Mar 31, 2021
The Board of Directors have pleasure in presenting the 52nd Annual Report together with the Balance Sheet as on 31st March, 2021 and Profit & Loss Account for the financial year ended March 31, 2021.
A snapshot of Bankâs financial performance is given below:Â Â Â Â (Rs. in Crore)
Particulars |
Mar-20* |
Mar-21 |
Global Deposits |
625351 |
1010875 |
of which -Â Domestic Deposits |
601664 |
963306 |
Overseas Deposits |
23687 |
47569 |
Domestic Deposits |
601664 |
963306 |
Current Account Deposits |
26458 |
49131 |
Savings Bank Deposits |
169749 |
281525 |
CASA Deposits |
196207 |
330656 |
Domestic CASA to Domestic Deposits (%) |
32.59 |
34.33 |
Global Advances |
451223 |
675155 |
of which - Domestic Advances |
426684 |
652558 |
Overseas Advances |
24539 |
22597 |
Total Assets |
723875 |
1153675 |
Net Interest Income (NII) |
13124 |
24062 |
Other Income |
7813 |
15285 |
of which - Fee Income |
2685 |
5243 |
Forex Income |
1115 |
1882 |
Trading Gains |
758 |
3316 |
Recovery from written off accounts |
1470 |
3032 |
NII + Other Income |
20937 |
39347 |
Operating Expenses |
11577 |
19338 |
Operating Profit |
9360 |
20009 |
Provisions |
11596 |
17452 |
of which - Provisions for NPAs & Bad debts written off |
10655 |
14168 |
Profit Before Tax |
(1756) |
3708 |
Provision for Tax |
480 |
1150 |
Net Profit |
(2236) |
2558 |
Figures are related to standalone Canara Bank financial results for pre-amalgamation period, hence not comparable with post amalgamation financial results for the year ended 31st March, 2021.
The global business of the Bank increased to '1686030 crore, with specific thrust on domestic business which grew to '1615864 crore as at March 2021. Domestic CASA deposits surged to '330656 crore with Savings Account deposits of '281525 crore and Current Account deposits of '49131 crore. Thus, domestic CASA improved to 34.33% as at March 2021.
Bank took various steps in respect of monitoring, control and maintaining asset quality. As on 31st March 2021, the Gross NPA of the Bank is at 8.93% and Net NPA is at 3.82%. Cumulative Cash recovery including recovery in written off accounts stood at '10918 crore. Further the provision coverage ratio has improved to 79.68% compared to last year. The healthy CRAR of 13.18% highlights that the Bank is well cushioned for an organic growth in the coming quarters. In FY 2020-21, operating profit of the Bank stood at '20009 crore and net profit at '2558 crore.
Bank is not eligible to pay dividend for the Financial Year 2020-21 on account of not meeting the eligibility criteria as stipulated by RBI for this purpose.
MANAGEMENT DISCUSSION AND ANALYSIS
Global economic output is recovering from the collapse triggered by COVID-19, although it will remain below pre-pandemic trends for a prolonged period. The pandemic has exacerbated the risks associated with a decade-long wave of global debt accumulation. It is also likely to steepen the long-expected slowdown in potential growth over the next decade.
As per the latest International Monetary Fund (IMF) estimates, the world economy is expected to grow by 6% y-o-y in 2021 Calendar Year and moderate to 4.4% y-o-y in 2022 after contracting by 3.3% y-o-y in 2020 on account of economic disruptions ensued from onset of the pandemic. The global growth projection is on the back of fiscal stimulus in few large economies, wider rollout of vaccination, particularly in the second half of 2021 Calendar year and continued adaptation of economic activity to subdued mobility.
The strength of the recovery is projected to vary significantly across countries, depending on access to medical interventions, effectiveness of policy support, exposure to cross-country spill-overs, and structural characteristics entering the crisis.
The domestic economy contracted by 7.3% in FY 2020-21 due to the unprecedented disruption in economic activity of the COVID-19 pandemic since March 2020. The nationwide lockdown and consequent standstill in business activities led to two consequent contractions in GDP growth rate in H1FY21. Growth momentum started picking up from 02FY21 onwards on the back of supportive fiscal & monetary policies and gradual easing of lockdown norms. However, as the second wave of the pandemic has again effected India, local lockdowns were in place in most of the states which is expected to slow down the recovery momentum in FY 2021-22. Keeping this in view, RBI has downgraded its growth projection for FY 2021-22 to 9.5% in its latest Monetary Policy Committee (MPC) statement from 10.5% as projected earlier.
The impact of the pandemic was disproportional across different sectors of the economy. While agricultural sector remained resilient in the face of the pandemic, services sector, being contact intensive was severely impacted. Manufacturing and construction sectors showed modest improvement in H2FY21 on the back of Government policy thrust on infrastructure development.
According to RBI's quarterly statistics on Deposits and Credit of SCBs, the Scheduled Commercial Banks (SCBs) credit growth (y-o-y) has decelerated to 5.6% in March 2021 as compared to 6.4% a year earlier, and aggregate deposits growth (y-o-y) accelerated to 12.3% in March 2021 from 9.5% a year ago.
However, the economic impact of the second wave is expected to be less severe as compared to the nationwide lockdown last year as lockdowns are localised in nature and there is acceleration in production and roll out of vaccination across the country. Rural demand is likely to remain resilient in view of good harvest and the prospects of a near normal monsoon forecast for 2021 by the India Meteorological Department. Services sector, being contact intensive, may remain subdued till broader normalisation of economic activities in the country. Industrial sector is expected to pick up pace with consumption demand gaining pace, particularly in H2FY22.
Going forward, GDP growth is expected to pick up pace with acceleration in vaccination drive, strengthening of healthcare infrastructure with support from a strengthening external demand in the global economy. Economic growth momentum is expected to strengthen in the second half of FY 2021-22 with recovery in economic activity becoming broader based across the different sectors of the economy, provided Covid spread is under check.
Since the onset of the pandemic from March 2020 onwards, RBI and Central Govt. of India have acted swiftly through a number of conventional and unconventional policy measures to contain the impact of the pandemic and ensuring financial stability, sufficient systemic liquidity and flow of credit to priority sectors of the economy.
RBI has reduced the policy repo rate by 115 bps to 4.00% since the start of the lockdown in 2020 and reduction in Cash Reserve Ratio (CRR) requirements by 100 bps to 3.0% of Net Demand and Time Liabilities (NDTL) which has now been restored to its pre-pandemic level of 4% of NDTL, effective May 22, 2021. Other measures are increase in marginal standing facility (MSF) borrowing from 2% of statutory liquidity ratio (SLR) to 3% and Open Market Operations (OMOs) including long term repo operations (LTROs), on-tap TLTROs aimed at specific sectors, Emergency Credit Line Guarantee Scheme (ECLGS) and postponement of implementation of prudential norms such as the capital conservation buffer (CCB) and the net stable funding ratio (NSFR), along with easing of liquidity coverage ratio (LCR) requirement.
In view of the need to support viable MSME entities on account of the fallout of COVID-19, the scheme of one-time restructuring of loans to MSMEs without an asset classification downgrade, was extended where the borrower's account was a 'standard asset' as on March 1, 2020 and the aggregate exposure of banks and NBFCs was not more than '25 crore. The restructuring had to be implemented by March 31, 2021, subject to certain conditions. The resolution framework 2.0 was introduced in recent monetary policy with enhancement of limit from '25 crore to '50 crore, subject to certain conditions.
Keeping in view the emerging economic conditions in the wake of the second wave of the pandemic, the central Bank has announced additional measures in its unscheduled special announcement on 5th May 2021 including term liquidity facility of '50,000 crore to ease access to emergency health services, Special Long-Term Repo Operations (SLTRO) for Small Finance Banks (SFBs) and exemption to banks for extending credit to MSME borrowers and relaxation in resolution framework for COVID related stressed assets of individuals, small businesses and MSMEs. Further, in its June 2021 meeting of MPC, RBI has announced on-tap liquidity window of '15,000 crore for contact intensive services sector and a special liquidity facility of '16,000 crore to SIDBI.
FY 2020-21 also witnessed expansionary fiscal policy of the Central Government like '20 lakh crore Aatmanirbhar Bharat yojana, special package for MSME and agricultural sector and moratorium on loan instalments from 1st March 2020 to 31st August 2020 to reduce stress on borrowers. The Union Budget for FY 2021-22 as announced on 1st February, 2021 has given a thrust on infrastructure, healthcare, agriculture, housing and the rural economy. Major budget outlays have been provided for infrastructure development with allocation of '5.54 lakh crore, '2.23 lakh crore for development of health infrastructure, '20000 crore for recapitalisation of PSBs, '15700 crore for MSMEs and income tax deductions for affordable housing projects along with many other initiatives to support economy.
STEPS TAKEN BY THE BANK AMID COVID-19 PANDEMIC
Banking sector in India underwent a paradigm shift in FY 2020-21, in terms of operating models in the wake of the COVID-19 pandemic since March 2020. Banks had to swiftly recalibrate their business processes to the pandemic protocols and restrictions to provide uninterrupted service to the customers while ensuring safety of both customers and employees.
Canara Bank as a responsible organization discharged the duties duly following the Covid-19 guidelines by taking required measures and taking it as utmost priority to safeguard the health of the customers as well as the employees.
In this regard, quick response teams and help desks have been setup at HO / CO / RO level, staggered working hours / rotation / work from home is being practiced as a part of Business continuity plan, immediate assistance of '1 lakh in case of hospitalization where cashless facility not available and interest free loan up to one month gross salary to meet medical expenses incurred, over and above the permissible insurance limit is being provided.
Bank is also arranging vaccination camps and quarantine facilities in tie-up with various hotels for the safety and proper medical care of the employees.
Digital channels have been used effectively to make the banking services available to the customers and services of Business Correspondents was stepped up along with doorstep banking services.
The Bank ensured that all its alternate delivery channels work uninterrupted. Further, foreseeing the depth of pandemic crisis, the Bank has taken all precautionary initiatives to ensure continuity in operations. The Bank has a Disaster Recovery site which is capable of handling the CBS and other functions of the Bank. In case of closure of Data Centre due to any unforeseen reasons, Bank will function from the Disaster Recovery Site.
The details of the financial impact of the pandemic are provided in the Notes on Account Section. As per the detailing, going forward, there would not be any significant impact on the Bank's financials.
Given the slowdown in economic recovery process in the wake of the second wave of the pandemic, the growth outlook is subdued for the near term and stable for the medium term. The economic growth momentum is expected to pick up in the H2FY22 with easing of localised lockdown norm across the states, expected broader normalization of economic activities and with wider rollout of vaccination process. The fiscal and monetary policy support will remain growth supportive in the coming year. The credit growth is expected to pick up in tandem with economic recovery.
The banking sector continues to serve as the backbone of the economy ensuring smooth recovery path. To strive for better performance in the coming years, the Bank gives thrust on shoring up of CASA while consciously reducing the reliance on bulk deposits. The Bank focuses on balanced advance portfolio with proper mix of retail, agriculture, MSME and corporate credit. The Bank has provided hundred per cent guaranteed MSME lending to give unrelenting support to this segment in tandem with government guidelines. The Bank takes adequate efforts for NPA management with ardent credit monitoring, contain fresh slippages and strengthen recovery efforts.
The Bank will continue to strive for process and product improvements in view of changing requirements and circumstances. In the coming years, the Bank looks forward for leveraging amalgamation benefits for maximizing the efficiency and productivity.
Canara Bank has remained resilient through the challenging times of the pandemic and has recorded good performance across all business parameters for the financial year ending March 2021. The Bank has achieved record 45% q-o-q growth in net profit to '1010 crore in 04FY21 and '2558 crore for the full FY 2020-21. The Bank has achieved robust growth in its major thrust areas, viz. balanced growth, optimal resource mobilization, robust fee income, expanding retail assets, including Agriculture, Housing and other retail segments, and improving asset quality.
During FY 2020-21, the global business of the Bank stood at '1686030 crore with global deposits at '1010875Â crore and global advances at '675155 crore.
(' in Croreâ
Global Deposits    625351    1010875
of which - Domestic
601664 Â Â Â 963306
Deposits
Overseas Deposits    23687    47569
Domestic Deposits    601664    963306
Current Account Deposits    26458    49131
Savings Bank Deposits    169749    281525
CASA Deposits    196207    330656
Domestic CASA to Domestic    ââ ââ
Deposits (%)
of which - Domestic
426684 Â Â Â 652558
Advances
Overseas Advances    24539    22597
*Figures are related to standalone Canara Bank financial results for pre-amalgamation period, hence not comparable with post amalgamation financial results for the year ended 31st March, 2021.
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Total Deposits stood at '1010875 crore as on March 2021. Domestic CASA deposits of the Bank is at '330656 crore as on March 2021 with Savings deposits at '281525 crore and Current deposits at '49131 crore. The Bank's domestic CASA deposits share to domestic deposits stood at 34.33%.
The focus on premier CASA products, like, Canara Galaxy, Canara Privilege, Canara Payroll, SB Powerplus and NRI accounts were given to improve the average balances under CASA. Total deposit clientele of the Bank stood at 10.41 crore as at 31st March, 2021.
The Bank expanded its asset base in a well-diversified manner encompassing sectors such as Agriculture and Micro, Small and Medium Enterprises (MSMEs) as well as keeping a focus on other retail assets, including Housing, Education, and Vehicle loans.
Advances (Gross) of the Bank reached '675155 crore as at March 2021. The number of borrowal clientele stood at 1.01 crore as at March 2021. Total business of the Bank increased to '1686030 crore for the year ended March 2021.
Operating profit of the Bank stood at '20009 crore for FY 2020-21. Bank reported a net Profit of '2558 crore for FY 2020-21. Net Interest income of the Bank stood at '24062 crore. NIM stood at 2.75% and Yield on Advances at 7.73%.
Key Financial Ratios (%) |
Mar-20* |
Mar-21 |
Cost of Funds |
5.12 |
4.09 |
Yield on Funds |
6.99 |
6.26 |
Cost of Deposits |
5.57 |
4.52 |
Yield on Advances |
8.18 |
7.73 |
Net Interest Margin (NIM) |
2.29 |
2.75 |
Return on Assets (RoA) |
(0.32) |
0.23 |
Return on Equity (RoE) |
(8.05) |
6.71 |
Cost to Income Ratio |
55.30 |
49.15 |
*Figures relating to standalone / consolidated Canara Bank financial results for pre-amalgamation period are not comparable with post-amalgamation financial results for the year ended 31st March, 2021.
During the year, total income is at '84525 crore, comprising '50405 crore interest from advances, '16859 crore interest from investments, '15285 crore from non-interest income and '1976 crore from other interest income.
Operating performance of the Bank    (' in Crore)
Key Financial Ratios (%) |
Mar-20* |
Mar-21 |
Interest Earned |
48935 |
69240 |
Interest Expended |
35811 |
45178 |
Net Interest Income (NII) |
13124 |
24062 |
Other Income |
7813 |
15285 |
of which - Fee Income |
2685 |
5243 |
Forex Income |
1115 |
1882 |
Trading Gains |
758 |
3316 |
Recovery from Written Off Account |
1470 |
3032 |
Operating Income (NII + Other Income) |
20937 |
39347 |
Operating Expenses |
11577 |
19338 |
Employee Expenses |
7134 |
12690 |
Other Operating Expenses |
4443 |
6648 |
Operating Profit |
9360 |
20009 |
Provisions |
11596 |
17451 |
of which - Provisions for NPAs & Bad debts written off |
10655 |
14167 |
Provision for Standard Advances |
379 |
1 |
Provision for Depreciation on Investment |
(278) |
427 |
Provision for Income Tax |
480 |
1150 |
Other Provisions |
359 |
1706 |
Profit Before Tax |
(1756) |
3708 |
Provision for Tax |
480 |
1150 |
Net Profit |
(2236) |
2558 |
*Figures relating to standalone / consolidated Canara Bank financial results for pre-amalgamation period are not comparable with post-amalgamation financial results for the year ended 31st March, 2021.
In line with the thrust areas for the Bank, non-interest income (Excl. Trading profit) is at '11969 crore. Apart from trading profit, other major sources of non-interest income, like, service charges ('2806 crore), commission and exchange ('1146 crore), recovery from written off accounts ('3032 crore) and profit from exchange transaction ('1882 crore) contributed to the non-interest income of the Bank. The share of non-interest income to total income stood at 18.08%.
Total expenditure of the Bank stood at '64516 crore in FY 2020-21. Interest expenses of the Bank is at '45178 crore. Operating expenses is at '19338 crore, comprising staff cost of '12690 crore and other operating expenses of '6648 crore.
Due to the decrease in interest rates, the Bank's cost of deposits is at 4.52%. The net interest income, the difference between interest paid and interest earned by the Bank, is at '24062 crore.
Networth of the Bank, as at March 2021 stood at '39814.26 crore. While the total paid-up capital of the Bank stood at '1646.74 crore, the reserves and surplus at '57238.19 crore.
Risk Weighted Asset    360906    530012
CET I (%) Â Â Â 9.39%Â Â Â Â 8.61%
AT I (%) Â Â Â 0.73%Â Â Â Â 1.47%
Tier I Capital    36529    53437
CRAR (%) (Tier I) Â Â Â 10.12%Â Â Â Â 10.08%
Tier II Capital    12727    16407
CRAR (%) (Tier II) Â Â Â 3.53%Â Â Â Â 3.10%
Total Capital    49257    69844
CRAR (%) Â Â Â 13.65%Â Â Â Â 13.18%
*Figures relating to standalone / consolidated Canara Bank financial results for pre-amalgamation period are not comparable with post-amalgamation financial results for the year ended 31st March, 2021.
Capital Adequacy Ratio, under Basel III was 13.18% as at March 2021 against the regulatory requirement of 10.875%, including capital conservation buffer of 1.875%. Within the capital adequacy ratio, CET I ratio was at 8.61% and Tier I capital ratio was at 10.08%.
During the Financial Year 2020-21, Bank has raised capital via Basel III compliant additional Tier 1 Bond amounting to '2936.10 crore and equity through QIP of '2000 crore and thereby Government of India shareholding in the Bank is 69.33% as on 31.03.2021.
In line with the thrust areas set for the year, the Bank's retail lending operations recorded good performance. The retail portfolio of the Bank increased to '115312 crore as on 31st March. 2021. The share of retail loans stood at 17.67% as of 31st March, 2021 of domestic advances ('652558 crore). This was possible as the Bank constantly strives to provide seamless credit delivery to customers in a hassle free manner.
(' in Crore) |
||
Retail Segments |
As at March |
|
2020* |
2021 |
|
1. Housing |
39611 |
64326 |
2. Vehicle |
10446 |
13713 |
3. Other Personal |
20320 |
24834 |
4. Education |
9423 |
12439 |
Core Retail Loans (1+2+3+4) |
79800 |
115312 |
*Figures relating to standalone / consolidated Canara Bank financial results for pre-amalgamation period are not comparable with post-amalgamation financial results for the year ended 31st March, 2021.
Over the years, the Bank has assisted substantial number of promising students to pursue higher education in India and abroad. The Bank's education loan portfolio increased to '12439 crore as at March 2021. The Bank has financed around 3.70 lakh students as at March 2021. During FY 2020-21, the Bank has disbursed education loans worth '1639 crore.
Among all Nationalized Banks, our Bank is in the forefront in extending education loans. Further, considering the huge thrust on skill development in recent years, "IBA Skill Loan Scheme" has been implemented to support skill development initiatives of Department of Financial Services (DFS).
The Bank has a special education loan scheme namely "Vidya Turant", Collateral free Education loans for the meritorious students who are admitted to premier institutes such as IITs, IIMs, ISB etc up to a limit of '40 Lacs with concessional rate of Interest, Bridge Loan Scheme namely "Vidya Sahay" to assist the needy and meritorious students who are in need of the down payment to be made to the CET / Counselling Authorities at the time of selection / counselling and "Vidya Shakthi", education loan scheme for the PWD category of students including expenses for specially designed equipment's for differently abled persons with concessional interest rate.
The Bank continues to accord importance to varied goals under national priorities, including agriculture, micro, small and medium enterprises, education, housing, social infrastructure, renewable energy, microcredit, credit to weaker sections and specified minority communities.
Priority Sector Advances of the Bank as at March 2021 reached '304803 crore and achieved 44.14% to Adjusted Net Bank Credit (ANBC) against 40% mandated norm.
Priority Sector    (' in Crore)
Priority Sector Advances |
As at March |
|
2020* |
2021 |
|
Total Priority Sector |
203029 |
304803 |
Agriculture |
97043 |
155990 |
*Figures relating to standalone / consolidated Canara Bank financial results for pre-amalgamation period are not comparable with post-amalgamation financial results for the year ended 31st March, 2021.
With a focus on credit delivery to Agriculture, the Bank's advances under agriculture portfolio was '155990 crore, covering over 1 crore farmers. Under agriculture lending, the Bank achieved 18.56% to ANBC against 18% mandated norm. During FY 2020-21, the Bank's agriculture credit disbursal is at '136978 crore.
Advances to Small & Marginal Farmers achieved 11.23% to ANBC as against the mandatory Target of 8% (Net of PSLC-SF/MF sale) as at March 2021.
During the year, the Bank issued 17.25 lakh Kisan Credit Cards (KCCs), amounting to '27480 crore. The credit outstanding under KCCs was at '38994 crore as at March 2021. 16.28 lakh Kisan RuPay Cards were issued against eligible accounts of 16.88 lakh, with an achievement of 96.44%.
Advances to Micro Enterprises (Priority) stood at '53791 crore achieving 9.25% to ANBC as against the mandatory Target of 7.5%.
The Bank actively participated in various Government Sponsored Schemes, such as, Prime Minister's Employment Generation Programme (PMEGP), National Rural Livelihood Mission (NRLM), National Urban Livelihood Mission (NULM), Differential Rate of Interest (DRI) Scheme, Stand Up India, Pradhan Mantri Mudra Yojana (PMMY).
As at March 2021, the outstanding advances under the following Government Schemes, aggregated to '28998 crore, involving around 20.85 lakh beneficiaries. Performance under various Government Sponsored Schemes:
(' in Crore) |
||
Scheme |
Mar-21 |
|
Accounts |
Amount |
|
Prime Minister's Employment Generation Programme (PMEGP) |
37324 |
1672 |
Deendayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM) |
135495 |
3432 |
Deendayal Antyodaya Yojana-National Urban Livelihoods Mission (DAY-NULM) |
17517 |
197 |
Differential Rate of Interest |
111783 |
96 |
Stand Up India |
6336 |
1176 |
Pradhan Mantri Mudra Yojana (PMMY) |
1776195 |
22425 |
Total |
2084650 |
28998 |
Advances to DRI stood at '96 crore, consisting of 1.12 lakh beneficiaries, of which, advances by rural and semi-urban branches amounted to '75 crore. In support of the underprivileged sections of the society, the Bank's advances to SCs / STs beneficiaries amounted to '14175 crore as at March 2021, covering 8.28 lakh borrowers. The advances to SCs / STs comprised 4.65% of total priority sector advances. Advances to weaker sections reached '150737 crore, constituting 17.66% to ANBC against mandated norm of 10%.
Various components of advances to Weaker Sections as at March 2021:
(' in Crore) |
||
Sector |
Outstanding |
|
Accounts |
Amount |
|
Small & Marginal Farmers, Landless Labourers, Tenant Farmers and Share Croppers |
8368878 |
113328 |
Artisans, Village and Cottage Industries |
421150 |
11540 |
SC / ST Beneficiaries |
828404 |
14175 |
DRI Loan |
111783 |
96 |
Self Help Group |
343290 |
10156 |
Joint Liability Group |
68064 |
1442 |
As at March 2021, advances to specified minority communities aggregated to '51773 crore, accounting for 17.04% of the actual priority sector advances against the stipulated 15% norm.
MICRO SMALL & MEDIUM ENTERPRISES (MSMEs)
Advances to MSMEs increased to '108334 crore as at March 2021, Credit to M&SE segments rose to '94822 crore. In order to increase credit flow to this segment and in view of the ongoing Covid-19 pandemic in FY 2020-21, the Bank has launched various need based schemes and products catering to the needs of the specific segments such as:
V GECL Schemes (GECL 1.0 & GECL 2.0) - To existing Business Enterprises / MSMEs / PMMY Customers to build up current assets and to meet operational liabilities and restart the business as per communication received from M/s NCGTC Ltd from time to time.
S CGSSD - CGSSD (Credit Guarantee Scheme for Subordinate Debt) has been launched on 31.07.2020 to provide guarantee coverage for the Credit Guarantee Scheme for Subordinate Debt to provide Sub-Debt support in respect of restructuring of MSMEs. The scheme is valid till 30.09.2021.
S PM SVANidhi- This scheme has been introduced during July 2020 for all street vendors engaged in vending in urban areas as on or before 24.03.2020 as per identification criteria stipulated in scheme guidelines of MoHUA. Small Industries Development Bank of India (SIDBI) is the implementation partner of the MoHUA.
S Based on RBI Notification RBI/2020-21/17 DOR. No.BP.BC.4/21.04.048/2020-21 dated 06-08-2020, Wing has extended an OTR Scheme to MSME loans under standard asset category as at 01.03.2020 with exposure up to '25 crore, to be implemented by
31.03.2021.
S PRSF (Partial Risk Sharing Facility) - This scheme has been approved for implementation vide orders of the Board dated 01.12.2020 to finance the eligible MSEs towards execution of energy efficient projects, in line with the PRSF scheme of SIDBI.
Under Pradhan Mantri Mudra Yojana (PMMY), the Bank sanctioned an amount of '13210.29 crore against the target of '12800 crore during FY 2020-21. Sanctions and disbursals under different categories of Mudra Yojana are as under:
Category |
As on 31.03.2021 (' in Crore) |
|||
No. of Accounts |
Sanction Amount |
Disbur sement Amount |
Out standing Amount |
|
Shishu (<50,000) |
722608 |
1486.91 |
1479.12 |
1034.53 |
Kishore (Above 50,000 -5 Lakhs) |
272283 |
6041.41 |
5994.12 |
4901.41 |
Tarun (Above 5 Lakhs to 10 Lakhs) |
68645 |
5681.97 |
5644.15 |
4515.38 |
Total |
1063536 |
13210.29 |
13117.39 |
10451.32 |
> Â Â Â Under stand up India, the Bank Sanctioned 4196Â accounts to the tune of '929 crore.
> During FY 2020-21, under PMEGP the Bank sanctioned 7985 proposals amounting to '750 crore, with total margin money claimed stood at '281 crore.
>    With respect to PSB Loans in 59 minutes, the Bank is one of the top performers on this portal with 31014 in-principal sanctions since the inception till
31.03.2021.
> Â Â Â Under PM Svanidhi, the Bank sanctioned 159682Â accounts amounting to '159.68 crore.
> Under RBI Onetime Restructuring Scheme-III (Accounts restructured under RBI Circular dated 06.08.2020) 45540 accounts have been restructured amounting to '1799 crore till 31.03.2021.
> Â Â Â GECL SCHEME
1)    Under ECLGS 1.0, 475420 sanctions amounting to '9973 crore were made & 451332 accounts amounting to '9577 crore disbursed till
31.03.2021.
2)    Under ECLGS 2.0, 98 sanctions were made amounting to '921 crore & 98 accounts were disbursed amounting to '806 crore till
31.03.2021.
>    CCS-19 (Canara Credit Support to Covid-19 Affected Customers) Scheme - Bank has made 78372 disbursements of '2011 crore till 31.03.2021.
>    Under TReDS Platform, our Bank has discounted 2966 Bills amounting to '653.16 crore during FY 2020-21.
DIGITAL BANKING &ALTERNATE DELIVERY CHANNELS
The Bank has 13452 number of ATMs as on March
2021. The Bank's EMV debit card base is at 4.08 crore.
The e-transaction ratio stood at 88.73% as at March 2021.
The number of registered users under Mobile Banking
is at 81.25 lakhs and Net Banking registered users is at
1.61 crore as at March 2021.
During COVID19 we ensured more than 91% uptime of ATMs. We made publicity at Social media platforms and through our ATM screens, sensitizing customers to bank from home and go digital. Posters highlighting Mobile Banking features were displayed at ATM lobbies. SMS was sent to active customers, promoting to use ATMs/ Mobile Banking / Internet Banking and other available Digital modes.
>    Safety measures mandated by RBI (i.e. Terminal Security Solution, Anti-skimming Devices, EMV compliance) have been successfully implemented in all our operational ATM's within the timelines.
> Â Â Â All ATMs are migrated for centralised reconciliation.
>    Implemented Card less Cash Withdrawal and OTP for cash withdrawal above '10,000/-.
As per RBI guideline, Enhancing Security of Card transactions for Debit Card & Credit Card, enabling and disabling card for online and international transactions is enabled in all channels like Internet Banking, Mobile Banking, ATM and branch channel.
>    Payment through default IFS Code (Default IFSC will come while making payment through MB).
>    Self-account payment inside Mobile Banking through other account.
>    Flight / Bus tickets booking, Donations and other lifestyle payments.
> Â Â Â Opening of DEMAT A/c & Trading account.
> Â Â Â Digilocker facility.
> Â Â Â Forex transactions for retail customers.
>    Canara Un-secured Personal Loan - Bank has introduced end to end digital lending platform for extending online unsecured personal loan facility for existing customers. Customers can avail loans upto '1 Lakh using this online facility. The platform facilitates the Digital Stamping, execution and signing of document.
>    Canara Shishu Mudra Loan - Bank has implemented Online Shishu Mudra loan facility as part of its Digital lending initiative. Customers can avail loans upto '50,000 using this online platform.
customers had been provided with a facility to open / close fixed deposits online. As an additional functionality, we have recently enabled online partial redemption facility for the deposit accounts opened.
PPF services such as Account Opening, Subscription etc. were introduced under Internet Banking and Mobile Banking for the benefit of our customers.
Facilities such as Account Opening, Subscription etc. related to SSA have been integrated in our Internet and Mobile Banking channels.
>    Introduction of Senior Citizen savings scheme services of GOI online through OMNI Channel platform - to cater specifically to the needs of Senior Citizen.
>    Online application for Kisan Vikas Patra(KVP) account enabled in Omni Channel.
>    Online Facility to apply for Gold loan at branches was introduced. This facilitates customers to initiate a gold loan application process with all details such as ornament details / land details etc. and letting them know the eligible amount. Customers could then walk into the branch to pledge the gold for the branch officials to complete the loan processing.
>    Online application facility for KCC Loan and KCC renewal - has also been facilitated similar to gold loan application process.
functionality was introduced to facilitate customers to apply for credit card via online channels.
>    Foreign outward remittance services - Via integration of CPCFT in corporate Internet Banking, forex services have been enabled for our Corporate Internet Banking customers.
>    Introduction of Lead Management System and integration with Internet & Mobile Banking Channels. The integration has facilitated customers as well as non-customers to register their interests in any of the products of the Bank. The LMS system of the Bank is integrated with the Bank's marketing wing/ call centre as well as branch network. Customers can schedule a call back for details of the product as well as assistance.
>    CPPS (Central Positive Pay System) was enabled in our Internet & Mobile Banking channels. The facility enables customers to submit required details of their cheques issued via online channels without visiting the Branch.
> Integration of Doorstep Banking services with Internet & Mobile Banking channels.
>    Online application and policy issuance facility were introduced for Personal accident cover, Online application for Home Insurance, Online application for Health insurance and Online application for Travel insurance.
>    Digilocker facility has been integrated in the Bank's Internet & Mobile Banking Channels.
> Â Â Â NACH mandate cancellation facility via Internet &Â Mobile Banking channels has been enabled.
>    De-mat & Online Trading Account Opening has been enabled through Omni Channel Net Banking.
>    Opening of e-Insurance account with NSDL has been enabled through OMNI Channel.
>    As part of Bank's endeavor to secure the card transactions for its customers, following Card Management services has been enabled through Mobile as well as OMNI Channel solution.
S Credit / Debit / Pre-paid Card management through Net Banking and Mobile Banking platform
S Limit Management for Debit / Credit / Pre-paid Cards for POS / ATM / E-commerce transactions
S Switching on / off the usage of Credit / Debit / Pre-paid Card
S Switching on / off NFC features for Credit / Debit Card
S Temporary or permanent blocking of card
S Switching On / Off the International usage of the card
S Generation of Card PIN through Mobile and Net Banking
S Digital Calendar - Bank has integrated Digital Calendar for its customers through Website, Mobile Banking and Internet Banking Platforms. This calendar provides List of Holidays for specific state / territory.
S Now the Customers can get notification about various information through Mobile Banking Application.
S Promotional messages can be delivered through In-App Notification features.
S Debit / Credit Messages can also be delivered through this facility.
>    BMTC UPI OR Scan Pay - This facility has been made available for BMTC buses running in Bangalore City. Using this facility customers can pay for Bus fares through UPI based system.
>Â Â Â Â AP-GSWSÂ (Gram Sachivalaya Ward Sachivalaya) 30Â Govt bill payment
S This service is specifically implemented for Andhra Pradesh State Government using UPIÂ based dynamic OR facility.
S Using these services 30 Government Department Bills can be paid by the customers.
>    Cardless cash withdrawal through ATM facilitating Customers to withdraw Cash without using any card in all ATMs of Canara Bank. When customer makes a request in Mobile Banking platform for cardless withdrawal, using the secured authentication mechanism, the cash can be withdrawn at Canara Bank ATMs without using any Card.
>    Canara Bank has implemented Canara DiYA functionality for online account opening process using Aadhaar based authentication. The account opened through Diya is non-CDD (Customer Due Diligence) To make the account of customers fully complied with KYC norms, Bank has launched Video KYC facility.
>    Online Debit Card Request facilitating Customers to place the request for Personalized debit card request through online portal.
>    Marketing officers can visit Customers' Home / office address to open instant accounts through TAB Banking.
Facilitating customers to update their PAN / Communication Address via Internet and Mobile Banking. Prior to successful updation, the system verifies and matches the details provided by customer with the issuing authority.
>    The new services have been added in Bank's Tab based Financial Inclusion Solution like Cheque Status Enquiry, Stop Payment of cheque, PPF module, Sukanya Samridhi Yojana, Pass Book Updation, E-KYC Account opening, IMPS transactions and Loan Remittance functionality.
Our Bank has embarked upon the Document Management System (DMS) project to digitalize the various Banking operations. DMS includes digitalization of documents including work-low automation, centralized storage, Content Management system and secure accessing of documents, solution to physical storage management etc.
DMS, with work-flow automation, provides solution to various facets related to creation, storage, indexing and retrieving of digital files. Key benefits of DMS are Centralization and Management of Documents, Increased Operational Efficiency, Reduced physical Storage Space, Enhanced Security, Go green initiative and reduced paper usage.
As a part of financial inclusion drive, the Bank makes its products and services available to financially excluded and marginalized sections of the society. As per the Government of India and the Reserve Bank of India directions, the Bank has been proactive in financial inclusion efforts, with key interventions, viz., expanding banking infrastructure, offering appropriate financial products, making extensive & intensive use of technology and advocacy of financial literacy.
S The Bank has 1123 Financial Inclusion (FI) Branches under branch model and also engaged 9129 Business Correspondent Agents (BCAs) under Business Correspondents (BC) model.
S Bank formed 'Canara Financial Advisory Trust' to take care of the affairs of the Financial Literacy Centres (FLCs) of the Bank as well as the FLCs promoted by the Regional Rural Banks (RRBs) sponsored by the Bank. The Bank has 152 FLCs in districts & blocks level across the country, managed by the Counsellors (retired bankers).
S Bank opened 138.47 lakh accounts under PMJDY.
S Covered all allotted 10049 villages comprising of 3962 allotted SSAs and 3371 Urban wards by opening of 1123 brick & mortar branches and engaging 5267 Business Correspondent Agents (Bank Mitras) at remaining locations.
S Under social security schemes launched by the Government of India during the year, following enrolments have been made under PMJJBY & PMSBY.
(In Lakhs)
Scheme Enrolments including Renewal |
As at March 2021 |
Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) |
53.00 |
Pradhan Mantri Suraksha Bima Yojana (PMSBY) |
144.17 |
Atal Pension Yojana (APY) |
24.63 |
S Under Sukanya Samriddhi Yojana, the outstanding number of accounts as on 31st March 2021 is 104296 accounts.
The Bank is a Registrar and Enrolment Agency for Aadhaar Enrolment. As per UIDAI guidelines, the Bank have to establish ASKs at 10% of the Bank branch premises. Accordingly, Bank has established 1494 ASKs, comprising of 1201 centres for the Bank and 293 centres for the 4 sponsored RRBs (KAGB 116, KGB 62, KVGB 62 & APGB 53).
