" Your Directors have pleasure in presenting the One Hundred and Sixth Annual
Report of your Bank with the audited Balance Sheet, Profit & Loss Account and
the Report on Business and operations for the year ended March 31, 2014 (FY14)."
- Total Business (Deposit+Advances) increased to Rs
9,65,900 crore reflecting a growth of 20.43% (y-o-y).
- Gross Profit and Net Profit were Rs 9,291 crore and
Rs 4,541 crore respectively. Net Profit registered a
growth of 1.35% over the previous year.
- Credit-Deposit Ratio stood at 86.15% as against
82.03% last year.
- Retail Credit posted a growth of 20.96% constituting
16.6% of your Bank’s Gross Domestic Credit in FY14.
- MSME Credit posted a growth of 21.21% constituting
20.3% of your Bank’s Gross Domestic Credit in FY14.
- Net Interest Margin (NIM) as per cent of interest earning
assets in global operations was at the level of 2.36% and
in domestic operations at 2.87% during FY14.
- Net NPAs to Net Advances stood at 1.52% this year
against 1.28% last year.
- Capital Adequacy Ratio (CAR) as per Basel II stood
- Capital Adequacy Ratio (CAR) as per Basel III stood
- Net Worth improved to Rs 34,933 crore registering a
rise of 13.7%.
- Book Value improved from Rs 729.11 to Rs 813.50 on year.
- Business per Employee moved up from Rs 1,689 lakh
to Rs1,865 lakh on year.
The Segment Results for the year FY14 reveal that the
contribution of Treasury Operations was Rs 1,527.24 crore,
that of Corporate/Wholesale Banking was minus Rs 461.11
crore, that of Retail Banking was Rs 3,359.84 crore, and
of Other Banking Operations was Rs 2,458.02 crore.
Your Bank earned a Profit after Tax (PAT) of Rs 4,541.08 crore after deducting Rs 1,386.68 crore of unallocated
expenditure and Rs 956.23 crore towards provision for tax.
Key Financial Ratios
Return on Average Assets (ROAA) (%)
Average Cost of Funds (%)
Average Yield (%)
Average Interest Earning Assets (Rs crore)
Average Interest Bearing Liabilities (Rs crore)
Net Interest Margin (%)
Cost-Income Ratio (%)
Book Value per Share (Rs)
Your Bank’s Directors have proposed a final dividend of Rs
10.50 per share. The final dividend together with interim
dividend of Rs 11 per share paid in January 2014 results
in total dividend of Rs 21.5 per share (on the face value
of Rs 10/-per share) for the year ended March 31st, 2014.
The total outgo in the form of dividend, including taxes, will
be Rs 1,083.68 crore..
Capital Adequacy Ratio (CAR)
Your Bank’s Capital Adequacy Ratio (CAR) was
comfortable at 12.87% under Basel II and at 12.28% under
Basel III as on 31st March 2014. Moreover, your Bank’s
Tier 1 ratio was at 9.28% and common equity Tier 1 was at
8.95% under Basel III framework.
Your Bank’s Net Worth as at 31st March 2014 was Rs
34,933.06 crore comprising paid-up equity capital of Rs
430.68 crore and reserves (excluding revaluation reserves)
of Rs 34,502.38 crore. An amount of Rs 3,457.40 crore was
transferred to reserves from the profits earned.
Provisions towards Retirement and Other Benefits
During the year FY14, your Bank made provision towards
contribution to gratuity (Rs 100.72 crore), pension funds
(Rs 1,014.76 crore), leave encashment (Rs 106.18 crore)
and additional retirement benefits (Rs 54.71 crore) on
actuarial basis. Total provisions under these four categories
amounted to Rs 1,276.37 crore during the year FY14,
against Rs 1,205.63 crore during FY13. Total corpus
available with your Bank at the end of March 2014 under
these heads was: Rs 1,532.62 crore (gratuity), Rs 7,893.50
crore (pension funds), Rs 735.69 crore (leave encashment)
and Rs 647.17 crore (additional retirement benefit).
Management Discussion and Analysis
Economic Scene in FY14 and Outlook for FY15
The financial year 2013-14 (FY14) began with multifarious
developments including elevation of inflation, heightened
rupee volatility and worsening current account deficit apart
from growth slowdown and sharp industrial contraction.
However, as the year progressed, especially from the third
quarter onwards, there were firm signs of stability on the
external front, partial easing of inflationary pressures and
positive outlook towards growth.
During the third week of May 2013, the US suggested
the possibility of “scaling back of its monetary stimulus or
tapering” and there were wide spread repercussions on
the emerging markets in general and on India, in particular,
wherein not only the financial markets and asset prices
saw a sharp decline but even the growth-inflation dynamics
worsened further. The rupee-dollar exchange rates slumped
to a record low of Rs 68.8 in late August 2013. The money
markets were also under pressure with call money rates
spiking to 9.5% and hardening of government bond yields.
In response, the Reserve Bank of India (RBI) took a series
of policy initiatives in mid-July to address exchange rate
volatility so that it does not risk macroeconomic stability and
growth sustainability. The measures undertaken included
initiatives to contain domestic liquidity by sharply increasing
Marginal Standing Facility (MSF) rate, moderating outflows
and encouraging FX inflows through liberalized External
Commercial Borrowings (ECBs) and Foreign Currency
Non Resident (Bank) or FCNR (B) deposits. Apart from
these, the government increased customs duty on gold
and compressed demand for oil as well as curbed nonessential
imports. External inflows were also encouraged.
Consequently, the rupee recovered rather sharply to over
Rs 60.0 per US dollar and touched a high of Rs 59.9 per
dollar on March 28, 2014.
As the uncertainties surrounding “taper” decimated
and domestic policy initiatives had positive impact,
there was significant reduction in rupee volatility. The
Current Account Deficit (CAD) which had peaked due
to heightened outflows also contracted to 0.9% of GDP
in Q3, FY14 from 6.7% of GDP in Q3, FY13. As India’s
currency stabilised, the RBI began unwinding the
unconventional monetary measures from September,
2013 in an orderly fashion. Among them, the marginal
standing facility (MSF) which was increased by 200 bps to
10.3% on July 15, 2013 was gradually reduced in stages
to 9.0% on December 18, 2013 and maintained at that
level till the end of the financial year.
In the real sector, the ongoing contraction of mining and
manufacturing sectors pulled down the real GDP growth
to 4.8% in Q3, FY14. While the growth concerns remained
significant for industrial and services sectors, the favourable
monsoon rainfall improved the agricultural performance
during FY14. Yet, majority of private forecasting agencies
estimate the full year’s growth for FY14 in the band of 4.6%
As in the past few years, the inflationary situation remained
a dominant macro risk for India throughout the year FY14.
The CPI inflation averaged around 9.5% throughout the
year FY14 on the back of elevated food and fuel inflation.
Despite the correction in vegetable prices during Dec-Jan,
FY14 as well as the favourable monsoon and agricultural
production scenario in FY14, food inflation at the retail
level remained elevated highlighting the innate supply
chain inefficiencies. Additionally, the upward adjustment
in diesel prices and electricity tariffs too impacted the CPI
trajectory during FY14.
The Interim Budget for FY15 presented by Government of
India showed continued fiscal consolidation, with a fall in
the fiscal deficit from 4.9% of GDP in FY13 to 4.6% of GDP
in FY14 and further to 4.1% of GDP in FY15. While the
revised estimates of both the revenue and fiscal deficits for
FY14 are lower than the budgeted estimates, the expenses
on subsidies, interest payments and pensions overshot the
budgeted target and their impact was absorbed by lower
Most of the private and public think-tanks from across
the globe including International Monetary Fund (IMF)
believe that Indian economy will recover in FY15 and
the recovery will be enabled by a relatively stronger
world economy, improving export competitiveness and
policies encouraging investment. While the CPI inflation
is expected to remain an important challenge for India,
it should continue to move onto a downward trajectory
during the major part of FY15.
Performance of Indian Banking Sector in FY14
and Outlook for FY15
Against the backdrop of a slowdown in the domestic
economy and tepid global recovery, the growth of the Indian
banking sector remained under pressure even in FY14. The
deposit and credit growth was marginally better than that
in FY13. The growth in deposits of scheduled commercial
banks (SCBs) at 14.6% in FY14 was marginally better than
the growth at 14.2% in the previous financial year. However,
this growth was primarily driven by the liberal policy adopted
by the RBI towards non-resident Indian deposits. The credit
growth at 14.3% in FY14 too was marginally better than that
at 14.1% in FY13.
Due to exchange market pressures during Q2, FY14 the
RBI had to take exceptional measures that resulted in
firming up of both deposit and lending rates in September,
2013. With the ebbing of pressures on exchange rate, the
RBI rolled back these exceptional measures in a calibrated
manner and, in response to that the lending rates softened
a bit in H2 of FY14. On balance, however, the lending
rates were by and large sticky during the year. As inflation
remained at elevated levels, the banks were compelled to
offer attractive interest rates on their term deposits so as
to protect their liability franchise. The sticky and elevated
cost of deposits combined with subdued credit demand
suppressed the banks’ earnings profile. Given the bleak
macroeconomic environment and worsening repayment capacity of borrowers, the asset quality deteriorated and
pipeline of restructured assets remained large during the
financial year FY14.
However, most of the financial experts and analysts feel that
the worst is over for the Indian banking industry, as there
will be increased clarity on macroeconomic and political
fronts during FY15. On the positive side, liquidity remains
steady, inflation is expected to move downwards for the
major part of FY15 and the RBI is in full control to manage
any volatility. Macro recovery and potential for post-election
reforms should see a gradual reduction in stressed loans
on lower slippages and higher recoveries.
To ensure sustainable and consistent growth, your Bank
has developed a sound risk management framework so that
the risks assumed by the Bank are properly assessed and
monitored continuously. It may be noted that the ultimate
responsibility for setting up the risk management framework
lies with the Board of the Bank. It includes setting up risk
appetite, framing policies and effective monitoring. Your
Bank’s Board has put in place a robust Enterprise-wide Risk
Management architecture so that the risks remain within the
risk appetite defined by the Board.
The Board of Directors has oversight on all the risks
assumed by the Bank. Specific committees of the Board
have been constituted to facilitate focused oversight on
various risks. Policies approved from time to time by the
Board of Directors or committees of the Board form the
governing framework for each type of risk. The business
activities are undertaken within these policy frameworks.
A brief outline of the mechanism for identifying, evaluating
and managing various risks within your Bank is as follows.
Asset Liability Management (ALM)
Your Bank’s Asset Liability Management (ALM) is aimed at
strategic planning, implementation, and control processes
that affect the volume, mix, maturity, rate sensitivity, quality,
and liquidity of the Bank’s assets and liabilities, thereby
ensuring that the returns are commensurate with the level
of risk taken.
The ALM is the function of Asset Liability Management
Committee (ALCO), which comprises of General Managers
and Executive Directors and is headed by the Chairman
and Managing Director. It operates under the guidance and
supervision of the Board and/or Sub-Committee of Board
on ALM and Risk Management. It meets at regular intervals
to review the interest rate scenario, product pricing for both
deposits and advances, maturity profile of the incremental
assets and liabilities, demand for Bank funds, cash flows
of the Bank, profit planning and overall Balance Sheet
Management. The ALCO is also entrusted with the job of
fixing Base rate and pricing of advances & deposit products
and suggesting revisions of Base Rate to the Board.
In your Bank, the liquidity risk is measured and monitored
through two approaches-Flow approach and Stock approach. Flow approach is done through preparation
of Structural liquidity statement on a daily basis against
prudential caps fixed for liquidity gap positions. The quality of
liquidity is further tested by working out various ratios under
Stock Approach, wherein a series of prudential caps are
tested on a daily basis. The compliance to Stock Approach
caps ensures that the Bank has managed its liquidity through
appropriate diversification and kept it within the sustainable
limit. Moreover, liquidity position is projected every fortnight,
for the subsequent three months on a dynamic basis through
Dynamic Gap Reports.
For measurement and monitoring of Interest rate risk,
currency wise, both Traditional gap approach and Duration
gap approaches are followed. The short-term impact of
interest rate movements on NIM is worked out through
“Earnings at Risk” approach taking into consideration Yield
curve risk, Basis risk and Embedded Options Risk. The
long-term impact of interest rate movements on Market
Value of Equity is also worked out through Duration Gap
Advanced techniques such as stress testing of liquidity
risk and interest rate risk, simulation, sensitivity analysis
etc., are used on regular intervals to draw the contingency
funding plan under different liquidity and interest rate
scenarios. Your Bank has also put in place contingency
plans to meet its liquidity obligations under various stressed
Your Bank is in the process of implementing Oracle
Financial Services Analytics and Applications (OFSAA)
platform, which is a multi-currency ALM, Fund Transfer
Pricing (FTP) and profitability solution, offering extensive
data management capabilities for accurate information
gathering and analysis. With a powerful suite of analytical
and reporting tools, the efficient liquidity and interest rate
risk management has been facilitated, enabling strategic
decision-making and generating alerts against potential
Your Bank’s Credit Risk management is governed by a
comprehensive and well-defined Credit Policy which is
approved by the Board. It encompasses credit approval
processes for all business segments along with the
guidelines for monitoring and mitigating the risks associated
with them. The Board of Directors of your Bank endorses
the credit risk strategy and approves the credit risk policies.
In line with international best practices, there is a clear
segregation between risk takers and policy framers.
Your Bank has put in place a structured and standardised
credit approval process which includes a well established
procedure of comprehensive credit appraisal and credit
rating. Furthermore, your Bank has adopted risk-based
delegated lending power, where higher discretionary lending
powers have been delegated for low credit risk proposals.
The rating serves as a key input in the approval as well as
post-approval credit processes.
Your Bank has in place a robust two dimensional credit
rating system which reflects both client rating and facility
rating. The two dimensional approach is more precise and
consistent as it records Probability of Default (PD) and Loss
Given Default (LGD). Over the years, your Bank has gained
rich experience in internal rating and has built up data on
credit rating migration. This robust platform has enabled
your Bank to make an application to the RBI to migrate to
Foundation Internal Ratings’ Based (FIRB) approach of
Credit Risk under Basel II rules. The FIRB implementation
will also prepare your Bank to drive its business in more
systematic and sophisticated manner in terms of risk-based
pricing, optimum portfolio construction and fixation of risk
Also, your Bank conducts industry studies to track
emerging risk factor across industries and to identify
sunrise sectors. This industry knowledge is supplemented
through field visits, interacting with clients, sector
regulators and industry experts. To manage the undue
concentration risk in the portfolios, the Bank has put in
place prudential caps across industries, sectors and
borrowers. The corporate research cell also carries
out detailed sectoral studies, identifies portfolio trends,
and generates portfolio level MIS covering various
credit quality indicators like sectoral exposure, credit
concentration, ratings distribution and migration.
Market Risk is the “risk” of loss of earnings or economic
value due to adverse changes in market rates or prices.
The sources of market risk may be enumerated as under.
• Interest rate risk: The exposure that is affected by
adverse movement and volatility in various yield curves
and credit spreads.
• Currency exchange rate risk: The risk that arises from
changes in exchange rates and their volatility.
• Equity price risk: The risk that arises from changes in
the prices of equities, equity indices, equity baskets
and volatility in stock market.
The market risk may also arise from changes in commodity
prices and volatility. However, your Bank does not have any
exposure to commodity related markets.
Your Bank has clearly articulated policies to control and
monitor its treasury functions. These policies comprise
management practices, procedures, prudential risk limits,
review mechanisms and reporting systems. These policies
are reviewed regularly in line with changes in financial and
The Interest rate risk in your Bank is measured through
Interest Rate Sensitivity Gap Reports and Earning at Risk.
Furthermore, your Bank calculates duration, modified
duration, Value at Risk for its investment portfolio consisting
of fixed income securities, equities and forex positions on
daily basis. It monitors the short-term Interest rate risk
from the Net Interest Income (NII) perspective and longterm interest rate risk from the Economic Value of Equity
(EVE) perspective. The Value at Risk for the treasury
position is calculated for ten days holding period, at 99.0%
confidence level. Moreover, the stress testing of fixed
interest investment portfolio through sensitivity analysis and
equities through scenario analysis is regularly conducted
in your Bank.
Based on the RBI directions, your Bank has also been
estimating the “Economic Value of Equity Impact” on a
Operational Risk implies the risk of loss resulting
from inadequate or failed internal processes, people
and systems or from external events. This includes
legal risk, but excludes strategic and reputational
risks. Your Bank has a robust and comprehensive
Operational Risk Management Framework (ORMF)
to meet the qualitative and quantitative requirements
of the Standardized Approach (TSA) and Advanced
Measurement Approach (AMA) of Basel II requirements.
Operational Risk Management Committee (ORMC) of
your Bank shoulders the responsibility of monitoring and
controlling the operational risk by way of prescribing/
amending processes, imposing controls and defining
roles and responsibilities. Your Bank has sound
operational risk governance practice with three lines of
defence mechanism such as Business line management,
independent corporate operational risk management
function and an independent inspection and audit
function to ensure that its internal guidelines, policies
and procedures are complied with.
Your Bank is in the process of implementing a globally
accredited sophisticated system (SAS EGRC 5.1) to capture,
measure, monitor and manage its operational risk exposure
by installing an enterprise-level automated web-based
solution. The solution is expected to be fully operational
before the end of the half-year of FY15. Moreover, your bank
is one of the promoters and initial equity capital subscribers
to a company which will be a consortium of Operational Risk
loss data in India for the banking industry.
Basel III Implementation
The Basel III capital regulations were implemented in India
with effect from April 1, 2013. To ensure smooth transition
to full Basel III, appropriate transitional arrangements have
been provided with full implementation as on March 31,
2019. The Basel III capital rules also require an enhanced
set of disclosures on the components of Capital Adequacy
Ratio (CAR) which are published separately.
Risk-Based Supervision by RBI–A Change
from the CAMELS System
The growing complexities in the banking business and
lessons from the recent financial crisis have resulted in a
thorough overhaul of the global regulatory and supervisory
benchmarks. There were revised prescriptions for more resilient banks and banking systems (Basel III), revised
core principles for effective bank supervision, new
principles for supervision of financial conglomerates and
planning for recovery and resolution of global systemically
important banks, etc. This needed a relook at the RBI’s
extant supervisory processes and mechanism in order to
make it more robust and capable of addressing emerging
With this view, the RBI has introduced a concept of Risk-
Based Supervision (RBS) that will focus on evaluating both
present and future risks - as against the present compliancebased
and transaction testing approach (CAMELS). The
“Risk Based Supervision” Framework introduced by RBI
for Indian banks is named as “Supervisory Program for
Assessment of Risk and Capital (SPARC)” and “Integrated
Risk and Impact Scoring (IRISc)” Model is one of its most
Under the RBS, the probability of failure of a bank and the
likely impact of this failure is calculated. Also, the banks
assessed as having a low risk/impact profile would be
inspected only once in a two to three year cycle.
The RBI proposes to use thematic reviews increasingly as
a tool of supervision whereby it will carry out review of a
particular product, market or practice to assess risks brewing
within the sector or at systemic level for enabling prompt
A single point contact in the form of an exclusive ‘Senior
Supervisory Manager’ (SSM) is created within the
Department of Banking Supervision of RBI (DBS) to ensure
efficient and effective communication between the RBI and
While the CAMELS carried out “performance evaluation”
of banks, the RBS will determine the “probability of failure
of a bank and its impact in the light of- (1) risks to which a
bank is exposed, (2) the strength of control and governance,
(3) oversight framework in place and (4) available capital.
Based on the rating, a particular bank would be apprised of
the direction/ trend of key risks along with overall risk faced
by it and a risk-mitigation plan, comprising of a need for
improving controls, augmenting capital and/ or restructuring
the existing business.
Under RBS, the focus will also be on the potential risks
arising from the material group entities to the parent bank.
It may be noted that your Bank was one of the few banks
selected for the first cycle of supervisory review under the
RBS–2013, given its systemic importance. Both the off-site
and on-site supervision were successfully completed within
the given timeframe for your Bank.
Credit Monitoring Function
Credit monitoring is one of the most important tools for
ensuring quality of advance assets. Your Bank has the
system of monitoring of the advance accounts at various
levels (Branch/Region/Zone and Corporate) to prevent asset
quality slippages and to take timely corrective actions to improve the quality of its credit portfolio.
A separate department for Credit Monitoring functions at
the Corporate level, headed by a General Manager, and one
at the Regional and Zonal level, started functioning since
September 2008. The Slippage Prevention Task Force
(SPTF) formed at all Zonal, Regional offices in terms of the
Bank’s Domestic Loan Policy was activated for the purpose
of arresting slippages and also for initiating necessary
restructuring in potential and viable sick accounts at an early
stage in a time bound manner.
