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State Bank of India Directors Report, SBI Reports by Directors
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State Bank of India

BSE: 500112|NSE: SBIN|ISIN: INE062A01020|SECTOR: Banks - Public Sector
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Directors Report Year End : Mar '19    Mar 18

A. PERSONAL BANKING

1. Home Loans

As on 31st March 2019, the Home Loan portfolio of your Bank was the largest in the country, with a market share of more than 34.51% amongst All Scheduled Commercial Banks (ASCB). The total Home Loan stood at Rs.4,00,377 crore, which was 20.11% of your Bank’s domestic advances.

Affordable Housing was a key driver of growth in the overall Housing sector, based on the Government’s thrust to bridge the massive Demand-Supply gap of dwelling houses in India, along with the relaxation of the CLSS (Credit Linked Subsidy Scheme) norms under Prime Minister’s Awas Yojana (PMAY), covering more beneficiaries, Government has also extended the PMAY MIG Scheme up to 31st March 2020. As of 31st March 2019, State Bank of India has 64.46% of its Home Loan portfolio under Affordable Housing. Your Bank was recognised by the National Housing Board (NHB) as the Best Home Loan provider in the country, under the PMAY MIG category, for FY2017-18.

During FY2019, various initiatives were taken by your Bank to give an additional boost to its Home Loan portfolio, some of which are:

- Home Loans on YONO was a significant step towards digitisation and provided the registered YONO customers with 24*7 access to Home Loan needs, such as exploring SBI Home Loan products, calculating eligibility, and getting instant Inprinciple approval. To meet the personal needs of existing Home Loan customers, Insta Home Top-Up Loan was also introduced on YONO.

-    Sanctioning of Home Loans and Home related products from non-BPR centre branches through centralised Rural Assets Credit Centres (RACCs), and Loan Processing Cells (LPCs), has brought about uniformity in processes and better quality of underwriting, resulting in pan-India growth of quality assets. The overall fresh NPA during FY2019 was below 1% of the total Home Loans portfolio.

-    In order to help and support the flood affected people of Kerala, within a month of the calamity, your Bank introduced Home Loan Schemes for Repair and Renovation within the Kerala Circle on softer terms, irrespective of category, gender, LTV ratio and risk score of the customers.

-    Your Bank introduced niche products such as ‘SBI Smart Home Top-Up’for existing Home loan customers; SBI ‘Wealth’for HNI / High-end customers; and Flexible Margin Schemes for real-estate developers.

-    Your Bank is leveraging its vast branch network and the strength of its committed staff, with the latest state-of-the-art technology to improve the Home Loan journey of the customer. Namely making it faster, more transparent and easier. Your Bank continues to work towards being the first choice Home Loan provider of customers.

2. Auto Loans

Your Bank is helping with upgrading the living standards of its customers by providing auto loans at competitive rates, and by making owning a car an affordable proposition. The auto loan products of your Bank are available in many variants to suit the requirements of various customer segments viz. - salaried, businessmen, self-employed, professionals, senior citizens, NRIs, agriculturists and existing borrowers, amongst others. Multi-channel sourcing of proposals and quick TAT has made the auto loan products highly popular. This has helped your Bank to increase its penetration in financing cars sold by various manufacturers such as Maruti, Hyundai, TATA Motors, to name a few. The Auto Loan portfolio reached a level of Rs.71,884 crore by FY2019, and the market share of Your Bank in Auto Loans rose from 34.97% in FY2018, to 35.45% in FY2019, amongst All Scheduled Commercial Banks (ASCBs). Additionally, State Bank of India plans to start financing high-value super bikes, a new and fast emerging segment.

3.    Education Loans

Education is the key prerequisite for creating human capital, as it helps in developing skilled and productive human resources. Loans provided for this purpose contribute to the development of the nation and is a growth driver for any economy. Therefore, the financing of up to Rs.10 lakh under Education Loans is considered as Priority Sector Advance. Your Bank takes pride in being the largest Education Loan provider in the country, with a market share of 30%. During FY2019, it helped more than 66,947 meritorious students to realise their dreams by providing financial assistance to the tune of Rs.6,635 crore. Out of this, 35% of the loans were extended to girl students. To broaden the scope of Education Loans, book quality business and enhance customer satisfaction, your Bank has taken following steps:

-    Shortlisted 158 top-rated, premier and reputed institutions to extend Education Loans under the Scholar Loan scheme at relaxed norms and concessional interest rates.

-    Door-step services were extended for sourcing high-value education loan applications for studying abroad at select centres.

-    To ensure better tracking of the loan applications and faster sanctioning of loans, your Bank’s Loan Origination System was integrated with Vidya Lakshmi Portal (VLP) of the Government of India.

4.    Personal Loans

Personal Loan is amongst the most popular products of your Bank, and your Bank is a leader in this market segment. Your Bank was aggressively catering to the needs of salaried class (both government and private), pensioners and self-employed/ other customers. During FY2019, your Bank has provided Personal Loans to more than 15 lakh customers, amounting to Rs.56,873 crore, while maintaining a market share of around 30%. With a much higher rate of return on parameters such as ROA and RORWA, your Bank’s delinquency under this segment is one of the lowest in the industry. The products are delivered through multiple channels such as Branches, Internet Banking and through YONO. Utmost caution in selection of borrowers and careful due diligence has made it possible for your Bank to achieve much lower delinquencies despite aggressive portfolio growth.

Personal Loans for e-Commerce Purchases:

Your Bank provides EMI based loans to pre-selected elite customers for purchase of consumer durable goods worth up to Rs.1,00,000 from online shopping portals such as Flipkart and Amazon on a real time basis. Online e-commerce financing under tie-up with Flipkart was launched in May 2018 and with Amazon in October 2018. The portfolio is 19,974 accounts with an outstanding of Rs.19 crore as on March 2019.

SBI Debit card holders were empowered to fulfil their shopping needs on POS enabled swipe machines with an EMI facility, given to the pre-selected ones for purchasing consumer durable goods from the approved shops, mall, stores, and show rooms worth up to Rs.1 lakh. The facility was launched during the latter part of FY2019.

5.    Liability and Investment Products

The overall P-Domestic CASA Deposits of your Bank has grown from Rs.8,36,294 crore as on FY2018 to Rs.9,16,442 crore as on FY2019, registering a growth of Rs.80,148 crore (9.58% annualised). The CASA improved to 48.49% as on FY2019, compared to 48.23% as on FY2018.

6.    Corporate and Institutional Tie-ups for Salary Package

Salary Accounts of employees of Corporates, Central/State Government establishments, Defence, Para Military and, Police personnel amongst others, are opened/serviced through Key Accounts Managers (KAMs), who provide personalised service along with a bouquet of products under the Corporate Salary Package (CSP) at the customer’s door step. The total Salary Account customer base for FY2019 reached 145.93 lakh accounts, registering a growth of 22% over FY2018.

7.    Digital Personal Loan Offerings

While offering products on multiple platforms for portfolio growth with higher profit margins, we have kept in mind the ease of Banking for our Customers, and have implemented following digital products:

-    On the YONO Platform, your Bank is providing Pre-Approved Personal Loans (PAPLs) to pre-selected customers through four product lines, viz., Pre-approved Xpress Credits up to Rs.5 lakh, Pre-approved Pension loans up to Rs.2.5 lakh, Xpress Credit Insta Top-up up to Rs.3 lakh, and Pre-Approved Personal Loans (PAPLs) up to Rs.2 lakh to CSP and Non-CSP customers.

-    Xpress Credit Insta Top-up loans on INB Platform: Top-up loans up to Rs.3 lakh are being offered to preapproved Xpress Credit customers through INB platform.

-    Tatkal e-Personal Loan: Loans up to Rs.1 lakh are being offered to cater to the needs of pre-selected unserved and under- served nonsalaried customers, based on selected parameters. This product was launched in May 2018 and has a portfolio of 27,853 accounts worth Rs.122 crore as on March 2019.

-    Personal loans were extended against security of Sovereign Gold Bonds of Government of India.

8. NRI Business

As on 31st March 2019, your Bank has around 37 lakh NRI Customers, who are being catered to by 93 dedicated NRI branches in India and a well-connected network of foreign offices. We also have correspondent banking relations with 234 global Banks and tie- ups with 55 exchange houses and six Banks (in the Middle-East) to facilitate remittances. The Indian diaspora, spread across the globe, has always reposed immense trust on us. As a result, a quarter of their deposits (within the Indian Banking system) is with us.

Your Bank has launched the following products/services in FY2019 for the benefit of its NRI clientele:

-    SBI Tax Savings Scheme for NRIs (NRO Deposits) was introduced in which customers can avail Tax benefits under section 80C of Income Tax Act, 1961 (minimum tenor of deposit is 5 years and tax-relief is available up to Rs.1,50,000 per Financial Year).

-    Missed call and SMS Banking facilities were launched for NRIs, in which customers can get their latest balance and mini statements of their accounts via SMS, just by giving a missed call on a predefined number. This is especially useful for customers who are not using Internet Banking facilities. Customers can also block or restrict ATM card usage through this functionality.

-    NRIs can now plan and secure retirement with the National Pension System (NPS) scheme. The product is now available to all SBI NRI customers. They can open and maintain NPS account through their Internet Banking portal as well.

-    SBI Wealth, the wealth management initiative of your Bank, which offers a platform to create, preserve and grow wealth, is now available to NRI clientele from Gulf Cooperation Council Countries.

9. Wealth Management Business

Your Bank’s Wealth Management Services are now made available at 44 Centres with 121 Wealth Hubs, four e-Wealth Centres and a Global e-Wealth Centre by adding 31 new Centres and 45 new Wealth-Hubs during the year. The Wealth-Hubs are managed by a team of dedicated Relationship Managers and Investment Counsellors who have in-depth knowledge on products and markets, along with Senior Internal Officials for operational roles.

For greater connect and visibility, your Bank re-branded the Wealth Management Business as ‘SBI Wealth’, which was earlier known as ‘SBI EXCLUSiF’.

An open Investment Platform, with a state-of-the-art technology and right selling approach based on Risk Profiling, provides the best possible experience to the Bank’s clients by offering exclusivity in its services and benefits.

Your Bank added a new e-Wealth Centre at Kolkata during the year. The e-Wealth Centres, with extended banking hours, are equipped with transaction execution facilities over voice and video calls. With an endeavour to provide a best in class holistic experience to clients, your Bank has launched a new version of ‘SBI Wealth Mobile App’enabling investment transactions.

During the year, your Bank posted Relationship Managers (NRI Wealth) at Abu Dhabi, Bahrain and Dubai. NRIs residing in Bahrain, Kuwait, Qatar, Sultanate of Oman and UAE are eligible to be on-boarded as Wealth Clients. They have an option to access Wealth Management Services either through e-Wealth Centres or Wealth Hubs during their visit to India. Your Bank has also opened a state-of-the-art Global e-Wealth Centre at Kochi for extending services to NRIs.

Your Bank has conducted Signature Investment Conclaves addressed by experts from the Financial Industry and Markets on prevalent market conditions and investment opportunities. These Conclaves were well attended by existing and prospective SBI Wealth Clients.

To commemorate the 3rd Anniversary of SBI Wealth, the Bank conducted a Signature Client Engagement Program at Mumbai to build a deeper and valued relationship with Wealth Clients. It released the 2nd edition of the Financial Planning reference publication during the launch of its 100th Wealth Hub at Coimbatore.

Your Bank’s Wealth Management Business has shown an exponential growth in terms of client acquisition and Assets Under Management during the financial year. The number of Clients increased from 24,168 in March 2018 to 55,502 in March 2019 and AUM reached Rs.30,270 crore against Rs.14,284 crore during the period.

B. ANYTIME CHANNELS

As on

ATMs

Kiosks

ADWMs

Total

31st March 2016

42,733

1,231

5,760

49,724

31st March 2017

42,222

986

6,980

50,188

31st March 2018*

51,616

#

7,925

59,541

31st March 2019*

50,757

#

7,658

58,415

# Kiosks are scrapped and not in use * Merged

1.    ATMs/ ADWMs

Your Bank has one of the largest ATM networks in the world with 58,415 ATMs including Automated Deposit and Withdrawal Machines (ADWMs) as on 31st March 2019. To provide 24x7 cash deposit and withdrawal facilities, it has installed 7,658 ADWMs and CDMs.

Nearly, 36% of the financial transactions of your Bank are routed through ATMs/ ADWMs. With a market share of 28.73% (as per RBI Data) in ATM network in India, it transacts 50.81% of the country’s total ATM transactions. On an average, over 1.40 crore transactions per day are routed through your Bank’s ATM network.

Under the Green initiative and cleanliness drive, your Bank has discontinued printing of transaction slips for 43 types of unsuccessful transactions. It has installed solar panels on around 2,400 ATM sites.

Your Bank has set up over 2,200 e-Corners across the country where customers can avail the entire gamut of services through ATMs, ADWMs, SWAYAMs, Check deposit Kiosk, and online banking kiosk.

To ensure safety of ATMs and customers’, coverage under electronic surveillance is being enhanced. Your Bank has covered approximately 13,000 ATMs under e-surveillance as on 31st March 2019, while the next 15,000 ATM sites are slated to commence shortly.

2.    SWAYAMs: Barcode based Passbook Printing Kiosks

Your Bank installed around 3,200 SWAYAMs (Barcode based Passbook Printing Kiosks) during FY2019, making the total number of SWAYAMs deployed cross 17,400 units. Using these kiosks, customers can print their own passbooks using barcode technology. Your Bank has also deployed “Through the Wall” SWAYAMs, offering extended working hours for printing. More than 3.45 crore transactions are recorded at these kiosks per month.

3.    Green Channel Counter (GCC)

GCC installed at all retail branches extend services such as cash withdrawal, cash deposit, funds transfer within State Bank of India, balance enquiry, and Mini Statement. On an average 8.20 lakh transactions are being routed through GCC per day.

4.    Green Remit Card (GRC)

GRC, especially useful for migrant depositors, is a card through which one can remit money using GCC/CDMs/ ADWMs in a specified account of State Bank of India. As a daily average, over 1.50 lakh transactions are being routed through GRC.

5.    Banking on Mobile

YONO Lite - Your Bank’s Mobile Banking App for retail customers, YONO Lite, as it is now known offers Intra and Inter Bank funds transfer (NEFT/RTGS/IMPS/ UPI amongst others.), opening of fixed deposits, e-MOD Accounts and add / manage beneficiaries etc. Additional value-added services such as Aadhaar Linking, Voice Assisted Banking, e-statement subscription/download, Stop / Revoke cheque instructions, and facility to submit Form 15G/ 15H online for TDS exemption and a host of other features are also available.

