The Directors have great pleasure in presenting before you the Annual
Report of the Bank along with the audited Balance Sheet, Profit ACY- Loss
Account and the Report on Business and Operations for the year ended
March 31, 2014.
2. PERFORMANCE OF YOUR BANK 2013-14
Total business of your Bank stood at X 2,07,172 crore as on 31.03.2014,
as compared to X 1,70,734 crore a year ago, registering a year-on-year
growth of 21.34 per cent.
Total deposits of the Bank stood at X 1,16,803 crore, up by 23.8 per
cent over the level of X 94,337 crore as at the end of March 2014.
Current ACY- Savings Bank (CASA) deposits increased to X 41,921 crore as
on 31.03.2014. Share of CASA deposits in total deposits of your Bank
stood at 35.89 per cent as on 31.03.2014 which is one of the highest
among Public Sector Banks.
2.3 Credit Deployment
The Bank has put in place a lending policy in conformity with the
guidelines issued by RBI and also the lending norms of the Government
of India. It emphasizes on qualitative credit growth and ensures
compliance with regulatory requirements as well as the prudential
Gross advances of the Bank increased from X 76,397 crore as on
31.3.2013 to X 90,369 crore as on 31.3.2014 with growth of 18.29 per
cent. Efficient service with customer centric approach has enabled the
bank in registering growth, in-line with the banking industry during
the year 2013-14.
Several steps have been taken for improving credit delivery mechanism
along with improvement in turnaround without compromising the overall
quality of credit.
Mid Corporate shall continue to be one of the thrust areas for the bank
in future for increasing yield on advances and dispersion of credit
Efforts are continued to improve portfolio yield by reshuffling the
2.3.1 Sectoral Deployment of Credit
While financing to various segments of the economy, the Bank has
endeavored to maintain a diversified credit portfolio, with a view to
ensuring credit dispersion across sectors. The Bank has continued its
efforts to support core, manufacturing and priority sectors as well as
infrastructure projects, which serve to drive economic growth. This
focus of the Bank will continue in future, in line with the national
economic growth priorities.
Industry wise credit deployment as on 31.03.2014 is as under.
Outsta- tage to Outsta- tage to
Sr nding nding
No. Credit deployed as on total as on total
X in crore outsta- X in crore outsta-
1 Industry 48889.64 54.10 ACU- 41307.25 54.49 ACU-
i. Infrastructure 13004.99 14.39 ACU- 12223.59 16.13 ACU-
ii. Chemicals, Dyes, 1578.92 1.75 ACU- 1387.15 1.83 ACU-
iii.Petroleum 2270.61 2.51 ACU- 1552.71 2.05 ACU-
iv. Iron ACY- Steel 2689.22 2.98 ACU- 1640.21 2.16 ACU-
v. NBFCs ACY- Trading 15111.27 16.72 ACU- 12671.06 16.72 ACU-
vi. Engineering 2946.42 3.26 ACU- 2496.14 3.29 ACU-
vii.Construction 387.52 0.43 ACU- 318.29 0.42 ACU-
viii. Other Industries 10900.69 12.06 ACU- 9018.1 11.90 ACU-
2 Agriculture 10276.07 11.37 ACU- 7378.35 9.73 ACU-
3 MSME 19062.99 21.09 ACU- 16788.21 22.15 ACU-
4 Housing 8854.16 9.80 ACU- 6578.23 8.68 ACU-
5 Education 622.71 0.69 ACU- 551.59 0.73 ACU-
6 Exports 1880.71 2.08 ACU- 1886.06 2.49 ACU-
7 Commercial Real
estate 4793.96 5.30 ACU- 3551.63 4.69 ACU-
2.3.2 Credit Administration and Monitoring
Early warning signals are captured from the CBS system on daily basis
for close monitoring of stressed accounts on near real time basis.
System generated SMS alerts are sent to the customers to pre-empt
delinquency. An integrated web-based reporting has been introduced in
the Bank to enable instant communication between branches/Zones/Head
Office for effective monitoring of credit portfolio.
The credit quality of borrowal accounts is further monitored through
periodical asset performance review, credit audits ACY- stock audits.
Timely rescheduling of repayment terms is undertaken in deserving
2.4 Asset Performance
During the Financial Year (FY) 2013-14, total cash recovery in NPAs was
X 706.41 crore (last year X 411.22 crore). Of this. recovery in Ledger
balance was X 646.46 crore (X 198.73 crore), including recovery in sale
of Assets X 242.16 crore (NIL), recovery in written off accounts was X
303.32 crore (X 156.76 crore) and recovery in cases of unapplied
interest was X 38.22 crore (X 55.73 crore). This was besides up
gradation of NPAs to the tune of X 101.39 crore (X 105.19 crore). This
year''s achievement was possible due to intensive follow up adopted by
the Branches with the defaulting borrowers through letters, notices,
recovery camps, Lok Adalatas, actions under SARFAESI and through DRTs.
To address and improve recovery in small sized NPAs having ledger
balances upto X 10.00 lakh, the bank established additional 5 Micro
Asset Recovery Cells (MARC) at Zonal offices thereby making total 39
MARCs. The recovery performance through this vertical was encouraging
with MARCs recovering X 376.66 crore (X 210.53 crore). The share of
recovery of MARCs in total cash recovery of the bank was 54.05 ACU-
The bank continued during this FY a special ''One Time Settlement''(OTS)
scheme and also launched special OTS product (M-zero) for recovery in
NPA accounts having ledger balance up to X 5.00 lakh. The total
recovery in NPAs under this scheme was X 50.15 crore as against X 38.40
crore in the previous year.
The Gross NPA ratio of the bank stood at 3.16 ACU- during the financial
year from 1.49 ACU- as of 31.03.2013. Similarly the ratio of Net NPAs stood
at 2.03 ACU- as on 31.03.2014 as against 0.52 ACU- a year ago. The NPA
ratios of the Bank are much better than not only of the peer Banks but
also of many large Banks.
2.5 Foreign Exchange Business and Export Finance
During the year 2013-14, the Bank has achieved merchant turnover of X
28,370 Crores (X 30,437 Crores) and an inter- bank turnover of X
4,71,327.30 (X 4,14,162 Crores) and earned Forex Profit of X 74.60
Crores (X 60.41 Crores). The outstanding export credit as on 31st Mar
2014 was X 1948.97 as against X 1908.31 as on 31st Mar 2013. The
Treasury ACY- International Banking Branch at Mumbai (A category branch)
and 33 B Category branches across the country cater to the
International business needs of the customers of the Bank. In order to
provide prompt service to Non Resident Indian (NRI) clients, Bank has a
NRI Cell at Deccan Gymkhana Branch, Pune which provides online
remittance facilities for its NRI customers. With a view to enable
branches to provide better service to NRI clients, Bank has provided
Instant NRI information which is updated on monthly basis.
The net investments of the Bank stood at X 37249.58 crore as on
31.03.2014 as compared to X 31430.31 crore as on 31.03.2013.
Investments under Held to Maturity (HTM) category consist of 86.97 per
cent while Available for Sale (AFS) comprised 12.74 per cent of total
investment portfolio as on 31.03.2014. The net interest income from
investment activity increased to X 2543.03 crore from X 2231.28 crore
during the last year, a growth of 13.97 per cent.
The borrowings of the Bank as on 31.03.2014 stood at X 8326.47 crore,
including refinance availed from RBI. NABARD and SIDBI to the extent
of X 2861.08 crore. The total borrowings as at 31.03.2013 were X
2.8 Merchant Banking
The Bank handled 84 issues of Commercial Paper amounting to X 20160.85
crore for its clients as an Issuing and Paying Agent (IPA) during the
year and earned a commission income ofRs. 9.52 lakh.
2.9 Depository Services
The Bank is Depository Participant (DP) of Central Depository Services
of India Ltd. (CDSL) since September 1999. Account level queries
related to Demat account balances etc. are available at the 131
identified branches of the Bank. All the branches of the Bank can open
Demat account through the Demat Cell of Mumbai. The Bank also provides
free ACI-EASI ACI- facility (through CDSL) to view account position
through internet. Query compliance facility is available at Maha Seva
(Customer Care Center). The Bank has added tie up with two Share
Broking Companies i.e. Reliance Securities Ltd and Ventura Securities
Ltd for Maha-e-trade (Online Share Trading) Services for its customers
along with existing Religare Securities Ltd. In order to add new
customers in its fold under Demat, Banks is offering waiver in annual
maintenance charges for the Demat Accounts opened under Rajiv Gandhi
Equity Scheme for three years.