The primary objectives of the Credit Monitoring Department
at the Corporate level are enumerated as under:
- Identification of weakness/Potential default/incipient
sickness in the advance account at an early stage;
- Initiation of suitable and timely corrective actions for
preventing further impairment in advance accounts/
deterioration in credit quality of the borrowal
- Prevention of slippage in the Asset Classification and
relegation in Credit Ratings through vigorous follow up;
- Identification of suitable cases for restructuring/
rescheduling/ rephasement as well as further financing
in deserving and genuine cases with matching
contribution from the borrower; Liaisoning with CDR
Cell, ZO & ROs;
- Taking necessary steps / regular follow up, for review
of accounts and compliance of terms and conditions,
thereby improving the quality of Bank’s credit portfolio;
- Monitoring progress of accounts under Board for
Industrial and Financial Reconstruction (BIFR).
Monthly Monitoring of Advances accounts
On-line web-based software developed by the IT Department
for Monthly Monitoring Reports (MMR) in respect of advance
accounts with FB+NFB exposure of Rs 10 crore and above
was launched in January 2013 and is being upgraded time
Based on the MMRs, the follow up actions are taken for
ensuring expeditious review of accounts, rectification of
irregularities, compliance of terms and conditions in high
value advance accounts for improving the asset quality of
your Bank’s credit portfolio.
Restructuring of Advances Accounts
As a part of an on-going business strategy to improve
upon the quality of advance assets, the Bank reaffirmed
the need to look into the stressed advance portfolio on a
continuous basis, industry-wise as well as borrower-wise,
and to initiate suitable action by way of restructuring as
may deem fit.
During the financial year 2013-14, the Bank undertook
restructuring of various advances accounts as per the table
Restructuring of Advance Accounts (Global) – 2013-14
| (Rs crore)
No. of Borrowers
No. of Borrowers
No. of Borrowers
No. of Borrowers
Economic Intelligence Unit
A specialised Economic Intelligence Unit (EIU) headed by
the Chief Economist and located at the Corporate Office
of your Bank supports your Bank’s Top Management in
several critical areas like Macroeconomic Forecasting,
Investor Relations, Business Strategy Formulation, Asset-
Liability Management, and in discussions/deliberations
with Regulators – domestic and international and Rating
Agencies. The EIU regularly provides the Top Management
of your Bank as well as its operational units a periodic
outlook on key macroeconomic and financial variables
like industrial and infrastructure growth, inflation, interest
rates, stock and debt market movement, sectoral credit
deployment and resource mobilisation of the banking
industry, liquidity conditions, exchange rates, etc.
By providing deep understanding of macroeconomic
aspects, corporate sector health and banking sector policies,
the EIU of your Bank supports the Bank’s efforts in tapping
right kind of business opportunities and swiftly responding
to market dynamics.
The EIU publishes a weekly newsletter (e-publication)
covering weekly macroeconomic developments and policy
highlights to share its perspectives on global and domestic
economic and policy scenarios with investors, bankers,
regulators, rating agencies and other market participants.
This division works as an intellectual arm of your Bank
in comprehending developments that eventually aid the
formulation of rightly aligned strategies.
Internal Control Systems
Your Bank has a well established Central Internal Audit
Division (CIAD) that examines and ensures the adherence to
systems and procedures, policies, directives and guidelines
of the Bank. The directions / instructions and guidelines
received on various issues of internal control from RBI,
Government of India, Bank’s Board, the Audit Committee of
the Board (ACB) and Audit Committee of Executives (ACE)
have become part of the Internal Control System for better risk management.
With the size of business increasing year after year, the
CIAD is continuously and consistently aiming for curbing
the inherent risks through effective control mechanism so
as to safeguard the Bank’s interest.
The CIAD operates through thirteen Zonal Internal Audit
Divisions to carry out the audit of Branches / Offices as per
the periodicity decided by the Audit Committee of the Board
and examines and ensures adherence to such systems of
internal control and risk management.
The Audit Committee of the Board oversees the Internal
Audit function of your Bank. The Committee guides in
developing effective Risk Based Internal Audit, Concurrent
Audit, IS Audit and all other audit functions for improving the
efficiency of systemic controls. The Committee monitors the
functioning of the Audit Committee of Executives and Audit
Division in the Bank.
All the branches of your Bank are covered under the Risk
Based Internal Audit (RBIA). A total of 3,831 branches
were inspected during FY14. Out of these, 2,917 branches
(76.14%) were in Low Risk, 818 branches (21.35%) were
in Medium Risk and 96 branches (2.51%) were in High Risk
The I.S. Audit Cell working under Central Internal Audit
Division, based in Mumbai, conducts the review of IT
operations, applications, infrastructure, I.S. Audit of
branches, etc., and performs the function of Offsite
In line with the guidelines issued by the Department of
Financial Services, Ministry of Finance, your Bank has
implemented the following:
• Audit Committee of Executives has been established
to oversee the work of Central Internal Audit Division
and Zonal Audit Committees with effect from March
2013. This is expected to strengthen further the level
of compliance of systems, procedures and internal
• The Concurrent Audit Policy, Manual and Scoring
Sheets duly approved by Audit Committee of the
Board and Risk Based Concurrent Audit have been
successfully implemented from FY14.
The coverage of Concurrent Audit has been increased to
1,002 branches in 2014-15 from 834 branches in FY14. In
per cent, these 1,002 branches had 70.25% of the Bank’s
total deposits, 82.02% of its total advances and 75.21% of
its total business as on 27.12.2013.
Credit Audit is now being nurtured as a specialized function
within CIAD and the new structure is made operational from
July 2013. During FY14, Credit Audits were conducted in
respect of 4,335 accounts covering the total fund-based
and non fund-based business of Rs 2,62,435 crore, thereby
ensuring increased level of compliance for large-sized loans.
To summarise, your Bank’s Central Internal Audit Division
has been effectively monitoring (on continuous basis) the
compliance of systems and procedures, policies, directives
and guidelines laid down by its own Board, the Regulator
and the Government of India.
Operations and Services
As always, efficient customer service and customer
satisfaction are the primary objectives of your Bank in its
day to day operations. Your Bank is highly responsive to the
needs and satisfaction of its customers, and is committed
to the belief that all technology, processes, products and
skills of its people must be leveraged for delivering superior
banking experience to its customers.
Recently, your Bank has taken several measures to improve
customer service at its branches and at the same time,
strengthen the customer complaint redressal machinery for
fast disposal of customer complaints.
Some of the other major initiatives in improving the customer
service during FY14 are as under.
1. SMS alerts in respect of:
(i) Financial Transactions viz
(ii) Non financial transactions viz
All cheque return transactions irrespective of
- For transactions of Rs 1.00 lakh and above in
Cash Credit Acccount.
- At entry level of transactions for cheque of
Rs 1,00,000/- and above presented in inward
2. Issuance of “Multicity/Payable at par at all branches
in India” cheques to all eligible customers of your Bank.
Change in interest rate in loan accounts due
to change in base rate.
3. Acknowledgement of Form 15G/15H: Branches have
been advised to acknowledge receipt of Form 15G /15H to the depositors to ensure non deduction of TDS
and to eliminate complaints in this respect.
4. To render better customer service, Offline cash
withdrawals up to Rs 15,000/- to Savings Bank
Customers and up to Rs 25,000/- to Current Account
Customers are allowed at your Bank branches where
network connectivity to Data Centre is not available.
5. Revision of cash handling charges: To increase
CASA deposits and to attract high net worth business
clients to your Bank, cash handling charges have been
revised downwards from amount-based charges to
6. “Welcome Kit” comprising of a welcome letter, non
personalized Debit Card and a non personalized cheque
book are being provided to new SB account customers
of your Bank.
7. Customer Meet: Under the direction of Chairman &
Managing Director, customer meets at all your Bank
branches were convened throughout the country on the
same day and at the same time i.e. on 15.07.2013.
8. Banking Codes and Standards Board of India
(BCSBI) Code Awareness Customer Meet: In order
to spread awareness of the Codes of BCSBI among
customers of your Bank, a Customer Meet was
convened by Head Office, Baroda on 6th August 2013.
The meeting was chaired by Chairman of BCSBI and
about 150 customers from various cross sections of
Banking attended the meeting.
9. Printing of nominee’s name in Pass Book/Statement
of Account and FDR, if requested by customer, has
been enabled in the system of your Bank.
Efforts to improve Customer Service at Branches
In your Bank, the feedback on quality of customer service at
branches is obtained through the Branch Level Customer
Service Committee meetings that are held every month in
which customers from various cross sections of the society
are invited including senior citizens and pensioners. The
suggestions/views generated during such meetings are
collated and an appropriate follow-up action is taken to
examine the feasibility to implement the suggestions for
improving the service quality.
Your Bank is focused towards providing excellent customer
service through all delivery channels and has been making
continuous efforts for enhancing the level of customer
satisfaction by leveraging technology to provide e-products
and alternative delivery channels e.g. ATM/Debit cards, POS
(Point of Sale machines), Internet Banking, Mobile Banking,
etc., best suited to the diverse needs of different customers.
The varied interests and expectations of customers are
taken care of by improving upon various processes and
Your Bank is a member of the Banking Codes and Standards
Board of India (BCSBI) and has adopted the “Code of
Commitment to the Customers” prescribed by the BCSBI.
It has also adopted the “Code of Bank’s Commitment
to MICRO and Small Enterprises”. These have been
placed on your Bank’s website and also made available
to its customers at the branches. To create and enhance
awareness of the Code among the customers, the message
to visit your Banks’ website www.bankofbaroda.com /
www.bcsbi.org.in for more details has been incorporated
inside the cover of Saving Bank passbook; as a footnote in
Statement of Accounts and also displayed on the screens
of ATM machines.
Customer Service Committee of the Board
Your Bank has a Sub-Committee of Board for Customer Service which is headed by your Banks’ Chairman and
Managing Director with the following members as on 31st
Shri S. S. Mundra
Chairman & Managing
Shri P. Srinivas
Shri B B Joshi
Shri Ranjan Dhawan
Shri Maulin Arvind Vaishnav
This Sub-Committee addresses the issues relating to the
formulation of policies and assessment of their compliance
which brings about consistent improvement in the quality of customer service. It also monitors the status of the number
of deceased claims pending for settlement beyond 15 days
pertaining to depositors/locker hirers/depositors of safe
custody articles, and reviews the status of implementation
of awards passed by the Banking Ombudsman.
Standing Committee on Customer Service
Your Bank has also set up a Standing Committee on
Procedures and Performance Audit on Customer
Services, comprising of three eminent public personalities
as members along with all the three Executive Directors
and four General Managers of the Bank. This Committee
oversees timely and effective compliance of the RBI
instructions on Customer Service and also reviews the
practices and procedures prevalent in your Bank and takes
necessary corrective steps on an ongoing basis.
The suggestions emanating in the Branch Level Customer
Service Committee meetings are obtained by your Bank’s
Head Office on quarterly basis from Regional Offices and
placed before the Standing Committee on Procedure and
Performance Audit on Customer Services. The feedback
of the committee meetings is then put up to the Customer
Service Committee of the Board of Directors.
Customer-Centric initiatives and Redressal of
- Your Bank has a Board approved policy on Customer
Grievance Redress and the same is placed on the
Bank’s website. Your Bank is also having a well
structured Customer Grievance Redressal Mechanism.
The General Manager in charge of “Operations &
Services, is designated as Nodal Officer for customer
complaints regarding your Bank. Moreover, all zonal
and regional heads of your Bank are designated as
nodal officers for their respective zones and regions.
Furthermore, the names of all nodal officers along with
their contact numbers are displayed in all the branches
of your Bank.
- A quarterly review note on customer grievances is
placed before the Board of Directors giving position of
customers’ complaints received by your Bank.
- To minimize customer complaints and to ensure hassle
free customer service, a regular analysis of complaints
is done on monthly basis and action points / findings
sent to all zonal/regional heads for taking remedial
measures to minimize recurrence of such complaints
- Your Bank is having a web-based online complaint
registration and redressal system in the name of
Standardized Public Grievance Redress System
(SPGRS). An icon has been provided on home page
of your Bank’s website, through which your Bank’s
customer can lodge their complaint online. The system
not only facilitates a speedy redressal of the complaints,
but also enables your Bank to maintain centralized data
base of all complaints.
Recently by making a modification in the SPGRS,
your Bank has provided a facility to lodge complaint/
suggestion to non-customers. Moreover, your Bank’s
customers can re-open their complaints within 15 days,
if they are not satisfied with the redressal.
Systems for KYC-AML-CFT
Know Your Customer (KYC) norms/Anti-Money
Laundering (AML) Standards / Combating of Financing
of Terrorism (CFT) measures and Obligation of Bank
under PMLA, 2002
Your Bank has a Board approved KYC-AML-CFT Policy.
The said Policy is the foundation on which the Bank’s
“implementation of KYC norms, AML standards, CFT
measures and obligation of the Bank under Prevention of
Money Laundering Act (PMLA) 2002” is based. The Bank
issues guidelines to operational units on issues relating
to KYC-AML-CFT issues based on the directives of the
The major highlights of KYC-AML-CFT implementation
across your Bank are as under:
- The Bank generates Cash Transaction Reports
(CTRs) electronically for submission to Financial
Intelligence Unit-India (FIU-IND), through the
- The “AML Solution” for generating system-based
alerts has been installed and implemented. The
scope has been further widened with addition of
more alert definitions as per recommendations of
IBA working group.
- There is a system-based detection and submission
of Suspicious Transaction Reports (STRs) to the
Financial Intelligence Unit-India (FIU-IND).
- System-based Risk Categorization (from AML
angle) of Bank’s customers’ accounts has been
done every half year.
- The Bank files Counterfeit Currency Reports
(CCRs) to FIU-IND, New Delhi.
- The Bank files Non Profit Organizations Transaction
Reports (NTRs) to FIU-IND.
- The Bank is in the process of allotting Unique
Customer Identification Code (UCIC) to all its
existing customers as per RBI guidelines.
- Bank has eliminated 1.32 crore idle customer IDs
from the system.
- Online verification of PAN from NSDL has been
operationalised as a major step to tackle money
- CBS system has been modified suitably not to
accept cash deposits of Rs.50,000/- and above in
absence of PAN / Form No. 60/61.
- Bank is in the final stage of implementation of
e-KYC in collaboration with UIDAI.
- Real-time checking of names from UNSCR list is
available in more than 1800 branches as a step
The full KYC compliance entails Staff Education as
well as Customer Education for which the following
measures are taken by the Bank:
- A comprehensive list of KYC documents is uploaded
on the Bank’s website (www.bankofbaroda.com) for
the benefit of customers.
- Mobile based SMS are being sent and notices have
been published in local and national dailies for
updation of KYC data in accounts of the customers.
- A KYC-AML page is created at the Bank’s
INTRANET for posting reference material on KYC-AML-
CFT education for staff.
- Regular training sessions are conducted on the
KYC-AML-CFT guidelines at the Bank’s training
- Training is being arranged for the Bank’s senior
officials/ executives at RBI, IBA (Indian Banks’
Association) and National Institute of Bank
- Sustained efforts are being made to create
expertise at the Banks’ Head Office for the
Corporate Oversight and also for the KYC Audit
- Regular On-site and Off-site test checking is being
carried out to find out deficiencies and prompt
Your Bank has put in place a Board approved well
documented Compliance Policy outlining the compliance
philosophy of the Bank based upon the directions of
RBI on compliance function in banks. The said Policy is
the foundation on which all compliance function of your
Bank is based. Compliance function in your Bank is an
integral part of governance along with internal control and
compliance risk management process supported by a
healthy compliance culture.
Major Initiatives & Highlights of Compliance
Compliance Department is set up at Bank’s Corporate
Office headed by Chief General Manager reporting to Senior
Management of the Bank.
Apart from qualified staff in the Compliance Department at
corporate centre, each department at the corporate office
and controlling offices as well as branches are having
compliance officers to look after compliance function.
Compliance function ensures observance of statutory
provisions contained in various legislations viz. Banking
Regulation Act, Reserve Bank of India Act, Foreign Exchange Management Act and Prevention of Money
Laundering Act. It also ensures Standards and Codes
prescribed by BCSBI (the Banking Codes and Standards
Board of India), IBA (Indian Banks Association), FEDAI
(Foreign Exchange Dealers’ Association of India) and
FIMMDA (the Fixed Income Money Market and Derivatives
Association of India).
In order to keep the compliance staff up-to-date with
developments in the areas of banking laws, rules and
standards, regular and systematic education, knowledge
management tools have been uploaded on the Bank’s site
Back Office Operations
Regional Back Offices and City Back Offices
Your Bank is having 12 Regional Back Offices (RBOs) at
present with two RBOs opened during the year at Bareilly
and Ahmedabad. One more RBO at Hyderabad is in
advanced stages for a roll out, in order to have one RBO
per zone for processing of CASA account opening forms
and issue of Personalised cheque books. More than 4,200
branches of your Bank are linked for centralised account
opening process through RBOs and more than 4,350
branches are linked for issuance of Personalised cheque
Your Bank is having 85 centralised city back offices for
processing of inward and outward cheques through clearing.
During the year under review, 100.0% migration to CTS
(Cheque Truncation System) clearing has taken place in
Southern Grid and also at all the 20 MICR (Magnetic Ink
Character Recognition) locations of the Western Grid.
Government Business & Currency Chest
Your Bank focused on Government Business in a dedicated
fashion during FY14 to augment its fee-based income. Some
of the major initiatives taken during the year under review
are listed below.
- Your Bank obtained permission for “State Tax Collection”
in the states of Dadra & Nagar Haveli, Delhi (offline),
Mizoram, Nagaland, Andhra Pradesh & Meghalaya.
With this, your Bank is authorized to accept State Tax Collection in 19 States.
- Your Bank obtained permission from Ministry of
Railways for disbursement of Railway Pension in 11
States i.e. Maharashtra, West Bengal, Assam, Bihar,
Nagaland, Tamil Nadu, Manipur, Tripura, Sikkim,
Mizoram and Arunachal Pradesh.
- Your Bank obtained authority for additional 166 branches
for undertaking Public Provident Funds / Senior Citizens
Savings Scheme (PPF/SCSS) Business. With this,
around 1,079 branches of your Bank are authorized to
undertake PPF/SCSS business.
- Your Bank undertook special campaign for the
mobilization of PPF with effect from 1st January, 2014
to 31st March, 2014. A total of 44,740 accounts were
mobilized during the campaign period and 64,072
accounts during FY14 as a whole.
- Your Bank also undertook special campaign for the
mobilization of NPS Lite under New Pension Scheme
during the period from 2nd December, 2013 to 31st March,
2014 and more than 23,800 Accounts were mobilized
during the campaign period and more than 25,000
Accounts during FY14 as a whole.
- Your Bank received permission for e-stamping facility
in the states of UP & Uttarakhand and activated 48
branches in UP & 17 branches in Uttarakhand. With this,
your Bank’s 113 branches in six states are authorized
to conduct e-stamp business.
- Your Bank obtained authorisation from Ministry of
Commerce & Industries for participation in their e-Biz
portal to provide online collection of license fees and
charges collected for issuance of various types of
- Your Bank implemented physical collection of Customs
Duty at Inland Container Depot (ICD) Kribhco & Hazira
and started collection of Customs Duty at both the
- In Andhra Pradesh, your Bank obtained approval from
Geological & Mining Department for Royalty collection
through Cyber Treasury.
- In the State of Gujarat, your Bank got authorization to
collect MST & Entry Tax and also to handle six additional
Sub Treasuries business.
New Pension Scheme (NPS)
After launching of NPS-Lite Scheme on 14.09.2012, your
Bank canvassed 20,872 applications up to 31.03.2013
and 23,646 applications during the financial year ended
31.03.2014 under the NPS-Lite Swavalamban scheme. Your
Bank has set a target for canvassing 1,00,000 applications
under the NPS-Lite Swavalamban scheme during the
financial year 2014-15.
Cash Management & Currency Chest
1. Your Bank managed to maintain average Cash Deposits Ratio (without ATM Cash) at 0.30 or below by constant
monitoring and follow up with the zones and regions.
2. Clean Note Policy: To comply with Clean Note Policy
of RBI, your Bank procured 1,354 NSMs in the 1st
phase for its branches and currency chests in FY14 and
procurement of 3,682 NSMs for rest of the branches
is under way.
3. Proposed New Currency Chests: As a customercentric
initiative to improve the payment system, your
Bank identified 32 currency chests to be opened during
the period, thereby increasing total number of currency
chests from 84 to 116, out of which three currency
chests, notably at Dhamnod, I.E. Varanasi, Rahangi,
were opened during the year 2013-14.
