2 17-18
2.25% 27.75% Return on Assets Cost to Income
Rs 750.50 Cr. Rs 503.01 Cr. Operating Profit Net Profit
1.36% 15.59% Gross NPAs reduced from 1.69% CRAR
Rs 2252.82 Cr Net Worth
We don't find customers for our products. We find products to our customers. Empowering Rural Lives
we are with you!
13th Annual Report 2017-18
With Best Compliments from V. Narasi Reddy Chairman Andhra Pradesh Grameena Vikas Bank Head Office, Warangal - 506 001
01 Annual Report 2017-18 we are with you!
What's inside
S.No. Particulars Page No.
1. Vision, Mission & Values 03
2. Letter of Transmittal 04
3. Geographical Area & Regional Offices 05
4. Board of Directors 06
5. Executives Team 07
6. Heads of Departments & Regional Mangers 08
7. Our Mentors 09
8. Our Regulators & Supervisors 10
9. Highlights 2017-18 11
10. Chairman's Message 12
11. Key Performance Indicators 14
12. Awards 18
13. Board of Directors Report 21
14. Auditor's Report 69
15. Balance Sheet, Profit & Loss 71 Account and Schedules
02 Annual Report 2017-18 we are with you!
Vision, Mission and Values VIsIOn we are with you! Be the preferred Bank of Rural India for development and transformation.
MIssIOn Be a financial heart, providing Sustainable livelihood to rural population through Innovative Financial and Technology solutions.
VALuEs Respect to Systems and Procedures / Good Governance / Transparency / Service with compassion / Ethics / Team work and People Focus.
03 Annual Report 2017-18 we are with you!
Letter of Transmittal
Andhra Pradesh Grameena Vikas Bank Head Office : Warangal
Date: 30.06.2018
The Secretary, Ministry of Finance, Dept. of Financial Services Banking Division, Government of India Jeevan Deep Buildings, Parliament Street, New Delhi-110001
Dear Sir, In accordance with the provisions of Section 20 of the Regional Rural Banks Act 1976, I forward herewith the following documents. A Report of Board of Directors as to the Bank's working and its activities during the period 1st April 2017 to 31st March 2018. A copy of the audited Balance Sheet and Profit and Loss Account for the year ended 31st March 2018. A copy of the Auditor's report in relation to the Bank's accounts for the period 1st April 2017 to 31st March 2018.
Yours faithfully,
(V. Narasi Reddy) Chairman
04 Annual Report 2017-18 we are with you!
Geographical Area & Regional Offices
Regions in Andhra Pradesh Srikakulam Warangal Saraswathi Complex, Baker sahed peta ABK Mall, Srikakulam 532001, Ramnagar, Hanamkonda Tel 08942-221041, Fax 08942-221040 Warangal 506001 [email protected] Tel 0870-2577884 Fax 0870-2568010 Vizianagaram [email protected] 8-12-64/1, Beside Himagiri Theatre, Vizianagaram 535002, Mahabubnagar Tel 08922-273956, Fax 08922-274221 8-3-3/5/F, Mettugadda [email protected] Mahabubnagar 509001 Tel 08542-242861 Visakhapatnam Fax 08542-242862 52-14-77/1, APHSC Building, [email protected] Near Eenadu office, Seethammadhara Visakhapatnam Sangareddy Tel 0891-2713942, Fax 0891-2746341 Opp. Inspection Bunglow, [email protected] Sangareddy 502001 Tel 08455-276263 Parvathipuram Fax 08455-276603 Vizianagaram Dist. 1435-27-112, Ist Floor, [email protected] By Pass Road, Opp. Sai Ram College Tel : 08936-220498 Ashoknagar [email protected] Ramachandrapuram Mandal Dist. Sangareddy 502032 Tel 040-20040773 Regions in Telangana State Fax 040-23020238 [email protected]
Khammam Bhadrachalam Wyra Road, Khammam 507001 Temple Road, Bhadrachalam 507111 Tel 08742-226816, Fax 08742-228972 Dist. Kothagudum. [email protected] Tel 08743-231492 Fax 08743-231020 Nalgonda [email protected] Ramgiri, Nalgonda 508001 Tel 08682-229943, Fax 08682-229945 [email protected]
05 Annual Report 2017-18 we are with you!
Board of Directors
Shri V. Narasi Reddy Chairman (General Manager on deputation from State Bank of India)
Nominees of Central Government under Section 9 (1) (a) of the Regional Rural Bank's Act, 1976 Vacant Vacant
Nominee of Reserve Bank of India under Section 9 (1) (b) of the Regional Rural Bank's Act 1976 Shri M S Harishankar Asst. General Manager, FIDD, Reserve Bank of India, Hyderabad Nominee of NABARD under section 9 (1) (c) of the Regional Rural Bank's Act, 1976. Shri V.S. Gupta, Deputy General Manager NABARD, TSRO, Hyderabad
Nominees of State Bank of India under Section 9 (1) (d) of the Regional Rural Bank's Act, 1976 Shri S. Ganesan General Manager (RRBs), State Bank of India, Corporate Centre, Mumbai Shri Kasi Srinivas Deputy General Manager (FI&MF) State Bank of India, LHO, Hyderabad
Nominees of State Government under Section 9 (1) (e) of Regional Rural Bank's Act, 1976
Ms. K. Amrapali, IAS Sri KVV Satyanarayana, IRAS Collector & Dist. Magistrate, Special Secretary to Govt. (B&IF) Finance Department, GOAP, Amaravathi. Warangal(urban)
06 Annual Report 2017-18 we are with you! Executive Team
Shri V. Narasi Reddy Chairman
Shri M. Satyanarayana Shri T.V. Krishna Reddy General Manager-I General Manager -II
Shri G. Nagaraju Shri K. Ravikiran General Manager - III General Manager - IV
07 Annual Report 2017-18 we are with you! Heads of Departments
Sri S.L.N. Prasad Sri P. Purnachandra Rao Sri M.B T Reddy Sri K Vinod Reddy Sri A S Sarma AGM (Credit & RRM) AGM (I&A) AGM (FIC) Chief Manager Per & HR Chief Manager, P&D
Sri TVV Prabhakar Sri G. Sreedhar Reddy Sri K. Amarender Reddy Sri P. Murali Mohan Rao Chief Manager, Accounts Chief Manager, IT Chief Manager, SLC Chief Manager V&DP On Deputation from SBI Regional Managers
Sri V. Raghunath Reddy Sri BRV Manoj Kumar Sri D.Vishwaprasad Sri Mallempati Ravi Sri Ch Ramulu AGM & RM, Nalgonda AGM & RM, Ashoknagar AGM & RM, Warangal AGM & RM, Sangareddy RM, Khammam
Sri P. Raju Sri M Manohar Reddy Sri P. Suryanarayana Sri L Sudheer Reddy Sri B Srinivasa Murthy Sri D Rama Rao RM, Mahabubnagar RM, Bhadrachalam RM, Visakhapatnam RM, Vizianagaram RM, Srikakulam RM, Parvathipuram
08 Annual Report 2017-18 we are with you!
Our Mentors
Shri Rajnish Kumar Chairman State Bank of India Corporate Centre, Mumbai
Shri Dinesh Khara Managing Director State Bank of India Corporate Centre, Mumbai
Shri Ravi Nandan Sahay Chief General Manager (A &S), State Bank of India Corporate Centre, Mumbai
09 Annual Report 2017-18 we are with you!
Our Regulators & Supervisors
Shri R. Subramanian Regional Director RBI, RO, Hyderabad
Dr.P.Radhakrishnan Shri K. Suresh Kumar Chief General Manager, Chief General Manager, NABARD, TSRO, Hyderabad NABARD, AP RO, Hyderabad
10 Annual Report 2017-18 we are with you!
Highlights 2017-18 Total Business of the Bank has reached a level of Rs 28650.33 crores with a growth of Rs 3463.22 cr @ 13.75%. Deposits at Rs. 14333.63 Crore increased by Rs 1515.05 Crore at 11.82% from Rs 12818.58 Crore. The share of CASA has increased to 42.15% from 41.05% Advances at Rs.14316.70 Crore increased by Rs 1948.16 Crore at 15.75% from Rs.12368.53 Crore. Net profit at Rs. 503.01 Cr @ 42.90 % (Rs 351.99 Crore 57.51%) Gross NPAs reduced to Rs 195.64 Crore (1.36%) as on 31.3.2018 from Rs 209.74 Crore (1.69%). Net NPAs reduced to Rs.28.03 Cr (0.20%) from Rs.87.57 Cr (0.72%). Provision Coverage Ratio increased to 85.67% from 58.27% Cost of deposits decreased to 6.30% as on 31.3.18 from 6.89%. Business per Branch Rs.37.30 cr (Rs 32.80 Cr) Business per Employee Rs 9.07 cr (Rs 8.45 Cr) Net Profit per Employee Rs 15.92 Lakh (Rs 11.81 Lakh) Net worth increased to Rs.2252.82 Cr as on 31.3.18 from Rs.1749.81 Cr as on 31.3.17 @ 28.75%. Reserves increased to Rs. 2158.74 Cr as on 31.3.18 from Rs.1655.72 Cr as on 31.3.17 @ 30.38%. Return on Assets improved to 2.25% as on 31.3.18 from 1.82%. Return on Equity improved to 22.33% as on 31.3.18 from 20.12%. Yield on advances marginally declined to 11.44% as on 31.3.18 from 11.90%. Cost to Income Ratio (Expenses Ratio) has considerably come down to 27.75% from 35.03%. NII was up by 30.10%. It increased to Rs 848.19 Crore in 2017-18 from Rs 651.93 Crore. NIM improved to 4.15% as on 31.3.18 from 3.86%. Capital Adequacy Ratio at 15.59% as on 31.3.18 up by 10.96% vis-à-vis 14.05% as on 31.3.2017. Other Income grew by 50.86% to reach a level of Rs 297.49 Crore from Rs 197.19 Cr. Credit to Agriculture at Rs.9666.29 Cr (Rs 8403.85 Cr) at a growth rate of 15.02% (Rs.1262.44 Cr) Disbursed Rs 7234.04 Crore to agriculture ( Rs 6687.77 Cr.) No. of Agriculture borrowers increased to 1027206 from previous FY's level of 975289. SHGs increased to 194776 from previous FY's number of 189884. SHG Loan o/s rose by 12.68 % to reach Rs 5584.02 crore ( Rs 4955.71 Cr) Implemented: UPI, IMPS, BHIM, Mobile Banking Application (Android, Windows, Apple stores), *99# Services for feature phones, Internet banking Facility, Deployment of POS machines to merchants, Missed call Banking, E-KYC account opening Installed Desktop ATMs at branch premises Enabled Aadhar & Mobile seeding facility at Bank Mitra points Awards: o ASSOCHAM: a) Winner in Best Agricultural Bank category and Runner up in best Social Bank category. b) 5th SMEs excellence award 2017 for "Micro Lending (Rural Sector)". o NABARD: Honourable Finance Minister Shri Arun Jaitly presented an Award for best performance in SHG Financing on the occasion of NABARD's 36th foundation day in New Delhi and Silver Jubilee of SHG-Banking Linkage. o GOI : Award from Government of India for Best performance in "SHG bank linkage" 2016-17 o PFRDA: Makers of Excellence Award for Best performance in Atal Pension Yojana ( APY ) o Ministry of Rural Development presented National Award for Best Performance in SHG Linkages 2017-18(NRLM National Rural Livelihood Mission) on 11.5.2017 o SKOCH - Our Bank has bagged the Skoch Order of Merit Award under Business Leadership category.
Note : (Figures in brackets pertain to previous FY)
11 Annual Report 2017-18 we are with you! Chairman’s Message I feel honoured to present the Annual Report for the Financial Year 2017-18, for the fourth consecutive time. Five important things that we achieved or sustained this year also have put our Bank where we are today. They are, profitability, efficiency parameters, strengthening and streamlining the systems and procedures, Business growth and IT Initiatives. For the second consecutive year, the Bank has exhibited its efficiency levels by posting a Net Profit of Rs.503.01 Crore up by 42.90% over previous year level of Rs.351.99 Crore. The Net Profit figures registered by our Bank over the last two years, have been the highest among all RRBs in the Country and these landmarks have never been touched by any RRB so far. The important factor contributing to the profitability is curtailing controllable expenditure. The expenses ratio has come down from Rs.35.03% to 27.75% during the year under report. This is the least among all RRBs sponsored by SBI. By conducting the income audit, income leakages have been plugged. Another important source of income is Treasury operations which yielded a profit of Rs.71 crore as against Rs.50 Crore last year. Cost of deposits has been reduced to 6.30% from 6.89%, by increasing the CASA deposits by 14.83% (Rs.780.44 Cr). Our Return on Assets surged to 2.25% as on 31.3.18 from 1.82% which means all assets that we created are yielding effectively. Return on Equity improved to 22.33% as on 31.3.18 from 20.12%. The Reserves increased by Rs 503.01 Crore at 30.38% from Rs 1655.72 Cr as on 31.03.17 to Rs 2158.74 Cr as on 31.03.18. Net worth of the Bank stood at Rs 2252.82 V. Narasi Reddy Chairman Crore with a growth of Rs 503.01 Crore (28.75%) over previous FY's figure of Rs 1749.81 Crore. This is the highest across all RRBs in the country. Capital Adequacy Ratio at 15.59 as on 31.3.18 up by 10.96% vis-à-vis 14.05% as on 31.3.2017. Our constant focus on ratios and efficiency parameters such as cost of deposits, cost of borrowings, yield on advances and investments, expenses ratio, asset quality and reduction of NPAs have culminated into where we stand today in terms of profitability. Every aspect in maintaining asset quality right from making day to day MIS to initiating legal action, has been in detail deliberated at all levels of administration and operations and appropriate measures initiated, which led to pruning the NPAs to the barest minimum. This has brought down the Gross NPAs to Rs 195.64 Crore (1.36%) as on 31.3.2018 from Rs 209.74 Crore (1.69%). With this continuous and consistent focus on the fundamentals and efficiency parameters, the margins have been maintained. The key to efficiency is to enhance the perception of Risk Management. During the year, the Bank introduced a tool of monitoring mechanism based on Risk Indicators on some of the key areas of Banking viz., Gross NPAs, KYC Compliance, Time barred debts, Missing documents, Loan mix, Inspecting rating, e-VVR Checking, BCGA Debit entries etc., to prompt corrective action . Depending on the periodicity and tolerance levels, each Key Area flashes alerts
12 Annual Report 2017-18 we are with you! indicating potential problems or warranting immediate flow of the process of administration. Everybody has action. This is made available to all levels of Managers been made to understand their obligations and their for understanding the gravity of the situation and act as rights. Key Responsibility Areas of workforce at all warranted. levels, have been prepared and circulated for effective During the year, the Bank's Board has reviewed all the functioning. The Bank has made efforts to drill the Policies and put in place for meticulous adherence. All concept of Role play into the minds of staff so that the these policies have been drafted duly incorporating the innocents are not dragged into trouble. guidelines / instructions / policy framework of GOI / RBI The Financial year has been intense in building the / NABARD / Sponsor Bank. The operations of the Bank leadership at all levels. We threw ourselves into the in all crucial areas are governed by these policies. process of building a strong system and conducting an The role of IT has been instrumental in our strategies and effective administration to achieve something that is not our Bank has put in place a number MIS reports. ordinary. Business of banking depends on effective monitoring and During the year, control of our RRB has shifted from monitoring depends on MIS. Apart from regular State Bank of India, Local Head Office, Hyderabad to business, there are number of areas such as data A&S Department of State Bank of India, Corporate purification, NPAs, KYC compliance, FIC operations, Centre, Mumbai. The composition of Directors from Mobile Banking activation, aadhar seeding, which Sponsor Bank on the Board also has changed require close follow up for achieving the desired levels. accordingly. I wholeheartedly thank the Managing This has been facilitated by effective MIS. This is one of Director Shri Dinesh Khara, the Chief General Manager the contributing factors for our success both in business Shri Ravi Nandan Sahay and Shri S. Ganesan, General and efficiency parameters. Manager (RRBs) for their timely guidance and support, For most RRBs, the toughest struggle is to come out of an without which the performance of our Bank would not image that their working style is archaic. We dedicated have been what it turned out to be. this year to connect our potential to the strengthening of I also thank each and every member of staff for their internal processes, administration, empowerment and support and cooperation all along this journey, taking on enlightening the concept of rights and responsibilities in the challenges and giving their best to the Organisation. day to day functioning and operations. We have been Last but not the least, my gratitude goes to around one going through a major transformation over a period of crore customers of our Bank for reposing confidence in some years in terms of work force. While younger our Bank and giving us the opportunity of serving them. generation come with a lot of dynamism, inexperience is a critical element that the Bank has been dealing with. The Bank has a task to pass through that critical mass Yours sincerely, stage of the workforce, assuming the leadership role and respecting and adhering to the laid down internal (V. Narasi Reddy) processes and systems and procedures. Chairman Systems and administration are important. If the system is followed in letter and spirit and if proper administration is ensured from top to bottom, results automatically follow. Sensitisation of officials at all levels has been taken up on a top priority basis as to respond to the calls received from top level administration as well as to place demand on the lower level administration for required support. Various workshops and meetings have been conducted to highlight the cadre at all level to understand the true meaning of empowerment. One has to exercise the powers vested with the position to ensure smooth
13 Annual Report 2017-18 we are with you! Key Performance Indicators Rs. in 000's Indicators 2015-16 2016-17 2017-18 A KEY PERFORMANCE INDICATORS 1 No. of Districts covered 8 22 22 2 No. of branches 751 768 768 a) Rural 531 494 494 b) Semi urban 156 181 181 c) Urban 49 52 52 d) Metropolitan 15 41 41 Ultra-Small Branches 488 488 488 3 Total Staff (excluding Sponsor Bank Staff) 2951 3012 3160 of which, Officers 1765 1821 1925 4 Deposits 102021153 128185762 143336293 Growth % 23.21 25.65 11.82 5 Borrowings outstanding 37337981 56208413 80412059 6 Gross Loans & Advances outstanding 106017675 123685318 143166957 Growth % 16.94 16.67 15.75 of 6 above, loans to Priority Sector 91912049 110580800 131227119 of 6 above, loans to Non Target Groups 15767667 13104500 11939837 of 6 above, loans to SC/ST 19308609 25973900 32116955 of 6 above, loans to SF/MF/AL 56544544 67230826 87126238 of 6 above, loans to Minorities 5516810 5187400 8420724 7 CD Ratio 103.92 96.49 99.88 8 Investments Outstanding 51960779 84864493 114273690 SLR Investments Outstanding 22886427 43432477 57638582 Non-SLR Investment Outstanding 29074352 41432016 56635108 B AVERAGE 9 Average Deposits 91112765 115515029 13347790 Growth % 23.30 26.78 15.55 10 Average Borrowings 41665867 45458048 5764651 Growth % 58.74 9.10 26.81 11 Average Gross Loans And Advances 94881573 110060777 129871031 Growth 18.33 16.00 18.00 12 Average Investments 49375579 58850454 74664481 Growth % 50.93 19.19 26.87 Average SLR investments 22503871 30843910 48841624 as % to average deposits 24.70 26.70 58.35 Average Non-SLR Investments 26871708 28006544 25822857 as % to Average deposits 29.49 24.24 -7.80 13 Average working funds 158988248 192895148 223950016
14 Annual Report 2017-18 we are with you!
Rs. in 000's Indicators 2015-16 2016-17 2017-18 C LOANS ISSUED DURING THE YEAR 14 Loans issued during the year 78679981 99600988 106919716 Growth % 25.21 26.59 7.34 of 14 above, loans to Priority Sector 71366527 83310200 92757898 of 14 above, loans to Non-target Groups 23077341 16290788 14161818 of 14 above, SC/ST 1926191 16076269 21244947 D PRODUCTIVITY (based on total Business) 15 Per Branch 277016 327957 373051 Per Staff 70498 84520 90666 E RECOVERY PERFORMANCE 16 TOTAL Demand 77776039 102622694 115545127 Recovery 64303445 87597449 100949732 Over dues 13472594 15025245 14595395 Recovery % 82.68 85.36 87.37 (June position) 17 FARM SECTOR Demand 37592669 40200604 49736937 Recovery 30211300 37943901 46449980 Over dues 7381369 2256703 3286957 Recovery % 80.36 94.39 93.39 (June position) 18 NON-FARM SECTOR Demand 40183370 62422090 65808190 Recovery 34092144 49653548 54499751 Over dues 6091226 12768542 11308439 Recovery % 84.84 79.54 82.82 (June position) F ASSETS CLASSIFICATION 19 (a) Standard 103497691 121587921 141210532 (b) Sub-Standard 776023 366930 262674 (c) Doubtful 1736300 1716141 1520235 (d) Loss 7661 14326 173516 Total 106017675 123685318 143166957 Standard Assets as % to Gross Loans & Advances out standings 97.62 98.31 98.64 G PROFITABILITY ANALYSIS 20 Interest paid on a) Deposits 6946094 7963182 8414939 b) Borrowings 2739088 3126205 3372854
15 Annual Report 2017-18 we are with you!
Rs. in 000's Indicators 2015-16 2016-17 2017-18
21 Salary (including leave encashment) 2357204 2013540 2170109 22 Other Operating Expenses 1010451 961124 1008736 23 Provisions made during the year (a) Against NPA's 303445 244916 594063 (b) Other Provisions -306919 44690 147808 (c) Amortization - - 31055 24 Interest received on (a) Loans & Advances 11047289 13099251 14850970 (b) Investments 3799661 4488826 5418718 (c) Others - 20649 - 25 Other Income 1614741 1971914 2974895 26 Loss / Profit 2234707 3519912 5030146 H Other information 27 Share Capital Deposit Received Nil- Nil- Nil- 28 DI & CGC - - - (a) Claims settled cumulative - - - (b) Claims received but pending adjustment - - - (c) Claims pending with Corporation - - - 29 Cumulative Provision - - (a) Against NPAs 1043312 1221643 1676144 (b) Against Standard Assets 292611 342625 406021 (c) Against Intangible Assets Frauds etc. 121188 115864 231331 30 Interest Derecognized (a) During the year Nil Nil Nil (b) Cumulative Nil Nil 31 Loans Written off during the year (a) No. of Accounts 35 3795 7448 (b) Amount 2600 59029 122662 32 Accumulated loss Nil Nil Nil 33 Reserves 13037325 16557237 21587384 Net NPAs 1476672 875754 280281 % Provisions to gross NPAs 41.40 58.25 85.67 % Gross NPAs to advances 2.38 1.69 1.36 % Net NPAs advances 1.41 0.72 0.20 CRAR 13.48 14.05 15.59
16 Annual Report 2017-18 we are with you!
Deposits (Rs. in Crores) Advances (Rs. in Crores)
2017-18 14334 2017-18 14317
2016-17 12819 2016-17 12369
2015-16 10202 2015-16 10602
2014-15 8280 2014-15 9066 2013-14 6791 2013-14 7895
2012-13 5869 2012-13 6590
2011-12 5153 2011-12 5533
Business (Rs. in Crores) Business Per Employee (Rs. in Crores)
2017-18 28650 2017-18 9.07
2016-17 25187 2016-17 8.45
2015-16 20804 2015-16 7.05
2014-15 17346 2014-15 6.10
2013-14 14687 2013-14 5.35
2012-13 12459 2012-13 5.03
2011-12 10686 2011-12 4.54
Net Profit (Rs. in Crores) Net Profit Per Employee (Rs. in Lakhs)
2017-18 503 2017-18 15.92
2016-17 352 2016-17 11.69
2015-16 223 2015-16 7.57
2014-15 202 2014-15 7.09
2013-14 180 2013-14 6.58
2012-13 159 2012-13 6.42
2011-12 120 2011-12 5.10
Net Profit Per Branch (Rs. in Lakhs) Business Per Branch (Rs. in Crores) 2017-18 65.50 2017-18 37.30
2016-17 45.83 2016-17 32.80
2015-16 29.76 2015-16 27.70
2014-15 27.69 2014-15 23.83
2013-14 25.64 2013-14 20.86
2012-13 24.92 2012-13 19.53
2011-12 20.91 2011-12 18.62 17 Annual Report 2017-18 we are with you! Awards
Chairman Shri V. Narasi Reddy receiving the Best Bank Award under MSME Banking Excellence Awards for our financial support to the MSME Sector during the year ended March 2017, from Shri Giriraj Singh, Honourable Minister of State for Micro, Small and Medium Enterprises, Government of India in New Delhi in a function organised by Chamber of Indian Micro Small & Medium Enterprises (CIMSME).
