. What level of CASA is sufficient for the bank?

- Are you satisfied with the way we are doing cross-selling? Or is it mis-selling?

- What is “Volker Rule”? (Separation of investment & commercial banking). Is it

suitable for India?

- STRIPS? –(Separately Traded Registered Interest and Payment Securities).

PROMOTION APPRAISAL FORM (PAF)

Promotion to : SMGS-V

BIO-DATA

Name in full: ___________ ________________ ____________

PF Index Number: __________

(Surname) (first name) (Middle name)

Date of Birth : ________ Age as on prescribed date : Yrs___ Mths ___

(dd/mm/yyyy) (eg:01-04-.... for PY ......)

SC/ST/OBC/Mino/Gen _____________ If Religious Minority specify: ______________

Academic Qualifications: _____________________ Position regarding CAIIB : ________

Other professional Qualifications: ___________________________

Entered the Bank as : _____________ on : ______________


Entered Officer’s cadre as :_______________ on : ______________

Extension in Service; Date when last due : sanctioned upto

Statement of Assets & Liabilities submitted upto : 31st of March _______

Present Grade : _____________ Since ______________

No. of Chances :

(Beginning from promotion year .............) Certified having entered in service sheet.

Period Served in various Assignments

Rural : Years ______ Months _____ Semi-Urban : Years ______ Months _____

Line : Years ______ Months _____ Independent Line : Years ______ Months______

Exemption, if any permitted, from rural/semi-urban/line/operational assignments :

Period for which exemption permitted Assignment exempted

Foreign Assignment : Years ____ Months ___

Assignments held, from current to backwards (covering at least 5 years)

S.No Assignment/Designation Branch/Office From To date

1

2

3

Extra-ordinary leave on loss of pay

Period of leave Reasons for leave

- counting for service : ___________ __________________________

- not counting for service : ___________ __________________________

Sick Leave taken since last promotion :


Year Number of Days (Full Pay) Nature of Illness (to be indicated only where

period of leave exceeds 14 days on one occasions

Present State of Health : NORMAL/__________________

Whether health wise able to proceed on transfer : Yes/No

Details of pending/contemplated Vigilance/ Disciplinary Case(s)/ Adverse features, if any

(Please give brief details of the case and the date when initiated)

Sealed Cover Procedure

5. Date since when the officers promotion is under sealed cover procedure :

6. Date of charge-sheet/suspension :

7. Nature of irregularities/ lapses attributed to the officer :

8. Present position of the enquiry/ disciplinary proceedings :

Any Special Achievements since previous promotion :

Appropriate Authority’s Special Remarks/recommendations, if any

Summary of Annual Appraisal Report

(Best 4 AARFs of the last 5 years but of the same grade, starting backwards from promotion

year)

Years Reporting Approval Reckoned as best 4(Y/N)

1

2

3

4

5

TOTAL OF THE REPORTS CONSIDERED (Max 400) ‘A’

Effective weight for promotion : [ (A * 40/400) ] (Max. 40) ‘B’


Reasons for major variations, if any, in AARFS in score awarded by

Reporting/review/approving authorities :

It is certified that reviewed AARFs of the above years are properly drawn up and no

inconsistencies observed therein.

(Dy. General Manager & CDO/ Head of the Department for CC/establishments)

Date :_________________

Place__________________________

Recommendations on attributes (To be rated by ISC in whole numbers)

Score

Max. Marks

a) Ability for proactive action 2

b) Variety of Assignments 2

c) Vision & execution capabilities 2

d) Problem Solving & Decision Making 3

e) Team Building & Motivation 3

f) Customer & Marketing Orientation 3

Total ‘C’ 15

Max. Marks Score

AARF Score ‘B’ 40


Recommendations on attributes ‘C’ 15

Recommendations on potential to shoulder higher responsibilities ‘D’ 15

Recommendations on overall suitability for promotion ‘E’ 5

TOTAL PAF SCORE (B+C+D+E) 75

Signature :

Name:

Designation :

[ C H A I R M A N ]

Signature : Signature : Signature :

Name: Name: Name:

Designation : Designation : Designation :

[ O T H E R M E M B E R S ]

Note : PAF will carry a Maximum score of 75 out of which:

AARFs marks for the relevant years will be converted to out of 40 & Recommendations on

attributes/potential/suitability will carry a combined weight of 35.

PAF in respect of Promotion to SMGS-V to be signed by an Internal Screening Committee.


Date :_________________ Place__________________________

PROMOTION APPRAISAL FORM

Promotion to : SMGS-IV (Effective from Promotion Year 2008-09)

BIO-DATA

Name in full: ___________ ________________ ____________

PF Index

Number: __________

(Surname) (first name) (Middle name)

Date of Birth : ________ Age as on prescribed date : Yrs___ Mths ___

(dd/mm/yyyy) (eg: 01-04-..... for PY ........)

SC/ST/OBC/Mino/Gen _____________ If Religious Minority specify: ______________

Academic Qualifications: _____________________

Position regarding CAIIB : ________

Other professional Qualifications: ___________________________

Entered the Bank as : _____________ on : ______________

Entered Officer’s cadre as :_______________ on : ______________

Extension in Service; Date when last due : sanctioned upto

Statement of Assets & Liabilities submitted upto : 31st of March _______

Present Grade : _____________ Since ______________

No. of Chances :

(Beginning from promotion year 2007-08) Certified having entered in service sheet.


Period Served in various Assignments

Rural : Years ______ Months _____ Semi-Urban : Years ______ Months _____

Line : Years ______ Months _____ Independent Line : Years ______ Months______

Exemption, if any permitted, from rural/semi-urban/line/operational assignments :

Period for which exemption permitted Assignment exempted

Foreign Assignment : Years ____ Months ___

Assignments held, from current to backwards(covering at least 5 years)

S.No Assignment/Designation Branch/Office From To

1 Current To date

2

3

4

5

Extra-ordinary leave on loss of pay

Period of leave Reasons for leave

- counting for service : ___________ __________________________

- not counting for service : ___________ __________________________

Sick Leave taken since last promotion :

Year Number of Days (Full Pay) Nature of Illness (to be indicated only where

period of leave exceeds 14 days on one occasions

Present State of Health : NORMAL/__________________

Whether health wise able to proceed on transfer : Yes/No

Details of pending/contemplated Vigilance/ Disciplinary Case(s)/ Adverse

features, if any


(Please give brief details of the case and the date when initiated)

Sealed Cover Procedure

1. Date since when the officers promotion is under sealed cover

procedure :

2. Date of charge-sheet/suspension :

3. Nature of irregularities/ lapses attributed to the officer :

3. Present position of the enquiry/ disciplinary proceedings :

4. Any Special Achievements since previous promotion:

Appropriate Authority’s Special Remarks/recommendations, if any:

Summary of Annual Appraisal Report

(Best 3 AARFs of the last 4 years but of the same grade, starting backwards from promotion

year)

Years Reporting Approval Reckoned as best 3 (Y/N)

1

2

3

4

TOTAL OF THE REPORTS CONSIDERED (Max 300) ‘A’

Effective weight for promotion : * (A*40/300) + (Max. 40) ‘B’

Reasons for major variations, if any, in AARFS in score :

awarded by Reporting/review/approving authorities

It is certified that reviewed AARFs of the above years are properly drawn up and no

inconsistencies observed therein.

(Dy. General Manager & CDO/ Head of the Department for CC/establishments)

Date :_________________


Place__________________

Recommendations on attributes (To be rated by ISC in whole numbers)

Score

Max. Marks

a) Ability for proactive action 2

b) Variety of Assignments 2

c) Vision & execution capabilities 2

d) Problem Solving & Decision Making 3

e) Team Building & Motivation 3

f) Customer & Marketing Orientation 3

Total ‘C’ 15

Max. Marks Score

AARF Score ‘B’ 40

Recommendations on attributes ‘C’ 15

Recommendations on potential to shoulder higher responsibilities ‘D’ 15

Recommendations on overall suitability for promotion ‘E’ 5

TOTAL PAF SCORE (B+C+D+E) 75

Signature :

Name:

Designation :

[ C H A I R M A N ]

Signature : Signature : Signature :


Name: Name: Name:

Designation : Designation : Designation :

[ O T H E R M E M B E R S ]

Note : PAF will carry a Maximum score of 75 out of which:

AARFs marks for the relevant years will be converted to out of 40 & Recommendations on

attributes/potential/suitability will carry a combined weight of 35.

--PAF in respect of Promotion to SMGS-IV to be signed by an Internal Screening Committee.

Date :_________________

Place__________________________

EES- 1

PROMOTION APPRAISAL FORM

PROMOTION TO TOP EXECUTIVE GRADE SCALE-VI

(DEPUTY GENERAL MANAGER)

PART I

BIO-DATA

(iv) i) Name of the official

(Name in full with surname first) :

ii) P. F. Index No. :

2. i) Date of Birth :


ii) Residual service as on the 1st April of the :

promotion year

3. Qualifications

i) Academic :

ii) Professional (including CAIIB) :

4. i) Joined the Bank as :

on :

ii) Entered Officers. Cadre as :

on :

iii) Date when last extension : was due and granted up to:

iv) Asset & Liability Statement submitted up to :

(v) i) Date of promotion to SMGS-V :

ii) Channel under which promoted to SMGS-V :

(Normal/Fast Track/Appeal)

iii) Total service in the present grade :

iv) Number of chances availed including for the

current promotion year

(vi) Period served in qualifying assignment(s):

Assignment Grade From

To


7.i. (a) Sick leave availed by the official since last promotion:

Period Ailment

(vii) (b) Details of extra-ordinary leave sanctioned during entire service (counting

for service/not counting for service):

Period Reasons

ii) Comments upon status of health of the Officer33 with specific reference to his/her being

able to proceed on transfer upon promotion:

(viii) Assignments held:

(covering all assignments in the grade, minimum 4 assignments – current position backwards):

Sr. No. Position Branch/Office From To

9. Details of pending/contemplated vigilance/disciplinary cases, if any:

PART II

SUMMARY OF AARFs

Year Reported Reviewed Total (out of 100)

III/IIIA IV/IVA III/IIIA IV/IVA

2007-08

2006-07

2005-06

2004-05

TOTAL OF 4 YEARS (OUT OF 400)


(TOTAL EQUIVALENT MARKS (OUT OF 40)

(USE CONVERSION FACTOR *0.10) (A)

General Comments (Section B Form IV/IV-A of AARF)

Year IV As on 31.03.2008

Year III As on 31.03.2007

Year II As on 31.3.2006

Year I As on 31.03.2005

A. ADVERSE REMARKS/FEATURES, IF ANY, IN AARFs:

i) Advised to the officer (details of correspondence to be provided):

ii) Not advised to the officer:

B. BRIEF REPORT ON EXCEPTIONAL PERFORMANCE/ACHIEVEMENT/RECOGNITION:

Certified that all Annual Appraisal Reports compiled for the relevant years have been duly

taken into consideration. All reports are drawn up properly and no inconsistencies observed

therein.

Deputy General Manager & Circle Development Officer/ Head of the Department*

Date: _________________ Place: _____________________

* For officers posted in Corporate Centre/its establishments

PART III

REPORT ON MANAGERIAL CAPABILITIES

(To be rated by the Internal Screening Committee, on a Five-point scale: 5-

Exemplary, 4-Excellent,

3-Good, 2-Above average, 1-AvNumerical marks

1.Creativity/Innovation and Achievement Orientation:

2. Analytical ability and decision making:


3. Communication:

4. Leadership qualities and team building:

5.Inter-personalrelations:

6.Industrial Relations and Human Resources Management:

7. Corporate Image Building and Public Relations:

8. Environmental Awareness and Marketing Skills:

9. Emotional Strength:

10. Role in CMC/CirCC and other Structural Committees:

Total marks (Out of 50)

Total Equivalent Marks (Out of 15) (B)

(Use Conversion Factor *0.30)

PART IV

GENERAL COMMENTS ON POTENTIAL OF THE OFFICER TO SHOULDER HIGHER

RESPONSIBILITIES WITH SPECIFIC COMMENTS ON LEADERSHIP QUALITIES

(To be rated by the Internal Screening Committee, on a Five-point scale: 10-Excellent Potential,

8-very good potential, 6- Good potential 4-Capable, Zero-not capable)

COMMENTS:

MARKS FOR POTENTIAL & LEADERSHIP (OUT OF 10) I

PART V

RECOMMENDATIONS ON THE OVERALL SUITABILITY FOR PROMOTION

(To be rated by the Internal Screening Committee, on a Five-point scale: 10-Eminently

Suitable, 8-Most Suitable, 6-Suitable, 4-Marginally Suitable, Zero-Unsuitable)


MARKS FOR OVERALL SUITABLITY FOR PROMOTION (OUT OF 10) (D) __________

TOTAL MARKS SECUREDA+B+C+D) (OUT OF 75) _________

Signature Signature

Name Name

Designation Designation

Signature Signature Signature

Name Name Name

Designation Designation Designation

Date: _________________ Place: _____________________

(For Use at Cadre Management Department, Corporate Centre, Mumbai)

Checked By


Date of Receipt

Entered in Computer by Verified by

GAPs, if any

5 Our Bank

SBI specific questions , Vision, Mission &

values, Awards & Recognition, List of Directors

on the Central Board of State Bank of India

Some of the highlights / recent developments in the recent past in SBI are listed below, and as bankers, we are expected to keep a close tab on these developments:

1. What is “Centre for Advanced Quantitative Finance” : it is being established for imparting training on quantitative finance for handling risks. Going forward, this will merge with SBI leadership initiatives.

2. “SBI Youth for India” initiative. 3. Organisational changes.

4. Annual Report – Various parameters. Analysis of the result.

5. Chairman’s Policy Guidelines.

6. Augmenting Capital.

7. SBI Heritage.

8. BPR – New initiatives taken. Usefulness of the initiatives.


9. Technology Developments – New Products & initiatives/campaigns.

10. Human Resources, Job family, Performance linked incentive schemes, Huge Recruitment

drive, Employees participation, HRMS, Silver Jubilee Award, the Alertness Award and Chairman Club etc.

11. Productivity Excellence and leadership development programme.

12. New products introduced in Agriculture, PBBU and SMEBU segments.

13. Operations Risk Policy, Business Continuity Plan, Disaster Recovery Plan, Outsourcing Policies, Acceptable Usage Policies, Compensation Policy etc.

14. Project SME Gyanshala, Krishi-Gyan, NRI Nipun etc.

15. Productivity Excellence Programme, Udaan, Citizen SBI , Jagriti, Parivartan – I & II

16. What is “Banker to every Indian” & “Proud to be an Indian”? Justify this.

17. STU? Communicate………….Collaborate ……………..Change……..(but how?).

18. New business started by the Bank: Wealth Management, Financial Planning, SBI Pension

Fund Pvt. Ltd., SBI Custodial Services, General Insurance business etc.

19. Your Vision for SBI? Your strategy to achieve it.


20. Bank’s New Vision , Mission& Value statement (Co-created by SBI employees in 2008)

VISION

My SBI.

My Customer first.

My SBI: First in customer satisfaction

MISSION

We will be prompt, polite and proactive with our customers.

We will speak the language of young India.

We will create products and services that help our customers achieve their goals.

We will go beyond the call of duty to make our customers feel valued.

We will be of service even in the remotest part of our country.

We will offer excellence in services to those abroad as much as we do to those in India.

We will imbibe state of the art technology to drive excellence.

VALUES

We will always be honest, transparent and ethical.

We will respect our customers and fellow associates.

We will be knowledge driven.

We will learn and we will share our learning.

We will never take the easy way out.

We will do everything we can to contribute to the community we work in.

We will nurture pride in India

21. HRD philosophy of SBI


Our HRD philosophy aims at enabling every member of the staff to work as part

of an effective team and to activate his potential with the objective of achieving

the Banks’ goal.

22. Training philosophy of SBI

Training in SBI is a Pro-active, Planned & Continuous process, as an integral part

of the organizational development. It seeks to impart knowledge, improve skill

and re-orient attitudes for individual growth and organizational effectiveness.

23. Bank Day Pledge

24. Evolution of SBI

25. Awards & Recognition

26. Today we have lots of achievements (Rewards& Recognitions). According to you, which are the most important achievements of the Bank? Give reasons for your answer.

27. Is SBI a Learning organisation? If yes, how? If no, your strategy for making SBI a learning

organisation.

28. Reasons for marginal growth in net profit of the Bank in FY2009-10.

29. Concerns of the Bank for FY2010-11.

30. Your strategy to control overheads?

31. Latest Awards & Recognitions received by State Bank of India? Which one is most important in your view? And why that is most important?


List of Directors on the Central Board of State Bank of India

(As on 19th April 2011)

Sr.

No.

Name Designation Under Section of

SBI Act 1955

1 Shri Pratip Chaudhuri Chairman 19 (a)

2 Shri R. Sridharan Managing Director 19 (b)

3 Shri Hemant Contractor Managing Director 19(b)

4 Shri A. Krishna Kumar Managing Director 19(b)

5 Shri Diwakar Gupta Managing Director (CFO) 19(b)

6 Dr. Ashok Jhunjhunwala Director 19 I

7 Shri Dileep C. Choksi Director 19 I

8 Shri S. Venkatachalam Director 19 I

9 Shri D. Sundaram Director 19 I

10 Shri G. D. Nadaf Officer Employee Director 19 (cb)

11 Dr. Rajiv Kumar Director 19 (d)

12 Shri Shashi Kant Sharma Director 19 (e)

13 Smt. Shyamala Gopinath Director 19 (f)

6 General awareness

a. General questions relating to Economy

& Financial System

1. What is “White Label ATM”? : Customers from any bank can deposit or withdraw money

from ‘white-label ATMs’. Their banks then pay for the service. Also, such ATMs are

invariably owned by a third-party, not a bank. At present, under RBI guidelines, ATMs

can only belong to a particular bank. Transactions of customers from other banks are

settled by paying Rs 14 as the charge per transaction by the bank in which the customer


has his account. RBI has been reluctant to allow white-label (or no name) ATMs by non-

banking companies.

2. What is Innovative Perpetual Debt Instrument?

3. DTA : Direct Tax code (going to be implemented by 01st of April 2012.:

The Income Tax Act was passed in 1961. Amended every year through the Finance Acts and interpreted through the multitude of judgments rendered by the courts; it had become incomprehensible to the average tax payer.

All the Direct Taxes have been brought under a single Code and compliance procedures unified. This will eventually pave the way for a single unified taxpayer reporting system.

Simple language, reducing the scope for litigation, and improved delivery mechanisms of the Government.

DTC initiates radical tax reforms. It replaces the over four-decades old IT Act and brings all other direct taxes like Wealth tax under its purview.

4. Small Accounts: With a view to promote financial inclusion, RBI has decided to introduce a new type of simple account aimed at general masses, by the name Small Account. It will have following features:

a) The aggregate of all credits in a financial year does not exceed Rs. 1 lakh;

b) The aggregate of all withdrawals and transfers in a month does not exceed rupees ten thousand; and

c) The balance at any point of time does not exceed rupees fifty thousand.

The Prevention of Money Laundering Rules have been amended to include two more documents as ‘officially valid document’ for establishing identity of the person for Small Account –

Job card issued by NREGA duly signed by an officer of the State Government, and

The letters issued by the Unique Identification Authority of India containing details of name, address and Aadhaar number.

All accounts opened only on the basis of NREGA card or Aadhaar letter should be treated as “small accounts”.

5.PCR : Provision Coverage Ratio? SBIs position.

6. Deregulation of SB intt. Rates: RBI has deregulated all interest rates on deposit and advances of the banks with the only exception that of interest rate on Savings Bank Account which still is regulated by RBI at 3.5%.

With a view to give complete autonomy to banks in deciding their interest rates on deposits and advances, RBI intends to deregulate Savings Bank interest rates


also. The RBI has released a discussion paper on the de-regulation of the rate of interest on saving deposit.

This de-regulation will give rise to more healthy competition amongst banks and this will lead to improvement in efficiency.

As savings deposits are comparatively stable the banks may link them to medium term deposit rates and offer higher rates, thus benefiting the customer.

In the short run, banks may offer comparatively higher rates, however, in the long run they are likely to settle around 5% or so; in tune with 15-45 days term deposit rates.

7. BASEL III Guidelines: The Basel standards are developed by the Basel Committee on Banking Supervision (BCBS), a group within the Bank for International Settlements (BIS) in Basel, Switzerland to ensure safety, soundness and solvency of the banking system. Basel – III is a set of standards and practices developed for internationally active banks to ensure that they maintain adequate capital to sustain themselves during periods of economic crisis. The key objective of Basel III is to tighten the already existing international rules on financial regulation (“Basel I” and “Basel II”), which failed to provide sufficient protection against the financial turmoil. Basel III will require banks to build up extra capital reserves in good times to be used in troubled markets and lessen the need for government bailouts.

Problems with Basel II

a) Capital requirements were too low;

b) There was too much reliance on credit ratings;

c) Banks could use internal models to measure risk;

d) Banks could get around the rules by setting up off-balance-sheet entities;

e) It lacked any kind of liquidity requirements.

Basel- III: Basel III establishes more stringent capital requirements, tripling the amount of

capital that the banks must keep on hand to absorb losses during financial crisis. It requires

banks to maintain higher common equity than before, including a capital conservation buffer of

2.5% of their assets.

8. CERSAI: Pursuant to the announcement made by the Finance Minister in the budget speech for 2011-12, Government of India, Ministry of Finance notified the establishment of the Central Registry. The objective of setting up of Central Registry is to prevent frauds in loan cases involving multiple lending from different banks on the same immovable property. This Registry has become operational on March 31, 2011. The Central Registry of CERSAI, a Government Company licensed under Section 25 of the Companies Act 1956 has been incorporated for the purpose of operating and maintaining the Central Registry under the provisions of the Securitisation and Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (SARFAESI Act).


Some of the highlights / recent developments during the last one year are listed below, and as bankers, we are expected to keep a close tab on these and related developments in the economy. So candidates can expect questions in these areas:

1. GST: Goods and Services Tax (GST) is a comprehensive tax levy on manufacture, sale and consumption of goods and services at a national level. It is collected on value-added goods and services at each stage of sale or purchase in the supply chain, by implementing a tax management software at all levels. The system allows the set-off of GST paid on the procurement of goods and services against the GST which is payable on the supply of goods or services. However, the end consumer bears this tax as he is the last person in the supply chain. Implementation of GST will lead to the abolition of other taxes such as octroi, Central Sales Tax, State-level sales tax, entry tax, stamp duty, telecom license fee, turnover tax, tax on consumption or sale of electricity, taxes on transportation of goods and services etc., thereby avoiding multiple layers of taxation that currently exist in India. However, crude petroleum, diesel, petrol, aviation turbine fuel, natural gas and alcohol for human consumption have been kept out of the GST ambit.

2. India’s success story in present financial crisis position of the world- Sustained growth rate and tasks ahead.

3. GOI , RBI & Banks initiatives to overcome crisis.

4. 11th Five Year Plan (2007-2012). The home loan and may have been

5. Economic & Financial Reforms, Technology, Market and Supervision related reforms.

6. Special Economic Zones, SPZs

7. Comparison between China and India. BASIC Countries?

8. BPLR/Base Rate and its relation to Intt. Rate, Inflation & Economy.


9. Sub-prime Crisis , Global Recession , Greece Crisis, Dubai World Crisis, Retrenchments (Pink Slip, Blue Slip)

10. World Trade Organisation, Negotiations.

11. Globalisation in Indian context.

12. Regional cooperation like SAFTA, Free Trade Areas, ASEAN, ACU

13. Financial Inclusion , financial literacy 14. National Rural Employment Guarantee Programme (NREGP), PMEGP, ISHUP etc. 15. “Caste base census”: what is your opinion? Substantiate your opinion. 16. Illegal earned assets should be declared as “National Property”: your view and Govt.’s

initiatives in this regard? 17. Jan Lokpal bill: solution of corruption in India? Your view? 18. Basel Norms and preparedness for advance approaches under different risks (Credit,

Operational & Market risk).

19. DTAA : DTAA stands for Double Taxation Avoidance Agreement, an act which is about

avoiding taxing the same income twice in two different countries. For example, if a

Britisher is working in India and earning some income, naturally, this will be subject to

tax as per provisions of Indian tax laws. Subsequently, when he remits his income to his

home in UK, it will be again taxed as per tax laws of UK, leading to double taxation of the

single income. To avoid such double taxation, various countries have entered in to

mutual DTAA agreements.

DTAA AND INDIA: India has entered in to such agreements with about 83 countries,

including with Switzerland, recently. Within this framework, India is also trying to obtain

information about bank accounts from about 64 countries. In fact, this type of

understanding has already been reached with about 23 countries. Thus foreigners

working in India will enjoy special status in India and their incomes will not be taxed

twice. Special provisions have been made in this regard in Indian Income Tax Act – 1961.

Section 90 and 91 deal with double taxation.


Other questions that may be expected: i) What is the growth rate India has achieved in recent years? a) Overall b) Agriculture Sector c) Manufacturing Sector d) Services Sector e) Technology ii) What is the targeted growth rate during the next 5 year Plan? Last year revised estimate & this year projections? Do you think this is achievable in present scenario? iii) India’s performance in World Economy? iv) What are the roadblocks for achieving high-targeted growth rate? v) What do you think are the reasons behind India’s economic stability? vi) How does our growth story compared with that of China & other BRIC/BASIC countries? vii) What are our strong points and weak point’s vis-à-vis China? viii) Foreign Trade Policy viii) What is Gross Domestic Product?

- What is Gross National Product? - What is the Difference between Gross Domestic Product and Gross National Product?

ix) What is Per Capita Income Growth Rate? Per Capita Income? x) Literacy Rate? xi) Poverty Line? xii) India’s position in World in “PPP”, Country rating? xiii) How are Inflation and Interest Rate Related? xiv) What is Revenue Deficit? xv) What is Fiscal Deficit? xvi) What are Ways and Means Advances? What is Market Stabilization Scheme?

Ways and Means Advances (WMA) are temporary advances (overdrafts) extended by RBI to the Govt. Section 17(5) of RBI Act allows RBI to make WMA both to the Central and State Govt. The


basic objective of WMA is to bridge the interval between expenditure and receipts. WMA are not a sources of finance but are meant to provide support, for purely temporary difficulties that arise on account of mismatch/shortfall in revenue or other receipts for meeting the Govt. Liabilities.

WMA have to be periodically adjusted to enable use of such financing for future mismatches. RBI under its credit policy, helps the States banking with it to tide over temporary mismatches in the cash flow of their receipts and payments.

TYPES OF WMA: There are two types of WMA namely

a) Normal b) Special

Normal WMA are clean advances whereas Special WMA are secured advances provided against the pledge of Government of India dated securities. The operative limit for special WMA for a State is subject to its holdings of Central Government dated securities up to a maximum of limit sanctioned. In addition, the RBI has determined limits for normal and special WMA for each State as multiples of the prescribed minimum balance required to be maintained with the RBI by that State. These limits have been revised periodically.

BACKGROUND: WMA was started on March 26, 1997, when Govt. Of India and RBI signed an agreement putting the ad-hoc T-bills system to end w.e.f April 1, 1997. The interest rate on WMA is at or around bank rate (with small adjustment for different kinds of WMA for State Govt.) and overdrawing if any carries 2% higher interest. The duration is 10 consecutive working days for Central Govt. And 14 days for State Govt. The amount of ceiling limits on WMA are fixed at the beginning of a fiscal year by RBI.

LATEST GUIDELINES: RBI in consultation with the Government of India has decided that the limits for Ways and Means Advances (WMA) for the financial year 2011-12 would be:

Rs. 30,000 crore for April 01, 2011 to April 20, 2011

Rs. 45,000 crore for April 21, 2011 to June 30, 2011

Rs. 30,000 crore for July 01, 2011 to September 30, 2011

Rs. 10,000 crore for October 01, 2011 to March 31, 2012

OTHER IMPORTANT ASPECTS:

a) The Reserve Bank may trigger fresh floatation of market loans when the Government of India onceptu 75 per cent of the WMA limit.

b) The Reserve Bank would retain the flexibility to revise the limits at any time, in consultation with the Government of India, taking into consideration the prevailing circumstances.


c) The interest rate on WMA/overdraft will be: i) Ways and Means Advances: Repo Rate; ii) Overdraft: Two percent above the Repo Rate

d) The minimum balance required to be maintained by the Government of India with the Reserve Bank of India will not be less than Rs.100 crore on Fridays, on the date of closure of Government of India’s financial year and on June 30, i.e., closure of the annual accounts of the RBI and not less than Rs.10 crore on other days.

e) As per the provisions of the agreement dated March 26, 1997 between the Government of India and the RBI, overdrafts beyond ten consecutive working days will not be allowed.

MONITORING OF WMA: The position of WMA actually onceptu and overdrafts of various States is closely monitored in the Internal Debt Management Cell (IDM Cell), RBI, on a daily basis on receipt of the position from Central Accounts Section (CAS). When a State avails of WMA in excess of 75 per cent of the aggregate limit (aggregate = normal plus operative limit for special WMA), the State is cautioned to take remedial measures to avoid emergence of overdraft in its account. Whenever a State, after availing of normal and special WMA, emerges in overdraft, the IDM Cell conveys the position of its overdraft to the concerned State on a daily basis, with a request to clear it within a period not exceeding ten consecutive working days. If the account of a State continues to be overdrawn on the eleventh continuous working day, the RBI suspends payments on behalf of the State until the overdraft is cleared.

SURPLUS INVESTMENTS: The RBI acts as the sole agent for investment of the State’s surplus funds. Surplus cash balance of a State beyond a level indicated by it is automatically invested in 14-day intermediate Treasury bills. The States are also free to participate in 14-day and 91-day Treasury bills auctions as non-competitive bidders for investment of their durable surplus.

xvii) What is the Concept of SEZ? From which country have we borrowed this model? xviii) What is Infrastructure Finance Company (IFC)? xix) What are the norms for funding IFCs? xx) What is LPG in the context of Economy? Ans: LPG stands for Liberalisation, Privatisation and Globalisation

- What is Liberalisation?

- What is Privatisation?

- What is Globalisation?


xxi) What is Glocalisation? Indicative Answer: Thinking Globally and Acting Locally. xxii) What is BSE index, NSE, MCDEX, NASDAQ? How many shares does BSE index constitute of? What is Bankex ? xxiii) What is Demutualisation? Indicative Answer: It is the process of changing a mutual or cooperative association (say a Mutual Fund or Stock Exchange) into a Public Company by converting the interest of members into shareholding. Such shares can be traded like the shares of the company. Note: Bombay Stock Exchange demutualised itself for today’s structure. xxiv) What are the reasons behind the current share prices movement in the Market? xxv) What is Currency Future/ Interest rate future? xxvi) What is a Green Shoe Option? xxvii) What is a Red Herring Prospectus? xxviii) What is a Green Field Project? What is a Brown Field Project? xxix) What is Exchange Traded Fund? xxx) What is Book Building? xxxi) What is IRR ? xxxii) What is Price Earning Ratio? xxxiii) What is Yield? xxxiv) What is Yield to Maturity? xxxv) New Project of TATAs & impact on Indian Car market. xxxvi) What is leveraged buyout? (This is how Tata’s acquisition of Corus was structured). It is a transaction where the cash flow or assets (or both) of the company that is being acquired is leveraged, i.e., money is borrowed against these – to take over the firm. LBOs can be done if the acquirer takes a major stake in the company, meaning over 51%. Consider a $500 million buyout. In a common LBO structure, the acquirer floats a Special Purpose Vehicle (SPV) overseas and chips in with, say, $150 million as equity and borrows the rest. The company being taken over is a subsidiary of the SPV. Later, the SPV or the holding


company can be merged with the company that is being acquired, so that the SPV’s loans become the loans of the company. LBOs are thus on a non-recourse basis to the acquiring company. If the company that is being acquired goes bankrupt, the acquirer will not have to bear the liability. LBO financing could be between 3-9 times EBDITA (Earnings before Depreciation, Interest, Tax and Amortisation) depending of the sector and cash flow. Typically, it is between 3-5 times. xxxvii) How are oil prices affecting Global Economy? xxxviii) What is Philips Curve? After the Second World War, practical economists noticed that as unemployment fell in many

advanced economies, inflation tended to rise and vice versa. This relationship between

inflation and unemployment became known as ‘Philips Curve’. Edmund Phelps, however,

argued that there is a natural rate of unemployment. That is some people would always be

unemployed. This is because of structural rigidities in the labour market. For example, a 55-

year-old machinist cannot become a computer wizard!! (The dilemma of Indian banks too!!)

7 Banking Scenario

General Banking related questions with

special emphasis on Indian Banking

Some of the highlights / recent developments during last one year in the area of General Banking are listed below, and as bankers, we are expected to keep a close tab on these developments. Important Developments, Recommended Readings:

1. RBI’s Monetary Policy, Interest Rate changes , Interest Rate Concessions

2. Basel II and its implications, present state of preparedness for advance approaches.

3. Risk Management, Different type of Risks and its impact on working of banks.

4. Mergers & Acquisitions

5. Banking by Alliances, Collaboration (2 or 3 Banks coming together – Sort of partial


merger), merger of SBI associates

6. Financial Inclusion, Financial Education

7. Banking Codes and Standards Board of India (BCSBI)

8. Banking Ombudsman Scheme (2006)

9. Right to Information Act

10. Payment and Settlement System Act 2007

11. Recent budget proposals relating to Banking Industry

12. Restructuring/Rehabilitation of bank advances- its impact on performance of Banks &

economy. What is right to recompense?

13. Banking reforms, Technology in Banks, Risk Management in Banks etc.

14. Public Sector Banks Vs Private Sector Bank & Foreign Banks

15. Performance of banks (yearly results have been announced)

16. Treasury Performance, Yield, concepts like Mark to Market ,HTM, HFT and AFS


17. Islamic Banking

18. CIBIL , CCIL , Pension Reforms, Companies related new issues ( LLP) etc.

19. MCA-21 Project on e-Governance

20. Corporate Governance & SBI initiatives in Corporate Governance

21. RBI Policy Guidelines – Branch Authorisation, Business Facilitator and Correspondent

Model , Mobile Banking, Door-step banking, Pre-paid Instruments etc.

22. KYC & AML latest guidelines.

8 Readings

Chairman’s statement & interviews. Important articles that have appeared in Bank’s official publications/Newspapers

Look to position SBI among top 50 banks in the world: Pratip Chaudhuri, SBI Chairman: For the new chairman of State Bank of India , it has been a baptism by fire. Weeks after taking over, it was left to Pratip Chaudhuri to unveil the bank’s results for the quarter to March 2011, which stunned the Street and led to a re-rating of the stock. With a large part of the cleaning-up of books behind him, Chaudhuri spoke to ET’s Sangita Mehta, Shaji Vikraman and Bodhisatva Ganguli on what to expect from India’s largest bank in the year ahead. Edited Excerpts:

http://economictimes.indiatimes.com/state-bank-of-india/stocks/companyid-11984.cms


What were the compulsions that necessitated such a huge clean-up of the bank’s books and huge provisions? Was it a legacy issue and was it driven more by the regulator? I think it is a question of accumulation. We could see it coming. The one-time hit was the . 500-crore provision for teaser loans . There was deliberation at the end of the third quarter that a provision should be made. Our auditors were insistent that this provision be made but the bank management persuaded them to believe that possibly it should be feasible to get a favourable dispensation from the RBI. It does not depend on the quality of the asset but the view that the RBI takes. The RBI said that all teaser loan build-up has to be provided for. Possibly, they were unhappy with us that inspite of giving so many signals, we chose not to discontinue with the teaser loan and even on March 31, we chose to extend it by one month. Maybe, it was the RBI’s way of saying that if you are not falling in line or disciplining your ways, this is our way of disciplining (you). So . 500-crore provision was for that, and Rs. 3,500 crore is the total provision to reach the 70% provision coverage ratio. Of this, we have provided for . 2,330 crore, and we have time to provide it (for the rest) by September this year. These are not linked to delinquencies of assets . These are RBI-mandated provisions. Had it been done earlier, it would have been better. But if you don’t do it earlier, you do it later. So there was a backlog. Now, the provision for pensions is something which is relatively difficult to explain. Because 2007 was when the wage revision was due, and it concludes with a lag and it happened in 2010. We should have anticipated that. Along with wage comes the pension component not only for the retired but also for serving employees and that should have been provided for at least in some measure . Either you amortise, and that leads to doubts in the minds of analysts that they (SBI) are pushing it for posterity and not facing the situation today. Since there was not enough profit, the choice was to draw from reserves.

SBI hopeful of nod for rights issue this fiscal Business Line Wednesday, May 18, 2011

State Bank of India is hopeful of getting the Government’s nod for its rights issue by the second or third quarter of the current fiscal, according to its Chairman, Mr Pratip Chaudhuri. “The Government had asked us to submit the revised rights issue proposal post the March 2011 results. We will soon submit our proposal and are hopeful of receiving their communication by the second or third quarter of the current fiscal,” Mr Chaudhuri said while talking to newspersons on the sidelines of a press conference to announce the bank’s annual results here on Tuesday. The bank plans to raise about Rs 20,000 crore by way of rights issue. “There will not be any


difficulty getting capital. Our bank was not accommodated last year so it (capital infusion) has spilled over to this year. We are in talks with the Government and are hopeful that it will subscribe to full 59 per cent,” he said. Meanwhile, SBI is looking at onceptual its capital and looking at assets that require less capital. The bank is sitting on ample liquidity and has a comfortable capital adequacy ratio of 11.98 per cent which could support a growth of about 20 per cent during the current year, he observed. The loan growth during the current year could be lower than the targeted rate of 20-22 per cent. “With the rise in interest rates, there could be some moderation in growth of assets. We are not pushed to the wall for loan growth. We might also have to contain asset growth if the rights issue does not come through,” he said. The bank would also lay an increased thrust on the corporate sector, he added. Lending to microfinance Talking about lending to the microfinance segment, he said, “Microfinance companies will have to fend for themselves. We will lend if they are adequately onceptuali otherwise we can also do a good job in direct lending ourselves.” On the international front, the bank’s asset book grew by 13 per cent during the current year and it was hopeful of achieving about 12-15 per cent growth during the current year.

State Bank of India finally yielded to the banking regulator Reserve Bank of India’s instruction to provide more provisioning for its special home loan scheme on Tuesday. The additional R500 crore it showed as standard assets provision for its discounted home loans has shaved off about 27% from its net profit. The allocation was expected by the market, after new chairman of the bank, Pratip Chaudhuri, decided to close the scheme on April 30, 2011.

The provisioning also brought to an end the competition that had been set up in the housing loan market by relatively new entrant SBI to garner more market share and also expand the market from early 2009.

While the allocation grabbed attention, Vaibhav Agarwal, vice-president, research at Angel Broking, said more than this one-off allocation, a greater concern was the slippage in the tier-I capital of the bank to below the benchmark of 8% (7.77%).

It has worried analysts as this will put greater pressure on the bank to raise capital, Agarwal said. The slippage is due to a R7,927 crore provisioning made towards pension fund on account of wage revision.

To gather numbers in the market, SBI had set an ‘invitation’ interest rate of 8% for the first


year and 8.5% in the next on housing loans. For the rest of the tenure it carried floating rates. The scheme attracted attention with other banks and housing loan companies, too, following suit. India’s largest bank disbursed around R40,000 crore over two and half years under this scheme to grow its retail housing loan portfolio aggressively.

A concerned RBI had raised the provisions against such special loan, which has both fixed and floating rate payment system, five fold — from 0.4% to 2% late last year.

But former chairman of SBI, OP Bhatt, who retired in March had declined to make any provision on teaser home loan, claiming the bank took into consideration a customer’s capacity to service the loan when the rates go up while giving such special loans. Since there were the same risk of default, as any standard loans, SBI argued there was no need to make the extra provisioning.

As per the latest balance sheet of the bank, its home loan portfolio has risen by 21.88% to R86,769 crore as on March 31, 2011, from R71,193 crore the year before.

We will try to retrieve some lost ground in corporate banking’ Business Standard Friday, May 13, 2011

It’s not easy to single out Pratip Chaudhuri, the unassuming new chairman of State Bank of India (SBI), from the suit-clad crowd of delegates at the Asian Development Bank’s annual meeting, held in Hanoi recently. In an interview with Devjyot Ghoshal, the helmsman of the country’s largest lender outlines his strategy for keeping SBI ahead. Edited excerpts: There has been the description of making the elephant dance’ with regard to your predecessor O P Bhatt. What will be your set of priorities for taking the bank forward? It will not be a dramatic shift. At one time, people almost wrote off public sector banks and thought private sector banks would be the banks of the future. Mr Bhatt made a signal contribution in correcting that and in repositioning public sector banks as banks of certain substance. Simultaneously, one good thing is that we have narrowed the technology gap with private sector players. The 100 per cent core banking has positioned us almost on an equal footing with private sector banks. So, we don’t have the technology handicap. I think in the last three years, he (Bhatt) also did a good thing by restarting opening of new branches. For 10 years, we didn’t undertake branch expansion, fearing we did not do any recruitment. That vicious cycle was broken. We recruited more people, and that helped us expand our reach. It was important because most Indian towns and cities were expanding in new areas and our presence was largely confined to the old areas. Unless we have good presence in the new areas, where the relatively young and affluent people who own new houses are moving to, we will be left out in the cold. But what will you specifically focus on? There is a certain feeling that we have done very well in retail, home and car loan markets. In home loans, we have become the leader in absolute and aggregate terms. In retail, at least on an incremental basis, we are the leader,


or maybe we are very close to it. But, possibly, we have slightly neglected our corporate banking franchise. Our endeavour will be to retrieve some lost base. Then there are areas we didn’t enter because maybe we thought they were not very important. But from a headline point of view, I think they are important. What are these areas? Areas like bond underwriting and distribution. Though relatively small compared to the loan market, it is largely dominated by Axis Bank and YES Bank. We would like to position ourselves in this. There were some human resource concerns. What is the current situation? There were concerns in a number of areas. One was the average age. That has been corrected to a large extent with youngsters coming in and more older people retiring. But the kind of people we are getting is important because we also have a rural network. You may get good people but they may not be willing to relocate to rural areas. And today, banks not only have to deal with deposits and loans, they also have to offer insurance. Our young people need to learn new skills. What about the status of non-performing assets (NPAs)? A lot of good things have happened but one area where we have possibly trailed other banks is our net NPAs to total assets. We are higher than the median. We are trying to put more energy into this. We have put a deputy managing director-level officer in charge of this, expecting a better and faster resolution of NPAs. Will there be a focus on long-term loan assets? For a company, if you do working capital lending, the price is X’. To the same company, the price of a term loan is X +’. In lending, with new regulations, we also have to look at the capital required. Broadly, if you lend to a company which is top-rated, say AA, the capital required is less. But as you go down the credit spectrum by lending to an unrated company, the capital required is significantly higher. I am saying that to the same AA-rated company, when you lend working capital and when you give a term loan, the returns from the latter are higher. By and large, in India, most term loans are against the security of fixed assets. With new legislation like the SARFAESI Act, the lenders are not all that helpless. You get a longer tenure, a higher yield and possibly, at a broad level, the nature of the security is also relatively better. Before the monetary policy, SBI did say that a rate increase will hit the growth momentum. What is your reaction to the policy announcement? The governor himself said the choice was between inflation and growth and after considering all pros and cons it was decided to target inflation first. But in doing that they are aware that there is a trade-off between the two and that it may lead to some deceleration in growth. Will this have any impact on SBI because there has been some concern about margins? I


think it would have a greater impact on the term-loan capital asset funding because (for) working capital people have to go on. Second, on the working capital side, large companies can always resort to external commercial borrowings, which are pretty cheap. But for a house-owner or a car-owner, it will be different. For example, EMIs of 12,000 and 15,000 are materially different for a middle-class person. We have seen in the past that if EMIs go up very sharply, there is deceleration in demand. I think a major impact could be in the real estate sector. What are your views on new banking licences? We should not be seen as trying to stop others from getting licences. We should not be seen as being protectionist. But this is slightly unusual if you consider that globally industrial houses are being given banking licences, and as the past bears out, industrial houses have not been very successful in implementing them. Banks which have been successful are the ones which have been promoted by groups or companies in financial services businesses. And these groups do not have any other allied interests in manufacturing or trading. We don’t mind other people coming in but the banking industry is already very fragmented. Any bank which is below a certain size will have to struggle, which we have seen in our associate banks. What are the plans for international expansion? We pursue growth only if it comes with profit. Growth without profit doesn’t help. We are looking at some jurisdictions. Australia is an important one. Over the last 5-10 years, there has been a significant increase in the number of students and professionals going to Australia. In a branch there, you cannot have a retail deposit of less than A$ 250,000, which is a relatively large amount for an individual, especially a new immigrant. We are getting left out of this major segment. So, we are thinking of opening a subsidiary. Australia, we understand, goes by rules. If you put in $75 million or $100 million, you get a licence for a subsidiary and then you can do branch banking. Also, in the UK, we have got a retail licence. But to do retail business in the UK is very difficult in terms of asset quality, as most delinquencies have happened in home loans. We are taking slightly careful steps, but we have plans to roll out about four branches in London. There is a lot of fascination with Indonesia, that it has good resources and all that, which is true. But that financing can be done from Singapore. How do you see the international business growing? We will not measure it in physical terms. For example, to grow physically from $35 billion to $60 billion is not very difficult. Unlike India, where you have to onceptu deposits, there assets are easy to come by and you can pick up wholesale debt. But the spreads are very thin. Second, our understanding of the risk profile and the risk market may not be very good. Suppose we want to play in the bond market. We must have a detailed understanding of the interest rate movement in those currencies. It takes a lot of expertise to be present in every market, in every sphere. We will stick to our core competency, which is corporate banking, to the extent that it is useful to Indian companies. Of course we will also do some local financing.


SBI says freeing up savings rate may not be necessary Business Standard Wednesday, May 04, 2011

The State Bank of India (SBI) has said that deregulation of savings bank deposit rate may not be necessary, especially when the banks are offering options to swipe the savings bank deposits to fixed deposits. The savings bank deposits in banks in the country are already deregulated in a sense, with the swipe system allowing them to convert the deposits to fixed deposit to enjoy the higher rates, said Pratip Chaudhuri, chairman, SBI. While the customers are availing higher interest rates even now on their savings bank deposit accounts with swipe facilities offered by banks, deregulation of the deposit rates may not be necessary, he added. ‘We have responded to the RBI that deregulation may not be necessary. But we would go along with the decision of RBI,’ said Chaudhuri. The interest rates for savings bank accounts at present are not attractive. Once it is made attractive, around Rs 9 lakh crore of currency available in the economy could be onceptua, he said. There are also chances that with the deregulation, some banks may offer higher rates for deposits in cities and metros while the rural area would not be able to enjoy the benefits. The RBI, at the end of April 2011, released a discussion paper on deregulation of savings bank deposit rate, seeking feedback from banks by May 20. It has pointed out that the deregulation of the savings bank deposit rate, which is at 3.5 per cent, would improve monetary policy transmission. After presiding over a Corporate Social Responsibility (CSR) initiative of SBI by donating Rs 18.5 lakh to The Leprosy Mission Trust India (TLM), he told reporters that with the inflation rate on the higher side, at eight per cent, an increase in interest rates could derail the country’s economy. SBI is in the process of absorbing State Bank of Indore, for which the merger process was started in 2010. Chaudhuri said the merger of some of the other five associates could be expected at the earliest by next year, indicating that it was not an urgent matter. It has merged State Bank of Saurashtra in 2008. For its proposed rights issue of Rs 20,000 crore, the bank is in talks with the government, since the target is upwards of Rs 10,000 crore.

Hike in interest rate may derail growth, warns SBI chief


Financial Express Tuesday, May 03, 2011

Advocating a balanced outlook on economy, the country’s largest commercial bank State Bank of India (SBI) on Monday said that an increase in interest rates may derail the growth prospects of the country.

Right now inflation is something like 8% plus and an increase in already high interest rates can derail the country’s growth prospects. It is not easy, but Reserve Bank will be able to do something very optimum from both ends, SBI chairman Pratip Chaudhuri said on Monday.

Commenting on the the deregulation of savings bank deposits, he said, We are not in favour of deregulation, but adequate incentives for saving bank deposits. We will go with RBI. In our view sent to the RBI we have said deregulation may not be necessary.

On its plans to merger with its associate banks, he said, We are still in the process of absorbing State Bank of Indore. Nothing more and nothing beyond this is happening. We are not in pressure or in any urgent need for the merger to happen tomorrow or day after. The need to merge is well established as it will bring is the synergies and brings in deduplication.

On the proposed rights issue, he said they are still holding dialogue with the the government. We are talking to the government because the total amount required as fund is quite substantial. The dialogue is going on. Since we need upwards of R10,000 crore government needs to make sure what will be the source and what will be the modality, he said.

Chaudhuri also said they have set up a new vertical to reduce bad debts. We have created a new vertical — the Stress Asset Management Group. We are using more technology. We are also deploying more resources for recovery of bad debt and also trying to improve the quality of the origination of our loans, he said.

He said the biggest challenge was to take the bank forward and particularly with regard to the financial inclusion plan and supporting the agricultural sector of the country.

Important articles that have appeared in Newspapers recently Teaser treat torments SBI Telegraph Wednesday, May 18, 2011

Provisioning punctures profit OUR SPECIAL CORRESPONDENT Calcutta, May 17: SBIs successful teaser loans scheme that allowed it to aggressively increase its share in the lucrative home loan market has now come back to haunt the bank by eating into its net profits to the extent of Rs 500 crore.


Indias No. 1 lender today reported a Rs 21-crore net profit for the quarter ended March 2011 compared with Rs 1,867 crore in the same period a year ago, translating into a 98.88 per cent drop. Last November, the RBI increased the provisioning requirement for teaser loans that are given by banks under dual rates a lower lending rate for the first few years and then moving to the prevailing floating rate to 2 per cent from 0.4 per cent. Following the new regulations, while all other banks withdrew their teaser loan offers, the SBI under former chairman O.P. Bhatt continued to offer such loans till his retirement on March 31, 2011. New chairman Pratip Chaudhuri discontinued the scheme in April, but the bank had to make a one-time provisioning of Rs 500 crore in the January-March quarter on such loans though none of the assets under the portfolio turned bad. The SBI has an 18 per cent share in the home loan market with a portfolio of Rs 86,000 crore, of which teaser loans account for Rs 35,000 crore. We are in dialogue with the Reserve Bank of India on a rollback of this hike in provisioning norm for teaser loans and we are hopeful that the RBI will withdraw it, Chaudhuri said after announcing SBIs financial performance for the fourth quarter as well as for the full year of 2010-11. Total provisioning in the January-March quarter soared 82.10 per cent to Rs 6,059 crore from Rs 3,327 crore in the same period a year ago, resulting in a lower net profit. Provisioning for the full year increased 86.47 per cent to Rs 17,071 crore from Rs 9,155 crore in 2009-10. Such a hefty increase was also the result of pension liabilities and huge slippage of loans into bad assets. In 2010-11, SBIs gross non-performing assets increased by Rs 5,791.40 crore. According to Diwakar Gupta, the chief financial officer of the bank, it will have to provide for another Rs 1,100 crore for assets created in 2010-11 over the next two quarters. We will also have to provide for another Rs 500 crore for increase in the provisioning requirement for substandard and doubtful assets and Rs 1,000 crore for restructured assets, Gupta said. Consequent to a wage pact and an amendment to pension fund rules, the bank had to provide for Rs 11,707.11 crore for pensions, of which the past liability (from April 2007 till March 2011) of Rs 7,927.41 crore was provided from the reserves. This led to a decline in capital adequacy to 11.98 per cent at the end of March 2011 from 13.39 per cent at the end of March 2010. Under the current capital situation of the bank, its proposed rights issue has become more


critical. We had proposed the rights issue last year. But because of the paucity of government funds, it spilled over into this financial year. We hope the government will give its nod to the right issue of the bank that it considers the flagship bank and fully subscribe to the proposed rights issue to maintain its shareholding at 59 per cent, Chaudhuri said. Vaibhav Agrawal, vice-president (research) at Angel Broking, said the decline in net profit oncep the only disappointment in the SBI numbers. Net interest margins had gone down 30 basis points on a sequential basis. Agrawal added that the tax outgo was also higher as it could not take advantage of tax deductions against certain expenses which put pressure on its capital adequacy ratio. Another analyst who did not wish to be quoted was of the view that the higher provisioning indicated that the bank was cleaning up its books and this ought to be viewed positively.

The bank’s credit card operations finally turned in a profit after many years of losses. The credit card business (run as a joint venture with GE Capital) provided it a profit of Rs 7.10 crore last year compared to losses of Rs 153 crore in the previous fiscal and Rs 185 crore in 2008-09.

The bank said its customer spends had increased 30 per cent to Rs 6,452 crore. Total customer spends of all credit card customers in the country during the last fiscal was around Rs 75,000 crore.

The last two years have been a period of consolidation for the credit card industry after witnessing a period of high growth in the preceding decade.

But high delinquency of borrowers and poor recovery mechanisms, compounded by poor underwriting of business by various banks and cut-throat competition contributed to great turmoil in the card industry. Delinquency rates were reportedly in the range of 20 per cent plus.

Over the past two years, the top card issuers have trimmed their operations and culled out cards that were creating problems.

As a result, the total number of credit cards which was at nearly 27 million three years ago, dropped sharply to about 18 million cards a year ago. It has hovered around the 18 million-mark for the last one year as companies consolidated their operations and focused on profitability rather than on building market share.

SBI Cards, which currently has about 2.3 million cards, had about 2.6 million cards a year ago. It issued about 0.4 million cards last fiscal but culled out about 0.7 million cards.

Its main competitor, ICICI Bank reduced its card base more drastically from about 7.5 million to about 4 million cards currently.


Banks also began to focus on targeting high net worth customers, trying to increase their spends.

Greater reliance on verification reports of CIBIL (Credit information Bureau) and reducing cash withdrawal limits, reducing credit periods and increasing penal fees were among the steps taken by the banks to limit losses. For some like SBI, it seems to have paid off.

SBI may absorb savings account rate increase Financial Express Tuesday, May 17, 2011

Even if deposit cost goes up in case of deregulation in savings bank rate is implemented, country’s largest bank State Bank of India is unlikely to recover that from its borrowing customers, said A Krishna Kumar, managing director, SBI.

It is also unlikely to increase the minimum balance for the savings accounts in the days of post-deregulation of savings bank rates, unlike some of the private sector and PSU banks which are keen to recover the higher costs of deposits from the borrowers.

ICICI Bank has already said that it will add the cost to its lending rates in case it has to hike the deposit rates after the deregulation of the saving bank deposit rate is allowed by the Reserve Bank of India.

Moreover, SBI will try to abstain from increasing transaction charges to offset the increase in cost. It will, on the other hand, stress more on other incomes to offset the impact.

The deregulation of the savings bank rate is still being discussed. After it is in place, we will look into the measures of how to offset the increased cost of borrowing, said Krishna Kumar.

Talking to FE he said that SBI’s objective has been to encourage use of savings bank for the common man. I do not really believe that we are going to take such drastic steps as we are encouraging use of savings bank for the common man. It does not make any sense to again put up a charge on the customers from that point of view, he said.

Commenting on the return on assets he said that the bank has to use funds more efficiently. In 2009-10, RoA of the bank had fallen to 0.88% from 1.04%. May be in SBI we are not doing as best as we probably can. The way forward is increasing efficiency of our operation and put more emphasis on usage of alternative channels, he said.

Accepting that the bank’s margins will come under pressure while the rates go up, he said, We are trying to prepare our rates in such a way that it does not affect our margins too badly. The SBI, along with its associate banks, is looking at opening another 10,000 ATMs during the financial year. The banking behemoth, along with its associates, has around 25,000 ATMs across the country. It will also open 1,000 branches along with almost 500 in rural areas during this


financial year.

Other announcement of State Bank Of India, BSE Announcements Monday, May 16, 2011

State Bank of India has informed BSE that in exercise of the powers conferred by clause (d) of Section 19 of the State Bank of India Act, 1955 (23 of 1955), the Central Government, in consultation with the Reserve Bank of India, has nominated Shri Rashpal Malhotra (DOB: November 10, 1936) as part-time non-official Director on the Central Board of Directors of State Bank of India for a period of one year and three months with effect from the date of notification of his appointment or until further orders, whichever is earlier

Loans to turn costlier as SBI hikes BPLR by 75 bps Business Line Wednesday, May 11, 2011

State Bank of India on Tuesday took a “large step” to align its deposit and lending rates in the current rising interest rate regime. India’s largest bank upped its short-term (up to six months) deposits rates by 75 to 225 basis points. The bank also raised the benchmark rates to which all its lending rates are linked by 75 basis points. Higher EMIs Following this, existing and new borrowers of SBI will have to pay higher EMIs on their loans. The deposit and lending rate hikes are effective from May 12. The rate hike follows the Reserve Bank of India raising by 50 basis points the repo and the savings bank rates last week. Repo rate, or the rate at which the RBI lends short-term funds to banks, now stands at 7.25 per cent. With the savings bank rate moving up to 4 per cent, SBI had to increase short-term deposit rates. Else, savings deposits would have seen more inflows, thereby skewing the maturity pattern of its liabilities. The highest interest rate hike of 225 basis points is for deposits of seven days to 14 days maturity from 4 per cent to 6.25 per cent. With effect from May 12, the base rate and the BPLR will be 9.25 per cent (currently 8.50 per cent) and 14 per cent (13.25 per cent) respectively.


Benchmark rates still the lowest Even after the increase, SBI’s benchmark lending rates are amongst the lowest in the banking sector due to its vast pool of current account and savings account deposits (CASA). Such deposits constitute about 45 per cent of its total deposits. From July 1, 2010, banks have been lending at a spread over the base rate. Before this, they were lending with reference to the BPLR, at negative or positive spreads, depending on the customer. The RBI directed that banks switch to the base rate system of loan pricing from the BPLR as lack of transparency in the latter hindered transmission of monetary policy signals. Most of the banks such as Punjab National Bank, ICICI Bank, Bank of Baroda, Bank of India, IDBI Bank and Oriental Bank of Commerce have effected a 50 basis points hike in lending rates. Some of these banks also upped the short-term deposit rates.

State Bank Of India has informed the Exchange that the Bank has revised the Base Rate

upwards by 75 bps from 8.50% p.a. to 9.25% p.a. effective from May 12, 2011.

State Bank Of India – Book Closure NSE Announcements Wednesday, May 11, 2011

State Bank Of India has informed the Exchange that the Register of shareholders of the Bank will be closed for transfer of shares from May 24, 2011 to May 28, 2011 (both days inclusive), for payment of dividend for 2010-11, if any, to be considered at Bank’s Central Board Meeting scheduled to be held on May 17, 2011.

State Bank Of India has informed the Exchange that the Bank has revised the Benchmark Prime

Lending Rate upwards by 75 bps from 13.25% p.a. to 14.00% p.a. effective from May

Other announcement of State Bank Of India, BSE Announcements Tuesday, May 10, 2011

State Bank of India has informed BSE that the 56th Annual General Meeting (AGM) of the shareholders of the Bank will be held on June 20, 2011, at the ‘Y. B. Chavan Centre’, General Jagannath Bhosale Marg, Nariman Point, Mumbai 400021 (Maharashtra) for transacting the following business: 1. To receive, discuss and adopt the Balance Sheet and the Profit and Loss Account of the State Bank made up to the March 31, 2011, the report of the Central Board on the working and activities of the State Bank for the period covered by the Accounts and the Auditor?s Report on the Balance Sheet and Accounts.


Inspection report points to lack of asset valuation policy, among other drawbacks

Chennai, May 18:

Regulatory pressure might have forced the country’s largest lender State Bank of India (SBI) to clean up its books and take a massive hit on its profits while announcing its annual results yesterday.

Rising level of bad loans, and consequent provisioning, was cited as one of the main reasons for the dip in the fourth quarter profits of the bank. The amount of gross non-performing loans of SBI has doubled in the past three years from about Rs 12,837 crore in March 2008 to Rs 25,326 crore as of March 2011.

The attempt to hike provisions and clean-up the books, although attributable partly to the change of guard at the top, could have been a consequence of RBI’s displeasure with its NPA management. An inspection by the RBI earlier this year had downgraded about Rs 3,500 crore of assets and suggested additional provision of about Rs 650 crore to be made by the bank.

As part of its annual financial inspection (for the year ended March 2010), that was completed in January this year, the RBI had criticised the bank for a number of deficiencies — including poor systems, lack of proper policies, lack of follow-up, lack of proper staff accountability et al.

Valuation of assets

The inspection report highlighted several defects including the lack of a robust system to

classify accounts as non-performing or otherwise. There was wrong input of data like date of

commencement of repayment of instalments, amount of instalment, moratorium period etc

and many branches had not taken any effective steps to correct the same.

The report said that SBI had not framed any policy for valuation of assets. Without specific guidelines, different valuations (fair value, realisable value and distress value) were used in different cases. It also highlighted procedural issues such as delays in identification of NPAs, irregular housing loan accounts being re-phased by increasing EMIs and reducing the amount of EMIs to retain the account as performing. Valuation of security was not carried out according to prescribed periodicity.

The inspection report also pointed out that no consolidated review of the quick mortality accounts (where accounts turn NPA within a year of sanction) was placed to the top management. The RBI also pulled up the bank for not carrying out any review of its restructured portfolio. It said that some NPA accounts were classified as standard assets; in some cases commercial viability was not examined; while in some cases of commercial real estate, accounts were not downgraded on restructuring.


Similarly, the bank had not placed a review of suit filed accounts to its board. The report expressed serious concern about the review and control of such accounts since the corporate office could not provide necessary details. It also pulled up the bank for not placing any review of staff accountability, its progress, action taken against delinquent staff, checking of vigilance angle, etc to its board of directors.

9 Circulars

“e-Circulars” – Index of Important Circulars (Gist of eCirculars: Hyperlinked)

Index of “eCirculars” FY 2011-12 (up to 14/05/2011

14/05/2011 124/2011 – 12 CS&NB/CS&NB-

M/5/2011 – 12

MOBILE BANKING SERVICE (MBS) : EXTENSION

OF SERVICE TO SME CUSTOMERS

13/05/2011 123/2011 – 12 CDO/P&HRD-

PM/20/2011 – 12

SBI SCHEME FOR APPOINTMENT ON

COMPASSIONATE GROUNDS IN EXCEPTIONAL

CASES

13/05/2011 120/2011 – 12 NBG/BOD-

FMC/8/2011 – 12

FRAUDS IN RETAIL LOANS SANCTION OF BULK

PROPOSALS

13/05/2011 119/2011 – 12 NBG/PBU/PL-

GENERAL/5/2011 – 12

PERSONAL BANKING ADVANCES – ANNUAL

FINANCIAL INSPECTION (AFI) 2010 –

MODIFICATIONS IN LOAN DOCUMENTS

12/05/2011 117/2011 – 12 CDO/P&HRD-

IR/19/2011 – 12

SBI LIFE SWARNA GANGA SCHEME FOR STAFF

(UIN:111N006V02)

11/05/2011 114/2011 – 12 NBG/PB/C&ITU-

DSP/3/2011 – 12

PERSONAL ACCIENT INSURANCE COVER FOR

SALARY PACKAGE ACCOUNTS

11/05/2011 109/2011 – 12 CB/FIBU-PAYMENT

GAT/1/2011 – 12

GEOJIT BNP PARIBAS FINANCIAL SERVICES

LTD(GBPFSL) PAYMENT GATEWAY

11/05/2011 108/2011 – 12 NBG/PBU/HL-HOME

LOANS/9/2011 – 12 SCHEME OF 1% INTEREST SUBVENTION ON

HOUSING LOANS UPTO RS. 15 LAKH WITH

Hyperlinks/Gist%20of%20important%20Circulars%2027032010%20to%2013052011.doc

ftp://10.206.99.31/SBIRD DVD/ag-codified/e-circulars-11-12/0124.pdf












ftp://10.206.99.31/SBIRD DVD/ag-codified/e-circulars-11-12/0114.PDF







EFFECT FROM 01.04.2011

10/05/2011 106/2011 – 12 NBG/ABU/PDM-AGRI

GEN/4/2011 – 12

AGRI BUSINESS: FRAUDS IN RETAIL LOANS-

SANCTION OF BULK PROPOSALS

10/05/2011 105/2011 – 12 IBG/FD/FD-

MISC/18/2011 – 12

FOREIGN EXCHANGE MANAGEMENT ACT, 1999

– IMPORT OF ROUGH, CUT AND POLISHED

DIAMONDS

10/05/2011 104/2011 – 12 IBG/FD/FD-

MISC/17/2011 – 12 PLEDGE OF SHARES FOR BUSINESS PURPOSES

10/05/2011 103/2011 – 12 IBG/FD/FD-

MISC/16/2011 – 12

FOREIGN EXCHANGE MANAGEMENT ACT,

1999- ADVANCE REMITTANCE FOR IMPORT OF

GOODS – LIBERALISATION

07/05/2011 100/2011 – 12 NBG/PBU/LIMA-

SB/5/2011 – 12

INTEREST RATE ON DEPOSITS – SAVINGS BANK

ACCOUNT

07/05/2011 97/2011 – 12 IBG/FD/FD-

MISC/15/2011 – 12

OPENING OF ESCROW ACCOUNTS FOR FDI

TRANSACTIONS

06/05/2011 96/2011 – 12 CCO/CPPD-

ADV/16/2011 – 12 LENDING TO STATE GOVT. PSUS

06/05/2011 93/2011 – 12 IBG/FD/FD-

MISC/14/2011 – 12

OVERSEAS FOREX TRADING THROUGH

ELECTRONIC / INTERNET TRADING PORTALS

05/05/2011 92/2011 – 12 CCO/CPPD-

TUFS/15/2011 – 12

TECHNOLOGY FUND UPGRADATION SCHEME:

COMMITTED LIABILITY FOR INTEREST –

REIMBURSEMENT FOR TLS SANCTIONED PRIOR

TO 28/06/2010

05/05/2011 91/2011 – 12 NBG/PBU/LIMA-

SB/4/2011 – 12

SAVINGS BANK ACCOUNT OPENING CAMPAIGN

FROM 01.05.2011 TO 30.06.2011

04/05/2011 90/2011 – 12 CDO/P&HRD-

PM/15/2011 – 12

STAFF: SUPERVISING LEAVE TRAVEL

CONCESSION (LTC) / HOME TRAVEL

CONCESSION(HTC) CLARIFICATIONS



























03/05/2011 88/2011 – 12 IBG/FD/FD-

MISC/13/2011 – 12

ISSUE OF IRREVOCABLE PAYMENT

COMMITMENT (IPCS) TO STOCK EXCHANGES

ON BEHALF OF MUTUAL FUNDS (MFS) AND

FOREIGN INSTITUTIONAL INVESTORS (FIIS)

02/05/2011 86/2011 – 12 NBG/PB/C&ITU-

DSP/1/2011 – 12

NEW SCORING MODEL FOR XPRESS CREDIT FOR

DSP PMSP ACCOUNT HOLDERS

02/05/2011 84/2011 – 12 NBG/PBU/HL-HOME

LOANS/8/2011 – 12

CENTRAL ELECTRONIC REGISTRY UNDER

SARFAESI ACT 2002 (CERSAI) REGISTRATION OF

MORTGAGE BY DEPOSIT OF TITLE DEEDS AND

SECURITISATION AND ASSET RECONSTRUCTION

TRANSACTION

30/04/2011 83/2011 – 12 CCO/CPPD-

ADV/13/2011 – 12

ASSET QUALITY – ANALYSIS OF QUICK

MORTALITY (QM)

30/04/2011 82/2011 – 12 NBG/PBU/HL-HOME

LOANS/7/2011 – 12

HOME LOANS : PRODUCT CODES W.E.F. 1ST

MAY, 2011

30/04/2011 81/2011 – 12 RABG/RBNFMCFI-

MICROFI/1/2011 – 12

MASTER CIRCULAR – MICRO CREDIT – SHG

BANK CREDIT LINKAGE

29/04/2011 80/2011 – 12

NBG/PBU/AL-

AUTOLOAN/5/2011 –

12

PERSONAL BANKING: CAR LOANS REVIEW OF

INTEREST RATE W.E.F.1ST MAY 2011 NEW

SINGLE PRODUCT NAME : SBI ADVANTAGE CAR

LOAN INTEREST RATE: SINGLE INTEREST RATE

IRRESPECTIVE OF LOAN AMOUNT AND TENURE

29/04/2011 79/2011 – 12 CCO/CPPD-

ADV/12/2011 – 12

RBI-ANNUAL FINANCIAL INSPECTION U/S 35 OF

THE BR-ACT 1949: POSITION AS ON 31.03.10 –

COMPLIANCE WITH RBI INSPECTION REMARKS

29/04/2011 78/2011 – 12 CCO/CPPD-

CDR/11/2011 – 12

CORPORATE DEBT RESTRUCURING(CDR) CELL –

RECOVERY OF HANDLING CHARGES FOR

RESTRUCTURING PROPOSALS

29/04/2011 77/2011 – 12 CCO/CPPD-

INT/10/2011 – 12

INTEREST RATE STRUCTURE: SMALL

INDUSTRIES AND SMALL BUSINESS FINANCE
































29/04/2011 72/2011 – 12 CCO/CPPD-INT/5/2011

– 12

INTEREST RATE STRUCTURE IN BASE RATE

CAND I, SIB AND AGRI SEGMENTS

29/04/2011 71/2011 – 12 CCO/CPPD-

ADV/4/2011 – 12

CREDIT RISK MANAGEMENT POLICY AND

CREDIT RISK MITIGATION AND COLLATERAL

POLICY

28/04/2011 70/2011 – 12 NBG/BOD-KYC/7/2011

– 12

ANTI-MONEY LAUNDERING (AML) /

COMBATING OF FINANCING OF TERRORISM

(CFT) – STANDARDS

28/04/2011 69/2011 – 12 NBG/BOD-KYC/6/2011

– 12

KYC/AML MEASURES – KYC COMPLIANCE IN

RESPECT OF GUARANTORS / SURETIES

27/04/2011 67/2011 – 12 NBG/PBU/HL-HOME

LOANS/6/2011 – 12

CENTRAL REGISTRY UNDER SARFAESI ACT 2002

REGISTRATION OF MORTGAGE BY DEPOSIT OF

TITLE DEEDS AND SECURITISATION AND ASSET

RECONSTRUCTION TRANSACTIONS

26/04/2011 66/2011 – 12 CDO/P&HRD-

PM/14/2011 – 12

STAFF : SUPERVISING SANCTION OF EXTRA

ORDINARY LEAVE TO JOIN SPOUSE POSTED

ABROAD

26/04/2011 65/2011 – 12 NBG/SMEBU-

OPTL/6/2011 – 12

OPEN TERM LOAN – MODIFICATION IN

SCHEME

26/04/2011 64/2011 – 12 NBG/GAD-REV/2/2011

– 12

GOVERNMENT BUSINESS : CBEC,

INTRODUCTION OF NEW ACCOUNTING HEADS

UNDER CENTRAL EXCISE AND SEVICE TAX

26/04/2011 62/2011 – 12

NBG/PBU/PL-

PERLOANS/4/2011 –

12

PERSONAL BANKING ADVANCES – OTHER

PERSONAL LOANS – REVISION IN BASE RATE

W.E.F 25.04.2011

25/04/2011 61/2011 – 12 CDO/P&HRD-

CM/13/2011 – 12

PILOT PROGRAMME FOR ‘SBI YOUTH FOR

INDIA’ : PARTICIPATION OF SBI OFFICERS

25/04/2011 59/2011 – 12 NBG/PBU/HL-HOME

LOANS/5/2011 – 12

MASTER CIRCULAR ON HOME LOANS AS ON

23RD APRIL 2011































25/04/2011 58/2011 – 12 NBG/ABU/PDM-

TRACTOR/1/2011 – 12

AGRI BUSINESS:: FINANCING OF TRACTORS

AND COMBINE HARVESTERS RELEASE OF

COMMERCIAL TEST REPORTS

23/04/2011 57/2011 – 12 CCO/CPPD-

ADV/3/2011 – 12

CIRCLE CREDIT COMMITTEE INSTRUCTIONS

COVERING CREDIT PROCESS

21/04/2011 54/2011 – 12 NBG/BOD-

FMC/5/2011 – 12

OPERATIONAL RISK IN BANK – FRAUDS FILING

OF CIVIL / DRT SUITS IN LOAN ACCOUNTS

20/04/2011 53/2011 – 12 NBG/PBU/HL-HOME

LOANS/4/2011 – 12

PERSONAL BANKING: HOME LOANS REVISED

INTEREST RATES AND PROCESSING FEE W.E.F.

1ST MAY 2011

20/04/2011 52/2011 – 12 CS&NB/CS&NB-

PPI/4/2011 – 12

RUPEE PREPAID CARDS – GIFT CARDS WAIVER

OF ISSUANCE FEE TILL 31ST MARCH, 2012

20/04/2011 51/2011 – 12 NBG/BOD-GB/4/2011

– 12

RATIONALISATION OF SERVICE CHARGES FOR

CHEQUE COLLECTION – OUTSTATION AND

UNDER SPEED CLEARING SYSTEM W.E.F

01.04.2011

19/04/2011 50/2011 – 12 NBG/GAD-

UMEA/1/2011 – 12

GOVERNMENT BUSINESS : E-PAYMENT SYSTEM

FOR PAYMENT OF MCA-21 FEE AND STAMP

DUTY THROUGH ELECTRONIC MODE,

MANDATORY FROM 27.03.2011

18/04/2011 49/2011 – 12 CCO/CPPD-REAL

ESTATE/2/2011 – 12 EXPOSURE TO THE REAL ESTATE SECTOR

18/04/2011 48/2011 – 12 CS&NB/CS&NB-

PPI/3/2011 – 12

ISSUANCE AND OPERATION OF PREPAID

PAYMENT INSTRUMENTS – CLARIFICATION ON

KYC

18/04/2011 47/2011 – 12 CS&NB/CS&NB-

M/2/2011 – 12

MOBILE BANKING SERVICE (MBS) – INSERTION

OF MBS LEAFLETS IN THE WELCOME KITS

18/04/2011 46/2011 – 12 IBG/FD/FD-

MISC/11/2011 – 12

SERVICE TAX ON FOREIGN EXCHANGE

TRANSACTIONS






























18/04/2011 45/2011 – 12 IBG/FD/FD-

MISC/10/2011 – 12

CORRESPONDENT RELATIONS – CANCELLATION

OF AGENCY / RECIPROCAL ARRANGEMENT

18/04/2011 44/2011 – 12 NBG/PBU/LIMA-

ASBA/3/2011 – 12

APPLICATION SUPPORTED BY BLOCKED

AMOUNT – LAUNCH OF WEB BASED MODULE

BY BSE

18/04/2011 43/2011 – 12 NBG/PBU/LIMA-

SB/2/2011 – 12

PERSONAL BANKING – YUVA SAVINGS BANK

ACCOUNT – PRODUCT CODE 1011-1401

18/04/2011 42/2011 – 12 CDO/P&HRD-

IR/11/2011 – 12

INCENTIVE SCHEME FOR MERITORIOUS

CHILDREN OF STAFF PURSUING PROFESSIONAL

COURSES AT ELITE INSTITUTES IN INDIA

EXTENSION OF LAST DATE

15/04/2011 41/2011 – 12 NBG/BOD-

FMC/3/2011 – 12

SUSPECTED FAKE IOI INSTRUMENTS IN

CIRCULATION

13/04/2011 39/2011 – 12 CDO/P&HRD-

IR/10/2011 – 12

STAFF : AWARD LADY EMPLOYEES ADOPTION

OF BEST PRACTICES SANCTION OF EXTRA-

ORDINARY LEAVE IN CONTINUATION OF

MATERNITY LEAVE

13/04/2011 38/2011 – 12 CDO/P&HRD-

IR/9/2011 – 12

STAFF : AWARD LADY EMPLOYEES ADOPTION

OF BEST PRACTICES MEDICAL AID- DEPENDENT

PARENTS

13/04/2011 37/2011 – 12 CDO/P&HRD-

PM/8/2011 – 12

SBI RETIRED EMPLOYEES MEDICAL BENEFIT

SCHEME-II (REMBS-II) EXTENSION OF LAST

DATE FOR EXISTING MEMBERS/EARLIER

RETIREES FOR BECOMING MEMBER OF THE

MODIFIED SCHEME TILL 30.6.2011

13/04/2011 36/2011 – 12 CDO/P&HRD-

CM/7/2011 – 12

STAFF : OFFICERS PROMOTION YEAR 2011-12

PROMOTIONS UPTO SMGS-V OPTION TO OPT

OUT OPTION FOR BEING CONSIDERED UNDER

MERIT CHANNEL (FOR PROMOTION TO MMGS-

II & MMGS-III)
































12/04/2011 35/2011 – 12 IBG/FD/FD-

MISC/9/2011 – 12

US OFAC – CAUTIONARY INSTRUCTIONS

MENTIONING COUNTRY NAME IN ALL

OUTGOING SWIFT MESSAGES

12/04/2011 34/2011 – 12 IBG/FD/FD-

EXPORTS/8/2011 – 12

EXPORT OF GOODS AND SOFTWARE –

REALIZATION AND REPATRIATION OF EXPORT

PROCEEDS – LIBERALIZATION

12/04/2011 33/2011 – 12 IBG/FD/FD-

MISC/7/2011 – 12

ACQUISITION OF CREDIT CARD/DEBIT CARD

TRANSACTIONS IN INDIA BY OVERSEAS BANKS

– PAYMENTS FOR AIRLINE TICKET

11/04/2011 32/2011 – 12 CDO/P&HRD-

PM/6/2011 – 12

STAFF SUPERVISING: REVIEW OF MEDICAL

REIMBURSEMENT SCHEME OF THE BANK

11/04/2011 31/2011 – 12

NBG/PBU/PL-

PERLOANS/3/2011 –

12

DOCUMENTS FOR LOANS AGAINST BALANCES

IN DEPOSIT A/CS

11/04/2011 30/2011 – 12 NBG/BOD-GB/2/2011

– 12

DECLARATION OF HOLIDAY ON 14TH APRIL,

2011 BIRTHDAY OF DR. B.R.AMBEDKAR

09/04/2011 29/2011 – 12

NBG/PBU/AL-

CARLOANS/3/2011 –

12

PERSONAL BANKING: CAR LOAN SBI- TATA

MOTORS LIMITED (TML) JOINT PROMOTION

CAMPAIGN SUBVENTION) TILL 30.6.2011 AT

REVISED RATE 8.99%

09/04/2011 26/2011 – 12 NBG/SMEBU-

SMECFL/2/2011 – 12

SME COLLATERAL FREE LOANS(SMECFL)–

REVISION IN INTEREST RATES: NEW PRODUCT

CODES.

09/04/2011 25/2011 – 12 IBG/FD/FD-

MISC/6/2011 – 12

SERVICE TAX ON FOREIGN EXCHANGE

TRANSACTIONS

08/04/2011 23/2011 – 12 CDO/P&HRD-

IR/5/2011 – 12 STAFF :: AWARD PROVISION OF BRIEF CASE



























07/04/2011 20/2011 – 12

NBG/PBU/LIMA-

NOMINAT/1/2011 –

12

THE BANKING COMPANIES (NOMINATION)

RULES, 1985 CLARIFICATIONS

07/04/2011 19/2011 – 12

IBG/FD/FD-

NRA/FCNB/4/2011 –

12

FCNR (B) PREMIUM ACCOUNT

07/04/2011 18/2011 – 12 IBG/FD/FD-

CRBE/3/2011 – 12

BANK EXPOSURES 1. UNICREDIT SPA, ITALY, 2.