4. Coin Vending Machine: As per the “Strategic Plan
on Currency Management 2011-14”, 30 Coin Vending
Machines have been installed at different places during
Name of the Zone
Bihar Orissa & Jharkhand
Greater Mumbai Zone
North Gujarat Zone
South Gujarat Zone
Maharashtra & Goa Zone
MP & Chhatisgarh Zone
Karnataka & AP Zone
Tamilnadu & Kerala Zone
Eastern UP Zone
||WUP & Uttarakhand Zone
Vigilance in your Bank aims at identifying leakages within
the organization that lead to financial loss and, taking
corrective and preventive actions to plug these leakages
and simultaneously ensuring proper justice and fair play in
the organization. Thus, this helps in protecting the innocent
employees by supporting quality decisions, while striving to
bring the real offenders to book thereby eliminating forces
that thwart integrity and preventing loss for your Bank.
With the objective of bringing awareness among the
staff members about preventive vigilance and also to put
forth consequences of flouting the rules and regulations,
which may lead to perpetration of frauds by unscrupulous
elements, sensitive branches of the Bank are identified
on the basis of risk perception and Preventive Vigilance Audits are conducted. The staff members are sensitized
about preventive vigilance through vigilance newsletter,
circulars, meetings etc. Other initiatives are also being
taken such as implementation of Bio-metric authentication
in CBS, online submission of Property Returns by officers
and putting Immoveable Property Returns of Executives on
your Bank’s website.
Your Bank has also created a pool of trained officers for
skilled investigation and expeditious conduct of enquiry
proceedings. It may be noted that there was significant
improvement in disposal of disciplinary action during the
As a part of increasing transparency in the processes and
systems, stress is being put on leveraging technology in the
customer service areas as well as the internal monitoring
systems viz. online applications, submissions, services etc.,
wherein minimum manual intervention is required.
The Vigilance machinery is effectively performing its role
as decision facilitators rather than decision deterrent by
strengthening the systems and procedures, plugging
the loopholes, wherever found and erasing grey areas.
It is imparting participative, proactive and preventive
mechanisms to meet the desired impact.
Given below are the details of your Bank’s major
achievements on the business front during FY14.
Resource Mobilisation and Asset Expansion
The share of Bank’s Deposits in total resources stood at
86.26% as of 31st March 2014. Total Deposits of your
Bank grew from Rs 4,73,883.34 crore to Rs 5,68,894.39
crore, posting a healthy growth of 20.05% over the previous
year. Of this, Savings Bank Deposits – a critical component
of Low-Cost Deposits grew by 14.39% from Rs 84,302.61
crore to Rs 96,437.44 crore.
The share of low cost deposits (Current + Savings) or
CASA deposits in Total (Domestic + Overseas) Deposits
was at 25.75% and in Domestic Deposits at 31.76%.
Your Bank’s Total Advances expanded by 20.97% during
FY14 led by 21.34% expansion in Domestic Advances and
20.16% expansion in Overseas Advances.
Composition of Funds – Global
Particulars (Rs crore)
End March 2013
End March 2014
Global Advances (Net)
Particulars (Rs crore)
End March 2013
End March 2014
To bring more synergy between business models
persuaded by your Bank and its organizational structure
promoting the corporate goals, a new business vertical
“Deposit Resources” was created during the year. The
aim of this newly created vertical has been to ensure a
consistent and broad based growth in CASA and Retail
We are happy to share that your Bank canvassed 79,87,709
new Savings Bank accounts and 1,20,082 new Current
accounts during the year under review.
Sale of Gold Coins
Around 40,145 Gold coins of different denominations
aggregating 362.333 Kgs were sold during the year FY14.
Initiatives undertaken by “Deposit Resources”
Product modification in Baroda Premium Current
Account (BPCAP): Your Bank effected a flexibility in sweep
period ranging from 15 days to maximum 91 days during the
year. The customer would now enjoy an option to decide
sweep period within the specified range depending upon
his/her requirement of funds. The rate of interest on short
deposits is to be for the period as per the option given by
customer as per the Bank’s ROI prevalent from time to time.
Other Business initiatives
Drive for activation of dormant accounts: To revive &
strengthen the relationship with existing customers, a
drive was launched by your Bank for activation of dormant
Drive for Issuance of Debit Cards: As a part of your Bank’s
CASA campaign and to promote the use of debit card, a
drive was launched to cover maximum customers during
the campaign period.
CASA Campaign: To accelerate growth in low cost
deposits, notably, the Current and Savings Bank Deposits, a
CASA campaign was launched from 2nd September 2013 to
25th September 2013. An amount of Rs 696 crore (retained
amount) as fresh Savings Bank Deposit was mobilized in
15,01,679 new Savings Bank accounts and total savings
deposit of Rs 1,402 crore was mobilized during the campaign
period. An amount of Rs 230 crore was mobilized in 25,426
new Current accounts and a total Current Deposit of Rs 777
crore was mobilized. Total CASA deposit of Rs 926 crore in
new accounts and in overall, an amount of Rs 2,179 crore
in both Savings and Current Account was mobilized during
the campaign period.
Savings Bank Deposit Campaign: To accelerate the pace
of mobilization of Savings Bank deposit, a campaign for
Savings Bank deposit was launched from 17.02.2014 to
22.03.2014. An amount of Rs 1,093.66 crore in 8,69,945
new savings bank accounts was mobilized with overall
increase of Rs 1,765.31 crore in savings bank deposits. The
average balance in newly opened SB accounts amounted
to Rs 12,571/-.
The NRI (Non-Resident Indian) deposits are important
resources, which your Bank has been successfully tapping
over the years.
New Products Launched
In pursuance to the important measures announced by the
RBI during August-September 2013 to augment inflow of
NRI remittances from abroad, two special Retail Liability products styled as “Baroda Premium FCNR (B) deposit”
and “Baroda Ultra Premium FCNR (B) deposit” were
introduced on 23rd September, 2013 and 10th October, 2013,
respectively. The funds mobilized under these products
facilitated your Bank to participate in concessional Dollar
SWAP window of the RBI. Keeping in line with the closure
of SWAP window of RBI on 30th November, 2013, the
special deposit products were closed on 27th November,
2013. Your Bank mobilized deposit of USD 42 million and
USD 1,694 million, respectively and swapped with the RBI
for an amount of USD 1.7 billion.
New Inward Remittance Processed
The Process has been initiated for launch of new inward
remittance product Flash Remit under tie up arrangement
with UAE Exchange Centre LLC (UAEECL) under rupee
drawing Arrangement of RBI. As of now, Supplemental
Agreement document is ready to be signed with UAE
Exchange LLC, Abu Dhabi, UAE for the new online
Special NRI Deposit Campaign
Coinciding with the launch of two new FCNR (B) products,
special campaign for NRI deposit was launched between
14th Oct, 2013 and 30th Nov, 2013 across all branches with
a special focus on top 500 NRI centric branches. Against
a target of Rs 1,508 crore, your Bank could register a net
increase of Rs 1,600 crore in this period. During the special
drive, about 12,967 new accounts with an inflow of Rs
10,512 crore were opened.
Centralized NRE/NRO SB a/c extended to all
Centralized opening of NRE/NRO SB accounts in NRI Back
Office (NROBO), Mumbai, was extended to all overseas
territories for sponsoring the accounts opening applications
from July 4, 2013. Total number of 5,538 NRE/NRO SB
accounts was opened during the year with sponsored
application received from your overseas branches,
subsidiaries and joint ventures on behalf of the domestic
- Your Bank vigorously followed up with NRIs and
assisted branches in cleansing database for KYC
compliance under the RBI observation.
- Your Bank initiated efforts for rejuvenation of Dormant
Wholesale & Mid Corporate Banking
Your Bank’s Large and Mid Corporate segment collectively
contributes more than 50% of its domestic credit portfolio.
The FY14 was a challenging year for the Indian banking
sector as elucidated in the earlier section on Economic Scene
in FY14. Given below are some of the specific challenges
faced by the Bank’s Corporate Lending division during FY14.
i) Credit demand from corporates remained subdued for
a number of reasons such as
ii) Balancing between lending appetite and worsened
- Lowest GDP growth rate in a decade.
- Delayed Policy/administrative decisions on various
- Specific delays in clearance of infrastructure
projects for different reasons.
- Uncertain policy environment
- High input price inflation & interest rates
- Volatile exchange rate movement in H1, FY14
Against this backdrop, your Bank has been cautious and
careful in garnering new business/ sectors for augmenting
credit growth. Yet, the fast track desk of your Bank
established 146 new relations during FY14. Its Large and
Mid Corporate segments accorded fresh sanction/ increased
credit facilities to the tune of over Rs 96,000 crore during
The objective of “harnessing growth in corporate credit”
through creation of Corporate Financial Services branches
and Mid Corporate branch model, has been successful.
Together, these branches have contributed nearly Rs
1,00,000 crore of assets representing 36% of your Bank’s
outstanding domestic credit.
While according credit sanctions, your Bank continued to
ensure the benchmark of due diligence, appraisal standard,
compliance and governance to maintain the asset quality.
Total non food gross advances of your bank registered
a growth of 21.88% from Rs 2,24,035.82 crore (as on
31.03.2013) to Rs 2,73,060.13 crore (as on 31.03.2014).
The growth in credit of your Bank was higher than the
Innovation & new initiatives are the hallmarks of progress
in any industry. Your Bank’s Large Corporate and Mid
Corporate departments also undertook the following novel
initiatives during FY14.
Your Bank’s “human capital” has been playing a crucial role
in accomplishing the aforesaid objectives. Recruitment of
professionals viz. CA/ ICWA/ MBA was made during the year
FY14 to replenish & reinforce the stock of human capital.
It may be noted that your Bank focused on grooming of
its credit & FX officers by according it the topmost priority.
- A new product christened as “Top Up Facility” was
introduced looking to the requirement of timely
sanction of working capital requirements for the
- Features of existing products were reviewed and
revisited to make more competitive. The products
included Corporate Loan, Bid Bond Guarantee,
Loan Against Future Rent Receivables etc.
- Interest rate structure was rationalized to make it
one of the best in the industry.
- As a strategic business decision, your Bank’s
Project Finance Department was hived off
and merged with Baroda Capital Markets Ltd.
Baroda Capital Markets Limited will now carry
out Techno Economic Viability Studies of the
projects, arrange funds for Corporates by way of
Syndication of Bank Loans etc. Baroda Capital
Markets Ltd has a dedicated team of professionals
comprising Engineers, Finance Professionals,
and experienced groomed credit officers. Another
objective was also to augment their fee income
through extending project appraisal services in
the market to undertake TEV study of projects.
- Turnaround time of credit delivery was significantly
Retail banking services continued to remain an important
business division of your Bank in FY14 as well. This division
focuses on meeting the financial needs of personal and small
business customers (traders) who are looking for accessible
and affordable banking services.
The performance of your Bank’s Retail banking division
during the year under review is as under.
Growth under Retail Lending
Your Bank’s Retail Loan Book consists of five key products
viz. Home Loan, Auto Loan, Education Loan, Traders Loan
and Mortgage Loan, which constituted 79.31% of total Retail
Loans as at end-Mar, 2014. The other products namely
LABOD/ODBOD constituted 17.91% of the Bank’s total
The other retail loan products like Baroda Personal Loan
and other miscellaneous products viz. Doctors Loan, Loan
against Government securities etc., constituted 2.8% of
Total Retail Loans stood at Rs 46,019 crore as on 31st
March, 2014 as against the level of Rs 38,046 crore as
on 31st March, 2013. Absolute growth of Rs 7,973 crore
(21.0%) was registered during FY14 as against a growth
of Rs 2,379 crore (6.7%) during the previous financial year.
Growth under Five Key Retail Products
Under five key products which constituted 79.3% of total
Retail Loans, an absolute growth of Rs 5,899 crore (19.3%)
was posted during FY14 as against Rs 4,412 crore (16.9%)
Home Loans: Absolute growth of Rs 3,513 crore (21.9%)
was registered during FY14 as against a growth of Rs 1,911
crore (13.5%) during FY13.
Auto Loans: Absolute growth of Rs 698 crore (23.7%) was
registered during FY14 as against a growth of Rs 512 crore
(21.1%) during FY13.
Baroda Traders Loans: Absolute growth of Rs 1,215 crore
(16.9%) was registered during FY14 as against a growth of
Rs 1,620 crore (29.1%) during FY13.
Baroda Mortgage Loans: Absolute growth of Rs 367 crore
(14.9%) was registered during FY14 as against a growth of
Rs 284 crore (13.0%) during FY13.
Education Loans: Absolute growth of Rs 106 crore (5.4%)
was registered during FY14 as against a growth of Rs 86
crore (4.6%) during FY13.
NPAs under Retail Loans
The amount of Non Performing Assets (NPA) as on 31st
March, 2014 against your Bank’s Retail loans stood at Rs
901 crore (1.96%) as against the same level but a higher
per cent of 2.11% as on 31st December, 2013. The amount
of NPA as on 31st March, 2013 under Retail Loans was Rs
669.08 crore or 1.76% of gross retail loans.
Initiatives in Retail Banking During FY14
1. New Products Launched
A new Retail Asset product named as Vehicle Loan
Scheme for your Young Officers & Clerical Staff
was launched on 10th April, 2013 for purchase of four
and two wheelers, with maximum limit of Rs 3.50 lakh
and Rs 0.75/0.60 lakh, respectively. Another new
asset product styled as Baroda Traders Gold Card
scheme was also launched on 30th April, 2013 for the
existing Baroda Traders Loan borrowers. New Retail
Loan product “Baroda Premium Personal Loan” to
Salaried Employees with a maximum limit of Rs 10 lakh
was launched on 1st November, 2013. New Car Loan
scheme ‘Baroda Car Loan to NRI/PIO’ was launched
on 4th December, 2013. Special Education Loan for
students of Asia Pacific Flight Training Academy
was launched on 9th October, 2013. Special Traders
Loan Scheme for Iron and Steel Traders in NCR
was another new product to the kitty of new products
launched during the year.
2. Product Modification
During the year, your Bank modified Baroda Additional
Assured Advance (AAA), a Top-up Home Loan Product,
by increasing the maximum limit from Rs 0.25 crore to
Rs 2.00 crore in addition to adding new features in the
scheme to facilitate more home loan borrowers to avail
the scheme. Maximum limit was also increased in the
existing product for traders ‘Baroda Traders Loan’
from Rs 2 crore to Rs 3 crore for Semi-urban and Rural
Branches and to Rs 4 crore for Metro/Urban branches
and under Baroda Mortgage loan from Rs 1 crore to Rs
The rates of interest were rationalized and made
attractive for various products like Baroda Housing
Loan, Loan against Future Rent Receivables,
Baroda Mortgage Loan, Baroda Education Loan and
Loan/Overdraft against Bank’s own Fixed Deposit
Receipts, during the course of the year FY14.
3. Other Business Initiatives
- Your Bank regularly disseminated information
amongst its employees on various retail product
features, which included products like Home Loan,
Traders Loan, Auto Loan, Education Loan and
Mortgage Loan, etc. Your Bank published a booklet
(in both Hindi and English) entitled as ‘Retail Loan
Guide Ready Reckoner’ for its staff members.
- Loan Campaigns were undertaken at different
points of time to boost the retail business. The
products for which such campaigns were undertaken
were - Additional Assured Advance (AAA), Future
Rent Receivables and Baroda Traders Loans,
Education Loans, Mortgage Loans, Auto Loans,
Baroda Home Loans, Baroda Traders Loans, etc.,
which helped in increasing the Bank’s overall retail
- Your Bank strengthened the Tie-up arrangements
with Maruti Suzuki Ltd & others like Mahindra &
Mahindra, Tata Motors, Force Motors and Honda
Cars India Ltd.
- Your Bank opened five New Retail Loan factories
(RLFs) at Bharuch, Junagarh, Visakhapatnam,
Meerut & Moradabad taking the total strength of
RLFs to 45.
- Your Bank’s Regions were actively involved in
Organization of Property and Car Expositions as
well as participation in local trade fairs as a business
- The initiative to send SMS messages/reminders to
retail Loan borrowers led to significant improvements
in recovery in these accounts.
Wealth Management Services
In order to cater to the various investment needs of its
customers, apart from seamless banking, your Bank is
offering Wealth Management Services since the past
ten years. For this, your Bank has entered into tie-up
arrangements with various companies for offering products
like Life Insurance, Non-Life Insurance, Mediclaim, Mutual
Fund, Online trading etc. The two JV (Joint Venture)
companies of the Bank, one in Life Insurance and the other
in Mutual Fund business, is showing steady growth over
the years. Apart from distributing the products of these
companies, the products of tiup partners are also being
distributed through the Bank’s pan Indian branches.
In order to offer more qualitative Wealth Management
Services to the customers, your Bank has enabled India
First Life Insurance’s (IFLI) renewal Insurance premium
collection through ATMs and fund collection module for
Baroda Pioneer Mutual Fund. On the occasion of your
Bank’s 106th foundation day, the Bank’s Chairman and
Managing Director unveiled IndiaFirst Health Card. This
card is introduced with a view to provide cash less benefits,
to the card holder, at empanelled hospitals through Point
of Sale (POS) Machines.
During the year FY14, your Bank gave added focus to the
installations of POS machines at Merchant establishments
with a view to improve its Current Account portfolio. This
indeed generated good results and your Bank doubled its
POS numbers in a year’s time across the Merchant locations.
Apart from the E-Trading tie up with India Infoline Ltd., your
Bank, through its wholly owned subsidiary BOB Capital Market Ltd., is offering Online Trading Facility (OLT) –
Bobetrade- to its customers. A modified trading platform
with added features is going to be launched soon which will
help your Bank in attracting and retaining its retail customers.
As a “Self Certified Syndicate Bank” (SCSB) by SEBI, an
additional mode for applying in IPO/FPO/Right Issues and
NFO of Mutual Funds is made available by your Bank in
the form of Application Supported by Blocked Amount
(ASBA) to all category of investors who are customers of
your Bank. Your Bank has enabled 655 centres for accepting
Syndicate ASBA applications.
Your Bank is always committed to provide more personalised
services to ensure customer delight and will move forward
in the same direction in the years to come.
The micro, small and medium enterprise (MSME)
sector is crucial to India’s economy. A recent IFC study
on MSME finance in India indicates there are 29.8 million
enterprises in various industries, employing 69 million
people. This sector accounts for 45% of Indian industrial
output and 40% of exports. Although 94% of micro, small
and medium firms are unregistered, the contribution of the
sector to India’s GDP has been growing consistently at
11.5% annually, which is much higher than the average
GDP growth of the nation.
Considering the importance of the MSME sector to
Indian economy and to facilitate this business, your Bank
rationalized interest rate structure for MSME borrowers
in June 2013. Your Bank comfortably achieved all the
regulatory targets pertaining to this segment during FY14.
Moreover, your Bank has a rich set up of 52 SME Loan
Factories (SMELFs), which sanctioned loans to the tune
of Rs 19,999 crore during the financial year under review.
In addition to the MSME units under the regulatory
category, your Bank also considers financing the units in
manufacturing and services activity which have investments
in plant & machinery and equipments, respectively, in excess
of regulatory guidelines and have turnover up to Rs 150 crore on the same footing as MSME units. This is done
internally to give preferred attention to this “expanded” sector
along the lines of regulatory MSME enterprises.
However, for reporting to regulators, the performance of
your Bank is reckoned on regulatory lending i.e. to units/
borrowers who comply strictly with definition of Micro, Small
and Medium Enterprises.
It may be noted that during the year FY14, the performance
of your Bank under the regulatory category of MSME
business has been very encouraging despite the overall
slow-down in the economy.
Growth of MSME Business
The total outstanding in MSME Sector works out to Rs
57,426 crore as on 31st March 2014. The growth in lending
to MSME Sector during the last three years is given in the
Growth (%, YoY)
Major Achievements in FY14
- The MSME advances of Rs 56,634 crore as of
end-Mar 2014 reflected a growth of Rs 9,912 crore
(21.21%) over the MSME advances in the previous
- The advances of Rs 27,756 crore to Micro
Enterprises in the total credit of Rs 40,873 crore
to MSE sector (as of the previous year) stood
at 67.90% in FY14, comfortably reaching the
mandatory target of 60.0% fixed by the RBI.
- The MSME advances as on 31st Mar, 2014
contributed 20.16% to the gross domestic advances
of your Bank.
- The advances to Micro & Small enterprises
reached the level of Rs 50,300 crore as against the Government set mandatory target of Rs 45,900
crore by end-Mar, 2014.
- Your Bank introduced a New Product named as
“MSME Capex Loan and Capex Card” during FY14
to further promote its MSME business.