SBI Anywhere Corporate - Your Bank’s Mobile Banking App for proprietorship firms allows businesses to transfer funds across Banks, open and operate fixed deposit accounts, payment to EPFO, view account statements, schedule transactions, and Recharge/bill payment amongst others. Furthermore, it facilitates large Corporate firms with multiple users and allows business houses to operate accounts, transfer funds through NEFT/ RTGS, make bill payments/supplier payments, authorise e-cheques /e-STDR, open and operate fixed deposit accounts amongst others. With above 141 Lakh registered users, the Mobile Banking channel has processed transactions amounting to Rs.2,74,029 crore.

6. SBI Pay (BHIM)

Your Bank’s Unified Payments Interface based App is an interoperable offering, which provides the convenience of transferring funds across different Bank accounts using - Virtual Payment Address (VPA), Bank Account Number + IFSC and scanning a QR Code. Over 553 lakh users have registered and are availing UPI services, resulting in more than 129 crore transactions, amounting to more than Rs.2.96 lakh crore, processed through the SBI UPI channel during FY2019. Additionally, users have the convenience of making bill payments, travel bookings and ordering food through BHIM SBI Pay making it an all-in-one UPI App. A facility to help donation for a variety of noble causes such as - Clean Ganga Fund and various Chief Minister’s Relief Funds, has also been enabled on the app.

Large multinational corporations have implemented digital payments bandwagon to help achieve a Less Cash India. State Bank of India has partnered with Google India to offer UPI services to the users of their App - Google Pay under the UPI Multi-Bank Integration Model. Consequently, over 312 lakh Google Pay users have linked their Bank accounts with their @OKSBI handle till 31st, March 2019.

SBIePay - Your Bank’s Payment Aggregator

SBIePay, started in March 2014, is the first and only Bank based Payment Aggregator in India. In its essence, SBIePay is a platform for merchants to acquire a Bank agnostic large customer base and provides a bouquet of online payment options to the merchant’s online customers. During last year, SBIePay has witnessed exceptional growth, as a result of an increase in the number of merchants on-boarded, which rose from 125 in FY2018 to 225 in FY2019. Moreover, your Bank has added four new channels to the bouquet of online payment offerings - NEFT, Prepaid Card, UPI, and SBIePay-POS and have made direct integration with INB of other Banks such as HDFC, ICICI, Bank of Baroda, amongst others. This has resulted in a 115% YoY growth in number of transactions. The value of the transactions settled has jumped from Rs.24,487 crore in FY2018, to Rs.38,207 crore in FY2019, leading to an increase in the commission/revenue earned by your Bank. SBIePay has achieved a revenue of Rs.49.68 crore during FY2019, a growth of 54% over FY2018.

7. Digital Banking

The digital payments landscape in India is evolving rapidly and State Bank of India is playing an effective role in building momentum for transforming India through digitalisation of the economy. In sync with the Government of India to create a less-cash economy, your Bank has expanded its digital footprint across the length and breadth of the country.

YONO: YONO, our flagship customer-facing digital Bank caters to various banking, financial services, lifestyle requirements and delivers world class customer experience through distinctive omni-channel and seamless customer journeys. It is also an employee facing platform that enables end-to-end digitisation of regular banking services.

With YONO our customers today can:

- Open an account digitally and do all banking transactions on a mobile app or website.

-    Get advice on and purchase a host of non-banking financial services products such as mutual funds, life and general insurance, credit cards, among others.

-    Get the widest variety and lowest prices on beyond banking products, across 89 merchant partners and 21 categories on the platform.

-    At the same time, our employees can provide the same services to our customers when they need assisted services. Besides, processes that take up close to 60% of branch activities have been digitised with a view to streamline processes, deliver superior in-branch customer experience and free up capacity for value creating activities.

YONO Impact achieved:

A year since launch, YONO has already generated significant value for the Bank in terms of business growth, new customer on-boarding and customer engagement

YONO has achieved 2 crore downloads and approximately 73.49 lakh registrations till date. Over 10 lakh users login daily.

Significant momentum on new customer on-boarding achieved with approximately 25,000 digital accounts opened per day, which was over 75% of all eligible accounts being opened by the Bank with 30-40% higher balances than regular accounts.

YONO is the fastest growing major channel for personal loans. It has crossed over Rs.300 crore of monthly disbursements through a completely paper-less process.

The non-banking financial services product suite, that is, insurance mutual funds, amongst others are achieving alltime highs.

The market place has also been very successful in getting us engagement from our customers. 25% of customers who log in on a monthly basis do so to access the marketplace. For these customers, 45% of the time spent on the app is on the marketplace.

On end-to-end digitisation, we have drastically reduced the TAT for account opening from over 50 minutes to less than 10 minutes and are in process of eliminating the back-office for few key transactions.

Various other intangible benefits were achieved through YONO, for example simplified CKYC process, elimination of paper-based application forms, automated customer validations, amongst others.

Awards won by YONO :

-    “CSI IT Innovation & Excellence Awards 2018” - Best BFSI for Implementation of Digital Trasnformation ( Dec 2018)

-    “ABP News BFSI Award 2018” -Best Bank in Technology Orientation ( November 2018).

-    “Mobile Banking Initiative of the Year - India” at the Asian Banking and Finance Retail Banking Awards, Singapore (July 2018).

-    Indian Express Award 2018 -Enterprise Mobility Category (June 2018).

-    ET BFSI Innovation Awards (September 2018).

Performance Highlights of YONO as on 31st Mar 2019 :

-    2 crore + application downloads

-    73.49 lakh Registrations

-    App rating on Android is at 3.7 and 2.8 on iOS

-    10 lakh+ daily logins

-    98.31+ lakh Fund Transfers C13,413.64 crore ) executed

-    2.40+ lakh Fixed Deposits opened

-    13.84+ lakh Bill payments done

-    27.50 lakh+ Digital Savings accounts

-    Rs.3,800 crore worth disbursals of Digital paperless Pre-Approved Personal Loans to 3.14+ lakh customers, having delinquency rate of less than 0.01 %.

-    89 merchant partners live on the B2C Market Place platform across 21 categories, witnessing approximately 1,37,000 transactions (around Rs.60 crore Gross Merchandise Volume), 1.66 crore merchant clicks, and approximately 54,115 IRCTC ticket bookings.

-    Mutual Funds Gross Sales worth Rs.8,324.79 lakh

-    General insurance policies worth Rs.981.46 lakh (No: 3,19,936)

-    Life Insurance Policies value Rs.1,315.47 lakh (renewal) and Rs.550.93 lakh (New) achieved on the YONO platform.

-    2.16+ lakh SBI Credit Cards linked;

5.79 lakh card payments worth Rs.678 crore done; 1.93 lakh new Card leads generated.

-    Online lead generation and issuance of In-principle approval and sanction of Retail Loans for Home Loan (existing customers), approximately 45,475 leads generated, out of which around 9,356 in-principle approval generated (around Rs.1,402 crore).

-    Innovative product ‘YONO Cash’

- Cardless, paperless withdrawals at ‘YONO cash Points’(ATM) launched Pan India. The innovative YONO Cash feature provides cardless, fast, convenient, and safe cash withdrawal facility at nearly 19,601 ATMs across the country. The enhanced journey to include the scope of paperless/cardless cash withdrawal at POS terminals, branches, and BC channel under YONO Cash is under development.

Debit Cards: State Bank of India has focused on shifting the usage of Debit Cards by customers from ATMs (for cash withdrawals) to PoS terminals/e-Commerce websites. Highest one day spends at PoS/e-Commerce was achieved with ~Rs.1,000 crore on Dhanteras.

Additionally, your Bank has launched various innovations and functionalities around Debit Cards such as Contactless Debit Cards, Bharat QR, Samsung Pay, Visa Checkout, and Personalised Image Debit Card “My Card”. Moreover, it has tied up with various institutions such as Mumbai Metro, Chennai Metro, College of Engineering - Pune, IOCL, and others for launching co-branded Debit Cards/ Combo Cards.

These initiatives made State Bank of India a market leader in terms of share in Debit Card spends, which is at a high of 29.89% as on 31st March, 2019. With approximately 29.67 crore actively used Debit Cards as on 31st March, 2019, State Bank of India continues to lead in Debit Card issuance in the country.

State Bank Foreign Travel Cards (FTC):

The State Bank Foreign Travel Card (SBFTC), is a chip based EMV compliant card and is issued on VISA and MasterCard schemes providing safety, security, and convenience to overseas travellers. On VISA it is available as single currency card in 8 currencies - US Dollar, British Pound Sterling, Euro, Canadian Dollar, Australian Dollar, Japanese Yen, Saudi Arab Riyal, and Singapore Dollar. On MasterCard it is available as Multicurrency Card in 7 currencies - US Dollar, British Pound Sterling, Euro, Canadian Dollar, Australian Dollar, Singapore Dollar, and UAE Dirham. Your Bank has also introduced corporate variants of SBFTC to cater to varying needs of corporate customers. Additionally, your Bank is aggressively promoting tie-ups with FFMCs (Full Fledged Money Changers).

FASTags: Your Bank has issued more than six lakh SBI FASTags to customers. Consequently, Toll transactions through SBI FASTags have crossed a mark of 216 lakh with a total transaction amount of over Rs.395 crore as on 31st March, 2019. State Bank of India has put onboard, State Road Transport Corporations in Uttar Pradesh, Punjab, Uttarakhand, Odisha, Tamil Nadu, Karnataka, and West Bengal for FASTag services.

Metro and Transit Projects: Your Bank has implemented a first- of-its-kind end to end ticketing solution for the Noida Metro Project using the National Common Mobility Card (NCMC) specifications based RuPay Prepaid Card. State Bank of India has also been awarded the Hyderabad and Nagpur metro project for implementation of Open Loop Automatic Fare Collection System based on the NCMC card specifications, the work of which is under way.

Smart City: Your Bank has a dedicated team to capture the payment eco-system in the 100 identified Smart-Cities in India. The plan is to foray into the transit solution/ integrated ticketing solution for ‘One City One Card’, which is a payment initiative for the Smart Cities.

Cash@PoS: To reach out and facilitate maximum number of people looking for convenient cash withdrawal, State Bank of India, provides facilities of cash through ‘Cash@POS’initiative. Debit card holders of State Bank of India and all other Banks can withdraw cash from PoS machines installed by your Bank across various merchant locations. As per the RBI guidelines customer can withdraw Rs.1000 in Tier I and Tier II cities whereas Rs.2000 can be withdrawn in Tier 3 to Tier 6 cities per day per card. Presently, your Bank is not charging any fee. State Bank of India has a total of 5.75 lakh PoS machines of which 4.78 lakh PoS machines are enabled to dispense cash to the customers of your Bank and the Banks who have enabled this facility for their customers.

Merchant Acquisition: The digital payments landscape in India is evolving at a rapid rate and your Bank is playing an effective role in building momentum for transforming India through digitalisation of the economy. In sync with the focus of the Government of India to create a less-cash economy, your Bank has expanded digital payment acceptance infrastructure across the length and breadth of the country. During the year, your Bank introduced a multi option payment acceptance device named MOPAD facilitating payments via cards, Bharat QR, UPI, and SBI Buddy (e-wallet) on a PoS terminal. In addition, your Bank continued to expand digital footprint across the country and deployed 5.75 lakh PoS terminals, 4.19 lakh Bharat QR code and on-boarded 6.31 lakh merchants on BHIM-Aadhaar-SBI. In total, the number of merchant payment acceptance touch points crossed 27.91 lakh as on 31st March 2019. Your Bank has acquired nearly 54 crore transactions during FY2019 with 24% increase on Y-o-Y basis. In addition to offering basic acquiring services, your Bank is also providing other services such as:

-    NFC acceptance on PoS terminals

-    DCC-Dynamic Currency Conversion

-    EMI

-    Cash@POS

-    Acceptance of AMEX, DINERS, DFS, JCB, and UPI

Your Bank continued the efforts to onboard merchants from premium segments like OMCs, retail chains, life style stores, and holiday resorts apart from consolidating the existing business. Your Bank has tied up with major Corporates and with Government departments to migrate their operations from cash to digital mode. This involve customisation and integration of its systems with those of corporate and Government departments to ensure seamless flow of digital transactions. Some of the notable integrations are with Indian Railways, SOUTHCO (Odisha), APDCL (Assam Power Distribution Co. Limited), Goa - GBSS project (Government of GOA), Cyber Treasury (Govt of Madhya Pradesh), IGR (Inspector General of Registrar) Pune, Noida, and Nagpur Metro. Your Bank has also initiated the development of acceptance infrastructure for NCMC (National Common Mobility Card) on our PoS terminals to push the government initiative of ‘One Nation One Card’.

State Bank of India has transferred merchant acquiring business to its subsidiary SBI Payment Services Private Limited (SBIPSPL) and has subsequently inducted Hitachi Payment Services Private Limited, a domain player as a JV Partner with minority shareholding. This will enable SBIPSPL to offer innovative technology driven products in digital payment acceptance system, which will boost Digital India Initiative and offer improved merchant experience.

8. Customer Value Enhancement

Your Bank is the Corporate Agent of SBI Life Insurance Co. Limited and SBI General Insurance Co. Limited and has Distribution Agreement with SBI Mutual Fund, SBI Cards & Payment Services Private Limited and SBI Cap Securities Limited for distributing their products. Your Bank also distributes mutual fund products of UTI Mutual Fund, Tata Mutual Fund, Franklin Templeton Mutual Fund, L&T Mutual Fund, ICICI Mutual Fund, and HDFC Mutual Fund. In addition, all branches are authorised for opening pension accounts under National Pension System.

Performance Highlights: (Commission on Cross Selling)

ACTUALS

J Vs

YTD March 2018 YTD March 2019

 

(Rs.in crore)

(Rs.in crore)

SBI LIFE

714.75

951.90

SBI MF

560.51

503.00

SBI GENERAL

212.57

270.86

SBI CARDS

135.83

190.69

SSL

5.14

6.70

NPS

2.44

4.11

TOTAL

1631.24

1927.26

INITIATIVES AND SUCCESSES

SBI LIFE

-    Digital sale has gone up from 22% to 92% in FY2019.

-    Number of Specified Person for Life insurance has increased to 54,317 as on March 19 as against 46,180 in March 18 (Increase of 17.6%)

SBI MF

-    SBI has become India’s No.1 Bank distributor in terms of AUM (more than Rs.72,000 crore).