STANDARD BANK OF SOUTH AFRICA, 3. ABSA

BANK, SOUTH AFRICA

07/04/2011 17/2011 – 12

NBG/PBU/PL-

EDUCATION/2/2011 –

12

PERSONAL BANKING ADVANCES INTEREST

SUBSIDY SCHEME ON EDUCATION LOAN FOR

ECONOMICALLY WEAKER SECTION PROPOSED

BY MINISTRY OF HRD, GOVT. OF INDIA

06/04/2011 16/2011 – 12 CDO/P&HRD-

IR/4/2011 – 12

WORKMEN STAFF HOSPITALISATION SCHEME

MEDICAL AID AND EXPENSES COST OF INTRA-

OCULAR LENS (IOL)

06/04/2011 15/2011 – 12 CDO/P&HRD-

PM/3/2011 – 12

STAFF : SUPERVISING REVISION IN RENTAL

CEILINGS FOR LEASED ACCOMMODATION/

CAR PARKING CHARGES/ MAINTENANCE

CHARGES

06/04/2011 14/2011 – 12

NBG/PBU/PL-

PERLOANS/1/2011 –

12

DOCUMENTS FOR LOANS AGAINST BALANCES

IN DEPOSIT A/CS

06/04/2011 13/2011 – 12 CDO/P&HRD-

PM/2/2011 – 12

STAFF : SUPERVISING: SUBMISSION OF ASSETS

AND LIABILITIES STATEMENTS AS ON 31ST

MARCH, 2011 THROUGH HRMS

06/04/2011 12/2011 – 12

NBG/PBU/AL-

CARLOANS/1/2011 –

12

PERSONAL BANKING : AUTO LOANS AUTO

LOAN COUNSELORS : MODIFICATIONS IN

DOCUMENTS

06/04/2011 11/2011 – 12 NBG/PBU/HL-HOME PBBU : HOME LOANS FESTIVAL SEASON OFFER

: TRIPLE H PLUS DATA ENTRY TO BE MADE IN





























Index of ‘eCirculars’ issued in FY 2010-11

31/03/2011 1084/2010 – 11 CDO/P&HRD-IR/94/2010 – 11

CONVERSION OF SPECIALIST CATEGORY OF STAFF TO GENERAL CATEGORY

31/03/2011 1083/2010 – 11 NBG/BOD- ISSUING ACKNOWLEDGEMENT FOR FORM 15G /

LOANS/3/2011 – 12 THE BANCASSURANCE ONLINE SITE

05/04/2011 10/2011 – 12 CS&NB/CS&NB-

TECH/1/2011 – 12

MOBILE BANKING SERVICE OVER SMS

PLATFORM ACCEPTANCE OF TERMS AND

CONDITIONS OF SERVICE

05/04/2011 9/2011 – 12 RABG/RB-AC-

AC/1/2011 – 12

ENGAGEMENT OF BUSINESS

CORRESPONDENTS ( BCS) DISPLAYING OF ‘DO’S

& DON’TS AT THE CSP OUTLET-KIOSK BANKING

OPERATIONS

05/04/2011 7/2011 – 12 NBG/PBU/HL-HOME

LOANS/2/2011 – 12

HOME LOANS : PRODUCT CODES W.E.F. 1ST

APRIL, 2011

05/04/2011 6/2011 – 12 NBG/CCD-

CMS/1/2011 – 12

LEAD MANAGEMENT SYSTEM (LMS)

CENTRALIZED SOLUTION FOR LEADS

05/04/2011 5/2011 – 12 IBG/FD/FD-

CRBE/2/2011 – 12

COUNTRY RISK MANAGEMENT –COUNTRY

EXPOSURE – MAURITIUS

04/04/2011 4/2011 – 12 IBG/FD/FD-

MISC/1/2011 – 12

SERVICE TAX ON FOREIGN

EXCHANGETRANSACTIONS

02/04/2011 3/2011 – 12 CCO/CPPD-

INT/1/2011 – 12

DISCOUNTING OF INLAND BILLS UNDER LCS –

INTEREST RATE STRUCTURE

01/04/2011 2/2011 – 12 CDO/P&HRD-

CM/1/2011 – 12

STAFF OFFICER: SPECIALIST (NON BANKING)

CADRE : PROMOTION YEAR 2011-12 :

PROMOTIONS UPTO SMGS – V : OPTION TO

OPT OUT

01/04/2011 1/2011 – 12 NBG/PBU/HL-HOME

LOANS/1/2011 – 12

ANNUAL CLOSING 2010-11 SCHEME OF

SUBVENTION ON HOUSING LOANS UP TO RS

10 LAKHS SUBSIDY AMOUNT DIRECT CREDIT

TO ELIGIBLE HOME LOAN ACCOUNTS

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1084.pdf

1083.pdf



























GB/106/2010 – 11 15H

31/03/2011 1081/2010 – 11 NBG/AGNYBKG-RBI/3/2010 – 11

COMPLIANCE OF RBI INSTRUCTIONS REGARDING DETECTION & IMPOUNDING OF COUNTERFEIT NOTES

31/03/2011 1080/2010 – 11 NBG/AGNYBKG-RBI/2/2010 – 11

INSTALLATION OF NOTE SORTING MACHINES – NOTE AUTHENTICATION AND FITNESS SORTING PARAMETERS

30/03/2011 1079/2010 – 11 NBG/PBU/AL-CARLOANS/33/2010 – 11

PERSONAL BANKING: CAR LOAN – AUTHORISATION OF BRANCHES FOR CAR LOANS

29/03/2011 1078/2010 – 11 NBG/PBU/LIMA-TD/46/2010 – 11

PROCEDURE FOR PREMATURE CLOSING OF TDR/STDR AND OPENING A NEW TDR/STDR

29/03/2011 1077/2010 – 11 NBG/SMEBU-CONSTEQUIP/106/2010 – 11

EXTENSION OF THE SCHEME FOR FINANCING JCB MACHINES

29/03/2011 1076/2010 – 11 NBG/GAD-UMEA/21/2010 – 11

GOVERNMENT BUSINESS : E-PAYMENT SYSTEM FOR PAYMENT OF MCA-21 FEE AND STAMP DUTY THROUGH ELECTRONIC MODE MANDATORY FROM 27.03.2011

29/03/2011 1075/2010 – 11 RABG/RB-AC-AC/19/2010 – 11

RURAL BUSINESS ENGAGEMENT OF BUSINESS CORRESPONDENTS (BCS): INCORPORATION OF CLAUSE FOR RENEWAL OF BC AGREEMENT

29/03/2011 1074/2010 – 11 NBG/PBU/PL-EDUCATION/35/2010 – 11

PERSONAL BANKING ADVANCES EDUCATION LOANS INTEREST SUBSIDY SCHEME FOR ECONOMICALLY WEAKER SECTION (EWS)-AUDITOR’S CERTIFICATE

29/03/2011 1073/2010 – 11 CCO/CPPD-WF/126/2010 – 11

IDENTIFICATION OF WILFUL DEFAULTERS GRIEVANCE REDRESSAL MECHANISM

28/03/2011 1072/2010 – 11 NBG/PBU/HL-HOUSING/54/2010 – 11

ANNUAL CLOSING 2010-11 – SCHEME OF SUBVENTION ON HOUSING LOANS UPTO RS 10 LAKHS

26/03/2011 1071/2010 – 11 IBG/FD/FD-MISC/114/2010 – 11

NOSTRO ACCOUNT RECONCILIATION GUIDELINES

25/03/2011 1070/2010 – 11 CDO/P&HRD-IR/93/2010 – 11

STAFF WELFARE ACTIVITIES : GROUP INSURANCE SCHEME FOR EMPLOYEES : SAMPOORN SURAKSHA TERM PLAN : MASTER POLICY NO.82001572405

25/03/2011 1069/2010 – 11 NBG/PBU/PL-SCHOLAR/34/2010 – 11

PERSONAL BANKING ADVANCES – SBI SCHOLAR LOAN SCHEME – REVIEW, MODIFICATIONS AND INCLUSION OF NEW INSTITUTES

1081.pdf

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1081.pdf

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1078.pdf

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1077.pdf

1077.pdf

1076.pdf

1076.pdf

1076.pdf

1076.pdf

1075.pdf

1075.pdf

1075.pdf

1074.pdf

1074.pdf

1074.pdf

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1072.pdf

1072.pdf

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1070.pdf

1070.pdf

1070.pdf

1070.pdf

1069.pdf

1069.pdf

1069.pdf


25/03/2011 1068/2010 – 11 CCO/CPPD-GB/125/2010 – 11

GREEN BANKING: DETERMINATION OF BANK LEVEL CARBON FOOTPRINT

24/03/2011 1067/2010 – 11 IBG/FD/FD-CRBE/113/2010 – 11

COUNTRY RISK MANAGEMENT- COUNTRY EXPOSURE – MAURITIUS

24/03/2011 1065/2010 – 11 IBG/FD/FD-MISC/111/2010 – 11

INTRODUCTION OF ANNUAL RETURN ON FOREIGN LIABILITIES AND ASSETS REPORTING BY INDIAN COMPANIES AND DISCONTINUATION OF THE PART B OF FORM FC-GPR

24/03/2011 1064/2010 – 11 NBG/ABU/PDM-AGRI GEN/31/2010 – 11

GOVERNMENT OF INDIA SCHEMES:: SUBMISSION OF UTILIZATION CERTIFICATES

22/03/2011 1062/2010 – 11 NBG/GAD-UMEA/20/2010 – 11

GOVERNMENT BUSINESS : E-PAYMENT SYSTEM FOR PAYMENT OF MCA-21 FEE AND STAMP DUTY THROUGH ELECTRONIC MODE MANDATORY FROM 27.03.2011

22/03/2011 1061/2010 – 11 CCO/CPPD-CDR/124/2010 – 11

CORPORATE DEBT RESTRUCURING(CDR) CELL – RECOVERY OF HANDLING CHARGES FOR RESTRUCTURING PROPOSALS

18/03/2011 1059/2010 – 11 RABG/RB-AC-AC/18/2010 – 11

RURAL BUSINESS: ENGAGEMENT OF BUSINESS CORRESPONDENTS (BCS)/CUSTOMER SERVICE POINTS ( CSPS) REPUTATION RISK- MITIGATION

18/03/2011 1058/2010 – 11 NBG/PBU/HL-HOME LOANS/53/2010 – 11

PERSONAL BANKING: HOME LOANS SBI LIFE GROUP INSURANCE POLICY DHANARAKSHA PLUS SINGLE PREMIUM-WITHDRAWAL NOTIFICATION MASTER POLICY NO. 92000001105 AND 92000001007

18/03/2011 1057/2010 – 11 CDO/P&HRD-CM/92/2010 – 11

SCHEME FOR GRANT OF SILVER JUBILEE AWARD TO THE EMPLOYEES INCREASE IN QUANTUM

18/03/2011 1056/2010 – 11 CDO/P&HRD-CM/91/2010 – 11

SCHEMES FOR PRESENTATION OF MEMENTO ON RETIREMENT INCREASE IN QUANTUM


PERSONAL BANKING ADVANCES: EDUCATION LOAN SCHEME – COMPETENT AUTHORITY FOR WAIVER OF THIRD PARTY GUARANTEE

18/03/2011 1054/2010 – 11 CCO/CPPD-ADV/123/2010 – 11

ACCEPTANCE OF INVESTMENTS IN SELECT SBI MUTUAL FUNDS AS COLLATERAL SECURITY AND IN LIEU OF CASH MARGIN FOR THE BANK’S FUND/ NON-FUND EXPOSURES

18/03/2011 1053/2010 – 11 CCO/CPPD-ADV/122/2010 – 11

REPORTING OF IRREGULARITIES – REVISION IN AUTHORITY STRUCTURE

17/03/2011 1051/2010 – 11 CDO/P&HRD-IR/90/2010 – 11

STAFF:: SUB-ORDINATE : PROMOTION TO THE POST OF STEWARD IN CLERICAL CADRE : AT

1068.pdf

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1065.pdf

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1054.pdf

1053.pdf

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1051.pdf


STATE BANK BHAVAN

17/03/2011 1050/2010 – 11 CDO/P&HRD-CM/89/2010 – 11

STAFF : SUPERVISING : REPATRIATION OF OFFICERS : POSTED IN CORPORATE CENTRE AND ITS ESTABLISHMENTS : CHANGE IN TENURE

17/03/2011 1049/2010 – 11 CDO/P&HRD-PM/88/2010 – 11

OFFICERS ENGAGED ON CONTRACT: MANAGEMENT TRAINEES (MTS), CREDIT ANALYSTS (WB/MCG), CUSTOMER RELATIONSHIP EXE (WB/MCG) AND CHARTERED ACCTS (CAS)- REVISION IN TERMS & CONDITIONS- CLARIFICATIONS

16/03/2011 1048/2010 – 11 CCO/CPPD-TUFS/121/2010 – 11

CREDIT LINKED CAPITAL SUBSIDY SCHEME (CLCSS) FOR TECHNOLOGY UPGRADATION OF SSI BEING IMPLEMENTED BY MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES : SUBMISSION OF CLAIMS FOR THE YEAR 2010-11

15/03/2011 1045/2010 – 11 NBG/GAD-GC/19/2010 – 11

GOVERNMENT BUSINESS : SCHEME FOR COLLECTION OF DUES OF (I) CBDT (II) CBEC (III) UMEA – REPORTING & ACCOUNTING OF MARCH TRANSACTIONS FY 2010-2011.

15/03/2011 1044/2010 – 11 NBG/S&P-BRANCH CLEAR/23/2010 – 11

INTRODUCTION OF INTER BRANCH TRANSFER SYSTEM (IBTS)

15/03/2011 1043/2010 – 11 IBG/FD/FD-CRBE/109/2010 – 11

COUNTRY RISK MANAGEMENT – CRISIS IN MIDDLE EAST & NORTH AFRICA – PRUDENTIAL MEASURES RELATING TO COUNTRY EXPOSURE

14/03/2011 1042/2010 – 11 IBG/FD/FD-CRBE/108/2010 – 11

CAUTIONARY INSTRUCTION ON BANK EXPOSURES- 1- UNICREDIT SPA, ITALY 2- STANDARD BANK OF SOUTH AFRICA 3- ABSA BANK, SOUTH AFRICA

14/03/2011 1040/2010 – 11 CDO/P&HRD-IR/87/2010 – 11

INCENTIVE SCHEME FOR MERITORIOUS CHILDREN OF STAFF PURSUING PROFESSIONAL COURSES AT ELITE INSTITUTES IN INDIA SUBMISSION OF SEPARATE AFFIDAVIT

12/03/2011 1039/2010 – 11 NBG/PBU/PL-PERLOANS/32/2010 – 11

PERSONAL BANKING ADVANCES – LOAN FOR SUBSCRIPTION TO IPOS

12/03/2011 1038/2010 – 11 CDO/P&HRD-CM/86/2010 – 11

STAFF: MISCELLANEOUS : BRINGING POLITICAL OR OUTSIDE INFLUENCE

12/03/2011 1036/2010 – 11 RABG/RB-AC-AC/17/2010 – 11

RURAL BUSINESS – RURAL MARKETING AND RECOVERY OFFICERS (RMROS) – ALLOTMENT OF LOANS AND RECOVERY TARGETS

1050.pdf

1050.pdf

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1040.pdf

1040.pdf

1040.pdf

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1039.pdf

1038.pdf

1038.pdf

1036.pdf

1036.pdf

1036.pdf


11/03/2011 1034/2010 – 11 CFO/A&C-TDS/6/2010 – 11

TDS FROM BANKS INCOME – SBI GICL

11/03/2011 1033/2010 – 11 RABG/RB-AC-AC/16/2010 – 11

BUSINESS CORRESPONDENTS (BCS) – ENGAGEMENT OF SUB-AGENTS/CSPS

11/03/2011 1032/2010 – 11 CS&NB/CS&NB-E/15/2010 – 11

DEMAT SERVICES AND ONLINE TRADING (EZ-TRADE @ SBI) BUSINESS – INTRODUCTION OF REVISED BUSINESS MODEL


PERSONAL BANKING: HOME LOANS OBTAINING SEARCH REPORT IN CASE OF PROPORTIES ALLOTED BY THE DEVELOPMENT AUTHORITY/GOVERNMENT BODIES

09/03/2011 1029/2010 – 11 IBG/FD/FD-FCTC/CC/107/2010 – 11

FOREIGN CURRENCY TRAVELLERS CHEQUES (FCTC) AMERICAN EXPRESS BANK (AEB) TRAVELLERS CHEQUES IMPLEMENTATION OF AUTHENTICATION AND AUTHORIZATION CODE

09/03/2011 1028/2010 – 11 IBG/FD/FD-MISC/106/2010 – 11

DERIVATIVE SETTLEMENT PROCESS – PROCEDURE FOR BRANCHES

09/03/2011 1027/2010 – 11 RABG/RB-AC-AC/15/2010 – 11

ENGAGEMENT OF BUSINESS CORRESPONDENTS(BCS) : AMENDMENTS IN THE AGREEMENT

09/03/2011 1026/2010 – 11 CCO/CPPD-ADV/119/2010 – 11

GUIDELINES ON BASE RATE

08/03/2011 1024/2010 – 11 NBG/ABU/PDM-DEBTSWAP/29/2010 – 11

SCHEME FOR DEBT SWAPPING OF BORROWERS-MODIFICATIONS

08/03/2011 1023/2010 – 11 CDO/P&HRD-PM/84/2010 – 11

STAFF: SUPERVISING (FEMALE OFFICERS) I.MATERNITY LEAVE- EXTRAORDINARY LEAVE ON LOSS OF PAY II.MARRIED LADY OFFICERS MEDICAL AID- DEPENDENT PARENTS

08/03/2011 1022/2010 – 11 CDO/P&HRD-PM/83/2010 – 11

SBI- RETIRED EMPLOYEES MEDICAL BENEFIT SCHEME (REMBS) DOMICILIARY TREATMENT- CLARIFICATION


SCHEME OF 1% INTEREST SUBVENTION ON HOUSING LOANS UPTO RS. 10 LAKH MODALITIES FOR SUBMISSION OF THE CLAIM TO RBI

05/03/2011 1018/2010 – 11 CS&NB/CS&NB-DEBITCRD/14/2010 – 11

STATE BANK DEBIT CARD: NEW VARIANTS – STATE BANK CLASSIC DEBIT CARD & STATE BANK SILVER INTERNATIONAL DEBIT CARD

05/03/2011 1016/2010 – 11 RABG/RB-AC-AC/14/2010 – 11

RURAL BUSINESS: ENGAGEMENT OF BUSINESS CORRESPONDENTS/ BUSINESS FACILITATORS –

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1016.pdf


BANK GUARANTEE IN LIEU OF SECURITY DEPOSIT- FORMAT

05/03/2011 1015/2010 – 11 NBG/PBU/PL-PERLOANS/31/2010 – 11

PERSONAL BANKING ADVANCES – LOAN AGAINST THE UNITS OF GOLD EXCHANGE TRADED SCHEME (SBI – GETS)


SCHEME OF 1% INTEREST SUBVENTION ON HOUSING LOANS UPTO RS. 10 LAKH COLLECTION OF USER ID & PASSWORD DATA FOR CREATION OF USERS (MAKER / CHECKER)

04/03/2011 1013/2010 – 11 NBG/PB/C&ITU-DSP/48/2010 – 11

DSP –AIR FORCE- INCLUSION OF NON-COMBATANTS (ENROLLED)- NC(E)S IN SILVER VARIANT

04/03/2011 1012/2010 – 11 NBG/PB/C&ITU-DSP/47/2010 – 11

JOB PROFILE OF DEFENCE BANKING ADVISORS AND CIRCLE DEFENCE BANKING ADVISORS

04/03/2011 1011/2010 – 11 NBG/PB/C&ITU-CSP/46/2010 – 11

BULK CONVERSION OF SALARY PACKAGE ACCOUNTS

04/03/2011 1009/2010 – 11 NBG/SMEBU-WAREHOUSE/98/2010 – 11

FINANCE AGAINST WARE HOUSE RECEIPTS – CONCESSION IN INTEREST RATE

01/03/2011 1004/2010 – 11 NBG/BOD-GB/102/2010 – 11

RATIONALISATION OF SERVICE CHARGES FOR CHEQUES COLLECTION – OUTSTATIONS AND UNDER SPEED CLEARING SYSTEM W.E.F 01.04.2011

01/03/2011 1003/2010 – 11 NBG/BOD-AC/101/2010 – 11

ATM: ANNUAL MAINTENANCE FEE FOR ALL ATM-CUM-DEBIT CARDS ISSUED BY THE STATE BANK OF INDIA

01/03/2011 1002/2010 – 11 NBG/PB/C&ITU-CSP/45/2010 – 11

MISSION CYBER POWER III- EXTENSION OF CAMPAIGN FOR 4 MONTHS FROM 01.03.2011 TO 30.06.2011

01/03/2011 1001/2010 – 11 NBG/PB/C&ITU-CSP/44/2010 – 11

RAILWAY SALARY PACKAGE ISSUE OF ADVISORY BY RAILWAY BOARD

01/03/2011 999/2010 – 11 CDO/P&HRD-PM/81/2010 – 11

PAYMENT OF “SPECIAL BALANCING ALLOWANCE” TO ALL OFFICERS/EMPLOYEES WHO WERE IN THE PERMANENT SCALE OF THE BANK AS ON 31.10.2007

28/02/2011 998/2010 – 11 CCO/CPPD-ADV/118/2010 – 11

COLLECTION AND DISSEMINATION OF INFORMATION ON CASES OF WILFUL DEFAULT (NON-SUIT FILED ACCOUNTS) OF RS.25 LACS AND ABOVE QUARTER ENDED SEPTEMBER 2010

28/02/2011 997/2010 – 11 CCO/CPPD- DISCLOSURE OF INFORMATION REGARDING

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ADV/117/2010 – 11 DEFAULTING BORROWERS OF BANK AND FINANCIAL INSTITUTIONS OF RS. 1 CRORE AND ABOVE HALF-YEAR ENDED SEPTEMBER 30, 2010.

26/02/2011 996/2010 – 11 CDO/P&HRD-CM/80/2010 – 11

STAFF: SUPERVISING RECRUITMENT OF MANAGEMENT EXECUTIVES IN MMGS II POLICY FOR CONFIRMATION

25/02/2011 994/2010 – 11 NBG/GAD-PPF/18/2010 – 11

GOVERNMENT BUSINESS : PUBLIC PROVIDENT FUND SCHEME 1968 (PPF), AMENDMENT TO SECTION 9(3)OF THE SCHEME,PUBLIC PROVIDENT FUND (HUF) ACCOUNTS

25/02/2011 993/2010 – 11 CCO/CPPD-INT/116/2010 – 11

EXPORT CREDIT – ALL MARKET SEGMENTS INTEREST RATES ON RUPEE EXPORT CREDIT (LINKED TO BASE RATE)

25/02/2011 992/2010 – 11 CCO/CPPD-ADV/115/2010 – 11

CORPORATE LOAN MODIFICATION

25/02/2011 991/2010 – 11 NBG/PBU/LIMA-REMITTA/45/2010 – 11

WESTERN UNION BUSINESS – JOB CARD

24/02/2011 990/2010 – 11 IBG/FD/FD-MISC/105/2010 – 11

MISC REMITTANCES FROM INDIA – FACILITIES FOR RESIDENTS – RETENTION PERIOD OF FORM A2

24/02/2011 989/2010 – 11 IBG/FD/FD-MISC/104/2010 – 11

DEFERRED PAYMENT PROTOCOLS DATED APRIL 30 ,1981 AND DECEMBER 23, 1985 BETWEEN GOVERNMENT OF INDIA AND ERSTWHILE USSR

24/02/2011 987/2010 – 11 CDO/P&HRD-PM/79/2010 – 11

TDS ON SALARIES OF EMPLOYEES FINANCIAL YEAR 2010-11

24/02/2011 986/2010 – 11 NBG/CCD-CMS/2/2010 – 11

CONTACT CENTRE – LAUNCH OF MULTIPLE LANGUAGES

23/02/2011 984/2010 – 11 NBG/PB/C&ITU-CSP/42/2010 – 11

SEPARATE CUSTOMER TYPE FOR CSP ACCOUNTS OF CAG AND MCG UNITS

22/02/2011 982/2010 – 11 CCO/CPPD-INT/114/2010 – 11

INTEREST RATE STRUCTURE IN BASE RATE SEGMENT C AND I, SIB AND AGRI

22/02/2011 981/2010 – 11 RABG/RBNFMCFI-MCFI/2/2010 – 11

MICRO FINANCE- SELF HELP GROUP FINANCING – INTEREST RATE STRUCTURE MIGRATION TO BASE RATE W.E.F. 01.07.2010

22/02/2011 980/2010 – 11 NBG/S&P-SP/22/2010 – 11

JUNIOR MANAGEMENT GRADE SCALE I OFFICER (JMGS-I OFFICERS),PROBATIONARY OFFICERS AND TRAINEE OFFICERS-ENHANCEMENT IN PASSING POWERS

22/02/2011 979/2010 – 11 CFO/A&C- TDS – IT TDS FROM BANKS INCOME

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TDS/5/2010 – 11


ACKNOWLEDGEMENT OF LOAN APPLICATION FORM

18/02/2011 976/2010 – 11 CDO/P&HRD-PHRD/78/2010 – 11

PROJECT: HRMS ROLL-OUT OF NEW SERVICES

18/02/2011 975/2010 – 11 CDO/P&HRD-IR/77/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN) BY SBI BENEFITS/FACILITIES TO PRE-MERGER RETIREES

18/02/2011 974/2010 – 11 CDO/P&HRD-PM/76/2010 – 11

OFFICERS ENGAGED ON CONTRACT: MANAGEMENT TRAINEES (MTS), CREDIT ANALYSTS (WB/MCG), CUSTOMER RELATIONSHIP EXECUTIVE (WB/MCG) AND CHARTERED ACCOUNTANTS (CAS)- REVISION IN TERMS & CONDITIONS

18/02/2011 973/2010 – 11 NBG/ABU/BP-SPECIAL I/13/2010 – 11

CHAK DE AGRI: SPECIAL INCENTIVE SCHEME; REWARD TO ELIGIBLE RCPC OFFICIALS AND CBS CODES FOR CORRECT REPORTING OF DIRECT/INDIRECT AGRI

18/02/2011 972/2010 – 11 IBG/FD/FD-MISC/103/2010 – 11

CORRESPONDENT RELATIONS NOSTRO ACCOUNT IN AED WITH STATE BANK OF INDIA WHOLESALE BANKING BRANCH BAHRAIN REQUESTS NOT TO ROUTE IRANIAN TRANSACTION

18/02/2011 969/2010 – 11 NBG/BOD-AC/100/2010 – 11

ATM PROJECT – VERIFICATION OF ATM CASH – CIRCLE AUDIT

18/02/2011 968/2010 – 11 NBG/BOD-AC/99/2010 – 11

ATM – ANNUAL MAINTENANCE FEE FOR ALL DEBIT CARDS ISSUED BY THE STATE BANK OF INDIA

17/02/2011 965/2010 – 11 CDO/P&HRD-PM/74/2010 – 11

OPERATIONAL RISK MANAGEMENT CENTRALISED ACCESS CONTROL POLICY DEPROVISIONING OF USER- IDS OF EMPLOYEES

17/02/2011 964/2010 – 11 IBG/FD/FD-MISC/100/2010 – 11

USE OF INTERNATIONAL DEBIT CARDS/ STORE VALUE CARDS/CHARGE CARDS/SMART CARDS BY RESIDENT INDIANS WHILE ON A VISIT OUTSIDE INDIA

17/02/2011 963/2010 – 11 IBG/FD/FD-MISC/99/2010 – 11

EU – REGULATIONS SETTLEMENT OF IRAN RELATED TRANSACTIONS SUSPENSION OF TRANSACTIONS BY SBI FRANKFURT

17/02/2011 962/2010 – 11 IT/GLOBALIT-INB/19/2010 – 11

INTERNET BANKING – INTRODUCTION OF SIMPLIFIED INB ROLE HOLDING FOR SMALL BRANCHES

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962.pdf



MASTER CIRCULAR – SBI EDUCATION LOAN SCHEME (SBI STUDENT LOAN SCHEME)

15/02/2011 956/2010 – 11 CFO/SHAREBON-BONDS/2/2010 – 11

STATE BANK OF INDIA – PUBLIC ISSUE OF BONDS -2011


INTEREST SUBSIDY SCHEME FOR HOUSING THE URBAN POOR (ISHUP) CHANGES IN THE OPERATING MODALITIES OF THE ISHUP SCHEME

12/02/2011 951/2010 – 11 CDO/P&HRD-CM/72/2010 – 11

FINANCIAL INCLUSION PLAN 2010-13 : PERFORMANCE EVALUATION

12/02/2011 948/2010 – 11 CDO/P&HRD-CM/71/2010 – 11

PERFORMANCE MANAGEMENT SYSTEM : SUBMISSION OF SELF APPRAISAL

12/02/2011 947/2010 – 11 NBG/GAD-UMEA/17/2010 – 11

GOVERNMENT BANKING : MINISTRY OF HUMAN RESOURCE DEVELOPMENT (MOHRD) “SAAKSHAR BHARAT” (NATIONAL LITERACY MISSION) NEW PRODUCT – “BHARAT NIRMAN” – NLM

12/02/2011 946/2010 – 11 CCO/CPPD-PRUDENTIAL/109/2010 – 11

PRUDENTIAL GUIDELINES ON RESTRUCTURING OF ADVANCES BY BANKS – CREDIT SUPPORT TO MICRO-FINANCE INSTITUTIONS(MFIS)

12/02/2011 945/2010 – 11 CCO/CPPD-ADV/108/2010 – 11

LENDING TO AGRICULTURE SECTOR – CLASSIFICATION OF LOANS AGAINST GOLD JEWELLERY

12/02/2011 944/2010 – 11 CCO/CPPD-ADV/107/2010 – 11

SMA ACCOUNTS IN MULTIPLE BANKING ARRANGEMENT (MBA)

11/02/2011 941/2010 – 11 RABG/RB-IT-IT/8/2010 – 11

SBI TINY PROJECT:BULK ACCOUNT CREATION IN CBS – STEPS FOR UPLOADING THE FILES

10/02/2011 939/2010 – 11 CDO/P&HRD-CM/70/2010 – 11

ESSAY COMPETITION – 2011

09/02/2011 935/2010 – 11 CCO/CPPD-ADV/106/2010 – 11

END USE OF FUNDS – MONITORING

09/02/2011 934/2010 – 11 NBG/SMEBU-PRISECTOR/92/2010 – 11

ANNUAL FINANCIAL INSPECTION--- PRIORITY SECTOR LOANS –MIS CLASSIFICATION BY BANKS

09/02/2011 933/2010 – 11 CS&NB/CS&NB-TECH/13/2010 – 11

MOBILE BANKING SERVICE (MBS) – ROLL OUT ON SMS PLATFORM


SCHEME FOR FINANCING EARNEST MONEY DEPOSIT (EMD) CONCESSION IN PROCESSING FEE

08/02/2011 930/2010 – 11 IT/GLOBALIT-ATM/18/2010 – 11

REGISTRATION OF CHARGEBACK COMPLAINTS OF OTHER BANKS’ CUSTOMERS IN COMPLAINT MANAGEMENT SYSTEM (CMS)

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PERSONAL BANKING ADVANCES – INTEREST SUBSIDY SCHEME ON EDUCATION LOAN FOR ECONOMICALLY WEAKER SECTION PROPOSED BY MINISTRY OF HRD, GOVT. OF INDIA

07/02/2011 928/2010 – 11 NBG/ABU/BP-SPECIAL I/12/2010 – 11

CHAK DE AGRI : SPECIAL INCENTIVE SCHEME

07/02/2011 927/2010 – 11 NBG/BOD-FMC/97/2010 – 11

PAYMENT OF FAKE MULTICITY CHEQUES BY BRANCHES – SECURITY FEATURES

07/02/2011 925/2010 – 11 CDO/P&HRD-IR/68/2010 – 11

INCENTIVE SCHEME FOR MERITORIOUS CHILDREN OF STAFF PURSUING PROFESSIONAL COURSES AT ELITE INSTITUTES IN INDIA

07/02/2011 924/2010 – 11 CCO/CPPD-ADV/105/2010 – 11

ACCEPTANCE OF INVESTMENTS IN SELECT SBI MUTUAL FUNDS AS COLLATERAL SECURITY AND IN LIEU OF CASH MARGIN FOR THE BANK’S FUND/ NON-FUND EXPOSURES

07/02/2011 923/2010 – 11 CCO/CPPD-ADV/104/2010 – 11

INTERCHANGEABILITY IN LIMITS – FUND BASED AND INVESTMENT IN SHORT TERM CPS & NCD

05/02/2011 922/2010 – 11 NBG/ABU/PDM-CS/25/2010 – 11

SPECIAL BUSINESS DEVELOPMENT DRIVE-DISCOUNTED RATE OF INTEREST FOR COLD STORAGE/WARE HOUSES TO BE SET UP FOR STORAGE OF AGRICULTURAL PRODUCE INCLUDING VEGETABLES AND FRUITS

05/02/2011

919/2010 – 11

NBG/SMEBU-CGTSI/90/2010 – 11

CREDIT GUARANTEE FUND TRUST FOR MICRO AND SMALL ENTERPRISES (CGTMSE) : COMMON REASON FOR CLAIM REJECTION.

04/02/2011 917/2010 – 11 IBG/FD/FD-MISC/98/2010 – 11

NON-CORRESPONDENT RELATIONSHIP ESTABLISHMENT OF RMA ARRANGEMENT

04/02/2011 916/2010 – 11 IBG/FD/FD-MISC/97/2010 – 11

EU – REGULATIONS / USOFAC SANCTIONS : SUDAN & MYANMAR IN-HOUSE INTERNAL POLICY OF SBI FRANKFURT

03/02/2011 913/2010 – 11 NBG/BOD-KYC/94/2010 – 11

KYC/AML STANDARDS AMENDMENT TO PREVENTION OF MONEY LAUNDERING RULES, 2005 – SMALL ACCOUNT

03/02/2011 912/2010 – 11 NBG/S&P-SP/21/2010 – 11

OBSOLETE SECURITY FORMS: DRAFTS, BANKERS CHEQUE ETC

02/02/2011 911/2010 – 11 NBG/PBU/LIMA-Persona/44/2010 – 11

BPR PROJECT – NON PERSONALISED WELCOME KITS WITH ATM CARDS ONLY

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02/02/2011 909/2010 – 11 NBG/ABU/PDM-CS/23/2010 – 11

CISS FOR CONSTRUCTION/EXPANSION/MODERNISATION OF COLD STORAGES AND HORTICULTURAL PRODUCE-REVISED GUIDELINES AND IMPLEMENTATION PROCEDURE

02/02/2011 908/2010 – 11 NBG/BOD-FMC/93/2010 – 11

SCHEME FOR RECOGNITION AND REWARDS OF ALERTNESS IN STAFF MEMBERS IN PREVENTION/DETECTION/FOILING OF FRAUDS “THE ALERTNESS AWARD”

02/02/2011 907/2010 – 11 CDO/P&HRD-PM/67/2010 – 11

DEFINED CONTRIBUTION PENSION SCHEME / NEW PENSION SCHEME FOR ALL NEWLY RECRUITED EMPLOYEES (OFFICERS/EMPLOYEES) W.E.F.1.8.2010 APPOINTMENT OF SERVING EMPLOYEES AS PROBATIONARY OFFICERS / APPOINTMENT

01/02/2011 906/2010 – 11 NBG/GAD-PPF/16/2010 – 11

GOVERNMENT BUSINESS : PUBLIC PROVIDENT FUND ACCOUNTS (HUF), APPEAL AGAINST THE ORDERS OF BANKING OMBUDSMAN, AHMEDABAD

01/02/2011 905/2010 – 11 CCO/CPPD-ADV/103/2010 – 11

FORWARD CONTRACTS AND DERIVATIVES – OPERATIONAL GUIDELINES

31/01/2011 904/2010 – 11 NBG/BOD-FMC/92/2010 – 11

OPERATIONAL RISK IN BANK FRAUD: AMOUNT RS. 67.96 LAC RBOKERAGES – GOVERNMENT OF INDIA BONDS


PERSONAL BANKING: HOME LOANS INTEREST RATE ON VANILLA HOME LOAN PRODUCTS, REVERSE MORTGAGE LOAN, HOME PLUS ETC (OTHER THAN SBI EASY, ADVANTAGE AND PREMIUM HOME LOAN)


MASTER CIRCULAR : SBI CAR LOAN SCHEME

29/01/2011 899/2010 – 11 NBG/CCD-CMS/1/2010 – 11

CUSTOMER COMPLAINTS HANDLING THROUGH COMPLAINT MANAGEMENT SYSTEM (CMS)

28/01/2011 898/2010 – 11 NBG/BOD-GB/91/2010 – 11

EXTENSION OF COVERAGE OF SPEED CLEARING SYSTEM TO NON-MICR CLEARING CENTRE

28/01/2011 897/2010 – 11 IBG/FD/FD-MISC/96/2010 – 11

SERVICE TAX ON FOREX BUSINESS – LEVY OF SERVICE CHARGES ON PURCHASE AND SALE TRANSACTIONS

28/01/2011 896/2010 – 11 IBG/FD/FD-MISC/95/2010 – 11

USOFAC – CAUTIONARY INSTRUCTIONS

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28/01/2011 895/2010 – 11 IT/GLOBALIT-INB/17/2010 – 11

INTERNET BANKING : E-RD – ONLINE OPENING OF RECURRING DEPOSIT ACCOUNT

27/01/2011 894/2010 – 11 IBG/FD/FD-MISC/94/2010 – 11

EU – REGULATIONS – ACU – MECHANISM SETTLEMENT OF IRAN RELATED TRANSACTIONS SUSPENSION OF TRANSACTIONS BY SBI FRANKFURT

27/01/2011 893/2010 – 11 NBG/BOD-GB/90/2010 – 11

DEPOSITING THE PROCEEDS OF CHEQUES IN SUSPENSE ACCOUNT IN LIEU OF CUSTOMERS’ ACCOUNTS WITHOUT INFORMING CUSTOMERS FOR VARIOUS REASONS –RIA 2459 REFERENCE FROM RBI

27/01/2011 891/2010 – 11 NBG/BOD-KYC/88/2010 – 11

ANTI-MONEY LAUNDERING (AML) / COMBATING OF FINANCING OF TERRORISM (CFT) – STANDARDS

27/01/2011 890/2010 – 11 NBG/BOD-KYC/87/2010 – 11

ANTI-MONEY LAUNDERING (AML) / COMBATING OF FINANCING OF TERRORISM (CFT) – STANDARDS

27/01/2011 887/2010 – 11 NBG/PBU/AL-AUTOLOAN/25/2010 – 11

PERSONAL BANKING: CAR LOANS AUTHORIZATION OF BRANCHES: ADDITIONAL CENTRES

25/01/2011 886/2010 – 11 IBG/FD/FD-FL/APTA/93/2010 – 11

EXIM BANK’S LINE OF CREDIT OF USD 213.31 MILLION TO THE GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA


MASTER CIRCULAR – HOME LOANS

22/01/2011 884/2010 – 11 RABG/RB-AC-AC/13/2010 – 11

FINANCIAL INCLUSION PLAN 2011-2013 (FIP) TERMS OF ENGAGEMENT OF BUSINESS CORRESPONDENTS (BCS) INDIVIDUALS SECURITY DEPOSIT AND MINIMUM EDUCATION QUALIFICATION

21/01/2011 883/2010 – 11 CDO/P&HRD-CM/66/2010 – 11

STAFF SUPERVISING : SCHEME FOR REIMBURSEMENT OF EXAMINATION FEES : PROFESSIONAL QUALIFICATION CERTIFICATE COURSE IN PROJECT FINANCE JOINT PROGRAMME BY IIBF & IFMR

21/01/2011 881/2010 – 11 IBG/FD/FD-SALES/OR/92/2010 – 11

OUTWARD REMITTANCES – ISSUE OF DRAFTS ON OUR LONDON OFFICE BY BRANCHES IN INDIA USE OF NEW SECURITY FORMS

21/01/2011 880/2010 – 11 IBG/FD/FD-AACBR/91/2010 – 11

CORRESPONDENT RELATIONS – OPENING OF NOSTRO ACCOUNT IN AED WITH STATE BANK OF INDIA, WHOLE SALE BANK BRANCH, BAHRAIN

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20/01/2011 879/2010 – 11 RABG/RB-AC-AC/12/2010 – 11

RURAL BUSINESS: ENGAGEMENT OF BUSINESS CORRESPONDENTS (BCS)- ENTITIES PAYMENT OF REMUNERATIONS TO AGENTS/ EMPLOYEES ( CSPS) – CERTIFICATION BY THE AUDITORS OF ENTITIES

19/01/2011 878/2010 – 11 CCO/CPPD-ADV/102/2010 – 11

SECTORWISE AND INDUSTRY WISE DEPLOYMENT OF GROSS BANK CREDIT (SIBC) FORTNIGHTLY RETURNS: REPORTING DATES ADVISED BY RBI

19/01/2011 876/2010 – 11 NBG/ABU/PDM-AC AND A/22/2010 – 11

AGRI CILINIC AND AGRI BUSINESS CENTRES SCHEME- REVISED GUIDELINES

18/01/2011 875/2010 – 11 NBG/PBU/AL-AUTOLOAN/24/2010 – 11

PERSONAL BANKING : CAR LOAN PRE-APPROVED CAR LOAN SCHEME

18/01/2011 874/2010 – 11 RABG/RB-AC-AC/11/2010 – 11

WAIVER OF INTERCORE CHARGES/ OTHER SERVICE CHARGES FOR THE ACCOUNTS BY THE BUSINESS CORRESPONDENTS (BC)


OPERATIONAL GUIDELINES FOR SUBSIDY LINKED NATIONAL HORTICULTURE BOARD PROJECT

17/01/2011 871/2010 – 11 NBG/PBU/LIMA-ASBA/43/2010 – 11

APPLICATION SUPPORTED BY BLOCKED AMOUNT- PRINTING OF ASBA FORMS

17/01/2011 870/2010 – 11 IT/GLOBALIT-INB/16/2010 – 11

INTERNET BANKING NEW USER RIGHTS FACILITY FOR RETAIL INTERNET BANKING CUSTOMERS : LIMITED TRANSACTION RIGHTS


PERSONAL BANKING: HOME LOANS DISCRETIONARY CONCESSION IN INTEREST RATE

15/01/2011 867/2010 – 11 NBG/BOD-KYC/84/2010 – 11

KYC/AML MEASURES ACCEPTANCE OF PAN CARD AS PROOF OF IDENTITY WHILE OPENING ACCOUNTS


DEPOSIT MOBILISATION CAMPAIGN – P SEGMENT(NBG) FROM 01.01.2011 TO 31.03.2011


PERSONAL BANKING: HOME LOANS OTHER TERMS AND CONDITIONS: MODIFICATIONS

13/01/2011 864/2010 – 11 IBG/FD/FD-NRA/FCNB/90/2010 – 11

NRI DEPOSITS – DEPOSIT MOBILISATION AND CUSTOMER ACQUISITION CAMPAIGN – PERIOD 1ST JANUARY 2011 TO 31ST MARCH 2011

13/01/2011 863/2010 – 11 CCO/CPPD-TUFS/101/2010 – 11

TECHNOLOGY FUND UPGRADATION SCHEME (TUFS)

13/01/2011 855/2010 – 11

NBG/BOD-KYC/82/2010 – 11

KYC/AML/CFT OBLIGATION OF BANKS UNDER PMLA, 2002

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13/01/2011 854/2010 – 11

NBG/PBU/LIMA-REMITTA/41/2010 – 11

WESTERN UNION MONEY TRANSFER (WU) – KNOW YOUR CUSTOMER GUIDELINES

13/01/2011 853/2010 – 11

NBG/BOD-KYC/81/2010 – 11

PML ACT, 2002 AS AMENDED BY PML (AMENDMENT) ACT, 2009 – CROSS BORDER INWARD REMITTANCE UNDER MTSS

13/01/2011 852/2010 – 11

NBG/BOD-KYC/80/2010 – 11

PMLA, 2002 AS AMENDED BY PML (AMENDMENT) ACT, 2009 – MONEY CHANGING ACTIVITIES

13/01/2011 851/2010 – 11

NBG/BOD-KYC/79/2010 – 11

PMLA, 2002 AS AMENDED BY PML (AMENDMENT) ACT, 2009 – MONEY CHANGING ACTIVITIES

13/01/2011 850/2010 – 11

NBG/PBU/PL-EDUCATION/27/2010 – 11

PERSONAL BANKING ADVANCES – EDUCATION LOANS ELIGIBILITY – WITHDRAWAL OF COMPUTER COURSES CONDUCTED BY NIIT

13/01/2011 849/2010 – 11

NBG/BOD-KYC/78/2010 – 11

PMLA, 2002 AS AMENDED BY PML (AMENDMENT) ACT, 2009 – CROSS BORDER INWARD REMITTANCE UNDER MTSS

13/01/2011 848/2010 – 11

NBG/BOD-KYC/77/2010 – 11

PML – SECOND AMENDMENT RULES 2010 – OBLIGATION OF AUTHORISED PERSONS

12/01/2011 847/2010 – 11

CDO/P&HRD-CM/65/2010 – 11

STAFF: SUPERVISING : MANAGEMENT EXECUTIVES (MMGS-II) : PATTERN OF CONFIRMATION TEST

12/01/2011 846/2010 – 11

NBG/PBU/HL-HOME LOANS/42/2010 – 11

PBBU : HOME LOANS SWITCHING FROM SBAR TO BASE RATE AT CUSTOMER’S REQUEST CONSOLIDATED LIST

11/01/2011 845/2010 – 11

NBG/PB/C&ITU-CSP/40/2010 – 11

MODIFICATIONS IN CONCESSIONS HOME LOAN – LOAN TO VALUE RATIO

11/01/2011 844/2010 – 11


NEW PRODUCT- POLICE SALARY PACKAGE

11/01/2011 843/2010 – 11

CDO/P&HRD-PHRD/64/2010 – 11

STAFF SUPERVISING: SECURITY OFFICERS & FIRE OFFICERS DRESS CODE FOR LADY SECURITY OFFICERS/FIRE OFFICERS DRESS CODE AND REIMBURSEMENT OF EXPENSES ON CLOTHING

11/01/2011 842/2010 – 11

NBG/S&P-SP/20/2010 – 11

AUTO RENEWAL OF TDR/STDR UNDER EXCEPTIONS

11/01/2011 835/2010 – 11

NBG/BOD-GB/76/2010 – 11

SERVICE CHARGES PERSONAL BANKING SEGMENT ACCOUNT CLOSURE CHARGES FOR SAVINGS AND CURRENT ACCOUNTS

10/01/2011 834/2010 – 11 IBG/FD/FD- CORRESPONDENT RELATIONS – ZURCHER

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AACBR/83/2010 – 11 KANTONAL BANK (ZKB) , SWITZERLAND DIRECTION OF IMPORT LETTERS OF CREDIT

10/01/2011 833/2010 – 11

IBG/FD/FD-COLLARR/82/2010 – 11

CHANGE IN PROCEDURE – CLEAN COLLECTIONS DENOMINATED IN CANADIAN DOLLARS (CAD) PAYABLE IN CANADA –FROM HSBC, CANADA TO SBI (CANADA) TORONTO

10/01/2011 832/2010 – 11

NBG/BOD-GB/75/2010 – 11

ATM CUM DEBIT CARDS : UNAUTHORISED TRANSACTIONS

10/01/2011 830/2010 – 11

NBG/BOD-KYC/73/2010 – 11

OPENING OF BANK ACCOUNTS AND MONEYMULES

07/01/2011 829/2010 – 11

NBG/PBU/AL-CARLOANS/23/2010 – 11

PERSONAL BANKING: CAR LOAN – NEW PRODUCT: SBI EZEE CAR LOAN (NANO –SUBVENTION) SCHEME

07/01/2011 828/2010 – 11


ENHANCEMENT IN PERSONAL ACCIDENT INSURANCE COVER FOR CSP/DSP/PMSP/RSP/SGSP ETC

07/01/2011 827/2010 – 11

CCO/CPPD-REAL ESTATE/94/2010 – 11

REVIEW OF EXPOSURE TO THE REAL ESTATE SECTOR

07/01/2011 826/2010 – 11

CCO/CPPD-ADV/93/2010 – 11

REPORTING OF IRREGULARITIES – REVISION IN AUTHORITY STRUCTURE

07/01/2011 824/2010 – 11

NBG/PBU/AL-AUTOLOAN/21/2010 – 11

PERSONAL BANKING: AUTO LOANS MODIFICATION OF DOCUMENTS

07/01/2011 823/2010 – 11


PBBU HOME LOANS SBI EASY, ADVANTAGE AND PREMIUM – PRODUCT CODES AND DOCUMENTS

06/01/2011 822/2010 – 11

NBG/ABU/PDM-AGRI GEN/20/2010 – 11

RELAXATION OF COLLATERAL SECURITY REQUIREMENT FOR AGRICULTURAL TERM LOANS UPTO RS. 1 LAC WHERE MOVABLE ASSETS ARE NOT CREATED

06/01/2011 821/2010 – 11

RABG/RB-AC-AC/10/2010 – 11

RURAL BUSINESS REVISION OF FEES PAYABLE TO BUSINESS CORRESPONDENTS (BCS)/ BUSINESS FACILITATORS (BFS) TECHNOLOGY VENDORS AND CHARGES TO BE RECOVERED FROM CUSTOMERS

05/01/2011 820/2010 – 11 NBG/ABU/PDM-AGR /19/2010 – 11

AGRI BUSINESS:IMPROVED PRICING:UPWARD REVISION AFTER BASE RATE CHANGES

04/01/2011 819/2010 – 11 CCO/CPPD-ADV/95/2010 – 11

ACCEPTANCE OF INVESTMENTS IN SELECT SBI MUTUAL FUNDS AS COLLATERAL SECURITY AND IN LIEU OF CASH MARGIN FOR THE BANK’S FUND/ NON-FUND

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819.pdf

819.pdf

819.pdf


EXPOSURES

04/01/2011 816/2010 – 11 IBG/FD/FD-PUR/IR/81/2010 – 11

CREDIT TO NRE ACCOUNT THROUGH RTGS/NEFT/NECS/ECS – ISSUANCE OF INWARD REMITTANCE CERTIFICATE (FIRC)

04/01/2011 815/2010 – 11 NBG/ABU/PDM-CS/18/2010 – 11

SHORT TERM LOANS-ONLENDING LIMITS TO COLD STORAGES FOR FINANCING TO FARMERS CONCESSIONAL INTEREST@9% EXTENDED UPTO 31.03.2011

01/01/2011 811/2010 – 11 NBG/GAD-GC/15/2010 – 11

GOVERNMENT BUSINESS : CENTRAL GOVERNMENT TRANSACTIONS DEPARTMENT OF POST (DOP) : E-SCROLLS

01/01/2011 810/2010 – 11 IBG/FD/FD-MISC/80/2010 – 11

ASIAN CLEARING UNION (ACU) MECHANISM – SETTLEMENT OF TRANSACTIONS RELATING TO IRAN- 1. PAYMENTS FOR IMPORTS OF OIL & GAS, 2. INDO-IRAN TRADE


HOME LOAN NEW PRODUCTS – SBI EASY – SBI ADVANTAGE – SBI PREMIUM W E F 03012011


PERSONAL BANKING: HOME LOANS SBI HOME LOAN PAL (PRE-APPROVED LIMIT PROCESS MODIFICATION

31/12/2010 805/2010 – 11 NBG/PBU/LIMA-DEPOSIT/39/2010 – 11

NON DELIVERY OF ATM CARDS/PINS- COMPLAINTS

30/12/2010 804/2010 – 11 NBG/ABU/PDM-KCC/17/2010 – 11

NPA MANAGEMENT IN KCC-INCENTIVES TO BOOST THE RECOVERY-CAMPAIGN PERIOD:01.01.2011 TO 28.02.2011


PERSONAL BANKING ADVANCES – EDUCATION LOANS-FORTNIGHTLY REPORT HAVING SIMPLE INTEREST AFTER EXPIRY OF MORATORIUM PERIOD

29/12/2010 802/2010 – 11 CDO/P&HRD-IR/62/2010 – 11

BPR PROJECT : LHO/ZO/RO REDESIGN : ADMINISTRATIVE POWERS

29/12/2010 801/2010 – 11 NBG/SMEBU-INFUND/80/2010 – 11

RENEWAL OF INVENTORY FUNDING TO DEALERS OF HUNDAI MOTORS INDIA LTD


PERSONAL BANKING: HOME LOANS, LOAN TO VALUE (LTV) RATIO

816.pdf

816.pdf

816.pdf

815.pdf

815.pdf

815.pdf

815.pdf

811.pdf

811.pdf

811.pdf

810.pdf

810.pdf

810.pdf

810.pdf

810.pdf

808.pdf

808.pdf

808.pdf

807.pdf

807.pdf

807.pdf

805.pdf

805.pdf

804.pdf

804.pdf

804.pdf

803.pdf

803.pdf

803.pdf

803.pdf

802.pdf

802.pdf

801.pdf

801.pdf

799.pdf

799.pdf


29/12/2010 797/2010 – 11 NBG/ABU/PDM-AGR /15/2010 – 11

IMPROVED PRICING :STIMULUS TO CIRCLES FOR BUSINESS DEVELOPMENT UPTO 31.03.2011

29/12/2010 796/2010 – 11 IBG/FD/FD-NRA/FCNB/79/2010 – 11

RBI MASTER CIRCULAR OF INSTRUCTIONS RELATING TO DEPOSITS HELD IN FCNR(B) ACCOUNTS

28/12/2010 795/2010 – 11 IBG/FD/FD-NRA/FCNB/78/2010 – 11

RBI MASTER CIRCULAR ON INTT. RATES ON RUPEE DEPOSITS HELD IN DOMESTIC, ORDINARY NON-RESIDENT (NRO) & NON-RESIDENT (EXTERNAL) (NRE) ACCOUNTS

28/12/2010 794/2010 – 11 IBG/FD/FD-NRA/FCNB/77/2010 – 11

RBI MASTER CIRCULAR ON NON-RESIDENT ORDINARY RUPEE (NRO) ACCOUNT

28/12/2010 793/2010 – 11 IBG/FD/FD-NRA/FCNB/76/2010 – 11

RBI MASTER CIRCULAR ON REMITTANCE FACILITIES FOR NRI/ PERSONS OF INDIAN ORIGIN/ FOREIGN NATIONALS

28/12/2010 792/2010 – 11 NBG/PBU/LIMA-ASBA/38/2010 – 11

APPLICATION SUPPORTED BY BLOCKED AMOUNT: MODIFICATIONS


PERSONAL BANKING: CAR LOANS AUTHORIZATION OF BRANCHES: EXTENSION OF PERIOD


PERSONAL BANKING – RETURN OF DISCREPANT ACCOUNT OPENING FORMS: RECOVERY OF POSTAGE AND HANDLING CHARGES


PERSONAL BANKING – CHEQUE PERSONALISATION AND CHANGE IN CIF

27/12/2010 787/2010 – 11 NBG/RRBLBCSB-LB/3/2010 – 11

SGSY GROUP LIFE INSURANCE SCHEME


COLLATERAL SECURITY REQUIREMENTS FOR AGRICULTURAL TERM LOANS UPTO RS.1 LAC WHERE MOVABLE ASSETS ARE NOT CREATED

24/12/2010 785/2010 – 11 NBG/ABU/PDM-TRACTOR/13/2010 – 11

REVISED SCORING MODEL FOR TRACTOR LOANS – IMPLEMENTATION W.E.F.01.01.2011

24/12/2010 784/2010 – 11 CCO/CPPD-ADV/90/2010 – 11

LOANS / ADVANCES AGAINST EQUITY SHARES – COMPLIANCE UNDER SECTION 19(2) OF THE BANKING REGULATION ACT

797.pdf

797.pdf

797.pdf

796.pdf

796.pdf

796.pdf

795.pdf

795.pdf

795.pdf

795.pdf

794.pdf

794.pdf

793.pdf

793.pdf

793.pdf

792.pdf

792.pdf

791.pdf

791.pdf

791.pdf

790.pdf

790.pdf

790.pdf

790.pdf

789.pdf

789.pdf

787.pdf

786.pdf

786.pdf

786.pdf

786.pdf

785.pdf

785.pdf

785.pdf

784.pdf

784.pdf

784.pdf


1949

24/12/2010 783/2010 – 11 IBG/FD/FD-MISC/75/2010 – 11

INTEGRATED FOREX MODULE (IFM) – NON-REPORTING OF FOREX TRANSACTIONS (DEPOSITS/LOANS) IN MERCURY FX

24/12/2010 782/2010 – 11 IBG/FD/FD-MISC/74/2010 – 11

ATTEMPTED FRAUD –ISSUE OF STDR & BLOCKED FUNDS CONFIRMATION WITHOUT FUNDING – AMOUNT –RS 50.00 CRORE

24/12/2010 781/2010 – 11 CS&NB/CS&NB-PPI/12/2010 – 11

ISSUANCE AND OPERATION OF PREPAID PAYMENT INSTRUMENTS – MAINTAINING ESCROW ACCOUNT FOR OTHER/NON-BANK PERSONS ISSUING PRE-PAID PAYMENT INSTRUMENTS

23/12/2010 780/2010 – 11 IBG/FD/FD-MISC/73/2010 – 11

COUNTRY –KUWAIT – INTRODUCTION OF INTERNATIONAL BANK ACCOUNT NUMBER (IBAN)

22/12/2010 777/2010 – 11 IBG/FD/FD-CRBE/72/2010 – 11

CAUTIONARY INSTRUCTIONS – COUNTRY RISK AND BANK EXPOSURE (CRBE) – RISK CATEGORY-WISE LIST OF COUNTRIES

22/12/2010 776/2010 – 11 NBG/SMEBU-RBI GUIDEL/78/2010 – 11

SME : OWNERSHIP OF UNITS–TWO OR MORE UNDERTAKINGS UNDER THE SAME OWNERSHIP–STATUS OF THE UNIT

22/12/2010 775/2010 – 11 CDO/P&HRD-PPFG/61/2010 – 11

ACQUISITION OF STATE BANK OF INDORE BY STATE BANK OF INDIA RETIRED EMPLOYEES¿ MEDICAL BENEFIT SCHEME

21/12/2010 774/2010 – 11 NBG/PB/C&ITU-DSP/37/2010 – 11

DEFENCE SALARY PACKAGE (DSP) AND PARA MILITARY SALARY PACKAGE (PMSP) – XPRESS CREDIT- CLARIFICATIONS

16/12/2010 773/2010 – 11

NBG/ABU/BP-ADWRS/11/2010 – 11

SPECIAL INCENTIVE TO BRANCHES – ‘UNDER MODIFIED ‘OTS WITHIN OTS’ (ADW&DR SCHEME,2008)

16/12/2010 772/2010 – 11

CDO/P&HRD-CM/60/2010 – 11

SCHEME FOR REIMBURSEMENT OF EXAMINATION FEE CERTIFIED INFORMATION SYSTEM BANKER EXAMINATION CONDUCTED BY THE INDIAN INSTITUE OF BANKING AND FINANCE (IIBF)

16/12/2010 771/2010 – 11

NBG/PBU/PL-GENERAL/24/2010 – 11

LOANS/ADVANCES AGAINST EQUITY SHARES – COMPLIANCE UNDER SECTION 19(2) OF THE BANKING REGULATION ACT 1949

16/12/2010 770/2010 NBG/PB/C&ITU- NEW PRODUCT-RAILWAY SALARY PACKAGE(RSP)

783.pdf

783.pdf

783.pdf

782.pdf

782.pdf

782.pdf

782.pdf

781.pdf

781.pdf

781.pdf

781.pdf

781.pdf

780.pdf

780.pdf

780.pdf

777.pdf

777.pdf

777.pdf

776.pdf

776.pdf

776.pdf

775.pdf

775.pdf

775.pdf

774.pdf

774.pdf

774.pdf

773.pdf

773.pdf

773.pdf

773.pdf

772.pdf

772.pdf

772.pdf

772.pdf

772.pdf

772.pdf

771.pdf

771.pdf

771.pdf

771.pdf

770.pdf

770.pdf


– 11 CSP/36/2010 – 11

15/12/2010 764/2010 – 11


COMPETTITVE PRICING UNDER BASE RATE REGIME

14/12/2010 762/2010 – 11


PERSONAL BANKING : HOME LOANS HOME LOAN ACCOUNTS OPENED WITH INCORRECT SUB-PRODUCT CODES CHANGE IN SUB PRODUCT CODE FROM BACK END

13/12/2010 761/2010 – 11

NBG/BOD-FMC/68/2010 – 11

FRAUDS – CLASSIFICTION AND REPORTING MASTER CIRCULAR CLOSURE OF FRAUD CASES

13/12/2010 760/2010 – 11

IBG/FD/FD-FCTC/CC/69/2010 – 11

FOREIGN CURRENCY TRAVELLERS CHEQUES (FCTC) – AMERICAN EXPRESS BANK (AEB) TRAVELLERS CHEQUES – PRECAUTIONARY MEASURES TO BE TAKEN BY BRANCHES AGAINST FRAUDULENT ENCASHMENT

13/12/2010 759/2010 – 11

NBG/SMEBU-SME ADVANC/76/2010 – 11

EXCESS DRAWING IN WORKING CAPITAL ACCOUNTS AT BPR CENTRES.

11/12/2010 758/2010 – 11

NBG/SMEBU-DOCTORPLUS/75/2010 – 11

DOCTOR PLUS SCHEME- MODIFICATION

11/12/2010 757/2010 – 11

CDO/P&HRD-PM/59/2010 – 11

FACILITY OF LEASED ACCOMMODATION AT A PLACE OF CHOICE TO OFFICERS IN SCALE VI & VII DEPUTED TO RRB’S

11/12/2010 756/2010 – 11

IT/GLOBALIT-ATM/15/2010 – 11

RECONCILIATION OF ATM CASH BALANCE ACCOUNT (3198) WITH ADMIN BALANCE / PHYSICAL CASH REPLENISHMENT OF CASH IN ATMS

10/12/2010 755/2010 – 11


CREDIT LINKED CAPITAL SUBSIDY SCHEME (CLCSS) FOR TECHNOLOGY – UPGRADATION OF SSI BEING IMPLEMENTED BY MINISTRY OF MICRO SMALL AND MEDIUM ENTERPRISES

10/12/2010 754/2010 – 11


MIGRATION TO ADVANCED APPROACHES UNDER BASEL II FRAMEWORK – CAPTURE OF RECOVERY AND COST DETAILS IN RESPECT OF WRITTEN OFF/ AUCA ACCOUNTS

10/12/2010 753/2010 – 11


CRA-REVIEW – RAMIP MODEL

09/12/2010 751/2010 – 11


PBBU: HOME LOANS IMPLEMENTATION OF RETAIL SCORING MODELS

07/12/2010 749/2010 – 11

NBG/PBU/AL-CARLOANS/17/2010 –

PERSONAL BANKING: CAR LOAN SBI ADVANTAGE CAR LOAN SCHEME MODIFICATIONS: EMI/NMI

764.pdf

764.pdf

762.pdf

762.pdf

762.pdf

762.pdf

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756.pdf

756.pdf

755.pdf

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755.pdf

755.pdf

754.pdf

754.pdf

754.pdf

754.pdf

753.pdf

751.pdf

751.pdf

749.pdf

749.pdf


11 RATIO

06/12/2010 748/2010 – 11


MODIFICATIONS IN CSP DSP

06/12/2010 746/2010 – 11

NBG/PB/C&ITU-DSP/32/2010 – 11

CAMPAIGN RESULTS –JAL VAYU CAMPAIGN

06/12/2010 743/2010 – 11

CDO/P&HRD-PM/58/2010 – 11

(1) INTRODUCTION OF DEFINED CONTRIBUTION PENSION SCHEME/NEW PENSION SCHEME FOR ALL CATEGORIES OF NEWLY RECRUITED OFFICERS AND EMPLOYEES W.E.F. 01.08.2010 (2) AMENDMENT OF SBIOSR,1992 & UTCS OF M.O.

04/12/2010 742/2010 – 11

IBG/FD/FD-AACBR/68/2010 – 11

CORRESPONDENT RELATIONS – ISSUANCE OF BG/ CONFIRMATION OF LC – COMPLAINTS BY CORRESPONDENT BANKS

04/12/2010 741/2010 – 11


CLEINTELE BUSINESS IN CURRENCY FURTURES – SBI FX TRADE

03/12/2010 740/2010 – 11

NBG/PBU/LIMA-ASBA/35/2010 – 11

APPLICATION SUPPORTED BY BLOCKED AMOUNT – NEW FUND OFFER (NFO) OF MUTUAL FUNDS : CHANGES MADE BY THE REGULATOR

03/12/2010 739/2010 – 11


ACCEPTING DUPLICATE PIN REQUESTS FROM CUSTOMERS THROUGH CONTACT CENTRE

02/12/2010 737/2010 – 11

RABG/RB-AC-AC/9/2010 – 11

FINANCIAL INCLUSION BY EXTENSION OF BANKING SERVICES : USE OF BUSINESS CORRESPONDENTS ( BCS), ENGAGEMENT OF PROFIT COMPANIES

02/12/2010 736/2010 – 11


PERSONAL BANKING: HOME LOANS IMPROVED PROCESS FOR BUILDER TIE-UPS

01/12/2010 734/2010 – 11


STRESSED ASSETS MANAGEMENT – ADVANCES UNDER COLLECTION ACCOUNT (AUCA) – MODIFICATION IN POLICY

01/12/2010 733/2010 – 11

NBG/SMEBU-BUSINES SH/71/2010 – 11

SHARING OF BUSINESS BETWEEN NBG AND MCG

01/12/2010 732/2010 – 11

NBG/ABU/BP-AGRI GOLD/10/2010 – 11

QUICK LOAN PRODUCT FOR AGRI GOLD LOAN

30/11/2010 731/2010 – 11

CS&NB/CS&NB-TECH/11/2010 – 11

MOBILE BANKING SERVICE (MBS) – INSERTION OF MBS LEAFLETS IN THE WELCOME KITS

30/11/2010 730/2010 – 11


PERSONAL BANKING: HOME LOANS APPROVAL OF SPECIFIC PROJECT OF BUILDERS UNDER NORMAL ROUTE: MODIFICATION

29/11/2010 728/2010 CCO/CPPD- POLICY FOR DEALING WITH INCIDENCE OF

748.pdf

746.pdf

743.pdf

743.pdf

743.pdf

743.pdf

743.pdf

742.pdf

742.pdf

742.pdf

741.pdf

741.pdf

740.pdf

740.pdf

740.pdf

739.pdf

739.pdf

737.pdf

737.pdf

737.pdf

737.pdf

736.pdf

736.pdf

734.pdf

734.pdf

734.pdf

733.pdf

732.pdf

731.pdf

731.pdf

730.pdf

730.pdf

730.pdf

728.pdf


– 11 ADV/82/2010 – 11 FREQUENT DISHONOUR OF CHEQUES AND FAILED ECS

29/11/2010 727/2010 – 11


GUIDELINES ON FAIR PRACTICES CODE FOR LENDERS – DISCLOSING ALL INFORMATION RELATING TO PROCESSING FEES/CHARGES

27/11/2010 726/2010 – 11

NBG/BOD-FMC/67/2010 – 11

ATTEMPTED FRAUD : ISSUE OF STDR AND ‘BLOCKED FUNDS CONFIRMATION’ WITHOUT FUNDING AMOUNT RS.50 CRORE

27/11/2010 725/2010 – 11

NBG/BOD-FMC/66/2010 – 11

OPERATIONAL RISK IN BANKS FRAUD AMOUNT RS.8.97 CRORE : DISCOUNTING OF BILLS UNDER INLAND LETTER OF CREDIT

26/11/2010 724/2010 – 11


CORRESPONDENT RELATIONS – MERGER OF RAIFFEISEN ZENTRAL BANK OSTERREICH AG (RZB) WITH RAIFFEISEN INTERNATIONAL BANK-HOLDING AG – NEW NAME- RAIFFEISEN BANK INTERNATIONAL AG

25/11/2010 722/2010 – 11

NBG/BOD-GB/65/2010 – 11

CHEQUE COLLECTION POLICY (CCP) – 2010 REVIEW

25/11/2010 720/2010 – 11

NBG/BOD-GB/64/2010 – 11

POLICY FOR CASH RETENTION LIMIT FOR BRANCHES OTHER THAN LINKED TO CURRENCY ADMINISTRATION CELL (CAC)

25/11/2010 719/2010 – 11

NBG/BOD-GB/63/2010 – 11

ELECTRONIC PAYMENT PRODUCTS PROCESSING INWARD TRANSACTIONS BASED SOLELY ON ACCOUNT NUMBER INFORMATION

23/11/2010 714/2010 – 11

NBG/PBU/PL-GOLD/23/2010 – 11

PERSONAL BANKING ADVANCES – LOAN AGAINST PLEDGE OF GOLD ORNAMENTS – REVIEW AND MODIFICATIONS

23/11/2010 713/2010 – 11


PERSONAL SEGMENT: CAR LOANS NEW PRODUCT: CERTIFIED PRE-OWNED CAR LOAN SCHEME

23/11/2010 712/2010 – 11

NBG/S&P-SP/19/2010 – 11

OPENING OF NEW STAFF ACCOUNTS-MANDOTARY OF PF INDEX NUMBER

23/11/2010 711/2010 – 11

IBG/FD/FD-NRA/FCNB/66/2010 – 11

FCNB DEPOSITS:- REVERSAL OF PROVISION IN INR AS ON CBS TAKE ON DATE – DEBIT BALANCES IN BGL WASH ACCOUNT (98572BBBBBCD)

20/11/2010 710/2010 – 11

CFO/A&C-TAX/4/2010 – 11

CENTRALISATION OF SERVICE TAX

20/11/2010 709/2010 – 11

IBG/FD/FD-MISC/65/2010 – 11

COMMISSIONING OF OFAC FILTER AT GMU, KOLKATA & INTEGRATION WITH SIM-SIG SOLUTION

727.pdf

727.pdf

727.pdf

726.pdf

726.pdf

726.pdf

725.pdf

725.pdf

725.pdf

724.pdf

724.pdf

724.pdf

724.pdf

724.pdf

722.pdf

722.pdf

720.pdf

720.pdf

720.pdf

719.pdf

719.pdf

719.pdf

714.pdf

714.pdf

714.pdf

713.pdf

713.pdf

713.pdf

712.pdf

712.pdf

711.pdf

711.pdf

711.pdf

710.pdf

709.pdf

709.pdf

709.pdf


20/11/2010 708/2010 – 11


RBI-ANNUAL FINANCIAL INSPECTION OF WHOLE BANK – U/S 35 OF THE BR-ACT 1949-POSITION AS ON 31.03.09 COMPLIANCE WITH RBI INSPECTION REMARKS

20/11/2010 706/2010 – 11

NBG/PBU/LIMA-SB/34/2010 – 11

PERSONAL BANKING – SAVINGS BANK AND CURRENT ACCOUNTS – CHARGES FOR TRANSFER OF ACCOUNTS

19/11/2010 705/2010 – 11

CDO/P&HRD-IR/57/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN) BY SBI PAYMENT OF SALARY AND ALLOWANCES TO E-SBIN OFFICERS/EMPLOYEES

19/11/2010 704/2010 – 11

CDO/P&HRD-CM/56/2010 – 11

STAFF: OFFICERS : ACQUISITION OF STATE BANK OF INDORE BY SBI : COMPUTATION OF INTER-SE SENIORITY OF OFFICERS

19/11/2010 703/2010 – 11


KYC GUIDELINES FOR OPENING OF BANK ACCOUNTS FOR SALARIED EMPLOYEES

16/11/2010 702/2010 – 11

CDO/P&HRD-IR/55/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN) BY SBI : AWARD STAFF: INTER-SE SENIORITY

16/11/2010 701/2010 – 11

CDO/P&HRD-IR/54/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN) BY SBI : LOANS AND ADVANCES TO EMPLOYEES/OFFICERS OF E-SBIN

16/11/2010 700/2010 – 11

CDO/P&HRD-IR/53/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN) BY SBI : STAFF AWARD : SPECIAL PAY (ALLOWANCE) CARRYING POSITIONS

16/11/2010 699/2010 – 11

NBG/SMEBU-SMECARLOAN/67/2010 – 11

SME CAR LOAN

16/11/2010 698/2010 – 11

NBG/SMEBU-SMECFL/66/2010 – 11

SBI SME COLLATERAL FREE LOANS SCHEME (SME-CFL)–INTEREST RATE AND MODIFICATION IN THE SCHEME

16/11/2010 697/2010 – 11


HOME LOANS: LOAN TO VALUE (LTV) RATIO

15/11/2010 695/2010 – 11


RECONCILIATION OF ATM CORE TRANSACTION ACCOUNT (98549) WITH ADMIN BALANCE / PHYSICAL CASH OPENING OF NEW BGL ACCOUNT (3198) IN PLACE OF 98549

13/11/2010 694/2010 – 11

NBG/PBU/LIMA-Persona/33/2010 – 11

PERSONAL BANKING RETURN OF CHEQUE BOOKS SENT BY LCPCS THROUGH SPEED POST

13/11/2010 693/2010 – 11

CDO/CRPD-RECT/7/2010 – 11

RECRUITMENT OF INFORMATION TECHNOLOGY SPECIALIST OFFICERS (ITSO) IN STATE BANK OF INDIA ADVERTISEMENT NO. CRPD/ ITSO/2010-

708.pdf

708.pdf

708.pdf

708.pdf

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704.pdf

704.pdf

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695.pdf

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693.pdf

693.pdf

693.pdf


11/06

12/11/2010 691/2010 – 11


PERSONAL BANKING BUSINESS UNIT CORPORATE AND INSTITUTIONAL TIE-UPS NEW PRODUCT: STATE GOVERNMENT SALARY PACKAGE (SGSP) FOR PERMANENT EMPLOYEES OF STATE GOVERNMENTS AND UNION TERRITORIES WITH NEW CUS

12/11/2010 690/2010 – 11

NBG/SMEBU-E/64/2010 – 11

EDFS-TIE UP WITH HONDA MOTORCYCLE AND SCOOTER INDIA PVT. LTD.

12/11/2010 688/2010 – 11


BANK’S EXPOSURE TO CAPITAL MARKET ISSUE OF IRREVOCABLE PAYMENT COMMITMENTS (IPCS)

11/11/2010 686/2010 – 11


PERSONAL BANKING: CORPORATE AND INSTITUTIONAL TIE-UPS DEPARTMENT: NEW PRODUCT: DEFENCE SALARY PACKAGE (GENERAL RESERVE ENGINEER FORCE) – DSP (GREF)

11/11/2010 685/2010 – 11

CAG/CMP-REFUND/104/2010 – 11

STATE BANK OF INDIA: PUBLIC ISSUE OF BONDS – REFUND WARRANTS

11/11/2010 683/2010 – 11

CCO/CPPD-C P/75/2010 – 11

REPORTING OF COMMERCIAL PAPER ISSUANCES

11/11/2010 682/2010 – 11

IT/GLOBALIT-PSG/12/2010 – 11

ELECTRONIC FUNDS TRANSFER INFRASTRUCTURE IN INDIA

11/11/2010 681/2010 – 11

NBG/ABU/PDM-KCC/12/2010 – 11

RELAXATION OF COLLATERAL SECURITY REQUIREMENT FOR CROP LOANS UPTO RS 2 LACS FOR BORROWERS WITH GOOD TRACK RECORD

10/11/2010 680/2010 – 11

CDO/P&HRD-CM/52/2010 – 11

REWARD AND RECOGNITION BEST AGM (REGION) SCHEME MODIFICATIONS

10/11/2010 679/2010 – 11

NBG/SMEBU-E/62/2010 – 11

SUPPLY CHAIN FINANCE- ELECTRONIC DEALER FINANCING SCHEME (E-DFS)

10/11/2010 678/2010 – 11

CDO/ORG-BPR MANUALS/25/2010 – 11

CURRENCY ADMINISTRATION CELL (CAC) – PROCESS MANUAL..

09/11/2010 676/2010 – 11


PBBU : GUIDELINES ON DEALING WITH CIBIL CREDIT INFORMATION REPORT

08/11/2010 669/2010 – 11

IT/GLOBALIT-INB/11/2010 – 11

INTERNET BANKING GENERIC E-PAYMENT MODULE I-COLLECT

03/11/2010 665/2010 – 11

NBG/BOD-KYC/53/2010 – 11

KYC GUIDELINES OPENING OF BANK ACCOUNTS – SALARIED EMPLOYEES

691.pdf

691.pdf

691.pdf

691.pdf

691.pdf

691.pdf

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02/11/2010 664/2010 – 11


WESTERN UNION FINANCIAL SERVICES DATA CAPTURE GUIDELINES UNDER NEW KYC NORMS

02/11/2010 663/2010 – 11


PERSONAL BANKING ADVANCES EDUCATION LOANS INTEREST SUBSIDY SCHEME FOR ECONOMICALLY WEAKER SECTION (EWS), TAG/ MARKER & OTHER DEVELOPMENTS IN ACCOUNT OPENING SCREEN

02/11/2010 662/2010 – 11

NBG/PBU/PL-PERLOANS/21/2010 – 11

PERSONAL BANKING SEGMENT PERSONAL LOANS UNDER XPRESS CREDIT LOAN VERIFICATION OF ADDRESS OF THE BORROWER

02/11/2010 660/2010 – 11

NBG/RRBLBCSB-LB/2/2010 – 11

MASTER CIRCULAR : PRIME MINISTER’S EMPLOYMENT GENERATION PROGRAMME (PMEGP)

01/11/2010 659/2010 – 11


SMALL AND MEDIUM ENTERPRISES CITY CREDIT CENTRE (SMECC) ROLE MANUAL

01/11/2010 658/2010 – 11


CORE SALES AND SERVICE BRANCH WITH OTHER MODULES AND RETAIL ASSETS (CORE SSB): PROCESS AND ROLE MANUAL.

01/11/2010 657/2010 – 11


CURRENCY ADMINISTRATION CELL (CAC) ROLE MANUAL: REPLENISHMENT OF CASH AT OFF-SITE ATMS

01/11/2010 656/2010 – 11


CURRENCY ADMINISTRATION CELL (CAC) REPLENISHMENT OF CASH AT OFF-SITE ATMS – PROCESS MANUAL

01/11/2010 655/2010 – 11


CURRENCY ADMINISTRATION CELL (CAC) ROLE MANUAL.