Women Empowerment Section at Head office and Centre for Entrepreneurship Development for Women (CEDW) at 24 Circle Offices and 176 Regional offices across the country are working relentlessly towards economic empowerment of women. These CEDWs have reached potential    entrepreneurs, undertaken counselling,
supported their training needs, provided finance and arranged marketing facilities. A total of 486 Programmes were organized by the CEDWs during FY 2020-21.
As on 31.03.2021, Our Bank has been assigned with:
⢠   State Level Banker's Committee (SLBC) Convenorship in two states i.e. Karnataka and Kerala and Union Territory Level Banker's Committee (UTLBC) Convenorship in Lakshadweep.
⢠   Lead    Bank responsibility in 60 districts
across 8 states and 2 Union Territories viz. Andhra Pradesh (5), Bihar (1), Delhi (3), Haryana (3), Lakshadweep (1), Karnataka (15), Kerala (7), Tamil Nadu (7), Telangana (4) & Uttar Pradesh (14) comes under 14 Circles of the Bank.
INTERNATIONAL OPERATIONS AND BUSINESS
The Bank has 4 overseas branches, viz., London (U.K), Hong Kong, New York (U.S.A) and Dubai International Financial Centre (DIFC), Dubai (UAE). Besides the above 4 overseas branches, the Bank has a Representative Office at Sharjah (UAE), Canara Bank (Tanzania) Ltd., a Wholly Owned Subsidiary at Dar-es Salaam in Tanzania and Commercial Indo Bank LLC, a Joint Venture with State Bank of India in Moscow, Russia.
Total business of the overseas branches aggregated to '70,166 crore comprising of Deposits of '47,569 crore and Advances of '22,597 crore as at the end of the financial year 2021. Overseas Business constituted 4.16% of the Bank's global business. As per the rationalisation plan for overseas branches, Bank has closed Johannesburg Branch in South Africa during the Financial Year. During the Financial Year, Bank has decided to divest its stake in CIBL to SBI, the majority stake holder and close its operations in Hong Kong.
Gross NPA of the Bank is at 8.93% ('60288 crore) and Net NPA is at 3.82% ('24442 crore) as at March 2021. The cumulative Cash Recovery including Recovery in written off accounts during FY 2020-21 was at '10918 crore. Upgradation for FY 2020-21 was at '2407 crore. Provision Coverage Ratio (PCR) is at 79.68% as at March 2021. Slippage has been contained during the year to '17885 crore.
During FY 2020-21, 1596 properties were sold amounting '1021.63 crore and 2927 accounts were settled / closed / upgraded amounting '826.76 crore on account of initiating actions under the SARFAESI Act. The Bank conducted 1152 Recovery Meets during FY 2020-21 that has resulted in recovery of '4501 crore. In FY 2020-21, 212023 cases were settled, covering an OTS amount of '7730 crore. In FY 2020-21, 11030 cases were referred to Lok Adalat, out of which, 2264 cases were settled, covering an amount of '31.13 crore. Besides, the Bank took several initiatives to contain slippages and speed up recovery from overdue loan accounts. These include, conduct of Can Adalats at branch level, cluster adalats at Regional level and mega adalats at Circle level for one time settlements (OTS), Lok Adalats at district level, regular follow-up of overdue in loan accounts through Call Centre, conduct of e-auctions for sale of seized assets and initiation of stringent recovery measures against Wilful Defaulters. As on March 2021, there were 971 wilful defaulters with an outstanding amount of '11272 crore.
The Bank has initiated resolution process in respect of 390 Cases by referring to NCLT / filing our claim as at 31.03.2021 and is expecting substantial recovery through resolution during FY 2021-22. In FY 2020-21, recoveries amounting to '2360.94 crore were done in NCLT referred accounts. The Bank has also formulated various special OTS Schemes for settlement of small value NPAs in agriculture NPA, Education loans, tractor loans and other farm mechanisation, etc.
As on March 2021, the outstanding stressed assets portfolio (including restructured standard accounts) of the Bank stood at '66887 crore, accounting for 9.91% of gross advances.
An independent Risk Management Wing at the Head Office is functioning as a nodal centre for overall implementation of various risk management initiatives across the Bank. Risk Management Sections are functioning at all 24 Circle Offices of the Bank as an extended arms of the Risk Management Wing. The Bank has in place risk management policies across geographies and across all risks encompassing the entire gamut of risk profile. These include policies on Credit Risk Management, Operational Risk Management, Market Risk Management, Asset Liability Management and Group Risk Management. The Bank has in place an Internal Capital Adequacy Assessment Process (ICAAP) under Pillar 2 of Basel III norms complying with SREP guidelines. The ICAAP exercise covers the domestic and overseas operations of the Bank, Subsidiaries, Joint Ventures, Sponsored Entities and Associates. Stress testing exercise is also performed by the Bank to ascertain the potential risks faced by the Bank. The ICAAP document is reviewed and approved by the Risk Management Committee of the Board and the Board of Directors. The Bank has a Board Level Sub-Committee for Capital Planning Process. The Committee articulates macroeconomic scenarios vis-a-vis capital requirements of the Bank, in tune with business strategies. The Committee ensures maintenance of appropriate level of Capital to Risk Weighted Assets Ratio (CRAR) and evaluates various options for raising the capital.
In an endeavour to move towards Advanced Approaches under Basel III for computation of capital for Credit, Market and Operational Risks, the Bank had engaged
the services of a Consultant for implementation of Enterprise-wide Integrated Risk Management solution for itself and the Group Entities, so as to build requisite risk management framework. As a pre-requisite for the implementation of Enterprise wide Integrated Risk Management architecture, the Bank has procured a Risk Solution that would enable it to meet requirements of Advanced Measurement Approaches. The Bank has submitted Letters of Intent to RBI for adoption of Internal Rating Based (IRB) Approach for calculation of capital charge for Credit Risk, Internal Models Approach for calculation of capital charge for Market Risk and Advanced Measurement Approach for calculation of capital charge for Operational Risk.
The final guidelines on Basel III Capital Regulations became effective from 1st April, 2013. As per RBI guidelines, the transitional period for full implementation of Basel III Capital regulations are extended up to 01.10.2021. The banks in India need to maintain a minimum Common Equity Tier 1 (CET1) capital of 5.50%, Tier 1 capital of 7.00%, total capital of 9.00% and Capital Conservation Buffer (CCB) of 2.50% from 01.10.2021 onwards. The banks also have to maintain a minimum Tier 1 Leverage Ratio of 3.50% as a credible supplementary measure to the risk based capital requirements. The Bank endeavors to remain adequately capitalized. The Bank has adequate headroom to raise capital from the market, including recapitalization support from the Government of India. Going forward, the Bank's capital requirement shall be met by injecting fresh equity capital, retention of profits, optimization of business levels, proactive capital planning and management.
The Credit Risk management process outlines the principles, standards and approach for credit risk management at the Bank. Systems, procedures, controls and measures are in place to actively manage the credit risks, optimize resources and protect the Bank against adverse credit situations. In order to comprehensively address the issues and concerns of the Credit Risk, the Bank has put in place a comprehensive Credit Risk Management Policy. A robust system for Internal rating (on internally developed models) of the borrowers, appraisal of loan / credit proposals, including seeking adequate information for appraising the viability of the proposal and creditworthiness of the applicant for
sanctioning credit limits, well defined credit approval process and authorization matrix, standards for collateral management, credit monitoring, restructuring of advances, MSME and Off Balance Sheet Exposures, is followed. Risk Acceptance, Risk Measurement, Prudential Exposure Norms, Organizational Structure, Strategies and Operational Process are in place. In order to address the credit risk at portfolio level and the issue of concentration risk, the Policy prescribes fixation of various exposure ceilings. Risk Based Pricing is in tune with the Risk profile of the borrower to generate returns to achieve targeted RoA and NIM.
The Bank has a Loan Review Mechanism for constantly evaluating the overall performance of the borrowal accounts and for bringing about qualitative improvements in credit administration, monitoring and credit audit. The entire process of the Loan review and monitoring is duly administered by the Credit Administration & Monitoring Wing.
The Market Risk framework of the Bank aims at restricting loss from all types of market risk loss events and also to establish limit structure and triggers for various market risk factors. Exposure limits, such as, Stop Loss Limits on Trading Book, Intraday and Overnight Limit for various Currency Positions, Dealer-wise Limits, Aggregate Gap Limit, Limits on Money Market Operations, Modified Duration Limits for investment portfolio and VaR Limits are fixed to act as risk mitigants / triggers. Mid Office of Risk Management Wing monitors these limits, along with other triggers, on a daily basis. A reporting framework has been put in place for effective and timely monitoring of market risk limits and triggers.
Operational Risk Management framework in the Bank is based on ethics, organization culture and strong operating procedures, involving corporate values, internal control culture, effective internal reporting and contingency planning. The Bank has adopted polices for management of Operational Risk, which covers various aspects, such as, Operational Risk Management Structure, Outsourcing Activities and Business Continuity Plan. At present, the Bank is in the process of migration
Basic Indicator Approach (BIA). The Bank has already put in place Incident Management module for timely reporting of incidents, Review of Key Risk Indicators (KRI), Conducting of Risk Control & Self Assessment (RCSA) workshops and Scenario Analysis workshops to compute capital charge for Operational Risk.
Within the policy framework, the Board of the Bank has set up Asset Liability Management Committee (ALCO), which is entrusted, inter alia, with the role of management of assets and liabilities including the funding strategies and its composition, product pricing, stress test and contingency action plan among others.
The Bank has implemented the RBI guidelines with respect to Liquidity Coverage Ratio (LCR) with effect from 01.01.2015. LCR of the Bank is being maintained above the stipulated regulatory requirement on an ongoing basis.
The Bank has various Subsidiaries, Joint Ventures and Sponsored Entities, which are engaged in diversified activities. As the Bank has considerable stake in these Group Entities, Bank has put in place a Group Risk Management Policy to identify and manage risk in intra Group transactions and exposures to raise the standard of Corporate Governance by reducing and avoiding conflicts of interest between the Group Entities and also to ensure 'Arms Length Principle' among Entities, with regard to business parameters. The Group Chief Risk Officer (GCRO) of the Bank is supervising the risk management activities of the Group Entities.
COMPLIANCE TO INTERNATIONAL STANDARDS
Bank has been certified with ISO: 27001:2013 for Data Centre, Disaster Recovery centre and Department of Information Technology Wing and the certification is valid from 11/04/2020 for a period of 3 years. It is certified that the Information Security management system of the organization has been assessed and found to be in accordance with the requirements of the ISO 27001:2013 standard.
Aggregate investments (net) of the Bank stood at '258698 crore as at March 2021. While modified duration of the investments portfolio stood at 4.89 as at March 2021, the modified duration of the Available for Sale (AFS) portfolio is at 1.30 as at March 2021. The yield on investments stood at 6.74% as at 31st March 2021. The trading profit under domestic treasury operations during the year increased to '3316 crore on account of active churning of the investment portfolio along with active participation in OMOs. The Bank continues to be an active player in the Government Securities Market as a Primary Dealer (PD).
The total amount of bids submitted for underwriting was '209767 crore, of which, the underwriting commitment accepted by the RBI was '108166 crore. With regard to Treasury Bills under PD business, as against the minimum success ratio of 40% to be achieved in each half year, the Bank has a success ratio of 83.10% for the first half year ended September 2020 and 86.45% for the second half year ended March 2021.
Foreign Business Turnover of the Bank aggregated to '164437 crore, comprising of '72601 crore under exports, '34089 crore under imports and '57747 crore under remittances during the year ended March 2021.
During the year the Bank's Merchant Banking Division handled 1128 issues (public / rights / debt) as cumulative under Bankers to an Issue. During the year FY 2020-21, Section has handled 88 Equity Issues and 18 Debt Issues and Bank got float fund benefit of '3702.34 crore for 4-7 days through ASBA with number of applications 507330. The amount collected as commission ('10/- per application plus 0.35% on allotted amount) is '37.84 Lakhs during the year 2020-21.
> Under Capital Gain Bonds, Bank is getting 0.12% Commission + applicable GST on the amount so mobilized and floating fund for one day.
Rural Electrification Corporation Ltd (REC), National Highways Authority of India (NHAI), Indian Railway
Finance Corporation Ltd (IRFC) and Power Finance Corporation (PFC) have entrusted the Bank to continue to act as " Arrangers and Collecting Bankers" for the Private Placement Capital Gain Bond Issues
During 2020-21, funds mobilized / Collected by our Bank are '559.59 crore as collecting banker and '50.00 crore as arranger. We have received an Arranger fee of '11.40 Lakhs. Section is providing share valuations as per request of the companies. During the year FY 2020-21, Section has prepared 2 valuation reports and earned commission '5.00 Lakhs. We also initiated the work of arranger for AT1 Bonds. In this process, our Bank has invested '250.00 crore in Bank of India AT1 Bonds and we are entitled to get '1.00 crore on account of Arranger fee.
The Bank has tied-up arrangements with life and non-life insurance segments under its 'Bancassurance' arm. During the year FY 2020-21, Bank earned a commission income of '187.91 crore from its joint venture, M/s Canara HSBC OBC Life Insurance Company Ltd. Under the Mutual Fund business, the Bank earned a commission of '30.43 crore from its joint venture, M/s Canara Robeco Asset Management Company Ltd. A commission income of '63.82 crore was earned under Non-Life (General Insurance & Health Insurance) business from its tie-up arrangements with all the three GI Partners M/s Bajaj Allianz General Insurance Co Ltd, M/s TATA AIG General Insurance Co. Ltd and M/s The New India Assurance Co. Ltd & Standalone Health insurance partner M/s HDFC Ergo General Insurance Co. Ltd (Erstwhile AMHI) for marketing their Health insurance products. In Social Security Schemes (SSS), Bank has earned commission of '18.20 crore under PMJJBY & '3.06 crore under PMSBY. Bank has also earned renewal / trail commission from E-Syndicate Insurance and Mutual Fund partner of '0.98 crore.
The Bank undertakes Government Business, comprising Direct and Indirect Tax collections, payment of Central Government and State Government Pensions, Handling of Postal Transactions and State Government Treasury Transactions, Public Provident Fund Scheme and Senior Citizens' Saving Scheme, issuing Sovereign Gold Bonds and Sukanya Samridhi Scheme. These products
contributed to improvement of CASA and earned a fee income of '167.20 crore during FY 2020-21.
The Bank has been authorized as the accredited banker for Ministry of Human Resources Development (MHRD), Ministry of Culture, Ministry of Youth Affairs & Sports, Archaeological Survey of India, Ministry of Shipping, Ministry of Road Transport and Highways, Lakshadweep Administration and Unique Identification Authority of India (UIDAI), New Delhi. The Bank was implementing the National Pension System for Unorganised Sectors under Swavalamban Scheme since FY 2012-13. The Government of India has launched Atal Pension Yojana (APY) in place of Swavalamban with a view to providing defined pension to unorganised sector. The Bank could mobilise 590992 accounts under APY during the FY 2020-21.
ORGANISATION AND SUPPORT SERVICES
In a bid to expand the reach, the Bank added 130 domestic branches during the year. As at March 2021, the Bank had 10416 domestic branches, including Specialized Branches.
rnmnncitinn nf Rranrh M^twnrlr
Category |
No. of Branches |
Opened during the year |
|
31.03.2020 |
31.03.2021 |
||
Metropolitan |
1273 |
2113 |
52 |
Urban |
1226 |
2094 |
60 |
Semi-urban |
2004 |
3140 |
18 |
Rural |
1826 |
3069 |
0 |
Overseas |
5 |
4 |
0 |
Total domestic Branches |
6329 |
10416 |
130 |
Note: 105 domestic branches were merged / closed during the year.
1 Overseas branch was merged / closed during the year.
The total Specialized Branches of the Bank stood at 414 as at March 2021.
MANPOWER PROFILE
As at March 2021, the Bank had 88213 employees on its roll. The cadre-wise break-up of manpower is as follows:
Cadre |
March 2020* |
March 2021 |
Officer |
32596 |
48912 |
Clerk |
18353 |
26427 |
Sub Staff** |
7683 |
12874 |
Total |
58632 |
88213 |
*Figures relating to standalone / consolidated Canara Bank for pre-amalgamation period;
âincludes Part Time Employees (PTEs)
Total staff strength of the Bank comprised of 55.44% Officers, 29.96% Clerks and 14.6% Sub Staff. The Women staff strength of the Bank was 27,401, constituting 31.06% of the employees. The total number of ex-servicemen staff as at March 2021 stood at 5,372.
There were 2,412 Physically Challenged Employees on the rolls of the Bank.
Reservation Policy in respect of Scheduled Castes and Scheduled Tribes, Other Backward Classes, EWS &Â Persons with Disabilities
The Bank has been strictly adhering to the Reservation Policy in respect of Scheduled Castes, Scheduled Tribes, Other Backward Classes and Persons with Disabilities, EWS as per the Government of India guidelines.
The representation of SCs / STs / OBCs / EWS / DAPs employees as at March 2021 was as under:
Grade |
SCs |
STs |
OBCs |
EWS |
PWDs |
Officer |
8663 |
3923 |
14229 |
63 |
1228 |
Clerk |
4987 |
1681 |
7848 |
35 |
837 |
Sub Staff* |
4780 |
895 |
3597 |
- |
347 |
Total |
18430 |
6499 |
25674 |
98 |
2412 |
*includes Part Time Employees (PTEs)
Reservation Cell is functioning in the Bank to Implement and monitor the Reservations and other provisions related to SC / ST / OBC / PWD / Ex-Servicemen & EWS employees. Further Bank has nominated Executives in the rank of GMs as Chief Liaison Officer
for SC / ST / Ex-Servicemen / PWD and also for EWS, OBC employees respectively, who ensure compliance of various Govt. Guidelines pertaining to Reservations.
During the FY 2020-21 the Bank recruited 1548 persons in various cadres, out of which 241 belonged to Scheduled Castes (SCs) and 108 to Scheduled Tribes (STs), 416 belonged to Other Backward (OBC), 76 to EWS category, 32 Ex-servicemen and 55 PWD in various cadres and 590 were women employees.
HUMAN RESOURCE DEVELOPMENT (HRD) ACTIVITIES
⢠   Bank introduced submission of life certificates by our ex-employee pensioners enabled through JEEVAN PRAMAAN portal.
⢠   Performance Linked Incentive (PLI) for the FY 2020-21 has been disbursed.
⢠   Term Insurance Cover for all employees (20 Months of their Gross Salary subject to a minimum of '20 lakhs to Officer employees, '15 lakhs to Clerical employees and '10 lakhs for Subordinate employees)
⢠   The e-Learning portal of our Bank, named "CanDLE" (Canara Digital Learning Experience) was launched. The objective of the project has been to provide an effective online learning facility for our employees for enhancing their knowledge and skills.
⢠   The Bank has in place a robust training set-up with the Apex Centre of Excellence at Manipal & 26 Learning & Development (LDCs) across the country. In addition to this, around 3200 employees have been trained at external institutes of repute like IIMs, IDRBT-Hyderabad, TISS-Mumbai, NIBM-Pune, SIBSTC-Bangalore, CRISIL-Mumbai, ASCI (Hyderabad), IIBF and CAB (RBI)-Pune.
⢠   Bank has focused on the thrust areas like Credit Management, Risk Management, Forex in addition to the regular Orientation / Induction Programs for direct recruit Probationary Officers, Agriculture Extension Officers and Specialist Officers.
Batches of senior executives are also undergoing the flagship Leadership program coordinated by Bank's
Board Bureau. Bank has also adopted the uniform 52 / 26 week training structure for the newly recruited probationary officers / SWOs.
⢠   Executives, on promotion are sent for 05 days Leadership / Executive Development Programs at institutes like IIMs, ASCI Hyderabad, TISS Mumbai etc.
⢠   A Training Advisory Committee headed by the MD & CEO monitors and streamlines the training functions of the Bank. A shift has been made from offline classroom trainings to webinars. Our training vertical has successfully conducted about 850 programs through webinars, where around 40000 employees have participated. 3178 Employees were trained at external institutes of repute.
Several initiatives were taken to remain customer focused through provision of fast service, offering diversified products & services, responding to customers' queries in shortest possible time and redressal of customer complaints within the timelines stipulated.
⢠   As per the instructions of IBA and RBI, the Bank has adopted Customer Rights Policy as advised by the RBI since July 2015, which spells out the Rights of the Customers and also responsibilities of the Banker.
⢠   To assess the quality of customer service rendered by the branches and to get the feedback online, "Annual Survey of Depositor Satisfaction" was conducted from 04/12/2020 to 31/12/2020 with 15 predefined questionnaire.
⢠   As per the Damodaran Committee recommendations, the Bank has appointed a Chief Customer Service Officer (CCSO), who acts as an Internal Ombudsman of the Bank.
⢠   In order to enhance customer convenience, Bank has popularized 24/7 Self Service Functions on IVRS (Missed Call facility) for various services like Balance Enquiry, Mini Statement (last 5 transactions), Hot Listing of Cards etc.
⢠   The following Toll Free numbers are available for customers to contact within India - 1800 425 0018, 1800 103 0018 / 1800 208 3333 & 1800 3011 3333
⢠   The Non Toll free number for customers calling from abroad (Outside India) is +91 80 22 06 4232.
⢠   Call Centre is catering to customers in 9 regional languages, viz., Kannada, Malayalam, Marathi, Tamil, Oriya, Telugu, Gujarati, Bengali and Panjabi besides Hindi and English for redressal of grievances.
⢠   The Bank has implemented online grievance redressal facility for customers to lodge their grievances under the portal Canara Public Grievance Redressal System (CPGRS). The complaints received at the Branches & Call Centres of the Bank are also integrated with the CPGRS package. Once Customer lodges a complaint he receives a ticket number by which he can track the status of complaint and upon satisfactory redressal customer receives an SMS / email notification that his complaint is resolved / redressed and provision is enabled for the customer to submit his feedback.
⢠   The predefined Turn Around Time (TAT) for resolution of complaint at Branch Level is 6 days and on 7th day the grievances are auto escalated to next higher authority.
⢠   On closure of grievance a SMS with web link is pushed to the customers to submit his / her feedback regarding resolution.
⢠   Our Bank has brought out an SMS based Customer Service Feedback mechanism to measure customer satisfaction levels at branches. This feedback mechanism is used to gauge the customer service levels over the counters and helps in proving insights for rewarding our customer service champions and also taking remedial actions, wherever required.
⢠   Bank has introduced 'Jeevan Praman' online portal for submitting Life certificate for pensioners. Facility for filing Form 15G / 15H through Net Banking is enabled for the convenience of customers.
⢠   6 Central Processing Centers are established at Bhubaneswar, Ernakulam. Manipal, Patna, Ranchi & Vijayawada for CASA (Current Account & Savings Bank Account) account opening purposes.
⢠   Our Bank is also a partner in the PSB Alliance which has floated Door Step Banking (DSB). Door Step Banking is popularized in 100 identified centers pan India for the benefit of all the customers including Senior Citizens & Differently abled persons. The services are provided through outside vendors through Universal Touch points i.e., Mobile App, Website & Call centers.
⢠   There are 11 services provided through Door Step Banking, They are Pick up of Negotiable instruments (cheques / drafts / Pay orders, etc), request Account statement, Pick up of new cheque book requisition slip, Delivery of non-personalized cheque books, draft, pay orders, term deposit receipts / acknowledgement etc, Acceptance of 15G, 15H forms, Acceptance of IT challan / Government Business / GST, TDS / Form 16 Certificate issuance, Delivery of Prepaid instrument/ Gift card, Issuing Standing Instructions, Submission of Digital Life Certificate and Cash Withdrawal,
In terms of the Reserve Bank of India guidelines, the Bank has appointed an Internal Ombudsman (IO) as an independent authority to review complaints that are partly or wholly rejected by the Bank. The IO submits periodical reports on his activities to the Customer Service Committee of the Board analyzing the pattern of complaints, for taking action to address the root cause of complaints. Changes where necessitated on the procedures / guidelines have also been carried out based on the IO's recommendations. During the year, the Bank has conducted Outreach Programmes under the auspices of Reserve Bank of India to create awareness on the Banking Ombudsman scheme at various locations.
Risk based Internal Audits (RBIA) numbering 7390 were conducted along with Information System audit (IS Audit) across branches / service units as per the program for onsite RBIA for the FY 2020-21. Concurrent / continuous audits were conducted in 2210 branches / service units, of which 635 branches / service units were subjected to concurrent / continuous audit by Internal Auditors and 1575 branches / service units were subjected to concurrent audit by External Auditors, covering 70% of Advances and 50% of Deposits of the total business of the Bank. 948 branches were subjected to income / revenue audit on quarterly basis.
⢠   As part of strengthening the audit process, policy has been revised to grade the branches / service units under three scales - LOW / MODERATE & HIGH in RBIA as against the existing four scale rating of LOW, NORMAL, MODERATE and HIGH.
⢠   The Bank has been continuously going for upgradation of audit packages, duly revising the checklists to include latest developments and trends in the Bank. Further, the Concurrent Audit System version upgradation was effected duly revising the checklist in line with the RBI directions. Integration of Concurrent Audit package for conducting Concurrent Audit was introduced with effect from 01.07.2021 and Concurrent Audit of all branches of amalgamated entity is enabled in the Darpan Package. RBIA / other Audit packages were integrated after amalgamation of eSyndicate branches.
⢠   Bank has shown NIL tolerance on frauds and in that process the Inspection / Audit policy of the Bank has been revised and accordingly the branches where fraud has been detected or serious irregularities were observed, the gradation was reassigned as "High Risk" to have more control on such branches / units.
⢠   Off Site Monitoring of the transactions carried out in 10378 branches were reviewed under 26 parameters during 2020-2021 covering Deposits, Loans, GL transactions, Staff Transactions, newly opened accounts, premature closure of Deposits, reactivation of dormant accounts and LCs and Guarantees etc. for ascertaining any suspicious or dubious transactions. During the review of transactions, deviations which attract analysis from AML angle found were referred to the AML Cell of the Bank for further action.
⢠   During the period FY 2020-2021 OTM section also reviewed issues like Business variations during quarter ends, Accounts transferred and re transferred, Accounts opened and closed in short duration.
⢠   Now the transactions are being assigned to Regional Offices instead of branches for verification of the transactions and for submission of replies. Such replies are reviewed at Circle Offices concerned and are being closed.
⢠   Inspection Wing is conducting Investigations independently on complaints emanated from VIPs, CVC, Statutory Bodies and NPA accounts of '10 lakhs & above where irregularities / lapses are observed. During the year 2020-21, Inspection Wing
has completed 145 Investigations and submitted the reports to the concerned authorities for logical conclusion.
The Bank was brought under Risk Based Supervision (RBS) regime by RBI, in lieu of Annual Financial Inspection (AFI) from FY 2014-15. Presently, the Bank has completed the 7th cycle of RBS. RBS framework is named as Supervisory Programme for Assessment of Risk and Capital (SPARC). Under SPARC, a detailed qualitative and quantitative assessment of the Bank's risks is made by RBI on an on-going basis through a combination of offsite analysis of the data and information furnished by the Bank as well as the findings of the on-site Inspection for supervisory Evaluation (ISE).
Know Your Customers (KYC) /AML / CFT
The Bank is committed to implement the KYC / AML / CFT norms in its completeness and has zero tolerance towards non-compliance. To ensure this, the Bank has put robust systems and processes in place. Advisories issued by the regulators with respect to designated individuals / entities are scrupulously followed. Regular training is provided to staff members to increase their awareness on matters regarding KYC / AML / CFT.
Central Processing Hubs (CPHs)
Bank has implemented Centralized opening of CASA accounts through 6 CPHs (Centralized Processing Hubs) located at Ernakulam, Bhubaneswar, Manipal, Patna, Ranchi and Vijayawada with effect from 01/10/2020.
The main objectives of the centralization of CASA accounts system is to implement backend account opening process for the Bank Pan India with all relevant details at one go complying with all regulatory requirements in addition to providing quick and excellent service, implement and follow the best practice code in the industry, eliminate the physical movement of the application forms, minimize the Turn Around Time (TAT) for account opening, minimize the manual intervention in the present procedure, maximize utilization of the resources to increase the productivity and focus on Digital penetration and alternate channels.
IMPLEMENTATION OF OFFICIAL LANGUAGE
The Bank has attained many milestones in Implementation of Official Language Hindi and won prizes at various levels during the year under review. As at March 2021, more than 86% of employees possess working knowledge in Hindi. All these employees who possess working knowledge in Hindi have been trained in functional Hindi through Hindi workshops. During the year under review, Bank has conducted 217 such workshops.
In the sphere of using Information Technology in the Official Language, Hindi version of the Core Banking Solution (CBS) of our Bank has been made live during the year. At the same time the Bank has furthered the use of Unicode package for word processing by training the employees for use of more and more Hindi through Unicode standard and the Bank has made provision in ATM screens of the Bank for carrying transaction in 08 Regional languages. Apart from Hindi and English, transaction slips can be obtained in Malayalam, Tamil, Telugu, Kannada, Bengali, Gujarati, Punjabi and Marathi from our ATMs. Apart from this, an online package has been made live during the year for submission of quarterly report on progressive use of Hindi, i.e. STR-18.
Official Language Implementation Committees have been constituted at all levels i.e., Head Office, Circle Offices, ROs and in all the branches of the Bank for reviewing progress made in use of Hindi. A quarterly meeting of the committee is being conducted promptly. Our Bank is the convener for the Town Official Language Implementation Committee at Agra, Bhagpat, Etah, Faridabad, Ghaziabad, Gurugram, Hatharas, Kasganj, Meerut, Ananthapuram, Coimbatore, Dindigul, Kannur, Karwar, Kamareddy, Ongole, Sangareddy, Udupi, Vijaypura and Thiruvananthapuram and the half yearly meetings are being conducted promptly.
In order to make Hindi as business language, Bank has released a slogan "ftS mirVi oT Ut®, WMT XTut Of x^l®â on 01 September 2020 during Inaugural function of Hindi Month 2020. As an innovative measure to popularize Banking in Hindi, a programme named "Hindi
Mein Paricharcha" (Discussion programme in Hindi) on contemporary Banking subjects was conducted in all four quarters at all Administrative Office level, staff members of all cadres participated actively and the programme was opined as very useful and educative. Hindi house magazine Canara Jyoti is being published regularly.
Apart from Hindi and English, importance is being given to all regional languages in the respective regions.
S In accordance with OL rules, importance is being given to Regional languages along with Hindi in B and C regions, mostly letters received in Regional Language are being replied in that Regional Language.
S In order to motivate staff members regarding rendering customer service in regional language the Bank has released a slogan "Be vocal for local: - Learning Local Language is a skill to win over the hearts of local people" along with various initiatives.
S Forms used by the customers like account opening form, withdrawals slips, pay-in slips, application for NEFT / RTGS etc. are made available in trilingual - i.e. respective regional language, Hindi and English, and can be indented through package.
S As per the Official Language Rules all the name boards, informatory boards are displayed in Regional Language also.
S Banners are displayed and Publicity Materials are made available in Regional Languages.
S Bank Advertisements and Notices in regional newspapers are being published in concerned regional Languages.
S Communications with regard to issue of notices for recovery of loans etc. are being sent in Regional Languages.
Vigilance set up at Head Office level comprises of Chief Vigilance Officer, who is assisted by the Executives and staff of Vigilance Department at HO. The Chief Vigilance Officer is also assisted by Vigilance Officers at Circles/ HO / RRBs / other subsidiaries of the Bank in Vigilance administration. The Vigilance Management in the Bank under the supervision / guidance of CVO administers various functions on preventive, participative, proactive and punitive aspects of vigilance with more emphasis on preventive vigilance measures to eliminate / minimise factors which provide opportunities for frauds, corruption and malpractices in the organization and also to take punitive action as a deterrent measure to check recurrence of such instances.
'Vigilance Awareness Week' was observed in our Bank from 27th October, 2020 to 2nd November, 2020, with the theme "Satark Bharat, Samridhi Bharat (Vigilant India-Prosperous India) "and all the Branches / Offices have actively participated in conducting various activities such as administering Integrity Pledge, Seminars, Workshops, Customer Grievance Redressal Meetings, Awareness Sabhas in Gram Panchayats, Panel Discussions, Competitions in Schools / Colleges (viz. Essay Writing, Debate & Quiz Competitions) etc to bring awareness in Society about the ill effects of Corruption. Online training sessions were conducted for employees of the Bank regarding disciplinary matters, procurements and corporate governance.
Important case studies with the modus-operandi of the fraud, in cases where frauds are observed, is uploaded in CANNET for the benefit of employees to enable them to be more vigilant in day-to-day functions.
Systemic improvements are periodically suggested based on the lapses observed while determining vigilance angle in respect of lACs.
To bridge the knowledge gap at the operational level a "Compendium on Preventive Vigilance" was brought out during the occasion and is available in CANNET for the benefit of all Canarites.
IMPLEMENTATION OF INDIAN ACCOUNTING STANDARDS
As per RBI guidelines, the Bank is in the process of implementing the Indian Accounting Standards (Ind AS). A Project Steering Committee headed by Executive Director has been formed to take the required steps on a continuous basis for smooth convergence. RBI, vide its communication ref: DBR.BP.BC. No.29/21.07.001/2018-19 dated 22nd March,2019 has deferred implementation of Ind AS for all Scheduled Commercial Banks till further notice. Bank is submitting Pro-Forma Financial Statements to RBI for every quarter as per the guidelines of RBI.
Canara Bank, with an objective of offering 'One Stop Banking' facilities for the customers, forayed into diversified business activities by opening subsidiaries during late 1980s. Today, the Bank functions as a 'Financial Supermarket', with eight Domestic Subsidiaries, one Associate Company and one Joint Venture in diversified fields. All the Domestic Subsidiaries / Associate / Joint Venture of the Bank recorded satisfactory performance during the year 2020-21.
M/s Canfin Homes Limited, a sponsored entity of Canara Bank is one of the premier housing finance entities in the country. The bank holds 29.99% stake with the company. The loans outstanding of the Company as at March 2021 were '22105 crore. The Company earned a Net Profit of '456.06 crore for current financial year. Gross NPAs of the Company was '201.91 crore (0.91%) and Net NPA was '134.33 crore (0.61%) as on 31.03.2021. The Company proposed 100% dividend for the year 2020-21.
M/s Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd (CHOICE) is a Life Insurance Joint Venture floated by the Bank in association with HSBC Insurance (Asia Pacific) Holding Limited and Oriental Bank of Commerce in the year 2007. The JV commenced its business operations with effect from 16.06.2008, with majority shareholding of 51% by Canara Bank, followed by HSBC (26%) and Punjab National Bank (e-OBC) (23%).
The Company recorded gross premium of '5026.4 crore during the year. The Company achieved Net Profit of '94.60 crore for for FY 2020-21.
M/s Canara Robeco Asset Management Company Limited is a joint venture (JV) with M/s Robeco Group NV with the Bank's holding of 51% Stake. This JV was formed in 2007 divesting 49% Stake held by the Bank in M/s Can Bank Mutual Fund in favour of M/s Robeco Group NV. The Company is currently managing 24 Mutual Fund Schemes with a mix of equity, balanced and debt schemes. The core AuM of the company has reached to the level of '27415 crore as on 31.03.2021 The Company has declared a net profit of '36.29 crore and has also declared a dividend of 200% for the current financial year.
M/s Canara Bank Securities Limited is a wholly owned subsidiary of the Bank. CBSL has taken over the Depository participant services from Canara Bank w.e.f. 01.04.2017. M/s Canara Bank Securities Ltd is extending Online Trading Facility to DP clients. The Company offers stock broking services to both institutional and retail clients. Company has launched opening of Instant Demat Cum Trading Accounts for Canara Bank Customers directly through online mode (digital KYC) "CAN-INSTIGO-DIY". The Company has registered a Net Profit of '14.92 crore and has declared a dividend of 35.00% for the year 2020-21.
M/s Canbank Factors Limited is a factoring Subsidiary of the Bank with 70% stake held by the Bank. During 2020-21, the Company had a total business turnover of '1469.98 crore and has made a Net Profit of '2.55 crore for the current year.
M/s Canbank Venture Capital Fund Limited is a wholly Owned Subsidiary of the Bank and the Trustee and Manager of Canbank Venture Capital Fund Trust. The company has managed 5 funds so far with total Asset under Management of '552.78 crore. CVCFL has been appointed by the Ministry of Electronics and Information Technology (MeitY) to manage the Electronic Development Fund (EDF) with a corpus of '2206 crore.
Another new fund named as "Empower India Fund" is setup with a target corpus of '500 crore with green shoe option of '150 crore. The initial closing is done and available for investment. The Company recorded a Net Profit of '3.10 crore during the year 2020-2021 and has declared dividend of 500%.