-    SBI continues to be the market leader in terms of Live SIP numbers (more than 22 lakh) and SIP Book Value as on March 19.

SBI GENERAL

-    Number of Specified Person for General Insurance has increased to 22,034 as on March 19 as against 20,646 in March 18 (Increase of 6.72%)

SBI CARD

-    No of cards issued through Banca Channel crossed 15 lakh in FY2019.

-    Cards sourced from Banca Channel has increased from 45% in FY2018 to 55% of total cards issued by SBI Card in FY2019.

SSL/NPS

-    Bank continues to maintain its dominance in mobilising maximum number of NPS accounts this year as well.

-    Bank was qualified as Top Performing Point of Presence (POP) under various campaigns observed by PFRDA.

-    Bank has shown a significant growth in income earned by sourcing Demat accounts and by opening NPS accounts.

9. Internet Banking and e-Commerce

State Bank of India continues to grow and lead the digital banking space propelled by the enhanced outreach of ‘Onlinesbi’across all customer segments. The channel has expanded its footprint with over 129.23 lakh new user additions during the first nine months showing a marked increase over the last year’s reach (see Table).

With introduction of new features and several add-ons provided in ‘Onlinesbi’to enhance customer comfort and experience, the platform handled transaction volume exceeding 162 crore with transaction value of nearly 127.78 lakh crore, recording a quantum jump over the last year (see Table). This reflects on the growing customer confidence on our offerings and deliverables.

Key Performance Indicators

2017-18

2018-19

New User Registration (Rs.in lakh)

94.63

129.23

Transaction Volume (Rs.in crore)

156.56

162.06

Transaction Value (Rs.in crore)

95,07,340

127,77,976

Key Enablers:

-    Green Password has been launched during the year to enhance customers’ease in joining our digital platform with a hassle-free self-registration process. This is set to expand the INB coverage among existing and new customers.

-    Launch of Virtual Account Number (VAN), a customised collection tool for big corporates with its unique alphanumeric code that masks the account details of the corporates from the remitter, is another big milestone reached during the year.

-    Facility for the non-INB customers to update their email ID in CBS records by accessing the option ‘Register / Update your E-Mail ID’under the tab ‘Useful Links’.

-    One of the key enablers provided to customers is the facility, which enables them to reply to transaction alerts received through SMS and email for instant reporting of unauthorised transactions.

-    Mobile registration was made mandatory to facilitate receipt of SMS alerts by customers.

-    Online download of Form 16 A is now made available through OnlineSBI.

C. SMALL AND MEDIUM ENTERPRISES

Your Bank is pioneer and market leader in SME financing. With over ten lakh customers, the SME portfolio of Rs.2,88,583 crore, as on 31st March 2019 accounts for nearly 12.58% of your Bank’s total advances. State Bank of India has always held SMEs as an important segment, considering the role being played by them in the Indian economy in terms of their contribution to manufacturing output, exports and employment generation. Being committed to providing Simple and Innovative Financial Solutions, your Bank’s approach in driving SME growth rests on the following three pillars:

a)    Customer Convenience,

b)    Risk Mitigation,

c)    Technology based digital offerings and process improvements

1. Customer Convenience

With a view to build and sustain the momentum for transforming India, your Bank has created the highest units of touch points in terms of branches and other modes. With a view to enhance ease of business for the Small and Medium Enterprises, State Bank of India modified its existing delivery model of Small and Medium Enterprises Centre (SMEC) and created Asset Management Teams (AMTs) to maintain end to end relationship with the customers for micro loans up to Rs.50 lakh. The SMECs have also been strengthened in terms of manpower, which has resulted in improvement in the service.

2. Digital offerings:

Your Bank is leveraging technology in every aspect of the value proposition from sourcing business, designing products, streamlining process, improving delivery to monitoring. Furthermore, it has taken several initiatives to build SME portfolio in a risk mitigated manner and has implemented significant changes in (i) Product suite, (ii) Process (iii) Delivery.

Loan Life-Cycle Management

Lead Management System (LMS): Your Bank is hosting an online loan application and tracking facility for MSME borrowers on the Corporate Website www.sbi.co.in. It is an internet-based Credit Proposal Tracking System called Lead Management System (LMS), which allows customers to apply for a loan online and receive an acknowledgement in the form of application reference number.

Customer Relationship Management (CRM): Leads sourced are tracked and monitored for delivery through this system.

Loan Origination Software (LOS-SME) and Loan Life Cycle Management System (LLMS): With a view to adopt the uniform standards of credit dispensation for ensuring quality and preserving corporate memory, loans are processed through LOS and LLMS for small and high value loans respectively.

Contactless Lending Platform

State Bank of India is one of the members of SIDBI led PSB consortium and your Bank’s path-breaking initiative, psbloanin59minutes.com, provides easy access for loans to SMEs registered on GST platform and filing income tax. On this Contactless Lending Platform (CLP), in-principle sanction of loans up to Rs.1 crore is processed. 8,377 in-principle sanctions were generated through CLP by FY2019, amounting to Rs.3,250 lakh.

Project Vivek

Project Vivek heralded a paradigm shift in your Bank’s appraisal system from traditional Balance Sheet based funding, to a more objective appraisal system of leveraging cash flow and other information sources. It is a promising initiative launched by State Bank of India to implement a new Credit Underwriting Engine (CUE) for the SME segment, thereby bringing objectivity in better risk assessment. Moreover, it reduces Turn Around Time (TAT) resulting in better customer experience. By FY2019, a total of 34,477 proposals were processed under Project Vivek. Further, during the year, technical enhancements were done in the project to improve the underwriting process.

SBI and QCI sign MoU on Zero Defect Zero Effect (ZED) Certification for MSMEs: State Bank of India becomes the first Bank to sign a Memorandum of Understanding (MoU) with Quality Council of India on the Zero Defect Zero Effect (ZED) Certification Scheme of Ministry of Micro, Small and Medium Enterprises, Government of India.

As part of this MoU with QCI, your Bank has decided to offer concessions in Pricing/processing charges for MSMEs having better ZED ratings. State Bank of India is also considering incorporating ZED rating as a parameter in its Bank’s internal rating system.

Briefly, this MoU will pave way for a collaborative arrangement on implementation of ZED on a nation-wide scale on specific activities aimed for the benefit of MSMEs. Both your Bank and QCI will define a strategic framework to take forward the vision of Hon’ble Prime Minister for making our MSMEs adopt Zero Defect and Zero Effect practices.

The ZED Certification Scheme of Ministry of MSME is aimed at enhancing the global competitiveness of Indian MSMEs on quality and environment aspects in their systems and processes. It is a continual improvement and rating scheme involving handholding and certification of MSMEs with financial support from the Government of India. Ministry of MSME has nominated QCI as the National Monitoring and Implementing Unit (NMIU) of this Scheme.

So far more than 20,000 MSMEs have registered for ZED and many State Governments are already incorporating ZED in their Industrial Policies.

Trade Receivables Discounting System (TReDS)

State Bank of India was the first among all PSBs to register as a financier during the year on the TReDS platform RXIL and M1xchange, set up to provide finance to MSMEs. With this we now have our presence on all the 3 TReDS platforms in the country. Your Bank was actively participating in the online biddings on the platform and was offering very competitive rates for the benefit of MSMEs. Your Bank rediscounted bills worth Rs.72.51 crore, which were discounted by SBI Global Factors Limited on the 3 TReDS platforms.

3. Business Partnerships/ Tie-ups

Your Bank is expanding its portfolio of Warehouse Receipt Finance and Supply Chain Finance through Business partnerships/Tie-ups with Collateral Managers and Industry Majors.

Warehouse Receipt Finance:

Your Bank has introduced Warehouse Receipt Financing scheme (WHR) to extend finance to traders/owners of goods/manufacturers for processing, provided against Warehouse Receipts issued by Collateral Managers having a tie-up with State Bank of India. Further, WHR issued by Central Warehousing Corporation (CWC) and State Warehousing Corporation (SWC) would also be eligible for WHR finance. The WHR portfolio as on 31st March, 2019 stands at Rs.6,111 crore.

Supply Chain Finance:

Leveraging state-of-the-art technology and branch network, your Bank has emerged as a major player in Supply Chain Finance by strengthening its relationship with the corporate world.

During the fiscal year, State Bank of India entered into 61 new e-DFS (Electronic Dealer Finance Scheme) and four new e-VFS (Electronic Vendor Finance Scheme) tie-ups covering 351 Industrial Majors, 25,921 of their dealers and 16,572 vendors. The number of oil dealers (Petrol Pumps) on e-DFS crossed 14,806 during the last fiscal.

4. Risk Mitigation:

Your Bank has increasingly been shifting its focus towards Risk Mitigated Products, which include Asset Backed Loans, Overdraft against Bank Deposits/ Government Securities, Bills Discounting facility, and CGTMSE/CGFMU covered loans, amongst others.

Pradhan Mantri Mudra Yojana:

In line with the initiatives of the Government of India, your Bank has laid considerable emphasis on extending credit facilities to eligible units under different variants of Pradhan Mantri Mudra Yojana and has disbursed Rs.33,612 crore for FY2019 under PMMY, against a target of Rs.33,550 crore.

Credit Flow to Micro and Small Enterprises under CGTMSE:

State Bank of India was a pioneer in supporting MSMEs and Micro and Small business, by extending collateral free lending up to Rs.2 crore under guarantee of CGTMSE. Your Bank has a portfolio of Rs.7,830 crore under CGTMSE as on 31st March, 2019.

D. RURAL BANKING

1. Agri Business

Credit support for agriculture and allied activities gained greater momentum during this year, although the external environment was marred by farm distress and the effects of debt waivers announced by various State Governments. In line with the past trends, the credit flow to agriculture set by the Government for FY2019 was surpassed by your Bank.

FLOW OF CREDIT TO AGRICULTURE

YEAR

TARGET

DISBURSEMENT

% ACHIEVEMENT

FY2016

89,781

1,02,423

114%

FY2017

95,168

1,25,270

132%

FY2018

1,05,741

1,66,819

158%

FY2019

1,16,315

1,56,385

134%

Your Bank has launched nine products for Dairy, Fisheries, Poultry, Sheep rearing, Goat rearing, Piggery, Bee-keeping, Sericulture, and Mushroom Cultivation wherein loans with a limit up to Rs.10 lakh are being sanctioned without obtaining any collateral security under the Mudra scheme with liberalised terms, as allied agricultural activities are means of increasing farmers’income.

During the year, the Agri portfolio growth was ahead of the YTD ASCB trends. The YTD growth in total Agri advances, as on 31st March, 2019 is Rs.14,430 crore. The comparative growth in overall Agri Advances portfolio is as under:

                                                 (Rs.in crore)

Year

Total Agri

YoY Growth

YoY Growth

 

Advances

Amount

%

FY2019

2,02,681

14,430

7.67%

FY2018

1,88,251

(3014)

(1.58%)

Your Bank has witnessed an impressive pickup under Risk Mitigated loans such as Gold Loan, ABAL (Asset Backed Agri Loan) and Portfolio Purchases from MFIs, resulting in an increase in the share of Risk-mitigated loans from 27.6% in FY2018, to 30.3% in FY2019 at a whole Bank level. In Portfolio Purchases from MFIs under Direct Assignments, a total of 29 proposals worth Rs.9,555 crore were sanctioned during FY2019.

A new product designed to meet the general-purpose needs of farmers against the collateral of property, called the Asset Backed Agri Loan (ABAL), picked up momentum during the year with a growth of about 142%, albeit on a lower base. This product was readily accepted by customers because of the flexibility it offers.

Your Bank is de-risking its Agri portfolio and supporting farmers at the same time by tying up with local and national level Agri Corporates, wherein the supply chain will ensure cash flows for timely renewal of loan and better incomes for the farmers. Additionally, it is lending under a Cluster-based approach to tap opportunities revolving around areas and centres, which have traditionally been known for shrimp farming, dairy, poultry and, higher value horticulture crops such as pineapple and mango.

Micro credit (SHGs Bank Linkage):

Your Bank has the highest market share in SHG loans outstanding, among all Banks with outstanding loans of Rs.13,444 crore to 6.09 lakh SHGs as on 31st March, 2019 including more than 50 lakh women members.

Deendayal Antyoday Yojana: National Rural Livelihood - Mission (DAY-NRLM):

Since inception of DAY-NRLM on 1st April, 2013, your Bank has financed 14,25,670 SHGs under Bank-SHG Linkage and disbursed Rs.23,939 crore.

State Bank of India has won the National Award for highest SHG Bank linkages for the year 2018, instituted by Ministry of Rural Development, New Delhi on 11th May, 2018. Your Bank’s market share of loans under National Rural Livelihood Mission among PSB is 25.42% as on 31st March, 2019.

Other Initiatives

Recognising the contribution of rural India to the nation’s economic growth, your Bank is striving to meet the financial needs of the rural segment through various new channels and services. To create focused attention on the importance of soil health card and advocating for sustainable management of soil resources aimed at enhanced Agri production, State Bank of India has observed World Soil Testing Day on 5th December, 2018 across the country at selected branches by inviting Agriculture Scientists and farmers at field level. The programme was themed “Be the Solution to soil pollution” to encourage Organic Farming.

As widely reported, the Agriculture sector saw developments with a few States announcing waiver of farm loans in response to demands made by the farmers.

Your Bank announced Rinn Samadhan:2018-19 scheme, covering farm sector loans and achieved the set internal targets.

Keeping in view the large number of customers served by your Bank, it organised mass contact programmes on five occasions during the year. Under this initiative, all Rural and Semi-urban branches held informal meetings with farmers to improve customer connect and spread awareness about your Bank’s and Government’s schemes. As estimated, at least 14 lakh farmers attended these meets.

Other remarkable initiatives taken during the year included issuance of 72 lakh KCC-ATM-RuPay Cards to Kisan Credit Card (KCC) borrowers for ease and operational convenience. KCC RuPay Cards work seamlessly with ATMs and PoS machines, enabling farmers to purchase their day-to-day farm requirements on 24x7 basis.

State Bank of India, organised Kisan Mela at nearly 14,000 rural and semi-urban branches across the country. It is an initiative by your Bank to connect with farmer customers, resolve their grievances, and educate them about their rights and your Bank’s initiatives.