01/11/2010 654/2010 – 11

NBG/BOD-CAS/52/2010 – 11

CREDIT AUDIT PROVISION OF PENALTY FOR NON CLOSURE OF REPORT – REVISION

30/10/2010 651/2010 – 11

CFO/A&C-TAX/3/2010 – 11

CENTRALISATION OF SERVICE TAX PAYMENT651.pdf

30/10/2010 650/2010 – 11

CCO/CPPD-INT/74/2010 – 11

INCIDENCE OF FRAUD

30/10/2010 647/2010 – 11

NBG/PBU/LIMA-PB/31/2010 – 11

PERSONAL BANKING RETURN OF DISCREPANT ACCOUNT OPENING FORMS RECOVERY OF POSTAGE AND HANDLING CHARGES

30/10/2010 646/2010 – 11

NBG/PBU/LIMA-PB/30/2010 – 11

PERSONAL BANKING: BLOCKING OF RECURRING DEPOSIT BACKDATE OPENING OF ACCOUNTS

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30/10/2010 644/2010 – 11

NBG/PBU/LIMA-SAVINGS/29/2010 – 11

OPENING AND OPERATING THE ACCOUNTS OF THE BENEFICIARIES OF INDIRA GANDHI NATIONAL OLD AGE PENSION SCHEME

30/10/2010 636/2010 – 11


HOME LOANS :INTEREST SUBSIDY SCHEME FOR HOUSING URBAN POOR (ISHUP PRODUCT CODE: 6251-2504 ( FIXED RATE), 6251-2505 (FLOATING RATE): RELAXATIONS

30/10/2010 634/2010 – 11

NBG/SMEBU-WAREHOUSE/59/2010 – 11

NBHC- RENEWAL OF COLLATERAL MANAGEMENT AGREEMENT

29/10/2010 633/2010 – 11


LAUNCH OF CAMPAIGN ‘ MISSION CYBER POWER II ‘ TIE UP WITH HCL FOR SALE OF COMPUTERS AT DISCOUNTED PRICES TO BANK STAFF , DSP, PMSP AND OTHER CSP ACCOUNT HOLDERS

29/10/2010 632/2010 – 11


LAUNCH OF CAMPAIGN TRISHUL FOR OPENING ACCOUNTS OF DEFENCE OFFICERS

28/10/2010 631/2010 – 11

NBG/S&P-SP/18/2010 – 11

CHARGES-OVERHEADS SCRUTINY OF RETURNS AND SUBMISSION OF CERTIFICATE AMENDMENT

27/10/2010 630/2010 – 11

CDO/P&HRD-IR/49/2010 – 11

ACQUISITION OF STATE BANK OF INDORE BY STATE BANK OF INDIA USER CAPABILITY AND PASSING POWERS

27/10/2010 629/2010 – 11

IBG/FD/FD-EXPORTS/63/2010 – 11

ADVANCE PAYMENT AGAINST EXPORTS

27/10/2010 628/2010 – 11

IBG/FD/FD-IMPORTS/62/2010 – 11

ADVANCE REMITTANCE FOR IMPORTS – GUIDELINES FOR FOLLOW-UP

27/10/2010 627/2010 – 11

CDO/P&HRD-PM/48/2010 – 11

PERFORMANCE LINKED INCENTIVE SCHEME TEAM INCENTIVE AND INDIVIDUAL INCENTIVE FOR THE YEAR 2008- 2009 AND ONWARDS BPR POSITIONS: CLARIFICATIONS

27/10/2010 626/2010 – 11

CDO/P&HRD-PM/47/2010 – 11

LEAVE TRAVEL CONCESSION/ HOME TRAVEL CONCESSION AVAILMENT OF LTC/HTC AFTER RETIREMENT AMENDMENT IN RULE 44(7) OF STATE BANK OF INDIA OFFICERS¿ SERVICE RULES (SBIOSR), 1992

26/10/2010 619/2010 – 11


PERSONAL BANKING ADVANCES CREATION OF NEW PRODUCT CODES FOR DEMAND LOAN AND OVERDRAFT AGAINST FLOATING RATE TERM DEPOSIT (FRTD)

26/10/2010 618/2010 – 11

CS&NB/CS&NB-DPA/10/2010 – 11

DEPOSITORY PARTICIPANT ACTIVITY – ANTI MONEY LAUNDERING POLICY: ISSUANCE OF

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OPERATING GUIDELINES

25/10/2010 617/2010 – 11

CCO/CPPD-CIBIL/68/2010 – 11

DATA REPORTING – UP-DATION OF CIBIL RECORDS AND STRENGTHENING THE INTERNAL MACHINERY FOR CUSTOMER GRIEVANCES REDRESSAL

25/10/2010 616/2010 – 11


SUBMISSION OF CREDIT DATA TO RESERVE BANK OF INDIA (RBI) AND CREDIT INFORMATION BUREAU OF INDIA LTD.,(CIBIL) INCLUSION OF DIRECTOR IDENTIFICATION NUMBER (DIN)

25/10/2010 615/2010 – 11

CCO/CPPD-PRUDENTIAL/66/2010 – 11

PRUDENTIAL GUIDELINES ON RESTRUCTURING OF ADVANCES BY BANKS PROMOTORS CONTRIBUTION-RECENT CLARIFICATION BY RBI ON GUIDELINES ISSUED IN AUGUST 2008.

25/10/2010 614/2010 – 11

CCO/CPPD-INT/65/2010 – 11

RUPEE EXPORT CREDIT INTEREST RATES – INTEREST SUBVENTION – INCLUSION OF ADDITIONAL SECTORS- SUB SECTORS – EXPORT CREDIT TO CERTAIN EMPLOYMENT ORIENTED EXPORT SECTOR

25/10/2010 613/2010 – 11


PRUDENTIAL NORMS FOR OFF BALANCE SHEET EXPOSURES OF BANKS BILATERAL NETTING OF COUNTERPARTY CREDIT EXPOSURES

25/10/2010 609/2010 – 11

NBG/GAD-GC/14/2010 – 11

GOVERNMENT BUSINESS : TRANSFER OF BALANCE, STATE GOVERNMENT BALANCE AS ON 31.10.2010 TO BE DONE ON 20.11.2010

23/10/2010 608/2010 – 11

NBG/ABU/PDM-DAIRY FI/11/2010 – 11

AGRI BUSINESS: DAIRY AND POULTRY VENTURE CAPITAL FUNDS- DAIRY ENTREPRENEURSHIP DEVELOPMENT SCHEME (DEDS)

23/10/2010 607/2010 – 11


PERSONAL BANKING : CAR LOANS; FESTIVAL SEASON: AUTHORISATION OF BRANCHES

23/10/2010 606/2010 – 11

NBG/SMEBU-EPFO/57/2010 – 11

RENEWAL OF AGREEMENT WITH EPFO REGARDING BANKING ARRANGEMENT

22/10/2010 605/2010 – 11

NBG/BOD-GB/50/2010 – 11

DIRECTIVE ON SETTLEMENT AND DEFAULT HANDLING PROCEDURES IN MULTILATERAL AND DEFERRED NET SETTLEMENT SYSTEMS UNDER THE PAYMENT AND SETTLEMENT SYSTEMS ACT, 2007

22/10/2010 604/2010 – 11

NBG/BOD-GB/49/2010 – 11

DISPUTE RESOLUTION MECHANISM UNDER THE PAYMENT AND SETTLEMENT SYSTEMS ACT, 2007

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21/10/2010 603/2010 – 11


ADDITIONAL DISCOUNT ON GOLD COINS TO SALARY ACCOUNT HOLDERS OF GOVT AND PSU

21/10/2010 602/2010 – 11


REGISTRATION OF COMPLAINTS RELATING TO ATM SERVICES/PAYEMENT GATEWAY TRANSACTIONS IN COMPLAINT MANAGEMENT SYSTEM (CMS)

21/10/2010 601/2010 – 11

NBG/S&P-SP/17/2010 – 11

ENHANCEMENT OF CUTOFF LIMIT FOR DOUBLE SIGNATURE IN IOI INSTRUMENTS FROM 50,000/- TO 1,50,000/-

20/10/2010 600/2010 – 11

NBG/BOD-GB/48/2010 – 11

COLLECTION OF THIRD PARTY ACCOUNT PAYEE CHEQUES PROHIBITION ON CREDITING PROCEEDS TO THIRD PARTY ACCOUNTS

20/10/2010 595/2010 – 11

CDO/P&HRD-IR/46/2010 – 11

PROMOTION FROM CLERICAL TO JMGS-I TRAINEE OFFICER CHANNEL PROMOTION YEAR 2010-11

19/10/2010 594/2010 – 11


APPLICATION SUPPORTED BY BLOCKED AMOUNT (ASBA) – AVAILIBILITY OF APPLICATION FORMS: BULK DOWNLOAD

18/10/2010 592/2010 – 11


AIDE-MEMOIRE ON CREDIT GUARANTEE FUND TRUST FOR MICRO AND SMALL ENTERPRISES(CGTMSE)

16/10/2010 591/2010 – 11

CS&NB/CS&NB-PPI/9/2010 – 11

INTERNET BANKING: GIFT CARD – ONLINE PURCHASE FACILITY FOR RETAIL INB CUSTOMERS

14/10/2010 582/2010 – 11


MOBILE BANKING SERVICE INTERBANK MOBILE PAYMENT SERVICE (IMPS)

13/10/2010 579/2010 – 11

NBG/GAD-OTLAS/13/2010 – 11

GOVERNMENT BUSINESS : PERMISSIBLE PERIOD FOR REMMITTANCE OF E-PAYMENTS INTO GOVERNMENT ACCOUNTS BY PUBLIC SECTOR BANKS

13/10/2010 578/2010 – 11

CFO/SHAREBON-BONDS/1/2010 – 11

STATE BANK OF INDIA PUBLIC ISSUE OF BONDS -2010

11/10/2010 571/2010 – 11


HOME LOANS : NEW PRODUCT SBI YUVA HOME LOAN

11/10/2010 570/2010 – 11


PERSONAL BANKING ADVANCES EDUCATION LOANS – COMPLAINTS REVIEW MEETING OF BANKING SECTOR, DIRECTORATE OF PUBLIC GRIEVANCES, GOVT. OF INDIA

11/10/2010 569/2010 – 11


PERSONAL BANKING ADVANCES EDUCATION LOANS INTERNET BANKING FOR EDUCATION LOAN BORROWERS

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11/10/2010 568/2010 – 11

CDO/P&HRD-IR/45/2010 – 11

PROMOTION FROM CLERICAL CADRE TO JMGS-I TRAINEE OFFICER CHANNEL PROMOTION YEAR 2010-11 SUPPLEMENTARY EXAMINATION

09/10/2010 567/2010 – 11

CCO/CPPD-BASEL/63/2010 – 11

RBI GUIDELINES DATED 1ST JULY 2010 ON BASEL II NEW CAPITAL ADEQUACY FRAMEWORK (NCAF) – INTRODUCTION OF AN UNCONDITIONAL CANCELLABILITY CLAUSE IN THE LOAN DOCUMENTS

09/10/2010 566/2010 – 11


BANK LOANS FOR FINANCING PROMOTERS CONTRIBUTION

09/10/2010 563/2010 – 11


BANK’S EXPOSURE TO CAPITAL MARKETS – ISSUE OF IRREVOCABLE PAYMENT COMMITMENTS (IPCS)

09/10/2010 562/2010 – 11

CDO/P&HRD-IR/44/2010 – 11

PROMOTION FROM CLERICAL CADRE TO JMGS-I PROMOTION YEAR 2010-11 TRAINEE OFFICER CHANNEL : SUPPLEMENTARY EXAMINATION EMPLOYEES OF ERSTWHILE STATE BANK OF INDORE

08/10/2010 561/2010 – 11

NBG/BOD-GB/47/2010 – 11

GOVERNMENT BANKING PROVISION OF E-FREIGHT FACILITY TO CUSTOMERS RECOVERY OF SERVICE CHARGES

08/10/2010 560/2010 – 11

CDO/P&HRD-PM/43/2010 – 11

PERMANENT FULL TIME/PART TIME MEDICAL OFFICERS

07/10/2010 559/2010 – 11

NBG/BOD-GB/46/2010 – 11

DISHONOUR / RETURN OF CHEQUES – NEED TO MENTION THE ‘DATE OF RETURN’ IN THE CHEQUE RETURN MEMO

07/10/2010 558/2010 – 11


VISHWA YATRA FOREIGN TRAVEL CARD (FTC) – DEVELOPMENT OF COMMON INTERFACE

07/10/2010 557/2010 – 11

NBG/ABU/PDM-AGRI /10/2010 – 11

AGRI GOLD LOANS-INCENTIVES TO BOOST THE BUSINESS-GOLD LOAN CAMPAIGN

07/10/2010 556/2010 – 11


IN BRANCH CASH HANDLING AT HAND BALANCE / CURRENCY CHEST BRANCHES (IBCH) – PROCESS MANUAL.

06/10/2010 553/2010 – 11


XPRESS CREDIT MODIFICATION IN ELIGIBLE LOAN AMOUNT AND REPAYMENT TERM

06/10/2010 552/2010 – 11

CDO/P&HRD-IR/42/2010 – 11

PAYMENT OF FIXED PERSONAL PAY ON PROMOTION FROM ONE CADRE TO A HIGHER CADRE OR FROM ONE SCALE TO A HIGHER SCALE

06/10/2010 550/2010 – 11

NBG/BOD-GB/45/2010 – 11

IMPLEMENTATION OF “CTS-2010 STANDARD” STANDARISATION AND ENHANCEMENT OF

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SECURITY FEATURES IN CHEQUE FORMS

06/10/2010 549/2010 – 11

NBG/BOD-GB/44/2010 – 11

STATE BANK OF INDIA POLICY FOR DEALING WITH INCIDENTS OF FREQUENT DISHONOUR OF CHEQUES AND FAILED ECS

06/10/2010 548/2010 – 11


CGTMSE–IMPLEMETATION OF PORTFOLIO CREDIT GUARANTEE SCHEME(PCGS)

05/10/2010 545/2010 – 11


AGENCY ARRANGEMENTS & CORRESPONDENT RELATIONS – CLOSURE OF NOSTRO ACCOUNTS – ERSTWHILE STATE BANK OF SAURASHTRA (SBS) NOSTRO A/CS

05/10/2010 544/2010 – 11

NBG/SMEBU-RENTPLUS/52/2010 – 11

CONCESSIONARY PRICING FOR SELECT GROUP

04/10/2010 525/2010 – 11


RURAL BUSINESS: OPPORTUNITY FOR PERMANENT ABSORPTION TO OFFICERS APPOINTED ON CONTRACT: ROLE AND RESPONSIBILITIES

04/10/2010 523/2010 – 11


RURAL BUSINESS: OPENING OF NO- FRILL ACCOUNTS BY STUDENTS FOR AVAILING VARIOUS GOVERNMENT SCHOLARSHIPS

01/10/2010 522/2010 – 11

NBG/S&P-SP/16/2010 – 11

DISCONTINUATION OF NON HOME TRANSACTIONS REGISTER

01/10/2010 521/2010 – 11


FOREIGN CURRENCY TRAVELLERS CHEQUES (FCTC) – SALE OF AMERICAN EXPRESS BANK (AEB) TRAVELLERS CHEQUES – REVIEW & RENEWAL OF ARRANGEMENT

30/09/2010 518/2010 – 11


CENTRALIZED CLEARING PROCESSING CENTRE (CCPC) MICR FILE UPLOAD (AMRITSAR) MODEL CPC MANUAL AND ROLE DEFINITIONS

30/09/2010 517/2010 – 11


CENTRALIZED CLEARING PROCESSING CENTRE (CCPC) MICR FILE UPLOAD (AMRITSAR) MODEL MICR CLEARING PROCESS MANUAL

30/09/2010 516/2010 – 11


CENTRALIZED CLEARING PROCESSING CENTRE (CCPC) HSPE FILE UPLOAD (MUMBAI) MODEL CPC MANUAL AND ROLE DEFINITIONS.

30/09/2010 515/2010 – 11


CENTRALIZED CLEARING PROCESSING CENTRE (CCPC) ELECTRONIC CLEARING SERVICES (ECS) INWARD DEBIT PROCESS MANUAL

30/09/2010 514/2010 – 11


EXTENSION OF 50 BPS INTEREST CONCESSION

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29/09/2010 513/2010 – 11


LIABILITY CENTRAL PROCESSING CENTRE (LCPC) – PROCESS MANUAL

29/09/2010 512/2010 – 11


LIABILITY CENTRAL PROCESSING CENTRE (LCPC)- ROLE MANUAL

29/09/2010 511/2010 – 11


CENTRALISED PENSION PROCESSING CENTRE (CPPC) – ROLE MANUAL

29/09/2010 510/2010 – 11


CENTRALISED PENSION PROCESSING CENTRE (CPPC) – PROCESS MANUAL.

29/09/2010 509/2010 – 11

CDO/P&HRD-IR/41/2010 – 11

WORKMEN STAFF – SALARY REVISION SPECIAL PAY – HEAD ASSISTANT (ACCOUNTS)

29/09/2010 508/2010 – 11

CDO/P&HRD-IR/40/2010 – 11

REVIEW OF PROMOTION POLICY : CLERICAL TO OFFICERS CADRE: TRAINEE OFFICER CHANNEL SUPPLEMENTARY EXAMINATION

29/09/2010 507/2010 – 11


RECRUITMENT OF CLERICAL STAFF IN ASSOCIATE BANKS OF STATE BANK OF INDIA ADVERTISEMENT NO. CRPD/ ABCL/ 2010-11/ 04

29/09/2010 506/2010 – 11


PERSONAL BANKING ADVANCES PERSONAL LOANS COLLATERAL IN LOAN AGAINST BANK’S OWN TIME DEPOSITS

29/09/2010 505/2010 – 11


PERSONAL BANKING ADVANCES INTEREST SUBSIDY SCHEME ON EDUCATION LOAN FOR ECONOMICALLY WEAKER SECTION PROPOSED BY MINISTRY OF HRD, GOVT. OF INDIA

28/09/2010 503/2010 – 11


HOME LOAN SALES TEAM (HLST) – ROLE & PROCESS MANUAL

28/09/2010 502/2010 – 11


GRAHAK MITRA- ROLE MANUAL

27/09/2010 500/2010 – 11


PBBU : INTEREST RATES (I) SBI EASY HOME LOAN (II) SBI ADVANTAGE HOME LOAN; ENHANCEMENT OF CEILING ON SBI MAXGAIN HOME LOAN TO RS.1 CR

27/09/2010 499/2010 – 11

IBG/FD/FD-PUR/IR/57/2010 – 11

REPORTING UNDER FOREIGN DIRECT INVESTMENT (FDI) SCHEME

27/09/2010 498/2010 – 11

NBG/SMEBU-CLSME/49/2010 – 11

SME CAR LOAN – AMENDMENTS

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27/09/2010 497/2010 – 11


STRESSED ASSETS RESOLUTION CENTRE (SARC) PROCESS MANUAL.

27/09/2010 496/2010 – 11


STRESSED ASSETS RESOLUTION CENTRE (SARC) ROLE MANUAL

27/09/2010 495/2010 – 11


RELATIONSHIP MANAGER (MEDIUM ENTERPRISES) – PROCESS MANUAL

25/09/2010 492/2010 – 11


EXAMINATION OF STAFF ACCOUNTABILITY: CREDIT RELATED CONSOLIDATED INSTRUCTIONS POST CIRCLE REDESIGN

25/09/2010 491/2010 – 11


CENTRALISED SETTLEMENT & RECONCILIATION OF PUBLIC PROVIDENT FUND TRANSACTIONS (CSRP)- ROLE AND PROCESS MANUAL..

25/09/2010 490/2010 – 11


MULTI PRODUCT SALES TEAM (MPST) – ROLE AND PROCESS MANUAL

24/09/2010 489/2010 – 11

RABG/RB-IT-IT/7/2010 – 11

DECONGESTION OF BRANCHES – KIOSK BANKING- CASH DEPOSIT WITHOUT FINGER PRINT VALIDATION, INSTANT REMITTANCE FACILITY FOR NON – CUSTOMERS ON KIOSK BANK

24/09/2010 488/2010 – 11


DECONGESTION OF CBS BRANCHES –INSTANT REMITTANCE FACILITY FOR NON – CUSTOMERS ON M/S EKO PLATFORM

24/09/2010 487/2010 – 11


MID CORPORATE LOAN ADMINISTRATION UNIT (MACLAU) – PROCESS MANUAL

24/09/2010 486/2010 – 11


MID CORPORATE LOAN ADMINISTRATION UNIT (MCLAU) – ROLE MANUAL

23/09/2010 478/2010 – 11

IBG/FD/FD-CAU/56/2010 – 11

OVERSEAS REGULATORY COMPLIANCE – VIOLATION OF USOFAC – CAUTION REGARDING TRANSACTIONS IN USD RELATED TO IRANIAN ENTITIES

23/09/2010 477/2010 – 11

CCO/CPPD-NPA/54/2010 – 11

APPROACH FOR SALE OF NON PERFORMING RETAIL FINANCIAL ASSETS OF SMES SECTOR TO ARCS/BANKS/FIS/NBFCS ON PORTFOLIO BASIS

23/09/2010 476/2010 – 11


INSURANCE OF ASSETS FINANCED BY THE BANK

22/09/2010 475/2010 – 11


PBBU: HOME LOANS : DISCONTINUATION OF FOUR PRODUCTS

22/09/2010 474/2010 – 11

NBG/SMEBU-PRISECTOR/47/2010 – 11

PRIORITY SECTOR ADVANCE–RECLASSIFICATION

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21/09/2010 473/2010 – 11

CCO/CPPD-SAM/52/2010 – 11

CREATION OF SAM GROUP (SAMG); HANDLING OF INSTANCES OF UNDERLYING FRAUD IN NPAS

21/09/2010 472/2010 – 11

NBG/ABU/BP-INTT. SUB/9/2010 – 11

1) INTEREST SUBVENTION SCHEME @1.5%

2) ADDITIONAL INTEREST SUBVENTION OF 2% TO PROMPT PAYING FARMERS

20/09/2010 471/2010 – 11

IBG/FD/FD-CRBE/55/2010 – 11

COUNTRY RISK MANAGEMENT – INDIRECT COUNTRY RISK EXPOSURE – REITERATION OF THE NEED FOR SUBMISSION OF DATA

20/09/2010 468/2010 – 11


HOME LOANS: PRODUCT CODES, SBI SURAKSHIT HOME LOAN : HOME LOAN WITH LIFE COVER

16/09/2010 465/2010 – 11

NBG/PBU/PL-XPRESS/13/2010 – 11

PERSONAL BANKING ADVANCES – XPRESS CREDIT SCHEME – MODIFICATIONS

15/09/2010 462/2010 – 11

CCO/CPPD-CRMD`/51/2010 – 11

CREDIT RISK MANAGEMENT POLICY-REVIEW

15/09/2010 461/2010 – 11


APPLICATION SUPPORTED BY BLOCKED AMOUNT (ASBA) – CHANGE IN BSE SOFTWARE: VERSION 12.90

15/09/2010 460/2010 – 11

NBG/BOD-KCC/41/2010 – 11

OPERATIONAL RISK IN THE BANK KYC/AML/CFT MEASURES REVISED POLICY AND PROCEDURAL GUIDELINES VERIFICATION OF KYC COMPLIANCE IN ACCOUNTS

15/09/2010 459/2010 – 11

NBG/BOD-GB/40/2010 – 11

CONTRIBUTION TO PRIME MINISTER’S NATIONAL RELIEF FUND (PMNRF)

14/09/2010 458/2010 – 11

NBG/BOD-FMC/39/2010 – 11

CHEATING ATTEMPT HOAX TELEPHONE CALLS IN THE NAME OF SENIOR OFFICERS OF THE BANK

14/09/2010 457/2010 – 11

CDO/P&HRD-IR/37/2010 – 11

STAFF : AWARD IMPROVED MEDICAL AID SCHEME HOSPITALISATION SCHEME REIMBURSEMENT OF CHARGES INCURRED BY WORKMEN FOR PATHOLOGICAL TESTS AND INVESTIGATIONS

14/09/2010 456/2010 – 11

NBG/PBU/PL-STUDENT/12/2010 – 11

PERSONAL BANKING ADVANCES – SBI STUDENT LOANS SCHEME – EXTENSION OF MORATORIUM PERIOD- TREATMENT TO RESTRUCTURED ACCOUNTS

14/09/2010 455/2010 – 11


CENMAC ACTION POINTS : SYNERGY BETWEEN BUSINESS UNITS; HOME LOANS : BUILDER TIE-UP OWNERSHIP

14/09/2010 454/2010 – 11


PERSONAL BANKING ADVANCES – SBI STUDENT LOAN SCHEME – TEACHER TRAINING/ NURSING/

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B.ED. COURSES

14/09/2010 452/2010 – 11

NBG/GAD-UMEA/10/2010 – 11

GOVERNMENT BANKING : MINISTRY OF ROAD TRANSPORT AND HIGHWAYS, PAYMENT OF CONSOLIDATED FEE FOR NATIONAL PERMIT, REVISED SYSTEM TO BE INTRODUCED FROM 15.09.2010

13/09/2010 450/2010 – 11

NBG/GAD-SCSS/9/2010 – 11

GOVT.BUSINESS:MISC.DEPOSIT SCHEME,SENIOR CITIZENS SAVINGS SCHEME 2004,CLARIFICATION IN RESPECT OF RATE OF INTEREST IN DEATH CASES

13/09/2010 449/2010 – 11


WESTERN UNION FINANCIAL SERVICES – DATA CAPTURE GUIDELINES UNDER NEW KYC NORMS

09/09/2010 448/2010 – 11

NBG/BOD-GB/38/2010 – 11

NEW SYMBOL FOR INDIAN RUPEE PROPAGATING AND POPULARIZING

09/09/2010 447/2010 – 11

NBG/BOD-GB/37/2010 – 11

CHARGES FOR OUTSTATION CHEQUE COLLECTION SHARING OF SERVICE CHARGES BETWEEN PAYING AND COLLECTING BANKS WHEN TWO BANKS ARE INVOLVED IN COLLECTION

09/09/2010 446/2010 – 11

NBG/BOD-KYC/36/2010 – 11

OPERATIONAL RISK IN THE BANK KNOW YOUR CUSTOMER/ANTI MONEY LAUNDERING/COMBATING OF FINANCING OF TERRORISM (KYC/AML/CFT) MEASURES POLICY AND PROCEDURAL GUIDELINES ACCOUNTS OF PROPRIETORY CONCERNS

09/09/2010 444/2010 – 11


PERSONAL BANKING ADVANCES SBI STUDENT LOAN SCHEME TEACHER TRAINING/ NURSING/ B.ED. COURSES

08/09/2010 443/2010 – 11

NBG/S&P-SP/15/2010 – 11

STAFF SUGGESTION SCHEME (SSS)- NEW PROPOSAL FOR SSS.

07/09/2010 441/2010 – 11


PRE-SANCTION AND POST SANCTION INSPECTIONS

07/09/2010 440/2010 – 11

CS&NB/CS&NB-REMITTANCE/6/2010 – 11

UNIFORMITY IN PENAL INTEREST PAYABLE BY BANKS FOR DELAYS IN CREDIT/ RETURN OF NEFT/ NECS/ ECS TRANSACTIONS

06/09/2010 439/2010 – 11

NBG/S&P-SP/14/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN)REVERSING DEBIT / REVERSING CREDITS OF AGENCY CLEARING DRAFTS TO BE ACCOUNTED IN DRAFTS ACCOUNT AFTER DATA MERGER

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04/09/2010 438/2010 – 11


NEW-PRODUCT FLOATING RATE TERM DEPOSIT (FRTD) WITH INTEREST RATE LINKED TO THE BANK’S BASE RATE

04/09/2010 437/2010 – 11


PERSONAL BANKING – OPENING OF S.B. ACCOUNT – POPULARISING NON PERSONALISED WELCOME KITS (NPWKS) OPERATIONAL INSTRUCTIONS TO BRANCHES

04/09/2010 436/2010 – 11


GOVERNMENT BANKING : UMEA TRANSACTIONS,MINISTRY OF ROAD TRANSPORT AND HIGHWAYS,COLLECTION OF CONSOLIDATED FEE FOR NATIONAL PERMIT : REVISED PROCEDURE W.E.F. 15.09.2010

04/09/2010 435/2010 – 11


RURAL BUSINESS STRATEGY – ALTERNTE CHANNELS –ENGAGEMENT OF BUSINESS FACILITATORS (BFS) – INDIVIDUALS

04/09/2010 434/2010 – 11


RURAL BUSINESS STRATEGY: ENGAGEMENT OF BUSINESS CORRESPONDENTS ( BCS) OBTENTION OF SECURITY DEPOSIT

03/09/2010 433/2010 – 11

CDO/P&HRD-IR/36/2010 – 11

NOTICE OF ALL INDIA STRIKE BY ALL INDIA BANK EMPLOYEES’ ASSOCIATION (AIBEA) ON 7TH SEPTEMBER 2010

03/09/2010 432/2010 – 11

CDO/P&HRD-IR/35/2010 – 11

REVIEW OF PROMOTION POLICY : CLERICAL TO OFFICERS CADRE TRAINEE OFFICER CHANNEL

03/09/2010 430/2010 – 11


ASIAN CLEARING UNOIN (ACU) – SETTLEMENT OF TRASACTIONS- EU REGULATIONS- ACU-EURO TRANSACTIONS RELATING TO IRAN

02/09/2010 425/2010 – 11

CDO/P&HRD-PM/34/2010 – 11

BONUS FOR THE ACCOUNTING YEAR 01/04/2009 TO 31/03/2010

02/09/2010 424/2010 – 11

CDO/P&HRD-IR/33/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN) BY SBI :CURRENCY CHEST AND NON CURRENCY CHEST BRANCHES OF E-SBIN: JOINT CUSTODIAN OF CASH

01/09/2010 420/2010 – 11

CCO/CPPD-CREDIT RATI/46/2010 – 11

PERFORMANCE & CREDIT RATING SCHEME FOR SMALL SCALE INDUSTRIES BY OUTSIDE AGENCIES

01/09/2010 417/2010 – 11

CCO/CPPD-NPA/45/2010 – 11

NPA MANAGEMENT: QUICK MORTALITY ACCOUNTS IN PER SEGMENT

31/08/2010 416/2010 – 11

CDO/P&HRD-PM/32/2010 – 11

(A) REIMBURSEMENT OF OUT OF POCKET EXPENSES TO LIAISON OFFICERS;(B) DISCOMFORT ALLOWANCE FOR LIAISON OFFICERS & SECURITY OFFICERS

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30/08/2010 414/2010 – 11


RECRUITMENT OF SPECIALIST CADRE OFFICERS IN STATE BANK OF INDIA – ADVERTISEMENT NO. CRPD/ SME & STE/2010-11/02

27/08/2010 412/2010 – 11


REVIEW OF HURDLE RATE

26/08/2010 411/2010 – 11

NBG/GAD-GC/7/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN) BY SBI,LEGAL MERGER ON 26-08-2010, DATA MERGER ON 04-09-2010,REPORTING / SETTLEMENT /RECONCILIATION OF CENTRAL GOVERNMENT BUSINESS TRANSACTIONS

26/08/2010 410/2010 – 11

CDO/P&HRD-CM/31/2010 – 11

DEMANT SERVICES AND ON LINE TRADING HONORARIUM TO BE PAID TO OUR BANK STAFF FOR PASSING THE ONLINE EXAMINATION BSE CERTIFICATION ON CENTRAL DEPOSITORY CONDUCTED BY BSE

26/08/2010 408/2010 – 11


PERSONAL BANKING: AUTO LOANS – AUTO LOANS COUNSELORS

25/08/2010 406/2010 – 11


RECRUITMENT OF SPECIALIST OFFICERS IN ASSOCIATE BANKS OF STATE BANK OF INDIA ADVERTISEMENT NO. CRPD/ SCO/ 2010-11/ 03

25/08/2010 404/2010 – 11

NBG/PBU/LIMA-TD/22/2010 – 11

MASTER CIRCULAR – TERM DEPOSITS

25/08/2010 403/2010 – 11

NBG/S&P-SP/13/2010 – 11

PRINTING OF NAME OF NOMINEE BY THE SYSTEM IN PASSBOOKS/TDR-STDR ADVICES/STATEMENT OF ACCOUNTS

25/08/2010 402/2010 – 11


CORPORATE AND INSTITUTIONAL TIE-UPS – CORPORATE SALARY PACKAGE (CSP), DEFENCE SALARY PACKAGE (DSP) – FINANCIAL PLANNING AND ADVISORY SERVICES INCLUSION IN CSP/DSP

25/08/2010 401/2010 – 11

CS&NB/CS&NB-E/5/2010 – 11

DEPOSITORY PARTICIPANT & ONLINE TRADING BUSINESS – DP CENTRALIZED PROCESSING CELL (DPCPC) – UPDATED OPERATING GUIDELINES FOR BRANCHES

25/08/2010 400/2010 – 11

NBG/S&P-SP/12/2010 – 11

AFFIXING OF CHECK SIGNAL BY ERSTWHILE STATE BANK OF INDORE (SBIN) BRANCHES AFTER MERGER WITH STATE BANK OF INDIA (SBI)

24/08/2010 399/2010 – 11

NBG/PBU/LIMA-FORMS/21/2010 – 11

BPR PROJECT :LIABILITY CPC – RETURN OF DISCREPANT ACCOUNT OPENING FORMS TO BRANCHES

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23/08/2010 388/2010 – 11


PERSONAL BANKING: CAR LOANS – CAR-A-BRANCH CAMPAIGN

23/08/2010 387/2010 – 11

NBG/GAD-REV/6/2010 – 11

GOVERNMENT BUSINESS : CBEC, DATA QUALITY IN ELECTRONIC ACCOUNTING SYSTEM IN CENTRAL EXCISE AND SERVICE TAX (EASIEST) – ASSESSEE CODE MANDATORY FOR EXCISE AND SERVICE TAX PAYMENTS

23/08/2010 386/2010 – 11

IBG/FD/FD-FCL/49/2010 – 11

EXTERNAL COMMERCIAL BORROWINGS (ECB) POLICY – LIBERALISATION

23/08/2010 384/2010 – 11

IBG/FD/FD-RENOSA/48/2010 – 11

CORRESPONDENT RELATIONS – OPENING OF NOSTRO ACCOUNTS IN CAD, AUD & JPY FOR FOREIGN TRAVEL CARD (FTC) TRANSACTIONS

23/08/2010 383/2010 – 11

NBG/SMEBU-SMECFL/41/2010 – 11

SME COLLATERAL FREE LOANS (SMECFL)–NEW PRODUCT CODES

23/08/2010 382/2010 – 11

NBG/S&P-SP/11/2010 – 11

ACQUISITION OF STATE BANK OF INDORE-PAYMENT OF FRACTIONAL PAYMENT WARRANTS “AT PAR” AT ALL BRANCHES

23/08/2010 381/2010 – 11


FINANCIAL INCLUSION: CELL PHONE MESSAGING CHANNEL ON EKO PLATFORM – INDIVIDUAL BCS – COORDINATION DOCUMENT

23/08/2010 380/2010 – 11

NBG/S&P-DRAFTS/10/2010 – 11

INTER BRANCH RECONCILIATION: DRAFTS ACCOUNT,OUTSTANDING ENTRIES ORIGINATED DURING THE PERIOD- APRIL 1999 TO MARCH 2004

23/08/2010 379/2010 – 11


FINANCIAL INCLUSION ACCOUNTS – SBI TINY REMITTANCE – SERVICE CHARGES

23/08/2010 378/2010 – 11


PBBU: HOME LOANS ‘SBI HOME LOAN PAL (PRE-APPROVED LIMIT)

23/08/2010 377/2010 – 11


PBBU: HOME LOANS “SBI SURAKSHIT HOME LOAN” HOME LOAN WITH LIFE COVER

21/08/2010 376/2010 – 11

IBG/FD/FD-FCN/47/2010 – 11

LIFTING OF SURPLUS FOREIGN CURRENCY NOTES (FCN) FROM OUR BRANCHES ACROSS THE COUNTRY – REVIEW OF ARRANGEMENT WITH THOMAS COOK (I) LTD.(TCIL) WITH EFFECT FROM 01.09.2010

21/08/2010 375/2010 – 11

IBG/FD/FD-FCL/46/2010 – 11

BUY-BACK/ PRE-PAYMENT OF FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBS)

21/08/2010 374/2010 – 11


ESTABLISHMENT OF BRANCH OFFICES (BO) / LIAISON OFFICES (LO) IN INDIA BY FOREIGN ENTITIES – DELEGATION OF POWERS

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21/08/2010 373/2010 – 11

NBG/PBU/PL-SCHOLAR/8/2010 – 11

PERSONAL BANKING ADVANCES – SBI SCHOLAR LOAN SCHEME – IDENTIFICATION OF DESIGNATED BRANCHES

20/08/2010 368/2010 – 11


RECRUITMENT OF SPECIALIST CADRE OFFICERS IN STATE BANK OF INDIA – ADVERTISEMENT NO. CRPD/ SCO/-SBI/2010-11/01

20/08/2010 367/2010 – 11

IBG/FD/FD-RENOSA/44/2010 – 11

CORRESPONDENT RELATIONS – OPENING OF NOSTRO ACCOUNTS IN US DOLLAR (USD) WITH PT. BANK SBI INDONESIA

20/08/2010 366/2010 – 11

NBG/BOD-KYC/35/2010 – 11

OPERATIONAL RISK IN BANK KNOW YOUR CUSTOMER/ANTI MONEY LAUNDERING/COMBATING OF FINANCING OF TERRORISM (KYC/AML/CFT) MEASURES REVISED POLICY AND PROCEDURAL GUIDELINES HIGH RISK COUNTRIES

20/08/2010 365/2010 – 11


PERSONAL BANKING: CORPORATE SALARY PACKAGE (CSP) – CONCESSIONS ON P-SEGMENT LOANS TO PERMANENT EMPLOYEES OF RELIANCE COMMUNICATIONS LTD. AND THEIR GROUP COMPANIES

18/08/2010 361/2010 – 11

CDO/P&HRD-PM/28/2010 – 11

SBI RETIRED EMPLOYEES’ MEDICAL BENEFIT SCHEME (REMBS) REVISION IN THE SCHEME

18/08/2010 360/2010 – 11

CCO/CPPD-COLLATERAL/42/2010 – 11

LOANS SANCTIONED TO MICRO & SMALL ENTERPRISES: COLLATERAL SECURITY NORMS

18/08/2010 359/2010 – 11

NBG/ABU/PDM-AGMARKET/9/2010 – 11

PRODUCER COMPANIES-EMERGING AREA IN AGRI BUSINESS

17/08/2010 358/2010 – 11

CDO/P&HRD-PM/27/2010 – 11

STAFF: MISCELLANEOUS : PAYMENT OF GRATUITY : INCREASE OF CEILING

17/08/2010 355/2010 – 11

NBG/S&P-DRAFTS/9/2010 – 11

ACQUISITION OF STATE BANK OF INDORE (SBIN)

17/08/2010 352/2010 – 11

NBG/BOD-FMC/34/2010 – 11

FRAUD : CAR LOANS

17/08/2010 351/2010 – 11

NBG/PBU/OPS-NPA/1/2010 – 11

CONTACT UPDATION ON LOAN PROFILE – CAMPAIGN: OPERATION SAMPARK

16/08/2010 350/2010 – 11


HOME LOANS: ACCOUNT OPENING AT RACPC

16/08/2010 349/2010 – 11


NEW-PRODUCT – FLOATING RATE TERM DEPOSIT (FRTD) WITH INTEREST RATE LINKED TO THE

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BANK’S BASE RATE

16/08/2010 347/2010 – 11

NBG/PBU/LIMA-DTD/18/2010 – 11

PERSONAL BANKING – TERM DEPOSIT FOR 555 DAYS (SBI 555) – TERM DEPOSIT FOR 1000 DAYS (SBI 1000)

14/08/2010 344/2010 – 11

NBG/S&P-SP/8/2010 – 11

INOPERATIVE ACCOUNTS IN BANKS. SAVINGS & CURRENT ACCOUNT.

13/08/2010 332/2010 – 11

NBG/AGNYBKG-RBI/1/2010 – 11

COMPLIANCE OF RBI INSTRUCTIONS REGARDING DETECTION AND IMPOUNDING OF COUNTERFEIT NOTES

13/08/2010 331/2010 – 11

NBG/S&P-SP/7/2010 – 11

CHEQUE TRUNCATION SYSTEM: STANDARDIZATION AND ENHANCEMENT OF SECURITY FEATURES IN CHEQUE FORMS

13/08/2010 330/2010 – 11

CDO/ORG-DFP/1/2010 – 11

CONTROL OF OVERHEADS LINKING THE DELEGATION OF FINANCIAL POWERS TO BUDGETS SETTLED

13/08/2010 329/2010 – 11


GOVERNMENT BUSINESS : UMEA, COLLECTION OF UNION PUBLIC SERVICE COMMISSION (UPSC), ONLINE RECRUITMENT APPLICATION (ORA) FEES THROUGH VARIOUS MODES

12/08/2010 328/2010 – 11


AGRI ADVANCES-RELAXATION OF SECURITY/MARGIN FOR LOANS UPTO RS1 LAKH- FURTHER CLARIFICATIONS

11/08/2010 327/2010 – 11


MASTER CIRCULAR – SAVINGS BANK ACCOUNT

09/08/2010 326/2010 – 11

NBG/SMEBU-MSME CREDI/40/2010 – 11

IMPLEMETATION OF THE RECOMMENDATIONS OF THE PRIME MINISTER’S HIGH LEVEL TASK FORCE ON MSMES

09/08/2010 323/2010 – 11


RENT PLUS SCHEME: MODIFICATIONS IN THE SCHEME

09/08/2010 322/2010 – 11


VISHWA YATRA FOREIGN TRAVEL CARD (FTC) – REVIEW OF FOREIGN CURRENCY CONVERSION RATE

06/08/2010 316/2010 – 11


CSP AND DSP DISCOUNT OF 1% ON PURCHASE OF GOLD COINS

06/08/2010 315/2010 – 11


CSP TIE-UPS : COAL INDIA LIMITED – CONCESSION IN DEMAT CHARGES

05/08/2010 310/2010 – 11


FINANCING OF FAMILY TYPE BIO GAS PLANTS

05/08/2010 309/2010 IBG/FD/FD- ASIAN CLEARING UNION (ACU) – SETTLEMENT OF

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– 11 MISC/42/2010 – 11 TRANSACTIONS – EU REGULATIONS – ACU EURO TRANSACTIONS RELATING TO IRAN

05/08/2010 308/2010 – 11


PERSONAL BANKING ADVANCES EDUCATION LOANS

04/08/2010 307/2010 – 11


HOME LOAN COUNSELORS (HLCS) REMUNERATION

04/08/2010 306/2010 – 11

IBG/FD/FD-CRBE/41/2010 – 11

NEGOTIATION OF BILLS & CONFIRMATION OF LCS – PAKISTAN RISK CATEGORY – OFF CREDIT/RESTRICTED AND UNDER CAUTION

03/08/2010 305/2010 – 11


BANK’S EXPOSURE TO CAPITAL MARKETS-LOANS EXTENDED BY BANKS TO MUTUAL FUNDS AND ISSUE OF IRREVOCABLE PAYMENT COMMITMENTS (IPCS)

03/08/2010 304/2010 – 11


AUTHORITY STRUCTURE FOR APPROVAL OF ALLOCATION OF LIMIT TO OTHER BRANCHES

02/08/2010 303/2010 – 11

NBG/BOD-FMC/31/2010 – 11

SCHEME FOR RECOGNITION AND REWARDS OF ALERTNESS IN STAFF MEMBRS IN PREVENTION/DETECTION/FOILING OF FRAUDS “THE ALERTNESS AWARD”

02/08/2010 302/2010 – 11

NBG/S&P-DRAFT/6/2010 – 11

LOSS OF BLANK DRAFT/IOI FORMS REPORTING SYSTEM

31/07/2010 301/2010 – 11

CCO/CPPD-OTS/38/2010 – 11

COMPROMISE/NEGOTIATED / ONE TIME SETTLEMENT OF NON-PERFORMING ASSETS

31/07/2010 298/2010 – 11


NEW PRODUCT: SPECIAL PACKAGE FOR INSURANCE COMMISSION AGENTS (SPICA)

31/07/2010 297/2010 – 11


EXTENSION OF MISSION CYBER POWER

31/07/2010 296/2010 – 11

CDO/P&HRD-IR/23/2010 – 11

PAYMENT OF SALARY AND ALLOWANCES TO E-SBS OFFICERS/EMPLOYEES SPECIAL COMPENSATORY ALLOWANCE (SCA)

31/07/2010 290/2010 – 11


MASTER CIRCULAR – E-INVEST (ASBA)

30/07/2010 289/2010 – 11

CDO/P&HRD-PM/22/2010 – 11

STAFF: SUPERVISING : PROVISION OF FURNITURE AND FIXTURE AT THE TIME OF RETIREMENT : MODIFICATION

29/07/2010 288/2010 – 11

IBG/FD/FD-FCL/40/2010 – 11

EXTERNAL COMMERCIAL BORROWINGS (ECB) POLICY – TAKE-OUT FINANCE

29/07/2010 286/2010 – 11


PERSONAL BANKING – NEW PRODUCT : TERM DEPOSITS FOR 18 YEARS FOR THE BENEFIT OF

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GIRL CHILD – PRODUCT CODE : 2511-1801

29/07/2010 285/2010 – 11


WESTERN UNION FINANCIAL SERVICES (WU) – OBSERVANCE OF KYC/AML: PRIVACY OF CONSUMER DATA

29/07/2010 284/2010 – 11


BANK GUARANTEES: PROPER CLASSIFICATION

29/07/2010 281/2010 – 11


DEFERRED PAYMENT PROTOCOLS DATED APRIL30, 1981 AND DECEMBER 23, 1985 BETWEEN GOVERNMENT OF INDIA AND ERSTWHILE USSR

29/07/2010 280/2010 – 11


EXPORT OF GOODS AND SERVICES – UNREALISED EXPORT BILLS – WRITE OFF – SURRENDER OF EXPORT INCENTIVES

28/07/2010 279/2010 – 11

CCO/CPPD-CDR/35/2010 – 11

CORPORATE DEBT RESTRUCTURING REVISION IN GUIDELINES RELATING TO ADDITIONAL FINANCE

28/07/2010 278/2010 – 11

NBG/BOD-GB/30/2010 – 11

FICTITIOUS OFFERS OF CHEAP FUNDS FROM ABROAD – AWARENESS CAMPAIGN

27/07/2010 277/2010 – 11


CORE BANKING SOLUTIONS: DEPOSIT ACCOUNTS – RECOVERY OF CHARGES FOR NON MAINTENANCE OF MINIMUM BALANCE- REVISED PROCEDURE

27/07/2010 275/2010 – 11


LOAN STATEMENT TO BORROWERS

23/07/2010 266/2010 – 11


XPRESS CREDIT FOR DSP ACCOUNT HOLDERS

23/07/2010 265/2010 – 11

IT/GLOBALIT-ITSS/9/2010 – 11

GUIDELINES FOR REPLACEMENT OF STANDARD AND NON-CRITICAL HARDWARE

23/07/2010 264/2010 – 11


RECRUITMENT OF SPECIALIST CADRE OFFICERS IN STATE BANK F INDIA – ADVERTISEMENT NO. CRPD/ SME & STE/2010-11/02

22/07/2010 263/2010 – 11


CORPORATE DEBT RESTRUCTURING: HOLDING ON OPERATIONS (HOO)

22/07/2010 261/2010 – 11

CDO/P&HRD-IR/21/2010 – 11

STAFF SUPERVISING/AWARD STAFF CLARIFICATION IN RESPECT OF REIMBURSEMENT OF CONVEYANCE EXPENSES

22/07/2010 260/2010 – 11

NBG/PBU/MCS-GENERAL/1/2010 – 11

CROSS SELLING : SBI CARDS – CASH ACCEPTANCE FACILITY FOR SBI CARDHOLDERS AT SBI BRANCHES

21/07/2010 258/2010 IBG/FD/FD- CORRIGENDUM – RUPEE VOSTRO ACCOUNTS –

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– 11 NRRAVOS/36/2010 – 11 EXCHANGE HOUSES – DESIGNATED DEPOSITORY AGENCY ARRANGEMENT – DEMAND DRAFTS ISSUED BY EXCHANGE HOUSES WITH INSTRUMENT REFERENCE NUMBER IN EXCESS OF SIX DIGITS

21/07/2010 256/2010 – 11


APPLICATION SUPPORTED BY BLOCKED AMOUNT (ASBA) – AVAILABLITY OF APPLICATION FORMS: ASBA E-FORMS

21/07/2010 255/2010 – 11


APPLICATION SUPPORTED BY BLOCKED AMOUNT (ASBA) – CHANGE OF ADDRESS OF NODAL BRANCH

20/07/2010 254/2010 – 11

NBG/ABU/BP-NPA/8/2010 – 11

IRAC NORMS AND INCORPORATION OF ‘NPA HOLIDAY PERIOD’

20/07/2010 252/2010 – 11


NEW BGL ACCOUNT NO. TO IMPLEMENT THE NEW ACCOUNTING PROCEDURE FOR ADDITIONAL INTEREST SUBVENTION

20/07/2010 251/2010 – 11


DSP : NAVY

19/07/2010 250/2010 – 11


PENAL INTEREST POLICY

17/07/2010 248/2010 – 11


RELAXATION OF SECURITY / MARGIN FOR LOANS UPTO RS 1 LAC

17/07/2010 247/2010 – 11

NBG/SMEBU-LIP/34/2010 – 11

AIEEE-2010-CENTRAL COUNCILLING BOARD – ACCEPTANCE OF DRAFTS FOR ADMISSIONS FEES

17/07/2010 246/2010 – 11

NBG/ABU/PDM-ABP/4/2010 – 11

AGRI BUSINESS: PISCICULTURE – NATIONAL FISHERIES DEVELOPMENT BOARD (NFDB) – SUBSIDY FOR FISHERIES DEVELOPMENT.

17/07/2010 245/2010 – 11

NBG/SMEBU-POWER CA/33/2010 – 11

NEW CURRENT ACCOUNT PACKAGES – SME POWER CURRENT ACCOUNTS

16/07/2010 244/2010 – 11

CDO/P&HRD-PM/20/2010 – 11

STAFF : SUPERVISING : PROVISION OF FURNITURE AND FIXTURE : CLARIFICATIONS

15/07/2010 242/2010 – 11


PERSONAL BANKING : CORPORATE AND INSTITUTIONAL TIE-UPS CORPORATE SALARY PACKAGE (CSP) REVIEW OF WAIVERS: OFFER OF FREE EZTRADE ACCOUNTS

15/07/2010 240/2010 – 11


PERSONAL BANKING BUSINESS UNIT CORPORATE AND INSTITUTIONAL TIE-UPS NEW PRODUCT: PARA MILITARY SALARY PACKAGE – PMSP OPENING OF ACCOUNTS: CUSTOMER TYPE – 010211

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14/07/2010 238/2010 – 11


CORRESPONDENT RELATIONS – CANCELLATION OF AGENCY ARRANGEMENT

12/07/2010 237/2010 – 11


MASTER CIRCULAR CAR LOAN

12/07/2010 236/2010 – 11


PERSONAL BANKING ADVANCES – IBA MODEL EDUCATION LOAN SCHEME – DERECOGNISED DEEMED UNIVERSITIES

12/07/2010 235/2010 – 11


INTEREST SUBSIDY SCHEME ON EDUCATION LOAN FOR ECONOMICALLY WEAKER SECTION PROPOSED BY MINISTRY OF HRD, GOVT. OF INDIA

10/07/2010 234/2010 – 11

NBG/S&P-SP/5/2010 – 11

OVERHEAD EXPENSES – CHARGES MISCELLANEOUS

09/07/2010 233/2010 – 11


FINANCIAL INCLUSION BY EXTENSION OF BANKING SERVICES USE OF BUSINESS CORRESPONDENTS (BCS) ENGAGEMENT OF ADDITIONAL INDIVIDUALS

09/07/2010 231/2010 – 11

NBG/ABU/PDM-AC AND A/3/2010 – 11

CENTRAL SECTOR SCHEME ESTABLISHING AGRICLINIC AND AGRI BUSINESS CENTRES SCHEME

09/07/2010 230/2010 – 11

NBG/BOD-KYC/29/2010 – 11

KYC/AML/CFT MEASURES KYC COMPLIANCE AND FRAUD PREVENTION DAY, 1ST AUGUST, 2010 OBSERVATIONS

09/07/2010 229/2010 – 11


EXPORT OF GOODS AND SOFTWARE – REALISATION AND REPATRIATION OF EXPORT PROCEEDS – LIBERALISATION

09/07/2010 228/2010 – 11

NBG/GAD-REV/4/2010 – 11

GOVERNMENT BUSINESS : NEW PRODUCT “E-TAX FOR NABS” – ONLINE PAYMENT OF STATUTORY DUES BY NON-AGENCY BANKS (NABS) FOR THEIR CUSTOMERS USING SBI-CINB FACILTY

08/07/2010 226/2010 – 11

NBG/S&P-SP/4/2010 – 11

OBTENTION OF CONSENT FOR DISCLOSURE OF NAME OF NOMINEE IN PASSBOOK/TDR/STDR ETC.

07/07/2010 225/2010 – 11

CCO/CPPD-TUFS/30/2010 – 11

TECHNOLOGY UPGRADATION FUND SCHEME

07/07/2010 224/2010 – 11


FOREIGN EXCHANGE MANAGEMENT ACT, 1999 (FEMA) – FOREIGN EXCHANGE (COMPOUNDING PROCEEDINGS) RULES, 2000 (THE RULES) –

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COMPOUNDING OF CONTRAVENTIONS UNDER FEMA, 1999

07/07/2010 223/2010 – 11

CDO/RTI-RTI/1/2010 – 11

RIGHT TO INFORMATION ACT, 2005 PAYMENT OF REQUISITE RTI FEE IN CASH AT BRANCHES

06/07/2010 221/2010 – 11


BANK’S EXPOSURE TO CAPITAL MARKETS-LOANS EXTENDEDBY BANKS TO MUTUAL FUNDS AND ISSUE OF IRREVOCABLE PAYMENT COMMITMENTS (IPCS)

06/07/2010 220/2010 – 11

CCO/CPPD-SAM/28/2010 – 11

STRESSED ASSETS MANAGEMENT: RESOLUTION AGENTS: NEW SCHEME

06/07/2010 219/2010 – 11

CCO/CPPD-BANK GUARAN/27/2010 – 11

ADVANCES-BANK GUARANTEES PROPER CLASSIFICATION

06/07/2010 218/2010 – 11

CCO/CPPD-FRAUD/26/2010 – 11

GUIDELINES FOR ESTABLISHING PROCEDURE FOR CREATING DATABASE REPORTING THE NAMES OF PROFESSIONAL/THIRD PARTY ENTITIES (TPES) INVOLVED IN FRAUDS TO IBA

05/07/2010 217/2010 – 11


HOME LOANS- NATIONAL BUILDERS TIE-UPS–UPDATING OF BUILDERS TIE UP – HTTP://10.1.1.13/BPTU

05/07/2010 216/2010 - 11

NBG/PBU/AL-AUTOLOAN/6/2010 - 11

PERSONAL BANKING: AUTO LOANS: MIGRATION TO BASE RATE SYSTEM W.E.F. 1ST JULY, 2010.

03/07/2010 211/2010 – 11

CAG/CMP-DW/3/2010 – 11

DIVIDEND PAYMENT-SBI FINAL DIVIDEND

03/07/2010 210/2010 – 11


CORRESPONDENT RELATIONS IN UNITED ARAB EMIRATES (U.A.E) – EMIRATES NBD BANK PJC – AMENDMENT OF SWIFT BIC- NBDUAEAD TO EBILAEAD

01/07/2010 209/2010 – 11


MASTER CIRCULAR – HOME LOANS

01/07/2010 208/2010 – 11

CCO/CPPD-BASE RATE/25/2010 – 11

BASE RATE IMPLEMENTATION INTEREST RATE STRUCTURE SEGMENT C & I, SIB AND AGRI

01/07/2010 207/2010 – 11


PERSONAL BANKING ADVANCES – OTHER PERSONAL LOANS – MIGRATION TO BASE RATE SYSTEM WITH EFFECT FROM 1ST JULY 2010

01/07/2010 204/2010 – 11

CDO/P&HRD-PPFG/19/2010 – 11

SBI EMPLOYEES’ GRATUITY FUND MASTER POLICY UNDER CAPASSURE GRATUITY SCHEME OF SBI LIFE INSURANCE CO. LTD

01/07/2010 201/2010 – 11


PERSONAL BANKING : AUTO LOANS (i) SBI Ezee Car Loan (July 2010) (ii) SBI Advantage Car Loan (July 2010)

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01/07/2010 200/2010 – 11


IMPLEMENTATION OF CREDIT SCORING MODELS FOR PERSONAL BANKING SEGMENT ADVANCES

01/07/2010 199/2010 – 11

CFO/A&C-TDS/2/2010 – 11

TDS CHANGES

30/06/2010 197/2010 – 11


HOME LOANS:MIGRATION TO BASE RATE SYSTEM W.E.F 01.07.2010

30/06/2010 196/2010 – 11


PBBU:HOME LOANS (I) SBI EASY HOME LOAN (JULY 2010) (II) SBI ADVANTAGE HOME LOAN JULY 2010

30/06/2010 195/2010 – 11

IT/GLOBALIT-COREBKG/8/2010 – 11

ISSUANCE OF LCS/BGS DENOMINATED IN FOREIGN CURRENCIES – MULTI-CURRENCY ACCOUNTING

30/06/2010 194/2010 – 11


OPENING OF S.B. ACCOUNTS POPULARISING NON PERSONALISED WELCOME KITS

30/06/2010 191/2010 – 11

CDO/P&HRD-MISC/18/2010 – 11

STAFF – MISCELLANEOUS FINANCIAL ADVISORY FOR INVESTMENT OF WAGE ARREARS

29/06/2010 190/2010 – 11

NBG/BOD-KYC/27/2010 – 11

KYC/AML/CFT POLICY AND PROCEDURAL GUIDELINES IMPLEMENTATION

29/06/2010 189/2010 – 11


IMPLEMENTATION OF BASE RATE IN CBS

26/06/2010 186/2010 – 11


BASE RATE IMPLEMENTATION DOCUMENTATION FOR NEW ACCOUNTS AGRI SET OF DOCUMENTS

26/06/2010 185/2010 – 11


HOME LOANS : MODIFICATIONS, I) EMI/NMI RATIO, (II) MARGIN, (III) CIBIL CREDIT ETC.

26/06/2010 184/2010 – 11


BASE RATE IMPLEMENTATION DOCUMENTATION FOR NEW ACCOUNTS SME SET OF DOCUMENTS

26/06/2010 183/2010 – 11


BASE RATE IMPLEMENTATION DOCUMENTATION FOR NEW ACCOUNTS SEGMENTS: C& I

26/06/2010 182/2010 – 11


PERSONAL BANKING SEGMENT: SERVICE CHARGES REVISION MANUAL APPLICATION

24/06/2010 181/2010 – 11

NBG/PBU/LIMA-SDL/7/2010 – 11

SAFE DEPOSIT LOCKERS (SDLS) CAMPAIGN FOR BREAKING OPEN LOCKERS

24/06/2010 180/2010 – 11

CDO/P&HRD-PM/17/2010 – 11

STAFF SUPERVISING : FACILITY OF LEASED ACCOMMODATION AT A PLACE OF CHOICE FOR OFFICERS SCALE VI & VII

24/06/2010 179/2010 – 11

RABG/RBNFMCFI-SHGS/1/2010 – 11

SELF HELP GROUPS SEGMENT CLASSIFICATION

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23/06/2010 178/2010 – 11

CDO/P&HRD-IR/16/2010 – 11

WORKMEN STAFF – SALARY REVISION 9TH BIPARTITE SETTLEMENT

23/06/2010 174/2010 – 11

IBG/FD/FD-SALES/OR/27/2010 – 11

OUTWARD REMITTANCES – ISSUE OF DRAFTS ON OUR LONDON OFFICE BY BRANCHES IN INDIA – NEW SECURITY FORMS

23/06/2010 173/2010 – 11


FOREIGN CURRENCY TRAVELLERS CHEQUES (FCTCS) – SALE OF AMERICAN EXPRESS BANK (AEB) TRAVELLERS CHEQUES – SETTLEMENT INSTRUCTIONS

23/06/2010 172/2010 – 11


ACCEPTING DUPLICATE PIN REQUESTS FROM BRANCHES THROUGH CMS

22/06/2010 169/2010 – 11

CS&NB/NB-PREPAID INSTR/1/2010 – 11

RUPEE PREPAID CARDS – GIFT CARDS WAIVER OF ISSUANCE FEE TILL 31ST MARCH, 2011

22/06/2010 167/2010 – 11

CAG/CMP-MISC/1/2010 – 11

ISSUANCE OF BULK DEMAND DRAFTS-CASH MANAGEMENT PRODUCT

22/06/2010 166/2010 – 11


RECONCILIATION OF ATM CORE TRANSACTIONS ACCOUNT (98549) WITH ADMIN BALANCE / PHYSICAL CASH

19/06/2010 165/2010 – 11


CHECKLIST FOR KIOSK BANKING CHANNEL

18/06/2010 164/2010 – 11


WESTERN UNION FINANCIAL SERVICES (WU): KNOW YOUR CUSTOMER (KYC)/ ANTI-MONEY LAUNDERING (AML)/ COMBATING OF FINANCING OF TERRORISM (CFT)/ OBLIGATION OF AUTHORISED PERSONS

18/06/2010 163/2010 – 11

NBG/PBU/LIMA-DTD/5/2010 – 11

SUGGESTION OF THE HON’BLE HIGH COURT OF DELHI FOR FORMULATION OF A SPECIAL SCHEME BY BANKS FOR KEEPING THE COMPENSATION MONEY IN FIXED DEPOSIT FOR PROTECTING THE INTEREST OF THE ROAD ACCIDENT VICTIMS

17/06/2010 161/2010 – 11

CDO/P&HRD-PM/15/2010 – 11

GRANT OF HINDI INCENTIVES TO BANK EMPLOYEES FOR PROGRESSIVE USE OF HINDI IN BANKS – REVISION IN RATES

17/06/2010 160/2010 – 11


OVERSEAS DIRECT INVESTMENT – ON-LINE REPORTING OF OVERSEAS DIRECT INVESTMENT (ODI)

17/06/2010 159/2010 – 11

NBG/S&P-SP/3/2010 – 11

DISCONTINUE ISSUANCE OF CIRCULARS IN HARD COPIES

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17/06/2010 158/2010 – 11

NBG/S&P-SP/2/2010 – 11

BPR PROJECT –CLEARING CPC-PARKING ACCOUNT AT LINK BRANCH

14/06/2010 154/2010 – 11

CDO/P&HRD-IR/14/2010 – 11

STAFF AWARD CAREER PROGRESSION SCHEME

14/06/2010 153/2010 – 11

CDO/P&HRD-PM/13/2010 – 11

PERMANENT FULL TIME/PART TIME MEDICAL OFFICERS : UNIFORM TERMS & CONDITIONS OF SERVICE (UTCS) : CLARIFICATION

14/06/2010 152/2010 – 11


BASE RATE- INTRODUCTION OF NEW LENDING RATE SYSTEM

14/06/2010 151/2010 – 11


HOME LOAN CAMPAIGN 2010-11 : ‘OPERATION EXCEL’

14/06/2010 150/2010 – 11


INTEREST SUBSIDY SCHEME FOR HOUSING THE URBAN POOR (ISHUP) ,(I) INCOME CEILINGS IN RESPECT OF EWS/LIG (II) BUDGET ALLOCATION

14/06/2010 149/2010 – 11


PRUDENTIAL CREDIT EXPOSURE LIMITS BY BANKS

12/06/2010 148/2010 – 11

NBG/PBU/LIMA-FLEXI/4/2010 – 11

PERSONAL BANKING SBI FLEXI DEPOSIT SCHEME

10/06/2010 142/2010 – 11

IBG/FD/FD-FCD/23/2010 – 11

EXIM BILLS: FOREIGN CURRENCY (FC) PORTFOLIO – ALIGNMENT WITH BALANCES IN CBS

10/06/2010 141/2010 – 11

NBG/BOD-GB/19/2010 – 11

STATE BANK OF INDIA COMPENSATION POLICY – 2010 (BANKING SERVICES) REVIEW

08/06/2010 139/2010 – 11

CDO/P&HRD-IR/12/2010 – 11

SALARY REVISION OFFICERS IN TOP EXECUTIVE GRADE SPECIAL SCALE I & II

08/06/2010 138/2010 – 11

CDO/P&HRD-IR/11/2010 – 11

STAFF : SUPERVISING SALARY REVISION

08/06/2010 136/2010 – 11


ENGAGEMENT OF BUSINESS CORRESPONDENTS (BCS)/BUSINESS FACILITATORS ( BFS) INCLUSION OF EXCLUSIVITY CLAUSE IN BC/BF AGREEMENT

07/06/2010 134/2010 – 11

CDO/P&HRD-PM/10/2010 – 11

STAFF : SUPERVISING : PROVISION OF FURNITURE AND FIXTURE : CLARIFICATIONS

07/06/2010 133/2010 – 11

CCO/CPPD-CIBIL/15/2010 – 11

CIBIL REPORT – UPDATING OF DATA SETTLEMENT BY BANKING OMBUDSMEN SCHEME 2006

07/06/2010 132/2010 – 11

CCO/CPPD-COM PAPER/14/2010 – 11

REPORTING OF COMMERCIAL PAPER ISSUANCE

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07/06/2010 131/2010 – 11


FORWARD CONTRACT AND DERIVATIVES OPERATIONAL GUIDELINES

05/06/2010 128/2010 – 11


VISHWA YATRA FOREIGN TRAVEL CARD (FTC) REVISION IN SERVICE CHARGES

04/06/2010 127/2010 – 11


RECRUITMENT OF SPECIALIST CADRE OFFICERS IN STATE BANK OF INDIA ADVERTISEMENT NO. CRPD/ SCO/-SBI2010-11/01

04/06/2010 126/2010 – 11


INWARD REMITTANCE – REMITTANCE TOWARDS PARTICIPATION IN LOTTERY, MONEY CIRCULATION SCHEMES, OTHER FICTITIOUS OFFERS OF CHEAP FUNDS, ETC.

01/06/2010 124/2010 – 11

CDO/P&HRD-PM/9/2010 – 11

SBI EMPLOYEES’ PENSION FUND RULES : AMENDMENT OF RULE 19 (1)

29/05/2010 123/2010 – 11


PERSONAL BANKING ADVANCES EDUCATION LOAN LOAN MODULE IN CBS: ADDITION IN SOFTWARE

29/05/2010 122/2010 – 11

NBG/S&P-SP/1/2010 – 11

INTER OFFICE INSTRUMENTS: MARKING IOI AS ‘DAMAGED’ IN CBS

28/05/2010 119/2010 – 11


GLOBAL MARKETS CIRCULARS – 2009-10, - SUBJECT-WISE INDEX

26/05/2010 118/2010 – 11


PERSONAL BANKING: CAR LOAN LIABILITIES IN CIBIL REPORTS DISCRETION TO SANCTIONING AUTHORITY

25/05/2010 114/2010 – 11

NBG/BOD-FMC/15/2010 – 11

OPERATIONAL RISK IN BANKS UNAUTHORISED CASH/TRANSFER DEBITS IN SAVINGS BANK ACCOUNT AND UNAUTHORISED PREMATURE PAYMENT OF STDR ACCOUNT

25/05/2010 113/2010 – 11

NBG/BOD-GB/14/2010 – 11

LEVY OF INTEREST ON CLEARING RELATED OVERDRAFT EXTENDED BY CLEARING HOUSE MANAGING BANKS FOR SETTLING CLEARING OBLIGATIONS OF MEMBER BANKS

22/05/2010 111/2010 – 11

NBG/ABU/PDM-DAIRY FI/1/2010 – 11

DAIRY AND POULTTRY VENTURE CAPITAL FUNDS-CONTINUATION FOR THE YEAR 2010-11

22/05/2010 110/2010 – 11

IBG/FD/FD-FCN/17/2010 – 11

U.S.GOVT. UNVEILS NEW DESIGN FOR THE $100 NOTE

21/05/2010 108/2010 – 11


FOREIGN DIRECT INVESTMENT (FDI) IN INDIA – TRANSFER OF SHARES/ PREFERENCE SHARES/ CONVERTIBLE DEBENTURES BY WAY OF SALE – REVISED PRICING GUIDELINES

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20/05/2010 107/2010 – 11

NBG/SMEBU-COLL FREE/18/2010 – 11

SME- COLLATERAL FREE LOAN SCHEME(SMECFL) –MODIFICATION IN THE SCHEME

19/05/2010 106/2010 – 11

IBG/FD/FD-FCL/15/2010 – 11

EXTERNAL COMMERCIAL BORROWINGS (ECB) POLICY

19/05/2010 105/2010 – 11


FOREIGN EXCHANGE MANAGEMENT ACT (FEMA), 1999 – CURRENT ACCOUNT TRANSACTIONS – LIBERALISATION

19/05/2010 104/2010 – 11

CFO/BSMG-INTRATES/1/2010 – 11

BASE RATE INTRODUCTION OF NEW LENDING RATE SYSTEM

19/05/2010 103/2010 – 11

NBG/SMEBU-CBWRF/17/2010 – 11

COMMODITY BACKED WAREHOUSE RECEIPT FINANCE–MODIFICATION IN SCHEME

19/05/2010 102/2010 – 11

NBG/SMEBU-COLL FREE/16/2010 – 11

COLLATERAL FREE LOANS TO MSES–COMPLIANCE WITH RBI GUIDELINES

18/05/2010 99/2010 – 11

CCO/CPPD-PRIORITY SE/11/2010 – 11

PRIORITY SECTOR LENDING EXPORT CREDIT FOR AGRICULTURE AND ALLIED ACTIVITIES

18/05/2010 98/2010 – 11


CUSTOMER COMPLAINTS RELATING TO ATM TRANSACTIONS

18/05/2010 96/2010 – 11


PERSONAL BANKING CONVERSION OF TERM DEPOSITS DAILY DEPOSITS OR RECURRING DEPOSITS FOR REINVESTMENT IN TERM DEPOSITS

18/05/2010 95/2010 – 11


PERSONAL BANKING NOMINATIONS IN TDRS/STDRS SWIPED UNDER MODS

17/05/2010 94/2010 – 11


RCPC OPENING – FORMAT FOR RECOMMENDATION / APPROVAL

17/05/2010 93/2010 – 11


RCPC-AMENDMENT IN OPERATING GUIDELINES

15/05/2010 88/2010 – 11


SBI EARNEST MONEY DEPOSIT (EMD) SCHEME : MODIFICATIONS (I) MINIMUM INCOME, (II) MARGIN, (III) LOAN AMOUNT, (IV) SECURITY

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SBI REALTY : MODIFICATIONS (I) CEILING, (II) MARGIN, (III) RISK MITIGANTS

13/05/2010 84/2010 – 11


DSP ACCOUNTS CAN BE OPENED BY ALL BRANCHES

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NBG/BOD-FMC/12/2010 – 11

PAYMENT OF FAKE TR ADVICES

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NBG/BOD-FMC/11/2010 – 11

ATTEMPTED FRAUD FABRICATED FUNDS RELEASE ORDER PURPORTEDLY ISSUED BY RBI

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DSP AIR FORCE DETAILS OF OFFER

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HCL TIE UP- COMPUTERS AT CONCESSIONAL RATES TO DSP ACCOUNT HOLDERS

12/05/2010 79/2010 – 11

NBG/BOD-GB/10/2010 – 11

PERSONAL BANKING SEGMENT REVISION / RATIONALIZATION OF SERVICE CHARGES

12/05/2010 76/2010 – 11

NBG/SMEBU-CONSTEQUIP/15/2010 – 11

MODIFICATIONS IN THE TERMS OF SME CONSTRUCTION EQUIPMENT LOAN SCHEME

12/05/2010 73/2010 – 11


DEFENCE SALARY PACKAGE FOR ASSAM RIFLES

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MCG/PMD-MGL/2/2010 – 11

METAL GOLD LOANS

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MCG/PMD-MGL/1/2010 – 11

CHANGE IN THE RATE OF INTEREST AND COMMISSION

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OUTWARD REMITTANCES – RELEASE OF FOREIGN EXCHANGE FOR VISITS ABROAD – CURRENCY COMPONENT

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PERSONAL BANKING ADVANCES LOAN AGAINST GOLD ORNAMENTS PROCESSING CHARGE

10/05/2010 68/2010 – 11


MOBILE BANKING SERVICE SERVICE OVER USSD (UNSTRUCTURED SUPPLEMENTARY SERVICES DATA)

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IMPLEMENTATION OF ADDITIONAL INTT SUBVENTION SCHEME TO PROMPT PAYING FARMERS

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NBG/ABU/BP-GREEN CHA/4/2010 – 11

GREEN CHANNEL PROGRAMME FOR EXCELLENCE REVIEW OF SCHEME

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NBG/BOD-GB/7/2010 – 11

DISPLAY OF INFORMATION REGARDING LOCAL LEVEL COMMITTEES SET UP UNDER THE NATIONAL TRUST FOR THE WELFARE OF PERSONS WITH AUTISM, CEREBRAL PALSY, MENTAL RETARDATION AND MULTIPLE DISABILITIES ACT, 1999

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LEVY OF SERVICE CHARGES – VIOLATION OF DIRECTIONS UNDER PAYMENT & SETTLEMENT ACT 2007

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CCO/CPPD-PRUDENTIAL/9/2010 –

PRUDENTIAL NORMS ON UNSECURED ADVANCES

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ASIAN CLEARING UNION (ACU) – MALDIVES MONETARY AUTHORITY

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NBG/ABU/BP-SPE. RELI/3/2010 – 11

SPECIAL CONCESIONARY INTEREST RATES FOR MINOR IRRIGATION LOANS UPTO RS.25 LACS & CROP LOANS ABOVE RS.3 LACS AND UPTO RS.25 LACS- EXTENSION

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NBG/ABU/BP-NAIS/2/2010 – 11

NATIONAL AGRICULTURAL INSURANCE SCHEME(NAIS) IMPLEMENTATION FOR KHARIF 2010

04/05/2010 54/2010 – 11


VERIFICATION OF ATM CASH RECONCILIATION OF 98549 BALANCE /ADMIN / PHYSICAL CASH

03/05/2010 53/2010 – 11


CGTMSE- DEFINITION OF PRIMARY SECURITY----CLARIFICATIONS

29/04/2010 49/2010 – 11

CCO/CPPD-EXPORT CREDIT/8/2010 – 11

RUPEE EXPORT CREDIT INTEREST RATES: INTEREST SUBVENTION- EXPORT CREDIT TO CERTAIN EMPLOYMENT ORIENTED EXPORT SECTOR

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CDO/P&HRD-PM/7/2010 – 11

TDS ON SALARIES OF EMPLOYEES : PERQUISITE VALUE ON CONCESSIONAL LOANS TO STAFF

28/04/2010 45/2010 – 11

CDO/P&HRD-PM/6/2010 – 11

STAFF : SUPERVISING : PROVISION OF FURNITURE AND FIXTURE : MODIFICATIONS

27/04/2010 44/2010 – 11


SPECIAL HOME LOANS SCHEME – LIST OF HOME LOANS COVERED BY SBILIFE

24/04/2010 43/2010 – 11


MAINTENANCE OF COLLATERAL BY FOREIGN INSTITUTIONAL INVESTORS (FIIS) FOR TRANSACTIONS IN THE CASH SEGMENT

22/04/2010 40/2010 – 11


ESTABLISHMENT OF CORRESPONDENT RELATIONSHIP ON ‘AGENCY’ BASIS – SAMAN BANK, TEHRAN, IRAN

22/04/2010 39/2010 – 11

CDO/P&HRD-IR/5/2010 – 11

STAFF : AWARD REDEPLOYMENT/TRANSFER POLICY – AUTHORITY FOR EXEMPTION FROM TRANSFER OUTSIDE THE CENTRE ON MEDICAL GROUNDS

22/04/2010 37/2010 – 11


INACTIVATION OF USER ID

22/04/2010 36/2010 – 11

IBG/FD/FD-FCL/6/2010 – 11

BUYBACK/PREPAYMENT OF FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBS)

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OVERSEAS INVESTMENTS – LIBERALISATION

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SBI TINY REMITTANCE SERVICES

21/04/2010 31/2010 – 11


IT ENABLED FINANCIAL INCLUSION PROJECT-BC / CSP – OUTLETS –PREREQUISITES

20/04/2010 30/2010 – 11

NBG/PBU/LIMA-FORMS/1/2010 – 11

MODIFICATION OF ACCOUNT OPENING FORM FOR INDIVIDUALS

19/04/2010 28/2010 – 11

NBG/PBU/PL-SCHOLAR/1/2010 – 11

PERSONAL BANKING ADVANCES – SBI SCHOLAR LOAN SCHEME- NEW PRODUCT CODES AND OTHER CLARIFICATIONS

16/04/2010 27/2010 – 11

CCO/CPPD-PRODUCT/5/2010 – 11

NEW PRODUCT : CLIENTELE BUSINESS IN CURRENCY FUTURES SBI FX TRADE

16/04/2010 26/2010 – 11

NBG/SMEBU-PRISECTOR/7/2010 – 11

PRIORITY SECTOR LENDING-ADVANCES TO MSES,ENGAGED IN EXPORTS

16/04/2010 25/2010 – 11

NBG/BOD-KYC/6/2010 – 11

OPERATIONAL RISK IN THE BANK KNOW YOUR CUSTOMER/ANTI MONEY LAUNDERING/COMBATING FINANCING OF TERRORISM (KYC/AML/CFT) MEASURES POLICY AND PROCEDURAL GUIDELINES ACCOUNTS OF PROPRIETORY CONCERNS

16/04/2010 23/2010 – 11

NBG/BOD-GB/4/2010 – 11

OUTWARD DAK – USE OF PIN CODES

08/04/2010 17/2010 – 11

NBG/BOD-FMC/2/2010 – 11

MASTER CIRCULAR POLICY ON FRAUD RISK MANAGEMENT

08/04/2010 16/2010 – 11

NBG/BOD-FMC/1/2010 – 11

OPERATIONAL RISK IN BANKS – PHISHING E-MAIL RECEIVED BY ONE OF OUR CUSTOMER

07/04/2010 15/2010 – 11


CORPORATE DEBT RESTRUCTURING REVISION IN GUIDELINES RELATING TO RECOMPENSE

07/04/2010 14/2010 – 11

CCO/CPPD-SARFAESI/3/2010 – 11

SECURITISATION & RECONSTRUCTION OF FINANCIAL ASSETS AND EFORCEMENT OF SECURITY INTEREST ACT-2002 (SARFAESI ACT-2002) REVIEW OF PANEL OF VALUERS

07/04/2010 13/2010 – 11

CCO/CPPD-BASEL/2/2010 – 11

BASEL II IMPLEMENTATION CREDIT RISK MITIGATION AND COLLATERAL MANAGEMENT (CRM AND CM) POLICY

07/04/2010 12/2010 – 11


PRUDENTIAL NORMS ON INCOME RECOGNITION,ASSET CLASSIFICATION AND PROVISIONING PERTAINING TO ADVANCES TO

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PROJECTS UNDER IMPLEMENTATION

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ATM PROJECT ISSUE, CUSTODY AND DELIVERY OF ATM CARD & PIN MAILER

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NBG/GAD-PPF/2/2010 – 11

GOVERNMENT BUSINESS : PUBLIC PROVIDENT FUND SCHEME 1968,(I) RECKONING OF DATE OF DEPOSIT IN CASE OF CHEQUE PAYMENT,(II) OPENING OF ACCOUNT OF A MINOR

05/04/2010 6/2010 – 11

NBG/ABU/BP-SUPERVISI/1/2010 – 11

AGRICULURAL TERM LOAN : OBTENTION OF POST DATED CHEQUES (PDCS)

05/04/2010 5/2010 – 11

CDO/P&HRD-IR/1/2010 – 11

STAFF WELFARE ACTIVITIES GROUP INSURANCE SCHEME FOR EMPLOYEES SAMPOORN SURAKSHA TERM PLAN

05/04/2010 4/2010 – 11

IBG/FD/FD-BFO/2/2010 – 11

FOREIGN OFFICES / SBI SUBSIDIARIES PT BANK SBI INDONESIA (SBII) DIRECTION OF BUSINESS

03/04/2010 3/2010 – 11

NBG/GAD-REV/1/2010 – 11

GOVERNMENT BUSINESS : CBEC,DATA QUALITY IN ELECTRONIC ACCOUNTING SYSTEM IN CENTRAL EXCISE AND SERVICE TAX (EASIEST)

03/04/2010 2/2010 – 11


ISSUANCE OF LCS/BGS DENOMINATED IN FOREIGN CURRENCIES – MULTI-CURRENCY ACCOUNTING

01/04/2010 876/2010 – 11

CCO/CPPD-SME/85/2010 – 11

ADVANCES-DEBT RESTRUCTURING MECHANISM FOR SMALL AND MEDIUM ENTERPRISES (SME)

10 Policy Guidelines

a. Chairman’s Policy guidelines 2011-12 (Hyperlinked)

State Bank of India As on February 2011, Savings Bank deposits have registered excellent growth of Rs.69,723

crores YOY (28%). CASA ratio has improved to 47.32% in February 2011 as compared to 43.84% in February

2010, an increase of 348 bps. Fee Income of the Bank is up by 27.25% YOY as on December 2010. We have done well to reduce the growth in Overheads to 16.42% in December 2010 from

28.17% in FY 2010.