National Award for best performance in SHG Linkages 2017-18 ( National Rural Livelihood Mission) from Ministry of Rural Development, Government of India
18 Annual Report 2017-18 we are with you!
National award for Best Performance in SHG Bank linkages 2016- 5th SMEs excellence award 2017 for Micro Lending, 17 from Government of India on 22.11.2017- Shri S.L.N. Prasad, (Rural Sector) by ASSOCHAM on 14.12.2017- Shri T.V. Krishna AGM (CRRM) is seen receiving the award Reddy, GM-II, receiving Award from Dr. Udit Raj, Honourable MP
Our Bank has bagged the Skoch Order of Merit Award from Skoch Our General Manager -IV Shri K. Ravi Kiran receiving the Group. Our GM-IV Shri K. Ravi Kiran is seen receiving the award "Maker of Excellence Award" From PFRDA for our on 20.06.2017 performance in the APY Campaign.
19 Annual Report 2017-18 we are with you!
Walkathon was taken up by our staff as part of Mega Sports Meet to create awareness on digital banking, cashless transactions, financial literacy and Social Security Schemes like PMJJBY, PMSBY, APY, etc
20 Annual Report 2017-18 we are with you!
Board of Directors Report
2017-18
Lighting up the lives of rural people
21
Annual Report 2017-18 we are with you!
Board of Director's Report 2017-18 increase of Rs 227.80 Crore (43.58%) in operating profit We have pleasure in presenting the 13th Annual Report of during this year is impressive when compared with the Andhra Pradesh Grameena Vikas Bank (APGVB) together increase of Rs 181.47 Crore during 2016-17. This is due to with the Audited Statement of Accounts, Auditors' Report and increase in income in all areas i.e., interest on advances, the report on business and operations of the Bank for the investments, decrease in expenses ratio and decrease in cost of financial year ended on 31st March 2018. deposits from 6.89% to 6.30% during the year. Business Review
The Bank's business has registered a growth of Rs 3463.22 Net Profit (Rs. in Crores) Crore at 13.75% to reach Rs. 28650.33 as on 31st March 2018 2017-18 as against Rs 25187.11 Crore as on 31.3.17. 503 56% of the business growth of Rs 3463.22 Crore was 2016-17 352 contributed by Loans and Advances and the remaining 44% by 2015-16 223 deposits with an absolute growth of Rs 1948.17 Cr and Rs 1515.05 Cr respectively. The distribution of growth between 2014-15 202 deposits and advances in FY 2016-17 was in the ratio of 60% 2013-14 and 40%. 180 2012-13 159 (Rs. in Crores) Business 2011-12 120
2017-18 28650 Income and Expenditure (Rs in Crores) 2016-17 25187 Particulars 2016-17 2017-18 Growth %
2015-16 20804 Interest Income 1760.87 2026.97 15.11 Interest Expenditure 1108.94 1178.78 6.30 2014-15 17346 Non-Interest Income 197.19 297.49 50.86 2013-14 14687 Non-Interest Expenditure 297.46 317.88 6.86 2012-13 12459 Gross Profit/ Operating profit 551.66 827.8 50.06 2011-12 10686 Tax expenses 170.71 247.49 44.98 Deferred Tax Asset & Earlier year adjustments Profit Analysis (excess) 1.65 -4.55 -375.76 Provisions and The Bank registered a Net Profit of Rs. 503.01 Crore for the Contingencies 28.96 77.29 166.89 year 2017-18 as against Rs 351.99 Crore for the previous FY Prior Period depreciation 2016-17 at a growth rate of 42.90%. & rent 0 0 Increase in interest income by Rs.266.10 Cr (which includes Net Profit 351.99 503.01 42.90 increase in interest on investment by Rs.90.92 Cr), recovery of AUCA to the extent of Rs 6.01 Crore, profit from sale of Net Interest Income investments to the tune of Rs 71.41 Crore and reduction in NPAs by Rs 14.10 Crores, thus requiring less additional Total interest income earned during the year is Rs 2026.97 provisions have impacted the net profitability of the Bank. Crore where as total interest expenditure is at Rs 1178.78 Crore. The net interest income has increased by Rs. 196.26 The Operating profit of the Bank stood at Rs 750.50 Crore as on Crore to Rs 848.19 crore during the year vis-à-vis Rs 651.93 31.3.18 vis-à-vis previous FY's figure of Rs 522.70 Crore. The Crore in 2016-17 with a growth rate of 30.10%.
23 Annual Report 2017-18 we are with you!
Interest Expenditure (Rs. In Crores) Interest Income Interest Income Interest income increased from to Rs 1760.87 Crore to 1178.78 Rs. 2026.97 Crore during the FY with an absolute growth 2017-18 2026.97 of Rs 266.10 Crore (at 15.11%) The Bank has earned an interest income of Rs 1485.10 1108.94 Crore from loans and advances in current fiscal as against 2016-17 1760.87 Rs 1309.93 Crore in 2016-17 with an increase of Rs 175.17 Crore (@ 13.37%). 968.52 The interest income received from investments has 2015-16 increased by Rs 90.92 Crore at 20.16% to reach Rs 1484.7 541.87 Crore as against Rs 450.95 Crore in the previous FY. Cash payout of Rs 1800 Crore by State Bank of India 782.33 2014-15 on account of participation in IBPC, which was invested 1243.86 in STDR with them (SBI) has yielded good interest income. Interest Expenditure Interest income on Investments (Rs. In Crores) Interest paid on deposits has increased to Rs 841.49 Crore Interest income on Advances from the last FY's figure of Rs 796.32 Crore by Rs 45.17 541.87 Crore (5.67%). 2017-18 1485.1 The Bank has paid Rs 337.29 Crore towards interest on borrowings (refinance from NABARD, NHB and 450.95 2016-17 MUDRA) during the year as against Rs 312.62 Crore of 1309.93 FY 2016-17 with an increase of Rs 24.67 Crore. 379.97 2015-16 Interest paid on Borrowings 1104.73 Interest paid deposits (Rs. In Crores) 249.89 2014-15 337.29 993.98 2017-18 841.49 Provision for NPAs: 312.62 The Bank has made a provision of Rs. 59.41 Cr on NPAs during 2016-17 the year, taking the total Provisions available on Advances to 796.32 Rs. 208.21 Cr (including cumulative provision of Rs.40.60 Cr on Standard Assets). 273.91 2015-16 (Rs in Crore) 694.61 2016-17 2017-18 Provi Provi 203.55 Assets O/s O/s 2014-15 sion sion 578.77 Standard 12158.79 34.26 14121.05 40.60 Sub Standard 36.69 5.94 26.27 4.12 Operating expenditure Bad & Operating expenditure has increased by Rs 20.42 Crore Doubtful 171.61 114.79 152.03 146.14 (6.86%) to Rs 317.88 Crore in 2017-18 from Rs 297.47 Crore in previous FY 2016-17. Loss 1.43 1.43 17.35 17.35 Total 12368.53 156.43 14316.70 208.21
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Ratio Analysis Reserves (Rs. in Crores) 2016- 2017-18 S. Ratios 17 2017-18 2159 No. Amt/ % Change Ratio 2016-17 1656 1 Yield on advances 11.90 11.44 -3.87 2015-16 1304 2 Yield on investments 8.47 8.21 -3.07 3 Cost of deposits 6.89 6.30 -8.56 2014-15 1080 4 Cost of borrowings 6.88 5.85 -14.97 2013-14 879 5 Avg. cost of funds 5.75 5.26 -8.52 2012-13 6 Avg. return on funds 9.13 9.37 2.62 698 7 Financial Margin 3.38 4.11 21.60 2011-12 539 8 Cost of management 1.54 1.42 -7.79 9 Misc. Income as % to Working Funds 0.77 1.01 31.17 Net worth 10 Risk Cost 0.35 0.15 -57.14 Net worth of the Bank stood at Rs 2252.82 Crore with a growth 11 Net Margin 2.46 3.35 36.18 of Rs 503.01 Crore (28.75%) over previous FY's figure of Rs 12 Return on Assets 2.82 2.25 23.63 1749.81 Crore. 13 Gross Rate of return 1.56 1.91 22.44 The Capital Adequacy Ratio has further strengthened to reach 14 Expenses ratio 35.03 27.75 -20.78 15.59% at the end of the year vis-a-vis 14.05% as on 31.03.17 15 Gross NPAs 209.74 195.64 -6.72 well above the level of minimum 9% stipulated by Dr. K.C 16 Net NPAs 87.58 28.03 -67.99 Chakravarthi Committee. 17 % Provisions to gross NPAs 58.27 85.67 47.02 18 % Gross NPAs to advances 1.69 1.36 -19.53 19 % Net NPAs to advances 0.72 0.20 -72.22 20 CRAR 14.05 15.59 10.96 Balance Sheet Size The balance sheet size amounted to Rs.25665.22 crores (including IBPC gap of Rs 1800.00 Crore) with an increase of Rs.4618.07 Crores over March 2017 level. Capital & Reserves Authorized Capital: Pursuant to The Regional Rural Banks (Amendment Act) 2015,Raised the Authorized Capital of the Bank from 5,00,000 Equity Shares of Rs. 100/- each aggregating to Rs. 5 Crores to 200,00,00,000 Equity Shares of Rs. 10/- each aggregating to Rs. 2000 Crores. Paid up Capital: The Bank's paid up capital stood at Rs 94,08,50,000 (9,40,85,000 shares of Rs 10 each), subscribed by Government of India, State Government and State Bank of India in the ratio of 50:15:35. The Reserves increased by Rs 503.01 Crore at 30.38% from Rs 1655.72 Cr as on 31.03.17 to Rs 2158.74 Cr as JCB financed by our Ramchandrapur Branch (Mahabubnagar R.O) on 31.03.18. 25 Annual Report 2017-18 we are with you!
The following table gives the position of Tier-I, Tier-II Deposits (Rs. in Crores) Capital, Reserves and computation of CAR. (Rs in Crore) 2017-18 14334
Capital 2016-17 2017-18 2016-17 12819 1 Tier-I 2015-16 10202
a. Paid up Capital 94.08 94.08 2014-15 8280 b. Share Capital Deposit 0 0 2013-14 6791 c. Statutory Reserves & Surplus 332.48 433.08 2012-13 5869 d. Capital Reserves 0.01 0.01 2011-12 5153 e. Other Reserves 14.31 14.31 Deposit Mix f. Spl.Reserve u/s 36(1)(Viii) of income Tax act 1961 3.85 10.38 CASA deposits grew by Rs 780.43 Crore at 14.83% to reach Rs g. Surplus in P&L 1305.07 1700.95 6041.94 Crore as against Rs 5261.51 Cr as on 31.3.17. Term Deposits grew by Rs 734.62 Crore to reach a level of Rs Total reserves (b+c+d+e+ f+g) 1655.72 2158.74 8291.69 Crore at 9.72% as against Rs 7557.07 Crore. Total Tier-I Capital 1749.80 2252.82 2 Tier-II a. Undisclosed Reserves The share of CASA has increased from 41.05% to (31.03.2017) to 42.15% as on 31.03.2018 b. Revaluation Reserves (Rs. in Crores) c. General Provisions & Deposit mix 2016-17 2017-18 Reserves 45.85 52.08 Current A/c 126.87 121.80 d. Investment fluctuations Reserves / Fund Growth 67.53 -5.07 Total Tier-II Capital 45.85 52.08 Growth %age 113.80 -4.00 Grand Total (Tier I + Tier II) 1795.65 2304.90 Savings Bank A/c 5134.63 5920.14 3. a. Adjusted value of funded Growth 1460.20 781.51 risk assets i.e., balance Growth %age 39.74 15.30 sheet items 12754.79 14764.78 Total CASA 5261.51 6041.94 b. Adjusted value of non- funded risk assets i.e., Growth 1527.72 780.43 balance sheet items 21.98 21.62 Growth %age 40.9 14.83 c. a+b 12776.77 14786.40 Term Deposits 7557.07 8291.69 d. Percentage of Capital Growth 1088.73 734.62 (Tier-I + Tier II) to Risk Growth %age 16.83 9.72 Weighted Assets 14.05 15.59 Total deposits 12818.58 14333.63 Deposits Growth 2616.47 1515.05 Deposits registered a growth of Rs 1515.05 Crore over March Growth %age 25.65 11.82 2017 level at a growth rate of 11.82%. Total deposits as on 31.3.2018 stands at Rs 14333.63 Crore as against Rs 12818.58 Crore as on 31.3.2017.
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Borrowings in GOI/State Govt Securities only. The purchase and sale of The aggregate borrowings of the Bank as on 31st March 2018 Govt Securities are undertaken by the Portfolio Management stood at Rs. 8041.21 Crore whereas it was Rs. 5620.84 Crore Services Department of State Bank of India. as on 31st March 2017. Non SLR Investments (Rs. in Crores) Non-SLR investments are invested in TDRs of Banks. The S.No Institution 2017-18 2016-17 Variance Bank has been monitoring and following up for prompt receipt 1 NABARD 5299.46 3684.71 1614.75 of interest due from Govt Securities /Bonds. There was no 2 SBI 2604.41 1894.61 709.80 instance of income leakage from Non-SLR investments 3 NHB 97.33 41.52 55.81 portfolio. 4 MUDRA 40.00 0 40.00 CRR and SLR Total 8041.21 5620.84 2420.36 The Bank has complied with the regulatory requirement of The Bank has availed refinance against Crop loan maintenance of adequate balances towards CRR and SLR. disbursements from NABARD @ 20%. Refinance against There is a well laid down system of assessing the CRR and SHG disbursements and Rural Housing was provided by SLR requirements taking into account the NDTL. There was NABARD and NHB respectively @ 100%. no default in maintenance of adequate balances during the year. The Bank has kept Rs 567.49 crore in CRR and Rs Assets 5952.32 crores in SLR as on 31.03.2018. Investments Credit Portfolio Total investments portfolio– both SLR and Non-SLR - of the Bank has increased to Rs 11427.37 Crore as on 31.3.18 from previous year's The credit portfolio of the Bank rose by 15.75 % to Rs. level of Rs 8486.45 Crore by Rs 2940.92Crore @34.65%. 14316.69 Crore during the financial year ended 31.03.2018 from the previous year level of Rs 12368.53 Crore, thus Investments 2016-17 2017-18 (Rs. in Crores) showing an absolute growth of Rs. 1948.16 Crore as against SLR 4343.25 5763.86 the target of Rs 1851.47 Crore. Growth 2054.61 1420.61 Growth %age 89.77 32.71 Non SLR 4143.20 5663.51 Growth 1235.76 1520.31 Growth %age 42.50 36.69 Total Investments 8486.45 11427.37 Growth 3290.37 2940.92 Growth %age 63.32 34.65
* IBPC – an amount of Rs 1800 Crore received from State Bank of India, on account of gap in IBPC, is kept as TDR in Banks which has to be returned on the expiry date of IBPC i.e., 23.09.18.
Investment Policy: The Investment Policy of the Bank was formulated in 2006 and the same was reviewed/revised and approved by the Board from time to time, conforming to the RBI guidelines. SLR Investments
In terms of Section 24 of the BR Act 1949, the Bank has Creating a New Value Curve - Marketing of our Bank's maintained investments in the avenues laid down in the Policy, products to fulfill the SLR requirements. All SLR investments are made
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Credit to Agriculture scheme has been in existence and continued by both the states Total credit to agriculture and allied activities including of Telangana and A.P. We have submitted our claim of agriculture-portion of SHG lending, stood at Rs 9666.29 Crore Rs.60,74,03,328/- and Rs.16,33,31,563/- to the State as on 31.3.2018 as against Rs 8403.85 Crore with a growth of Governments of Telangana and Andhra Pradesh respectively Rs 1262.44 Crore (@ 15.02 %). Total number of Bank's during the year 2017-18. borrowers in Agriculture sector has increased to 1027206 vis- Interest Subvention a-vis 975289 in FY 2016-17. More than 75 % of the credit to As per Government of India guidelines, Bank is implementing SHG finance is also towards agricultural operations. 7% interest rate to all the crop loan borrowers up to Rs.3.00 The Bank has disbursed Rs. 7234.04 Crore to agriculture lakhs and accordingly claimed an amount of Rs 65,50,31,683/- during the year as against the previous year's disbursal of Rs towards 2% interest subvention from the GOI during the year 6687.77 Crore. 2017-18. As per the directives of Government of India, we had Total credit to agriculture and allied activities constitutes 66.67 passed on the benefit relating to interest subvention incentive % of the total credit portfolio as on 31.3.2018 vis-à-vis 67.95 % to the extent of Rs 58,56,85,000/- to the prompt repayers and as at the end of previous FY. claim submitted accordingly Crop loans under revised Kisan Credit Card System Crop Loan Waiver Scheme in Telangana State As per the directions of Government of India and NABARD, Our Bank has implemented Crop Loan Waiver Scheme we have implemented revised Kisan Credit Card System for announced by the Government of Telangana. Under the crop loan borrowers from Kharif 2012. According to the Scheme, all crop loans and crop loans against gold ornaments guidelines of revised KCC, we have introduced a new product outstanding as on 31.3.2014 have been covered to the extent of KCC-cum-SB account in the CBS for a period of 5 years. As Rs 1 Lakh (including interest upto 31.8.14) per farmer. In case per this system, the farmers can remit their surplus funds in the borrower took loan from multiple bank branches, the their KCC account and can draw according to their requirement outstanding loan amounts are clubbed for the purpose of and they need not maintain separate Savings Bank account. waiver. There is a provision for giving interest as applicable for Accordingly, we have submitted the data of all eligible loans Savings Bank account for the credit balances in the KCC amounting to Rs 2401.42 Crores and Government of account. Further, loan limits will be fixed for 5 years and Telangana released fourth phase of 25% of the total eligible documents will be obtained for the terminal limit. Year-wise amount for credit to respective accounts. limits will be fixed basing on present Scales of Finance and Crop Loan Waiver Scheme in Andhra Pradesh State keeping in view the future cost of investment. Our Bank has implemented Crop Loan Waiver Scheme We have issued 850638 KCCs as on 31.3.2018 with an announced by the Government of Andhra Pradesh. Under the outstanding credit of Rs 5509.40 Crore as against previous FY Scheme, all crop loans, crop loans against gold ornaments and level of 808713 KCCs for Rs 4727.55 crores. the crop loans converted to MTL, which were outstanding as During the year 2017-18, we have disbursed an amount of Rs on 31.12.2013 including interest are eligible for waiver. The 4513.97 Crore to 650780 KCC card holders as against Rs maximum ceiling for waiver of the loans was Rs 1.50 Lakhs. 3990.71 Crores to 704471 card holders during the year 2016- Entire family is taken as a unit and loans taken from multiple 17. Instructions were issued to all the branches to cover all Bank branches are clubbed for arriving at the maximum KCC holders up to the age of 70 under Personal Accident waiver. Insurance Scheme(PAIS) during the three year card holding Accordingly, we have received an amount of Rs. 417.26 period, with risk coverage of Rs.50,000/- The annual premium crores, out of which 417.07 crores was utilized and credited to of Rs.20/- was jointly borne by the Bank Rs.13/- and the respective loan accounts. We have refunded an amount of Rs. borrower Rs.7/- 0.19 crores as ineligible amount. Crop Loans - Vaddileni Runalu / Pavala Vaddi Conducting of Grama Sabhas Government of unified Andhra Pradesh had implemented All branches have conducted Grama Sabhas for the customers, “Vaddileni Runalu/ Pavala vaddi” scheme i.e., reimbursement mainly for the purpose of educating the farmers in renewing of interest subvention and incentive subvention for prompt the crop loans to avail the benefit of Debt Waiver Schemes payers of crop loan borrowers from Rabi 2011-12. Under the announced by the State Governments. To ensure maximum VLR Scheme, farmers need not pay the interest portion. The
28 Annual Report 2017-18 we are with you! coverage of farmers, Grama Sabhas were conducted in the Self Help Groups evenings and mornings and sensitized farmers to renew their Our Bank has financed 194776 Self Help Groups (Covering crop loans to be eligible for Debt waiver benefits. Apart from about 26.50 Lakh rural women) with an outstanding portfolio operating staff at Branches, functionaries from ROs, Head of Rs 5584.02 Crore as on 31.3.2018 as against previous year's Office right from office Assistant to Chairman have level of 189884 Groups with outstanding credit of Rs 4955.71 participated in the Grama Sabhas, which yielded very good Cr. The total loans outstanding under SHG segment has results in successfully implementing the Debt Waiver increased by Rs 628.31 Crore at a growth rate of 12.68% programmes. during the year 2017-18 against previous year growth of Rs Tenant Farmers – Loan Eligibility Card Holders 971.02 Crore (@ 24.37%). We have financed 5697 tenant farmers under the Loan The Bank has disbursed Rs 3640.62 Crore to 147737 Groups Eligibility Cards Scheme with a credit outstanding of Rs.11.42 during the year as against Rs 3655.37 Crore disbursed to Crore during the year 2017-18. AP Land Licensed Cultivators 126847 SHGs during the previous year. Ordinance aims at ensuring loan and other benefits to tenant The Bank has highest number of Self Help Groups linked to farmers, by means of Loan Eligibility Cards. Bank and loan amount outstanding, among all RRBs in the Joint Liability Groups (JLGs) country. JLGs are expected to overcome the problem of tenant farmers As per the directions of Government of India and NABARD, we have been implementing Cash Credit System for SHG getting deprived of institutional credit. loans with effect from January 2012. Accordingly, we have The Bank has financed an amount of Rs 96.81 Crores to the arranged for fixing limits for a period of 5 years basing on their JLGs as on 31.03.2018, taking the total JLGs financed to 7228. present corpus and proposed thrift. The loan documents will During the year 3348 groups were financed amounting Rs. be obtained for the limit of terminal year duly preparing the 38.13 crores. appraisal for 5 years and year-wise limits will be fixed basing NABARD has sanctioned a grant assistance of Rs.16.36 lakhs for on present corpus and proposed thrift (subject to a maximum of formation and linkage of 818 JLGs during the year in both states. Rs.7.50 lakhs). The limit will be fixed as 8 times of corpus We have claimed an interest subvention @ 5.5% Rs (1:8) for the current year and for the subsequent years, the limit 118,08,44,179/- and 3% interest Incentive subvention Rs will be 1:8 of present corpus PLUS expected thrift. 56,57,50,254/- during the year 2017-18 under NRLM.
