PERFORMANCE OF KUMBAKONAM CENTRAL CO-OPERATIVE BANK LTD KUMBAKONAM THANJAVUR DISTRICCT – A MULTI DIMENSIONAL ANALYSIS A Thesis submitted to the BHARATHIDASAN UNIVERSITY, TIRUCHIRAPALLI, In partial fulfilment of the requirements for the award of the degree of DOCTOR OF PHILOSOPHY IN COMMERCE Submitted by R.ILAMATHI. M.Com.,M.Phil., Ref. No.22575/Commerce/Part-time/Jan.2011. Under the Guidance of Dr. N.UDAYAKUMARI, M.Com, MBA., M.Phil., Ph.D., Associate Professor in Commerce, A.D.M College for Women (Autonomous) Nagapattinam – 611 001 PG AND RESERCH DEPARTMENT OF COMMERACE A.D.M. COLLEGE FOR WOMEN (AUTONOMOUS) NAGGAPATTINAM. (AFFLIATED TO BHARATHIDASAN UNIVERSITY) JULY- 2014 Dr. N.UDAYAKUMARI,I M.Com, MBA. M.Phil., Ph.D., Associate Professor in Commerce, A.D.M College for Women (Autonomous) Nagapattinam-611 001. July- 2014 CERTIFICATE This is to certify that the Thesis entitled “PERFORMANCE OF KUMBAKONAM CENTRAL CO-OPERATIVE BANK LTD., KUMBAKONAM, THANJAVUR DISTRICT - A MULTI DIMENSIONAL ANALIYSIS” submitted to the Bharathidasan University, Thiruchirappalli, is a bonafide record of the research work done by Mrs. R. ILAMATHI, during the period of her study in fulfilment of the requirement of the Ph.D., in Commerce and the thesis has not previously formed the basis for the award of any degree, diploma, associateship, fellowship or any other similar title. Also certified that the thesis represents independent work on the part of the candidate. Place : Nagappttinam Research Advisor. Date : (Dr.N.UDAYAKUMARI) R.ILAMATHI, M.Com, MPhil., Guest Lecturer in Commerce. M.R.Govt. Arts. College. Mannargudi-614 001. DECLARATION I R.ILAMATHI, hereby declare that the thesis entitled “PERFORMANCE OF KUMBAKONAM CENTRAL CO-OPERATIVE BANK LTD, KUMBAKONAM, THANJAVUR DISTRICT - A MULTI DIMENSIONAL ANALIYSIS” is my original work and that it has not previously formed the basis for the award of any degree, diploma, associate ship, fellowship or other similar title. This work has been done under the guidance and supervision of Dr. N.UDAYAKUMARI, Associate Professor, Department of Commerce, and A.D.M. College for Women (Autonomous), Nagapattinam. Research Scholar. (R.ILAMATHI) Place : Nagappttinam Date : ACKNOWLEDGEMENT I am conscious of my indebtedness to each and every individual, who helped me in many ways in the preparation of this thesis entitled “PERFORMANCE OF KUMBAKONAM CENTRAL CO-OPERATIVE BANK LTD., KUMBAKONAM, AND THANJAVUR DISTRICT - A MULTI DIMENSIONAL ANALIYSIS” I am grateful to the authorities of BHARATHIDASAN UNIVERSITY for having given me an opportunity to undergo Ph.D., programme. I sincerely record my thanks to the President, Vice –President, Secretary, and members of the management committee of A.D.M College for women (Autonomous), Nagapattinam, for giving me an opportunity to do this part-time research work and for providing necessary infrastructure and resources to accomplish my research work. My heartfelt thanks are due to Dr. S.MYTHILI, Principal, A.D.M College for women (Autonomous), Nagapattinam. She not only permitted me to pursue the study but also rendered support in the completion of this research work. I deem to great pleasure and privilege to have an opportunity to take up this thesis work under guidance of Dr. N.UDAYAKUMARI., MCom., MBA., MPhil., Ph,D., there is no enough words to thank her devotion to this task. She is intelligence, extensive and