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We have achieved a growth of 46.69% YOY in Operating Profit as on December 2010 which is higher than the target of 40% growth for FY 2011.

Net Interest Income (NII) of the Bank has increased by 44.36% YOY upto December 2010 as against a growth of 13.41% in FY 2010. Due to good NII Growth , NIM has

improved to 3.40% in December 2010 from 2.66% as on March 2010 and 2.56% in December 2009. Notwithstanding the above performance, we have seen some stress points merge during the current year, which are a cause of concern. Hence, before I move on to the expectations for the next financial year, let us take stock of our performance till the end of February 2011. In many parameters, we are behind our internal targets and in some cases, our performance is lagging behind the industry

YOY growth in deposits is 17.79%, well behind our internal target of 25%. YOY growth in advances at 21.24% is also less than our target of 24% and ASCB growth

of 23.21%. Market share in advances has thus declined from February 2010 by 6 bps to 16.73%. Current Account deposits have grown by 27.54% as against the target of 37%. As against the target of 300% growth, income from Cross Selling has grown by only 30.08% as

on February 2011. Although, we have reduced the growth in Overheads to 16.42% in December 2010 from

28.17% in FY 2010; however, the target of less than 5% growth in Overheads is still a distant object.

Other Income growth as on December 2010 is 5.25%, much below the target of 35%. We are targeting 50% of the total transactions to go through alternate channels. Till the end of December 2010, the ratio is 27.20%, up from 21.45% in March 2010. As against the target of 60 bps reduction in the Gross NPA ratio from March 2010 level of

3.05%, this has gone up by 12 bps to 3.17% till December 2010. The ratio for most major Banks has declined over the period, viz. Bank of India by 49 bps, from 2.85% to 2.36%, HDFC Bank by 32 bps, from 1.43% to 1.11%, ICICI Bank by 31 bps, from 5.06% to 4.75%, Canara Bank by 8 bps, from 1.52% to 1.44% and Axis Bank by 4 bps, from 1.13% to 1.09%. Although, our Net NPA ratio has declined by 11 bps due to higher provisions, the position is far from satisfactory.

While the target of 40% growth in Operating Profit has been surpassed by achieving 46.69% YOY growth till December 2010, due to higher provisions on account of NPAs, Net Profit growth is significantly lower at 12.94% as against the target of 30%.

challenging benchmarks for 2011-12 for the Whole Bank Parameter Whole Bank Total Deposits to grow by ® 23%

Out of which :Domestic Current Accounts » 25% Domestic Savings Bank » 28% Domestic Inter-bank Deposits » 25% NRI Deposits » 10%

Improvement in CASA Ratio from March 11 level » 140 bps Gross Advances (Non-Food) to grow by ® 23.00% Domestic Market Share (Deposits) to increase by ® 45 bps Domestic Market Share (Advances) to increase by ® 40 bps


Growth of Other Income® 26% Growth in Fee Income® 27% Overheads growth ® to be restricted to 5% Reduction in absolute Gross NPAs from Mar-11 level ® 15% Gross NPA Ratio ® 2.27% Net NPA Ratio ® 1.00% Growth in Operating Profit ® 31% Growth in Net Profit ® 25% Return on Equity ® 16.20%* Return on Assets ® 1.03% Expenses Ratio ® 44% Net Interest Margin ® 3.40% Capital Adequacy Ratio ® Above 13% * Without taking into account the Rs. 20,000 crores or so likely to be mobilised by way of Rights Issue

11 Other Policies

Compensation policy, Customer Service, Grievance Redressal Policy, Branch authorization Policy etc.

Please refer to Master Circulars issued by the Bank

12 SBI Data

Some key statistics of the Bank as at 31.03.11

SBI STAND ALONE RESULTS

_ Operating Profit: YOY growth of38.29% in FY11 over FY10

_ Net Profit is lower by 9.84% in FY11 (Rs.8264.52 crores) over FY10 mainly due to higher

pension, gratuity and loan loss provisions and standard assets provision on special home loan

schemes

FY 11 Vs FY 10

NII increased by 37.41% in FY11 over FY10

Driven by loan growth of 20.32%, interest income on advances has increased by 18.45% YOY

Growth in Interest expenses was contained at 3.27% mainly due to CASA


deposits growth of 22.14%

Non Interest Income is up by 5.72% despite profit on sale of investments declining by Rs. 1196 crores. Excluding profit on sale of investments non-interest income

is up by 15.97%.

Fee income is up by 20% YOY.

Growth in Operating Expenses is lower at 13.27% in FY11.

Gratuity provisions of Rs.1565 crores made in FY11 (Rs.46 crores in FY10).

Higher current year pension provisions of Rs.2473 crores in FY11 (Rs.1998 crores in FY 10)

Rs.7927 crores of pension liability on account of wage revision has been taken through the Capital Account for the period upto Mar 10.

Growth in overheads was significantly lower at 12.84% in FY 11 against a growth of 28.17% in FY 10.

Bank has provided additional Rs.500 crores as standard assets provision for special home loan


Loan loss provision of Rs.8792 crores made during FY11 includes Rs.6462 crores IRAC provisions and Rs.2330 crores additional provision (countercyclical provisioning buffer).

TOTAL BUSINESS GROWTH OF Rs. 2,60,139 CRORES (YOY) (Deposits Rs.1,29,817 crores &

advances Rs.1,30,322 crores).

13 Indian Economy Data

Indian Economy – Economic Survey, Budget, Monetary Policy

Economic Survey 2010-11:

OVERVIEW: The Economic Survey 2010-11, tabled in the Lok Sabha by Finance Minister on 25th February highlights the robust growth and steady fiscal consolidation which have been the hallmark of the Indian economy in the year 2010-11 so far. The growth rate has been 8.6% in 2010-11 and is expected to be around 9% in the next fiscal year.

The growth has been broad-based with a rebound in the agriculture sector which is expected to grow around 5.4%. Manufacturing and services sector have registered impressive gains. Savings and investment are looking up while exports are rising. As per the survey, the growth is expected to ride on growing services (which now have a 57.3% share in the GDP).

However, food inflation, higher commodity prices and volatility in global commodity markets have been a cause of concern underscoring the need of fiscal consolidation and stronger reserves.

The Survey cites a new Index of Government Economic Power showing that India is now the fifth greatest global economic power after the US, China, Japan and Germany, and is well ahead of Britain or France.

The survey has pegged the 9% growth with a rider that global developments and adverse weather conditions could drag it down by 0.25 percentage points, while positive factors could push it up further by the same margin. For the current fiscal, the Survey states, the economy would grow by 8.6%, up from 8% a year ago. It is expected that the growth will breach the 9% mark in 2011-12, reaching the pre-crisis levels. However, for this to happen, it suggested a slew of reforms.

REFORM AGENDA : ECONOMIC SURVEY 2010 – 11

The following reforms have been suggested by Economic Survey 2010-11 for overall growth of

economy.


Better convergence of the Schemes to avoid duplication and leakage and to ensure benefits reach to the targeted groups. Private sector participation in social sectors, such as health and education in the form of

public-social-private partnership could be one of the possible alternatives for supplementing the on-going efforts of the Government. Huge capacity addition in infrastructure in a time bound manner. Urgent need to

streamline land acquisition and environment clearance for infrastructure projects. Bringing parity between the compensation package admissible under the Land

Acquisition Act, 1894 and that applicable to land acquisition under the National Highways Act, 1956. A National Forest Land Bank, with clear paper work and titles to reduce approval time

for forest clearance. Investment in building managerial and technical capabilities of executing agencies at par

with the private sector is crucial. Second Green Revolution with technological break-through in agricultural sector.

Prioritisation of targeted development of rainfed area and effective marketing links be ensured for better returns to the farmers. Further improvements in the Mahatma Gandhi National Rural Employment Guarantee

Scheme suggested such as shifting to permanent asset building and infrastructure development activities, reducing transaction costs, better monitoring and extension of the scheme to urban areas. Efficient taxation of goods and services by a new GST. Need to explore avenues for increasing investment in infrastructure through a

combination of power investment, PPPs and occasionally exclusive private investment wherever possible.

ROBUST GDP GROWTH (Rs. In crore)

GDP AT FACTOR COST

(2004-05 PRICES)

2008-09 (QE) 2009-10 (AE)

Agriculture, forestry & fishing. 7,51,362 (0.1) 7,60,974 (1.3)

Manufacturing, construction, etc. 10,71,676 (4.7) 11,58,000 (8.1)

Trade, hotels, transport & communication. 10,87,575 (7.5) 11,93,282 (9.7)

Financing, insurance, real estate & business

services

7,06,712 (12.5)

771,763 (9.2)

Community, social & personal services. 5,45,184 (12.7) 6,09,724 (11.8)

GDP at factor cost. 41,62,509 (6.8) 44,93,743 (8.0)


(Figures in brackets represent annual growth)

INFRASTUCTURE:

The Economic Survey 2010-11 has called for innovative solutions to address the growing infrastructure deficit that is hurting economic growth. It states that financing infrastructure would be a big challenge: India needs to invest $1,025 billion in the Twelfth Plan (2012-17) and half of this should come from the private sector. To onceptual domestic savings and foreign investment, there is a need for policy interventions to balance growth and stability objectives. There is a need to onceptual retail savings into infrastructure and bring in private sector-annuity model in irrigation, water, power and rural roads.

The survey also highlighted the need to address non-financing constraints like tendering of unviable projects, bad quality of engineering and planning, lack of onceptualiz and sub-optimal contracts, land acquisition delays and slow clearances to avoid time and cost overruns. Highlighting the shortfalls in capacity additions in sectors like power and roads, the survey underlined the need to finish these projects on time.

The survey cites higher infrastructure spending as a key driver for stimulating future growth. However, unaccounted leakages of electricity (theft and transmission losses) are a whopping 35% of the electricity generated, are a major set back to growth. The power continues to be a constraint on growth. Cost overruns in public sector projects had come down to a reasonable 12% in March 2008, but rose to 20.7% by October 2010, partly due to higher steel and cement prices.

Stressing the need for huge capacity addition in infrastructure in a time-bound manner, the Survey said there was a need to explore avenues for increasing investment in this core sector through PPPs (public-private partnerships) and occasionally exclusive private investment, wherever possible. In the social sector, the Survey called for private sector participation in areas such as health and education in the form of ‘public-social-private partnership as this could be one of the possible alternatives for supplementing the ongoing efforts of the government. A national forest land bank, to help streamline the process of getting forest clearances, was one of the suggestions made by the Economic Survey.

In a section on challenges facing the infrastructure sector, the survey listed “land acquisition delays and slow approval processes, especially environmental and forest clearances,” among the constraints that need to be addressed in the infrastructure sector. It suggested that a “national forest land bank, with clear paperwork and titles, could significantly reduce the approval time for forest clearances.”

With regard to land acquisition, the survey suggested that bringing parity between the compensation packages applicable under the Land Acquisition Act 1894 and the National


Highways Act, 1956, could help. If private parties were allowed to bid for supply of land, price discovery issues could be circumvented.

FISCAL DEFICIT:

India’s fiscal deficit had ballooned to 6.3 per cent of the GDP in 2009-10 in view of stimulus spending worth billions of dollars to combat global financial meltdown, and was pegged at 5.5 per cent for the current fiscal. The Budget 2010-11, had estimated fiscal deficit to be Rs 3,81,408 crore (Rs 3814.08 billion). With growth reverting to pre-crisis levels in the current fiscal, revenues remaining buoyant and a much higher than budgeted onceptuali in non-tax revenues arising from 3G/BWA auctions, there was headroom for higher levels of expenditure at the given fiscal deficit targets,” the Economic Survey 2010-11 tabled in the Parliament said. As per the survey, the government has followed the path of fiscal consolidation during April-December FY’11, as it partially withdrew the sops given to the industry in 2008 and 2009. The government had in 2010 mobilised Rs 1.08 lakh crore from auctioning of spectrum for 3G and broadband wireless access (BWA) services. Stimulus package provided by the government at the time financial meltdown stimulus package helped India to grow by 6.8% in 2008-09, and by 8 per cent in 2009-10. “The policy stance was to continue to aid the growth momentum in the short run to facilitate its attaining pre-crisis levels and simultaneously to address long run sustainability concern.

The Survey states that the ratio of consolidated government debt to GDP, which touched 79.3% of the GDP in 2004-05, will fall to 68.7% by 2013-14 and 65% by 2014-15. The recent revision of GDP data shows that we have underestimated true GDP for many years, and hence have overestimated the fiscal deficit. This, plus high inflation this year (nominal GDP will rise 20.3% against the expected 12.5%), means that the budget estimate of a fiscal deficit of 5.5% of GDP now translates into just 4.8%. Analysts may worry about the fiscal deficit, but the Survey declares that India is galloping down the road to fiscal virtue. The fiscal deficit in the first three quarters of this year was just 44.8% of the level in the previous year.

An economic recovery will also enable the government to continue with its fiscal consolidation

process, as fiscal deficit stands revised at 4.8 per cent of gross domestic product (GDP) for the

current financial year against the Budget estimates of 5.5 per cent, says the Economic Survey

for 2010-11.INFLATIONARY TRENDS:

India has done fairly well on the food inflation front in 2010, as per the Economic Survey,

recording a lower rate of price rise in essential items than other major emerging economies of

the world, barring the Philippines. India’s food inflation was the second lowest among all

emerging economies in the 2010 calender year and the country also witnessed one of the

steepest declines in overall inflation. As per the survey India’s average food inflation in

November, 2010, was 5.4%, far lower than 15.8% in Argentina, 9.2% in Brazil and 11.7% in

China, as per data on 15 emerging nations from the International Labour Organization (ILO).

Citing data from the ILO, the Survey states that while headline inflation showed a rise in other


emerging economies, the overall rate of price rise went down in India. This was more so in the

case of food inflation, where India was among the handful of emerging economies to have

witnessed an easing in the rate of price rise.

The Survey also blamed currency competition for creating inflationary pressure in emerging

economies. Talking about the issue, it said each country’s central bank is taking steps according

to their own views. This has given rise to onceptualizi currency competitions and may be a

factor behind the recent increase in inflation in emerging economies.

Survey says that tight monetary policies would have to stay to curb inflation and mitigate global

risks such as rising food and commodity prices and debt problems in the European nations.

Inflation will remain a priority for the government which projected over 9% economic growth in

the next fiscal even as downside risks emerge from rising oil prices due to turmoil in the

Middle-East. The Survey says that current growth and inflation trend warrant persistence with

an anti-inflationary monetary stance. Consolidation of fiscal deficit would also be essential to

check the price rise. It made out a case for gradual exit of stimulus provided to the industry to

combat the impact of the global financial crisis in 2008-09.

FOREIGN INSTITUTIONAL INVESTMENT:

Volatile nature of foreign institutional investment characterized by surge and reversal of capital

flows, deceleration in foreign direct investment and the risk of further slowdown in advanced

economies may affect exports and strain balance of payments, according to the annual

economic survey.

The fragile global recovery and the robust domestic growth have led to higher current account

deficit in 2009-10 and 2010-11 (April – September), which is a matter of some concern. The

problem may be further aggravated by the rising international oil prices. However, a higher

current account deficit led to stronger absorption of foreign capital. This implied higher

investment activity financed by foreign capital, which partly contributed to the stronger

recovery in growth.

The government faces a challenge of managing the periodic surge in capital flows that could

lead to problem of absorptive capacity in the economy, fuelling asset price bubbles, currency

appreciation and stoking inflation. Meanwhile, the continuing sovereign debt risk in peripheral

euro-zone countries and fear that it could spread to the financial sector, together with the high

fiscal and public debt in several advanced countries, poses a risk to global recovery. In the event

of the crisis spreading, it could have fallout for the Indian economy through reversal of capital

flows and slowdown in exports.

Moreover, FDI inflows that are stable and productive in nature, have declined from US$ 37.7

billion in 2008-09 to US$ 33.1 billion in 2009-10 and US$ 19.0 billion in the current fiscal (up to


November 2010). Moreover, the majority of the capital inflow is in the form of FIIs, which are

volatile in nature. Steps have to be taken to encourage FDI inflows vis-à-vis other forms of

capital.

FOREIGN DIRECT INVESTMENT:

The Survey has made out a case for gradual opening of the foreign direct investment (FDI) in

multi-brand retail, in metro cities to start with. It mentioned that FDI in retail may help bring in

technical know-how to set up efficient supply chains which could act as models of

development.

Even as the debate over FDI continues, the survey said during 2011-12, projects worth Rs

24,143 crore are expected to be completed adding a capacity of 168.6 lakh square feet.

“Permitting FDI in retail in a phased manner beginning with metros and onceptualizi the

existing retail shops to onceptua could help address the concerns of farmers and consumers,”

the Economic Survey 2010-2011 said.

At present India allows 100 per cent FDI in cash and carry wholesale trading, while it is

prohibited in multi-brand retail. Up to 51% FDI has been allowed in single-brand retail since

2006.

According to the survey, during April 2006 to March 2010, India witnessed FDI inflows valued at

USD 194.69 million in the retail sector, accounting for 0.21 per cent of total FDI inflows in the

country during the period. A total of 94 proposals have been received till May, 2010, of which

57 were approved, the survey said.

The survey states that the domestic retail sector is expected to record healthy sales in 2010-11

and grow by 10.2 per cent in 2011-12. The sector’s PAT margin is expected to expand over the

next three years on account of a faster rise in income vis-a-vis expense.

In India, retail trade is a state subject. There is no national framework for its regulation and

development and states have there own regulations, the survey said, adding at the Central

level, only the flow of FDI into the sector is regulated.

EMPLOYMENT GENERATION:

“More” reforms in the education system and health sector are needed to reap the benefits of

the demographic dividend. The survey stresses on the need of “vision”, “long-term plan” and

“bold decisions”.

There has been an increase in the expenditure on social services. It increased since 2005-06,

from 5.49% of the GDP to 7.27% of GDP in 2009-10. However, the budget estimate for 2010-11

reveals a dip in the share to 6.63% of the GDP. This fits in with the Survey’s stress on the


government’s challenge in onceptual funds, especially in the area of higher education. This is

where, the Survey steps in to make a definite pitch for tailor-made public-private partnerships

in the social sector – particularly higher education. However, this should not be at the expense

of government’s regulatory oversight.

A larger outlay by the government, the emphasis put by the Survey must be accompanied by

firm policy structures for effective implementation. To this end, the Survey has suggested the

use of outcome budgets and Unique Identification (UID).

Even as the Survey onceptual the role of the Mahatma Gandhi National Rural Employment

Guarantee Act (MGNREGA) in creating employment opportunities and putting additional

money in the hands of the poor and disadvantaged, it has called for further improvements. The

specific improvements include shifting the scheme towards permanent asset building and

infrastructure development activities, reducing transaction costs, and extending the scheme to

urban areas.

Two other interventions have been suggested for this employment guarantee scheme. First, its

implementation shouldn’t result in shortage of labour during the agricultural season. Secondly,

efforts should be made to ensure its convergence of various employment and poverty

alleviations schemes to avoid duplication and leakage.

A discussion on human development indices necessitates a simultaneous one on the

environment, especially as adaptation to climate change is becoming increasingly important.

Adaptation effort inevitably is about assisting vulnerable population, and helping them build

their lives to be able to deal with impacts of climate change on their livelihood pattern and

habitat. Once again there is a close connection between the social sector, poverty alleviation

and employment schemes. The Survey reiterates the need for proper balancing of the “climate”

challenge and “growth” challenge. The focus of reform in education is clearly in the higher

education sector; reform in primary education has been addressed in a measure the Right to

Education.

AGRICULTURE SECTOR:

The Survey has observed that things are looking bright in the current year with a relative good

monsoon and the agriculture sector is expected to grow at 5.4% as per the 2010-11 advance

estimates (AE). There is a marked improvement in the gross capital formation (GCF) also in

agriculture sector.”

Underlining the importance of the agricultural sector in the Indian Economy, the Survey says

that the agriculture sector needs to grow at 8.5% during 2011-12 to achieve the Plan target of

average 4% growth per year.


The Survey points out that the Increased Minimum Support Price (MSP) along with various

other steps taken by the Government have resulted in higher levels of food-grains. While the

economic cost of wheat and rice has continuously gone up, the issue price has been kept

unchanged since July 1, 2002.

The country has made great strides towards increasing food grains production. In spite of that

the agriculture sector is at a cross roads with rising demand for food items and relatively slower

supply response in many commodities resulting frequent spikes in food inflation.

The Survey says that increasing agriculture production and productivity is a necessary condition

not only for ensuring national food security but also for sustaining the high levels of growth.

Concerted and focused efforts are required for addressing the challenge of stagnating

productivity levels in agriculture. It suggests a holistic approach, including renewed agricultural

research, dissemination of technology, better inputs such as quality seeds, fertilizers and

modern irrigation facilities.

Specially rice and wheat, the Survey says that given the constraints in area expansion there is a

need for further research to boost production and productivity. Similarly, a technological

breakthrough in pulse production is necessary to keep pace with rising demand. Significant

increase in the area under sugarcane and cotton suggests some shift in the cropping pattern in

Kharif 2010, the Survey observes

Expressing concern over stagnation of capital investment in the sector, it says both private and

public sector should enhance the investment in agriculture sector in a sustained way.

A targeted development of rainfed area should be prioritized and effective marketing links

should be ensured for better returns to the farmers. The Government should also encourage in

food processing, cold chain and handling and packaging of processed food, the Survey says.

Taking a note of declining per capita availability of foodgrains, the Survey suggests thrust on

horticulture products. In view of increasing pressure on livestock products due to rising level of

income, a long term strategy should be evolved to increase the production of these items. It

also says that the issue of efficient food stocks management of and uploading of stocks in time

needs urgent attention.

The Economic Survey for 2010-11 has said that increased investment in agriculture was vital if

the country had to sustain high levels of economic growth, and that a “second green

revolution” is urgently needed.

While demand for food has risen sharply with growing income, there are periodic bouts of price

spikes due to supply-side constraints.


“Increasing agriculture production and productivity is a necessary condition not only for

ensuring national food security, livelihood security, and nutritional security but also for

sustaining the high levels of growth envisaged in the current Plan,” the Survey said.

“A holistic approach, simultaneously working on agricultural research, development,

dissemination of technology, and provision of agricultural inputs such as quality seed, fertilizers,

pesticides, and irrigation, would help to achieve the critical levels of productivity needed,” the

Survey added.

Capital investment in agriculture as a percentage of the GDP has been stagnating in recent

years, although the capital expenditure in agriculture as a percentage of the GDP in agriculture

has shown some improvement in the current Five Year Plan

“The real challenge in agriculture sector is to enhance capital investment in the sector both by

public and private sector in a sustained way,” the Survey said.

HUMAN DEVELOPMENT:

Discussion on human development indices necessitates a simultaneous one on the

environment, especially as adaptation to climate change is becoming increasingly important.

Adaptation effort inevitably is about assisting vulnerable population, and helping them build

their lives to be able to deal with impacts of climate change on their livelihood pattern and

habitat. Once again there is a close connection between the social sector, poverty alleviation

and employment schemes. The Survey reiterates the need for proper balancing of the “climate”

challenge and “growth” challenge. In doing so, it would appear to have not adhered to its own

suggestion of “vision” and “bold decisions”. Instead, the Survey appears to come down on the

side of “growth”. The Survey suggested private participation in social sectors such as health and

education in the form of public-social-private-partnership to supplement the government

efforts. The focus of reform in education is clearly in the higher education sector; reform in

primary education has been addressed in the Right to Education.

MORE BANKING LICENCES

India’s Economic Survey 2010-11, recommended more banking licences but added that strict

regulations must be in place before granting licenses to more players. ‘Providing access to

banking facility to all the citizens is one of the main objectives of the inclusive development.

While providing banking access, the issue of regulatory robustness for the banking sector

should not be compromised,’ said the annual report on the state of the economy in the current

fiscal.


According to the survey, the minimum capital requirement for those proposing to start a

banking institution should be graded, while the government should consider having two

banking licenses – one for those who would provide basic financial services to unbanked areas

and the other to those involved in all spheres of banking services. The survey said that

industrial houses and non-banking finance corporations (NBFC) should be considered for full

banking licenses, only with clearly defined roles and regulations. ‘MFIs (micro finance

institutions) and NBFCs should be considered for being given license for basic banking. It is very

essential that the basic banking functions are clearly and objectively defined.’ On the entry of

more foreign promoters and banks, the survey said that only those entities which clear the

regulatory requirements should be considered for a licenses. ‘The principle of reciprocity could

also be applied to countries that have allowed Indian banks to expand in their jurisdictions,’ the

survey added.

ENVIRONMENT VERSUS GROWTH:

The survey points out that careful planning and onceptual policies are needed to ensure that

the green growth strategies do not result in slow growth strategy. Clearly, the Survey is not

looking beyond a conventional approach to growth. However, within this approach it accepts

that environmental protection is important. Expressing concern over delays in execution of

projects owing to tussles between ministries such as coal and power in cases where the

Ministry of Environment and Forest has raised certain policy issues, the Survey suggested an

“urgent need to streamline land acquisition and environment clearance for infrastructure

projects”. In this regard, it also called for creation of a National Forest Land Bank with clear

paper work and title to reduce the approval time for forest clearance.

Other major reform initiatives suggested include streamlining of environment clearance for

infrastructure projects, the need for an early introduction of GST for “efficient taxation” of

goods and services and the dire necessity of a second ‘Green Revolution’ with technological

break-through in the farm sector.

BUDGET 2011 – 12 :

OPPORTUNITIES

Swift and broad based growth in 2010-11 has put the economy back to its pre-crisis growth

trajectory. Fiscal consolidation has been impressive. Critical institutional reforms are being

made to set the pace for double-digit growth in the near future. Rural economy is booming due

to scaled up flow of resources to the rural areas.

CHALLENGES

Structural concerns on inflation management to be addressed by improving supply response of agriculture to the expanding domestic demand and through stronger fiscal consolidation.


Implementation gaps, leakages from public programmes and the quality of outcomes pose a serious challenge.

Corruption as a problem to be fought collectively. Government to improve the regulatory standards and administrative practices.

OVERVIEW OF THE ECONOMY

Gross Domestic Product estimated to have grown at 8.6% in 2010-11 in real terms. Continued high food prices have been principal concern this year.

Consumers denied the benefit of seasonal fall in prices despite improved availability of food items, revealing shortcomings in distribution and marketing systems.

Exports have grown by 29.4%, while imports have recorded a growth of 17.6% during April to Jan. 2010-11 over the corresponding period last year.

Economy expected to grow at 9% with an band of +/- 0.25% in 2011-12. Average inflation expected lower next year and current account deficit smaller.

BUDGET ESTIMATES 2011-12

Gross Tax receipts are estimated at Rs. 9,32,440 crore. Non-tax revenue receipts estimated at Rs.1,25,435 crore. Total expenditure proposed at Rs. 12,57,729 crore. Increase of 18.3 per cent in total Plan allocation. Increase of 10.9 per cent in the Non-plan expenditure. XI Plan expenditure more than 100 per cent in nominal terms than envisaged for the Plan

period. Increase of 23% in Plan and Non-plan transfer to States and Uts. Fiscal Deficit brought down from 5.5 per cent in BE 2010-11 to 5.1 per cent of GDP in RE

2010-11. Fiscal Deficit kept at 4.6% of GDP for 2011-12. Fiscal Deficit to be progressively reduced to 3.5% by 2013-14. Effective Revenue Deficit” estimated at 2.3 per cent of GDP in the Revised Estimates for

2010-11 and 1.8% for 2011-12. All subsidy related liabilities brought into fiscal accounting. Net market borrowing of the Government through dated securities in 2011-12 would be Rs.

3.43 lakh crore. Central Government debt estimated at 44.2 per cent of GDP for 2011-12 as against 52.5%

recommended by the 13th Finance Commission. GDP for 2011-12 projected at Rs. 89,80,860 crores.

BUDGET AT A GLANCE

S. No. BUDGET HEAD (RS. IN CR)

1 Revenue Receipts 7,89,892


2 Capital Receipts 4,67,837

3 Total Receipts 12,57,729

4 Non-Plan Expenditure 8,16,182

5 Plan Expenditure 4,41,547

6 Total Expenditure 12,57,729

7 Revenue Deficit (3.4% of GDP) 3,07,270

8 Fiscal Deficit (4.6 % of GDP) 4,12,817

9 Primary Deficit (1.6% of GDP) 1,44,831

GOVERNMENT HOUSEKEEPING

RUPEE COMES FROM RUPEE GOES TO

Borrowings 27p Central Plan Outlay 22p

Corporate Tax 24p Plan Assistance to States /

Uts.

07p

Income Tax 11p Non-Plan Expd. To States /

Uts.

05p

Customs Duty 10p Non-plan Expenditure 11p

Union Excise Duty 11p State’s Share of Taxes 17p

Service Tax 06p Interest Payments. 18p

Non-Tax Revenue 08p Defense 11p

Non Debt Capital Receipts 03p Subsidies 09p

TOTAL 100 TOTAL 100

Important Budget proposals and their implications:


1 BUDGET PROPOSAL: DTC TO BE IMPLEMENTED FROM 1ST APRIL, 2012.

IMPLICATIONS: The Direct Taxes Code (DTC) will replace the Income Tax Act 1961 and

come into force from 1st day of April, 2012. The Income Tax Act was passed in 1961.

Amended every year through the Finance Acts and interpreted through the multitude

of judgments rendered by the courts, it had become incomprehensible to the average

tax payer.

SALIENT FEATURES

Single Code for Direct Taxes: All the Direct Taxes have been brought under a single Code and compliance procedures unified. This will eventually pave the way for a single unified taxpayer reporting system.

Simple language, reducing the scope for litigation, and improved delivery mechanisms of the Government.

DIRECT TAXES CODE (DTC) – KEY PROPOSALS

DTC initiates radical tax reforms. It replaces the over four-decades old Income Tax Act and brings all other direct taxes like Wealth tax under its purview.

While the code proposes abolition of the controversial Securities Transaction Tax, but suggests reintroduction of long term Capital Gains tax on Securities trading. Tax deduction limit on Savings to be hiked to Rs.3,00,000.

The code proposes to exempt the general tax payer from paying Income tax if his income is upto Rs.2,00,000 in a year.

Income tax slabs proposed to be changed; highest tax rate of 30% for individuals to be applicable for income over Rs.10,00,000.

DTC was introduced in the Parliament in August, 2010, but it was not passed by the

house, due to some objections. To review the objections, a standing committee was set

up and after receipt of report, the DTC will be implemented. This has been a pioneering

effort in participative legislation. The Code is proposed to be effective from April 1,

2012 to allow taxpayers, practitioners and administrators to fully understand the

legislation and adjust to the revised procedures.

2 BUDGET PROPOSAL: GST AMENDMENT BILL PRESENTED IN BUDGET SESSION OF

PARLIAMENT.

IMPLICATIONS: A major tax reform is underway in India, which when implemented will

transform the present tax system and administration completely and usher in the era of

a common Goods & Services Tax (GST).


At present, India has a mix of taxes on goods and services at the Centre and a goods tax

(State VAT) as well as taxation of select services (e.g. entertainment) at the State level,

plus a variety of local levies. This complicated structure had led to harassment, evasion

and corruption. Most important of all, it had hampered free movement of goods inside

the country. The Fiscal Responsibility and Budget Management Task Force, had pointed

out that a modern tax system ought to have three key elements:

a) Uniform treatment of goods and services.

b) Basing the entire tax system upon just two taxes: Income tax and GST, and

c) Removal of all barriers to the movement of goods and services across the country, so

as to achieve a unified common market. A goods and service tax (GST), has the

potential to meet these requirements.

Essentially, GST is a value-added tax that requires producers to pay tax only on the

value they add to the goods or service, whereas in the current system Central and State

taxes cascade on the price of the final product. Unlike DTC, decisions on the GST have

to be taken in consultation with the States with whom Govt. has made considerable

progress in the last four years. Areas of divergence have been narrowed. Work is also

underway on drafting of the model legislation for the Central and State GST. Among

the other steps that are being taken for the introduction of GST is the establishment of

a strong IT infrastructure. Significant progress has been made on the GST Network

(GSTN). The key business processes of registration, returns and payments are in

advanced stages of onceptualiz. The National Securities Depository Limited (NSDL) has

been selected as technology partner for incubating the National Information Utility that

will establish and operate the IT backbone for GST. By June 2011, NSDL will set up a

Pilot portal in collaboration with eleven States prior to its roll out across the country.

3 BUDGET PROPOSAL: NBS REGIME TO COVER UREA IS UNDER ACTIVE CONSIDERATION

OF THE GOVERNMENT.

IMPLICATIONS The previous Budget took note of the diminishing response of Indian

soils to added onceptuali in terms of increase in crop yield and announced measures

to correct this anomaly by ensuring balanced use of onceptual nutrients. The

government decided to move towards a Nutrient-based Subsidy (NBS) regime instead

of the product-pricing regime. It essentially means subsidy on actual nitrogen (N),

phosphorus (P) and potassium (K) content of different onceptual formulations, rather

than blanket subsidy on the whole onceptual product irrespective of the nutrient

status. As a result, the manufacturers were encouraged to produce onceptuali

fortified even with micronutrients, such as zinc, sulphur, manganese and the like, which


are becoming scarce in Indian soils because of the use of relatively purer forms of

chemical onceptuali. NBS has improved the fertility of the soils, showing up in higher

crop yields. The NBS policy was successfully implemented for all onceptuali except

urea. The policy has been well received by all stakeholders, and the availability of

onceptuali has improved. Govt. has therefore proposed to extend this to one of the

most popular fertliser with the Indian farmers – Urea.

4 BUDGET PROPOSAL: THE GOVERNMENT WILL MOVE TOWARDS DIRECT TRANSFER OF

CASH SUBSIDY TO PEOPLE LIVING BELOW POVERTY LINE IN A PHASED MANNER.

IMPLICATIONS: The Government provides subsidies, notably on fuel and food grains, to

enable the common man to have access to these basic necessities at affordable prices.

A significant proportion of onceptual fuel does not reach the targeted beneficiaries

and there is large scale diversion of these items. To ensure greater efficiency, cost

effectiveness and better delivery for both kerosene and onceptuali, the Government is

considering direct transfer of cash subsidy to people living below poverty line. A Task

Force headed by Shri Nandan Nilekani has been set-up to work out the modalities for

the proposed system of direct transfer of subsidy for kerosene, LPG and onceptuali.

The interim report of the task force is expected by June 2011. The system will be in

place by March 2012.

5 BUDGET PROPOSAL: GOVERNMENT TO RAISE RS. 40,000 CRORE THROUGH

DISINVESTMENT IN 2011 – 12.

IMPLICATIONS: The Government’s programme to broadbase the ownership of Central Public Sector Undertakings (CPSUs) has received an overwhelming response. The six public issues of CPSUs in the current financial year have attracted around 50 lakh retail investors. A higher than anticipated onceptuali in non-tax revenues has led Govt. to reschedule some of the divestment issues planned for the current year. To maintain the momentum on disinvestment, Govt proposes to raise Rs.40,000 crore through disinvestment in 2011-12.

6 BUDGET PROPOSAL: SEBI REGISTERED MUTUAL FUNDS ALLOWED TO ACCEPT

SUBSCRIPTIONS FROM FOREIGN INVESTORS.

IMPLICATIONS: Currently, only FIIs and sub-accounts registered with the SEBI and NRIs

are allowed to invest in mutual fund schemes. To liberalise the portfolio investment

route, Govt. has decided to permit registered mutual funds to accept funds from

foreign investors who meet the KYC requirements for equity schemes. This would

enable Indian Mutual Funds to have direct access to foreign investors and widen the

class of foreign investors in Indian equity market.


7 BUDGET PROPOSAL: FII’s limit for investment in Corporate Bonds has been raised to $

25 billion.

IMPLICATIONS: To enhance the flow of funds to the infrastructure sector, the FII limit for investment in corporate bonds, with residual maturity of over five years issued by Companies in infrastructure sector, is being raised by an additional limit of US Dollar 20 billion taking the limit to US Dollar 25 billion. This will raise the total limit available to the FIIs for investment in corporate bonds to US Dollar 40 billion. Since most of the infrastructure companies are onceptua in the form of SPVs, FIIs would also be permitted to invest in unlisted bonds with a minimum lock-in period of three years. However, the FIIs will be allowed to trade amongst themselves during the lock-in period.

8 BUDGET PROPOSAL: Government provided a sum of Rs.20,157 cr for infusion in the

Public Sector Banks.

IMPLICATIONS: During the year 2010-11, the Government provided a sum of Rs.20,157

crore for infusion in the Public Sector Banks (PSB) to maintain Tier I Capital to Risk

Weighted Asset Ratio (CRAR) at 8 per cent and increase government equity in some

banks to 58 per cent. However, with the increase in loans portfolio of banks, they

required more Tier I capital. More funds are being infused to meet this requirement.

Similarly, as a part of financial strengthening of Regional Rural Banks, an amount of

Rs.500 crore would be invested in these during 2011-12 to enable them maintain a

CRAR of at least 9 per cent as on March 31, 2012.

9 BUDGET PROPOSAL: Corpus of RIDF XVII Raised To Rs.18,000 Crore

IMPLICATIONS: The Rural Infrastructure Development Fund (RIDF) is an important

instrument for routing Indian banks’ funds for financing of rural infrastructure. The

banks which fail to achieve targets of priority sector lending are required to invest

amount equivalent of shortfall in RIDF. The additional allocation made this year would

be dedicated to creation of warehousing facilities.

10 BUDGET PROPOSAL: Public Sector Banks to lend 15% priority sector loans to minority

communities.

IMPLICATIONS: Minority communities include Muslims, Sikhs, Christians, Buddhists and

Parsees. To ensure that they are not neglected vis a vis majorities, Govt. has decided to

fix a target for their share in public sector banks financing.

11 BUDGET PROPOSAL: Existing scheme of Interest Subvention of 1% on housing loans has

been extended to housing loan upto Rs.15 lakh where the cost of the house does not

exceed Rs.25 lakh from the present limit of Rs.10 lakh and Rs. 20 lakh respectively.


IMPLICATIONS: Interest subvention refers to a system wherein a part of interest

applicable on a loan account is recovered from the Govt. and not from the borrower

thereby providing some relief to the borrowers. This has been done to encourage

housing sector. Also, the limit for inclusion of housing loans in priority sector has also

been increased to Rs. 25 lac from existing Rs. 20 lac.

12 BUDGET PROPOSAL: Government has facilitated setting up of Central Electronic Registry under the SARFAESI Act, 2002.

IMPLICATIONS: To prevent frauds in loan cases involving multiple lending from different banks on the same immovable property, the Government has facilitated setting up of Central Electronic Registry under the SARFAESI Act, 2002. This Registry will become operational by March 31, 2011.

13 BUDGET PROPOSAL: Banks credit target for farm credit raised to Rs. 4,75,000 crore.

IMPLICATIONS: Agriculture development is central to the growth strategy of the economy. To get the best from their land, farmers To get the best from their land, farmers need access to affordable credit. Banks have been consistently meeting the targets set for agriculture credit flow in the past few years. For the year 2011-12, the Govt. is raising the target of credit flow to the farmers from Rs.3,75,000 crore this year to Rs.4,75,000 crore in 2011-12. This will ensure additional flow of Banks credit for agriculture and credit to small and marginal farmers.

14 BUDGET PROPOSAL: Interest subvention for timely repayment of farm loans has been

raised to 3% from 2% at present.

IMPLICATIONS: The existing interest subvention scheme of providing short term crop

loans to farmers at 7 per cent interest will be continued during 2011-12. In the last

budget, additional 2 per cent interest subvention was provided to those farmers who

repay their crop loans on time. The response to this scheme has been good. In order to

provide further incentive to these farmers, subvention has been raised. Thus, the

effective rate of interest for such farmers will now be 4 per cent per annum.

15 BUDGET PROPOSAL: Cold chains and post-harvest storage to be part of Infrastructure

sub-sector.

IMPLICATIONS: To attract investment in this sector, henceforth, capital investment in the creation of modern storage capacity will be eligible for viability gap funding scheme of the Finance Ministry. It is also proposed to recognize cold chains and post-harvest storage as an infrastructure sub-sector.

16 BUDGET PROPOSAL: An allocation of over Rs.2,14,000 crore is being made for development of Infrastructure sector.


IMPLICATIONS: Infrastructure refers to basic facilities that are essential for development of other industries etc. It includes investment in power, transport network, ports, and container services and like. Government established India Infrastructure Finance Company Limited (IIFCL) to provide long term financial assistance to infrastructure projects. In order to give a boost to infrastructure development in railways, ports, housing and highways development, tax free bonds of Rs. 30,000 crore will be issued by various Government undertakings in the year 2011-12.

17 BUDGET PROPOSAL: A sum of Rs. 52,057 crore has been allocated for Education.

IMPLICATIONS: Our “demographic dividend” of a relatively younger population compared to developed countries is as much of an opportunity as it is a challenge. Over 70 per cent of Indians will be of working age in 2025. In this context, onceptualizin access to secondary education, increasing the percentage of our scholars in higher education and providing skill training is necessary. As such, for education, Govt has allocated Rs.Rs.52,057 crore, which is an increase of 24 per cent over the current year .

OTHER INITIATIVES:

Sarva Shiksha Abhiyan: The existing operational norms of Sarva Shiksha Abhiyan have been revised to implement the right of children to free and compulsory education which has come into force with effect from April 1, 2010. For the year 2011-12, the budget proposes to allocate Rs.Rs 21,000 crore which is 40 per cent higher than Rs 15,000 crore allocated in the Budget for 2010-11. A revised Centrally Sponsored Scheme “Vocationalisation of Secondary Education” will be implemented from 2011-12 to improve the employability of our youth.

Empowerment flows from Education: While the Scheduled Castes and Scheduled Tribes had access to post matric scholarships, there was so far a lack of pre-matric scholarship scheme. In 2011-12, the Govt. propose to introduce a scholarship scheme for needy students belonging to the Scheduled Castes and Scheduled Tribes studying in classes ninth and tenth. It would benefit about 40 lakh Scheduled Caste and Scheduled Tribe students.

National Knowledge Network: Approved in March 2010, the National Knowledge Network (NKN) will link 1500 Institutes of Higher Learning and Research through an optical fibre backbone. During the current year, 190 Institutes will be connected to NKN. Since the core will be ready by March 2011, the connectivity to all 1500 institutions will be provided by March 2012.

18 BUDGET PROPOSAL: Project ‘Swabhiman’ has been launched.

IMPLICATIONS: Last year, Banks were advised to provide banking facilities to habitations having a population of over 2000 by March, 2012. The RBI has identified about 73,000 such habitations for providing banking facilities using appropriate technologies. Banks have been advised to open 5 crore accounts in these 73,000 villages. A multi-media campaign, “Swabhimaan”, has been launched to inform,


educate and motivate people to open bank accounts. During this year, banks will cover 20,000 villages. Remaining will be covered during 2011-12.

19 BUDGET PROPOSAL: Government contribution in ‘Swablamban’ scheme has been increased from 3 years to 5 years.

IMPLICATIONS: New Pension Scheme ‘Pensionlite’ was launched on May 1, 2009 by Pension Fund Regulatory and Development Authority (PFRDA) for all citizens of India, in the age group of 18 to 55 years. The scheme was primarily meant for workers in unorganized sector. However, the response was very lukewarm which prompted govt. offer this incentive. A co-contributory pension scheme “Swavalamban” was announced in the Budget 2010-11. As per this scheme persons joining the PFRDA’s pension scheme with a contribution of Rs 1,000 to Rs 12,000 per anum, will also get a contribution of Rs. 1,000 per account per anum for three years. The benefit of Government contribution has now been raised from three to five years for all subscribers of Swavalamban who enroll during 2010-11 and 2011-12. An estimated 20 lakh beneficiaries will join the scheme by March 2012. On the basis of the feedback received, the exit norms for the scheme have been relaxed whereby a subscriber under Swavalamban will be allowed exit at the age of 50 years instead of 60 years, or a minimum tenure of 20 years, whichever is later.

20 BUDGET PROPOSAL: MAT has been increased to 18.50%

IMPLICATIONS: Minimum Alternate Tax (MAT) was introduced in the direct tax system

to make sure that companies having large profits and declaring substantial dividends to

shareholders but who were not contributing to the Govt by way of corporate tax, by

taking advantage of the various incentives and exemptions provided in the Income-tax

Act, pay a fixed percentage of book profit as minimum alternate tax. To continue the

process of phasing out the surcharge, current surcharge of 7.5 per cent on domestic

companies has been reduced to 5 per cent. Simultaneously, rate of Minimum Alternate

Tax (MAT) has been raised from the current rate of 18 per cent to 18.5 per cent of book

profits to keep the effective rate of the MAT at the same level. As a measure to ensure

equal sharing of the corporate tax liability, MAT is proposed to be levied on developers

of Special Economic Zones as well as units operating in SEZs.

21 BUDGET PROPOSAL: Several measures have been proposed to improve Service Tax

collections.

IMPLICATIONS: The actual collections of Service Tax do not reflect the full potential of

this sector. To achieve a closer fit between the present service tax regime and its GST

successor following measures are proposed:

Bringing in a few new services into the tax net to expand the tax base while ensuring that the impact is predominantly on sections of society that have the


ability to pay;

Suitably expanding or rationalizing the scope of existing service categories;

Rationalizing certain provisions relating to import of services and valuation;

Modifying provisions of the Cenvat Credit scheme to achieve a more realistic balance between input credits and output tax and onceptuali the provisions of the scheme across goods and services;

Rationalizing penal provisions to reinforce the message that honest taxpayers would be facilitated and deviants would be dealt with severely; and

Adoption of Point of Taxation rules for services which would shift the basis for tax collection from “cash” towards “accrual” basis as with Central Excise duty.

Further, it is proposed to levy Service Tax on the following new services:

Hotel accommodation, in excess of declared tariff of Rs.1,000 per day with an abatement of 50 per cent so that the effective burden is only 5 per cent of the amount charged;

Service provided by air-conditioned restaurants that have license to serve liquor, by giving an abatement of 70 per cent. Thus, the effective burden will be 3 per cent of the bill.

22 BUDGET PROPOSAL: Govt. has proposed to create India Microfinance Equity Fund

IMPLICATIONS: The Micro Finance Institutions (MFIs) have emerged as an important means of financial inclusion. Creation of a dedicated fund for providing equity to smaller MFIs would help them maintain growth and achieve scale and efficiency in operations. As such, the Budget has proposed to create in the course of the year, “India Microfinance Equity Fund” of Rs.100 crore with SIDBI. Further, to empower women and promote their Self Help Groups (SHGs), the budget propose to create a “Women’s SHG’s Development Fund” with a corpus of Rs. 500 crore.

RBI had appointed a Committee to look into issues relating to micro finance sector in India. The committee has submitted its report. The Government is considering putting in place appropriate framework to protect the interests of small borrowers.

23 BUDGET PROPOSAL: The Budget has taken several measures to boost the Infrastructure development.

IMPLICATIONS: Infrastructure is critical for our development. For 2011-12, an allocation of over Rs. 2,14,000 crore is being made for this sector, which is 23.3% higher than current year. This amounts to 48.5% of the Gross Budgetary Support to plan expenditure.

OTHER INITIATIVES

PPP Model: The experience with PPP model for creation of public sector assets in the country has been good. Govt. has recently launched the National Capacity Building


Programme to enhance capacities of public functionaries in identifying, onceptualizing, structuring and managing PPPs. Govt. is proposing to come up with a comprehensive policy that can be used by the Centre and the State Governments in further developing public-private partnerships.

India Infrastructure Finance Company Limited (IIFCL): Government established India Infrastructure Finance Company Limited (IIFCL) to provide long term financial assistance to infrastructure projects. It is expected to achieve a cumulative disbursement target of Rs. 20,000 crore by March 31, 2011 and 25,000 crore by March 31, 2012. The take-out financing scheme announced in the Budget 2009-10 has been implemented and seven projects have been sanctioned with a debt of 1,500 crore. Another 5,000 crore will be sanctioned during 2011-12.

Tax Free Bonds: In order to give a boost to infrastructure development in railways, ports, housing and highways development, Govt. propose to allow tax free bonds of 30,000 crore to be issued by various Government undertakings in the year 2011-12. This includes Indian Railway Finance Corporation Rs.10,000 crore, National Highway Authority of India Rs.10,000 crore, HUDCO Rs.5,000 crore and Ports Rs.5,000 crore.

24 BUDGET PROPOSAL: Govt. is proposing to create appropriate legislative framework to curb Black Money.

IMPLICATIONS: The generation and circulation of black money is an area of serious concern. To deal with this problem effectively, Government has put into operation following five-fold strategy:

a) Joining the global crusade against ‘black money’;

b) Creating an appropriate legislative framework;

c) Setting up institutions for dealing with illicit funds;

d) Developing systems for implementation; and

e) Imparting skills to the manpower for effective action.

OTHER INITIATIVES

Financial Action Task Force (FATF): Last year the Govt. secured Membership of the Financial Action Task Force (FATF). This is an important initiative of G-20 for anti-money laundering. India has also joined the Task Force on Financial Integrity and Economic Development, Eurasian Group (EAG) and Global Forum on Transparency and Exchange of Information for Tax Purposes.

Double Taxation Avoidance Agreements (DTAAS): During 2010-11, the Govt. concluded discussions for 11 Tax Information Exchange Agreements (TIEAs) and 13 new Double Taxation Avoidance Agreements (DTAAs) along with revision of provisions of 10 existing DTAAs. Further, to effectively handle the increase in tax information exchange and transfer pricing issues, Foreign Tax Division of CBDT has been strengthened.

Money Laundering Legislation in 2009: The amendment in Money Laundering Legislation in 2009 has significantly increased its scope and application. The number of


cases registered under this law has increased from 50 between 2005 to 2008 to over 1200 by January this year. The strength of the Enforcement Directorate has been increased three-fold to deal effectively with the increased workload.

Trafficking in narcotic drugs: Trafficking in narcotic drugs is also a contributor to the generation of black money. To strengthen controls over prevention of trafficking and improve the management of narcotic drugs and psychotropic substances, Govt. proposes to announce a comprehensive national policy in the near future.

Monetary Policy 2011-12:

Based on the recommendations of Working Group to Review the Operating Procedure of Monetary Policy in India (Chairman: Shri Deepak Mohanty), it has been decided:

(iv) The weighted average overnight call money rate will be the operating target of monetary policy.

(ii) There will henceforth be only one independently varying policy rate and that will be the repo rate.

(iii) The reverse repo rate will continue to be operative but it will be pegged at a fixed 100 basis points below the repo rate. Hence, it will no longer be an independent rate.

(iv) A new Marginal Standing Facility (MSF) will be instituted from which SCBs can borrow overnight up to 1% of their respective NDTL. The rate of interest on this facility will be 100 basis points above the repo rate.

Repo Rate is increased by 50 basis points from 6.75% to 7.25% with immediate effect. Reverse Repo Rate is determined with a spread of 100 basis point below the repo rate (6.25%). Marginal Standing Facility (MSF) Rate determined with a spread of 100 basis points ( 8.25%) Bank Rate has been retained at 6.0 % Cash Reserve Ratio (CRR) of scheduled banks has been retained at 6.0 % of their NDTL.

Savings Bank (SB) Deposit Interest Rate: The discussion paper of deregulating the SB interest rate was placed on the Reserve Bank’s website on April 28, 2011 for feedback from the general public.

Pending a final decision on deregulation, SB interest rate increased from 3.5% to 4.0% immediately.

Micro finance institutions (MFIs): With the Malegam Committee recommendations Bank loans to all MFIs, will be eligible for classification as priority sector under indirect finance if they adhere to the “qualifying assets” & to the “pricing of interest”;

“Qualifying asset’’ is required to satisfy the criteria of (i) loan disbursed by an MFI to a borrower with a rural household annual income not exceeding 60,000 or urban/ semi-urban household income not exceeding 1,20,000; (ii) loan amount not to exceed

35,000 in the first cycle and 50,000 in subsequent cycles; (iii) total indebtedness of the borrower not to exceed 50,000; (iv) tenure of loan not to be less than 24 months for loan amount in excess of 15,000 without prepayment penalty; (iv) loan to be extended without collateral; (v) aggregate amount of loan, for income generation, not


to be less than 75% of the total loans given by the MFIs; and (vi) loan to be repayable by weekly, fortnightly or monthly instalments at the choice of the borrower;

• Financing banks should ensure a margin cap of 12 % and an interest rate cap of 26% is to be maintained

by MFI to be eligible for priority sector loans;

• Loans by MFIs can also be extended to individuals outside the (SHG)/joint liability group (JLG)

Bank loans to other NBFCs would not be reckoned as priority sector loans with effect from April 1, 2011.

It is proposed to appoint a committee to re-examine the Priority sector existing classification

Domestic SCBs are being mandated to allocate at least 25% of the total number of branches to be opened during a year to unbanked rural (Tier 5 and Tier 6) centres.

It is proposed to enhance the provisioning requirements on advances as under:

• “Sub-standard” asset will attract a provision of 15% (earlier 10%)

Unsecured sub-standard assets –Additional 10%, (i.e., a total of 25% as against the existing 20%);

• “Doubtful” (upto one year) -25% ( existing 20%); “Doubtful” (1 to 3 years – 40% (existing 30%);

• Restructured accounts (standard asset) in the first 2 years of restructuring – 2% (existing 0.25-1.00 %)

Investment in liquid schemes of of debt oriented mutual funds (DoMFs) by banks will be subject to a prudential cap of 10% of their net worth as on March 31 of the previous year.

Transaction limit through mobile-based semi-closed prepaid instruments issued by non-banks is made on par with other semi-closed payment instruments by raising the limit from

5,000 to 50,000.

Mobile-based transaction facility without end-to-end encryption is enhanced from 1,000 to 5,000.

Short Sale in Government Securities is extended from the existing five days to a max. Three months.

Delivery versus payment (DvP) III facility is extended to transactions by the gilt account holders (excluding transactions between the gilt account holders of the same custodian).

FIIs are allowed to cancel and rebook up to 10 % of the market value of the portfolio at the beginning of the financial year.

Facilitating Rupee Trade – Hedging Facilities for Non-resident Entities –Exports and imports invoiced in Indian Rupees, non-resident importers and exporters can hedge their currency risk with AD banks in India through their bankers having Rupee vostro accounts in India. The contracts would be on a deliverable basis.

To facilitate genuine foreign exchange transactions by individuals – residents/non-resident Indians a Committee (Chairperson: Smt. K.J. Udeshi) comprising the


representatives of various stakeholders has been set up. The Committee is expected to submit its report within three months.

14 Customer Service

Segmentation of customers on the basis of

Net Worth

High Net worth Individuals (HNIs) Re-defined as per Population Groups.

Population

Group’s

Total

Relationship

(Minimum 2

out of

a,b & c) Rs.

Advances

Minimum

(a)

Rs.

Deposits

Minimum

( b)

Rs.

Assets under

Management

(c)

Rs.

Metro/Urban 15 Lac 10 Lac 5 Lac 205 Lac

Semi

Urban/Rural

7.5 Lac 5 Lac 2.5 Lac 1.25 Lac

Category Annual Income

1) Affluent > Rs.10 to Rs.50 Lac/annum

2) Mass Affluent >Rs.2.40 to Rs.10 Lac / annum

Ultra HNI:- Ultra high net worth individuals are those who have at least $1 million in assets (in

Rs. , depending upon the exchange rate ).

15 SBI in NEWS

In last few months


5-May-2011 CN

State Bank of India to consider dividend : The board meeting of State Bank of India will be held on 17 May 2011 to consider and take on record the audited working results of the bank for the year ended 31 March 2011 and to consider declaration of dividend, if any for the financial year 2010-11.

4-May-2011 BS

SBI says freeing up savings rate may not be necessary : The State Bank of India (SBI) has said that deregulation of savings bank deposit rate may not be necessary, especially when the banks are offering options to swipe the savings bank deposits to fixed deposits. The savings bank deposits in banks in the country are already deregulated in a sense, with the swipe system allowing them to convert the deposits to fixed deposit to enjoy the higher rates, said Pratip Chaudhuri, chairman, SBI. While the customers are availing higher interest rates even now on their savings bank deposit accounts with swipe facilities offered by banks, deregulation of the deposit rates may not be necessary, he added. 'We have responded to the RBI that deregulation may not be necessary. But we would go along with the decision of RBI,' said Chaudhuri. The interest rates for savings bank accounts at present are not attractive. Once it is made attractive, around Rs 9 lakh crore of currency available in the economy could be mobilised, he said. There are also chances that with the deregulation, some banks may offer higher rates for deposits in cities and metros while the rural area would not be able to enjoy the benefits. The RBI, at the end of April 2011, released a discussion paper on deregulation of savings bank deposit rate, seeking feedback from banks by May 20. It has pointed out that the deregulation of the savings bank deposit rate, which is at 3.5 per cent, would improve monetary policy transmission. After presiding over a Corporate Social Responsibility (CSR) initiative of SBI by donating Rs 18.5 lakh to The Leprosy Mission Trust India (TLM), he told reporters that with the inflation rate on the higher side, at eight per cent, an increase in interest rates could derail the country's economy. SBI is in the process of absorbing State Bank of Indore, for which the merger process was started in 2010. Chaudhuri said the merger of some of the other five associates could be expected at the earliest by next year, indicating that it was not an urgent matter. It has merged State Bank of Saurashtra in 2008. For its proposed rights issue of Rs 20,000 crore, the bank is in talks with the

http://www.cmlinks.com/sbi/NewsText.asp?Code=1375&period=1101&srno=10125010040



government, since the target is upwards of Rs 10,000 crore.

3-May-2011 FE

Hike in interest rate may derail growth, warns SBI chief: Advocating a balanced outlook on economy, the country's largest commercial bank State Bank of India (SBI) on Monday said that an increase in interest rates may derail the growth prospects of the country.

Right now inflation is something like 8% plus and an increase in already high interest rates can derail the country's growth prospects. It is not easy, but Reserve Bank will be able to do something very optimum from both ends, SBI chairman Pratip Chaudhuri said on Monday.

Commenting on the the deregulation of savings bank deposits, he said, We are not in favour of deregulation, but adequate incentives for saving bank deposits. We will go with RBI. In our view sent to the RBI we have said deregulation may not be necessary.

On its plans to merger with its associate banks, he said, We are still in the process of absorbing State Bank of Indore. Nothing more and nothing beyond this is happening. We are not in pressure or in any urgent need for the merger to happen tomorrow or day after. The need to merge is well established as it will bring is the synergies and brings in deduplication.

On the proposed rights issue, he said they are still holding dialogue with the the government. We are talking to the government because the total amount required as fund is quite substantial. The dialogue is going on. Since we need upwards of R10,000 crore government needs to make sure what will be the source and what will be the modality, he said.

Chaudhuri also said they have set up a new vertical to reduce bad debts. We have created a new vertical — the Stress Asset Management Group. We are using more technology. We are also deploying more resources for recovery of bad debt and also trying to improve the quality of the origination of our loans, he said.

He said the biggest challenge was to take the bank forward and particularly with regard to the financial inclusion plan and supporting the agricultural sector of the country.

29-Apr-2011 ET

India Inc's Top 100 most powerful CEOs 2011 : Ratan Tata has topped the ET-Corporate Dossier ranking of India Inc's Most Powerful CEOs for the third year in a row, with Mukesh Ambani holding on to the second spot. Bharti boss Sunil Mittal has moved from fifth to third position. The survey which



































was conducted by IMRB in January, put Anil Ambani at fifth position, a notch lower than last year. Here is a complete list of the Top 100 most powerful CEOs for 2011. Rank 2011 Name Group Rank 2010 1 Ratan Tata Tata Group 1 2 Mukesh D Ambani Reliance Industries 2 3 Sunil Bharti Mittal Bharti Enterprises 5 4 Azim H Premji Wipro 6 5 Anil D Ambani ADAG 4 6 NR Narayana Murthy Infosys Technologies 3 7 Kumar Mangalam Birla AV Birla Group 7 8 Chanda D Kochhar ICICI Bank 13 9 Vijay Mallya UB Group 10 10 Naveen Jindal Jindal Steel 47 11 Anand G Mahindra Mahindra & Mahindra 9 12 S Gopalakrishnan Infosys 11 13 Aditya Puri HDFC Bank 24 14 O P Bhatt State Bank Of India 12 15 Sajjan Jindal JSW Steel 65 16 A B Godrej Godrej Group 19 17 Rajiv Bajaj Bajaj Auto 30 18 Shiv Nadar HCL 16 19 Deepak S Parekh HDFC 33 20 Uday Kotak Kotak Mahindra 17 21 Pawan Munjal Hero Honda Motors 40 22 Shashikant N Ruia Essar Group 20 23 Sanjiv Goenka RPG Group NA 24 Shikha Sharma Axis Bank 26 25 K R Kamath Punjab National Bank 32 26 Nusli Wadia Wadia Group 52 27 N Chandrasekaran TCS 49 28 Vineet Nayar HCL Technologies 37 29 Venugopal N Dhoot Videocon International 60 30 A M Naik L&T 21 31 Harsh Goenka RPG Group 18 32 Yogesh C Deveshwar ITC 39 33 K P Singh DLF 28 34 Kishore Biyani Future Group 25 35 T S Vijayan LIC 23 36 GP Hinduja Hinduja Group NA 37 Ravikant N Ruia Essar Group 22 38 K Anji Reddy Dr Reddy's Laboratories 76 39 Pramit Jhaveri Citi India NA 40 Naresh Goyal Jet Airways 43 41 Venu Srinivasan TVS Motors 15 42 Anand Burman Dabur 41 43 Gautam Singhania Raymond 35 44 PRS Oberoi East India Hotels 64 45 Ajay G Piramal Piramal Group 56 46 Ravi Venkatesan Microsoft India NA 47 Gautam S Adani Adani Group 61 48 N Srinivasan India Cements NA 49 M D Mallya Bank of Baroda NA 50 G M Rao GMR Group 34 Rank 2011 Name Group Rank 2010 51 H M Nerurkar Tata Steel NA 52 Nitin Paranjpe Hindustan Unilever 58 53 Shanker Annaswamy IBM India NA 54 R S Sharma ONGC 71 55 Malvinder Singh Religare NA 56 Shinzo Nakanishi Maruti Suzuki 46 57 Anil Agarwal Sterlite Group 74 58 P M Murty Asian Paints NA 59 Vinita Bali Britannia Industries 14 60 K M Mammen MRF 72 61 Atul Punj Punj Lloyd 94 62 Bharat Hari Singhania JK tyre NA 63 RM Malla IDBI NA 64 Amitabh Jhunjhunwala Reliance Capital 82 65 D Shivakumar Nokia NA 66 Carl-Peter Forster Tata Motors NA 67 Vineet Nayyar Tech Mahindra 29 68 Arun Sawhney Ranbaxy NA 69 Brij Mohan Bansal Indian Oil Corporation NA 70 C S Verma SAIL NA 71 Bhaskar Bhat Titan Industries NA 72 Gautam Thapar Avantha Group NA 73 S Radhakrishnan Spic Petro NA 74 Debu Bhattacharya


Hindalco 89 75 Dilip S Shanghvi Sun Pharma 73 76 B Prasada Rao BHEL 97 77 V R S Natarajan Bharat Earth Movers NA 78 B C Tripathi GAIL 91 79 N S Sekhsaria Ambuja Cements NA 80 K K Patel Nirma Group 78 81 Y K Hamied Cipla NA 82 Onkar S Kanwar Apollo 95 83 Neeraj Swaroop Standard Chartered 42 84 Rakesh Jain Aditya Birla Nuvo NA 85 R Mukundan Tata Chemicals NA 86 MB Shin LG Electronics NA 87 Ajay S Shriram DCM Shriram NA 88 Analjit Singh Max India 67 89 P R Menon Tata Power 68 90 Alok Kumar Mishra Bank of India NA 91 Ajit Gulabchand HCC NA 92 Meher Pudumjee Thermax 100 93 B N Kalyani Bharat Forge 62 94 Sanjay S Lalbhai Lalbhai Group NA 95 Arup Roy Choudhury NTPC NA 96 Kuldip Singh MTNL NA 97 Habil F Khorakiwala Wockhardt 63 98 Romesh Sobti IndusInd NA 99 Kuldip Kaura ACC NA 100 A Vellayan Murugappa Group NA

27-Apr-2011 ET

SBI rules out merger of affiliates this year : Finance Minister Pranab Mukherjee will review the performance of all public sector banks next month after they announce financial results for 2010-11, a senior official said. We will have a review meeting next month with the finance minister...may be towards the end of May, Department of Financial Services Secretary Sashi Kant Sharma said after meeting the heads of public sector banks and financial institutions. Tuesday's meeting discussed the performance of the banks on the various financial and social parameters set by the finance ministry, Sharma said. It also reviewed the level of financial inclusion achieved by the lenders. The ministry aims to introduce banking services in 73,000 villages across the country in the first phase of the financial inclusion programme. But the Reserve Bank of India's monetary policy actions and interest rates were not discussed at the meeting. Speaking on the sidelines of the meeting, Chairman of State Bank of India Pratip Chaudhuri said interest rates should decline as they have stabilized now. He said the Reserve Bank would strike a balance between controlling inflation and promoting growth in its annual policy review next week. There are other ways to cool market, apart from interest rate hike and the central bank would balance the objectives of controlling inflation and sustaining growth, he said. Chaudhuri said his bank plans to expand its operations in Australia. He said he is hopeful that the bank will launch Rs 20,000-crore rights issue this year.



We are in dialogue with the government, he said. Chaudhuri ruled out the merger of any associate bank with the State Bank this year. We will prefer to merge associate banks where SBI holds 100%, rather than where the holding is less, he said. In the first amalgamation, SBI had merged the State Bank of Saurashtra with itself in 2008. The merger of State Bank of Indore followed in August last year. SBI has five associate banks -- State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Patiala, State Bank of Mysore and State Bank of Hyderabad. Earlier, SBI had informed a parliamentary committee that it plans consolidation of the remaining five associate banks with itself in the next 12-18 months.

27-Apr-2011 BS

SBI may not raise rates immediately, says Chaudhuri : State Bank of India (SBI) Chairman Pratip Chaudhuri today said a rise in policy rates by the Reserve Bank of India (RBI) may not immediately lead to a rise in the bank's interest rates. 'We are not contemplating an immediate rise as of now. If there is a rise of 25 basis points in the monetary policy, it would not hit us immediately...normally, we keep money with RBI. So, if there is a rise, we would be the beneficiary,' he said. He, however, added if the rise exerted upward pressure on the cost of funds, the bank would review its interest rates. The bank also dropped its plans of acquiring a bank in Indonesia and said it would now concentrate on opening a subsidiary in Australia. The bank also plans to merge either State Bank of Patiala or State Bank of Hyderabad with itself by early next year. After a meeting of the chairmen of various public sector units and financial services secretary Shashikant Sharma, Chaudhuri said SBI was in talks with the Centre on an infrastructure debt fund and that the proposal of floating the fund with seed money of Rs 300 crore was quite inadequate. On dropping its acquisition plans in Indonesia, Chaudhuri said, 'Right now, we are not pursuing the Indonesian plan. It is not working out because the prices which we have to pay are very high. It is three times the book value.' SBI had earlier said it was on the look-out to acquire a bank in Indonesia in a cash deal not exceeding $100 million. Chaudhuri also said the bank needed a greater trust on regulatory framework in Indonesia before acquiring a bank. According to Indonesian laws, an acquirer can take over only those banks in which the owner or majority stakeholders exit from the acquired bank completely and the entity is merged. 'Right now, we are right focussing on Australia (through a



subsidiary), because it is a clean market. The capital requirements for a subsidiary are not very stiff,' he said. According to Chaudhuri, unless a bank had a subsidiary, it couldn't mobilise retail funds and acquiring a bank was not logical since it had to spend on premiums. SBI has 125 foreign offices spread across 23 countries including Singapore, USA, Canada and Mauritius. On the merger of its associate banks with SBI, Chaudhuri said two of them were fully owned --- State Bank of Patiala and State Bank of Hyderabad --- and that any one of these would be merged. 'The next bank would possibly be one which is fully owned because it takes some time to digest a bank. May be in a year from now. It may not happen this financial year. However, the preparatory process would start this year. The deal may materialise sometime early next year,' he said. On base rate, he said if SBI kept raising the base rate, it would go against the market trend. 'There is urgency for us to remain competitive,' he said. Currently, SBI's base rate is 8.5 per cent. Chaudhuri defended the discontinuation of teaser rates for home loans, saying RBI had not dilutes its provisioning norms. He asserted his predecessor O P Bhatt would have done the same thing, since the business model had to change under different regulations. 'Bhatt was in SBI and not SBI himself,' he said. The SBI chairman said a rights issue was likely in the current financial year. However, the government would first infuse capital in small banks which required Rs 500 crore or Rs 1,000 crore. Since SBI's rights issue was worth Rs 20,000 crore, the government had to apply for around Rs 12,000 crore to retain its stake of over 59 per cent. On holding companies, Chaudhuri said nowhere in the world did the concept of one holding company for all financial subsidiaries work. However, RBI's thinking was way ahead of the times, he said.

27-Apr-2011 BL

SBI to merge associate banks that it wholly owns : Banking behemoth State Bank of India intends to continue with the consolidation drive within the SBI Group. It would this fiscal initiate steps to gobble up an associate bank fully owned by it. The preference would be to consolidate associate banks where SBI holds 100 per cent, Mr Pratip Chaudhuri, SBI Chairman, told reporters here. The target could be either State Bank of Hyderabad or State Bank of Patiala. Both are 100 per cent owned by SBI.

27-Apr-2011 BL

SBI to continue consolidation drive : Banking behemoth State Bank of India (SBI) intends to continue with the consolidation drive within the SBI Group. It would this fiscal initiate steps to gobble up an associate bank fully owned by it.




The preference would be to consolidate associate banks where SBI holds 100 per cent, Mr Pratip Chaudhuri, SBI Chairman, told reporters here. The target associate bank could be either State Bank of Hyderabad or State Bank of Patiala. Both are 100 per cent owned by SBI. Currently, SBI has five associate banks — State Bank of Hyderabad, State Bank of Travancore, State Bank of Patiala, State Bank of Bikaner and Jaipur and State Bank of Mysore. Last year, SBI had acquired State Bank of Indore. State Bank of Saurashtra was acquired by SBI in 2008. Although SBI is the largest bank in India, it ranks only 68th among the world's largest banks. The Finance Ministry had in November last year told the Parliamentary Standing Committee on Finance that SBI was looking to consolidate all its subsidiary banks with itself in the next 12-18 months. The Finance Ministry had pitched for consolidation, stating that it would be “immensely beneficial” to the SBI Group as it would bring in economies of scale, reduce administrative overheads, help re-deploy and channelise trained manpower to business development. Meanwhile, Mr Chaudhuri said that SBI will come out with a rights issue during the current fiscal. He said that the bank was in discussion with the Government on the proposed rights offering. Indications are that the Government may agree for rights issue size of about Rs 20,000 crore. SBI is also keen to set up/participate in infrastructure debt fund. The guidelines for infrastructure debt funds are yet to be finalised and issued by the Government. Rate hike On whether SBI would hike lending rate if the RBI were to increase policy rates by 25 basis points on May 3, Mr Chaudhuri said that SBI was not contemplating base rate hike for now. He also noted that any such move by the central bank would not hit SBI immediately. Mr Chaudhuri also said that SBI has dropped its plans to acquire a bank in Indonesia. It is, however, looking to open a subsidiary in Australia.

27-Apr-2011 FE More rate hikes unlikely, rights issue this year, says SBI chief : State Bank of India chairman Pratip Chaudhuri said on Tuesday the lender would launch its



R20,000-crore rights issue this year to enhance its capital. SBI is in dialogue with the government on the rights issue, Chaudhuri said after attending a finance ministry meeting to review performance of public sector banks. The government owns 59.4% in the bank and Chaudhuri said SBI would not want the government stake to decline. He also said that the interest rates have stabilised in the market and any decision regarding a rate revision would be taken after the RBI's monetary policy review next Tuesday. He indicated that any further hike in the base rate by SBI was unlikely anytime soon, and that there could be some deceleration in rates going forward. The country's largest lender has also dropped plans to acquire a bank in Indonesia. SBI, under the former chairman OP Bhatt, has been scouting for a potential acquisition target. When asked about the merger of the remaining five associate banks with the SBI, Chaudhuri said the lender was trying to absorb the previous mergers with State Bank of Saurashtra and State Bank of Indore. Among its associates, SBI would first try to merge with itself two banks -- State Bank of Patiala and State Bank of Hyderabad -- that it fully owns, he said, adding that any merger process would only start in the next fiscal year. Next merger should most probably with a bank that is fully owned. The process of the merger would start but may be we will consummate the deal sometime next financial year, Chaudhuri said. The other three listed banks -- State Bank of Bikaner and Jaipur, State Bank of Travancore and State Bank of Mysore -- will be merged later. SBI stock closed up 0.51% at R2,934.30 at the Bombay Stock Exchange on Tuesday. SBI plans consolidation of remaining five associate banks with itself in the next 12-18 months, the finance ministry had said, according a report of the Parliamentary Standing Committee on Finance, in February.

27-Apr-2011 PN

SBI s Rs 20k cr rights issue this year: Chairman : State Bank of India on Tuesday said it will launch its Rs 20,000 crore rights issue this year to augment its lending operation. The bank is in dialogue with the Government and the proposed rights issue should happen this year, SBI Chairman Pratip Chaudhuri said here.



SBI had earlier announced its intention of coming out with the rights issue in the previous fiscal ending March 31, 2011. The Government owns 59.4 per cent in the bank. The bank had raised over Rs 16,000 crore through a rights issue in 2008. When asked about SBIs plan to merge with associate banks, Chaudhuri said, the bank is working on it and will initiate something this year. He said SBI would prefer to merge associate banks where SBI holds 100 per cent, rather than where the holding is less. SBI did first ever amalgamation of its associate State Bank of Saurashtra in 2008, followed by State Bank of Indore in August last year. SBI has five associate banks -- State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Patiala, State Bank of Mysore and State Bank of Hyderabad. SBI plans consolidation of remaining five associate banks with itself in the next 12-18 months, the Finance Ministry had earlier informed a Parliamentary Committee. Among these, the State Banks of Bikaner and Jaipur, State Bank of Mysore and State Bank of Travancore are listed companies. Interest rates have stabilised SBI on Tuesday said interest rates should start declining now as they have stabilised and hoped that RBI would strike a balance between controlling inflation and promoting growth in its annual policy review next week. State Bank of India (SBI) Chairman Pratip Chaudhuri, who was here for the annual performance review meeting of state- run banks with the finance ministry, said interest rates have stabilised and there should be some deceleration from now on. When asked if the Reserve Bank of India (RBI) would hike policy rates by 50 basis points in its annual policy review meeting on May 3, Chaudhuri said there are other ways to cool market, apart from interest rate hike and the central bank would balance the two objectives of controlling inflation and sustaining growth.


The overall inflation, measured on the basis of wholesale prices, stood at 8.98 per cent in March, higher than the 8 per cent projection of the Reserve Bank. To cool inflationary pressures, the central bank has hiked key policy rates eight times since March, 2010. Experts have said RBI is likely to go for another mild hike on May 3 as inflationary pressure still persists. The rate hikes are intended to suck out excess liquidity from the system and tame demand.

27-Apr-2011 TG

State Bank warms up for rights : The State Bank of India today said it would launch its Rs 20,000-crore rights issue this year to boost its lending operations. The bank is in talks with the government and the proposed rights issue should happen this year, SBI chairman Pratip Chaudhuri said. The SBI had earlier announced its intention of coming out with the rights issue in the previous fiscal ended March 31, 2011. The government owns 59.4 per cent in the bank. The bank had raised over Rs 16,000 crore through a rights issue in 2008. On interest rates, Chaudhuri said he expected rates to move downward in the near future and hoped that the RBI would strike a balance between controlling inflation and promoting growth in its annual policy review next week. Interest rates have stabilised and there should be some deceleration from now on, Chaudhuri said. When asked if the Reserve Bank of India would hike policy rates by 50 basis points in its review meeting on May 3, Chaudhuri said there were other ways to cool the market apart from an interest rate hike. Overall inflation, measured on the basis of wholesale prices, stood at 8.98 per cent in March, higher than the 8 per cent projection of the RBI. To cool inflationary pressures, the RBI has hiked key policy rates eight times since March 2010. Experts have said the RBI is likely to go for another mild hike on May 3 as inflationary pressure still persists. The rate hikes are intended to suck out excess liquidity from the system and



tame demand. The repo and reverse repo rates stand at 6.75 per cent and 6.25 per cent, respectively. When asked about the SBIs plan to merge with associate banks, Chaudhuri said the bank was working on it and would initiate some moves this year. He said the SBI would prefer to merge associate banks where the SBI held 100 per cent, rather than where the holding was less. The SBI had amalgamated the State Bank of Saurashtra with itself in 2008 and the State Bank of Indore in August last year.

25-Apr-2011 ET

SBI Bengal Circle opens ATM in Himalayas : SBI Bengal Circle has recorded a landmark achievement by opening an ATM in the lofty peaks of the Himalayas. The country's ATM at the highest point in Sikkim (within the jurisdication of Bengal circle) was inaugurated on MV Narayana, circle development officer, Bengal circle in the presence of Lt. colonel Sharat Chandra, Officating Commanding officer at 317 Army field hospital, Menla on the way to Nathu La Pass.

21-Apr-2011 ET

SBI hikes lending rate by 25 bps; loans get costlier : The State Bank of India has made loans dearer by raising base rate by 25 basis points, ahead of RBI's annual monetary policy review on May 3, when the central bank may raise policy rates to rein in inflation that's well ahead of its forecast. Other banks may follow the leader and keep raising rates for most part of the year as the central bank is likely to raise policy rates to curb demand that's far exceeding the ability of manufacturers to ramp up supply. Standard Chartered has doubled its policy rate increase forecast to 100 basis points this year. A basis point is 0.01 percentage point. SBI's existing home loan borrowers, who are under the dual rate - or teaser rate scheme, are insulated from the rate hike as they pay fixed interest rate for the first three years of the loan. Following this decision, SBI's new base rate will be 8.50% from April 25. It has also increased the benchmark prime lending rate by the same extent to 13.25% a year, from 13% now. Banks use the base rate as the benchmark for all loans since July 2010. Base rate is calculated by taking into account the cost of deposits and the cost of maintaining SLR and CRR. Prior to the advent of the base rate regime, banks used to link lending rates to BPLR. The SBI move has fuelled market speculation that other banks may follow the banking leader immediately, but the likes of Bank of Baroda, Punjab National Bank and Union Bank of India ruled out such a possibility. “SBI was behind the curve. They have partially corrected this now,” a senior bank executive said. Most other banks have their base rate at 9.5% while ICICI Bank has it at




8.75% a year. Union Bank chairman MV Nair said his bank will take a call on interest rates after May 3. “We will wait for the RBI policy,” he said. PNB chief KR Kamath said: “We are watching the market situation and will probably take a decision after the RBI policy. The regulator is expected to intensify it

21-Apr-2011 BS

RCom, SBI tie up for financial services : Reliance Communications, together with State bank of India (SBI) on Wednesday launched Mobile Banking Services. This is aimed at providing various facilities, including balance inquiry, mini statements, fund transfers and cheque book issuances. “This mobile banking service is yet another useful service for our customers. They can now avoid those long queues at SBI branches,” Reliance Communications President (wireless business), Mahesh Prasad, said in a statement. Reliance subscribers would not require any special mobile application or GPRS to use the service. However, they should have an active current or savings account with SBI.