M/s Canbank Computer Services Limited is the only Software Company promoted by a Public Sector Bank in the country, with a 69.14% shareholding by the Bank. CCSL is mainly engaged in IT and Software development services, BPO services, ATM / Any Time Payment services, Training, Consultancy and R&T agent. The Company has posted a Net Profit of '3.40 crore for FY 2020-21.
M/s Canbank Financial Services Limited is confining its activities to legal matter arising out of past transactions in securities and recovery of dues under decreed accounts. Company has posted a Net Profit of '1.27 crore for the year 2020-21 by way of receipt of dividends.
M/s SyndBank Services Limited iswholly ownedSubsidiary of e-Syndicate Bank was incorporated under Companies Act 1956 on 25.01.2006. At present, the company is not undertaking any activity and is only pursuing arbitration process against vendor M/s. CMS Info Systems Ltd. for the misappropriation case amounting to '2.05 crore in the High Court of Karnataka as per the directions of the Company's Board. Company has posted a Net Profit of '1.19 crore for FY 2020-21 and has declared dividend of '1 crore during the FY for the first time.
Higher Education Financing Agency (HEFA), is a not-for profit organization, set up by the Bank under a joint venture share holder agreement with the Ministry of Human Resource Development (MHRD), Government of India.
HEFA has been set up for developing the educational infrastructure, including R&D infrastructure thereby enabling the institutions to reach top rankings globally. MHRD extended the scope of existing mandate of HEFA equity base and range of institutions to be financed. As on 31.03.2021, MHRD has infused Capital of '4812.50 crore and Canara Bank has contributed '481.25 crore respectively. The total loans sanctioned as on 31.03.2021 is '31413.8 crore and disbursed is '11308.06 crore. HEFA has disbursed '3678 crore of loans to different institutions during FY 2020-21 and Bank has received '36.78 crore of Management Fee.
As at March 2021, the Bank had four sponsored RRBs, viz., Kerala Gramm Bank (KeGB) in Kerala, Karnataka Gramm Bank (KaGB) and Karnataka Vikas Grameena Bank (KVGB) in Karnataka and Andhra Pragathi Grameena Bank (APGB) in Andhra Pradesh.
Andhra Pragathi Grameena Bank (APGB) operates in 5 districts of Andhra Pradesh with 552 branches and 109 ATMs. Total business of the Bank as at March 2021 is '36640 crore. (Deposits: '18431 crore Advances: '18208 crore).
Kerala Gramin Bank (KeGB) operates in all 14 districts of Kerala with 634 branches & 320 ATMs. The total business of the Bank as at March 2021 is '38607 crore. (Deposits: '20150 crore, Advances: '18457 crore).
Karnataka Gramin Bank (KaGB) operates in 21 districts of Karnataka with 1134 branches & 236 ATMs. The total business of the Bank as at March 2021 is '55865 crore. (Deposits: '31068 crore, Advances: '24797 crore).
Karnataka Vikas Grameena Bank (KVGB) operates in 9 districts of Karnataka with 629 branches & 76 ATMs. The total business of the Bank as at March 2021 is '27818 crore. (Deposits: '16100 crore, Advances: '11718 crore).
Aggregate business of the RRBs increased to '1,58,930 crore as at March 2021 with a y-o-y growth of 9.45% comprising Deposits of '85,749 crore and Advances '73,181 crore. Through the Bank's infrastructure support, the RRBs are extending facilities, like, ATM cum Debit Card services and installed 741 ATMs / Cash Dispenser as at March 2021. The sponsored RRBs are 100% CBS compliant and are ahead of their peer RRBs under technology front by extending IT based products, like Internet Banking, Mobile Banking, RuPay Debit Card services and also Aadhaar enabled services and remittance facilities through NEFT / RTGS to their customers. The RRBs have put in place Cheque truncation system and e-KYC technology.
Following the founding principles and century old tradition, the Bank is engaged in varied Corporate Social Responsibility (CSR) activities. CSR initiatives of the Bank are multifarious, covering activities like training unemployed rural youth, scholarship to meritorious SC / ST Girl students, repair of schools and providing of other infrastructural facilities to needy educational institutes, providing primary health care, drinking water, community development, empowerment of women, environment protection, swatch Bharat and other social initiatives. A few social initiatives are outlined below.
S Cumulatively, the Bank has sponsored / co-sponsored 78 training institutes, which have trained more than 10.93 lakh unemployed youth so far, with a settlement rate of 73%.
S The Bank has donated 4 hi-tech, custom- built, solar powered 'Retail Mobile Marketing Van' to assist women entrepreneurs, SHGs and artisans to market their products.
S Canara Vidya Jyothi Scholarship scheme to meritorious SC / ST Girl Students. During FY 2020-21, 7606 students have been benefitted utilizing a total amount of '2.89 crore.
S Financial assistance for combating poverty & malnutrition to persons with disability (PWD), homeless and people effected by floods & Pandemic COVID-19 for supporting to lead a better life.
S During the difficulties of COVID-19 situation, the Bank has taken efforts to ensure that the difficulties faced by the general public are redressed to the maximum extent possible.
S Providing of Food Packets, Groceries, Medical Kits, Distribution of Blankets, Ambulance van are among the few activities that were being organized.
S Under CSR the Circles have also organized various activities as mentioned above.
S Bank has also assisted Differentially abled people by providing Wheel Chairs, Tricycles, Walking Sticks etc.
S Bank also provided financial support for the welfare of Ex-servicemen.
S Families of COVID-19 victims were identified and they were provided with financial assistance.
S During the FY 2020-21, under the Sustainable & Development Corporate Social Responsibility (SD&CSR) initiatives of the Bank, the Bank has spent to the tune of '24.71 crore to various sectors like Skill Development, Financial Inclusion, Women Empowerment activities, Education, Environment Protection, Health, Poverty & Nutrition, Person with Disability, Rural Development, Swachh Bharat, & Sports & other Sectors.
During the year 2020-21, Standing Committee on Urban
Development (2020-21) and National Commission for
Backward Classes, conducted Study Visits and reviewed
our Bank's performance.
AWARDS / ACCOLADES & ACHIEVEMENTS
S In IBA's 16th Annual Banking Technology Awards, Canara Bank received Joint Runner-up award for Best Payment Initiatives.
S Canara Bank received Finnoviti 2021 award for Integration of Govt Scheme Demat Trading Insurance.
S Public Relations Council of India has given bronze award for our in-house Magazine Shreyas under House Journal - Print (English) category.
S In 59th ABCI Annual Awards, Canara Bank's in-house Magazine "Canara Jyothi" has received awards under "Indian Language Publication" and "special column (language)" categories.
S Canara Bank has received "Award of par Excellence" in APY Big Believers 3.0 (ABB) organised by PFRDA.
S Canara Bank has received "Exemplary Award" from PFRDA for achievement under Atal Pension Yojana "Old Age Financial Freedom Fighters".
SÂ Canara Bank has received "Certificate of Excellence -Amazing Achievers of APY" from PFRDA.
Sl No. |
Name Designation |
Designation |
Date of Appointment |
Date of Cessation |
1 |
Shri T N Manoharan |
Chairman |
14.08.2018 |
13.08.2020 |
2. |
Shri S Krishnan |
Executive Director |
01.04.2020 |
03.09.2020 |
3. |
Shri Matam Venkata Rao |
Executive Director |
09.10.2017 |
28.02.2021 |
4. |
Shri Debashish Mukherjee |
Executive Director |
19.02.2018 |
10.02.2021 Extended further till 10.02.2023 |
5. |
Shri K Satyanarayana Raju |
Executive Director |
10.03.2021 |
09.03.2024 |
(Appointment / Cessation of Directors during the year 2020-21)
Shri K Satyanarayana Raju was appointed as Executive Director w.e.f 10.03.2021, by the Central Government u/s 9 (3) (a) of the Banking Companies (Acquisition and Transfer of Undertakings)Act, 1970 until further.
Shri T N Manoharan ceased to be Chairman w.e.f.
13.08.2020 Â Â Â upon completion of tenure.
Shri S Krishnan ceased to be Executive Director w.e.f.
03.09.2020    upon elevation to Managing Director and Chief Executive Officer of Punjab & Sind Bank.
Shri Matam Venkata Rao ceased to be Executive Director w.e.f. 28.02.2021 upon elevation to Managing Director and Chief Executive Officer of Central Bank of India.
The Directors, in preparation of the annual accounts for the year ended March 31, 2021, confirm the following:
⢠   That in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.
⢠   That they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit or loss of the Bank for the period.
⢠   That they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of applicable laws governing banks in India for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities.
⢠   That they had prepared the annual accounts on a going concern basis.
⢠   Internal financial controls followed by the Bank are in accordance with guidelines and that such internal financial controls are adequate and were operating effectively.
⢠   The directors had devised proper systems to ensure compliance with the provision of all applicable laws and that such systems were adequate and operating effectively.
SECRETARIAL AUDIT FOR FINANCIAL YEAR 2020-21
Pursuant to the requirements of Regulation 24A of the SEBI (LODR) Regulations, 2015 & SEBI Circular CIR/CFD/ CMD1/27/2020 dated February 08, 2020, the Bank has appointed Mr. S. VISWANATHAN Practicing Company Secretary (CP No. 5284) as the Secretarial Auditor for 2020-21 and their report addressed to the members of the Bank which forms part of this Annual Report is attached as an annexure to the Board's report.
The Board wishes to place on record its sincere appreciation to the customers for their patronage, to the shareholders for their support, to the Government authorities and the Reserve Bank of India for their valuable guidance and support, to the Directors who completed their tenure during the financial year under review, to the Bank's Correspondents in India and abroad for their co-operation and goodwill and to all the Staff Members for their full support in the pursuit of organizational growth and excellence.
MANAGING DIRECTOR & CEO
Mar 31, 2019
The Board of Directors have pleasure in presenting the 50th Annual Report together with the Balance Sheet as on 31st March, 2019 and Profit & Loss Account for the financial year ended March 31, 2019.
FINANCIAL INCLUSION:
Holistic Approach to Financial Inclusion
With the basic objective of bringing the large unserved population under the banking mainstream, the Bank is striving towards a more inclusive growth by making financial products and services available to financially excluded and marginalized sections of the society in particular. As per the Government of India and the Reserve Bank of India directions, the Bank has been actively pursuing the agenda of Financial Inclusion, with key interventions, viz., expanding banking infrastructure, offering appropriate financial products, making extensive & intensive use of technology and through advocacy of financial literacy.
The Bank has 903 Financial Inclusion (FI) Branches under branch model and also engaged 2459 Business Correspondent Agents (BCAs) under Business Correspondents (BC) model. In addition, 471 Ultra Small Branches (USBs) are also operational in the Bank.
Pradhan Mantri Jan Dhan Yojana (PMJDY):
PMJDY is the initiative from Government of India for comprehensive financial inclusion of the population of India, particularly aiming at covering the households hitherto excluded from the purview of banking and empowering them with benefits and facilities provided by the banking industry. Accounts opened under PMJDY are issued with Rupay Debit card, accidental Insurance coverage to the extent of Rs.2 lakh, life insurance cover of Rs.30,000/- (for accounts opened upto 31.01.2015) and overdraft upto Rs.10000/- after six months of satisfactory dealing. The Bank was allotted 3962 Sub Service Area (SSAs) and 3371 Urban Wards for implementation of PMJDY.
Performance highlights under PMJDY:
- Opened 72.80 lakh accounts under PMJDY and mobilized a CASA deposit of Rs.2450.68 crore.
- Covered all allotted 10049 villages comprising of 3962 allotted SSAs and 3371 Urban wards by opening of 903 brick & mortar branches and engaging 2459 Business Correspondent Agents (Bank Mitras) at remaining locations. Hand-held devices enabled for accepting RuPay Cards are provided to Bank Mitras for facilitating payments, The Bank has issued 42.89 lakh Rupay Debit Cards to all eligible account holders. Bank Mitras have done 141.87 lakh transactions, amounting to Rs.3132 crore during the year.
- Zero balance accounts under PMJDY have been brought down to 11.67%.
- Provided overdraft facilities upto Rs.10,000/- to all eligible PMJDY account holders. 1.10 lakh PMJDY accounts holders have been provided with overdraft facility, amounting to Rs.13.51 crore during the year. So far the Bank has provided PMJDY overdraft facilities to 7.32 lakh account holders to the extent of Rs.111.49 crore.
Social Security Schemes:
Under various social security schemes launched by the Government of India during the year, following enrolments have been made.
Scheme Wise Enrolments As at March 2019 |
|
Scheme |
Enrolments as at March 2019 |
Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) |
26.69 lakh |
Pradhan Mantri Suraksha Bima Yojana (PMSBY) |
75.28 lakh |
Atal Pension Yojana (APY) |
75.28 lakh |
Under Sukanya Samriddhi Yojana, the Bank has mobilized 17383 accounts
Apart from the above, the bank has also made significant progress in the Financial Inclusion related activities during the year as under:
Business canvassed in the FI Branches:
FI branches have garnered business of Rs.21410 crore, which includes CASA deposits of 5627 crore, constituting 26.28% of total deposits. Average business per FI branch stood at Rs.23.74 crore.
Position of Basic Savings Bank Deposit (BSBD) Accounts:
The Bank has opened 8.83 lakh BSBD accounts during the year 2018-19, taking the tally of BSBD accounts as at March 2019 to 175.32 lakh, with an outstanding deposit of Rs.5427 crore.
Formation & Credit Linking SHGs:
Financing to Self Help Groups has played pivotal role for poverty alleviation and financial inclusion of the rural poor. The Bank has formed 11026 SHGs and credit linked 89237 SHGs with an outlay of Rs.2889 crore during the year. The outstanding SHG accounts were more than 1.49 lakhs, with an outstanding amount at Rs.3796 crores.
Farmersâ Clubs:
The Bank has adopted the concept of forming Farmersâ Clubs, which is an association of progressive farmers, who have volunteered to disseminate the principles of development through credit and also inculcate better repayment ethics and promote peopleâs participation. During the year, the Bank has formed 737 Farmers Clubs.
Micro Finance Branches:
The Bank has opened 18 Micro Finance Branches in the urban centres. These branches mobilized a total business of Rs.679.38 crore as at March 2019.
Financial Literacy Centres:
Formed âCanara Financial Advisory Trustâ to take care of the affairs of the Financial Literacy Centres (FLCs) of the Bank as well as the FLCs promoted by the Regional Rural Banks (RRBs) sponsored by the Bank. Pan India, the Bank has 72 FLCs in 26 lead districts and 46 blocks across the country, managed by the Counsellors (retired bankers).
Financial Literacy Initiatives:
- Financial Literacy Centres have educated 21.05 lakh persons during the year and 84.68 Lakh persons since inception.
- Special training is being provided to Branch Managers for conducting financial literacy programmes at their branches and in their service area.
- Conducted 65 financial literacy camps under Financial Inclusion Fund Scheme from the NABARD.
AADHAAR
Seva Kendras:
The Bank is a Registrar and Enrolment Agency for Aadhaar Enrolment. The Bank has established 740 Aadhaar Seva Kendras inside 10% of the bank branch premises, comprising of 613 centres for the bank and 127 centres for the 2 sponsored RRBs (PKGB 65 & KGB 62), duly complying with the UIDAI guidelines.
AADHAAR
Seeding:
93% of operative SB accounts and 88% of PMJDY accounts have been seeded with Aadhaar Number. Further the bank is in the process of seeding all remaining operative SB and PMJDY accounts with Aadhaar number through close monitoring to achieve the target of 100%.
AADHAAR
Authentication:
Demographic authentication of accounts with UIDAI has been done successfully for nearly 200 lakh accounts. For the remaining accounts e-KYC biometric and OTP utility has been enabled in the SAS package for branches. In web portal, the Bank has provided a link for the internet banking customer to authenticate on their own. In ATM, authentication status checking facility has been provided for the customers.
CORPORATE SOCIAL RESPONSIBILITY
Setting Examples in CSR Activities
Following the founding principles and century old tradition, the Bank is engaged in varied Corporate Social Responsibility (CSR) activities. CSR initiatives of the Bank are multifarious, covering activities like training unemployed rural youth, scholarship to meritorious SC / ST Girl students, providing primary health care, drinking water, community development, empowerment of women and other social initiatives.
Rural Development:
The Bank, through its Canara Bank Centenary Rural Development Trust (CBCRDT), has established 31 exclusive training institutes, including 23 Rural SelfEmployment Training Institutes (RSETIs), 5 Institutes of Information Technology and 3 Artisan Training Institutes to promote entrepreneurship development among rural youth and encourage them to take up self employment activities. During 2018-19, these Institutes trained 20,728 candidates, taking the tally to 3.38 lakh unemployed youth since inception, with an impressive settlement rate of 75%.
The Bank has co-sponsored another 27 Rural Development and Self Employment Training Institutes (RUDSETIs) across 17 States, for training of rural youth for taking up self-employment programmes. During 2018-19, these Institutes trained 22,068 candidates, taking the tally to 4.69 lakh unemployed youth, with a settlement rate of 73%. The Bank has also co-sponsored Bankers Institute for Rural and Entrepreneurship Development (BIRED) at Hyderabad, Telangana and Canara Bank Deshpande RSETI at Haliyal, Karnataka Farmers Resource Centre (KFRC) at Bagalkot and Bharat Ratna Shri M Visvesvaraya Training Institute at Bengaluru, Karnataka. Cumulatively, the Bank has sponsored / co-sponsored 62 training institutes, which have trained more than 8 lakh unemployed youth so far, with a settlement rate of 74%. The Bank has donated 4 hi-tech, custom built, solar powered âRetail Mobile Marketing Vanâ to assist women entrepreneurs, SHGs and artisans to market their products.
The major thrust areas are skill development for employment /self employment through Institutional set up, Health care initiatives in co-ordination with reputed Hospitals, promoting Education through direct and indirect support through smart classes, construction of toilets for girl students, providing computers and other infrastructural support, direct financial help to students with scholarship facilities, a helping hand to Persons with Disabilities etc.
Environment Protection
The Bank has undertaken an ambitious project of providing Solar Street Lights and Tree Guards at Dehra Village, Panipat, Haryana. Tree Plantation Project initiated through National Institute of Oceanography, Chennai, Tamilnadu. The Bank has also actively participated in Government of India, Swachh Bharat activities during the year 2018-19.
Health care for the Underprivileged
Hi-tech Ambulance was provided to M/s Sri Jayadeva Institute of Cardio Vascular Sciences & Research, Bengaluru for their unit at Mysore under the CSR initiatives of the Bank. The Bank has also provided Medical Equipment to Rural Development Trust, Ananthpur, Kurnool, AP. An Ambulance Van was donated to the District Administration, Wayanad, Kerala, mainly for the use of Scheduled Tribe & underprivileged Cancer patients of the District Cancer Centre, Nalloornad, Wayanad. M/s Rajiv Gandhi Centre for Biotechnology, (RGCB Trivandrum, Kerala, has been provided 2 Vans for transportation of patients in critical conditions & movement of laboratory technologists in case of exigencies. Sanitary Napkin Vending Machines and Incinerators were installed in eleven Govt. Schools at Siliguri, Sikkim, for the benefit of underprivileged girl students of the Govt. schools of Sikkim. The Bank also assisted M/s Swiss Emmaaus Leprosy Relief Work India, Chennai, Tamilnadu for reconstructive surgery of leprosy patients.
Direct and Indirect support to Education
Education being one of the prime sectors of CSR and a vital part of personality development, the Bank apart from its own initiatives, has assisted various educational institutions for better facilities and for spreading the coverage of education.
Canara Vidya Jyothi Scholarship scheme to meritorious SC/ST Girl Students:
Scholarship were provided for meritorious girl students from 5th to 10th standard, studying in Government and Government aided schools for the sixth successive year and 9160 students have been benefitted utilizing a total amount of Rs.3.48 Crores during 2018-19. 46610 girl students have been benefitted amounting to Rs.17.86 Crores under the scheme since inception.
Under CSR initiative, the Bank has assisted St.Paulâs Mission School, Kolkata, West Bengal for renovation of Class room to Library cum audio visual room and E-learning facilities were provided in three Government Schools in association with M/s Centenary Charitable Trust, Chennai Tamil Nadu. The Bank has provided infrastructural facilities like Class Rooms, Hall & Toilets to Shri Durgaparameswari Proudashala, Shakatapuram, Koppa, Karnataka. The Bank has provided Desks, Benches and other furniture to the Govt. Model Higher Primary School, Nagashetty Halli, Bengaluru; Govt. Primary School, Vidya ranyapura, Bengaluru, Karnataka; the Govt. School, Thevaram, Madurai, Tamilnadu; Govt. School Kuttichal, Trivandrum and Utility items to Govt. High School Dehra Village, Hariyana. The Bank assisted promotion programme for Green Protocol initiatives for School Students in Varkala, Kerala.
Financial assistance to combat Poverty & Nutrition
The Bank has given financial assistance to M/s Adamya Chethana, for procuring Automatic Roti Making Machine at Jodhpur under âRajasthan Kitchen for School Childrenâ as a part of mid-day meal programme. The Bank has provided Food, Clothes and other essential items to relief camps in flood affected areas of Kerala through our CO/ROs. The Bank has provided essential items to M/s Sanmati Bal Niketan, Pune, Maharastra.
For supporting persons with disability to lead a better life
A number of programmes in association with likeminded agencies were taken up. In connection with this, the Bank has provided essential items for imparting vocational training to visually impaired persons; Wheel chair to disabled students; Refrigerator to Pratibha Ashram Orphanage home on the eve of Independence Day Celebrations; Blankets to Old age home; School bags, Books to mentally challenged children; 4 brail watches to blind poor persons in Mumbai, Maharastra. etc. The Bank has provided Refrigerator to the Roman & Catherine Lobo School for Visually impaired, Mangaluru, Karnataka. The Bank assisted M/s Snehadeep Trust to sponsor of Bags to blind participants, Bengaluru, Karnataka; contributed to Asha Niketan High School for Deaf, Bhopal on Golden Jubilee Celebration of the School. The Bank has assisted Ekadasha, School for Mentally Retarded Children, Chennai, Tamilnadu, and assisted M/s Umang Bal Vikash, Patna, to procure Audio Visual Instrument for the disabled students. The Bank has also provided financial assistance for Tour & Camp for Differently abled Children at Kollam, Kerala.
Visits by Parliamentary Committees
During the year 2018-19, Parliamentary Committees relating to Government Assurances, Subordinate Legislation, Standing Committee on Agriculture, Social Justice and Empowerment, Welfare of OBCs, SCs & STs visited the Bank.
ORGANISATION AND SUPPORT SERVICES Branch Network Expanding Pan India Presence
In a bid to expand the reach, the bank added 32 domestic branches and converted 84 Retail Asset Hubs as general branches during the year. As at March 2019 the Bank had 6316 branches, including Specialized Branches and 6 overseas branches.
Composition of Branch Network
Category |
No. of Branches |
Opened during the year |
|
31.03.2018 |
31.03.2019 |
||
Metropolitan |
1242 |
1282 |
6 |
Urban |
1162 |
1204 |
5 |
Semi-urban |
1991 |
2003 |
9 |
Rural |
1809 |
1821 |
12 |
Overseas |
8 |
6 |
0 |
Total Branches |
6212 |
6316 |
32 |
Note: 10 domestic branches were merged / closed during the year.
2 Overseas branches were merged / closed during the year.
The total Specialized Branches of the Bank stood at 287 as at March 2019.
Specialized Branches |
31.03.2019 |
AF (Hi-Tech) Branches (AFB) |
8 |
Asset Recovery Management Brs (ARMB) |
20 |
Br. For Physically Challenged Persons |
1 |
Capital Market Branches (CMB) |
1 |
Government Business Branch (GBB) |
6 |
IF Branches (IFB) |
3 |
Mahila Banking Branches (MBB) |
2 |
Micro Finance Branch (MFB) |
17 |
NRI Branches (NRIB) |
9 |
Overseas Branches (OB) |
11 |
Prime Corporate Branches (PCB) |
12 |
Savings Branches (SSB) |
0 |
SME Branches (SME) |
166 |
Stock Exchange Branches(SEB) |
2 |
Mid Corporate Branches (MCB) |
24 |
Digital Banking Branches (DBB) |
4 |
Aquaculture Finance Branches (ACF) |
1 |
TOTAL |
287 |
PROGRESS IN DIGITAL BANKING & ALTERNATE DELIVERY CHANNELS:
The bank has 8851 number of ATMs as on March 2019. The Bankâs EMV debit card base is at 2.82 crore. Besides the above, 182 hi-tech E-lounges were operational in select branches, with facilities like ATM, Cash Deposit Kiosk with voice guided system, Cheque Deposit Kiosk, Self Printing Passbook Kiosk, Internet Banking Terminal, Online Trading Terminal and Corporate Website Access. Interactive Video Conference System was also configured at select e-Lounges.
As a result of such alternate delivery channels adopted by the Bank, the e-transaction ratio increased to 79.42% as at March 2019 compared to last yearâs 76.50%. The number of registered users under new version of Mobile Banking is at 21.86 lakhs and Net Banking users increased to 61.87 lakhs as at March 2019. Digital Branch - CANDI, was opened at Bangalore, Chennai, Delhi & Mumbai with fully automated facilities and robotic assistance for customers to open accounts and do transactions themselves.
New functionalities introduced in Mobile Banking during FY 2018-19:
- New version of Mobile Banking app with better User Interface is released with additional features like integration of Bharat Bill Payment system, UPI App etc.
New functionalities introduced in Internet Banking during FY 2018-19:
- Introduction of Debit card services such as
- Request for New Debit card
- Enable / disable - International Debit Card & set ATM Limit
- Creation, Modification & Cancellation of Standing Instructions
- OLTS integrated to apply for Housing / Education / Vehicle & MSME loans
- Aadhaar Seeding / Authentication
- Self-registration for CANDIGITAL app.
- Preprinted login password kit for Retail and corporate customers.
- Introduced option to set multiple transaction limits for retail users / corporate customers within the maximum limits.
- Single Beneficiary list introduced for NEFT / IMPS & RTGS transactions
- Re-Print / Download TD receipt
- Income Projection for Deposits
- Display of applicable interest, maturity details, ROI, liquidation details etc., at the time of prematre closure.
New applications released apart from Mobile & Internet Banking functionalities during FY 2018-19
- Canara DiYA (Digitally Your Account) - Instant savings account opening facility for the branches & customers through multiple channels such as SAS Package (Walk in customers), Website of the Bank, Mobile app (Android & iOS). All the services like Debit Card, Internet Banking, Mobile Banking, UPI, E-Pass sheet are activated instantly. Full KYC is to be ensured within one year.
- One Time Settlement (OTS) Package is introduced for customers to apply for OTS and branches to follow-up & monitoring of OTS accounts.
- Online Web portal for customers to request for replacement of Magnetic stripe card with EMV chip card.
- NPS All Citizen Model - National Pension System for All Citizen portal has been enabled for the public to apply for PRAN under New Pension Scheme.
- Canara Fee Collect - Online Fee collection portal for Institutions is introduced.
New functionalities introduced in ATM during FY 2018-19:
- First bank to introduce EMV compliance for Security and Risk Mitigation measures for card transactions implemented in our ATM SWITCH.
- A Unique Option âAadhaar Seeding / Authenticationâ is introduced in our ATMs.
- Implemented Rupay EMV Dual Interface Issuer Application through National Common Mobility Card (NCMC).
- Credit Card Services at Switch level implemented for Canara Saathi app - for customers to Block / Unblock, Hotlist and Green Pin generation.
- As a fraud prevention measure SMS is sent to cardholders when wrong pin is used in ATM / POS.
New functionalities introduced in Government Business & Financial Inclusion during FY 2018-19:
- New Packages for handling Government Business -
Pension, Kisan Vikas Patra, Senior Citizen Savings Scheme, Gold Monetization Scheme, PPF, OLTAS & RBI - Relief Bond modules are released for branches / offices.
- Sukanya Samrudhi account transfer functionality for inter-branch and interbank and post office enabled.
- Sukanya Samrudhi Application - Introduced facility for online payment of subscription using Internet Banking credentials.
- Online subscription of Sovereign Gold Bond in-house package released.
- E-payment of direct tax with maker-checker functionality for corporate customers through Internet banking enabled.
- Tax Payment using Debit Card - enables our customers to make Tax payment using Debit Card. - AADHAAR Seeding / Authentication - through ATM / Bankâs Corporate Website & Branches with Virtual ID, Token ID and Limited KYC functionality and Mobile Banking/ Internet Banking enabled.
- Fixed Point BC solution - Aadhaar Enabled Payment System (AEPS), RuPay card and Third party deposit transactions along with Balance enquiry and Mini statement released.
Compliance to International Standards:
The Bank has fully implemented the recommendations of the RBI Working Group (Chairman, Shri G Gopalakrishna) on Information Security, Electronic Banking, Technology Risk Management and Cyber Frauds.
Manpower Profile:
As at March 2019, the Bank had 58350 employees on its roll. The cadre-wise break-up of manpower is as follows:
Cadre |
March 2018 |
March 2019 |
Officer |
28739 |
29882 |
Clerk |
21551 |
19951 |
Sub-staff* |
8565 |
8517 |
Total |
58855 |
58350 |
*includes Part Time Employees (PTEs)
Total staff strength of the Bank was comprised of 51% Officers, 34% Clerks and 15% Sub Staff. The Women staff strength of the Bank was 17,796, constituting 30% of the employees. The total number of ex-service men staff as at March 2019 stood at 4,547. There were 1483 Physically Challenged Employees on the rolls of the Bank. During the year, the Bank recruited 2724 persons in various cadres, out of which 462 belonged to Scheduled Castes (SCs) and 214 to Scheduled Tribes (STs) categories.
419 ex-servicemen were recruited in various cadres during the year. 765 women employees were recruited and 977 women were promoted under various cadres during the year.
Reservation Policy in respect of Scheduled Castes and Scheduled Tribess
As at March 2019, the Scheduled Castes and Scheduled tribes together constituted 27% of the total staff strength of the Bank. The composition of SCs/STs employees as at March 2019 was as under:
Cadre |
Scheduled Castes |
Scheduled Tribes |
Officer |
5335 |
2322 |
Clerk |
3736 |
1285 |
Substaff |
2517 |
489 |
Total |
11588 |
4096 |
The Bank has been strictly adhering to the Reservation Policy in respect of Scheduled Castes and Scheduled Tribes as per the Government of India guidelines.
a. Reservation Policy is implemented through the mechanism of Post Based Rosters. In terms of the directives of the Ministry of Finance, Government of India, the Bank has switched over to Post Based Rosters for all cadres.
b. The Bank has been extending Reservation / Relaxations / Concessions in Direct Recruitment as well as in promotions to candidates belonging to Scheduled Castes and Scheduled Tribes as per the Government guidelines.
c. Pre-recruitment & Pre-promotion training is given to candidates belonging to Scheduled Castes and Scheduled Tribes. In the Advertisements inviting application from the eligible candidates for recruitment to Clerical Cadre, a specific reference is being made with regard to imparting of pre-recruitment training to candidates belonging to SC / ST / PWD / Minority Communities / Ex-SM. Pre-recruitment training for Officer Cadre is provided to candidates belonging to SC / ST & Minority Communities. Such of those candidates who opt for pre-recruitment training are given training to prepare themselves for written test as well as interview. The duration of the training is for a week. Study materials, notebook, stationeries are provided free of cost to all the participants.
d. The Bank has set up SC / ST Cells at the Head Office and also at Circle Offices to ensure maintenance of Rosters and proper implementation of other aspects of Reservation Policy.
e. Chief Liaison Officer has been nominated at Head Office and Liaison Officers have been nominated at Circle Offices for ensuring implementation of Reservation Policy. Further, representations received from Scheduled Caste / Scheduled Tribe employees, either directly or through the SC / ST Associations, are being looked into by the Liaison Officer / Chief Liaison Officer. Wherever required, necessary enquiries are conducted & appropriate action is taken. A separate register is maintained for recording various representations received from Scheduled Caste / Scheduled Tribe employees and the action taken is also recorded in the register. In addition to the above, the representatives of majority Scheduled Caste / Scheduled Tribe Employeesâ Association are invited for Quarterly Meeting with the Chief Executive of the Bank to discuss on the implementation of guidelines on reservation policy. Quarterly Meetings are also held at Circle Offices, where Rosters are maintained and grievances, if any, are redressed by the Liaison Officer.
f. The Board of Directors of the Bank also review the progress made in the implementation of Reservation Policy, half yearly and yearly.
HUMAN RESOURCE DEVELOPMENT (HRD) ACTIVITIES
The HR policies of the Bank have been revisited to suit the changing banking scenario. HR initiatives like âSoft skill training programmeâ for bringing attitudinal change among frontline staff and Executives grooming through reputed institutes and other significant HR tools, like, Study Circles, Staff Meetings and Brain Storming Sessions have been implemented for effective team building and fostering collective excellence. Various Corporate Communications were brought out to boost the morale of the employees and educate them in various facets of banking. The Bank has in place an exhaustive training process that cover Internal Training, External Training, In Company Training and Foreign Training. Internally, the Bank has STC at Bengaluru and 25 Regional Staff Training Colleges (RSTCs) across the country. During the year, the Bank has provided training to its employees, covering a wide range of functional areas, including Credit Orientation, Marketing Skills, and Induction Programme for Officers, Agriculture Extension Officers and Specialist Officers.
The Bank has designed and implemented several new training programmes, including credit management and decision making skills, credit appraisal programme for Branch Managers and workshop on recovery aspects for Executives. Under a novel programme, viz., Talent Bank Scheme, a talent pool was formulated, comprising Officers from Scale I to Scale IV, who are willing to take up challenging assignments in the identified critical or specialized areas. Intensive Credit Management Programme is being conducted in 2 phases. This is an in-depth and exhaustive programme on credit matters evolved by Staff Training College, for Officers in Scale I - III, to build specialization in credit. Intensive Training Programme on Credit over the years has built a talent pool of over 1000 Officers.
Further, the Bankâs quest to enhance the competencies of the workforce continued through focused and need based training at various institutes of repute, like, IIMs, XLRI-Jamshedpur, IDRBT-Hyderabad, JNIBF Hyderabad, NIBM-Pune, SIBSTC-Bangalore, CAFRAL and CAB (RBI)-Pune etc. Customized programmes are also organized to develop expertise in certain niche areas, like, Credit, Risk Management, Treasury Operations, HR, forex and IT. Specialized trainings to the Senior Management Level and Top Management Level Executives were conducted based on the requirement. The Bank has been able to add substantially to the skill level of its Officials through training intervention and motivating them to perform with renewed vigour and enthusiasm.
A governing body for the training setup, headed by the Managing Director & CEO has been established to monitor and streamline the training policies of the Bank. A scheme for Training as Incentive to Top Performers has been formulated, and was incorporated as a part of Banks Training Policy whereby, top performing officers are sent for training at External institutes of repute.
Changes brought about in the organizational set up during 2018-19:
The Bank follows four-tier structure with 21 Circle Offices and 118 Regional Offices as controlling and monitoring offices between the Head Office and Branches.
Earlier, the Bank had launched âProject Shikharâ aimed at rejuvenating the Bank by focusing on various themes, like, better branch layout & customer service for customer delight, quality service delivery & reduction in service time, focus on digital banking by promoting transactions on self-service machines and alternate channels, inculcating sales culture and focus on business, particularly CASA and Non-Interest Income growth. In the journey of transformation of branches, number of âShikhar Branchesâ rose to 1547, with 240 branches under 5 Star and 122 under 4 Star categories as at March 2019.
Marketing and Publicity:
The Marketing Vertical has played a significant role in improving the CASA share, retail business, fee income from the Associate Parties business, wallet maximization and propagating the multifarious technological products and services for the benefit of the customers.
The Bank further strengthened the marketing vertical during the year by inducting specialized personnel into the setup, overseen by the dedicated Marketing Executives. The Marketing set up has taken initiatives in cross selling and up selling of Bankâs products by launching several campaigns during the year. The Marketing Team actively organized and participated in various activities such as âFinancial Exposâ, âCASA Campaignsâ, âRetail Exposâ, âHelp Our Customer Dayâ, âHealth Campsâ, âInsurance Daysâ, âNFO Campaignsâ etc. throughout the year to improve visibility of the Bank, extend reach, serve customers and enhance business.
The Marketing Wing organized Marketing Conclaves to direct, encourage & motivate the Marketing Setup during the year 2018-19. In order to encourage and motivate all the Staff of the Bank to participate in sourcing & recording of business leads for the Bank, the Marketing Vertical launched a Lead Management System âiLeadâ.
The Bank has a healthy following on Social Media platforms Twitter and Youtube. Canara Bank was the First PSU Bank to start an active Twitter Handle in India and the Bankâs handle @canarabanktweet is currently ranked 4th amongst PSBs. It has evolved as a service delivery & grievance redressal channel for customers / non customers. Canara Bank official YouTube channel / canara bank official was launched during FY 2017-18 and within a short span of 9 months became the No.1 amongst PSU Banks.