penetrative knowledge, simple and elegant expressions are highly commendable. Her guidance helped me in all the time of research and writing of this thesis. I could not have imagined having a better advisor and mentor for my Ph.D. study. Dr. M.SELVA CHANDRA, Head, Department of Commerce, A.D.M College for women (Autonomous), Nagapattinam for having permitted me to undergo the course. I extend my heartfelt thanks to our Dr. D.CHIRSTY SELVARANI, Associate Professor in Department of commerce, Urumu Dhanalakshmi College, Thiruchirappalli and Dr. P.HEMALATHA, Associate Professor in Department of Commerce, Govt. Art. College, Kombakkonam for their association with Doctoral committee and also for their valuable suggestions at different stages of the study. I gratefully acknowledge Dr. N PALANIVELU, Sri Venkateswara college of Arts and science peravurani for his understanding, encouragement and personal attention which have provided good and smooth basis for my Ph.D. thesis. I extend my sincere thanks to J.KANNAN Head of the department M.R.G.Arts college mannargudi, Dr.M.PALANI, K.GANDHI, T.R.MURALITHARAN, and other colleagues have always inspired me with his expansive knowledge and progressive thoughts. I warmly thank Dr. R RENUGA., SASTRA UVIVERSITY THANJAVUR., for her valuable advice, constructive criticism and his extensive discussions around my work. I wish to record my thanks to Mr. S.SATHIKUMAR, Manager of District Central Co-operative Bank of Kumbakkonam. I am very thanking full to Mr. K.JAYAKANTHAN, District Police Co-operative society, Thiruvarur. My sincere thanks to Mr.KARMEGAM District Central Co-operative Bank of Kumbakkonam.I would like to put on record the inputs provided by the Librarian of various universities in tamilnadu and special thanks to District central Library in Thiruvarur District.I dedicate this work to my spouse Mr. S.CHINNAPPAN, my children C.E.SRIDHARSINI , C.E.SURTHIDHARSINI and my Parents. Last but not least, I would like to pay high regards to my, brothers R.INDHIYARAJA AND R.ELAYARAJA for their sincere encouragement and inspiration throughout my research work and lifting me uphill this phase of life. I owe everything to them. Besides this, several people have knowingly and unknowingly helped me in the successful completion of this project. (R.ILAMATHI) PERFORMANCE OF KUMBAKONAM CENTRAL CO-OPERATIVE BANK LTD KUMBAKONAM THANJAVUR DISTRICT – A MULTI DIMENSIONAL ANALYSIS Researcher : R.ILAMATHI Guide : Dr. N.UDAYAKUMARI ABSTRACT A co-operative bank is a financial entity which belongs to its members, who are at the same time the owners and the members of their bank. The organization of the kumbakonam central co-operative bank ltd kumbakonam consists of two wings, deliberative and executive. The deliberative wing consists of the General Body, the Board of Management and the Chairman. The executive wing at the headquarters is further divided into two: the Banking Wing and Administrative Wing. The branch (32 branches) organizations at the taluk and village level constitute an important link between the KCCB and the primary agricultural co-operative bank. Its main functions are to create the habit of savings among the people: mobilize deposits, scrutinise loan applications and recover the loans in its area of operations. Analyse the present agricultural credit system in the Bank and to reveal the different schemes provided by the bank for