The Annual Maintenance Charges and Dematerialization charges (for
converting Bank''s physical shares into electronic form) are waived for
staff/Ex-staff and share holders of the Bank. The Bank has also
introduced Basic Services Demat Account Facility (BSDA).
2.10 Banc assurance
All the branches of the Bank are authorized to sell life and non-life
insurance products of Life Insurance Corporation of India and United
India Insurance Co. Ltd. under corporate agency arrangements,
respectively. The Bank has sold 98929 Non-life Insurance Policies and
30554 Life Insurance policies during the year 2013-14. The LIC
accredited 198 branches of the Bank as Bima Bank, besides 17 Zones
which were declared as BIMA Zone. The Delhi Zone became Double Bima
Zone. The Bank offers group insurance scheme of LIC namely ''Maha
Suraksha Deposit Scheme (New One Year Renewable Group Assurance Plan'')
a life insurance cover of Rs 1 lakh for deposit account holders. The
Bank offers Maha Swasthya Yojana, a Family Floater Group Mediclaim
Policy of United India Insurance Co. Ltd. for its customers.
The Bank earned a commission of X 7.32 crore from life insurance,
showing growth of 10 per cent and X 4.12 crore for non-life insurance
business during the year 2013-14 showing increase of 18 per cent.
2.11 Mutual Fund Activity
The Bank has a tie-up with 25 AMCs (Asset Management Companies) for
selling Mutual Fund products. The mutual fund business mobilized by the
Bank earned commission income of X 5 lakh during the year.
2.12 Government Business
During the year 2013-14, 544553 challans of Direct Taxes were
collected ADs- similarly 1,89,696 challans of Indirect taxes were
collectedby the branches. Our Branches are also collecting other state
Govt. taxes including GRAS of Maharashtra State and the total number of
Challans collected during the Year is 5,41,220. Total commission to
the tune of X 2.70 Cr was received on Tax collection business from
Central Government and Commission received from states Tax collection
business is X 0.72 Cr. The Bank has started processing and crediting
monthly pension payments of more than 1,13,624 Central Government,
Defence, Railway and Telecom pensioners at Central Pension Processing
Cell (CPPC), Pune. The processing and payment for new PPOs/ corrigendum
PPOs Master Data base for central Government pensioners etc are being
handled by CPPC. This facilitates faster and accurate payment of
pension as well as quick settlement of funds by RBI. Timely complaint
redressal system has also been established for pension complaint. The
commission on Government Business (Pension) for the Year 2013-14 is X
The unique facility of direct ACY- Indirect taxes ACY- VAT collection
of Maharashtra is provided by the Bank, at the branch counter in all
branches through Maha e-seva services. E-payment of Taxes facility
available for net banking customers is also available for direct /
Indirect Taxes / VAT payments (for Govt. of Maharashtra). The tax
payment facility has been introduced for e-payment of custom duty ACY-
the Maharashtra State taxes are collected through integration in Govt.
Revenue Accounting System (GRAS) both online and across the counters.
The Bank has added Karnataka and Delhi states for collection of state
Government commercial taxes. Bank is offering its services in VAT
Collection in U.P in all branches.
2.13 Non Interest Income
The non-interest income stood at X 894.19 crore for the year ended
31.03.2014 as against X 912 crore for the year ended 31.03.2013.
Non-interest income (other than profit from sale of investment),
increased by X 23.20 crore in the FY 2013- 14, showing a growth of
3.02 ACU- over previous year. During the year, income from commission,
exchange and brokerage increased by X 53.48 crores from X 491.34 to X
2.14 Income, Expenditure and Profitability
The total income of the Bank grew from X 10525.43 crore to X 12850.85
crore indicating a growth of 22.09 per cent during the year.
The detailed income/ expenditure components are as under:
(Rs. in crore)
Particulars 2013-14 2012-13 Variation
Interest / discount on 9187.15 7298.50 25.88
advances / bills
Income on investments 2543.03 2231.28 13.97
Interest on interbank
lending ACY- 226.48 83.65 170.74
Total interest income 11956.66 9613.43 24.37
Non-interest income 894.19 912.00 -1.95
Total Income 12850.85 10525.43 22.09
Interest on deposits 7697.04 5879.25 30.92
Interest on borrowings 107.93 312.27 -65.44
Other Interest expenditure 642.76 388.57 65.42
Staff expenses 1595.76 1187.82 34.34
Other Operating expenses 800.99 608.82 31.56
Total Non interest expenses 2396.75 1796.64 33.40
Total Operating Expenses 10844.48 8376.73 29.46
Operating Profit 2006.37 2148.70 -6.62
Provisions and Contingencies 1620.40 1389.18 16.64
Net Profit 385.97 759.52 -49.18
2.15 Financial ratios
Particulars 2013-14 2012-13
EPS (Rs.) .56 11.88
Cost to Income Ratio (percent) 54.43 45.54
Return on assets (percent) 0.30 0.74
Return on equity (per cent) 5.93 17.32
Book value per share (Rs.) 66.69 67.10
Profit per Branch(Rs. in lakh) 20.42 43.95
Profit per employee (Rs. in lakh) 2.68 5.59
Business per Branch (Rs. in crore) 109.61 98.80
Business per employee (Rs. in crore) 14.39 12.56
Interest income as per cent to
Average 9.24 9.33
Non Interest income as per
cent to average 0.69 0.88
Net Interest Margin (per cent) 2.71 3.10
Operating Profit as per cent
to average 1.55 2.08
Staff expenses as a percent
to average 1.23 1.15
Dividend (per cent) 10.00 23.00
Net worth (Rs. Crore) 6184.11 5026.57
CRAR ( ACU-) (Basel II) 10.79 Nil
Of which, Tier I CRAR ( ACU-)
(Basel II) 7.44 Nil
2.16 Capital from Government of India
During the year, the Bank received equity share capital amounting to X
800 crore (including share premium of X 622.38 crore) from Government
of India (GOI) through allotment of shares on preferential basis. With
capital infusion, the share holding of GOI in equity share capital
increased to 85.21 ACU- as on 31.03.2014.
2.17 Net worth
The Bank''s Net worth increased from X 5026.57 crore as on 31.03.2013 to
X 6184.11 crore as on 31.03.2014.
2.18 Capital Adequacy Ratio
The Capital Adequacy Ratio stood at 10.79 per cent as on 31.03.2014,
against the minimum 9 per cent prescribed by RBI in terms of Basel III
norms. The Common Equity Tier I capital adequacy ratio stood at 7.44
The Board has recommended X 1 per share (10 ACU-) being interim dividend as
final dividend for FY 2013-14.
3. ORGANISATION AND SUPPORT SYSTEM
3.1 Branch Expansion
During the year, the Bank opened 162 new branches, the largest number
of branches opened by the Bank in a financial year since inception. As
on 31.03.2014, the total branch network comprised of 1890 branches
spread over 29 states and 4 union territories. The branch network
includes specialized branches in the areas of foreign exchange.
government business, treasury ACY- international banking. industrial
finance, small-scale industry and hi-tech agriculture. pension
payment, pension processing, retail credit, Self Help Groups and asset
Area wise classification of branches as on 31.03.2014 is given in the
No. Classification As on 31.03.13 As on 31.03.14
1 Rural 591 648
2 Semi-Urban 357 424
3 Urban 344 368
4 Metropolitan 436 450
Total 1728 1890
3.2 Human Resources Management
The Bank has put in place a comprehensive HRM Policy that provides the
road map for acquiring appropriate ACY- need based human resources, its
development through training, job enrichment, reward and recognition
for better performance, career progression, welfare and retention.
During the year the Bank recruited 1224 probationary officers and 10
law officers. The Bank has also recruited 487 Clerks during the year.
Inter scale promotions of officers were carried out for promotions to
Scales MMGS II and above. Total 1237 officers were promoted to higher
The cadre wise staff position shows that there is net addition of 776
employees during the FY 2013-14. The particulars are as below:
No. Particulars March 2014 March 2013
1 Executives 514 418
2 Officers 5576 4589
3 Clerks 5867 6065
4 Sub Staff 2439 2548
Total 14396 13620
To recognize outstanding performance in Banking activities and to
motivate others to perform better, various schemes like Performance
Linked incentives to all staff of Best Performing Branches etc. are in
vogue. Tamiya Branch (Jabalpur Zone) has been awarded the Rolling
Trophy in name of Bharat Ratna Dr. Babasaheb Ambedkar for Excellent
Performing Branch Category in disbursement and recovery of advances to
During the year, 1053 employees ceased to be in service on account of
retirement, resignation, termination and death.