Customer Orientation:
Several initiatives were taken to remain customer focused through providing fast service, bringing in diversified products & services, responding to customersâ queries and redressal of customer complaints. The âCode of Commitment to Customersâ issued by Banking Codes and Standards Board of India (BCSBI) and âRevised Citizenâs Charterâ of Indian Banks Association (IBA) are made available in the Bankâs homepage of the website <www.canarabank.com>. As per the instructions of IBA and RBI, the Bank has adopted Customer Rights Policy as advised by the RBI since July 2015, which spells out the Rights of the Customers and also responsibilities of the Banker. To assess the quality of customer service rendered by the branches and to get the feedback, an online and offline Customer satisfaction Survey was conducted. As per regulatory requirements, the Bank has appointed an Internal Ombudsman for the Bank. Customersâ Fortnight was conducted from 16.11.2018 to 30.11.2018, inviting suggestions from customers. In order to enhance customer focus, âProject Shikhar - Branch Transformationâ is being implemented since April 2014 wherein various customer centric initiatives like Welcome Desk, Queue Management System (QMS), Single Window Operation and allocation of larger space for âCustomer Waiting Areaâ etc., along with self-service kiosks are put in place. In order to enhance customer convenience / experience, Bank has popularized Missed Call Facility through Canara Swipe, BHIM-Empower, Internet and Mobile Banking, Canara e-info book, Canara mServe, Canara Geo locate and Canara Easy Cash facilities. Besides, the existing Call Center with single point contact Toll free number 1800 425 0018 was converted into a fully outsourced model by name âCall Canaraâ and is functioning to cater to customers in 9 regional languages, viz., Kannada, Malayalam, Marathi, Tamil, Oriya Telugu, Guajarati, Punjabi, and Bengali besides Hindi and English for redressal of grievances. Many interfaces were provided at the call center to enable the agents to resolves first handed simple and routine query without necessitating the need for escalating the branches and other offices. The Bank has implemented online grievance redressal facility of customers in the website for lodging grievances online under the portal Canara Public Grievance Redressal System (CPGRS). The complaints received at the Call Centre of the Bank were also integrated with the CPGRS package. During the year, the Call Centre registered 11200 grievances in CPGRS and all grievances were redressed as per prescribed time norms. Centralized Pension Processing Centre has been established exclusively for handling pensions and resolving pension related grievances. 41 Central Processing Centers are established at selected places for account opening purposes.
The Bank has framed a policy on Customer Protection for limiting liability of customers in unauthorized Electronic Banking Transactions (EBT) in tune with the RBI guidelines. Recognizing the fact that customer protection and financial Inclusion are the two crucial pillars of financial stability and considering the recent surge in customer grievances relating to unauthorized Electronic Banking Transactions (EBT) resulting in erroneous debits to customer accounts / cards, customers are required to report to Bank immediately on knowing the occurrence of the unauthorized EBT. Further, the branches have the obligation to educate the customers to protect themselves from electronic banking and payments related frauds through various channels.
Feedback / suggestions received from customers during quarterly standing committee meeting on customer services were diligently taken up by the Bank, thereby providing more amenities / products for the benefit of customers.
Systems and Procedures:
Risk based Internal Audit (RBIA) was conducted in 5235 branches / service units programmed for onsite RBIA during the year. Information Security audit was conducted along with RBIA. Concurrent / continuous audit was conducted in 973 branches / service units, of which 361 branches / service units were subjected to concurrent / continuous audit by Internal Auditors and 612 branches / service units were subjected to concurrent audit by External Auditors, covering 70% of Advances and 50% of Deposits of the total business of the Bank. 1473 branches were subjected to income / revenue audit on quarterly basis. As part of strengthening the audit process, branches / service units were graded under Four scales - LOW / NORMAL / MODERATE & HIGH in RBIA. The Bank has already implemented computerized audit through Web Based Audit Package called, âDARPANâ, for RBIA of branches, and through other Web Based packages for Concurrent Audit, Income Audit, KYC & AML Audit, Snap audit (for Normal and Moderate Risk rated branches), RO Audit, Circle Audit, Wing Audit, Application Audit and Information System Audit.
Bank has taken a strict policy of nil tolerance on frauds and accordingly the Inspection / Audit policy of the bank has been revised to re-risk rate branches which were witness to fraud; Serious irregularities; etc. as âHigh Riskâ.
Further, Bank has taken various strategic measures for improvement of audit framework of the Bank like rationalisation of mandays for audits; stringent time norms for closure of audit reports; placing of relevant reports / Significant audit findings at periodical intervals before Audit Committee of Executives / Audit Committee of the Board / Board of Directors; introduction of new concepts like Daily Dash Board, interactive sessions with Inspectorates, Inspection Helpdesk; release of exhaustive Compendium of guidelines for audit, Handbook on functioning of Inspectorates; due importance for detection & recovery of income leakage, reduction of overdue Inspection reports, timely submission of reports / returns.
Risk Based Supervision:
The Bank is brought under Risk Based Supervision (RBS) regime by RBI, in lieu of Annual Financial Inspection (AFI) from FY2014-15. Presently, the Bank has completed the 5th cycle of RBS. RBS framework is named as Supervisory Programme for Assessment of Risk and Capital (SPARC). Under SPARC, a detailed qualitative and quantitative assessment of the Bankâs risks is made by the RBI on an on-going basis through a combination of offsite and onsite Risk Discovery Process (RDY).
Know Your Customers (KYC) / AML / CFT:
The Bank has undertaken various measures for the effective implementation of guidelines on Know Your Customer (KYC), Anti Money Laundering (AML) and Combating Financing of Terrorism (CFT).
Some of the major developments and initiatives taken were as under:
- AML / CFT Centralized unit has filed 1404 Suspicious Transaction Reports (STRs) During 2018-19.
- AML / CFT centralized unit is exclusively processing and monitoring of AML/SDN (Specially Designated Nationals) alerts.
- New in-house-AML package was inaugurated on 02.08.2018 with various efficiency features.
- System checks and enhancements implemented for Trade Based Money Laundering (TBML) alerts.
- The centralized unit has attended Specified Bank Notes (SBN) related queries from RBI SBN facility extended to NRIs / people out of India during demonetization period.
- KYC Cell functions as the custodian and one point contact for RBI and Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI) for all CKYC matters.
- Implemented CKYC project on 30.10.2017
- The Bank has issued 58,19,736 CKYC IDs to its Customers, out of 85,56,842 accounts opened since 01.01.2017.
Vigilance Setup
Vigilance Wing of the Bank is headed by the Chief Vigilance Officer (CVO). The CVO is assisted by the Vigilance Officers stationed at all Circles, RRBs and the Bankâs Subsidiaries. Vigilance Management in the Bank includes preventive, participative and punitive functions.
âVigilance Awareness Weekâ was observed in the Bank from 29th October 2018 (Monday) to 3rd November 2018 (Saturday), with the theme âEradicate Corruption â Build a New India and all the Branches / Offices have actively participated in conducting various activities such as Seminars, Workshops, Customer Grievance Redress Meetings, Awareness Sabhas in Gram Panchayats, Panel Discussions, Competitions in Schools / Colleges (viz. Essay Writing, Debate & Quiz Competitions) & Walkathon / Marathons etc to bring awareness in the society about the ill effects of corruption.
Vigilance Awareness Week celebrations commenced with the Integrity Pledge by all the Executives & Employees of HO on 29.10.2018 at 11.00 am in Hindi, English & Kannada languages. Messages received from the Honâble President of India, Honâble Vice President of India and the Central Vigilance Commission were read out. During the function, Vigilance Wing in-house quarterly Magazine âCanara Vigilâ was released by the dignitaries.
During the year 2018, Vigilance Officers Conference was conducted on 23.07.2018 at Head Office, Bangalore. Vigilance Officers from 21 Circle Offices, Inspection Wing, RRBs & FMS Wing were present. CVO of the Bank & GM-HR addressed the participants. Ms. Roopa, SP, CBI/ ACB, Bangalore and Mr. Vivekanandaswamy, IOP, CBI/ ACB, Bangalore were guest speakers to the programme.
Further, Vigilance Wing has conducted Workshops on âVigilance Administrationâ for Investigating Officers, Presenting Officers, Inquiring Authorities & Disciplinary Authorities on 07.09.2018, 16.10.2018 & 22.10.2018 at Kolkata, Head Office & Chennai respectively. Officials from Central Vigilance Commission have participated in the Workshop and addressed the participants.
Security Arrangements:
Out of 6310 branches, and 106 currency chests in 21 Circles / 118 regional offices, the Branch security profile is as follows: High Risk Branches - 44, Normal Risk Branches -1678 and Low Risk Branches: 4588. These Branches & Currency Chests were periodically visited by Security Officers as per statutory guidelines. All the sensitive currency chests were visited by the Chief Security Officer during the year. The following measures were initiated based on the instruction from RBI, IBA & State Police Authorities:
a) All branches, Currency Chests & ATMs have been provided with CCTV cameras & DVR.
b) 873 ATMs (Pan India) and 9 mobile ATMs have been provided with private security guards based on the threat perception and directions from police authority.
c) Notwithstanding the fact that security personnel are âconstantly committedâ to security duties, the bank is geared up to meet all the challenges.
The security set up is regularly upgrading the security apparatus and issuing suitable instructions, advisories and guidelines to all branches from time to time, including focusing on fire safety measures and minimizing damages. 36 Security Officers have undergone basic training on Disaster Management at NIDM New Delhi during 2018-19.
Right to Information:
Under the Right to Information Act, 2005, an exclusive Right to Information Act outfit is functioning to provide information and bring transparency. During June 2016, Department of Personnel Training, Ministry of Finance, Government of India has come out with a web based online RTI portal to enable the citizens to make online applications / appeals. This web based package has been extended to the Public Sector Banks with effect from 20th July 2016. To comply with the RTI guidelines and to cater to the needs, the Bank has nominated a Nodal Officer at Head Office and a Central Public Information Officer (CPIO) and a First Appellate Authority (FAA) for all Regional Offices, Circle Offices and Head Office. Apart from this, the Bank has designated all the branch / unit heads as Assistant Public Information Officer (APIOs) to receive and forward the RTI applications, 1st appeal and to forward the same to the concerned CPIOs and also to assist the CPIOs whenever requested. Presently, there are 140 PIOs and 140 Appellate Authorities.
During the year 2018-19, the Bank received 7519 RTI applications, 936 Appeals & 100 Second appeals as against 3634 RTI applications, 871 Appeals & 9 Second appeals during the previous year, 2017-18.
Implementation of Indian Accounting Standards:
As per RBI guidelines, the Bank is in the process of implementing the Indian Accounting Standards (Ind AS). A Project Steering Committee headed by Executive Director has been formed to take the required steps on a continuous basis for smooth convergence. RBI, vide its communication ref : DBR.BP.BC.No.29/ 21.07.001/2018-19 dated 22nd March,2019 has deferred implementation of Ind AS for all Scheduled Commercial Banks till further notice. Bank is submitting Pro-Forma Financial Statements to RBI for every quarter as per the guidelines of RBI.
Implementation of Official Language:
The Bank made noteworthy progress under the implementation of official language and won many prizes at various levels during the year under review.
As at March 2019, around 86% of employees have obtained working knowledge in Hindi and the Bank has notified 4767 Branches under Rule 10(4) of OL Rules 1976. All the employees of the Bank possessing working knowledge of Hindi have been trained in functional Hindi through Hindi workshops. During the year under review, Bank has conducted 336 refresher training programmes for such employees.
In the sphere of using Information Technology in the Official Language, the Bank has furthered the use of Unicode package for word processing and also made provision in ATM screens of the Bank for carrying transaction in 10 Indian languages. Apart from Hindi and English, transaction slips can be obtained in Malayalam, Tamil, Telugu, Kannada, Punjabi and Marathi from our ATMs (Transactions done in concerned language). Tele banking facility has also been provided in Hindi and English and other 6 major regional languages. The Bankâs corporate website is bilingual. The Bank is also giving SMSs in Hindi to all its customers on special occasions.
The Bankâs bilingual address booklet CANPATHA is made available to all its branches and offices in electronic form. Hindi option is provided in Mobile Banking, E-Infobook and the Bankâs internet Banking portal. To encourage effective implementation of Official Language in the Bank, 381 prizes were given to Circles, Regional offices, Branches, RSTCs and Sections of Head Office & Circle Offices under the award scheme formulated by the Bank, viz., Canara Bank Rajbhasha Akshay Yojana and 80 employees were awarded under Rajbhasha Puraskar Yojana. Bank has also conducted Annual âAll India Hindi Essay Competitionâ for its employees and cash prizes were given to prize winners. Half Yearly Hindi journal âCanarajyotiâ - 21st & 22nd issues were brought out during the year. Canarajyoti was brought out to encourage original writing in Hindi. This publication contains articles on banking related subjects as well as Poetry, Short Stories, Travelogues written in Hindi by employees of our Bank. During the year, Canarajyoti was awarded Gold and Bronze Prize by ABCI under Indian Language category & features (language) category. The 36th All India Conference of OL Officers of the Bank was held at Head Office, Bengaluru on 21st and 22nd Feb 2019. During the year, the Third Sub Committee of Parliamentary Committee on Official Languages had inspected our Joshimath Branch (Delhi CO), Ooty Branch (Chennai CO), Guwahati Circle Office and Tuttukudi Regional Office. The committee lauded the efforts put in by the Bank in the field of Official Language implementation. The Bank is convening the Town Official Language Implementation Committees of Etah, Agra, Hatharas, Coimbatore, Ramnagaram, Bengaluru (Rural), Chitradurga, Chikkaballapur and Thiruvananthapuram. Official Language Implementation Committees are constituted in all the branches of the Bank as per the government guidelines to propagate the progressive use of Hindi.
Promotion of Sports:
Canara Bank has always been encouraging and supporting sports and has contributed generously to sporting activities all over the country by sponsoring tournaments, providing scholarships to talented sports personalities. A Sports Council at Head Office was setup in the year 1982 to monitor and encourage sports activities in the Bank.
The Bank is presently having teams in 6 disciplines.
Category |
Gender |
Members |
Athletics |
Women |
5 |
Ball Badminton |
Men |
3 |
Cricket |
Men |
14 |
Hockey |
Men |
17 |
Shuttle Badminton |
Men |
1 |
Table Tennis |
Men & Women |
2 |
International Sportspersons in the Bankâs fold are Shri B K Venkatesh Prasad & Shri Sunil B Joshi (Cricket), Smt M K Asha, Smt Suma Gopalakrishna (Athletics), & Smt H M Jyothi (Present International Athlete), Shri P Shanmugam, Shri Bharath Kumar Chhetri (Captain Indian Hockey Team, London Olympics-2012) & Shri K M Somanna (Senior-Hockey), Shri K P Dinesh (Junior-Hockey), Shri D Guruprasad, Shri Vineet Manual (Shuttle Badminton). Some of the above sportspersons still don the Bank colours while representing the Bank in tournaments / competitions at the State / National level.
The Bankâs Hockey Team was Runners-up in the 8th Hockey India Senior National B Division Championships at Imphal, Manipur during 2018, and also in the Field Marshal Cariappa Memorial Hockey Tournament at Bangalore. The Cricket Team of the Bank was the Winnersinthefollowing championships: (1)TheKarnataka State Group II Division, (2) I League Championships, and (3) 25th International Paradip Memorial Tournament at Odisha. Further the team was runners up in the All India Pooja Cricket Tournament at Kochi. Apart from the teams at the Head Office, the Bank is also encouraging sports at the Circle levels by allotting annual budget for sports activities and also by organising sports competition for employees, the activities of which are duly monitored by the Circle Sports Councils.
FINANCIAL SUPERMARKET
Canara Bank, with an objective of offering âOne Stop Bankingâ facilities for the customers, forayed into diversified business activities by opening subsidiaries during late 1980s. Today, the Bank functions as a âFinancial Supermarketâ, with ten Subsidiaries / Sponsored entities/ Joint Ventures in diversified fields. All the Subsidiaries / Sponsored entities / Joint Ventures of the Bank recorded satisfactory performance during the year 2018-19.
CANFIN HOMES LIMITED (CFHL):
M/s Canfin Homes Limited, a sponsored entity of Canara Bank is one of the premier housing finance entities in the country. The bank holds 30% stake with the company.
The loans outstanding of the Company as at March 2019 was Rs.18396 crore. The Company earned a profit after tax of Rs.296.74 crore as against Rs.286.19 crore in the previous year, with y-o-y growth of 3.69%. Gross NPAs of the Company was Rs.113.51 crore and Net NPA was Rs.79.47 crore as on 31.03.2019. 100% dividend for the year 2018-19 has been proposed by the Company.
CANARA BANK SECURITIES LIMITED (CBSL):
M/s Canara Bank Securities Limited is a wholly owned subsidiary of the Bank. The Company offers stock broking services to both institutional and retail clients.
Online Trading Counter for retail customers is its flagship product and has diversified into Currency Derivatives and has a clientele base of 55503. The Company has posted a profit after tax of Rs.9.71 crore and declared a dividend of 15% for the year 2018-19. CBSL has taken over the Depository Participant operations from Canara Bank with effect from 01.04.2017.
CANARA ROBECO ASSET MANAGEMENT CO LIMITED (CRAMC):
M/s Canara Robeco Asset Management Company Limited is a joint venture (JV) with M/s Robeco Groep N V with the bank holding 51% Stake. This JV was formed in 2007 divesting 49% Stake held by the bank in M/s Can Bank Mutual Fund in favour of M/s Robeco Groep N V. Total Assets under Management (AUM) was at Rs.15516 crore with investor base of 9.92 lakhs as at March 2019. The Company is currently managing 29 Mutual Fund Schemes, including Gold Exchange Traded Fund. The Company has posted a net profit of Rs.24.61 crore and declared a dividend of 11% for the year 2018-19.
CANBANK FACTORS LIMITED (CFL):
M/s Canbank Factors Limited is a factoring subsidiary of the Bank with 70% stake held by the Bank. During 2018-19, the Company had a total business turnover of Rs.1702 crore. The Company incurred a profit of Rs.2.72 crore after making provisions amounting to Rs.11.39 crore for the doubtful debts for the year 2018-2019.
CANARA HSBC ORIENTAL BANK OF COMMERCE LIFE INSURANCE COMPANY LIMITED (CHIOCe):
M/s Canara HSBC Oriental Bank Of Commerce Life Insurance Company Ltd (CHIOCe) is a Life Insurance Joint Venture floated by the Bank in association with HSBC Insurance (Asia Pacific) Holding Limited and Oriental Bank of Commerce in the year 2007. The JV commenced its business operations with effect from 16.06.2008, with majority shareholding of 51% by Canara Bank, followed by HSBC (26%) and Oriental Bank of Commerce (23%). The Company recorded new business premium of Rs.1367 crore and gross premium of Rs.3491 crore during the year. The Company has 4,62,403 in-force policies as on 31.03.2019. The Company achieved a statutory profit of Rs.165 crore for 2018-19.
CANBANK VENTURE CAPITAL FUND LIMITED (CVCFL):
M/s Canbank Venture Capital Fund Limited is the Trustee and Manager of Canbank Venture Capital Fund and a wholly owned subsidiary of the Bank. The company has managed 5 funds so far with total Asset under Management (AUM) of Rs.552.78 crore. The latest fund is the Emerging India Growth Fund with a corpus of Rs.435.86 crore. CVCFL has been appointed by the Department of Electronics and Information Technology (DeitY) to manage the Electronic Development Fund (EDF) with a corpus of Rs.2206 crore, with Rs.2200 crore from Government of India, Rs.5 crore from Canara Bank and Rs.1 crore from CVCFL. Another new fund named as âEmpower India Fundâ is being setup with a target corpus of Rs.650 crore. The Company recorded a profit after tax of Rs.4.50 crore and has proposed to pay a dividend of 1000% for the year 2017-18.
CANBANK COMPUTER SERVICES LIMITED (CCSL):
M/s Canbank Computer Services Limited is the only Software Company promoted by a Public Sector Bank in the country, with a 69.14% shareholding by the Bank. CCSL is primarily engaged in IT and software development services, BPO services, ATM / Any Time Payment services, Training, Consultancy and R&T agent. The Company has posted a profit after tax of Rs.3.01 crore and proposed a 30% dividend for 2018-19.
CANBANK FINANCIAL SERVICES LIMITED (CANFINA):
M/s Canbank Financial Services Limited is confining its activities to legal matter arising out of past transactions in securities and recovery of dues under decreed accounts. The Company received extension of time limit from the RBI for further period of three more years up to 31.01.2020 for disposing off its assets.
COMMERCIAL INDO BANK LLC (CIBL):
M/s Commercial Indo Bank LLC, a joint venture of Canara Bank and State Bank of India has been operational since April 2014 in Moscow, Russia. The company incurred net loss after tax of US$ -1.82 million during the year.
CANARA BANK (TANZANIA) LIMITED:
M/s Canara Bank (Tanzania) Limited is wholly owned Subsidiary of the Bank at Dar es Salaam in Tanzania, registered in Tanzania on 02.11.2015 and obtained a banking license from the Bank of Tanzania on 05.05.2016. The subsidiary commenced its business operations from 09.05.2016. The company earned a profit after tax of $0.43 million.
REGIONAL RURAL BANKS (RRBs):
As at March 2019, the Bank had two sponsored RRBs, viz., Kerala Gramin Bank (KGB) in Kerala and Pragathi Krishna Gramin Bank (PKGB) in Karnataka.
Kerala Gramin Bank (KGB) operates in all the 14 districts of Kerala State with 633 branches and 320 ATMs. The total business of the KGB was Rs.34778 crores as at March 2019, comprising a total Deposits of Rs.16881 crore and Advances of Rs.17897 crores. Pragathi Krishna Gramin Bank (PKGB) operates in 11 districts of Eastern Karnataka with 661 branches & 279 ATMs. The total business of the PKGB was Rs.30745 crores as at March 2019 with total Deposits of Rs.15917 crores and Advances of Rs.14828 crores.
Aggregate business of both the RRBs increased to Rs.65523 crores as at March 2019 with a y-o-y growth of 11.28% comprising Deposits of Rs.32798 crores and Advances Rs.32725 crores. Through the Bankâs infrastructure support, the RRBs are extending facilities, like, ATM cum Debit Card services and installed 599 ATMs / Cash Dispensers (320 by KGB, 279 by PKGB) as at March 2019. The sponsored RRBs are 100% CBS compliant and are ahead of their peer RRBs under technology front by extending IT based products, like Internet Banking, Mobile Banking, RuPay Debit Card services and also Aadhaar enabled services and remittance facilities through NEFT / RTGS to their customers. The RRBs have put in place Cheque truncation system and e-KYC technology.
Kerala Gramin Bank (KGB) had received IBA award 2018 for best financial inclusion initiatives. KGB has been awarded 6th ASSOCHAM SMEs excellence award 2018 under Micro lending category. KGB has also bagged Leadership capital award instituted by PFRDA for best performance in enrolling members under APY. KGB has been awarded the Best Bank Award for âRural Developmentâ by Kerala State Bankers Forum. For excellent performance under CTS, KGB has been awarded National Payments ExcellenceAward.In addition to this KGB also bagged IBA Banking technology award 2019, SKOCH award for DIGI KGB & FI@School.
Pragathi Krishna Gramin Bank (PKGB) has received National Award from Ministry of Rural Development (MoRD), Government of India under National Rural Livelihood Mission (NRLM) for Best performance in SHG Linkage for 2017-18 among RRBs (Southern Region). PKGB has received NPCI Special Jury Award for outstanding performance in Issuance of Rupay Debit Cards. PKGB has also received National Award from PFRDA as Best Performing RRB in India under APY for the year 2017-18. Bank has also received many awards by PFRDA under various categories.
The Bankâs sponsored RRBs were the first amongst RRBs to implement e-KYC technology and Aadhaar Enabled Payment System (AEPS). Together, these RRBs had done 13.22 lakh enrolments under the Social Security Schemes.
HIGHER EDUCATION FINANCING AGENCY (HEFA):
Higher Education Financing Agency (HEFA), a not-for profit organisation, is set up by the bank under a joint venture share holder agreement with the Ministry of Human Resource Development (MHRD), Government of India. This agency was set up to leverage funds from the market and supplement them with donations and CSR funds to finance improvement of infrastructure in Indiaâs Premier Higher education institutions viz., IIT, IIIT, IISER, etc to make them world class. HEFA is set up for developing the educational infrastructure, particularly R&D infrastructure thereby enabling the institutions to reach top rankings globally. This agency has an initial authorized capital of Rs.2000 Crore which is proposed to be contributed in the ratio of Rs.1000 Crore by MHRD, Rs.100 Crore by Canara Bank and Rs.900 Cr. from other Corporates. The paid up equity of HEFA as on date is Rs.300 Crore of which Rs.250 Crore by MHRD and Rs.50 Crore by Canara bank.
HEFA has so far approved projects to the tune of Rs.2,015 Crore for 7 institutions of which Rs.85 Crore has been disbursed. HEFA also has proposals to the tune of Rs.9818 Crore from 16 institutions and the appraisal process is underway.
AWARDS / ACCOLADES & ACHIEVEMENTS:
In recognition of the varied initiatives, the Bank was conferred with the following awards during the year 2018-19.
- Secured Chamber of Indian Micro Small & Medium Enterprises (CIMSME) awards for best bank for promotional schemes (Large category).
- Received runner up CIMSME award for best MSME bank (Large category) and financially inclusive bank (Large category).
- Secured PFRDAâs best performing PSB award in APY performance and the splendid seven awards for the APY campaign
- Secured 1st position in Digital Score Card among all PSBs published by Ministry of Electronics and Information Technology (MeitY) as on 31.12.2018.
- Achieved 106.04% of pro-rata target of 48 Crores Digital Transactions by MeitY. (The Bank was allocated 64 Crores Digital Transactions for FY 201819 by MeitY)
- Post introduction of BHIM OR in August 2018, the enrolment crossed 3,70,179 Merchants as of MarRs.19.
- Enrolled 97,725 Merchants under BHIM Aadhaar PoS as of MarRs.19.
- Number of Merchants enrolled has increased to 5,31,156 as of MarRs.19 from 3,83,092 in MarRs.18 registering a substantial increase under all seven Digital Payment Platforms.
- Secured eight awards in the Collateral Awards Category during 13th Global Communication Conclave; out of which 3 Gold for Television Commercials, Advertising Corporate Campaign RADIO and Advertising Corporate Campaign Television.
- Bagged four awards from the Associated Chambers of Commerce and Industry of India (ASSOCHAM) under its Social Banking Excellence Awards 2018.
- Bagged 1st Runner up award for Credit-off take under EASE Banking Reforms.
- Conferred Best Performing Bank for in house model in terms of Aadhaar Generation and Update through our Aadhaar Seva Kendra among the Banks by UIDAI.
VARIOUS POLICIES OF THE BANK
There is a system of implementing well-defined policies and procedures in the Bank. During the year, concerted efforts were made to streamline the policies and procedures of the Bank in the light of regulatory requirements of the RBI, the directions of the Government of India and the emergent requirements of the Bank in the present day context. Accordingly, there has been a sharper focus on policies relating to, among others, Credit Risk Management, Market Risk Management, Operational Risk Management, Asset Liability Management, Liquidity Risk Management, Group Risk Management, Country Risk, Counterparty Bank Risk, Corporate Governance, Disclosures, Collateral Management, Stress Testing, Compliance Functions, Disaster Recovery and Business Continuity Planning, Business Lines, Outsourcing and ICAAP, KYC, AML, Recovery and Investments.
CHANGES IN THE BOARD OF DIRECTORS
Year 2018-19 saw the following changes in the composition of the Board of Directors of the Bank.
Changes in the Bankâs Board of Directors during the year 2018-19
Sl. No. |
Name Designation |
Designation |
Date of Appointment |
Date of Cessation |
1 |
Shri Rakesh Sharma |
Managing Director & CEO |
11.09.2015 |
31.07.2018 |
2 |
Smt P. V. Bharathi |
Executive Director |
15.06.2016 |
31.01.2019 |
3 |
Ms A . Manimekhalai |
Executive Director |
11.02.2019 |
10.02.2022 |
As per Government ofIndia notification dated 13.08.2018, Shri. T N Manoharan has been re-nominated as Part Time non-official Director on the Board of Directors of Canara Bank for a term of two years with effect from 14.08.2018 and extended his appointment as non-executive Chairman of the Bankâs Board.
Changes in the Bankâs Board of Directors after March 2019
Sl. No. |
Name Designation |
Designation |
Date of Appointment |
1 |
Shri. R.A. Sankara Narayanan |
Managing Director & CEO |
15.04.2019 |
2 |
Shri. R. Kesava n |
RBI Nominee |
26.04.2019 |
Brief Profile of the newly appointed Directors of the Board of the Bank during 2018-19
Ms. A. Manimekhalai is a Master of Business Administration (Marketing) degree holder from Bangalore University and also has CAIIB qualification. She joined Vijaya Bank as Officer in 1988 and has three decades of all round banking experience as Branch Head, Regional Head and functional head of various Departments at Corporate Office.
As General Manager of Vijaya Bank, she has headed the Bangalore North Region of the Bank. She had wide cross-functional experience at Corporate Office with responsibility for policy making, strategic planning, setting organizational goals & growth strategies, action plans, compliance with regulatory guidelines, driving business growth, performance reviews, internal control, liaison with regulatory authorities, and various other functions.
She was instrumental in driving business growth and effective NPA management, conceptualization, design and launch ofvarious retail Assets and Liabilities products, design and launch of Marketing campaigns, implementation of Risk Based Supervision (RBS) system in Vijaya Bank, transition from manual Risk Based Internal Audit (RBIA) regime to total computerised online system, significantly enhancing the integrity, reliability, speed and adherence to regulatory requirements, Implementation of computerized, online Concurrent Audit system, Significant contribution for improvement of compliance culture, due diligence, supervision, oversight and monitoring mechanism across the bank.
Ms. A. Manimekhalai has taken charge as Executive Director of Canara Bank on 11.02.2019.
Brief Profile of the newly appointed Directors of the Board of the Bank after March 2019
Shri R.A. Sankara Narayanan is a post-graduate in Public Administration with MBA in Finance, CAIIB, Post Graduate Diploma in Project Management (PGDPM), Post Graduate Diploma in Financial Management (PGDFM), Diploma in Treasury, Investment and Risk Management (DTIRM), DCP, BRM.
He joined Bank of India (BoI) as a Direct Recruit Officer in the year 1983 and headed various Branches, Zones, and National Banking Groups across India and many other Departments in Corporate Office including Treasury, Retail, and International Banking with Overseas assignments at Tokyo and Singapore. He has rich experience and exposures in all segments of Banking including Treasury, International Banking, Corporate Credit, Risk Management, Compliances, Retail, Marketing, Recovery, Human Resources.
As Executive Director of BoI from May 2015, he was responsible for Treasury, Corporate Credit, Recovery, Risk Management, Compliance apart from International Banking, Retail, HR, IT, Planning, Finance etc.
He has represented BoI in various Boards - including P.T. Bank of lndia Indonesia Tbk, Bank of India- Tanzania, Commonwealth Finance Corporation Ltd (CFCL-Hongkong), BOI New Zealand Ltd, BOI Shareholding, SUD Life Insurance. He was Managing Director & Chief Executive Officer of Vijaya Bank from 01.09.2017 till 31.03.2019.
He has taken charge as Managing Director & Chief Executive Officer of Canara Bank on 15.04.2019.
Shri. R Kesavan joined RBI in the year 1993 as a Direct Recruit Officer in Grade âBâ. He has served various departments with core and specialized functions relating to currency management, banking and non-banking supervision and a stint with the Bankâs Zonal Training Centre at New Delhi. Before taking over as Principal, RBSC, he supervised the entire supervisory domain in RBI, Chennai which included banking, non-banking and co-operative bank supervision, foreign exchange department and customer education and customer protection cell. During his 7 year tenure with banking supervision at Central office of RBI, he served as the Senior Supervisory Manager of State Bank of India during 2015 & 2016. He was also associated as RBI nominee on ICAIâs Audit and Assurance Standards Board for two years.
DIRECTORSâ RESPONSIBILITY STATEMENT
The Directors, in preparation of the annual accounts for the year ended March 31, 2019, confirm the following:
- That in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.
- That they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit or loss of the Bank for the period.
- That they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of applicable laws governing banks in India for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities.
- That they had prepared the annual accounts on a going concern basis.
- Internal financial controls followed by the Bank are in accordance with guidelines and that such internal financial controls are adequate and were operating effectively.
- The directors had devised proper systems to ensure compliance with the provision of all applicable laws and that such systems were adequate and operating effectively.
SECRETARIAL AUDIT FOR FINANCIAL YEAR 2018-19:
Pursuant to the requirements of Regulation 24A of the SEBI (LODR) Regulations, 2015 & SEBI Circular CIR / CFD/ CMDl / 27 / 2019 dated February 08, 2019, the Bank has appointed Mr. S. VISWANATHAN Practicing Company Secretary (COP 5284) as the Secretarial Auditor for FY 2018-19 and their report addressed to the members of the Bank which forms part of this Annual Report is attached as an annexure to the Boardâs report.
ACKNOWLEDGEMENT
The Board wishes to place on record its sincere appreciation to the customers for their patronage, to the shareholders for their support, to the Government authorities and the Reserve Bank ofIndia for their valuable guidance and support, to the Directors who completed their tenure during the financial year under review, to the Bankâs Correspondents in India and abroad for their co-operation and goodwill and to all the Staff Members for their full support in the pursuit of organizational growth and excellence.
R A SANKARA NARAYANAN
MANAGING DIRECTOR & CEO
Mar 31, 2018
The Board of Directors have pleasure in presenting the 49th Annual Report together with the Balance Sheet as on 31st March, 2018 and Profit & Loss Account for the financial year ended March 31, 2018.
FINANCIAL PERFORMANCE
Operating profit of the Bank increased to Rs.9548 crore compared to Rs.8914 crore last year. Due to increase in provisions and contingencies on account of stressed loan book, the Bank reported a net loss of Rs.4222 crore for 2017-18 compared to a net profit of Rs.1122 crore during last year. Net Interest income of the bank increased by 23.21% to Rs.12163 Crore compared to Rs.9872 crore generated during last year.
Key Financial Ratios (%) |
March 2017 |
March 2018 |
Cost of Funds |
5.65 |
5.17 |
Yield on Funds |
7.42 |
7.34 |
Cost of Deposits |
6.25 |
5.60 |
Yield on Advances |
8.99 |
8.12 |
Yield on Investments |
7.75 |
7.63 |
Net Interest Margin (NIM) |
2.23 |
2.42 |
Return on Assets (RoA) |
0.20 |
(0.75) |
Return on Equity (RoE) |
4.15 |
(16.74) |
Cost to Income Ratio |
48.85 |
50.03 |
NIM improved to 2.42% against the last yearâs 2.23% and Cost of Deposit reduced to 5.60% from 6.25% a year ago.
Income and Expenditure Analysis:
During the year, total income stood at Rs.48195 crore, comprising Rs.29096 crore interest from loans and advances, Rs.10412 crore interest from investments, Rs.6943 crore from non-interest income and Rs.1744 crore from other income.
In line with the thrust areas for the Bank, non-interest income (Excl. Trading profit) registered a growth of 9.80% to Rs.5020 compared to Rs.4572 crore during last year. Apart from trading profit, other major sources of non-interest income, like, service charges (Rs.2195 crore), commission and exchange (Rs.1200 crore), recovery from written off accounts (Rs.936 crore) and Profit from exchange transaction (Rs.538 Crore) contributed to the non-interest income of the Bank. The share of non-interest income to total income stood at 14.41% from last year level of 15.43%.
Total expenditure of the Bank came down by 3.45% y.o.y to Rs.38647 crore from Rs.40028 crore incurred during last year. Interest expenses of the Bank declined by 7.70% to Rs.29089 crore. Operating expenses increased by 12.28% to Rs.9558 crore, comprising staff cost of Rs.5444 crore and other operating expenses of Rs.4114 crore. Due to downward movement in the interest rates, the Bankâs cost of deposits reduced by 65 bps to 5.60% from from the last yearâs 6.25%.
The net interest income, the difference between interest paid and interest earned by the Bank, increased by 23.21% to Rs.12163 crore compared to the last years Rs.9872 crore.
Capital and Reserves:
Net worth of the Bank, as at March 2018 stood at Rs.23086 crore compared to Rs.26914 crore as at March 2017. While the total paid-up capital of the Bank stood at Rs.733 crore, the reserves and surplus increased to Rs.34872 crore.