agricultural sector, to make members to be aware of benefits of co-operative banks and to avail these services rendered by the bank. MŒÎ jiy¥ò “F«gnfhz« k¤Âa T£LwÎ t§»æ‹ brašãiy g‰¿a gy gçkhz mQFKiw” jŠrhñ® kht£l«, jäœehL. MŒths® bga® : uh. Ïsk MŒÎ nk‰gh®itahs® : e. cjaFkhç T£LwÎ t§»fŸ j« cW¥Ãd®fë‹ bghUshjhu ãiyia ca®¤Jtš bgU« g§F t»¡»‹wJ. F«gnfhz« k¤Âa T£LwÎ t§» Ïu©L ãiyfëš ã®thf« brŒ»‹wJ. Kjš ãiyæš t§»æ‹ jiyt® k‰W« bghJ¡FG cW¥Ãd®fŸ 32 nk‰g£l t§» »isfis ã®thf« brŒ»‹wd®. k‰bwhU ãiyæš 32 t§» »isfS« gšntW jhY¡fh k‰W« »uhk mséš ÏU¡f¡Toa T£LwÎ t§»fis ã®thf« brŒ»‹wd®. nkY« Ï›t§», it¥ò bjhif Mjhu¤ij bgU¡» j‹Dila cW¥Ãd®fS¡F fl‹ tH§F»‹wd®. cW¥Ãd®fŸ th§F« flid v›thW ÂU¥Ã brY¤J»‹wd®. nkY« cW¥Ãd®fS¡F t§»æ‹ gâahš cŸs kdãiwit MŒÎ brŒa¥g£LŸsJ. CHAPTER ARRANGEMENT Chapter No. Contents Page No. I Introduction and Design of the Study 1 II Review of Literature 24 III District Central Co-operative Banks – An overview 42 Analysis of Financial Performance of IV 67 KCC Bank Ltd. and Interpretation Analysis of Members Satisfaction of V 177 KCC Bank Ltd. VI Summary of Findings, Suggestions and Conclusions 210 Bibliography 230 Appendices 238 LIST OF TABLES Table No. TITLE Page No. 4.1 Membership 88 4.2 Total Deposits 93 4.3 Agricultural Credit to Total Loans & Advances 98 4.4 Agricultural Credit Stabilization Fund 100 4.5 Total Loans and Advances 102 4.6 Jewel Loans 106 4.7 percentage of NPAs to total loans & Advances 121 4.8 percentage of NPAs to Assets 123 4.9 Calls, Collection and Outstanding 125 4.10 Reserve fund 127 4.11 Total Investment 129 4.12 Balance with other banks 131 4.13 Bad & doubtful debt reserve 133 4.14 Current Ratio 137 4.15 Quick ratio 140 4.16 Debt.-equity Ratio 143 4.17 Debt to Total funds 146 4.18 Capital Gearing Ratio 148 4.19 Return on capital employed 151 4.20 Return on Equity 153 4.21 Net profit to working capital 155 4.22 Interest Earned Ratio 157 4.23 Interest Paid Ratio 159 4.24 Total income to volume of Business 161 4.25 Man power expenses ratio 163 4.26 Establishment Expenses Ratio 165 4.27 Non-Interest Income Ratio 167 4.28 Spread Ratio 169 4.29 Burden Ratio 171 4.30 Profitability Ratio 173 5.1 Age Wise Classification of Respondents 178 5.2 Sex wise classification of the respondents 179 5.3 Educational status of the respondents 180 5.4 Occupation of the respondents 181 5.5 Annual income of the respondents 181 5.6 Purpose of the loan of the respondents 182 5.7 Nature of land of the respondents 183 5.8 Types of loan offered by PCCB Ltd 183 5.9 Irrigation Facility 184 5.10 Reason for Non-repayment of loan 185 5.11 Time allowed for repayment of loan 186 5.12 Reason for having deposits in PCCB Ltd 187 5.13 Types of Deposit 188 5.14 Quantum of savings of the respondents 189 5.15 Awareness of various loan schemes offered by 190 PCCB Ltd 5.16 Satisfactory level of the respondents towards borrowings 191 5.17 Satisfactory level of the respondents towards deposits 194 5.18 Class A&B members attitude towards their kumbakonam 197 central cooperative banks 5.19 Association between Demographic Variables of the 199 Respondents and their Attitude towards the Bank 5.20 Class a and b customer’s attitude towards the performance 201 variables of kumbakonam central cooperative bank 5.21 Impact of Attitude towards Performance Variables of banks 204 on Overall Attitude 5.22 Impact of Demographic Variables on an Overall Attitude 207 towards the banks LIST OF CHARTS Table No.