21-Apr-2011 BL

SBI ATM near Nathu La Pass, Sikkim : State Bank of India has set up an ATM in the Himalayan mountain range in Sikkim. The ATM, 18th in Sikkim, is located on its highest point near the Nathu La Pass. The ATM will provide balance enquiry, cash withdrawal, card-to-card transfers, mobile banking registration and credit card payments to Army personnel, adjoining villagers as well as toursts.

21-Apr-2011 FE

SBI withdraws teaser loan scheme : With persistent pressure from the banking regulator Reserve Bank of India, country's largest lender State Bank of India (SBI) on Wednesday announced withdrawal of special home loan schemes, or teaser rates, with effect from May 1. The withdrawal of teaser rates comes within a month of the new chairman Pratip Chaudhuri taking charge at SBI. We changed rates as regulator expressed concern,'' said Chaudhuri. SBI Easy Home Loan and SBI Advantage Home Loan (teaser rate products) will be replaced by floating interest rate schemes on par with other commercial banks. Under the teaser home loan scheme, SBI was offering lower rate of interest of 8-8.5 % for the first three years. It invited severe criticism from RBI, which had said the scheme could impact the asset quality of SBI's home loan portfolio. The home loan from SBI will now attract an interest rate of 9.5% to 10.25% depending upon the loan amount, SBI said. SBI has also launched the SBI Advantage Car loan Scheme, under which credit would be provided at 10.75% for a maximum period of seven years.





Chaudhuri expected 20% growth in home loans during the current financial year.The bank has also withdrawn prepayment penalty on all car and home loans. The change in the interest rate wouldn't hurt spread,'' he said. He said that bank's higher base rate will protect margins. We have to raise rates after deposit rate rose,'' he said.

21-Apr-2011 TE

SBI withdraws teaser home loans : A day after it raised lending rates, State Bank of India has withdrawn its teaser rate home loans and restructured mortgage rates to ensure that they remain the cheapest. The new attraction under the bank's home and car loan schemes is the freedom to refinance or pre-pay the loan any time free of charge. Following the restructuring, loans up to Rs 30 lakh would be available at 9.5% and loans between Rs 30 lakh to Rs 75 lakh at 9.75%. As compared to this, its nearest rival HDFC charges 9.7% and 10% respectively. If the teaser rates were to continue, SBI's loans would have been more expensive than under the revised structure. The teaser rates offered loans at discounted rates in the first three years but in subsequent years they were 1.25% and 1.5% over the base rate while under the revised rate they are only 1% and 1.25% over the base rate. The base rate is the benchmark for all new loans. SBI's former chairman O P Bhatt had stubbornly held until his retirement in March that the step-up rate structure could not be classified as teaser rate because it merely provided value for the customer and did not increase risk. Under Pratip Chaudhuri, who took charge as chairman from this month, SBI has climbed down from its defiant stand in continuing with the step-up structure but has lost none of its aggressiveness in pricing. Chaudhuri indicated that the bank may have to set aside additional Rs 587crore on its teaser loan portfolio if RBI does not grant a waiver. Announcing the new rates, Chaudhuri said: 'In order to continue to deliver best value to our customers, we are changing the interest rate structure which will be compliant with RBI's guidelines on tiered loans but will not result in a higher interest payout for the borrower' Even in car loans, the bank has simplified the lending structure and now offers loans at a flat 10.75% which is a spread of 2.25% over the base rate. 'This works out to an EMI of Rs 1,670 per lakh which is sheer value considering market conditions,' said Chaudhuri. The car loan too can be pre-paid without any charge. Chaudhuri said there was a change in thinking in SBI with regard to pre-



payment charges and there was a feeling that these were seen as hidden costs by customers. 'We want to position ourselves as the most efficient lenders which is why we are giving borrowers the freedom to go to any other lender if they feel they are getting a better deal,' he said. National Housing Bank, which governs housing finance companies like HDFC, bars lenders from imposing pre-payment charges if the loan is repaid from the borrower's own funds. However, lenders are free to impose a charge if the borrower shifts his loan to another lender.

20-Apr-2011 BS

SBI raises base rate by 25 bps : State Bank of India (SBI) has increased its base rate - the reference rate for loans - by 25 basis points (bps) to 8.5 per cent from April 25. The bank has 17 per cent share of the loan market. The increase will make both corporate and retail loans dearer. It will also hit home loan borrowers. From January, SBI has linked its special home loan scheme to the base rate. For loans up to 30 lakh, SBI's home loan customers have to pay 9 per cent in the first year as compared to 8.75 per cent earlier. For second and third years, the rate is 9.75 per cent. SBI, however, will continue to have the lowest base rate among major banks. (See chart). The bank has also raised its benchmark prime lending rate (BPLR) - the erstwhile benchmark for pricing loans - by 25 bps to 13.25 per cent. Banks had absorbed the 25 bps increase in policy rates in March. Now, with the country's largest lender increasing lending rates, others may follow. However, they may wait till the annual review of the monetary policy on May 3. 'The cost of funds is rising, but credit demand is not there, as the first quarter is a lean season. We may wait for the policy review for any decision,' said M Narendra, chairman and managing director, Indian Overseas Bank.

20-Apr-2011 BL

Tata Motors ties up with SBI for dealer financing : Tata Motors said on Tuesday that it has entered into an agreement with the country's largest lender, State Bank of India (SBI), for providing channel financing facilities to its dealers. While both the passenger and commercial vehicle segments will have access to finance, dealers of Tata Motors will now have access to ready upstream finance for their working capital requirements in addition to their existing retail finance arrangements. “SBI ranks as an important retail financier for Tata Motors today and this tie up is a further step to achieve a holistic value chain support which will help the company achieve its growth aspirations,” said a Tata Motors statement. SBI has evolved a new technology platform for achieving benchmark levels of service in inventory funding.




According to SBI, the electronic dealer finance platform will provide best-in-class customer experience to the dealers.

20-Apr-2011 FE

SBI hikes lending rates by 25 bps : Country's largest lender State Bank of India (SBI) said on Tuesday that it has raised both its base and benchmark prime lending rates by 25 basis points with effect from April 25. After the upward revision, SBI's base rate is pegged at 8.50%, while the BPLR is estimated at 13.5%. SBI's move to raise rates will make cost of retail and corporate loans costlier. EMIs for home, including the bank's special home loan scheme, and other loans are also set to rise after 25. However, SBI unlike other banks like Bank of India , Oriental Bank of Commerce (OBC) and Central Bank of India hasn't changed its rates for bulk deposits. This is the fist time that any major bank has raised its lending rates after the Reserve Bank of India (RBI) hiked key -- repo and reverse repo -- rates by 25 basis points in its mid-quarter monetary policy review unveiled on March 17. The central bank had opted for eighth rate hike since March 2010 to rein in inflation. ICICI Bank, second largest commercial bank in the country, said on Tuesday it is keeping watch on the situation and would respond at the right time. Other major government-owned and private sector banks are yet take a call on their lending rates and said they would prefer to wait till the next annual credit and monetary policy to be announced. M Narendra, CMD of Indian Overseas Bank, said that the bank will wait and watch until the next policy before taking any decision on rate front. Being a slack season we don't want to revise lending rates as of now. I believe bulk deposit rates are still slightly higher, Narendra said. Mohan Tanksale, executive director of Punjab National Bank, also said that the bank plans to revise either its base rate at 9.5% or the BPLR at 13%. Rather, we will wait for the RBI policy and credit pick up to take place before we take any decision. Also, we have no plan to revise our deposit rates, he said. BA Prabhakar, ED, Bank of India, said they have no plan to revise either its



base rate (9.5%) or BPLR (13.25%). The bank will wait for the RBI policy, credit expansion to take place before any any decisions on the rate issues. The bank recently moderated its bulk deposit rates, and hence, will not look at further revision. We are not looking at raising lending rates. SBI has done it as in comparison with other PSBs the bank had fixed its lending rates lower, said RM Malla, CMD, IDBI Bank.

20-Apr-2011 IE

Loans to get costlier as largest bank SBI hikes lending rate by 25 bps : Though the Reserve Bank of India's annual monetary policy review is only three weeks away, State Bank of India, the country's largest bank, has announced a hike in its benchmark lending rates by 25 basis points (bps), making home and auto loans from the lender dearer. SBI's benchmark prime lending rate will now rise to 13.25 per cent. The rate hike would be effective from April 25, 2011, the bank said in a statement. After today's rise, SBI's base rate has gone up to 8.50 per cent from 8.25 per cent. SBI's base rate, below which it cannot lend, is still lower than public sector banks, which have set their base rates at around 9 per cent. The base rate of India's largest private sector lender ICICI Bank is 8.75 per cent. The base rate was introduced replacing the Benchmark Prime Lending Rate (BPLR) in July last year to bring in more transparency. The BPLR was used for determining interest rates on loans and advances sanctioned up to June 30, 2010. However, other banks said they would wait until the first week of May to get a clear indication from the annual policy statement of the RBI. We will wait and watch until the RBI policy before we jump for any decision on these rate issues. On the other hand, I believe that bulk deposit rates are still slightly higher and being a slack season, we do not want to revise the lending rates right now, said M Narendra, CMD, Indian Overseas Bank. The RBI raised its lending and borrowing rates by 25 basis points each to 6.75 per cent and 5.75 per cent respectively in its mid-quarter review in March. The central bank is widely expected to hike key policy rates by at least 25 basis points in its annual monetary policy on May 3. We have no plan to revise either our base rate which is at 9.5 per cent now or even the BPLR at 13 per cent. I hope credit offtake to be in place before we take any such decision on the rates. We have no plan to revise our



deposit rates too, said Mohan Tanksale, ED, Punjab National Bank. BA Prabhakar, ED, Bank of India, said, We have no plan to revise either our base rate or even the BPLR. Let the RBI policy come. We have recently moderated our bulk deposit rates and hence we are not looking any further revision in that segment too.

19-Apr-2011 FE

Breather for SBI as RBI seeks clarification on special loans : State Bank of India (SBI) has got a breather on its controversial special home scheme as Reserve Bank of India has asked clarification from the bank. The communication from RBI reached SBI last weekend. We have received communication from RBI seeking clarification on certain issues relating to our special home loan scheme. We will send a reply by this weekend, a senior SBI official said. The SBI had written to the RBI soon after it had raised provisioning amount on teaser home loan scheme to 2% from 0.4% clarifying that the bank's special home loan scheme couldn't be termed as teaser, and hence, the bank didn't have to provide any extra capital. However, RBI hadn't replied to the SBI earlier and the bank has been reviewing and relaunching its scheme after end of every quarter. SBI had conducted a high level meeting under Krishna Kumar, MD of SBI, to review the situation where the bank may have to modify its special home loan scheme. We haven't decided anything on the scheme and it continues as it is, said the official. Meanwhile, sources at.RBI said the central bank may ultimately ask the bank to provide at 2% for its special home loan scheme. Our stand is very clear. Any home loan product having feature of both fixed and floating rates will fall under teaser home loan scheme. SBI product is neither fully fixed nor fully floating. The new customers of SBI are being attracted with low fixed rates but may have to pay higher floating rates afterwards. We don't want to encourage this product,'' sources at RBI said. Soon after taking over as the new chairman of SBI, Pratip Chaudhuri had hinted that the bank's special home loan schemes may be modified since the higher provisioning norms for such assets of 2%, as prescribed by the regulator, were beginning to hurt. We are continuing with the schemes at present. At the same time, we are in dialogue with RBI and will try to address the concerns of the regulator,



deliver value to the customer and also make sure the provisioning is affordable, said Chaudhuri. Chaudhuri's predecessor OP Bhatt, who was instrumental in growing SBI's home loan portfolio with the special home loan scheme, had staunchly defended the product. Reiterating RBI's stance that SBI's special home loans are similar to the sub-prime loans lent in the US in the run-up to the 2008 global financial meltdown, Bhatt said this view is beyond logic as his offering is sold to those who are absolutely credit-worthy.

16-Apr-2011 CN

State Bank of India appoints Diwakar Gupta as CFO : State Bank of India has announced that Diwakar Gupta, managing director, State Bank of India has taken over as the chief financial officer (CFO) of the bank in place of H G Contractor.

13-Apr-2011 ET

SBI chairman Pratip Chaudhuri loves to be the people's person : The soft-spoken chairman of the nation's biggest bank, the State Bank of India, in the very first week of taking office has proved that perceptions and reality can be so different. The one who was branded media-shy exhausted the media in his first interaction, answering questions till reporters ran out of them. Likewise, he may be on course to prove that it may not be difficult to step into the shoes of OP Bhatt as many analysts believe now. But the style of functioning, both internal and external, will change significantly. Mr Chaudhuri is a man manager and promotes people with a vision to expand businesses, unlike Mr Bhatt who relied on his vision on how to run the bank and had his iron hand on every department. Nationwide, there may be more smiles on SBI's premises than before, thanks to Chaudhuri's inclusive approach to HR management. Many in SBI know that they would be rewarded for performance and have the freedom to do whatever they wish to do, if it is helping the bank. Many at SBI say that Mr Chaudhuri gained popularity due to his innovative ways of working around the system to reward excellence. His stint as chief general manager in Chennai is the most talked about. The story goes that he distributed gold coins to those employees who met business targets even if it meant going beyond the laidout structure of rewarding staff at the bank. Apart from being a generous boss, Mr Chaudhuri turned around the gold loan business in a city which was dominated by local trading community of chettiyars and marwari lenders. Many say even as he appears unassuming, one would realise the aggression in him only while cutting a business deal.




Being the peoples' person that he is, Mr Chaudhuri was entrusted with the job of State Bank of Saurashtra merger with the parent bank. Being a subsidiary of SBI, the only critical task of this exercise was the integration of 5,000-6,000 people with the bank, which Mr Chaudhuri seamlessly managed. Managing a few thousand people in a region may be different from running an institution with more than two lakh staff from different regions. What he will have on hand is a balance sheet of 14,51,219.8 crore, 14,000 branches, five associate banks, 150 overseas offices, and numerous finance subsidiaries. Add to this, a plethora of public relations exercise he has to indulge in like addressing seminars and conferences, and lobbying on behalf of the industry and the bank itself with regulators and the government. And he has just two-and-a-half years to fulfil his dreams. Having spent a good time of his career in New Delhi, he knows his way around the corridors of power, the most important ingredient of success at a state-run bank, than the knowledge of banking itself. Mr Chaudhuri started his career at SBI as a probationary officer in 1974 after completing his MBA. He headed international operations till recently. His biggest challenge would be to make peace with the RBI. Sharp differences had emerged between the former SBI chief and the RBI on teaser loans. SBI has refrained from making provisions on the ground that these loans are given after proper due diligence, something that may have not gone down well with the RBI. We will have a dialogue with the RBI. We will see if there has to be a compromise, or it can co exist, Mr Chaudhuri has said. he has a liking for old Hindi songs like many of his generation that grew up listening to the melodies of Kishore Kumar and Mukesh. When colleagues asked him what tilted the scales in his favour for the top job over colleague Hemant Contractor, who began service the same day more than three and a half decades ago, he sang, Yeh kya hua, keise hua, kab hua kyon hua, jab hua tab hua, o choda yeh na pucho.

11-Apr-2011 BL

Management by consensus' is SBI chief's style of functioning : Down-to-earth and carries his team along” is how senior SBI officials describe their new Chairman, Mr Pratip Chaudhuri. These two facets of his personality shone through in his preliminary remarks at his first media interaction last Friday after he took charge the previous day. Collective leadership



“We thought that we will strike a balance between continuity, not making too far-reaching changes, and also entrusting senior executives with significant, meaningful roles which have an important bearing on the bank's overall functioning…With this, we present the collective leadership face of SBI. I would like to confess that I may not have the full and detailed understanding of all the facets and all the subdivisions of the bank. So, here we are, all together, able colleagues, ready to answer all your questions,” said Mr Chaudhuri. The new SBI chief, who joined the bank as a probationary officer in 1974, is also known as a people's man. This is borne out by the fact that while referring to SBI as a people intensive bank, he said, “We will be careful and quite considerate that our 200,000-plus colleagues feel that they are all part of this great journey and adequate attention will be paid to them.” While his predecessor Mr O. P. Bhatt was known to speak his mind, Mr Chaudhuri is diplomatic in his communication. The new SBI chief will try to find the middle ground for internal and external challenges and is unlikely to ruffle feathers of stakeholders, especially of the ‘regulatory kind', say officials. Will take on the challenges The nearly one-and-a-half hour interaction saw the new Chairman and his top team readily answer a volley of questions on the challenges facing India's biggest lender, be they on non-performing assets (the bank has seen some acceleration), the much debated ‘special home loans scheme', market-share and profitability, overseas acquisitions/ expansion, merger of associate banks or revitalising the savings bank account. In his two-and-a-half-years stint at the helm, the mild-mannered SBI chief will tackle all the aforementioned challenges head-on, say his colleagues. “The new Chairman will be as dogged in his pursuit of growth as his predecessor. He will not ease off on the growth pedal,” said a senior SBI official. Known for ‘management by consensus' style of functioning, Mr Chaudhuri held several key positions in SBI in a career spanning 37 years. He was one of the key architects to effect the merger of the erstwhile State Bank of Saurashtra with its parent, SBI.


Before being catapulted to the Chairman's hot seat, Mr Chaudhuri was Deputy Managing Director (International Banking).

10-Apr-2011 ET

Focus on cutting NPAs; teaser rates to continue: Pratip Chaudhuri : State Bank of India's (SBI) priority will be to reduce bad loans under new chairman Pratip Chaudhuri , even as it aims to increase the share of term loans in its portfolio to improve profitability. The overall loans and deposits growth, which was lagging behind the industry , will also get the attention of the new chief who steps into the shoes of Om Prakash Bhatt, credited with shaking the slumber off SBI. Restoration of a normal relationship with the RBI is also on top of Chaudhari's agenda, after his predecessor in his aggression to take home loans to the lower middle class, ruffled a few feathers at the regulator. No stone will be left unturned to expand the market share of the nation's already largest bank with nearly a fifth of the industry, when new licences for banks will be given away in the next few months. Growth will face challenges, Chaudhuri, who took charge as the chairman of SBI on Thursday, told reporters in his first media interaction . There will be stresses like non-performing assets which will be one of our focus areas. We will look at NPAs that are appropriate for SBI. There has been an acceleration of NPAs, which we will try and bring down to market levels. SBI's gross bad loans are at 3.17% against an industry average of 2.5% as estimated by ratings firm Crisil. Its long-term loans that earn higher rates are about half of total. Chaudhuri, unseen in public so far, will have two-and-a-half years at the corner office on the 18th floor at SBI Building in Mumbai to prove that he could match the charisma and abilities of Bhatt who was also admired for his plain speaking. Chaudhuri, a State banker since a year before the National Emergency in 1975 under Indira Gandhi, does not believe in protecting the turf with obstacles for new entrants. We welcome more competition and participants in the banking business, said Chaudhuri. We are not in favour of entry barriers . Teaser rates will continue under Chaudhuri, but after working out some compromise with the regulator.

9-Apr-2011 BS

New chairman lays out sbi's priority list : State Bank of India (SBI) would try to increase its market share in deposits and loans, without taking a hit on its margins and profitability, said Pratip Chaudhuri, the bank's new chairman. 'There would not be a significant shift in gear. But we would like to reassess business areas in which the bank experienced stress (non-performing assets).




The bank has a strong presence in corporate banking and has significant presence in retail. We would increase the retail loan book to improve our leadership,' Chaudhuri, who took charge of SBI yesterday, said. The pace of SBI's growth -- loans and deposits -- had slowed in 2010-11, compared to its peers. However, in 2011-12, SBI would aim to record a growth that would be higher than the industry average. 'If the industry grows at 20-21 per cent, we would like to grow by 24 per cent,' Chaudhuri said. He said low-cost deposits were high. However, retail deposit mobilisation had lost steam and the bank would try to correct that by strengthening the branches, especially the new ones, by having more trained persons in those branches. SBI would also take various steps to increase interest income and would focus on term loans -- for both corporate and retail. The bank would also try to focus on long-term credit and reduce its dependence on short-term loans. 'In our anxiety to grow, we were more active on working capital loans. Now, we would focus harder on term loans,' Chaudhuri said. On increasing international business, Chaudhuri said SBI would like to follow Infosys' mantra of focusing on acquisitions that bring value. The bank would open more branches and look at acquisitions in countries with high India-related trade and capital flows. On the challenges ahead, Chaudhuri said non-performing assets had recently grown. 'There is a need to control it,' he said. Chaudhuri said the bank would hold talks with the Reserve Bank of India on teaser loans. 'The bank would not want to breach regulatory prescriptions. It had provided a provision of 0.4 per cent, which was bearable. But two per cent prescription for provisioning is tough,' he said. Rights issue 'Last year, there were pressing needs from other banks for recapitalisation. Our rights issue would be of a significant amount. The government is convinced of SBI's capital needs. It remains our top priority,' Chaudhuri said. SBI had earlier said it would need around 20,000 crore to fund growth for the next five years. The bank had sought the finance ministry's approval for a rights issue of shares to raise the amount. favour new players' Chaudhuri said he was in favour of opening the banking sector to new players. 'The Indian banking system is fragmented. We have lived and grown with competition. We are not in favour of entry barriers and welcome more participants,' Chaudhuri said.

9-Apr-2011 BL

SBI will continue with teaser loans: New chief : State Bank of India will

continue with the special home loan scheme

“as it has helped millions of people to buy homes and also helped it

to achieve leadership position in home loans,” the bank's new

Chairman, Mr Pratip Chaudhuri, said.

This statement comes in the backdrop of the former Chairman, Mr O.P.



Bhatt's comments late last month that the central bank had not understood the home loan product, whereby interest rates are pegged lower in the first few years and re-set to the prevailing rate thereafter.

The RBI has cautioned that ‘teaser loans' raise concern as some borrowers may find it difficult to service the loans once the normal interest rate becomes effective.

“For now we have taken a decision that we will continue with the special home loan scheme. However, we will keep reviewing it. If we feel that we need to revise/ modify then we will take a decision,” said Mr Hemant Contractor, Managing Director.

The regulatory stance is that if home loan pricing is structured in such a manner then that would perhaps attract provisioning requirement, Mr Chaudhuri said.

“On this we will have a dialogue with the RBI and the final course that we will adopt would be a compromise of and recognise both the objective of delivering value to home owners, not to raise their cost of borrowing and to sufficiently address the concerns of the regulators and to satisfy them that we do not want to be in breach of the regulatory prescription,” said the Chairman.

9-Apr-2011 BL

The men at the helm: Mr R. Sridharan represents the continuity on the board among the whole-time directors and continues to hold the portfolio of MD (Associates & Subsidiaries). The portfolios of the three new MDs are: Mr Hemant Contractor (International Banking Business); Mr A Krishna Kumar (National Banking Group); and Mr Diwakar Gupta (Chief Finance Officer). Our corporate banking function needs more one-to-one contact with the companies. Looking the bank's large portfolio, it would be difficult for one individual to do justice to this function. So, this portfolio has been split among two deputy managing directors: Mr Santosh Nayar (Large Corporate Banking) and Mr Shyamal Acharya (Mid-Corporate Banking). This is a blend of continuity and also time to revamp the management structure as and when the opportunities arise. This is the collective leadership face of SBI, said Mr Chaudhuri.

9-Apr-2011 FE SBI aims for top slot in retail space : State Bank of India (SBI) aims to become the market leader in the retail lending space chairman Pratip Chaudhuri said on Friday. We were never the leaders in the retail segment but have been




catapulted to among the top players and would like to consolidate our position to become bigger, Chaudhuri said at his first press conference after taking over from the erstwhile chairman OP Bhatt, on Thursday evening. The chairman hopes to retain SBI's status as the biggest corporate lender which is evident from the fact that the corporate banking portfolio will now be supervised by two deputy managing directors. Chaudhuri observed that there would be no significant 'shifting of gears' and that bank would 'consolidate our growth both in the corporate and retail spaces. Our loan growth in 2010-11 has been in line with that of the industry or slightly lower and we need to regain our leadership, the chairman said adding that the bank's retail network would continue to be expanded. The chairman hinted that the bank's special home loan schemes may be modified since the higher provisioning norms for such assets of 2%, as prescribed by the regulator, were beginning to hurt. We are continuing with the schemes for the present. At the same time, we are in dialogue with the Reserve Bank of India and will try to address the concerns of the regulator, deliver value to the customer and also make sure the provisioning is affordable, Chaudhuri said. The SBI chairman also observed that the bank needed to ensure that non-performing assets are brought down to appropriate levels. We can't say there are no challenges and we need to focus on some of the stress areas and make sure that our npas are better than the industry's he said. The bank has decided to take fresh exposure to the telecom sector to the extent of Rs 1000 crore, the chairman said saying it was a sunrise sector. On allowing large industrial houses in the banking space, Chaudhuri said the bank welcomed competition. We are not in favour of entry barriers, we have lived with competition. Let there be as many players. Chaudhuri was confident that the government would give the bank the go ahead for the proposed rights issue. The government is convinced of the bank's need for capital but there have been several other banks whose requirements needed to be met. We believe the amount raised needs to be substantial and we believe SBI will receive its adequate share, the chairman asserted.


The chairman observed that the bank would gradually be replacing its high cost deposits with low cost deposits and justified the issue of retail bonds at high coupon rates saying the bank had not overpaid. The bonds also qualify as capital, he explained adding that a premium of 400 basis points or 25 basis points annualised.We would have been disappointed if they had been trading at a discount, he said saying the retail issue had proved to be a game changer for the bond market. Hemant Contractor, managing director, SBI observed that the bank would attempt to grow its top line and bring down interest costs so as to improve its margins. He said the bank would like to increase the tenor of the loans because they resulted in better yields. State Bank of India chairman said the merger of the associate banks with State Bank would continue pointing out that the consolidation was creating both value and synergies. Chaudhuri said SBI would prefer to set up a subsidiary in a foreign country rather than overpay for acquisitions.

9-Apr-2011 TE

SBI gets new A-team led by Chaudhuri : State Bank of India on Thursday got a new top management with Pratip Chaudhuri, a 36-year veteran of the bank, appointed the new chairman of the country's largest lender, along with three new managing directors-Hemant Contractor, Diwakar Gupta and A Krishna Kumar. All four were so far deputy managing directors at SBI. While Chaudhuri was in-charge of international banking, Contractor was the bank's CFO, Gupta handled national banking and Krishna Kumar was responsible for deployment of information technology. This is the first time that SBI, which accounts for nearly a quarter of the banking business in the country, will have four managing directors, taking the number of executive directors on the bank's board to five. R Sridharan, the senior-most MD, is due to superannuate at the end of June and the government will soon find a replacement for him. Following the new appointments, there will be a reshuffle in the bank's operations, which includes 15,000 branches and 25,000 ATMs, as the structure was so far attuned to having two managing directors. The new team is expected to focus on continuing the growth path charted over the last five years, which includes a strong focus on retail lending and deposit mobilization. Increasingly, SBI is seen to be lowering its reliance on bulk deposits from corporate houses, which are not just high-cost but also



less sticky compared to retail deposits. The strategy is also expected to help the bank improve its margin, which during the December quarter was estimated at 3.4%. Though the pace of growth of gross non-performing assets has slowed down, the bank's provision coverage ratio was at 64% at the end of December compared to RBI-prescribed 70%. Human resources are another focus area given the bank's expansion plans and large number of retirements. But bank executives say that this should not be a tough task since the four have been part of the senior management for at least two years.

9-Apr-2011 DH

Managing NPAs to be new SBI chief s priority : State Bank of India (SBI) has undergone a complete overhaul of its top management with Pratip Chaudhuri taking over as the new Chairman from his illustrious predecessor OP Bhat. Briefing reporters, after becoming SBI Chairman, here this evening Chaudhuri said he would like to expand and consolidate the corporate banking business. At the same time, the new SBI chief said the deposit taking business remains core to the bank and will continue as such. Chaudhuri also emphasised on the use of technology to better the banking experience. We will continue expansion via global opportunities,' he said adding, 'Maintaining NPAs at low, manageable levels will be key focus area. On his predecessors work, Chaudhuri said, there is need to take forward expansion initiatives generated by Bhatt. He said, OP Bhatt was a very capable leader and SBI was fortunate to have been led by him. On the challenges ahead, Chaudhuri said, NPAs have been accelerating of late. 'There is a need to control it,' he stated. He also said the bank will need to bolster international branches for optimum efficiency. He said SBI's aim will be to position itself as a retail banking leader. 'We need to take corrective measures to boost topline growth,' he said. On teaser loans, Chaudhari said, We will speak to the RBI on teaser loans as RBI feels that teaser loans can be risky. We will have to reconcile a bit without compromiksing on delivering value to home loan borrowers. Chaudhury said he would like to increase average tenure of loans since getting returns from short-term loan market is very difficult. On loans and exposure to telecom companies, he said: We (at SBI) consider telcos a sunrise industry but take decisions diligently. Further, he said banks have no qualms in extending loans to telcos, it is only telcos who perceive



that banks were more aggressive in giving loans to other sectors like infrastructure as compared to them.

9-Apr-2011 IE

New chief wants SBI to be retail banking leader : State Bank of India's new chairman Pratip Chaudhuri on Friday set his agenda for the largest commercial bank in the country, promising to consolidate the trailblazing gains made during the five-year tenure of former chairman OP Bhatt. Chaudhuri vowed to bring down bad loans and do a balancing act on the teaser home loan issue. We will consolidate the gains made during the tenure of Mr Bhatt. Now that we have been catapulted to the leadership position, we would like to consolidate the operations. Deposit taking would remain as important. Technology would be high priority and international operations will continue expansion. We would also bring down non-performing assets (NPAs) to appropriate levels, Chaudhuri said after chairing the first board meeting of the bank. SBI's aim will be to position itself as a retail banking leader. We need to take corrective measures to boost topline growth, he said. Bhatt had taken SBI to greater heights through his aggressive moves on the retail front, especially home loans. The growth so far in deposits and advances is close to industry averages. We want to better that, he said. On his predecessor Bhatt's work, Chaudhuri, 57, said, there is need to take forward expansion initiatives generated by Bhatt. He was a very capable leader and SBI was fortunate to have been led by him. On the bank's controversial teaser loans, he said the bank will engage with the central bank to lower the higher-than-comfortable provisioning requirement. The current provisioning requirement of 2 per cent (on teaser loans) is a bit difficult for the bank when compared with the earlier 0.40 per cent, Chaudhuri said, and added it will engage with the central bank to solve the issue, as it does not want to take a belligerent stance against the regulator. The current product offers enormous value to the customers, it has helped millions to own homes as a final settlement we would like to have something which delivers value to the customers and also takes care of the regulatory concerns, he said. On acquisitions, he said, Infosys policy will be our mantra. We won't go for takeover for the sake of it. We will do it if the acquisition adds value to the bank. Prior to taking over as SBI's chairman, Chaudhuri was its Dy MD



(International Banking Group). During his tenure of 37 years in SBI, Chaudhuri has held a number of important positions, including those of chief GM (Foreign Offices), chief GM of Chennai Circle and GM (Mid-Corporate Group).

8-Apr-2011 BS

Chaudhuri takes charge as SBI chief : Ending the uncertainty over senior appointments at State Bank of India (SBI), Pratip Chaudhuri today took over the chairmanship of the country's largest lender. Chaudhuri succeeds managing director R Sridharan, who was the acting chairman after O P Bhatt retired on March 31. The government also issued notifications for the appointments of Diwakar Gupta, A Krishna Kumar and Hemant Contractor as managing directors. While Chaudhuri would be at the helm of affairs at SBI for two and a half years (he would retire in September 2013), Gupta's term would end in July 2013. A Krishna Kumar would enjoy the longest tenure till, November, 2014, while Contractor's would end in April 2014. Before taking over as chairman, Chaudhuri was deputy managing director, in charge of international operations. The immediate task for Chaudhari and the three new managing directors would be to finalise the bank's balance sheet for 2010-11. A senior SBI official said Chaudhuri had already stated his priorities to his colleagues. These include improving the net interest margin, getting rid of orgainsational weaknesses, stemming attrition at entry levels and improve lending to agriculture.

8-Apr-2011 BL

Pratip Chaudhuri is new SBI chief : Mr Pratip Chaudhuri has been appointed as the Chairman of State Bank of India. Prior to his appointment, Mr Chaudhuri was Deputy Managing Director and Group Executive (International Banking). As per a government notification, he will be at the helm at SBI till September 2013. The Government has also elevated Mr Hemant Contractor, Mr Diwakar Gupta and Mr A. Krishna Kumar as Managing Directors of SBI.

6-Apr-2011 ET

SBI bonds: Retail investors sell papers to brokers and finance firms : Brokers

have made a killing by selling SBI retail bonds to provident funds. As was

evident from huge trading volumes on the first day, retail investors who

were allotted the bonds were quick to sell the papers to brokers and finance

firms controlled by brokers. This was part of a deal where retail investors lent

their demat accounts and agreed to sell the papers at a price decided well in

advance.

SBI bonds are always sought-after and the interest return on the security makes it irresistible for PFs as well as some of the insurance companies. Since the retail portion of the SBI issue promised a higher return, brokers





took advantage of the situation by cutting deals with small investors.

At the end of the day, one wonders whether it made sense for the SBI. Perhaps, one can argue it's a way to kickstart retail interest in bonds. But most of the retail investors were hardly the 'buy and hold' variety.

2-Apr-2011 BL

SBI opens new branch, ATM : The State Bank of India inaugurated its 9,000th branch in Orissa and the 25,000th ATM of the State Bank group at Girgon, Mumbai. This branch is under the rural/semi urban category, said a press release issued by the bank. The former SBI Chairman, Mr O. P. Bhatt, inaugurated the branch and ATM through video conference in the bank's corporate center, Mumabi. Speaking at the inauguration, Mr Bhatt said that SBI will have 1,00,000 ATMs after five to six years. Ms Shyamala Gopinath, Deputy Governor, Reserve Bank of India, was also present at the inauguration.

1-Apr-2011 BS

SBI extends teaser home loan scheme by a month : State Bank of India (SBI) has extended its teaser rate' home loan scheme -- a popular, yet controversial product -- by a month. The home loan scheme offers a discount in the interest rate for the first three years. The interest rate structure of the scheme remains unchanged, said a top SBI official. For the first year, the interest rate for loans up to 30 lakh is 100 basis points lower than the card rate, or 8.75 per cent, since the card rate is 150 basis points plus the base rate. The bank's base rate is 8.25 per cent, and the home loan rates will change whenever this is revised. In the second and third year, the effective interest rate is 9.5 per cent or 25 bps discount over the card rate. For the fourth year onwards, the discount is withdrawn. The teaser rate scheme, launched by SBI in February 2009, was extended several times as it has helped the bank to increase its market share. In December last year, the scheme was tweaked with a fixed discount offered instead of a fixed rate. SBI had decided to offer the revised scheme till March 31. It had a home loan portfolio of nearly 83,000 crore, as on December 31, which had registered a growth of 22.5 per cent over a year. The average home loan size is 12 lakh. 'The scheme will be offered till the monetary policy review of RBI or till the bank reviews its annual accounts, whichever is earlier,' said a bank official. The RBI review is scheduled on May 3, while SBI's review is likely only in the second week of May. The Reserve Bank of India (RBI), however, is not comfortable with banks offering such a product. It had increased the standard provisioning requirement for such schemes by five times to two per cent. SBI had requested RBI to waive the additional requirement, but may have to make 300 crore extra provisioning if RBI insists, SBI Chairman O P Bhatt had said yesterday.

1-Apr-2011 BS Sridharan named acting chairman : The Union government has appointed R





Sridharan, managing director of State Bank of India (SBI), as acting chairman. O P Bhatt retired from service today after a five-year tenure as chairman. Sridharan, whose tenure in the bank is supposed to conclude in another four months, will not have financial decision-making powers. Nor is he eligible to be appointed as the successor to Bhatt, since the eligibility rules require at least two years of residual service. Sridharan was appointed MD in December 2008 and was looking after associate banks and subsidiaries. He is a Madras University graduate and joined as a probationary officer in 1972. Before taking over as MD, Sridharan was deputy MD, looking after the non-banking subsidiaries. Earlier, he was MD and CEO of SBI Capital Markets, a subsidiary of SBI. A search panel to select the new chairman had interviewed four Deputy MDs -- Hemant Contractor, Pratip Chaudhury, Diwakar Gupta and A Krishna Kumar. SBI has two MD posts sanctioned, but the other one, S K Bhattacharyya, retired in October and the government is yet to finalise a replacement for him. With a recent amendment to the SBI Act, a provision has been created for having four MDs. The government is still in talks with the bank on possible domains for all. There have been past instances when SBI was headed by an acting chairman. In 2006, when A K Purwar retired, T S Bhattacharya, one of the MDs, was given interim charge.

1-Apr-2011 BL

SBI to rope in foreign consultant to assist in wealth management biz : In its second coming into the wealth management space, State Bank of India intends to rope in an international consultant. The business would be done through a separate company, which may be either a wholly-owned subsidiary or a joint venture, Mr Rajeev N. Mehra, General Manager – Financial Planning and Wealth Management, SBI, told Business Line on Wednesday. More careful now The customer relationship manager-driven model did not quite work in this business when SBI dabbled with it for the first time. This time around, the bank is more careful. On the one hand, assistance of an international consultant is being sought. On the other, the bank has pressed into service trained hands — a dedicated group of 200 employees who have been formed into 50 teams spanning across 41 centres in the country. Late entry



Mr Mehra does not believe that SBI's late entry into this business is any handicap. While the incumbents typically service the very-high-net-worth individuals, SBI will target the “middle level” — the “mass affluent” who might have bank deposits of between Rs 5 lakh and Rs 10 lakh. SBI offers off-the-shelf products, such as one that would aim to reach a targeted sum in a specified number of years, useful for, say, a son's higher education or building a ‘retirement kitty'.

1-Apr-2011 CN

R Sridharan takes additional charge as chairman of SBI : State Bank of India has announced that consequent to O P Bhatt, chairman reaching superannuation, the Government of India, vide its letter dated 31 March 2011 has entrusted R Sridharan, managing director with additional charge as chairman, SBI until further orders.

31-Mar-2011 ET

The 5 yrs that transformed State Bank of India : OP Bhatt will be most remembered for SBI's rights issue of Rs 20,000 crore, coupled with employee stock purchase scheme that no other PSU bank had ventured into. Besides, the bank also raised equity capital in 2008 when companies such as Wockhardt Hospitals and Emaar MGF pulled out their IPOs. It was a proof of shareholder faith in him. Associates Mergers The merger of SBI's associate banks with the parent was talked about since mid-nineties when McKinsey first suggested it. Mr Bhatt recognised the need to build a huge organisation without working at cross purposes. Fortunately for Mr Bhatt, his predecessor, AK Purwar had set the ball rolling by creating a platform for mergers. Mr Purwar ensured a common technology platform and systems and procedures at SBI and its associate banks. Mr Bhatt took it forward. He pushed merger of State Bank of Saurashtra with SBI at a time when the ruling party had a coalition with the conservative Left. Controversies SBI's 8% fixed rate home loan scheme, in response to global crisis, gained enormous attention. Although, arch rival and HDFC chief, Deepak Parekh was quick to term it as a gimmick. Its humongous success forced rivals to launch similar schemes, which offered fixed rate in initial years and floating rate for the remaining term of the loan. RBI's then deputy governor Usha Thorat expressed concerns over such loans,




calling them teaser loans. In response, most home loan providers decided to withdraw such schemes from the market, except SBI. To make a strong case, RBI asked banks to set aside higher capital on such loans, probably to dissuade banks from offering such loans. Mr Bhatt, who felt that the bank's special loans can no way be called teaser scheme, declined to make any provisions for such loans. There is total transparency on it, said Mr Bhatt. The customer is not taken by surprise. On the risk side, the eligibility is considered based on the highest interest charged at the time of giving loan. Neither is there opacity, nor is there risk. Mr Bhatt, in fact, felt SBI was not given due credit. We brought the home loan market back. Lakhs of people own their homes because we kept rates down. It pushed up the economy. But this is something that is not recognised by many. But RBI remains worried about it - possibly relating it to the US sub-prime crisis that sank the global financial system. Some of us have a strong apprehension that the motivation for introducing teaser loans was not product innovation, but to deprive existing floating rate home loan borrowers from the full benefit of declining interest rates, based on market realities, KC Chakrabarty, deputy governor at RBI, said in a recent interview. A number of existing home loan borrowers did not get the benefit of lower interest rate. His another clash with the regulator was when he guaranteed bonds of Tata Steel worth Rs 4,200 crore. RBI claimed that regulations do not allow banks to guarantee corporate bonds, while SBI stood by its client - the Tata Group, which was unable to raise funds for the Corus Group purchase. Disputes with RBI does not seem to cease. The banking regulator downgraded SBI by one notch to B- on grounds that the bank has made lower-than-required provisions for bad loans. The rating, which is highly confidential and is not made public, had upset Mr Bhatt, who recently made a case to RBI to review its rating. The biggest challenge for his successor would be to retain the aggressive brand that Mr Bhatt has created for the once sleepy bank.

31-Mar-2011 ET

State Bank of India: Life in the times of OP Bhatt : Om Prakash Bhatt made an elephant dance when those dancing for decades were falling all around. He made central bank governor Yaga Venugopal Reddy squirm, and rival bankers fume. In a world that believed that those with aggression written on their foreheads and a masters in business administration alone could win, Mr



Bhatt proved that docile state bankers also have winners among them, may be just a handful, but they are still there. The outgoing chairman of the State Bank of India, who read Geoffrey Chaucer and Samuel Johnson to secure his post-graduation, had also rubbed the regulators on the wrong side in his eagerness to strengthen the throne left by the Britishers. When Mr Bhatt demits office on Thursday after five years at the corner office on the 18th floor of the SBI building in Nariman Point, Mumbai, the question that was there when he took charge in July 2006 - is SBI equipped to face the fast-paced future - will rear its head again. But few would dispute that Mr Bhatt answered it. During his tenure, SBI has convincingly re-established its leadership in every segment of banking in India, says Shikha Sharma, managing director and chief executive at Axis Bank. A rival saying that SBI 're-established' its lead is probably the best stamp of appreciation that Mr Bhatt, a post graduate in literature, would carry into his retirement when he may pick up Charles Dickens and William Shakespeare again at leisure. He declined an exit interview request. Loans and deposits grew more than five-fold during his tenure when he spread the blue & green branding of SBI ATM to remote locations of the nation, especially, the states from where the finance ministers hailed - Tamil Nadu and West Bengal. That was when other state-run banks had a sedate growth and private banks were crippled by the credit crisis. What made Mr Bhatt a different banker? - His straight from the shoulder speech. Hardly any CEO would display in powerpoint presentations the graphs depicting how his company was losing. Mr Bhatt did it. When Mr Chidambaram talks about containing rates, Dr Reddy speaks about inflation. When the finance minister talks about growth, the governor speaks about asset bubbles. As bankers, we don't know which way to look. That was Bhatt sometime in September 2006. Not many before spoke that truth in public, though well known. It is a fair guess that few will do so in the future. Mr Bhatt was clear about his mission when he said in his first interaction that he is a no nonsense chairman. Regaining market share is a priority for the bank, rather than expanding overseas, Mr Bhatt said, when talking about 'global acquisition' was the order of the day. We are a big bank and I want it to be a great bank with improvement in efficiency and quality of service to customers. The milling crowd in front of SBI's branches to buy its retail bonds last month


and moaning from investors that it did not sell those bonds in enough locations are a testimony to its popularity. The ability to bring change in such a large and complex organisation is indeed a great achievement, says Chanda Kochhar, CEO at ICICI Bank, the second-largest bank that revolutionised retail lending in India. He set stiff targets - be it deposits or customer service. But also motivated staff with his SBI Parivartan, meaning change, and for officers, Udaan, flying. His acumen did not stop with opening branches in the state of the finance minister, but extended to forging partnerships and extending the revenue generating opportunities. SBI tied up with Insurance Australia Group for non-life insurance. It has a venture with Australia's Macquairie for private-equity business. It also tied up with Societe Generale to provide custodial service. It bought a majority stake in Global Trade Finance (GTL). The company was later merged with SBI Factors to form the largest factoring company, SBI Global Factors. More than half of Mr Bhatt's success may be due to his ability, but the rest is owed to Richard Fuld, chief executive of Lehman Brothers that went bankrupt and Citigroup's former CEO Charles O Prince who was 'dancing' till a few weeks before the crisis exploded on his face. He was taking on more than a thousand crore of deposits a day as panicky customers came away from private banks in droves. SBI offered higher interest rate and its market share rose 24.4% in December. The mistake was that it continued to offer higher rates even after the global crisis. It was saddled with huge liquidity, while demand for loans fell, dragging down its profitability. SBI had to cut deposits and its market share fell to 22%, back to where it was when Mr Bhatt had taken charge. Stockholders, borrowers, depositors and some insiders may have all good words about Mr Bhatt, but he has stepped on the toes of many during his tenure. For some of SBI staff, he was a bully with a dictatorial attitude as he went on achieving what he had aimed for. Whenever it is a one man show, cracks begin to develop when they leave, said an SBI official, who did not want to be identified. There was hardly anyone who could speak publicly at the SBI during Mr Bhatt's time like the way he spoke about central bankers or some people in the government. But it would not matter much when the numbers are speaking a positive trend. Mr Bhatt who has had good times at SBI for


more than three decades is also known for his articulation. One of his favourites used to be, all bad loans are made in good times.

31-Mar-2011 ET

SBI's OP Bhatt against freeing up of savings rate : The State Bank of India's outgoing chairman Om Prakash Bhatt joined former RBI governor YV Reddy, credited with saving the Indian financial system, in speaking against freeing up of savings deposit rates as it may defeat the very goal of financial inclusion and expose the poor to be cheated by banks. It has done well for a large number of depositors who cannot have recurring deposits, Mr Bhatt, whose bank controls a fifth of the deposits, said at his farewell press conference. There are four million people in this country who earn less than 50 a day and save about 30 or 40 a day and they can save the money in the form of fixed deposits or recurring deposits, he said. Some of the government organisations may also be at the receiving end, if rates are liberalised. There are large numbers of government organisations who cannot keep money in fixed deposits and so if they keep it in savings deposits they get some money out of it, he said. RBI governor D Subbarao has set up a committee to study the consequences of freeing up of savings rate which is mandated at 3.5% a year now. All interest rates except rates on savings accounts are free now. Mr Bhatt is not alone in raising concerns over freeing up of deposit rates. Former RBI governor YV Reddy recently said in an interview it may be detrimental to the interests of a large number of people. Many of the common people don't have time to apply their mind and shift money from savings to deposits, etc. So, for heaven's sake, give one banking instrument, one bank account where the man knows that this is the interest rate, this is the facility. This is required. I would even say, particularly, it is required for women in India whose money should be safe from their husbands, Mr Reddy had said. Banks, which are keen on lowering their cost of funds, are lobbying with the central bank for freeing up of savings rates. Those with lower balances could be short changed for wealthy clients who anyway are paid higher rates for funds in the name of bulk deposits. Freeing up could lead to volatility. A bank may pay 1% or less for those account holders who have small deposits and 5% if they are willing to keep 50,000 in a savings account. This in turn will impact small depositors. Even public sector banks which carry-out



government programmes would get in to a disadvantage. Deregulation of rates would be detrimental for PSU banks which control 72% of the banking market. We are the bank which does most of the real sector activity of the country in any case, said Mr Bhatt. So if we are weakened by the higher cost of deposits, our ability to do the kind of work will be affected, he added.

31-Mar-2011 BL

‘SBI is 100% compliant with everything RBI wants us to do' : In a no-holds-barred interaction with the media a day before his superannuation, Mr O. P. Bhatt, Chairman, SBI, spoke his mind on the special home loan scheme, deregulation of savings bank rate, his ‘working relationship' with the banking regulator, and why dissent is healthy in public discourse. On special ‘teaser' home scheme: Our special home loan product is not at all similar to what was there in the global markets or in the US. In the US, the home loans, which caused the sub-prime crisis, were given to people who had no jobs, no income, and no assets. In the last many years, real estate was appreciating between 5 and 10 per cent every year in the US. There was an assumption that it will continue to happen in the future also. So, the assumption was that if you give a home loan today and in a year or two if the borrower is not able to repay, the property would have appreciated, and he can always sell the property, repay the loan and go away. So, the bank did not suffer any loss. These loans were sub-prime to begin with because the borrower did not have any income, no wherewithal. But our home loans are given based on job or income criteria only. We take into account the borrower's take-home salary after loan repayment and provident fund deduction. If the take-home pay is, say, Rs 100, then the quantum of loan will be such that the borrower's EMI is not more than Rs 40. Proof of salary is in the form of income tax deduction certificate. We stringently assess affordability, suitability, and eligibility for home loans. Our borrower is not sub-prime. The selection of the borrower is such that he is a creditworthy individual. SBI tells the borrower clearly that his or her EMI works out to Rs 40, but we will take Rs 35 as EMI in the first year, Rs 36 in the second year, Rs 38 in the third and Rs 40 after the third year. This, we give in writing. So, it is totally transparent. There is no element of surprise. After three years when we take Rs 40 as EMI, there is a 99 per cent possibility that the borrower's take-home pay would have increased to Rs 105 or Rs 110 or Rs 120. Then in percentage



terms, the loan becomes less risky as the EMI is less than 40 per cent of the take-home pay. So, the loan is totally de-risked. The RBI has not understood this. Differing with the regulator on provision coverage ratio and special loan schemes: Till today, I would like to place it on record that SBI is 100 per cent compliant with everything that the RBI wants us to do. But wherever we have felt that the regulator could or should have done differently, we have represented to them, whether it is provision coverage ratio or the special home loans scheme. And after the representation, we have done exactly what they have asked us to do. In the case of PCR, we thought that it was just arbitrarily raised to 70 per cent. We did make a representation, but the RBI did not agree. Then we said that we cannot do it in one year because it would involve more than a year's profit. So, they have given us a time-table and we are scrupulously adhering to it. In the case of special home loans, if they agree to our reasoning, then there is no issue. Even if they don't, we will make whatever provisioning is required. SBI group has a 25 per cent market-share in the banking system. I believe it is our responsibility or duty that if at all we have a different point-of-view than others in the system, then we must articulate it in the interest of intellectual honesty, in the interest of public discourse, and in the interest of evolution of public policy. So, that is what we have been doing and it requires courage of conviction to do be able to do that. We have not been irresponsible, we have not misbehaved, and we have not used wrong words. Till date, during my tenure, there has been no deviation from any compliance, not only in India but in any of the 32 countries that we operate. Deregulation of savings bank rate: The savings bank is a unique product. No other country has it. It has done quite well, I think, for a large number of small savers, who cannot have recurring deposit or fixed deposits. There are about 400 million people in this country who earn less than Rs 50 a day. When they are able to save, they save Rs 5 or 10 or 20 in an SB account.


They cannot save in an FD or RD because their incomes are irregular. But once the SB rate gets deregulated, with interest rates going up and down, the small customers will have difficulty. Also, there are a large number of government organisations that get a lot of grants, which they cannot keep in FDs. So, either they can keep the funds in a current account or SB account. While the current account will not earn any interest, the SB account will fetch them something. The cost of resources for PSBs, because we have been servicing the largest part of this clientele — both government accounts and the small customers — is low due to low cost Current and Savings Bank account deposits, which have improved significantly. This has helped us reduce our cost of resources. This, in turn, has reduced the cost of working in the Indian economy. These are all good things. PSBs, with 72 per cent of market share, do most of the developmental activity in this country. So, if we are weakened due to the higher cost of deposits, which the deregulation will entail, our ability to do the kind of work that we do — and we do it quite happily and willingly, because it is part of our DNA — will get impaired. Does the country want it or deserve it? They don't. Post retirement plans: My post retirement plans are still in the making. While there are a few people or organisations who have been trying to engage with me, I felt that it was not proper for me to do so as long as I am with SBI. In the next two to three months I may travel, I may laze around, I may talk to some of these people. But I will talk to my friends and well-wishers as to what kind of course I should plan for the rest of my life. Vision for the bank: The bank has done a lot of things not only in quantitative terms, but in qualitative terms. All of us in the bank have more pride, more belongingness, more confidence, more of a ‘can do' attitude. So, a qualitative shift has taken place in the minds of our people. Also, we have become a more service-oriented organisation. We really want to do better by our customers in every which way. We keep thinking how best to serve the customer by way of technology, by way of processes, by


way of organisation structure and so many things that we are doing. This is one of the biggest gains that has happened in the bank. But wherever we have felt that the regulator could or should have done differently, we have represented to them, whether it is provision coverage ratio or the special home loans scheme.

30-Mar-2011 ET

SBI may retain special home loan plan : The Reserve Bank of India and State Bank of India may still be arguing on whether the fixed-cum-floating rate home loans should be termed 'teaser' or 'terraced'. But small borrowers such as Kamlesh, a nurse in a government hospital, say that they couldn't have asked for a better deal at a time when rates are soaring. Not only did she get a Rs 15 lakh home loan at a time when others were dithering but has so far managed to avoid a steep rise in her equated monthly installment (EMI) or her loan tenure. And, to bring cheers to borrowers SBI is likely to extend its offer. Kamlesh is among the 7.29 lakh home loan borrowers who have opted to avail of the scheme up to February. In all, the bank has sanctioned close to Rs 90,000 crore under the special scheme that was launched at the height of the global financial crisis in 2008. There are others such as Monu Rana, a manager in a global BPO outfit, who has availed of aloan of Rs 8.5 lakh but is looking to upgrade to a bigger house in three-four years. So Rana being hit by higher rates is unlikely. In the first year of the loan term, the rate is fixed at 8.5% before rising to 9% in the second and the third year. And, from the fourth year onwards, it turns flexible although bank officials say that the increase is not significant (see table). But it is the EMI that borrowers will have to pay from the fourth year that has caused a furore, first from rivals, and then from the RBI, which has increased the amount that banks have to set aside to meet the RBI norms. This had prompted other lenders to withdraw the product from the market. But SBI has so far kept the offer intact, barring an increase in interest rate from what was originally offered, by tweaking the plan to stay clear of the higher provisioning requirement. The RBI has argued that borrowers do not know how much they would pay when the interest rate turns flexible. This, they say, could result in default. Some of SBI's rivals have gone to the extent of terming it India's sub-prime . “By that time (when interest rate turns flexible) my income will also go up so I will be better equipped to handle the higher burden. Had I got a loan from someone else I would have had to deal with the same uncertainty from the



initial days itself,” says Kamlesh. SBI officials, led by chairman OP Bhatt, say the assumption is not true. “We are clearly mentioning what the terms are. There is no opacity as is mentioned in the Economic Survey,” Bhatt says. SBI officials add that there has been no dilution in due diligence or eligibility norms. They point out that default rates have not gone up for the country's largest lender. Besides, Bhatt says the loan scheme has helped several firsttime buyers who would have faced difficulty in paying higher EMIs during these times. That is borne out by the average ticket size, which is Rs 12 lakh. Bank officials also say that the regulator did not make any adverse comments on the fixed-cum-floating schemes when almost all banks were offering the product at the height of the crisis. So, will Bhatt extend the validity of the offer beyond March 31, the day he superannuates? That's something that he is unwilling to comment on. But from all available indications the scheme will live for another day.

30-Mar-2011 FE

Successful OutReach Model: The State Bank of India has built strong partnerships at the front end and resilient institutional infrastructure at the back end to achieve the next phase of bank's business correspondent out reach of universal coverage between 2011 to 2015. SBI is also sufficiently geared to to scale up the efforts for financial inclusion throughout the country. It plans to reach all the financially excluded villages where there is absence of banking facility either through a branch or a BC in next five years. We have 16-17000 BCs as of now which are being expanded every month . The bank has also deployed various technologies and has experienced their pros and cons. Similarly, the BCs represent a variety of institutions and individuals. The experience has been quite useful for learning about what needs to be done.We have invested Rs 100 crore in relevant technologies which will be doubled in next two years .. The key challenge at this stage of the model's evolution is to find a sustainable model, which is profitable for all the stakeholders involved, while being useful for the clients. Many BCs and customer service points (CSPs) are finding it difficult to sustain themselves and this is direct impediment to scaling up the model. At scale all losses will get magnified. With this challenge in view the bank has launched a nationwide project to improve the viability of this model and scale it nationally. The bank is working on a comprehensive BC model, addressing all the challenges it has faced thus far, focusing on the effectiveness and viability of



























the BC and the bank.The model is being developed in partnership with agencies like IFMR Finance Foundation(IFF), High Mark Credit Information Services and Rural Technology and Business Incubator(RTBI) of IIT -Chennai Every Village in India will have an SBI CSP This effort plans to have a CSP in every financially excluded village, so that the service is accessible to every customer. The focus will be on a ''kirana' shop to play the role of CSP . Retailers are best suited for providing these services, and they don't need to fully depend on this channel for viability because they have other sources of income as well. This will effectively mean that a CSP will be available at a walking distance from all clients and thuis CSP will be available for transactions most of the day. The CSPs and BCs would be dynamically incentivised on every milestone they reach in terms of clients acquired revenue generated, products used , loans orginated and successful recovery of defaulters Low cost reliable and user friendly technology The project will focus on technology with low capital and operating experience, with high reliability. For example, a large part of the roll out will be with applications using low-end mobile phones. One of the key technologies integrated for this channel the voice based technology, which uses voice biometrics to authenticate a customer and voice recognition to enable the customer to carry out a transcation entirely based on a voice conversation even in local language/dialect. Other mobile based technologies will be given preferences. This greatly reduces the expenses of CSP. Availing loans from SBI Besides the basic banking services like savings account, fixed deposit, recurring deposit etc most of CSPs will also provide loans , local payments,(interbank and intra-bank) remittances, bill payments , government payments, mobile and DTH top-ups and other products that are useful for the clients. Cross selling of third party products like insurance would also be encouraged. While this would make its attractive for a rural person to have a bank account and carry out transactions, the transcation history would enable credit rating for the customer. A major emphasis will be given on local payments and remittances. Fees will be charged for most of services being used by the clients, based on what the clients find useful to pay for. Training


Extensive training and support top the CSP and BC will be provided. The bank will develop a comprehensive training infrastructure to develop the channel, leveraging its existing infrastructure of rural training institutes, The bank is also developing a comprehensive, real-time monotoring system for tracking the progress of the network. Multi-channel focus The project would focus on reaching scale through three different channels a) One of the channels for appointing a bank's BC is to partner will small NGO-MFIs who would set up a wide a network of CSPs across villages and offer the various services along with the group-based loan product. The key advantages of this channel are in terms of their local knowledge and their ability to provide group loans. b) The second channel would be to use telecom service providers(TSPS) as BCs The TSPs woul;d have to select some of their best retailers as CSPs in order to reach with financial services into rural India c) The third channel will be through BCS formed by technology companies. Over the last couple of years, they have built a vast network of CSPs and this will be deepened and strengthened. I am sure going ahead the SBI's business correspondent out reach model will be profitable while expanding the bank's network manifold in short span of time.

30-Mar-2011 FE

SBI opens affordable housing loan cell : State Bank of India on Tuesday inaugurated its first affordable housing loan' cell in Mumbai, which will provide a platform for its customers to interact with the bank. The first facility has been set up in Nalla Sopara where the bank has its branch. 'The facility will be set up near localities where affordable housing projects are undertaken. The cell is a distinct delivery structure, which has been designed to offer a simple model for appraisal/sanction methodology suited to the segment,' a bank official said.

29-Mar-2011 BS

SBI may continue teaser loans : The country's largest lender, the State Bank of India (SBI), is likely to continue with its special home loans beyond March. Under the special scheme, for home loans of less than 30 lakhs, SBI charges 8.75 per cent for the first year, 9.5 per cent for second and the third year and 150 basis points above the base rate from fourth year. SBI offers fixed discounts on interest rates for the initial years. Sources said the lender may tweak these rates to suit the rising interest rate scenario but may not




withdraw the scheme. 'We are yet to take a final call but it is expected to continue,' said a senior SBI official. The scheme was scheduled to end on March 31. SBI had launched the special home loan scheme with interest rates as low as eight per cent but this was later increased to 8.5 per cent and was linked to the bank's base rate. The Economic Survey 2010-11 said these loans helped financial inclusion as most were first time borrowers. The Reserve Bank of India (RBI) had expressed concern on the nature of such loans, saying some borrowers may find it difficult to service the loans once the normal interest rate, which is higher than the rate applicable in the initial years, becomes effective. 'It has been observed that many banks at the time of initial loan appraisal do not take into account the repaying capacity of the borrower at normal lending rates,' said RBI in its second quarter review of monetary policy 2010-11. RBI had mandated banks to increase the standard asset provisioning by five times to two per cent for all teaser loans. SBI Chairman O P Bhatt felt their home loans did not come under the teaser category and, hence, there was no need to increase provisioning on these loans.

29-Mar-2011 TE

SBI may retain special home loan plan : The Reserve Bank of India and State Bank of India may still be arguing on whether the fixed-cum-floating rate home loans should be termed 'teaser' or 'terraced'. But small borrowers such as Kamlesh, a nurse in a government hospital, say that they couldn't have asked for a better deal at a time when rates are soaring. Not only did she get a Rs 15 lakh home loan at a time when others were dithering but has so far managed to avoid a steep rise in her equated monthly installment (EMI) or her loan tenure. And, to bring cheers to borrowers SBI is likely to extend its offer. Kamlesh is among the 7.29 lakh home loan borrowers who have opted to avail of the scheme up to February. In all, the bank has sanctioned close to Rs 90,000 crore under the special scheme that was launched at the height of the global financial crisis in 2008. There are others such as Monu Rana, a manager in a global BPO outfit, who has availed of a loan of Rs 8.5 lakh but is looking to upgrade to a bigger house in three-four years. So Rana being hit by higher rates is unlikely. In the first year of the loan term, the rate is fixed at 8.5% before rising to 9% in the second and the third year. And, from the fourth year onwards, it turns flexible although bank officials say that the increase is not significant (see table). But it is the EMI that borrowers will have to pay from the fourth year that has caused a furore, first from rivals, and then from the RBI, which has increased the amount that banks have to set aside to meet the RBI norms. This had prompted other lenders to withdraw the product from the market. But SBI has so far kept the offer intact, barring an increase in interest rate from what was originally offered, by tweaking the plan to stay clear of the higher provisioning requirement. The RBI has argued that borrowers do not know how much they would pay when the interest rate turns flexible. This, they say, could result in default.



Some of SBI's rivals have gone to the extent of terming it India's sub-prime. 'By that time (when interest rate turns flexible) my income will also go up so I will be better equipped to handle the higher burden. Had I got a loan from someone else I would have had to deal with the same uncertainty from the initial days itself,' says Kamlesh. SBI officials, led by chairman OP Bhatt, say the assumption is not true. 'We are clearly mentioning what the terms are. There is no opacity as is mentioned in the Economic Survey,' Bhatt says. SBI officials add that there has been no dilution in due diligence or eligibility norms. They point out that default rates have not gone up for the country's largest lender. Besides, Bhatt says the loan scheme has helped several first-time buyers who would have faced difficulty in paying higher EMIs during these times. That is borne out by the average ticket size, which is Rs 12 lakh. Bank officials also say that the regulator did not make any adverse comments on the fixed-cum-floating schemes when almost all banks were offering the product at the height of the crisis. So, will Bhatt extend the validity of the offer beyond March 31, the day he superannuates? That's something that he is unwilling to comment on. But from all available indications the scheme will live for another day.

29-Mar-2011 TE

SBI-TCS joint venture helps rural banks go online : Even as large banks spend hundreds of crores on their core banking software to bring anywhere anytime banking services to customers, a little-known joint venture between State Bank of India and TCS is making the same technology available to rural banks and small cooperative banks at a fraction of the cost. As many as 4,200 branches of 52 regional rural banks and cooperative banks have managed to go live on a core banking platform without any major investment. These entities include a seven branch bank in Nagaland and a 20 branch lender in Jammu & Kashmir. C-Edge, a joint venture of the country's largest bank with TCS, is using the application service mode to make available to small lenders the same BaNCs 24 core banking software used by large banks like State Bank of India, Central Bank and Indian Bank. Once the banks transfer all their customer information to the central database their customers can withdraw money from ATMs and send money instantly to other branches. 'One single server of ours in Mumbai is hosting databases of all these 52 banks. The branches have to take care of only the desktop computers and we take care of the entire software, the networking and the hardware from the branch router onwards' said Krishna Kumar, CEO, C-Edge. Besides the central server, the data is stored in a separate disaster recover centre in Bangalore 'This is possible the first example of cloud computing in India. Given the



shared infrastructure we offer a start-up bank can offer a whole suite of products to customers from day one' said Mani Mamallan, chief marketing officer at C-Edge. What this means for the banks is that even the smallest rural lender can provide its customers ATM and remittance services which was hitherto not possible. 'Besides the benefits to the customers, we also take the responsibility of generating statement for MIS reporting and generating reports for the regulators. The other advantage is in preparing their balance sheets and annual results. With a core banking solution it is possible for a bank to generate its balance sheet on a daily basis. Addressing the economics of the technology is only one of the aspects that C-Edge had to address. According to Kumar there were a host of challenges. 'To begin with most of the branches were completely manual. The staff required training and there was a need to provide a helpdesk in local languages' he said. Over time all these issues have been addressed, but one challenge that continues to hamper is the availability of power. 'We are talking to companies that are in solar power generation to put in low cost equipment that will run at least one computer during a power failure' he said.

26-Mar-2011 BS

SBI to raise $1 bn via bonds : The State Bank of India (SBI), the country's largest lender, today said it was planning to raise about $1 billion (Rs 4,500 crore) from overseas markets in the next financial year. The funds will be raised through bonds to support the state-owned bank's growth plans next year. 'The issue could be (worth) around $1 billion. We will do that at an appropriate time, depending upon the market conditions and our requirements,' Chairman O P Bhatt said on the sidelines of the Skoch summit. Bhatt said the amount would be raised in one go, like the bank did in the past. On interest rates, Bhatt said the bank was not likely to raise rates in the current financial year. He said credit offtake is relatively low in the first quarter of a financial year and unless there was significant growth in credit demand, lending rates were unlikely to rise in the next few months. 'There is a general upward bias in the interest rates in general. There has been more impact of it on deposit rates because liquidity was tight and everybody was preparing for the quarter-end surge which takes place. It has been less on the loan side so that bias continues but regardless of that my own sense is that in the next few months lending rate is not going to be increased,' he added. In its mid-quarterly policy review on March 17, the Reserve Bank of India had increased repo rate and reverse repo rate by 25 basis points.

26-Mar-2011 BL SBI may raise around $1 b overseas next fiscal : State Bank of India (SBI) is likely raise close to $1 billion through medium-term notes (MTN) in the next financial year.




“There will be an issue in the overseas market in the next financial year. The money would be raised in one go,” said SBI Chairman, Mr O. P. Bhatt, on the sidelines of the Skoch summit here on Friday. Mr Bhatt added that the quantum of overseas fund-raising plan would be finalised at an appropriate time depending on the market conditions and the need of the bank. Commenting on interest rates, Mr Bhatt said that they are likely to remain stable during the current fiscal. “Unless there is significant growth in the credit demand, lending rate is unlikely to rise in the next few months,” he added. The SBI Chairman said that credit off-take is relatively quiet during the first quarter of a financial year. There is a general upward bias in interest rates, but the impact has been more on the deposit rates side because liquidity was tight and everybody was preparing for the quarter-end surge, he added.

24-Mar-2011 ET

SBI retail bonds yield 3% on debut day : SBI's retail bonds traded the highest ever for a fixed income security on debut on bourses, yielding 3% returns for investors, but it may not yet be the beginning of evolution of a vibrant bond market which regulators and the government are hoping for. The nation's largest bank's bond sale may be a one-off event as hardly any issuer could match SBI's clout both in network, marketing costs and branding. The debut trading price was lower than investors expected as many retail traders sold off their bonds ahead of the fiscal year ending March 31 and the possibility of further rate increases that could lower bond prices. The bonds worth 8,500 crore traded for 2,900 crore, or 28.28-lakh bonds, after starting to trade at 10,200 a bond. Its intra-day high was 10,373 and the low was 10,170, before ending at 10,267.42. The marketing cost of issuance is high almost about 2-2.4%, if the issuer is to reach out to the masses, says JP Morgan MF chief investment officer Nandkumar Surty. RBI and the government have been talking for more than a decade to make the bond market vibrant, but it hardly happened due to various regulatory and tax issues. Response to bond floats from infrastructure lenders this year reflects the poor appetite for them since they are not attractive and have poor liquidity.



SBI chairman Om Prakash Bhatt created a flutter when he offered the highest coupon on bonds, surprising and drawing criticism from some. But the rest of the market is now following as they scramble for funds in a rising interest rate regime. SBI's 2,000-crore public sale of 10-year bonds at 9.75% and 15-year ones at 9.95% with call options last month received bids for at least 8,500 crore. While more than two lakh retail investors got full allotment, funds and wealthy individuals who bid for more than 5 lakh were given just a fourth of what was bid for. It was allotted on the first-come-first-serve basis. This was despite SBI restricting its collection centres that drew criticism from investors in smaller towns and cities. Applications were accepted in just 126 or less than a percentage of its branches. The sale was supposed to take the bond culture to retail investors. However, there was just one collection centre in Guwahati for eight northeastern states. Bihar and J&K had one each, Gujarat at least 15 while Mumbai alone had seven centres. I think this was like a promotional offer for retailers. We have also observed retail participation in the bond market for the first time. Many buyers, in fact, do not know much about the bond market, said Meghal Shah, an Ahmedabad-based stock broker. But the trading interest may wane in the next few days as those traders who had profits have locked it up. Yields are likely to see some correction, as the selling pressure eases and they may see some alignment around yields seen in the bonds dealt in the whole sale debt market (around 9.15-25%), said Edelwiess Capital senior vice-president Ajay Manglunia.

24-Mar-2011 BS

SBI bond issue sets primary market alight : The bumper listing of State Bank of India's (SBI) retail bond issue has put life back into the primary market. Investors, who had put a full subscription of Rs 5,00,000 in the issue, made a cool 4 per cent or Rs 20,000 in just about 21 days. This is on the back of better than expected listing of the bond, which was quoted at a premium of Rs 300 in the grey market of Gujarat and Mumbai above its face value of Rs 10,000. The SBI Bond N' series was listed at a premium of Rs 365 on the National Stock Exchange (NSE) against the face value of Rs 10,000. During the day, the counter also touched a high of Rs 10,385 before it closed at Rs 10,250. While investors seem to have made around Rs 15,000 if they sold the bond today around its listing price, they would get an additional Rs 5,000 by the end of this month in their account. The bond holders will get Rs 2,700 as interest at the rate of 9.75 per cent on their application as the issue closed



on February 26 and the bonds were credited to investors' demat accounts only on March 16. The interest is for these 20 days. Also, investors will get another sum of Rs 2,080 as interest at the rate of 9.95 per cent, which was the coupon rate of the bond. The logic is that SBI's cut-off date for paying the interest on bonds is March 31, so investors will get this money for holding the bond for another 15 days. 'The bond issue, which was supposed to give around Rs 40,000-Rs 50,000 annual return, has given 50 per cent return on listing itself. This has generated euphoria among grey market operators and investors, who have set their sights on the forthcoming issues now,' said a Mumbai-based equity dealer. A large number of brokers, who had pitched dummy investors to subscribe to the issue on their behalf, made at least Rs 10,000 each from the issue. They had promised Rs 15,000 to investors upfront to apply on their behalf and the rest of the gains were to be passed on to the brokers. A few large brokers had at least 40-50 investors to apply on their behalf. Also, brokers were being offered 1.25 per cent as commission on each subscription. Brokers have now set their sights on the forthcoming retail bond issues of Tata Motors and Allahabad Bank, which will hit the market in a couple of months. The coupon rates, too, are likely to be higher, around 11 per cent. Together, 54,96,996 applicants received bonds worth Rs 10,000 each. The issue, which had opened on February 21, closed on February 28.

24-Mar-2011 BS

State Bank of Indore merger in interest of public: Govt : The acquisition of State Bank of Indore by State Bank of India (SBI) last year was in public interest, the Rajya Sabha was informed today. The merger was in “overall public interest,” Namo Narain Meena, minister of state for finance, said during a debate over the SBI (Subsidiary Banks) Amendment Bill, 2010, in Rajya Sabha. “Now, they (State Bank of Indore customers) can deposit and withdraw money from all 14,000 SBI branches,” he said. The upper house later passed the bill, seeking to omit all references to State Bank of Indore, acquired by SBI in July last year. He assured members the interest of employees would be protected. He added banks were doing a “commendable job”, with their performance being unaffected during the global recession. “The credit goes to the Reserve Bank of India and the banks alike,” he said.

24-Mar-2011 BL SBI retail bonds log robust turnover of Rs 1,595 cr : Investors, especially high net worth individuals, on Wednesday booked handsome profits on the listing of the State Bank of India's third and fourth series of retail bonds.




The highlight of the trading debut was that bonds in the fourth series, which fetches a return of 9.95 per cent for 15 years for retail investors, saw a robust turnover of Rs 1,595 crore. Bonds in the third series, which fetches a return of 9.75 per cent for 15 years for retail investors, saw a modest turnover of Rs 37 crore. Against Rs 10,000 face value, bonds in the fourth series (retail category) got listed at a premium of Rs 10,365, touched an intraday high of Rs 10,385 and a low of Rs 10,200. The last traded price of this bond was Rs 10,250. Given that allotment to institutional investors in series 3 and 4 was restricted to Rs 500 crore each, they picked up the bonds from the secondary market. The bonds were listed on the NSE and the BSE on Wednesday. Institutional investors “HNIs made listing gains. The coupon on the bonds has proved to be a big draw for institutional investors. Hence, pension funds and insurance companies bought the bonds from the secondary market. Typically, retail investors have a buy-and-hold strategy,” said a debt market analyst. Bonds in the third series (retail category) got listed at a premium of Rs 10,250, touched an intraday high of Rs 10,280 and a low of Rs 9,965. The last traded price of this bond was below the face value at Rs 9,971.15. In the case of bonds for investors in the non-retail category, the third series, which fetches a return of 9.30 per cent for 10 years, logged a turnover of Rs 2.26 crore. Bonds in the fourth series, which fetches a return of 9.45 per cent for 15 years, saw a turnover of Rs 15.68 lakh. A likely benchmark “From an individual perspective, the ‘AAA' rated SBI retail bonds are very attractive. These bonds will emerge as a benchmark for future retail bond issuances. Given that the current liquidity situation is a bit tight, only those institutions with a surplus have picked up the bonds from the secondary market,” said Mr S. Ramesh Kumar, Senior Vice-President, Asit C Mehta Investment Intermediaries. Bonds in the third series (non-retail category) got listed at a premium of Rs 10,390, which was also the intraday high, and a low of Rs 9,855, which was the last traded price.


Bonds in the fourth series (non-retail category) got listed at a premium of Rs 10,300, which was also the intraday high, and a low of Rs 9,904. The last traded price for this bond was below the face value at Rs 9,915

23-Mar-2011 FE

SBI to venture into cluster financing to promote SMEs : In a bid to boost the SMEs, country's largest bank State Bank of India (SBI) has decided to focus on cluster financing from the next financial year. Through cluster financing, which is the Chinese model to support small and medium scale businesses for export purpose, the bank will make efforts to develop multiple SME centers all over country. Speaking to FE Manas Kumar Nag, CGM and head-SME, SBI, said, In the next financial year we would also like to increase our customer base by providing relationship banking to smaller SMEs. SBI has currently has over 1.35 million customers and has over R20,000 crore exposure in the SME segment. There has been a pick up in SME credit off take in the last few months after the downturn. However, certain sectors like textiles, jewellery which are largely export oriented are still to fully recover because the crisis hit exports, he said. Our bank has a policy of restructuring for SME clients. During the downturn we had taken it up for potentially viable SME clients to help them tide over the crisis,'' Nag said. The bank is recording 21% credit growth in SME funding during the year. We have a system of credit risk assessment for loans above R25 lakh and we charge interest accordingly.

22-Mar-2011 BS

Interest rates seem steady, says O P Bhatt : Despite growing expectations of interest rate raises by banks following the central bank's 25 basis points increase in key policy rates last week, State Bank of India's chairman O P Bhatt today said these may remain steady till the next quarter. 'There is no pressure upon us,' Bhatt told Business Standard on the sidelines of a branch opening function. Bhatt also said the bank was expecting better financial results and would achieve targets on all parameters for the current financial year. He also said State Bank of India had sought permission from the government to merge its subsidiaries. It has so far amalgamated State Bank of Indore and State Bank of Saurashtra.

22-Mar-2011 BL

SBI customers can now SMS their grievances : SBI on Monday announced a pan-India rollout of its mobile-based customer grievance service “SMS Unhappy”. This service has been undergoing trial runs at select centres since last October.





To register a complaint, all that an aggrieved customer needs to do is send SMS, “Unhappy”, to the number 8008202020. The bank's customer service executive will then call the customer on his mobile phone, understand the problem faced by him, and escalate this issue to the office which has to take action. When the required action has been taken, the customer will be contacted by his branch and the customer service cell to update him on what has been done. Most of the complaints will be closed within 48 hours, the bank said in a statement. The bank's Chairman, Mr O.P. Bhatt, inaugurated the scheme from the bank's local head office at Bhopal

22-Mar-2011 FE

Rates won't be hiked in short-term : State Bank of India's chairman OP Bhatt has taken several initiatives to grow the bank's balance sheet over the last five years. Bhatt tells Sitanshu Swain and Kumud Das that raising interest rates could hurt growth. Will SBI up rates after the latest round of hikes in policy rates? I don't see any interest rate hike in the short-term. While there is upward pressure on interest rates, our view is that deposit rates have already moved up sharply and deposits have grown, so banks may not increase deposit rates further. But credit off take is not picking up as expected and once it starts picking up, only then rates will go up. Also, the lean season is on its way. At SBI, we have the highest deposit rates and the lowest yields on advances. Our average cost of funds is 5.20%, whereas our special home loans fetch 8.5%. Even if we borrow from RBI or through CDs our costs will not go up because we have a loan book of R5.5-6 lakh crore and our dependence on outside borrowings is not much. Experts say rates will go up by another 50-75 basis points... It is difficult to say if rates will keep moving up. But if inflation remains worrisome, there are chances of rates going up. However, most of the inflation is due to the supply side issues and if you keep on raising rates, you'll hurt growth but won't solve the inflation problem. Is the dispute over special home loans with RBI settled?



Even the Economic Survey, approved by the PMO and the Planning Commission, appreciated our efforts saying that on such products, if you put any restrictions, it should be minimum and judicious. We don't have a product which RBI can call a teaser product. My philosophy has always been that our products should reflect the customer's needs. Are you trying to become the largest mortgage financier in the country? No way. Look at the average ticket size of our home loan, it's only R12 lakh. I am sure HDFC's home loan size is much bigger. As I said we have to serve our customers well with right strategies. What are your plans to raise capital? We are quite hopeful we will get the government's nod for our R21,000 crore rights issue. If it happens, then it will be enough to take the care of the bank's funds requirement for the next three years. How do you see your five year tenure, one of the longest in bank's history? The bank has seen its balance sheet and profit double in the five years time since I took over. We had huge untapped potential in the rural space and I projected that the bank could add three times of its business from the rural banking, since we have more than 2,000 rural branches and another 4,700 branches in semi-urban areas. We are developing the business correspondent model with a high technology platform and have around 16-17,000 business correspondents which will triple in the next two years. The business correspondent model may not be profitable today but will make profits in couple of years and will contribute hugely to SBI's growth. Did talk of ICICI Bank overtaking SBI bother? But for the global financial crisis, ICICI Bank might have been much bigger bank today. Frankly speaking it didn't bother me at all. Before the global economic crisis and during and after it we have proved that we are better than other in terms of our grasp of the Indian consumers' needs and in serving them in a cost-effective manner.Whatever we do at SBI, it is being followed by every other bank in the country including the private sector and foreign banks.