(Amt. Rs. Crore)
Composition of Capital |
March 2017 Basel III |
March 2018 Basel III |
Risk Weighted Assets |
338999 |
351698 |
CET I |
30226 |
33455 |
CET I (%) |
8.92 |
9.51 |
AT I |
2896 |
2769 |
AT I (%) |
0.85 |
0.79 |
Tier I Capital |
33122 |
36224 |
CRAR (%)(Tier I) |
9.77 |
10.30 |
Tier II Capital |
10472 |
10280 |
CRAR (%)(Tier II) |
3.09 |
2.92 |
Total Capital |
43594 |
46504 |
CRAR(%) |
12.86 |
13.22 |
Capital Adequacy Ratio, under Basel III, improved to 13.22% as at March 2018 against the regulatory requirement of 10.875%, including capital conservation buffer of 1.875%. Within the capital adequacy ratio, CET I ratio was at 9.51% and Tier I capital ratio was at 10.30%.
The Bank is comfortable in the capital front. Government has infused a capital of Rs.4865 crore in FY18, thereby Government shareholding in the Bank has increased to 72.55% from 66.30% a year back. Adequate headroom is available to raise capital in order to support the business growth momentum.
BUSINESS GROWTH
Deposits:
Total Deposits increased to Rs.524772 crore as at March 2018 compared to Rs.495275 crore a year ago, with a y.o.y growth of 5.96%.
Current and Saving (CASA) deposits of the Bank increased by 11.54% y-o-y to Rs.167035 crore as at March 2018. The Bankâs CASA deposits share to domestic deposits improved to 34.28% from the last yearâs 32.85%. Savings deposits grew by 11.70% to Rs.142051 crore. Current deposits grew by 10.64% to Rs.24984 crore. The focus on premier CASA products, like, Canara Galaxy, Canara Privilege, SB Powerplus and NRI accounts was given to improve the average balances under CASA.
Pursuing a strategy of expanding deposit clientele, the Bank added 42 lakhs deposit clientele accounts during the year, taking the total number of deposit accounts to 7.39 crore.
Advances (net):
The Bank expanded its asset base to a well diversified one comprising of the productive segments of the economy, like, Agriculture and Micro, Small and Medium Enterprises (MSMEs) and other productive sectors in addition to Retail assets, including Housing, Education, and Vehicle loan segments.
As against the 10.3% growth in advances of the Industry as a whole, advances (Net) of the Bank grew by 11.61% to reach Rs.381703 crore as at March 2018 compared to Rs.342009 crore a year ago.
The number of borrowal clientele accounts increased to 88 lakhs as at March 2018.
Total business of the Bank increased to Rs.906475 crore, with a y-o-y growth of 8.26% compared to Rs.837284 crore in the previous year.
During the year, the Bankâs total clientele base increased by 48 lakhs to 8.27 crore from the last yearâs level of 7.79 crore.
RETAIL LENDING OPERATIONS:
In line with the thrust areas set for the year, the Bankâs retail lending operations recorded good y-o-y growth.
(Amt. Rs. Crore)
Retail Segments |
As at March |
Y.O.Y Growth |
||
2017 |
2018 |
Quantum |
(%) |
|
1. Housing |
32285 |
40075 |
7790 |
24.13 |
1.1 Housing (Direct) |
24337 |
28308 |
3971 |
16.32 |
1.2 Housing (Indirect) |
7948 |
11767 |
3819 |
48.05 |
2. Vehicle |
5140 |
6739 |
1599 |
31.11 |
3. Other Personal |
13835 |
21601 |
7766 |
56.13 |
4. Education |
7651 |
8438 |
787 |
10.29 |
Total Retail Loans(1 2 3 4) |
58910 |
76853 |
17943 |
30.46 |
The outstanding retail loans portfolio grew by 30.46% y-o-y to Rs.76853 crore as at March 2018. The disbursals under various retail lending schemes amounted to Rs.52229 crore. The outstanding housing loan portfolio rose to Rs.40075 crore, with a y-o-y growth of 24.13% and accounted for 52.15% of the total retail lending portfolio. Vehicle loans and other personal loans increased by 31.11% and 56.13% y-o-y respectively.
Education Loans:
Over the years, the Bank has assisted substantial number of promising students to pursue higher education in India and abroad. The Bankâs education loan portfolio increased to Rs.8438 crore. The Bank has financed around 2.99 lakh students as at March 2018. The Bank is performing consistently well with progressive growth in education loan segment. During 2017-18, the Bank has disbursed education loans worth Rs.1452 crore.
1000 institutions rated as âAâ grade by NAAC have been mapped for providing education loans to students of these institutes. A Memorandum of Understanding (MOU) has been signed with National Skill Development Corporation (NSDC) for sanction of education loans for students pursuing vocational courses in affiliated institutes of NSDC throughout the country. An MOU has also been signed with The Institute of Company Secretaries of India, New Delhi for extending education loans. Tie-up arrangements are made with M/s BIOCON Ltd, M/s Bosch Ltd, M/s Bombay Stock Exchange Institute, and M/s Volvo Eicher Commercial Vehicles Pvt. Ltd., to encourage vocational education loans.
Government of India has set-up a fully IT-based Student Financial Aid Authority to administer and monitor scholarships as well as Educational Loan Schemes, through Pradhan Mantri Vidya Lakshmi Karyakram to ensure that no student misses out on higher education for lack of funds. A Vidya Lakshmi portal <www.vidyalakshmi.co.in> has been made live on 15.08.2015. The students can apply online for Education Loan from any bank. The Bank has also in place âVidya Turantâ, an online instant loan sanction facility to students and âVidya Sahayâ, a bridge loan scheme for making down payment for Common Entrance Test (CET), at the time of selection and counselling.
The Bank has been designated as the Nodal Bank for administering subsidy schemes of Government of India, which includes Central Scheme of Interest Subsidy on Educational Loans (CSIS), National Rural Livelihood Mission(NRLM), Padho Pardesh subsidy scheme to provide Interest Subsidy on Education Loans for overseas studies pursued by students belonging to notified minority communities and Dr.Ambedkar Central Sector Scheme Of Interest Subsidy On Educational Loan for Overseas Studies for Other Backward Classes (OBCs) & Economically Backward Classes (EBCs).
Several initiatives were undertaken by the Bank to expand retail credit. During the year the Bank popularized its Online Instant in-Principle Sanction for Housing Loan and Car Loan platform, Pradhan Mantri Awaas Yojana, Housing cum Solar Loans and also Housing Loans to High Net worth Individuals (HNIs), Non-Resident Indians (NRIs) and Agriculturists. Nationwide launching of Campaigns, conduct of Expos, offering competitive interest rates, tie-up with reputed Builders, Car Dealers, introduction of Direct Selling Agents etc., have helped the Bank in expanding its retail loan portfolio.
Five new Retail Asset Hubs were opened, taking total number of RAHs to 83 across major centers in the country. The Bank also implemented several tech-based initiatives like missed call facility for retail lending Schemes, informing due dates and amount of EMIs for housing loans and introduction of web-based lead generation system.
INTEGRATED TREASURY
Aggregate investments (net) of the Bank stood at Rs.144054 crore as at March 2018. While modified duration of the investments portfolio stood at 4.99 as at March 2018, the modified duration of the Available for Sale (AFS) portfolio has increased to 4.44 as at March 2018 from 4.02 as at March 2017. The yield on investments works out to 7.63% as at 31st March 2018 as compared to 7.75% as at 31st March 2017 due to sale of securities and profit booking during the period. The trading profit under domestic treasury operations during the year decreased to Rs.1923 crore from Rs.2982 crore in March 2017 due to volatile market conditions and increased yield.
The Bank continues to be an active player in the Government Securities Market as a Primary Dealer (PD). The total amount of bids submitted for underwriting was Rs.46723 crore, of which, the underwriting commitment accepted by the RBI was Rs.19609 crore. With regard to Treasury Bills under PD business, as against the minimum success ratio of 40% to be achieved in each half year, the Bank has a success ratio of 47.94% for the first half year ended September 2017 and 43.28% for the second half year ended March 2018.
Foreign Business Turnover of the Bank aggregated to Rs.261469 crore, comprising of Rs.95317 crore under exports, Rs.54619 crore under imports and Rs.111533 crore under remittances during the year ended March 2018.
INTERNATIONAL OPERATIONS
The Bank has 8 overseas branches, viz., London and Leicester (U.K), Hong Kong, Shanghai (China), Manama (Bahrain), Johannesburg (South Africa), New York (U.S.A) and Dubai International Financial Centre (DIFC), Dubai (UAE). Besides the above 8 overseas branches, the Bank has a Representative Office at Sharjah (UAE), Canara Bank (Tanzania) Ltd., a wholly owned subsidiary at Dar es Salaam in Tanzania and Commercial Indo Bank LLC, a joint venture bank with State Bank of India in Moscow, Russia. Total business of the overseas branches aggregated to Rs.67962 crore comprising of deposits of Rs.38778 crore and advances of Rs.29184 crore as at the end of the financial year. Overseas Business constituted 7.5% of the Bankâs total business.
As per the directives of the Department of Financial Services (DFS), Ministry of Finance, the Bank has drawn a plan for rationalisation of overseas branches. The Bank has proposed to close/merge its four overseas branches at Leicester (U.K), Shanghai (China), Manama (Bahrain) and Johannesburg (South Africa) and to divest its stake in the Joint Venture at Moscow (Russia).
The Bankâs international operations are well supported by a wide network of 394 Correspondent Banks, spread across 79 countries and the Bankâs overseas branches/ offices. Rupee Drawing Arrangements have been made with 36 Exchange Houses and 25 overseas banks for channelizing the remittances of Non-Resident Indians (NRIs). The Bank is managing two Exchange Houses viz., M/s Al Razouki International Exchange Company, Dubai and M/s Eastern Exchange Est., Qatar under Secondment and Management Agreements respectively.
âRemit Moneyâ, a web-based speed remittance product has been extended to 36 Exchange Houses and also to the Bankâs 4 overseas branches, viz., London, Shanghai and Hong Kong and Canara Bank (Tanzania) Ltd. To facilitate instant and hassle free remittances to the beneficiaries of the Bank in India, âFlashremitâ/âInstant Remitmoneyâ, an instant credit facility is being offered in association with M/s. UAE Exchange, Abu Dhabi, UAE, M/s. Al Razouki International Exchange Company, Dubai, M/s. Eastern Exchange Est., Qatar, M/s GCC Exchange, Dubai, M/s Al Ahalia Money Exchange, Abudhabi, UAE, M/s. Al Ansari Exchange LLC, UAE and M/s Index Exchange, UAE.
OTHER SERVICES
During the year the Bankâs Merchant Banking Division has handled, as arrangers, private placements of Capital Gains Bond Issues of National Highways Authority of India (NHAI) and Rural Electrification Corporation Ltd (REC). The amount mobilized in respect of these issues Capital Gains Bonds Issue of NHAI and REC during the year was Rs.135.10 crore.
As a Collecting Banker, the Bank was involved in two Private Placement Issues, collecting an amount of Rs.1387.48 crore. Further, the bank has handled 236 Public and Debt Issues under Application Supported by Blocked Amount (ASBA) and the amount blocked therein was Rs.2873.08 crore. Three specialized assignments of âFair Valuation of Equityâ were also handled by the Division during the year.
The Syndication Group handled projects, involving project cost of Rs.3838 crore during the year, with a total debt size of Rs.3159 crore. The Group generated a fee-based income of Rs.2.98 crore during the year. The funds were arranged for projects in various segments like Infrastructure (Railway Freight Corridor, Hospital, Educational Institution) and Commercial Real Estate.
The Bank has tie-up arrangements in both life and non-life insurance segments under its âBancassuranceâ arm. During the year, the Bank earned a commission income of Rs.76.6 crore from its joint venture, viz.,
M/s Canara HSBC OBC Life Insurance Company Ltd. Under the Mutual Fund business, the Bank earned a commission of Rs.26.9 crore from its joint venture, viz., M/s Canara Robeco Asset Management Company Ltd. A commission income of Rs.26.9 crore was earned under Non-Life (General) Insurance business from its tie-up arrangements with M/s Bajaj Allianz General Insurance Co Ltd, M/s TATA AIG General Insurance Co. Ltd, M/s The New India Assurance Co. Ltd and M/s United India Insurance Company Ltd. The Bank also earned a commission income of Rs.20.8 crore from its tie-up agreement with M/s Apollo Munich Health Insurance Co. Ltd for marketing their health insurance products. The Bank also has Corporate Agency Agreement with M/s Export Credit Guarantee Corporation of India for marketing export policies through its branches across India.
In order to give further impetus on offering a variety of products and enhance service quality under General Insurance, Bank has entered into a Corporate Agency tie-up with M/s The New India Assurance Co. Ltd and M/s TATA AIG General Insurance Co. Ltd w.e.f 08.06.2017 and 17.07.2017 respectively. The bank has terminated its partnership with M/s United India Insurance Co. Ltd w.e.f 24.06.2017 during the year.
Under Cards Business, the Bank took several initiatives to expand its card base. As at March 2018, total number of Debit Cards increased to 4.30 crore and Credit Cards base rose to 2.23 lakhs.
The Bank offers its âDepository Servicesâ through 32 centres spread across the country. Through these centres, the Bank is extending Online Trading Facility to DP clients of its own broking subsidiary M/s Canara Bank Securities Ltd., Mumbai. In order to have better synergy of operations and efficient delivery of services, the DP activity has been hived off to M/s Canara Bank Securities Ltd., with effect from 01.04.2017.
Executor, Trustee and Taxation Services outfit of the Bank provides services like Debenture/Security Trusteeship, Will and Executorships, Trusteeship, Personal Tax Assistance and Power of Attorney Services.
The Bank undertakes Government Business, comprising Direct and Indirect Tax collections, payment of Central Government and State Government Pensions, Handling of Postal Transactions and State Government Treasury Transactions, Public Provident Fund Scheme and Senior Citizensâ Saving Scheme and distributing Inflation Indexed Bonds of RBI, issuing Sovereign Gold Bonds, Sukanya Samridhi Scheme, accepting deposits under Pradhan Mantri Garib Kalyan Deposit Scheme (PMGKDS) and accepting tax under the Scheme. These products contributed to improvement of CASA and also earned a fee income of Rs.110.28 crore during year.
The Bank provides several online payment services, viz., e-payment of Sales Tax/ Commercial Tax in Maharashtra, Tamil Nadu, Karnataka, Andhra Pradesh, Bihar, Dadra & Nagar Haveli, Odisha, Punjab, West Bengal and Delhi, Virtual Treasury Package in Maharashtra, e-payment of Taxes to Transport Department in Tamil Nadu, Collection of Property Tax for the Corporation of Chennai in Tamil Nadu and Bengaluru in Karnataka, Online opening of PPF Accounts and e-Stamping project in Jharkhand, Uttar Pradesh, Tamil Nadu and Karnataka.
The Bank has been authorized as the accredited banker for Ministry of Human Resources Development (MHRD), Ministry of Culture, Ministry of Youth Affairs & Sports, Archaeological Survey of India and Unique Identification Authority of India (UI DAI), New Delhi. The Bank was implementing the National Pension System for Unorganised Sectors under Swavalamban Scheme since 2012-13. The Government of India has launched Atal Pension Yojana (APY) in place of Swavalamban with a view to provide defined pension to unorganised sector. The Bank could mobilise 4,28,051 accounts under APY as at March 2018.
Goods & Services Tax (GST) (as an agency bank) has been successfully implemented in all of our bank branches since July 01st, 2017.
Agricultural Innovation Centre (AIC) outfit of the Bank handled 113 assignments. Out of, 105 assignments were cleared, which consists of 93 appraisals, 3 vetting and 9 viability studies. The total outlay of the assignments worked out to a term loan component of Rs.723.73 crores and the Bank earned a fee income of Rs.5.91 crores during the year.
ASSET QUALITY
The withdrawal of special dispensation provided for restructuring portfolio resulted in substantial slippages. The consequent stress in the asset quality at the industry level, the Gross Non Performing Assets (GNPAs) to Gross Advances ratio increased to 11.84% as at March 2018 compared to 9.63% as at March 2017. GNPA as on March 31, 2018 stood at Rs.47468 crore compared to Rs.34202 crore in the previous year. With a Net NPA of Rs.28542 crore as on 31st March 2018, the Net NPA ratio was at 7.48% from 6.33% in March 2017.
Cash Recovery during 2017-18 aggregated to Rs.6458 crore compared to Rs.4162 crore in the last year. Recovery from written off accounts stood at Rs.1625 crore as on March 2018 as against Rs.705 crore during the corresponding period of the previous year. Recovery from loss assets during 2017-18 reached Rs.565 crore. During the year, an amount of Rs.943 crore was upgraded from NPA to Performing Assets.
During the year, recoveries amounting to Rs.701 crore were made on account of initiating actions under the SARFAESI Act. The Bank conducted 7661 recovery meets, which resulted in a recovery of Rs.615 crore. During the year 14362 cases were referred to Lok Adalat, out of which, 6229 cases were settled, covering an amount of Rs.22 crore. Besides, the Bank took several initiatives to contain slippages and speed up recovery from overdue loan accounts. These include, conduct of Can Adalats at branch level, cluster adalats at Regional level and mega adalats at Circle level for one time settlements (OTS), Lok Adalats at district level, regular follow-up of overdue in loan accounts through Call Centre, conduct of e-auctions for sale of seized assets and initiation of stringent recovery measures against Wilful Defaulters. As on March 2018, there were 491 wilful defaulters with an outstanding amount of Rs.4759 crore.
The Bank has initiated resolution process in respect of 111 Cases by referring to NCLT / filing our claim as at 31.03.2018 and is expecting substantial recovery through resolution during 2018-19.
The Bank also formulated a special Scheme for settlement of small NPAs (upto Rs.10 lakh), with a special focus on Education/ Agricultural / MSME Loans. In the Educational Loan Sector, two Special OTS schemes were launched with liberal terms and additional concessions for accounts with sanctioned limits up to Rs.4 lakh and for accounts with sanctioned limits above Rs.4 lakh and up to Rs.7.50 lakh. Special Schemes for small value agricultural loans with limit up to Rs.5 lakh and repeatedly restructured due to natural calamities and MSME loans up to Rs.1 crore were launched to provide relief to the affected borrowers.
As on March 2018, the outstanding stressed assets portfolio (including restructured standard accounts) of the Bank stood at Rs.51188 crore, accounting for 12.77% of gross advances.
Risk Management:
BASEL III Capital Adequacy Framework and Future Strategies
An independent Risk Management Wing at the Head Office is functioning as a nodal centre for overall implementation of various risk management initiatives across the Bank. Risk Management Sections are functioning at all 21 Circle Offices of the Bank as an extended arms of the Risk Management Wing.
The Bank has in place risk management policies across geographies and across all risks encompassing the entire gamut of risk profile. These include policies on Credit Risk Management, Operational Risk Management, Market Risk Management, Asset Liability Management and Group Risk Management.
The Bank has in place an Internal Capital Adequacy Assessment Process (ICAAP) under Pillar 2 ofBasel III norms. The ICAAP exercise covers the domestic and overseas operations of the Bank, the Subsidiaries, Joint Ventures, Sponsored Entities and Associates. Stress testing exercise is also performed by the Bank to ascertain the potential risks faced by the Bank. The ICAAP document is reviewed and approved by the Risk Management Committee of the Board and the Board of Directors.
The Bank has a Board Level Sub-Committee for Capital Planning Process. The Committee articulates macroeconomic scenarios vis-a-vis capital requirements of the Bank, in tune with business strategies. The Committee ensures maintenance of appropriate level of Capital to Risk Weighted Assets Ratio (CRAR) and evaluates various options for raising the capital.
Adoption of Advanced Approaches under Basel III:
In an endeavour to move towards Advanced Approaches under Basel III for computation of capital for Credit, Market and Operational Risks, the Bank has engaged the services of a Consultant for implementation of Enterprise-wide Integrated Risk Management solution for itself and the Group Entities, so as to build requisite risk management framework.
As a pre-requisite for the implementation of Enterprise-wide Integrated Risk Management architecture, the Bank has procured a Risk Solution that would enable it to meet requirements of Advanced Measurement Approaches.
The Bank has submitted Letters of Intent to RBI for adoption of Internal Rating Based (IRB) Approach for calculation of capital charge for Credit Risk, Internal Models Approach for calculation of capital charge for Market Risk and Advanced Measurement Approach for calculation of capital charge for Operational Risk.
Preparedness for Basel III:
The final guidelines on Basel III Capital Regulations became effective from 1st April, 2013. As per RBI guidelines, the transitional period for full implementation of Basel III Capital regulations is extended up to 31.03.2019. The banks in India need to maintain a minimum Common Equity Tier 1 (CET1) capital of 5.50%, Tier 1 capital of 7.00%, total capital of 9.00% and Capital Conservation Buffer (CCB) of 2.50% at the end of March 2019. The banks also have to maintain a minimum Tier 1 Leverage Ratio of 4.50% during parallel run as a credible supplementary measure to the risk based capital requirements.
The Bank endeavours to remain adequately capitalized and has drawn plans to meet the capital requirements stipulated by the RBI in transitory phase. The Bank has adequate headroom to raise capital from the market, including recapitalization support from the Government of India. Going forward, the Bankâs capital requirement shall be met by injecting fresh equity capital, retention of profits, optimization of business levels, proactive capital planning and management.
Credit Risk Management:
The Credit Risk management process outlines the principles, standards and approach for credit risk management at the Bank. Systems, procedures, controls and measures are in place to actively manage the credit risks, optimize resources and protect the Bank against adverse credit situations. In order to comprehensively address the issues and concerns of the Credit Risk, the Bank has put in place a comprehensive Credit Risk Management Policy.
A robust system for appraisal of loan/credit proposals, including seeking adequate information for appraising the viability of the proposal and creditworthiness of the applicant for sanctioning credit limits, well defined credit approval process and authorization matrix, standards for collateral management, credit monitoring, restructuring of advances, MSME and Off Balance Sheet Exposures, is followed.
Risk Acceptance, Risk Measurement, Prudential Exposure Norms, Organizational Structure, Strategies and Operational Process are in place. In order to address the credit risk at portfolio level and the issue of concentration risk, the Policy prescribes fixation of various exposure ceilings. Risk Based Pricing is in tune with the Risk profile of the borrower to generate returns to achieve targetted RoA and NIM
The Bank has a Loan Review Mechanism for constantly evaluating the overall performance of the borrowal accounts and for bringing about qualitative improvements in credit administration, monitoring and credit audit. The entire process of the Loan review and monitoring is duly administered by the Credit Administration & Monitoring Wing.
Market Risk Management:
The Market Risk framework of the Bank aims at restricting loss from all types of market risk loss events and also to establish limit structure and triggers for various market risk factors.
Exposure limits, such as, Stop Loss Limits on Trading Book, Intraday and Overnight Limit for various Currency Positions, Dealer-wise Limits, Aggregate Gap Limit, Limits on Money Market Operations, Modified Duration Limits for investment portfolio and VaR Limits are fixed to act as risk mitigants/ triggers. Mid Office of Risk Management Wing monitors these limits, along with other triggers, on a daily basis. A reporting framework has been put in place for effective and timely monitoring of market risk limits and triggers.
Operational Risk Management:
Operational Risk Management framework in the Bank is based on ethics, organization culture and strong operating procedures, involving corporate values, internal control culture, effective internal reporting and contingency planning.
The Bank has adopted polices for management of Operational Risk, which covers various aspects, such as, Operational Risk Management Structure, Outsourcing Activities and Business Continuity Plan.
At present, the Bank is in the process of migration to Advanced Approach of Basel III framework from the Basic Indicator Approach (BIA). The Bank has already put in place Incident Management module for timely reporting of incidents, Review of Key Risk Indicators (KRI), Conducting of Risk Control & Self Assessment (RCSA) workshops and Scenario Analysis workshops to compute capital charge for Operational Risk.
Asset Liability Management:
The ALM Policy of the Bank seeks to strike appropriate balance in the maturity and re-pricing profile of assets and liabilities, so as to reduce liquidity risk and manage interest rate risk. Within the policy framework, the Board of the Bank has set up Asset Liability Management Committee (ALCO), which is entrusted, inter alia, with the role of management of assets and liabilities including the funding strategies and its composition, product pricing, stress test and contingency action plan among others. A balanced ALM structure helps to sustain the spreads, profitability and long-term viability of the Bank.
The Bank has implemented the RBI guidelines with respect to Liquidity Coverage Ratio (LCR) with effect from 01.01.2015. Bank has been computing LCR on a daily basis w.e.f 01.01.2017. As on 31.03.2018, LCR of the Bank is above the stipulated regulatory minimum of 90%.
Group Risk:
The Bank has various Subsidiaries, Joint Ventures and Sponsored Entities, which are engaged in diversified activities. As the Bank has considerable stake in these Group Entities, Bank has put in place a Group Risk Management Policy to identify and manage risk in intra Group transactions and exposures to raise the standard of Corporate Governance by reducing and avoiding conflicts of interest between the Group Entities and also to ensure âArms Length Principleâ among Entities, with regard to business parameters. The Group Chief Risk Officer (GCRO) of the Bank is supervising the risk management activities of the Group Entities.
NATIONAL PRIORITIES
Priority Sector Advances:
The Bank continues to accord importance to varied goals under national priorities, including agriculture, micro and small enterprises, education, housing, microcredit, credit to weaker sections and specified minority communities.
Priority Sector Advances of the Bank as at March 2018 reached Rs.185626 crore, recording a y-o-y growth of 15.82% and achieved 51.69% to Adjusted Net Bank Credit (ANBC) against 40% mandated norm.
(Amt. Rs. Crore)
Priority Sector Advances |
As at March |
Growth |
||
2017 |
2018 |
Amount |
% |
|
Total Priority Sector |
160269 |
185626 |
25357 |
15.82 |
Agriculture |
74079 |
84012 |
9933 |
13.41 |
With a focus on credit delivery to Agriculture, the Bankâs advances under agriculture portfolio increased by 13.41% to Rs.84012 crore, covering over 60 lakh farmers. Under agriculture lending, the Bank achieved 22.17% to ANBC against 18% mandated norm. During 2017-18, the Bankâs agriculture credit disbursal increased to Rs.67902 crore compared to Rs.58691 crore in the previous year.
The Bank undertook special campaigns for extending Crop Loans facility to all farmers.
During the year, the Bank issued 7.48 lakh Kisan Credit Cards (KCCs), amounting to Rs.11939 crore. The credit outstanding under KCCs was at Rs.16450 crore as at March 2018. 7.61 lakh Kisan RuPay Cards were issued against eligible accounts of 7.70 lakh, with an achievement of 98.78%.
The Bank actively participated in various Government Sponsored Schemes, such as, Prime Ministerâs Employment Generation Programme (PMEGP), National Rural Livelihood Mission (NRLM), National Urban Livelihood Mission (NULM), Swarna Jayanti Shahari Rozgar Yojana (SJSRY), and Differential Rate of Interest (DRI) Scheme.
As at March 2018, the outstanding advances under the following Government Schemes, aggregated to Rs.1276 crore, involving around 1.71 lakh beneficiaries.
Performance under various Government Sponsored Schemes:
(Amt. Rs. Crore)
Scheme |
MARCH 2018 |
|
Accounts |
Amount |
|
Prime Minister Employment Generation Programme (PMEGP) |
14924 |
539 |
National Rural Livelihood Mission (NRLM) |
22983 |
548 |
National Urban Livelihood |
3250 |
27 |
Mission (NULM) |
||
Differential Rate of Interest (DRI) |
124473 |
112 |
Swarna Jayanti Shahari Rozgar Yojana (SJSRY) |
5687 |
50 |
Total |
171317 |
1276 |
Advances to DRI stood at Rs.112 crore, consisting of 1.24 lakh beneficiaries, of which, advances by rural and semi-urban branches amounted to Rs.88 crore.
In support of the underprivileged sections of the society, the Bankâs advances to SCs/STs beneficiaries amounted to Rs.7991 crore as at March 2018, covering 5.31 lakh borrowers. The advances to SCs/STs comprised 4.30% of total priority sector advances.
Advances to weaker sections reached Rs.49865 crore, constituting 12.80% to ANBC against mandated norm of 10%.
Various components of advances to Weaker Sections as at March 2018:
(Amt. Rs. Crore)
Sectors |
Outstanding |
|
Accounts |
Amount |
|
Small & Marginal Farmers, Landless Labourers, Tenant Farmers and Share Croppers |
4095215 |
43777 |
Artisans, Village and Cottage Industries |
39557 |
737 |
SC/ST Beneficiaries |
531200 |
7991 |
DRI Loans |
124473 |
112 |
SJSRY Beneficiaries |
5687 |
50 |
Self Help Group |
133582 |
3359 |
Joint Liability Group |
36300 |
754 |
As at March 2018, advances to specified minority communities aggregated to Rs.30821 crore, accounting for 16.58% of the total priority sector advances against the stipulated 15% norm.
Deendayal Antyodaya Yojana (DAY) - National Rural Livelihoods Mission (DAY-NLRM/ Aajeevika):
Under the Scheme Aajeevika, National Rural Livelihood Mission (NRLM) was launched by the Ministry of Rural Development (MoRD), Government of India in June 2011, with an aim to reduce poverty by enabling the poor household to access gainful self employment and skilled wage employment opportunity, resulting in a sustainable livelihood. The main objectives of the Scheme includes providing interest subvention to Women SHGs (WSHGs) from rural areas who avail loans up to Rs.3 lakhs at 7% per annum and to provide an additional subvention of 3% if WSHGs repay in time, thereby reducing the effective rate of interest to 4%. In the first phase, the focus was on 150 most backward districts.
The RBI vide their Circular FIDD.GSSD.CO.BC.No.13/09.01 .03/2016-17 dated 25/08/2016 & FIDD.GSSD.CO.BC. No.17/09.01.03/2017-18 dated 18.10.2017 has intimated that Interest subvention scheme on credit to Women SHG during 2016-17 for all Commercial Banks and Co-operative Banks will be implemented in 100 more districts along with the existing 150 districts. All WSHGs (Women SHGs) promoted by NRLM, NGOs, Central or State Government, NABARD under WSHG Programme which are linked with the banks are eligible for benefits under the Scheme. Ministry of Rural Development, Government of India, has designated Canara Bank as nodal bank for handling claims of banks. The Bank has developed a web portal, which enables all member banks to upload their claims.
(Amt. in Rs. Crore)
Interest Subvention Claims made by all Member Banks |
||
Financial Year |
No of Accounts |
Amount |
2013-14 |
361231 |
266 |
2014-15 |
500829 |
304 |
2015-16 |
568304 |
365 |
2016-17 |
29020 |
394 |
2017-18 |
will be available on 30th June 2018 only. |
Micro Small & Medium Enterprises (MSMEs) Lending:
Advances to MSMEs increased to Rs.82098 crore as at March 2018, with a y-o-y growth of 10.49%. Credit to M&SE segments rose to Rs.65760 crore, with a 22.19% growth against mandated norm of 20%.The number of Micro Enterprises accounts recorded a growth of 3.60%.
Under Pradhan Mantri Mudra Yojana (PMMY), the Bank disbursed an amount of Rs.7435 crore against the target of Rs.6900 crore during 2017-18. Sanctions and disbursals under different schemes of Mudra Yojana are as under:
Category |
As on 31.03.2018 (Amt. in Rs. Crore) |
|||
No. of Accounts |
Sanction Amount |
Disbursement Amount |
Outstanding Amount |
|
Shishu ( |
267394 |
992 |
985 |
873 |
Kishore (Above Rs.50,0005 Lakhs) |
212343 |
4002 |
3868 |
3666 |
Tarun (Above Rs.5 Lakhs to Rs.10Lakhs) |
34032 |
2672 |
2582 |
2503 |
Total |
513769 |
7666 |
7435 |
7042 |
During the year, the Bank has taken following initiatives to increase flow of credit to MSME sector and also to bring about continued awareness about the steps taken.
- 167 SME Specialised Branches are functioning throughout India for faster processing of credit proposals. Besides 167 SME Specialized Branches, 52 SME Sulabhs (Specialised SME Loan Processing Centres) are also functioning across the country.
- To extend financial assistance to micro and small enterprises without offering any collateral security and with relaxed lending terms, some segment specific schemes have been launched / continued, such as, MSME Sahay, Mudra Canara Atithi, Doctorsâ Choice (improved version), MSE SMART, MSME CAP, MSME Vahan, MSE Vijeta and Canara Contractorsâ Scheme, Canara CARAVAN, and MSME Expo..
- To increase the Bankâs exposure to specific clusters and activities, new area/cluster specific schemes have been launched / continued, such as, Canara Textiles, catering to the Textile Sector, Special Scheme for lending to units engaged in Manufacturing of Ceramics and Vitrified Tiles and Weavers Mudra Scheme in lieu of Weavers Credit Card.
- Bank has on boarded into TReDS Platform through RXIL to garner business of Bill Discounting of MSEs through online portal.
- Mega Credit camps are conducted to create awareness and pool sources for increased credit flow to MSME sector.
- Summits were arranged for Start-up Entrepreneurs involving functionaries from different Government Departments and local industrial bodies/ organizations for necessary inputs and guidance for successful entrepreneurship.
- Micro Enterprises Business Centres were established at Circle Offices for handholding Micro Enterprises.
- The Bank has an exclusive website www.canaramsme.com for easy access and understanding of MSME initiatives.
- The online submission of MSME applications and tracking thereof by the customers are facilitated and used extensively by the MSME clientele.
- Entrepreneur Development Centre at Head Office have been catering to the needs of budding entrepreneurs by way of assimilation of information regarding the challenges and opportunities under MSME, conducting seminars, training initiatives, interaction with the concerned organizations and propagation of the same through regular bulletins.
- An exclusive set up established at Head office has been looking into the aspects of monitoring, slippage management and handholding in times of stress by way of rehabilitation and restructuring of MSME units as per Government guidelines.
- Single Point Contact MSME Relationship officers are named in all the 167 SME Specialised Branches to closely liaise with the Top 20 borrower accounts of the Branch and cater to all their requirements on a real time basis.
- Bank has conducted Special lending camps in the UNIDO clusters for sourcing new Proposals and to ensure increased lending to MSME sector.
The Bank is the nodal agency for Credit Linked Capital Subsidy Scheme (CLCSS) of Ministry of MSME, Government of India, for technology upgradation of Micro & Small Enterprises (MSEs). During 2017-18, subsidy amount received from the Ministry under the Scheme was Rs.27.44 crore and the same has been utilized fully during the financial year.
Empowering Women:
Women Empowerment Section at Head office and Centre for Entrepreneurship Development for Women (CEDW) at 21 Circle Offices and 118 Regional offices across the country are working relentlessly towards economic empowerment of women. These CEDWs have reached potential entrepreneurs, undertook counseling, supported their training needs, provided finance and arranged marketing facilities. A total of 342 Programmes were organized by the CEDWs during 2017-18.
These centres have also assisted in the formation of Self Help Groups (SHGs) & Credit Linkages. Rural Self Employment Training Institute set up at Harohalli, Karnataka to provide EDP/skill training to women in various vocations has trained 21,090 women since inception, out of which 638 women have been trained during 2017-18. Through 65 Training Institutes supported by the Bank, 4.32 lakh women have been trained in Self Employment ventures since inception, of which 27,410 have been trained during 2017-18. Apart from establishing two exclusive Mahila Banking Branches, the Bank has equipped over 80 branches with all women employees to give focused attention to women clientele. 18 Micro finance branches are also engaged in supporting the financial needs of Micro & Small Women entrepreneurs & SHG members. 29.99 lakh women have been assisted with a credit outstanding to the tune of Rs.51069 crore as at March 2018 and achieved 15.87% to ANBC as against RBIâs requirement of 5%.
Several concessions have been provided to women borrowers that include relaxation in eligibility norms and 0.50% interest concession on educational loans to girl students. 0.05% interest concession on the Card Rates under Housing Loan to Woman and Vehicle Loan (Personal vehicle) to women. âMSE Vijetaâ, an exclusive loan scheme for women entrepreneurs for loans upto Rs.2 Crore under Micro & small Enterprises and Canara Mahila Savings Scheme, a special Savings Bank deposit product, with many concessions have been devised for women.
During the year, 3 successful âWomen Entrepreneursâ were given cash awards on the occasion of International Womenâs Day under Canara Bank Best Woman Entrepreneur Awards (CBWEA) 2016-17. Under marketing support, the Bank has provided five unique custom built, high tech, solar powered mobile sales vans âCanara Vahiniâ with computerized billing and card swiping facility to enable women entrepreneurs and SHGs to exhibit or market their products at Bengaluru and Shivamogga (Karnataka) and Aligarh (Uttar Pradesh), Coimbatore (Tamil Nadu), and Thrissur (Kerala).
