1.1 a) Initial matching of entries in respect of Inter Branch
 transactions has been done up to March 2011 for the purpose of
 reconciliation, which is an ongoing process.
 
 b) Balancing of subsidiary ledgers/registers and reconciliation with
 general ledgers are in progress at some branches. Outstanding entries
 in some heads of account including demand drafts payable, drafts paid
 ex-advice, suspense accounts, dividend/ interest warrants, refund
 orders paid and clearing adjustments between service branches and
 participating branches in clearing are in the process of
 reconciliation/ adjustments.
 
 c) Balances with Reserve Bank of India/ other banks have been
 reconciled except certain entries under process of reconciliation.
 
 d) The consequential impact on the accounts of all as stated above [in
 a, b & c] is not ascertainable pending reconciliation / balancing /
 adjustment.
 
 1.2 Provision on standard assets has been given effect in the accounts
 according to revised RBI guidelines as under:
 
 a) 0.25% of the outstanding in the direct advances to Agriculture and
 SME Sector
 
 b) 1.00% of the outstanding in Commercial Real Estate (CRE) Sector
 
 c) 2.00% of the outstanding in Housing Loans @ teaser rates.
 
 d) 0.40% of the outstanding in all other advances [i.e. except a, b & c
 above.]
 
 1.3 Provision on all assets other than standard assets has also been
 given effect in the accounts in accordance with the IRAC norms issued
 by RBI.
 
 1.4 The classification of advances and provisioning there-against in
 case of 289 Un-audited branches have been incorporated as certified by
 the branch mangers.
 
 1.5 The Bank has transferred Rs. 183.49 crore (Previous year Rs.
 153.38 crore) to Statutory Reserve out of profit of. 611.63 crore for
 the year (Previous year Rs. 511.25 crore) & Rs. 2.28 crore (Previous
 year Rs. 16.40 crore) to Capital Reserve (Net of taxes and Transfer to
 Statutory Reserve) from the profit on sale of investments held under
 HTM Category. The Bank has transferred. 22.00 crore in Special Reserve
 created u/s 36 (1) (viii) of the Income Tax Act, 1961 (Previous Year
 Rs. 15 crore). The Bank has also transferred Rs. 318.33 crore to
 Revenue Reserve (Previous Year Rs. 259.36 crore) after proposed
 dividend (inclusive of dividend tax) of. Rs. 85.53 crore (Previous Year
 Rs. 67.11 crore).
 
 18.6 Non-banking asset (land) acquired in satisfaction of claim
 amounting to Rs. 9.86 crore (Previous Year Rs. 9.86 crore) is pending
 for registration.
 
 @Bank has issued 4,65,65,874 equaity shares of Rs. 10/- each at a
 premium of Rs. 105.75 to GOI on preferential basis on 25.03.2011
 
 v. The Bank has amortized Rs. 28.28 crore during the year (Previous
 year Rs. 33.35 crore) for securities classified under Held to
 Maturity category, in terms of accounting policy 17.2 and the amount
 has been charged to Profit and Loss Account by reducing value of the
 respective securities to that extent.
 
 vi Bank has not charged depreciation amounting to Rs. 6.97 crore due to
 shifting of investment from AFS category to HTM category.
 
 vii In accordance with the guidelines issued by RBI, the bank has
 shifted securities within the categories during the year. The
 consequential depreciation amounting to Rs. 22.21 crore (previous year
 Rs. 25.45 crore) on account of shifting securities from Available for
 Sale category to Held to Maturity category has been charged to
 Profit & Loss Account by reducing book value of these securities.
 
 During the year, Bank has changed method of amortisation of premium on
 securities from Constant Yield Method to Straight Line Method. Due to
 this change, the amount of amortisation for the financial year 2010-11
 has reduced from Rs. 32.64 cr. to Rs. 28.28 cr.  This has resulted in
 increase in the profit for the financial year 2010- 11 by Rs. 4.36 cr.
 
 viii The Bank has investment of Rs. 21.72 crore (Previous year Rs.
 21.72 crore) in two Regional Rural Banks (RRBs) sponsored by the Bank.
 This includes Investment of Rs. 20.32 crore (Previous Year Rs. 20.32
 crore) by way of Share Capital deposits, towards recapitalisation of
 the RRBs. Diminution in value of Investment in one of the RRB has not
 been recognized as the said investment has been valued at cost in
 accordance with the RBI guidelines.
 
 1.6 Derivatives:
 
 a) Forward Rate Agreement/ Interest Rate Swap
 
 The Bank has not undertaken Forward Rate Agreement/Interest Rate Swap
 transanction during the year. Therefore no separate disclosure is
 given.
 
 b.  Exchange Traded Interest Rate Derivatives:
 
 The Bank has not undertaken Exchange Traded Interest Rate Derivatives
 transanction during the year. Therefore no separate disclosure is
 given.
 
 c.  Disclosures on risk exposure in derivatives:
 
 i.  Qualitative disclosure
 
 Bank has not undertaken any overnight interest rate swap (OIS)
 transaction during the year.
 