Initiatives in MSME Financing during FY14
- Your Bank reduced the spread in the rate of interest
charged to the MSME borrowers to encourage
- Your Bank approved scoring type credit rating
model for small value loans worth Rs 2 lakhs up
to Rs 2 crore.
- Your Bank held the SME conclave with Heads of
SME Loan Factories in the months of June and
October 2013 to deliberate on the issues pertaining
to MSME businesses.
- Your Bank celebrated MSME Festival from 1st
November 2013 to 28th February 2014.
- Your Bank arranged MSME Round Table conference
at Nasik, Indore, Rajkot and Coimbatore.
- Your Bank aggressively focused on collateral free
lending under the CGTMSE scheme.
- Your Bank participated in several exhibitions,
seminars, etc., to build its Brand image.
Besides this, your Bank introduced MSME CAPEX LOAN
and CAPEX CARD for MSME borrowers. It financed units
in Hosiery industry in Kanpur Region and leather & leather
products in Kanpur and Agra regions. It financed Tea
Processing units in West Bengal and Sikkim regions. It
extended financial support to units engaged in Rerolling
mills, Machine Tools and Textile printing activity across the
country. It financed units engaged in manufacturing of Hand
Tools & Sports goods in Punjab-Jamu-Kashmir Region. It
financed Hotel/Motel/Resorts in Haldwani and Deharadun
regions. It financed agro-based units across the nation. It
entered into MOU with Mahindra Trucks & Buses P. Ltd.
under its scheme for financing Road Transport Operators for
purchase of commercial vehicles manufactured by various
commercial vehicle manufacturers. It also entered into MOU
with Development Commissioner, MSME for Technology
up-gradation and for providing quality support to MSMEs
with respect to energy efficient projects.
Under its MSME segment, your Bank has various Area
Specific Schemes for certain pockets, where there is a
concentration of units with same or similar activity and with
good business potential. These schemes have yielded
satisfactory results for your Bank. The cluster development
is also being undertaken with lead district branches having a
larger role to play in the ensuing year. Furthermore, directed
programmes of the Government of India, particularly the
Weavers Credit Card (WCC) and lending under Prime
Minister’s Employment Generation Programme (PMEGP)
received focused attention during the year FY14.
In particular, your Bank renewed the following area-specific
schemes during the year FY14.
- Financing of Marble units in Rajasthan.
- Financing of Textiles units on pan India basis.
- Financing of Brass Manufacturing Units in
Jamnagar, Junagadh & Kutch Region.
- Financing of collateral free loans/educational
loans to persons with disabilities promoted by
National Handicapped Finance and Development
- Financing of three-wheelers manufactured by
Piaggio Vehicles Pvt. Ltd.
Rural and Agricultural Lending
Your Bank has always been a frontrunner in the area
of Priority Sector and Agriculture lending. It has been
harnessing the vast potential of the rural market through its
wide network of 1,781 rural branches and 1,267 semi-urban
branches. Even during FY14, your Bank opened 453 new
branches in rural and semi-urban areas.
Your Bank is the proud Convener of State Level Banker’s
Committee (SLBC) in the states of Uttar Pradesh
and Rajasthan. Your Bank shoulders the Lead Bank
Responsibility in 48 districts in the states of Gujarat (14),
Rajasthan (12), Uttar Pradesh (15), Uttaranchal (2), Madhya
Pradesh (2), Bihar (2) and Delhi (1).
Your Bank has sponsored three Regional Rural Banks
(RRBs) in three states with a network of 1,659 branches
and total business of Rs 33,169.55 crore as of March, 2014.
Performance of Priority Sector Lending in FY14
Priority Sector Advances of your Bank surged from Rs 80,003
crore as on March 2013 to Rs 90,488 crore as on March
2014 and formed 40.02% of the Adjusted Net Bank Credit
(ANBC) against the mandated target of 40.00%. The Direct
Agriculture advances of your Bank increased to Rs 22,117.51
crore over the previous year with an absolute growth
of Rs.1,609.39 crore (7.85%) during the year. The total
agriculture advances of your Bank has grown by Rs 768.76
crore and reached Rs 28,431.92 crore as at end-March 2014.
The growth remained marginal due to the impact of revised
guidelines of Priority Sector Lending issued by Reserve
Bank of India made applicable from July 20, 2012 which
led to reclassification of a large number of accounts out of
Agriculture. Your Bank’s Direct Agricultural advances formed
9.78% of ANBC as of March 2014 against the mandated
target of 13.50%. The Total Agricultural Advances were at
12.57% of ANBC against the mandated target of 18.00%
(Recent guidelines of RBI dated 15.05.2014 would increase
the Total Priority Sector and Total Agriculture Advances to
41.22% and 13.93% respectively).
Under its flagship agriculture loan product “Baroda Kisan
Credit Card (BKCC)”, your Bank issued as many as
2,47,796 Credit Cards during FY14 to provide credit to farmers across India. Baroda Kisan RuPay Card, an ATM
enabled smart Card, has been issued to 3,30,257 BKCC
holders for their convenience. Your Bank financed as many
as 2,95,743 new farmers during FY14 granting them loans
worth Rs 4,505.55 crore.
As a part of its microfinance initiatives, your Bank
credit linked 11,908 Self Help Groups by granting loans
amounting to Rs 198.03 crore during FY14 thereby taking
the total number of SHGs credit linked to 1,83,566 with an
outstanding loan amount of Rs 1,670.57 crore.
Business and Social Initiatives
Your Bank undertook various initiatives during FY14 to
harness the emerging opportunities in rural and agriculture
lending. Some of them are mentioned below.
- To augment the Agriculture advances, your Bank
conducted special campaigns viz. Kharif and Rabi
campaign for crop loans under which the disbursements
of Rs 5,585.67 crore and Rs 2,850.40 crore, respectively,
were made. Another Campaign for Investment Credit
was also undertaken, in which disbursements of Rs
897.84 crore were made.
- Your Bank has identified 466 Thrust Branches across
India to boost Agriculture lending. These branches
contributed 35.95% of the total Agriculture outstanding
of the Bank as at 31st March 2014.
- Your Bank formulated various Area-specific Schemes
which are tailor-made to cater to the needs of the
local farming community, with various freebies like
concessions in rate of interest & charges etc. Twelve
such schemes to accommodate the varied needs of
farmers were approved and implemented during the
year under review.
- Your Bank launched Agriculture Loan Factories for
bettering customer service and improving the volume
and quality of the Bank’s agriculture advances. Three
such pilot factories have started functioning in Mehsana
in Gujarat, Bareilly in U.P and Muzaffarpur in Bihar.
- At present, your Bank has 47 Baroda Swarojgar Vikas
Sansthan (BSVS), Baroda R-SETI Centers across India training the youth and imparting them knowledge and
skills required for taking up self-employment ventures.
During FY14, around 33,974 youth beneficiaries were
trained at these centres, out of which 22,297 have
established self-employment ventures. Out of the total
1,92,247 beneficiaries trained by these centers so far,
1,20,979 have successfully taken up their own self
- Your Bank has established 46 Financial Literacy
Centres (FLC) across India, christened as “SARATHEE”
to impart financial literacy and credit counseling services
to the needy to help them avail financial services from
the banking system and also to provide counseling
services to those under financial distress. Your Bank
has opened these centers under the patronage of its
BSVS Trust and free services are provided to all by
- Your Bank has also opened a Micro Loan Factory at
Raebareli and Sultanpur in U.P. The Micro Finance Loan
Factory has a mobile van with facilities and all related
documents on SHG financing. It is manned by officers
who are duly authorised to sanction and disburse loans
up to Rs 25,000 to SHGs on the spot and at their door
Performance of RRBs Sponsored by your Bank
At present, there are three RRBs sponsored by your Bank:
• Baroda Uttar Pradesh Gramin Bank, Head Office:
• Baroda Rajasthan Khetriya Gramin Bank, Head Office:
• Baroda Gujarat Gramin Bank, Head Office: Bharuch.
The aggregate business of these three RRBs rose to
Rs 33,169.55 crore as of March, 2014 from Rs 29,284.23
crore as at end-March, 2013, registering a growth of 13.27%.
These three RRBs together posted a Net Profit of Rs 289.40
crore during FY14 as against Rs 97.06 crore earned during
The “Net Worth” of all these RRBs put together improved
from Rs 1,234.42 crore at end-March, 2013 to Rs 1,523.82
crore at end-March, 2014 and their “Reserves and Surplus”
improved from Rs 777.52 crore at end-March, 2013 to
Rs 1,066.92 crore at end-March, 2014, respectively.
Advances to SC/ST Communities during FY14
The outstanding advances granted by your Bank to SC/ST
communities have been growing healthily year after year.
This is evident from the fact that the outstanding advances
granted to these beneficiaries went up from Rs 4,712.66 crore
as at end-March, 2013 to Rs 6,160.30 crore as at end-March,
2014. In fact, the SC/ST communities accounted for a share
of 29.90% in the total advances granted to weaker sections
by your Bank during the year under review. Furthermore,
a special thrust is laid by your Bank in financing SC/ST under various government sponsored schemes namely
National Rural Livelihood Mission (NRLM), Swarna
Jayanti Shahari Rojgar Yojana (SJSRY), Prime Minister
Employment Generation Programme (PMEGP), etc.
Baroda Swarojgar Vikas Sansthans (BSVS) have also
been giving due preference to SC/ST communities while
selecting the trainees. It is heartening to indicate that so
far, these centres have trained 72,365 youths under the
Bank’s Committed Efforts at Financial
Financial Inclusion is delivery of banking services at an
affordable cost to the vast sections of disadvantaged and
low income groups. The Financial Inclusion Plan aims at
providing easy access to financial services to those sections
of the society who are deprived of it so far at affordable
cost thereby bringing them into the mainstream financial
sector. Implementation of Financial Inclusion is not a new
concept for your Bank. Financial Inclusion activities are
being implemented by your Bank since inception through
various government-sponsored programmes, lending to the
poorest of the poor, lending to the minority communities,
lending to SC/ST, lending to priority sectors, etc. However,
the RBI formalized the concept of Financial Inclusion in
2005, when it permitted rendering of banking services
through Business Correspondent (BC) channel. It then
advised all commercial banks in the year 2010 to submit
Board-approved Plan for providing banking services in
rural unbanked areas under Financial Inclusion.
As desired by Government of India and directed by
the RBI, your Bank’s Board had approved a Financial
Inclusion Plan (FIP) for implementation by your Bank
within a period of three years commencing from 2010-
11. The plan had envisaged covering 20,000 villages in
a span of three years under Financial Inclusion utilizing
various technology based initiatives. Thereafter, Ministry
of Finance and RBI advised your Bank to cover the
villages having population above 2,000 by March 2012.
Accordingly, your Bank was allotted 2,855 villages which
are covered well within the timelines.
Thereafter, the RBI advised all banks to provide banking
services to all villages within the service area of the specific
bank in three years i.e. 2013-14 to 2015-16. Accordingly,
your Bank’s Board approved disaggregated FIP for all 21,526
service area villages of the Bank to be covered in three years,
i.e., up to March 2016. As per the Board approved FIP, the
year-wise target for coverage of service area villages is
11,124, 16,324 & 21,526 during 2013-14, 2014-15 & 2015-16,
respectively. Your Bank has already surpassed the annual
target of village coverage well ahead of its timeline. Almost
all other parameters of Annual Targets set in disaggregated
FIP for March 2014 have also been achieved.
Models used by your Bank for FI
Your Bank has adopted various models for providing banking
services under financial inclusion such as:
ICT (Information & Communication Technology) based
- BC model
- POS (Point of Sale/Service)
- Mobile Van
- Brick & Mortar Branches
Information and Communication Technology (ICT)
based Business Correspondent (BC) model: POS based
This solution is based on Application Service Provider
(ASP) model with smart cards based technology for financial
inclusion. Under this model, Business Correspondents are
appointed by banks through service providers who are
provided with point-of-service (POS) devices, using which,
they carry out transactions for the smart card holders at their
doorsteps. The customers can operate their accounts using
their smart cards through biometric authentication. In this
system, all transactions processed by the BC are online real
time basis in CBS of the bank. The POS devices deployed
in the field are capable to process the transactions on the
basis of a Smart Card, Account number (card less) and
Aadhaar number (AEPS transactions). The BC is moving
into the cluster of villages allocated to him/her on a predetermined
day and time for providing banking services at
the doorsteps of the habitants.
KIOSK BC Model
It is a web-based application that can be accessed through
internet connectivity on laptop or desktop by authorized
individuals. The CSC e-governance Service India Ltd,
FIA Technology Services Pvt Ltd and Geosansar are
appointed as BCs for providing banking services in the
villages allocated to the Bank as well as for implementation
of Urban Financial Inclusion. This is a card less solution;
account holder can operate the account on the basis of
account number as well as Aadhaar number. The Kiosks
are connected with your Bank’s CBS through web-based
connectivity from the computer system/laptop of the kiosk
operator. The transactions are processed through biometric authentication on online real time basis. As on 31st March,
2014, your Bank covered 7,525 villages through 2,780 Kiosk
centers and also established 1034 urban kiosk centers
across the country.
The customized vehicle (van) is specifically designed for
the purpose of banking activity. The exterior of the van is
covered with the Bank advertisements and information about
products offered by the Bank in rural areas. Thereby, it is also
an advertising media for your Bank in rural segment. The
van is equipped with computer hardware and connectivity to
access the CBS. The Bank staff is deployed on the van to
provide banking services in the villages. The van is moving
into the cluster of villages on predetermined days and time
which are in proximity to the existing branches, for providing
online banking services. The banking services are being
provided during fixed days in a week. At present, 15 mobile
vans have been deployed for catering financial services
to 211 villages in the states of Uttar Pradesh, Rajasthan,
Gujarat, Uttarakhand, Bihar and Goa.
Brick and Mortar Branch
The brick and mortar branches are opened in a comparatively
bigger village having the potential and viability. Such centers
are identified during the course of finalization of the Bank’s
branch expansion plan. As per the Bank’s FIP, 1,772 rural
branches have been opened as against a target of 1,554 for
the current financial year. Your Bank had annual target for
opening 334 branches in un-banked rural area as per the
disintegrated FIP submitted to the RBI, which is comfortably
achieved by opening of 430 branches in FY14.
New Initiatives of bank under Financial Inclusion
Kiosk banking Model
The Kiosk banking model was launched by Shri S.S.
Mundra, Chairman & Managing Director, by virtually
inaugurating 1,000 Kiosks on the 106th foundation day of
your Bank i.e. 20th July 2013. Your Bank has arrangements
with Common Service Centers (CSCs) to avail their
services as Business Correspondent of your Bank for
running the Kiosk centers. The common service centers
are ICT enabled front end service delivery points at the
village level and urban centers for delivery of government,
financial, social & private sector services in the areas of
agriculture, health, education, entertainment, banking,
insurance, pension, utility payments, etc. Your Bank has
also engaged other service providers for similar banking
Kiosks in urban/rural centers. These Kiosks would be
connected with the CBS of your Bank through web-based
connectivity from the computer system/laptop of the kiosk
Urban Financial Inclusion
The rural inhabitants have largely remained the focus of
the financial inclusion efforts since, a large proportion of
the villages are still unbanked. Besides people living in
rural and far flung areas, urban poor still have no access to formal financial products and services like savings, credit,
remittance and insurance, forcing them to depend on
usurious informal sources to meet their personal, health,
and livelihood-related needs. Many of those are normally
migrant labors, hawkers, slum dwellers from rural areas
that generally leave their villages for livelihood. In order to
cover them under financial inclusion, the Government of
India has started campaign in all states through SLBC fora
to bring these vulnerable groups under mainstream financial
system. Your Bank has introduced urban kiosks at various
locations across the country. Shri S.S. Mundra, Chairman
& Managing Director launched urban kiosk at Abgaonkala
in Harda district of Madhya Pradesh on 19th January 2014.
As on 31st March 2014, your Bank set up more than 1,000
urban kiosk at various locations across the country.
Products Offered under Financial Inclusion
Basic Savings Bank Deposit Account with in-built
This product is specially devised for individuals from
Financial Inclusion villages as per the RBI guidelines. The
account can be opened without depositing any amount
which doesn’t attract any penalty and will be opened through
BC. These accounts can be operated through business
correspondents as well as at the branches. In–built overdraft
facility up to Rs 10,000 is available under the scheme.
Overdraft of Rs 250 can be availed immediately on opening
of the account by the customer and availability of higher
amount of overdraft up to Rs 10,000 is performance linked.
Recurring Deposit (RD) Account
This is money back RD facility duly designed for financial
inclusion account holders to provide liquidity. The product
offers money back facility, at the end of six months, an
amount equivalent to 50.0% of the outstanding credit
balance in the account can be paid back as per the
requirement of depositor.
Baroda Kisan Credit Card (BKCC)
This product is for farmers which covers their needs like
production credit, investment credit, personal loan needs
as well as consumption needs. It is flexible in utilization of the limit as he can utilize the limits as per his requirements
during the year.
Baroda General Credit Card (BGCC)
The BGCC is implemented through all the branches of your
Bank. The credit facility offered under the scheme would
include working capital and term loan requirements of the
Baroda Swabhimaan Suraksha (Low Premium
Your Bank has introduced life insurance product with low
premium for financial inclusion customers in coordination
with India-first Life Insurance Company. An insurance cover
of Rs 5,000 to Rs 50,000 is available at premium of Rs 20.88
per thousand for five years.
Financial Literacy Key to Successful Inclusion
The desired objective of Financial Inclusion can be achieved
only when we are able to generate equal responses from
the villages. In order to invoke responses amongst villagers,
there is a need to educate them on various banking
facilities and its benefits to them. In other words, financial
literacy would be the key for success of financial inclusion
initiatives of the bank. Therefore, all constituents of FI need
to develop a bond with each other for not only to provide
banking facilities, but also to create a massive awareness
of banking and banking products amongst the population
through Financial Literacy, wherever implementing
Financial Inclusion programme. Your Bank’s link branches
are arranging Financial Literacy campaign by conducting
meetings and addressing the habitants in different forums.
Your Bank has taken the following major initiatives towards
financial literacy in rural parts of the country.
Baroda Swarojgar Vikas Sansthan (Baroda RSETI) is a
trust formed by the Bank way back in 2003 for undertaking
skill building activities for unemployed rural youth and
providing hand holding support to them till their settlement
in their venture. Your Bank has established 47 such centers
all over the country. During FY14, around 33,974 youth
beneficiaries were trained at these centres, out of which
22,297 have established self employment ventures. The
settlement ratio of candidates trained to candidates settled in business works out to 65.63%.
Around Forty six Financial Literacy & Credit Counseling
Centres (FLCCs) “SAARTHEE” are operational across
the country. Since inception, around 19,731 individuals
visited FLCCs of which in 10,460 cases, the issues were
Around Fifty two Baroda Grameen Paramarsh Kendras
facilitate financial education, credit counseling, information
sharing and problem solving on technical issues, synergy
& liaison with other organizations for value added services
and development activities in rural areas.
Mobile Micro Finance Loan Factory has been established
with a vision to provide credit and banking facilities to SHGs
at their doorstep under the SHG–Bank linkage program,
ensuring hassle free and prompt credit delivery within
maximum of four days & hassle free credit to the SHGs.
“BYST-BoB Entrepreneurship Development Programme”
(BYST) provides end-to-end support to disadvantaged
young dynamic micro-entrepreneurs in the form of Loans,
Business Mentors, Training, Networking and Marketing.
Direct Benefit Transfers (DBT)/Direct Benefit
Transfer for LPG Subsidy (DBTL)
The Government of India as well as State Governments
give various subsidies, Pensions, scholarships, MNREGA
Payments etc to the beneficiaries under various government
programs. Many of these were given through cash
distribution systems. Considering the present inefficiencies
in the system, the respective government departments
have planned to deliver these kinds of payments through
electronic mode by way of direct credit in the accounts
of the beneficiaries. There are 34 government schemes
identified as of now for DBT payments. At present, the
government has rolled out DBT in 121 districts. Besides this,
the Government of India also has decided to give subsidy
on LPG gas cylinders to domestic users directly through
DBTL scheme as against indirectly to producers. The DBTL
scheme was rolled out in 291 districts in phased manner
since July 2013. It is expected that DBT/DBTL system
would be able to reduce the pilferages and inefficiencies in
distribution systems, thereby benefiting the government as
well as the beneficiaries. Your Bank has developed Aadhaar
linking facility with the account of the customers for roll out
of DBT/DBTL. Your Bank had organized camps for seeding
of Aadhaar and opening accounts of the beneficiaries in the
districts identified for DBT/DBTL. Your Bank’s branches
are approaching DBTL beneficiaries residing within their
vicinity for seeding of Aadhaar and opening of accounts
of beneficiaries who do not have bank account in all the
districts identified for roll out of DBTL.