As part of Kisan Mela, your Bank also offers KCC farmers an enhancement of 10% to their credit limit on renewing the account. In addition to this, State Bank of India has taken this initiative to reach out to the farmers to educate about the benefits of renewing KCC account to get maximum benefits of interest subvention from Government and coverage under Pradhan Mantri Fasal Bima Yojana. Your Bank has also made farmers aware about the benefits of timely renewal of KCC account and usage of KCC Rupay Card for transactional convenience.

Furthermore, your Bank will sensitise farmers on various Agri-products of your Bank like Asset Backed Agri-loan, Mudra Loan and loans on other allied Agri activities.

2. Financial Inclusion (FI):

Your Bank realises the role it must play as the largest Bank in the country in practicing and promoting FI activities. The spread of digital banking channels and expansion of Business Correspondents (BC) network is giving your Bank the impetus to further grow its FI activities. Thus, to achieve inclusive development and growth, your Bank has worked out strategies and leveraged technology to expand financial services to the door steps of the unbanked with the purpose of bringing them under the ambit of formal banking system.

Your Bank has 57,467 operating BCs and 22,010 branches across the country to offer banking services. The BC channel, which provides customers in unbanked areas an access to various banking products and services while reducing footfalls in the branches, has recorded 39.75 crore transactions amounting to Rs.1,73,381 crore in FY2019, translating to around 15 lakh transactions per day.

Under the flagship Pradhan Mantri Jan Dhan Yojana (PmJdY) of Government of India, State Bank of India has paved the way for universal financial access by being a pioneer in implementing the programme. Your Bank has opened 10.97 crore accounts by FY2019 and issued 9.20 crore RuPay debit cards to the eligible customers. These initiatives taken under financial inclusion as part of key economic policy agenda of the Government over the last decade, has ensured access to Bank accounts for the excluded persons.

To fulfil the needs of Social Security measures, low cost Micro insurance products (PMJJBY, PMSBY) and pension schemes (APY) are provided to the unorganised sector in a big way, covering around 3 crore customers.

Imparting Financial Literacy

With the objective of imparting financial literacy and facilitating effective use of financial services, your Bank has set up around 338 Financial Literacy Centres (FLCs) across the country. During FY2019, a total of 29,450 financial literacy camps were conducted by these FLCs across the country. As a part of the pilot project implemented by RBI, your Bank has set up 15 centres for Financial Literacy at Block level, five each in the state of Maharashtra, Chhattisgarh and Telangana in association with NGOs identified by RBI.

State Bank of India hosted a panel discussion on ‘India-China: Financial Inclusion - Experiences and Challenges’. The discussion was attended by a high-level delegation from China, which included Mr. Li Wei, President, Development Research Centre, PRC, and Minister. Furthermore, it was centred around the initiatives taken by the Indian and Chinese governments towards financial inclusion, the experiences and the challenges thereto.

Rural Self Employment Training Institutes (RSETIs) play an important role in skill development by imparting comprehensive quality training programme to rural youth. Additionally, it facilitates them in setting up micro enterprises. Your Bank has set up 151 RSETIs spread across 27 States and one Union Territory.

RSETIs have trained over 96,999 rural youth in FY2019. Over 70% of the candidates trained are women and 92% of the candidates trained belong to non-general categories (SC/ST/ OBC/ Minorities). More than seven lakh candidates were trained by SBI-RSETIs since 2012 of which 69% were settled, in gainful vocation.

E. NBFC ALLIANCES

Reserve Bank of India has issued guidelines on co-origination of loans with Banks and NBFCs. Based on the guidelines, your Bank has created a new department ’NBFC Alliances’in the month of October, 2018. The main objective of the Department is to partner with NonBanking Finance Companies and Micro Financial Institutions across the country in Co-origination of loans for creation of assets under priority sector.

To achieve this objective, your Bank has formulated a detailed policy approved by The Central Board. Additionally, the NBFC Alliances Department focuses on engaging NBFC/MFIs (other than NBFC-ND-SI) as Business Associates to achieve a growth in Priority Sector Advances. Moreover, the Department also facilitates portfolio purchase and securitisation of loan portfolio with respective Business Units, viz., ABU, SMEBU, REHBU and PBBU.

Your Bank has stepped up the target for purchase of good quality portfolio of assets from NBFCs, as it believes that there is good opportunity to expand its loan portfolio at attractive rates. Your Bank is looking for opportunities both in priority and non-priority sectors. Your Bank had initially planned for a growth of Rs.15,000 crore through portfolio purchase during the current year, which is now being enhanced.

F. OTHER NEW BUSINESS INITIATIVES

1. Special Projects

IFSC Banking Unit at GIFT SEZ: The

Chairman, inaugurated your Bank’s IFSC Unit (IBU) at International Financial Services Centre (IFSC) located at the GIFT-SEZ, Gandhinagar, Gujarat. Many developed countries have financial hubs, which have evolved over a period as International Financial Centres (IFC). These centres provide suitable regulatory regimes and create a business environment to attract talent and capital. Successful IFCs are places where business is conducted between organisations from all over the world using latest financial technologies and products.

While the 100% tax concession available till 2020 and 50% for the next 5 years till 2025 are surely an attraction, they are not the only reason why your Bank has set up an Office in IFSC. The proceeds of ECBs (External Commercial Borrowings) which were hitherto being parked at high cost jurisdictions like London, New York, Singapore and Hong Kong, are now being parked at IFSC GIFT City, to optimise on the cost.

Initiatives for pilgrims at Kumbh Mela:

With an aim to provide banking services to millions of pilgrims and visitors at the Kumbh Mela, State Bank of India undertook various initiatives. For the 50-day Prayagraj Kumbh Mela, your Bank provided all the necessary assistance to the devotees in the form of two 14-hours working State Bank of India branches, four ATMs, three mobile ATMs as well as a forex counter.

2. Strategy

Following the best global practice, your Bank has created the position of Chief Strategy Officer (CSO) during 2018-19 with the objective of defining journey towards realising Mission Statement of your Bank and transforming vision of Top Management into reality. The position of CSO in your Bank will help in establishing robust strategy framework for enhancing value. The CSO’s role also aims for strategic synergy amongst all verticals for enhancing value for Customers, Shareholders and Employees.

The CSO addresses both the business and operational strategy of your Bank. The key areas for CSO organisation have been envisaged as below:

Data Analytics - With support of a core effective group of Analytics professionals, CSO’s role is to churn the Bank’s own data as well as external data to prepare long term insights and actions. The CSO and his team also assist the senior management with quick analytics for decision making.

Market Research, Benchmarking and

Competition - The CSO undertakes market research and analysis of the key products, processes and service lines of the competitors on a continuous basis vis-a-vis our products. This includes service delivery to formulate responsive and creative strategies, mostly in collaboration with the leaders of our Business Units and Field Operations.

Key Project Monitoring - CSO work as a bridge between Top Management and Business Unit owners and Field Managers to keep key strategic projects on track and ensure their speedy and timely implementation.

Few of the projects taken up by CSO for comprehensive improvement of Market Share in major cities of the country include

-    Strategic Tie-up for enhancing the Brand value

-    Marketing and Branding of YONO

-    Realising group synergy

Another strategic initiative taken up by CSO is for Branch Transformation and Re-Imagining of Branch Experience. The objective of the project is to decongest the branches, re-design the desks and transform the branches from being transaction oriented to business oriented and improve service delivery. Besides, several initiatives have been taken up for de-cluttering of branches and uniform branch layout for overall improvement in customer experience.

G. GOVERNMENT BUSINESS

Your Bank has traditionally been the banker of choice to the Government and is the accredited Banker to the major Central Government Ministries and Departments. Being the market leader in Government Business (with a market share of more than 80% in Government commission), your Bank is at the forefront in the development of e-Solutions for both Central and State Governments. This has facilitated their transition to the online mode, resulting in greater efficiency and transparency. Your Bank is an active stakeholder in the Government’s latest initiatives namely, Government e-Marketplace, and is continuously engaged in developing customised technology solutions such as e-Tendering, e-BG, e-Trade, amongst others, to keep pace with the Government’s digital initiatives.

                                      (Rs.in crore)

Particulars

FY2017-18

FY2018-19

Turnover

55,61,295

57,47,997

Commission

3,409

3,974

With a view to facilitate e-Governance, digitisation and bringing in more efficiency and transparency, the following initiatives were implemented during the year:

1. GeM (Govt. e-Marketplace)

State Bank of India is the pioneer amongst Banks for financial integration of payments to suppliers for procurement of common goods and services through GeM portal. Five State GeM Pool Accounts were opened at Uttar Pradesh, Tamil Nadu, Himachal Pradesh, Puducherry, and Gujarat. GeM Pool Accounts of more than 70 Autonomous bodies were opened.

2.    e-Tendering

Your Bank has implemented the e-Tendering solution for various departments of Maharashtra, Punjab, Kerala, UP, and Assam State Government.

3.    PMJAY-Ayushman Bharat

Settlement accounts under the scheme were successfully opened in nine States/ UTs viz Uttar Pradesh, Maharashtra, West Bengal, Assam, Puducherry, Sikkim, Nagaland, Tripura, and Andaman and Nicobar Islands.

4.    Indian Railways

State Bank of India has completed integration for collection of Application fee for recruitment in Railway Protection Force through SB MOPS. mOu with Northern Railways for Cash Pickup through our empanelled agencies was executed in FY2019 covering a Total of nine Railway Zones out of 16.

5.    Direct Benefit Transfer (DBT)

State Bank of India is the sole Banker for processing Direct Benefit Transfer of LPG subsidy (DBTL). Total number of transactions and amount processed in FY2019 are as following:

                                     (Rs.in crore)

Particulars

No. of

Amount

 

transactions

(Rs.in crore)

 

(crore)

 

DBTL

128.95

36,653

DBT (others)

33.06

2,07,526

6.    Auction of items gifted to Honourable Prime Minister

Your Bank has made its services available for collection of proceeds from the auction of items gifted to Honourable Prime Minister at the National Gallery of Modern Arts, New Delhi. The event was executed by the Ministry of Culture.

7.    National Testing Agency

Successful Payment Gateway integration with National Testing Agency for collection of examination fees.

8.    CBSE

SBMOPS was integrated with CBSE platform for fee collection of CBSE affiliated schools.

9.    Pension Payments

State Bank of India has been administering pension payment to 55.57 lakh pensioners through its 16 CPPCs making disbursment of total pension amount of more than Rs.1,56,835 crore. During FY2019 2.79 lakh new pension accounts and eight Autonomous Bodies were on boarded for Pension payments. A number of pensioner connect programmes were conducted across the country.

10.    Small Savings Schemes

State Bank of India services more than 75.79 lakh PPF and 14.79 lakh SSA accounts making it the highest among all the authorised Banks. Additionally, 5.78 lakh PPF accounts and 3.16 lakh SSA accounts were added during this FY.

11.    Other

Your Bank was accorded an approval for opening 33 Accounts for Enforcement Directorate under Ministry of Finance. Your Bank was chosen as an Aggregator Bank for collection of tax and non-tax revenue of the Government of West Bengal. Workshops were conducted across the country for training the personnel of Implementing Agencies.

12.    Awards

Your Bank was awarded First Prize for opening the largest Number of Sukanya Samriddhi Accounts amongst all Banks (Pan India). The award was given at National Savings Institute, New Delhi on 30th October, 2018 to celebrate “World Thrift Day”.

H. TRANSACTION BANKING UNIT

Your Bank’s Transaction Banking Unit (TBU) leverages technology to provide comprehensive solutions for bulk transaction requirement of clients, facilitating their efficient funds management along with other value-added services such as customised MIS, integration with Corporate ERP and dedicated single point Client Support Cell. Transaction Banking services not only facilitate your Bank to maintain close relationship with clients, but also to assess their other Banking requirements such as Credit, Fund Management and Cross Selling.

Your Bank offers a wide range of TBU products and services to Corporate, Government Departments, Financial Institutions and SME Clients. While Corporate and Government clients continue to be the key focus segment, Bank is also marketing among existing clients as well as start-ups in SME sector.

Keeping in line with market trends, your Bank is continuously updating/evolving the bouquet of TBU products/services offered to clients to match the competitors’products/services.

-    TBU Fee Income increased by 48.50% from Rs.893.66 crore in FY2018 to Rs.1,327.08 crore in FY2019. A 30% plus annual growth has been consistently achieved in fee income during the last few years.

-    TBU Float Income increased by 81.15% from Rs.356.69 crore in FY2018 to Rs.646.15 crore in FY2019.

-    Turnover registered a Y-o-Y increase of 78.39% with transactions amounting to Rs.38,08,314 crore in FY2019 over Rs.21,34,867 crore in FY2018.

-    Your Bank was recognised as “The Best Transaction Bank in India” by The Asian Banker for the second time in a row in 2018.

2. GLOBAL BANKING

The Wholesale Banking Business in your Bank focuses on servicing Corporate clients through customised financial solutions such as working capital finance, export finance, trade transactions and foreign currency loans. It comprises of several teams focused on specific areas such as specialisation of product offerings, acquiring new business and generating new income streams with continuous focus on profitability and risk mitigation.

A. CORPORATE ACCOUNTS GROUP

The Corporate Accounts Group (CAG) is a dedicated vertical handling the “large credit portfolio” of your Bank through 4 offices in 3 Centres viz., Mumbai with two branches and one each in Delhi and Chennai. CAG now is a super specialised set-up handling 29 top rated Business Group accounts and 66 Non-group accounts to ensure that the quality of service for these prioritised relationships is maintained as the best in the class.

The business model of CAG is anchored on the Relationship Management Concept wherein each client group is mapped to a Relationship Manager who leads across -functional Client Service Team. The Account Management Teams (AMTs) work on a central strategy of delivering integrated and comprehensive financial solutions to the clients, through structured products, within a strict TurnAround-Time. The principal objective of the strategy is to make your Bank the first choice of top corporates.

To firmly align with the changing Banking landscape, in June 2018, your Bank undertook a major revamp of Corporate Credit dispensation Structure making it a future ready set-up to drive sustainable growth. Core objectives of this holistic revamp were, strengthening credit risk management function, leveraging analytics, making a paradigm shift of focus in business from ‘Fund to Fee” and Originate to Distribute (O-t-D) so as to improve Bank’s overall wallet share in Corporate Banking Business. In addition to credit relationship, Bank is now actively looking at customer 360 requirements especially in credit light sectors viz -Pharma, FMCG, IT, Auto etc. through its newly established Credit Light Group (CLG) set within the CAG set up.

A Specialised Group, FIG (Financial and Institutional Group) to address credit and transactional banking needs of Insurance Companies, Brokering Firms, Banks (Private and Foreign) and Mutual Funds has also been created within CAG. Both the newly created groups have taken off and have started contributing to the Bank’s business growth.