 # Includes Rs. 5.65 Cr (Previous Year Rs. 4.12 Cr.) towards provision
 of FITL (NPA).
 
 e. Provision Coverage Ratio (PCR)
 
 As on Balance Sheet Provision Coverage Ratio is 74.62 calculated as per
 RBI circular no. RBI2009-10/240 DBOD.NO.BP.BC.64/21.4.2009- 10 dated
 o1.12.2009. In terms of RBI circular no. DBOD.NO.BP.BC.  87/21.04
 /2010-11 April 21, 2011 on PCR the Bank is not required to segregate
 any amount in to counter cyclical provisioning buffer.
 
 1.7 Risk Category wise country exposure:
 
 In respect of Foreign Exchange transactions, where the Banks net
 funded exposure computed as per the guidelines of the RBI with each
 country exceeded 1% of the total assets of the Bank, the Bank is
 required to make the provision. Since, Banks net funded exposure in
 any country does not exceed 1% of total assets, no provision (Previous
 year Nil) is made.
 
 Single Borrower Limit (SGL), Group Borrower Limit (GBL) exceeded by the
 Bank
 
 During the year 2010-11, the Bank has sanctioned limit of Rs. 575
 crores to one of the borrower (M/s Chhatisgarh Co operative Marketing
 Federation) where outstanding as on 31.03.2011 was Rs. 578.65 crores;
 due to interest application for March 2011. Interest has been
 subsequently paid on 06.04.2011 & account was within the prudential
 credit exposure limit in respect of single borrower.
 
 1.8 Reserve Bank of India did not subject the Bank to any penalty
 during the year.
 
 1.9 Provision for Income Tax:
 
 During the year, pursuant to various assessments / appellate /
 rectification orders, additional provision for Income Tax pertaining to
 earlier years has been made amounting to Rs. 48.58 crore (previous year
 Rs. 10.75 crore written back) and charged to the Profit & Loss Account
 for the year.
 
 The property belonging to the Bank was revalued during the year 2005-06
 and written down value of the revalued property as on 31.03.2011 is
 Rs.14.38 crore. (Previous Year Rs. 14.63 crore).
 
 1.10 The advances covered by Bank/ Govt. Guarantee [shown in Schedule
 - 9 Para B (ii)] include Rs. 3696.67 crore [Previous Year Rs. 2686.16
 crore] guaranteed by various State Governments.
 
 1.11 Two plots of land at Gandhidham, which are in the possession of
 the bank since long, have been included in the value of premises at
 their present market value (based on valuation reports obtained). The
 net amount added to the premises Rs. 1.57 crore has been credited to
 Capital Reserves (Revaluation Reserve). The same was done prior to
 April 1st, 2009. No assets in this block have been revalued during the
 current year 2010-11.
 
 1.13 DISCLOSURE AS PER ACCOUNTING STANDARDS (AS):
 
 a) Disclosure as per AS 5:
 
 There were no material prior period income/expenditure items requiring
 disclosure under AS - 5.
 
 b) Disclosure as per AS 9:
 
 Certain items of income are recognised on realization basis as per
 Accounting Policy as stated at point no. 17.6.b.
 
 c) Disclosure as per AS 10:
 
 The Bank has not revalued any of its fixed assets during the year.
 
 d) Disclosure as per AS 11:
 
 Net income on account of exchange differences credited in the Profit
 and Loss account for the year is Rs. 52.35 crore (previous year: Rs.
 33.26 crore).
 
 i) Provision has been made for Employees Benefits viz; Pension,
 Gratuity, Leave Encashment and other Employees benefits in accordance
 with AS-15 (revised) on the basis of actuarial valuation.  In addition,
 a sum of Rs. 21.57 crore (Previous year 21.58 crore) has been charged
 to Profit and Loss account during the year, being 1/5th of transitional
 Liability as on 31st March 2007, in compliance with AS-15 (revised) on
 Employees Benefits notified by the ICAI.  The amount of unrecognized
 transitional liability is Rs. 21.58 crore (Previous year Rs. 43.15
 crores).
 
 ii) During the year, the Bank reopened the pension option for such of
 its employees who had not opted for the pension scheme earlier.  As a
 result of exercise of which by (5448 employees), the bank has incurred
 a net liability of Rs. 471.56 crore. Further, during the year, the
 limit of gratuity payable to the employees of the banks was also
 enhanced pursuant to the amendment to the Payment of Gratuity Act,
 1972. As a result the gratuity liability of the Bank has increased by
 Rs. 79.96 crore.
 