Mudra Promotion campaign launched by GOI – Our Bank set up a stall to promote Mudra finance – Financing SHGs of Janagaon Dist to a tune of Rs.1.45 Crore – cheque handed over by Smt. Pausumi Basu, IAS, CEO, Telangana SERP. Sanction of loans under MUDRA – Chairman Shri V. Narasi Reddy is seen interacting with young MUDRA borrowers.
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No of SHGs (Rs. in Crores) National Rural Livelihood Mission (NRLM) - Aajeevika – 2017-18 194776 Interest Subvention Scheme Our Bank has implemented NRLM Scheme as per the 2016-17 189884 guidelines issued by NABARD vide their letter No 2015-16 184440 249/MCID-LS/2013-14 dated 26.11.2013. The government restructured Swarnajayanthi Grama 2014-15 176281 Swarozgar Yojana - SGSY (which was in existence since FY 2013-14 163388 2010-11) into National Rural Livelihoods Mission (NRLM) to provide greater focus and momentum for poverty reduction. 2012-13 160186 The Mission aims at creating efficient and effective institutional platforms of the rural poor enabling them to 2011-12 163308 increase household income through sustainable livelihood enhancements and improved access to financial services. Amt. o/s (Rs. In Crores) Under the Scheme, all Women SHGs promoted by NRLM or 2017-18 5584.02 other Central or State Government Line Departments or NABARD or any NGOs, which are linked with our Bank, are 2016-17 4955.71 eligible to avail the benefits of the Scheme. As per the Scheme, GOI identified 250 backward districts all over the country 2015-16 3985 under Category-I, of which we have six districts in our notified 2014-15 3403.31 area namely Warangal, Khammam, Mahabubnagar (erstwhile districts in Telangana state) and Srikakulam, Vizianagaram, 2013-14 2513 Visakhapatnam in Andhra Pradesh. 2012-13 2015.98 All such Women SHGs in the six districts have been extended credit at 7% rate of interest upto Rs 3 Lakhs and Government 2011-12 1665.19 would subvent to the extent of difference between 7% and actual rate of interest (12.5% ) subject to a maximum of 5.5%. Apart from this, prompt paying SHGs will be extended an SHGs - Vaddileni Runalu additional 3% subvention. SERP (Society for Elimination of Rural Poverty) would credit the remaining 4% interest for Both the State Governments i.e., Telangana and A.P have been prompt repayers reducing 'ZERO” interest burden to the implementing “Vaddileni Runalu” scheme i.e. reimbursement groups. of interest for prompt payers of Self Help Groups upto loan limit of Rs.5.00 lakhs. The Bank would provide particulars of We have two districts among the Category-II districts (other transactions in SHG accounts relating to all the branches to the than the above 250 districts) under NRLM namely Nalgonda SERP and basing on that, the SERP, Hyderabad, arrives at the and Medak. Funding for this subvention will be provided by list of SHG accounts eligible for VLR scheme and accordingly the SRLM (State Rural Livelihood Mission). release the interest amount which is credited to the respective SRLM and SERP will provide each 7% interest as subvention SHG accounts directly. for prompt repayers through e-transfer to the SHGs accounts As per the directions of Government of India, SHG Cash Credit under the Scheme for Category-II districts. loans are also to be treated as normal Cash Credit Loans for the National Urban Livelihood Mission (NULM) purpose of classification of asset etc. But, as per the guidelines Government of India restructured Swarna Jayanti Shahari of VLR scheme the SHGs have to repay a minimum of 3% of Rozgar Yojana (SJSRY) as National Urban Livelihood drawing power every month to become eligible for Mission (NULM). The SEP (Self Employment programme) reimbursement of interest. We have, therefore, insisted the component of NULM focus on providing financial assistance SHGs for repayment of 3% of drawing power towards EMI, through a provision of interest subsidy on loans to support though it is sufficient if they pay only the interest and other establishment of Individual and Group Enterprises and SHGs charges if any, every month. of urban poor. Under the Scheme, (a) Interest subsidy, over and above 7% of ROI is available on a Bank loan of Rs 2 Lakh
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to individual enterprises and Rs 10 Lakh for Group Enterprises. Inter Bank Participation Certificates The difference between 7% p.a. and the prevailing ROI will be In accordance with the RBI guidelines, the bank has entered provided to Banks under NULM; (b) SHGs in urban areas can into Risk sharing participation Contract with State Bank of avail Bank loan at 7% ROI. The difference between 7% p.a. India under Inter Bank Participation Certificate (IBPC) and and the prevailing ROI will be provided to Banks under issued priority sector advances to the extent of Rs.1320.00 NULM. Further,an additional 3% interest subvention will be Crore on 13.02.2017 for a period of 180 days as cash pay-out provided to all women SHGs for prompt repayment as per and maturity period expired on 16.08.2017. During this repayment schedule by GOI. Apart from this, as per State financial year the Bank issued priority sector advances to the Government of Andhra Pradesh, the balance portion of interest extent of Rs.1663.00 Crore on 14.09.2017 for the period of 180 will also be released under VLR Scheme as per the eligibility. days as cash pay-out and maturity period expired on Priority Sector Lending 13.03.2018. Further, again during the year the bank issued In terms of RBI Circular No: FIDD. CO. Plan. BC. priority sector advances to the extent of Rs.1800,00,00 No.14/04.09.01/2015-16 dated December 3, 2015, w.e.f (thousands) on 27.03.2018 for the period of 180 days as cash 01.01.2016 75 per cent of outstanding advances should be pay-out. towards Priority Sector, which constitutes loans extended to (a) Priority Sector Lending Certificates Agriculture (Farm credit , Agriculture infrastructure, Ancillary As per RBI master circular No. FIDD.CO. Plan. BC activities ) (b) Micro, Small and Medium Enterprises 23/04.09.01 /2015-16 dated 07.04.2016 of PSLC, trading on e- (Manufacturing and Service Sector, KVI and OD to PMJDY) Kuber portal is an ongoing process. All traded PSLCs will (c) Education (d) Housing (e) Social Infrastructure (f) expire by March 31st and will not be valid beyond the Renewable Energy (g) Weaker Sections and (h) Others reporting date (March 31st), irrespective of the date it was first (SHG/JLG, distressed persons, Loans to State Sponsored sold. Organizations for Scheduled Castes/ Scheduled Tribes). According to the SBI instructions on trading in "Priority Sector RRBs will have a target of 75 per cent of their outstanding Lending Certificates" through CBS e-Kuber portal, we have advances for priority sector lending and sub-sector targets as started trading on e Kuber portal from 28.12.2017. Initially we indicated in table below. have sold surplus of Small & Marginal farmers Agri lendings under Priority Sector to the tune of Rs. 50 crores as on Categories Targets 22.12.2017. Total Priority Sector 75% of total outstanding Government Sponsored Schemes Agriculture 18% of total outstanding The Bank has participated in Govt Sponsored Schemes Small and Marginal Farmers 8% of total outstanding actively during the year and as on 31.3.2018, the total finance Micro Enterprises 7.5% of total outstanding extended under various Schemes and loan outstandings in Weaker Sections 15% of total outstanding various schemes are as under. The Bank's priority sector lending constitutes 91.66% of total advances. In absolute terms, total priority sector lending stood at Rs 13122.71 Crore as on 31.03.2018 as against Rs 11058.08 Crore as on 31.03.2017. There is a growth of Rs 2064.63 Crore @ 18.67 The Weaker Sections Loans stood at Rs 9402.58 Crore, which forms 65.67 % of total lending. (Rupees in Crore) 2016-17 2017-18 S. No.of No.of No O/s A/cs O/s A/cs 1. Weaker Sections 972702 8895.42 988016 9402.58 2. Women borrowers 480029 4488.13 489568 4567.63 3. Minorities 48992 518.74 63571 609.72 4. Scs/STs 222626 2597.39 257984 3037.49 Auto trolley financed by our Bibinagar Branch (Nalgonda R.O)
31 Annual Report 2017-18 we are with you!
Poultry farm financed by our Tadur Branch (Mahaboobnagar R.O) - Ms. Sangeeta Kartha, AGM, NABARD is seen visiting the unit
Rice Mill financed by our Balijapeta Branch (Parvathipuram RO) - Our Regional Manager, Shri D. Rama Rao inaugurating the unit
32 Annual Report 2017-18 we are with you!
Position of Government Sponsored Schemes as on 31.03.2018. Participation in State Credit Plans The Bank's participation in State Credit Plans is as under: (Rs in Lakhs) 2016-17 2017-18 Scheme Target Achievement S. Target Achiev Target Achiev No No. of Amt. No. of ement ement Units Units Amt. 1. Crop Loans 3200.00 3990.71 3800.00 4513.97 SCAP 5645 6444.45 5009 5717.98 2. Total Agr & allied activities 200.00 212.36 220.00 214.94 BCAP 3594 2769.15 3269 2518.60 3. NFS 552.00 561.12 580.00 678.02 STAP 1548 675.00 1291 559.62 4. OPS 2289.00 3566.83 2375.00 3437.62 Minorities 817 510.09 748 478.25 5. Total Priority Sector 6241.00 8331.02 6975.00 8844.55 Weavers 651 315.95 514 233.87 % of achievement 133.49 126.80 Pasukranthi / PPK 0 0.00 0 0 Retail Lending MEPMA 374 944.00 234 386.00 During the year, we have focused more on increasing the share PHC 489 366.22 381 280.92 of retail lending to Housing, Education Loans, Mortgage Others 2122 2195.00 1961 1707.62 Loans, Personal Gold Loans, MSME etc. Capacity building of Total 15240 14219.86 13407 11882.86 the operating staff has been given top priority by conducting Achievement % 87.97 83.57 training programmes to diversify the credit portfolio to increase our profitability. The performance is as under. Position of Government Sponsored Schemes as on 31.03.2018. (Rs in Lakhs) (Rupees in Crore) Scheme Outstanding Disbursement from O/s Mar 2016-17 O/s Mar 2017-18 S. as on 31.3.18 1.4.16 to 31.3.18 Segments No.of No.of No Amt Amt No. of Amt. No. of Amt. A/cs A/cs Units Units 1 Housing Loans 8234 773.14 10634 1185.25 SGSY 1588 1692.47 0 0.00 2 Mortgage Loans 2567 117.76 3072 167.46 RYS 854 1785.00 0 0.00 3 Education Loans 3162 82.66 2499 72.56 SCAP 29152 9199.46 5009 5717.98 4 Demand Loans 18368 181.78 16711 202.52 BCAP 24026 7026.86 3269 2518.60 5 NFS - Term Loan STAP 25992 5513.97 1291 559.62 /MSME 98167 932.59 106782 1134.28 Minorities 5225 4710.75 748 478.25 6 Personal Loans 13259 290.01 10282 274.23 Weavers 1895 1547.54 514 233.87 7 Personal Gold VAMBAY/ Loans 115201 538.84 105065 503.91 INDIRAMMA 1592 955.22 0 0.00 Total 258958 2916.78 255045 3540.21 KVIC 19 98.05 0 0.00 Pasukranthi / PPK 6670 5530.02 0 0.00 In the branches covered under RASMECCC, Vishakapatnam retail segment has increased by Rs 33.64 Crore over previous PMEGP 255 149.26 0 0.00 year, of which Housing loan segment has accounted for Rs MEPMA 1363 412.08 234 386.00 24.85 Crore. Total outstandings increased to Rs 53.03 Crore PHC 764 428.67 381 280.92 from Rs 19.39 crore at 173.44 %. Others 256 224.86 1961 1707.62 Total 99651 39274.21 13407 11882.86
33 Annual Report 2017-18 we are with you!
Cashew unit financed by our Kasibugga Branch (Srikakulam RO)
Kalyana Mandapam financed by our Arikathota Branch Housing financed by our Ashoknagar Branch (Ashoknagar RO) (Parvathipuram RO)
34 Annual Report 2017-18 we are with you!
CSIS Scheme other banks / FIs as a result of which the potential fraud / Government of India has introduced CSIS Scheme (Central multiple financing against the same property can be prevented. Scheme for Interest Subsidy) for providing relief to students Credit Guarantee Fund Trust For Micro & Small who were sanctioned / disbursed from 01.04.2009. Education Enterprises (CGTMSE) loans availed by the students from economically weaker The objective of the Scheme is to make bank credit available to sections whose annual gross family income is upto Rs 4.50 the first generation entrepreneurs without the hassles of Lakhs, are eligible under the scheme. Our bank has been collaterals / third party guarantees to realize their dream of claiming Interest subsidies under this scheme for the eligible setting up a unit of their own Micro and Small Enterprise students since 2009-10 to 2016-17 on the CSIS portal of Canara (MSE). The Credit Guarantee Scheme (CGS) seeks to Bank (Nodal Agency) every year. All the claims for all years reassure the lender that, in the event of a MSE unit, which has been settled to our bank and partially settled for FY-2016- availed collateral free credit facilities, fails to discharge its 17. liabilities to the lender, the Guarantee Trust would make good For the FY 2015-16, we have claimed an amount of Rs the loss incurred by the lender. 96,88,739/- in respect of 353 education loan accounts and ISB Sector loans excluding retail trade advances and including received total amount from Government of India. Small Road and Transport loans are eligible for guarantee For the FY-2016-17, we have claimed an amount of cover of CGTMSE up to a limit of Rs.10.00 lakhs, as per the Rs.61,25,873/- in respect of 274 education loan accounts and directions of Reserve Bank of India received total amount for SC & ST students amounting to The details of the loan accounts covered under CGTMSE Rs.3,09,498/- and received 14.59% for General and OBC scheme so far as under. students Rs.8,48,698/-, Remaining subsidy for General (Rs in lakhs) students yet to be released by GoI. During the year 2017-18 Cumulative ACSISOBCEBC: Further GoI has introduced Dr.Ambedkar's No.of A/cs Amount No.of A/cs Amount Central Scheme of Interest Subsidy for Other Backward Caste 5023 3550.07 11476 7350.60 (OBC) and Economically Backward Caste (EBC) for providing relief to students Studying in abroad, who were Credit Information Companies sanctioned / disbursed from 01.04.2017. Education loans Our Bank has been a member of CIBIL (Credit Information availed by the students from Economically Backward Caste Bureau (India) Limited). CIBIL is the first Credit Information (EBC) whose annual gross family income is upto Rs 2.50 Company licensed by the RBI and governed by the Credit Lakhs, and for Other Backward Caste (OBC) income is upto Information Companies (Regulation) Act of 2005. CIBIL Rs.8.00 Lakhs are eligible under the scheme. Our Bank has collects and maintains records of individuals' and non- been claiming Interest subsidies under this scheme for the individuals' (commercial entities) payments pertaining to eligible students on the ACSISOBCEBC portal of Canara Bank loans and credit cards from Banks and other lenders on a (Nodal Agency) for quarterly intervals , during the year 2017- monthly basis. Using this information a Credit Information 18, we have claimed Rs.47,77,961/- for 162 (for 4 quarters) Report (CIR) and Credit Score is developed, enabling lenders accounts and received claim of Rs.31,88,719/- (upto to evaluate and approve loan applications. December quarter) for both OBC and EBC yet to receive for Our Bank has been uploading the data regularly and all our March 2018 quarter. Regional Offices and Branches are accessing the credit history Central Registry of Securitisation Asset Reconstruction of the loan applicants in their credit decisions. and Security Interest of India (CERSAI) Three other CICs, viz., Equifax Credit Information Services Our Bank had registered with CERSAI in terms of RBI Private Limited, Experian Credit Information Company of guidelines and complied with the instructions. India Private Limited and CRIF High Mark Credit Information Equitable/Registered mortgages and Hypothecation in respect Services Private Limited have been granted Certificate of of all our loans, which are covered under Securitization and Registration by RBI. Reconstruction of Financial Assets and Enforcement of Reserve Bank of India vide its letter No. DBR No. Security Interest Act, 2002 (SARFAESI Act) as on 31.03.2017 CID.BC.60/20.16.056/2014-15 dated 15.01.2015 has advised have been registered with CERSAI. us that all Credit Institutions have a mandate to become With this, the details of the security interest created in favour of members of all CICs. Accordingly we have become members our bank is available on a public domain for search by citizens / of the above three CICs also.
35 Annual Report 2017-18 we are with you!
Borewell Rig financed by our Lakshmidevipalli Branch (Bhadrachalam RO) Cloth Shop financed by our Burgampad Branch (Bhadrachalam RO)
Inauguration of Asset Management Hub in Hanamkonda
Rythu Avagahana Sadassu organized by our Warangal RO. Grama Sabha organized by our Sadasivapet Branch (Sangareddy Our Chairman is seen interacting with farmers along with RO) - Shri Mallempati Ravi, AGM andRM, is seen addressing the Shri D. Viswa Prasad, AGM and RM Warangal. customers with Chairman present in the meeting
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Asset Quality – Management of Non Performing Assets The Lokadalats shall have jurisdiction to determine and to The Non-Performing Assets have decreased by Rs. 14.10 arrive at a compromise or settlement between the parties to Crores from Rs. 209.74 Crores as on 31st March 2017 to Rs. a dispute in respect of any case pending before any court or 195.64 Crores as on 31st March 2018. Gross NPAs as a any matter which is falling within the jurisdiction of any percentage to total advances has come down from 1.69% as on court and any matter not brought before such court pre- 31.3.2017 to 1.36% as on 31.3.2018. Net NPAs (as a %age to litigation. Net advances) has come down from 0.72% to 0.20%. In Every award of Lokadalat shall be final and deemed to be a absolute terms, Net NPAs was reduced from Rs 87.58 Crore to decree of Civil Court binding on all the parties to the Rs.28.42 Crore. The NPAs have come down in all segments dispute. Such civil court having jurisdiction shall execute except KCC and recalled debts. the order as if it were a decree made by that court. SARFAESI Act and Suit filing No appeal shall lie to any court against the award of the Notices under SARFAESI Act were issued immediately after Lokadalat not even under Article 226 of the Constitution the account becoming NPA. This was monitored by Head because it is a judgement by consent. Office at monthly intervals. Our actions in this regard have In order to have uniformity, we have advised the percentage yielded good results. We have taken demonstrative actions of remission to be allowed while referring the cases to particularly under SARFAESI. One desk officer each has been Lokadalat Accordingly our branches have participated posted to all Regions exclusively for the purpose of monitoring exceedingly well and many branches have participated in NPAs who will be responsible for initiating action under Lokadalats. During the year, 235 cases for an amount of SARFAESI, Suit Filed, vehicle seizure etc., and also closure of Rs.5.62 Crores were referred to Lokadalats of which 235 suit filed cases, AUCA recovery etc. Focus was given for cases were settled for an amount of Rs.5.62 Crores. Of recovery of Recalled debts/ Suit filed accounts. Meetings with which an amount of Rs.3.82 Crores was recovered. Advocates were conducted in regions for expediting disposal of suits. Compromise settlements Bank has recovered huge amounts of NPAs during the year Performance under SARFAESI is as under: 2017-18 under compromise settlement which are overdue for A/cs Amt several years and where sufficient provisions are available. Demand Notices issued 101 856.85 Possession Notices issued 83 761.29 (Rs. in Lakhs) Possession taken 13 169.45 Compromise 2016-17 2017-18 Auctioned 7 125.35 No of A/Cs 2656 3006 Regularized 76 763.22 Amount in Lakhs 3536.20 2255.11 Keeping the high NPA level under TL-ISB an exclusive OTS Performance under Suit-filed cases is as under: (Rs. in Lakhs) scheme was announced during the year christened as Runa Cases Amt Parishkar, 1745 A/Cs were closed under the scheme Suit filed 1857 4210.11 amounting to Rs. 510.55 lakhs. A special OTS scheme for Decreed 1068 1997.72 resolving NPAs under SHG was also announced through EP Filed 478 1106.85 which 1005 proposals amounting to Rs.693.32 lakhs were Recovery after filing suits 576 801.56 closed. The following strategies were adopted to reduce / contain the Lokadalat NPAs: Lokadalat inter-alia, is one of the modes of Alternative 1. One desk officer each has been posted to all regions Dispute Resolution, of late, gaining popularity as the award of the Lokadalat shall be deemed to be a decree of Civil exclusively for the purpose of monitoring NPAs who will Court. The significant feature of the Lokadalat is that legal be responsible for initiating action under SARFAESI, Suit experts holding Lokadalat bench guide the parties in Filed, vehicle seizure etc., and also closure of suit filed arriving at a compromise or settlement in a friendly and cases, AUCA recovery etc. harmonious atmosphere.