The Bank has been allocating up to 3 per cent of its net profit towards
various schemes for the welfare of staff including retired staff. The
welfare schemes are administered by a Central Welfare Committee
consisting of management ACY- employees representatives.
The Bank has endeavored to promote a healthy industrial relations
climate through fair, transparent and firm handling of Industrial
The Bank has been complying with the reservation policy of Govt, of
India. Special Cells at Head Office and all Zonal Offices are
functioning to monitor the implementation of the reservation policies
and to redress grievances of SC/ST/OBC ACY- Physically challenged
employees as well as ex-servicemen. The Bank has designated Chief
Liaison Officers at Head Office and has set up SC/ST Cells at each of
its 34 Zonal Offices for the purpose. During the year periodical
meetings were held with SC/ST/OBC Employees Association to discuss
implementation of reservation policy and other constitutional safe
guards and also to facilitate involvement in business growth. Similar
meetings were also held at Zonal level.
The number of employees belonging to different categories is as under:
Sr. Category of Employees No. of Percentage
No Employees to total
1. Women 3767 26.17
2. Physically Challenged 188 1.31
3. SC Employees 2788 19.37
4. ST Employees 1091 7.58
5. OBC Employees 1738 12.07
Rosters have been maintained as per Government guidelines and are
regularly inspected/ checked.
The Bank has a training system which facilitates attention to regular
periodic assessment of skill gaps at various levels in relation to
existing and emerging business opportunities. Skill building in credit,
forex, customer relationship management, marketing of products and
services, credit monitoring and recovery, risk management, technology
based banking, branch management, complying with statutory, legal and
policy requirements and preventive vigilance received special attention
during the year.
The training programmes were also held on thrust areas like financing
SMEs, retail lending, agriculture finance and rural development.
The Bank has an apex Training College at Pune with three training
establishments operating under it, one each at Mumbai, Nagpur and Pune.
Information Technology Training Institute and Computer Labs train the
Officers and staff to utilize information technology for effective
customer service and efficient back office functions.
The highlights of training activity during the year are as under ADs-
- 322 training programs were conducted during the year out of which 111
were for officers, 153 were for clerks and 58 were for sub staffs.
- Total of 8661 staff members participated in various training
programs, consisting of 5429 officers, 2139 clerks and 1093 sub staff.
- A total of 917 SCs, 315 STs and 1207 women employees were trained
during the year.
- During the year 1461 employees were trained in Information
- In addition, 2024 employees were deputed to different external
- 11 Executives were deputed to Training Institutes outside India for
- 7 programmes for pre- promotional training to SC/ST employees were
conducted during May - June 2013. Total 298 candidates attended the
- 4 programmes on Pre retirement counseling were conducted for the
employees retiring during the year. Besides lecture on investment
planning, health check up of participants were also arranged.
3.3 Technology Initiatives
The year 2013-2014 has been a milestone year for the Bank as far as
technology implementation and up-scaling is concerned. During the year,
Bank expanded its ATM Network from 692 ATMs to 1827 ATMs, covering
nearly all the 1890 Branches of the Bank. The implementation of Bank''s
Own ATM Switch commenced during the Year and has been implemented LIVE
from 08th May 2014. Bank has been in the forefront of Technology in
Business ACY- related activities.
Bank has a state-of-the-art Tier III Data Centre and Disaster Recovery
(DR) Centre. A Near DR Site is also established to help the Bank
achieve Zero Data Loss Objective, in the event of any untoward
incident. We are one of the few Public Sector Banks to implement Near
DR Site over last two years. The efficacy of Near Site is tested twice
a year during DR Drills conducted by the Bank.
Bank has its own Corporate Network ACI-MAHANET ACI- with all Branches,
Zonal Offices, Training Colleges / Centers and Head Office interconnected
and working under Core Banking Platform. Its robust ACY- secure Network
Technology Architecture ensures seamless services to the customers.
During the year 2013-14, the process of migration of the network to
highly redundant and reliable Multi Protocol Label Switching (MPLS)-
VPN (Virtual Private Network) based architecture has been completed.
With this, we are sure that the Bank''s new network is scalable so as to
serve our customers even better and introduce more customer centric
applications. Bank has also pioneered in implementing niche network
technologies such as 3G, CDMA, etc as back up communication media to
ensure high availability to the branches.
Bank is having two ATM Galleries, one in Bajirao Raod ACY- one in Shivaji
Nagar, set-up with a view to provide integrated technology services
under one roof.
Bank has collaborated with VISA for International Debit Cards and with
NPCI for Rupay Debit Cards. Bank has also been the first Bank to launch
Rupay Kisan Debit Card - a Government of India initiative.
The payment and settlement systems viz., RTGS and NEFT are running on
robust platform facilitating straight-through- processing (STP) model.
In order to promote e-transactions ACY- popularize the usage of NEFT
Transactions, the service charges on NEFT transactions up to X 1.00
Lakh are waived.
The Bank is taking special efforts to encourage transactions through
alternate channels such as ATM, RTGS / NEFT Internet Banking, Mobile
Banking, ECS etc. More than 40 percent transactions are now being
carried out by customers through these alternate channels. Bank is
constantly pursuing efforts to enhance usage of these channels through
various incentive schemes which have been implemented during the year.
Various facilities are being provided through our Internet Banking
platform for facilitating online payment of taxes, utility bill
payments, online shopping / e-commerce, railway reservation, LIC
premium payment, etc and facility for viewing tax credit statement 26AS
and Demat account with the Bank.
As a part of the effort to respond to the ever evolving information
security trends and the responsibility to enhance security features in
the Internet Banking facility, Two Factor Authentication (2FA) Solution
for Retail Users ACY- active Corporate Users is rolled out.
Bank has robust Information Security Management System (ISMS) framework
in place. Its information security policy statement being: ACI-Bank of
Maharashtra is committed to protect and safeguard the critical
information of all stakeholders in order to ensure secure business
In order to strengthen the ISMS framework further, Bank had gone for
ISO 27001:2005 Certification for its IT division including Data Center,
Disaster Recovery Center and CBS Project Office. Bank has ensured
continuation of the ISO 27001:2005 certification for the year 2012-13
and now 2013-14 as well.
Bank has in place a captive Security Operations Centre (SOC) for
monitoring Critical IT Infrastructure on 24 x 7 basis. The SOC shall
enable the Bank to effectively address security threats by constant,
proactive monitoring of security events and meet the compliance
requirements. This has enabled the Bank to automate the vulnerability
discovery process by constantly analyzing the logs generated by the
core IT security and application infrastructure. The other services
namely Anti- Phishing ACY- Anti-Trojan services are also implemented.
As a part of Customer Initiatives, online facilities are made available
to customers for opening of savings bank accounts and also accounts
under New Pension Scheme. Bank has also made available facility for
submitting applications online for various credit facilities including
Housing, Education, Vehicle, MSME, Consumer and any other Loan product
(Generic application to accommodate any other credit facility
requirement of the customer).
Bank has launched a plethora of New IT products/services for Customers
like Cheque Deposit Machines, Digital Media Signage, Queue Management
Solution (PoC Basis), Standardized Public Grievances Redress System
(PGRS) Software, Software for Searching Branch ACY- ATM Locations of the
Bank, SMS to renewed Card Holders, e-Pact New Pension Scheme (NPS) LITE
Software, POS Usage enabled for all Rupay Cards etc.
Implementation of Biometric Authentication for Branch Staff is taken up
and expected to be completed by 31/05/2014.
Automated Data Flow, an RBI Initiative, has been implemented LIVE from
31/12/2013, as per RBI Timelines.
Cheque Truncation System has been implemented at all 27 Centres under
Southern Grid ACY- 20 Centres under Western Grid including Mumbai.
Bank has implemented own Business Correspondent Model at Solapur. Under
this model we have provided 1000 Micro ATMs to all Regions of the Bank
ACY- implementation is in progress.
All the branches of Maharashtra Gramin Bank, the Regional Rural Bank
sponsored by the Bank are working under CBS since 2011 ACY- are
implementing various initiatives to be in tune to meet the demands of
customers and business development.
Bank proposes to take up following new IT Initiatives during 2014-15.
- Newer / Evolving Branch Transformation Initiatives with focus on
enhancing customer experience. Centralization of Liability Processing
Centre (CLPC) / Asset Processing Centre (CAPC).
- Work towards establishment of Enterprise-Wide Data Warehouse,
Business Intelligence ACY- Analytical CRM.
- New - generation Mobile Banking application that can work with
variety of mobile phones ACY- platforms and provide secure transactions.
- Upgrade of Bank''s Call Centre to a complete inbound and outbound call
- E-Surveillance System to cover all ATMs.