22-Mar-2011

Other announcement of State Bank Of India, : State Bank of India has informed BSE that March 17, 2011 has been fixed as the Record Date for payment of Interest on 'Series 3 & Series 4 of Lower Tier II Bonds - 2011 (Tranches-1) of face value of Rs. 10,000/- each issued to the public ('Bonds'),



aggregating to Rs. 2,000 crore, for the first Year, i.e. for the period commencing from March 16, 2011 to March 31, 2011.

21-Mar-2011 ET

SBI hosts 8th MPFI Meeting : State Bank of India hosts the 8th meeting of Mobile Payment Fourm of India (MPFI). MPFI is a non-profit registered society that has created framework and standards for convenient mobile banking and payments in India. C. Narasimhan, DMD of SBI congratulated MPFI for the efforts and progress made by it and hoped that Mobil Payments would help in reducing cash based transactions and propel financial inclusion initiatives of Banks

19-Mar-2011 TE

SBI arms merger bill cleared : The government on Thursday cleared a bill to empower itself to effectively manage the affairs of subsidiary banks of State Bank of India. The move will also help facilitate the merger of the five subsidiaries with SBI, for which the government has indicate a timeframe of 12-18 months. While SBI executives said they were in favour of merging the remaining associate banks-State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore-the timing would depend on clearance from the government. SBI, the country's largest lender, has already merged two of its associate banks-State Bank of Saurashtra and State Bank of Indore-with itself to improve overall functioning and is ready with the template to merge the remaining five subsidiaries. Among other things, the bill that was supported by the parliamentary standing committee on finance seeks to empower the government to fix the authorised capital of associate banks and appoint managing directors. These amendments were necessitated as these powers were vested with the Reserve Bank of India from whom the ownership of these banks was transferred to the Centre a few years ago. The bill is among the six financial sector legislations being pushed by the government

18-Mar-2011 BL

Cabinet approves PFRDA, SBI Subsidiary Banks Bills: The Union Cabinet has approved the tabling of a revised Pension Fund Regulatory and Development Authority (PFRDA) Bill in the current session of Parliament. It has also decided to push for the passage of the State Bank of India (Subsidiary Banks Laws) Amendment Bill, 2009 in this session, which is to end





on March 25. The PFRDA Bill basically seeks to grant statutory status to the pension sector regulator, which currently does not have quasi judicial powers unlike the Reserve Bank of India or the Securities and Exchange Board of India. The second Bill would enable the five associate banks of SBI to raise their capital by issuing equity shares through the public or preferential allotment/private placement. That would, in turn, require dilution of SBI's share in these banks. The PFRDA Bill may have to be referred to a Parliamentary Standing Committee (since it is a new Bill, even if a revised version of an earlier one tabled in 2005). The SBI (Subsidiary Banks Laws) Bill, on the other hand, has been referred to the Standing Committee on Finance, which has already submitted its report. This Centre would, therefore, seek to get it passed in the current session itself, after incorporating the Standing Committee's recommendations. In his Budget speech, the Finance Minister, Mr Pranab Mukherjee, had referred to the two Bills, along with five other financial sector legislations that “I propose to move”.

18-Mar-2011 BL

Inflation is the biggest concern: SBI chief : Mr O.P. Bhatt, Chairman, State Bank of India,said: “Inflation is clearly the biggest concern which is underpinned by RBI's upward revision in the inflation projection. “Given the persistent stickiness in prices, RBI has now projected inflation higher at 8.0 per cent by March 2011 from 7 per cent earlier. This is a quick and steep upward revision. Against this backdrop, it was natural for RBI to hike the repo and reverse repo rates.” RBI may go aggressive Ms Rupa Rege Nitsure, Chief Economist, Bank of Baroda, said: Deposit and lending rate hikes are unlikely. Monetary transmission has taken place to a large extent over the last few months. The latest round of hike in key short-term rates by the RBI has already been factored in by banks. Going ahead, to contain surging inflationary pressures, the RBI may go in for aggressive rate hikes. In this regard, it may be pertinent to note that the monetary policy review does make any reference to its earlier ‘calibrated rate hike' stance.



More hikes in the OFFING Mr Abheek Barua, Chief Economist, HDFC Bank: Expectations of a moderation in inflation in first H1FY12 that the central bank had alluded to in its last policy statement in January are conspicuous by their absence. This along with the upward revision of the March estimate means that not only is the rate hiking cycle in FY12 now likely to be more extended than initially anticipated but is also likely to be far more front-loaded. We expect inflation to print in at 8.1 per cent in March and move higher close to 9 per cent by August. We see the RBI hiking its repo and reverse repo by another 25 bps in its Annual review in May and this is likely to be followed by 50-75 bps of rate increases through the fiscal year. Going ahead, to contain surging inflationary pressures, the RBI may go in for aggressive rate hikes.

18-Mar-2011

SBI Amendment Bill to be tabled in Parliament : The Union Cabinet on Thursday cleared the State Bank of India (Amendment) Bill for introduction in the current session of Parliament. Among other things, the Bill seeks to bring down the government's holding in State Bank of India (SBI) from the current 59.4% to 51%, on a par with other public sector banks. The government had in 2006 presented to Parliament a Bill to permit a reduction in its shareholding in SBI to up to 51%, but it lapsed in 2009. The Bill also provides for increasing SBI's authorised capital from 20 crore to 5,000 crore, raising capital by preferential allotment or by private placement, issuing bonus shares, allowing reduction of government's shareholding from 55% to 51% and restricting the voting rights of those holding preference shares. Experts see this as a good move, which could pave way for the bank to expand its capital base, through a follow-on public offer or a rights issue, or some other route. 'Fifty-one percent seems to be equated with the other public sector banks' holdings. It is a good move, but I think it's a signal that for all the future capital requirements, do not look forward to the government,' said Robin Roy, associate director, PriceWaterhouseCoopers. Suresh Ganapathy, head of financial research team, Macquarie Securities said the Bill merely gives the government the power to reduce its stake. However, the government would like to maintain its stake at 59.4%, he said, adding, 'If they had any intention, they could have brought down the same to 55% from the present 59.4% but they haven't done anything as such. It is a



positive, but the government is unlikely to reduce its stake.' At present, the stake of the promoter — the government — cannot fall below 55%.

15-Mar-2011 ET

SBI CMD, OP Bhatt says merger of subsidiary units a time taking process : The Chairman, SBI, OP Bhatt said that the merger of its subsidiary banks with the parent will not happen in one go and they will take it up one at a time. He said that though there are no roadblocks in the merger of its subsidiary banks it is a time taking process and certain steps need to be followed before a merger is initiated. He said that in the past the merger of two of its subsidiary banks with the parent, SBI, took about 2-3 years and therefore the merger of the remaining five subsidiaries would take about 3-5 years time. Also the merger would be subject to governmental clearances and addressing concerns if any raised by certain quarters about SBI becoming too big a bank for a balanced economic system, Mr Bhatt said on Monday on a visit to the state capital. With the Finance Minister proposing giving licenses to new private sector banks, Mr OP Bhatt said that a few more banks would only help the economy and there is enough space for each bank to grow. He said that the way the Indian economy is booming banking would also need to keep pace with the growth. In this scenario a few more banks which follow governance standards would only help in the overall growth of country. He said that the Indian banking system has proven itself to be strong and has been praised after the aftermath of Lehman Brothers, and the new banks would come up in a closely monitored sector. Mr Bhatt said that with inflation continuing to be a concern there seemed to be an upward bias towards an interest rate hike. Mr Bhatt who was here as part of SBI's 150th year celebrations, said that the bank had taken to spreading its network to the rural areas much before financial inclusion became a buzz word. He said that among other things they have introduced kiosk banking to spread its reach deeper into the rural parts of the country. He said that with economic progress trickling to rural India banking services were much needed in these remote locations. Also with many villagers still migrating to large towns, banking network was needed to send back remittances.



15-Mar-2011 BS

Upward bias in interest rates: Bhatt : Ahead of the mid-quarter review of monetary policy on March 17, State Bank of India Chairman O P Bhatt said in Lucknow on Monday said there was an upward bias in interest rates. However, he clarified that RBI's action (to tinker with key policy rates or keep these unchanged) would depend on its thinking and various other factors, including external. Bhatt said 'the current problem is not of liquidity, but inflation and the task is to strike a balance between growth and inflation.' 'Key policy rates can be hiked anytime, when RBI decides, be it March 17 or later,' he said.

14-Mar-2011 ET

SBI Youth for India fellowship launched : State Bank of India has launched SBI Youth for India a one-year rural Fellowship Programme for young professionals and graduates as a step towards bridging India's growing urban-rural divide. This CSR initiative is designed, funded and managed by the SBI in partership with reputed NGOs.

11-Mar-2011 BS

State Bank of India eyeing buys, overseas expansion : Public sector lender State Bank of India (SBI) is looking to acquire banks in Africa and Southeast Asia as it seeks to ramp up its overseas operations, according to a senior company source with direct knowledge of the matter. The country’s top lender planned to spend roughly $200 million on overseas acquisitions and would mainly focus on banks with strong corporate banking services in the two regions, it added. “Earlier, we were looking at large acquisitions. However, after the global financial meltdown, we are looking at smaller deals,” the source said on condition of anonymity. “We are looking at acquisitions in these markets. We see enormous opportunities on rising interest of Indian companies there. Expanding operations on our own would be challenging,” it said further. With a market value of $37 billion, SBI was aiming to raise the contribution of international operations to the group net profit to 25 per cent over the next five years, from about 16 per cent now, the source said. As cash-rich Indian firms farm out across the globe through a slew of merger and acquisitions and joint ventures, stodgy Indian banks are also looking to follow suit to serve the needs of the local companies. SBI, which controls a quarter of Indian bank loans and deposits along with its associates, and its rivals ICICI and HDFC Bank have been slower than their Chinese counterparts as far as expanding international operations is concerned. China Construction Bank, the country’s second largest lender, is keen to





acquire a stake in Malaysian lender EON Capital Bhd, The Edge weekly newspaper reported last month. SBI’s international loan book grew nearly 18 per cent from a year ago to touch $24.6 billion as of end-December, data on the bank’s website shows. The bank’s total loan book stood at $164 billion as of end-December. “Our focus is on improving the quality of our international loan book rather than growing it at a very aggressive pace,” the source said. At 2,589.7, SBI’s shares ended 1.6 per cent lower on Thursday.

7-Mar-2011 TE

Gupta to be named SBI MD : Diwakar Gupta is set to be appointed one of the managing directors of State Bank of India, the country's largest bank, though there is no clarity on who the other two MDs would be. Sources told TOI that the department of personnel and training has cleared his appointment and a formal notification is pending with the finance ministry. Gupta is currently a deputy managing director and group executive, national banking. Two other deputy managing directors- Hemant Contractor, who is the CFO, and Pratip Chaudhuri, in-charge of international banking-were also recommended for the posts of MD. The two are also in the reckoning for the post of chairman since O P Bhatt is due to retire at the end of the month. Gupta until recently headed SBI Cards, SBI's credit card joint venture with GE Caps. In fact, he was the first SBI nominee that the credit card arm had in the wake of losses reported by it. Gupta was given a clear mandate to turn around the company and put in place a new strategy that was also linked to the bank's operations. He will now join R Sridharan as the second MD. While the bank has traditionally had two managing directors, a recent amendment to the law has made it possible for the government to appoint two more MDs. The second MD's position has been lying vacant for nearly six months since the retirement of S K Bhattacharya.

5-Mar-2011 FE

SBI launches SMS Unhappy Service : The country's largest lender State Bank of India (SBI), has launched an additional channel for redressing customer grievances- 'SMS Unhappy Service'. The channel is still in its nascent stage as the full-fledged launch is yet to take place. We have gone for the soft launch of the programme at all the 14 local head offices (LHOs) located across the country. Once we get a good response from the soft launch of the programme, we will go for a formal launch. As of now, we are getting thousands of complaints from our customers through this




channel. a bank official told FE. Under this system, LHO's have so-called Happy Rooms that deal with the customer grievances. Any customer who wants to lodge a complaint sends the message Unhappy to a specified number (8008202020 ). The Happy Room then calls the customer and records the details of the complaint. The complaint is then forwarded to the branch in question.

4-Mar-2011 FE

Interest rates near peak, says Bhatt : Interest rates in India have peaked or are near a peak, said SBI chairman OP Bhatt. The central bank has raised rates seven times in the past 12 months but headline inflation has remained high partly due to high food prices caused by a sudden shortage of fruits and vegetables. The Reserve Bank of India is widely expected to raise rates by 25 basis points at its policy review on March 17.

4-Mar-2011

State Bank Of India - Record Date : State Bank Of India has informed the Exchange that the Bank has fixed March 16, 2011 as the 'Record Date' for the purpose of payment of yearly interest for the year ended March 31, 2011 for (1) Scrip Code: SBIN N1; ISIN : INE 062A08017; Date of Issue : November 04, 2010; Maturity Date : November 04, 2020; (2) Scrip Code: SBIN N2; ISIN : INE 062A08025; Date of Issue : November 04, 2010;

3-Mar-2011 TG

SBI bonds to fetch Rs 5500cr : Money matters Mumbai, March 2: The State Bank of India (SBI) is planning to retain a greater portion than it initially envisaged of the over-subscribed amount vis--vis its rights issue that closed on Monday. Indias No. 1 bank had planned to raise Rs 1,000 crore with the option of retaining another Rs 1,000 crore of the oversubscribed amount. The plan now is to raise as much as Rs 5,500 crore. The public issue of Lower Tier II bonds opened for subscription on February 21 and closed on February 28. We will retain up to may be Rs 5,500 crore. The rest we will return, SBI chairman .P. Bhatt told reporters on the sidelines of a conference organised by the Indian Banks Association (IBA). The SBI had the option of going up to the shelf limit of Rs 10,000 crore. The bonds were issued in two series Series 3 and Series 4. The issue received a huge response with subscription by retail investors standing at Rs 4,500 crore, while an additional subscription of nearly Rs 4,000 crore came from other investors, including high net-worth individuals.





The bank offered a 9.75 per cent coupon rate to retail investors on the 10-year bonds and 9.3 per cent to non-retail applicants. These bonds carry a call option in the fifth year. For the 15-year bonds, the coupon stood at 9.95 per cent for retail investors and 9.45 per cent for non-retail investors. Commenting on the banks rights issue, Bhatt said the Rs 20,000-crore issue would only come early next financial year as it needed to secure approvals from the central government There is a process in the government which is a part of the budget. Since so far we have not heard about the rights issue, it seems difficult that we will be able to get the rights issue before the (end of the) current financial year, Bhatt said. Bhatt is optimistic of the issue happening during the early part of the next financial year. The bank had earlier announced its intention of coming out with the rights offer in the last quarter of this fiscal. The government, which owns a 59.4 per cent stake, will have to contribute up to Rs 12,000 crore to maintain its stake.

2-Mar-2011 BS

SBI may retain Rs 5,500 cr in 2nd retail bond issue : In its second tranche of retail bonds, the country's largest bank, State Bank of India, may end up retaining around Rs 5,500 crore received against the Rs 2,000 crore that was notified. The issue, which closed yesterday, got subscriptions of around Rs 8,600 crore in a week. SBI had offered Rs 2,000 crore of retail bonds, including a Rs 1,000 crore overallotment option. According to sources, half of the issue that was reserved for retail investors was subscribed over nine times. SBI received around Rs 4,600 crore in over 200,000 applications. Since the bank has the option to retain up to Rs 10,000 crore of subscriptions from retail investors, the total amount could go up to Rs 5,500 crore. One-fourth of the issue reserved for high net worth individuals got bids twice the amount offered, while the one-fourth reserved for qualified institutional buyers got bids around 15 times the amount offered. The offer was open for a week and is believed to have been oversubscribed on the first day itself. An interest rate of 9.75 per cent for 10 years and 9.95 per cent for 15 years to retail investors seems to have attracted the flow. 'Even after paying tax, an individual can enjoy a return of 6.97 per cent on the 9.95 per cent bond,' said a bond dealer with a brokerage firm. Non-retail investors will be given 9.3 per cent for 10 years and 9.45 per cent for 15 years. The 10-year bonds carry a call option in the fifth year whereas the 15-year bonds carry a call option in the 10th year. The first issue of SBI's retail bonds was worth Rs 1,000 crore, including an over allotment of Rs 500 crore in October 2010, oversubscribed



almost 20 times. Like the earlier issue, bonds issued in the second tranche will also be listed on stock exchanges for trading. 'The existing SBI retail bond is being traded at 9.10 per cent, despite the availability of a fresh issue,' said another dealer. This reflects high demand for the bond in the secondary market as well. The bank could have raised the amount in the much cheaper wholesale market but attracting huge participation from the retail segment would not have been possible. The retail issue would have cost SBI 100 basis points higher as compared to a private placement. The total subscription figure can be even higher as the figures are not final. 'The subscriptions have been received manually at SBI branches across the country and it may take a couple of days more to know the total amount,' said a source close to the development. In December 2010, the bank's board had approved fund-raising of Tier-II capital worth Rs 10,000 crore by March 2012 in different tranches.

2-Mar-2011 BL

SBI's retail bonds subscribed over five times : State Bank of India's Rs 1,000-crore retail bonds issue was subscribed over five times, with the overall subscription, including those by high networth individuals and qualified institutional bidders, being pegged at around nine times. “Provisional data shows that retail bidders put in bids aggregating over Rs 5,000 crore. Qualified institutional bidders and high networth individuals have put in bids aggregating about Rs 3,500 crore and a little over Rs 500 crore,” said a merchant banker dealing with the bond issue. The issue opened on February 21 and closed on February 28.

1-Mar-2011 ET

Union Budget 2011: SBI gets right to reduce stake in subsidiaries to 51% : The government will give the State Bank of India, India's biggest bank, the freedom to reduce its stake in its subsidiaries to 51% through a bill proposed to be introduced in parliament during the budget session. The move will enable SBI to raise capital and boost its own operations. The finance minister in his budget speech on Monday announced that State Bank of India (Subsidiary Banks Laws) Amendment Bill, 2009 will be introduced soon. SBI is the country's largest bank with 20% market share and plans to tap the capital market to raise Rs 20,000 crore through rights issue. This will give SBI the flexibility to raise funds for its associates banks rather than infusing capital all by themselves. However, it is unlikely that SBI will opt for this option for its associate banks, specially the unlisted banks, since it is in consolidation mode, said Naresh Takker, MD and CEO of Icra. SBI has a number of associate banks in different parts of the country. In the




past few years, it has been merging some of these subsidiaries such as State Bank of Indore and State Bank of Saurashtra with itself in the past three years. Three other associates are listed such as State Bank of Bikaner & Jaipur, State Bank of Travancore where it holds 75% and State Bank of Mysore, where it holds 92%. In the remaining two banks - State Bank of Hyderabad and State Bank of Patiala SBI holds 100% stake.

26-Feb-2011 BS

New SBI-SG Global Securities services : SBI-SG Global Securities Services, a joint venture between India's largest lender SBI and French bank Societe General, has started offering fund accounting and fund administration services in India.

26-Feb-2011 TE

SBI retail subscription below 4k cr : Retail investors who have not yet invested in State Bank of India's high yield bonds continue to have a chance to get an allotment. Total retail subscriptions until Thursday were below Rs 4,000 crore. The issue will close for subscription on February 28. The bank, while launching its retail bonds, had said that although the target was to raise Rs 2,000 crore, the bank would retain subscription up to an overall Rs 10,000 crore provided the oversubscription came from retail investors. The bond issue which opened on Monday offers differential rates for retail and institutional investors. While retail investors get 9.75% and 9.95% on 10-year and 15-year bonds respectively, institutional investors will get only 9.3% and 9.45%. According to sources, the total retail subscription as on Thursday was Rs 3,897 crore, while the total bids from institutional and high net worth investors was also more than three and half times. However, since priority was to be given to retail investors it is likely that the total allotment to institutional and high net worth category would be limited to Rs 1,000 crore. The long-term bonds sold by SBI in August continue to be traded at a premium despite the yield being much lower than the return offered under the current issue. According to investment bankers, this is an indication that the market expects demand to outstrip supply of these bonds.. 'SBI's decision to restrict investment by high networth individuals and corporates would ensure that there is a latent demand for the bond even if retail demand is fulfilled. This would ensure that there is a good secondary market demand for the bonds,' said an investment banker. It is not clear what the impact of the crash in equity markets will be on the bond issue. However, in the past SBI has gained whenever there has been a 'flight to safety'.




25-Feb-2011 ET

Investors lap up SBI bonds again, issue subscribed three times: The State Bank of India's retail bond issue has been oversubscribed three times within two days of its opening. The country's largest bank mobilised about 6,000 crore, but a huge portion has been subscribed by non-retail investors such as qualified institutional investors, corporates and high net worth individuals. SBI chairman OP Bhatt said he expected a total subscription of around 10,000 crore by the time the issue closes on Monday. The SBI bond issue, which opened this Monday, aims to raise 1,000 crore with a greenshoe option of another 1,000 crore. The bank has decided to accept oversubscription from retail investors up to 10,000 crore. Mr Bhatt, who was speaking at the sidelines of an ICRIER seminar, expressed regrets about the bonds not having a wider reach. I am aware that a lot of investors have not been able to apply for these bonds and I am very sorry about it. We will make sure we have increased branch coverage for the next issue. The issue has come under criticism for its lack of reach this time, with only 126 of its branches offering the bond applications, which accounts for less than 1% of its total number of 14,000 branches. Further, since these applications are available only in physical form, access to them has become even more difficult. Investors subscribing to the issue need to have dematerialised accounts. While launching the bond issue, Mr Bhatt was confident that the bonds would be oversubscribed in the very first hour of the opening. Our last issue was oversubscribed 19 times mainly because of our brand and attractive pricing, he added. The issue comes with two options - 10-year bonds with a coupon of 9.75% and 15-year bonds at 9.95%. The 10-year paper has a call option after five years and it would pay only 9.30% for non-retail participants. The 15-year paper has a call option after 10 years and offers 9.45% for non-retail investors. Mr Bhatt has been very confident of not only the success of the bank's latest bond issue in terms of the amount it raises, but also of deploying the funds. At the seminar, he dwelt on Indo-Japanese trade prospects, saying he was for foreign banks coming to India as that made Indian banks more competitive. The SBI chairman said the bank would be more than happy to set up mid-corporate branches in Japan to cater to corporates exclusively.



Mr Bhatt denied reports of the bank making demands for a blanket permission for mergers with other subsidiaries to the Parliamentary Standing Committee on Tuesday. He said the report emanated from 'Parliamentary quarters' and he did not have much say in it.

25-Feb-2011 ET

SBI won't accept bulk deposits for a while : The country's largest lender, the State Bank of India (SBI), will temporarily step out of the bulk deposits market as it has enough funds to tide over tight liquidity in the money market. The decision closely follows a mobilisation of 3,900 crore by SBI from retail investors, who invested in bonds launched three days ago. The total subscription for the bond issue crossed 6,000 crore on the second day with financial institutions, mutual funds, corporates and high net worth individuals putting in the rest. Money market dealers said returns on bulk deposits would fall with SBI staying out of the market. Banks have been paying around 9.80-10% on one-year bulk deposits. The bank appears to be comfortable with its resources position and may lie low till March, said a senior banker. Bulk deposits constitute 10% of SBI's total deposits. The bank has begun attracting substantial funds after it raised rates to 9.25% for deposits of 1,000 days and 555 days. Besides, it can accept as much as 10,000-crore retail subscription for the ongoing bond programme. What has also influenced the decision is the slow loan growth this quarter. SBI chairman OP Bhatt has said in January that the bank's credit growth could be 18%, lower than 20-22% as projected for the present financial year. SBI officials said a large portion of the bank's old high-cost deposits have matured while the balance would mature by December.

25-Feb-2011 BS

SBI mops up Rs 3,897 crore via bond issue : State Bank of India (SBI), the countrys largest lender, has mopped up Rs 3,897 crore on the retail side through its latest bond issue, according to market sources. The issue opened on February 21 and will close on February 28. SBI is looking at raising 2,000 crore through tier II bonds, with an option to retain oversubscription of up to 10,000 crore. It has reserved up to 50 per cent




for retail applicants, the remaining to be divided amongst high networth individuals and institutional investors. A retail applicant can invest up to Rs 5lakh (50 bonds) in this issue. SBI is offering an interest of 9.75 per cent and 9.95 per cent for 10-year and 15-year bonds, respectively.

23-Feb-2011

State Bank Of India - Appointment of Director : State Bank Of India has informed the Exchange that 'In exercise of the powers conferred by clause (e) of Section 19 of the State Bank of India Act, 1955 (23 of 1955), the Central Government has nominated Shri. Shashi Kant Sharma, Secretary, Department of Financial Services, Ministry of Finance, a Director on the Central Board of Directors of State Bank of India from the date of notification and until further orders vice Shri Ashok Chawla'.

22-Feb-2011 BS

SBI now signatory to Carbon Disclosure Project : State Bank of India (SBI), the

country's largest lender, today became a

signatory investor to the Carbon Disclosure Project (CDP), a collaboration

of 550 global institutional investors with assets under management to the

tune of $71 trillion.

CDP is an independent non-profit organisation, holding the largest database

of primary corporate climate change information in the world.

Over 3,000 organisations across the world's largest economies measure and

disclose their greenhouse gas emissions and climate change strategies

through CDP. These disclosures aid them in setting reduction targets and

improve performance. SBI, on its part, had been undertaking several

environmentally and socially sustainable initiatives through its 14,000 plus

branches spread across the length and breadth of the country. It has also

enunciated a Green Banking Policy' in 2007. Therefore, a partnership with

CDP only reiterated its resolve and commitment towards sustainable

development, said SBI chairman O.P. Bhatt.

'Our bank was the first in the entire banking, insurance and financial services

sector to have conceptualised and owned wind farms for the generation of

green power. The same partly substituted the thermal power used by our

offices in India. We have already launched a project to measure and manage

organisational foot print to achieve carbon neutrality,' he added.

Paul Simpson, CDP's chief executive said, 'We are delighted to welcome

financial powerhouse SBI as a signatory. As most of the world's economic

recovery will now come from emerging economies like India, it was crucial

for us to have a strong partner like SBI to promote the truly global fight




for sustainable development.'

'We are pleased SBI has become a signatory, as this conveys a strong

message to the Indian financial sector and the strategic role it can play

in promoting a sustainable future' said Ravi Singh, secretary general and

CEO of WWF-India.

'Being a major bank, SBI stands to become a great catalyst in encouraging

the adoption of sustainable strategies by businesses and the financial sector.

We congratulate SBI on becoming a signatory to CDP; this is a very important

milestone for the initiative' said Seema Arora, principal counsellor & head of

CII-ITC Centre of Excellence for Sustainable

Development.

Each year, on behalf of signatory investors, CDP collects climate change

and carbon emission data from over 5,000 large companies globally,

including the top 200 companies listed on the National Stock Exchange

(NSE).

Over 550 institutional investors -- ranging from pension funds and insurance

companies like Allianz and Swiss Re to blue-chip banks and asset managers

such as Black Rock, HSBC, Goldman Sachs and Morgan Stanley -- are

signatories.

In India, investors like HDFC Bank, IDBI, IDFC, Reliance Capital, Tata Capital,

IndusInd Bank and YES Bank have also become signatories. CDP sends an

annual letter and a questionnaire on behalf of these financial institutions to

the top 200 Indian companies by market capitalisation. In 2010, 51

companies responded to the questionnaire.

In the disclosure, Indian companies reported on their carbon emissions data,

reduction targets, associated risks and opportunities and increasing board-

level managerial resources in spearheading the execution of climate change

strategies within their organisations.

22-Feb-2011

Big shift SBI moves ahead of HDFC in home loans : The biggest bank in the country is also its top home loan lender. State Bank of India (SBI) has finally pulled ahead of its long-time, neck-and-neck competitor, the Housing Development Finance Corporation (HDFC). At the end of December 31, 2010, outstanding loans in the retail segment stood at 82,376 crore for SBI, around 11% higher than HDFC's 74,155 crore. Outstanding retail home loans make up about 13% of SBI's total outstanding loans. As per a report released by Icra in June 2010, HDFC Group and SBI had marketshare of 17% each, based on loans outstanding as of March 31, 2010. In fact, together withICICI Bank



(along with ICICI Home Finance) and LIC Housing Finance, they accountedfor 55% of total housing credit in thecountry. A senior SBI official conceded that continuing the teaser scheme helped the bank pull ahead of its closest competitor. 'To a large extent, I agree it was due to the extension of teaser loans. But the product had value for the customers.' SBI is still running the teaser loans scheme and plans to continue it even after March 31, 2011 as the response has been pretty good. The final decision on this will be taken in March, the official said. For HDFC, the retail portfolio works out to 68% of its outstanding loans of 1,09,051 crore as on December 31, 2010. According to a company spokesperson, this does not include 11,631 crore of loans securitised (including which the retail book would be higher). Similarly SBI's retail portfolio of 82,376 crore does not include loans securitised by the bank. HDFC was offering teaser loans till last November, but discontinued the scheme after the Reserve Bank of India raised concerns about the teaser rate scheme fearing it might increase home loan defaults in the times to come. Under the schemes offered by HDFC, interest rates were 8.50% for the first year (till March 2011), 9.25% for the second year (March 2012) and at floating rate thereafter. Another factor which dampened sentiments for HDFC was that from December 1, just the day after discontinuing teaser loans, the retail prime lending rate was jacked up by 75 basis points. On its part, under the teaser loan it was offering till December 31, 2010, SBI charged interest at 8% for the first year, 9% for the second and third years and at a floating rate thereafter. The bank has since linked the teaser loans to its base rate, which currently stands at 8.25%. 'We have never chased market share. We are always for growth, which is manageable without compromising the loan quality or customer service quality,' said the HDFC spokesperson. As per RBI data, the housing loans outstanding as on December 17, 2010 were 3,32,533 crore, up 13.24% year on year. As on December 19, 2008 the figure stood at 2,73,071 crore.

20-Feb-2011 ET

SBI bonds good for those with long-term view : After the huge success it saw in its first issue in October 2010, the State Bank of India has come up with its second tranche of retail bonds. The size of the issue is Rs 1,000 crore, with an option to retain an extra Rs 1,000 crore. Allotment of these bonds will be done on afirst-come-first serve basis, based on the date of the application. The issue opens on February 21 and closes on February 28. THE PRODUCT The bonds are available in two series with diverse maturities: Series 3 will



have a maturity of 10 years, with an interest of 9.75% for retail investors and 9.3% for high net worth investors (HNIs) and qualified institutional buyers (QIBs). Series 4 will have a maturity of 15 years, with an interest rate of 9.5% for retail investors and 9.45% for HNIs and QIBs. The face value of each bond is Rs 10,000 and one can apply for a minimum of one bond. The maximum size of application under the retail category is Rs 5 lakh and 50% of the issue size is reserved for retail applicants while the balance 25% is for HNIs and 25% for QIBs, respectively. These bonds are not secured and don't have any lock-in. The bonds will be available only in the demat mode and it will be listed on the BSE and the NSE. While Series 3 bonds have a tenor of 10 years with a call option by SBI after five years, series 4 bonds have a tenure of 15 years with a call option after 10 years. The bonds are not redeemable at the option of the bondholder or without the prior consent of the central bank. WHO SHOULD APPLY Investors with a long-term view, seeking periodic returns from debt products with strong safety of principal and high liquidity, could consider these bonds. Currently, bank fixed deposits pay anywhere between 8.5% and 9% per annum for a 10-year fixed deposit. SBI bonds are paying about 100 basis points higher to retail investors. The issue is rated 'AAA' by Crisil and CARE, which indicates the highest safety. The previous issue of SBI bonds closed on the first day was oversubscribed about 17 times on the first day. Distributors expect this issue to get a good response too, and hence, investors interested in the issue should apply early. WHY NOT TO APPLY In case investors want to sell the bonds mid-way, the only way out would be the stock exchange. Bond prices could fluctuate with interest rates. So, if interest rates move upward, bond prices could go lower and you could suffer a capital loss. Similarly, if interest rates move downward, bond prices could move up and you could have a capital appreciation. There is also no put option available to investors, and in case the call option is not exercised, there is no step-up coupon rate. There are no tax benefits available and the income received shall be treated as income from other sources and taxed accordingly.

20-Feb-2011 TE

SBI to launch bond issue on Monday : the country's largest bank, State Bank of India, is launching its second tranche of long-term bonds on Monday in which retail investors can get a rate of interest as high as 9.95% per annum. The bank is launching its bond offering to raise up to Rs 2,000 crore, in which investors have the option to invest either for 10 years or for 15 years, with



the shorter durations bonds offering 9.75% rate of interest, while the longer duration ones giving 9.95%. However, interest income from these bonds are taxable in the hands of the investors. Also, the bank will offer lower rates of interest for non-retail investors, which will be 9.30% and 9.45%, respectively for 10-year and 15-year papers. The current offering is part of SBI's planned fund raising programme aggregating Rs 10,000 crore through bonds during financial years 2010-11 and 2011-12. Speaking to reporters, O P Bhatt, chairman, SBI, said that the bank has plans to tap investors through similar bond offerings every quarter. This offering will help the bank shore up its Tier 2 capital. SBI's bond offering, which will open on February 21, will close on February 28, and these will be listed on the debt segments of NSE and BSE.

19-Feb-2011 BS

Interest rates near peak level: SBI chief : Hinting that interest rates may have little room left to move up, State Bank of India (SBI) Chairman O P Bhatt today said rates were ruling near the peak level. Interest rates had peaked or were near the peak levels, he said, adding they may not come down immediately. He was addressing reporters on its retail bond issue. The country's largest lender is set to raise up to 10,000 crore through bonds. The bank will issue series III lower Tier-II bonds of face value of 10,000 each and series IV lower Tier-II bonds of face value of 10,000 each, aggregating 1,000 crore, with an option to retain over-subscription. The tranche I issue will be opened from February 21 to February 28 for subscription. These bonds are proposed to be listed on the Bombay Stock Exchange and the National Stock Exchange. Retail applicants will get interest at the rate of 9.75 per cent per annum on series 3 lower Tier-II bonds and 9.95 per cent in case of series 4 lower Tier-II bonds. Non-retail applicants will get 9.3 per cent and 9.45 per cent, respectively. There is no put option and step-up coupon

19-Feb-2011 BL

SBI plans retail bond issues every quarter : State Bank of India is planning to tap retail investors every quarter with bond issues for mobilising long-term resources. India's biggest lender had raised Rs 1,000 crore through its maiden issue of retail bonds in the last quarter. In the current quarter, it is seeking to mobilise about Rs 10,000 crore through these bonds. The latest offering of the bonds (also called Lower Tier II bonds) will be open from February 21 to 28. “Our maiden issue of retail bonds got subscribed 19 times in the last quarter (October). We are now coming out with another issue in the current quarter. Hopefully, we will continue to come out with bond issues every quarter,” said Mr O.P. Bhatt, Chairman, SBI.




SBI intends to deploy the issue proceeds to augment its capital base. Its capital adequacy ratio, which as of December-end 2010 stood at 13.16 per cent, will improve by 100 basis points (or one percentage point). It will also go a long way in addressing the asset-liability maturity mismatches. The bonds will be issued in two series — one will have a tenure of 10 years (with the bank having the option to call the bonds after five years) while the other will have a tenure of 15 years (call option after 10 years). Each bond has a face value of Rs 10,000. Retail investors, that is, those investing up to Rs 5 lakh, will earn 9.75 per cent on 10-year bonds and 9.95 per cent interest on 15-year bonds. Non-retail investors will earn 9.30 per cent on 10-year bonds and 9.45 per cent interest on 15-year bonds. Unlike the maiden retail bond issue, investors in the forthcoming issue will not enjoy the benefit of step-up interest rate as the banking regulator has disallowed it. Under the new Basel accord on bank capital adequacy and liquidity, bonds with the step up interest rate option cannot be treated as part of Tier-II capital. “The step-up option is no longer permitted by the RBI,” said Mr Hemant Contractor, Deputy Managing Director and CFO. In its maiden retail bonds issue, the bank had offered investors step-up option of 50 basis points (that is, they could earn 0.50 percentage points higher interest a year) in case it does not exercise call option after 5 years (for bonds of 10 years maturity) and 10 years (for bonds of 15 years maturity). The bank had then issued the 10-year bonds at 9.25 per cent interest and 15-year bonds at 9.50 per cent interest. Only investors having dematerialised (demat) accounts can subscribe to the retail bonds issue. Besides its own collection centres (126 of them), the bank is relying on lead brokers — Citigroup Global Markets, Kotak Securities and SBICAP Securities — to sell the issue. Given that many investors had missed the bus during the maiden bond issue, when it was closed in three days, the bank will keep the issue open till the last day. Meanwhile, SBI expects to end the financial year with an incremental credit-deposit ratio of over 100 per cent. However, the bank will not curb its loan growth to bring down the C-D ratio, said Mr Bhatt. The RBI, in its January policy meeting, said it will monitor banks that show an excessively high incremental C-D ratio.


19-Feb-2011 FE

RBI may increase policy rate by 25 bps, says Bhatt : SBI chairman OP Bhatt on Friday has said that the interest rates are unlikely to harden further. Still, I do believe that if the situation on inflation front continues to remain at the present level, then the Reserve Bank of India(RBI) may increase key policy rates by 25 basis points,'' said Bhatt. SBI has an incremental C-D ratio of 105-106% and it was not likely to come down until the end of the current fiscal. It was basically due to the liquidity overhang. In fact the rate of credit growth will continue to outpace deposit growth until March. We expect a credit growth of 18% and deposit growth of 17% for the entire fiscal, he said. Bhatt said the bank was waiting for the approval for its Rs 20,000 crore rights issue to come from the government. The bank launched its Rs 2,000 crore retail bond issue. The issue is opening on February 21 will close on February 28. It is almost similar to the bond which was issued by our bank last year. Only the difference is that there is no step-up option this time thanks to the new RBI norms on the issue.'' he said. The idea behind the bond is to shore up bank's Tier-I capital and increase it to 4.59% from the existing 3.59%. Secondly, it would enable the growth of the corporate bond market. Thirdly, the bank was offering another product to its retail investors. The applications will be accepted by 126 branches that we have currently with demat account facility. We want to come up with the retail bond every quarter if the market permits us to do so. It also helps us to address asset liability gap. I hope other banks will also start issuing the retail bonds now, like us,'' he said.

19-Feb-2011 IE

State Bank chief Bhatt doesn't see big policy rate hike : State Bank of India chairman OP Bhatt on Friday has said that the interest rates are unlikely to harden in a big way. Still, I do believe that if the situation on the inflation front continues to remain at the present level, then the Reserve Bank of India (RBI) may increase key policy rates by 25 basis points,'' Bhatt said. SBI has an incremental credit-deposit ratio of 105-106 per cent and it was not likely to come down until the end of the current fiscal. It was basically due to the liquidity overhang. In fact, the rate of credit growth will continue to outpace deposit growth until March. We expect a credit growth of 18 per cent and deposit growth of 17 per cent for the entire fiscal,'' he said. Bhatt said the bank was waiting for the approval of its Rs 20,000 crore rights issue to come from the government. The bank launched its Rs 2,000 crore




retail bond issue. The issue which is opening on February 21 will close on February 28. It is almost similar to the bond issued by our bank last year. Only the difference is that there is no step-up option this time thanks to the new RBI norms on the issue,'' he said. The idea behind the bond is to shore up bank's Tier-I capital and increase it to 4.59 per cent from the existing 3.59 per cent. Secondly, it would enable the growth of the corporate bond market. Thirdly, the bank was offering another product to its retail investors. The applications will be accepted by 126 branches that we have currently with demat account facility. We want to come up with the retail bond every quarter if the market permits us to do so. It also helps us to address asset liability gap. I hope other banks will also start issuing the retail bonds now, like us,'' he said. The bank's initial bond issue of Rs 1,000 crore was a huge success in last October, which was snapped up 19 times. The latest issue is part of its planned Rs 10,000-crore retail bond issue. SBI CFO Hemant Contractor said these lower Tier II bonds are being issued in two series -- Series 3 and Series 4. Series 3 bonds have a tenor of 10 years with a call option by SBI after five years and a coupon rate of 9.75 per cent for retail and 9.30 per cent for non-retail applicants. Series 4 bonds have a tenor of 15 years and a coupon rate of 9.95 per cent for retail and 9.45 per cent for non-retail investors. He said the bond issue will not be redeemable at the option of bond holders or without prior RBI permission.

17-Feb-2011 BS

O P Bhatt's Mission accomplished : The chairman's angst sums up the public display of the uneasy relationship between the country's largest bank -- State Bank of India -- and the Reserve Bank of India (RBI), in the last couple of years over several issues, including the so-called teaser home loan rates (Bhatt, of course, has serious reservations over the term. He says he is not teasing anybody), higher provisioning coverage, guarantee to bonds issued by Tata Motors, etc. But more of that, later. Even his worst detractors can't deny that Bhatt, who is due to retire in March after a five-year term, has been able to turn SBI from a lethargic elephant to one that can dance. When he took over the reins in June 2006, the usual lament about SBI was: 'It is too slow and past its prime. Soon, the nimble-footed private banks will go ahead.' The numbers supported this argument. ICICI Bank was a serious threat. In June 2006, SBI's total business stood at 639,817 crore. ICICI,



though behind, was closing in with a much faster growth rate. Its total business stood at 330,490 crore. Analysts assumed it was only a matter of time - may be, another five years - before the private sector bank became the number-one bank in the country. Bhatt's appointment wasn't a smooth affair, either. Yogesh Agarwal, then managing director of State Bank of Patialia, was considered a strong contender for the top position. But Bhatt pipped him to the post. Though Agarwal became the managing director of SBI in October, he moved to head IDBI Bank in July 2007. Internally, the bank was grappling with many issues. For one, it had serious software problems that were not allowing it to roll out core banking solutions. This had to be addressed on a war footing, since core banking solutions were the backbone required for any scaling up and offering value-added services to corporate clients. Bhatt evaluated the situation for the first three months. Then, he asked the software vendor, Tata Consultancy Services, to rectify the glitches. Then, the business process re-engineering process plan was started at branches. This involved training every staff and redesigning the layout of branches to make work a little better, faster and cheaper. He put in place capital-raising plans to support growth for the next four-five years. SBI raised 16,000 crore in March 2008 through rights issue. At present, the bank has been working on another rights issue to raise about 20,000 crore by March. Banking analysts say this capital should support its growth plans for another five years. 'SBI has recorded a consistent growth in business in the last four years. The credit to deposit ratio of 77 per cent indicates efficient deployment of resources,' said D R Dogra, managing director of ratings agency CARE. Other important measures include an aggressive focus on the retail customer (the introduction of teaser loans being one such example); Parivartan I and II -- programmes for employee motivation and skill set improvement; Udan -- preparing a pipeline of future leaders at both senior and middle levels. These have improved the perception of SBI among both peers and analysts. He resumed clerical recruitment, which had been frozen for over a decade, in view of growing business. Importantly, the process of consolidation within the SBI associates was started. He merged State Bank of Saurashtra and State Bank of Indore with SBI. 'This will improve the bank's operating efficiencies,' added CARE's Dogra. Many, however, say the SBI chairman could have handled his relationship with the regulator with a little more finesse. 'He could have easily avoided the in-your-face and aggressive approach with the regulator. That had to deal with the banking industry as a whole,' said an observer. But Bhatt remains adamant and says he has done nothing wrong. 'Many Indians own homes because of SBI. I am not fighting with RBI, but only clarifying... we only gave discount on the rate for the first two-three years and at higher than the cost of my funds. So what is wrong in what SBI does?' Bhatt said, while admitting that there were quite a few other issues on which he 'differed' with the regulator. Besides the teaser loan, the bank faced regulatory ire for guaranteeing Tata Motors' debenture issue of


10,000 crore and overall provisioning of 70 per cent for bad loan portfolio. The empire struck back. RBI was highly critical of the bank's performance, including its financial health. Consequently, it downgraded the bank's CAMEL (capital, asset quality, management, earnings, liquidity and systems and control) ratings from B to B- in an internal report for the year ended March 2009. There were internal rumblings too. When Bhatt restructured operations at state-level units, popularly known as circles, by dismantling a decision-making layer (zone) headed by deputy general managers, there was again a lot of criticism. While work would be sped up by cutting on red tape, it put immense pressure on general managers. The jury is out on whether or not this has made the bank more efficient. A top official of the bank, under condition of anonymity, says: 'Bhatt has improved the bank's image and introduced aggressiveness. The performance, in terms of market share, speaks for itself.' In the same breath, however, the official admits that the down side of his leadership style has, perhaps, weakened the collective decision-making culture at SBI. The good news: SBI continues to be at the top of the table. In December 2010, SBI's total business stood at Rs16,19,950 crore, compared to ICICI Bank's 424, 439 crore. Of course, ICICI Bank took a conscious decision to shrink its balance sheet size to manage the adverse effects of exponential growth and global financial crisis. Jamal Mecklai, chief executive of Mecklai Financials, says: 'During Bhatt's regime, SBI has become more competitive in a market (like money and foreign exchange markets, and advisory services) where foreign banks and Indian private banks were very active. This helps expand the revenue base.' The fear: His aggressive style may have compromised the bank's standing with RBI. In addition, some of the asset quality, especially the restructured portfolio (part non-performing assets and part standard assets) may be concerns in the future and hurt profitability - a big challenge for the next chairman. But on March 31, when Bhatt retires as chairman, he will have one satisfaction - no one calls SBI laid back anymore.

16-Feb-2011 ET

Postman to turn banker in rural areas : The postal department and the country's largest lender, State Bank of India (SBI), are gearing up to take basic banking services to the doorsteps of millions of people in rural areas who have no access to the country's banking system. The tie-up will see postmen acting as banking correspondents for SBI in over 12,000 villages, collecting deposits and offering small credit and remittance facility to people in far-flung areas. Villagers in these areas currently have no option but to keep hard-earned money at home, losing out on interest and running the risk of theft. SBI, which has around 5,000 branches in rural or semi-urban areas, hopes to cover 12,492 villages by 2012. To meet this intiative a tie-up with India Post will be a great advantage, a senior SBI official said. The business



correspondent model, set up by the Reserve Bank of India, allows specific individuals and entities such as 'kirana' shop-owners , NGOs and post offices to conduct banking business as agents of banks at places other than the bank premises. India Post has a network of over 1.5 lakh branches. A finance ministry official said the government was keen on such initiatives because of the postal network's reach. We have encouraged banks to explore similar tie-ups to speed up the financial inclusion agenda, he said. Last week, the finance minister had alerted banks to the risks involved with not choosing the right kind of business correspondent. A senior postal department official said, India Post, or its employees, are undoubtedly the most reliable partners for any bank. However, not everyone is convinced that India Post makes for the best partner. What if tomorrow the government grants them (India Post) a banking licence? RBI had directed that there should be a business continuity plan (BCP) in place to ensure uninterrupted service... it will be very difficult to find a replacement for such a partner, said a senior executive of Punjab National Bank said.

16-Feb-2011 ET

SBI to offer 15-year retail bonds at 9.95% : State Bank of India will sell bonds to retail investors offering returns of 9.75% and 9.95% on 10- and 15-year bonds, respectively. In a letter to the Bombay Stock Exchange, the bank said its central board has approved raising funds through the issue of subordinated debt (lower tier II bonds). It has approved selling bonds worth Rs 1,000 crore, with an option to retain oversubscription of up to Rs 1,000 crore. In case of retail demand, SBI can retain the oversubscription beyond Rs 2,000 crore up to Rs 10,000 crore. This time around the bank is offering different rates for retail and non-retail investors. Non-retail investors, who include institutions and high net-worth individuals who invest in bulk, will receive 9.3% for 10 years and 9.45% for 15-year investments. The bank also has an option to pre-pay investors in the 10-year bonds after 5 years and after 10 years for 15-year bondholders. Senior officials of the bank said that details regarding the opening of the issue would be announced on Tuesday. Although these investments are long-term in nature, investors are assured liquidity through the listing of these bonds. Investment bankers who are distributing the issue say earlier experience suggests that SBI is bound to receive a huge oversubscription on the first day itself. There are many banks that are offering 9.5% and above on fixed



deposits. But these investments typically are for one-two years and interest rates are widely expected to come down in the long-term, said an investment banker. SBIs earlier retail bond issue, which offered a much lower return, was a huge success with the bonds being sold out on the first day. Successful investors got an opportunity to make equity-like gains as the bonds were listed at a 5% premium on listing. While the returns on the bonds are even better, the listing position would depend on the extent of unsatisfied demand in the public issue. Prices of SBIs earlier bonds fell marginally on Monday, but the securities continue to trade at a significant premium over the issue price. Although the size of the issue is minuscule compared to the banks balance sheet, the issue is part of an ongoing programme to develop a market for long-term resources. The bank presently funds all its long-term loans, which include home loans and loans to the infrastructure sector, through core savings deposits and medium-term deposits. The long-term bonds will enable the bank to match some of its long-term fixed liabilities.

16-Feb-2011 FE

SBI to launch retail bond issue : State Bank of India is expected to launch the first tranche of its Rs 10,000 crore retail bond issue on Monday. The first tranche, in which the bank is raising up to Rs 2,000 crore, would close on February 28. A senior bank official said that the bank will hit the market with a Rs 2,000-crore bond issue from February 21.'These bonds will be of two maturities -10 and 15 years. While the 10-year bonds will offer a coupon of 9.75% to the retail investor, the 15-year bond will fetch 9.95% to him. The bonds, that will be opened on February 21 and closed on 28, will be listed on both the BSE and NSE,' the official added.

16-Feb-2011 TE

SBI has option of pre-payment : State Bank of India will offer different rates of returns on bonds for retail and non-retail investors. Non-retail investors, who include institutions and high net-worth individuals who invest in bulk, will receive 9.3% for 10 years and 9.45% for 15-year investments. The bank has an option to pre-pay investors in the 10-year bonds after 5 years and after 10 years for 15-year bondholders. Senior officials of the bank said that details regarding the opening of the issue would be announced on Tuesday. Although these investments are long-term in nature, investors are assured liquidity through the listing of these bonds. Investment bankers who are distributing the issue say earlier experience suggests that SBI is bound to receive a huge oversubscription on first day itself. “There are many banks that are offering 9.5% and above on fixed deposits. But these investments typically are for one-two years and interest




rates are widely expected to come down in the long-term,” said an investment banker. SBI's earlier retail bond issue, which offered a much lower return, was a huge success with the bonds being sold out on the first day. Successful investors got an opportunity to make equity-like gains as the bonds were listed at a 5% premium on listing. While the returns on the bonds are even better, the listing position would depend on the extent of unsatisfied demand in the public issue. Prices of SBI's earlier bonds fell marginally on Monday, but the securities continue to trade at a significant premium over the issue price. Although the size of the issue is minuscule compared to the bank's balance sheet, the issue is part of an ongoing programme to develop a market for long-term resources. The bank presently funds all its long-term loans, which include home loans and loans to the infrastructure sector, through core savings deposits and medium-term deposits.

15-Feb-2011 FE

SBI to offer 9.95% on 15-yr retail bonds : State Bank of India on Monday said it would offer an interest rate of 9.95% for 15-year retail bonds. In a notice to the stock exchanges, India's biggest lender said it would pay a rate of 9.75% for retail bonds that will mature in 10 years. Non-retail investors will get a rate of 9.3% for 10-year bonds and 9.45% for 15-year bonds. The issue is expected to hit the market towards the end of the month. S Vishvanathan, MD and CEO, SBI Capital Markets, said, The bonds are meant for a larger audience. We are bringing in the concept of raising resources through the bond route for longer maturities. SBI, which enjoys a AAA rating, said it planned to mop up to Rs 2,000 crore through the issue of bonds, which would qualify as tier II capital for the bank. While the 10-year bonds have a call option after five years, the 15-year bonds can be recalled after 10 years. At present, SBI offers a maximum interest rate of 9.25% on term deposits for 555 and 1,000 days as also on deposits with a maturity of 8-10 years. Unlike infrastructure bonds, these bonds are taxable. In the case of infrastructure bonds, investors are eligible for a tax break for an investment of upto Rs 20,000. In October last year, SBI raised Rs 1,000 crore through a maiden retail bond offering. The issue was ovsersubscribed by 20 times since



it offered a rate of 9.25% for 10-year and 9.5% for 15-year money. The bonds are listed and traded on the stock exchanges and DFHI is the market maker.

15-Feb-2011 TE

SBI to offer 15-year retail bonds at 9.95% : State Bank of India will sell bonds to retail investors offering returns of 9.75% and 9.95% on 10- and 15-year bonds, respectively. In a letter to the Bombay Stock Exchange, the bank said its central board has approved raising funds through the issue of subordinated debt (lower tier II bonds). It has approved selling bonds worth Rs 1,000 crore, with an option to retain oversubscription of up to Rs 1,000 crore. In case of retail demand, SBI can retain the oversubscription beyond Rs 2,000 crore up to Rs 10,000 crore. This time around the bank is offering different rates for retail and non-retail investors. Non-retail investors, who include institutions and high net-worth individuals who invest in bulk, will receive 9.3% for 10 years and 9.45% for 15-year investments. The bank also has an option to pre-pay investors in the 10-year bonds after 5 years and after 10 years for 15-year bondholders. Senior officials of the bank said that details regarding the opening of the issue would be announced on Tuesday. Although these investments are long-term in nature, investors are assured liquidity through the listing of these bonds. Investment bankers who are distributing the issue say earlier experience suggests that SBI is bound to receive a huge oversubscription on the first day itself. 'There are many banks that are offering 9.5% and above on fixed deposits. But these investments typically are for one-two years and interest rates are widely expected to come down in the long-term,' said an investment banker. SBIs earlier retail bond issue, which offered a much lower return, was a huge success with the bonds being sold out on the first day. Successful investors got an opportunity to make equity-like gains as the bonds were listed at a 5% premium on listing. While the returns on the bonds are even better, the listing position would depend on the extent of unsatisfied demand in the public issue. Prices of SBIs earlier bonds fell marginally on Monday, but the securities continue to trade at a significant premium over the issue price. Although the size of the issue is minuscule compared to the banks balance sheet, the issue is part of an ongoing programme to develop a market for long-term resources. The bank presently funds all its long-term loans, which include home loans and loans to the infrastructure sector, through core



savings deposits and medium-term deposits. The long-term bonds will enable the bank to match some of its long-term fixed liabilities.

14-Feb-2011

Other announcement of State Bank Of India, : State Bank of India has informed BSE about augmentation of Tier II Capital through Public Issue of Bonds. Announcement : 'We refer to our letter no. dated December 30, 2010 vide which we had advised that Executive Committee of the Central Board of the Bank had accorded approval for raising Tier II Capital for an aggregate amount of Rs.10,000 crore by way of Public Issue of Subordinated Bonds (Lower Tier II Bonds) during the remaining period of FY 2010-11 and in FY 2011-12, in different tranches and also for raising of Rs. 1.000 crore with an option to retain oversubscription upto Rs.1,000 crore, along with an option to retain oversubscription under the Retail Category beyond Rs.2,000 crore but up to the rated amount of Rs.10,000 crores, in the first tranche. In this connection, we advise that the Executive Committee of the Central Board of the Bank at its meeting held on February 11, 2011 has accorded approval for raising first tranche of Public Issue of Lower Tier- II Bonds with the following terms: (A) Series 3 Lower Tier II Bonds - Tenure : 10 Years with a call option after 5 years - Rate of Interst (%) per annum payable annually (Non Retail) : 9.30 - Rate of Interst (%) per annum payable annually (Retail) : 10.00 (B) Series 4 Lower Tier II Bonds - Tenure : 15 Years with a call option after 10 years - Rate of Interst (%) per annum payable annually (Non Retail) : 9.45 - Rate of Interst (%) per annum payable annually (Retail) : 10.25 The details will be available in Shelf Prospectus to be read with Tranche 1 Prospectus'

12-Feb-2011 ET

SBI to hit bond market again to raise Rs 2000 cr : The State Bank of India plans to sell retail bonds once again to raise Rs 2,000 crore even as it awaits the government clearance for its proposed Rs 20,000-crore rights issue of shares. SBI managing director R Sridharan said the bank is likely to hit the retail market by the end of this fiscal. These bonds have a longer tenure up to 15 years and qualify for tier-II capital. He was in Kolkata to attend at an event organised by Ficci. Mr Sridharan did not specify the size of the bond programme but market sources said it would be in the range of Rs 2,000 crore. The bank has decided to tap this route yet again, enthused by the response it received for its maiden retail bond sale of Rs 1,000 crore in October 2010. The issue was oversubscribed by 20 times as investors were lured by high returns. The bank had offered 9.25% on a 10-year bond and 9.5% on a 15-year bond.




Market sources said SBI is likely to offer higher coupons on the proposed issue as interest rates hardened further since October. SBI has itself hiked deposit rates a couple of times and is offering 9.25% for deposits for 555 days and 1,000 days. Despite the success of the retail bonds, no other bank has yet tried out this option as they find this costly. “We could not understand why SBI offered such high rates,” a treasury head with a Mumbai-based public sector bank said. While SBI is working out the details of the retail bond plan, it has garnered 325 million Swiss franc (around Rs 1,500 crore) via an international bond programme to meet its increasing foreign currency needs. It was a medium-term notes (MTN) issue in the form of senior debt fixed rate bonds with a maturity of five years.

12-Feb-2011 FE

State Bank raises rates by 25 bps : State Bank of India on Friday hiked its lending and deposit rates by 25 basis points. The bank has hiked its base rate and benchmark prime lending rate (BPLR) by 25 basis points to 8.25% and 13%, respectively. It has also hiked interest rates on deposit by 25 basis points across maturities. The bank last hiked its lending rates on December 31, 2010. Talking to FE a senior SBI official said that there would be a marginal impact on the bank's net interest margin (NIM) by 1 or 2 bps only as the bank raised deposit rates in the two of its most popular term deposits. The bank's NIM as on December 31 was at 3.4%. The impact on the cost of fund of the bank would also be a marginal, may be by 2 bps as the current fiscal year was on the verge of closure. The bank was maintaining its credit deposit ratio at 74%. The official added that the deposit growth of the bank was constantly improving and it would itself take care of the moderation in bank's credit growth. It's unlikely that a 25 basis points hike should impact credit offtake, said the bank's senior executive. Meanwhile, SBI expected 19% credit growth this financial year. Credit growth will take between 18% and 19% in the current fiscal, SBI managing director R Sridharan told reporters on the sidelines of a Ficci meet on Friday. About infrastructure financing, he said SBI's maximum exposure would be Rs one lakh crore. The bank would again come out with a retail bond issue by the end of the current fiscal, he said.



Compared to other banks in the public sector, SBI has one of the lowest loan rates, which makes PSU banks a tad concerned about credit growth. Bank of Baroda, ED, RK Bakshi, executive director, The recent round of rate hikes could act as a dampener and affect credit growth in the long run . Overall credit growth would also slowdown to around 20% or lower because of the base effect. As in the March quarter last year, we had seen a bumper growth in credit. However, this is not a concern as the Reserve Bank of India is worried about the deposit growth not keeping pace with the growth in credit.'' Meanwhile, credit offtake continues to remain fairly strong. For the fortnight ended January 28, 2011, the increase in non-food credit has been 23.1% year-on-year, at Rs 37,85,998.62 crore. This is line with the year-on-year growth seen in the previous fortnight though a tad lower than the increase seen in the fortnight ended December 31, 2010. The latest round of rate hikes was kicked off by Punjab National Bank on January 31. Since then more than half a dozen banks have made money more expensive. Many others like Kotak Mahindra Bank have raised rates on deposits. HDFC Bank had recently hiked its auto loan rates by 50 bps.

12-Feb-2011 CN State Bank of India increases its base rate :

12-Feb-2011 CN State Bank of India increases its BPLR

12-Feb-2011 IE SBI hikes rates by .25 per cent

10-Feb-2011

Other announcement of State Bank Of India, : State Bank of India has informed BSE that the Bank has concluded an issue of CHF 325 Mio Senior Debt, Fixed Rate Bonds, under the Medium Term Note (MTN) Programme, having a maturity of 5 years at a coupon rate of 3.375% p.a. payable annually in the form of Regulation-S Global Notes. The bonds will be issued through the Bank's London branch as of February 22, 2011 and shall be listed on Six Swiss Exchange.

10-Feb-2011

State Bank Of India - Updates : State Bank Of India has informed the Exchange that the Bank has concluded an issue of CHF 325 Mio Senior Debt, Fixed Rate Bonds, Under the Medium Term Note (MTN) Programme, having a maturity of 5 years at a coupon rate of 3.375% p.a. payable annually in the form of Regulation-S Global Notes. The bonds will be issued through Bank's London branch as of February 22, 2011 and shall be listed on Six Swiss Exchange.

9-Feb-2011 ET SBI rules out immediate increase in deposit rates : The State Bank of India will not raise deposit rates in the near term like other banks which are attempting to correct an asset-liability mismatch with loan growth








outstripping growth in deposits. SBI chairman OP Bhatt told ET that his bank was not planning to raise deposit rates as of now. The country's largest bank has raised deposit rates thrice in the past six months. The bank offers an interest of 9% on deposits for 555-days and for 1,000 days. Mr Bhatt said SBI was targeting a loan growth of 22% and a 20% growth in deposits at a time when it is growing its deposits by 16% and loans by 18% YoY. Last month, RBI had raised concerns relating to the gap between deposit and loan growth and the inclination of banks to borrow short term to fund long-term loans. For the banking industry, deposits rose by close to 16% while loans grew 24%. However, top bankers had said there were unutilised deposits last year in the banking system, which is now being deployed for lending. Mr Bhatt said SBI has started lending to microfinance institutions and plans to restructure MFI loans in Andhra Pradesh, where the sector suffered a jolt after the government issued an Ordinance restricting coercive practices and capping interest rates. We are looking at restructuring of MFIs on a case-to-case basis, he said during his visit to Guwahati. SBI's business in the North-East has crossed 50,000 crore. The region contributes close to 4% of the bank's total business. It plans to add 18 new branches to the tally of 538 in the region to consolidate its position here besides installing another 90 ATMs, which will take the number to 850.

8-Feb-2011 FE

H G contractor is SBI's new CFO : State Bank of India appointed deputy managing director HG Contractor as new Chief Financial Officer (CFO) of the bank. Contractor has taken over as new CFO in place of S S Ranjan, SBI informed the Bombay Stock Exchange. He was looking after corporate banking prior to taking this new assignment.

8-Feb-2011 CN H G Contractor takes charge as CFO of State Bank of India

8-Feb-2011

Other announcement of State Bank Of India,

8-Feb-2011

State Bank Of India - Appointment of Chief Financial Officer

7-Feb-2011 BL

SBI to cover 12,421 unbanked villages by March 2012 : State Bank of India plans to cover 12,421 unbanked villages by March 2012 under its Financial Inclusion Plan. Under the plan, the bank seeks to cover 5,357 unbanked villages up to March 2011. Up to January 31, it has covered 2,017 villages with population of 2,000 and above, the bank said in a statement. SBI has adopted a three pronged strategy — of opening as many new branches in rural and semi-urban areas as possible, setting up customer service points by appointing business correspondents/facilitators across the country and







16 Misc

A few current national & international issues

1. BASEL III

2. CDM : Clean Development Mechanism

3. IFRS

4. Fiscal Consolidation

5. Rewriting banking law : India

6. Green Banking

7. PCR

8. Price stability

9. Stimulus packages

10. BRICS: common currency issue

11. Financial Inclusion

putting in place appropriate technology for providing access to banking facilities in far flung rural areas. In order to reach remote villages, the bank has appointed 310 business correspondents and opened 28,610 customer service points. Besides this, 7,709 business facilitators have also been appointed to provide basic banking to the unbanked villages, the statement said. Since April 2010, SBI has opened 357 branches, out of which 207 were in rural and semi-urban areas. This takes the total share of branches located in rural and semi-urban areas to nearly 67 per cent.

7-Feb-2011 FE

SBI aims for Rs 4.75 lakh cr rural business by March : State Bank of India has set a target to achieve rural business worth Rs 4.75 lakh crore by end-March 2011, a top official of the bank said on Sunday. 'We are targeting rural advances of Rs 1.75 lakh crore by the end of March, 2011, 'SBI deputy managing director (rural business) R Venakatachalam said



17 Circle Specific

Patna Circle data

1.Date of establishment: Patna Circle was carved out of Kolkata Circle w.e.f. 1st July 1972

2. No. of States covered: 2 ( Bihar & Jharkhand)

3.No. of Networks-2

4.No. of Admin Office-5

5.No. of Regions- 23

6. No. of Branches-1135* (As on 31.03.2011)

Modules/

States/Networks

Metro Urban Semi-

Urban

Rural Total

Patna 60 20 82 74 236

Ranchi 80 64 125 269

Muzaffarpur --- 41 93 110 244

Bhagalpur --- 13 56 169 238

Purnea --- 15 51 82 148

CIRCLE 60 169 346 560 1135

Network-I 60 76 226 266 628

Network-II --- 93 120 294 507

CIRCLE 60 169 346 560 1135

Bihar 60 89 246 292 687

Jharkhand --- 80 100 268 448

CIRCLE 60 169 346 560 1135

* inclusive of 6 Branches under direct control of GMs.

Direct Branches:

Network-I :-


Sl. Name of the Branch

1 Patna Branch

2 Patna Sectt. Branch

3 SPB Patna Branch

4 Bailey Road Branch

NETWORK-II

Sl. Name of the Branch

1 Jamshedpur

2 Dhanbad

7.BPR OUTFITS :-

Network -I

Sl. Name of the CPC

1 RACPC Patna

2 SMECC Patna

3 CPPC Patna

4 CCPC Patna

5 RASECC Muzaffarpur

6 CAC Muzaffarpur

7 RASECC –cum SARC Purnea

8 DACPatna

Network -II

Sl. Name of the CPC

1 RACPC Ranchi


2 SMECC Ranchi

3 CAC Ranchi

4 RACPC Jamshedpur

5 SMECC Jamshedpur

6 CAC Jamshedpur

7 CAC Dhanbad

8 CCPC Ranchi

9 CCPC Jamshedpur

10 CAC B S City

11 RASECC –cum SARC Bokaro

12 RASECC –cum SARC Dhanbad

13 RASECC –cum SARC Bhagalpur

14 CAC Bhagalpur

8. Rural CPC :-

Network -I

Sl. Name of the RCPC

1 RCPC Aurangabad

2 RCPC banka

3 RCPC Begusarai

4 RCPC Bhagalpur

5 RCPC Arrah

6 RCPC Araria

7 RCPC Darbhanga

8 RCPC Motihari


9 RCPC Gaya

10 RCPC Gopalganj

11 RCPC Katihar

12 RCPC Madhubani

13 RCPC Muzaffarpur

14 RCPC Biharsarif

15 RCPC Patna

16 RCPC Fatwah

17 RCPC Purnea

18 RCPC Sasaram

19 RCPC Saharsa

20 RCPC Samastipur

21 RCPC Chapra

22 RCPC Sitamarhi

23 RCPC Siwan

24 RCPC Hajipur

25 RCPC Bettiah

26 RCPC Bhabua

27 RCPC Madhepura

Rural CPC :-

Network -II

Sl. Name of the RCPC

1 RCPC Deoghar

2 RCPC Dhanbad


3 RCPC Dumka

4 RCPC Chaibasa

5 RCPC Giridih

6 RCPC Godda

7 RCPC Hazaribagh

8 RCPC Koderma

9 RCPC Pakur

10 RCPC Daltonganj

11 RCPC Ranchi

12 RCPC Ramgarh

13 RCPC Garhwa

14 RCPC Sahibganj

9.Learning Centres: (4) Patna, Ranchi, Deoghar, Purnea

10.RRBs: (2) Samastipur, Vananchal

11. ADBs: (50) Bihar-46, Jharkhand-4

Network I- 42

Network II-08

12. No. of ATMs: 1105 (as on 31st March, 2011)

ECONOMY OF BIHAR

Agrarian economy.

Fertile land in the Gangetic basin is a blessing but recurrence of flood in North Bihar and droughts in parts of Central/South Bihar is a curse.

Poor Infrastructure facilities but growing (Power & Road). (a) Availability of metalled roads per 10 lakh of population-Bihar-43.89 kms; National Average-

151.27kms, (b) Availability of metalled roads per 100 square kms. Bihar-21.77kms; National Average-

38.83kms.

Absence of any big Industrial/ Business group in the State.

Low Literacy Rate & Low Per Capita Income.

42.6% of the population lives below the poverty line.


Only 34% of the 'working age group' population is employed, i.e. 66% are unemployed.

Potential for Food Processing industries, other Agro based industries & Personal Loan Products.

ASCB deposits (June'10)-Rs 101372 Cr

ASCB advances (June'10)-Rs 28822 Cr

Market Share of SBI in Deposits- Bihar(June'10)-30.71%

Market Share of SBI in Advances-Bihar(June'10)-29.24

C:D Ratio-SBI in Bihar(Dec'10)-27.84 %

72.19% of deposits in Bihar of SBI-PER deposits

52.23% of advances in Bihar of SBI-PER advances ECONOMY OF JHARKHAND

Mountainous Region & Rich Mineral Resources such as Coal, Iron, Mica, Bauxite,Uranium etc.

Presence of big Private Industrial Houses viz TATA & Public Sector Undertakings ( Bokaro Steel, HEC Ltd, Coal India Subsidiaries) etc.

Dhanbad is known as Diamond Capital of India and Bokaro as Steel Capital.

The state has surplus economy. It offers opportunities for raising Institutional deposits.

There are four good prospering centres i.e. Ranchi, Jamshedpur, Bokaro & Dhanbad. There is good scope for Retail loans.

Steel & Coal related Industries along with Auto Ancillaries are the major areas for Commercial Loans.

ASCB deposits (June'10)-Rs 64419 Cr

ASCB advances (June'10)-Rs 21443 Cr

Market Share of SBI in Deposits- Jharkhand(June'10)- 40.46 %

Market Share of SBI in Advances-Jharkhand(June'10)-34.27 %

C/D Ratio-SBI in Jharkhand(Dec'10)- 31.23 %

65.74% of deposits in Jharkhand of SBI-PER deposts

51.10% of advances in Jharkhand of SBI-PER advances

35.35% of advances in Jharkhand of SBI- C&I advances

DEPOSITS Level Growth % Growth

Rank among

Circles in terms of %

growth Budget % Bud achieved

MAR.'11 2010-11 2010-11

C & I 17883.80 1302.49 7.86 8th 4169.00 31.24

SIB 1155.04 112.93 10.84 5th 281.00 40.19

AGL 3094.08 1269.37 69.57 3rd 450.00 282.08

PER* 43396.08 7026.84 19.32 6th 11072.00 63.46

SEG. TOTAL** 65529.00 9711.63 17.40 6th 15972.00 60.80

SDBC 197.37 -202.40 -50.63 NB NB

AGG. TOTAL 65726.37 9509.23 16.92 15972.00 59.54


ADVANCES Level Growth % Growth

Rank among

Circles in terms of %

growth Budget % Bud achieved

MAR.'11 2010-11 2010-11

C & I 3915.76 517.89 15.24 8th 595.00 87.04

SSI 984.52 65.19 7.09 8th 275.00 23.71

SBF 1886.88 279.95 17.42 3rd 480.00 58.32

AGL 2771.58 449.33 19.35 3rd 600.00 74.89

PER 9766.45 1669.51 20.62 6th 2100.00 79.50

SEG. TOTAL 19325.19 2981.87 18.25 8th 4050.00 73.63

MISC. 19.31 -29.47 -60.41 NB NB

AGG. TOTAL 19344.50 2952.40 18.01 4050.00 72.90

OTHER PARAMETERS

% Change

MAR.'11 2010-11

Net Result 2175.07 40.84

Avg Bus/Emp 5.42 24.60

Net Profit/Emp (in lac) 15.48 51.91

GRR (%) 2.86 22.22

Expense Ratio (%) 34.40 -7.97

Avg Yield on Adv (%) 9.58 0.84

Avg Cost of Dep (%) 4.98 -3.68

Other Income Ratiio (%) 24.23 4.53

Transaction Cost 1.34 5.51

CASA 63.11% 110 bps

NIM

18 General Tips

General tips & Misc. Issues, General Questions

& answers.

Generally, for promotions at Scale I, II and III levels, specific-operational level, one liner kind of questions can be expected. But at higher levels of promotions conceptual, opinion or viewpoint soliciting questions can be expected. Adding flavor of bank’s Vision, Mission, Values, Training philosophy & HRD philosophy will add value to you answers. Interview is nothing but selecting most suitable candidate among suitable aspirants. It is not about knowledge testing only; it is about selection of “Banks Brand Ambassadors”. Minimum Qualification is- “Well Dressed, Well Behaved & Well Mannered” Honesty is the best policy. Be truthful. Interviews are generally meant to be freewheeling. It can be as informal as a train-travel conversation. Share your dreams or vision. Connect your dreams with Banks future. Let your answers have a spin, which come closer to your dream. Your dreams may not be practicable in the short run.


But, there is nothing wrong in spelling them out because after all Interview is a process where Bank selects Future Leaders. You must possess the quality of a Dynamic Future Leader. Read some articles, which are futuristic and have a vision for Banking Industry, besides speaking of challenges. Make as many lists, points and acronyms for easy recapitulation. Please be aware of similarities or differences in closely related concepts like: Unconditional cancellability clause and calling up of advances. Factoring & Forfeiting Stakeholder & Shareholder Equity Shares & Preference Shares Public Limited Company, Private Limited Company, Limited liability Company etc. Floating Charge & Fixed Charge Loans & Advances Guarantee & Indemnity Leasing – Hiring, Deferred Payment Guarantee & Term Loan Monetary Policy & Fiscal Policy Guarantee & Letter of Credit, Standby letter of credit. Siphoning of funds & Diversion of funds Funds Flow Statement & Cash Flow Statement Capital Account Convertibility & Current Account Convertibility Revenue Attachment Order & Garnishee Order Lien , Pledge & Hypothecation Certificate of Deposit & Commercial Paper Factoring & Financing Receivables Book Debt Financing & Receivables Financing NWC , Margin & Surplus. Associate, Subsidiary & Sister Concern. Syndication of Loan, Consortium Lending & Multiple Banking Outsourcing, off shoring & in sourcing Marketing, Selling, Cross Selling, up selling, Mis-selling, Down-selling? Economic Value Quantity & Economic Order Quantity Prima-facie Acceptability, Technical Feasibility, Economic Viability, Financial Feasibility, Commercial Viability. Break Even & Sensitivity Analysis. Margin of Safety & Asset coverage ratio? Customer Service, Customer Satisfaction, Customer Delight & Customer Ecstasy. Customer Lifetime Value, Customer Wallet Size, Customer Wallet Share. Sub-prime Crisis & Global Meltdown / Recession. BPLR / PLR & Base Rate. Economic Value Added (EVA) & Market Value Added (MVA). CAR or CRAR Duty & Positive Contribution CAGR & Growth rate. LET THIS ALWAYS BE AT YOUR FINGERTIPS


- Subjects you studied in college.

- Current topics and events: like, BASEL III, IFRS, FSDC, UID Project, Central Registry, Banking Law amendment, Women reservation, Anti-corruption law and its impact, illegal assets, growing inflation etc.

- Highlights of Financial result: SBI vis-à-vis other SCBs.

- Banking (International & National) related topics: Basel II & compliance instructions/position, IFRS & its effect, Khandelwal committee report etc.

- Favourite books, movies, and role models, Hobby: reasons also.

- Who’s Who in Banking System, our Bank, Your Circle.

Our Bank: Top Executives of SBI.

Shri Pratip Chaudhuri - Chairman Shri R Sridharan -MD & Group Chief Executive for Associates and Subsidiaries Shri Hemant Contractor – MD (IB) Shri A Krishna Kumar – MD (NB) Shri Diwakar Gupta – MD (CFO)

Corporate Banking responsibility will be divided between two DMDs.

Santosh Nair – DMD (Large Corporates)

Shyamal Acharya – DMD (Mid Corp)

- What’s what? CRR, SLR, REPO, Reverse Repo, Bank’s profits, Banks Growth plan, Capital Adequacy Ratio, NIM, Profitability, Mass Recruitment, Banks future prospects and preparedness for achieving Goals etc.

- Banks new Mission, vision & values. HRD philosophy & Training philosophy.

- Any interview date related significance (For example, if 1st July is the date of the interview, the significance of that day, if in 1st week of August: 1st August-KYC compliance & Fraud prevention day ).


- SBI Citizen, Parivartan, Udaan: effects of the programmes.

- SME Gyanshala, Krishi-Gyan , NRI Nipun etc.

- Merger & Acquisition and amalgamation.

- Banks new initiatives, such as Wealth Management, Custodial Services, General Insurance, financial Planning etc.

- New Products ( SME,Agri. & Per. Segment), Teaser Loans.

- Awards & Recognition ( SBI).

- Campaigns : like Project Ganga, New product: Grih Santosh etc.

- Effect of Restructuring / Rephasement , OTS, Loan Waiver etc.

- Right to recompense?

- Financial Inclusion, Financial literacy, use of technology for financial inclusion.

- Latest Awards, Appointments / Recruitments, Persons in news.

- NINJA concept, TQM , KAIZEN etc.

- Phishing, SPAM, cyber crime , WIKI leaks etc

- Why our new products specially technology products like SBI FREEDOM, Internet Banking is not picking up as at desired level? Your practical strategy?

Misc. Issues: i. The what, how and why of ‘Cloud Computing’

In a very nascent stage of development around the world, it is a general term used to

denote a set of technologies and networks that enable ‘internet-based computing’

where shared resources software and information are provided to computers and other

devices on demand through the internet. Let’s take an example of Google Docs whereat


one does not need to have a word processing application installed in one’s computer in

order to view or modify text or spreadsheet documents, making it a very good example

of cloud computing. In other words, it may be explained as the use of the internet to

perform tasks that one would do on his computer. In this parlance, a “cloud’ means a

place to store data, images etc. that can be retrieved from any device anywhere around

the world. Servers can e hired for the purpose of storing, accessing and

updating/modifying large databases. It can facilitate removal of unnecessary operational

and technical overheads of managing IT; ensure faster deployments and the reach of

citizen services in all states irrespective of their present e-Governance readiness. A

‘public cloud’ is offered as a service via web applications/ web services, usually over an

internet connection. ’Private or internal cloud’ are deployed inside the firewall and

managed by the user organization.

Advantages of cloud computing: Always available, highly mobile and available across

platforms, reduced upfront cost of deployment, unlimited storage pace, increased

computing power with rapid scalability as and when required, easier workgroup

collaboration in realtime, reduced risks of data loss, fewer maintenance issues as there

is no need to install or upgrade software & hardware, improved compatibility between

operating systems.

Impediments to making cloud computing popular: Access requires always on and high-

speed internet connectivity, ultra-advanced technology, as yet unresolved security &

privacy issues, lack of industry standards and inter-operability among applications,

limited features, users are subject to many terms & conditions.

ii. What is the UIDAI Project and how it could benefit the banking industry?

The Unique Identification (UID) project headed by Shri Nandan Nilekani, has been

renamed ‘AADHAAR’, that aims to give every resident of the country a unique 12-digit

identification number. Shri Nilekani is the Chairman of the Unique Identification

Authority of India (UIDAI). The UIDAI has been allocated Rs 1900 crore for the financial

year ending 31.3.2011. The UIDAI will also be collecting the following data fields and

biometrics for issuing AADHAAR, the unique number:


b. Name c. Date of birth d. Gender e. Father’s/ Husband’s/ Guardian’s name and AADHAAR number f. Mother’s/ Wife’s / Guardian’s name and AADHAAR number g. Introducer’s name and AADHAAR number (in case of lack of documents) h. Address i. All ten fingerprints, photographs and both iris scans

The AADHAAR project is estimated to offer IT companies a Rs 15,000-20,000 crore

opportunity, as it sets to build an ecosystem around the project, comprising biometrics,

databases, smartcards, storage and system integration.

