Dear Shareholders,
 
 It gives me immense pleasure to present the performance of your Bank
 for the year ended March 31,2012. 
 
 During the financial year, the macroeconomic undercurrents of high
 inflation and hardening interest rates had its impact on the economy.
 Following two back-to-back years of robust 8.4per cent GDP growth, the
 pace of economic expansion slackended to 6.9 per cent in 2011-12. The
 pace of gross fixed capital formation was negative at 0.2 per cent
 during April. December 2011 as against 8.9 per cent in April-December
 2010. The shares of aggregate capital formation, thus, dropped to 30.6
 per cent of GDP from 32.8 per cent. Corporate Investments dried up and
 the situation is expected to improve slowly in 2012.13.
 
 Against the above backdrop, I would like to given and overview of the
 Bank''s performance in important parameters.
 
 Business and Financial Achievements
 
 The overall Business of the Bank Crossed the Rs 200,000 crore mark
 during the year to Rs 211,988 crore, growing by 16.8 per cent or Rs
 30,458 crore. Deposits of the Bank increased by Rs 15000 crore or 14.2
 per cent to reach Rs 120,804 crore. Credit growth expanded by 20.4 per
 cent or Rs 15,458 crore during the year to Rs 91,184 crore.
 
 The Operating profit of your Bank has improved to Rs 3463 crore while
 Net Profit has grown to Rs 1747 crore.
 
 The Networth of your Bank increased to Rs 9637 crore and the capital
 Adequacy Ratio under Base II was at 13.47 per cent with Tier I capital
 at 11.13 per Cent and Tier II at 2.34 per cent. The Bank has head room
 available to the tune of Rs 7546.41 crore to raise Tier II bonds.
 
 As always, your Bank is in the forefront to fulfill its social
 obligations, priority sector lending has increased by Rs 4057 crore to
 Rs 30027 crore, Constituting 41.54 per cent of the Net Adjusted Bank
 Credit, while Agriculture lending rose by Rs 2306 crore to Rs 13354
 crore as on March 31,2012.
 
 Your Bank has 72 specialised branches across various zones catering to
 the SME sector; the SME portfolio increased by Rs 486 crores to Rs
 10161 crore.
 
 Earnings per share (EPS) at Rs 39.57 and Book value per share at Rs
 214.94 reflect significant improvement over the previous year''s levels
 of Rs 38.79 and Rs 184.44 respectively.
 
 Return on Equity was at 18.73 per cent in the current financial year.
 
 Towards reinforcing and extending the reach to the underbanked and
 unbanked areas, your Bank opende 95 branches and 152 ATMs (including
 off-site ATMs) in the current year to touch 1958 delivery points and
 1260 ATMs.
 
 Your Bank has international presence in singapore and Sri Lanka.
 Besides, your Bank has correspondent banking arrangements with 188
 banks in 69 countries.
 
 The awards and accolades received by your Bank are testimony to the
 efforts and initiatives taken, ot remain highly customer focused and
 extending the reach to the unbanked. it also reflects how the Bank has
 sucessfully pursued business opportunities while continuing to fullfill
 its social responsibilities.
 
 - Ranked First in Strength and soundness, second in profitability and
 Efficiency for FY 2010-11 by Financial Express and Emst & Young Survey;
 Overall Bank was ranked THIRD BEST among PSBs
 
 - Golden peacock innovative product / service award in recognition of
 contribution to promotion of SHGs
 
 - SKOCH Challenger Award 2010. Banking for outstanding contribution in
 providing banking services to the unreached village through various
 financial inclusion initiatives.
 
 - SKOCH Financial Inclusion Award -2012for completion of 100%
 Financial Inclusion in UT of Puducherry
 
 -- Dun & Bradstreet Banking award 2011 for Best Asset Quality
 
 -- Best Risk Master Award for Public Sector Bank category from FIBAC
 at the FICCI - IBA conference
 
 -- Outlook Money Awards 2011 for Best Education Loan Provider
 
 -- CNBC - TV 18 award for the Best Public Sector Bank in mid size
 category for superior quality of assets, profitability, efficiency &
 productivity
 
 -- Adjudged third among the Public Sector Banks as the Best Service
 Brand by Economic Times Brand Equity
 
 -- Listed among top 150 banks for best ROA as per Banker magazine.
 
 I am also happy to inform you that the Board of Directors of your Bank
 have declared a dividend of 75 per cent.
 
 The equity markets reposed confidence in your Bankas seen by the
 increase in share price to Rs 244.00 as at March 31,2012 from Rs 232.45
 on March 31,2011.
 
 Your Bank is in the forefront with regard to financial inclusion and
 during the year, all the 1522 villages with population above 2000 were
 covered through various delivery models like Smart Card based Business
 Correspondents, Banking Service Centers, brick and mortar branches and
 Mobile Branch/Van. Your Bank has also opened 50 ultra small branches in
 villages with population above 2000 under Financial Inclusion.
 
 In the Union Territory (UT) of Puducherry, where your Bank is the SLBC
 Convenor, 42 villages with population above 2000 and 25 villages with
 population below 2000 were provided with banking services under
 Financial Inclusion Plan. UT of Puducherry has become the first State
 in the country to provide banking services to all the villages
 including villages with a population below 2000, under Financial
 Inclusion Plan.
 
 Several new initiatives were also taken by your Bank during the year as
 a part of its commitment to customers and stakeholders facilitating
 convenience banking.
 
 -- WAP (Wireless Access Protocol) enabled Mobile Banking
 
 -- On line Loan Application for Home Loan and Education loan
 
 -- Demand Drafts payable At Par at all Branches
 
 -- SMS is being sent to customers on weekly balance in running
 accounts to the registered Mobile Number in their CIF informing the
 weekend balance (as on Saturday) in their SB / CA/ OD/CC accounts.
 
 -- e-payment module for receipt of Customs Duty through IceGate , CST
 and DVAT for Dept, of Trade & Taxes, Government of NCT Delhi, Karnataka
 Commercial Taxes.
 
 -- Cheque Truncation Scheme (CTS) implemented at Coimbatore &
 Bangalore, in addition to Delhi and Chennai
 
 -- 85 biometric ATMs are in operation including operations by SHG
 Members.
 
 It is the confidence of our 26 million customers and stakeholders which
 has inspired us to better our performance year after year.  Looking
 Forward
 
 The financial year 2012-13 is going to be quite challenging with global
 economic environment still remaining uncertain and concerns about
 rising current account and fiscal deficit persisting.
 
 However, we will continue to make concerted and conscientious efforts
 to promote business growth through excellence by continuously working
 on our people and processes. In this journey of scaling newer peaks,
 our intent would be optimizing our stakeholders''value with your
 continued patronage.
 
 As your Bank enters the 106th year of existence, I am confident that
 with the continued support and patronage of the shareholders,
 customers, employees and well wishers as well as the Government of
 India & Reserve Bank of India, your Bank will continue its march
 towards excellence and will be a force to reckon with in the Industry.
 
 With best wishes
 
 Yours sincerely
 
 
 
 T M Bhasin
 
 Chairman and Managing Director