Project ACI-Utkarsha ACI-
Bank has taken a novel step in the month of July, 2013 by forming a new
department by name ACI- Department of Strategic Initiatives ACI-. The
project is named ACI-Utkarsha ACI- and is a business transformation
programme. Bank has engaged EY as consultants for the transformation. A
team of 12 officers headed by an AGM is also formed to undertake this
project. Time lines and the scope of work are defined and the expected
time for the project completion is 18 months. The objective of Utkarsha
is to draw a strategic roadmap and align Bank''s operating model to emerge
as a more competitive, agile and efficient player. Project ACI-Utkarsha
ACI- encompasses six core elements namely Branch Transformation,
Centralization and Business Process Re-engineering, Sales Enablement
for retail and SME loans, Alternate Channels, Human Capital and Capital
The Outline of the Transformation Program ACI-Utkarsha ACI-
- Grow Rapidly
- Identify key drivers for growing deposits and advances business
- Revamp sales structure and augment skill-set to improve sales
efficiency and effectiveness
- Identify opportunities to streamline processes, aggregate non-core
processes at back-end and enhance productivity
- Design an efficient operating model to ensure business growth is not
achieved at expense of efficiency
- Optimize costs with rising scale of business, increase share of
fee-based income and improve productivity to enhance profitability
- Create a roadmap to ensure capital efficiency
3.4 Customer Centric Initiatives taken by the Bank
The Bank has pursued high standards of customer service to ensure
customer satisfaction throughout the year.
As member of the Banking Codes and Standards Board of India (BCSBI)
Bank has adopted the Code of Bank''s Commitment to Customers and Bank''s
Code of Commitment to SMEs. Duly documented policies approved by the
Board on ACI-Deposits ACI-, ACI-Collection of Cheques/ instruments
ACI-, ACI-Redressal of Grievances ACI-, ACI-Compensation ACI- and
ACI-Operational Procedure for settlement of claims of Deceased Depositors
ACI- are in place.
The Committee of the Board on Customer Service meets periodically to
monitor the quality of customer service. redressal of customer
grievances to ensure customer satisfaction. The Standing Committee on
Customer Service at Head Office and Zonal Level Customer Service
Committees at all the Zonal offices also meet regularly to address and
review various customer related matters to take steps for improvement
on an ongoing basis.
Customer Service Committees at all the branches are formed and a cross
section of customers representing depositors, Corporate, businessmen,
senior citizens are invited to attend the Customer Service meetings at
Branch/Zonal/Head Office level, to have feedback and suggestions on
schemes, products and services. Full-fledged grievances redressal
machinery is in place to respond promptly to customer grievances.
Complaint Management Cells are operative at Head Office and all Zonal
Offices of the Bank. The Committee of the Board on Customer Service and
Standing Committee on Customer Service at Head Office monitor the
progress of redressal of customer grievances regularly.
The Bank has implemented all major recommendations of Goiporia
Committee, Dr.S.S. Tarapore Committee and Damodaran Committee relating
to customer service.
The Bank has in place internet based mechanism for lodging the
complaint or to give suggestions/ feedback on services by the customers
and for providing acknowledgement and status of their feedback/
Bank has printed folder called ACI-My Folder ACI- containing all customer
service policies, information on service charges, guidelines on
Government Schematic Loans, Ombudsman and BCSBI codes. The same is
printed in Marathi, Hindi and English and supplied to all branches and
Zones for making the same available to all customers on demand.
Standardized Public Grievances Redressal System:
Bank is in process of implementing ACI-Standardized Public Grievances
Redressal System (SPGRS) ACI- introduced by GOI, MOF, Department of
Financial Services, New Delhi on 11.06.2012. I T Department and
Planning Department in Head Office are developing In House software for
Integrated Public Grievances System.
Installation of Kiosk Machine for online registration of complaints:
Kiosk Machine arrangement has been made at Head Office to enable the
customers to register on line complaints/ suggestions, and its
operation is started w.e.f. 14.03.2013.
Know Your Customer (KYC) norms / Anti Money Laundering (AML) standards
/ Combating of Financing of Terrorism (CFT) and Obligation of Bank
under Prevention of Money Laundering Act (PMLA) 2002.
The Bank has Board approved KYC-AML-CFT Policy in place. The said
Policy is the foundation on which the Bank''s implementation of KYC
norms, AML standards and CFT measures is based. The full KYC compliance
entails staff education as well as customer education for which the
following measures are taken by the Bank.
A comprehensive list of KYC documents is uploaded on the Bank''s web
site for the benefit of customers. Regular training sessions are
conducted on KYC-AML-CFT guidelines at the Bank''s training
establishments to sensitize the employees.
3.6 Risk Management
Banks are faced with a variety of risks while conducting day to day
banking operations. Bank has its Risk Management Frame work in
accordance with the RBI Guidelines and benchmarks itself against the
industry best practices. This enables the Bank to identify, measure,
monitor and manage risk efficiently.
The Board of Directors of the Bank reviews all Risk Management Policies
and Strategies and establishes control systems in line with the Bank''s
aggregate Risk Appetite. The Board of Directors is supported by the
Risk Management Committee of the Board (RMC) and RMC is supported by
sub- committees known as Credit Risk Management Committee (CRMC),
Market Risk Management Committee (MRMC), Operational Risk Management
Committee (ORMC) and Asset Liability Management Committee (ALCO). These
Committees are headed by Chairman and Managing Director. Executive
Directors and General Managers are the members of the Committees.
Risk Management Policies
In order to provide ready reference and guidance to field
functionaries, Bank has put in place various Board approved Risk
Management Policies viz. (i) Credit Risk Management Policy, (ii) Market
Risk Management Policy, (iii) Asset Liability Management Policy, (iv)
Operational Risk Management Policy, (v) Stress Testing Policy, (vi)
Outsourcing Policy, (vii) Business Continuity Planning Policy, (viii)
Disclosure Policy, (ix) Utilization of Credit Risk Mitigation
Techniques and Collateral Management Policy ACY- (x) Internal Capital
Adequacy Assessment Process (ICAAP).
Credit Risk Management
Credit risk is the possibility of a loss being incurred as the result
of a borrower or counterparty failing to meet its financial obligations
or as a result of deterioration in the credit quality of the borrower
or counterparty. Effective credit risk management is a structured
process to assess, measure, monitor and manage risk on a consistent
basis. This requires careful consideration of proposed extensions of
credit, the setting of specific limits, monitoring during the life of
the exposure, active use of credit mitigation tools and a disciplined
approach to recognizing credit impairment. The Credit Risk Management
process forms an integral part of overall risk management of the Bank.
The Bank has constituted Credit Risk Management Committee (CRMC) which
reviews the policies, procedures and systems relating to credit
administration and monitoring, at periodic intervals.
The Bank has put in place comprehensive Lending Policy, Loan Review
Policy and Credit Risk Management Policy for credit risk management.
The policies prescribe various guidelines, procedures, standards and
prudential / exposure norms.
To evaluate the risk perception in a lending proposition, the Bank has
put in place an in-house developed Credit Risk Rating Framework (CRRF)
for rating of existing as well as entry level borrowers in various
asset classes, as desired under Basel III. In house developed rating
model in TIBD is also in use to rate Non-SLR Investments. The Bank
utilizes industry risk rating from reputed credit rating agency and
incorporates the industry risk score in the CRR Models. Bank also uses
the rating assigned by RBI approved external credit rating agencies in
its credit decision.
The Bank has prescribed threshold ratings for entry level exposures
with a view to building up credit portfolio within the risk appetite
and achieves the profit plan. With a view to separating the Credit Risk
Management function from credit sanctioning, Credit Risk Rating
Approval Grids are set up at various levels at Head Office and at
Treasury ACY- International Banking Division (TIBD), Mumbai which assess
the risk perception through a committee approach.
The Bank has undertaken migration analysis of credit risk rating of
borrowers over a time horizon and probability of default has been
estimated in line with Basel requirements. To achieve risk-return trade
off, risk based pricing framework has been implemented and reviewed
The Bank undertakes following studies periodically to assess Credit
Compliance to Prudential Norms as per Lending Policy
Credit Portfolio Review
Assessment of Concentration Risk in Assets ACY- Liabilities
Quick Mortality of Loans and Advances
Country Risk Management
Aggregate exposure on other banks
Stress Test Report - Credit Risk
Finding of these studies are placed before the Credit Risk
Management Committee (CRMC), Risk Management Committee (RMC) and the
Board on periodical basis.