Lead Bank Responsibility :
The Bank has Lead Bank Responsibility in 31 Districts in the country, viz., 8 in Karnataka, 7 in Tamil Nadu, 5 in Kerala, 5 in Uttar Pradesh, 3 in Delhi, 2 in Telangana and 1 in Bihar. The Bank is the Convenor of the State Level Bankersâ Committee (SLBC) in Kerala.
Financial Inclusion:
A Holistic Approach to Financial Inclusion
With the basic objective of bringing the large unserved population under the banking mainstream, the Bank is striving towards a more inclusive growth by making financial products and services available to financially excluded and marginalized sections of the society in particular. As per the Government of India and the Reserve Bank of India directions, the Bank has been actively pursuing the agenda of Financial Inclusion (FI), with the key interventions, viz., expanding banking infrastructure, offering appropriate financial products, making extensive & intensive use of technology and through advocacy of financial literacy.
The Bank has 893 Financial Inclusion (FI) Branches under branch model and also engaged 2459 Business Correspondent Agents (BCAs) under Business Correspondents (BC) model. In addition, 470 Ultra Small Branches (USBs) are also operational in the Bank.
Pradhan Mantri Jan Dhan Yojana (PMJDY):
PMJDY is the initiative from Government of India for comprehensive financial inclusion of the population of India, particularly aiming at covering the households hitherto excluded from the purview of banking and empowering them with benefits and facilities provided by the banking industry. Accounts opened under PMJDY are issued with Rupay Debit card, accidental Insurance coverage to the extent of Rs.1 lakh, life insurance cover of Rs.30,000/-(for accounts opened upto 31.01.2015) and overdraft upto Rs.5000/- after six months of satisfactory dealing. The Bank was allotted 3962 Sub Service Area (SSAs) and 3371 Urban Wards for implementation of PMJDY.
Performance highlights under PMJDY:
- Opened 67.53 lakh accounts under PMJDY and mobilized a CASA deposit of Rs.2058 crore.
- Covered all allotted 10049 villages comprising of 3962 allotted SSAs and 3371 Urban wards by opening of 893 brick & mortar branches and engaging 2459 Business Correspondent Agents (Bank Mitras) at remaining locations.
- Hand-held devices are provided to Bank Mitras for facilitating payments, which are enabled for accepting Rupay Cards. The Bank has issued 42.41 lakh Rupay Debit Cards to all eligible account holders. Bank Mitras have done 122.19 lakh transactions, amounting to Rs.2328 crore during the year.
- Zero balance accounts under PMJDY have been brought down to 11.49%.
- Established a Toll Free number 1800 425 11222 for PMJDY as a part of grievances redressal mechanism and popularized through publication in National Dailies.
- Provided overdraft facilities upto Rs.5000/- to all eligible PMJDY account holders. 1.60 lakh PMJDY accounts holders have been provided with overdraft facility, amounting to Rs.20.48 crore during the year. So far the Bank has provided PMJDY overdraft facilities to 6.14 lakh account holders to the extent of Rs.92.55 crore.
Social Security Schemes:
Under various social security schemes launched by the Government of India during the year, following enrolments have been made.
Scheme Enrolments |
As at March 2018 |
Pradhan Mantri Suraksha Bima |
38.38 lakhs |
Yojana (PMSBY) |
|
Pradhan Mantri Jeevan Jyoti |
13.63 lakhs |
Bima Yojana (PMJJBY) |
|
Atal Pension Yojana (APY) |
4.28 lakhs |
Under Sukanya Samriddhi Yojana, the Bank has mobilized 13679 accounts.
Apart from the above, the bank has also made significant progress in the Financial Inclusion related activities during the year as under:
Business canvassed in the FI Branches:
FI branches have garnered business of Rs.18397 crore, which includes CASA deposits of Rs.4935 crore, constituting 26.82% of total deposits. Average business per FI branch stood at Rs.20.67 crore.
Position of Basic Savings Bank Deposit (BSBD) Accounts:
The Bank has opened 7.67 lakh BSBD accounts during the year 2017-18, taking the tally of BSBD accounts as at March 2018 to 169.88 lakh, with an outstanding deposit of Rs.4892 crore.
Formation & Credit Linking SHGs:
Financing to Self Help Groups has played pivotal role for poverty alleviation and financial inclusion of the rural poor. The Bank has formed 39705 SHGs and credit linked to the extent to Rs.1991 crore to 44439 SHGs during the year. The outstanding SHG accounts were more than 1.30 lakhs, with an outstanding amount at Rs.3359 crore.
Farmersâ Clubs:
The Bank has adopted a concept of forming Farmersâ Clubs, which is an association of progressive farmers, who have volunteered to disseminate the principles of development through credit and also inculcate better repayment ethics and promote peopleâs participation. During the year, the Bank has formed 1002 farmers clubs.
Micro Finance Branches:
The Bank has opened 18 Micro Finance Branches in the urban centres. These branches mobilized a total business of Rs.686.86 crore as at March 2018.
Financial Literacy Centres:
Formed âCanara Financial Advisory Trustâ to take care of the affairs of the Financial Literacy Centres (FLCs) of the Bank as well as the FLCs promoted by the Regional Rural Banks (RRBs) sponsored by the Bank. Pan India, the Bank has 72 FLCs in 26 lead districts and 46 blocks across the country, managed by the Counsellors (retired bankers).
Financial Literacy Initiatives:
- Financial Literacy Centres have educated 18.63 lakh persons during the year and 63.63 Lakh persons since inception.
- Engaged Financial Literacy Coordinators to monitor and motivate Bank Mitras to involve themselves in Financial Literacy in a big way in their sub-service areas and encourage people to do more transactions.
- Trained Bank Mitras through Indian Institute of Banking & Finance and Infrastructure Leasing & Finance Services (IL&FS). They were also provided with extensive training on Banking and Technology aspects by the Bank and the Corporate BCs.
- Special training was given to Branch Managers for conducting financial literacy programmes at their branches and in their service area.
- Conducted 507 financial literacy camps under Financial Inclusion Fund Scheme from the NABARD.
AADHAAR Enrolments Updation Centres:
The Bank is a Registrar and Enrolment Agency for Aadhaar Enrolment. As per UIDAI guidelines, the Bank has to establish 740 centres inside 10% of the bank branch premises, comprising of 613 centres for the bank and 127 centres for the 2 sponsored RRBs (PKGB 65 & KGB 62). Total of 735 Aadhaar Enrolments Updation Centres as on 31.03.2018, comprising of 608 centre for Canara bank and 127 centres of RRBs was established.
AADHAAR Seeding:
Present position in respect of Aadhaar Seeding in CASA accounts is 85.49%. As regards PMJDY accounts, the position is 84.53%. Due to latest Govt notification, the timeline is extended beyond 31.03.2018 till disposal of the writ petition pending at Supreme Court. Close monitoring for ensuring 100% Aadhaar Seeding is under active follow up.
AADHAAR Authentication:
Demographic authentication of accounts with UIDAI has been done successfully for nearly 200 lakh accounts. For the remaining accounts e-KYC biometric and OTP utility has been enabled in the SAS package for branches. In web portal, the Bank has provided a link for the internet banking customer to authenticate on their own. In ATM, authentication status checking facility has been provided for the customers.
CORPORATE SOCIAL RESPONSIBILITY
Setting Examples in CSR Activities
Following the founding principles and century old tradition, the Bank is engaged in varied Corporate Social Responsibility (CSR) activities. CSR initiatives of the Bank are multifarious, covering activities, like, training unemployed rural youth, providing primary health care, drinking water, community development, empowerment of women and other social initiatives.
Rural Development:
The Bank, through its Canara Bank Centenary Rural Development Trust (CBCRDT), has established 34 exclusive training institutes, including 26 Rural Self-Employment Training Institutes (RSETIs), 5 Institutes of Information Technology and 3 Artisan Training Institutes to promote entrepreneurship development among rural youth and encourage them to take up self employment activities. During 2017-18, these Institutes trained 23,123 candidates, taking the tally to 3.07 lakh unemployed youth since inception, with an impressive settlement rate of 76%.
The Bank has co-sponsored another 27 Rural Development and SelfEmploymentTraining Institutes (RUDSETIs) across 17 States, engaged in training of rural youth for taking up self-employment programmes. During 2017-18, these Institutes trained 24,074 candidates, taking the tally to 4.47 lakh unemployed youth, with a settlement rate of 73%. The Bank has also co-sponsored Bankers Institute for Rural and Entrepreneurship Development (BIRED) at Hyderabad, Telangana and Canara Bank Deshpande RSETI at Haliyal, Karnataka Farmers Resource Centre (KFRC) at Bagalkot and Bharat Ratna Shri M Visvesvaraya Training Institute at Bengaluru, Karnataka. Cumulatively, the Bank has sponsored/ co-sponsored 65 training institutes, which have trained more than 7 lakh unemployed youth so far, with a settlement rate of 74%. The Bank has donated 5 hi-tech, custom built, solar powered âRetail Mobile Marketing Vanâ to assist women entrepreneurs, SHGs and artisans to market their products. During the year, the Bank undertook a number of activities for the benefit of the communities as part of CSR.
The Bank has undertaken an ambitious project of providing De-fluoridation - RO plants for pure drinking water facility in fluoride affected villages of Kolar and Chikkaballapur districts, Karnataka. Pure (RO) Drinking water plants have been installed in 156 villages of Kolar District & made operational during the year 2017-18.
The major thrust areas are skill development for employment /self employment through Institutional set up, Health care initiatives in co-ordination with reputed Hospitals, promoting Education through direct and indirect support through smart classes, construction of toilets for girl students, providing computers and other infrastructural support, direct financial help to students with scholarship facilities, a helping hand to Persons with Disabilities etc.
Environment Protection:
The Bank has undertaken an ambitious project of providing RO water plant for pure drinking water to Sree Sreekanteshwara Swamy Temple Trust, Nanjangud, Mysore. The Bank has also actively participated in Government of India, Swacch Bharat activities during the year 2017-18.
Health care for the Underprivileged:
2D Echocardiography Colour Doppler Systems are provided freely for the treatment of underprivileged in M/s Jayadeva Institute of Cardiology, Bangalore. The Bank has also provided Auto haematology analyzer to Arogya Kendra (Primary Health Centre), Gollahalli, Bangalore. E-Rickshaw was donated for transporting patients from one place to another in hospital campus at ICMR- NIRTH Jabalpur, Bhopal. The Bank has sponsored Diesel generator set at super speciality Eye care unit âVivekananda Netralayaâ established by Ramakrishna Mission Ashram, at Dehradun. Canara Bank Relief and Welfare Society, Bangalore were given assistance by the bank towards purchase of medical equipments for Sevakshethra Hospital.
Direct and Indirect support to Education
Education being one of the prime sectors of CSR and a vital part of personality development the Bank, apart from its own initiatives, has assisted various educational institutions for spreading the coverage of education.
Canara Vidya Jyothi Scholarship scheme to meritorious SC/ST Girl Students
The scholarship was provided for those studying in Government and Government aided schools for the fifth successive year and 10,518 students have been benefitted utilizing a total amount of Rs.3.99 crore.
The Bank has provided computer table and other furniture to M/s Bijuala Rama Reddy Charitable Trust, Hyderabad for ZPH School. The Bank has assisted M/s Sasya Shamala Education Society, Hospete, for the purchase of school furniture and construction of toilets in the school. The Bank has also given Computer systems with accessories to M/s Guru Siddeshwara Education Society, Hosadurga.
Financial assistance to combat Poverty & Child Development
The Bank has given financial assistance to the Academy of Magical Sciences, Trivandrum for construction of House to street magicians. âStree Adhyapan Mandir Harijan Ashramâ, Ahmedabad was given personal lockers to facilitate inmates (SC/ST) to keep their belongings.
For supporting persons with disability to lead a better life, a number of programmes in association with likeminded agencies were taken up. In connection with this, the Bank assisted M/s Bhagwan Mahaveer Viklang Sahayata Samiti (BMVSS), an artificial limbs manufacturing NGO at Jaipur, for distributing tricycle and artificial limbs and partnered with M/s Banyan, Chennai for a Rural Mental Health Programme (RMHP). The Bank also distributed motorized tricycle to seven physically challenged persons in Ganj Basoda, Vidisha District, Madhya Pradesh and constructed Braille centre at Canara Bank Relief and Welfare Society, Bangalore
Visits by Parliamentary Committees
During the year 2017-18, Parliamentary Committees relating to Subordinate Legislation, Industries, Commerce, Social Justice and Empowerment, Welfare of OBCs, SCs & STs visited the Bank.
ORGANISATION AND SUPPORT SERVICES
Branch Network
Expanding Pan India Presence
In a bid to expand the reach, the bank added 132 domestic branches during the year. As at March 2018 the Bank had 6212 branches, including Specialized Branches and 8 overseas branches.
Composition of Branch Network
Category |
No. of Branches |
Opened during the year |
|
31.03.2017 |
31.03.2018 |
||
Metropolitan |
1228 |
1242 |
17 |
Urban |
1138 |
1162 |
24 |
Semi-urban |
1936 |
1990 |
55 |
Rural |
1773 |
1810 |
36 |
Overseas |
8 |
8 |
-- |
Total Branches |
6083 |
6212 |
132 |
Note: 3 branches were merged/closed during the year.
The Bank added 4 Specialized Branches during the year, taking the total tally under the Specialized Branches to 289 as at March 2018.
Categories of Specialized Branches |
31.03.2018 |
SME |
167 |
Mid Corporate |
25 |
Micro Finance |
18 |
Asset Recovery Management |
20 |
Prime Corporate |
12 |
Overseas |
11 |
Agri-Finance |
9 |
NRI |
9 |
Savings |
1 |
Industrial Finance |
3 |
Stock Exchange |
2 |
Capital Market |
1 |
Mahila Banking |
2 |
Branch for Physically Challenged |
1 |
Specialized Govt Business Branch |
6 |
Digital Banking Branch |
2 |
Total |
289 |
Progress in Digital Banking & Alternate Delivery Channels
The bank has 9395 number of ATMs as on March 2018. The Bankâs debit card base rose to 4.30 crore compared to 3.30 crore as at March 2017. Besides the above, 174 hi-tech E-lounges were also operational in select branches, with facilities like ATM, Cash Deposit Kiosk with voice guided system, Cheque Deposit Kiosk, Self Printing Passbook Kiosk, Internet Banking Terminal, Online Trading Terminal and Corporate Website Access. Interactive Video Conference System was also configured at select e-Lounges.
As a result of such alternate delivery channels adopted by the Bank, the e-transaction ratio increased to 76.5% as at March 2018 compared to last yearâs 64.97%. The number of registered Mobile Banking users increased to 90.8 lakhs and Net Banking users increased to 48 lakhs as at March 2018.
Digital Branch -CANDI, opened at Bangalore and Chennai with fully automated facilities and robotic assistance for customers to open accounts and do transactions themselves.
Customer-friendly InfoTech Initiatives
Besides bringing improvement in the Mobile Banking and Net Banking features, during the year, the Bank introduced and improved upon several Apps, Tech-products/services for the convenience of the customers.
- Canara DiYA (Digitally Your Account) - A mobile app to instantly apply online for opening new Savings account.
- BHIM Canara Empower - Unified Payments Interface (UPI), a single platform for accessing multiple bank accounts.
- Canmobile - Official mobile banking application of the bank which facilitates fund transfer, IMPS, etc.
- Canara e-Infobook - A mobile app to view e-passbook (transactions details), balance inquiry, A/C summary, Cheque Status, Credit Card info, etc.
- Canara mServe - A mobile app to Switch ON/OFF and Hotlist their Debit and Credit Cards. It also allows setting safe limit for ATM/POS transactions for Debit cards to prevent fraudulent transactions.
- Canara Swipe - all missed call solutions in a single mobile Application.
- Canara OTP - A mobile app which authenticates Internet banking transactions with OTP generated using this app instead of SMS OTP, even when you are out of mobile network coverage area.
- Canara Rewardz - A mobile app to redeem the reward points in Credit Card.
- Canara GeoLocate - A mobile Application which enables a GPS based search for locating Branch / ATMs/E-Lounges of Canara Bank.
- BHIM Aadhaar Pay - App for accepting payments for the sale of goods/services.
- Canara Cart - Customers can manage all mobile apps of Canara Bank under this single mobile app.
- Green Pin - Enables the customers themselves to generate Debit Card PIN at the time of issuance of card and also if PIN is forgotten.
- Customers can directly scan Bharat OR 4.0 of merchants with their EMPOWER application and pay directly with their Master/ Visa/ Rupay Cards.
- First Bank to introduce unique option âAadhaar Statusâ in our ATM using which our card holders can ascertain the status of Aadhaar linking to their account.
- Facility to add/modify and delete nominee enabled through net banking facility
- Implemented Cheque Book indent through SMS
- https://canarabank.gaadi.com provides car models; on-road price & approximate EMI and instant online loan application can be submitted.
- Submission of 15G/H enabled through net banking.
- DIGITAL MITRA, a dedicated staff identified at each branch for helping customers downloading / registration / usage of new digital platforms.
- Implemented Social Security Schemes of Govt. of India, PMJDY OD Automation facility for eligible PMJDY customers for availing OD facility through ATMs. Introduced facility for online account opening under Atal Pension Yojana (APY). Subscription to the Social Security Schemes through ATM, SMS and Internet Banking enabled.
- Enabled Prime Minister Garib Kalyan Yojana Deposit Scheme - 2016 and tax payment through Net Banking and Branches for Pradhan Mantri Garib Kalyan Yojana scheme.
- Web Portals under education loan interest subsidy released for Central Scheme for Interest Subsidy (CSIS), Ministry of HRD, GoI, Dr. Ambedkar Central Sector Scheme of Interest Subsidy (ACSIS), Ministry of Social Justice & Empowerment, Government of India and Padho Pardesh, Ministry of Minority Affairs, Government of India.
- Report suspicious transaction through CPGRS web portal, SMS âSUSPECTâ to 56161, call centers and branches for blocking accounts in case of unauthorized electronic Banking transaction.
- New module for handling Pension Processing & Payment (CPPC) launched to enable timely disbursement of Pension and arrears.
- Canara DigiSign (Digital Signature using eSign Aadhaar OTP facility) released.
- Online Self Registration of Internet Banking for Proprietorship Accounts enabled and online Savings Bank and PPF account opening introduced.
- Recycler functionality for Accepting & Dispensation of cash implemented.
- OTP based Aadhaar seeding and Authentication through Canara Bankâs website using Internet Banking login enabled.
- Aadhaar Number made as one of the key authentication factors to Unlock/Activate/Reset Password for Retail Net Banking customers.
- Enabled Toggling (On/Off) option in Internet Banking for Financial Transactions.
- IMPS limit enhanced from Rs.50,000 to Rs.2,00,000 per customer per day.
- For Corporate customers, Maker-Checker functionality enabled for tax payment through internet banking
- A number of Debit / Credit / prepaid cards launched like Canara Bank RuPay Debit Card, Canara Club Card - Debit, Canara Secured Credit Card, Canara Elite Debit Card, Platinum Rupay Card and EMV Chip Cards.
- Mobile Banking Registration through ATMs (Interoperability through NFS) has been introduced.
To enhance digital transactions, in line with the initiatives of the Government of India, the Bank is on-boarding merchants for increasing usage of Debit and Credit Card payments, Unified Payments Interface (UPI), BHIM App, Bharat OR Code and Aadhaar-enabled Payment Systems (AEPS). The Bank is in the process of implementing more digital initiatives for customer convenience and better service.
Compliance to International Standards:
The Bank has fully implemented the recommendations of the RBI Working Group (Chairman, Shri G Gopalakrishna) on Information Security, Electronic Banking, Technology Risk Management and Cyber Frauds.
Manpower Profile:
As at March 2018, the Bank had 58855 employees on its roll. The cadre-wise break-up of manpower is as follows:
Cadre |
March 2017 |
March 2018 |
Officers |
26127 |
28739 |
Clerks |
20549 |
21551 |
Sub-Staff 1 |
9041 |
8565 |
Total |
55717 |
58855 |
* Includes Part Time Employees (PTEs)
Total staff strength of the Bank was comprised of 49% Officers, 37% Clerks and 15% Sub Staff. The Women staff strength of the Bank was 17,803, constituting 30% of the employees. The total number of ex-service men staff as at March 2018 stood at 4,244. There were 1450 Physically Challenged Employees on the rolls of the Bank.
During the year, the Bank recruited 6404 persons in various cadres, out of which 1039 belonged to Scheduled Castes (SCs) and 456 to Scheduled Tribes (STs) categories. 601 ex-servicemen were recruited in various cadres during the year. 1877 women employees were recruited and 995 were promoted under various cadres during the year.
Reservation Policy in respect of Scheduled Castes and Scheduled Tribes
As at March 2018, the number of Scheduled Castes and Scheduled tribes together constituted 27% of the total staff strength of the Bank. The composition of SCs/STs employees as at March 2018 was as under:
Cadre |
Scheduled Castes |
Scheduled Tribes |
Officers |
5135 |
2209 |
Clerks |
4039 |
1371 |
Sub-Staff |
2562 |
472 |
Total |
11736 |
4052 |
The Bank has been strictly adhering to the Reservation Policy in respect of Scheduled Castes and Scheduled Tribes as per the Government of India guidelines.
(a) Reservation Policy is implemented through the mechanism of Post Based Rosters. In terms of the directives of the Ministry of Finance, Government of India, the Bank has switched over to Post Based Rosters for all cadres.
(b) The Bank has been extending Reservation/ Relaxations/Concessions in Direct Recruitment as well as in promotions to candidates belonging to Scheduled Castes and Scheduled Tribes as per the Government guidelines.
(c) Pre-recruitment & Pre-promotion training is given to candidates belonging to Scheduled Castes and Scheduled Tribes. In the Advertisement inviting application from the eligible candidates for recruitment to Clerical Cadre, a specific reference is made with regard to imparting of pre-recruitment training to candidates belonging to SC / ST / PWD / Minority Communities / Ex-SM. Pre-recruitment training for Officer Cadre is provided to candidates belonging to SC / ST & Minority Communities. Such of those candidates who opt for pre-recruitment training are given training to prepare themselves for written test as well as interview. The duration of the training is for a week. Study materials, note book, stationeries are provided free of cost to all the participants.
(d) The Bank has set up SC/ST Cells at the Head Office and also at Circle Offices to ensure maintenance of Rosters and proper implementation of other aspects of Reservation Policy.
(e) Chief Liaison Officer has been nominated at Head Office and Liaison Officers have been nominated at Circle Offices for ensuring implementation of Reservation Policy.
Further, representations received from Scheduled Caste / Scheduled Tribe employees, either directly or through the SC/ST Associations, are being looked into by the Liaison Officer/Chief Liaison Officer. Wherever required, necessary enquiries are conducted & appropriate action is taken. A separate register is maintained for recording various representations received from Scheduled Caste/Scheduled Tribe employees and the action taken is also recorded in the register.
In addition to the above, the representatives of majority Scheduled Caste / Scheduled Tribe Employeesâ Association are invited for Quarterly Meeting with the Chief Executive of the Bank to discuss on the implementation of guidelines on reservation policy. Quarterly Meetings are also held at Circle Offices, where Rosters are maintained and grievances, if any, are redressed by the Liaison Officer.
(f) The Board of Directors of the Bank also review the progress made in the implementation of Reservation Policy, half yearly and yearly.
Human Resource Development (HRD) activities:
The HR policies of the Bank have been revisited to suit the changing banking scenario. HR initiatives, like, âSoft skill training programmeâ for bringing attitudinal change among frontline staff and Executives grooming through reputed institutes and other significant HR tools, like, Study Circles, Staff Meetings and Brain Storming Sessions have been implemented for effective team building and fostering collective excellence. Various Corporate Communications were brought out to boost the morale of the employees and educate them in various facets of banking.
A high sensitization training programme christened âUTTHANâ was conducted by the Staff Training College (STC), Bengaluru. This training programme was aimed at empowering large number of young employees who have been recently recruited and also other senior employees by sensitizing them regarding Bankâs culture, ethos, sense of belongingness, ownership and concern for customers with a view to achieving the corporate objectives towards growth of the organization. The Bank has in place an exhaustive training process that cover Internal Training, External Training, In Company Training and Foreign Training. Internally, the Bank has STC at Bengaluru and 25 Regional Staff Training Colleges (RSTCs) across the country.
During the year, the Bank has provided training to its employees, covering a wide range of functional areas, including Credit Orientation, Marketing Skills, and Induction Programme for Officers, Agriculture Extension Officers and Specialist Officers. The Bank has designed and implemented several new training programmes, including credit management and decision making skills, credit appraisal programme for Branch Managers and workshop on recovery aspects for Executives.
Under a novel programme, viz., Talent Bank Scheme, a talent pool was formulated, comprising Officers from Scale I to Scale IV, who are willing to take up challenging assignments in the identified critical or specialized areas. 1096 Officials have been selected under the Scheme.
Intensive Credit Management Programme is being conducted in 2 phases. This is an in-depth and exhaustive programme on credit matters evolved by Staff Training College, for Officers in Scale I - III, to build specialization in credit. Intensive Training Programme on Credit over the years has built a talent pool of over 1000 Officers.
Further, the Bankâs quest to enhance the competencies of the workforce continued through focused and need based training at various institutes of repute, like, IIMs, XLRI-Jamshedpur, IDRBT-Hyderabad, JNIBF Hyderabad, NIBM-Pune, SIBSTC-Bangalore, CAFRAL and CAB (RBI)-Pune etc. Customized programmes are also organized to develop expertise in certain niche areas, like, Credit, Risk Management, Treasury Operations, HR, forex and IT.
Specialized trainings to the Senior Management Level and Top Management Level Executives were conducted based on the requirement. The Bank has been able to add substantially to the skill level of its Officials through training intervention and motivating them to perform with renewed vigour and enthusiasm. A governing body for the training setup, headed by the Managing Director & CEO has been established to monitor and streamline the training policies of the Bank.
A scheme for Training as Incentive to Top Performers has been formulated, and was incorporated as a part of Banks Training Policy whereby, top performing officers are sent for training at External institutes of repute and also for training programmes abroad.
Changes brought about in the organizational set up during 2017-18:
The bank follows four-tier structure with 21 circle Offices and 118 Regional Offices as controling and monitoring offices between the Head Office and Branches.
Earlier, the Bank had launched âProject Shikharâ aimed at rejuvenating the Bank by focusing on various themes, like, better branch layout & customer service for customer delight, quality service delivery & reduction in service time, focus on digital banking by promoting transactions on self service machines and alternate channels, inculcating sales culture and focus on business, particularly CASA and fee income growth. In the journey of transformation of branches, number of âShikhar Branchesâ rose to 1548, with 264 branches under star 5 and 89 under star 4 categories as at March 2018.
Marketing and Publicity:
The Marketing Vertical has played a significant role in improving the CASA share, retail business, fee income from the Associate Parties business, wallet maximization and propagating the multifarious technological products and services for the benefit of the customers.
The Bank further strengthened marketing vertical during the year by inducting specialized personnel into the setup, with the support of Marketing Sections in all Circle Offices, overseen by the dedicated Marketing Executives and lead management system. Marketing set up has taken initiatives in cross selling and up selling of Bankâs products by launching several campaigns during the year. The Marketing Team actively organized and participated in various activities such as âFinancial Exposâ, âCASA Campaignsâ, âRetail Exposâ, âHelp Our Customer Dayâ, âHealth Campsâ, âInsurance Daysâ, âNFO Campaignsâ etc. throughout the year to improve visibility of the Bank, extend reach, serve customers and enhance business.
The Marketing Wing organized Marketing Conclaves to direct, encourage & motivate the Marketing Setup during the year 2017-18.
In order to encourage and motivate all the Staff of the Bank to participate in sourcing & recording of business leads for the Bank, the Marketing Vertical launched a Lead Management System âiLeadâ.
The Bank has a healthy following on Social Media platforms Twitter and Youtube. Canara Bank was the First PSU Bank to start an active Twitter Handle in India and the Bankâs handle @canarabanktweet is currently ranked 4th amongst PSBs. It has evolved as a service delivery & grievance redressal channel for customers/ non-customers. Canara Bank official YouTube channel /canarabankofficial was launched during FY 2017-18 and within a short span of 9 months became the No. 1 amongst PSU Banks.
Customer Orientation:
Several initiatives were taken to remain customer focused through providing fast service, bringing in diversified products & services, responding to customersâ queries and redressal of customer complaints. The âCode of Commitment to Customersâ issued by Banking Codes and Standards Board of India (BCSBI) and âRevised Citizenâs Charterâ of Indian Banks Association (IBA) are made available in the Bankâs homepage of the website <www.canarabank.com>. As per the instructions of IBA and RBI, the Bank has adopted Customer Rights Policy as advised by the RBI since July 2015, which spells out the Rights of the Customers and also responsibilities of the Banker. To assess the quality of customer service rendered by the branches and to get the feedback, Grievance Redressal - At Canara Bank we love to listen and a âCustomer Satisfaction Survey Formâmade available in the Bankâs homepage of its website. As per the Damodaran Committee recommendations, the Bank has appointed a Chief Customer Service Officer (CCSO), who acts as an Internal Ombudsman of the Bank. Customersâ fortnight was conducted from 16.11.2017 to 30.11.2017, inviting suggestions from customers.
In order to enhance customer focus, âProject Shikhar -Branch Transformationâ is being implemented since April 2014 where in various customer centric initiatives like Welcome Desk, Queue Management System (QMS), Single Window Operation and allocation of larger space for âCustomer Waiting Areaâ etc., along with self-service kiosks (Can express area) are put in place. In order to enhance customer convenience / experience, Bank has popularized Missed Call Facility through Canara Swipe, BHIM-Empower, Internet and Mobile Banking, Canara e-info book, Canara mServe, Canara Geo locate and Canara Easy Cash facilities. Besides, Call Center with single point contact Toll free number 18004250018 is functioning to cater to customers in 6 regional languages, viz., Kannada, Malayalam, Marathi, Tamil, Oriya and Telugu, besides Hindi and English for redressal of grievances.
The Bank has implemented online grievance redressal facility of customers in the website for lodging grievances online under the portal Canara Public Grievance Redressal System (CPGRS). The complaints received at the Call Centre of the Bank were also integrated with the CPGRS package. During the year, the Call Centre registered 8537 grievances in CPGRS and all grievances were redressed as per prescribed time norms. Centralized Pension Processing Cell has been established exclusively for handling pensions and resolving pension related grievances. 41 Central Processing Centers are established at selected places for account opening purposes.
The Bank has framed a policy on Customer Protection for limiting liability of customers in unauthorised Electronic Banking Transactions (EBT) in tune with the RBI guidelines. Recognising the fact that customer protection and financial Inclusion are the two crucial pillars of financial stability and considering the recent surge in customer grievances relating to unauthorised Electronic Banking Transactions (EBT) resulting in erroneous debits to customer accounts/cards, customers are required to report to Bank immediately on knowing the occurrence of the unauthorized EBT. Further, the branches have the obligation to educate the customers to protect themselves from electronic banking and payments related frauds through various channels.
During the year, training sessions for customer awareness meeting were conducted at Mumbai and Chennai in association with Banking Codes and Standards Board of India (BCSBI).
Systems and Procedures:
Risk based Internal Audit (RBIA) was conducted in 4852 branches / units programmed for onsite RBIA during the year. Information Security audit was conducted along with RBIA. Concurrent/continuous audit was conducted in 1100 branches/service units, of which 300 branches / units were subjected to concurrent/continuous audit by Internal Auditors and 800 branches / service units were subjected to concurrent audit by External Auditors, covering 70% of the total business of the Bank. 2208 branches were subjected to income/revenue audit, which included branches identified for income audit on quarterly basis.
As part of strengthening the audit process, Branches/ Units were graded under Four scales - LOW / NORMAL / MODERATE & HIGH in RBIA with effect from 1st April 2017 against the earlier 3 scales ie, LOW / MEDIUM / HIGH
The Bank has already implemented computerized audit through Web Based Audit Package called, âDARPANâ, for RBIA of branches. The scope of such DARPAN is extended for Concurrent Audit, RO Audit, Circle Audit, IS Audit, KYC Audit etc., during the year. In case of branches which were witness to frauds, suitable provisions have been made in RBIA to re-rate the risk gradation and reducing their rating to either âHighâ or âa notch Lowerâ (higher risk grade).
During the year, Bankâs Inspection Wing has undertaken the Audit of SWIFT messages pertaining to LoUs/LoCs in all the designated branches and found them satisfactory. Bank is now focusing on rationalization of audit process and mandays in pursuit of further toughening of the risk based audit process.
Risk Based Supervision:
The Bank is brought under Risk Based Supervision (RBS) regime by RBI, in lieu of Annual Financial Inspection (AFI) from FY2014-15. Presently, the Bank has completed the 4th cycle of RBS. RBS framework is named as Supervisory Programme for Assessment of Risk and Capital (SPARC). Under SPARC, a detailed qualitative and quantitative assessment of the Bankâs risks is made by the RBI on an on-going basis through a combination of offsite and onsite Risk Discovery Process (RDY).
Know Your Customers (KYC)/AML/CFT:
The Bank undertook various measures for the effective implementation of guidelines on Know Your Customer (KYC), Anti Money Laundering (AML) and Combating Financing of Terrorism (CFT).
Some of the major achievements and initiatives taken were as under:
- AML/CFT centralized unit is exclusively processing and monitoring of AML/SDN (Specially Designated Nationals) alerts.
- System checks/enhancements are put in place to ensure compliance to guidelines on KYC/AML/CFT.
- System checks and enhancements implemented for Trade Based Money Laundering (TBML) alerts.
- Circle MLROs have been entrusted to audit 10% of alerts dropped by Circle AMLOs and escalate suspicious transactions to HO.
- HO case managers entrusted to audit 10% of remaining 90% of alerts dropped by Circles.
- Two AML/CFT/KYC sensitization programmes were conducted on 17.11.2017 at Bengaluru and on 04.12.2017 at Gurugram
- Branch/Circle/Regional Office staff members were sensitized by way of issuance of guidelines and periodical training.
- Unit has attended SBN related queries from RBI (SBN facility extended to NRIs/people outside during demonetization period
- AML/CFT Centralized unit has filed 3960 Suspicious Transaction Reports (STRs) during 2017-18 out of which 1406 STRs on account of Shell Companies.
- New AML in-house Package has been developed in co ordination with DIT New Products Group. UAT is completed on 01.02.2018 and package is under parallel run with old package.
- KYC Cell has been designated as one point contact for RBI, Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) etc for all KYC matters.
- KYC Cell has registered with CERSAI / Central KYC reporting.
- CKYC Project was implemented on 30.10.2017 on a pilot basis and all branches across the Country brought under CKYC by 27.11.2017.
- 11,45,499 KYC IDs have been issued to our Customers since 30.10.2017 out of 19,20,767 Accounts opened.
Vigilance Setup:
The Vigilance Wing of the Bank is headed by a Chief Vigilance Officer (CVO). The CVO is assisted by the Vigilance Officers stationed at Head Office, all Circle Offices, RRBs and subsidiaries of the Bank. The objectives of the Vigilance Wing are to ensure that discipline and development, go in tandem and help the Bank to reach greater heights. With an objective to ensure free, fair and healthy environment for all-round growth of the organization, the Vigilance Management in the Bank comprised preventive, participative and punitive functions. These goals are pursued and promoted through various means and channels.
As a part of the Vigilance Awareness campaign, the Bank has observed âVigilance Awareness Weekâ from 30th October 2017 to 4th November 2017 as per the directives of Central Vigilance Commission. Various programmes were conducted throughout the country with the support of Circle offices and branches to spread awareness regarding observance of Vigilance Week and its importance. Programmes, like, debates, impromptu speeches and quizzes were organized at 89 schools and colleges highlighting the theme âMy Vision - Corruption Free Indiaâ across the country.
On this occasion, a talk on the theme was organized on 4th November 2017 during the valedictory function held at Head Office of the Bank at Bangalore. Honâble Mr. Justice N Kumar, Former Judge, High Court of Karnataka was the Chief Guest and he addressed staff & executives of the Bank at Head Office. During the function, the in-house quarterly Magazine of the
Vigilance Wing, âCanara Vigilâ (July-September 2017), was released by the dignitaries and prizes were distributed to the winners of Quiz Competition.
During the year, Vigilance Wing has conducted Workshops for Investigating Officers, Presenting Officers, Inquiring Authorities & Disciplinary Authorities on 15.09.2017, 21.09.2017 to 22.09.2017, 09.02.2018 & 16.02.2018 at Head Office, RSTC Gurgaon & Patna respectively. Officials from Central Vigilance Commission and RBI have participated in the Workshop and addressed the participants.
Security Arrangements:
Out of 6204 branches, and 105 currency chests in 21 Circles / 118 regional offices, the Branch security profile is as follows: High Risk Branches - 45, Normal Risk Branches :1678 and Low Risk Branches: 4481. These Branches & Currency Chests were periodically visited by Security Officers as per statutory guidelines. All the sensitive currency chests were visited by the Chief Security Officer during the year.