Apart from the obvious function of being an identity proof for Indian residents,

AADHAAR will provide the identity infrastructure for ensuring financial inclusion across

the country- banks can link the unique number to a bank account for every resident and

use the online identity authentication to allow residents to access the account from

anywhere in the country. A vast majority of villages, as yet do not have the facility of

ATMs. “Making payments possible to the poor at their doorstep is an important part of

financial inclusion” says Mr. Nilekani. It would lay the foundation for inclusive growth as

banking could be taken to the people. The online authentication for any person can be

done in just a few seconds for a transaction. The ‘Business Correspondent’ (BC) would

act as a mobile ATM and a person can go to any BC in the country to withdraw/deposit

money through his account. The BC only would have to verify the authenticity of the

AADHAAR number through the phone and provide basic banking services to any

individual. The backend operation of this transaction can be conducted on the existing

platforms of ATM, internet or mobile banking. The UIDAI would come out with

standards for banks on how they could make their systems ready. The AADHAAR

number will also allow individuals to confirm through AADHHAR-linked biometric

verification, if the services that were aimed for them actually reached them.

UID-ENABLED BANK ACCOUNT: The Unique Identification Authority of India and the RBI are in talks to explore linking the unique identity number with bank accounts to enable cashless transactions at outlets like 'kirana' stores. The Authority has proposed a UID-enabled Bank Account (UEBA) which will give customers access to their account through Business Correspondent (BC) operating a handheld micro ATM device. Transactions on the UID-enabled bank account function essentially as a prepaid system, similar to that used by mobile operators.

iii) The RBI Governor Dr. Duvvuri Subbarao at the Zurich Conference


A high-level conference on ‘The International Monetary System’ was jointly organized

by the Swiss National Bank and the IMF in Zurich on 11.5.2010. The RBI Governor, Dr. D.

Subbarao represented India and stated that we will continue to move towards

liberalizing the capital account, but will have a relook into this in the light of the global

economic crisis. India’s policy on equity flows has been quite liberal and stable too, and

in sharp contrast to other emerging market economies which liberalized and then

reversed the liberalisation when flows became volatile. India’s position is that capital

account convertibility is not a standalone objective but a means for higher and stable

growth. We believe our economy should traverse towards capital convertibility along a

gradual path. In spite of not having a fully open capital account, India has experienced

large volatility in capital flows. The exchange rate of the rupee vis-a vis the US dollar

appreciated when there were large capital inflows; and it depreciated whe capital

inflows thinned out. The two-way movement is a clear demarcation of India’s flexible

exchange rate policy. The RBI’s policy has been to intervene in the market to manage

excess volatility and disruptions to the macro-economic situation. Although India does

not have a deliberate strategy of building up reserves for self insurance, our reserves got

built up as a result of our relatively flexible exchange rate policy,. The reserves so built

up have been used to contain volatility in the event of capital flow reversals. Our

reserves comprise essentially borrowed resources, and we are therefore more

vulnerable to sudden stops and reversals as compared with countries with current

account surpluses

iv) What is the proposed ABCD (automatic tax collection through bank

credit deduction) system?

Under the proposed ABCD system, each time an amount in an account in a bank,

automatically, say Rs 2 per Rs 1000 (0.2 percent) is debited to the account and

transferred to the Exchequer. ABCD will apply to; a) cash deposit in favour of the

account holder, b) cheques deposited in favour of the account holder, c)direct transfer

from one account-holder to another account-holder in the same branch of the bank;

and d) transfer from one bank to another in favour of the account holder. But it will

exclude: a) opening credit balances taken from time to time, e.g., monthly/ quarterly

etc, b) credits arising out of inter-branch transfer of the same bank of the same account

holder, c) time deposit credits till they mature and get credited in the C/A or SB account

oh the account holder, d) inter- branch transfers of the same bank (e.g., SBI Delhi

transferring funds to SBI Mumbai to their account, e) day-to-day ‘call money’ market


under RBI control, f) foreign exchange credits that are already a part of ABCD but being

converted to INR and credited to the same account-holder and, g) total credit less than

Rs 1,00,000 in a year. As per the RBI data, the total volume of bank transactions

consisting of cheque clearances, large value gross settlement systems, other electronic

settlement systems, export-import and forex inward remittances per year came to

nearly Rs 161,924,592 crore. On this account alone, the ABCD at 0.2% will work out to

RS 323,849 crore. This data does not include the daily cash deposits in each branch of a

bank and the fund transfers within the branch from one account holder to another.

The ABCD system, when fully administered would lead to higher tax collection to the

exchequer and also, will be simple to administer, as it will end the current practice of

returns to be filed by the assesses, TDS, computation of depreciation, investment

allowance, deductions, exemptions, appeals and litigation, ambiguities and so on . ABCD

will operate through the banking system using computer technology. It will also save

assesses and the CBDT costs arising out of filing and monitoring taxes.

v) Clean Development Mechanism (CDM) projects with India in perspective

India is a big market for CDM projects and accounts for about a fourth of the over 2144

CDM projects registered with the UN Framework Convention on Climate Change

(UNFCCC). The CERs (certified emission reduction certificates) obtained from the CDM

projects are traded in the carbon market. India is the second largest seller of CERs after

China and accounts for about a fifth of the over 41 crore CERs issued by the UNFCCC.

Carbon credis can be earned from four category of projects including renewable energy,

energy efficiency, waste energy and afforestation. The current carbon trading

mechanism is backed by the Kyoto Protocol, which comes to an end in 2012.

vi) Various aspects of Indian Depository Receipts (IDRs)

Each IDR is essentially a receipt, representing a share, or part of a share, in a foreign

company. Quite simply, the company floating the issue appoints an Indian Depository,

which in turn issues the receipts to investors. The actual shares represented by the receipts

are held by an overseas custodian. It is, however, upto the issuing company to decide the


number of IDRs that make up a share in the company. IDRs are denominated in rupees, thus

allowing trading similar to trades in securities. While they are usually issued in the demat

form, a separate application can be made if one wishes to hold them in physical form. In

such a case the depository will issue an IDR certificate. IDR prices are linked to the prices of

the stock on foreign exchanges, and thus changes in exchange rates will impact IDR prices.

IDRs can be converted into shares but a separate application must be made to the RBI. IDRs

are not exempt from long term capital gains rates. Dividends on IDRs received are taken as

taxable income in anyone’s hands. When the company is taken over or merged, anyone’s

rights will be similar to those of a regular shareholder.

VII) CAFRAL:

CENTRE FOR ADVANCED FINANCIAL RESEARCH & LEARNING

The Centre for Advanced Financial Research and Learning (CAFRAL) has been set up by the Reserve Bank of India as a Society and a Trust to develop into a global resource for research and capacity building in banking and finance for central bankers, regulators and senior management of banks, government and industry. Smt. Usha Thorat, former Deputy Governor, RBI is director of CAFRAL.

BACKGROUND

CAFRAL has been set up by RBI as per the recommendations of the Committee on Repositioning Bankers’ Training College (BTC). The Report of the Committee envisioned that CAFRAL should serve as a think tank of global standing on banking and finance. Given India’s evolving position in various global fora, it is considered timely to establish a world class centre in India to undertake research in banking and finance that will be of value to central banks, policy makers, regulators and practitioners.

FUNCTIONS: CAFRAL will perform the following functions:

Undertake research that will be useful to central banks and regulators and the financial sector.

Conduct learning programmes for central banks, regulators, boards and senior management in the financial system, industry and government on matters related to banking and finance.

Provide a platform for academics, researchers and practitioners to explore policy and regulatory issues in banking and finance.

Disseminate the results of the research and learning activities.

RESEARCH:

Research undertaken by CAFRAL will be largely demand driven and will also aim at bringing together cross country experiences. Initially, CAFRAL will give priority to research in financial


sector regulation and supervision, financial markets and financial inclusion. Over time, other areas for research will be accounting and auditing standards, reserves management, debt management, payments and settlement systems, and consumer protection.

CAFRAL will invite researchers interested in either working with CAFRAL for short periods or others who may like to join on a longer term basis. CAFRAL will also welcome researchers who could come on deputation/sabbatical or as adjunct / visiting faculty. Research contribution from current locations would also be possible.

LEARNING ACTIVITIES

CAFRAL will conduct learning activities in the form of conferences, seminars and e-learning programmes for central bankers, regulators, supervisors, boards and senior management of banks and financial institutions, government and industry to enable them to take more informed and effective decisions.

Learning activities would use as external resource persons, experts in the field from central banks, regulators, financial sector, industry and consultants and practitioners. CAFRAL will also have a limited number of core faculty with proven expertise, experience and flair for conducting learning activities.

COLLABORATIONS

The Bank for International Settlements at Basel, Switzerland has agreed to collaborate with CAFRAL in research, in sponsoring international conferences and in providing experts.

CAFRAL is also exploring possibilities of collaborating with universities, research institutions and financial sector in India and abroad for intellectual and technical support as also for providing or facilitating provision of resource persons.

GOVERNING COUNCIL

CAFRAL has a Governing Council chaired by the Governor, RBI. The current members of the Governing Council are Dr. K.C. Chakrabarty, Deputy Governor, RBI, Dr. Subir Gokarn, Deputy Governor, RBI, Dr R. H. Patil, Shri Y. H. Malegam, Dr. Ashok Ganguly, Shri T.V. Mohandas Pai and Dr J.J. Irani.

FUNDING

CAFRAL is funded by the Reserve Bank of India. The arrangement will be reviewed after a period of five years.

LOCATION


Currently, CAFRAL is operating from the Reserve Bank’s Mumbai Regional Office but will operate out of the Reserve Bank’s premises at the Bandra-Kurla Complex till infrastructure for CAFRAL is ready at the erstwhile BTC complex. The property will be developed into a world class facility providing a conducive environment for research and learning activities.

The CAFRAL website can be accessed at www.cafral.org.in

VIII) AMA for ORM:

RBI had advised banks that they can apply for migrating to Advanced Measurement Approach (AMA) for calculation of capital charge for Operational Risk from April 1, 2012 onwards. The Basel - II Framework presents three methods for calculating operational risk capital charge in a continuum of increasing sophistication and risk sensitivity:

The Basic Indicator Approach (BIA);

The Standardised Approach (TSA) / Alternative Standardised Approach ;

Advanced Measurement Approaches (AMA).

Banks intending to migrate to AMA for computing capital charge for operational risk are advised to assess their preparedness with reference to these guidelines. As and when they are ready for introduction of AMA, they may first give RBI a notice of intention. RBI will first make a preliminary assessment of the bank’s risk management system and its modeling process. If the result of this preliminary assessment is satisfactory, RBI will allow the bank to make a formal application for migrating to AMA. RBI will then perform a detailed analysis of the bank's risk management system and proposed model prior to according approval.

It may be clarified that banks have the discretion to adopt AMA, while continuing with simpler approaches for computation of capital for credit and market risks. Further, a bank following BIA can switch over to the AMA directly. However, as banks are aware, all the qualitative requirements relating to operational risk management applicable to TSA form part of the qualitative requirements for AMA. Therefore, a bank may also consider moving to TSA first so that the work done in the implementation of TSA could be used to meet part of the requirements for AMA as and when the bank considers switching over to that approach.

What is IFRS?

IFRS are "principles based" set of standards in that they establish broad rules as

well as dictating specific treatments in financial reporting.


These are required or permitted for use in over ninety countries for financial

reporting.

The Institute of Chartered Accountants of India (ICAI) has announced that IFRS will be mandatory in India for financial statements for the periods beginning on or after 1 April 2011 . Govt. has allowed two more years to banks and NBFCs to comply with International Financial Reporting Standards (IFRS). Now it will be effective from April 1, 2013. All listed companies with net worth above Rs 500 crore, will have to be IFRS compliant by April1, 2011. For insurance companies, the convergence deadline will be April1, 2012.

This will be done by revising existing accounting standards to make them

compatible with IFRS. RBI has also stated that financial statements of Banks need to

be IFRS-compliant for periods beginning on or after 1 April 2011. (now Govt. has

allowed two more years to banks and NBFCs to comply with International Financial

Reporting Standards (IFRS). Now it will be effective from April 1, 2013. )

The MCA( Ministry of Corporate affairs) has confirmed that companies will be

required to comply with the converged accounting standard (AS) that are in the

process of being notified by the Institute of Chartered Accountants of India (ICAI),

and not ‘full' IFRS.

The differences between full IFRS and converged AS are not known at this point in

time as the Converged AS have not yet been notified. However, it is expected that

these may be in the area of presentation format, depreciation, actuarial valuation of

long-term employee benefits, etc.

Almost all developed capital markets of the world, require full IFRS. The converged

AS will not be acceptable in these markets, as they may not be fully compliant with

full IFRS. The adoption of full IFRS in India will make it easy for Indian entities to

access these markets.

Under IFRS, 29 International Accounting Standards (IAS) and 9 IFRS are currently in

issue.

In addition, 11 Standing Interpretations Committee (SIC) and 16 International

Financial Reporting Interpretations Committee (IFRIC) interpretations provide

guidance on interpretation issues arising from IAS and IFRS.

National Advisory Committee on Accounting Standards (NACAS) studying the

probable impact


US GAAP: US GAAP or simply GAAP – is Generally Accepted Accounting Principles (accounting

rules) used to prepare present and report financial statements for a wide variety of entities

including publicity traded and privately held companies, Nonprofit organizations and

Governments.

FAIR VALUE ACCOUNTING (FVA) –

Fair value is used as an estimate of the market value of an asset or liability for

which a market price cannot be determined.

Fair value of an asset is the amount at which the asset could be bought or sold in a

current transaction between willing parties other than in liquidation.

Fair value of a liability is the amount at which that liability could be incurred or

settled in a current transaction between willing parties other than in liquidation.

Available quoted market price in an active market is the best evidence of fair

value. If quoted market price is not available, best information available is required

to be used in estimation of fair value.

FSDC?

To strengthened & institutionalize the mechanism for maintaining financial

stability.

Will monitor Macro prudential supervision of the economy including the

functioning of large financial conglomerates.

Address inter-regulatory co-ordination issues (IRDA-SEBI issue on ULIP)

What is FLCCC?

Financial Literacy & Credit Counseling Centre

Each Lead Bank should open a Financial Literacy and Credit Counselling centre in

each district by following the recent guidelines issued by the Reserve Bank.

Securitisation?

The process of converting debt into tradable securities is called securitization.

Deregulation of Banking activities.

Bank’s have freedom to act subject to broad guidelines prescribed by RBI.

As per Narsimham Committee-i recommendations(1991).

RBI obtains compliance reports, off-site surveillance, on-site inspection etc.

Every bank has to appoint a GM level official as Compliance officer who is

responsible for compliance of various laws & regulations (in SBI Mr Shyamal Sinha).

o Globalisation?

a. It refers to the act or state of becoming World-Wide in scope.

b. It means geographical limitations do not restrict financial institutions

transactions or activities.


c.Modern developments in IT have encouraged Globalisation.

2.Latest RBI committee on Customer Service?

a. “Mr M Damodaran(Ex Chairman,SEBI)” Committee.

Review the existing system of attending to customer service in banks - approach, attitude and fair treatment to customers from retail, small and pensioners segment.

Evaluate the existing system of grievance redressal mechanism prevalent in

banks, its structure and efficacy and recommend measures for expeditious resolution of complaints. The committee may also lay down a suitable time frame for disposal of complaints including last escalation point within that time frame.

Examine the functioning of Banking Ombudsman Scheme - its structure, legal framework and recommend steps to make it more effective and responsive.

Examine the possible methods of leveraging technology for better customer service with proper safeguards including legal aspects in the light of increasing use of Internet and IT for bank products and services and recommend measures to enhance consumer protection.

Review the role of the Board of Directors of banks and the role of Regulators in customer service matter.

b. The committee has to identify innovative measures to forcefully change the attitude of human resources who provide the service. Introduction of incentives and disincentives in promotion, transfer, emoluments and bonuses linked to customer service will go a long way in improving the mindset of such people.

c. Customer Service Ratio: The assessment of customer service has to be done

independent of RBI annual inspection, but should reflect in RBI's overall rating and should be made transparent for all customers of all banks to see. Perhaps a ratio akin to capital adequacy ratio reflective of customer service should be thought of to make banks and its human resources behave responsibly.

o SBI amendment Act: salient features?

o To provide greater greater flexibility in the management of the Bank.

o Govt. Holding at 51%(at par with others),presently-59.43%

o Authorised Capital to Rs. 5,000 Crore up from Rs.1,000 at present.

o Earlier in 1993 to access capital market. In Dec. 2006(but lapsed because

Parliament dissolved).

o Provision to issue Preference share & Bonus Share (presently no such provision).

o Empower Govt. to appoint 4 MDs & abolition of the post of Vice Chairman.


o Shareholder with at least Rs.5,000 worth of Shares to contest the election for

directorship in SBI.

o What & Why STU?

o In alignment to our Values (SBI Value statement)- We will be knowledge driven &

We will Learn & will share our learning.

o Will bring entire training system under unified command-Headed by CGM(L&D).

o Will drive & own training system of SBI.

o Objective: Skill Up gradation & making SBI a Learning Organisation capable of

handling change & growth for a Bank aspiring to be amongst the top 20 in the

World.

o SBI: Largest training network- 50(04 ATIs+46 SBLCs).

o At present our focus is on our employees only. At present SBI is not seeing

training as an independent revenue source. However we have trained persons

from outside Bank also.

o Focus:

Is on how to improve course content & improvement in the quality of

faculty at our training establishments.

Leadership development: tie-up with ISB for content Dev.: CMs to Dy

GMs – they are good but the idea is to make them better.

Tie-up with DUKE university (US)for giving leadership training to GMs &

CGMs.

Upgrading the skills of the employees in view of the major expansion of

workforce & business and competitive business environment.

Consolidate entire training process.

o Setting up of an elaborate “e-Learning” platform:

Presently only 137 (approx) courses & only 2,000 employees can log the

system concurrently.

Customized courses for each level employee who can take online tests as

well.

o Target: to train at least 1.20 Lac (Approx 60%-2,00,299 employees) a year. Make

every employee attend a 2 week training programme(at least) once in 18 to 24

months. To keep the employees abreast of the changing business environment

and competition.

o Trainee-Trainer ratio 500:1 ( approx 400 trainers)

o Base Rate?

o New system of determining Credit pricing in a more transparent, simple &

understandable manner.

o Non-discriminatory in nature.


o Calculation: Base Rate

Cost of Deposit (SBI – 6 months Deposit rate) +

Adjustment for the negative carry in respect of CRR & SLR ( No intt. On

CRR & lesser intt. On SLR securities- Govt. treasury bill rate-364 days) +

Unallocatable overhead cost of the Bank (aggregate employee

compensation relating to administrative functions in admin. Offices+

directors & auditors fees+ legal & premises expenses+ depreciation+ cost

of printing of Stat.+ expenses on communication & advertisements+ IT

spending etc) +

The average return on Net worth ( portion of profit of the Bank which

needs to be recovered from advances portfolio as a whole. Commonly

NIM).

BASE RATE CALCULATION

ILLUSTRATION BY THE WORKING GROUP

ESTIMATES OF BASE RATE UNDER THE PROPOSED REGIME

COMPONENTS (Per cent)

Base Rate (a – b + c + d + e) 8.55

a) One year card deposit rate 6.50

b) CASA adjustment 1.31

c) Negative carry on CRR and SLR 0.96

d) Unallocatable Overheads Cost adjustment 0.99

e) Average Return on Net Worth 1.41

It is to be noted that the rate arrived as an illustration is higher than the teaser rate of 8%

o Effective ROI is Base Rate + Customer Specific Charges+ Product specific

operating Cost + credit risk premium + term premium.

o Important step towards deregulation of intt. Rate (ceiling of intt. On loan upto

Rs.2 Lac since withdrawn)

o Deregulated interest rates, along with other specific measures taken by the

central bank for financial inclusion, will draw borrowers away from the informal

to the formal financial sector and facilitate better credit penetration.

o Exceptions of BASE Rate?

o Base rate is effective from 1st July 2010 : loans will be at or above base rate in respect of all fresh/renewed advances. Banks can reduce the interest rate


chargeable to exporters in the sectors such as agriculture, handicrafts, carpets, handlooms, and small and medium enterprises, by the amount of subvention available. If, as a consequence, the interest rate goes below the base rate, such lending will not be construed to be in violation of the guidelines. Loan against Bank Deposits

Loan to staff

DRI Advances

Export & Agl. Advances- where Intt. Subvention available

o Agl. Intt. Subvention- on short term loan up to Rs. 3 lac( +

1% for prompt repayment)

o Export – 2% intt subsidy

o Government of India, Ministry of New and Renewable Energy (MNRE) has formulated a scheme on financing of Off-Grid and Decentralised Solar (Photovoltaic and Thermal) applications as part of the Jawaharlal Nehru National Solar Mission (JNNSM). Under the scheme, banks may extend subsidised loans to entrepreneurs at interest rates not exceeding five per cent where refinance of two per cent from Government of India is available. RBI has advised that such lending at interest rates not exceeding five percent per annum where refinance of Government of India is available would not be considered to be a violation of Base Rate Guidelines.

Khandelwal Committee?

The committee headed by Dr Anil Khandelwal, former CMD of Bank of Baroda has submitted the following recommendations to Finance Minister regarding PSBs Appointment of 3rd ED for HRD in banks with business over Rs 3 lac crore

and 30,000 staff. Have HR audit in bank every two years Performance appraisal for Chief Managers and above Separate post of Chairman and Managing Director Mandatory rural service for officers to continue No change proposed to retirement age for bank staff 3 percent of net profit to be allocated for staff welfare; 25 percent of

Welfare should go to the retired Committee approach for sanctioning large credits 50 percent direct recruitment for officers cadre


Maharatna for SBI; introduce Maharatna, Navratna and Mini-ratna scheme for banks

Award ESOPs to 15% top performers. ESOP: EMPLOYEE STOCK OPTION PLAN: The term 'ESOP' or 'employee stock

option plan' is used for certain kinds of schemes that are used to remunerate, reward and retain employees. They take various forms - stock option schemes, share purchase schemes, stock appreciation schemes, sweet equity, etc. Their distinguishing feature is that the reward is directly linked with the appreciation of the company's share price.

Social Intelligence: Mr. Daniel Goleman defines social intelligence as:

1) Social awareness, which comprises of empathy, attunement, empathic accuracy, and

social cognition, and

2) Social facility, which includes synchrony, self-presentation, influence, and concern.

Most theories of social intelligence are narrowly defined to a cognitive context. Social

intelligence tests ask participants what they would do in specific situations - a process

that uses the brain's "high road" functions within our awareness.

Goleman's Emotional Intelligence focuses on skills and capabilities within the individual

and such deals with self-motivation, self-awareness, handling anxiety, and reading social

cues and so on. Unlike Emotional intelligence, Social intelligence focuses on intimate

connection between two human minds. Social Intelligence expands from the one-

person psychology within an individual to a two-person psychology that looks at the

connection shared between individuals.

Goleman's model of social intelligence seeks to include the brain's low-road, the neural

circuitry hidden from consciousness that functions at incredible speeds, because

awareness of what people are thinking or feeling does not equate to healthy

conversations. Social intelligence is beyond the intelligence quotient (I.Q.) and Emotional

intelligence. Drawing on hundreds of studies, Social Intelligence looks into altruism,

primal empathy, attachment, rapport, and compassion to name a few topics that are

emerging from this new field of study.

Most organizations today know that it is quality of the customer interface that decides

whether he would return to us or not. Similarly, harmony in the working atmosphere of

a Branch can be traced to the Social intelligence levels of the Branch management.

Goleman talks about how employees, distressed by the way their managements (with

low Social intelligence) behaved, developed stress related physical diseases such as high

blood pressure and so on. This not only affects the productivity but quality of customer

service from that particular branch also.

The concept of Social Intelligence needs no introduction but revival in the Indian


context. The benefits are there for both - the Individual and the Organization.

o EMOTIONAL ECONOMY: Daniel Goleman coins the term Emotional economy, a term

that describes the give-take process of emotions. It discusses how a smile makes you

happy, a worried looking face makes you unsure, and the biological process of how

emotions transmit through people like a virus.

o HR management in Banks- Fin Min view?

o Union Finance Minister described human resource management as the most "daunting" task facing banks in the coming years. The market is seeing growth, driven by new products and services both on the retail as well as the wholesale banking side. These require new skills in sales and marketing, credit and operations. The demographic shift resulting from changes in the age profile and household income will increase consumer demand and there will be a need for enhanced institutional capabilities and service levels. There is a need to fundamentally strengthen institutional skill levels, especially in sales and marketing, service operations, risk management and overall organisational performance ethics.

o MSME high level task Force-Details.

d. A High Level Task Force headed by Shri T.K.A. Nair was set up to consider various issues raised by MSMEs. The Task Force submitted its Report on January 30, 2010. It recommended several measures having a bearing on the functioning of MSMEs, viz., credit, marketing, labour, exit policy, infrastructure / technology / skill development and taxation. In particular, it recommended that:

All scheduled commercial banks should achieve a 20 per cent year-on-year growth in credit to micro and small enterprises to ensure enhanced credit flow;

Any shortfall in the achievement of sub-target of 60% for lending to micro enterprises of the total advances granted to the micro and small enterprises, would also be taken into account for the purpose of allocating amounts for contribution to rural infrastructure development fund or any other Fund with other financial institutions as specified by the Reserve Bank, with effect from April 1, 2010; and

All scheduled commercial banks should achieve a 15% annual growth in the number of micro enterprise accounts.

Banks are urged to keep in view the recommendations made by the Task Force and take effective steps to increase the flow of credit to the MSE sector, particularly to micro enterprises.

o 4R’s in Mobile Banking?

o Run Rate- Growth Rate.

o Risk- Trust, Faith & benefit.


o Reputation- Brand perception.

o Regulation-Enabling environment.

o Bank wise wage negotiations:

Positive :-

a. Improve effectiveness b. Improve capacity c. No delay in settlement d. At par with Pvt. Sector e. Will get Good talent f. Survival of the fittest g. Transparency h. Will lead to overall efficiency i. High morale of performers j. PSB employees will also get competitive pay k. Performers / talent needs reward

Negative:

a. Against natural justice b. Unequal pay for by and large same work c. Profits depend on so many factors: internal, external, Govt. Policies & Priorities. d. Against the social-commercial welfare structure of Indian Banking e. Write-offs should be added back while calculating notional profit. f. If profit goes down or if completely eroded, then? g. Except SBI recruitment in other Banks by BSRBs, no consideration of quality for

allotment of Banks h. Min. 51% Govt. holding- disparity, discrepancy and discretionary. i. Without complete deregulation, how Banks will operate freely & generate more profits

freely. j. If weak bank turns strong or vice-versa than? k. It will make weak banks weaker- lesser talented people. l. Sometimes talent has nothing to do with compensation also ( Total compensation

concept= transactional comp.+ Contribution Comp.+ Fulfilment Comp.) m. Profits may be eroded due to fault of one branch or person or one account- then? Can

we move for branch wise – person wise negotiation.

o 25% PUBLIC SHAREHOLDING MANDATORY: In a big bang move aimed at bringing in

more accountability and enhancing investor participation, the government has made it

mandatory for all listed companies, including public sector companies, to raise public

shareholding to 25%. The decision will result in mobilisation of nearly Rs.1,60,000 crore

from the market, out of which about 82% around Rs 1,28,000 crore is likely to be raised


by 29 listed government entities. For the government, which is looking for new sources

of revenue generation, this will be a good opportunity to garner funds and reduce fiscal

deficit.

o FATF?: Financial Action Task Force

o An inter-governmental body responsible for setting global standards for

AntiMoney-Laundering and combating financing of terrorism.

o 35 member Countries (India Obsrver).

o Quasi-fiscal liabilities: the public sector banks have to be recapitalised by the government because of the credit losses, the NPAs represent a source of quasi-fiscal liabilities. Finance Minister has expressed serious concerns over the rising levels of non-performing assets (NPAs) in banks and said this can lead to quasi-fiscal liabilities. From a macro-economic policy point of view, rigidities in lending rates that result from the large stock of NPAs dampen the effectiveness of monetary policy.

o BANK CHIEF SELECTION RULES: PMO’s objection results in candidates needing 18 months of residual service. Now, candidates with at least 18 months of residual service will qualify. The move came after the Prime Minister’s Office (PMO) turned down the finance ministry’s proposal to allow bankers with 15 months of service left to be appointed as bank chiefs.

o 'BIOPRINTER' TO CREATE HUMAN ORGANS: Scientists have developed a new machine that can weave human organs with fragments of tissues. The new method, based on 3D laser printing technology, could be used to create body parts. Instead of combining layers of plastic and metal, the 'bioprinter' puts living tissue together.

o NCD: DEFINITION:

a) NCD means a debt instrument issued by a corporate (including NBFCs) with original or initial maturity up to one year and issued by way of private placement.

b) “Corporate” means a company as defined in the Companies Act, 1956 (including NBFCs) and a corporation established by an act of any Legislature

ELIGIBILITY TO ISSUE NCDs: A corporate shall be eligible to issue NCDs if it fulfills the following

criteria, namely,

The corporate has a tangible net worth of not less than Rs. 4 crore, as per the latest audited balance sheet;

The corporate has been sanctioned working capital limit or term loan by bank/s or all-India financial institution/s; and

The borrowal account of the corporate is classified as a Standard Asset by the financing bank/s or institution/s.

NCDs shall not be issued for maturities of less than 90 days from the date of issue. NCDs may be issued in denominations with a min. of Rs.5 lac (face value) and in

multiples of Rs.1 lac.


ROLE: Role is a position, which a person occupies in an organization, defined by the

expectations of others (significant groups or individuals), and by himself. Role should be

properly defined to avoid ambiguity, overlapping, transgression and stress.

3G SPECTRUM: By 2G and 3G we mean second generation and third generation

spectrum. Spectrum refers to a range of radio frequencies used to

transmit voice, video and data. The bandwidth of a radio signal is the

difference between the upper and lower frequencies of the signal.

Telephony in its initial stage started as analog signal processing mechanism. Analog values are typically represented as a voltage, electric current, or electric charge around components in the electronic devices. An error or noise affecting such physical quantities will result in a corresponding error in the signals. To overcome this limitation, help of radio signal based communication was resorted to, which we today know as mobile communication network. First such attempt was made in Europe, way back in 1924. Its full fledged commercial use started by early seventies. This was called 1G – first generation technology.The bandwidth and location information available to 3G devices gives rise to applications not previously available to mobile phone users. Some of the applications are:

Mobile TV – a provider redirects a TV channel directly to the subscriber's phone where it can be watched.

Video on Demand – a provider sends a movie to the subscriber's phone. Video Conferencing – subscribers can see as well as talk to each other. Tele-Medicine – a medical provider monitors or provides advice to the potentially isolated

subscriber. Location-based Services – a provider sends localized weather or traffic conditions to the

phone, or the phone allows the subscriber to find nearby businesses or friends. MINIMUM ALTERNATE TAX (MAT): MAT was introduced in the direct tax system to

make sure that companies having large profits and declaring substantial dividends to

shareholders but who were not contributing to the Govt by way of corporate tax, by

taking advantage of the various incentives and exemptions provided in the Income-tax

Act, pay some minimum tax to the govt.

Several objections were raised to moving MAT on asset base and the govt was

convinced that it is better to put the MAT on book profits basis rather than on asset

base. Rationalization of gross assets tax levy re-affirms govt’s agenda for ushering in

reforms as the move would clearly rub off the anxieties for infrastructure, insurance

and financial services sector. Withdrawal of tax treaty override provisions (barring in

exceptional circumstances) can be hailed as well thought policy move, aligning to global

benchmark and the spirit of Vienna Convention.

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o What is Commercial paper?

It is an unsecured money market instrument, usually issued by top-rated corporates to meet their working capital requirements. The instrument was introduced in 1990 to Indian borrowers and initially such issues were confined only to corporates. Subsequently, primary dealers were also permitted to issue CP to enable them to meet their short-term funding requirements. CP can be issued for tenors ranging from a minimum of 15 days to a maximum up to one year. CPs can also be traded in the secondary market by investors.

o EET- EET, it is a tax system where an investment in a tax-saving plan is deductible from

income. So also is the interest earned? However, the maturity amount is taxable. This is

in contrast to the current EEE system where investment, interest and the maturity

amount is tax-free. A case in point is the Public Provident Fund (PPF).

o CDS (Credit Default Swap)-

A Credit Default Swap (CDS) is a contract in which a buyer pays a payment to a seller to

take on the credit risk of a third party.

In exchange, the buyer receives the right to a payoff from the seller if the third party

goes into default or on the occurrence of a specific credit event named in the contract

(such as bankruptcy or restructuring).

A credit default swap is an option/ insurance contract but called a swap more due to its

longer tenor and pricing methodology, which is akin to pricing a swap contract.

In short, it is a mutual contract between a protection buyer and protection seller. The

protection is against the credit default by a reference entity with respect to a reference

asset or assets. The buyer pays the premia, called spreads, denominated in basis points.

A Credit Default Swap (CDS) is a credit derivative contract between two counterparties,

whereby the "buyer" pays periodic payments to the "seller" in exchange for the right to

a payoff if there is a default or credit event in respect of a third party.

o ANBC : For the priority sector lending, ANBC denotes NBC plus investments made by

banks in non-SLR bonds held in HTM (held to maturity) category.

o STATE LEVEL INTER INSTITUTIONAL COMMITTEE :In order to deal with the problems of

co-ordination for rehabilitation of Sick micro and small units, State Level Inter-

Institutional Committees (SLIICs) have been set up in all the States. Quarterly meetings

of these Committees are convened by Regional Offices of RBI and presided over by the

Secretary, Industry of the concerned State Government. It closely monitors timely

sanction of working capital to units which have been provided term loans by SFCs,

implementation of special schemes such as Margin Money Scheme of State

Government, National Equity Fund Scheme of SIDBI, and reviews general problems

faced by industries and sickness in MSE sector based on the data furnished by banks.


o EMPOWERED COMMITTEE ON MSMES : Empowered Committees on MSMEs have been constituted under the Chairmanship of the Regional Directors, RBI, with the representatives of SLBC Convenor, senior level officers from two banks having predominant share in MSME financing in the state, representative of SIDBI Regional Office, the Director of Industries of the State Government, one or two senior level representatives from the MSME/SSI Associations in the state, and a senior level officer from SFC/SIDC as members. The committee will meet periodically and review the progress in MSME financing as also rehabilitation of sick micro, small and medium units.

o COMMON GUIDELINES FOR LENDING TO SMALL ENTERPRISES SECTOR

Disposal of Applications: All loan applications for MSE units upto a credit limit of Rs. 25000/- should be disposed of within 2 weeks and those upto Rs.5 lakh within 4 weeks provided, the loan applications are complete in all respects and accompanied by a " check list".

Collateral: The exemption limit for all MSME borrowal accounts for obtention of collateral security (both manufacturing or production and providing or rendering of services) is Rs 10 lakh. Banks may on the basis of good track record and financial position of the MSME units increase the limit of dispensation of collateral requirement for loans up to Rs.25 lakh (with the approval of the appropriate authority).

Composite Loan: A composite loan limit of Rs.1crore can be sanctioned by banks to enable the MSME entrepreneurs to avail of their working capital and term loan requirement through Single Window.

Specialised SME Branches: Public sector banks have been advised to open at least one Specialised branch in each district. Further, banks have been permitted to categorise their SME general banking branches having 60% or more of their advances to SME sector in order to encourage them to open more specialised SME branches

Delayed Payment: After the enactment of the Micro, Small and Medium Enterprises Development (MSMED), Act 2006, the existing provisions of the Interest on Delayed Payment Act, 1998 to Small Scale and Ancillary Industrial Undertakings, have been strengthened as under:

The buyer shall make payment on or before the date agreed upon

between him and the supplier in writing or before the appointed

day, i.e. within 30 days of acceptance of goods. In no case the

agreement between seller and buyer shall not exceed more than

45 days.

In case the buyer fails to make payment of the amount to the supplier, he shall be liable to pay compound interest with monthly rests to the supplier on the amount from the appointed day or, on the date agreed on, at three times of the Bank Rate notified by Reserve Bank.


In case of dispute with regard to any amount due, a reference shall be made to the Micro and Small Enterprises Facilitation Council, constituted by the respective State Government.

o Dr. Rangarajan to head panel on public expenditure: An 18-member high-level expert committee has been set up under the Chairmanship of Dr. C. Rangarajan, who heads the Prime Minister’s Economic Advisory Council, to suggest measures for efficient management of public expenditure. This committee will among other things define the scope of public sector Plan and suggest ways for the abolition of the classification of expenditure into Plan and Non-Plan. The whole idea would be to get a better idea of the impact of public expenditure. The committee would also look at new mechanisms that have evolved such as special purpose vehicles for NREGA, NRHM, etc. Dr. Rangarajan said.

o Career Path Planning: Career Path Planning is an important function of the HRD system.

Career paths help the employee understand and plan their career within the

organization and enhance their motivation levels. Career paths design and arrange an

organized system of growth and movement of the employee keeping the needs of both

the Organization and the employee. Vertical career paths as seen in the Banks allow an

employee to grow from the lowest level to the highest if he satisfies certain conditions.

Functional Career paths involve enhanced functions for the employee at the same level.

o JOB ENRICHMENT: Job Enrichment is a tool used for motivating the employee to

perform better by deliberately upgrading responsibilities, scope and challenges in his

job. This is different from Job enlargement which implies giving additional work to the

employee. Allowing a Cashier to manage the cash positions of the branch is Job

enrichment while as instructing to accept receipts as also make payments is job

enlargement.

o PERFORMANCE APPRAISAL: Performance appraisal is a process where an employee’s

performance is assessed against the organizational goals set in a given time period.

There are many methods in which appraisals are carried out. The most important and

widely used systems are as follows:

o Management by Objectives (MBO)- Peter Drucker: In its basic form, Management by

Objectives requires managers to set specific measurable goals with each employee and

periodically discuss his progress towards these goals. The term, MBO has now come to

mean the process of a comprehensive, organization- wide goal setting and appraisal

programme. MBO process is distinct from other methods as here the employee under

review is consulted before his targets are fixed for a given term. Periodical reviews are

thereafter conducted and revisions in the targets (higher or lower) made depending on

the latest position. In Banks, MBO method is used while appraising Branch

managers/Regional managers and so on who are profit centre heads. The MBO


approach does away with the judgmental role of the superiors in the appraisal of their

subordinates.

o 360 Degree Performance Appraisals: The 360 degree technique is understood as

systematic collection of performance data on an individual or group, derived from a

number of stakeholders-such as the immediate supervisors, team members,

customers, peers and includes self appraisal. The 360 degree appraisal provides a

broader perspective about an employee’s performance. The strength of this system

lies in the fact that no one individual’s negative perceptions / attitudes are given

importance and a balanced view emerges.

o PERCEPTION: The term “Perception” refers to the manner in which a person

experiences the world. It is the process by which people organize, interpret and

experience ideas and use stimulus materials in the environment so that they satisfy their

needs. People act as they perceive and different people perceive the same things

differently based on their own emotional, information, knowledge and need levels.

o Selective Perception: People tend to perceive what is in accordance with their needs,

motives and interests. Perception is basically a selective process. As people can see only

limited amount of information in the environment, they are characteristically selective.

By selection, certain aspects of stimuli are screened out and others are admitted. Those

which are admitted remain in the awareness of the people and those which are

screened out fall below the threshold.

o Projection: Projection is the process of attributing one's own traits or characteristics to

the people being judged. This tendency can distort perceptual judgments about others.

This may be particularly true regarding undesirable traits, which the perceiver possesses

but fails to recognize in himself. One who is dishonest may be suspicious of others and

may perceive dishonest intentions in others where they do not exist.

o Stereotyping: Judging people on the basis of the characteristics of the group to which

they belong is called "stereotyping". Earlier applied for ethnic prejudices only, it has now

come to be used as a short-cut to predicting the behavior of people. Some examples of

common stereotypes are that all Americans are materialistic, all Japanese are

nationalistic, and all Germans are industrious.

o Halo Effect: It refers to tendency of drawing a general impression about an individual

based on a single characteristic such as intelligence, sociability or appearance. This is a

very common type of error committed by managers while evaluating the

subordinates. The most common halo effect in our society is assuming that a person is

intelligent or smart just because he has one good trait of neatness of appearance or

good English.

o Performance Appraisal: Performance appraisal, is a process by which the job performance of an employee is evaluated (generally in terms of quality, quantity, cost


and time). Appraisals are a part of career development. Several methods and techniques are used for evaluating employee performance.

o CONFIDENTIAL REPORT o FREE FORM OR ESSAY METHOD o STRAIGHT RANKING METHOD o PAIRED COMPARISONS METHOD o FORCED DISTRIBUTION METHOD o GRAPHIC RATING SCALES o MANAGEMENT BY OBJECTIVES (MBO) o 360 DEGREE PERFORMANCE APPRAISALS o ASSESSMENT CENTRES

o Philosophy of Responsible Banking: banks can make a positive impact on economic development by influencing environmental, social and ethical outcomes by integrating the principles of Corporate Social Responsibility and Sustainable Development and Sustainable Reporting with their business strategy.

o CSR steps for Banks: o COMMITMENT TO SUSTAINABILITY o COMMITMENT TO 'DO NO HARM' o COMMITMENT TO RESPONSIBILITY o COMMITMENT TO ACCOUNTABILITY o COMMITMENT TO TRANSPARENCY

3.Different Terminologies:

CAPITAL MARKET TERMINOLOGY CARRY FORWARD TRADING: Carry forward trading was evolved in response to local needs in

India and it refers to the trading in which the settlement is postponed to the next account

period on payment of contango charges (known as vyaj badla) in which the buyer pays

interest on borrowed funds or the backwardation charges (known as undha badla) in which

the short seller pays a charge for borrowing securities. Carry forward trading has now been

discontinued.

CIRCUIT BREAKERS: It is mechanism by which stock exchanges temporarily suspend the

trading in security when its prices are volatile and tend to breach the price band.

COUPON RATE: The coupon rate is the nominal rate offered on the debt instrument. It is

indicated in the bond / debenture / FD certificate. The coupon rate is often confused as

interest rate, which is not correct. Interest undergoes change due to the change in the

economy, whereas the coupon rate is the contracted rate and is fixed during the tenure of

the security.

EMPLOYEE STOCK OPTION: The term 'ESOP' or 'employee stock option plan' is used for certain

kinds of schemes that are used to remunerate, reward and retain employees. They take various

forms - stock option schemes, share purchase schemes, stock appreciation schemes, sweet


equity, etc. Their distinguishing feature is that the reward is directly linked with the

appreciation of the company's share price.

ESCROW ACCOUNTS: An Escrow consists of cash or documents that are kept either partly or

fully, out of the reach of the contracting parties, which serves as back up in the event of a

default by any of the contracting parties. No diversion of funds is allowed. Escrow account

could be central account where all collected revenue is deposited or a specific account where

credits come from specific users.

EX-BONUS: The share is described as ex-bonus when a potential purchaser is not entitled to

receive the current bonus, the right to which remains with the seller.

FORWARD TRADING: Forward trading refers to trading where contracts traded are settled at

some future date at prices decided on the day of contract.

GREEN RATING: Rating of business organizations based on their pollution levels.

INSIDER TRADING: Trading in a company's shares by a connected person having non-public,

price sensitive information, such as expansion plans, financial results, takeover bids, etc. by

virtue of his association with that company, is called insider trading.

MARKET LOT: Market lot is the minimum number of shares of a particular security that can be

transacted on the stock exchange. Multiples of the market lot can also be transacted.

MARKED TO MARKET: RBI introduced a system of categorization of GOI securities into

permanent and current (the portion also called marked to market). To start with, the ratio

was 70 : 30 for permanent and current category which was progressively increased and at

present, from 1998–99 it is 30 : 70 for permanent and current.

NON-DELIVERY PERIOD: Whenever a book closure or record date is announced by a company,

the exchange sets a non-delivery period for that security. During the no-delivery period,

trading is permitted in that security. However, these trades are settled only after no-delivery

period is over. This is done to ensure that investors entitlement for corporate benefits is

clearly determined.

ODD LOT: A number of shares that are less than the market lot are known as odd lots. These

shares are non-illiquid in nature, as they cannot be transacted on the exchange.

ORDER DRIVEN TRADING: It is a trading initiated by buy / sell orders from investors / brokers.

OVER THE COUNTER: Trading in those stocks, which are not listed on a stock exchange.

PAY- IN: Pay-in day is the designated day on which the securities or funds are paid in by the

members to the clearing house of the exchange.


PAY-OUT: Pay-out is the designated day on which securities and funds are paid out to the

members by the clearing house of the exchange.

PARTICIPATION CERTIFICATES: In order to provide additional instrument for ironing out the

short-term liquidity within the banking system, inter bank participation certificate have been

introduced to be strictly confined to scheduled commercial banks. These are of two types,

namely, (a) With risk sharing issued for 91 days to 180 days and (b) Without risk sharing

issued not exceeding 90 days.

PRICE RIGGING: When a person or persons acting in concert with each other collude to

artificially increase or decrease the prices of a security, the process is called price rigging.

QUOTE DRIVEN TRADING: Trading where broker / market makers give buy / sell quote for a

scrip simultaneously.

REVERSE BOOK PROCESS: A number of companies in the recent past have taken this route to

delist their shares when investors received a 30% premium over the floor price on an average

basis. In this process investors decide the price and sell their holding of shares to promoters to

give them full control over the company.

CAT BONDS: Catastrophe bonds (commonly known as cat bonds) are widely used in advanced countries. These are intended to transfer insurance risk arising out of natural calamities such as earthquakes, hurricanes and floods, to the capital markets. Cat bonds are risk-related securities that transfer a specified set of risks from a sponsor to the investors. The Economic Survey 2009-10 has indicated that there is scope for introducing these in countries such as India to provide insurance against contingencies.

Budget Terms

REVENUE BUDGET: It consists of the revenue receipts of the government (which is tax revenue plus other revenue) and the expenditure met from these revenues. It has two components:

a) Revenue Receipt b) Revenue Expenditure

REVENUE RECEIPTS: It includes proceeds of taxes and other duties levied by the Centre, interest and dividend on investments made by the government.

REVENUE EXPENDITURE: It is meant for the normal running of government departments and various services, interest charges on debt incurred by the government and subsidies. Any expenditure that does not result in creation of an asset is treated as revenue expenditure. All grants given to State governments and other parties are also treated as revenue expenditure even though some of the grants may be for creation of assets.


CAPITAL BUDGET: It consists of capital receipts and payments. It also incorporates transactions in the Public Account. It has two components: a) Capital Receipt b) Capital Expenditure.

CAPITAL RECEIPT: The main items of capital receipts are loans raised by the government from the public which are called market loans, borrowings by the government from the RBI and other parties through sale of Treasury Bills, loans received from foreign governments and bodies and recoveries of loans granted by the Central Government to State and Union Territory governments and other parties. It also includes proceeds from disinvestment of government equity in public enterprises.

CAPITAL EXPENDITURE: It consists of payments for acquisition of assets like land, building, machinery, equipment, as also investments in shares etc., and loans and advances granted by the Central Government to State and Union Territory governments and other parties.

PLAN EXPENDITURE: Both Revenue and Capital expenditure on the Central Plan, central assistance to State and Union Territory plans. It forms a sizeable proportion of the total expenditure of the Central Government.

NON - PLAN EXPENDITURE: Revenue and Capital expenditure on interest payments, the entire defence expenditure, subsidies, postal deficit, police, pensions, economic services, loans to public enterprises and loans as well as grants to State governments, Union Territory governments and foreign governments.

REVENUE DEFICIT: It refers to the excess of Revenue expenditure over Revenue receipts.

FISCAL DEFICIT: It is a measure of how much the Govt. needs to borrow from the market to meet its expenditure in the situation when its revenues are inadequate. It is the difference between Revenue receipts plus certain Non-debt capital receipts and the total expenditure including loans (net of repayments).

PRIMARY DEFICIT: From the gross fiscal deficit figure, subtract the various interest payments the Govt needs to make on its borrowings. It is difference between fiscal deficit and interest payments.

APPROPRIATION BILL: It is presented to Parliament for its approval, so that the government can withdraw from the Consolidated Fund the amounts required for meeting the expenditure charged on the Consolidated Fund. No amount can be withdrawn from the Consolidated Fund until the Appropriation Bill is voted and enacted.

CONSOLIDATED FUND: It is made up of all revenues received by the government, loans raised by it, and its receipts from recoveries of loans granted by it. All expenditure of the government is incurred from the Consolidated Fund and no amount can be withdrawn from the Fund without authorization from Parliament.

CONTINGENCY FUND: It is an imprest account placed at the disposal of the President and is used by the government to incur all its urgent and unforeseen expenditure. Parliament


approval for such expenditure and for withdrawal of an equivalent amount from the Consolidated Fund is subsequently obtained and the amount spent from the Contingency Fund is recouped to the Fund.

DEMANDS FROM GRANTS: It is a statement of estimates of expenditure from the Consolidated Fund and is required to be voted by the Lok Sabha. Generally, one Demand for Grant is presented in respect of each ministry or department.

EXPENDITURE BUDGET: It contains expenditure estimates made for a scheme or programme under both revenue and capital heads. These estimates are brought together and shown on a net basis at one place by major heads.

FINANCE BILL: This contains the government’s proposals for levy of new taxes, modification of the existing tax structure and so on. It is submitted to Parliament along with the Budget for its approval.

CENTRAL PLAN: It consists of the government’s budget support to the plan and the internal and extra budgetary resources raised by public enterprises.

MONETISED DEFICIT: Indicates the level of support extended by RBI to Govt’s borrowing programme.

PUBLIC ACCOUNT: Account in which money received through transactions not relating to the

Consolidated Fund is held. Besides the normal receipts and expenditure, certain other

transactions enter government account in respect of which the government acts more as a

banker. Such money flows through the Public Account. Thus Public Amount funds do not belong

to the Government and have to be paid back eventually.

VOTE ON ACCOUNT: According to the Indian Constitution, all revenues and loans funds received by the Union government are to be put into the Consolidated Fund of India. Whenever elections are announced, the current Government cannot announce a full-fledged Budget or pass the Finance Act for the entire year. When the government needs to withdraw any money from the Consolidated Fund of India to cover its expenditure, it has to seek first approval from Parliament. This sanction of Parliament for withdrawal of money from the Consolidated Fund of India to meet the government's expenses is generally known as a vote-on-account.

MONETARY AND CREDIT POLICY

Monetary and Credit Policy focuses on two critical variables, namely GDP growth and

acceptable level of inflation i.e., price stability. Based on these variables, RBI works out target range of money supply in the economy. By achieving price stability i.e., inflation, the citizens are enabled to retain their confidence in the economy and the business sector is induced to plan their future activities properly by making realistic forecasts. Controlling the growth of money


supply is the primary concern, since greater the rate of growth of the money supply, compared to growth rate of GDP, the higher will be the rate of inflation. The money supply growth rate is curtailed through open market operations of buying or selling securities.

EXPANSIONARY OR CONTRACTIONARY POLICY

When RBI attempts to lower the cost of funds to spur growth such that cheap and abundant money may persuade industry to set up new capacities or produce to the maximum extent available, it is termed an expansionary policy. On the other hand, when RBI tightens the monetary aggregates, it is called contractionary policy.

MEASURES / TOOLS OF MONETARY POLICY

A) QUANTITATIVE MEASURES: Measures, which aim to control the quantity of money, supply directly such as Cash Reserve Ratio (CRR), Statutory Liquidity Ratio (SLR), Open Market Operations (OMO), increasing the margins.

a) CASH RESERVE RATIO: CRR is a quantitative tool of monetary and credit policy to regulate the money supply in the economy. RBI by varying the CRR regulates the lendable funds of the commercial banks.

Every scheduled Bank has to maintain cash reserves with RBI equal to certain percentage of its net demand and time liabilities on fortnightly basis.

All schedule Banks are required to maintain minimum CRR balance upto 70% of the total CRR requirement on all days of the fortnight.

RBI can prescribe the Cash Reserve Ratio (CRR) for scheduled banks without any floor rate (earlier 3%) and the ceiling rate ( earlier 20%).

RBI does not be pay any interest on the CRR balances maintained by scheduled Banks. b) STATUTORY LIQUIDITY RATIO: SLR is a quantitative tool of monetary and credit policy to

regulate the money supply in the economy. RBI by varying the SLR regulates the lendable funds

of the commercial banks, by way of investment in Govt. securities.

A banking company is required to maintain at the close of business on any day a certain percentage of its total demand and time liabilities in India in form of cash, gold and unencumbered approved securities as on last Friday of second preceding fortnight.

Minimum floor limit and maximum ceiling limit removed.

c) OPEN MARKET OPERATION (OMO): In an effort to regulate the money supply and liquidity conditions, RBI undertakes sale and purchase of Government securities. Open market operation is also be used to stabilize the prices of government securities. When RBI buys securities in the open market, it increases the liquidity and reserves of commercial banks, making it possible for them to expand their loans and investments. It also increases the price of government securities, equivalent to reducing their interest rates, and decreases interest rates generally,

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thus encouraging investment. If the RBI sells securities, the effects are reversed. OMO are usually performed with short-term Govt. securities such as Treasury bills.

B) QUALITATIVE MEASURES: They aim to control the quantity of money supply indirectly

through cost of credit. These measures are Bank Rate, Repo rate, Interest rates, etc.

a) BANK RATE: It is the standard rate at which RBI is prepared to buy or re-discount bill of

exchange or other commercial paper eligible for purchase. In a situation where RBI increases

Bank Rate, the cost of funds for the bank increases. This in turn will make the banks raise its

lending rates thereby discouraging the borrowings. At present, the bank rate is 6%.

b) REPO RATE: Repo rate and Reverse Repo rate are Liquidity Adjustment Facility (LAF) tools

used by RBI. Repo is an instrument meant for injecting the funds required and Reverse Repo for

absorbing the excess liquidity of Banks.

KEY FINANCIAL INDICATORS

ACCRETION TO EQUITY: (Retained earnings / Total equity at the end of previous year) x 100. AVERAGE BUSINESS: Total of Average deposits and total advances. AVERAGE COST: (Interest expended on deposits and borrowings/Average interest bearing

liabilities) x 100. AVERAGE WORKING FUNDS (AWF): Fortnightly average of total assets. AVERAGE YIELD: (Interest and discount earned/average interest earning assets) x 100. BUSINESS PER BRANCH: Average Deposits + Average Advances / No. of Branches BUSINESS PER EMPLOYEE: Average Deposit + Average Advances / Total No. of Employees. CASA DEPOSIT: Deposit in bank in Current and Savings account. COST OF DEPOSITS: Interest paid on deposits divided by average deposits. CREDIT DEPOSIT RATIO: Total Advance / Total Deposits. COST INCOME RATIO (EFFICIENCY RATIO): The cost income ratio reflects the extent to which

non-interest expenses of a bank make a charge on the net total income (total income – interest expense). The lower the ratio, the more efficient is the bank. Formula: Non interest expenditure / Net Total Income x 100.

FUNDING VOLATILITY RATIO: Liquid assets to Current and Savings deposits - (Higher the ratio, the better is the position).

HIGH COST DEPOSIT: Deposits accepted above card rate (for the deposits) of the bank. LIQUID ASSETS: Liquid assets consists of: cash, balances with RBI, balances in current

accounts with banks, money at call and short notice, inter-bank placements due within 30 days and securities under “held for trading” and “available for sale” categories excluding securities that do not have ready market.

MARKET LIABILITY RATIO: Inter-bank and money market deposit liabilities to Average Total Assets

NET NON-INTEREST INCOME: The differential (surplus or deficit) between non-interest income and non-interest expenses as a percentage to average total assets.


NET INTEREST INCOME (NII): The NII is the difference between the Interest Income and the Interest expended.

NET INTEREST MARGIN (NIM): Net Interest Margin is the net interest income divided by average interest earning assets.

NET OPERATING PROFIT: Operating profit before provisioning minus provision for loan losses, depreciation in investments, write off and other provisions.

NET PROFIT / AWF: Net Profit / Average Operating Funds OPERATING EXPENSES: Total Expenses minus interest expenses. OPERATING PROFIT BEFORE PROVISIONS: Net of total income and total operating expenses. PROFIT BEFORE TAX (PBT): (Net operating profit +/- realized gains/losses on sale of assets). PROFIT AFTER TAX (PAT): Profit before tax – provision for tax. RETAINED EARNINGS: Profit after tax – dividend paid/proposed. RETURN ON ASSET (ROA) - AFTER TAX: Return on Assets (ROA) is a profitability ratio which

indicates the net profit (net income) generated on total assets. It is computed by dividing net income by average total assets. Formula- (Profit After Tax / Average Total Assets) x 100.

RETURN ON EQUITY (ROE) - AFTER TAX: Return on Equity (ROE) is a ratio relating net profit (net income) to shareholders’ equity. Here the equity refers to share capital reserves and surplus of the bank. Formula- Profit After Tax / (Total Equity + Total Equity at the end of previous year) / 2 } x 100.

TOTAL BUSINESS: Deposits + Advances TOTAL INCOME: Sum of interest + discount earned, commission, exchange, brokerage and

other operating income. TOTAL OPERATING EXPENSES: Sum of interest expended, staff expenses and other

overheads. YIELD ON ADVANCES: Interest on Advances / Average Advances.

OPTIONS

An Option contract gives the holder of an Option a right to buy or sell an underlying Security /

Share / Currency / Index etc., at a predetermined rate. However there is no obligation to do so.

The purchase of an Option requires an upfront fee payment. Options are used as hedging

instruments in Equity and Foreign Exchange markets.

OPTIONS TERMINOLOGY:

Index Options: These Options have an Index ( such as NIFTY ) as the underlying. Some Options are European while others are American. Index Options contracts are cash settled.

Stock Options: Stock Options are Options on individual stocks. A contract gives the holder the right to buy or sell shares at the specified price.

Buyer of an Option: The buyer of an Option is the one who by paying the Option premium to buy the right but not the obligation to exercise his Option on the seller/ writer.


Writer of an Option: The writer of an Option is the one who receives the Option premium and is thereby obliged to sell / buy the asset if the Option buyer wishes to exercise his Option.

TYPES OF OPTIONS

There are two basic types of Options namely Call Options and Put Options.

CALL OPTION: A Call Option gives the holder the right but not the obligation to buy an asset by

a certain date for a certain price.

PUT OPTION: A Put Option gives the holder the right but not the obligation to sell an asset by a

certain date for a certain price.

AMERICAN OPTIONS: American Options are Options that can be exercised at any time up to

the expiration date. Most exchange traded Options are American.

EUROPEAN OPTIONS: European Options are Options that can be exercised only on the

expiration date. European Options are easier to analyse than American Options, and properties

of an American Option are frequently deduced from those of its European counterpart.

Currently, in India, only European Options are traded.

OPTION PRICE: Option Price is the price which the Option buyer pays to the Option seller. It is

also referred to as the Option premium.

EXPIRATION DATE: The date specified in the Options contract is known as the expiration date,

the exercise date, the Strike date or the maturity.

STRIKE PRICE: The price specified in the Options contract at which the Underlying will be sold or

bought is known as the Strike price or the Exercise price.

IN-THE-MONEY OPTION: An In-the-Money (ITM) Option is an Option that would lead to a

positive cash flow to the holder if it were exercised immediately. A Call Option on the Index is

said to be in-the-money when the current value of Index stands at a level higher than the Strike

price (i.e. Spot price > Strike price). If the value of Index is much higher than the Strike price, the

call is said to be deep ITM. On the other hand, a put Option on Index is said to be ITM if the

value of Index is below the Strike price.

AT-THE-MONEY OPTION: An At-the-Money (ATM) Option is an Option that would lead to zero

cash flow if it were exercised immediately. An Option on the Index is at-the-money when the

value of current Index equals the Strike price (i.e. Spot price = Strike price).

OUT-OF-THE-MONEY OPTION: An Out of-the-Money (OTM) Option is an Option that would

lead to a negative cash flow if it was exercised immediately. A Call Option on the Index (For


example) is said to be Out-of-the-money when the value of current Index stands at a level

which is less than the Strike price (i.e. Spot price < Strike price). On the other hand, a Put Option

on Index is OTM if the value of Index is above the Strike price.

INTRINSIC VALUE OF AN OPTION: The Option premium can be broken down into two

components - Intrinsic value and Time value. Intrinsic value of an Option is the difference

between the market value of the underlying security / index in a traded Option and the Strike

value. Both Calls and Puts have time value. An Option that is OTM or ATM has only time value.

Usually, the maximum time value exists when the Option is ATM. The longer the time to

expiration, the greater is an Option’s time value, all else equal. At expiration, an Option should

have no time value. While intrinsic value is easy to calculate, time value is more difficult to

calculate.

HRD GLOSSORY:

HUMAN RESOURCE ACCOUNTING: Computing the value of an organization's human assets along with its financial assets.

HUMAN RESOURCE MANAGEMENT (HRM): A process consisting of the acquisition, development, motivation, and maintenance of human resources.

HUMAN ASSET ACCOUNTING METHOD: In this method money estimates are attached to the value of an organisation's personnel and its external goodwill. The principle behind this system is that like any other asset, human asset is also valuable to the organisation. If any trained and experienced employee leaves, the human asset value depreciates and if some one joins the organisation bringing with him the skills and experience important to it, the human asset value increases.

HUMAN RESOURCE SYSTEM (HRS): HRS is a sub-system of a larger system (organisation). The main task of HRS is to develop enabling capabilities (proacting role) All managers share the responsibility of human resource management. The main emphasis of HRS is on developing people and their competencies. People are primarily motivated by challenges and opportunities for development and creativity.

HUMAN RESOURCE PLANNING: The process by which an organization ensures that it has the right number and kinds of people, at the right places, at the right time, capable of effectively and efficiently completing those tasks that will aid the organization in achieving its overall objectives.

ACHIEVEMENT NEED: The drive to excel, to strive to succeed.

BEHAVIOURALLY ANCHORED RATING SCALES (BARS): This is a new appraisal technique. The jobs are described through illustrations or by giving critical incidents of effective and ineffective performance. Based on these incidents a rating scale is devised. A set of incidents are used as behaviour anchors for the performance dimensions. While the system is objective, it is very time consuming.


CENTRALISATION: Centralisation is the systematic and consistent reservation of authority at central points in an organisation. Everything which goes to increase the importance of the subordinate's role is decentralisation everything which goes to reduce it is centralisation.

COMMUNICATION: Communication is the process of exchanging information and understanding between people. The topic of communication can be studied from two angles namely interpersonal communication and organisational communication. The interpersonal communication is a seven-part process. The parts are: a) Sender b) Encoding c) Message. d) Channel e) Decoding f) Receiver and g) Feedback. Each part is significant in making the communication system effective. Communication flows refer to the pattern of communication in organisation. Communication flows are downward, upward, lateral, diagonal and external. Certain barriers to communication affect the communication process and results in ineffective communication. The unit concludes with the guidelines for effective communication.

DELEGATION OF AUTHORITY: Delegation is the dynamic of management, it is the process a manager follows in dividing the work assigned to him so that he performs that part which only he, because of his unique organisational placement, can perform effectively and so that he can get others to help him with what remains.

GROUP DYNAMICS: It is a very effective tool to handle the different kinds of people in the organisation. Man is a social animal and he always feels more secured and protected in groups. In an organization, formal groups are based on the position and status in the organisation and informal groups are formed by the people to fulfil their social needs, formal groups consists of authoritative and organised structure such as Managers, Subordinates (award staff) and informal groups like canteen club, sports association, welfare association etc. The successful Manager always keeps the proper liaison with Informal groups, wins their confidence and uses that trust to run the organisation effectively and deal with the senior colleagues and subordinates.

MANAGEMENT: The process of efficiently getting activities completed with and through other people.

MANAGEMENT DEVELOPMENT: Future-oriented training, focusing on personal growth of the employee.

MANAGEMENT BY OBJECTIVES (MBO): Management by objectives can be described as a process whereby the superior and subordinate managers of an organisation jointly identify its common goals, define each individuals major area of responsibility in terms of results expected of him and use those measures as guides for operating the unit and assessing the contribution of each of its member.

ORGANIZATIONAL CULTURE: The rules, jargon, prejudices, customs, and other traditions that clarify acceptable and unacceptable behaviour in an organization.

ORGANIZATION DEVELOPMENT: A process of systematic change, designed to make organizations more adaptive.

PERFORMANCE APPRAISAL: A formal process in an organization whereby each employee is evaluated to determine how he or she is performing.

PERCEPTION: Perception may be defined as a process by which individuals organise and interpret their sensory impressions in order to give meaning to their environment. Perception


basically refers to the manner in which a person experiences the world. It is the process by which people organise, interpret and experience ideas and use stimulus materials in the environment so that they satisfy their needs.

PERFORMANCE APPRAISAL: Performance appraisal is a systematic, periodic and so far as humanly possible, and impartial rating of employee's excellence in matters pertaining to his present job and to his potentialities for a better job.

PERSONNEL MANAGEMENT: The traditional functional area responsible for the management of human resources.

SELF-ACTUALIZATION: To become what one is capable of becoming; to reach one's full potential.

SIMULATION: Any artificial environment that attempts to closely mirror an actual condition.

VALUES: Basic conviction about what is right or wrong, good or bad, desirable or not.

DIFFERENT TYPE OF GUARANTEES

TENDER / BID BOND GUARANTEE: Construction / Project Contractors are awarded

contracts through a bidding process. This is especially so in the case of public sector

works. The bidding process is costly and time consuming. If a Contractor bids for a job /

project, wins the bid and then refuses to undertake the work, the costly process of

calling for bids has to be repeated. To ensure that only parties with serious intentions

participate in the bidding or tender process, Bid Bond Guarantees (BBG) are called for

from the Contractor (Principal or Applicant) along with the tender or bid. The BBG

normally represents around 5% of the value of the contract. If the Contractor wins the

bid but does not take up the work, BBG will be invoked to make good the loss of time

and money caused by him. Thus a BBG supports the Applicant’s obligation to execute a

contract if a bid is awarded.

Example: If U.P. Government calls bids for the project of cleaning the river Ganga

(Project cost Rs.200 crore) and your customer Progressive Infrastructure (I) Ltd (PGIL)

wants to apply for the contract, PGIL may have to submit their proposal along with a

Bid Bond Guarantee of Rs.10 crore, to demonstrate their seriousness in taking up the

contract if awarded. In case they win the bid and do not take up the work, UP

Government will invoke the Guarantee and the issuing Bank has to pay Rs.10 crore to

UP Govt. first and recover it from PGIL in due course.

EARNEST MONEY / SECURITY DEPOSIT GUARANTEE: In most cases, the contractors are

asked to deposit a certain sum of money as Security deposit or Earnest money. The

terms of the contract will provide for refund of this deposit either in stages (reflected in

periodical bills submitted) or in a lump sum at the end of successful execution. Here


again, an Earnest Money Bank Guarantee will satisfy the requirements of both the

parties.

ADVANCE PAYMENT GUARANTEE (APG): Advance Payment Guarantee comes in to

picture after a contract work is awarded to the applicant. This Guarantee supports an

obligation to account for an advance payment made by the Beneficiary to the

Contractor. The contractor who is awarded the project is allowed to draw advance

money to facilitate initiation of the actual work. In case he draws advance money but

does not complete the corresponding work, the Guarantee can be invoked. To

overcome the issue of which comes first (Advance or Guarantee), Advance Payment

Guarantees normally contain a clause that the Guarantee is inoperative until the

Advance Payment has been received by the Applicant. Such Guarantees also contain a

“Liability reduction clause” which ensures that the liability under the Guarantee is

reduced proportionately as the work progresses and bills are submitted against the

advance drawn.

Example: Once the contract is awarded to PGIL, UP Government may sanction advance

money of Rs.50 crore (25% of the project cost) to PGIL to proceed with the project. PGIL

can draw the funds against submission of an Advance Money Guarantee for either full

amount of Rs.50 crore or part thereof, depending upon the terms of the contract. At

this stage, the Bid Bond Guarantee will be received back by the Bank and cancelled.

Many times, there is a provision in the BBG, allowing it to be retained as Advance

Money Guarantee. However, this should be a conscious decision on the part of the

issuing Bank. BBGs should be drafted carefully to avoid confusion.

PERFORMANCE GUARANTEE: This is a type of Guarantee that stipulates an obligation to

pay for losses which may arise as a consequence of the Applicant failing to fulfill his

obligations under the contract. The performance should be satisfactory on many

variables such as Time (project should be completed on time), Scope (all works agreed

upon should be completed), Cost ( expenses should be within the budget), Quality (

quality of the work should be as per stipulated standards / bench marks) and so on. In

Turn-key projects, normally, Performance Guarantees not only cover physical aspects of

construction and delivery on time but also aspects such as timely transfer of technology,

training of staff, warranty for equipment installed and so on. These Guarantees may be

a single all encompassing Guarantee or several specific Guarantees (Training Guarantee,

Maintenance Guarantee, Warranty Performance Guarantee and so on). Performance

Guarantees should be issued selectively. The past performance of the Applicants, their

experience, capacity to execute, financial abilities and all such aspects have to be

thoroughly checked during appraisal. RBI has directed that as a general rule, Banks


should confine themselves to Financial Guarantees and exercise due caution with regard

to Performance Guarantee business.

Example: In the case of “Clean Ganga Project”, if the UP Government demands an all

encompassing Performance Guarantee from PGIL, the Bank has to verify all aspects as

above and then only issue the Guarantee subject to margins and collaterals etc as per

the Bank’s policy.

RETENTION MONEY GUARANTEE (RMG): Once the Project is completed successfully,

the Contractor would want immediate settlement of the bills but the project owner may

need time for inspection. In huge projects, the process of handing over charge of the

Project itself may take months. Under such circumstances, the Contractor would submit

a “Retention Money Guarantee” based on which the final bill will be settled

immediately. The Retention Money Guarantee will promise that in case of any defects

or infirmities discovered within a given period, the Contractor would compensate or

bear the loss. All the Beneficiary has to do is to send a demand to the Issuing Banker.

Example: In the “Clean Ganga “project, the UP Government will be the beneficiary of

the Retention Money Guarantee submitted by the contractor PGIL. The final bills

submitted by PGIL can be settled without any delay. Both parties would benefit from

such an arrangement.

MISC RATES

BENCH MARK INTEREST RATES:

Benchmark rates such as LIBOR, SIBOR, MIBOR and so on give directions to the markets.

A good benchmark reference rate provides the pulse of the market for the day as it is

collated in early market hours from important market participants. These contributors

weigh their options on various factors that would drive their lending and borrowing

business during the course of the day and quote their rates nominally. Such benchmark

rates have the respect of the market participants and are used widely.

LONDON INTER BANK OFFERED RATE (LIBOR):

LIBOR is the rate at which major banks in London are willing to lend to each other. It is

used to determine the interest rate charged to credit worthy borrowers. LIBOR rates,

based on daily quotes at 11 A.M. (London time) from five major London banks, are fixed

rates quoted for specific maturities. The lending rate in the Euromarkets (LIBOR) and the

borrowing rate (LIBID), are quoted for the U.S. Dollar and Eurocurrencies, generally for

fixed-term borrowings. LIBOR, also called BBA LIBOR is produced for ten currencies with

15 maturities quoted for each, ranging from overnight to 12 months producing 150

rates each business day.


EURO INTERBANK OFFERED RATE (EURIBOR):

EURIBOR is used as a reference rate for Euro-denominated forward rate agreements,

short term interest rate futures contracts and interest rate swaps, in very much the

same way as LIBORs are commonly used for Sterling and US Dollar-denominated

instruments. A representative panel of banks provides daily quotes of the rate for

interbank term deposits within the Euro zone, for maturity ranging from one week to

one year. Every Panel Bank is required to directly input its data no later than 10:45 a.m.

Central European Time (CET) on each day when the Trans-European Automated Real-

Time Gross-Settlement Express Transfer system (TARGET) is open. At 11:00 a.m. (CET),

Reuters will process and publish the Euribor.

SINGAPORE INTER-BANK OFFERED RATE (SIBOR):

The interest rate at which banks located in Asian time zones can borrow funds from

other banks located in the region. In Asia, the SIBOR is used more commonly than the

LIBOR. It is set daily by the Association of Banks in Singapore (ABS). SIBOR serves as a

benchmark or reference rate for borrowers and lenders that are directly or indirectly

involved in an Asian financial market.

MUMBAI INTER-BANK OFFER RATE (MIBOR):

The National Stock Exchange (NSE) developed and launched the NSE Mumbai Inter-bank

Bid Rate (MIBID) and NSE Mumbai Inter-bank Offer Rate (MIBOR) for the overnight

money market in 1998. The success of the Overnight NSE, MIBID / MIBOR encouraged

the Exchange to develop a bench mark rate for the term money market and it launched

the 14-day / 1 month and 3 Month NSE MIBID / MIBOR rates in 1998. The MIBID /

MIBOR rate is used as a bench mark rate for majority of deals struck for Interest Rate

Swaps, Forward Rate Agreements, Floating Rate Debentures and Term Deposits. To take

the process of development further, Fixed Income Money Market and Derivative

Association of India (FIMMDA) and NSE (I) Ltd have taken the initiative to co-brand the

dissemination of reference rates for the Overnight Call and Term Money Market The

product was rechristened as 'FIMMDA-NSE MIBID / MIBOR'. This benchmark is now

jointly disseminated by FIMMDA as well as NSEIL through their websites and other

means for simultaneous dissemination of the information as per international practice

COLLATERALIZED BENCHMARK REFERENCE RATES (CCBID / CCBOR):

CCIL has been releasing CCBID/CCBOR with effect from March’06. The rates are derived

out of orders placed in the Collateralized Borrowing and Lending Obligations (CBLO)

market. CBLO segment has been in the forefront of the short term market for a long

time and it leads the other short term markets like repo and call in setting up the rates.

http://www.answers.com/topic/forward-rate-agreement

http://www.answers.com/topic/futures-contract

http://www.answers.com/topic/interest-rate-swap

http://www.answers.com/topic/london-interbank-offered-rate

http://www.answers.com/topic/pound-sterling-1

http://www.answers.com/topic/united-states-dollar-2

http://www.answers.com/topic/central-european-time

http://www.answers.com/topic/target-3002

http://www.answers.com/topic/reuters-group-plc-adr


It is the largest short term market in terms of volume. The CCBID / CCBOR rates are

released at 10.10AM on the basis of the orders received in CBLO market by 10.00AM.

MUMBAI INTERBANK FORWARD OFFER RATE (MIFOR):

MIFOR was a mix of the London Interbank Offer Rate (LIBOR) and a forward premium

derived from Indian Forex markets. Initially, the intention of MIFOR was for hedging

purposes. However, as many corporate entities used MIFOR for currency speculation,

RBI, concerned over the potential economic downside risk of speculative off-balance-

sheet entities (such as currency swaps), banned the use of MIFOR as a benchmark on

May 20, 2005. However, RBI relaxed the ban later and allowed MIFOR to be used only in

interbank related transactions.

MARKETING

a. MARKETING: Marketing is a term applied to the craft of linking the Producers (or

Potential Producers) of a Product or Service with Customers, both existing and

potential. Marketing is a four step process that begins with analyzing and

defining Potential Users or Buyers. After this, a true marketing effort succeeds in

capturing the attention of the intended Buyers. Third, systematic effort must be

put into getting the Prospects to accept the concepts or propositions being

offered via the marketing effort. Finally, with all three of the previous steps

achieved, the marketer must convert the prospective buyer into an actual buyer

by getting them to take the desired action / decision of purchasing your

Products.

b. EXTERNAL MARKETING: External Marketing is the process of marketing the

Bank’s products/schemes to the external Consumer and the Public in general.

The Bank uses the offer of a good Product mix through an appropriate

promotion campaign to conduct External marketing. Advertisements, Publicity

and Direct Selling and Direct Marketing are the tools used for External

marketing.

c. INTERNAL MARKETING : Internal Marketing is an ongoing process that occurs

strictly within a Bank or Organization whereby the Management motivates and

empowers employees at all management levels to consistently deliver a

satisfying customer experience. The Management takes pains to familiarize the

employees with the products and schemes of the Bank. According to Burkitt and

Zealley, "the challenge for Internal Marketing is not only to get the right

messages across to the employees, but to embed them in such a way that they


both change and reinforce employee behavior". It involves creating the enabling

culture that empowers the employees through allowing creativity, innovation,

initiatives and ensuring Accountability and Responsibility for their decisions.

Internal Marketing encourages the internal market (employees) to perform

better and helps Non-marketing staff to learn and be able to perform their tasks

in a marketing-like manner. It improves Customer retention and individual

employee development.

d. MARKET SEGMENTATION: It is the process of grouping a Market into smaller

Subgroups and focusing the marketing efforts on the Subgroup. The total market

for any product is often made up of submarkets (called segments). These

segments are homogeneous within (i.e. people in the segment are similar to

each other in their attitudes about certain variables). Because of this intra-group

similarity, they are likely to respond somewhat similarly to a given marketing

strategy. That is, they are likely to have similar feelings about a marketing mix

comprised of a given product, sold at a given price, distributed in a certain way,

and promoted in a certain way. For example, “Luxury car products” are aimed at

the segment of the ewly rich urban youth and “Retirement products” are sold to

people in the age group of 50 and above etc. Thus, marketing efforts are

directed at groups of people with similar traits/backgrounds. This way, the

results are better and expenses are lower.

e. CONSUMER BEHAVIOR: Consumer Behaviour is the study of how people buy,

what they buy, and why they buy. It is a part of marketing that blends elements

from psychology, marketing, and economics. It attempts to understand the

buyer decision making process, both individually and in groups. In the

“Consumer Behaviour process” marketing efforts are directed at the “Black box”

or the minds of the customers with the anticipation of getting favourable

purchasing decisions from the consumer. BRANDING: The American Marketing

Association (AMA) defines a brand as a "name, term, sign, symbol or design, or a

combination of them intended to identify the goods and services of one seller or

group of sellers and to differentiate them from those of other sellers. Branding is

all about getting across to your customers and prospects with a clear message

that confirms your credibility, connects your target prospects emotionally and

motivates the consumer to transact with your company/Bank. The Brand will

also ensure “User Loyalty”. To succeed in branding you must understand the

needs and wants of your customers and prospects. This can be done by

integrating brand strategies through the Bank at every point of public contact.

Your brand resides within the hearts and minds of customers, clients, and


prospects. It is the sum total of their experiences and perceptions, some of

which you can influence, and some that you cannot.

f. MOMENTS OF TRUTH : Customers interface with Banks in many different ways

and places, both formally and informally. The customer interface is made up of

all moments where the customer has an experience and associates this with the

name of the Bank. Thus, using products, telephoning the Bank, receiving your

emails/ brochures watching advertisements, visiting the Bank its representatives,

and all such moments imply customer interface. All such moments are together

called the “Moments of Truth”. The term ‘Moment of Truth' was coined by Jan

Carlzon. He used the term to mean those moments in which important brand

impressions are formed and where there is significant opportunity for good or

bad impressions to be made. First impressions are often critical moments. When

customers have certain expectations and they are disappointed, then they can

form very negative impressions or feel a sense of betrayal. It is critical to manage

customer interactions or “Moments of truth” in such a way as to enhance our

desired image and give the best experience to the customers.