Market Risk Management
Market Risk is the risk to the Bank resulting from adverse movements in
market prices due to changes in interest rates, foreign exchange rates
and equity price. The changes impact the Bank''s earnings and capital
and can have ramifications on the Bank''s liquidity and profitability.
Bank has its separate Market Risk Management Committee which reviews
Market Risk Management Policy on regular basis and reports
modifications, if any, to the Risk Management Committee ACY- the Board for
approval. The Bank''s Market Risk Management Policy aims to set out the
broad processes i.e. by which the Bank will identify risks in the areas
of Interest Rate Risk, Forex Risk, Equity Price Risk and Options Risk.
Reporting framework has been prescribed for internal reporting,
Regulatory reporting and Pillar III disclosures.
Interest Rate Risk Management
Interest rate risk is the risk where changes in market interest rates
affect a bank''s financial position. Changes in interest rates impact a
bank''s earnings (i.e. reported profits) through changes in its Net
Interest Income (NII) and also impact a bank''s Market Value of Equity
(MVE) or Net Worth through changes in the economic value of its rate
sensitive assets, liabilities and off-balance sheet positions. The
interest rate risk, when viewed from these two perspectives, is known
as ''earnings perspective'' and ''economic value perspective'',
Accordingly, Bank uses the following tools to manage interest rate
1. Traditional Gap Analysis (TGA) which is undertaken through the
preparation of Interest Rate Sensitive Gap Reports on a monthly basis.
2. Earning at Risk: Calculation of impact on NII due to 1 ACU- change in
interest rates. It also takes into account Basis Risk, Embedded Option
Risk, Yield Cure Risk, Net Interest Position Risk, Price Risk and
3. Duration Gap Analysis (DGA) which focuses on the bank''s exposure to
Interest Rate Risk in Banking Book (IRRBB) in terms of sensitivity of
Market Value of its Equity (MVE) to interest rate movements.
4. Modified Duration: Considering the interest rate risk in the
portfolio, the Bank has set upper limits of Modified Duration for
AFS HFQ- category and also the upper limit for total investment
5. Value at Risk: Value at Risk (VaR) for treasury positions is
calculated for 1 Day, 10 Days and 30 Days for 99 ACU- Confidence Level.
The Bank has constituted Asset Liability Management Committee (ALCO),
which meets at regular intervals to review the interest rate scenarios,
liquidity positions in the banking book etc. The ALCO manages and
supervises Liquidity Risk through review of rates of interest on
deposits / advances. ALCO also monitors adherence to various risk
limits and determines the business strategy in light of prevailing
interest rate scenario and liquidity position in the market with a view
to optimizing profit and overall balance sheet management while
managing interest rate risk.
The ALM Policy, which is reviewed annually, prescribes the parameters
for management of Liquidity Risk, Interest Rate Risk, etc.
Investment Risk is managed through the prescriptions made in the
Investment Management Policy ACY- Investment Risk Management Policy.
Management of Foreign Exchange Risk, prudential limits for open foreign
exchange position, aggregate gap position, Daylight limit, Overnight
limit, Net Open Overnight Position. Stop loss limit, Limit for
undertaking swaps/investment/ borrowing overseas, interbank exposure
limits etc. have been put in place. These limits are monitored
The ''Liquidity Risk is measured and managed through ''Gap analysis'' for
maturity mismatches by reviewing structural liquidity position on daily
basis and short term dynamic liquidity on fortnightly basis. Bank is
conducting behavioral studies in GAP analysis. Stress testing is
Operational Risk Management
Operational risk is the risk of loss resulting from inadequate or
failed internal processes, people or systems or from external events.
Bank''s primary aim is the early identification. recording, assessment,
monitoring, prevention and mitigation of operational risks, as well as
timely and meaningful management reporting.
The Operational Risk Management Committee (ORMC) meets regularly to
review the matters related to operational risk. Under the Operational
Risk Management Framework and ORM Policy, Bank is identifying,
measuring, monitoring and controlling/mitigating operational risks by
analyzing historical loss data, Risk and Control Self-Assessment
Surveys (RCSAs) and Key Risk Indicators (KRIs). The Bank has put in
place policy on Business Continuity Planning. A policy on outsourcing
is also formulated which facilitates use of expertise available in the
market with adequate safeguards against risk associated with
Under the Risk based supervision, Risk Profile Template covering five
business risks and two control risks are prepared on quarterly basis
and submitted to RBI.
Rating of the branches is done under Risk-based Internal Audit (RBIA)
and the position is reviewed every quarter.
Implementation of Advanced Approaches of Capital Computation
The Bank will enhance its Risk and Capital Management capabilities by
migrating to the Advanced Approaches of the Basel framework. Advanced
approaches include Foundation and Advanced Internal Ratings Based
Approach (''FIRBA ACY- ''AIRBA) for Credit Risk, Standardized and Advanced
Measurement Approach (TSA ACY- AMA) for Operational Risk and Internal
Models Approach (''IMA) for Market Risk.
3.7 Internal Control Systems
Inspection ACY- Concurrent Audit:
The Inspection and Audit system ACY- various measures of internal control
are adopted by the Bank to ensure identification /assessment and
mitigations of operational risks.
Internal Audit of branches:
As per Seth Committee guidelines the Bank is conducting Risk Based
Internal Audit of the branches. RBIA of all the branches which were due
for RBIA during the year, were conducted while complying with the
Jilani Committee recommendations. It was endeavored that the top 200
branches in advances terms of the Bank are covered under RBIA during
During the year the Bank has implemented some strategic decisions so as
to strengthen the internal control system such as,
- Commencement of Off-site monitoring system in which reports on some
important/sensitive areas are extracted from the CBS system on
daily/weekly/monthly basis so that necessary timely
rectification/action can be taken.
- On the spot rectification of at least 51 ACU- irregularities during the
course of inspection itself in the branches.
- Implementation of Document mechanization system.
- Initiating the process of Web Based application system so as to
improve Branch Inspection, Concurrent Audit system and Off-site
During the year the Bank also organized conference of all Inspecting
Officials and Heads of Inspection Cells so as to update them on
policies, procedures, business environment, opportunities and
challenges for banks, emerging areas of risks and their role in
alerting the Top Management of existing and impending risks at
branches and offices.
Surprise Inspection of 23 branches, focusing mainly on high risk areas
was also carried out in pursuance of Ghosh Committee Recommendations.
All the 23 reports are closed.
As per approved Audit Plan for 2013-2014, 418 branches and three
departments of the Bank are covered under Concurrent Audit covering
about 75.78 ACU- of Bank''s total business.
Income ACY- Expenditure Audit (I. ACY- E. Audit):
I. ACY- E. audit is carried out at 180 branches as per approved plan for
the period 01.10.2012 to 30.09.2013 having total business above X 25.00
crore ACY- advances above X 5.00 crore.
Expenses Audit of Zonal Office:
In order to have control over expenditure at Zonal Offices a system has
been put in place through half yearly Expenses Audit for every March
and September half years. The expenses audit of 34 Zones were conducted
as of 30.09.13.
The Bank has also initiated the process of Snap audit of select
branches where the growth in advances is inconsistent or especially
contrary to the past trend.
For assessing their effectiveness of Zonal Offices and different
departments in the Head Office in terms of supervision and control,
Management Audit of 17 Zonal offices and 16 departments at Head Office
was carried out during the year.
RBI Inspection under Section 35 of the Banking Regulation Act:
The Bank was also subject to RBI inspection under Section 35 of the
Banking Regulation Act besides that two branches were also inspected
during the year.
Bank has also reviewed the AML parameters as per IBA guidelines and
Prevention of Anti Money Laundering Act. In order to ensure efficacy of
the AML system, a centralized AML Cell has been established at Head
Vigilance activity in the Bank is an integral part of the managerial
function. Its objective is to enhance the level of managerial
efficiency, effectiveness and to ensure a proper climate for an
efficient administration, where officials can perform the duties
without any fear or favor. ''Vigilance'' in the Bank is maintaining a
proper balance between flexibility and accountability.
Preventive Vigilance is the most important aspect of vigilance. With a
view to improve functioning at all levels, the Bank has taken several
necessary steps. ''Fraud Risk Management Policy'' on prevention,
detection, classification and reporting of frauds including action to
be taken, has been adopted by the Bank and circulated for the guidance
and use of the branches and field functionaries.
''Vigilance Manual'' has been issued by the bank and various aspects of
vigilance and other related issues have been dwelt upon for information
and necessary action of the field functionaries.