Highlights of the Bank’s Performance under
Financial Inclusion in FY14
• Your Bank covered 14,161 villages against a target of
• Your Bank opened 74.66 lakh “Basic Savings Bank
Deposit Account” against target of 63.74 lakh, out of
which 18.71 lakhs accounts were opened through the
• The balance outstanding in the “Basic Savings Bank
Deposit Account” of your Bank is around Rs 1,918 crore.
• Your Bank sanctioned overdraft of Rs 11.31 crore as
against a target of Rs. 6.22 crore in Basic Saving Bank
• Your Bank opened 2,584 Ultra Small Branches (in
villages with population above 2,000) to strengthen
functioning of BC model.
• Your Bank approved a disaggregation plan up to the
branch level to implement its FIP for 21,526 villages
by March 2016.
• Your Bank launched its Urban Financial Inclusion
drive by opening more than 1,000 Kiosk at various
locations in metro and urban centers across the country.
• Also, your Bank surpassed all targets set under
disaggregated FIP for FY14.
In the year 2013-14, the world economy continued to
experience subdued growth. While the protracted recession
in the euro area has finally ended, the growth in the United
States strengthened to some extent. A few large emerging
economies, like India, managed to backstop the deceleration
they experienced in the past two years and moved upwards
moderately. Your Bank continued to make a mark in the
international arena by staying strong and resilient to the
global environment. The International Operations of your
Bank maintained a healthy growth in business as well as
Your Bank retained its market position as one of the leading
Indian banks in providing services to the customers across
the globe. The overseas centers continued to synergize
and work as a team for making most of the opportunities
in the international market. New initiatives were taken in
IT infrastructure for enhancing customer satisfaction. Your Bank further spread its presence in UAE, Tanzania and
Uganda by opening an additional branch in each of these
Business & Profit Performance
During FY14, the Total Business of your Bank’s overseas
branches registered a growth of 33.3%. While Customer
Deposits increased by 33.2%, Total Deposits by 43.6% and
Advances by 20.2%.
During FY14, International Operations of your Bank
contributed a sizeable 32.6% to your Bank’s global business.
Total Assets of your Bank’s International Operations
showed a healthy growth of 39.1% having increased from
Rs 1,66,460 crore as of Mar, 2013 to Rs 2,31,552 crore as
on Mar, 2014.
In the period of subdued growth and pressure to maintain
the margins, your Bank was successful in maintaining its
gross profit for the year FY14 in line with the previous year.
This is due to the proactive measures taken by the overseas
territories and adaptability to changing scenarios. The Net
Profit had a growth of 22.2% during the year.
Contribution of international operations to the Bank’s global
Net Profit was at 25.4%.
Asset Quality in Overseas Operations
Asset quality is one of the most critical areas in determining
the overall health of a bank. Your Bank has an efficient credit
monitoring mechanism at the overseas centers to ensure
the quality of the loan portfolio and the credit administration
Due to the global slowdown in the recent years, all sectors
of the economies across the globe have been impacted
thereby increasing the importance of maintaining strong
asset quality. The stressed and restructured accounts are
being monitored in your Bank’s overseas territories on a
Net Advances during FY14 increased by 20.2% over the
level of previous year. Your Bank has put in best efforts
to maintain the quality of assets, as the Gross NPAs of
International operations as per cent to Total Advances of
International Operations was 1.57% as on Mar, 2014 versus
1.37% as of Mar, 2013.
Your Bank’s International Presence
Your Bank’s international presence covers 24 countries
through its 102 branches/offices as under:
Bank’s Overseas Branches/ Offices
Bank’s Representative Offices
Branches of Bank’s Overseas Subsidiaries
The Bank also has following Joint Ventures/ Associates:
1. Indo Zambia Bank Ltd., Zambia having 25 branches.
2. India International Bank (Malaysia) Bhd., Malaysia
having one branch.
Overseas Expansion in FY14
During FY14, your Bank opened three new overseas
branches/offices. An Electronic Banking Service Unit at
Shabiya, UAE was also made operational during the year.
Moreover, two branches of the subsidiaries were opened at
Kariakoo in Tanzania and Kololo in Uganda.
Future Plans for Overseas Business
With a view to consolidate operations and improve/protect
the market share, your Bank has further plans for expansion
in upcoming centers in the countries where your Bank is
already present. Your Bank also has plans to enter new
countries offering opportunities for profitable growth of
Necessary infrastructure is being created for further
expanding the network in UAE, UK, Kenya, Tanzania and
The overseas expansion is considered in line with the various
directives issued from Ministry of Finance, Government of
India regarding overseas expansion of Public Sector Banks
Syndication Centres in Overseas Operations
Your Bank’s Global Syndication Centre at London and
Regional Syndication Centres at Dubai and Singapore
specially focus on the business of Syndication Loans
in International Market. Your Bank has also set up an
International Merchant Banking Cell (IMBC) at Corporate
Office, Mumbai, which mainly caters to the requirements of
Indian corporates and also supports the regional syndication
centres to canvass business from Indian corporates who
are in need of foreign currency resources. Your Bank is
an active player in the Syndication Loan Market and also
participates in loan origination.
Products and Services in Overseas Business
Your Bank has customized products and services according
to the local needs for each country of operation. Your
Bank provides state of the art products and services in
the international market to suit the business needs of the
The single Core Banking Solution at all the overseas
branches and subsidiaries of your Bank facilitates
introduction of new products and services and helps in
carrying out modification/improvement in line with the
requirements of customers in the country of operation.
Technology in Overseas Territories
- The number of ATMs at overseas Territories and
subsidiaries increased to 91 (55 on-site and 36 off-site)
as on 31st March, 2014 from 89 (54 onsite and 35 offsite)
as on 31st March, 2013.
- Debit Card/ATM card issuance is implemented in
ten overseas territories/subsidiaries out of which four
territories/subsidiaries are having tie-ups with Global
Payment Technology Company M/s VISA. Furthermore,
VISA accreditation is in progress for Oman territories
and Guyana, Uganda, Kenya subsidiaries.
- Many of the territories/subsidiaries are moving
to chip-based debit cards. The EMV (chip cards)
implementation in UAE territory has been completed
and implementation in Oman and Mauritius territories
is in progress.
- Internet banking (Baroda Connect) is implemented in 14
overseas territories/ subsidiaries. viz 1.UAE, 2. United
Kingdom 3. Oman, 4. Mauritius, 5. Fiji 6.Seychelles,
7. Australia (View) 8.Kenya, 9.Uganda, 10.Botswana,
11.New Zealand, 12. Ghana. 13. Tanzania (View
Based) 14. USA (View Based). The USA territory has
been added in this financial year and internet banking
implementation is in progress for Trinidad & Tobago
and Guyana Subsidiaries and will be made live in the
next financial year.
- Fraud Management Solution (2FA) has been
implemented in internet banking of New Zealand,
UAE, UK, Uganda, and Kenya and compatibility of
e-banking in Smart Phones has also been enabled for
these territories/subsidiaries. The FMS implementation
in progress for Botswana, Fiji, Oman, Mauritius,
Seychelles and Ghana territories/ subsidiaries.
- Implementation of Centralized SWIFT activity for
all territories/subsidiaries (except USA) has been
completed and operating from Data Centre. The US
territory has outsourcing agreement with M/s Fundtech
for processing of SWIFT activities.
- The AML Erase (Batch mode) solution has been
implemented in Australia during the year FY14. The
AML Erase Solution is now available in all overseas
territories/subsidiaries except the US. The US territory
has outsourcing agreement with M/s Fundtech for online
AML and OFAC scanning. The offline transactions
checking are done through Prime Compliance suite.
- The Global Treasury Solution is implemented in
DIFC Dubai in this financial year. Now GTP solution
is available at US, UK, UAE, Bahamas, Bahrain,
Hongkong, Singapore, Belgium and DIFC Dubai.
- The Cheque Truncation & Automated Clearing House
implementation in Trinidad & Tobago, Seychelles and
Botswana is in progress.
- Approach finalized for sending SMS alerts for all
transactions in international territories/subsidiaries.
Implementation is in progress for six territories/
subsidiaries. (Fiji, Guyana, Uganda, Botswana, China,
- In view of the end of technical support for Windows XP,
your Bank has initiated the process for Migration from
Microsoft Windows XP to Windows 7 for all PCs and
ATMs in its international territories/ subsidiaries.
Risk Management in Overseas Operations
Your Bank has strong Risk Management Systems in place at
the overseas centers to deal with the additional risks in the
international banking scenario. Separate Risk Management Department has been set up at overseas centres to deal
with Credit, Market & Operational Risks. Specialized Risk
Managers have been posted at the overseas centres.
The Basel II guidelines were implemented at all the overseas
territories with effect from 31st March, 2008 and your
Bank has adopted Standardised Approach for Credit Risk,
Standardised Duration Method for Market Risk and Basic
Indicator Approach for Operational Risk.
The BOB RAM Model for internal Credit Rating has been
implemented at overseas centres. It has further strengthened
the credit monitoring by capturing vital information related
to advances accounts.
The Special Model for Asset Classification and Credit
Monitoring has been implemented at all the overseas
territories of your Bank.
Regulatory Compliance in Overseas Operations
Your Bank has a reputation of being a Regulatory Compliant
Bank. Dedicated compliance teams are present at overseas
centers to ensure that stringent of the home/host country
regulatory norms are followed.
Well-integrated compliance setup ensures that compliance
issues of the Bank are handled in a timely manner. Your
Bank has posted officers at overseas centres whose skills
are continuously enhanced through trainings and other
avenues. Your Bank does not see compliance as merely a
regulatory requirement but a duty to protect the interest and
reputation of the Bank and its stakeholders.
The overseas territories/subsidiaries have the prudential
policies/manuals in varied areas of banking as per their
respective regulatory requirements, which are periodically
reviewed to ensure that they are in conformity with the
regulatory guidelines and requirements.
Your Bank operates its Treasury from a State of the Art
Dealing Room at Baroda Sun Tower at its Corporate Office
in Mumbai. This dealing room is well positioned to scale up
your Bank’s Treasury Operations and keep pace with the
latest developments in the market. Your Bank’s Treasury
handles domestic treasury operations and covers activities
in various markets i.e. Foreign Exchange, Interest Rates,
Fixed Income, Derivatives, Equity and other alternative
asset classes. A basket of financial products are offered
to Bank’s clients like interest rate swaps, currency swaps,
forwards and options facilitated by the advanced technology
platforms used by your Bank .
A sophisticated Automated Dealing System caters to
the needs of clients of Authorized Branches dealing in
foreign exchange transactions across the country. During
the financial year under review, your Bank successfully
implemented Global Treasury Solution, as part of Business
Process Re-engineering, at DIFC, Dubai.
During the summer of 2013, the market perception of potential
tapering of US Quantitative Easing triggered outflows from Emerging markets across the Globe. Indian markets saw
major outflow of portfolio investments, particularly from the
debt segment causing yields to fluctuate sharply in the first
half of the last year. As a result of portfolio outflows from
Debt and Equity markets along with concerns over adverse
current account deficit, the Rupee depreciated to Rs 68.84 in
August 2013. To attract inflows into debt segment, the RBI
hiked Repo and the Marginal Standing Facility (MSF) rate
by 200 basis and made MSF rate at 10.25%, the operating
money market rate. The overall allocation of funds under
LAF Repo against surplus SLR Securities was limited to
0.50% of the Net Demand and Time Liabilities (NDTL) of
the banking system. Furthermore, banks were required to
maintain a minimum daily CRR balance of 99.0% of the total
requirement (from earlier 70.0%).
While rolling back the above temporary measures after the
stabilisation of external situation, the RBI addressed the
continuing pressure on CPI and hiked the Repo rate by a
cumulative 75 bps to 8.00%.
Your Bank was able to capitalize on the opportunity offered
by the sharp fall in yields in the first two months and the
sharp yield movement upward later in the year was adroitly
handled in terms of its impact on the Bank’s fixed income
investments. Your Bank utilized the opportunity presented by
higher bond yields to add bonds to the portfolio and increase
the average yield on Investments. The average yield on
Domestic SLR investments was 7.85%. During FY14, your
Bank’s Treasury earned Rs 9,793 crore as Interest/Discount
earnings, while Profit on Sale of Investment and Exchange
Earnings were Rs 732 crore and Rs 575 crore, respectively.
Your Bank’s Treasury offers customized solutions using
available products viz Interest Rate Swaps (IRS), Currency
Swaps (CIRS), Forwards and Options to meet the Interest
rate and Foreign Exchange risk mitigation requirements of
the corporate clients. During the year, your Bank’s Treasury
actively raised funds by undertaking USD swap with RBI
against the FCNR deposits and Tier I capital, under the
special RBI swap window provided to the banks. The Interest
Rate Swaps and Currency options were widely used for
hedging the interest rate and currency for the corporates.
Your Bank’s Treasury started dealing in Exchange traded
Cash settled Interest Rate Futures based on 10Y benchmark
Government Security and emerged as one of the major
player in the market. Arbitrage opportunities available
between asset classes including Money Market CBLO, Call,
Market Repo, Government Securities and Forex markets
were effectively utilised.
The sentiment in equity markets improved during second
half of FY14 due to FII inflows fuelled by the expectations of
an investor friendly and stable government after the general
elections in May 2014. The Equity desk of the treasury
actively churned its portfolio and booked profits at regular
intervals whenever an opportunity emerged in the markets.
The Foreign exchange desk of the Treasury retained its
position as one of the premier market players in the Forex
desks of the Public Sector Banks. The Proprietary trading desk was active in encashing the available arbitrages and
mobilised resources in tight situations of liquidity impacting
the Indian markets.
Your Bank’s Treasury Mid-Office monitors market exposures
and limits fixed by the Board of Directors, on a real time
basis. The Risk Management parameters, including
Value-at-risk (VaR) are used to measure Market Risk on
all portfolios. These measures are backed up by the Back
Testing on risk numbers and Stress Testing of various
investment and currency portfolios.
Corporate Social Responsibility (CSR)
As a responsible corporate citizen, it has been the
endeavour of your Bank to empower the community through
socio-economic development of the underprivileged and
In its continued efforts to make a difference to the society at
large, your Bank intensified its efforts further in this direction
Some of the initiatives in the domain of CSR undertaken by
your Bank are as follows.
• Your Bank has established Baroda Swarozgar Vikas
Sansthan (Baroda R-SETI) for imparting free training
to unemployed youth to develop their entrepreneurial
skills to become self employed. This is expected to
improve the economic status of their families and also give a boost to various regional economies within these
locations. All the Lead Districts of your Bank have an
R-SETI each. About 47 such Sansthans have been
established by your Bank in which more than 1,92,247
youth have been trained and around 1,20,979 have
been gainfully self employed.
• In order to spread awareness among the rural masses
on various financial and banking services and to speed
up the process of financial inclusion, your Bank has also
established 46 Financial Literacy Centres (FLC) across
India. These centres will impart financial literacy in the
form of simple messages like Why Save, Why borrow
from banks, Why borrow as far as possible for income
generating activities, Why repay in time, Why insure
yourself, Why Save for your retirement, etc.
Asset Quality Management
The year FY14 was a challenging year for the banking
industry to maintain the Asset Quality due to a fragile
economic environment. But your Bank continued its
practice of rigorous monitoring and recovery of the NPA
portfolio. However, due to downward pressure on various
economic indicators impinging the banking industry, your
Bank continued to witness pressure on its NPA position
Indian banks, in general, witnessed heavy incidence of
slippages in FY14 due to volatile financial markets both
within and outside India, higher inflation and higher interest
rate regime throughout the FY14. In spite of various
depressed economic parameters impacting the Bank, fresh
slippages, during the year, were at 1.99% of the opening
Standard Advances of your Bank. Against the backdrop of
high slippages, the ratio of Gross NPA to Gross Advances
was at 2.94% as on 31st Mar, 2014. Consequently, the ratio
of Net NPA to Net Advances stood at 1.52% by end-Mar,
2014. Yet, these were one of the lowest in the large-sized
public sector banking space.
In the past several years, your Bank made all out efforts to
maintain the Loan Loss Provisioning ratio at or above the
mandated norm of 70% set by the RBI. However, due to a
steep rise in NPAs and higher provisioning, the loan loss
coverage ratio was at 65.45% during FY14, after factoring
in the Prudential/ Technically Written-off advances. It may
be noted that during the year FY14, this ratio continuously
improved on sequential basis from the second quarter to
the fourth quarter of the year (from 61.68% in Q2, FY14 to
65.45% in Q4, FY14).
Your Bank has developed a comprehensive structure of
recovery and credit monitoring function at the branch, region,
zone and corporate levels. Besides this, the nodal officers
at each Debt Recovery Tribunal (DRT) centre are assigned
the role of a follow-up of legal cases on day-to-day basis so
as to minimize the delay in obtaining decrees and execution
thereof, in order to expedite and maximize recoveries.
For recoveries of all DRT suit filed NPA accounts, the
assets charged to the banks are now being sold through E-auction to get a fair market value of assets charged to us.
Additionally, to speed up the recovery Asset Reconstruction
Companies (ARCs) have been appointed as recovery
agents and consultants have been appointed to liaison
with official liquidator (OL) to get the recoveries realised by
OLs. Lok Adalats, Recovery Camps and Village Chaupal
Meets were regularly conducted by your Bank’s branches
to reduce long pending cases and expedite recoveries in
Your Bank continued its emphasis on follow-up mechanism
to explore recovery prospects of NPA accounts. The system
of monitoring of large value NPA accounts of say Rs 1
crore and above directly from the corporate office by way
of fortnightly video conferencing with the regions and zones
have ensured proactive action by branches, advocates,
recovery agents, etc. The actions under SARFAESI Act at
various levels were also monitored by the Bank’s Corporate
Office. Therefore, the cash recovery in NPA accounts during
FY14 was Rs 1,261.81 crore, higher than the cash recovery
of Rs 625.57 crore during FY13. The upgradation was higher
at Rs 684.72 crore during FY14 compared to Rs 340.93
crore during FY13.
During FY14, your Bank laid specific focus on recovery of
small accounts by organizing Lok Adalats and Recovery
Camps at village/town level. Moreover special Schemes
called Vishesh Vasooli Yojana and Bhagirath Prayas were
also launched during the first half of FY14. Your Bank
also launched an incentive linked recovery scheme called
“Sankalp – VI”, to enlist personalized attention of each and
every staff member in pursuing recovery efforts of small
value accounts with an outstanding up to Rs 25 lakh. The
cash recovery made during FY14 under this scheme was
very impressive at Rs 155.19 crore.
As a part of strategy suggested by the RBI for NPA
management, your Bank put for sale of NPL accounts
under individual as well as portfolio sale during FY14 and
as a result of good response from the market, could sell 23
NPL (NPA & Write Off accounts) accounts with aggregate
outstanding balance of Rs 671.27 crore to four ARCs (with
Net Book Value of Rs 253.65 crore).
The “asset classification-wise” breakup of advances portfolio
of your Bank is as under.
| (Rs crore)
Asset Category (Gross)
31st March 2014
31st March 2013
Gross NPA is comprising of:
Total Gross NPA
Information Technology (IT)
Your Bank has undertaken a total end-to-end business and
IT strategy project covering your Bank’s domestic, overseas
and subsidiary operations.
- Your Bank has built the best of technology infrastructure
by implementing a state-of-the-art Data Centre
conforming to Uptime Institute Tier-3 standard and also
a Disaster Recovery Site in different seismic zone with
redundancy built in every single point of failure to ensure
uninterrupted banking service delivery to customers.
- In addition to the Disaster Recovery Centre, your Bank
has also implemented the Near Disaster Recovery
Centre during the year to ensure Near Zero Data Loss
as part of its Business Continuity Planning and Disaster
- Your Bank continued to optimise its technology initiatives
like windows server virtualization, desktop virtualization
and backup consolidation as green initiatives and also to
improve Data Centre operational efficiency. Application
virtualization, Automatic Storage Management (ASM)
& Real Application Clusters (RAC) Implementation,
Bandwidth up-gradation, provision of backup link, use
of new technology based on MPLS (Multi Protocol
Label Switching) for improving uptime and on demand
upgrade are some of the major initiatives.
- Your Bank has been undertaking regular capacity
planning, upgrade and refresh to support growing
demand of business at various service delivery
- Your Bank has an upgraded Enterprise Management
System and modules have been deployed to effectively
manage and monitor Bank’s growing IT infrastructure.