GENERAL BANKING AND FINANCIAL TERMS: 01. ABC ANALYSIS : A selective approach to inventory control which calls for a greater concentration on inventory items accounting for the bulk of usage value. 02. ACCRUALS : Usually net profit plus depreciation which are available to the enterprise for meeting term loan obligations and other such commitments not already charged to the profit and loss account. Also called as Cash Accruals. 03. ACID TEST RATIO : A liquidity measure, which helps in testing the ability of the firm to meet its short-term financial obligations. This is worked out as current assets less inventory divided by current liabilities; also known as QUICK RATIO. 04. ACTIONABLE CLAIM : Actionable claims include either unsecured debts or claims to beneficial interests in movable property not in the possession of the claimant. The debts or beneficial interests may be present or future, conditional or contingent. Book debts are actionable claims under law. 05. AMALGAMATION : The union or merging of two or more firms or companies to form one new business. Amalgamation is one way for achieving expansion of business. 06. AMORTISATION : The gradual extinguishment of any amount over a period of time, as, the retirement of a debt by serial payments to the creditor or into a sinking fund; the periodic write down of a insurance premium. 07. ARBITRAGE : Process of selling overvalued and buying undervalued assets in related markets which are temporarily out of equilibrium. 08. ARRANGEMENT LETTER : An arrangement letter is a letter addressed to the borrower advising him in detail of all the terms and conditions of the advance.


09. ARTICLES OF ASSOCIATION :In a limited company, the document setting out the rules which will govern the internal conduct of the company, and dealing with such matters as the transmission and forfeiture of shares, the powers and duties of directors, proceedings at general meetings, the voting of members etc. 10. ASSET LIABILITY MANAGEMENT : The technique of managing both sides of the balance sheet,i.e., assets and liabilities is known as asset liability management. Asset Liability Management is a combination of the techniques of asset management, liability management and spread management into a cohesive process leading to coordinated management of the bank’s entire balance sheet. 11. ASSETS CLASSIFICATION : Introduced to Indian Banks on the recommendations of Narasimham Committee constituted by Government of India. As per the norms, all loan assets of banks in India are to be classified into Standard, Sub-Standard, Doubtful and Loss assets introduced from the financial year 1992—93. 12. ATTACHMENT : Attachment is seizure of property so that it can be put under the control of a court. 13. ATTESTATION : Attestation is formal witnessing of a signature. In law, three documents require attestation compulsorily : i) a mortgage deed, ii) a deed of gift and iii) a will. 14. BAILMENT : The delivery of goods to a person in trust on the terms that the goods will be returned when the purpose for which they were bailed has been effected. 15. BALANCE OF PAYMENTS :It is the difference between payments (outgo) and receipts (income) for visible as well as invisible imports and exports respectively. 16. BALANCE OF TRADE :It is the difference between the value of exports of tangible (visible) goods and the value of imports of tangible goods of the country during a particular period, usually a year. 17. BALANCE SHEET : It is a statement of the assets and liabilities of a business as at a particular date. Assets are the property, like cash and amounts due from others; liabilities represent the amounts due to others. 18. BALLOON PAYMENT : A term loan is made repayable in periodic instalments. Sometimes, the loan is amortized in equal period instalments (may also be unequal) except for the final payment, known as a “balloon” which is larger than any of the others. 19. BANKER’S LIEN : It is the right of a banker to retain such of his customer’s property as comes into his hands in the ordinary course of business as a banker; it is an implied pledge. 20. BENEFIT COST-RATIO (BCR) METHOD : A project selection criterion, it is ratio of total present value of all cash inflows and the initial cash outflow (ie., outlay)— the higher the BCR, the better. 21. BLUE CHIP : A term of American origin used to describe the shares of progressive soundly run public limited companies, which are not likely to be seriously affected by temporary trade recessions. 22. BOOK VALUE :The net value of a property as it appears in the books of a company, as distinguished from its market value or some intrinsic value. 23. BREAK-EVEN POINT : Indicates the volume of sales at which total costs are equal to total revenues and profits equal zero; the level of operations where the firm neithermakesaprofit nor incurs a loss.


24. BRIDGE FINANCING : A form of interim loan, generally made between a short term loan and a permanent (long term) loan, when the lender of permanent loan needs time to disburse the loan. 25. CAPITAL ASSET : Asset (such as plant and machinery) with an expected productive life of more than a year, that is not bought or sold in ordinary course of business. 26. CAPITAL GAIN/LOSS : A gain or loss resulting from the sale or exchange of asset that are not held as inventory for sale in normal course of business. 27. CAPITAL STRUCTURE :The sources of long term capital of a company., A company’s capital structure is determined by the number and types of shares it issues, and its reliance on fixed interest debt. 28.CAPITALISATION : Conversion of short term funds into permanent sources of funds. 29. CASH BUDGET : A statement showing the forecast of cash receipts and cash disbursements and net cash balance over a period of time. 30. CASH CYCLE : Time between payment for raw materials and collection of accounts receivable. 31. CASH FLOW :Total receipts from sales less actual cash expenditure required to achieve those sales. 32. CASH-LOSS : Loss without providing for depreciation. 33. CHARGE CARD : It gives purchasing power to the holder without a credit facility. The card issuer pays the bills presented by member establishments and the card holder has to clear the bills in a stipulated period. No rolling over of dues is permitted. 34. CLAYTON’S RULE: This refers to a famous case decided in 1816, which is always referred to as the leading authority upon what is known as the “appropriation of payments”. The rule states—”in a running account incoming payments are presumed to be appropriated to outgoing payments in the order in which the items occur”. 35. COMMITMENT FEE : A fee paid on the unused portion of credit line. 36. CONSORTIUM LENDING : Joint financing by two or more banks/financial institutions. 37. CONTINGENT LIABILITY : A liability which can exist definitely only upon the happening of some uncertain event, eg., the liability of a guarantor upon the guarantee which he has given. 38. CREDIT CARD : It offers a credit limit on the assessed credit worthiness of the user. Interest cost is involved here. 39. CREDIT MONITORING ARRANGEMENT (CMA) : A system of post sanction scrutiny introduced by RBI in place of erstwhile Credit Authorisation Scheme. Under CMA, all proposals for the sanction or renewal of credit limits of working capital (funded) of Rs.10 crore and above, are required to be submitted to RBI for post sanction scrutiny, which in 15 days from the date of sanction by the bank. 40. CREDIT RATING : Categorisation of borrowers according to their financial conduct and status. 41. CURRENT ASSETS : Assets which are generally expected to be or can be converted into cash within the next 12 months or during the operating cycle. 42. CURRENT RATIO : Current assets divided by current liabilities; used as a measure of liquidity. Also called LIQUIDITY RATIO. 43. DEBIT CARD : It helps to draw on bank accounts at selected member establishments. No assessment of credit worthiness is made. No interest cost is involved as own funds are used.


44. DEBT EQUITY RATIO : Total outside liabilities divided by tangible networth. This indicates the dependence of the firm on borrowed funds. 45. DEBT SERVICE COVERAGE RATIO : Total cash accruals, ie., net profit plus depreciation divided by annual maturing obligations. This measures a firm’s ability to meet its incurring fixed obligations such as term loan instalments, lease payments, etc. 46. DEFERRED PAYMENT : This is normally in the context of term loan which is paid in instalments over a period exceeding one year. 47. DEFERRED PAYMENT GUARANTEES :These refer to those financial guarantees issued by banks that have a currency period in excess of 12 months. 48. DEPRECIATION : Of assets, a loss in value by wear and tear, obsolescence, etc., or normal deterioration in value which takes place during the life of an asset. This is charged to profit and loss account. The two prominent methods for calculation of depreciation are i) straight-line method, ii) written down value method. 49. DU PONT ANALYSIS : It is a management control chart which links various ratios in such a way that they ultimately reflect the overall performance measure of a company, namely the return on investment. 50. ECONOMIC ORDER QUANTITY (EOQ) : Optimal order quantity as function of usage per period in units, ordering cost per order, and carrying cost per unit per period. It basically represents trade off between two types of costs—the stock-out cost and the cost of carrying inventory. 51. FIRST IN FIRST OUT (FIFO) : Method of valuing inventories and cost of goods sold. Under inflationary conditions, the method overstates closing inventory, understates cost of goods sold, and hence overstates profits. 52. FLOATING CHARGE : A charge created by a company in favour of another party over its undertaking and property in such a form that until the charge crystallises, the company may continue to deal with the property charged. 53. FORECLOSURE : A proceeding in or out of court, to extinguish all rights, titles and interest, of the owner of a property, in order to sell the property to satisfy a lien against it. 54. FUNDS FLOW STATEMENT :This refers to the sources and uses of funds. The statement is prepared with the objective of determining, for a given period of time, from where funds were/will be received and to what use they were/will be put. 55. LAST IN FIRST OUT (LIFO) : Method of valuing inventories and cost of goods sold. Under inflationary conditions the method understates ending inventory, overstates cost of goods sold, and hence understates profits. 56. MERGER : It is a combination of two or more firms into one firm. A merger may involve absorption ( acquisition) or consolidation. In an absorption, one firm acquires one or more other firms. In a consolidation, two or more firms combine to form a new entity. 57. MEZZANINE DEBTS :It is a participatory debt scheme, wherein the institutions share a certain percentage of profits from the financed project. This form of financing is done by fixing coupon very low to cover the cost of funds and share a part of the profits. 58. NET PRESENT VALUE : It is method for evaluating investment proposals. NPV is defined as present value of benefits minus present value of costs. 59. OPERATING CYCLE : The period involved from the time cash is invested in inventory until the


time cash is received from sale of goods. 60. OPERATING PROFIT : Profit earned through the main activities of the enterprise; excess of total operating income over total operating expenses. 61. OPPORTUNITY COST : Presumptive cost incurred in selecting a decision alternative, because profit is foregone on other decision alternatives which are not selected. 62. OVERTRADING : This refers to a situation where the scale of operations of an undertaking outstrips availability of financial resources. In overtrading, the turnover will be too high which will ultimately result into shortage of cash. 63. QUICK ASSETS : Assets which can be converted into cash quickly and easily, eg., cash, bank balance, marketable securities - excluding inventory. 64. SECURED CREDITORS :A secured creditor is one who has lent money to a borrower against the security of movable or immovable property. 65. SMART CARD : Smart Card technology offers users a new payment option with the convenience of not having to use cash, particularly for small value transactions. 66. SYNDICATED CREDIT : It is an agreement between two or more lending institutions to provide a borrower, a credit facility using common loan documentation. 67. TAKE- OUT FINANCE : Applicable in case of project funding, take-out finance means that the banks extend the long term loans for the first five years or so after which a term lending institution will take over the loan from the bank into its books. 68. WORKING CAPITAL : A firm’s investment in short terms assets, ie., current assets such as cash, inventory, receivables and marketable securities. 69. DEMATERILISATION OF SHARES: The practice of holding shares etc in electronic form with Depositories such as SHCIL and NSDL, whereby the actual physical holding of shares etc is obviated. The participants are issued with depository certificates only. 70. BIO-METRIC VERIFICATION: The process of verifying the identity of a person through the electronic capture of his finger prints, photographs, voice recognition etc. 71. REAL TIME GROSS SETTLEMENT: The process of settlement of inter-bank funds by Reserve Bank of India, on an continuous and ongoing basis as and when the transactions are originated by the member banks for their own transactions and transactions of their clients. 72. HAIRCUT ON COLLATERALS: The load factor by which the valuation of collateral securities is increased or decreased depending upon the risk factor assigned to each item of security. 73. PARRI-PASSU CHARGE:A charge or interest which is ranked equally in priority with another preexisting charge or interest . 74. REVERSE MORTGAGE FINANCE: The practice of extending monthly installments similar to annuities against mortgage of immovable properties, whereby the right of the mortgagor gets extinguished at the end of the annuity period and the ownership of the property gets transferred to the Lender in consideration for the amount lent. The scheme is beneficial for elderly people who have sufficient property but inadequate liquidity and wish to enjoy liquidity for the present without parting possession of their property immediately. 75. CHEQUE TRUNCATION: The process of capturing digital images of Cheques and effecting clearing settlements amongst member banks based on these digital images . PRIORITY SECTOR – UPDATED


MILESTONES

COMMITTEE RECOMMENDATIONS / GUIDELINES

197

2

RBI -

Informal

Study Group

The concept of the Priority Sector was first formulated on the basis of

the report submitted by the Informal Study Group

197

4

-do- Banks advised to raise the share to the level of 331/3% in their

aggregate advances by March 1979.

198

5

Krishnaswa

my

Banks advised to achieve the target of Priority Sector lending at 40 % by

1985. Sub-targets were also specified for lending to Agriculture and the

Weaker Sections within the Priority Sector.

200

7

C.S.Murthy New Priority Sector guidelines - with effect from 30-April-2007.

TARGETS / SUB-TARGETS

DOMESTIC COMMERCIAL BANKS FOREIGN BANKS

TOTAL

PRIORITY

SECTOR

ADVANCES

40% of Adjusted Net Bank Credit (ANBC) or Credit

Equivalent amount of Off-Balance Sheet Exposure,

whichever is higher.

32% of ANBC or CE-

OBE, whichever is

higher.

TOTAL

AGRICULTURAL

ADVANCES

18% of ANBC or Credit Equivalent amount of Off-

Balance Sheet Exposure, whichever is higher.

Of this, indirect lending in excess of 4.5% of ANBC or

Credit Equivalent amount of Off-Balance Sheet

Exposure, whichever is higher, will not be reckoned

for computing performance under 18% target.

However, all agricultural advances under the

categories 'direct' and 'indirect' will be reckoned in

computing performance under the overall priority

sector target of 40% of ANBC or Credit Equivalent

No target


amount of Off- Balance Sheet Exposure, whichever is

higher.

SMALL

ENTERPRISE

ADVANCES

Advances to Small Enterprises sector will be

reckoned in computing performance under the

overall priority sector target of 40% of ANBC or

Credit Equivalent amount of Off-Balance Sheet

Exposure, whichever is higher.

10% of ANBC or

Credit Equivalent

amount of Off-

Balance Sheet

Exposure, whichever

is higher.

MICRO

ENTERPRISES

WITHIN SMALL

ENTERPRISES

SECTOR

40% of total advances to Small Enterprises sector should go to Micro (Manufacturing) Enterprises having investment in Plant and Machinery up to Rs 5 lakh and Micro (Service) Enterprises having investment in equipment up to Rs. 2 lakh;

20% of total advances to Small Enterprises sector should go to Micro (Manufacturing) Enterprises with investment in Plant and Machinery above Rs 5 lakh and up to Rs. 25 lakh, and Micro (Service) Enterprises with investment in equipment above Rs. 2 lakh and upto Rs. 10 lakh. (Thus, 60% of Small Enterprises advances should go to the Micro Enterprises).

Same as for

domestic banks.

EXPORT

CREDIT

Export credit is not a part of priority sector for

domestic commercial banks.

12% of ANBC or CE-

OBE, whichever is

higher.

WEAKER

SECTIONS

10% of ANBC or Credit Equivalent amount of Off-

Balance Sheet Exposure, whichever is higher.

No target

DRI 1% of total advances outstanding as at the end of the

previous year.

Minimum 2/3rd of DRI advances should be given by Rural and Semi – Urban branches, &

40% of DRI advances to Schedule Caste / Schedule Tribe.

No target.

CONCEPTS OF ADJUSTED NET BANK CREDIT (ANBC)

For the purpose of Priority Sector Lending:

ANBC = NBC plus investments made by banks in non-SLR bonds held in HTM category.


Credit Equivalent of Off-Balance Sheet Exposures as defined by DBOD of Reserve Bank of India

from time to time.

ANBC and CEOBE will be computed with reference to the outstanding as on March 31 of the

previous year.

For the purpose of calculation of Credit equivalent of off-Balance sheet exposures, banks may

use Current exposure method.


CATEGORIES OF PRIORITY SECTOR

Sr

.

CATEGORY PARAMETERS AMOUNT

LIMIT

1 AGRICULTURE

DIRECT

FINANCE

DIRECT FINANCE TO AGRICULTURE: It shall include short,

medium and long term loans given for agriculture and allied

activities (dairy, fishery, piggery, poultry, beekeeping, etc.)

directly to individual farmers, [Self-Help Groups (SHGs) or Joint

Liability Groups (JLGs) of individual farmers provided banks

maintain disaggregated data on such finance] for agriculture and

allied activities.

1.1.1. Short-term loans for raising crops, i.e. for crop loans. This

will include traditional / non-traditional plantations and

horticulture.

1.1.2. Advances against pledge / hypothecation of agricultural

produce (including warehouse receipts) for a period not

exceeding 12 months, irrespective of whether the farmers

were given crop loans for raising the produce or not.

1.1.3. Working capital and term loans for financing production

and investment requirements for agriculture and allied

activities.

1.1.4. Loans to small and marginal farmers for purchase of land

for agricultural purposes.

1.1.5. Loans to distressed farmers indebted to non-institutional

lenders, against appropriate collateral or group security.

1.1.6. Loans granted for pre-harvest and post-harvest activities

such as spraying, weeding, harvesting, grading, sorting,

processing and transporting undertaken by individuals,

SHGs and cooperatives in rural areas.

Need Based

Need Based

Rs. 10 lacs

Need Based

Need Based

1.

2

AGRICULTURE

& ALLIED

Finance to others [such as Corporates, Partnership firms and

Institutions] for Agriculture & Allied Activities (dairy, fishery,


ACTIVITIES

DIRECT

FINANCE

piggery, poultry, bee-keeping, etc.

1.2.1. Loans granted for pre-harvest and post harvest activities

such as spraying, weeding, harvesting, grading, sorting and

transporting.

1.2.2. Finance up to an aggregate amount of Rs. One crore per

borrower for the purposes listed at 1.1.1, 1.1.2, 1.1.3 and

1.2.1 above.

1.2.3. One-third of loans in excess of Rs. One crore in aggregate

per borrower for agriculture and allied activities.

Need Based

1 Crore

1.

3

AGRICULTURE

INDIRECT

FINANCE

1.3. FINANCE FOR AGRICULTURE AND ALLIED ACTIVITIES

1.3.1. Two-third of loans to entities covered under 1.2 above in

excess of Rs. One cr. in aggregate per borrower for

agriculture and allied activities.

1.3.2. Loans to Food and Agro-based processing units (other than

individuals / SHGs & Cooperatives in rural areas) with

investments in Plant and Machinery up to Rs. 10 cr,

irrespective of location (even if registered as SSI / Micro

units).

1.3.3. (i) Credit for purchase and distribution of fertilizers,

pesticides, seeds, etc.

(ii) Loans granted for purchase and distribution of inputs for

the allied activities such as cattle feed, poultry feed, etc.

1.3.4. Finance for setting up of Agriclinics and Agribusiness

Centres.

1.3.5. Finance for HP schemes for distribution of agri machinery

and implements.

1.3.6. Loans to farmers through Primary Agricultural Credit

Societies (PACS), Farmers’ Service Societies (FSS) and Large-

sized Adivasi Multi Purpose Societies (LAMPS).

1.3.7. Loans to cooperative societies of farmers for disposing of

the produce of members.

Rs. 40 lacs

Need Based


1.3.8. Financing the farmers indirectly through the co-operative

system (otherwise than by subscription to bonds and

debenture issues).

1.3.9 Existing investments as on March 31, 2007, made by banks

in special bonds issued by NABARD with the objective of

financing exclusively agriculture/allied activities may be

classified as indirect finance to agriculture till the date of

maturity of such bonds or March 31, 2010, whichever is

earlier. Fresh investments in such special bonds made

subsequent to March 31, 2007 will, however, not be eligible

for such classification.

1.3.10 Loans for construction and running of storage facilities

(warehouse, market yards, godowns, and silos), including

cold storage units designed to store agriculture produce /

products, irrespective of their location. If the storage unit is

registered as SSI unit / micro or small enterprise, the loans

granted to such units may be classified under advances to

Small Enterprises sector.

1.3.11 Advances to Custom Service Units managed by individuals,

institutions or organisations who maintain a fleet of

tractors, bulldozers, well-boring equipment, threshers,

combines, etc., and undertake work for farmers on contract

basis.

1.3.12 Finance extended to dealers in drip irrigation/sprinkler

irrigation / agricultural machinery, irrespective of their

location, subject to the condition that the dealer should be

dealing exclusively in such items or if dealing in other

products, should be maintaining separate and distinct

records in respect of such items.

1.3.13 Loans to Arthias (commission agents in rural/semi-urban

areas functioning in markets / mandies) for extending credit

to farmers, for supply of inputs as also for buying the output

from the individual farmers/ SHGs/ JLGs.

1.3.14 Hundred per cent of the credit outstanding under loans

for general purposes under General Credit Cards (GCC).

Rs 30 lacs

per dealer.

Need based


1.3.15 The deposits placed in RIDF with NABARD by banks on

account of non-achievement of priority sector lending

targets/sub-targets and outstanding as on 30-4-2007 would

be eligible for classification as indirect finance to agriculture

sector till the date of maturity of such deposits or March 31,

2010, whichever is earlier.

1.3.16 Loans already disbursed and outstanding as on 30-4-2007

to State Electricity Boards (SEBs) and power distribution

corporations / companies, emerging out of

bifurcation/restructuring of SEBs, for reimbursing the

expenditure already incurred by them for providing low

tension connection / for energising their wells and for

Systems Improvement Scheme under Special Project

Agriculture (SI-SPA), are eligible for classification as indirect

finance till the dates of their maturity/repayment or March

31, 2010, whichever is earlier. Fresh advances will, however,

not be eligible for classification as indirect finance to

agriculture.

1.3.17 Loans to National Co-operative Development Corporation

(NCDC) for on-lending to the co-operative sector for

purposes coming under the priority sector will be treated as

indirect finance to agriculture till March 31, 2010.

1.3.18 Loans to Non-Banking Financial Companies (NBFCs) for on

lending to individual farmers or their SHGs / JLGs.

1.3.19 Loans granted to NGOs / MFIs for on-lending to individual

farmers or their SHGs / JLGs.

2 SMALL

ENTERPRISES

DIRECT

FINANCE

DIRECT FINANCE IN THE SMALL ENTERPRISES SECTOR:

2.1.1 MANUFACTURING ENTERPRISES

(a) Small (Manufacturing) Enterprises: Enterprises engaged in

the manufacture, processing or preservation of goods and whose

investment in plant and machinery [original cost excluding land

and building) does not exceed Rs. 5 crore.

(b) Micro (Manufacturing) Enterprises: Enterprises engaged in

the manufacture/production, processing or preservation of

Need based


goods and whose investment in plant and machinery (original

cost excluding land and building) does not exceed Rs. 25 lakh,

irrespective of the location of the unit.

2.1.2 SERVICE ENTERPRISES

(a) Small (Service) Enterprises: Enterprises engaged in providing

/ rendering of services and whose investment in equipment

(original cost excluding Land and Bld. and furniture, fittings and

other items not directly related to the service rendered) does not

exceed Rs. 2 crore.

(b) Micro (Service) Enterprises: Enterprises engaged in

providing/rendering of services and whose investment in

equipment (original cost excluding land and building and

furniture, fittings) does not exceed Rs. 10 lakh.

(c) The Small and Micro (service) enterprises shall include small

road & water transport operators, small business, professional &

self-employed persons, and all other service enterprises.

2.1.3 KHADI AND VILLAGE INDUSTRIES SECTOR (KVI)

All advances granted to units in the KVI sector, irrespective of their size of operations, location and amount of original investment in plant and machinery. Such advances will be eligible for consideration under the sub-target (60 per cent) of the small enterprises segment within the priority sector.

Need Based

SMALL

ENTERPRISES

INDIRECT

FINANCE

INDIRECT FINANCE

2.2 Indirect finance to the Small (manufacturing as well as

service) Enterprises sector will include credit to:

2.2.1 Persons involved in assisting the decentralised sector in the

supply of inputs to and marketing of outputs of artisans,

village and cottage industries.

2.2.2 Advances to cooperatives of producers in the decentralised

sector viz. artisans village and cottage industries.

2.2.3 Existing investments as on March 31, 2007, made by banks

in special bonds issued by NABARD with the objective of

Need Based


financing exclusively non-farm sector may be classified as

indirect finance to Small Enterprises sector till the date of

maturity of such bonds or March 31, 2010, whichever is

earlier. Investments in such special bonds made subsequent

to March 31, 2007 will, however, not be eligible for such

classification.

2.2.4 The deposits placed with SIDBI by foreign banks, having

offices in India, on account of non-achievement of priority

sector lending targets/sub-targets till the date of maturity

of such deposits or March 31, 2010, whichever is earlier.

2.2.5 Loans granted by banks to NBFCs for on-lending to small

and micro enterprises (manufacturing as well as service).

Need Based

3 RETAIL TRADE

( Now part of

Small

Enterprises)

3.1 Advances granted to retail traders dealing in essential

commodities (fair price shops), consumer co-operative stores,

and;

3.2 Advances granted to private retail traders with credit limits

not exceeding.

Newly included Service categories are: Consultancy Services

including Management Services; Composite Broker Services in

Risk and Insurance Management; Third Party Administration

(TPA) Services for Medical Insurance Claims of Policy Holders;

Seed Grading Services; Training-cum-Incubator Centre;

Educational Institutions; Training Institutes; Practice of Law;

Trading in medical instruments (brand new);Placement and

Management Consultancy Services; and Advertising agency and

Training centres.

Need based

Rs. 20 lakh.

*

4 MICRO CREDIT 4.1 Loans of very small amount provided by banks either directly

or indirectly through a SHG / JLG mechanism or to NBFC / MFI for

on-lending.

4.2 Loans to poor indebted to informal sector: Loans to

distressed persons (other than farmers) to prepay their debt to

non-institutional lenders, against appropriate collateral or group

security.

Rs 50,000

per

borrower


5 STATE

SPONSORED

ORGANIZATIO

NS FOR SC / ST

Advances sanctioned to State Sponsored Organisations for

Scheduled Castes/ Scheduled Tribes for the specific purpose of

purchase and supply of inputs to and / or the marketing of the

outputs of the beneficiaries of these organisations.

6 EDUCATION

LOANS

6.1 Educational loans granted to individuals. Loans granted to

institutions will not be eligible to be classified as priority sector

advances.

6.2 Loans granted by banks to NBFCs for on-lending to individuals

for educational purposes.

Rs 10 lac

for India &

Rs 20 lac

for abroad.

- Do -

7 HOUSING

LOANS

7.1 Loans irrespective of location, to individuals for purchase /

construction of a dwelling unit per family, excluding loans

granted by banks to their own employees.

7.2 Loans given for repairs to the damaged dwelling units of

families.

7.3 Assistance given to any Govt. agency for construction of

dwelling units or for slum clearance and rehabilitation of slum

dwellers.

7.4 Assistance to Housing Finance Company (HFC) approved by

NHB for the purpose of refinance for on lending to individual for

the purchase / construction per dwelling unit per family. This is

restricted upto 5% of banks total priority sector lending. Loan

granted by banks to HFCs upto 31st March, 2010 will be classified

under priority sector until they are repaid.

Rs 20 lacs.

Rs. 1 lac

(R&SU)

Rs. 2 lac

Urban &

Metro)

Rs. 5 lac per

Dwelling

unit.

Rs. 20 lac

per

Dwelling

unit.

8 EXPORT

CREDIT

This category will form part of priority sector for Foreign Banks

only.

WEAKER SECTION

The Weaker Sections under Priority Sector shall include the following:


Small and Marginal farmers with land holding of 5 acres and less, and landless labourers, tenant farmers and share croppers;

Artisans, Village and Cottage industries with individual credit limits upto Rs. 50,000. Beneficiaries of SGSY; SC / ST, DRI, SJSRY; SRMS, SHGs. Loans to distressed poor to prepay their debt to informal sector, against appropriate

collateral or group security.

COLLATERAL SECURITY NORMS UNDER PRIORITY SECTOR

a) AGRICULTURE No margin & no collateral upto Rs. 1,00,000

b) AGRI-CLINIC & AGRI-BUSINESS No margin & no collateral upto Rs. 5 lac.

c) SMALL ENTERPRISES (SSI)

Normal accounts

Good track record units

A/cs covered under CGTMSE

No Collateral

Upto Rs. 10 lac

Upto Rs. 25 lac

Upto Rs. 1 cr (fund based & non fund based)

d) EDUCATION LOAN No collateral upto Rs. 7.50 lac

NON – RESIDENT INDIAN (NRI) ACCOUNTS

NON - RESIDENT INDIAN: A Person resident outside India who is a citizen of India (holding

Indian Passport), who has gone abroad for gainful employment or business or vocation with

the intentions of staying abroad for indefinite period. Indians who have gone abroad on

temporary foreign assignments and Indian students gone abroad for higher studies are also

treated as NRI.

PERSON OF INDIAN ORIGIN (PIO): PIO means a citizen of any country other than Bangladesh

or Pakistan who had :

a) At any time held Indian passport, or

b) He or either of his parents, or any of his grandparents was a citizen of India by virtue of the

Constitution of India, or the Citizenship Act, 1955, or

c) The person is a spouse of an Indian citizen or a person referred to in (a) or (b). (Foreign

National Spouse of a Non-resident Indian - either NRI or PIO is also given the status of a PIO).

For the purpose of Bank accounts, NRI and PIOs are given equal treatment unless otherwise

specified.

SUMMARY OF BANK ACCOUNTS FOR NON - RESIDENT INDIANS

NON-RESIDENT ORDINARY

A/C (NRO)

NON-RESIDENT

EXTERNAL A/C (NRE)

FOREIGN

CURRENCY NON-

RESIDENT A/C

1 WHO CAN NRI / PIO – other than a NRI / PIO – other than NRI / PIO – other


OPEN A/C person resident in Nepal

and Bhutan. (Individuals of

Bangladesh / Pakistan

nationality require approval

of RBI).

a person resident in

Nepal and Bhutan.

(Individuals of

Bangladesh / Pakistan

nationality require

approval of RBI).

than a person

resident in Nepal

and Bhutan.

(Individuals of

Bangladesh /

Pakistan require

approval of RBI).

2 CURRENCY

OF THE

A/C

Indian Rupee. Indian Rupee Foreign Currency

– USD, GBP, Yen,

Euro, Can $ &

Australian $.

3 SOURCE

OF

FUNDS

Local Funds / Funds from

abroad

Funds from abroad Funds from abroad

4 TYPES OF

ACCOUNT

S

SB / CA / RD / Term

Deposits

SB / CA / RD / Term

Deposits

Only Term

Deposits. RD not

allowed.

5 PERIOD

FOR

TERM

DEPOSIT

As applicable to domestic

Term Deposits (Currently -

Minimum 7 days and

Maximum 10 years)

Minimum -12 months

Maximum - Left to

Banks. (Most Banks -3

years. Above 3 years,

rate of interest

applicable for 3 years

to be given.)

Minimum – 12

months

Maximum – 5

years

6 JOINT A/C

Residents - Permitted

NRI-Permitted

Residents - Not

Permitted

NRI – Permitted

Residents - Not

Permitted

NRI – Permitted

7 NOMINATI

ON

Permitted (NRI or Resident) Permitted (NRI or

Resident)

Permitted (NRI or

Resident)

8 REPATRIA

TION

PRINCIPAL

/ INTEREST

Current Income: Freely

repatriable

Capital Transactions : Non-

repatriable except to the

extent of USD One million

(ceiling) per financial year

Freely Repatriable -

Local current income

can be credited subject

to CA certificate that

amount is eligible for

repatriation and all

Freely Repatriable


on account of sale of house

.

taxes are paid (if NRO

a/c is not maintained).

9 POWER OF

ATTORNEY

a) Permitted in NRO -SB

A/c.

b) Can be a Resident and

undertake all local

transactions and also

repatriation of local current

income to the A/c holder

net of taxes.

a) Permitted in NRE SB

A/c.

b) Can be a Resident

c) # #

1

0

INTEREST

RATE

SAVING

BANK

3.5% 3.5% (linked to

domestic SB rate)

-

TDR

RATE

Banks are free

to fix the

interest.

Ceiling rate linked to

corresponding LIBOR /

Swap.

Currently the ceiling is

LIBOR / SWAP plus 175

basis points.

Fixed or Floating

within ceiling rate

linked to

corresponding

LIBOR / Swap rate.

Currently the

ceiling is LIBOR /

Swap plus 100

basis points.

NON-RESIDENT ORDINARY

A/C (NRO)

NON-RESIDENT

EXTERNAL A/C (NRE)

FOREIGN

CURRENCY NON-

RESIDENT A/C

1

1

TAX

BENEFITS

TDS @ 30% on interest in

SB & TDR. If the customer is

a tax payer abroad and a

Double Tax Avoidance

Treaty (DATT) exists with

the country of Residence of

the NRI, relevant rate can

be applied.

Exempted from all taxes Exempted from all

taxes.

1

2

INVESTME

NT

Amount held in NRO a/c

can be used for Non-

repatriable investment.

Amount held in NRE

accounts can be used

for repatriable

investment.

Proceeds eligible

for repatriable

investment.


1

3

PROCEEDS

OF SALE

OF

RESIDENTI

AL

PROPERTY

a) Allowed through NRO a/c subject to an over-all annual ceiling of USD

One million per financial year (No lock-in period) and on production of an

undertaking by the remitter and a Certificate from a Chartered Accountant

in the formats prescribed.

b) This facility is not available to a citizen of Pakistan, Bangladesh, Sri Lanka,

China, Afghanistan, Iran, Nepal and Bhutan.

c) Repatriation of sale proceeds of residential property purchased by NRI /

PIO out of foreign exchange is restricted to not more than two such

properties.

1

4

NEPAL &

BHUTAN

a) When a person resident in India leaves India for Nepal and Bhutan for an

uncertain period, his existing account will continue as a resident account

and need not be designated as NRO Account.

b) ADs may maintain NRE / FCNR (B) Accounts of persons resident in Nepal

and Bhutan who are citizens of India or of Indian origin, provided the funds

for opening these accounts are remitted in free foreign exchange. Interest

earned in NRE / FCNR (B) accounts can be remitted only in Indian rupees to

NRIs and PIO resident in Nepal and Bhutan.

1

5

NOTE ON

LIBOR

RATE:

FEDAI will publish the LIBOR rates for five maturities in six currencies on the

last working day of each month using a web page that can be accessed by

all the subscribers to the Reuters screen. Banks use these as reference

rates.

LOANS AGAINST DEPOSITS

ACCOUNT HOLDER OR THIRD PARTY

MAXIMUM RS.1 CRORE

NRE /

FCNR

DEPOSIT

S

In

India

1) Personal use / Business activities.

2) Direct investment in India on non-

repatriation basis.

3) Acquisition of flat / house in India

for his own residential use.

Fund based and / or non-fund

based facilities for personal use /

Business activities.

Abroa

d

Fund based and / or non-fund based

facilities for bona fide purposes.

Fund based and / or non-fund

based facilities for bona fide

purposes.

NRO India Personal and / or business Personal and / or business


DEPOSIT

S

requirement. requirement.

Abroa

d

Not available Not available

LOANS

IN

FOREIGN

CURREN

CY

Available in India only to the Account holder against FCNR deposits.

END-USE

RESTRICT

ION

The loans cannot be utilized for the purpose of re-lending, or carrying on

agriculture or plantation activities or for investment in real estate business.

CHANGE

IN

STATUS

In case a Resident who had availed of loan / OD facilities subsequently becomes a

person resident outside India, Banks may at their discretion and commercial

judgment allow continuance of the loan / overdraft facilities. Repayment may be

made by inward remittance or out of legitimate resources in India of the person

concerned.

# # : Can undertake all local payments but repatriation only in favour of the A/c Holder abroad

d) Credit of foreign currency notes and foreign travellers cheques in NRE a/c cannot be

accepted from Power of Attorney holders.

FOREIGN EXCHANGE FACILITIES FOR RESIDENT INDIANS

As per Section 5 of FEMA, resident Indians are permitted to buy or sell foreign exchange from

any APs / FFMC for any Current Account transactions (except for those transactions where

restrictions have been imposed by Central Govt.). Release of Forex beyond these limits will

require prior approval from RBI.

APs can accept payment in cash up to Rs. 50,000 only against sale of foreign exchange as per

FEMA. Wherever the sale of foreign exchange exceeds the amount equivalent to Rs. 50,000,

the payment must be received only by a crossed Cheque / Bankers Cheque / Pay Order / DD

or Credit / Debit / Prepaid cards subject to compliance of KYC norms.

SR PURPOSE AMOUNT IN

USD OR

DETAILS


EQUIVALENT

1. Tourism /

Private visits

to all

countries

except Nepal

and Bhutan,

are eligible.

US $ 10,000

Per Financial year per family member for one or more visits abroad.

Can avail foreign exchange through International credit cards within specified limits.

The limit of USD10,000 per financial year can be availed along with Forex for travel abroad for any purpose, including Employment / Immigration / Education.

2. Employment

Abroad

US $ 1 lakh To Indian resident going abroad for gainful employment.

3. Immigration

Abroad

US $ 1 lakh To meet the incidental expenses in the country of migration. Production of evidence that the traveller has obtained immigration visa is necessary.

4. Education

Abroad

US$ 1 lac Per academic year of the Institute where admission has been obtained.

5. Medical

Treatment

Abroad

US $ 1 lakh Self declaration basis without insisting on any estimate from a hospital/doctor in India/abroad.

FX exceeding the limit of USD 100,000 is subject to the request being supported by an estimate from a hospital/doctor in India / abroad. The USD 1,00,000 is in addition to USD 25,000 eligible for maintenance expenses of the patient or for accompanying as attendant.

6. Maintenance

of close

relative

abroad

US $ 1 lakh Declaration basis.

7. Business Trip US $ 25,000 Available per trip except to Nepal and Bhutan.

Covers visits for International trade conferences, Seminars, Training, Study tours etc also.

8. Small Value

Remittances

US $ 5,000 For any permissible transaction on the basis of simple letter from the applicant without insisting on submission of Form A -2 but based on a declaration in RBI format.

OTHER IMPORTANT ASPECTS:


Utilisation of Forex: The Forex purchased should be utilized within 180 days. If not used, it has to be surrendered to an Authorized Person.

Currency notes / coins up to US $ 3,000: Resident Indians going abroad can avail a maximum of US $ 3,000 in currency notes (cash) and balance in the form of traveller cheques or bank Demand Draft. Exceptions: (a) Iraq and Libya - USD 5,000 or its equivalent;

(b) Iran, Russian Federation and other Republics of CIS - Entire foreign exchange in the

form of foreign currency notes or coins.

Export or Import of Foreign currency: Indian Residents can carry Indian currency notes up to Rs. 7,500 to any country except Nepal & Bhutan. For Nepal & Bhutan there is no restriction on the amount but the denominations of the currency notes should not exceed Rs.100. Similarly, incoming Indians can bring INR currency notes up to Rs.7,500 from any country except Nepal or Bhutan from where the Resident Indian can bring any amount but in denomination not exceeding Rs.100.

Unspent Foreign Exchange: Foreign exchange up to US $ 2,000 in form of foreign currency notes or TCs can be retained by Resident Indians (Optional). The balance (over and above USD 2,000) has to be necessarily surrendered to Authorized Dealer within 180 days, both in case of currency notes and traveller cheques, to be either deposited in a RFC (Domestic) account or converted back into Indian rupees as per the choice of the customer.

Currency Declaration Form (CDF): A person (including a Resident) can bring any amount of Foreign Exchange from abroad, which may be in the form of currency notes or traveler cheques. However, if the amount exceeds US $ 10,000 or its equivalent in TC/Currency and / or the value of foreign currency notes exceeds US $ 5,000 or equivalent in any foreign currency, he / she has to declare his holdings to the Custom authority at the Port / Airport of arrival, in Currency Declaration Form (CDF).

Loans from close Relatives abroad: An Individual resident may borrow a sum not exceeding US $ 2,50,000 or its equivalent from close relatives residing outside India subject to the condition that the minimum maturity period of loan is one year, the loan is free of interest and the amount of loan is received by way of inward remittances in free foreign exchange through normal banking channels or by debit to the NRE / FCNR (B) account of the non-resident lenders.

Export of goods by way of Gifts: The limit for export of goods by way of Gifts is Rs Five lakh per annum.

LIBERALIZED REMITTANCES SCHEME ( LRS) : USD 2,00,000 PER FINANCIAL YEAR

Resident Indian individuals (including minors) are permitted to freely remit up to USD 2,00,000

per financial year for any current or capital account transactions or a combination of both, ( to

acquire and hold immovable property or shares or any other asset outside India) without prior

approval of RBI. Individuals will also be able to open, maintain and hold foreign currency

accounts with a bank outside India for making remittances under this scheme.


LRS facility is in addition to the Remittances allowed as above except in the case of Gifts / Donations. Gifts/Donations are subsumed under LRS.

Should have been a Customer of the bank for a minimum of one year. PAN number is mandatory.

Banks should not extend any kind of credit facilities to resident individuals to facilitate remittances under the Scheme.

For this facility, applicants should designate one branch of one bank. The investor can retain and reinvest the income earned on investments made under the

Scheme. Currently, the residents are not required to repatriate the funds or income generated out of investments made under the Scheme.

Remittances can be consolidated in respect of family members subject to the individual family members complying with the terms & conditions of the Scheme

Facility is available only for Resident individuals & is not to corporates, partnership firms, HUFs, trusts, etc.

This facility is not available for the following: Prohibited purposes such as purchase of Lottery tickets, Sweepstakes, Proscribed (prohibited)magazines etc Remittances either directly or indirectly to Nepal, Bhutan, Pakistan or Mauritius or Countries identified by Financial Action task force. Remittances directly or indirectly to Individuals /entities identified by RBI as posing significant risk of terrorism.

GSS: Scheme details:

DIFFERENTIAL RATE OF

INTEREST (DRI)

PRIME MINISTER EMPLOYMENT GENERATION

PROGRAMME

Launched In 1972 10th October -2008 by merging PMRY and REGP (

Rural Employment Generation Programme )

Main

Objective

To assist poorest of the

poor and to bring them

above the poverty line.

To generate employment opportunities in rural /

urban India through new self-employment

projects / micro enterprises, so as to help arrest

migration of rural youth to urban areas, achieve

higher growth rate of rural and urban

employment.

Applicable All over India. All over India.


Eligibility

Norms

Individuals whose family income not to exceed Rs. 18000/- p.a. in Rural Areas and Rs. 24000/- p.a. in Urban & Semi Urban areas.

Individual whose land holding does not exceed 1 acre of irrigated & 2.5 acres of un-irrigated land.

No ceiling for SC / ST engaged in agriculture & allied activities.

People engaged in Cottage & Rural industries.

Indigent students who don’t get higher studies.

Physically Handicapped persons pursuing for gainful occupation.

State owned corporations / cooperative societies including State corporations / Co-operative societies, Large sized Adivasi Multipurpose Co-Op Societies for Tribal areas.

Any individual, above 18 years of age.

There is no income ceiling for PMEGP.

At least VIII standard pass for : (a) Project cost above Rs.10 lakh for Manufacturing and (b) Project cost above Rs.5 lakh in Business & Service

Self Help groups, Institutions registered under Societies Registration, Act, 1860; Production Co-operative Societies, Charitable Trusts.

PMEGP is meant only for new projects. Existing Units under PMRY, REGP or any other Govt. Scheme not eligible.

Only one person from one family is eligible for obtaining financial assistance for setting up of projects under PMEGP.

The ‘family’ includes self and spouse.

Self Help Groups eligible for assistance under PMEGP include those belonging to BPL provided they have not availed benefits under any other Scheme

Capital Expenditure as T/L. Working Capital as Cash Credit. Composite Loan can also be considered.

Implementing

Agencies

Banks 1) National- KVIC, Mumbai. 2) Rural - KVIC, State

Boards & DIC. 3) Urban- State District Industries

Centres (DICs) only. KVIC and DICs will involve

NSIC, Udyami Mitras empanelled under Rajiv

Gandhi Udyami Mitra Yojana (RGUMY), Panchayati

Raj Institutions and other NGOs of repute in


identification of beneficiaries.

Purpose of

Loan

For productive

activities, pursuing

higher education by

indigent students,

purchase of artificial

limbs etc

To set up micro enterprises in Manufacturing

sector, Business and Services sector.

Quantum of

Loan

Maximum amount Rs.

15,000 as Term loan or

Working Capital or both

for productive purpose.

For Housing maximum

20,000.

Physically handicapped

persons eligible for a

loan of Rs. 5,000/- for

purchase of artificial

limbs / braille

typewriter, in addition

to Rs 15000/- only to SC

/ST.

Manufacturing sector - Rs.25 lakh.

Business sector & Service sector- Rs. 10 lakh.

The balance amount of the total project cost will

be provided by Banks as TL.

Cost of the land should not be included in the

Project cost. Cost of the ready built as well as long

lease or rental Work-shed/Workshop can be

included in the project cost.

Project cost to include Capital Expenditure and one cycle of Working Capital.

Projects without Capital Expenditure are not

eligible for financing under the Scheme. Projects

costing above Rs.5 lakh, with no working capital

requirement, need clearance from the respective

Regional Office of the Bank’s branch.

Target Min 40% to SC / ST

beneficiaries and 2/3rd

to be routed through

rural & semi - urban

branches

----

Classification Weaker Section of

advances under Priority

sectors.

Under Priority Sector

Subsidy Not available General Category : Urban- 15% Rural-25%

Special Category : Urban-25%, Rural-35%


Special Category – SC / ST / OBC / Minorities /

Women, Ex-servicemen, Physically handicapped,

NER, Hill, Border area etc.

Subsidy should be held as a Term Deposit for 3 years.

No interest should be paid on the TDR. No interest on loan on the corresponding amount.

Margin money should be credited to the loan

account after three years from the date of first

disbursement.

Margin NIL General Category -10%, Special Category - 5%.

Margin to be deposited in full after EDP training

with the Bank. Thereafter, the bank will release

first installment of finance to the beneficiary

Interest Rate 4% per annum - Simple

rate of interest.

Normal rate of interest

Security Hypothecation of assets

created out of bank

loan. No collateral

security to be insisted /

accepted.

No collateral security for loans up to Rs. 5 lakh.

Repayment Maximum 5 years

including grace period

upto 2 years depending

upon the type of activity

& income generation.

Between 3 to 7 years after an initial moratorium as

prescribed by bank.

Training: 2-3 weeks EDP is compulsory. Once the

project is sanctioned and before the first

installment of the Bank Finance is released to the

beneficiary, Bank will inform the concerned Nodal

agency, for arranging EDP training.

SWARANJAYANTI

GRAM SWAROJGAR

YOJANA (SGSY)

SELF EMPLOYMENT SCHEME FOR REHABILITATION

OF MANUAL SCAVENGERS' (SRMS)

Launched on 01-04-1999 SRMS has replaced SLRS

Main

Objective

To raise individuals /

groups of rural poor

above poverty line over

Rehabilitating the scavengers and their

dependents by March 2009.


a period of time. The

scheme is funded by

Centre and States in the

ratio of 75:25.

Applicable In Rural Areas Rural and Urban areas

Eligibility

Norms

Rural poor identified through BPL Census duly approved by Gram Sabha. Selection by three members team of BDPO, Banker and Sarpanch which are BPL.

SHG’s consisting 10 to 20 members. In case of disabled beneficiaries, the group may be of 5-20 persons.

Scavengers and their dependents (age 18 years

and above), irrespective of their income, who are

yet to be provided assistance for rehabilitation

under any scheme of the Government of India /

State governments

Implementing

Agencies

DRDA / Financial

Institutions / PRI /

NGO. (Formulated by

Ministry of Rural Devl).

State Channelising Agencies (SCAs). The interest

subsidy will be provided by National Safai

Karmacharis Finance and Development

Corporation (NSKFDC).

Purpose of

Loan

Economically viable and

productive, farm sector

and non-farm sector

activities identified for

each block.

To provide assistance for rehabilitation under any

scheme of the Government of India / State

governments.

Quantum of

Loan

Full amount as per unit cost prescribed by NABARD. Full unit cost to be financed by bank by way of composite loan.

To SHGs Revolving loan of Rs. 25,000/- by bank Amount given to Bank by DRDA Rs. 10,000/-. In

Project Cost upto Rs. 5 lac. Loan = Project Cost –

Capital Subsidy

Both, Term Loan (up to a maximum of Rs. 5 lakh)

and micro financing (up to a maximum of Rs.

25,000) will be admissible under the Scheme.

Micro Financing will also be done through SHGs

and reputed NGOs.


case of successful SHGs, DRDA may consider giving a 2nd dose of subsidy fund upto Rs. 20,000/- inclusive of Rs. 10,000 given earlier.

Target Women - 40%, SC/

ST - 50%, Disabled -

3%. Loan application

disposal - 15 days -

Max. 1 month.

-

Classification To be covered in

weaker section under

priority sector

advances.

To be covered in weaker section under priority

sector advances.

Subsidy Uniform @ 30% of project cost. Maxi Rs 7500/-

SC / STs @ 50%, maxi. Rs 10,000/-

For SHGs @ 50% maxi Rs 1.25 lac.

For PCs up to Rs. 25,000 - 50% of the PC

For PC > Rs. 25,000 - 25% of the PC, with a

minimum of Rs. 12,500 and max. of Rs. 20,000

Margin Subsidy may be treated

as margin money.

No margin money/ promoter’s contribution

Rate of

Interest

As per RBI guidelines

issued from time to

time.

For Projects up to Rs. 25,000 - 5% p.a. & 4% p.a.

for Women beneficiaries.

For Projects above Rs. 25,000 - 6 % p.a

Security For individual loans

upto Rs. 50,000 and

group loans upto Rs. 5

lac, the assets created

out of loan would be

hypothecated as

security. Beyond the

above amount, bank

may take collateral /

third party guarantee.

No collateral security

SHGs may be involved in implementation with in

the overall parameters of the scheme. Since it is a

time bound scheme, norms applicable to the SHGs

under other schemes will not apply.


Repayment Minimum 5 years and

maximum 9 years.

Three years for projects up to Rs. 25,000 and 5

years for projects above Rs. 25,000. Gestation

period is 6 months.

Miscellaneous

For availing group

insurance coverage, the

max. age of swarojgaris

should be 60 years. The

insurance coverage,

however, would be for

5 years or till the loan is

repaid, whichever is

earlier, irrespective of

the age of the

swarojgaris at the time

of sanction of loan.

After disbursing the loan to the beneficiaries the

concerned branch of the bank will claim interest

subsidy from the state channelizing agencies.

IMPORTANT TIPS FOR FACING INTERVIEWS CONFIDENTLY You do need to be aware about your surroundings and this includes some familiarity with current affairs. Banking industry specific questions are common. In addition, there are certain questions you may encounter during the interview, in one for or another. These relate to questions about yourself, what you have been doing and what you want to do in future. In fact, many a times interview starts with personal type questions like “Tell me about yourself” or “your SWOT analysis” etc. It is a good idea to sit for mock interviews with your friends or colleagues. Remember, practice makes man perfect. There is no correct answer as such. What you need to do is to answer these questions calmly. Even during the real interview, you should think before answering the questions. Prepare a diary of probable questions and answers and practice it as many times as you can. You need to pause before answering collect your ideas as it will help you put together all the points, substantiating your response. Though you should not gloss over your weaknesses, you need to focus on your success and your achievements/strengths. You need to convince the interviewer that you are the most suitable person for the higher position.


Everyone is nervous on interviews. If you simply allow yourself to feel nervous, you'll do much better. Remember also that it's difficult for the interviewer as well.

In general, be upbeat and positive. Never be negative.

Rehearse your answers and time them. Try not to talk for more than 2 minutes straight.

Don't try to memorize answers word for word. Use the answers shown here as a guide only, and don't be afraid to include your own thoughts and words. To help you remember key concepts, jot down and review a few key words for each answer. Rehearse your answers frequently, and they will come to you naturally in interviews.

Find out what people want, than show them how you can help them get it.

You must match your abilities, with the needs of the employer. You must sell what the buyer is buying. To do that, before you know what to emphasize in your answers, you must find out what the buyer is buying... what he is looking for. And the best way to do that is to ask a few questions yourself.

You will see how to bring this off skillfully as you read the first two questions of this report. But regardless of how you accomplish it, you must remember this strategy above all: before blurting out your qualifications, you must get some idea of what the employer wants most. Once you know what he wants, you can then present your qualifications as the perfect “key” that fits the “lock” of that position.

Other important interview strategies:

Turn weaknesses into strengths (You'll see how to do this in a few moments.)

Think before you answer. A pause to collect your thoughts is a hallmark of a thoughtful person.

As a daily exercise, practice being more optimistic. For example, try putting a positive spin on events and situations you would normally regard as negative. This is not meant to turn you into a Pollyanna, but to sharpen your selling skills. The best salespeople, as well as the best liked interview candidates, come off as being naturally optimistic, "can do" people. You will dramatically raise your level of attractiveness by daily practicing to be more optimistic.

Be honest...never lie.

You might feel that the answers to the following questions are “canned”, and that they will seldom match up with the exact way you are asked the questions in actual interviews. The questions and answers are designed to be as specific and realistic as possible. But no preparation can anticipate thousands of possible variations on these questions. What's important is that you thoroughly familiarize yourself with the main strategies behind each


answer. And it will be invaluable to you if you commit to memory a few key words that let you instantly call to mind your best answer to the various questions. If you do this, and follow the principles of successful interviewing presented here, you're going to do very well.

Question 1 Tell me about yourself.

TRAPS: Beware; about 80% of all interviews begin with this “innocent” question. Many candidates, unprepared for the question, skewer themselves by rambling, recapping their life story, delving into ancient work history or personal matters.

BEST ANSWER: Start with the present and tell why you are well qualified for the position. Remember that the key to all successful interviewing is to match your qualifications to what the interviewer is looking for. In other words you must sell what the buyer is buying.

So, before you answer this or any question it's imperative that you try to uncover your interviewer's greatest need, want, problem or goal.

Question 2 What are your greatest strengths?

TRAPS: This question seems like a softball lob, but be prepared. You don't want to come across as egotistical or arrogant. Neither is this a time to be humble.

BEST ANSWER: You know that your key strategy is to first uncover your interviewer's greatest wants and needs before you answer questions. And from Question 1, you know how to do this.

Prior to any interview, you should have a list mentally prepared of your greatest strengths. You should also have, a specific example or two, which illustrates each strength, an example chosen from your most recent and most impressive achievements.

You should, have this list of your greatest strengths and corresponding examples from your achievements so well committed to memory that you can recite them cold after being shaken awake at 04.00 AM.

Then, once you uncover your interviewer's greatest wants and needs, you can choose those achievements from your list that best match up.

As a general guideline, the 10 most desirable traits that all employers love to see in their employees are:

1. A proven track record as an achiever...especially if your achievements match up with the employer's greatest wants and needs. 2. Intelligence...management "savvy". 3. Honesty...integrity...a decent human being.


4. Good fit with corporate culture...someone to feel comfortable with...a team player who meshes well with interviewer's team. 5. Likeability...positive attitude...sense of humor. 6. Good communication skills. 7. Dedication...willingness to walk the extra mile to achieve excellence. 8. Definiteness of purpose...clear goals. 9. Enthusiasm...high level of motivation. 10. Confident...healthy...a leader.

Question 3 What are your greatest weaknesses?

TRAPS: Beware - this is an eliminator question, designed to shorten the candidate list. Any admission of a weakness or fault will earn you an “A” for honesty, but an “F” for the interview.

PASSABLE ANSWER: Disguise a strength as a weakness.

Example: “I sometimes push my people too hard. I like to work with a sense of urgency and everyone is not always on the same wavelength.”

Drawback: This strategy is better than admitting a flaw, but it's so widely used, it is transparent to any experienced interviewer.

BEST ANSWER: (and another reason it's so important to get a thorough description of your interviewer's needs before you answer questions): Assure the interviewer that you can think of nothing that would stand in the way of your performing in this position with excellence. Then, quickly review you strongest qualifications.

Example: “Nobody's perfect, but based on what you've told me about this position, I believe I' d make an outstanding match.

Alternate strategy (if you don't yet know enough about the position to talk about such a perfect fit): Instead of confessing a weakness, describe what you like most and like least, making sure that what you like most matches up with the most important qualification for success in the position, and what you like least is not essential.

Question 4 Tell me about something you did – or failed to do – that you now feel a

little ashamed of.

TRAPS: There are some questions your interviewer has no business asking, and this is one. But while you may feel like answering, “none of your business,” naturally you can’t. Some interviewers ask this question on the chance you admit to something, but if not, at least they’ll see how you think on your feet.


Some unprepared candidates, flustered by this question, unburden themselves of guilt from their personal life or career, perhaps expressing regrets regarding a parent, spouse, child, etc. All such answers can be disastrous.

BEST ANSWER: As with faults and weaknesses, never confess a regret. But don’t seem as if you’re stonewalling either.

Best strategy: Say you harbor no regrets, then add a principle or habit you practice regularly for healthy human relations.

Question 5 The “Silent Treatment”

TRAPS: Beware – if you are unprepared for this question, you will probably not handle it right and possibly blow the interview. Thank goodness most interviewers don’t employ it. It’s normally used by those determined to see how you respond under stress. Here’s how it works:

You answer an interviewer’s question and then, instead of asking another, he just stares at you in a deafening silence.

You wait, growing a bit uneasy, and there he sits, silent as Mt. Everest, as if he doesn’t believe what you’ve just said, or perhaps making you feel that you’ve unwittingly violated some cardinal rule of interview etiquette.

When you get this silent treatment after answering a particularly difficult question, such as “tell me about your weaknesses”, its intimidating effect can be most disquieting, even to polished job hunters.

Most unprepared candidates rush in to fill the void of silence, viewing prolonged, uncomfortable silences as an invitation to clear up the previous answer which has obviously caused some problem. And that’s what they do – ramble on, sputtering more and more information, sometimes irrelevant and often damaging, because they are suddenly playing the role of someone who’s goofed and is now trying to recoup. But since the candidate doesn’t know where or how he goofed, he just keeps talking, showing how flustered and confused he is by the interviewer’s unmovable silence.

BEST ANSWER: Like a primitive tribal mask, the Silent Treatment loses all it power to frighten you once you refuse to be intimidated. If your interviewer pulls it, keep quiet yourself for a while and then ask, with sincere politeness and not a trace of sarcasm, “Is there anything else I can fill in on that point?” That’s all there is to it.

Whatever you do, don’t let the Silent Treatment intimidate you into talking a blue streak, because you could easily talk yourself out of the position.


Question 7 Aren’t you overqualified for this position?

TRAPS: The employer may be concerned that you’ll grow dissatisfied and leave.

BEST ANSWER: As with any objection, don’t view this as a sign of imminent defeat. It’s an invitation to teach the interviewer a new way to think about this situation, seeing advantages instead of drawbacks.

“I could help you in many things they don’t teach at the Harvard Business School. For example…(how to hire, train, motivate, etc.) When it comes to knowing how to work well with people and getting the most out of them, there’s just no substitute for what you learn over many years of front-line experience. Organisation will gain all this.”

NOTE: The main concern behind the “overqualified” question is that you will leave your new employer as soon as something better comes your way. Anything you can say to demonstrate the sincerity of your commitment to the employer and reassure him that you’re looking to stay for the long-term will help you overcome this objection.

Question 8 Where do you see yourself five years from now?

TRAPS: One reason interviewers ask this question is to see if you’re settling for this position, using it merely as a stopover until something better comes along. Or they could be trying to gauge your level of ambition.

If you’re too specific, i.e., naming the promotions you someday hope to win, you’ll sound presumptuous. If you’re too vague, you’ll seem rudderless.

BEST ANSWER: Reassure your interviewer that you’re looking to make a long-term commitment…that this position entails exactly what you’re looking to do and what you do extremely well. As for your future, you believe that if you perform each job at hand with excellence, future opportunities will take care of themselves.

Example: “I am definitely interested in making a long-term commitment to my next position. Judging by what you’ve told me about this position, it’s exactly what I’m looking for and what I am very well qualified to do. In terms of my future career path, I’m confident that if I do my work with excellence, opportunities will inevitable open up for me. It’s always been that way in my career, and I’m confident I’ll have similar opportunities here.”


Question 9 Describe your ideal Bank/organisation, location and Position.

TRAPS: This is often asked by an experienced interviewer who thinks you may be overqualified, but knows better than to show his hand by posing his objection directly. So he’ll use this question instead, which often gets a candidate to reveal that, indeed, he or she is looking for something other than the position at hand.

BEST ANSWER: The only right answer is to describe what this organisation is offering, being sure to make your answer believable with specific reasons, stated with sincerity, why each quality represented by this opportunity is attractive to you.

Question 10 What are your career options right now?

TRAPS: The interviewer is trying to find out, “How desperate are you?”

BEST ANSWER: Prepare for this question by thinking of how you can position yourself as a desired commodity.

Question 11 Tell me honestly about the strong points and weak points of your boss

(company, management team, etc.)…

TRAPS: Skillful interviewers sometimes make it almost irresistible to open up and air a little dirty laundry from your previous position. DON’T

BEST ANSWER: Remember the rule: Never be negative. Stress only the good points, no matter how charmingly you’re invited to be critical.

Question 12 What good books have you read lately?

TRAPS: As in all matters of your interview, never fake familiarity you don’t have. Yet you don’t want to seem like a dullard who hasn’t read a book since long.

BEST ANSWER: Unless you’re up for a position in academia or as book critic for The Times of India, you’re not expected to be a literary lion. But it wouldn’t hurt to have read a handful of the most recent and influential books in your profession and on management.

Consider it part of the work of your promotion exercise to read up on a few of these leading books. But make sure they are quality books that reflect favorably upon you, nothing that could even remotely be considered superficial. Finally, add a recently published best-selling work of fiction by a world-class author and you’ll pass this question with flying colors.


Question 13 Tell me about a situation when your work was criticized.

TRAPS: This is a tough question because it’s a more clever and subtle way to get you to admit to a weakness. You can’t dodge it by pretending you’ve never been criticized. Everybody has been. Yet it can be quite damaging to start admitting potential faults and failures that you’d just as soon leave buried.

This question is also intended to probe how well you accept criticism and direction.

BEST ANSWERS: Begin by emphasizing the extremely positive feedback you’ve gotten throughout your career and (if it’s true) that your performance reviews have been uniformly excellent.

Of course, no one is perfect and you always welcome suggestions on how to improve your performance. Then, give an example of a not-too-damaging learning experience from early in your career and relate the ways this lesson has since helped you. This demonstrates that you learned from the experience and the lesson is now one of the strongest breastplates in your suit of armor.

If you are pressed for a criticism from a recent position, choose something fairly trivial that in no way is essential to your successful performance. Add that you’ve learned from this, too, and over the past several years/months, it’s no longer an area of concern because you now make it a regular practice to…etc.

Another way to answer this question would be to describe your intention to broaden your master of an area of growing importance in your field.

Again, the key is to focus on something not essential to your brilliant performance but which adds yet another dimension to your already impressive knowledge base.

Question 14 What are your outside interests?

TRAPS: You want to be a well-rounded, not a drone. But your employer would be even more turned off if he suspects that your heavy extracurricular load will interfere with your commitment to your work duties.

BEST ANSWERS: Try to gauge how this organization’s culture would look upon your favorite outside activities and be guided accordingly.

You can also use this question to shatter any stereotypes that could limit your chances. If you’re over 50, for example, describe your activities that demonstrate physical stamina. If you’re young, mention an activity that connotes wisdom and institutional trust, such as serving on the board of a popular charity.


But above all, remember that your organisation is going to promote you for what you can do for the organisation, not your family, yourself or outside organizations, no matter how admirable those activities may be.

Question 15 How do you feel about reporting to a younger person (minority, woman,

etc)?

TRAPS: It’s a shame that some interviewers feel the need to ask this question, but many understand the reality that prejudices still exist among some aspirants, and it’s better to try to flush them out beforehand.

The trap here is that in today’s politically sensitized environment, even a well-intentioned answer can result in planting your foot neatly in your mouth. Avoid anything which smacks of a patronizing or an insensitive attitude, such as “I think they make terrific bosses” or “Hey, some of my best friends are…”

Of course, since almost anyone with an IQ above room temperature will at least try to steadfastly affirm the right answer here, your interviewer will be judging your sincerity most of all. “Do you really feel that way?” is what he or she will be wondering.

So you must make your answer believable and not just automatic.

BEST ANSWER: You greatly admire an organisation that hires and promotes on merit alone and you couldn’t agree more with that philosophy. The age (gender, race, etc.) of the person you report to would certainly make no difference to you.

Whoever has that position has obviously earned it and knows their job well. Both the person and the position are fully deserving of respect. You believe that all people in an organisation, from the messenger to the Chairman, work best when their abilities, efforts and feelings are respected and rewarded fairly, and that includes you. That’s the best type of work environment you can hope to find.

Question 16 Would you lie for the Bank/organisation?

TRAPS: This is another question that pits two values against one another, in this case loyalty against integrity.

BEST ANSWER: Try to avoid choosing between two values, giving a positive statement, which covers all bases instead.

Example: “I would never do anything to hurt the company..”

If aggressively pressed to choose between two competing values, always choose personal integrity. It is the most prized of all values.


Question 17 Looking back, what would you do differently in your life?

TRAPS: This question is usually asked to uncover any life-influencing mistakes; regrets, disappointments or problems that may continue to affect your personality and performance.

You do not want to give the interviewer anything negative to remember you by, such as some great personal or career disappointment, even long ago that you wish could have been avoided.

Nor do you wish to give any answer, which may hint that your whole heart and soul will not be in your work.

BEST ANSWER: Indicate that you are a happy, fulfilled, optimistic person and that, in general, you wouldn’t change a thing.

Question 18 Could you have done better in your last Assignment ?

TRAPS: This is no time for true confessions of major or even minor problems.

BEST ANSWER: Again never be negative.

Example: “I suppose with the benefit of hindsight you can always find things to do better, of course, but off the top of my head, I can’t think of anything of major consequence.”

(If more explanation seems necessary) Describer a situation that didn’t suffer because of you but from external conditions beyond your control.

Question 19 Can you work under pressure?

TRAPS: An easy question, but you want to make your answer believable.

BEST ANSWER: Absolutely…(then prove it with a vivid example or two of a goal or project accomplished under severe pressure.)

Question 20 What makes you angry?

TRAPS: You don’t want to come across either as a hothead or a wimp.

BEST ANSWER: Give an answer that’s suited to both your personality and the management style of the organisation. Here, the homework you’ve done about the organisation and its style can help in your choice of words.


Examples: If you are a reserved person and/or the organizations culture is coolly professional:

“I’m an even-tempered and positive person by nature, and I believe this helps me a great deal in keeping my department running smoothly, harmoniously and with a genuine esprit de corps. I believe in communicating clearly what’s expected, getting people’s commitment to those goals, and then following up continuously to check progress.”

Question 21 Why aren’t you earning more money at this stage of your career?

TRAPS: You don’t want to give the impression that money is not important to you, yet you want to explain the concept of Total Compensation.

BEST ANSWER: You like to make money, but other factors are even more and equally important.

Example: “Making money is very important to me, and one reason I’m here is because I’m looking to make more. Throughout my career, what’s been even more important to me is doing work I really like to do at the kind of organisation I like and respect.

Question 22 Who has inspired you in your life and why?

TRAPS: The two traps here are unprepared ness and irrelevance. If you grope for an answer, it seems you’ve never been inspired. If you ramble about your high school basketball coach, you’ve wasted an opportunity to present qualities of great value to the company.

BEST ANSWER: Have a few heroes in mind, from your mental “Board of Directors” – Leaders in your industry, from history or anyone else who has been your mentor.

Be prepared to give examples of how their words, actions or teachings have helped inspire your achievements. As always, prepare an answer which highlights qualities that would be highly valuable in the position you are seeking.


Question 23 What was the toughest decision you ever had to make?

TRAPS: Giving an unprepared or irrelevant answer.

BEST ANSWER: Be prepared with a good example, explaining why the decision was difficult…the process you followed in reaching it…the courageous or effective way you carried it out…and the beneficial results.

Question 25 Tell me about the most boring assignment you’ve ever had.

TRAPS: You give a very memorable description of a very boring assignment. Result? You become associated with this boring assignment in the interviewer’s mind.

BEST ANSWER: You have never allowed yourself to grow bored with a job and you can’t understand it when others let themselves fall into that rut.

Example: “Perhaps I’ve been fortunate, but that I’ve never found myself bored with any assignment I have ever held. I’ve always enjoyed hard work. As with actors who feel there are no small parts, I also believe that in every company or department there are exciting challenges and intriguing problems crying out for energetic and enthusiastic solutions. If you’re bored, it’s probably because you’re not challenging yourself to tackle those problems right under your nose.”

Question 26 How do you feel about working nights and weekends?

TRAPS: Blurt out “no way” and you can kiss the offer goodbye. But what if you have a family and want to work a reasonably normal schedule? Is there a way to get work life balance?

BEST ANSWER: First, if you’re a confirmed workaholic, this question is a softball lob. Whack it out of the park on the first swing by saying this kind of schedule is just your style. Add that your family understands it. Indeed, they’re happy for you, as they know you get your greatest satisfaction from your work.

If however, you prefer a more balanced lifestyle, answer this question with another: “will maintain work life balance?”

Example: I do have a family who likes to see me after work and on weekends. They add balance and richness to my life, which in turn helps me be happy and productive at work. If I could handle some of the extra work at home in the evenings or on weekends, that would be ideal.


Question 27 Are you willing to relocate or travel?

TRAPS: Answer with a flat “no” and you may slam the door shut on this opportunity. But what if you’d really prefer not to relocate or travel, yet wouldn’t want to lose the opportunity?

BEST ANSWER: First find out where you may have to relocate and how much travel may be involved. Then respond to the question.

If there’s no problem, say so enthusiastically.

If you do have a reservation, there are two schools of thought on how to handle it.

One advises you to keep your options open and your reservations to yourself in the early going, by saying, “no problem”. You strategy here is to get the best offer you can, then make a judgment whether it’s worth it to you to relocate or travel.

Also, by the time the offer comes through, you may have other offers and can make a more informed decision. Why kill of this opportunity before it has chance to blossom into something really special?

The second way to handle this question is to voice a reservation, but assert that you’d be open to relocating (or traveling) for the right opportunity or after some time/specific event.

The answering strategy you choose depends on how eager you are for the position. If you want to take no chances, choose the first approach.

Question 28 What would you say to boss if he’s crazy about an idea, but you think it

stinks?

TRAPS: This is another question that pits two values, in this case loyalty and honesty, against one another.

BEST ANSWER: Remember the rule stated earlier: In any conflict between values, always choose integrity.

Question 29 How could you have improved your career progress?

TRAPS: This is another variation on the question, “If you could, how would you live your life?” Remember, you’re not going to fall for any such invitations to rewrite person history. You can’t win if you do.

BEST ANSWER: You’re generally quite happy with your career progress.


But all things considered, you take responsibility for where you are, how you’ve gotten there, where you are going…and you harbor no regrets.

Question 30 Give me an example of your creativity (analytical skill…managing ability,

etc.)

TRAPS: The worst offense here is simply being unprepared. Your hesitation may seem as if you’re having a hard time remembering the last time you were creative, analytical, etc.

BEST ANSWER: Remember from Question 2 that you should commit to memory a list of your greatest and most recent achievements, ever ready on the tip of your tongue.

If you have such a list, it’s easy to present any of your achievements in light of the quality the interviewer is asking about.

Question 31 Where could you use some improvement?

TRAPS: Another tricky way to get you to admit weaknesses. Don’t fall for it.

BEST ANSWER: Keep this answer, like all your answers, positive. A good way to answer this question is to identify a cutting-edge branch of your profession (one that’s not essential to your employer’s needs) as an area you’re very excited about and want to explore more fully over the next six months.

Question 32 What do you worry about?

TRAPS: Admit to worrying and you could sound like a loser. Saying you never worry doesn’t sound credible.

BEST ANSWER: Redefine the word ‘worry’ so that it does not reflect negatively on you.

Example: “I wouldn’t call it worry, but I am a strongly goal-oriented person. So I keep turning over in my mind anything that seems to be keeping me from achieving those goals, until I find a solution. That’s part of my tenacity, I suppose.”

Question 33 How many hours a week do you normally work?

TRAPS: You don’t want to give a specific number. Make it to low, and you may not measure up. Too high, and you’ll forever feel guilty about sneaking out the door at 5:15.

BEST ANSWER: If you are in fact a workaholic and you sense your organisation would like that: Say you are a confirmed workaholic, that you often work nights and weekends. Your family accepts this because it makes you fulfilled.


If you are not a workaholic: Say you have always worked hard and put in long hours. It goes with the territory. It one sense, it’s hard to keep track of the hours because your work is a labor of love, you enjoy nothing more than solving problems. So you’re almost always thinking about your work, including times when you’re home, while shaving in the morning, while commuting, etc.

Question 34 The “Hypothetical Problem”

TRAPS: Sometimes an interviewer will describe a difficult situation and ask, “How would you handle this?” Since it is virtually impossible to have all the facts in front of you from such a short presentation, don’t fall into the trap of trying to solve this problem and giving your verdict on the spot. It will make your decision-making process seem woefully inadequate.

BEST ANSWER: Instead, describe the rational, methodical process you would follow in analyzing this problem, who you would consult with, generating possible solutions, choosing the best course of action, and monitoring the results.

Remember, in all such, “What would you do?” questions, always describe your process or working methods, and you’ll never go wrong.

Question 35 What was the toughest challenge you’ve ever faced?

TRAPS: Being unprepared or citing an example from so early in your life that it doesn’t score many points for you at this stage of your career.

BEST ANSWER: This is an easy question if you’re prepared. Have a recent example ready that demonstrates either:

1. A quality most important to the job at hand; or 2. A quality that is always in demand, such as leadership, initiative, managerial skill, persuasiveness, courage, persistence, intelligence, etc.

Question 36 What are your goals?

TRAPS: Not having any…or having only vague generalities, not highly specific goals.

BEST ANSWER: If you’re vague about your career and personal goals, it could be a big turnoff to many people.

Be ready to discuss your goals for each major area of your life: career, personal development and learning, family, physical (health), community service and (if your interviewer is clearly a religious person) you could briefly and generally allude to your


spiritual goals (showing you are a well-rounded individual with your values in the right order).

Be prepared to describe each goal in terms of specific milestones you wish to accomplish along the way, time periods you’re allotting for accomplishment, why the goal is important to you, and the specific steps you’re taking to bring it about. But do this concisely, as you never want to talk more than two minutes straight before letting your interviewer back into the conversation.

Question 37 The Illegal Question

TRAPS: Illegal questions include any regarding your age…number and ages of your children or other dependents…marital status…maiden name…religion…political affiliation…ancestry…national origin…birthplace…naturalization of your parents, spouse or children…diseases…disabilities…clubs…or spouse’s occupation…unless any of the above are directly related to your performance of the job. You can’t even be asked about arrests, though you can be asked about convictions.

BEST ANSWER: You can handle an illegal question in several ways. First, you can assert your legal right not to answer. But this will frighten or embarrass your interviewer and destroy any rapport you had.

Second, you could swallow your concerns over privacy and answer the question straight forwardly if you feel the answer could help you. For example, your interviewer, a devout Baptist, recognizes you from church and mentions it. Here, you could gain by talking about your church.

Third, if you don’t want your privacy invaded, you can diplomatically answer the concern behind the question without answering the question itself.

Example: If you are over 50 and are asked, “How old are you?” you can answer with a friendly, smiling question of your own on whether there’s a concern that your age my affect your performance. Follow this up by reassuring the interviewer that there’s nothing in this job you can’t do and, in fact, your age and experience are the most important advantages you offer the organisation for the following reasons…(give some examples)

Another example: If asked, “Do you plan to have children?” you could answer, “I am wholeheartedly dedicated to my career“, perhaps adding, “I have no plans regarding children.” (You needn’t fear you’ve pledged eternal childlessness. You have every right to change your plans later. Get the oppertunity first and then enjoy all your options.)


Most importantly, remember that illegal questions arise from fear that you won’t perform well. The best answer of all is to get the oppertunity and perform brilliantly. All concerns and fears will then varnish, replaced by respect and appreciation for your work.

Question 38 The “Secret” Illegal Question

TRAPS: Much more frequent than the Illegal question (see Question 55) is the secret illegal question. It’s secret because it’s asked only in the interviewer’s mind. Since it’s not even expressed to you, you have no way to respond to it, and it can there be most damaging.

BEST ANSWER: Remember that just because the interviewer doesn’t ask an illegal question doesn’t mean he doesn’t have it. More than likely, he is going to come up with his own answer. So you might as well help him out.

How? Well, you obviously can’t respond to an illegal question if he hasn’t even asked. This may well offend him. And there’s always the chance he wasn’t even concerned about the issue until you brought it up, and only then begins to wonder.

So you can’t address “secret” illegal questions head-on. But what you can do is make sure there’s enough counterbalancing information to more than reassure him that there’s no problem in the area he may be doubtful about.

Question 39 How do you define success…and how do you measure up to your own

definition?

TRAPS: Seems like an obvious enough questions. Yet many aspirants, unprepared for it, fumble the ball.

BEST ANSWER: Give a well-accepted definition of success that leads right into your own stellar collection of achievements.

Example: “The best definition I’ve come across is that success is the progressive realization of a worthy goal.”

“As to how I would measure up to that definition, I would consider myself both successful and fortunate…”(Then summarize your career goals and how your achievements have indeed represented a progressive path toward realization of your goals.)


Question 40 “The Opinion Question” – What do you think about …Abortion…The

President…The Death Penalty… Women Reservation Bill ……………(or any other

controversial subject)?

TRAPS: If you give your opinion and it’s the opposite of the interviewer, you won’t change his opinions, but you could easily lose the opportunity.

BEST ANSWER: Handle it diplomatically.

Question 41 Looking back on your last position, have you done your best work?

TRAPS: Tricky question. Answer “absolutely” and it can seem like your best work is behind you. Answer, “no, my best work is ahead of me,” and it can seem as if you didn’t give it your all.

BEST ANSWER: To cover both possible paths this question can take, your answer should state that you always try to do your best, and the best of your career is right now. Like an athlete at the top of his game, you are just hitting your career stride thanks to several factors. Then, recap those factors, highlighting your strongest qualifications.

Question 42 Tell me something negative you’ve heard about our Bank

TRAPS: This is a common fishing expedition to see what the industry grapevine may be saying about the organisation.

BEST ANSWER: Just remember the rule – never be negative – and you’ll handle this one just fine.

Question 42 On a scale of one to ten, rate me as an interviewer.

TRAPS: Give a perfect “10,” and you’ll seem too easy to please. Give anything less than a perfect 10, and he could press you as to where you’re being critical, and that road leads downhill for you.

BEST ANSWER: Once again, never be negative. The interviewer will only resent criticism coming from you. This is the time to show your positivism.

However, don’t give a numerical rating. Simply praise whatever interview style he’s been using.

If he’s been tough, say “You have been thorough and tough-minded, the very qualities needed to conduct a good interview.”


If he’s been methodical, say, “You have been very methodical and analytical, and I’m sure that approach results in excellent hires for your firm.”

In other words, pay him a sincere compliment that he can believe because it’s anchored in the behavior you’ve just seen.

SOURCE: Newspaper such as The Economic Times, Business Standard, Business Line, The Chartered Accountant World, NSE / SEBI Web sites, Magazines, Books published by different units & institutions, Books Published by SBLCs and ATIs, RBI / IBA guidelines and the World Wide Web.

DISCLAIMER: This is a voluntary effort. All the sections / data/ INFORMATION are based on press reports, journals, news clippings, web sites and no responsibility is accepted for the accuracy of facts and figures contained in them. The opinion expressed is of the author and not of the Bank. Regarding products/Circular instructions it is requested to refer to the original circular for any clarification & act as per original circular. While we have taken every care to provide correct and latest information; we believe to be accurate and reliable, errors and omissions are likely. However we do not assume responsibility of any kind nor shall be liable for losses and consequences arising from uses thereof. Hence Readers are requested to be guided by the circulars issued by the Bank from time to time and the Author and SBLC Patna , is not liable for any such inadvertent and omissions, if any. We also request our esteemed readers to kindly bring to our notice , any mistake , omissions noticed by them to make suitable corrections in subsequent materials.

I place on record my special gratitude to HR Deptt., LHO Patna, Team SBLC, Patna, all the ATIs , SBLCs, SB Times , other Financial & promotion magazines , News papers and staff from different corner of the Bank whose publication , articles, reading material have been utilized by me as a valuable resource for this compilation. With Best Wishes,

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