The Bank has put in place a Compliance Policy, based on the guidelines
of Reserve Bank of India. The Compliance Department, headed by the
Chief Compliance Officer monitors the compliance functions. It ensures
the implementation of the statutory/regulatory guidelines coming into
force from time to time. The issues relating to regulatory/ statutory
compliances are addressed appropriately. The status of compliance is
placed for review to the Top Management / Audit Committee of the Board
periodically. To improve the awareness on the compliance functions in
the Bank, sessions are appropriately included in various training
programmes arranged for the officers /staff members.
3.10 Marketing ACY- Publicity
With a view to publicize Bank''s various products and also brand image
coupled with corporate social responsibilities, Bank has sponsored
various programs like ACI-Sponsorship to BWF Badminton world super
series ACY- Ashian Athletics Championship ACI- ACI-Connotation on
Global warming ACI- ACI-Sponsorship for Mobile dispensary/Dialysis
machine ACY- other medical equipments ACI- ACI-Child Development Centre
ACY- Health camps for SHGs ACI- ACI-Project Spinal injury centre ACI-
etc. Bank has also donated towards relief fund to Flood ACY- Cyclone
affected people and development of Tribal villages.
3.11 Citizen''s Charter
The Bank has adopted the Charter since 2000-01, which details the
duties and responsibilities of the Bank towards its customers. The
Charter is displayed at all the branches and at the website and has
been updated from time to time. The Bank has also adopted a Citizen
Charter of RBI on exchange of notes and coins.
4. SOCIAL BANKING
4.1 Priority Sector Lending
It has been the constant endeavor of the Bank to facilitate equitable
and sustainable economic development by timely and hassle-free
availability of credit for productive purposes to Small and Marginal
Farmers, Micro ACY- Small Enterprises, Retail Traders, Professional
ACY- Self Employed, Women Entrepreneurs and entrepreneurs from
economically weaker sections.
The outstanding advances under Priority Sector as of 31st March 2014
aggregates to X 32010.68 crore, constituting 41.99 ACU- of the Adjusted
Net Bank Credit.
The rise in Priority Sector Advances in absolute terms is X 7291.32
crore over previous year March 2013, resulting into growth of 29.50
ACU- on y-o-y basis.
The Bank disbursed X 5909.54 crore for agriculture and allied
activities during the year 2013-14. The total outstanding advances to
agriculture sector have shown a growth of 28.89 per cent on y-o-y
basis, to reach a level of X 10276.07 crore as on 31.03.2014.
The Bank undertook awareness/sensitization programmes for all the
branches for increasing advances to agriculture by providing hassle
free credit to farmers.
4.2.1 Mahabank Kisan Credit Card (MKCC)
This scheme gained popularity especially in rural areas where it is
being propagated successfully and vigorously. The Bank has issued total
470762 Kisan Credit Cards to farmers. Credit flow to MKCC
beneficiaries has reached to the level of X 4312.60 crore as on
31.03.2014, registering a growth of 42.83 ACU- on y-o-y basis.
4.3 Micro, Small and Medium Enterprises (MSME)
SMEs are recognized as a major growth engine for the Indian economy.
They generate opportunities for direct and indirect employment by
facilitating use of natural resources and local skills to stem the tide
of migration to urban areas and promote low investment enterprises.
Finance is made available to viable enterprises at an attractive and
low rate of interest. On line enquiry portal is made available on the
Bank''s website during the year.
The Bank has adopted Simplified Loan Application for MSEs and the same
is displayed on the Bank''s website. The Bank has also adopted Bank''s
Code of Commitment to Micro and Small Enterprise and it is displayed on
the Bank''s website.
The Bank''s lending to Micro, Small and Medium Enterprises which was at
the level of X 11288.92 crore as at 31.03.2013, increased to X 15098.25
crore as at 31.03.2014, which translates into a y-o-y growth of 33.74
Mahabank MSME centres - Centralized Processing Cell have been set up
for speedy disposal of MSME proposals at Pune, Hyderabad, Delhi and
Under the scheme, the Bank is providing for supporting SMEs in rural
areas finance up to X 100.00 lacs to Micro and Small Enterprises
without Collateral Security and/ or Third Party Guarantee.
Accounts under the scheme are covered under Credit Guarantee Fund
Scheme for Micro, Small and Medium Enterprises of Government of India.
The Bank is bearing 50 ACU- annual guarantee fee for loans above X 10.00
lakh ACY- entire annual guarantee fee for loans below X 10.00 lakh. The
Bank sanctioned loans of X 1040.37 crore to 11,436 borrowers under this
scheme up to March 2014. During the current FY coverage under Credit
Guarantee Fund Scheme has increased by 36.11 ACU-.
5. IMPORTANT SCHEMES/PROJECTS OF THE BANK
5.1 Credit Flow to Retail Sector
The Bank is providing retail loans to salaried persons, professionals,
businessmen and pensioners for purchase of consumer durables, two/four
wheeler vehicles and also for other personal needs.
5.1.1 Centralized Processing of Retail loans:
There are 14 Retail Asset Branches and 18 Retail Processing Centers
covering all the Zones for hassle free and quality disbursement of
5.1.2 Mahabank Gold Loan Scheme
Gold ornaments are the traditional and inherited form of savings among
the people in India. Being one of the most liquid and precious asset,
it serves as a dependable and acceptable form of security to raise
loans for meeting immediate financial needs for business, agricultural.
consumption purposes such as marriage, medical, educational expenses
etc. With a view to meet the credit requirement of our customers, Bank
has launched a new retail loan product ACI-Mahabank Gold Loan Scheme ACI- w.
e. f. 01.11.2010. The total portfolio of Gold Loan of our Bank is X
5.1.3 Mahabank Top-Up Loan Scheme
In order to extend additional credit support to our regular housing
loan borrowers, Bank launched another new Retail Loan product ACI-Mahabank
Top-Up loan scheme ACI- w.e.f. 01.11.2010.
5.2 Housing loan to public
The Bank has in place Housing Loan Scheme to meet the needs of all
economic segments including NRIs. Financing housing sector in rural and
urban parts of India is a thrust area. The Bank''s lending to housing
sector has grown by 34.63 percent during the year to reach the level of
X 8854.40 crore as of 31.03.2014. The Bank is also implementing Golden
Jubilee Rural Housing Scheme of the Government of India in rural areas
having population not exceeding 50,000. Bank is having online facility
to apply for housing loan, which has evoked positive response.
5.2.1 One per cent Interest Subvention on Housing Loan up to X 15.00
As per GOI guidelines, Bank has provided 1 ACU- interest subvention to
borrowers, who availed housing loans upto X 15.00 lakh costing worth
upto X 25.00 lakh. During the year 2013-14, 5941 borrowers benefited
under the scheme to the extent of X 5.50 crore.
5.3 Model Educational Loan scheme
With the objective of ensuring that all deserving students get
opportunity to pursue higher education, the Bank implemented a Model
Educational Loan Scheme. As of March 2014, the Bank had lent X 637.34
crore to 29,876 students. The Bank has provided the facility of
submission of application for education loan through web-access (on
5.4 Micro Finance
The Bank has always recognized the importance of credit to rural and
urban poor for taking economic activity. The SHGs have proved to be
effective instruments for empowerment of women. Bank has specialized
SHG branches in all six lead districts and at Goregaon, Mumbai.
As on 31.03.2014, there were 108964 SHGs formed by the Bank, out of
which 97261 SHGs have been linked with the bank credit with outstanding
of X 160.71 crore as on March 2014.
5.5 Assistance to SC/ST beneficiaries:
The Bank has been actively extending finance to SC/ST beneficiaries
through various schemes. Total finance as on 31.03.2014 to SC/ST
beneficiaries stood at X 1511.80 crore, constituting 20.41 per cent of
advances to weaker sections.
5.6 Advances to Minority Community
A special cell has been set up at Central Office to review ACY- ensure
smooth flow of Credit to minority community. As of March 2014, the
outstanding advances to minority communities were at X 2258.72 crore to
5.7 Door Step banking Services
Bank has introduced Door Step Banking Services for its High End
Customers and the services include Corporate and Retail Cash pickup and
delivery ACY- Cheque Collection Services, at Clients'' Doorstep. The
Services has been initially introduced in Mumbai and Pune which is now
extended to all Centers except branches in the Bhopal Zone.
5.8 BOM SBI International Credit Card
Bank is offering Co-branded International Credit Card to its customer
under tie-up arrangement with SBI cards. The card is offered in two
variants viz.Platinum and Gold card. As on 31.03.2014, the outstanding
number of cards issued to its customer is 23861.
5.9 National Pension System (Swavlamban)
NPS Lite Swavalamban was made live in July 2013 and total 1806 branches
are registered as NLCC (NPS Lite Collection Centre) with NSDL for
collecting contribution under the scheme. 11833 accounts were opened
under the scheme up to 31.03.2014.