37 Annual Report 2017-18 we are with you!
2. Chief Managers at Head Office (HODs) have been Internal Control System – Inspection & Audit allocated one Region each to monitor NPA position. They All activities of the Bank are subjected to internal audit camped at those regions continuously and visited function, which comprises four different types of audits branches, meeting NPA borrowers. namely (a) Risk Focused Internal Audit (RFIA) (b) Snap Audit 3. More than Rs.20.00 Lakhs outstanding NPA accounts are (c) Concurrent Audit and (d) Bank Mitra Audit. being monitored by Chairman personally. Risk Focused Internal Audit (RFIA) 4. Top 100 NPA branches were monitored personally by The Risk Focused Internal Audit Report System has been Chairman, four General Managers for reduction of NPA. implemented in the Bank from July 2009, as suggested by our 5. Chronic NPA branches have been allotted to officials who Sponsor Bank i.e. State Bank of India. To tighten the criteria to are working in Head Office to monitor and reduce the qualify for better ratings, the Bank has raised the benchmark NPAs. for the Inspection ratings with effect from 01.09.2011. 6. NPAs between Rs.6.00 Lakhs to Rs.20.00 Lakhs in the For further strengthening of the audit system the new format of allotted regions were monitored by General Managers. RFIA has been introduced in the Bank w.e.f.01.10.2016 as 7. Review mechanism has been put in place. Regular review advised by our Sponsored Bank, with the following rating meetings are being conducted for Manager (Advances) system parameter-wise marks. and Regional Managers. 8. Wide publicity was given with regard to advantages on Revised Rating Range of Marks renewal of crop loans viz., enhanced scales of finance, Well Controlled - A+ >=850 crop insurance facility, interest subvention incentive from Adequately Controlled - A >700 and <=850 GOI and Vaddi Leni Runalu other government sponsored schemes by way of arranging meetings, displaying wall Moderately Controlled - B >600 and <=699 posters, Banners etc. Unsatisfactorily Controlled - C <600 9. Top management has conducted audio conferences at frequent intervals with Regional Managers, Manager The marks allotted under each parameter have also (Adv.), Desk Officers (NPAM),BMs for reviewing the been revised as under: reduction of NPAs. 10. Account Tracking Centre (ATC) - The officials posted at S.N Parameter Revised Format -Marks ATC continuously called borrowers under IRAC 1, 2, 4 and above for up-gradation of accounts. 1 Business Development 100 11. Five to six clusters in each region have been formed with 2 Credit Risk Management 450 officials having good track record for capacity building 3 Operational Risk Management 410 and reduction of NPAs. 4 External Compliance 30 12. Conducted auction for Gold ornaments pertaining to 5 Self-Audit 10 Personal Gold Loans which became overdue, at common date at quarterly intervals. Revised reporting format of Risk Focused Internal Audit (RFIA) has been implemented during the year, incorporating Asset Classification IS & IT Risk scrutiny in it. (Rs. in Crores) Branches with 'Well Controlled – A+' and 'Adequately 2016-17 2017-18 Asset Controlled - A' ratings are audited within 18 months from the O/s % O/s % previous audit date while the Branches with 'Moderately Standard 12158.79 98.30 14121.05 98.63 Controlled - B' and 'Unsatisfactorily Controlled - C' rated Sub Standard 36.69 0.30 26.27 0.18 branches are audited within a year. Bad & Doubtful 171.61 1.39 152.02 1.06 During the year 561 branches have fallen due for Audit and all Loss 1.43 0.01 17.35 0.12 561 branches have been audited. Rating acquired by 561 Total NPAs 209.74 1.69 195.64 1.36 branches is as under: Total Advances 12368.53 100 14316.69 100
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Rating Out of 561 Branches Income Audit audited during 2017-18 Income Leakage Audit has been conducted at 160 branches and Well Controlled - A+ 171 recovered Rs.549.70 lakhs. We have also arranged for Adequately Controlled - A 389 recovery of income leakage through Regional Offices at remaining branches and recovered Rs.856.75 lakhs, Moderately Controlled - B 01 aggregating to Rs.1406.45 lakhs during this year.. Unsatisfactorily Controlled - C - Special Audit Total 561 A special audit was also conducted in 21 Branches which have surpassed their budgeted growth over and above Rs.1.50 Crore to ensure all systems and procedures have been followed. The reports submitted by the Auditors have been dealt with by Compliance Audit: taking corrective measures, wherever necessary. The Compliance Audit was conducted at 48 branches during this Department has carried out its operations with fair and without year as per the schedule. prejudice which helped in strengthening the systems and procedures. IS Audit Out of 525 Audit Reports which have fallen due for closure IS Audit has been conducted at 11 Regional Offices and Head during the year, 506 have been dealt with and remaining Office including IT Cell with the help of CISA qualified retired Reports are pending for closure. These reports are overdue for SBI official as per the instructions of Corporate Centre, State closure for less than 3 months. Bank of India, Mumbai. Snap Audit – Audit of other Administrative Units: The schedule of Snap Audits have been advised to ROs on All the eleven Regional Offices and other departments i.e. monthly basis to depute Officials from Region to other Region Accounts, SLC, Stationery cell, HRMS have also been audited. to carry out the Snap Audit of Branches to have effective audit Audit Committee of the Board of the Branches. 924 Snap Audits have been conducted during the year 2017-18. The Audit Committee, constituted with one SBI-nominee- director as Chairman and nominee directors of RBI , Concurrent Audit NABARD and Govt. of India as members has met 4 times As a part of internal control system in our Bank, Concurrent during the year and reviewed the following areas: Audit is introduced from the financial year 2012-13 as per the · Position of Conducting of different Audits policy guidelines issued by NABARD. Keeping in view the staff availability, the Concurrent Audit is being conducted at 46 · Common irregularities observed in (a) Risk Focused branches with the help of four Auditors. We propose to Internal Audits (b) Snap Audit Reports (c) Concurrent audit empanel the retired Bank Officials to cover at least 50% of the (d) Bank Mitra Audit. Credit and other exposures of the Bank under Concurrent · Audit of Regional Offices, Accounts Department at Head Audit System in compliance with the guidelines issued by office NABARD. · Special Audits The Scope of Concurrent Audit is designed to cover (a) handling of cash (b) safe custody of securities (c) exercise of · Review and follow-up action on the Internal Audit Reports, discretionary powers (d) sundry and suspense accounts (e) particularly of “Unsatisfactory” branches and large clearing differences (f) off balance sheet items, security branches and also on Concurrent Audit observations. aspects, verification of Assets Quality etc. · Follow-up action on irregularities pointed out by Internal Bank Mitras Audit Auditors at large branches in RFIA and in the Concurrent Bank has introduced audit of Bank Mitras during the year and Audit Reports. audited 934 Bank Mitras' transactions. · Branches where audit rating is downgraded. Apart from this, the following audits have also been carried out · Compliance for NABARD inspection Report, Statutory to enhance the efficiency levels: Audit Report, Management Audit, RFIA, Snap Audit reports, Concurrent Audit reports, Bank Mitra Audit Report.
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· Fixing accountability for unsatisfactory compliance of 7. Procurement Policy Audit reports delay in compliance and non-rectification of 8. Policy on Internal Capital Adequacy Assessment Process deficiencies. (ICAAP) · Review on omissions on the part of Internal Inspecting 9. Investment Policy Officials/ Concurrent Auditors to detect serious 10. Policy on Inter Bank Participation Certificate (IBPC) - irregularities which come to light later Issue and participation on risk sharing basis · Periodical review of the accounting policies/systems 11. KYC / AML Policy controls in the Bank with a view to ensuring greater 12. Standard Operating Procedure (SOP) for Detection, transparency in the Bank's accounts and adequacy of Impounding and reporting of Counterfeit Notes accounting controls to address the risks faced or likely to 13. Policy on Dealing with incidents of Frequent be faced by the Bank. Dishonoured Cheques · Financial position – Balance Sheet and Profit & Loss 14. Policy on Depositor Education and Awareness Fund Account statement (DEAF) Scheme and unclaimed deposits / inoperative · Position of house keeping and Inter Office reconciliation accounts in Banks. (BCGA) and outstanding entries. 15. Internal Audit Policy · Certification of holding securities as reported to the RBI 16. Concurrent Audit Policy every quarter by Concurrent Auditor. 17. HR Policy · Status of frauds surfaced etc. 18. Transfer Policy 19. Training Policy Management Audit 20. Complaints Handling Policy The Management Audit of our Bank has been conducted by our 21. Information Technology (IT) Policy & Information Sponsor Bank, SBI. The audit has been concluded on Security (IS) policy 06.02.2018. We have submitted our compliance to the the 22. Information System Audit Policy Management Audit Report dated 06.02.2018 along with the final Action Taken Report to State Bank of India, Mumbai. 23. ATM Operations Policy Rating awarded 'A' 24. Internet Banking Policy NABARD Inspection under Section 35(6) of the Banking 25. Whistle Blower Policy Regulation Act 1949 26. Customer Rights Policy 27. Compensation Policy The NABARD Audit has been conducted as on 31.03.2017 and the Rating awarded is – A. Final Compliance for the Report 28. Ambiance Policy Dated 06.11.2017 is submitted on 05.01.2018. These policies are meant to help ensure that the Bank has an effective and proven systems and procedures on every key area Policy Framework of the Bank of the Bank's functioning. They also guide the operating staff We have tried to identify all areas of Banking and put in place a to comply with the regulatory requirements. policy framework for consistency in our approach. While Risk Management framing the Policies, all extant instructions of Reserve Bank of To enhance the monitoring mechanism and initiating India, NABARD, Sponsor Bank and general principles of corrective measures, Risk Indicators on some of the key areas banking as envisaged in various Acts governing the Banking, of Banking are identified and a tool is developed and put in have been taken into account. Our Bank has the following place as part of Risk Management. policies now on record, duly deliberated in the Board Meetings and approved by the Board. Depending on the periodicity and tolerance levels, each Key Area is assigned the undernoted colors which indicates the 1. Credit Policy level of risk and alert for taking corrective action. 2. Recovery & NPA Management Policy Green Colour-Acceptable: No immediate concern; 3. Risk Management Policy Amber colour-Increased concern: A potential problem that 4. Policy on lending against pledge of gold ornaments requires further review and analysis, Needs close monitoring 5. Provision on Rural Advances Policy and appropriate action to manage and bring back to Green 6. Policy for Empanelment of Investigative Agencies
40 Annual Report 2017-18 we are with you!
Red colour-Unacceptable: Needs immediate escalation for Financial Inclusion resolution and requires appropriate initiatives to bring it back Financial Inclusion has been the concern of Indian economy to Green and banking industry since the independence. Leveraging Key Risk Areas, Threshold limits - level of risk wise and technology is the basic idea behind our initiative in providing mitigation measures initiated are as under: Banking Services at the doorsteps of the unbanked and underprivileged people of the society. S. Key Risk Threshold No Indicator The rural poor had long been in the clutches of money lenders 1 BCGA Pending : to meet their immediate financial needs for decades. This traps Debit entries 1. Up to 3 days- Green, them into debt for their life time. There were no means for these 2. 3 to 7 days- Amber people to come out of these debt traps and lead a debt free lives. 3. Above 7 days- Red Thrift was an unusual habit in these group of people in the rural 2 e-VVR checking Pending: areas. 1. Up to one day- Green, 2. One to 3 days- Amber, As a Bank (established jointly by Government of India, State 3. Above 3 days-Red Bank of India and State Government) we have made difference 3 Loan mix: a) SHG 1. Up to 30%- Green , in their lives. Using technology has greatly galvanised our to total Adv 2. Above 30% & up to 40% efforts to bring in unprecedented transformation in providing - Amber, banking facilities to these people at their door steps. 3. Above 40%- Red 4 Loan mix: b) Personal 1. Up to 5%- Green , As part of financial inclusion, the bank has 1867 Bank Mitras loans to salaried class 2. Above 5% & up to 10% equipped with micro ATMs, operating 4444 villages which do to total Adv - Amber, not have a formal banking outlet of any Bank. Out of 4444, 825 3. Above 10%- Red villages are with population of 2000 and above and remaining 5 Time barred debts: 1. Up to 0.50%- Green 3619 villages with a population less than 2000. % to total Advances 2. Above 0.50% to 1.0% The Bank Mitras use the hand held Micro ATM devices to carry - Amber out the banking transactions in real time on our CBS platform. 3. Above 1.0%- Red 6 Missing documents: 1. Ideal - Zero Green, The following banking transactions are enabled at Bank Mitra % to total Advances 2. Up to 0.50%- Amber Points: 3. Above 0.50% -Red a. Account opening both SB & RD 7 Gross NPAs 1. Up to 1.75%- Green 2. Above 1.75% to 3.00% b. Cash withdrawal and deposit - Amber c. Receipt of loan installments 3. Above 3.00%- Red 8 Inspection Rating 1. Rated Efficiently Run / d. AEPS transactions both Onus and Off us Upgraded - Green e. Rupay Debit card transactions both Onus and Off us 2. Downgraded by one step - Amber f. Aadhaar Seeding facility. 3. Downgraded by two steps - Red g. Facility of mobile number seeding to bank account. 9 KYC Compliance 1. 100% - Green The entire Financial Inclusion (FI) operations at BCAs work on 2. 90% to below 100% - the principle of Biometric verification of the beneficiaries Amber through micro ATMs and are online, hitting our CBS server 3. Less than 90% - Red instantly through Third Party Integration, which facilitates The Bank has put in place the above monitoring mechanism updation of transactions carried out by BCAs on real time available to all levels of management and operating staff to basis, in CBS Server, via TSPs' Servers. initiate appropriate risk mitigating measures.
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The following is the share of transactions (%) performed at Lakh in case of death of the insured, due to any reason. The Bank Mitras when compared with the total bank transactions premium is Rs. 330 per annum which is to be auto-debited in one installment from the subscriber's bank account as per the % of Total Transaction Sl. Channel at Bank Mitra option given by him on or before 31st May of each annual No 2016-17 2017-18 coverage period under the scheme.. 1 Cash Withdrawal & Deposit We have enrolled new 57343 customers under Pradhan Mantri transactions 4.33 7.67 Jeevan Jyothi Bima Yojana during FY 2017-18, taking the total 2 AEPS-Onus 4.99 8.23 accounts to 2,29,323. Total 756 claims worth Rs 15.12 Cr 3 AEPS-Acquirer Offus 0.87 1.03 amount was settled under PMJJBY during FY 2017-18. 4 AEPS-Issuer Offus 2.03 3.18 5 Rupay Card transactions 0.06 0.13 6 Total overall percentage. 12.51 20.01 7 Cost of transaction at Bank Mitra (Rs) 10.67 14.47 No. of Bank Mitra transactions have increased from 4836690 (involving an amount of Rs. 569.70 Crore) to 5166545 (involving Rs.843.16 Crore) as on 31.3.2018. We are targeting a 30% growth in number of transactions for the FY 2018-19. As at the end of the FY 2017-18, no. of SB Accounts opened and maintained by Bank Mitras is 950922 (with a CASA balance of Rs. 118.98 Crore – Rs.74.07 Crore as on 31.3.2017) and we have set a target of 25% growth during the coming FY. No. of RD Accounts opened and maintained by Bank Mitras is 22458 (with a balance of Rs. 6.16 Crore) and we have set a target of 25% growth during the coming FY.
Financial Inclusion Accounts – Aadhar Seeding PMJJBY claim amount given to Nominee by Sub- Inspector of It is mandatory to link bank accounts with Aadhaar. To speed Police, Venkatapuram, Warangal. up the process of Aadhar Seeding, we have taken up the matter with Corporate Business Correspondent M/s Irix Technologies for developing a software for Aadhar Seeding through micro ATMs with Bank Mitras. We have organized a campaign titled “My Bank – My Account – My Aadhar” from 1st November 2017 to 30th November 2017, to encourage Bank Mitras for aadhar seeding. Out of 951144 Bank Mitras accounts, 809804 accounts (85.14% ) have been seeded with Aadhar. Financial Inclusion – Social Security Schemes (JJBY, SBY & APY) Pradhan Mantri Jeevan Jyoti Bima Yojana(PMJJBY) PMJJBY is a one-year life insurance scheme, backed by Government of India, renewable from year to year, offering coverage for death. People in the age group of 18 to 50 years PMJJBY Claim Settlement at Tekkali Branch of Srikakulam Dist. having a bank account who give their consent to join / enable auto-debit, are eligible. Aadhar would be the primary KYC for Pradhan Mantri Suraksha Bima Yojana(PMSBY) the bank account. The life cover of Rs. 2 lakhs shall be for the PMSBY is An accident insurance scheme and offers a one-year one year period stretching from 1st June to 31st May and will accidental death and disability cover, which can be renewed be renewable. Risk coverage under this scheme is for Rs. 2 annually. The Scheme is available to people in the age group 18
42 Annual Report 2017-18 we are with you!
to 70 years with a bank account who give their consent to join / Maker of Excellence Campaign from 07.12.2017 to enable auto-debit on or before 31st May for the coverage period 30.12.2017 1st June to 31st May on an annual renewal basis. Aadhar would PFRDA came up with another campaign to identify the be the primary KYC for the bank account. The risk coverage excellent and most influential leaders among the banks . under the scheme is Rs.2 lakh for accidental death and PFRDA prescribed 5 accounts for each Branch for enrolment complete disability and Rs. 1 lakh for partial disability. The and our Bank has secured the 6th position by enrolling 5351 premium of Rs. 12 per annum is to be deducted from the accounts, among Banks all over country and bagged Makers of account holder's bank account through 'auto-debit' facility in Excellence Award. one installment. We for Victory Campaign from 16.1.2018 to 31.1.2018 We have enrolled new 94717 customers under Pradhan Mantri Suraksha Bima Yojana during FY 2017-18, taking the total to During this campaign, PFRDA prescribed minimum 5 583793 accounts. Total 66 claims worth Rs 1.32 Cr amount accounts per branch to qualifying for consideration and was settled under PMSBY during FY 2017-18. announcing award for the top performer. Our Bank enrolled 2441 accounts during the campaign period. Atal Pension Yojana (APY) Splendid Seven Campaign from 07.02.2018 to 23.02.2018 APY is a pension scheme for unorganised sector workers such Our Bank has got 3rd position with 7217 enrolments among all as personal maids, drivers, gardeners etc., launched in June RRBs during recent APY- Splendid Seven Campaign 2015 by the GoI. APY aims to help these workers save money observed. for their old age while they are working and guarantees returns post retirement. Under the APY, there is guaranteed minimum Our Bank has been actively participating in Social Security monthly pension for the subscribers ranging between Rs. 1000 Schemes viz., PMJJBY, PMSBY and APY. We have and Rs. 5000 per month, depending on the entry age and conducted a campaign by name "Mee Samajika Bhadratha - monthly contribution. Maa Badhyatha" which literally means "Your Social Security is our Responsibility" from 16.11.2017 to 30.11.2017 to Aadhaar will be the primary KYC and all Bank Account educate and encourage the customers for enrolment under the holders aged between 18-40 years are eligible for enrolment. above three social security schemes. During this campaign Total of 25149 enrolments were mobilised under Atal Pension period, the Bank could mobilise 42465 enrolments under Yojana (APY) for FY 2017-18 as against 8038 mobilised upto PMSBY, 20853 enrolments under PMJJBY and 4180 FY 2016-17, with the active participation of the 768 branches. enrolments under APY. Average number of enrolments per branch under APY scheme Digital Financial Literacy Awareness Camps (dFLAPs) went up to 32.74 during FY 2017-18 whereas it was 10.46 as on Following the need of the hour and taking cues from RBI's 31.03.2017. policies and initiatives, our Bank launched Digital Financial APY Special Campaigns conducted by PFRDA Literacy Awareness Camps to create awareness among rural With a view to make India a pensioned society, PFRDA people and encourage them to use Card technology, ATMs, organized several campaigns to motivate Banks to contribute micro ATMs, PoS transactions, use Mobile Banking, Mobile to the Government of India's endeavor to make move our Wallets and to highlight the role of Bank Mitras engaged by the Society from Pensionless to Pensioned. PFRDA also Bank. Street shows have been deployed in the villages with prescribed enrolling minimum number of accounts per branch the above contents so as to attract the rural customers to to qualify for consideration and announcing award for the top upgrade their financial and technical skills. The publicity performer. We have actively participated in all the Campaigns, material in the form of pamphlets, brochures and banners were the details of which are as under: distributed during the camps to spread the message of financial Transformative Leadership Campaign from 01.09.2017 to awareness among the rural people. While we have conducted 11.09.2017 these programmes in 587 villages, NABARD sanctioned a grant assistance for 275 programmes. During this campaign, PFRDA prescribed minimum 15 Financial Literacy Centres (FLCs): accounts per branch to qualifying for consideration and announcing award for the top performer. We have actively With a prime objective to impart financial literacy in the form participated in the Campaign and enrolled 2492 accounts. of simple messages like 'why save with Banks, why borrow from Banks, why repay the loans in time' the Reserve Bank of Challengers Campaign from 12.09.2017 to 30.09.2017 - India has advised all the Banks to set up one Financial Literacy During this campaign, we have enrolled 1498 accounts. 43 Annual Report 2017-18 we are with you!
Center (FLC) each in the operating districts of the Bank. The Ramachandrapuram in Hyderabad on 22.01.2018. Bank has opened 8 such Financial Literacy Centres in 8 Customers can do new enrolments at this centre in addition to districts viz., Srikakulam, Vizianagaram, Visakhapatnam, getting modifications to the exiting cards. For new enrolment, Khammam, Warangal, Nalgonda, Mahbubnagar and Medak in the Bank does not charge any amount, while for demographic tune with the guidelines issued by the NABARD. The Bank modifications such as address, name, gender, date of birth etc., has posted retired Bank staff to look after the affairs of FLCs as they need to pay Rs.30/- (incl GST) in the Branch. counselors. These FLCs are located at the district centres and Our Bank has opened 43 Aadhar enrolment and updation housed in the Regional Offices. The Financial Literacy centers as on 31.03.2018 as per UIDAI guidelines Counsellors have conducted 1109 Financial Literacy Cross Selling Awareness Camps during the year. SBI Life Insurance Our Rural Branches have conducted a total of 5473 Financial Literacy camps during the year. The Bank is a corporate agent of SBI Life Insurance Corporation Limited, to meet the life insurance needs of the UIDAI-Migration to Registered device Services: All biometric Bank's customers, as part of Financial Inclusion apart from devices used for authentication of customer KYC, using earning non-interest income. The Bank mobilized a New Aadhaar number have been migrated to Registered device Business Premium (NBP) of Rs. 22.68 Crore against the target services. The biometric devices both at branches and Bank of Rs. 21.56 Crore and earned a commission of Rs. 3.02 Crore Mithra's have been migrated to RD services. during the FY 2017-18 vis-à-vis the NBP of Rs.18.54 crores and commission of Rs.2.14 Crore during the year previous FY Aadhar Enrolment and Updation Centres 2016-17. Following the mandate from Government of India for all the SBI General Insurance Banks to open Aadhar Enrolment and Updation Centres in We have commenced SBI General Insurance Business during atleast 10% of their Branch network, our Bank has initiated the the year 2015-16 as a Corporate Agent to market two Insurance task of opening Aadhar Enrolment Centers at 76 locations to products viz., Group Health Insurance Scheme and Group extend the services of aadhar enrolment and updation to the Personal Accidental Insurance Scheme apart from insurance to public including our customers. Bank officials will assist in the Assets financed by the Bank to the eligible and willing enrolment process.148 officials have been identified to customers. The Bank mobilized a business premium of Rs supervise these Aadhar Enrolment Centres. As part of this 12.86 Crore during the year 2017-18 against the target of exercise, the Bank has conducted a Training progamme for Rs.7.50 Crore vis-à-vis Rs.7.59 Crore business premium these officials in Hyderabad on 09.01.2018 with the inputs by during the previous FY 2016-17. The Bank earned a UIDAI Official. commission of Rs. 77.44 Lakhs for the year 2017-18. vis-a-vis Our Bank has inaugurated the first Aadhar Enrolment and the commission of Rs. 28.18 Lakhs for the year 2016-17. Updation Centre in our Ashoknagar branch, near
Inauguration of Aadhaar Enrollment and Updation Center GPAI claim settlement of Rs, 4.00 Lakhs to the customer of our Shivampet Branch (Sangareddy RO)- Shri M Ravi, AGM & RM handing over the cheque