Banking technology is revolutionising the way customers engage with their finances. Convenience, speed and flexibility are no longer considered attractive add-ons, but have become a standard expectation of the rapidly changing customer-Bank relationship. Towards this end, your Bank is investing continuously in building technological capabilities to become more agile towards customers’needs. We are currently offering cutting edge technology products to our Corporate customers and are using the latest CRM application for customer management.

Overall, the Corporate Accounts unit has reoriented itself to focus on the highest priority and quality individual and group relationships with differentiated coverage.

The total post revamped outstanding loans to clients in the Corporate Accounts unit stood at Rs.2.33 lakh crore and Rs.1.68 lakh crore in respect of fund-based and nonfund-based products as on 31st March 2018 and the corresponding fund based and non-fund based outstanding are Rs.4.07 lakh crore and Rs.1.75 lakh crore as on 31st March 2019 respectively.

Corporate Account Group has been a partner in the industrial growth of the country, especially in creation and development of critical infrastructure viz Roads and Highways, Ports, Power, Telecom, Petrochemicals etc. and your Bank wishes to continue its contribution to Nation’s growth as hitherto.

B. TREASURY OPERATIONS

The Global Markets Unit (GMU) performs the Treasury Operations of your Bank with the objective of managing its liquidity in compliance with regulatory requirements, mitigating related risks like liquidity risk, market risk and operational risk. GMU deploys the surplus funds in various investment options based on economic research and scenario analysis and optimises risk and returns. The investment book under Global Markets stood at Rs.9,26,651 crore at FY2019 as against Rs.10,26,438 crore as on FY2018. It also provides Foreign Exchange services and hedging instruments to customers across the country.

(i) INTEREST RATE MOVEMENTS & SLR AND NON-SLR PORTFOLIO OF THE BANK

GMU is responsible for managing regulatory requirements such as your Bank’s SLR/CRR management, maintaining HQLAs for LCR, amongst others. As interest rate markets saw wild movements during the year, RBI increased the overnight repo rates twice during the year, on 7th June 2018 and 2nd August 2018. After low CPI prints and easing of crude price, RBI reduced the Repo Rate in its Sixth Bi-Monthly Monetary Policy dated 07th February 2019 along with change in stance from Calibrated Tightening to Neutral. The repo rate stands at 6.25% post February 2019 policy and has further been reduced to 6% on 4th April 2019. US Federal Reserve was also on a hiking spree by increasing the Fed Target rates four times during the calendar year 2018. With the last rate hike in December 2018, the Fed rate now stands at 2.50% as on 31st March 2019.

On the domestic front, the movement of Interest rates was volatile. The benchmark 10Y security (7.17 CG-Sec 2028), which was trading at 7.40% at the beginning of FY2019 touched a peak of 8.18% on 11th September, 2018 before touching a low of 7.22% on 19th December, 2018. Excess supply in State Development Loans, depreciation in domestic currency, increase in crude prices made the year a roller coaster ride for yields. Due to this volatility, your Bank made provisions on investments.

By the beginning of Q2 FY201 9, the system liquidity turned negative, which got aggravated due to the NBFC crisis in the month of September 2018. The liquidity shortfall prompted RBI to conduct Open Market Operations (OMO) to improve the system liquidity. The OMO helped to reduce the excess SLR holding of Banks and alleviated the supply pressures. This resulted in easing of 10-year G-Sec yield.

During the year, with the credit growth outstripping the deposit growth, your Bank’s SLR portfolio was brought down in a calibrated manner to generate liquidity. However, in view of the elevated yield levels, your Bank increased the Corporate Bond portfolio as a measure of improving the overall portfolio yield. Net Interest Income stood at Rs.88,349 crore as against Rs.74,854 crore for FY2018. Profit on sale of investments is at Rs.1,023 crore against Rs.12,303 crore for FY2018.

(ii) EQUITY MARKETS

The equity markets touched its alltime high levels in FY2019. Post default by IL&FS and on NBFC liquidity concerns, market saw sharp correction in the Benchmark indices. However, market rallied sharply towards the end of the financial year due to strong inflows from FIIs and Nifty ended with 14.93% gains in FY2019. The outcome of General elections, Fed Policy actions, expectation of Global economic slowdown and the increasing tension on trade war is expected to keep volatility on the higher side. Your Bank has managed its equity portfolio following a strategy of actively rebalancing the portfolio based on key events, global and domestic market conditions, quarterly earnings of the companies and, their future outlook. In addition to the secondary market, your Bank continues to profitably invest in IPOs to improve the return on the portfolio.

(iii) FOREX MARKETS

The GMU handles the foreign exchange business of your Bank, providing solutions to customers for managing their currency flows and hedging risks through options, swaps and forwards, in addition to providing liquidity to markets. Your Bank is a dominant player in Rupee Spot and Rupee Forward markets and has a sufficiently high market share in customer foreign exchange flows. Your Bank is the leader in providing liquidity in CCIL Fx Clear platform. The volume generated in Currency Futures puts your Bank in the bracket of top three client Banks of exchange houses.

GMU manages the FCNR (B) deposit corpus of your Bank and provides FCNR (B) loans and Pre and Post shipment Export Finance in foreign currency to its customers. Your Bank also provides funding support to Bank’s Foreign Operations whenever required. On technological front, your Bank keeps pace with the best currently in vogue.

Treasury Marketing Group (TMG) is the customer engagement arm of Global Markets and plays a pivotal role in marketing of Treasury Products to Institutional and Corporate clients of your Bank. Treasury Marketing Units located across the country are the face of Global Markets to the customers. They interact with the customers daily, identify their needs, and coordinate with other business units for pricing, product structuring and delivery.

Foreign Investments and Institutional Treasury sales desk is part of TMG. It is responsible for mobilising treasury business from Foreign Portfolio Investors (FPI)/Foreign Direct Investment (FDI) clients and financial institutions.

Private Equity/Venture Capital Fund

The JV setup with Macquarie and IFC in 2008, to manage the US$ 1.2 billion India-focused PE fund, is currently in the exit phase and has successfully exited from two road assets during FY2019.

The Oman India Joint Investment Fund (OIJIF), a JV set up in 2010 in partnership with State General Reserve Fund of Oman, has completed its investments for Fund-I of US$ 100 million. Fund-I has made two full exits and one partial exit. On the other hand, Fund-II with a target corpus of US0 million launched in 2017 has raised commitments of US$ 230 million and has deployed Rs.450 crore across three assets. Fund-II continues to assess various investment opportunities.

During FY2019, your Bank made partial divestment from its strategic investment in National Stock Exchange. Additionally, it made investment commitments in its Alternative Investment Funds portfolio across investment themes such as Special Situations Funds, funds focused on investing in mid-market growth stage companies and technology.

Portfolio Management Services (PMS)

The Bank is the largest retirement benefit fund manager in the country with an impeccable track record. The total AUM as on 31st March 2019 is Rs.5,08,230 crore. Major clients include Employees’Provident Fund Organisation, SBI Retirement Benefit Funds, Coal Mines Provident Fund Organisation, Kendriya Vidyalaya Sanghthan Employees’Provident Fund and Seamen’s Provident Fund Organisation. The Bank also assists its RRBs in managing their SLR Portfolio. However, the PMS activity of the Bank is being closed by 31st March 2019, as per RBI’s directives.

3. COMMERCIAL CLIENTS GROUP (CCG)

A. COMMERCIAL CLIENTS

The Corporate Credit Structure and System in your Bank was revamped to setup, a future ready organisation to manage the risks and sustain growth. There was a reorientation of CAG to focus on the highest priority and quality individual and group relationships with differentiated coverage. The CCG is formed for consolidation of select corporate client accounts across CAG, MCG and NBG verticals based on a criterion decided by your Bank. This includes rationalisation of the remaining CAG branches and existing MCG branches into 47 CCG branches. The CCG vertical is headed by a MD and supported by a DMD, five CGMs and other functionaries.

CGMs in the CCG are assigned as the group relationship owners in order to improve the quality of coverage and enable an integrated view on exposure, earnings amongst others, across the entire group. Your Bank has set up experienced team of ‘Structuring Specialists’to support deal structuring for large proposals across lending, bonds, International Banking, and Structured / Mezzanine Finance.

The Non- food domestic advances level in CCG at the end of FY201 9 was at Rs.4,00,766 crore registering a YoY growth of 3.93 %. The Yield on Advances in CCG has improved from 7.50% as on MarRs.18 to 8.68% as on March 2019 recording a growth of 118 bps. During the same period, business per employee has gone up from Rs.121.73 crore as on March 2018 to Rs.146.72 crore as on March 2019. Profit per employee has improved from Rs.1.98 crore as on March 2018 to Rs.3.99 crore as on March 2019. Cost to Income Ratio has declined by 295 bps during the year going down from 9.25% as on March 2018 to 6.30 % as on March 2019. On the recovery front, CCG was successful in recovering Rs.1,364 crore in Advance Under Collection Account under IBC / NCLT mechanism during the said period.

The group continues to provide a robust platform to its customers for Trade Finance and Forex business.

CCG is at a very advanced stage of launching YONO for Corporates. This is going to provide a very user-friendly digital platform for Corporates for transaction banking as well as Trade Finance Business.

B. PROJECT FINANCE AND LEASING

In contrast to the challenges faced by PFSBU during the previous year, which saw stressed accounts becoming NPA, particularly on Thermal Power, Road sector, Telecom among other sectors, this fiscal year 2019 started with a cautious optimism based on learnings from the past experiences. Policy for funding Renewable, City Gas Distribution and Hybrid Annuity Model in Road sector were framed to mitigate the risks involved. The sectors, which showed signs of revival were Roads, Oil and Gas, Renewable Power, Cement, Fertiliser amongst others. The stressed accounts mainly comprising of Thermal Power, Road sector accounts have been transferred to SARG for resolution. Experienced officials are being recruited from different industries to provide Structuring Solutions to our clients. Chartered Accountants are being employed by your Bank to plug income leakages to boost fee income.

Your Bank’s Special Business Unit known as Project Finance and Structuring (PFSBU) deals with the appraisal and arrangement of funds for large projects in infrastructure and other sectors such as Power, Roads, Ports, Railways, Airports, amongst others. It also covers other non-infrastructure projects in sectors viz. Metals, Fertilisers, Cements, Oil and Gas amongst others, with certain threshold on minimum Project Cost. PFSBU also provides support to other verticals for vetting their large ticket term loan proposals. In order to strengthen the policy and regulatory framework for financing infrastructure, inputs are provided to various Ministries of Government of India and the RBI with respect to lenders views on new policies, Model Concession Agreements and broader issues being faced in infrastructure finance.

Project Finance and Structuring Business Performance:

                                                       (Rs.in crore)

 

FY2017

FY2018

FY2019

Project Cost

83,434

81,701

1,99,317

Project Debt

51,227

58,754

1,33,115

Sanctioned Amount

26,557

19,835

51,351

Syndication Amount

5,809

11,937

31,191

4. STRESSED ASSETS MANAGEMENT

1. Over the last few years, there has been a significant rise in the Gross Non-Performing Assets (GNPA) in the Banking Industry. However, in the first half of FY2019, the GNPA of the SCBs declined, which can be attributed to the following factors:

i.    Resolution of a few high value NPA accounts from the 1st and 2nd RBI list of accounts referred to NCLT under IBC, 2016.

ii.    A revival in economic growth conditions of India in FY2018, leading to control in fresh slippages.

iii.    Favourable outlook of steel sector, which was under stress over past few years. Mainly driven by increase in demand, consumption and simultaneous imposition of anti-dumping safeguard duties as well as minimum import prices, the sector has yielded some good recoveries in NPA.

iv.    Strengthening of due diligence, credit appraisal and loan monitoring systems in the Banking industry.

v.    Significant improvement in the Ease of Doing Business ranking for India at 77th position from 130th rank due to two successive jumps i.e., 30 positions in 2017 rankings and 23 positions in 2018. It reflects the adoption of global best practices in business reforms.

vi.    Stabilisation after facing short term impacts of demonetisation and implementation of GST.

vii.    Greater interest evinced by ARCs and NBFCs in purchase of impaired/ stressed assets backed by foreign investments.

2.    According to the Financial Stability Report of RBI for December 2018, in a sign of possible recovery from the impaired asset load, the asset quality of Banks showed an improvement with the Gross Non-Performing Assets (GNPA) ratio of SCBs declining from 11.5% in March, 2018 to 10.8% in September, 2018. Further, the resilience of the Indian banking system against macroeconomic shocks was tested through macro stress tests. The results of macro tests suggest that the GNPA of all SCBs may come down from 10.8% in September, 2018 to 10.3% by March, 2019. Moreover, sensitivity analysis conducted to study the resilience of SCBs with respect to credit, interest rate, equity prices and liquidity risks predicts that a severe credit shock is likely to impact the capital adequacy and profitability of a significant number of Banks, mostly PSBs.

3.    The movement of NPAs in the Banking industry and recovery in Written-off accounts during the last four years are furnished below:

                                                                                             (Rs.in crore)

 

FY2016

FY2017*

FY2018

FY2019

Gross NPA

98,173

1,77,866

2,23,427

1,72,750

Gross NPA%

6.50%

9.11%

10.91%

7.53%

Net NPA%

3.81%

5.19%

5.73%

3.01%

Fresh Slippages + Increase in O/s

64,198

1,15,932

1,00,287

39,740

Cash Recoveries / Up-gradations

6,987

32,283

14,530

31,512

Write-Offs

15,763

27,757

40,196

58,905

Recoveries in AUCA

2,859

3,963

5,333

8,345

PCR

60.69%

61.53%

66.17%

78.73%

4.    The Government of India in its Reforms Agenda for Responsive and Responsible PSBs has directed creation of a Stressed Assets Management Vertical (SAMV). Your Bank takes immense pride for being a pioneer in establishing a dedicated vertical almost decade and a half back by establishing Stressed Assets Management Group (SAMG) during FY2005. In order to focus towards resolution of stressed accounts, SAMG was renamed as Stressed Assets Resolution Group (SARG), which continues to work as a specialised vertical for efficient resolution of high value NPAs. The structure of SARG has been revamped to give focussed approach for resolution of stressed assets across various sectors. At present, the vertical is headed by a Deputy Managing Director and three Chief General Managers overseeing the specialised sector, AMTs functioning under the leadership of seven General Managers. SARG has turned into a centre of excellence in resolution of NPA and stressed assets. As on March 2019, SARG has 20 Stressed Assets Management Branches (SAMBs) and 56 Stressed Assets Recovery Branches (SARBs) across the country, covering 70.62% and 83.71% of your Bank’s Non-Performing Assets (NPAs) and Advances under Collection Account (AUCA) respectively.