- Your Bank has deployed centralised IT architecture to
provide the Core Banking Solution (CBS) and other
application platform to all its domestic branches and 23
overseas territories, providing ease of management &
monitoring and optimisation of resources. Your Bank’s regional rural banks (RRBs) are also on the CBS
Platform and as notified by the Government of India
(GOI), your Bank has successfully amalgamated RRBs
of Central Bank of India and Punjab National Bank with
350 branches into one of the RRBs of your Bank.
Alternate Delivery Channels
• Internet Banking - BARODA CONNECT
Internet Banking, viz., Baroda Connect has been completely
revamped in your Bank to enhance its look and feel,
user-friendliness and user experience based on heuristic
evaluation and usability audit. Your Bank continued to add
more facilities under its Internet Banking channels. Other
enhanced features such as Online FDR Double Dhamaka,
online recurring deposit opening, online gift card, Tax
payments of various States, multiple challans for excise duty,
Credit to Loan accounts, Bill payments, Online donations to
Prime Minister Relief Fund, India Life Insurance premium
payment, aadhaar seeding through internet banking, IMPS
(Immediate Payment services). Internet Banking facility is
made available on all Smart-phones/tablets offering comfort
of anywhere banking to its customers. Internet Banking
has also been implemented in total 14 overseas territories
viz. Tanzania, Uganda, Kenya, Mauritius, Seychelles,
Botswana, New Zealand, UAE, Fiji, UK, Oman, Ghana,
Australia and USA. Internet banking is also provided in all
Bank- sponsored RRBs.
In order to enhance security and confidence in Internet
Banking, your Bank introduced enhanced security features
by deploying Fraud Management Solution, including
step-up authentication based on risk analysis, two factor
authentications by enabling OTP, PULL OTP, SMS
OTP, QnA. Your Bank has also introduced use of digital
certificates for corporate customers for authentication and
non repudiation in high value interbank transactions through
internet banking. Your Bank has initiated the process of
implementing Fraud Management Solution for remaining
five overseas territories where transaction-based e-Banking
• Mobile Banking – BARODA M-CONNECT & IMPS
As one more alternate delivery channel, many features
are available on the Mobile Banking platform of your Bank
to provide various facilities to customers, viz., balance
enquiry, mini statement, fund transfer, stop payment,
cheque status, debit card blocking, other services. Mobile
banking application is made available in all i-Phones and
i-Pads in addition to Blackberry, Android, Windows devices.
Immediate Payment Services (IMPS) are implemented
covering Person to Account (P2A), Merchant Payments
(P2M), Aadhaar based remittance (P2U). IMPS merchant
payments (P2M) enabled for Mobile top-up / DTH top-up,
Insurance premium payment, Online shopping, Over-thecounter
payments, fees payments to schools/colleges/
universities, Utility Bill payments, Travel & Ticketing, Temple
Donations, Non internet based railway ticket booking
through mobile phones using IMPS – IRCTC. Under Mobile Banking, your Bank is now enabled NUUP (National Unified
USSD Platform), providing ease of use and convenience
Your Bank embarked on the next level of customer
engagement by enabling 24 X 7 services for customers
through eLobbies. Devices like Bunch Note Acceptors, Self-
Service Pass Book Printers, Cheque Deposit Kiosk, Internet
Banking Kiosks, were installed in more than 30 eLobbies
attached to branches. Cash deposit in Bunch Note Acceptors
was enabled through card as well as account number to
provide convenience to customers. In the coming years,
large scale expansion of this network is targeted. Your Bank
is also proposing to introduce Cash Recyclers which accept
cash, sort it and make payments from the deposited cash.
The ATM Switch is upgraded in your Bank to a higher version
along with Hardware up-gradation with enhanced features
for better performance, speedy ATM transactions and ease
of ATM expansion. The ATM switch is deployed for India,
UAE, Oman, Mauritius, Fiji, Tanzania, Botswana, Trinidad
& Tobago (T&T) and New Zealand. Your Bank introduced
Non Personalised Debit Cards during the year to enable
faster and hassle free delivery of cards to the customer over
the counter at the time of account opening itself. Your Bank
enabled NEFT remittances from ATMs during the year. Many
customer centric initiatives such as RuPay Debit Cards,
RuPay POS and RuPay KCC Cards, RuPay e-commerce,
Brown label ATMs, Collection of Insurance premium for India
First Life Insurance Policy holders, Cheque book request,
Immediate Payment Services (IMPS) through ATMs are
undertaken. Talking ATMs deployed for visually impaired
persons. Your Bank has also completed certification of
RuPay Chip card for international usage, enabling cash
withdrawal & balance enquiry for prepaid cards, gift cards
& General Purpose Reloadable cards on ATMs, Aadhaar
seeding through ATM. For enhanced security as well as
implementation of RBI mandates, chip based cards were
introduced. multi-factor authentication for card not present
transactions implementation of Fraud management Solution
in ATMs/ POS in India ATM Transaction receipt printing in Hindi, Regional Language Screen selection for Gujarati,
Marathi, Tamil, Malyalam, Telugu, Kannada and Bengali are
enabled on ATM. Visa Debit card for UAE, BSP (Bank South
Pacific) Interchange Implementation for Fiji, Chip Based
Card Implementation in India, Oman and Mauritius,. Your
Bank has successfully launched RuPay ATM and RuPay
KCC cards for its RRBs also.
• SMS Banking
For customers who desire to avail only information based
banking services, your Bank has introduced SMS banking
for balance enquiry, mini statement, Cheque status from the
registered mobile number. This is a very simple and easy
to use product that a customer can start using without any
• Contact Centre
Your Bank has implemented Customer Relationship
Management as a new initiative to get 3600 view of the
customer for providing better services through a contact
centre over phone in order to improve their satisfaction and
loyalty. Existing customers/Prospective customers may call
on Toll Free no. (1800223344 & 18001024455) wherein
following services can be availed of.
- Issuance of a cheque book
- Enquiry about products and services
- Account Enquiry – Balance, Transaction, Amount in
- Hot-listing of ATM cards
- Stop payment marking / un-marking
- Request for issuance of debit card
- Request for re-generation of debit card PIN
- Support for e-banking users
- Re-generation of mobile banking password
- On-line (paperless) TPIN generation facility
- Other information regarding products and services of
your Bank is also provided to prospective customers/
- The CRM applications is linked to sales offices like
Retail Loan Factories (RLFs), City Sales Offices (CSOs)
wherein the leads generated at contact centre on the
basis of enquiry about the products by customers are
transferred to these offices for further processing.
- Your Bank has also completed a launch of recovery
processes through contact centre wherein customers
are informed about the EMI and due amounts. This
shall facilitate customers to deposit EMI/due amount
on demand dates.
- All branches of your Bank are enabled for interbank
remittances through RTGS and NEFT. The RTGS and NEFT have also been interfaced with your Bank’s
internet banking portal. The Straight through Processing
(STP) of NEFT & RTGS have been implemented for
the Bank as well as RRBs. Your Bank has upgraded IT
infrastructure and architecture change to support large
volume and ISO20022 message format used for NGRTGS.
RTGS & NEFT have also been implemented
- Internet Payment Gateway services for debit cards/
credit cards are increasingly offered to merchants and
internet shopper as a safe and secure channel for online
- The SWIFT facility for worldwide inter-bank financial
communication is provided at Foreign Exchange
Authorized Branches in India as also in 22 overseas
- The Payment Messaging Solution (PMS) is implemented
in 22 overseas territories & all authorized branches in
India. PMS facilitates validation and formatting of
SWIFT messages generated from CBS as per SWIFT
standards, and also goes through AML check.
- During the year under review, a grid based Cheque
Truncation System (CTS) was implemented in MICR
Centres Mumbai and Western Grid of Maharashtra,
Gujarat and Madhya Pradesh.
- National Automated Clearing House (NACH) is
implemented for both debit and credit transactions.
Other Customer Centric initiatives
- Your Bank has been offering highly customised IT
enabled products and services tailored to the specific
requirements of valuable clients. Other products and
services like RBI Inflation Indexed Bonds, bulk issuance
of gift cards, direct dispatch of debit card & PIN mailers
to customers, remittances under Money Transfer
Service Scheme for exchange house, etc., have been
implemented as well.
- Cash Management System is a full-function web enabled cash management solution offered to your
Bank’s customers, covering services like Receipt
Management (Collections), Payment Management
and Invoice Management (Receivable and Payable
Management). During the year, your Bank implemented
Two Factor Authentication (2FA) for Cash Management
System, opening a new channel for customers to
manage their funds position quickly with Straight
Through Processing (STP).
- The Retail Depository Services are made available to
your Bank’s Retail as well as Corporate customers.
With a centralized depository application, branches are
equipped to provide depository services for both NSDL
as well as CDSL. With Online Trading System, your
Bank will be able to provide complete suite of online
services to the customers for trading in instruments like
equities, mutual funds, bonds and initial public offering
- New PA-DSS complaint Debit Card Management System
has been implemented to provide comprehensive
management and support for your Bank’s Debit Card
- Your Bank has initiated Aadhaar based payment
like Direct Benefit Transfer (DBT), Electronic Benefit
Transfer (EBT). Direct Beneficiary Transfer under
Aadhaar Payment Bridge System (APBS) and
wages payment for Mahatma Gandhi National Rural
Employment Guarantee Act (MGNREGA).
- Aadhaar Enabled Payment System (AEPS) for
transactions initiated from POS terminals based on
Aadhaar number in case of account opened under
- Your Bank has extended Central Project Scheme
Monitoring System (CPSMS) to State Governments
for effecting payments of plan funds received directly
at the State Treasuries. Printed Payment Advice (PPA)
based payments as well as Digital Signature Certificate
based payments too have been implemented under
- NPS, NPSLite (a scheme to provide financial security
for economically disadvantaged people for protecting
their future during old age), MGPSY for NRI have been
- The IT setup has been developed for account opening
process and transactions, both online and offline, to
be carried out through Business Correspondent thus
enabling Financial Inclusion.
- The Mobile Van Banking is launched in Gujarat, UP &
Bihar on a pilot basis as the Bank’s Financial Inclusion
- To enable your Bank to have its pulse on the market, an
online customer survey portal has been developed for
getting ongoing feedback from customers. Online portal
is made available on Bank’s web site to customers/visitors to log and track the status of their Feedback/
- Various initiatives like Linking of UID numbers, Account
number portability, Capturing KYC related information,
Simplified account opening procedures, addition of
village codes in core banking system are undertaken
during the year.
- Your Bank has also enabled SMS Alerts delivery facility
to its customers for all transactions made through
alternate delivery channels and for all CBS transactions
above threshold limits. SMS alerts to customers are
also sent for non-financial events like Account opening,
Account Activation, Change in interest rate on loan
accounts, Installment due/overdue notice for loan
accounts, Cheque Book Dispatch (containing delivery
details), Cheque getting rejected, FD Maturity notice,
Notice to customers for KYC Compliance, Notice at the
time of Aadhaar Linking/de-linking, Notice to Potentially
dormant account, Notice at the time of account
The Integrated Global Treasury Solution has been
implemented in UK, UAE, Bahamas, Bahrain, Hongkong,
Singapore, Belgium and in India, reducing the cost of
operations and better fund management.
- For improving your Bank’s service delivery, the Back
Office functions have been centralized at City Back
Offices and Regional Back Offices. Your Bank now has
70 City Back Offices and 12 Regional Back Offices.
The personalized cheque book issuance has been
centralized. Your Bank has also started centralized
- Your Bank has fully automated its Loan Processing
(Retail, Agri and SME) modules for better and quick
customer service. Your Bank also provides a single
click Online Loan Application feature for Home Loan,
Auto Loan and Education Loan.
- Enterprise wide GL Solution has been implemented.
This provides variety of inputs to your Bank for strategic
decision making in business development and also
generates enterprise wide consolidated reports.
- The Centralized Payroll, Salary module, e-TDS module
and Leave Module have been implemented for all your
Bank’s offices in India.
- The Human Resource Networking for Employees
Service has been implemented with the objective of
creating a central database of the Bank employees for
facilitating decision-making, promotion and selection
exercise as also for automating other HR processes.
- Your Bank has also undertaken, as a part of its business
strategy, Data Warehouse for providing flexible and
interactive source of strategic information, Customer
Relationship Management for better customer insight and uniform customer view across channels. It has also
facilitated Automated Data Flow to regulator.
- Your Bank has upgraded existing applications like
Exchange, e-Business suite with enhanced features,
encompassing Customer Relationship Management,
HRNes and Enterprise wide GL modules.
- For regulatory compliance, the Anti Money Laundering
(AML) has been implemented in India and 22
overseas territories. Your Bank has implemented Risk
Management solution. Your Bank has also implemented
AML solution in all its sponsored RRBs.
- Various new Regulatory requirements like Aadhaar
seeding through different channels like ATM, net
banking, SMS, online verification and validation of PAN
numbers, de-duplication of customer ids, etc., were
undertaken during the year.
A robust Information Security Management System was
put in place during the year under review to protect the
technology against security threat. A Comprehensive Audit
by External Agencies is being successfully carried out
by your Bank for its Core Banking Solution and all other
applications as well as for Data Centre/Disaster Recovery
centre Infrastructure. Biometric Authentication is introduced
for CBS Login at Branches.
Your Bank has set up a Security Operation Centre (SOC)
for enhanced IT security. Your Bank’s Data Centre as well
as Disaster Recovery Centre are ISO 27001 certified.
Your Banks has Implemented Fraud Management
Solution for Internet Banking, ATM & POS. In order to
enhance security and confidence in Internet Banking, your
Bank introduced Fraud Management Solution, including
two factor authentications in India and seven Overseas
territories by enabling ARCOT OTP, PULL OTP and
Your Bank is regularly conducting VAPT (Vulnerability
assessment & Penetration Testing) of external facing
applications, e-Banking log monitoring etc.
Your Bank has enabled a Fraud Risk Management system
for day-to-day monitoring of suspicious transactions at
branches for protecting the interests of customers.
While cyber-attacks have become more unpredictable and
electronic payment systems vulnerable to new types of
misuse, it is imperative that banks introduce certain minimum
checks and balances to minimise the impact of such attacks
and to arrest/minimise the damage.
To minimise the damage, your Bank has initiated following
additional security measures which will be enabled shortly.
- Your Bank has implemented the RBI mandates
as part of Risk and Mitigation measures for card
- All new debit and credit cards will be issued for domestic usage unless international usage is
specifically sought by the customer.
- Your Bank will convert existing MagStrip Cards to
EMV Chip card.
- Your Bank will set up PIN enabled POS
- Your Bank will enable additional security as addition
of Digital signatures for Corporate Internet Banking.
Transaction Banking Department has enabled a host
of alternate banking channels for improved customer
interaction, reduce operational cost and develop new
business opportunities. The ATMs, Internet banking, Mobile
banking, Debit cards, Prepaid cards, RTGS/NEFT are a
few of them. The year has seen significant progress in self
service units viz. Bulk/Cash acceptors, Passbook printers,
Internet banking kiosks and opening of 45 Baroda Non-Stop
Given below are the highlights of performance of the various
units during the FY14.
ATM deployment & Debit card issuance
Addition during the year
No. of ATMs
No. of Debit Cards
Issued (in Lakhs)
New Initiatives/achievement during FY14
Enriched ATM experience with multilingual screen and
1,200 talking ATMs for visually challenged persons.
- Your Bank provided 85 Bunch Note/Cash Acceptors at
high cash accepting centres.
- Your Bank launched Non Personalized Cards for instant
issuance to customers.
• Baroda Connect (Internet Banking)
during the year
No. of Users (in
No. of A/cs Linked
New Initiatives during FY14
• Your Bank enabled fund transfer facility and purchase
of Baroda Gift Card through Net Banking portal.
• Baroda M-connect (Mobile Banking)
during the year
Total Amount of
• BARODA RTGS/NEFT
• Baroda e-Gateway (Internet Payment Gateway)
during the year
• Baroda Cash Management
during the year
No of transactions
Turnover (in Crore)
Income (in Crore)
Other initiatives in E-business during FY14
- Installation of 1,200 Self Service Passbook Printers for
easy updation of statement of account.
- Installation of 85 Bunch Note Acceptor (BNA) at high
cash accepting centres.
- Started issuing KCC Card and Debit Card for RRBs.
- Introduction of EMV Chip Debit Card.
- Implementation of web module for Baroda Cash Management Service to meet Corporate requirement.
- Initiated Mobile Banking Rewards Campaign to increase
activation and usage
- Enhanced IVR facility at Contact Centres.
- Implementation of Baroda SMS Banking facility.
- Set up NACH facility for automated clearing.
Initiatives in E-business Planned for FY15
- To increase number of ATMs/Cash Dispensers to 8,000.
- To introduce EMV debit cards of Visa, Master & Rupay
for various customer segments.
- To install 1,000 additional Bulk Note Acceptor/Cash
- To start value added services on ATMs like bill
payments, card to card fund transfer etc.
- To enable debit card blocking through SMS.
- To enhance features of Internet Banking to enable
online account opening and better security.
- To introduce the facility of digital signature in Baroda
Connect for large value payment transactions as
additional security measure.
- In mobile banking, Aadhar Based Payment
System(ABPS) to be introduced in coordination with
- To enable Regional Back Offices (RBOs) to register all
eligible accounts opened at their end for Mobile Banking.
- To enable additional 100 Self Service Baroda NonStop
lobbies to enhance self service foot print and brand
- To install additional 400 Multi Function Kiosks
- To launch e-Passbook service to customers through
Human resources - “Creating Competence
and Passion for Business Excellence”
The triumph and all round growth of your Bank is an outcome
of the synergy of various assets that the Bank possesses.
One of the most vital of them being its Human asset – its
people, which has enabled the Bank to traverse through
an all-encompassing growth trajectory.
Your Bank has a rich reservoir of Human capital comprising of
the skill sets and competencies of 46,001 employees who are
at all times committed towards augmenting "Stakeholders’
Value through Concern, Care and Competence.”
In this journey of excellence undertaken to fulfill greater
aspirations and bigger dreams to touch the lives of all the
stakeholders, it is actually the people power of your Bank
which makes the difference.
Realizing the criticality of this asset for the sustained growth
of your Bank on the one hand, and the multiple challenges
like the large number of retirements, massive intake of
talent, huge training requirements, succession planning
and engagement for higher productivity on the other hand,
a lot has been done by your Bank in the area of Human
Resources in the recent past and more so in the financial
Besides excelling in the routine HR activities like recruitments,
promotions, deployments, etc, a host of new HR interventions/
reforms have been introduced in your Bank under the gamut
of a well-structured and a comprehensive HR transformation
project aptly christened as project Sparsh – “human touch
for business excellence”.
This is an unparallel HR transformation project in the banking
industry sought to construct an integrated framework of the
various elements of the Human Resource function in your
Bank. In over a span of two and a half years, since the
commencement of Project Sparsh in August 2011, several
new and path breaking HR initiatives have been launched
and a host of other existing policies, schemes, processes
have been revamped to make them more broad–based,
futuristic, employee friendly and have greater alignment
with the Bank’s business.
Some of the key accomplishments worth mentioning in the
HR sphere particularly in FY14 are as under:
Strategic Workforce Planning and Recruitment
An optimal manpower mix is a prerequisite for the sustenance
and growth of the business. Hence a scientific manpower
planning model has been put in place for estimating
manpower needs by level, skills and by branch and also for
strategic workforce planning for the next few years to feed into various other HR interventions of recruitment planning,
career progression, vacancies and postings/deployment.
Your Bank has put in place a clearly defined recruitment
policy, which steers the recruitment from different channels,
hiring of larger numbers in view of the emerging requirements
as projected by the strategic workforce planning and also
articulating a clearly-defined employer value proposition with
the acronym “F I R S T” as shown below:
An especially designed ‘Career Portal’ has been launched
on the Bank’s website which defines this value proposition
further with clearly laid out sections related to why your
Bank should be the preferred choice for any prospective
applicant by projecting the different facets of working at
Bank of Baroda. These strategies provide a huge impetus
to the “Employer Branding” of your Bank significantly.
For a Smooth and effective integration of the new hires into
the Baroda Family, your Bank has also put in place a very
well structured and a focused “On-boarding Programme”
which not only aims at functional integration of the new
recruits in the Bank but also their cultural assimilation into
this institution. Going further, your Bank has also launched
a focused Mentoring programme “Baroda Sarthy” for
the new hires wherein the senior employee - a mentor
handholds the new entrant to enable his smooth transition
into the corporate world and help him/her adapt to the value
system and working of your Bank.