44 A standing definition of outreach and financial Literacy 45 Annual Report 2017-18 we are with you!
Information Technology over four transactions during the Financial Year, involving an Handholding the undereducated and rural population to a amount of Rs. 246.81 Crore. No. of transactions put through technology driven banking has been the hallmark achieved by the Mobile Banking app, works out nearly 2.75% of the total our bank during the year. The IT initiatives introduced during transactions. the year have more to do with the customers willing to embrace Our Bank's mobile banking services have been well received it. Although the IT has been engulfing all sectors in urban by the customers and their satisfaction can be gauged from the areas, it is slower in rural areas - particularly banking space. rating awarded by them to the mobile banking app on the Large number of our clientele is in farms and do not have great Google play store feedback platform. The mobile banking app urge to go tech-savvy. The way things are moving towards has been receiving a consistent rating of 4.4 on the platform complete transformation with IT, left alone, Rural will also and the downloads have reached 1,00,000 +. catch up with the technology but at its own pace. We have accelerated the penetration of technology in rural areas, by educating and sensitizing the rural folk. Mobile Banking introduced during the last financial year and other Alternative Delivery Channels , has been popularized widely among the rural customers. We have conducted campaigns, awareness programmes, instilled competition among operating staff in Branches and Regions, to take the IT Products and services to the rural customers. The Bank has introduced the following new IT initiatives during the year: Immediate Payment System (IMPS) Remitter IMPS facility as beneficiary bank was launched in January 2016 as sub member of Sponsor Bank. After IMPS accounting procedure was put in place by SBI for RRBs, IMPS with remitter facility was launched in July 2017 in our Bank. A. Mobile Banking: It is a new experience for a farmer to do banking while in farm. Bilingual, the mobile banking app is a user friendly. The availability in vernacular language has made it acceptable to the rural customers. The app is compatible with, Android, iOS and Windows mobile operating systems. The requirement of a PIN mailer for registration/activation has been done away with as a Go Green initiative. Mobile Banking app offers remittance of funds through NEFT, IMPS, transfer transactions There is a huge potential for the Mobile Banking Services in within the bank and balance enquiry. Customers can also raise our Bank. Out of 34 Lakh SB Accounts, over 50% accounts cheque book requests for their accounts linked to the CIF have been seeded with Mobile Numbers. Similarly out of 15 through mobile. This has enabled the bank to attract new Lakh BSBD Accounts, 49% accounts have been seeded with customers and retain the existing customers. Mobile numbers. The transactions through Mobile Banking are secured with Mobile Baning Facility – On Feature Phones: *99# three way authentication i.e. MPIN to access the services and TPIN to perform financial transactions, the third factor of We have also implemented *99# facility, another strategy of security, is authentication of a financial transactions by the mobile banking by NPCI for our rural customers with regular onetime pass word flashed to the registered mobile of the feature phones. Internet (data) connection is not required to customer. avail banking services using *99# and this facility can be used across all major Telecom service providers and avail Banking More than a lakh customers have activated Mobile Banking services 24 x 7 seamlessly. Banking services on feature service and each customer has carried out on an average a little mobile phones is available in multiple languages and also
46 Annual Report 2017-18 we are with you! available in Telugu. The *99# facility can be availed on the our bank. Using this facility our bank customer would be able mobile number that is linked to the customer's deposit account to perform cash less transactions at outlets using other bank only. Financial services that can be carried out using the *99# Aadhaar pay apps. facility are: (a) Transfer funds using Mobile No (b) Transfer Missed Call Banking: funds using UPI ID (c) Transfer funds using Aadhaar No. (d) Transfer funds using Account No + IFSC code (e) Request Many of our rural customers, particularly the beneficiaries of funds transfer from others using UPI ID or Mobile Number. DBT and Government Sponsored Schemes, come to branch to Non Financial Services such as (a) Account Balance enquiry know their account balance, thereby losing their daily wage (b) Set up UPI PIN (c) Change UPI PIN and (d) Last five (5) and incurring travel expenditure. To mitigate the hardship of transactions. hand-to-mouth customers, the Bank introduced Missed Call Banking to know their account balance. The customer through Unified Payment Interface (UPI) Services the mobile registered with the account has to give a missed call UPI is the most sophisticated public payments infrastructure to a predefined number to get an SMS showing the account which our Bank has extended to our customers in January balance. This facility is available 24 x 7 and has considerably 2018. UPI simplifies online payments and it is way ahead of reduced footfalls at the branch counters and enhanced the NEFT / IMPS / digital wallet such as Paytm with regard to customer service at the counters by cutting down the waiting convenience. UPI is a layer over existing IMPS facility. time. The following benefits accrue to the customer who uses the UPI services of the bank. 1. The enabling of the UPI facility has revolutionized funds transfer by our customers and made it as simple as sending a message. 2. Immediate funds transfer through mobile devices round the clock 24 x 7, 365 days of the year. 3. Our onboarding the UPI platform enables our customer to use a single mobile application made available by NPCI, Bharat Interface for Money (BHIM) for accessing different bank account and carrying out their transactions. 4. UPI facilitates the use of virtual address for performing banking transactions. 5. The customer using UPI facility can make payments for purchases made at merchant establishments by scanning the Quick Response (QR) code. 6. Customer can raise complaints regarding transaction status directly from the BHIM app. Within a short span of 3 months from the date of launching, 339184 transactions involving an amount of Rs. 62.62 Crore have taken place through UPI. This is an initiative which has instant impact on the customer Internet Banking -Transaction Facility service in the most inevitable area of banking i.e., need to know the balance. After approval for rolling out Internet Banking facility with transactions rights has been granted by RBI, Transaction rights In order to popularize and maximize the usage of missed call on the Internet banking platform of the bank have been banking, we have displayed Banners prominently in the launched in February 2018. branches and important location of the villages, depicting the facility. In all Financial Literacy Camps and in Grama Sabhas, AEPS-Aadhaar Pay: the demonstrations were given to the villagers to provide a feel To enable our customers to perform cash less transactions at of the facility to the rural folk. merchant establishments using their Aadhaar linked account of Out of 51,17,626 active customers, 26,45,831 customers have our bank, Aadhaar Pay (Issuer) facility has been launched in registered their mobile numbers to their accounts. Of this,
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17,82,236 customers have registered for Missed Call Banking festival seasons. facility. As at the end of the FY, 1558048 SMSs have flashed in Bank has also launched a campaign by name Multitasker to their mobiles. encourage staff in promoting activations and transactions in Alternate Delivery Channels (ADCs): digital products of the Bank, like Mobile Banking, ATM Card & POS machine installation. The best performers Region and Banking transactions through Alternate Delivery Channels has Bank wise were recognized and awarded incentives. been on the rise vis-à-vis transactions through brick and mortar branches, reducing the footfalls considerably in the Branches, Rupay BigBazar Campaign: Our Bank also participated in thereby resulting in more focus on marketing and business this campaign launched by NPCI who entered into a corporate agreement with Big Bazar a reputed multi chain retailer in development. Various alternative delivery channels introduced India. The agreement envisages to provide a discount of 10% by the Bank has enabled the customers to avail banking on the purchases made using Rupay Debit cards. The services 24 x7 at their convenience. The following table shows maximum discount has been pegged at Rs 250 per the volumes and cost benefit analysis on transactions through customer/card. The campaign was conducted for a period of 38 branches and ADCs. days from 23.03.2018 to 30.04.2018. This was to promote the Branch ADC usage of cashless transactions mode amongst our customers, S increase ATM Debit card transactions and our customer would N Particulars 2016 2017 2016 2017 -17 -18 -17 -18 be benefited with the discount offered by the corporate 1 Avg Transactions RTGS/NEFT direct Membership: per day 69292 70091 88191 144757 Our Bank has obtained approval from RBI for participating in 2 Avg % of the Centralized Payment System of RBI as Director Member. transactions 32.62 44.00 56.00 67.38 We have also obtained RTGS Membership and INFINET 3 Cost per membership and opened RTGS settlement account and transaction (Rs) 116.27 107.50 5.08 4.50 SGL/IDL-SGL account. Our participation in Centralised Payment System will be functional in the coming FY. Rising trend of remittance of funds and banking transactions using ADCs is shown in the following table. Desktop ATMs 2016-17 2017-18 In a move to facilitate customers wanting to withdraw small S Payment No. of Volume No. of Volume amounts, the Bank has installed Desktop ATMs in five of our N Mode transac per day transac per day Branches on a pilot basis. tions (Rs. Cr) tions (Rs. Cr) This is the first time, our Bank has come up with a plan to set up Per day Per day Desktop ATM in our Branches and this is a unique model 1. CTS 1187 7.00 1487 12.00 where it works like any other ATM and other Bank customers 2. RTGS 91 7.99 103 16.86 can also withdraw their money. With desktop ATMs, there is no need for separate ATM room and there is no security 3. NEFT 15209 28.15 26561 33.90 problem. 4. ECS 2312 0.08 20425 0.53 5. IMPS 204 0.04 1377 12.05 6. POS 2689 0.04 4726 0.63 7. ATM 15222 2.81 22765 4.95 8. AEPS 26561 3.60 43474 5.87 9. Mobile Banking Services 269 0.17 1098 0.90 10. NACH (APBS & ACH) 29281 0.36 54908 7.01
Campaigns to promote Cashless Transactions We have launched many campaigns to promote cashless transactions using our ADCs. A campaign named Festival Inauguration of Desktop ATM in our Patancheru Branch on Dhamaka was launched to promote cash less transactions 29.01.2018 by Shri S. Ganesan, General Manager (RRBs), A&S amongst the customers of the bank was launched during the Department, State Bank of India, Corporate Centre, Mumbai
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as to ensure that technology implemented in the banking operations are not misused by any insider. In the manual system, there used to be certain issues pertaining to responsibility / accountability of the operating staff in regard to the verification and more importantly the monitoring aspect as to ensure 100% checking. Online Voucher Verification system automated the checking of transactions online by a person other than the checker or maker. This acts as a deterrent in perpetuating fraudulent transactions. The controller has been provided an effective tool for verifying the pendency of VVR checking at branches from a central location. This has also effectively eliminated the necessity of printing the Voucher Verification Reports saving paper, time and space Visakhapatnam Collector Sri Praveen Kumar, IAS, inaugurating the and curtailing the usage of peripherals like printer, leading to Desktop ATM in our Kancharapalem Branch (Visakhapatnam city) on Go Green initiative. 21.2.2018. New NPA Module: 1. The health of loans and advances are system tracked. The NPA tracking is carried out on a daily basis. The IRAC status of the loan accounts identified by the system was studied and the following steps initiated to improve the accuracy of the system identification. a. Data Gap in the loan/advances accounts as per the system was shortlisted. b. The data gaps were shared with the branches and updated as per the loan documents. c. The errors in classifying the loan accounts by the system were studied to eliminate the error in system tracked NPAs. Visakhapatnam Collector Sri Praveen Kumar, IAS, withdrawing cash from the Desktop ATM after inauguration. d. A new NPA module was developed and promoted to address and fix all the bugs in the old NPA module and POS Machine Installation promoted. During the year, our Bank has also took up the initiative of NPA MIS Reports: installing PoS machines (as sub member of SBI) at merchant establishments, who are our Bank's customers. Necessary Success of our Bank in effectively monitoring the Loan agreements have been entered into with the respective SBI Accounts and initiating appropriate corrective action in circles and 454 applications have been sourced for installation. avoiding / reducing the NPAs, can be attributed to NPA Reports This will be functional during the next FY. generated and made available to all levels of administration. Online Voucher Verification System: MIS Tool for Branches: An MIS tool was developed for generation of customized NPA reports at the branches using During the year, the Bank has introduced and implemented the available loan balance file in the branch reports. This is a online Voucher Verification System. Earlier, each transaction user friendly tool and any branch staff can generate NPA MIS put through CBS, supported by a Voucher used to be checked report in the format he/she likes. This tool has been deployed at manually with the Voucher Verification Reports generated all the branches for their convenience, to work out their own from CBS tallying with the physical vouchers. The timely strategies for tackling their NPA accounts. This tool is also checking of the Voucher Verification Report(VVR) is a very made available on the intranet for downloading and use. important function which would bring out the correctness of the transaction performed by the CBS user and also brings out Beyond the above the bank controllers at all levels are any fraudulent/mischievous transaction that has been provided with NPA MIS reports on daily basis. The reports are perpetuated by any fraudulent user of CBS. This function of provided branch wise, region wise, segment wise and IRAC VVR checking also need to be monitored by the controllers so 49 Annual Report 2017-18 we are with you! status wise. The NPA MIS reports are analyzed for slippages requirement in all the systems of the bank to remove any and the stake holders sounded for corrective measures to be vulnerability on this account. implemented at the Head Office and Regional Office levels. The effectiveness of information technology is the continuous The daily slippages are flashed through SMS messages and in availability of all the services to the branches to carry out daily WhatsApp groups at central level and regional office levels. business and the customers for availing banking services at The regional offices also communicate with the branches the their convenience. NPA slippages individually. The NPA position is reviewed in The CBS platform functions on Wide Area Network (WAN) the monthly reviewing meeting at bank level and regional which functions on connectivity provided on various carriers office level and necessary instructions and corrective measures like VSAT, RF and MPLS leased lines. A tool is developed and adopted. Recovery teams are formed to assists branches in deployed in the Bank to monitor the continuous availability of recovery operations where ever the slippages are felt to be connectivity at branches and to ascertain the reasons for loss of monitored closely for recovery. connectivity and necessary steps initiated for restoration. This The adoption of technology in classifying, tracking and has enabled our bank to maintain connectivity uptime at 99%. monitoring of NPA has assisted in bring down the NPA of the Branch Connectivity Upgradation: bank from 4.43% in 2013-14 to 1.36 % in 2017-18. As the volume of transactions have increased over the years, to Audit Sampling Reports: enable branches to perform transactions at a faster rate To facilitate improvement in the quality of audit during Branch upgradation of the branch connectivity to 2 Mbps RF has been audit and inspection, a facility to generate random sample taken up. As on 31.03.2018, 408 branches have been upgraded accounts to be verified by the branch inspector has been put in to 2 Mbps RF connectivity. place. DR Drill: As a measure of security and part of disaster Information Security: recovery plan, our ASP M/s C-Edge Technologies Ltd, The bank pays utmost importance towards safeguarding the Mumbai, has conducted DR Drill two times during the year information technology assets of the bank. The Bank has and were smooth. The problems faced in earlier DR drills have formulated, Information Security Policy, Information been addressed and did not recur in these drills. The short Technology Policy, Information Security Audit Policy & comings noticed have been brought to the notice of the ASP for Internet Banking Policy and implemented after obtaining analysis and rectification. Board's approval. As a policy, the Information technology Computer Security Day assets of the bank at our Application Service Provider M/s C- Computer Security Day was observed on 30.11.2017 at our Edge Technologies Ltd, are subjected to information security Head Office, at all our Regional Offices and Branches. review on yearly basis by an external IS audit agency. Bank's Handouts and brochures were distributed among staff to create controlling offices are subject to Information Security Audit by awareness on computer security and safe working in external agency at periodical intervals. Information systems computerized environment. audit is part of Risk Focused Internal Audit systems (RIFA) of the bank which plays an important role in the assessment of the IS assets and practices in use at the branches during branch audits carried out by Internal auditors of the bank. Anti-virus is installed and monitored in the bank centrally. The patches of antivirus in branch servers are updated regularly. In client systems the up-dation of antivirus is taken up by the AMC providers. Regular instructions and updates are provided to the branches to caution them in regard to any impending threat. The use of external media is disabled at the branches to arrest spread of any attack from the external media. Biometric authentication system for login to the CBS application was introduced. This eliminates login of unauthorized persons into the application and also aids in fixing accountability for any frauds or malpractices. The use of Release of computer security handouts-from left: Shri TV Krishna operating systems is monitored and updated as per the Reddy, GM-II, Shri K. Ravi Kiran, GM-IV, Shri V. Narasi Reddy, Chairman & Shri G. Sreedhar Reddy, Chief Manager (IT)
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Security Measures – Installation of CCTVs and Burglar from LCPC which has a direct impact on the brand image Alarm Systems of the bank. Cheque books can be indented by the Physical security systems that effectively protect the Bank customer using mobile banking, internet banking, branch assets, customers and employees assume paramount and would be directly delivered to the customers address. importance in view of increasing incidence of robberies, e. Due to the centralization of liabilities at LCPC the bank mischief. The Bank has provided CC Cameras & Burglar could achieve aadhaar seeding to 96.2%. Alarms to all 768 branches of the Bank. f. E-Returns: A technological initiative for returning the Liability Central Processing Center (LCPC): KYC deficient account opening in the form of images, to To keep in pace with the high trajectory business growth and to monitor resubmission and processing was introduced. maintain the quality of liabilities of the bank Liability Central This eliminates physical movement of account opening Processing Centre (LCPC) was established. This has enabled forms to branches, and also eliminates the delay in time to the bank to comply with the statutory regulations stipulated by deliver the physical forms. RBI and other statutory bodies in respect of the customers that are availing banking facilities from this bank. The following Customer Service & Complaints handling quality aspects of the liability assets of the bank are taken care While complaints cannot be avoided, some of the complaints of at the LCPC. provide useful feedback to review our performance and systems and procedures. A genuine complaint from a customer a. Compliance towards Know your customer (KYC) norms means an opportunity to the Bank to upgrade our skills and for the accounts opened at the branches are ensured. efficiency. The Bank has put in place complaint-handling- b. The customer images like photo graphs and signatures are policy to redress the grievances of the customers and improve ensured in the system. the quality of customer service. The Bank has placed enormous emphasis on timely disposal of complains and c. The account opening forms of deposit accounts are stored follow up system has been strengthened to dispose off the in a safe and secure environment at LCPC, which can be complaints within timelines set. All Branches are conducting retrieved in case of any dispute or frauds. customer meets every quarter and important customers are d. Personalized cheque books are arranged to the customers invited. Their views and opinion were solicited in order to take
Driving Banking Technology in Rural Areas
51 Annual Report 2017-18 we are with you!
Sub Committee of the Board on Customer Service had a meeting with customers of our Ashoknagar Branch on 20-03-2018. Our Chairman Shri V. Narasi Reddy, RBI nominee director Shri MS Hari Shankar, NABARD nominee Director Shri VS Gupta, Our General Manager -I Shri M. Satyanaryana, Our AGM & RM Shri BRV Manoj Kumar & Shri DV Gurunadha Rao, Chief Manager Ashoknagar Branch have participated in meeting Customer Complaints: Status as on 31.03.2018 SNo Particulars No. corrective steps, wherever necessary. Regional Managers concerned are attending the customer meetings whenever 1 No. of Complaints pending at the Beginning feasible. The following system of monitoring of complaints of the year 01 for their redressal and submission of compliance is in vogue: 2 No. of Complaints received during the year 2017-18 135 3 Total Complaints 136 Nature of Officer in charge at At Head 4 No. of Complaints Redressed / complaint Regional Office / Branch level Office level Disposed-off during the year 136 General Complaints Branch Manager Chief Manager 5 No. of Complaints pending at the end (Other than (At Br level) (Board) of the year Nil vigilance nature) Regional Manager General Manager For complaints received through Banking Ombudsman, (at RO level) -IV General Manager-IV is designated as “Principal Nodal General Complaints - Chief Manager Officer” of our Bank at Head Office. The position of (Vigilance nature) - (Vig&DP) complaints received through / from Banking Ombudsman General Manager-I during the year. Complaints from Regional Manager / Chief Manager Banking Branch Manager (Board) SNo Particulars No. Ombudsman General Manager 1 No. of Complaints pending at the Beginning - IV of the year 01 2 No. of Complaints received during the year The status of complaints both received directly and through 2017-18. 43 Banking Ombudsman, is being put up the Board of Directors in 3 Total Complaints 44 every meeting for their review and information. 4 No. of Complaints Redressed / Disposed-off Sub-Committee of the Board has conducted a meeting with the during the year 43 customers of our Ashoknagar Branch on 20.03.2018 and 5 No. of Complaints pending at the end interacted with them on the Bank's services, products etc. The of the year 01* Board of Directors Shri V. Narasi Reddy, Chairman, Shri M.S. Hari Shankar, RBI Nominee Director, Shri V.S. Gupta, * Banking Ombudsman Compliant received during last week NABARD Nominee Director who are members of the Sub- of March 2018. Committee to the Board on Customer service have participated in the Customer Meet. Whistle Blowing Policy with an objective of providing an avenue for raising concerns related to frauds, corruption or any other misconduct is also in place. The Bank has also installed a Toll Free Number to receive feedback from the customers on the Bank's services.
52 Annual Report 2017-18 we are with you! e-Complaints Management Officers S-V 7 The Bank has developed an e-Complaints Management Officers S-IV 51 System with the in-house IT talent, to redress the grievances / complaints from customers on a quickest possible time. This Officers S-III 188 system seeks to centralize all complaints, received through our Officers S-II 477 Website's complaints box, email, Toll Free Number, or post at Officers S-I 1202 any level, either at Branch or RO or Head Office and raise a Office Assistants 1151 ticket. Admin identified at Head Office, will direct the Office Attendants 84 complaints to the concerned Department and / or concerned Total 3160 Department Head Office for redressal. Access to the e- complaints system is given to the identified Officials in Attn Regional Offices and Head Office to ensure that each and every 84, complaint received at all levels are captured in the System so as 3% to monitor the complaints for timely disposal. Formal Assts Officers launching will be done in the coming financial year. 1151 1925 Effective handling of complaints is fundamental to retain the 36% 61% existing customers and attract the new customer base through word of mouth. We seek to achieve prompt and effective redressal of customer complaints through the e-Complaints Management System. Right to Information Act During the year, 115 staff members have retired from the Bank's Service. 92 staff members have resigned, 3 staff The Bank implemented the Right to Information Act, 2005 in members were removed from service. 7 Staff members letter & spirit setting out the practical regime of right to expired during the year. information for citizens to secure access to information under Recruitments the control of bank in order to promote transparency and accountability in the working of bank's various functionaries. Since 2009-10, the Bank has been recruiting staff through IBPS, as per manpower assessment and requirement At the Branch level, the Branch Manager has been designated st undertaken as on 31 March of every year in terms of Thorat as Central Assistant Public Information Officer while the Committee recommendations, presently as per Mitra Regional Manager concerned is designated as the Central committee recommendations approved by GOI. Last seven Public Information Officer. At Head Office level, the Law years have witnessed mass retirements of those staff members Officer is the Central Assistant Public Information Officer and who had joined erstwhile RRBs in late 1970s and in 1980s. the Chief Manager (Audit & Inspection) is the Central Public Accordingly, based on the business volumes as on 31.3.2017, Information Officer. The General Manager – III has been the Bank has taken up recruitment exercise for augmentation of designated as Appellate Authority in the Bank, under RTI Act. staff in various grades, including lateral recruitment of Scale-II During the year 2017-18, the Bank has received 67 applications and Scale-III Officers in General Banking and with and 24 appeals and disposed off all applications and appeals specialization in Law, IT, Marketing, Treasury, CA etc within the stipulated time frame.