5.10 Tie Up
5.10.1 Empanelment as lead Generation agent for SHCIL.
Bank has entered into tie up arrangement with Stock Holding Corporation
of India Ltd. (SHCIL) in Maharashtra wherein Bank is empanelled with
SHCIL as the lead generation agent. The bank role is to popularize
e-stamping system across Maharashtra and provide information to
customers and guide customers to SHCIL office for their e-stamp
5.10.2 Remit2india'' by ''Timesofmoney''
Bank has tie up with Timesofmoney for introducing remit2india an online
platform for remittance of funds by NRI customers.
5.10.3 Payment Gateway Facility
Bank has tie up with M/s India ldeas.com Ltd, M/s Avenues India Ltd.,
M/s Atom Technologies Ltd, M/s ibibo web Solution Ltd, M/s Citrus
Payment Solutions Pvt Ltd, M/s One 97 Communication Ltd, M/s EBS
payment System, M/s Techprocess Payment System, M/s Times of Money
Limited for facilitating e-commerce and utility bill payment facility
to its internet banking customers.
5.10.4 ECS Mandate and Direct Debit System
Bank has tied up with Bajaj Finance Ltd. and TVS Credit Pvt. Ltd for
ECS Mandate verification of Fresh Mandate and Direct debit system of
5.10.5 Online Fee Collection
Bank has entered into tie up with various Institutions during the year
where bank is getting commission on collection of fees for Institutes
from Branches. The bank is collecting online fee collection for Mumbai
University from the students appearing for external educational
programme. The Mumbai University selected Bank from the group of 5
6. CORPORATE SOCIAL RESPONSIBILITY
The Rural Development Centres at Hadapsar and Bhigwan in Pune District
of Maharashtra have been undertaking various rural developmental
activities for the benefit of farmers viz. Lab to Land Project,
Re-development of Saline Soils, Soil Testing etc. Bank has established
Soil testing Lab (STL) through MARDEF Trust at RDC Bhigwan. The Soil
Testing Laboratory has analyzed 8892 Soil ACY- Water samples in the year
2013-14 and accordingly counseling is done. Farmers from the districts
of Pune, Ahmednagar, Solapur and Satara are taking benefit of the lab.
A Trust viz. Mahabank Agricultural Research and Rural Development
Foundation (MARDEF) established by the bank, undertakes various
projects and village improvement programmes. MARDEF is imparting
training to farmers on various subjects in Agriculture, e.g. Dairy,
Goat rearing, Best practices in farming, Application of fertilizers,
Agriculture credit schemes, etc. MARDEF Trust has implemented 96
training programmes for farmers at RDC Bhigwan ACY- Hadapsar and has
benefited 5211 farmers from April 2013 to March, 2014.
The Bank has established Seven Mahabank Self Employment Training
Institutes (MSETI) for providing training to rural youth and women to
enable them to acquire skills for self- employment through small
business enterprises. The Institute has centers located at Pune,
Nagpur, Aurangabad, Amravati Jalna, Thane and Nasik. The Institute has
so far imparted training to 12,666 educated unemployed youths. The
settlement rate is 67 per cent.
Gramin Mahila Va Balak Vikas Mandal (GMVBVM), an NGO formed by Bank of
Maharashtra and National Institute of Bank Management is actively
involved in formation, nurturing, training and ensuring linkage of SHGs
to Bank Credit. The GMVBVM also helps SHGs in marketing products of
SHGs through outlet established in Pune City under the name ACI-SAVITRI ACI-.
The GMVBVM guides and actively helps SHGs for selection and purchase of
raw materials and quality production.
The Bank has opened Financial Literacy Centers in Six Lead Districts
namely Pune, Nasik, Aurangabad, Satara, Jalna ACY- Thane for creating
awareness about banking schemes.
Bank has helped various NGOs during the year extending financial
support to acquire necessary inputs for carrying their activities.
These include the following:
- Fixing of artificial limbs to the needy patients.
- Diesel Generator set for the school meant for physically challenged
- Building / classroom / Kindergarten equipments for the needy,
mentally retarded and cerebral palsy children, cancer patients and Old
- Conducting cancer detection camps in slums for the needy.
Moreover Bank has always stood for the cause of society by contributing
at large for improving medical facilities, vocational training, basic
amenities etc. Bank is also helping emerging sports persons at budding
stage by sponsorships and providing financial assistance to bring the
glory to the Nation and contributing to social cause.
7. LEAD BANK SCHEME
7.1 Lead Bank Scheme
Bank has Lead Bank responsibility in six districts of Maharashtra State
viz. Aurangabad, Jalna, Nasik, Pune, Satara ACY- Thane. Every year our
Bank is successful in achieving the targets under Annual Credit Plan
with achievement under various sub sectoral targets.
7.2 State Level Bankers'' Committee
Bank is the Convener of State Level Bankers'' Committee (SLBC) for the
State of Maharashtra. Quarterly meetings are held regularly. Detailed
discussions are held and implementation of various schemes like ACP
achievement, Priority Sector lending, financial inclusion and
Government Sponsored Schemes are reviewed. The performance of various
participants is monitored and guidelines are given to LDMs / Banks for
their improvement. A special SLBC meeting was convened which was
chaired by Hon''ble Chief Minister of the State. An ambitious ACP of X
1.00 lakh Crore was accepted, which is highest in the country. The
performance of SLBC was commended by Chief Minister. The crop loan
achievement for this year was 90 ACU-. SLBC has taken proactive steps for
supporting the farmers suffered due to Drought / Hail Storms by issuing
guidelines immediately and following up with all the implementing
agencies. SLBC has also taken a proactive step in providing the credit
to the farmers in all the districts where the DCCBs are not in a
position to lend by providing a major share of crop loans to Commercial
As conveners of SLBC, Bank is also coordinating with all member banks
in implementing Direct Benefit Transfer. As Convener, bank has taken
special emphasis on opening of accounts and seeding of aadhaar numbers
of the DBT beneficiaries, in formation of 13,431 Sub service areas and
in coverage of all the sub service areas in DBT districts. SLBC has
also taken proactive role in implementation of DBTL scheme. Meetings
were held with District Authorities, OMCs and District Coordinators of
member Banks to ensure better coordination among these implementing
agencies. SLBC has also taken the lead in monitoring the progress for
making available the delivery channels such as opening of branches,
installation of ATMs and providing the services of Business
7.3 Aadhaar Initiatives
The Bank is acting as Non State Registrar (NSR) with Unique
Identification Authority of India (UIDAI) to assist authority for
enrolment of Aadhaar. For Aadhaar enrollment to the resident''s bank has
engaged agencies. Bank has enrolled more than 21 lakh Aadhaar numbers
with the help of these agencies Bank has taken the initiative for
seeding of Aadhaar numbers and has approached customers requesting them
for submission of their Aadhaar numbers. Aadhaar seeding is also done
through our ATMs and Internet Banking apart from requests received
directly. Due to these initiatives Bank is successful in seeding of
more than 26 lakh Aadhaar numbers.
7.4 Financial Inclusion Plan
Financial inclusion is one of the key agenda items of the Government as
well as Reserve Bank of India. Bank has taken Financial Inclusion as
business opportunity and has made banking services available in 6,713
villages of the State through innovative BC - ICT model. For this
purpose bank has appointed 2,472 BC agents of various agencies for
providing basic banking services as opening of bank accounts of
villagers, provide need based credit, remittance facilities and help to
promote financial literacy in rural India using various models and
technologies including branchless models.
Bank has opened 4,40,646 customers'' accounts through BC agents ACY- a
total of 28.43 lakh Basic Saving Bank Deposit Accounts (BSBDA) with an
outstanding balance of X 203.19 Crore. Bank has also made efforts to
make BC model sustainable by way of introducing card less technology
for FI customers. Bank has introduced AEPS - Aadhaar Enabled Payment
System (On us and Off us - Acquirer and Issuer) technology, both
functioning in the same POS machine. This has helped to increase the
number of transactions during the financial year. The number of
transactions increased from 0.95 lakhs to 4.66 lakhs during the year.
The amount increased multifold from X 2.93 crore to X 101 crore.