“Baroda Manipal School of Banking”
The Baroda Manipal School of Banking (BMSB) is a
unique association of Bank of Baroda and Manipal Global
Education to train students for a banking career in Bank of
Baroda on a “first-day, first-hour” productive model, and
thereby have a ready pool of trained officers. The students
undergo a focused one-year programme customized to
the Bank’s requirements and this leads to the award of a
post-graduate diploma in banking and finance, before they
are absorbed in the Bank as probationary officers. The
programme works on an inverted model of “Train, Hire and Deploy”
This innovative resourcing channel was initiated during the
year FY12 and so far, since its inception, 1,379 students
from seven batches have joined the Bank as officers and at
present, around 1,068 students are undergoing their training
at the BMSB campus at Bangaluru.
Recruitment drive during FY14
Your Bank has been undertaking focused hiring efforts
on a sustained basis year on year, to cater to retirements,
resignations, sustained business growth and rapid branch
expansion etc. Various recruitment exercises were
undertaken during the year to address the emerging
manpower requirements in your Bank. Recruitment of
Specialist officers, Probationary officers and clerical
personnel were initiated to meet the needs of your Bank,
both in terms of replacements for normal attrition and
factoring in the business growth needs. Your Bank recruited
2,685 officers in various Grades / Scales (both Generalists &
Specialists), 3,125 Clerks and 439 Subordinate staff, thereby
inducting a total of 6,249 new employees in the Bank during
the period 2013-2014 The recruitment process is continued
in the year 2014-15 also with various recruitment projects
undertaken for filling up almost 3,800 posts of officers and
3,800 posts of clerks.
Formulation of Talent Management System
With a view to identify and groom young potential leaders in
the Bank so that they can go on to man the critical leadership
positions and thereby fill up the foreseen leadership gaps
in future, your Bank has taken a big stride of designing
and implementing a well orchestrated Talent Management
System. This system proactively identifies future potential
leaders based on various criteria and also grooms them
through a systematic developmental plan for each of the
identified future leader.
This is an annual exercise and in FY14, your Bank was able
to clearly identify around 20% people in specific scales of
Officers viz. in Scales II, III, IV, V and VI as the future leaders.
Framework for Career Progression
Concerted efforts have been taken by your Bank for fostering
the career progression of employees primarily to reward
them for their efforts and performance and also to motivate
them further to climb up the corporate ladder and thereby
fulfill both organizational as well as personal aspirations.
Your Bank not only provides opportunities for upward
movement in the hierarchy but also ensures horizontal
movement of officers across different functions to provide
them wider exposure and carve out a definite career path
Akin to recent years, in FY14 also, promotion exercise in all
the cadres was conducted and a total of 3,525 employees
as shown in the table below were promoted to higher grade/
Sub-Staff to Clerk
Clerk to Officer
JM-I to MM-II (Officer to Manager)
MM-II to MM-III (Manager to Sr Manager)
MM-III to SM-IV (Sr. Manager to Chief
SM-IV to SM-V (Chief Manager to Asstt. Gen.
SM-V to TEG-VI (Asstt. Gen. Manager to Dy.
TEG-VI to TEG-VII (Dy. Gen. Manager to
Employee engagement and Rewards
To augment the engagement levels in the employees for the
higher motivation and productivity, your Bank has recently
formulated a policy on “employee engagement”. As part
of this policy various initiatives like conduct of satisfaction
surveys, workshops for interaction of juniors and seniors
etc., are undertaken to improve the employee connect with
HR and top management.
To promote a culture of performance and to reward the top
performers, your Bank has very recently launched a revised
performance linked incentive scheme for its employees.
Implementation of HR Technology
Your Bank has put in place a very comprehensive HR
technology platform covering HRM, Training, Payroll &
Leave modules christened as the “Human Resources
Network for Employee Services (HRNes)”. This
technology platform has enabled automation of various HR
functionalities and processes. The HR Automation is a key
enabler in the implementation and sustenance of various
HR initiatives and certain processes have completely
been automated thus enhancing the efficiency of the HR
operations thereby reducing the turnaround time.
In addition to the above HR interventions, the setup of the
HR function in your Bank has also been strengthened further
during FY14 and made more efficient by centralization of
the routine administrative activities into a HR Back-office.
Special Thrust on Development of SC/ST/Other
Your Bank is committed to the constitutional safeguards and
social objectives for development and welfare of persons
belonging to SCs, STs and Other Backward Classes in
the Indian society. Your Bank is one of those banks in
the entire banking industry that has the highest number of
employees belonging to SCs and STs, which itself shows
the commitment of the Bank towards their development and
upliftment. Some of the highlights of your Bank’s efforts for development and welfare of people belonging to SCs and
STs are enumerated as under.
1. Reservation in Employment
Your Bank observes all guidelines stipulated by
the Government of India for reservation of posts in
employment in All India recruitment and local recruitment.
Around 15% of total posts are reserved for SCs and
7.5% posts are reserved for STs in all India recruitments
as also for selection to Baroda Manipal School of
Banking, it being another channel of resourcing started
by the Bank. For other recruitments made on regional
basis, appropriate percentages prescribed for various
States are being observed. Special efforts are made
like offering pre-recruitment orientation training to SC/
ST applicants for recruitment in your Bank. Relaxation
in age limit and qualifications are given and interviews
of SC/ST candidates are taken on relaxed standards
in order to ensure that appointment of candidates to
the reserved posts happens. In the interview panel for
recruitment, a member belonging to SC/ST is invariably
associated. Candidates belonging to SC/ST, who are
called for interview, are reimbursed traveling expenses.
In addition to providing reservation in employment, your
Bank is also providing reservation and other enabling
mechanisms in career growth and promotions for SC
and ST employees as per the guidelines in vogue.
Pre-promotion training is also being given before
such candidates’ participation in promotion exercises.
Moreover, around 10.0% of the available residential
accommodation of your Bank is reserved for SC/ST
The staff strength and representation of SCs and STs
as of 31st March 2014 is as under
2. Reservation Cell
An exclusive Reservation Cell in your Bank has been
set up to monitor the reservation and other enabling
provisions for SC/ST employees. An executive in the
rank of General Manager is appointed as Chief Liaison
Officer for SC/ST/PWD & EX-Serviceman employees
who ensure compliance of various guidelines pertaining
to the SC/ST/PWD & EX-Serviceman employees. A
Liaison Officer for SC/ST has been appointed in each
Zone of your Bank who takes care of all matters and
grievance redressal of SC/ST employees of that Zone.
3. Meeting with SC/ST Welfare Association
With a view to have direct dialogue and review of
reservation and other special provisions for SC and
ST, your Bank holds quarterly meetings with the representatives of SC/ST Welfare Association of the
Bank at Corporate level. Your Bank’s Chairman and
Managing Director and Senior Executives including the
Chief Liaison Officer for SC/ST/PWD & Ex-Serviceman
participate in the meeting.
4. Bharat Ratna Dr. Babasaheb Ambedkar Memorial
Your Bank has established the “Bharat Ratna Dr.
Babasaheb Ambedkar Memorial Trust” in 1991 for
promoting welfare activities for the benefit of SC/
ST employees and their family members. Apart from
scholarships to children of employees belonging to
SC/ST, this Trust also provides scholarship to needy
students belonging to SC/ST community, in general, in
major centres of the country.
5. Visit of National Commission for Scheduled Castes
During the year FY14, the National Commission for
Scheduled Castes visited your Bank at Bhubaneshwar
on 22nd October, 2013 and at Guwahati on 26th October,
2013. The suggestions and guidance of the Commission
are being scrupulously observed by your Bank.
Due to the Bank’s all out efforts in the HR sphere, your Bank
is yielding positive recognition in the employers market which
can be testified by the fact that Bank of Baroda has become
the most preferred PSU Bank for new recruits as per the IBPS
Rankings in 2013. We are confident that the HR initiatives
will definitely lead to enhanced employee productivity and
enable building of a long term and sustainable HR platform
by upgrading HR skills, leveraging the full potential of the
Bank’s human capital and implementing cutting edge HR
policies and processes through use of technology.
A Dedicated Cell for Training & Development
Looking to the importance of Training and Development in
the context of large scale recruitment in the Bank combined
with the need for grooming of the existing work force in the
context of the growing competition, your Bank created a
new cell for “Learning” and a new functional position as
Chief Learning Officer (CLO) in the Bank during FY14.
The CLO is of the level of a General Manager and supports
the organization through learning interventions.
The broad mandate of this new vertical is as follows.
Institutionalizing and enhancing E-learning for effective
Fostering a learning environment across the
organization through innovative interventions.
Helping customers to understand and use your Bank’s
products and services through customer education.
Aligning training with operational priorities by designing
suitable courses through collaboration with other
Steering the Baroda Academy towards the objectives
for which it was set up.
Your Bank has 15 training establishments spread all over the
country including its apex Staff College at Ahmedabad. The
Staff College has successfully completed its glorious journey
of 49 years and stepped into the Golden Jubilee year on
21st November, 2013. Golden Jubilee year was launched
by your Bank’s Chairman & Managing Director on the same
day. A series of learning events took place throughout the
year to commemorate the Golden Jubilee year. During the
year, a new Training Centre was commissioned at Bangalore.
Faculty members of the Bank have authored good number
of research papers that were presented in national and
international conferences and subsequently published as
The training system in your Bank extensively uses case
study methodology and has built up a pool of case studies
developed by faculty members to make training highly
experiential and simulation-based.
A good number of innovative steps have been taken by the
Bank in the domain of training over the years. The training
system of your Bank bagged a National Award for Innovative
Training Practices in various industries by securing third
position, awarded by the Indian Society for Training &
Development (ISTD) during the year FY14.
Large Scale Training on Products
Your Bank carried out a campaign called “ASCEND” for
large scale product training to impart product knowledge
to the front line officers on Retail Liability, Retail Asset and
e-Business products. The campaign was run entirely by
the trainers and operational bankers, and it covered 5,987
employees amounting to about 95% of the target group.
Similarly two rounds of All India quiz christened “Baroda
Gyani” were organized to bring more awareness on product
knowledge. More than 4,000 employees from sub-staff
to officers participated in this competition upgrading their
product knowledge. E-learning modules on retail products
were also launched for this purpose.
Adoption of new Training Policy
Your Bank has a Board approved comprehensive training policy. It covers entire spectrum of training activities
that include a) laying down streamlined processes, b)
a full-fledged training structure, c) capacity building, d)
measurement of training efficacy and, e) intervention
Special Thrust on Development of SC/ST/Other
Your Bank is committed to the constitutional safeguards and
social objectives for development and welfare of persons
belonging to SCs, STs and other backward classes in the
Society. Around 49 programmes covering 1,221 SC and
573 ST employees were conducted during FY14 to prepare
them for promotion exercise. Similarly, 9,602 SC employees,
3,795 ST employees and 10,292 OBC employees were
imparted training during FY14 in various key banking areas.
Training to Customers: “Customer Connect”
As part of customer education, the training system ran
a campaign during Feb-Mar 2014 to impart training to
customers for using net banking and mobile banking
services. More than 15,342 customers were trained at
various centres and the initiative will continue throughout
the calendar year.
Capability Building Initiatives
To build knowledge power of its employees, your Bank has
been focusing on comprehensive grooming of the staff in
key banking areas like credit, forex, Priority Sector, Retail
Banking, CBS, Financial Inclusion, Risk Management
etc. Besides, your Bank conducts comprehensive training
programme called “On-Boarding Programme” for newly
recruited officers and clerks using in-house resources and
through a tie-up with reputed external agencies. The Bank
conducted more than 2,337 in-house training programs
during the year FY14 covering 49,044 participants in addition
to the external training of officers and executives at various
business schools in India and abroad. Your Bank is at an
advanced stage to take the next big step in the area of
e-learning to augment its capabilities to reach out to every
During FY14, around 988 staff members were nominated to
various external training programmes. Your Bank considers
External Training an integral part of capacity building,
wherein employees at all levels are exposed to such
programmes to learn and adopt the best practices existing
in the industry.
Some of the noteworthy and dedicated programmes
organised during the year FY14 were:
Top Management Programme for General Managers
and Deputy General Managers of your Bank at ISB,
Hyderabad from 13th to 18th May 2013.
Top Management Programme for two batches of newly promoted Assistant General Managers and Chief
Managers at International Management Institute (IMI),
New Delhi from 13th to 17th May 2013 and from 20th
to 24th May 2013.
A Leadership Development Programme for newly
promoted Assistant General Managers of the Bank
from 7th to 12th October 2013 at Centre for Organization
Integrated Treasury Bourse Programme in association
with Trinity Academy, Mumbai from 26th August to 5th
September 2013 for treasury officers.
Talent management training on ‘Communication and
Influence’ and ‘People Development and Team Focus’
for the identified officers during Oct-Dec 2013.
Executive Development Programme on Rational
Emotive Behaviour Therapy (REBT) from 5th to 7th
December 2013 at University of Mumbai.
A dedicated Programme for Agriculture Officers of your
Bank from 2nd to 7th December 2013 at Manipal Academy
of Banking, Bangalore.
Nearly 3,000 new clerks were on-boarded in tie-up with
NIIT-IFBI thus covering all the new clerks who joined the
Bank post June, 2013. More than 800 existing clerks
were trained under a refreshers’ course “UTKARSH”
A programme on “Positive Approach to Vigilance
Administration for Disciplinary Authorities” on 18th & 19th
October 2013 at New Delhi.
A Faculty Development Programme was conducted
from 16th to 21st December 2013 by M/s Fourth Quadrant
Training Pvt. Ltd.
Business Process Re-engineering (Project
Ever since your Bank changed its brand identity, there
has been a tremendous growth in its brand recall value,
which in turn gave rise to enhanced expectations from all
stakeholders. The expectations were further strengthened
by your Bank’s tag line as India’s International Bank and its
mission to be a ‘National Bank of International Standards’.
However, your Bank has responded well to these
expectations by restructuring its products and processes
in an optimum fashion.
Actually, the process of change began with the setting up
of Retail Loan Factories in 2007. Subsequently, your Bank
commissioned a comprehensive change programme in June
2009 that sought to rebuild the Bank for the future under the
name Project Navnirmaan.
This project touched all aspects of your Bank‘s processes,
structures and systems with an objective to simplify
processes, improve branch productivity and provide bestin-
class service to its customers.
The change programme has been successful and this
initiative has been one of the major factors to help your
Bank bag a number of awards and accolades establishing
itself truly as India’s International Bank.
The major achievements under the project Navnirmaan
during FY14 are enumerated as under.
• Baroda-Next Branch: Around 1,433 metro and urban
branches have been rolled out as Baroda Next branches
in your Bank until end of FY14.
• Branch Front-end Automation: The Queue
Management System (QMS), Cheque Deposit Machines
and Personalized Pass Book Printers were installed in
9,840 and 1,200 branches, respectively.
• City Back Office (CBO) : Clearing operations were
centralized for all branches (linked to CBO). At present,
there are 85 CBOs operational throughout the country.
• Regional Back Office (RBO) : Two RBOs at Bareilly
and Ahmedabad were added during the year taking
the total strength to 12. Altogether 3,653 branches are
linked for CASA opening and 4,263 branches linked for
PCB (Personalized Cheque Book) issuance.
• Credit centralization Pilot (RLF/ SMELF) : The Retail
and SME credit centralization pilot of your Bank initiated
in FY14 is under progress at the Loan Factories in
• Sustainability of NAVNIRMAAN initiatives/impact: Process Compliance Audit (PCA) - A certification
procedure for Baroda Next branches was introduced
through which process compliance/adherence by
branches are being evaluated by your Bank’s inspecting
officers. Till date, 907 branches have been covered
under the PCA.
• Train the Trainers Programme: A two days’
programme was held at Staff College Ahmadabad
from 29th to 30th June, 2013– in connection with holding
workshops at all zones for branch heads, sales heads,
relationship managers, customers service and branch
hosts of Baroda Next branches.
• Change Leader–cum-RBDM Conclave: A two days’
conclave was held at Staff College, Ahmadabad during
12-13 August, 2013.
• Contact Centre:: Your bank has two Contact Centres
at Lucknow and Vadodara. In addition to the existing
basket of service, Mobile Banking assistance service
has been added during the year. The service timing
has been increased to 6am to 10pm (from earlier 8am
to 8pm) for better customer convenience.
• E- Lobby: Your Bank has started 45 independent
E-Lobbies in different zones. It offers the following six
services- Cash Dispenser (ATM), Bunch Note Acceptor
(BNA), Self Service Automatic Passbook Printing Kiosk,
Cheque Deposit Machine (CDM), Internet Banking Kiosk
and Phone Banking facility.
• Innovation Committee: With a view to encourage
a culture of innovation across the organization, your
Bank set up an Innovation Committee in March 2014
with the following objectives - developing new products
and services, innovation in internal processes that add
value to customers and the Bank, innovation in service
delivery that delights the customers.
During FY14, your Bank continued to promote its brand and
various products and services through various marketing
initiatives. This involved effective utilization of different media
vehicles such as Print, Electronic (TV, Radio, Online etc.)
and OOH, apart from supporting the “Below-the-Line” (BTL)
activities undertaken by the Zones and Regions.
The highlights of various marketing / communication
activities undertaken during FY14 are given below:
Your Bank, encouraged from the success of its initiative of
FY13 i.e. BRAND Engagement Program, launched the next
edition of ‘Bank of Baroda Canvas Competition’ during
January 2014 to continue and harness the potential of longterm
relationship formed with the younger audience as well
as their influencers i.e. parents and teachers. This year
again the momentum was to build long-term relationship
with both existing and new educational institutions and as
such, students across the country were invited to submit their entries through their respective schools on a predetermined
topic and winning entries were selected on
National/Regional levels by a select panel of judges. The
brand-association formed with the target audience through
involvement of the Bank’s mascot i.e. ‘Stickman” increased
significantly this year and participants were invited to name
the stickman. A judicious mix of on-ground activities at the
Zonal and Regional levels were used in the campaign to
maximize the number of entries in the said competition.
In addition to the above initiative, your Bank undertook
various Product Promotion Campaigns to promote its
products and services amongst target audience through
advertising across different geographies. Besides focusing
on providing information on various products and services,
particularly Saving Deposits, Current Deposits, Home
Loans, Car Loans and SME Loans, new product-lines like
Consumer Durable loans and Alternate Delivery Channels
(ADCs) were aggressively promoted. Furthermore, special
customer segments were also targeted viz; Special
Campaigns for Doctors and NRIs etc. through judicious use
of various media vehicles on Pan India basis. Information
relating to expansion of branch network, both domestic and
overseas, was also given due publicity largely through print
medium which helped enhancing your Bank’s brand image
Your Bank also participated in various events such as Pravasi
Bhartiya Diwas 2014, FICCI-IBA Banking Conference
2013, World Ranking Snooker Tournament–Indian Leg,
India– Australia Cricket Series 2013, MINT Annual Banking
Conclave, BKC Financial Institutions Employees Marathon
and Standard Chartered Mumbai Marathon 2014, among
many other events to continue the brand association with
the customers and stakeholders thereby increasing the
During FY14, as part of its public relations task, your Bank
had wide media coverage of its activities across the country,
which helped in enhancing your Bank’s brand image.
Awards and Industry Recognition for Bank
Your Bank won several awards and recognitions during
FY14 from the reputed media houses and other prestigious
organizations on various business and financial parameters
for its steady and all round performance, superior
management thereby contributing to the growth of the
Given below are some select awards won by your Bank
during the year FY14:
Your Bank’s Chairman & Managing Director Shri S S
Mundra, ranked 41st in the list of Top 100 India Inc’s
Most Powerful CEOs as per CD-ET (Corporate Dossier-
Economic Times) Inc’s Survey 2013, published in
Economic Times issue dated 12.07.2013. He was also
ranked 3rd amongst CEOs of Public Sector Banks as
per the survey.
Your Bank ranked 20th amongst ‘Best Indian Brands’
– Brand Equity Economic Times Survey. This was
published in Economic Times issue dated 31st July
Your Bank won a Special Award for Best IT Team
among Public Sector Banks at IDRBT Banking
Technology Excellence Awards 2012-13.
Your Bank was recognized as the Best Public
Sector Bank under the category ‘Global Business
Development’ by Dun & Bradstreet – Polaris Financial
Technology Banking Awards 2013.
The Reserve Bank Rajbhasha Competition, 28.08.2013,
Mumbai gave your Bank the following prizes.
a) First Prize in Region ‘C’
b) Second Prize in Region ‘A’ & ‘B’
c) Third Prize for ‘AKSHAYYAM’ in Hindi House –
Bilingual House Journal Competition
d) Third Prize for ‘BOBMAITRI’ in – Bilingual House
- The Sunday Standard Best Bankers’ Awards – Best
Banker – HR constituted by The New Indian Express
Group, was conferred on Shri S S Mundra, Chairman
& Managing Director of your Bank during FY14.
- Your Bank received an award in Indira Gandhi
Rajbhasha Shield Competition, 14.09.2013, New Delhi.