Grade No. of Candidates recruited Human Resource Management during the year As at the end of FY 2017-18, the staff strength (excluding those 1 Office Assistants 153 who exited the Bank service in the month of March 2018 on account of retirements / resignations) and its composition is as 2 Officers Scale-I 133 under: 3 Officers Scale-II 95 4 Officers Scale-III 8
53 Annual Report 2017-18 we are with you!
As at the end of FY 2017-18, there are 158 Scale-II Officers and 25 Scale-III Officers directly recruited from the market The Bank has also deputed 78 Officers, essentially in the laterally. higher cadres, to external training institutions like BIRD The Bank's in house Learning Centre has been working (Lucknow), RBI (CAB, Pune), BIRD (Mangalore), State Bank continuously to train and re-train the new recruits imparting Learning Centres on important subjects like AML, ALM, skills and supply inputs in all areas to equip them to handle the KYC, RTI Act, Treasury Management, Business Development day to day functions well. All the recruitments have been etc. completed through the Common Written Test including Our Bank has been paying consistent attention towards women interviews conducted by IBPS. employees. They constitute roughly 21 % of total workforce. Bank has taken a number of steps to boost women
3500 New Staff Old Staff 3000
2500 283 541
2000 1707 2220 1997
1500
1000 2060 142 1953 1813 16591502 818 1429 1241 1414 1244
500 940 1015
0
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Trainees of our Staff Learning Center, being given practical exposure at the Farmer Producer Organasation (FPO) Promotions Keeping in view the Bank's policy of giving promotions empowerment within the Organisation. They are talented and promptly to staff, we have taken up promotion exercise in highly enterprising. It is very gratifying that most of the terms of manpower assessment as on 31.03.2017 and women officers volunteered to be the Branch Heads and Field promoted as many as 186 people in various cadres to next Officers which call for working in pressure situations. higher grade as under. Written Test for promotion was Contribution of women staff members in the growth story of arranged through IBPS online. the bank is significant. Management Development Programme for Women Officers: S.No Promoted to No. of Posts We have conducted one day workshop on Management 1 Officers Scale-I 55 Development Programme on 10.8.2017 and 27.11.2017 in 2 Officers Scale-II 48 Hyderabad and Visakhapatnam respectively involving around 3 Officers Scale-III 55 100 women Officers. The workshops were handled by our 4 Officers Scale-IV 20 own Staff who were trained in BIRD Lucknow. 5 Officer Scale-V 8 Internal Complaints Committee – We have also put in place a 6 Office Asst. 0 safe working environment for women employees in the Bank 186 by implementing the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) The Bank has fulfilled the statutory requirement of giving pre- promotion training to all SC/ST candidates, eligible for Act, 2013. We have constituted Internal Complaints promotion, prior to written test. This has enabled the SC/ST Committee at 11 Regional Offices and at Head Office to handle candidates to prepare themselves better, to take on the written test. the complaints of sexual harassment. We have been Training - Staff Learning Centre sensitizing the employees of both the genders to be fostering a healthy and conducive work environment. The Bank had laid down a Training Policy which envisages training to all staff members, atleast once in three years. During the year, APGVBSLC has conducted 46 training programmes and provided training to 1379 staff members. The participants include all cadres of staff (Officers-962 and Off. Assts417)
54 Annual Report 2017-18 we are with you!
International Womens Day Celebrations on 08-03-2018
55 Annual Report 2017-18 we are with you!
Pressing for Progress Winners of elocution competition on the occasion of International Womens Day from all categories
1st Best BM 1st Best FO 1st Best Accountant Mrs Jhansi P Mrs P Divya Vani Ms S Lakshmi Nirosha
1st Best Accountant 1st Best O. Asst. 2st Best BM Ms P Rajani Mrs Swapna Kumari Mrs B Swathi
2nd Best FO 2nd Best Accountant 2nd Best O. Asst. Mrs G. Sravanthi Mrs Nishath Sultana Ms Pydi Sandhya
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International Women's Day: As a policy we have been Celebrating International Women's day on 8th March every year. This year also, we organized a programme to acknowledge their contribution and achievements on 8th March 2018. It was not a routine felicitation programme. To bring out their leadership qualities, we have given the following topics with only 15 minutes time for delivering speech. Branch Administration, Importance of KYC, Banking Technology, Future of Banking Technology, Alternate Delivery Channels, Frauds in the bank – What needs to be done, Monitoring and control mechanism in banks, Operational Risk in Banks, Role of RO in Branch banking, Women empowerment, Training system in our Bank, Importance of Learning, Leadership , Know Your Branch, Importance of KYE, Importance of communication skills in leadership, HR Practices in our Banks, Preventive vigilance in Banks, Customer service , Gender equality in APGVB, Social media – Boon or curse, Cashless economy, What should be our Credit Policy, Women as Managers, Impact of demonetization on common man etc. This was an instant hit and all the participants have chosen one or the other and spoke with precision and come up with a presentation with Pressing for Progress appropriate suggestions and views.
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Staff welfare Measures Industrial Relations Mediclaim policy The Management and Officers Association and Employees In terms of Government of India letter No: F.8/1/2015-R RB Union have worked in tandem for the welfare of the staff dated 20.10.2016, our Bank has implemented Medical members and business development, sorting out amicable Insurance Scheme as per Xth Bipartite Settlement to solutions for routine issues that cropped up during the year. employees and officers along with their dependent family Cordial and amiable working atmosphere has prevailed during members as detailed in Schedule IV. The Scheme covers the year. Employee + Spouse + Dependent Children + 2 dependent Welfare of SC/ST and OBC Employees Parents / parents-in-law with a Sum Insured of Rs.4,00,000 and The Bank has maintained cordial relations with the SC/ST Rs.3,00,000 for Officers and employees respectively. We have Welfare Association and OBC Welfare Association and also taken a Corporate Buffer to cover additional expenditure complied with statutory requirements in all aspects of upto Rs.4.00 Lakhs and Rs.3.00 Lakhs for officers and recruitments, promotions etc. The Bank has held regular employees respectively, if the hospitalization expenditure meetings with the representatives of Welfare Associations and exceed the sum insured. The Scheme, apart from facilitating Liaison Officers to redress their grievances. hassle free admission into the hospital immediately and payment of cash, makes the settlement of hospitalization The Bank has taken all steps to keep up the morale and expenses become much easier, saving administrative time motivation of the employees. considerably. The scheme also covers domiciliary treatment Settlement of Terminal Benefits expenses up to 10% sum insured. The Bank has made a policy that all terminal benefits are Around 10000 members including family members of Staff settled on the date of retirement of staff members. The process have been covered under the Scheme. begins two months in advance of retirement to ensure that all Group Personal Accident Insurance Policy formalities are completed to make payment on the date of retirement. Most of our staff members are youngsters and travel by road, frequently for various official works viz., Cash remittance, Payment of Ex-gratia field visits for recovery and inspection of units, review The Bank has implemented the GOI instructions, contained in meetings etc., and are exposed to the risk of road accidents and their notification No: F.20/5/2003-RRB dated 9.6.2006, on face a life threat also. payment of ex-gratia in lieu of appointment on compassionate We have taken the Group Personal Accident Insurance Policy grounds for the legal heirs of the bereaved staff members and with the following sum insured to create a sense of security also to the staff who are chronically sick and immobile on sick among the staff members and build loyalty to the organization. grounds. Vigilance Administration SN Cadre Sum Insured As the Bank is growing in size and with the infusion of young 1. Officer Scale-III & IV Rs 10 Lakhs and inexperienced workforce, who now constitute over 70% of 2. Officer Scale-I & II Rs 7.50 Lakhs total staff members, vigilance together with sensitization to be 3. Office Assistants Rs 5.00 Lakhs vigilant has been thrust area for the Bank. 4. Office Attendants Rs 3.00 Lakhs A new set up of Vigilance administration has been introduced in the Bank with the active involvement of Sponsor Bank vide Our Bank has been facing severe attrition causing acute staff their letter No: A&S/RRB/SKJ/416 dated 12th Sep 2017 after shortage and these measures will boost the morale of the staff obtaining the Board's approval. members. Chief Vigilance Officer of State Bank of India is overseeing the Gratuity and Leave Encashment Fund Vigilance Administration of our Bank, through Deputy The Bank has taken care of provisional requirements in respect General Manager (Vigilance), State Bank of India, LHO, of Gratuity. The total corpus as on 31.3.2018 is to the tune of Hyderabad. Rs 155,76,85,180/- (Rupees One Fifty Five Crore Seventy Six Deputy General Manager (Vigilance), on a monthly Lakhs Eighty Five thousand One Hundred and Eighty Only) periodicity, reviews Pendency of vigilance cases, towards Gratuity and Rs 91,89,58,191/- (Rupees Ninety One implementation of Complaint handling policy and whistle Crore Eighty Nine Lakhs Fifty Eight Thousand One Hundred blower policy, pending complaints, PVC Meetings, Regular and Ninety One Only) towards Leave Encashment.
58 Annual Report 2017-18 we are with you! 2nd Mega Sports Meet
Bank has conducted Second Mega Sports meet with four events namely, Cricket, Shuttle Badminton, Carroms and Tennikoit. Totally 200 Staff members participated in the events. On the request of our Chairman Shri V. Narasi Reddy, Shri K Lakshmana Rao, GM, SBI, Amaravathi Circle (Ex-Chairman, APGVB) and Shri V Arvind, Chairman, Telangana Grameena Bank, Hyderabad have participated in the programme and encouraged the players. 59 Annual Report 2017-18 we are with you!
Taking pledge on the occasion of Vigilance Awareness Week observed from 30th Oct 4th Nov 2017 Preventive visits of Branches by Vigilance Cell officials, job In all training programmes, workshops and Review Meetings, rotation, submission of Assets & Liabilities Statements by all a session is taken to sensitize all staff members to be vigilant in Officials, and will communicate his / her observations if any. day to day operations. He will also send a quarterly report to State Bank of India, Corporate Centre, Mumbai on the vigilance administration of Board our Bank. The Board of the Bank is constituted by All Branches conduct Preventive Vigilance Meetings once a (a) Chairman of the Bank quarter and officials from Vigilance Department, State Bank of (b) two non-official directors appointed by Government of India, LHO, Hyderabad would visit at least one Branch in a India quarter during Preventive Vigilance Meeting. (c) one nominee director each from Reserve Bank of India and As part of this arrangement, Deputy General Manager NABARD (Vigilance), SBI, LHO, Hyderabad has also organized a (d) two nominee directors from Sponsor Bank Training Programme on 23rd and 24th Jan 2018 for skill (e) two nominee directors from state Government of upgradation of our Bank's officials dealing with Domestic A.P./Telangana. Enquiries as Presenting Officer, Enquiry Officer and With Chairman of the Bank as Chairman of the Board. Investigation officials. Board Meeting Rules stipulate that the Board meets minimum six times a year, at least once in a quarter. Minimum quorum Vigilance Awareness week: for the Board Meeting to transact business is four directors and The Bank has organized Vigilance Awareness week from 30th no meeting was adjourned for want of quorum. October 2017 to 4th November 2017 in Head Office, Regional Offices and all Branches.
Attendance of Directors at Board Meetings during the calendar year 2017
No. of S Name of the No. of WEF Meetings Meetings No Director held attended 1 Shri V. Narasi Reddy 21.07.2014 6 6 2 Non Official Director - Vacant - - - 3 Non Official Director - Vacant - - - 4 Shri M.S.Harishankar 24.06.2016 6 5 Training program conducted for all POs, EOs and Investigation 5 Shri V.S.Gupta 03.08.2015 6 6 officials
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No. of · Both the Govt. of India nominee directors Shri V. S Name of the No. of WEF Meetings Meetings Hanumantha Reddy and Shri C.L Naidu have left the board No Director held attended on completion of their term during the previous year. 6 Shri Kasi Srinivas 16.09.2017 6 5 The Bank places on record the invaluable services rendered by Shri D Somasekhara 01.05.2017 the Directors T.V. Krishna Reddy, Deputy General Manager, Sastry SBI, Hyderabad, Shri D. Somasekhara Sastry, DGM, SBI, Shri T.V. Reddy 28.07.2014 LHO, Hyderabad, Shri K.V. Maruthi Rao, Asst. General 7 Shri S. Ganesan 07.09.2017 6 5 Manager, SBI, Warangal, Shri B. Bharani Kumar, AGM, SBI, B.Bharani Kumar 11.05.2017 Warangal and Smt. K. Sunitha, IAS, Secretary (IF), Finance Shri KV Maruthi Rao 24.10.2014 Department, Government of Andhra Pradesh, A.P. Secretariat. 8 Sri KVV 06.11.2017 6 Nil Satyanarayana Acknowledgements Smt K.Sunitha, IAS 27.06.2015 9 Ms. K.Amrapali,IAS 11.10.2016 6 Nil The Board of Directors of the Bank would like to express their sincere gratitude for the continued trust and patronage received from the customers who have stood with the Bank all *The term of Govt of India nominee directors have completed through. The feedback received from customers by way of during the previous year and proposals were sent to Govt of suggestions / complaints/ interactions during the meetings on India through NABARD/SBI for fresh appointment of the service element have helped the Bank to take corrective directors. New appointments are yet to be made by Govt of measures and new initiatives to improve our efficiency levels. India and presently these two posts are vacant. The Board takes immense pleasure in expressing their During the intervening period of two Board Meetings, as and gratitude for the guidance and cooperation received from the when warranted, the Board has transacted the business by Sponsor Bank, Government of India, both the state means of Circulation of 12 agenda notes during the year, which Governments Telangana and Andhra Pradesh, Reserve Bank were confirmed by the Board in the following Meetings. of India, NABARD, other Financial Institutions and Banks for The Board has undergone the following changes in the their unflinching and valuable support to the Bank from time to composition on account of transfer of officials during the year. time. Further, the Board would like to convey its gratitude to Shri · Shri T.V. Reddy, Deputy General Manager, SBI, Dinesh Khara, MD, State Bank of India, Corporate Centre, Hyderabad, SBI nominee director on the Bank's Board Mumbai, Shri Ravi Nandan Sahay, Chief General Manager, attained superannuation and has been replaced by Shri D. SBI, Corporate Centre, Shri S. Ganesan, General Manager Somasekhara Sastry, DGM, SBI, LHO, Hyderabad. (RRBs), SBI, Corporate Centre and all the team members in During the year, D. Somasekhara Sastry also attained superannuation and in his place Shri Kasi Srinivas, Deputy A&S Department, SBI, CC, Mumbai. They shared their General Manager (FI & MF), SBI, LHO, Hyderabad, has knowledge, their ideas, and numerous tips all of which were been nominated on the Board. extremely useful in taking this Bank forward. The Bank is indebted to these executives for their constant hand holding. · Shri K.V. Maruthi Rao, Asst. General Manager, SBI, Warangal has been replaced by Shri B. Bharani Kumar, We will be failing in our duty if we do not acknowledge the AGM, SBI, Warangal. After merger of SBI and Associate help extended by NABARD and State Bank of India, Local Banks, our Bank, along with other sponsored RRBs, has Head Office, Hyderabad in sparing their Officers to be been brought under direct control of SBI, Corporate Centre, members of the Selection Committees constituted for Mumbai. Shri S. Ganesan, General Manager (RRBs), State promotions. Bank of India, Corporate Centre, Mumbai has been The Board conveys its gratitude to Shri R.Subramanian, nominated as Director on the Board, in place of Shri B. Regional Director, Reserve Bank of India, Hyderabad; Smt. Bharani Kumar. Reeny Ajith, Banking Ombudsman, RBI, Hyderabad for their · Shri K.V.V. Satyanarayana, IRAS, Special Secretary to support. The Board also acknowledges the great support and Government (B&IF), Finance Department, A.P. Secretariat affectionate guidance from Shri Dr. P. Radhakrishnan, Chief has been nominated as Director in place of Smt. K. Sunitha, General Manager, NABARD TSRO and his team of General IAS, Secretary (IF), Finance Department, Government of Managers Shri C. Udaya Bhaskar, Shri P.N. Satya Prasad and Andhra Pradesh, A.P. Secretariat. Dr. Subhash Chandra and Shri K. Suresh Kumar, Chief
61 Annual Report 2017-18 we are with you! Brain Storming Sessions for Business Development & Managerial Skills Organisation has been growing in business volume and complexity of issues has also been increasing with sweeping changes brought in by technology. The complexity is augmented by skewed mix of experienced and inexperienced staff. Our Bank’s top management often brainstorm on crucial issues concerning the Bank. The following four areas which we thought have immense relevance at this juncture have been deliberated upon in the brainstorming session, inviting new ideas and suggestions. a) How to ensure adherence to systems and procedures b) How to strengthen the machinery at HO and ROs to monitor Branches effectively. c) Implementation of Technology – Opportunities and Threats – Our preparedness. d) Identification and grooming of youngsters to shoulder higher responsibility. The Ideas generated in the session have been taken into consideration in our policy framework
62 Annual Report 2017-18 we are with you!
General Manager, NABARD, APRO and his General Manager of the Bank's Financial Year 2017-18 in time. K.S. Raghupathi. The Board also expresses its gratitude to all Public Relations The Board also expresses sincere thanks to all the District Officers, Print and Electronic media for their cooperation in Collectors, Project Directors of DRDA, IKP, DWMA, giving wide publicity for the Bank. The Board also thanks SC/ST/BC Minorities and Housing Corporations of all the the Officers Association, Employees Union and SC/ST/OBC districts in Telangana and Andhra Pradesh where our Bank is Welfare Associations for their constructive role played in operating, for their support and encouragement. overall development of the Bank. The Board would like to gratefully acknowledge the support Words are not adequate to recall the excellent performance, rendered by our Technology Service Providers viz., M/s C- sense of involvement, ownership and dedicated services Edge Technologies, Mumbai, M/s Irix Technologies and M/s rendered by each and every staff member in achieving the National Payments Corporation of India. sustained business growth and profit and surpassing all the Apart from our customers, the support received from the targets set out for the year under MoU with our sponsor bank. Government Departments / Institutions of both Telangana and Amazing work by the individuals is always valued and kept Andhra Pradesh states was immense and augmented our on record. resources. The Board wishes to thank Pollution Control Boards, Sthree Nidhi credit co-op federation ltd, Markfed, For and on behalf of Board of Directors of Industrial Development Corporations, endowments Andhra Pradesh Grameena Vikas Bank departments of both Telangana and A.P States for their patronage. The Board extends its heartfelt gratitude to M/s Rao & Kumar Central Statutory Auditors of the Bank and other Statutory Branch Auditors for their cooperation in completing the Audit (V. Narasi Reddy) Chairman
63 Annual Report 2017-18 we are with you!
Financial Literacy Camps
64 Annual Report 2017-18 we are with you!
Nursery Unit financed by our Shivampet Branch (Sangareddy RO) Members of a satisfied SHG with the Branch Manager, Shivampet Branch
Tata Hitachi Excavator financed by Fort Warangal Branch through AMH WGL
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Performance in Figures
Balance Sheet Profit & Loss A/c Schedules Notes to Accounts
67
Annual Report 2017-18 we are with you!
INDEPENDENT AUDITORS' REPORT Rao & Kumar To Chartered Accountants The Shareholders Andhra Pradesh Grameena Vikas Bank Report on the Financial Statements 1. We have audited the accompanying financial statements of Andhra Pradesh Grameena Vikas Bank (“the Bank”) as at March 31, 2018, which comprises the Balance Sheet as at March 31, 2018, and Profit and Loss Account and the cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information. Incorporated in these financial statements are the returns of: i) The Head Office, 39 Branches audited by us; ii) 555 Branches audited by Other Auditors 2. The branches audited by us and those audited by other auditors have been selected by the Bank in accordance with the guidelines issued to the Bank by the National Bank for Agriculture and Rural Development (NABARD). Also incorporated in the Balance Sheet and the Profit and Loss Account are the returns from 174 branches (including other accounting units) which have not been subjected to audit. These unaudited branches account for 24.89% of advances, 23.31% of deposits, and 18.19% of interest income and 16.29%of interest expenses. Management's Responsibility for the Financial Statements 3 The Bank's Board of Directors is responsible for preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of Bank in accordance with the applicable provisions of Regional Rural Bank Act, 1976, Banking Regulations Act,1949, applicable guidelines of Reserve Bank of India (RBI) / NABARD accounting principles generally accepted in India, including the Accounting Standards issued by Institute of Chartered Accountants of India(ICAI). This responsibility of management includes the design, implementation and maintenance of internal controls and risk management systems relevant to the preparation of the financial statements that are free from material misstatement, whether due to fraud or error. In making those risk assessments, the management has implemented such internal controls that are relevant to the preparation of the financial statements and designed procedures that are appropriate in the circumstances so that the internal control with regard to all the activities of the Bank is effective. Auditor's Responsibility 4. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. 5. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Bank's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 6 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
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Opinion 7 In our opinion as shown by books of the Bank and to the best of our information and according to the explanations given to us: i) The Balance Sheet, read with the significant accounting policies and the notes thereon is a full and fair Balance Sheet containing all the necessary particulars, is properly drawn up so as to exhibit a true and fair view of state of affairs of the Bank as at 31st March 2018 in conformity with accounting principles generally accepted in India; ii) The Profit and Loss Account, read with the significant accounting policies and the notes thereon shows a true balance of profit in conformity with accounting principles generally accepted in India, for the year covered by the account; and iii) The Cash Flow Statement gives a true and fair view of the cash flows for the year ended on that date Report on Other Legal and Regulatory Requirements 8 The Balance Sheet and the Profit and Loss Account have been drawn up in Forms “A” and “B” respectively of the Third Schedule to the Banking Regulation Act, 1949. 9 Subject to the limitations of the audit indicated in paragraph 1 to 5 above and subject to the limitations of disclosure required therein, we report that: a) We have obtained all the information and explanations which to the best of our knowledge and belief, were necessary for the purposes of our audit and have found them to be satisfactory. b) The transactions of the Bank, which have come to our notice, have been within the powers of the Bank. c) The returns received from the offices and branches of the Bank have been found adequate for the purposes of our audit. d) The Balance Sheet and the Profit and Loss Account dealt with by this Report are in agreement with the books of account and the Returns. e) In our opinion, proper books of account as required by Law have been kept by the Bank, so far as appears from our examination of those books f) The Reports on the financial statements of the Branches audited by the Branch Auditors have been dealt with in preparing our Report in the manner considered necessary by us. 10 In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement comply with the applicable accounting standards.
For RAO & KUMAR Chartered Accountants Place: Hyderabad FRN: 003089S Date: 02.05.2018 CA C M Ravi Prasad Partner MNO: 211322
70 Andhra Pradesh Grameena Vikas Bank Head Office: Warangal st Balance Sheet As At 31 March 2018 (Rs in '000s) Particulars Sch. As on 31.03.2018 As on 31.03.2017 CAPITAL AND LIABILITIES Capital 1 94 08 50 94 08 50 Reserves & Surplus 2 2158 73 84 1655 72 37 Deposits 3 14333 62 93 12818 57 62 Borrowings 4 8041 20 59 5620 84 13 Other Liabilities & Provisions 5 1037 56 02 857 92 53 Total 25665 21 88 21047 15 15 ASSETS Cash and balances with RBI 6 735 95 73 730 55 43 Balances with Banks and Money at Call & Short Notice 7 5540 64 14 4057 12 69 Investments 8 5894 10 81 4433 07 29 Advances 9 12349 08 13 10926 36 75 Fixed Assets 10 57 28 44 57 17 70 Other Assets 11 1088 14 63 842 85 29 Total 25665 21 88 21047 15 15 Contingent Liabilities 12 32 06 98 33 37 92
As per our report of even date For Rao & Kumar Chartered Accountants For Andhra Pradesh Grameena Vikas Bank Firm Registration No: 003089S
(CA. C.M.Ravi Prasad ) (T.V.Krishna Reddy) (V.Narasi Reddy) Partner General Manager-II Chairman Membership No : 211322
(Y.Rambabu) (Kasi Srinivas) (S.Ganesan) Director Director Director
(V.S.Gupta) (Smt.K.Amrapali, IAS) (K.V.V.Satyanarayana, IRAS) Director Director Director
Place: Ramachandrapuram, Medak Dist. Date: 2nd May 2018 Annual Report 2017-18 we are with you!
