1.  We have audited the attached Balance Sheet of BANK OF INDIA as at
 31st March, 2011, the Profit and Loss Account and the Cash Flow for the
 year ended on that date annexed thereto in which are incorporated the
 returns of 20 branches (including Treasury Branch) audited by us, 2796
 branches audited by other auditors and 24 foreign branches audited by
 local auditors. The branches audited by us and those audited by other
 auditors have been selected by the Bank in accordance with the
 guidelines issued to the Bank by the Reserve Bank of India. Also
 incorporated in the Balance Sheet and Profit and Loss Account are the
 returns from 674 branches which have not been subjected to audit.
 These unaudited branches account for 1.23% percent of advances, 2.43%
 percent of deposits, 0.97% percent of interest income and 2.48% percent
 of interest expenses.  These financial statements are the
 responsibility of the Banks management. Our responsibility is to
 express an opinion on these financial statements based on our audit.
 
 2.  We conducted our audit in accordance with the auditing standards
 generally accepted in India. Those standards require that we plan and
 perform the audit to obtain reasonable assurance about whether the
 financial statements are free of material misstatements. An audit
 includes examining, on a test basis, evidence supporting the amounts
 and disclosures in the financial statements.  An audit also includes
 assessing the accounting principles used and significant estimates made
 by the management, as well as evaluating the overall financial
 statement presentation. We believe that our audit provides a reasonable
 basis for our opinion.
 
 3.  The Balance Sheet and the Profit and Loss Account have been drawn
 up in Forms “A” and “B” respectively of the Third Schedule to the
 Banking Regulation Act, 1949.
 
 4.  Without qualifying our opinion, we draw attention to Note no.4(a)
 of Schedule 18 to the financial statements, which describes deferment
 of pension and gratuity liability of the bank to the extent of Rs.
 2112.89 crores pursuant to the exemption granted by the Reserve Bank of
 India to the public sector banks from application of the provisions of
 Accounting Standard (AS) 15, Employee Benefits vide its circular no.
 DBOD. BPBC/80/21.04.018/2010-11 dated February 09, 2011 on Re-opening
 of Pension Option to Employees of Public Sector Banks and Enhancement
 in Gratuity Limits – Prudential Regulatory Treatment.
 
 5.  Subject to the limitations of the audit indicated in paragraph 1
 above and as required by the Banking Companies (Acquisition and
 Transfer of Undertakings) Act, 1970, we report that:
 
 a) In our opinion and to the best of our knowledge and according to the
 information and explanations given to us and as shown by the books of
 the Bank:
 
 (i) The Balance Sheet read together with the Significant Accounting
 Policies and Notes forming part of Accounts is a full and fair Balance
 Sheet containing the necessary particulars, and is properly drawn up so
 as to exhibit a true and fair view of the affairs of the Bank as at
 31st March, 2011;
 
 (ii) The Profit and Loss Account read together with the Significant
 Accounting Policies and Notes forming part of Accounts shows a true
 balance of Profit in conformity with accounting principles generally
 accepted in India for the year covered by the accounts; and
 
 (iii) The Cash Flow Statement gives a true and fair view of the cash
 flows for the year covered by the Statement.
 
 b) We have obtained all the information and explanations which to the
 best of our knowledge and belief were necessary for the purposes of our
 audit and have found them to be satisfactory.
 
 c) The transactions of the Bank which have come to our notice have been
 within the powers of the Bank.
 
 d) The returns received from the offices and branches of the Bank have
 been found adequate for the purposes of our audit.
 
 
 
 For Sundaram & Srinivasan             For Agarwal & Saxena
 Chartered Accountants                 Chartered Accountants
 (Firm Reg. No. 004207S)               (Firm Reg. No. 002405C)
 
 
 (C. Naresh)                           (Anil K. Saxena)
 Partner                                Partner
 M. No. 28684                           M. No. 71600
 
 
 
 For Karnavat & Co.                    For L.B. Jha & Co.                   
 Chartered Accountants                 Chartered Accountants                 
 (Firm Reg. No. 104863W)               (Firm Reg. No. 301088E)                
 
 (Sunil Hirawat)                       (K.K. Bhanja) 
 Partner                               Partner 
 M. No. 33951                          M. No. 14722 
 
 
 
                      
 For Sankaran & Krishnan              For Chaturvedi & Shah
 Chartered Accountants                Chartered Accountants
 (Firm Reg. No. 003582S)              (Firm Reg. No. 101720W)
 
 
 (S. Chandran)                        (H.P. Chaturvedi)
 Partner                              Partner
 M. No. 8646                          M. No. 33523
 
 
 
 Mumbai, 25th May, 2011