5.    Besides initiating hard recovery measures, SARG introduced certain innovative methods and gave first mover advantage to your Bank in areas such as arranging Mega e-Auction of large number of properties on Pan-India basis, identification of un-encumbered properties of the borrowers / guarantors and arranging for attachment of properties before judgement. The cases referred to NCLT for resolution are monitored at a specialised cell at SARG. A total of 442 cases have been referred to NCLT, out of which 350 cases were admitted. Furthermore, 18 cases have been resolved including a few high value cases from the 1st list of 12 accounts.

6. A significant portion of the recovery in SARG comes from Compromise and Sale of Assets to ARCs. The vertical also implements special OTS schemes (Non-discretionary and Non-discriminatory) from time to time, giving the borrowers a onetime opportunity to settle their dues. A team is set up to look after the sale of Assets to Asset Reconstruction Companies (ARCs) on Cash and Security Receipts (SR) basis.

7. Today, SARG stands as one of the most important verticals of your Bank, when the GNPA of your Bank has already peaked and is on course of a downward journey. Though the credit growth is picking up steadily and performance of treasury operations is dependent on market rates, the importance of NPA resolution/ recovery by SARG is significant as it directly impacts your Bank’s performance. Resolution of stressed assets by SARG presents the following latent income generating avenues for your Bank:

i.    Cash recovery in NPAs and AUCA;

ii.    Up-gradation of accounts;

iii.    Reduction in loan loss provisions;

iv.    Reduced capital requirement;

All the above stated avenues directly contribute to your Bank’s bottom-line. Further, they improve overall asset quality, laying foundation for credit off-take and indirectly contribute towards generation of interest income.

8. Enactment of Insolvency and Bankruptcy Code (IBC) 2016 for resolution of Stressed/NPA assets has provided Banks with a time bound, transparent and effective mechanism to tackle stressed assets. It has led to an efficient price discovery and transparent resolution of accounts resulting in unlocking maximum value in the assets charged to your Bank. A significant portion of recoveries in FY2019 have come through this route. Some of the large accounts from 1st and 2nd list of accounts referred to NCLT directed by RBI have been resolved and a few more are expected with resolution plans already in place. This has helped in strengthening your Bank’s balance sheet and provides the opportunity to deploy the realised funds into income yielding assets.

V. SUBSIDIARIES

As a part of mission to provide the entire gamut of financial services across India, the State Bank Group, through its various subsidiaries, provides a whole range of financial services, including Life Insurance, Merchant Banking, Trustee Business, Mutual Funds, Credit Card, Factoring, Security Trading, Pension Fund Management, Custodial Services, General Insurance (Non Life Insurance) and Primary Dealership in the Money Market.

Non- Banking Subsidiaries:

                                                                                                                                                                  (Rs.crore)

Sr. No

Name of the Subsidiary Company

Ownership (SBI interest)

% of Ownership

Net Profit (Losses) for FY2019

1

SBI Capital Markets Limited (Consolidated)

58.03

100.00

236.27

2

SBI DFHI Limited

131.52

69.04

61.58

3

SBI Mutual Fund Trustee Company Private Limited

0.10

100.00

3.21

4

SBI Global Factors Limited

137.79

86.18

5.35

5

SBI Pension Funds Private Limited

18.00

*60.00

1.89

6.

SBI Foundation

3.99

99.72

0.16

7.

SBI Infra Management Solutions Private Limited

40.00

100.00

(12.00)

*Group holding of SBI is 100% in SBI Pension Funds Pvt. Ltd. (SBI 60%, SBI MF and SBI Capital Markets 20% each)

Non- Banking Subsidiaries: Joint Ventures

                                                                                                                                                               (Rs.crore)

Sr. No

Name of the Subsidiary Company

Ownership (SBI interest)

% of Ownership

Net Profit (Losses) for FY2019

1

SBI Funds Management Private Limited

31.50

63 .00

427.54

2

SBI Cards & Payment Services Private Limited

619.54

74 .00

788 .00

3

SBI Life Insurance Company Limited

621.00

62.04

1327 .00

4

SBI-SG Global Securities Services Private Limited

52.00

65 .00

34.45

5

SBI General Insurance Company Limited

151.00

70 .00

334 .00

6

SBI Business Process Mgt. Services Private Limited*

17.46

74 .00

78 .00

7.

SBI Payment Services Private Limited

4.50

74 .00

(48.84)

* Name of “GE Capital Business Process Mgt. Services Pvt. Ltd.” has been changed to “SBI Business Process Mgt. Services Pvt. Ltd.”

1. SBI CAPITAL MARKETS LIMITED (SBICAP)

                                                                                                                                                              (Rs.crore)

Name of the subsidiary company

Ownership (SBI Interest)

% of ownership

Net Profit (Loss) for FY2019

SBICAP SECURITIES LIMITED (SSL)

96.88

100 .00

57.52

SBICAP VENTURES LIMITED (SVL)

49.98

100 .00

0.52

SBICAP (UK) LIMITED (SUL)

1.72

100 .00

(3.21)

SBICAP (SINGAPORE) LIMITED (SSGL)

61.78

100 .00

(1.65)

SBICAP TRUSTEE CO. LIMITED (STCL)

1.00

100 .00

14.90

SBICAPs is India’s leading investment banker, offering a bouquet of investment banking and corporate advisory services to diversified clients across three product groups - Project Advisory and Structured Finance, Equity Capital Markets and Debt Capital Markets. These services include Project Advisory, Loan Syndication, Structured Debt Placement, Mergers and Acquisitions, Private Equity, Restructuring Advisory, Stressed Assets Resolution, IPO, FPO, Rights Issues, Debt and Hybrid Capital raising. On a standalone basis, SBICAPs posted a pBt of Rs.242.60 crore during FY2019 as against Rs.336.49 crore during the FY2018 and a PAT of Rs.168.19 crore for FY2019 against Rs.236.26 crore in FY2018. On a consolidated basis it has posted a profit of Rs.236.73 crore as against Rs.323.53 crore in the previous year. SBICAPS has not declared any dividend for FY2019 as against 225% in FY2018

A.    SBICAP SECURITIES LIMITED (SSL)

SSL, a wholly owned subsidiary of SBI Capital Markets Limited, besides offering equity broking services to retail and institutional clients both in cash as well as in Futures and Options segments, is also engaged in sales and distribution of other financial products such as Mutual Funds, Tax Free Bonds, Home Loan, Auto Loan, Tractor Loan, amongst others.

SSL has over 100 branches and offers Demat, e-broking, e-IPO, and e-MF services to both retail and institutional clients. SSL currently has over 15 lakh clients. The Company has booked gross revenue of Rs.408.36 crore during FY2019 as against Rs.357.56 crore in FY2018.

B.    SBICAP VENTURES LIMITED (SVL)

SVL is a wholly owned subsidiary of SBI Capital Markets Limited. DFID (Department for International Development) has joined hands with the SBI group to set up the ’Neev Fund’which is being managed by SBICAP Ventures Limited. SVL is acting as the Asset Management Company. SVL has also launched two funds namely Affordable Housing Fund and SME Fund during the year.

First closure of ‘Neev Fund’was on 10th April, 2015 and the final closure happened on 31st March 2019 with final corpus of the Fund being Rs.504.20 crore. Fund has invested in the infrastructure sectors such as renewable energy, water and sanitation, agricultural supply chain in eight identified states of India (Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Odisha, Rajasthan, Uttar Pradesh, and West Bengal).

C.    SBICAP (UK) LIMITED (SUL)

SUL, a wholly owned subsidiary of SBI Capital Markets Limited, is positioning itself as a relationship outfit for SBI Capital Markets Limited in UK and Europe. It has built relationships with FIIs, Financial Institutions, Law Firms, Accounting Firms, amongst others, to market the business products of SBICAP.

D.    SBICAP (SINGAPORE) LIMITED (SSGL)

SSGL, is a wholly owned subsidiary of SBI Capital Markets Limited. It commenced business in December, 2012. It has built relationships with FIIs, Financial Institutions, Law Firms, Accounting Firms, amongst others, to market the business products of SBICAP. It is specialised in marketing of Foreign Currency Bonds and securing clients for SBICAP SEC.

E. SBICAP TRUSTEE CO. LIMITED (STCL)

SBICAP Trustee Co Limited (STCL), is a wholly owned subsidiary of SBI Capital Markets Limited. STCL commenced security trustee business with effect on 1st August, 2008. STCL posted Net Profit of Rs.14.90 crore during FY2019 as against Rs.11.90 crore during FY2018. Moreover, it has launched an Online Will Creation service for the individuals in the name of ‘My Will Service Online’. In addition to this, ‘Trustee Enterprise Management System’- an integrated system to address all the trustee related operations was implemented, thereby becoming the first and only Trustee Company in India to have full automation across all trustee related operations.

2.    SBI DFHI LIMITED (SBIDHFI)

SBI DFHI Limited is one of the largest standalone Primary Dealers (PD) with a Pan India presence. As a Primary Dealer (PD) it is mandated to support the book building process in primary auctions and provide depth and liquidity to secondary markets in G-Sec. Besides Government securities, it also deals in money market instruments, non G-Sec debt instruments, amongst others. As a PD, its business activities are regulated by RBI.

State Bank of India group holds 72.17% share in the Company, which posted a Net Profit of Rs.61.58 crore as on 31st March, 2019 as against Rs.32.07 crore as on 31st March, 2018. Total balance sheet size was Rs.7,206.09 crore as on 31st March, 2019 as against Rs.5,659.46 crore as on 31st March, 2018.

3.    SBI CARDS & PAYMENTS SERVICES PRIVATE LIMITED (SBICPSPL)

SBI Cards and Payment Services Private Limited is a joint venture between State Bank of India and the Carlyle Group wherein State Bank of India holds 74% stake and CA Rover Holdings (An affiliate of Carlyle) holds 26% stake. SBICPSL is an NBFC and issues credit cards in India. State Bank of India increased its stake in the company in December 2017 from 60% to 74% by buying shares from exiting partner GE Capital.

During FY2019, the Company’s Card base has grown by 32% YoY with total number of credit cards reaching to a level of 82.71 lakh as at 31st March 2019. Total Spends on card witnessed a YoY growth of 35% to reach a level of Rs.107,350 crore for the same period. The company is positioned at Rank #2 with 17.2% Spends Share and 17.4% Cards base as per RBI report for February 2019 (Previous Year 16.7% in terms of both Spends and Cards base as per RBI report for March 2018). The company delivered Profit after Tax of Rs.788 crore in FY2019 at YoY growth of 36% (Profit after Tax in FY2018 - Rs.581 crore).

New launches during FY2019:

-    New cobranded ‘Apollo SBI Card’launched offering host of benefits and privileges on health and wellness services.

-    ‘SBI Doctors Card’in association with Indian Medical Association launched exclusively for Doctors.

-    Etihad Guest SBI Card offering best-in-class value combined with word class travel experience to frequent international travellers

-    SME Card offering unmatched value proposition to Small and Medium Enterprises (SME) segment

-    Allahabad Bank SBI Card, Cobranded Credit Card with Allahabad Bank, catering to the customers of Allahabad Bank.

Awards received during FY2019:

-    SBI Card received the Reader’s Digest Trusted Brand Award 2018, for the tenth time in the credit card category.

-    SBI Card won the Best Data Quality Award from CIBIL, for the third consecutive year.

-    SBI Card m-Gurukul won Silver Award in Best Learning, Performance and Capability Project - Sales Training category by LEARNX Foundation, Australia.

-    SBI Card won the ‘Excellent Compliance Performer Award 2018’at the coveted Compliance 10/10 awards.

-    SBI Card was awarded as Best Arrangements - Governance & Compliance Awards 2018 at the Compliance Register Platinum held at London, UK.

-    The SBI Card L&D team was awarded with Learning Innovator Award at the GP Strategies India, Learning Connect Event held at Gurugram.

4.    SBI BUSINESS PROCESS AND MANAGEMENT SERVICES PRIVATE LIMITED (SBIBPMSL)

(Formerly GE Capital Business Process and Management Services Private Limited)

SBIBPMSL is a joint venture between State Bank of India and the Carlyle Group, wherein State Bank of India holds 74% stake and CA Rover Holdings (An affiliate of Carlyle) holds 26% stake. SBIBPMSL provides back end services and solutions to SBICPSL. State Bank of India increased its stake in the company in December 2017 from 40% to 74% by buying out shares from exiting partner GE Capital.

For FY2019, the Company generated PAT of Rs.78 crore at a YoY growth rate of 15% (Profit after Tax in FY2018 of Rs.68 crore).

Initiatives undertaken during FY2019:

-    Vision Plus migration to India completed

-    Excalibur (Collection CRM) Phase-I Go-Live from MarRs.19

-    Chat Bot- ELA introduced- 98% Success rate

5.    SBI LIFE INSURANCE COMPANY LIMITED (SBILIFE)

SBI Life Insurance is a joint venture between State Bank of India (SBI) and BNP Paribas Cardif S. A. The equity shares of the Company are listed on National Stock Exchange of India Limited (‘NSE’) and BSE Limited (‘BSE’).

SBI Life has a multi-channel distribution network comprising an expansive bancassurance channel, including State Bank, the largest bancassurance partner in India, a large and productive individual agent network comprising 123,613 agents as of March 31, 2019, as well as other distribution channels including direct sales and sales through corporate agents, brokers, insurance marketing firms and other intermediaries.

During the year ended March 31, 2019, the Company operated in sound and stable manner, with its sole objective of increasing insurance penetration and concentrating on individual regular business through an active and prudent strategy, sales team maintaining the quality as well as quantity and established a firmer market position. The Company has proven its market leadership in the year ended March 31, 2019 with numero-uno position in Individual New Business Premium among private insurers.

Individual business has always been a part of core strategy of the Company. The company witnessed a 15% growth in Individual New Business Premium (NBP) vis-a-vis the industry growth of 6%. The market share of SBI Life Retail New Business Premium (NBP) among all private players as on 31st March, 2019 is 20.6%. Total New Business of the Company for the year ended FY2019 stands at Rs.13,792 crore; growth of 26%.

The Company continues to maintain the leadership position amongst private players in number of policies issued, which reflects mass coverage and strong market acceptance across geographies amongst life insurer. During the period, total 15,25,439 individual new policies were issued and registered growth of 7%.