Andhra Pradesh Grameena Vikas Bank Head Office: Warangal st Profit & Loss for the year ended 31 March 2018 (Rs in '000) Particulars Sch. 2017-18 2016-17
1 Interest Earned 13 2026 96 88 1760 87 26
a. Interest/Discount on Advances/bills 1485 09 70 1309 92 51
b. Interest on Investments 365 86 05 250 49 50
c. Interest on Balances with RBI and Other Inter Bank Funds 0 0
d. Interest on TDRs with Banks 176 01 13 200 45 25
2 Other Income 14 297 48 95 197 19 14
a. Commission, Exchange and Brokerage 220 06 99 141 14 99
b. Miscellaneous Income 77 41 96 56 04 15
3 TOTAL 2324 45 83 1958 06 40
4 Interest Expended 15 1178 77 93 1108 93 87
5 Operating Expenses (a + b) 16 317 88 45 297 46 64
a. Employees Costs 207 14 06 199 66 43
b. Other Operating Expenses 110 74 39 97 80 21
6 Total Expenditure (excluding provisions and Contingencies) ( 4+5) 1496 66 38 1406 40 51
7 Operating Profit before provisions and Contingencies (3-6) 827 79 45 551 65 89
8 Provisions (other than tax) and Contingencies 77 29 26 28 96 06
9 Profit from Ordinary Activities before Tax (7-8) 750 50 19 522 69 83
10 Tax Expense
a. Provision for Taxation-Current Year (252 03 80) (169 06 00)
b. Deferred Tax Asset 3 88 02 (1 45 78)
c. Earlier Years Adjustments (Excess) 67 05 (18 93)
11 Net profit for the period from Ordinary Activities after Tax 503 01 46 351 99 12
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(Rs in '000s) Particulars Sch. 2017-18 2016-17
APPROPRIATIONS Net Profit for the period 503 01 46 351 99 12 Brought forward Profit 1305 07 18 1027 32 54 Transfer to the Statutory Reserves 100 60 29 70 39 82 Special Reserve u/s 36(1)(viii) of IT Act, 1961 6 53 06 3 84 66 Profit Carried Over to Balance Sheet 1700 95 29 1305 07 18 Summary of Significant Accounting Policies 17 Disclosures and Notes to Accounts 18
As per our report of even date For Rao & Kumar Chartered Accountants For Andhra Pradesh Grameena Vikas Bank Firm Registration No: 003089S
(CA. C.M.Ravi Prasad ) (T.V.Krishna Reddy) (V.Narasi Reddy) Partner General Manager-II Chairman Membership No : 211322
(Y.Rambabu) (Kasi Srinivas) (S.Ganesan) Director Director Director
(V.S.Gupta) (Smt.K.Amrapali, IAS) (K.V.V.Satyanarayana, IRAS) Director Director Director
Place: Ramachandrapuram, Medak Dist. Date: 2nd May 2018
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018
SCHEDULE – 1 CAPITAL (Rs in '000’s) Particulars As on 31.03.2018 As on 31.03.2017 Authorised Capital 2000,00,00 2000,00,00 (200,00,00,000 Equity Shares of Rs.10/-each)
Issued Capital 94,08,50 94,08,50 (9,40,85,049 Equity Shares of Rs.10/-each)
Subscribed Capital 94,08,50 94,08,50 (9,40,85,049 Equity Shares of Rs.10/-each)
Called up Capital 94,08,50 94,08,50 (9,40,85,049 Equity Shares of Rs.10/-each)
Less: Calls Unpaid NIL NIL
Add: Forfeited Shares NIL Nil
TOTAL 94,08,50 94,08,50
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018
SCHEDULE – 2 - RESERVES AND SURPLUS (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017 I. Statutory Reserve Opening Balance 332 47 85 262 08 03 Additions during the Year 100 60 29 70 39 82 Deductions during the Year Nil Nil TOTAL 433 08 14 332 47 85 II. Capital Reserve Opening Balance 1 20 1 20 Additions during the Year Nil Nil Deductions during the Year Nil Nil TOTAL 1 20 1 20 III. Share Premium Opening Balance Nil Nil Additions during the Year Nil Nil Deductions during the Year Nil Nil TOTAL Nil Nil IV. Special Reserve u/s 36(1)(viii) of Income Tax Act,1961 Opening Balance 3 84 66 Nil Additions during the Year 6 53 06 3 84 66 Deductions during the Year Nil Nil TOTAL 10 37 72 3 84 66 V. Revenue and other Reserve Opening Balance 14 31 49 14 31 49 Additions during the Year Nil Nil Deductions during the Year Nil Nil TOTAL 14 31 49 14 31 49 Balance in Profit and Loss Account 1700 95 29 1305 07 18 TOTAL 2158 73 84 1655 72 37
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018
SCHEDULE – 3 - DEPOSITS (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017
A. I. Demand Deposits
i) From Banks Nil Nil
ii) From Others 121 79 73 126 87 53
II. Savings Bank Deposits 5920 14 04 5134 62 68
III Term Deposits
i) From Banks Nil Nil
ii) From Others 8291 69 16 7557 07 41
TOTAL 14333 62 93 12818 57 62
B. i) Deposits of Branches in India 14333 62 93 12818 57 62
ii) Deposits of Branches Out Side India Nil Nil
TOTAL 14333 62 93 12818 57 62
SCHEDULE – 4 - BORROWINGS (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017 I. Borrowings in India i) Reserve Bank of India Nil Nil ii) Other Banks 2604 41 11 1894 60 79 iii) Other Institutions (NABARD,NHB & MUDRA) a) NABARD 5299 46 23 3684 71 42 b) NHB 97 33 25 41 51 92 c) MUDRA 40 00 00 0 II. Borrowings Outside India Nil Nil TOTAL 8041 20 59 5620 84 13
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018
SCHEDULE – 5 OTHER LIABILITIES AND PROVISIONS (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017 I) Bills payable/Bankers Cheque 112 92 85 86 85 97 II) Inter Office Adjustments (Net) 15 85 19 3 90 01 III) Interest Accrued on Deposits 481 47 64 480 10 46 IV) General Provisions: a) Provision on Standard Assets 40 60 21 34 26 25 b) Provision on Rural Advances 10 67 36 10 67 36 c) Provision on Frauds 80 40 91 28 d) Audit Fee Provisions 1 00 00 40 00 e) Income Tax Provision 252 03 80 169 06 00 f) Bonus Provision 39 34 38 50 g) Wage Revision provision 8 55 00 0 h) Depreciation on SLR Securities under AFS category 3 10 55 0 V) Interest payables 57 57 61 42 45 11 VI) TDS on Bank Term Deposits 8 53 09 8 43 50 VII) Deferred Tax 0 2 68 67 VIII) Other Liabilities 44 02 98 17 79 42 TOTAL 1037 56 02 857 92 53
SCHEDULE – 6 - CASH AND BALANCE WITH RESERVE BANK OF INDIA (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017
I. Cash in Hand (Including Foreign Currency Notes) 168 46 82 185 07 22
II. Balances With Reserve Bank of India i) In Current Account 567 48 91 545 48 21
ii) In Other Account NIL NIL
TOTAL 735 95 73 730 55 43
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018 SCHEDULE – 7 - BALANCES WITH BANKS AND MONEY AT CALL & SHORT NOTICE (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017 I. In India i. Balance with Banks a) In Current Accounts 7 38 05 3 75 05 b) In Other Deposit Accounts (TDRs) 5533 26 09 4053 37 64 ii. Money at Call & Short Notice a) With Banks Nil Nil b) With Other Institutions Nil Nil TOTAL 5540 64 14 4057 12 69 II. Outside India a) In Current Accounts Nil Nil b) In Other Deposit Accounts Nil Nil c) Money at Call & Short notice Nil Nil TOTAL 0 0 GRAND TOTAL (I&II) 5540 64 14 4057 12 69
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Andhra Pradesh Grameena Vikas Bank
Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018
SCHEDULE – 8 - INVESTMENTS (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017 I Investment in India i) Government Securities 5763 85 82 4343 24 77 ii) Other Approved Securities Nil Nil iii) Shares Nil Nil iv) Debentures and Bonds Nil Nil v) Subsidaries and /or joint Ventures Nil Nil vi) Investment in Equity shares of National Payment Corporation of India (Long Term) 24 99 24 99 vii) Others 130 00 00 89 57 53 TOTAL 5894 10 81 4433 07 29 II Investments Out Side India i) Government Securities Nil Nil (Including Local Authorities) ii) Subsidiaries and/or Joint Ventures Nil Nil iii) Other Investments (To Be Specified) Nil Nil TOTAL 0 0 GRAND TOTAL (I&II) 5894 10 81 4433 07 29
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018 SCHEDULE – 9 - ADVANCES (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017
A. 1. Bills Purchased and Discounted Nil Nil
2. Cash Credits, Overdrafts and Loans Repayable on Demand 9538 01 01 8304 24 21
3. Term Loans 2811 07 12 2622 12 54
TOTAL (A) 12349 08 13 10926 36 75
B.1. Secured by Tangible Assets 12244 39 54 10891 49 77
2. Covered by Bank / Government Guarantees Nil Nil
3. Unsecured 104 68 59 34 86 98
TOTAL (B) 12349 08 13 10926 36 75
C.I. Advances in India
1. Priority Sector 10680 69 31 9573 43 61
2. Public Sector Nil Nil
3. Banks Nil Nil
4. Others 1668 38 82 1352 93 14
TOTAL (C.I) 12349 08 13 10926 36 75
C.II. Advances Outside India
1. Due from banks Nil Nil
2. Due from Others Nil Nil
TOTAL (C.II) 0 0
GRAND TOTAL (C.I+C.II) 12349 08 13 10926 36 75
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018
SCHEDULE – 10 - FIXED ASSETS (Rs in '000) Particulars As on 31.03.2018 As on 31.03.2017 I. Land At cost as on the 31st March of the Preceding Year 9 57 9 57 Additions During the Year 0 0 Deductions During the Year 0 0 TOTAL 9 57 9 57 I. Buildings At cost as on the 31st March of the Preceding Year 14 00 14 00 Additions During the Year 1 43 28 0 Deductions During the Year 0 0 Depreciation during the year 2 24 0 TOTAL 1 55 04 14 00 II. Other Fixed Assets (including Furniture and Fixtures) At cost as on the 31st March of the Preceding Year 112 46 63 103 00 38 Additions During the Year 8 02 47 9 51 00 Deletions During the Year 9 33 4 75 Depreciation as on 31st March of the preceding year 61 03 27 51 46 42 Depreciation during the year 9 28 23 9 56 85 Depreciation on deletions 3 31 0 TOTAL 50 11 58 51 43 36 III. Capital Work in Progress At cost as on the 31st March of the Preceding Year 5 50 77 3 86 03 Additions During the Year 1 48 1 64 74 Deletions During the Year 0 0 TOTAL 5 52 25 5 50 77 TOTAL (I+II+III) 57 28 44 57 17 70
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018 SCHEDULE – 11 - OTHER ASSETS (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017 1. Inter Office Adjustments (Net) 0 0 2. Interest Accrued 144 83 68 186 53 11 3. Advance Tax 230 00 00 145 00 00 4. Tax Deducted at Source 14 98 66 5 28 95 5. Stationery 50 10 36 83 6. Telephone deposit 3 98 3 85 7. Suspense 0 0 8. Subvention/Int. Incentive receivable from NABARD 621 62 00 452 37 08 9. Prepaid Expenses - Insurance 2 91 50 94 59 10. Income Tax paid against Disputed Demand 37 22 31 34 74 65 11. Deferred Tax 1 19 35 0 12. Others 34 83 05 17 56 23 TOTAL 1088 14 63 842 85 29
SCHEDULE – 12 - CONTINGENT LIABILITIES (Rs in '000s) Particulars As at 31.03.2018 As at 31.03.2017 Claims against the Banks not acknowledged as debts 18 45 00 18 14 00 Liabilities for partly paid Investments Nil Nil Liabilities on account of outstanding forward exchange contracts Nil Nil Guarantees Given on behalf of Constituents a) In India 11 16 55 10 58 91 b) Out Side India Nil Nil Acceptances, Endorsements and other Obligations Nil Nil "Other items for which the Bank is contingetly liable (DEAF Account)" 1 34 98 1 33 66 (Unclaimed Bankers Cheques treated as income) 1 10 45 3 31 35 TOTAL 32 06 98 33 37 92
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018
SCHEDULE – 13 - INTEREST EARNED (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017
Interest/ Discount on Advances/Bills 1485 09 70 13099251 Interset on Investments 365 86 05 250 49 50 Interest on Balances with RBI and Other Inter Bank Funds Nil Nil Others 176 01 13 200 45 25 TOTAL 2026 96 88 1760 87 26
SCHEDULE – 14 - OTHER INCOME (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017 Commission, Exchange and Brokerage 220 06 99 141 14 99 Profit on Sale of Investment 71 41 12 49 60 43 Profit on Revaluation of Investments Nil Nil Profit on Sale of Lands, Buildings and Other Assets Nil Nil Profit on Exchange Transactions Nil Nil Income Earned by way of Dividend etc, from subsidiaries/ Companies and /Or Joint Ventures Abroad /In India Nil Nil Miscellaneous Income 6 00 84 6 43 72 TOTAL 297 48 95 197 19 14
SCHEDULE – 15 - INTEREST EXPENDED (Rs in '000s) Particulars As on 31.03.2018 AsYear on 31.03.2017Ended 31.03.2017 Interest on Deposits 841 49 39 (Previous796 Year) 31 82 Interest on Reserve bank of India/Inter Bank Borrowings 337 28 54 312 62 05 Others Nil Nil TOTAL 1178 77 93 1108 93 87
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Andhra Pradesh Grameena Vikas Bank
Head Office: Warangal Schedules forming Part of Balance Sheet As on 31st March 2018
SCHEDULE – 16 - OPERATING EXPENSES (Rs in '000s) Particulars As on 31.03.2018 As on 31.03.2017 Salary Payments and Provisions to Employees 207 14 06 199 66 43 Gratuity Contribution Fund 0 4 39 06 Leave Encashment Fund 9 87 03 1 68 97 Medical Expenses 5 42 68 6 53 71 Leave Fare Concession 12 67 7 49 Rent, Taxes, Lighting and Fuel 15 77 93 17 55 53 Printing and Stationery 5 78 92 2 82 24 Advertisement and Publicity 6 57 8 47 Director's Fee, Allowances and Expenses 0 12 Depreciation on Banks Property 9 30 46 9 56 85 Auditors Fee and Expenses 1 22 33 39 74 Legal Charges 25 60 15 24 Telephone Charges 1 44 68 1 39 02 Repairs and Maintenance 20 25 21 19 Insurance 13 75 39 11 86 88 Travelling and Halting expenses 6 41 74 4 97 59 AMC for Software and Hardware 15 79 42 12 61 76 Books and Periodicals 80 31 84 78 Computerization 51 49 58 65 Vehicle and Fuel 1 90 47 3 43 50 Entertainment 79 94 75 83 Other Expenses (Sundries) 21 26 51 17 83 59 TOTAL 317 88 45 297 46 64
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal SCHEDULE – 17 - SIGNIFICANT ACCOUNTING POLICIES 1. Basis of Preparation: The Bank's financial statements are prepared under the historical cost convention, on the accrual basis of accounting on going concern basis, unless otherwise stated and conform in all material aspects to Generally Accepted Accounting Principles (GAAP) in India, which comprise applicable statutory provisions, regulatory norms / guidelines prescribed by the National Bank for Agriculture and Rural Development (NABARD) / Reserve Bank Of India (RBI), Banking Regulation Act 1949, Regional Rural Bank Act, 1976 and amendments thereto and Accounting Standards issued by the Institute of Chartered Accountants of India (ICAI), and the practices prevalent in the banking industry in India. 2. Use of estimates: The preparation of financial statements requires the management to make estimates and assumptions considered in the reported amount of assets and liabilities (including contingent liabilities) as on the date of financial statements and the reported income and expenses during the reporting period. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable and are based upon management's evaluation of the relevant facts and circumstances as of the date of financial statements. Future results could differ from to these estimates and the differences between the actual results and the estimates are recognised in the period in which the result are known / materialised. 3. Revenue Recognition: a) Income and Expenditure are accounted on accrual basis, except otherwise stated. b) Interest income is recognised in the Profit and Loss Account as it accrues except, income from Non Performing Assets (NPAs), comprising of advances and investments which is recognised upon realisation, as per the prudential norms prescribed by the RBI or other regulatory authorities. c) Profit / loss on sale of investments is recognised in the Profit and Loss Account. d) Income (other than interest) on interest bearing investments in "Held to Maturity (HTM)" category acquired at a discount to the face value, is recognised only at the time of sale / redemption. e) Commission & Exchange and Locker rent have been recognized on realization basis. f) Interest on overdue term deposits is accounted for on renewal. g) In case of suit filed accounts, legal and other expenses incurred are charged to Profit and Loss Account and at the time of recovery of such expenses is accounted as income. 4. Investments: The transactions in Government Securities are recorded on “Settlement Date”. Investments other than Government Securities are recorded on “Trade Date”. a) Investments are classified into three categories viz., Held to Maturity (HTM), Available for Sale (AFS) and Held for Trading (HFT) as per RBI guidelines.
Investments that the Bank intends to hold till maturity are classified as Held to Maturity (HTM).
Investments that are held principally for resale within 90 days from the date of purchase are classified as Held for Trading (HFT)
Investments, which are not classified in the above two categories, are classified as Available for Sale (AFS). An investment is classified as HTM / HFT / AFS at the time of its purchase and subsequent shifting amongst categories is done in conformity with regulatory guidelines.
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However, for disclosure in Balance Sheet these are classified as under - Government Securities, Other Approved Securities and Others. b) The Securities in each classification are valued in accordance with RBI guidelines as detailed hereunder:
In determining the acquisition cost of an investment:
Brokerage or Commission received on subscriptions is reduced from the cost.
Broking period interest paid / received on debt instruments is treated as interest expense / income and is excluded from cost or sale consideration.
Cost is determined on the weighted average cost method for investments under AFS and HFT category and FIFO basis (First in First out) for investments under HTM category
Transfer of securities from HFT / AFS category to HTM category is carried out at the lower of acquisition cost / book value / market value on the date of transfer. The depreciation, if any, on such transfer is fully provided for. However, transfer of securities from HTM category to AFS category is carried out on at acquisition price / book value. After transfer, these securities are immediately re-valued and resultant depreciation, if any, is provided
Investments under Held to Maturity category are carried at acquisition cost unless it is more than the face value, in which case the premium is amortised over the period of remaining maturity on constant yield basis. Such amortisation of premium is adjusted against income under the head “Interest on Investments”.
Investments in equity shares of other companies are valued at historical cost. A provision is made for diminution, other than temporary, for each investment individually.
Investments under AFS and HFT category are individually re-valued at market price or fair value determined as per regulatory guidelines, and only the net depreciation of each group for each category (viz., (i) Government securities (ii) Other Approved Securities) is provided for and net appreciation is ignored. On provision for depreciation, the book value of individual security remains unchanged after marking to market.
Investments are classified as Performing and Non Peforming, based on the guidelines issued by the RBI. Investments of domestic offices become non performing where:
Interest or instalment (including maturity proceeds) is due and remains unpaid for more than 90 days.
In the case of equity shares, in the event the investment in the shares of any company is valued at Rs. 1/- per company on account of the non availability of the latest balance sheet, those equity shares will be reckoned as NPI. 5. Loans or Advances and Provisions thereon: Loans and advances are classified as performing and non-performing, based on the guidelines/ directives issued by the RBI. Loan assets become Non Performing Asset (NPA) where:
In respect of agriculture advances: i. For short duration crops, where the instalment of principal or interest remains overdue for two crop seasons and ii. For long duration crops, where the principal or interest remains overdue for one crop season.
In respect of Non Agriculture advances: i. In respect of term loans, interest and / or instalment of principal remains overdue for a period of more than 90 days. ii. In respect of Overdraft or Cash Credit Advances, the account remains “out of order”, i.e. if the outstanding balance exceeds the sanctioned limit or drawing power continuously for a period 90 days, or if there are no credits continuously for 90 days as on the date of balance sheet, or if the credits are not adequate to cover the interest debited during the same period.
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Provisions are made for NPAs as per the extant guidelines/directives prescribed by the RBI: a) All advances have been classified under four categories i.e., Standard Assets, Sub-standard Assets, Doubtful Assets and Loss Assets. b) Provisions on Advances are made as under: I Standard Assets: General Provision for Standard Assets at the following rates: Direct Advances to Agriculture and SME sectors at 0.25% Commercial Real Estate sector at 1% All other advances not included in (1) & (2) above at 0.40% II Sub-Standard Assets: A loan asset that has remained non performing for a period less than or equal to 12 months is a Sub Standard Asset General Provision of 15% on the total outstanding Additional Provision of 10% for exposures which are unsecured ab-intio (i.e. where realisable value of security is not more than 10% ab-initio). III Doubtful Assets: A loan asset that has remained in the substandard category for of 12 months is Doubtful Asset
Secured Portion Up to One year 25% One to three years 40% More than three years 100% Unsecured Portion 100%
IV Loss Assets: A loan asset where Loss has been identified but the amount has not been fully written off is a Loss Asset. 100% Provision on outstanding Advances.
Advances are net of specific loan loss provisions, unrealised interest, ECGC claims received and Inter Bank Participation Certificates.
For Restructured / Rescheduled assets, provisions are made in accordance with the extant guidelines issued by the RBI.
In the case of loan accounts classified as NPAs, an account may be reclassified as a performing asset if it confirms to the guidelines prescribed by the regulators.
Amounts recovered against debts written off in earlier years are recognised as revenue in the year of recovery.
In addition to the specific provision on NPAs, general provisions are also made for Standard Assets as per extant RBI guidelines. These provisions are reflected in Schedule 5 of the Balance Sheet under the head "Other Liabilities and Provisions - Other Provisions" and are not considered for arriving at the net NPAs.
Interest realized on NPAs are taken in to income account provided the credits in the accounts towards interest are not out of fresh/additional credit facilities sanctioned to the borrower concerned.
Appropriation of recoveries in NPAs i.e. towards principal or interest due as per the Bank's extant instructions is done in accordance with the following priority.
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a. Charges b. Unrealized Interest/Interest c. Principal 6. Floating Provisions: The bank has a policy for creation and utilisation of floating provisions separately for advances, investments and general purpose. The quantum of floating provisions to be created is assessed at the end of each financial year. 7. Fixed Assets, Depreciation and Amortisation:
Fixed Assets are carried at historical cost less accumulated depreciation/amortisation.
Cost includes cost of purchase and all expenditure directly attributable to or incur in connection with acquiring the said asset before it is put to use. Subsequent expenditure incurred on the assets put to use are capitalised only when it increases the future benefits from such assets or their functioning capability. Depreciation / amortisation is provided on straight line method as per the rates stated below. Description of Fixed Asset Depreciation / amortization rates Buildings 1.6667% Furniture & Fixtures other than Electrical Fittings and Fixtures 10% Electrical Fittings with 3 years life 33.33% Electrical Fittings with 5 years life 20% Safe Deposit Lockers, Fire proof data safe 5% Computer systems & ATMs 33.33% Computer software which does not form an integral part of computer hardware and cost of software development 100% Motor vehicles 10%
In respect of assets acquired during the year (for domestic operations), depreciation is charged on proportionate basis for the number of days the assets have been put to use during the year.
Assets costing less than 5,000 each are charged off in the year of purchase.