- First Prize for the Year 2011-12 was given for your
Bank’s exemplary performance in Official Language
- In the ASSOCHAM 9th Annual Banking Summit–cum-
Social Banking Excellence Awards 2013, 16.09.2013,
New Delhi, your Bank was the Winner in Public Sector
Banks Category in recognition of its distinguished and
commendable work done in the field of ‘Social Banking’.
- Your Bank improved its ranking from 66th to 52nd in
The Asian Banker - Region’s Largest Bank category, in
September 2013 special issue 122 of The Asian Banker.
- Your Bank won the following awards during the 53rd
Annual Awards Nite of the Association of Business
Communications of India (ABCI), 18.10.2013, Hotel
Taj, Colaba, Mumbai.
a) Special Column (English) – BronzeTrophy for
b) Special Column (Language) – Silver Trophy for
Apni Baat – Akshayyam
c) Headlines – Bronze Trophy for Corporate Ad
- Your Bank was ranked No.3 in THEBWReal500 –
India’s 50 Biggest Financial Companies published in
Business World Issue dated 04.11.2013.
- Your Bank was ranked No.50 in BT500 India’s Most Valuable Companies published in Business Today
November 10 2013 issue.
- Your Bank was rated as the 3rd Fastest Growing Large
Bank and 4th ‘Best Bank – in Large Bank Category’ in
a Survey of India’s Best Banks by - BW-PwC Survey.
This Survey was published in Business World issue
dated 30th December 2013.
- Your Bank was ranked 22nd in Brand Equity Top
Service Brands published in Brand Equity Issue dated
18.12.2013, retaining its brand ranking position as that
of last year.
- Your Bank was ranked 28th in Fortune India 500 lists
published in Fortune India Magazine Special issue
- Your Bank received the MSME Banking Excellence
Award – 2013 as the Best Bank in MSME by Chamber
of Indian Micro Small and Medium Enterprises on
09.01.2014 at New Delhi.
- Your Bank was ranked 27th in India’s Biggest 500
Companies – Top 500 company listing 2013 published
in ET 500 Magazine issue January 2014.
- Your Bank was awarded “Best Bank - Public Sector” by
ABP News in Banking, Financial Services & Insurance
Awards on 14.02.2014 in Mumbai.
- Your Bank was awarded for “Excellence in Banking
(PSU)” by My FM Stars of the Industry award on
14.02.2014 in Mumbai.
- Your Bank was awarded for “Excellence in Home Loan
Banking” by My FM Stars of the Industry award on
14.02.2014 in Mumbai.
- Your Bank received the ‘Global Excellence & Leadership
Award’ in the category of ’50 most talented CSR
Professionals of India’ by World CSR Congress in
Mumbai on 18/02/2014.
- Your Bank was ranked 53rd on Net Revenue and 45th
on Market Capitalization in FE 500 list published in
Financial Express Magazine February 2014 issue.
- Your Bank was ranked No.1 in the Public Sector
Bank Category in FE-EY Best Banks Survey 2012-13
published in The Financial Express Magazine March
- Your Bank’s Eastern UP Zone, Lucknow was awarded
the 1st Prize by Government Of India for Implementation
of Official Language (Hindi) in Banks for the year 2012-
13 by Official Language Dept, Ministry of Home Affairs,
Government of India at a function held in Chandigarh.
Premises Re-Engineering and Ambience
The major achievements of your Bank in the area of
“Premises re-engineering and ambience enhancement”
during the year FY14 are as given below.
- Construction of office building cum currency chest at
Varanasi was completed. This building is equipped
with ultra modern gadgets and systems with energy
efficient equipments and rain water harvesting system.
The eco-friendly materials were used in its construction.
Your Bank’s presence by this building in Varanasi is
admired by one and all. Now, it has become one of the
landmark buildings of the city.
- As per the directives from Ministry of Finance, your Bank
linked its corporate office with all zonal and regional
offices through State-of-the Art Video Conferencing
(VC) systems based on MPLS Connectivity. Interaction
of functional heads through VC has made the decision
making process more efficient, quick and cost effective.
- During FY14, your Bank adopted all technology centric
initiatives in the form of e-tendering, e-procurement etc.
and this was implemented in a phased manner.
You Bank ensured that all payments to vendors are
made through RTGS/NEFT.
- In tune with your Bank’s policy to have its administrative
offices in owned premises, your Bank purchased land
at Bangalore (Karnataka), Hyderabad (AP), Faizabad
(UP) Indore (MP), Udaipur (Rajasthan), Dehradun
(Uttrakhand), Jaipur (Rajasthan) and New Raipur
(Chhatisgarh), Bareilly (UP) and Ernakulam (Kerala) for construction of commercial /residential buildings.
- Looking to the ever increasing rentals, area optimisation
of every corner of the available premises is being
ensured by your Bank. Layouts are being revisited
while renovation and furnishing of branches and
offices is being done by introducing eco-friendly and
ergonomically designed sleek furniture items. The area
norms for acquisition of the premises have also been
reviewed and implemented.
- To have uniformity in systems and procedures pan-
India, Premises Policy Guidelines, Constructions
Manual, Refurbishment Manual were designed and
formulated. Agencies have been identified for quick
procurement of the furniture items and to have similar
and identical design to get aesthetically pleasant look
and vibrant indoor environment.
Projects implemented during FY14
The construction of office building cum currency chest
Construction of residential complex at Janakpuri, New
The construction of multi-storey integrated office
building at Jaipur.
Construction of BSVS at Ajmer, Dunga rpur, Banswada
The setting-up of e-lobbies at 45 various locations in
Your Bank purchased residential flats at various places
for newly transfered officers.
Projects under implementation
Construction of BSVS at Alirajpur, Jaipur, Surat,
Bharuch and Jhabua.
Construction of administrative and residential buildings
at New Raipur.
Construction of residential cum commercial complex
at Indore (MP).
Construction of own building for Disaster Recovery Site
Renovation of Bank of Baroda Institute of Information
Technology at Gandhinagar (Gujarat).
Construction of Regional Office Building at Faizabad.
Renovation of residential building and flats at Nehru
Future Plans for Estate Management
To facelift the Bank’s Building at Parliament Street,
To redevelop the Bhandup Staff Quarters building,
Mumbai, thereby to construct about 138 residential flats
for transfered officers/executives.
The redevelopment of Jogeshwari Staff Quarters,
Mumbai, to construct a building for residential and
To construct the training centre at Bangalore.
Construction of BSVS at various centres across India
as per the directives from the Government of India.
To set up the Baroda Academy (i.e., training Centre) at
Gandhinagar (Ahmedabad), Bangalore, Greater Noida
Brick & Mortar Branch Expansion
Given below is the information on your Bank’s brick and
mortar distribution channels as on 31st March, 2014, which
is observed to be closer to common customers as compared
to the E-Banking channels that are generally preferred by
the tech savvy urban masses.
% Share in
Domestic Subsidiaries and Associates
The performance of your Bank’s Subsidiaries, Joint Ventures
and Associates was quite satisfactory during FY14.
BOBCARDS Ltd. turned around during FY11 due to the
recovery in NPA accounts. Subsequently, it posted profits
during FY12 and FY13. During FY14, the company focused
on all qualitative aspects of business development, which
resulted in better profitability, quality card base and ME
base. The Company introduced a range of Titanium Cards,
Signature Cards, Assure Cards, Corporate Platinum Cards
and Bobcards Elite with premium features like added
privileges and offers. Special schemes for corporate
and HNI customers were also launched during the year.
The Company has drawn up aggressive plans for the
enlargement of Card and Merchant Base for the coming year.
BOB Capital Markets Ltd. was professionally strengthened
during the year by deputing a team of Project Finance
Department and embarked upon undertaking technoeconomic
viability (TEV) studies, debt restructuring and
corporate finance services on a large scale for various
customers. Throughout the year, the focus remained on
investment advisory services, debt and equity syndication
and capital market activities. The Company commenced
institutional broking business and also launched an Online
Institutional Trading platform from October 2009. The
On-Line Retail Trading platform, which was commercially
launched on July 20, 2012 was extensively modified to
make it much simpler and easier to use by customers to
have the benefit of user-friendly retail trading platform. The
company, functioning in a very competitive market, is ever
alert to opportunities in the market and is poised to grow
bigger in the coming years.
The Nainital Bank Ltd. was promoted by Late Bharat
Ratna Pandit Govind Vallabh Pant and others and became
Associate Bank of Bank of Baroda in the year 1973. Today,
the shareholding of Bank of Baroda in Nainital Bank Ltd.
is 98.57% and is a subsidiary of the Bank. The State of
Uttarakhand, vide its communiqué dated August 3, 2012,
has notified that The Nainital Bank Limited be treated at
par with other PSU Banks. The Bank has initiated branch
expansion initiatives and has already established a Regional
Office at Dehradun and has aggressive plans to ramp up its scale of operations. The Bank has launched e-stamping
facility in 15 branches and has initiated several new IT
initiatives e.g Mobile banking & e-banking etc. The Bank
also took various initiatives to increase its retail segment
particularly in housing loan & consumer loan to high income
salaried employees of Government Departments & PSU as
well as professionals.
Baroda Pioneer Asset Management Company Ltd. a joint
venture with Pioneer Global Asset Management SpA, is in
its sixth year of operation. During the year under review,
the Company was able to strengthen its AUM (Asset under
Management) significantly which rose by 75.0% on year
on year basis as of March’14 and was able to add one lakh
folios despite weak sentiments prevailing in both debt and
equity markets. The key to this growth was strong focus
on the institutional segment which helped the Company to
grow its debts and money market products coupled with
focus on Systematic Investment Plans (SIPs) for retail
investors. The Company has increased the number of
investor servicing points from 77 to 203 during the year.
There was a substantial growth in Company’s average
assets under management (AAUM) during the year which
has placed it among the top 20 mutual funds in India and is
ranked 19th for the month of March, 2014. The Company’s
(AAUM) growth was robust on year on year basis and was
at 11% whereas industry growth was at 10.0%, as per the
AMFI (Association of Mutual Funds of India) website. With
equity markets remaining volatile, SIPs continue to be one
of the best ways for the Company to channelize customers’
savings into the equity market.
IndiaFirst Life Insurance Company Ltd., a joint venture
company with Legal & General group, commenced its
business operations on 16th November 2009 and has
received an overwhelming response for its products across
the country. The Company has won Model Insurer Award
(Asia) for the three successive years. IndiaFirst garnered
new business registering a year on year growth of 67.0%.
Its industry-wide new business ranking improved from 9th
position last year to 7th position in the current year (Feb ’14).
Increase in the new business (NB) premium has improved
the market share from 3.0% last year to 5.0% current year
(Feb ’14). Number of customers grew by 46.0% year on year
on account of new distribution tie-ups which include RRBs/
NBFCs/Brokers through Alternate Channel Distribution.
Renewal collection grew by 23.0% year on year leading
to increase in premium income for the Company and
subsequent increase in the policy and premium persistence.
The Company’s total revenue increased by 46.0% (y-o-y).
Company’s major initiative with the Bank includes launch of
premium option through mobile banking for Bank of Baroda
customers and financial inclusion branch module.
India Infradebt Limited is a joint venture company
with ICICI Bank Limited, ICICI Home Finance Company
Limited, Citicorp Finance (India) Limited and Life Insurance
Corporation of India. The Company was incorporated
on October 31, 2012 in Mumbai and has been issued
registration certificate No.N-13.02039 dated 08.02.2013 by the Reserve Bank of India to operate as an Infrastructure
Debt Fund – Non Banking Financial Company (IDF-NBFC).
The Company’s principal activity is to re-finance part of the
debt liabilities of the Project Companies.
India Infradebt Limited (Infradebt) is India’s first Infrastructure
Debt Fund structured as Non Banking Financial Company
(IDF-NBFC). Infradebt closely worked with National
Highways Authority of India, Ministry of Finance (MoF)
and Ministry of Road Transport & Highways towards the
successful implementation of IDF framework.
During the year, it became the first IDF-NBFC to be rated
“AAA” by CRISIL in July 2013 for its proposed debenture
issue. Subsequently, in December 2013, ICRA also
assigned a rating of AAA to the debenture issue programme
of Infradebt consequent to the efforts of Infradebt in
convincing various authorities.
Infradebt is primarily focusing on sectors like roads and
ports. During the year, the Board Credit & Risk Committee
has approved provision of financial assistance to a few
proposals in the roads sector, in addition to the sanction
provided to HEL (Himalayan Expressway Ltd.). Furthermore,
Infradebt would constantly keep identifying additional
projects for takeout financing and envisages closing
additional transactions over the next few months.
Baroda Pioneer Trustee Company Pvt. Ltd. Baroda
Pioneer Trustee Company Pvt. Ltd. is the trustee to Baroda
Pioneer Mutual Fund. As a trustee, the Company ensures
that the transactions entered into by Baroda Pioneer Asset
Management Company Limited are in accordance with the
SEBI (Mutual Funds) Regulations, 1996 and also reviews
the activities carried on by the AMC.
| (Rs lakh)
Entity (with date of
Trustee Co Pvt
Insurance Co. Ltd.
|The Nainital Bank
|India Infradebt Ltd.
Implementation of Official Language (OL)
During the period under review, your Bank made noteworthy
progress regarding implementation of Official Language
Policy of Government of India. Besides compliance of
various statutory requirements of Official Language Act
and Rules, your Bank took the initiative of promoting and
utilizing Hindi as a tool for establishing better connect with
customers and ensuring them the best possible service.
Your Bank prepared a well-structured annual action plan for
the achievement of various targets set by the Government of
India under its Annual Implementation Programme 2013-14
and the assurances given to the Committee of Parliament
on Official Language during its visits to various offices/
branches of the Bank. Through continuous monitoring and
regular efforts at various levels, your Bank could achieve
all the major targets of the Programme and fulfilled all the
assurances given to the Committee of Parliament on Official
The Meetings of Central Official Language Implementation
Committee, presided over by Chairman and Managing
Director of the Bank, were organized regularly on quarterly
basis. Under the guidance received from the Committee,
several new initiatives were taken during the year FY14.
Your Bank took a major initiative of automating the Quarterly
Hindi Progress report submission system in the Bank. The
Bank implemented ‘Pragati online package’ across the
Bank. The package was made available on the Bank’s
wide area network. All the operating units, administrative
offices were provided user ID and passwords for submitting
Rajbhasha Reports. Your Bank started sending systemsgenerated
letters pertaining to opening of accounts in
bilingual (Hindi-English) format through its Regional Back
Offices. Through this package, every month lakhs of letters
were generated in bi-lingual form which helped the Bank in
meeting to a great extent its targets set under the Official
Language programme. Your Bank brought more branches
under the coverage of an IT programme used to generate
and print pass-books and account statements in Hindi at
the branches situated in linguistic regions A and B. For the
convenience of customers, the facility of getting transaction slips in Hindi from ATMs was expanded further and now
majority of your Bank’s ATMs are covered under it. Your
Bank introduced display of screen in additional four Indian
Languages i.e Telugu, Tamil, Malyalam and Kannada
during the year. Your Bank also prepared an Inward-
Outward package viz. Document Management System for
maintaining records of inward/outward letters as per the
linguistic region-wise reporting requirements of its OL policy.
To increase financial literacy amongst masses, your Bank
prepared cartoon booklets, animation films in Hindi and
also in some regional languages on developing the habit
of saving, features of Kisan Credit Card and on the need
of timely repayment of loans. These cartoon booklets and
animation films were christened as “Chhoti Bachat badi
Khushhali”, “ Aam ke aam guthliyon ke daam” and “ Samay
Par Karj Ka Bhugtan, Jindagi Bane Aasaan” in their Hindi
edition. Marathi, Gujarati, Bangla, Punjabi editions of these
booklets/films were also released. These Booklets/animation
films were sent to Regional Offices/ Zonal Offices of the
Bank for their effective utililization.
Your Bank has been pioneer in spreading and promoting
the use of Hindi through the forum of Nagar Rajbhasha
Samitis. During the year under review, your Bank, with the
approval of Home Ministry, Government of India constituted
four new Nagar Rajbhasha Samitis. These committees are
functioning at Jodhpur, Rajkot, Surat and Bareilly under
the convenorship of your Bank. Nagar Rajbhasha Samiti,
Baroda and Jaipur are the oldest TOLICs (i.e., Town Official
Language Implementation Committees) working under your
The Third Sub-Committee of parliament on official language
visited your Bank’s branches/offices at Chitrakoot and
Anand. The Committee also reviewed efforts of your Bank’s
Corporate Office in its visit to Mumbai. The Committee was
full of praise of the efforts put in by your Bank for promotion
of the use of Hindi language.
Your Bank’s efforts were well recognised by Government of
India and Reserve Bank of India also. Government of India
awarded your Bank with the 1st Prize in the Indira Gandhi
Rajbhasha Shield Competition consecutively for the second
year. Your Bank’s Chairman and Managing Director (CMD) received this award from Honorable President of India at
a function held at Vigyan Bhawan, New Delhi on Hindi
Diwas 2013. Further, your Bank was awarded first prize
for ‘ C’ Region and second prizes for Region ‘A’ and ‘B’
by Reserve Bank of India (RBI) under the RBI Rajbhasha
Shield Competition. The Bank’s In-House Magazine
‘BOBMAITRI’ and Hindi Magazine ‘Akshayyam’ were also
awarded with the third prize by the RBI. Your Bank’s CMD
received these awards from the Governor of RBI. These
magazines also won two awards from Association of
Business Communicators of India.
Your Bank continued with its flagship scheme “Medhavi
Vidyarthi Samman Yojana” for popularising Hindi amongst
the students’ community. Under this scheme, cash prizes
and commendation certificates signed by your Bank’s CMD
are given to those students who have scored highest marks
in M.A.(Hindi). This scheme, at present, is applicable in 64
universities of the country.
Your Bank has published three books in Hindi during the
year viz.”Proudyogiki aur Grahak Seva”, “Thodi Si Dhoop”
and “Maharaja Sayaji Rao Gaekwad III”, for providing
qualitative reading material in the Hindi language.
Board of Directors
Shri Bhuwanchandra B. Joshi appointed as a Whole
Time Director (designated as Executive Director) w.e.f.
05.08.2013 by the Central Government u/s 9 (3) (a) of The Banking Companies (Acquisition and Transfer of
Undertakings) Act,1970, to hold office up to 31.12.2016
i.e. the date of his superannuation or until further orders,
whichever is earlier.
Dr. K. P. Krishnan, IAS, nominated as a non executive
Director, representing Government of India, w.e.f. 19-02-
2014, vice Shri Alok Nigam, IAS.
Shri Sudhir Kumar Jain appointed as a Whole Time
Director (designated as Executive Director) ceased to be
a Director with effect from 08.07.2013 on his elevation as
Chairman and Managing Director of Syndicate Bank.
Shri Ajay Mathur, a part time non- official Director/Non
executive director, ceased to be a Director with effect from
04.05.2013 on completion of his term.
Shri Satya Dev Tripathi, a part time non- official Director/
non executive director ceased to be a Director with effect
from 30.08.2013 on completion of his term.
Shri V.B. Chavan, a part time non- official Director / Non
executive director ceased to be a Director with effect from
31.01.2014 on attaining the age of superannuation.
Shri Alok Nigam, IAS, a part time non- official Director/
Non executive director ceased to be a Director with effect
from 18.02.2014 on the nomination of Dr. K.P. Krishnan,
IAS, in his place.
Directors’ Responsibility Statement
The Directors confirm that in the preparation of the annual accounts for the year ended March 31, 2014:
- The applicable accounting standards have been
followed along with proper explanation relating to
material departures, if any;
- The accounting policies framed in accordance with
the guidelines of the Reserve Bank of India, were
- Reasonable and prudent judgment and estimates were
made so as to give true and fair view of the state of
affairs of your Bank at the end of financial year and
of the profit of your Bank for the year ended on March
- Proper and sufficient care was taken for the maintenance
of adequate accounting records in accordance with the
provisions of the applicable laws governing banks in
- The accounts have been prepared on a going concern
The Directors express their sincere thanks to the Government
of India, Reserve Bank of India, Securities and Exchange
Board of India, other regulatory authorities, various financial
institutions, banks and correspondents in India and abroad
for their valuable guidance and support.
The Directors acknowledge with appreciation the assistance
and cooperation extended by all stakeholders of your Bank
like customers, shareholders and well wishers in India and
The Directors place on record deep appreciation for the hard
work and dedication of the members of your Bank’s staff
at different levels, which enabled your Bank to record high
quality, consistent growth year after year despite economic
challenges and consolidate its position as one of the premier
banks in the country.
For and on behalf of the Board of Directors,
S. S. Mundra
Chairman & Managing Director