 In terms of the requirements of the Accounting Standard (AS 15),
 employee benefits, the entire amount of Rs. 551.52 cr (i.e. Pension Rs.
 471.56 cr + Gratuity Rs. 79.96 cr) is required to be charged to Profit
 & Loss Account. However RBI has issued a circular no DBOD.No.
 BP.BC.80/ 21.04.018/2010-11 on Re-opening of Pension Option to
 Employees of Public Sector Banks and Enhancement in Gratuity Limits -
 Prudential Regulatory Treatment dated 9th February, 2011. In accordance
 with this provision of said Circular, the Bank would amortize the
 amount of Rs. 433.88 cr over a period of 5 years.
 
 Accordingly, Rs. 86.77 cr (representing 1/5th of Rs. 433.88 cr ) has
 been charged to P & L Account. In terms of the requirements of the
 aforesaid RBI circular, the balance amount carried forward i.e.  Rs.
 347.11 cr (Pension Rs. 283.14 cr plus Gratuity Rs. 63.97 cr) does not
 include any employee relating to separated/ retired employees.
 
 Had such a circular not been issued by the RBI, the profit of the Bank
 would have been lower by Rs. 347.11 cr pursuant to application of the
 requirements of the AS 15.
 
 Notes:
 
 1.  Segment Results are after adjustment on account of Inter Segment
 Cost, which has been considered on the basis of Transfer Price
 mechanism decided by the Bank.
 
 2.  Assumed Inter Segment Assets, Liabilities and Revenue have been
 ignored.
 
 3.  Treasury Operations consist of entire treasury investment portfolio
 of the Bank.
 
 4.  Unallocated liabilities include Capital and Reserves.
 
 In compliance with Accounting Standard 18 issued by ICAI and RBI
 guidelines, details pertaining to Related Party Transactions are as
 under:
 
 *There were no diluted potential equity shares
 
 Consolidated Financial Statements - Accounting Standard 21:
 
 The Bank is not having any subsidiaries, therefore, this accounting
 Standard does not apply.
 
 Taxes on Income : Accounting Standard 22:
 
 The Bank has complied with requirements of AS 22 on Accounting for
 Taxes on Income issued by ICAI and accordingly, deferred tax assets
 and liabilities are recognized.
 
 Accounting for Investments in Associates in Consolidated Financial
 Statements : Accounting Standard : 23
 
 As on the Balance Sheet Date there is no such associate of the Bank.
 
 Discontinuing Activities - Accounting Standard 24: No activity has been
 discontinued in the Bank during the year.
 
 Accounting Standard 28: In the opinion of the Management, there is no
 impairment to its assets, to which Accounting Standard- 28 is
 applicable.
 
 Disclosure in terms of Accounting Standard 29 on provisions, contingent
 liabilities and contingent assets.
 
 Item Nos (I) to (V) of the Schedule 12 of the balance sheet on
 contingent liabilities, reflect the various types of contingent
 liabilities categorized according to their nature. These amounts are
 estimated on the basis of documents related to the basic contracts or
 claims made. Outflow on account of these contingent liabilities would
 depend upon the outcome of disposal of litigations by the respective
 judicial authorities, execution of contracts, invocation of guarantees,
 devolvement of LCs, settlement of claims etc.
 
 Floating Provisions
 
 Bank does not have any floating provisions.
 
 18.24 Draw Down from Reserves
 
 Bank has not drawn any amount from the Reserves during the year.
 
 Disclosure of Letter of Comforts (LOCs) issued by bank to a foreign
 regulator
 
 Since the Bank does not have any subsidiary/branch in overseas, Bank
 has not issued any Letter of Comfort [LOC] to meet the requirement of
 foreign regulator.
 
 Bank has received Rs. 9.21 crore (Previous year Rs. 8.33 crores) as
 fees/commission from bancassurance business.
 
 Bank has set a target to cover 299 villages with population above 2000
 during 2010-11 under Financial Inclusion Plan (FIP). Against the FIP
 projection of 299 villages, Bank has covered 310 villages during
 2010-11, out of which 303 villages have been covered through the
 Business Correspondents (BCs) model and 7 villages have been covered by
 opening of Branch / Satellite Offices.
 
 18.35 Bank has not sponsored any SPVs.
 
 18.36 The Bank has engaged M/s Tata Consultancy Services (M/s TCS) as
 the Application Service Provider (ASP) for implementation of Fl Plan
 for a period of 3 years. M/s Society for Educational Welfare & Economic
 Development (SEED) has been engaged by M/s Tata Consultancy Services
 (TCS), as Business Correspondents (BC) for Banks Financial Inclusion
 Project, in consultation with the Bank for covering the Fl villages all
 over India. The Bank has engaged M/s A Little World (M/s ALW) as
 Technology Service Provider and M/s Zero Microfinance & Savings Support
 Foundation (M/s ZMF) for the implementation of the Pilot Project in the
 UT of Dadra & Nagar Haveli.
 
 18.37 Previous years figures have been regrouped/reclassified/re-
 arranged, wherever necessary, to make them comparable with the current
 years figures.