The following measures were initiated based on the instruction from RBI, IBA & State Police Authorities:
a) All branches, Currency Chests & ATMs have been provided with CCTV cameras & DVR.
b) 977 ATMs (Pan India) and 9 mobile ATMs have been provided with private security guards based on the threat perception and directions from police authority.
c) Notwithstanding that security personnel are âconstantly committedâ to security duties, the bank is geared up to meet all the challenges.
The security set up is regularly upgrading the security apparatus and issuing suitable instructions, advisories and guidelines to all branches from time to time, including focusing on fire safety measures and minimising damages.
Right to Information:
Under the Right to Information Act, 2005, an exclusive Right to Information Act outfit is functioning to provide information and bring transparency. During June 2016, Department of Personnel Training, Ministry of Finance, Government of India has come out with a web based online RTI portal to enable the citizens to make online applications/appeals. This web based package has been given to the Public Sector Banks with effect from 20th July 2016. To comply with the RTI guidelines and to cater to the needs, the Bank has nominated a Nodal Officer at Head Office and a Central Public Information Officer (CPIO) and a First Appellate Authority (FAA) for all Regional Offices, Circle Offices and Head Office. Apart from this, the Bank has designated all the branch / unit heads as Assistant Public Information Officer (APIOs) to receive and forward the RTI applications, 1st appeal and to forward the same to the concerned CPIOs and also to assist the CPIOs whenever requested. Presently, there are 140 PIOs and 140 Appellate Authorities. During the year 2017-18, the Bank received 3634 RTI applications, 871 Appeals & 9 Second appeals as against 3918 RTI applications, 905 First Appeals and 37 Second Appeals during the previous year, as per the provisions of RTI Act, 2005.
Implementation of Indian Accounting Standards:
As per RBI guidelines, the Bank is in the process of implementing the Indian Accounting Standards (Ind AS). A Project Steering Committee and an International Financial Reporting Standards (IFRS) Cell have been formed to take the required steps on a continuous basis for smooth convergence. The Bank has appointed M/s. Deloitte Haskins & Sells LLP as the consultant for assisting the Bank in smooth implementation of Indian Accounting Standards. The pro-forma financial Statements for the half year ended 30.09.2016 and Quarter ended 30.06.2017 has been submitted to RBI within the due prescribed date. RBI has deffered its implementation by one year.
Implementation of Official Language:
The Bank made noteworthy progress under the implementation of official language and won many prizes at various levels during the year under review.
As at March 2018, around 98% of employees have obtained working knowledge in Hindi and the Bank has notified 3501 Branches under Rule 10(4) of OL Rules 1976. All the employees of the Bank possessing working knowledge of Hindi have been trained in functional Hindi through Hindi workshops. During the year under review, Bank has conducted 263 refresher training programmes for such employees.
In the sphere of using Information Technology in the Official Language, the Bank has furthered the use of Unicode package for word processing and also made provision in ATM screens of the Bank for carrying transaction in 10 Indian languages. Apart from Hindi and English, transaction slips can be obtained in Malayalam, Tamil, Telugu, Kannada, Punjabi and Marathi from our ATMs (Transactions done in concerned language). Tele banking facility has also been provided in Hindi and English and other 6 major regional languages. The Bankâs corporate website is bilingual. The Bank is also giving SMSs in Hindi to all its customers on special occasions.
Bank has provided Hindi option in Core Banking System. Our Bankâs bilingual address booklet CANPATHA is made available to all our branches and offices in electronic form. Hindi option is provided in Mobile Banking, E-Infobook and the Bankâs internet Banking portal.
To encourage effective implementation of Official Language in the Bank, 385 prizes were given to Circles, Regional offices, Branches, RSTCs and Sections of Head Office & Circle Offices under the award Scheme formulated by the Bank, viz., Canara Bank Rajbhasha Akshay Yojana and 90 employees were awarded under Rajbhasha Puraskar Yojana. Bank has also conducted Annual âAll India Hindi Essay Competitionâ for its employees and cash prizes were given to prize winners.
Half Yearly Hindi journal âCanarajyotiâ - 18th & 19th issues were brought out during the year. The 19th issue was released by our MD&CEO Sri Rakesh Sharma during Hindi Day Celebration 2017 at Head Office, Bangalore & 18th issue was released by Prof. V R Jagannathan, Linguistic Expert & Rtd. Professor, IGNOU. Canarajyoti was brought out to encourage original writing in Hindi. This publication contains articles on banking related subjects as well as Poetry, Short Stories, Travelogues written in Hindi by employees of our Bank. During the year, Canarajyoti awarded Silver Prize by ABCI under Indian Language category.
The 35th All India Conference of OL Officers of the Bank was held at RSTC, Gurgaon on 22nd and 23rd Feb 2018.
During the year, theThird Sub Committee ofParliamentary Committee on Official Languages had inspected our Banikhet Branch (Chandigarh CO) and Tirupati Regional Office. The committee lauded the efforts put in by the Bank in the field of Official Language implementation. The Bank is convening the Town Official Language Implementation Committees of Agra, Coimbatore and Thiruvananthapuram. Official Language Implementation Committees are constituted in all the branches of the Bank as per the Govt. guidelines to propagate the progressive use of Hindi.
Promotion of Sports:
Canara Bank has always been encouraging and supporting sports and has contributed generously to sporting activities all over the country by sponsoring tournaments, providing scholarships to talented sports personalities. A Sports Council at Head Office was setup in the year 1982 to monitor and encourage sports activities in the Bank.
The Bank is presently having teams in 6 disciplines.
Athletics |
Women |
4 Members |
Ball Badminton |
Men |
3 Members |
Cricket |
Men |
16 Members |
Hockey |
Men |
13 Members |
Shuttle Badminton |
Men |
2 Members |
Table Tennis |
Men & Women |
3 Members |
International Sportspersons in the Bank fold are Shri B K Venkatesh Prasad & Shri Sunil B Joshi (Cricket), Smt M K Asha, Smt Suma Gopalakrishna (Athletics), & Smt H M Jyothi (Present International Athlete), Shri P Shanmugam, Shri Bharath Kumar Chhetri (Captain Indian Hockey Team, London Olympics-2012) & Shri K M Somanna (Senior-Hockey), Shri K P Dinesh (Junior-Hockey), Shri D Guruprasad, Shri Vineet Manual (Shuttle Badminton). Some of the above sportspersons still don the Bank colours while representing the Bank in tournaments/competitions at the State/National level.
The Bankâs Hockey Team was Runners up in the 8th Hockey India Senior National B Division Championships at Imphal, Manipur during Jan 2018, and also in the Field Marshal Cariappa Memorial Hockey Tournament at Bangalore. The Cricket Team of the Bank was the Winners in the following championships: (1) The Karnataka State Group II Division, (2) I League Championships, and (3) 25th International Pradip Memorial Tournament at Odisha. Further the team was runners up in the All India Pooja Cricket Tournament at Cochin.
Apart from the teams at the Head Office, the Bank is also encouraging sports at the Circle levels by allotting annual budget for sports activities and also by organising sports competition for employees which are duly monitored by the Circle Sports Councils.
FINANCIAL SUPERMARKET
Canara Bank, with an objective of offering âOne Stop Bankingâ facilities for the customers, forayed into diversified business activities by opening subsidiaries during late 1980s. Today, the Bank functions as a âFinancial Supermarketâ, with ten Subsidiaries/Sponsored entities/ Joint Ventures in diversified fields. All the Subsidiaries/ Sponsored entities/ Joint Ventures of the Bank recorded satisfactory performance during the year 2017-18.
CANFIN HOMES LIMITED (CFHL):
M/s Canfin Homes Limited, a sponsored entity of Canara Bank is one of the premier housing finance entities in the country. The bank holds 30% stake with the company. The loans outstanding of the Company as at March 2018 was Rs.15743 crore. The Company earned a profit after tax of Rs.301.77 crore as against Rs.235.26 crore in the previous year, with y.o.y growth of 28.27%. Gross NPAs of the Company was Rs.67.49 crore and Net NPA was Rs.31.62 crore as on 31.03.2018. 100% dividend for the year 2017-18 has been proposed by the Company.
CANARA BANK SECURITIES LIMITED (CBSL):
M/s Canara Bank Securities Limited is a wholly owned subsidiary of the Bank. The Company offers stock broking services to both institutional and retail clients. Online Trading Counter for retail customers is its flagship product and has diversified into Currency Derivatives and has a clientele base of 46,876. The Company has posted a profit after tax of Rs.9.54 crore and declared a dividend of 15% for the year 2017-18. CBSL has taken over the Depository Participant operations from Canara Bank with effect from 01.04.2017.
CANARA ROBECO ASSET MANAGEMENT CO LIMITED (CRAMC):
M/s Canara Robeco Asset Management Company Limited is a joint venture (JV) with M/s Robeco Groep N V with the bank holding 51% Stake. This JV was formed in 2007 divesting 49% Stake held by the bank in M/s Can Bank Mutual Fund in favour of M/s Robeco Groep N V. Total Assets under Management (AUM) was at Rs.12532 crore with investor base of 8.31 lakhs as at March 2018. The Company is currently managing 29 Mutual Fund Schemes, including Gold Exchange Traded Fund. The Company has posted a net profit of Rs.22.70 crore and declared a dividend of 10% for the year 2017-18.
CANBANK FACTORS LIMITED (CFL):
M/s Canbank Factors Limited is a factoring Subsidiary of the Bank with 70% stake held by the Bank. During 2017-18, the Company had a total business turnover of Rs.1640 crore. The Company incurred a loss of Rs.50.66 crore due to making provisions amounting to Rs.65.25 crore for the doubtful debts for the year 2017-18.
CANARA HSBC ORIENTAL BANK OF COMMERCE LIFE INSURANCE COMPANY LIMITED (CHIOCe):
M/s Canara HSBC Oriental Bank Of Commerce Life Insurance Company Ltd (CHIOCe) is a Life Insurance Joint Venture floated by the Bank in association with HSBC Insurance (Asia Pacific) Holding Limited and Oriental Bank of Commerce in the year 2007. The JV commenced its business operations with effect from 16.06.2008, with majority shareholding of 51% by Canara Bank, followed by HSBC (26%) and Oriental Bank of Commerce (23%). The Company recorded new business premium of Rs.1184 crore and gross premium of Rs.2781 crore during the year. The Company has 2,30,590 in-force policies as on 31.03.2018. The Company achieved a statutory profit of Rs.168 crore for 2017-18.
CANBANK VENTURE CAPITAL FUND LIMITED (CVCFL):
M/s Canbank Venture Capital Fund Limited is the Trustee and Manager of Canbank Venture Capital Fund and a wholly Owned Subsidiary of the Bank. The company has managed 5 funds so far with total Asset under Management of Rs.552.78 crore. The latest fund is the Emerging India Growth Fund with a corpus of Rs.435.86 crore. CVCFL has been appointed by the Department of Electronics and Information Technology (DeitY) to manage the Electronic Development Fund (EDF) with a corpus of Rs.2206 crore, with Rs.2200 crore from Government of India, Rs.5 crore from Canara Bank and Rs.1 crore from CVCFL. Another new fund named as âEmpower India Fundâ is being setup with a target corpus of Rs.650 crore. The Company recorded a profit after tax of Rs.4.93 crore and has proposed to pay a dividend of 1000% for the year 2017-18.
CANBANK COMPUTER SERVICES LIMITED (CCSL):
M/s Canbank Computer Services Limited is the only Software Company promoted by a Public Sector Bank in the country, with a 69.14% shareholding by the Bank. CCSL is primarily engaged in IT and Software development services, BPO services, ATM / Any Time Payment services, Training, Consultancy and R&T agent. The Company has posted a profit after tax of Rs.4.02 crore and proposed a 30% dividend for 2017-18.
CANBANK FINANCIAL SERVICES LIMITED (CANFINA):
M/s Canbank Financial Services Limited is confining its activities to legal matter arising out of past transactions in securities and recovery of dues under decreed accounts. The Company received extension of time limit from the RBI for further period of three more years up to 31.01.2020 for disposing off its assets.
COMMERCIAL INDO BANK LLC (CIBL):
M/s Commercial Indo Bank LLC, a joint venture of Canara Bank and State Bank of India has been operational since April 2014 in Moscow, Russia. The company incurred net loss after tax of US$ 5.42 million during the year.
CANARA BANK (TANZANIA) LIMITED:
M/s Canara Bank (Tanzania) Limited is wholly owned Subsidiary of the Bank at Dar es Salaam in Tanzania, registered in Tanzania on 02.11.2015 and obtained a banking license from the Bank of Tanzania on 05.05.2016. The subsidiary commenced its business operations from 09.05.2016. The company earned a profit after tax of $0.26 million.
REGIONAL RURAL BANKS (RRBS)
As at March 2018, the Bank had two sponsored RRBs, viz., Kerala Gramin Bank (KGB) in Kerala and Pragathi Krishna Gramin Bank (PKGB) in Karnataka.
Kerala Gramin Bank (KGB) operates in all the 14 districts of Kerala State with 630 branches and 322 ATMs. The total business of the KGB was Rs.29648 crore as at March 2018, comprising a total Deposits of Rs.15338 crore and Advances of Rs.14310 crore. Pragathi Krishna Gramin Bank (PKGB) operates in 11 districts of Eastern Karnataka with 655 branches & 279 ATMs. The total business of the PKGB was Rs.29228 crores as at March 2018 with total Deposits of Rs.16147 crore and Advances of Rs.13081 crore.
Aggregate business of both the RRBs increased to Rs.58876 crore as at March 2018 with a y.o.y growth of 4.06% comprising Deposits of Rs.31485 crore and Advances Rs.27391 crore. Through the Bankâs infrastructure support, the RRBs are extending facilities, like, ATM cum Debit Card services and installed 601 ATMs/Cash Dispensers (322 by KGB, 279 by PKGB) as at March 2018. The sponsored RRBs are 100% CBS compliant and are ahead of their peer RRBs under technology front by extending IT based products, like Mobile Banking, RuPay Debit Card services and also Aadhaar enabled services and remittance facilities through NEFT/RTGS to their customers. The RRBs have put in place Cheque truncation system and e-KYC technology.
Kerala Gramin Bank had received Banking Excellence Award-2017 for contribution towards rural development of Kerala by State Forum of Bankers Club Kerala (SFBCK). KGB has been adjudged as the overall best social bank during Assocham Indiaâs Social Banking Excellence award 2017. KGB has been adjudged as the second best performing bank in Kerala for the efforts taken in promoting the CLSS under PMAY (Urban). KGBâs case study on âFIGITAL INCLUSIONâappeared on âGOVERNANCE NOWâsâ INDIA FINANCIAL INCLUSION CASE BOOK. The case study was about KGBâs Vattavada Branch in Idukki. KGB has coined a new term âFIGITAL INCLUSIONâ which stands for Financial Cum Digital Inclusion.
Pragathi Krishna Gramin Bank has been conferred two First Prizes from NABARD for outstanding performance under SHG and JLG Linkage for the years 2016-17, ASSOCHAM Social Banking Award-Winner Among RRBs and Co-operative Banks in the country under Priority Sector Lending to categories other than Agriculture and Runner - Agriculture Banking, SKOCH Order of Merit for Financial inclusion through Insurance, SKOCH Inclusive Insurance Gold Award for Financial Inclusion through Insurance, National Award from Ministry of Rural Development, Government of India under National Rural Livelihood Mission for Best Performance in SHG Linkage for 2017-18 among RRBs (Southern Region) , Secured âAâ Grade in NABARD Audit during the year, Bank secured âAbove Averageâ rating with a total score of 81 and 2nd highest ranking in the BCSBI Survey of RRBs.
The Bankâs sponsored RRBs were the first amongst RRBs to implement e-KYC technology and Aadhaar Enabled Payment System (AEPS). Together, these RRBs had done 11.10 lakh enrolments under the Social Security Schemes.
HIGHER EDUCATION FINANCING AGENCY [HEFA]:
Higher Education Financing Agency (HEFA), a not-for-profit organisation, is set up by the bank under a joint venture share holder agreement with the Ministry of Human Resource Development (MHRD), Government of India. This agency was set up to leverage funds from the market and supplement them with donations and CSR funds to finance improvement of infrastructure in Indiaâs Premier Higher education institutions viz., IIT, IIIT, IISER, etc to make them world class. HEFA is set up for developing the educational infrastructure, particularly R&D infrastructure thereby enabling the institutions to reach top rankings globally. This agency has an initial authorized capital of Rs.2000 Crore which is proposed to be contributed in the ratio of Rs.1000 Crore by MHRD, Rs.100 Crore by Canara Bank and Rs.900 Cr. from other Corporates. The paid up equity of HEFA as on date is Rs.300 Crore of which Rs.250 Crore by MHRD and Rs.50 Crore by Canara bank.
HEFAhas so far approved projects to the tune ofRs.2,015Crore for 7 institutions of which Rs.85 Crore has been disbursed. HEFA also has proposals to the tune of Rs.9818 Crore from 16 institutions and the appraisal process is underway.
AWARDS / ACCOLADES
In recognition ofthe varied initiatives, the Bank was conferred with the following awards during the year 2017-18:
- Received Master card Innovation Award for Canara International Prepaid card under prepaid segment.
- âRupay Specialâ award for being the highest Rupay card issuing bank by NPCI.
- VISA Award on crossing a key milestone on issuance of 1.35 crore VISA debit card.
- Bagged FINNOVITI award for Innovation for CANDI Branch.
- ASSOCHAM Social Banking Excellence Awards 2017 for Government Sponsored Schemes and Runner-up for Agriculture Banking in the Large Bank Class.
- Golden Peacock Award 2017 for Corporate Social Responsibility from Institute of Directors, New Delhi.
- Skoch Technologies Growth 2017 for âCANDIâ, digital branch.
- âExcellent Customer Service Awardâ at the 5th SME Excellence 2017 by ASSOCHAM.
- âBest CIO of the Yearâ by Computer Society of India for âCANDIâ an ambitious digital banking project of the Bank in the âIT Innovation & Excellence Awards2017â
- Skoch Smart Security awards 2017 for âSIEMâ tool.
- Dun and Bradstreet Award for 2016-17 adjudging as Best Public Sector Bank -Priority Sector Lending Bank. Consecutively third time (2014-15, 2015-16 and 2016-17) Bank has been receiving this Award.
- Certificate of Excellence for exemplary leadership in promoting RSETIs and Certificate of Excellence for RUDSETI for FY15 & FY16.
- Best Strategy in HR & Training Excellence - Platinum awards in 7th Annual Greentech - HR Award-2017.
- Gold Award for in-house Magazine, âShreyasâ, Special Column (English) Silver for Photography and features (Hindi) by the Association of Business Communications of India 2017.
- Excellence in Branding & Marketing award for in-house Magazine.
VARIOUS POLICIES OF THE BANK
There is a system of implementing well-defined policies and procedures in the Bank. During the year, concerted efforts were made to streamline the policies and procedures of the Bank in the light of regulatory requirements of the RBI, the directions of the Government of India and the emergent requirements of the Bank in the present day context. Accordingly, there has been a sharper focus on policies relating to, among others, Credit Risk Management, Market Risk Management, Operational Risk Management, Asset Liability Management, Liquidity Risk Management, Group Risk Management, Country Risk, Counterparty Bank Risk, Corporate Governance, Disclosures, Collateral Management, Stress Testing, Compliance Functions, Disaster Recovery and Business Continuity Planning, Business Lines, Outsourcing and ICAAP, KYC, AML, Recovery and Investments.
CHANGES IN THE BOARD OF DIRECTORS
Year 2017-18 saw the following changes in the composition of the Board of Directors of the Bank. Changes in the Bankâs Board of Directors during the year 2017-18
Name of the Director |
Designation |
Date of Appointment |
Date of Cessation |
Shri Harideesh Kumar B |
Executive Director |
11.03.2015 |
31.05.2017 |
Shri Dinabandhu Mohapatra |
Executive Director |
22.01.2016 |
05.05.2017 |
Shri Mahadev Nagendra Rao |
Shareholder Director |
27.07.2016 |
01.03.2018 |
Shri Matam Venkata Rao |
Executive Director |
09.10.2017 |
Tenure on the Board ending on 08.10.2020 |
Smt. Debashish Mukherjee |
Executive Director |
19.02.2018 |
Tenure on the Board ending on 18.02.2021 |
Brief Profile of the newly appointed Directors of the Board of the Bank during 2017-18
1. Shri Matam Venkata Rao is a Post Graduate in Agriculture from Sri Venkateshwara Agriculture College, Tirupati, A.P. He joined Allahabad Bank as Agricultural Field Officer (AFO) in 1988 and has worked in various capacities and in different geographical areas of the country. As General Manager of Allahabad Bank, he has headed Bankâs Verticals like Corporate Credit, Debt Restructuring and Retail Banking. He was instrumental in launching a transformative project in Allahabad Bank to bring focus on Asset centric banking. He is a Certified Associate of Indian Institute of Bankers.
Mr. M V Rao has taken charge as Executive Director of the Bank on 9th October, 2017.
2. Mr. Debashish Mukherjee, new Executive Director of our Bank, is an MBA in Finance from the University of Kolkata. He started his banking career with Punjab National Bank as a Financial Analyst in Scale II in 1994.
He joined United Bank of India as an Assistant General Manager (Credit) in the year 2006. He worked in various capacities at Regional Offices, headed Corporate Finance Branch at Kolkata and was Regional Manager of Bihar Region. He got elevated as General Manager in 2012. He has vast experience in Corporate Credit and worked as GM (Credit) for more than 5 years. He worked as GM (Recovery & Credit Monitoring) thereafter. He is an avid reader and has travelled extensively.
Mr. Debashish Mukherjee, has taken charge as Executive Director of the Bank on 19th February 2018.
DIRECTORSâ RESPONSIBILITY STATEMENT
The Directors, in preparation of the annual accounts for the year ended March 31, 2018, confirm the following:
- That in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.
- That they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit or loss of the Bank for the period.
- That they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of applicable laws governing banks in India for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities.
- That they had prepared the annual accounts on a going concern basis.
ACKNOWLEDGEMENT
The Board wishes to place on record its sincere appreciation to the customers for their patronage, to the shareholders for their support, to the Government authorities and the Reserve Bank of India for their valuable guidance and support, to the Directors who completed their tenure during the financial year under review, to the Bankâs Correspondents in India and abroad for their co-operation and goodwill and to all the Staff Members for their full support in the pursuit of organizational growth and excellence.
RAKESH SHARMA
MANAGING DIRECTOR & CEO
Mar 31, 2017
DIRECTORSâ REPORT: 2016-17
The Board of Directors have pleasure in presenting the 48th Annual Report together with the Balance Sheet as on 31st March, 2017 and Profit & Loss Account for the financial year ended March 31, 2017.
MANAGEMENT DISCUSSION AND ANALYSIS
I. Economic Environment
Indian economy continues to remain as an economic bright spot, despite some growth moderation during 2016-17. As per the provisional estimates released by the Central Statistical Organization (CSO), India''s Gross Domestic Product (GDP) grew by 7.1% y-o-y in 2016-17 compared to 8.0% in the previous year (under the new base year 2011-12). Agriculture and allied activities grew by 4.9% during the year compared to a growth of 0.7% in last year. Mining & quarrying sector grew by 1.8% against a growth of 10.5% last year. Manufacturing sector grew by 7.9% compared to a growth of 10.8% last year. Electricity, gas, water supply and other utility services sector grew by 7.2% compared to 5.0% last year. Construction sector grew by 1.7% compared to 5.0% last year. Trade, Hotels, Transport, communication & services related to broadcasting sector grew lower by 7.8% compared to 10.5% growth in the previous year. Financial, insurance, real estate & professional services sector grew by 5.7% compared to 10.8% last year. Public administration, defense & other services sector grew higher by 11.3% compared to 6.9% in the last year.
The inflation rate remained well under control and remained within the Reserve Bank of India (RBI) comfort level. The retail inflation rate measured by Consumer Price Index (CPI) came down to 3.89% in March 2017 compared to 4.83% in March 2016. However, Wholesale Price Index (WPI) rose to 5.29% in March 2017 against a decline of 1.09% in March 2016. The divergence between WPI and CPI is expected to narrow under new base year series 2011-12.
Both exports and imports have picked up later during second half of the financial year 2016-17 as against a decline in the previous year. As per the provisional data released by the Directorate General of Commercial Intelligence and Statistics (DGCI&S), total exports rose to US $274.65 billion compared to US $262.29 billion in the last year. Total imports stood at $380.37 billion against US $381.01 billion in the previous year. Trade gap, during the year, was lower at US $105.72 billion compared to US $118.72 billion last year. The pickup in exports was fuelled by rise in global orders for engineering goods, ready-made garments and petroleum products. Current Account Deficit (CAD) stood at 0.7% of GDP from 1.1% GDP in the last year.
Economic Environment in Karnataka
As per the Economic Survey of Karnataka, the Gross State Domestic Product (GSDP) grew lower by 6.9% during 2016-17 compared to 7.3% in the last year, in line with the national economy. Nevertheless, as an economically developed State in India, Karnataka contributes 7% to the country''s GDP.
Canara Bank, owing its origin to the State, is continuing its key position in the State. The Bank has been playing a leading role in the State through its 984 branches and 2,483 ATMs, spread across the State. The State contributes about 19.5% to total domestic business of the Bank. The total business of the Bank in the State stood at Rs,15,0401 crore, comprising Rs,90,949 crore under deposits and Rs,59,452 crore under advances as at March 2017, with a credit to deposit (C-D) ratio of 65.37%.
II. MONETARY AND BANKING DEVELOPMENTS
Growth in key monetary aggregates and money supply in 2016-17 reflected the changing liquidity conditions arising from domestic and global financial environment. The monetary policy stance during the year was primarily to contain inflation and manage liquidity.
Money supply (M3) growth, which was 10% at the beginning of the financial year, moderated to 7.3% by end-March 2017 due to demonetization of the high denomination currencies notes of Rs,1000 and Rs,500 (called specified bank notes- SBNs) in November 2016. Such notes, valued at Rs,15.4 lakh crore constituted 86.9% of the value of total currency in circulation. Money supply has improved since then with the progressive re-monetization by the RBI.
Aggregate deposits of the Scheduled Commercial Banks (SCBs) grew higher at 11.8% y.o.y compared to 9.9% growth in the previous year, backed by huge cash deposits in banks that came post demonetization.
The surge in deposits in the banking sector has created large surplus liquidity conditions post-demonization. On the other side, SCBs'' credit growth came down to a multi-decades low of 5.1% y.o.y against a growth of 11.3% in the last year. Consequently, SCBs'' C-D ratio stood at 72.91% as on March 31, 2017 compared to 77.72% as on March 18, 2016.
Even though there was some moderation in the incremental addition of NPAs, asset quality of the banking sector continued to be under stress during the year, affecting their profits and profitability.
The year 2016-17 saw the following changes in the key policy measures as announced by the RBI.
- Repo rate decreased by 50 basis points (bps) to 6.25% and reverse repo rate stood at 5.75%, the same level as of last year.
- Marginal Standing Facility (MSF) Rate and Bank Rate were aligned 50 bps above the repo rate at 6.75%.
- Cash Reserve Ratio (CRR) was kept unchanged at 4% of Net Demand and Time Liabilities (NDTL) during the year.
- Statutory Liquidity Ratio (SLR) was decreased by 75 basis points to 20.50% during the year.
Changes in Repo Rate and MSF Rate during the year
Effective Since |
Repo Rate (%) |
Reverse Repo rate (%) |
Cash Reserve Ratio (CRR) (%) of NDTL |
Statutory liquidity ratio (SLR) (%) |
MSF Rate (%) |
April 02, 2016 |
6.75 |
5.75 |
4.00 |
21.25 |
7.75 |
April 05, 2016 |
6.50 |
6.00 |
4.00 |
21.25 |
7.00 |
July 09, 2016 |
6.50 |
6.00 |
4.00 |
21.00 |
7.00 |
October 01, 2016 |
6.50 |
6.00 |
4.00 |
20.75 |
7.00 |
October 04, 2016 |
6.25 |
5.75 |
4.00 |
20.75 |
6.75 |
January, 07, 2017 |
6.25 |
5.75 |
4.00 |
20.50 |
6.75 |
RBI made the following major policy announcements / supervisory review / changes during the year.
- As part of the Asset Quality Review (AOR), the deadline for banks to clean up their balance sheets stood at end-March 2017.
- A Monetary Policy Committee (MPC) constituted with the amendment of the RBI Act, 1934 by the Finance Act, 2016 for maintaining price stability, while keeping in mind the objective of growth. The MPC has been given the task of fixing the benchmark policy rate or repo rate required to contain inflation within the specified target level of 4% with upper tolerance level of 6% and lower level of 2%, as notified in the Gazette of India Extraordinary on 6th June 2016.
- Notified the withdrawal of Legal Tender Status for ''500 and ''1000 in line with the Government of India Notification No. 2652 dated November 8, 2016.
- Issued ''500 banknotes with inset letter ''E'' in Mahatma Gandhi (New) Series and ''2000 banknotes with inset letter ''R'', with both bearing the signature of Dr. Urjit R. Patel, Governor, Reserve Bank of India.
- Issued guidelines on ''Scheme for Sustainable Structuring of Stressed Assets''(S4A) in order to further strengthen the lenders'' ability to deal with stressed assets. The Scheme envisages determination of the sustainable debt level for a stressed borrower, and bifurcation of the outstanding debt into sustainable debt and equity/quasi-equity instruments, which are expected to provide upside to the lenders when the borrower turns around.
- In its financial stability report, the RBI, as per the macro stress test, projected the Gross NPA ratio to increase from 9.1% in September 2016 to 9.8% by March 2017 and further to 10.1% by March 2018. If the macroeconomic conditions deteriorate, the GNPA ratio may increase further under such consequential stress scenarios. Iron & Steel, Construction, Power and Engineering are the high risk sectors that contribute to high NPAs for the banking industry.
- Issued guidelines for sale of stressed assets to Non - Banking Financial Companies (NBFCs) and Financial Institutions (FIs) in addition of securitization companies or reconstruction companies.
- Advised banks to set aside more funds against their exposure to sectors that are sitting on piles of debt viz., telecom, iron and steel and power sectors.
- Reviewed the extant guidelines on ownership in private sector banks which envisaged diversified shareholding in private sector banks by a single entity / corporate entity / group of related entities.
- Announced a package of measures for the development of fixed income and currency markets for further market development, enhance participation, facilitate greater market liquidity and improve communication.
- Established an Inter-disciplinary Standing Committee on Cyber Security to, inter alia, review the threats inherent in the existing/emerging technology; study adoption of various security standards/protocols; interface with stakeholders; and suggest appropriate policy interventions to strengthen cyber security and resilience.
- Issued Draft Circular on rationalization of Merchant Discount Rate (MDR) for Debit Card Transactions.
- Made it mandatory for banks to allow customers to register their mobile numbers through any ATM. In addition, banks have also been asked to make available mobile registration through internet banking.
- Set up a panel to decide on what exactly qualifies as a bank branch, a move aimed to provide more flexibility to banks as new technology enables them to extend most services without the trappings of a traditional branch.
- Issued the Master Circular on amalgamation of private sector banks, 2016 comprising of applicability, scope and statutory provisos for the banks to amalgamate.
- Issued draft guidelines on Investment Advisory services offered by banks and as per the draft, banks desirous of offering these services may do so either through a separate subsidiary set up for the purpose or one of the existing subsidiaries after ensuring that there is an arm''s length relationship between the bank and the subsidiary.
- In lines with the Basel III Framework on Liquidity Standards, Liquidity Coverage Ratio (LCR), Liquidity Risk Monitoring Tools and LCR Disclosure Standards, banks were permitted to reckon government securities held by them up to another 1% of their NDTL under FALLCR within the mandatory SLR requirement as level 1 HQLA for the purpose of computing their LCR. The total carve-out from SLR available to banks would be 11% of their NDTL.
- As part of the Framework for Revitalizing Distressed Assets in the Economy, RBI amended certain guidelines relating to sale of non-performing assets (NPAs) by banks to Securitization Companies (SCs)/ Reconstruction Companies (RCs).
- Put in place the operating guidelines for small finance banks and payment banks in line with the BASEL standards Minimum capital requirement for a payment as well as small finance bank is fixed at 15%.
- In a significant move on consolidation of banks, Government of India approved 1/4/2017 as the record date for the merger of State Bank of India (SBI) with five of its associate banks, viz., State Bank of Bikaner and Jaipur (SBBJ), State Bank of Mysore (SBM), State Bank of Travancore (SBT), State Bank of Hyderabad (SBH) and State Bank of Patiala (SBP) and also Bharatiya Mahila Bank.
OUTLOOK FOR 2017-18
As per the World Economic Outlook, April 2017, by the International Monetary Fund (IMF), world output (global economy) growth has been projected to improve from 3.1% in 2016 to 3.5% in 2017, with positive growth emanating from Advanced Economies and Emerging Market and Developing Economies. The global trade volume has been projected to expand from 2.2% in 2016 to 3.8% in 2017. Further, the Indian Economy is projected to expand from 6.8% in 2016 to 7.2% in 2017. However, there are uncertainties revolving the protectionism stance, volatile global commodity prices and its ramifications, which may affect growth.
RBI, in its second bi-monthly policy review, has projected that India''s economy, as measured by Gross Value Added (GVA), would grow by 7.3% for 2017-18, with risks evenly balanced. The headline inflation has been projected in the range of 2-3.5% in the first half of the 2017-18 and in the range of 3.5-4.5% in the second half of 2017-18. The improved outlook is backed by several favorable domestic factors like the increased pace of demonetization and gradually improving economic activities in cash-intensive retail trade, hotels and restaurants, transportation and unorganized segments.
Structural reforms and initiatives undertaken by the Government of India and RBI are expected to positively impact growth in 2017-18. The transmission of past policy rate reductions into banks'' lending rates will also help encourage both consumption and investment demand in the economy. Likely roll-out of the Goods & Services Tax (GST) from July, 01, 2017, will establish a common market and the abolition of the Foreign Investment Promotion Board (FIPB) will boost investors'' confidence and bring in efficiency gains. The enabling amendments and policy initiatives undertaken the Government of India to address resolution of the stressed assets, like, institution of the Insolvency and Bankruptcy Code and empowering RBI to issue directions to a bank or banks to initiate resolution process under the Banking Ordinance, amending Banking Regulation Act, 1949, under Section 35 AA and Section 35 AB are expected to yield positive results and revitalize the banks.
Canara Bank performed better during the year in sync with its major thrust areas, viz., increasing retail deposits (including CASA), retail credit, fee income, containing NPA, recovery & up gradation and improving operational financial ratios, such as, Net Interest Margin (NIM), Return on Assets (RoA), Return on Equity (RoE) and Cost-to-Income Ratio.
FINANCIAL PERFORMANCE
During the year, the Bank posted improved performance on profitability and operational financial ratios. While total income was sustained at the previous year''s level, the Bank could substantially reduce its expenditure over last year, resulting in enhanced operating profit. Operating profit of the Bank increased by 24.72% to Rs,8914 crore compared to Rs,7147 crore last year. The Bank posted a net profit of Rs,1122 crore for 2016-17 compared to a net loss of Rs,2813 crore last year.
Key Financial Ratios (%) |
March 2016 |
March 2017 |
Cost of Funds |
6.31 |
5.59 |
Yield on Funds |
8.11 |
7.35 |
Cost of Deposits |
6.94 |
6.25 |
Yield on Advances |
9.71 |
8.99 |
Yield on Investments |
7.92 |
7.75 |
Net Interest Margin (NIM) |
2.19 |
2.23 |
Return on Assets (RoA) |
(0.52) |
0.20 |
Return on Equity (RoE) |
(10.69) |
4.15 |
Cost to Income Ratio |
50.65 |
48.85 |
While RoA and RoE increased to 0.20% and 4.15% respectively compared to negative levels in the last year, NIM improved to 2.23% against 2.19% last year and Cost to Income ratio reduced to 48.85% from 50.65% a year ago.
Income and Expenditure Analysis
During the year, total income increased to Rs,48942 crore, comprising Rs,29586 crore interest from loans and advances, Rs,10711 crore interest from investments, Rs,7554 crore from non-interest income and Rs,1091 crore from other income.
In line with the thrust areas for the Bank, non-interest income registered a robust increase of 54.95% to Rs,7554 compared to Rs,4875 crore recorded during last year. Excluding treasury trading profit of Rs,2982 crore, non-interest income rose by 17.68% to Rs,4572 crore. Apart from trading profit, other major sources of non-interest income, like, profit from exchange transactions (Rs,971 crore), recovery from written off accounts (Rs,489 crore), Government business (Rs,93 crore), banc assurance (Rs,87 crore) and service charges (Rs,1144 crore) contributed to the non-interest income of the Bank. The share of non-interest income to total income increased to 15.43% from last year level of 9.97%.