During the year, the Company implemented Employee Stock Option Plan (ESOPs) to encourage employee’s performance and incentivise employees.

SBI Life witnessed a PAT of Rs.1,327 crore in FY2019 against Rs.1,150 crore in FY2018, growth of 15%. AUM of the Company recorded a growth of 21% at Rs.1,41,024 crore as on 31st March, 2019 as compared to Rs.1,16,261 crore as on 31st March, 2018.

Leveraging wider reach achieved through its network of 908 offices, SBI Life has systematically brought large rural areas under insurance reach.

Awards and recognitions received during the year include:

1.    For the Financial Year 2018-19, SBI Life was awarded the ‘Life Insurer of the Year 2018 - India’by Insurance Asia News Awards for Excellence 2018.

2.    SBI Life Insurance Company Limited has also been declared as the Winner of the ‘Golden Peacock Award for Risk Management’for the year 2018.

3.    SBI Life won the 2nd Runner Up in the Category of Improvement & Innovation at the 30th Qualtech Prize 2018.

4.    The RIMS India Enterprise RISK Management (ERM) Award of Distinction 2018, organised by the Risk & Insurance Management Society (RIMS), USA, was also awarded to SBI Life in 2018.

5.    Awarded ‘ICAI - Gold Shield’for Excellence in Financial Reporting for FY2018 under the Insurance category

6.    SBI Life Insurance Company Limited received the ‘Smart Insurer Award in the Life Insurance - Large Category’at ET Insurance Summit 2018.

7.    SBI Life Insurance also won the ‘Life Insurance Provider of the Year 2018’by Outlook Money in the Silver Category.

8.    SBI Life Insurance was recognised as ‘The Economic Times Best Brands 2019’by The Economic Times

9.    SBI Life Insurance won the ‘Intelligent Enterprise’award in the ‘Artificial Intelligence’category by Express Computers.

10.    SBI Life Insurance won the awards for ‘Best Blended Learning Program’and ‘Chief Learning Officer of the Year’at TISS Leapvault CLO Awards 2018.

11.    SBI Life Insurance won ‘Corporate Star Award for Best Training for Employees/Associates’in MICE activities by MTM.

6. SBI FUNDS MANAGEMENT PRIVATE LIMITED (SBIFMPL)

SBIFMPL, the Asset Management Company of SBI Mutual Fund, is amongst the fastest growing AMCs with a growth of over 30% against the industry average of 6.20% in 2018-19. In the last three years, SBIFMPL has achieved a CAGR of 39% against the industry average of around 22%. The Fund has moved up 2 notches in 2018-19 and has achieved 3rd rank, from being at 5th rank in the beginning of the year as per Quarterly Average Asset Under Management (QAAUM). SBIFMPL has one of largest investor base with over 95 lakh investors with 12 lakh direct investors and over 47,000 institutional investors including 1210 retirement funds. SBIFMPL is the Largest ETF manager in the country.

SBIFMPL posted a PAT of Rs.427.54 crore during the period ended March 2019 as against Rs.335.82 crore earned during the year ended March 2018 under Indian Accounting Standard (Ind AS). The average “Assets Under Management” (AUM) of the Company during the quarter ended March 2019 were Rs.2,83,807 crore with a market share of 11.59% as against the average assets under management of Rs.2,17,649 crore with a market share of 9.44% during the quarter ended March, 2018. The Company has a fully owned foreign subsidiary viz. SBI Funds Management (International) Private Limited, which is based at Mauritius and manages Offshore Fund. SBIFMPL also provides Portfolio Management services (PMS) and Alternative Investment Funds (AIF).

7.    SBI GLOBAL FACTORS LIMITED (SBIGFL)

SBIGFL is a leading provider of factoring services for domestic and international trade. SBI holds 86.18% share in the Company. The Company’s services are especially suitable for MSME clients for freeing up resources locked in book debts. By virtue of its membership of Factors Chain International (FCI), the Company is able to ameliorate credit risk from export receivables under the 2-factor model.

The Company reported a PBT of Rs.9.47 crore during the year ended FY2019 against Previous Year PBT of Rs.2.08 crore. In current FY PAT is Rs.5.35 crore against Previous Year Loss of Rs.3.24 crore. Turnover for 12 months ended FY2019 is Rs.4,387 crore as compared to turnover of Rs.3,555 crore in previous year (i.e. an increase of 23%). Funds in use (FIU) as on 31st Mar 2019 is Rs.1,374 crore as compared to Rs.1,276 crore as on 31st Mar 2018. Turnover in Export Factoring -2 Factor Model for 12 months ended FY2019 is equivalent to EUR 54 Mio (Previous Year EUR 59.15 mio). In I NR terms, the EF turnover touched Rs.440 crore for 12 months ended FY2019, as against Rs.452 crore in previous year.

8.    SBI PENSION FUNDS PRIVATE LIMITED (SBIPFPL)

SBIPFPL has been appointed as the Pension Fund Manager (PFM) along with seven others to manage the pension corpus under National Pension System (NPS). SBIPFPL is one of the three PFM appointed by the Pension Fund Regulatory & Development Authority (PFRDA) for management of Pension Funds under the NPS for Central Government (except Armed Forces) and State Government employees and one of the eight PFMs appointed for management of Pension Funds under the Private Sector. The total Assets Under Management (AUM) of the company as on 31st March, 2019 was Rs.1,21,959 crore (YoY growth of 37%) against Rs.89,283 crore on 31st March, 2018.

The Company maintained lead position amongst PFMs in terms of AUM in both Government and Private Sectors. The overall AUM market share in Private Sector was 59%, while in the Government Sector it was 35%.

The Company was adjudged “Silver Award” Winner as the Pension Manager of the year 2018 by Outlook Money. Awards by Outlook money have been adjudged to the Company for 4th consecutive year in a row.

9. SBI GENERAL INSURANCE COMPANY LIMITED (SBIGIC)

SBIGIC is a joint venture between State Bank of India and IAG Australia in which State Bank of India holds a 70% stake. At its Executive Committee meeting of the Board, your Bank has approved the sale of 86.2 Lakh shares of Rs.10 each, equaling to 4% stake in its subsidiary SBI General Insurance Company Limited (SBIGIC) for Rs.482 crore. The proposed transaction values SBIGIC at over Rs.12,000 crore. The transaction completion is subject to regulatory approvals.

The cornerstone of the Company’s growth aspiration is focused on the Banca channel whilst developing other channels and products that meet business objectives and drive profitable growth. The Company has entered in to strategic tie-ups with four large car manufactures to drive growth in the Motor portfolio. Gross Written Premium (GWP) stood at Rs.4,717 for FY2019.

In the ninth year of operation, SBIGIC had achieved a profit, to the tune of Rs.334 crore. The Company recorded 32.83% of growth in GWP YoY against an industry growth of 12.95% including crop whereas excluding Crop, SBIGIC recorded growth of 12.4% against Industry growth of 12.6% for FY2019. SBIGIC has grown by 115.6% in Crop Insurance in FY2019 by participating in the PMFBY schemes and extending its geographies. The overall market share among all general insurance companies stands at 2.77% and 5.77% among private insurers (Excluding Standalone Health Insurers). The Company’s market ranking stands 13th in the industry and 8th among the private players (Excluding Standalone Health Insurers) in FY2019. SBIGIC occupies 2nd position in “Personal Accident” both amongst private insurers and overall in the industry in FY2019. The company ranks 3rd in “Fire” among private insurers and 6th position in the industry in FY2019. Share of health business decreased from 13.3% to 10.9%. However, there is a growth to the tune of 8.6% for FY2019.

SBI General was awarded “Best General Insurance Company” and “Best Growth in General Insurance” at the Emerging Asia Insurance Awards 2018 organised by Indian Chamber of Commerce at Bangkok. SBI General has been conferred the title “General Insurance Company of the Year” at the India Insurance Summit & Awards 2019, which is the biggest strategic business summit for the entire insurance industry in India. SBI General has won the Gold Award in the category ‘Non-Life Insurance Provider of the Year 2018’at the 17th edition of Outlook Money Awards. SBI General newsletters, ‘Network’and ‘Connect’, have received an award for “Best Content in Email Marketing Campaign for E-Newsletters” at the India Content Leadership conference and awards 2018, organised by Inkspell Media. The Company Chief Risk Officer was awarded the ‘CRO of the year’in the 2nd Edition CRO Leadership Summit and Awards 2019.

10. SBI SG GLOBAL SECURITIES SERVICES PRIVATE LIMITED (SBI-SG)

SBI-SG, a joint venture between State Bank of India and Societe Generale with 65% holding by SBI. The Company was set up to offer high quality custodial and fund administration services to complete the bouquet of premier financial services offered by the SBI Group. SBI-SG commenced commercial operations in 2010. The Company’s Net Profit was Rs.34.45 crore as on 31st March 2019 as against Rs.26.03 crore as on 31st March 2018. Accumulated profit is Rs.79.90 crore.

Assets Under Custody as on March 2019 rose to Rs.5,40,919 crore from Rs.4,65,231 crore as on March 2018, while the Average Assets Under Administration were at Rs.3,18,197 crore in March 2019 as against Rs.2,53,867 crore in March 2018.

SBI-SG has been rated as one of the leading custodians in India in the Global Custodian magazine’s Agent Banks and Emerging Markets Survey 2017. SBI-SG has also been rated #1 custodian in India in the Global Investor/ISF Sub - Custody survey for 2017.

11.    SBI INFRA MANAGEMENT SOLUTIONS PRIVATE LIMITED (SBIIMS)

The SBIIMS is a wholly owned subsidiary incorporated on 17th June 2016. The Company has since expanded its operation pan India w.e.f., 1st July 2018 by setting 17 Circles Infra Offices at all SBI LHO Centres. Its Head Office is located at Raheja Chamber, Ground Floor Free Press Journal Marg Mumbai 400021.The Company is in the process of stabilising its operation at pan India level.

The aim of the company is to give specialised services on Civil, Construction, Electrical, Facility Management, Leasing of Premises etc. It also aims at relieving SBI Officials from dealing with Premise and Facility related issues and compliment it by giving specialised inputs. The company also instrumental in saving cost, manpower, time, and energy used to be consumed by SBI.

12.    SBI PAYMENT SERVICES PRIVATE LIMITED (SBIPSPL)

SBI Payment Services Private Limited (“SBIPSPL”) was incorporated on February 12, 2010 as a wholly owned subsidiary of State Bank of India (“SBI”) and was supporting SBI in conducting Merchant Acquiring Business (“MAB”). In order to build state-of- the-art technology platform domain expertise, innovation centre to design new products, improve customer service and to be future ready, SBI initiated the process to induct a global domain player in SBIPSPL.

During the year, SBI transferred MAB to SBIPSPL and selected Hitachi Payment Services Private Limited (“HPY”), indirect wholly owned subsidiary of Hitachi Limited Japan, as its Joint Venture partner with 26% stake.

The digital payments landscape in India is evolving at a rapid rate and SBIPSPL is playing an effective role in building momentum for transforming India through digitalisation of the economy. In sync with the focus of the Government of India to create a less-cash economy, SBIPSPL’s digital payment acceptance infrastructure is spread across the length and breadth of the country. During the year, a multi option payment acceptance device i.e., MOPAD was launched for facilitating payments via Cards/Bharat QR/UPI on a PoS terminal.

As on 31st March, 2019, SBIPSPL has deployed 5.75 lakh PoS terminals, 4.18 lakh Bharat QR code and on-boarded 6.31 lakh merchants on BHIM-Aadhaar-SBI and acquired nearly 54 crore transactions during FY2019 with 24% Y-o-Y growth. The number of merchant payment acceptance touch points crossed 16.2 lakh. SBIPSPL has reported an EBITDA of Rs.14.19 crore as on March 31, 2019

Following services are also being offered by SBIPSPL to cater to the requirements of various merchants:

-    DCC-Dynamic Currency Conversion

-    EMI (Equal Monthly Installments)

-    Cash@POS

-    NFC acceptance on PoS terminals

-    Acceptance of AMEX/DINERS/DFS/ JCB/UPI Cards.

-    Electronic Toll Collection.

SBIPSPL is providing customised solutions to premium customers to suit their requirements by integrating with their technology platforms. Some of the notable integrations are with Indian Railways, SOUTHCO (Odisha), APDCL (Assam Power Distribution Co. Limited), Goa - GBSS project (Government of GOA), Cyber Treasury (Govt of Madhya Pradesh), IGR (Inspector General of Registrar) Pune, Noida and Nagpur Metro.

13. SBI FOUNDATION

SBI Foundation was established by State Bank of India in 2015 as a Section VIII company under Companies Act (2013) to undertake the CSR activities of SBI and its Subsidiaries in a planned and focused manner.

With an aim to give back to the society by working towards the socio-economic well-being of the marginalised and vulnerable communities, your Bank is actively working towards impacting people on grassroots level across PAN India with a vision to provide ‘Service Beyond Banking’.

SBI Foundation is presently working on various projects to build a momentum for a transforming India by creating an inclusive development paradigm that serves all Indians without any discrimination based on region, language, caste, creed, religion amongst others. The total CSR spend of SBI Foundation for FY2019 was Rs.16.46 crore. The grants received from Bank’s subsidiaries amounted to Rs.16.66 crore.

The Foundation undertook CSR activities in the following focus areas:

A. HEALTHCARE

SBI Foundation is committed towards contributing positively to United Nation’s Sustainable Development Goals (SDGs)-Goal#3: Good Health and Well Being by bringing about positive change in the lives of underprivileged sections of society by providing free access to quality healthcare. To contribute towards improving the health scenario, your Bank has continued the support to following CSR projects through SBI Foundation:

-    Life: An initiative to prevent and control Thalassemia disease by conducting free tests for around 20,000 people. 5.9% of the tested people were found to be positive.

-    Gift Hope, Gift Life: An initiative to augment deceased Organ Donation in India with a 24/7 toll free national helpline. Moreover, healthcare professionals (Doctors, Nurses, Surgeons amongst others.) were trained and massive awareness programs were conducted during the year.

-    Cancer Care: An initiative to prevent and control Breast, Cervical and Oral Cancer among women by conducting free Biopsy, Mammography and Colposcopy tests.

-    Darpan: An initiative to mitigate damages of Sickle Cell Anaemia disease by conducting free tests.

-    Anugraha: An initiative to provide support for home-based Hospice and Palliative Care services for the rural poor community.