Govt, of India is implementing the scheme of Direct Benefit Transfer
(DBT). Under this scheme Govt. subsidies to the beneficiaries of 26
notified schemes are directly credited to the Aadhaar enabled bank
account of the beneficiary in 121 districts. Out of these 121 districts
we are operating in 71 districts with 632 branches. Under this scheme
Bank has the responsibility of three districts as lead districts. Bank
has ensured that all the beneficiaries under the scheme have their
account with the bank and their Aadhaar number received from the
district authority has been seeded to the accounts and uploaded with
NPCI server. Bank had arranged special camps for opening of accounts as
well as for enrolment of Aadhaar. Bank has also participated in
implementing DBTL program and ensured maximum Aadhaar seeding of the
8. SUBSIDIARIES/JOINT VENTURES AND SPONSORED INSTITUTIONS
8.1 Performance of Regional Rural Bank
Maharashtra Gramin Bank (MGB) is a Regional Rural Bank sponsored by our
bank having its Head Office at Nanded, Maharashtra state. Total no of
branches as on 31.3.2014 stood at 378 in its area of operation covering
16 out of 33 districts of Maharashtra State.
All 378 branches ACY- controlling offices are now under CBS. During this
year, MGB opened 27 new branches and plans to open further more.
During this year, CASA share has improved from 62.75 ACU- to 64.27 ACU-,
other income has improved from 21.75 Crore to 25.13 Crore resulting in
increase in Net profit from 26.97 Crore to 35.51 Crore.
Under Financial Inclusion programme, all 355 allotted villages are
covered under ICT based model. M/s Vakrangee Finserve Ltd., selected
through common RFP has been engaged as the BC for providing BC services
in all the villages allotted to the Bank, which is functioning
During this year 2013-14, MGB has grown by 7.68 ACU- in total deposits and
14.20 ACU- in advances. It has achieved three SOI targets for the year
2013-14. The position of SOI targets and achievement are as under:-
Sr. Actual Target Actual
No. Parameter 31.03.2013 31.03.2014 31.03.2014
14 Performance of RRBs
14.1 Deposit Growth in ACU- 19.12 ACU- 12.50 ACU- 7.68 ACU-
14.2 Advance Growth in ACU- 38.09 ACU- 20.00 ACU- 14.20 ACU-
14.4 Branches under CBS 351 365 378
14.5 Profit per employee
(Rs. In 2.13 2.40 2.67
14.6 No. of loss making 18 30 18
branches (being 12
months old or more)
8.2 The Maharashtra Executor ACY- Trustee Company Pvt. Ltd. (METCO)
The Maharashtra Executor ACY- Trustee Company Pvt. Ltd. (METCO), the
100 ACU- subsidiary of Bank of Maharashtra was established in 1946 with
an aim to provide services auxiliary to banking such as:
- Consultation, Drafting ACY- Execution of will
- Consultation, Drafting and Management of Private Trusts / Public
- Management of investments ACY- house properties as attorney
- Guardianship of minor''s property
- Consultation for sale / purchase of property
- Filing of I-Tax Returns for individuals
The Company is located at Pune having its branch units at Pune,
Vashi-Mumbai, Thane and Nagpur
During 2013-14, company could get new assignments for management of
additional 9 Trusts bringing total 1070 Public ACY- Private Trusts under
our fold for management. During the year, additional 41 WILLS were
added making total 1069 WILLS in our custody for execution.
At present, the Company manages properties both movable and immovable
of 82 clients under the Power of Attorney. The Company also acts as the
Trustees in respect of 170 policies under Married Women''s Property Act
and as Court appointed Guardian of minor''s property in 6 cases.
9. IMPLEMENTION OF OFFICIAL LANGUAGE POLICY
During the year 2013-14, the Bank has made various remarkable
achievements in the field of Official Language implementation.
Two prestigious Hindi-serving Institutions, Mumbai based Aashirvad and
Kolkata based Rashtreeya Hindi Academy, Roopambra, awarded trophy to
our bank for better use of Hindi implementation and and shield for
Rajbhasha Visheshank of our house magazine ACI-Mahabank Pragati ACI-.
On 17th and 18th August, 2013, a two-day seminar was organized in
Kolkata for all Official Language Officers of our bank. Seminar was
Inaugurated by the then C ACY-MD Shri Narendra Singh. Director of the
bank, Dr.R.K.Agrawal also graced the occasion.
On 14th September, 2013, Hindi day function was held in Head Office,
Pune, which was headed by the then C ACY-MD Shri Narendra Singh. On this
occasion, shields were presented to the winner Zonal Offices, Branches
and Head Office Deptts of bank''s internal Rajbhasha Trophy Scheme for
the year 2012- 13.
On 3rd March, 2014, 29th meeting of Maharashtra State Level Banker''s
Committee (Rajbhasha) was held at Head Office, Lokmangal, Pune.
Executive Director, Shri R. Athmaram headed the meeting. Shields were
presented to the winner member banks and financial institutions of
state level Rajbhasha Shield competition.
Zonal Office, Akola, Raipur, Nagpur ACY- Kolkata and Vijaywada branch of
Hyderabad Zone were awarded various prizes for better use of Hindi by
various Town official Language Implementation Committees.
During the year 2013-14, Deputy Director (O.L.), Regional
Implementation Office, Department of Official Language. Ministry of
Home Affairs inspected the progressive use of Hindi at our Nagpur,
Nasik ACY- Chennai Zonal Offices.
Chief Manager (Rajbhasha) Shri Anand Prakash Jaiswal has been nominated
as a member in RBI''s ACI-Banking Glossary Committee ACI-.
Shri Deepak Bhalchandra Karpe, Clerk of our Dewas branch has been
awarded in RBI''s Inter-bank Hindi Essay competition.
Hon''ble Governor of Madhya Pradesh handed over Madhya Pradesh
Rashtrbhasha Prachar Samiti, Bhopal ACI-Hinditar Sevi Samman ACI- along
with certificate to our Chief Manager, Shri Girish Vaghela.
A national level one-day seminar was arranged by TOLIC Pune with
support from Pune College, Camp. Our Bank is the convener of this
10. DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors confirm that in the preparation of the annual accounts
for the year ended 31.03.2014:
- The applicable accounting standards of the Institute of Chartered
Accountants of India, have been followed along with proper explanation
relating to material departures, if any ADs-
- The accounting policies framed in accordance with the guidelines of
the Reserve Bank of India, are consistently applied and proper
disclosures are made for changes, if any ADs-
- Reasonable and prudent judgment and estimates were made so as to give
a true and fair view of the state of affairs of the Bank at the end of
the financial year and the profit of the Bank for the year.
- Proper and sufficient care was taken for maintenance of adequate
accounting records in accordance with the provisions of applicable laws
governing banks, in India ADs- and
- The accounts have been prepared on a going concern basis.
11. CHANGES IN THE BOARD OF DIRECTORS
During the year 2013-14, the following changes took place in the Board
Shri S.D. Dhanak ceased to be Director w.e.f. 21st July 2013.
Shri Narendra Singh, Chairman ACY- Managing Director superannuated on
30th September 2013.
Dr N.K. Drall resigned from Directorship w.e.f 15th November 2013.
Dr. D.S. Patel, Shareholder''s Director ceased to be Director w.e.f 1st
Dr Rajkumar Agrawal, Shareholder''s Director ceased to be Director
w.e.f. 1st February 2014.
Shri C.VR. Rajendran, Executive Director appointed as Chairman ACY-
Managing Director of Andhra Bank w.e.f 13.12.2013.
Ms Kamala Rajan, RBI Director superannuated on 28th February 2014.
Dr. S.U. Deshpande''s Directorship is kept in abeyance w.e.f 16th
March2014, by Government of India.
Shri R.L. Saydiwal was appointed as Director w.e.f. 21st July 2013.
Shri R. Athmaram was appointed as Executive Director w.e.f 07th August
Shri Sanjeev Jain was appointed as Director w.e.f. 19th August 2013.
Shri Sushil Muhnot was appointed as Chairman ACY- Managing Director w.e.f
Shri R.K.Gupta was appointed as Executive Director w.e.f 31st December
Dr S.Rajagopal was appointed as RBI Director w.e.f. 13th March 2014.
The Board of Directors place on record their sincere appreciation for
the valuable contribution made by the outgoing Directors.
The Board of Directors wishes to express sincere gratitude to the
Government of India, the Reserve Bank of India, the Securities and
Exchange Board of India, Insurance Regulatory and Development
Authority, Indian Banks'' Association and Stock Exchanges and CDSL for
their valuable advice and support ADs- to the customers and shareholders
for their patronage ADs- to the correspondents and associates for their
co-operation and to all the members of staff of ACI-Mahabank Family ACI-
for their unstinted commitment and contribution to the overall development
of the Bank.
For and on behalf of the Board of Directors
Pune (S. Muhnot)
Date : 26.05.2014 Chairman and Managing Director