8. Impairment of Assets: Fixed assets are reviewed for impairment whenever events or changes in circumstances warrant that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future Net Discounted Cash Flows expected to be generated the asset. If such assets are impaired, the impairment to be recognised is measured by the amount which the carrying amount of the asset exceeds the fair value of the asset. 9. Employee Benefits: a. Short Term Employee Benefits: The undiscounted amount of short - term employee benefits, such as medical benefits etc., which are expected to be paid for the services rendered by employees, are recognized during the period when the employee renders the service.
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b. Long Term Employee Benefits i. Defined Benefit Plans: a. Gratuity: For all the eligible employees, the Bank provides for Gratuity liability based on actuarial valuation. The Bank makes periodic contributions to a fund administered by Trustees based on an independent external actuarial valuation carried out annually. b. Leave Encashment: For all the employees who have completed five years of service, the Bank provides for Leave Encashment liability based on actuarial valuation and contributes to SBI Life Insurance Company Limited on annual basis. The cost of providing defined benefits is determined using the projected unit credit method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains/losses are immediately recognised in the Profit and Loss Account and are not deferred. ii. Defined Contribution Plans such as Provident Fund are recognized as an expense and charged to the Profit & Loss Account on accrual basis. 10. Income Tax Expense: Income Tax expense is the aggregate amount of current tax and deferred tax expense incurred by the Bank. Current taxes expense and deferred tax expense are determined in accordance with the provisions of the Income Tax Act, 1961 and as per the Accounting standard 22 - Accounting for Taxes on Income respectively and tax laws prevailing in India. Deferred tax adjustments comprise of changes in the deferred tax assets or liabilities during the period.
Deferred tax assets and liabilities are recognised by considering the impact of the timing differences between taxable income and accounting income for the current year, and carry forward losses. Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted at the Balance Sheet date. The impact of changes in Deferred tax assets and liabilities is recognised in the Profit and Loss Account. Deferred tax assets are recognised and reassessed at each reporting date, based on management's judgement as to whether their realisation is considered as reasonably / virtually certain. 11. Contingent Liabilities & provisions: In conformity with AS - 29 "Provisions, Contingent Liabilities and Contingent Assets", issued by ICAI, the bank recognises the provisions only when it has a present obligation as a result of a past event and would result in a probable outflow of resources embodying economic benefits will be required to settle the obligation, and when a reliable estimate of the amount of the obligation can be made. No provision is recognised for: I. Any possible obligation that arises from past events and existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the bank. II. Any present obligation that arises from past events but is not recognised because a. It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation or b. A reliable estimate of the amount of obligation cannot be made. Such obligation are recorded as Contingent Liabilities. These are assessed at regular intervals and only that part of the obligation for which an outflow of resources embodying economic benefits is probable, is provided for, except in the extremely rare circumstances where no reliable estimate can be made. III. Contingent Assets are not recognised in the financial statements. 12. Special Reserves: Revenue and other Reserve include Special Reserve created under Section 36(i)(viii) of the Income Tax Act, 1961.
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Andhra Pradesh Grameena Vikas Bank Head Office: Warangal SCHEDULE – 18 DISCLOSURES & NOTES TO ACCOUNTS I. Disclosures as per norms for RRBs 1. Capital Sl.No Particulars Current year (%) Mar 2018 Previous year (%) Mar 2017 i) CRAR(%) 15.59 14.05 ii) CRAR – Tier I Capital (%) 15.24 13.70 iii) CRAR – Tier II Capital (%) 0.35 0.35 iv) Percentage of Shareholding of the : A Government of India 50 50 B Government of Andhra Pradesh 15 15 C State Bank of India (Sponsor Bank) 35 35
2. Investments (Rs in '000s) S.No Particulars Current year Mar 2018 Previous year Mar 2018 1 Value of Investments i) Gross value of Investments 5894 10 81 4433 07 29 ii) Provisions for Diminution 3 10 55 0 iii) Net value of Investments 5891 00 26 4433 07 29 2 Movement of provisions held towards depreciation on investments i) Opening Balance Nil Nil ii) Add: Provisions made during the year 3 10 55 Nil iii) Less: Write off / Write back of excess provisions during the year Nil Nil iv) Closing Balance 3 10 55 Nil
The Bank has invested a sum of Rs.24,99,200/- in National Payments Corporation of India (NPCI), a company promoted by ten banks under the guidance of Indian Bank's Association.
3. Repo Transactions (Rs in '000s) Minimum Maximum Daily Average As on st Item outstanding outstanding outstanding 31 during the during the during the March, year year year 2018
Securities Sold under Repos Nil Nil Nil Nil
Securities purchased under Nil Nil Nil Nil Reverse Repos
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4. Non-SLR Investment Portfolio i) Issuer composition of Non SLR Investments (Rs in '000s) S. No Issuer Amount Extent of Extent of Extent of Extent of Private below investment unrated unlisted placement grade securities securities securities 1 2 3 4 5 6 7 i) PSUs NIL NIL NIL NIL NIL ii) FIs NIL NIL NIL NIL NIL iii) Banks NIL NIL NIL NIL NIL iv) Private NIL NIL NIL NIL NIL Corporates v) Others (MF) & Equity shares of NPCI 1302499 NIL NIL NIL NIL vi) Provisions held towards NIL NIL NIL NIL NIL depreciation Total 1302499 NIL NIL NIL NIL
(ii) Non-Performing Non-SLR Investments (Rs in '000s) Particulars Amount Opening balance NIL Additions during the year since 1st April NIL Reductions during the above period NIL Closing Balance NIL Total provisions held NIL 5. Asset Quality I. Non-Performing Assets (Rs in '000s) No. Particulars Current year (2017-18) Previous year (2016-17) i) Net NPAs to Net Advances (%) 0.20 0.72 ii Movement of NPAs (Gross) (a) Opening balance 209,73,96 251,99,83 (b) Additions during the year 305,26,38 123,58,98 (c) Reductions during the year 319,36,10 165,84,85 (d) Closing balance 195,64,24 209,73,96 iii Movement of Net NPAs (a) Opening balance 87,57,54 147,66,71 (b) Additions during the year 23,37,23 0 (c) Reductions during the year 82,91,96 60,09,17 (d) Closing balance 28,02,81 87,57,54 iv Movement of provisions for NPAs (Excluding provisions on standard assets) (a) Opening balance 122,16,42 104,33,12 (b) Provisions made during the year 59,40,63 24,49,15 (c) Write-off / Write-back of excess provisions 13,95,61 6,65,85 (d) Closing balance 167,61,44 122,16,42
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ii. Details of Loan Assets subject to Restructuring (Rs in '000s) S.No Particulars Current year Previous year i Total amount of loan assets subject to restructuring, rescheduling, renegotiation Nil Nil ii The amount of Standard assets subjected to restructuring, rescheduling, renegotiation Nil Nil iii The amount of Sub-Standard assets subjected to restructuring, rescheduling, renegotiation Nil Nil iv The amount of Doubtful assets subjected to restructuring, rescheduling, renegotiation Nil Nil (i) = (ii) + (iii) + (iv) Nil Nil
II. Details of financial assets sold to Securitization (SC) / Reconstruction Company (RC) for Assets Reconstruction (Rs in '000s) S.No Particulars Current year Previous year i No. of accounts Nil Nil ii Aggregate value (net of provisions) of accounts sold to SC/RC Nil Nil iii Aggregate consideration Nil Nil iv Additional consideration realized in respect of accounts transferred in earlier years Nil Nil v Aggregate gain / loss over net book value Nil Nil
III. Details on non-performing financial assets purchased / sold A. Details of non-performing financial assets purchased: (Rs in '000s) S.No Particulars Current year Previous Year 1 (a) No. of accounts / purchased during the year Nil Nil (b) Aggregate outstanding Nil Nil 2 (a) Of these, number of account restructured during the year Nil Nil (b) Aggregate outstanding Nil Nil
B. Details of non-performing financial assets sold : (Rs in '000s) S.No. Particulars Current year Previous year
1 No. of accounts sold Nil Nil
2 Aggregate outstanding Nil Nil
3 Aggregate consideration received Nil Nil
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IV. Provisions on Standard Assets (Rs in '000s) S.No. Particulars Current year Previous year 1 Provisions towards Standard Assets 406021 342625
6. Business Ratios
S.No Particulars Current year Previous year i Interest income as a percentage to Working Funds 9.01 9.11 ii Non-Interest income as a percentage to Working Funds 1.32 1.02 iii Operating profit as a percentage to Working Funds (Before provisions) 3.68 2.85 iv Returns on Assets (%) 2.24 1.82 v Business per Employee (Dep + Adv)(Rs'000) 90666 84520 vi Net profit per Employee (Rs'000) 1592 1181
7. Asset Liability Management – Maturity pattern of certain terms of Assets and Liabilities (Rs in '000s) Over 3 Over 6 Over 1 Over 3 29 days 1 to 14 15 to 28 months months year year Over 5 Particulars to 3 Total days days and and and and years months upto 6 upto 1 upto 3 upto 5 months year years years
Deposits 9345708 3136902 12923598 39960926 21635305 1253652 2745549 52334653 143336293
Advances 7288481 3178319 12691951 15383203 2820353 16697381 11381993 54175000 123616681
Investments & STDRs 1300000 0 408509 38003089 18079793 988736 2432313 53061250 114273690
Borrowings 0 0 0 10463257 285349 21585320 10397948 37680185 80412059
Foreign Currency Assets NIL NIL NIL NIL NIL NIL NIL NIL NIL Foreign Currency NIL NIL NIL NIL NIL NIL NIL NIL NIL Liabilities
93 Annual Report 2017-18 we are with you!
8. Exposures – Exposure to Real Estate Sector (Rs in '000s) S.No Particulars Current year Previous year a Direct exposure i Residential Mortgages above Rs. 20.00 lakhs lending fully secured 468 96 21 131 60 32 by mortgages on residential property that is or will be occupied by the borrower or that is rented (individual housing loan upto Rs. 20 lakh may be shown separately) Up to Rs. 20.00 lakhs 716 29 27 641 53 37 ii Commercial Real Estate Lending secured by mortgages on commercial real estates (office buildings, retail space, multi-purpose commercial premises, multi-family residential buildings, multi-tenanted commercial premise, Nil Nil industrial or warehouse space, hotels, land acquisition, development and construction, etc.) Exposure would also include non-fund based (NFB) limits. iii Investments in Mortgage Backed Securities (MBS) and other securitized exposures Nil Nil a. Residential Nil Nil b. Commercial Real Estate Nil Nil b Indirect Exposure Nil Nil Fund-based and non-fund based exposures on National Housing Bank (NHB) and Housing Finance Companies (HFCs) Nil Nil
9. Details of Single Borrower (SGL), Group Borrower Limit (GBL) exceeded by the bank: The bank had not exceeded the single borrower limit, group borrower limit fixed by the Board
10. Miscellaneous – Amount of provisions made for Income tax during the year. (Rs in '000s) Particulars Current Year Previous year Provision for Income Tax 2520380 1690600
11. Disclosure of Penalties imposed by RBI The Bank has maintained CRR and SLR as per RBI Act 1934 and Banking Regulation Act 1949 and not defaulted during the financial year under report. 12. Additional Disclosures as per Accounting Standards applicable to the Bank (i) Related party disclosure a) Related parties where control / significant influence exists or with whom transaction have taken place during the year. Sponsor Bank their Subsidiaries and Associates : State Bank of India
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Key Management Personnel Shri V. Narasi Reddy, Chairman Shri M. Satyanarayana, General Manager -I Shri T.V. Krishna Reddy General Manager-II Shri S.Prakash Kumar General Manager - III (Upto : 23.06.2017) Shri G. Nagaraju General Manager - III (From : 11.12.2017) Shri K. Ravi Kiran, General Manager - IV
(ii) Particulars of related party accounts transactions: The following is the summary of significant related party transactions: (Rs in '000s) For the year For the year ended 31st ended 31st March 2018 March 2017 Refinance received from State Bank of India Nil Nil Interest paid to SBI 58,82,80 81,65,40 Investments made with: SBI - in the form of STDRs 22,19,21,00 34,83,95,00 SBI Fund Management Private Limited Nil 49,57,53 Interest received from SBI 1,68,15,15 1,98,36,68 Profit on sale of Investments on SBI 7,79,96 10,98,93 Contributions to Gratuity Fund with SBI Life Insurance Company Limited Nil 7,32,69 Contributions to Group Leave Encashment Policy with SBI Life Insurance Company Limited 9,87,03 3,06,29 Current Account Balance with SBI 1,48,37 9,66
(iii) Particulars of Managerial Remuneration: (in Rupees) For the year For the year ended 31st ended 31st March 2018 March 2017 Shri V.Narasi Reddy, Chairman 21,80,811/- 21,68,711/- Shri M. Satyanarayana, General Manager - I 16,32,996/- 9,01,288/- Shri T.V.Krishna Reddy, General Manager - II 16,67,124/- 16,40,771/- Shri S. Prakash Kumar, General Manager - III 3,56,424/- 18,01,154/- Shri G.Nagaraju, General Manager - III 5,54,257/- Nil Shri K. Ravi Kiran, General Manager - IV 16,83,829/- 8,71,441/-
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13. Provisions on Rural Advances (Rs in '000s) S.No. Particulars Current Year Mar 2018 Previous Year Mar 2017 a Opening balance in the Rural Advances Provision Account 106736 106736 b The quantum of Rural Advances Provision made in the accounting year Nil Nil c i. Amount of Draw down made during the accounting year Nil Nil ii. Provision written back to profit and Loss account Nil Nil Total of Draw down Nil Nil d Closing balance in the Rural Advances Provision Account 106736 106736
14. Disposal of Complaints: A) Customer Complaints: S.No Particulars Nos a No. of complaints pending at the beginning of the year 01 b No. of complaints received during the year 2017-18 135 c Total Complaints 136 d No. of complaints redressed during the year 136 e No. of complaints pending at the end of the year 0
B) Award passed by the Banking Ombudsman: S.No Particulars Nos a No. of complaints pending at the beginning of the year 01 b No. of complaints received during the year 2017-18 43 c Total Complaints 44 d No. of complaints redressed during the year 43 e No. of complaints pending at the end of the year 01 f No. of awards passed by Banking Ombudsman 0 g No of awards implemented Not applicable h No. of awards pending implementation Not applicable
Pending complaint as on 31.03.2018 was received during the last week of March 2018, and we have taken up with Regional Office/Branches for redressal of the complaint
15. Concentration of Deposits, Advances, Exposures and NPAs 1. Concentration of Deposits (Rs in Cr) Total Deposits of Twenty largest depositors 724.02 Percentage of Deposits of twenty largest depositors to Total Deposits of the Bank 5.05%
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2. Concentration of Advances (Rs in Cr) Total Advances of Twenty largest Borrowers 15.16 Percentage of Advances of twenty largest borrowers to Total Advances of the Bank 0.11%
3. Concentration of Exposures (Rs in Cr) Total Exposure of Twenty largest Borrowers/Customers 724.02 Percentage of Exposures to twenty largest Borrowers/Customers to Total Exposure of the Bank on borrowers / customers 2.53%
4. Concentration of NPAs (Rs in Cr) Total Exposure to top four NPA accounts 2.00%
16. Sector Wise NPAs (Rs. in Cr) Current Year Mar 2018 Previous Year Mar 2017
Outstanding Gross NPAs Percentage of Outstanding Gross NPAs Percentage of Sl. No Sector* Total Gross NPAs to Total Gross NPAs to Advances Total Advances Advances Total Advances in that Sector in that Sector
A Priority Sector
1 Agriculture and 9686.33 82.77 0.85 8431.78 116.43 1.38 allied activities 2. Advances to industries sector eligible as 381.15 38.29 10.04 300.01 48.02 16.00 priority sector lending
3 Services 89.69 9.01 10.04 68.69 11.74 17.09 4 Personal Loans 2466.17 23.60 0.95 2340.03 23.49 1.00
Sub-Total (A) 12623.34 153.67 1.21 11140.51 199.68 1.79 B Non-Priority Sector 1 Agriculture and allied activities ------2 Industry ------3 Services ------4 Personal loans 1693.36 41.97 2.47 1228.02 10.06 0.82 Sub-Total (B) 1693.36 41.97 1228.02 10.06 0.82 2.47 Total (A+B) 14316.70 195.64 1.36 12368.53 209.74 1.69
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17. Movement of NPAs Particulars Rs. in Cr Gross NPAs as on 1st April 2017 (Opening Balance) 209.74 Additions (Fresh NPAs) during the year 305.26 Sub-Total (A) 515.00 Less: (I) Upgradations 60.09 (ii) Recoveries (excluding recoveries made from upgraded accounts) 245.32 (iii) Write-Offs 13.95 Sub-Total (B) 319.36 Gross NPAs as on 31st March 2018 (Closing Balance) (A-B) 195.64
II. NOTES TO ACCOUNTS 1. Reorganization of Area of Operations of the Bank: The Bank has been formed vide Notification dated 31st March 2006 issued by Department of Economic Affairs (Banking Division), Ministry of Finance, Government of India. As per the said notification, the area of the operation of the Bank is in eight districts of erstwhile State of Andhra Pradesh (Warangal, Medak, Khammam, Nalgonda, Mahabubnagar, Srikakulam, Vizianagaram and Visakhapatnam districts). Vide notification dated 20th October 2014 issued by the Department of Financial Services, Ministry of Finance, Government of India the districts of Warangal, Medak, Khammam, Nalgonda, Mahabubnagar are omitted. Pending finalization of the modalities for this notification and approvals from the competent authority, the operations of the bank are being carried out in all the five districts. Financial statements as at the end of the reporting date include assets and liabilities, income and expenses relating to the Bank in all the eight districts.
2. Classification of Assets (Advances) as on 31st March, 2018: (Rs in 000s) Classification Gross Advances Net Advances Standard Assets 14121 05 32 14121 05 32 Sub Standard Assets 26 26 74 22 14 60 Bad & Doubtful Assets 169 37 51 5 88 21 Total 14316 69 57 14149 08 13 Add: Provision on Sub-Standard And Doubtful Assets etc 167 61 44 Total Gross Advances 14316 69 57
3. Inter Bank Participation Certificate (IBPC): The bank has entered into Risk sharing participation Contract with State Bank of India (Sponsor Bank) under Inter Bank Participation Certificate (IBPC) and issued priority sector advances to the extent of Rs.1320,00,00 (thousands) on 13.02.2017 for the period of 180 days as cash pay-out and maturity period expired on 16.08.2017. During this financial year the Bank issued priority sector advances to the extent of Rs.1663,00,00 (thousands) on 14.09.2017 for the period of 180 days as cash pay-out and maturity period expired on 13.03.2018. Further, again during the year the bank issued priority sector advances to the extent of Rs.1800,00,00 (thousands) on 27.03.2018 for the period of 180 days as cash pay-out. The said cash pay-out is grouped in Balances with Banks in other deposit Accounts (Sch-7).
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4. Priority Sector Lending Certificate (PSLC): The Bank has sold the priority sector advances (SF/MF) of Rs.50,00,00 (thousands) on 28th December 2017, validity upto 31st March 2018. 5. Bankers' Cheques: The Unpaid Banker Cheques which were credited earlier years to P&L account aggregating to Rs.1,10,45 (in thousands) furnished as contingent liability in Schedule 12. 6. Depositor Education and Awareness Fund (DEAF) Scheme: Disclosure as required under Depositor Education And Awareness Fund Scheme – 2014 notified by the Reserve Bank of India under DBOD No. DEAF Cell.BC.114/30.01.002/ 2013-14 dated 27th May 2014:
(Rs in 000s) Sl No Particulars Current Year Mar 2018 Previous Year Mar 2017 1 Opening Balance of Amount transferred to DEAF 1,33,66 1,34,75 2 Add: Amount transferred to DEAF during the Year 16,89 5,36 3 Less: Amounts reimbursed by DEAF towards Claim 15,57 6,45 4 Closing balance of amounts transferred to DEAF 1,34,98 1,33,66
7. Fixed Assets: The Bank is in possession of Land at various places to the extent of 9,432.26 square yards, which was gifted by certain donors / assigned by Government of Andhra Pradesh for construction of Office Buildings. The Bank had incurred site development expenditure and the said costs were capitalized under Land. During the earlier years the Bank has given Contract to Bharat Sanchar Nigam Limited (BSNL) for construction of Office Buildings at various locations and amounts paid to BSNL against the bills submitted for construction / initial advance aggregating to Rs.5,52,25 (thousands) which was disclosed under Capital Work in progress in Fixed Assets Schedule and pertaining to the constructions completed buildings Rs.1,43,28 (thousands) was capitalized during the year. 8. Income Tax Matters: Income Tax department has raised certain demands on the Bank, with regard to assessment of income of the Bank and the tax payable thereon. The Bank is contesting demands raised by the Income Tax Department and pursuing the same. Against the said tax demands based on the opinion obtained from the tax consultant, the Bank recognized an amount aggregate to Rs.18,14,00 (thousands) as Contingent Liabilities and are shown in Schedule 12 - "Contingent Liabilities - Claims against the Banks not acknowledged as debts". Against the disputed claims, the Bank paid an amount of Rs.37,22,31 (thousands) and the same is being shown in Schedule 11 - "Other Assets - Income Tax paid against Disputed Demand". Bank is confident of resolving the dispute in it's favour. Liability, if any, will be charged to Profit and Loss account in the year of settlement of these disputes / claims. 9. Data Purification and Asset Classification The Bank is having a seamless system in its Core Banking Solution (CBS) for recognizing and identifying the non performing assets in accordance with the extant guidelines. Further, the Bank has a system of manual verification for ensuring the correctness of base data fed. Management intends to continue such manual verification to ensure compliance of the Income Recognition and Asset Classification norms and other statutory compliances.
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10. Fraud Cases: Details of Fraud cases are as under: (Rs in 000s) Particulars 31.03.2018 31.03.2017 Provision at the beginning of the year 91,28 1,44,53 Less: Written off during the year 69,93 53,25 Add: Additional provision created during the year 59,29 Nil Less : Provision reversed during the year Nil Nil Provision as at the year end 80,64 91,28 Number of fraud cases at the year end 17 8
11. The figures mentioned in Balance Sheet, Profit & Loss Account and Schedules 1 to 16 have been rounded off to the nearest thousand rupees. 12. Previous Year's figures have been regrouped /reclassified/recast wherever necessary to confirm the current year classification.
As per our report of even date For Rao & Kumar Chartered Accountants For Andhra Pradesh Grameena Vikas Bank Firm Registration No: 003089S
(CA. C.M.Ravi Prasad ) (T.V.Krishna Reddy) (V.Narasi Reddy) Partner General Manager-II Chairman Membership No : 211322
(Y.Rambabu) (Kasi Srinivas) (S.Ganesan) Director Director Director
(V.S.Gupta) (Smt.K.Amrapali, IAS) (K.V.V.Satyanarayana, IRAS) Director Director Director
Place: Ramachandrapuram, Medak Dist. Date: 2nd May 2018
100 The Smile on the face of our Shivampet Branch's borrower says it all....
Head office : 2-5-8/1 Near Ambedkar Statue, Ramanagar, Hanamkonda - 506 001 Warangal [Telangana] Ph: 0870-2577256 I Tollfree: 18004257900 I e-mail: [email protected] I www.apgvbank.in