-    Umeed: An initiative to provide crucial preventive care information for safe motherhood from gestation period to delivery and safe childhood for new born babies up to one year of age by use of mMitra- a free mobile voice call service.

B.    EDUCATION

Education is one of the most powerful and proven vehicles to bring transformational change in the development of marginal segment. It plays a vital role in improving the standard of living of an individual and is viewed as an effective tool for bringing socio-economic changes. However, scarcity of resources and lack of infrastructure are the major hindrances in the education sector in India. SBI Foundation is committed to contribute positively to United Nation’s Sustainable Development Goals (SDGs) Goal#4: Quality Education. Through SBI Foundation, your Bank has initiated various projects as mentioned below:

Peepul School Adoption Program: Under this project, a Model school is set up in a public private partnership (PPP) aiming to raise the standard of education and improving learning outcomes in government schools through a total school transformation approach.

Khelwadi: Under this project, 20 Khelwadis are being operated focusing on the aspects of education such as personality building, creative thinking amongst others, for an all-round development of students.

C.    ENVIRONMENT AND SUSTAINABILITY

State Bank of India is committed towards environment protection and to reduce its carbon footprints. Hence, your Bank prioritises responsible interaction with environment to avoid depletion and degeneration of natural resources to maintain its long-term quality.

Waste to gold: An initiative to motivate and develop the skills of vulnerable youth to address waste management in the city; and develop small sustainable businesses for their livelihood.

SBI Corbett: An initiative to provide villages a sustainable waste management system and conduct trainings of SHG Workers to spread awareness in nearby schools and hotels.

Swachh Belur Math: SBI Foundation supported Ramkrishna Mission for construction of 201 toilets at new Pilgrims Abode in Belur Math that will serve 13 lakh visitors each year. To provide sanitation facilities to visitors of the holy Ramkrishna Mission that witnesses thousands of pilgrims a day, SBI Foundation contributed Rs.1.67 crore to this project.

Beat Plastic Pollution: State Bank of India’s Local head Office (LHO) Mumbai organised Cleanliness Drive with the theme ‘Beat Plastic Pollution’, on the eve of “World Environment Day” at Dadar Beach near Chaitya bhoomi. More than 125 staff members actively participated under the leadership of Mr P. K. Gupta, MD (Retail and Digital Banking) and cleaned the plastics and other wastes on Dadar Beach and collected 2 tractor load of garbage.

Plastic free organisation: State Bank of India announced to be a plastic free organisation as part of Bank’s sustainability commitment. This major initiative by your Bank is in sync with the Honourable Prime Minister’s Swachh Bharat Abhiyan and the national commitment to abolish single use plastic by the year 2022. In the next 12 months, SBI will be undertaking phase wise steps to become plastic free. PET water bottles will be replaced with water dispensers at all its offices and meetings. Your Bank will also start using standardised paper folders replacing the plastic ones. Moreover, it will replace single use plastic cutleries and containers in its canteens with those made from biodegradable substances.

D. ARTS, CULTURE,

HERITAGE AND OTHERS

India has a rich legacy of arts, culture and heritage and your Bank is committed to preserve them.

-    Swachh Iconic CSMT: To achieve the dual goals of preservation of culture and heritage and contribute to “The Swachh Iconic Places” initiative, your Bank has initiated a project named “SBI Swachh Iconic CST”, an initiative for Conservation and Restoration of South and East Fagade of the Heritage Building at Chhatrapati Shivaji Maharaj Terminus Mumbai, A UNESCO World Heritage Site.

-    SBI Eklavya: An initiative to provide basic sports facility to the children studying in ashram schools.

E. FLAGSHIP PROGRAMS

SBI Youth for India Fellowship program: SBI Youth for India (YFI) is a Fellowship program initiated, funded and managed by the SBI Foundation, SBI Capital Markets and SBI General Insurance. It provides a framework for India’s best young minds to join hands with rural communities, empathises with their struggles and connects with their aspirations.

Under the initiative, SBI Foundation has partnered with the reputed NGOs, engaged in the developmental work of rural areas, to deploy the youth enrolling for the fellowship, for conceiving and working on innovative projects. YFI has an alumni base of 254 passionate change makers, 70% (approximately) of Alumni are associated with the development sector after the fellowship.

Centre of Excellence for Persons with Disabilities (PwDs) (CoE):

Majority of differently abled persons can lead a better quality of life if they have equal opportunities and effective access to rehabilitation measures. There was an increasing recognition of the abilities and emphasis on mainstreaming them in the society based on their capabilities. CoE, conceptualised with an aim to be a centralised support centre for differently able persons, works on empowering PwDs through skill enhancement to make a significant and measurable improvement that enables a more productive and satisfying life by optimising their cognitive, physical, social, and vocational functioning.

CoE has conducted 11 inclusive training programs for employees with disabilities and their trainers having 10 public sector Banks as participants. CoE has also signed MoUs with Bank of Baroda, Union Bank of India, Vijaya Bank and State Bank of India for the institutionalisation of inclusion and empowerment of employees with disabilities.

CoE has set up a skill centre under its ‘Swabhiman’project for placement linked skill development of PwDs. It has also initiated project ‘Shravan Shakti’to support surgery for fitment of Cochlear implants for hearing impaired children.

Gram Seva:

For the holistic development of the villages, SBI Foundation has adopted 10 Gram panchayats covering 50 of villages in six states of India. Integrated village development is aimed to promote education for all, environment protection, livelihood development, digitisation in Gram Panchayat, skill development and improvement of preventive and primary health care in villages. Over 11,000 families are benefiting from this project.

The objectives of the flagship program are:

-    To link and leverage the specific government schemes/services to villages

-    To lay emphasis on digitalisation and create awareness about online banking

-    Improve the basic infrastructure of villages

-    Encourage Panchayat/Village selfgovernance and create environment for participatory efforts by the people for rural asset creation and community development.

SBI Foundation has won two national level awards during this year for its CSR initiatives.

Name of the

Category

Award

 

SKOCH CSR

Best CSR Practices

Awards

(Gold) - For Gift Hope,

 

Gift Life project

ICC Social

Empowering Rural

Impact

Population- For Gram

Awards

Seva project

14. REGIONAL RURAL BANKS (RRBs)

Ownership Percentage of SBI In RRBs sponsored by SBI

35.00%

1.

Andhra Pradesh Grameena Vikas Bank

35.00%

2.

Arunachal Pradesh Rural Bank

35.00%

3.

Chhattisgarh Rajya Gramin Bank

35.00%

4.

Ellaquai Dehati Bank

35.00%

5.

Langpi Dehangi Rural Bank

40.37%

6.

Madhyanchal Gramin Bank

35.00%

7.

Meghalaya Rural Bank

35.00%

8.

Mizoram Rural Bank

35.00%

9.

Nagaland Rural Bank

35.00%

10.

Purvanchal Bank

35.00%

11.

Saurashtra Gramin Bank

37.15%

12.

Utkal Grameen Bank

35.00%

13.

Uttarakhand Gramin Bank

35.00%

14.

Vananchal Gramin Bank

35.00%

15.

Rajasthan Marudhara Gramin Bank

35.00%

16.

Telangana Grameena Bank

35.00%

17.

Kaveri Grameena Bank

RRBs Sponsored by SBI

With more than 2/3rds of our country’s population living in Rural - India, it presents a huge yet under tapped opportunity for the Indian Banking Sector. Our large network of sponsored Regional Rural Banks (RRBs) is well placed, to play a larger role and have a great potential to address this scenario. Regional Rural Banks have a distinct competitive advantage, due to their large account base and decades of trust-earning service tradition, resulting in close proximity to the rural customers.

-    The State Bank has sponsored (17) Regional Rural Banks operating at regional levels in (17) different States. These RRBs have a combined branch strength of (5,647) spread across (215) Districts. (as on 31st March 2019).

-    State Bank of India holds 35% stake in each of them except Madhyanchal Gramin Bank (40.37%) and Utkal Grameen Bank (37.15%) as on 31.03.2019 due to delayed infusion of proportionate share capital by Govt of India, with Government of India holding 50% and the respective State Governments holding the remaining 15% stakes.

-    The Sponsored RRBs of SBI are on CBS platform and offer banking services on par with any other commercial Banks operating in the country. The Banks have adopted the best practices and are well placed to handle the ever-evolving demands of customers, particularly in Rural and Semi-urban space, through their customer centric approach.

Business Highlights of FY2019 (As on 31.03.2019):

-    The aggregate deposits and advances of the (17) RRBs (sponsored by the Bank) as on (31st March 2019) stood at C103,258 cr) and C61,741 cr) respectively.

-    During the year under review, despite the persistently challenging macroeconomic environment, the Bank improved its business, with Deposits growing by (10.80%) and Advances by (10.64%) over the previous year. (up to 31st March 2019). As a planned strategy to diversify to the portfolio, RRBs expanded their Housing Loan exposure by 26% to take the portfolio to Rs.6599.00 cr.

-    During FY2019, the RRBs together have posted a Net-Loss of C113.81 crs) due to substantial provision of Pension. RRBs have generated gross profit of Rs.1846.75 cr (Profit before Tax and Pension provisions) which was 88% higher than the previous year. However, on account of Provisions towards Pension liability (Rs.1811.76 cr), the Post Tax Net Profit slid to (-) Rs.113.81 cr as against Net Profit of Rs.584.03 crs in FY20118. The Banks continue to focus on improving earnings from their core banking business, strengthening the fee income streams, and maintaining control on operating costs.

-    The combined Gross NonPerforming Assets ratio of the RRBs has improved to (6.92%) in current Financial year as against 8.60% in the previous FY. Net NPA stands at (3.35%) as against (4.53%) in the previous FY.

-    Business per employee during the FYimproved to C7.48 Crs) (as on 31st March 2019) as against Rs.6.78 Crs in the previous FY.

Major Developments in FY2019:

The year under review witnessed several significant events, some of which are listed below:

-    In January 2019, in line with a Government of India decision to amalgamate all RRBs operating in the state of Punjab, ‘Malwa Gramin Bank’, an RRB in which the Bank had 35% stake, was amalgamated with Punjab Gramin Bank, an RRB sponsored by Punjab National Bank, through a scheme of arrangement as facilitated by Ministry of Finance, Government of India. This event brought down the number of Sponsored RRBs in our fold from 18 to 17.

-    Similarly, Govt. of India has issued notification for amalgamating two of our RRBs namely Kaveri Grameena Bank and Langpi Dehangi Rural Bank with RRBs sponsored by other Banks w.e.f. 01.04.2019.

-    The 17 RRBs marginally expanded their branch network to reach 5,647 branches, as against 5,620 branches at the beginning of the year. The existing Branch network is expected to work more efficiently in the upcoming years, thanks to the introduction of Asset Management Hubs (AMHs) - a Centralised Credit Processing system.

-    The RRBs have opened 168 Asset Management Hubs (AMHs) in the Financial Year, which will henceforth facilitate in processing and sanction of quality loan proposals, thus helping to improve the asset quality of the Banks.

-    An RRB IT Tech Cell has been established at Hyderabad. This hub will act as a single point ‘solution center’for undertaking and responding promptly to the IT requirements/challenges faced at the RRBs. Several of the RRBs have well established in-house IT cells and the Hub will act as a control center for standardising, exchanging and facilitating collaborative development of IT products and solutions between the RRBs.

Schedule V, Part B - Management Discussion and Analysis:

In terms of compliance with the SEBI (Listing Obligations & Disclosure Requirements) (Amendment) Regulations 2018, following ratios have changed by more than 25%, as per details given below:

(In %)

Mar-18

Mar-19

Variation (bps)

% Change

Net Profit Margin

-2.47

0.31

278

+112.55

Return on Net worth

-3.78

0.48

426

+112.70

Net Profit Margin:

The Net Profit has registered YoY growth of 113.17% (from Loss of Rs.6,547 Cr in FY18 to Net Profit of Rs.862 Cr during FY19) as against YoY growth of only 5.49% in Total Income (from Rs.2,65,100 Cr in FY18 to Rs.2,79,644 Cr in FY19).

Return on Net worth:

The Net Profit has registered YoY growth of 113.17% (from Loss of Rs.6,547 Cr in FY18 to Net Profit of Rs.862 Cr during FY19) as against a meager YoY growth of 0.77% in Net worth of the Bank (from Rs.1,77,191 crore in FY18 to Rs.1,78,552 crore in FY19).

VI.RESPONSIBILITY STATEMENT

The Board of Directors hereby states:

i.    that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

ii.    that they have selected such accounting policies and applied them consistently and made judgements and estimates as are reasonable and prudent, so as to give a true and fair view of the state of affairs of your Bank as on the 31st March 2019, and of the profit and loss of Your Bank for the year ended on that date;

iii.    that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Banking Regulation Act, 1949 and State Bank of India Act, 1955 for safeguarding the assets of your Bank and preventing and detecting frauds and other irregularities;

iv.    that they have prepared the annual accounts on a going concern basis;

v.    that the internal financial controls had been laid down, to be followed by your Bank and that such internal financial controls are adequate and were operating effectively; and

vi.    that proper system had been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

VII. ACKNOWLEDGEMENT

During the year, Shri B. Venugopal was elected by the Shareholders as Director on the Board u/s 19(c) of the SBI Act, 1955 w.e.f. from 7th June 2018.

Shri Arijit Basu was appointed as Managing Director on the Board w.e.f. 25th June 2018 and Shri B. Sriram resigned from the Board w.e.f. 29th June 2018. Smt Anshula Kant was appointed as Managing Director on the Board w.e.f. 7th September 2018.

Dr Girish Ahuja and Dr Pushpendra Rai have been re-nominated by GOI as Directors u/s 19(d) of the SBI Act, 1955 w.e.f. 6th February 2019.

The Directors place on record their appreciation for the contributions made by the outgoing Managing Director, Shri B. Sriram to the deliberations of the Board. The Directors welcome the new Managing Directors, Shri Arijit Basu and Smt Anshula Kant and Director, Shri B Venugopal on the Board.

The Directors also express their gratitude for the guidance and co-operation received from the Government of India, RBI, SEBI, IRDA and other government and regulatory agencies.

The Directors also thank all the valued clients, shareholders, Banks and financial institutions, stock exchanges, rating agencies and other stakeholders for their patronage and support and take this opportunity to express their appreciation for the dedicated and committed team of employees of the Bank.

                                                                                                              For and on behalf of the

                                                                                                          Central Board of Directors

                                                                                                                                     Chairman

Date: 10th May 2019

Source : Dion Global Solutions Limited
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