Total expenditure of the Bank came down by 4.13% y.o.y to Rs,40028 crore from Rs,41751 crore, including interest expenses, which declined by 8.01% to Rs,31516 crore. Operating expenses increased 13.62% to Rs,8512 crore, comprising staff cost of Rs,4915 crore and other operating expenses of Rs,3597 crore. Due to downward movement in the interest rates, the BankRs,s cost of deposits reduced by 69 bps to 6.25% from 6.94% during last year.
The net interest income, the difference between interest paid and interest earned by the Bank, increased to Rs,9872 crore compared to Rs,9763 crore last year.
Capital and Reserves
Net worth of the Bank, as at March 2017 increased to Rs,26914 crore compared to Rs,25911 crore as at March 2016. While the total paid-up capital of the Bank stood at Rs,597 crore, the reserves and surplus increased to Rs,33088 crore.
(Amt. Rs, Crore)
Composition of Capital |
March 2016 Basel III |
March 2017 Basel III |
Risk Weighted Assets |
333869 |
338999 |
CET I |
27308 |
30226 |
CET I (%) |
8.18 |
8.92 |
AT I |
2064 |
2896 |
AT I (%) |
0.62 |
0.85 |
Tier I Capital |
29372 |
33122 |
CRAR (%) (Tier I) |
8.80 |
9.77 |
Tier II Capital |
7633 |
10472 |
CRAR (%) (Tier II) |
2.28 |
3.09 |
Total Capital |
37005 |
43594 |
CRAR (%) |
11.08 |
12.86 |
Capital Adequacy Ratio, under Basel III, improved to 12.86% as at March 2017 against the regulatory requirement of 10.25%, including capital conservation buffer of 1.25%. Within the capital adequacy ratio, CET I ratio was at 8.92% and Tier I capital ratio was at 9.77%.
During 2016-17 the Bank raised Rs,5124 crore capital, comprising equity capital of Rs,1124 crore from the Rights Issue and Rs,1000 crore additional Tier I capital and Rs,3000 crore Tier II capital by issuing Basel III compliant Tier I and Tier II bonds.
The Bank is comfortable in the capital front. Given Government of India''s shareholding in the Bank at 66.30%, adequate headroom is available to raise capital in order to support the business growth momentum.
Deposits
Total Deposits increased Rs,495275 crore as at March 2017 compared to Rs,479792 crore a year ago, with a y.o.y. growth of 3.23%.
Current and Savings Bank (CASA) deposits of the Bank increased by 21.21% y-o-y to Rs,149749 crore as at March 2017. The Bank''s CASA deposits to domestic deposits improved to 32.85% from 27.38% last year. Savings deposits grew by 22.61% to Rs,127168 crore. Current deposits grew by 13.89% to Rs,22581 crore. A major portion of the accretion in CASA deposits had come with cash deposits of demonetized currencies of Rs,1000 and Rs,500 notes. Besides above, the focus on premier CASA products, like, Canara Galaxy, Canara Privilege, SB Power plus and NRI accounts was given to improve the average balances under CASA.
Pursuing a strategy of expanding deposit clientele, the Bank added 53 lakhs deposit clientele accounts during the year, taking the total number of deposit accounts to 6.97 crore.
Advances (net)
The Bank expanded its asset base to a well diversified one comprising of the productive segments of the economy, like, Agriculture and Micro, Small and Medium Enterprises (MSMEs) and other productive sectors in addition to the Retail assets, including Housing, Education, Vehicle loan segments.
In line with the banking sector credit growth, advances (Net) of the Bank grew by 5.33% to reach Rs,342009 crore as at March 2017 compared to Rs,324715 crore a year ago.
The number of borrowal clientele accounts increased to 82 lakhs as at March 2017.
Total business of the Bank increased to Rs,837284 crore, with a y-o-y growth of 4.07% compared to Rs,804506 crore in the previous year.
During the year, the Bankâs total clientele accounts increased by 54 lakhs to 7.79 crore from 7.25 crore last year.
In line with the thrust areas set for the year, the Bank''s retail lending operations recorded good y-o-y growth.
(Amt. Rs, Crore)
Outstanding retail loans portfolio grew by 8.95% y-o-y to Rs,58910 crore as at March 2017. The disbursals under various retail lending schemes amounted to Rs,34283 crore. The outstanding housing loan portfolio rose to Rs,32285 crore, with a y-o-y growth of 4.23% and accounted for 54.80% of the total retail lending portfolio. The Bank''s Vehicle loans and other personal loans increased by 19.34% and 14.82% y-o-y respectively.
Education Loans
Over the years, the Bank has assisted lakhs
of promising students to pursue higher education in India and abroad. The Bank''s education loan portfolio increased to Rs,7651 crore. The Bank has financed around 2.99 lakh students as at March 2017. The Bank is performing consistently well with progressive growth in education loan segment. During 2016-17, the Bank has disbursed education loans worth Rs,855.43 crore.
1000 institutions rated as ''A'' grade by NAAC have been mapped for providing education loans to students of these institutes. A Memorandum of Understanding (MOU) has been signed with M/s National Skill Development Corporation (M/s NSDC) for sanction of vocation education loans for students pursuing vocational courses in affiliated Institutes of NSDC throughout the country. MOU has also been signed with M/s The Institute of Company Secretaries of India, New Delhi for extending education loans. Tie-up arrangements are made with M/s BIOCON Ltd, M/s Bosch Ltd and M/s Bombay Stock Exchange Institute, M/s.Volvo Eicher Commercial Vehicles Pvt. Ltd., to encourage vocation education loans.
Government of India has set-up a fully IT-based Student Financial Aid Authority to administer and monitor Scholarship as well as Educational Loan Schemes, through Pradhan Mantri Vidya Lakshmi Karyakram to ensure that no student misses out on higher education for lack of funds. A Vidya Lakshmi portal <www.vidyalakshmi.co.in> has been made live on 15.08.2015. The students can apply online for Education Loan from any bank. The Bank has also in place ''Vidya Turant'', an online instant loan sanction facility to students and ''Vidya Sahay'', a bridge loan scheme for making down payment for Common Entrance Test (CET), at the time of selection and counseling.
The Bank has been designated as the Nodal Bank for administering subsidy schemes of Government of India, which includes Central Scheme of Interest Subsidy on Educational Loans (CSIS), National Rural Livelihood Mission(NRLM), Padho Pardesh subsidy scheme to provide Interest Subsidy on Education Loans for overseas studies pursued by students belonging to notified minority communities and Dr. Ambedkar Central Sector Scheme Of Interest Subsidy On Educational Loan for Overseas Studies for Other Backward Classes (OBCs) & Economically Backward Classes (EBCs).
Several initiatives were undertaken by the Bank to expand retail credit. During the year the Bank popularized its Online Instant in-Principle Sanction for Housing Loan and Car Loan platform, Pradhan Mantri Awaas Yojana, Housing cum Solar Loans and also Housing Loans to High Net worth Individuals (HNIs), Non-Resident Indians (NRIs) and Agriculturists. Nationwide launching of Campaigns, conduct of Expos, offering competitive interest rates, tie-ups with reputed Builders, Car Dealers, introduction of Direct Selling Agents etc., have helped the Bank in expanding its retail loan portfolio.
Sixteen new Retail Asset Hubs were opened, taking total number of RAHs to 81 across major centres in the country. The Bank also implemented several tech-based initiatives like missed call facility for retail lending Schemes, informing due dates and amount of EMIs for housing loans and introduction of web-based lead generation system.
INTEGRATED TREASURY
Aggregate investments (net) of the Bank stood at Rs,150266 crore as at March 2017. While modified duration of the investments portfolio stood at 5.10 as at March 2017, the modified duration of the Available for Sale (AFS) portfolio reduced to 4.02 from 4.45 in the last year. The trading profit under domestic treasury operations for the year increased to Rs,2982 crore as against Rs,990 crore in 2015-16. Following demonetization of the high value currency notes of Rs,500 and Rs,1000, the bond markets witnessed sharp fall in the yields due to excess system liquidity. The yield on investments declined to 7.75% as at March 2017 compared 7.92% a year ago, due to sale of securities and profit booking during the year.
The Bank continues to be an active player in the Government Securities Market as a Primary Dealer (PD). The total amount of bids submitted for underwriting was Rs,57,483 crore, of which, the underwriting commitment accepted by the RBI was Rs,19,172 crore. With regard to Treasury Bills under PD business, as against the minimum success ratio of 40% to be achieved in each half year, the Bank has a success ratio of 55.42% for the first half year ended September 2016 and 67.96% for the second half year ended March 2017.
Foreign Business Turnover of the Bank aggregated to Rs,235425 crore, comprising of Rs,107525 crore under exports, Rs,65047 crore under imports and Rs,62853 crore under remittances during the year ended March 2017.
The Bank has 8 overseas branches, viz., London and Leicester (U.K), Hong Kong, Shanghai (China), Manama (Bahrain), Johannesburg (South Africa), New York (U.S.A) and Dubai International Financial Centre(DIFC), Dubai (UAE). Besides the above 8 overseas branches, the Bank has a Representative Office at Sharjah (UAE), Canara Bank (Tanzania) Ltd., a wholly owned subsidiary at Dar es Salaam in Tanzania and Commercial Indo Bank LLC, a joint venture bank with State Bank of India in Moscow, Russia. The Bank''s wholly owned subsidiary at Dar es Salaam in Tanzania opened on 9th May 2016. Overseas business of the Bank crossed US $10 billion mark, constituting over 8% of the Bank''s total business as at March 2017. Total overseas business stood at Rs,68408 crore, comprising deposits of Rs,40666 crore and advances of Rs,27742 crore.
The Bank''s international operations are well supported by a wide network of 394 Correspondent Banks, spread across 80 countries and the Bank''s overseas branches and offices. Rupee Drawing Arrangement has been made with 36 Exchange Houses and 25 overseas banks for channelizing the remittances of Non-Resident Indians (NRIs). The Bank has been managing two Exchange Houses viz., Al Razouki International Exchange Company, Dubai and Eastern Exchange Est., Qatar under Secondment and Management Agreements respectively.
''Remit Money'', a web-based speed remittance product has been extended to 36 Exchange Houses and also to the Bank''s 4 overseas branches, viz., London, Shanghai and Hong Kong and Canara Bank (Tanzania) Ltd. To facilitate instant and hassle free remittances to the beneficiaries of Canara Bank in India, the ''Flashremit'', an instant credit facility in association with M/s. UAE Exchange, Abu Dhabi, UAE and ''Instant Remitmoney'' an instant credit facility with M/s. Al Razouki International Exchange Company, Dubai, M/s. Eastern Exchange Est., Qatar and M/s. Al Ansari Exchange LLC, UAE, continued during the year.
OTHER SERVICES
The Bank''s Merchant Banking Division handled Private Placement Capital Gain Bond Issues of National Highways Authority of India (NHAI) and Rural Electrification Corporation Ltd (REC) as Arrangers. The amount mobilized in respect of Capital Gain Bonds Issue of NHAI and REC during the year was ''87.19 crore.
The Bank acted as Collecting Banker for two Private Placement Issues and one Rights Issue, involving an amount of Rs,1998.30 crore. The number of Public and Debt Issues handled under Application Supported by Blocked Amount (ASBA) was 128 and the amount blocked was Rs,3018.02 crore. Two specialized assignments of ''Fair Valuation of EquityRs, were also handled by the Division during the year.
The Syndication Group handled projects, involving project cost of Rs,3691 crore during the year, with a total debt size of Rs,2030 crore. The Group earned a commission of Rs,3.40 crore during the year. The funds were arranged for projects in various segments, like, Special Economic Zone (SEZ), Hospital, Wind Energy, Solar Energy, Coal Based Power Generation, Textiles, Education Institution, Freight Corridor etc.
The Bank has tie-up arrangements in both life and non-life insurance segments under its ''Bancassurance'' arm. During the year, the Bank earned a commission income of Rs,38.3 crore from its joint venture, viz., M/s Canara HSBC OBC Life Insurance Company Ltd. Under the Mutual Fund business, the Bank earned a commission of Rs,14 crore from its joint venture, viz., M/s Canara Robeco Asset Management Company Ltd. A commission income of Rs,18.6 crore was earned under Non-Life (General) Insurance business from its tie-up arrangements with M/s United India Insurance Company Ltd (UIICL) and M/s Bajaj Allianz General Insurance Co Ltd. The Bank also earned a commission income of Rs,15.8 crore from its tie-up agreement with M/s Apollo Munich Health Insurance Co. Ltd for marketing their health insurance products. The Bank also has Corporate Agency Agreement with M/s Export Credit Guarantee Corporation of India for marketing export policies through its branches across India.
To give impetus to general insurance business and also offer innovative and new products at competitive prices to customers, Bank entered into corporate agency partnership with M/s Bajaj Allianz General Insurance Co. Ltd., as the second general insurance partner under the new IRDAI open architecture regulations. This partnership was launched on 26.11.2016 at Bengaluru.
Under Cards Business, the Bank took several initiatives to expand its card base. As at March 2017, total number of Debit Cards increased to 3.31 crore and Credit Cards base rose to 2.15 lakhs. The Bank earned a profit of Rs,13 crore from its card operation during the year.
The Bank offers its ''Depository Services'' from 47 DP Service Centres spread across 34 locations in the country. Through these Centres, the Bank is extending Online Trading Facility to DP clients from its own broking subsidiary M/s Canara Bank Securities Ltd., Mumbai. In order to have better synergy of operations and efficient delivery of services, its DP activity has been hived off to M/s Canara Bank Securities Ltd., with effect from 01.04.2017.
Executor, Trustee and Taxation Services outfit of the Bank provides services like Debenture / Security Trusteeship, Will and Executorships, Trusteeship, Personal Tax Assistance and Power of Attorney Services. During the year, it generated a fee based income of Rs,1.10 crore from the above services and availed Central Value Added Taxes (CENVAT) credit of Rs,106.80 crore during the year.
The Bank handles Government Business, comprising Direct and Indirect Tax collections, payment of Central Government and State Government Pensions, Handling of Postal Transactions and State Government Treasury Transactions, Public Provident Fund Scheme and Senior Citizens'' Saving Scheme and issue of Inflation Indexed Bonds of RBI, issuing Sovereign Gold Bonds, Sukanya Samridhi Scheme, accepting deposits under Pradhan Mantri Garib Kalyan Deposit Scheme (PMGKDS) and accepting tax under the Scheme. These products contributed to improvement of CASA and also earned a fee income of Rs,93.31 crore during year.
The Bank provides several online payment services, viz., E-payment of Sales Tax / Commercial Tax in Maharashtra, Tamilnadu, Karnataka, Andhra Pradesh, Bihar, Dadra & Nagar Haveli, Odisha, Punjab, West Bengal and Delhi, Virtual Treasury Package in Maharashtra, E-payment of Taxes to Transport Department in Tamilnadu, Collection of Property Tax for the Corporation of Chennai in Tamilnadu and Bengaluru in Karnataka, Online opening of PPF Accounts and E- Stamping project in Jharkhand, Uttar Pradesh, Tamilnadu and Karnataka.
The Bank has been authorized as the accredited banker for Ministry of Human Resources Development (MHRD), Ministry of Culture, Ministry of Youth Affairs & Sports, Archaeological Survey of India and Unique Identification Authority of India (UIDAI), New Delhi. The Bank implemented the National Pension System for Unorganized Sectors under Swavalamban Scheme during 2012-13. The Government of India has launched Atal Pension Yojana Scheme in place of Swavalamban with a view to provide defined pension to unorganized sector. The Bank could mobilise 1,05,232 accounts as at March 2017.
Agricultural Innovation Centre (AIC) outfit of the Bank handled 111 assignments. These 111 assignments consisted of 95 appraisals, 9 vetting, 6 viability studies and 1 project formulation. The total outlay of the assignments worked out to a term loan component of Rs,1011 crore and the Bank earned a fee income of Rs,4.76 crore during the year.
ASSET QUALITY
The Bank performed reasonably well in asset quality, despite continued stress at the industry level. The Bank was able to contain its Gross Non Performing Assets (NPAs) to gross advances ratio below 10% at 9.63% as at March 2017 compared to 9.40% as at March 2016. Gross Non Performing Assets (NPAs) as on March 31, 2017 stood at Rs,34202 crore compared to Rs,31638 crore in the previous year. With a Net NPAs of Rs,21649 crore, the net NPA ratio has come down to 6.33% from 6.42% a year ago.
Cash Recovery during 2016-17 aggregated to Rs,5042 crore compared to Rs,4758 crore in the last year. Recovery from written off accounts stood at Rs,705 crore of which, recovery from loss assets was Rs,352 crore. During the year, an amount of Rs,2265 crore was upgraded as against Rs,1460 crore in the previous year.
During the year, recovery amounting to Rs,541 crore was made on account of initiating action under SARFAESI Act. The Bank conducted 5513 recovery meets, which resulted in a recovery of Rs,404 crore. During the year 12515 cases were referred to Lokadalat, out of which, 6596 cases were settled, covering an amount of Rs,59 crore. Besides, the Bank took several initiatives to contain slippages and speed up recovery from overdue loan accounts. These include, identification of stressed accounts for restructuring/rephasing in time, conduct of Canadalats at branch level, cluster Adalats at Regional levels and mega adalats at Circle levels for one time settlements (OTS), Lokadalats at district levels, regular follow-up of overdues in loan accounts through Call Centre, conduct of e-auctions for sale of seized assets and initiation of stringent recovery measures against Wilful Defaulters. As at March 2017, there were 471 wilful defaulters, with an outstanding amount of Rs,3640 crore.
The Bank also formulated a Special Scheme for settlement of small NPAs (up to Rs,10 lakh), with a special focus on Education / Agricultural / MSME Loans. In the Educational Loan Sector, two Special OTS schemes were launched with liberal terms and additional concession for accounts with sanctioned limits up to Rs,4 lakh and for accounts with sanctioned limits above Rs,4 lakh and up to Rs,7.50 lakh. Special Scheme for small value agricultural loans with limit up to Rs,5 lakh and repeatedly restructured due to natural calamities and MSME loans up to Rs,1 crore launched to provide relief to the affected borrowers.
As at March 2017, the outstanding stressed assets portfolio (including restructured standard accounts) of the Bank stood at Rs,44581 crore, accounting for 12.55% of gross advances.
Risk Management
BASEL III Capital Adequacy Framework and Future Strategies
An independent Risk Management Wing at the Head Office is functioning as a nodal centre for overall implementation of various risk management initiatives across the Bank. Risk Management Sections are functioning at all 21 Circle Offices of the Bank as an extended arm of the Risk Management Wing.
The Bank has in place risk management policies across geographies and across all risks encompassing the entire gamut of risk profile. These include policies on Credit Risk Management, Operational Risk Management, Market Risk Management, Asset Liability Management and Group Risk Management.
The Bank has in place an Internal Capital Adequacy Assessment Process (ICAAP) under Pillar 2 of Basel III norms. The ICAAP exercise covers the domestic and overseas operations of the Bank, the Subsidiaries,
Joint Ventures, Sponsored Entities and Associates. Stress testing exercise is also performed by the Bank to ascertain the potential risks faced by the Bank. The ICAAP document is reviewed and approved by the Risk Management Committee of the Board and the Board of Directors.
The Bank has a Board Level Sub-Committee for Capital Planning Process. The Committee articulates macroeconomic scenarios vis-a-vis capital requirements of the Bank, in tune with business strategies. The Committee ensures maintenance of appropriate level of Capital to Risk Weighted Assets Ratio (CRAR) and evaluates various options for raising the capital.
Adoption of Advanced Approaches
In an Endeavour to move towards Advanced Approaches under Basel III for computation of capital for Credit, Market and Operational Risk, the Bank has engaged the services of a Consultant for implementation of Enterprise-wide Integrated Risk Management solution for itself and the Group Entities, so as to build requisite risk management framework.
As a pre-requisite for the implementation of Enterprise-wide Integrated Risk Management architecture, the Bank has procured a Risk Solution that would enable it to meet requirements of Advanced Measurement Approaches.
The Bank has submitted Letters of Intent to RBI for adoption of Internal Rating Based (IRB) Approach for calculation of capital charge for Credit Risk, Internal Models Approach for calculation of capital charge for Market Risk and Advanced Measurement Approach for calculation of capital charge for Operational Risk.
Preparedness for Basel III
The final guidelines on Basel III Capital Regulations became effective from 1st April, 2013. As per RBI guidelines, the transitional period for full implementation of Basel III Capital regulations is extended up to 31.03.2019. The banks in India need to maintain a minimum Common Equity Tier 1 (CET1) capital of 5.50%, Tier 1 capital of 7.00%, total capital of 9.00% and Capital Conservation Buffer (CCB) of 2.50% at the end of March 2019. The banks also have to maintain a minimum Tier 1 Leverage Ratio of 4.50% during parallel run from 1st January, 2013 to 1st January, 2017, as a credible supplementary measure to the risk based capital requirements.
The Bank endeavors to remain adequately capitalized and has drawn plans to meet the capital requirements stipulated by RBI in transitory phase. The Bank has adequate headroom to raise capital from the market, including recapitalization support from the Government of India. Moving ahead, the Bank''s capital requirement shall be met by injecting fresh equity capital, retention of profit, optimization of business levers, proactive capital planning and management.
Credit Risk Management
The Credit Risk Management process outlines the principles, standards and approach for credit risk management at the Bank. Systems, procedures, controls and measures are in place to actively manage the credit risks, optimize resources and protect the Bank against adverse credit situations. In order to comprehensively address the issues and concerns of the Credit Risk, the Bank has put in place a comprehensive Credit Risk Management Policy.
A robust system for appraisal of loan/credit proposals, including seeking adequate information for appraising the viability of the proposal and creditworthiness of the applicant for sanctioning credit limits, well defined credit approval process and authorization matrix, standards for collateral management, credit monitoring, restructuring of advances, MSME and Off Balance Sheet Exposures.
Risk Acceptance, Risk Measurement, Prudential Exposure Norms, Organizational Structure, Strategies and Operational Process are in place. In order to address the credit risk at portfolio level and the issue of concentration risk, the Policy prescribes fixation of various exposure ceilings. Risk Based Pricing is in tune with the Risk profile of the borrower to generate returns to achieve target RoA and NIM.
The Bank has a Loan Review Mechanism for constantly evaluating the overall performance of the borrowal accounts and for bringing about qualitative improvements in credit administration, monitoring and credit audit. The entire process of the Loan review and monitoring is dully administered by the Credit Administration & Monitoring Wing.
Market Risk Management
The Market Risk framework of the Bank aims at restricting loss from all types of market risk loss events and also to establish limit structure and triggers for various market risk factors.
Exposure limits, such as, Stop Loss Limits on Trading Book, Intraday and Overnight Limit for various Currency Positions, Dealer-wise Limits, Aggregate Gap Limit, Limits on Money Market Operations, Modified Duration Limits for investment portfolio and VaR Limits are fixed to act as risk mitigants/triggers. Mid Office of Risk Management Wing monitors these limits, along with other triggers, on a daily basis. A reporting framework has been put in place for effective and timely monitoring of market risk limits and triggers.
Operational Risk Management
Operational Risk Management framework in the Bank is based on ethics, organization culture and strong operating procedures, involving corporate values, internal control culture, effective internal reporting and contingency planning.
The Bank has adopted polices for management of Operational Risk, which covers various aspects, such as, Operational Risk Management Structure, Outsourcing Activities and Business Continuity Plan.
At present, the Bank is in the process of migration to Advanced Approaches of Basel III framework from Basic Indicator Approach (BIA). The Bank has initiated process and activities for implementation of Advanced Approaches and to put in place Incident Management, Key Risk Indicators (KRI), Risk Control & Self Assessment (RCSA) and Scenario Analysis to compute capital charge for Operational Risk.
Asset Liability Management
The ALM Policy of the Bank seeks to strike appropriate balance in the maturity and re-pricing profile of assets and liabilities, so as to reduce liquidity risk and manage interest rate risk. Within the policy framework, the Board of the Bank has set up Asset Liability Management Committee (ALCO), which is entrusted, inter alia, with the role of management of assets and liabilities including the funding strategies and its composition, product pricing, stress test and contingency action plan among others. A balanced ALM structure helps to sustain the spreads, profitability and long-term viability of the Bank.
The Bank has implemented the RBI guidelines with respect to Liquidity Coverage Ratio (LCR) with effect from 01.01.2015. As on 31.03.2017, LCR of the Bank is above the stipulated regulatory minimum of 80%.
Group Risk
The Bank has various Subsidiaries, Joint Ventures and Sponsored Entities, which are engaged in diversified activities. As the Bank has considerable stake in these Group Entities, Bank has put in place a Group Risk Management Policy to identify and manage risk in intra Group transactions and exposures to raise the standard of Corporate Governance by reducing and avoiding conflicts of interest between the Group Entities and also to ensure ''Arms Length Principle'' among Entities, with regard to business parameters. Presently, the Bank has introduced a Group Chief Risk Officer (GCRO) to supervise the risk management activities of the Group Entities.
NATIONAL PRIORITIES Priority Sector Advances
The Bank continues to accord importance to varied goals under national priorities, including agriculture, micro and small enterprises, education, housing, microcredit, credit to weaker sections and specified minority communities.
Priority Sector Advances of the Bank as at March 2017 reached Rs,160269 crore, recording a y-o-y growth of 10.11% and achieved 46.05% to Adjusted Net Bank Credit (ANBC) against 40% mandated norm.
(Amt. Rs, Crore)
Priority Sector Advances |
As at March |
Growth |
||
2016 |
2017 |
Amount |
% |
|
Total Priority Sector |
145558 |
160269 |
14711 |
10.11 |
Agriculture |
67176 |
74079 |
6903 |
10.28 |
With a focus on credit delivery to Agriculture, the Bank''s advances under agriculture portfolio increased by 10.28% to Rs,74079 crore, covering over 60 lakh farmers. Under agriculture lending, the Bank achieved 19.45% to ANBC against 18% mandated norm. During 2016-17, the Bank''s agriculture credit disbursal increased to Rs,58691 crore compared to Rs,57018 crore in the previous year.
The Bank undertook special campaigns for extending Crop Loans facility to all farmers.
During the year, the Bank issued 6.50 lakh Kisan Credit Cards (KCCs), amounting to Rs,10017 crore. The credit outstanding under KCCs was at Rs,14305 crore as at March 2017. 7.41 lakh Kisan RuPay Cards were issued against eligible accounts of 7.44 lakh, with an achievement of 99.60%.
The Bank actively participated in various Government Sponsored Schemes, such as, Prime Minister''s Employment Generation Programme (PMEGP), National Rural Livelihood Mission (NRLM), National Urban Livelihood Mission (NULM), Swarna Jayanti Shahari Rozgar Yojana (SJSRY), and Differential Rate of Interest (DRI) Scheme.
As at March 2017, the outstanding advances under the following Government Schemes, aggregated to ''999 crore, involving around 1.92 lakh beneficiaries.
Performance under various Government Sponsored Schemes
(Amt. Rs, Crore)
Scheme |
MARCH 2017 |
|
Accounts |
Amount |
|
Prime Minister Employment Generation Programme (PMEGP) |
13895 |
483 |
National Rural Livelihood Mission (NRLM) |
13625 |
284 |
National Urban Livelihood Mission (NULM) |
2367 |
21 |
Differential Rate of Interest (DRI) |
153186 |
141 |
Swarna Jayanti Shahari Rozgar Yojana (SJSRY) |
8547 |
70 |
Total |
191620 |
999 |
Advances to DRI stood at Rs,141 crore, consisting of 1.53 lakh beneficiaries, of which, advances by rural and semi-urban branches amounted to Rs,112 crore.
In support of the underprivileged sections of the society, the Bank''s advances to SCs/STs beneficiaries amounted to Rs,7354 crore as at March 2017, covering 5.45 lakh borrowers. The advances to SCs/STs comprised 4.59% of total priority sector advances.
Advances to weaker sections reached Rs,45106 crore, constituting 11.07% to ANBC against mandated norm of 10%.
Various components of advances to Weaker Sections as at March 2017
(Amt. Rs, Crore)
Sectors |
Outstanding |
|
Accounts |
Amount |
|
Small & Marginal Farmers, Landless Labourers, Tenant Farmers and Share Croppers |
3894735 |
39550 |
Artisans, Village and Cottage Industries |
43630 |
845 |
SC / ST Beneficiaries |
544614 |
7354 |
DRI Loans |
153186 |
141 |
SJSRY Beneficiaries |
8547 |
70 |
Self Help Group |
121350 |
2500 |
Joint Liability Group |
26764 |
587 |
As at March 2017, advances to specified minority communities aggregated to Rs,27688 crore, accounting for 17.28% of the total priority sector advances against the stipulated 15% norm.
Deendayal Antyodaya Yojana (DAY) - National Rural Livelihoods Mission ( DAY-NLRM/ Ajeevika)
Under the Scheme Aajeevika, National Rural Livelihood Mission (NRLM) was launched by the Ministry of Rural Development (MoRD), Government of India in June 2011, with an aim to reduce poverty by enabling the poor household to access gainful self employment and skilled wage employment opportunity, resulting in a sustainable livelihood. The main objectives of the Scheme includes providing interest subvention to Women SHGs (WSHGs) from rural areas who avail loans up to Rs,3 lakhs at 7% per annum and to provide an additional subvention of 3% if WSHGs repay in time, thereby reducing the effective rate of interest to 4%. In the first phase, the focus was on 150 most backward districts.
RBI vide their Circular FIDD.GSSD.CO.BC.No.13/09.01.03/ 2016-17 dated 25/08/2016, has intimated that Interest subvention scheme on credit to Women SHG during 2016-17 for all Commercial Banks and Co-operative Banks will be implemented in 100 more districts along with existing 150 districts. All WSHGs (Women SHGs) promoted by NRLM, NGOs, Central or State Government,
NABARD under WSHG Programme which are linked with the banks are eligible for benefits under the Scheme. Ministry of Rural Development, Government of India, has designated Canara Bank as nodal bank for handling claims of banks. The Bank has developed a web portal, which enables all member banks to upload their claims.
(Amt. in Rs, Crore)
Interest Subvention Claims made by all Member Banks |
||
Financial Year |
No of Accounts |
Amount |
2013-14 |
361231 |
266 |
2014-15 |
500829 |
304 |
2015-16 |
568304 |
365 |
2016-17 |
29020 |
394 |
TOTAL |
1720484 |
1330 |
Micro Small & Medium Enterprises (MSMEs) Lending
Advances to MSMEs increased to Rs,74302 crore as at March 2017, with a y-o-y growth of 11.42%. Credit to M&SE segments rose to Rs,53818 crore, with a 5.74% growth. The number of Micro Enterprises accounts recorded a growth of 16.46% against mandated norm of 10%.
Under Pradhan Mantri Mudra Yojana (PMMY), the Bank disbursed an amount of Rs,5182 crore during 2016-17. Sanctions and disbursals under different schemes of Mudra Yojana are as under:
Category |
As on 31.03.2017 (Amt. in Rs, Crore) |
|||
No. of Accounts |
Sanction Amount |
Disbursement Amount |
Outstanding Amount |
|
Shishu (< Rs,50,000) |
232338 |
795 |
790 |
671 |
Kishore (Above Rs,50,000 -Rs,5 lakh) |
156938 |
2873 |
2799 |
2459 |
Tarun (Above Rs,5 lakh to Rs,10 lakh) |
21023 |
1633 |
1593 |
1459 |
Total |
410299 |
5301 |
5182 |
4589 |
During the year, the Bank has taken following initiatives to increase flow of credit to MSME sector and also to bring about continued awareness about the steps taken.
- 166 SME Specialized Branches are functioning throughout India and for faster processing of credit proposals. Besides 166 SME Specialized Branches, 49 SME Sulabhs (Specialised SME Loan Processing Centres) are also functioning across the country.
- To extend financial assistance to micro and small enterprises without offering any collateral security and with relaxed lending terms, some segment specific schemes have been launched/ continued, such as, Doctors'' Choice (improved version), MSE SMART, MSME CAP, MSME Vahan, MSE Vijeta and Canara Contractors'' Scheme, Canara CARAVAN, Flavour and MSME Expo.
- To increase the Bank''s exposure to specific clusters and activities, new area / cluster specific schemes have been launched / continued, such as, Canara Textiles, catering to the Textile Sector, Special Scheme for lending to units engaged in Manufacturing of Ceramics and Vitrified Tiles and Weavers Mudra Scheme in lieu of Weavers Credit Card.
- Mega Credit camps are conducted to create awareness and pool sources for increased credit flow to MSME sector.
- Summits were arranged for Start-up Entrepreneurs involving functionaries from different Government Departments and local industrial bodies / organizations for necessary inputs and guidance for successful entrepreneurship.
- Micro Enterprises Business Centreâs were established at Circle Offices for handholding Micro Enterprises.
- The Bank has an exclusive website www. canaramsme.com for easy access and understanding of MSME initiatives.
- The online submission of MSME applications and tracking thereof by the customers are facilitated and used extensively by the MSME clientele.
- Entrepreneur Development Centre at Head Office have been catering to the needs of budding entrepreneurs by way of assimilation of information regarding the challenges and opportunities under MSME, conducting seminars, training initiatives, interaction with the concerned organizations and propagation of the same through regular bulletins.
-An exclusive set up established at Head office has been looking into the aspects of monitoring, slippage management and handholding in times of stress by way of rehabilitation and restructuring of MSME units as per Government guidelines.
The Bank is the nodal agency for Credit Linked Capital Subsidy Scheme (CLCSS) of Ministry of MSME, Government of India, for technology up gradation of Micro & Small Enterprises (MSEs). During 2016-17, subsidy amount received from the Ministry under the Scheme was ''11.22 crore and the same has been utilized fully during the financial year.
Empowering Women
Department of Women Empowerment at Head Office and Centre for Entrepreneurship Development for Women (CEDW) at 21 Circle Offices and 118 Regional Offices across the country are working relentlessly towards economic empowerment of women. These CEDWs have reached potential entrepreneurs, undertook counselling, supported training need, provided finance and marketing. A total of 350 programmes were organized by the CEDWs during 2016-17.
These centres have also assisted in the formation of Self Help Groups (SHGs) & Credit Linkages. Rural Self Employment Training Institute set up at Harohalli, Karnataka to provide EDP/ skill training to women in various vocations has trained 19,995 women since inception, out of which 630 women have been trained during 2016-17. Through 65 Training Institutes supported by the Bank, 4.05 lakh women have been trained in self employment ventures since inception, of which 33,393 have been trained during 2016-17. Apart from establishing two exclusive Mahila Banking Branches, the Bank has equipped over 80 branches with all women employees to give focused attention to women clientele. 18 Micro finance branches are also engaged in supporting the financial needs of micro & small women entrepreneurs & SHG members. 27.74 lakh women have been assisted with a credit outstanding to the tune of ''44766 crore as at March 2017 and achieved 13.59% to ANBC as against RBI''s requirement of 5%.
Several concessions have been provided to women borrowers that include relaxation in eligibility norms and 0.50% interest concession on educational loans to girl students. ''MSE Vijeta'', an exclusive loan Scheme for women entrepreneurs for loans up to Rs,2 crore under Micro & Small Enterprises and Canara Mahila Savings Scheme, a special Savings Bank deposit product, with many concessions have been devised for women.
During the year, six successful ''Women Entrepreneurs were given cash awards on the occasion of International Women''s Day under Canara Bank Best Woman Entrepreneur Awards (CBWEA), 2015-16''. Under marketing support, the Bank has provided five unique custom built, high-tech, solar powered mobile sales vans ''Canara Vahini'' with computerized billing and card swiping facility to enable women entrepreneurs and SHGs to exhibit or market their products at Bengaluru and Shivamogga (Karnataka) and Aligarh (Uttar Pradesh), Coimbatore (Tamil Nadu), and Thrissur (Kerala).
Lead Bank Responsibility
The Bank has lead bank responsibilities in 31 districts in the country, viz., 8 in Karnataka, 7 in Tamil Nadu, 5 in Kerala, 5 in Uttar Pradesh, 3 in Delhi, 2 in Telangana and 1 in Bihar. The Bank is the Convenor of the State Level Bankers'' Committee (SLBC) in Kerala.
Financial Inclusion
A Holistic Approach to Financial Inclusion
With the basic objective of bringing the large unnerved population under the banking mainstream, the Bank is striving towards a more inclusive growth by making financial products and services available to financially excluded and marginalized sections of the society in particular. As per the Government of India and the Reserve Bank of India directions, the Bank has been actively pursuing the agenda of Financial Inclusion (FI), with the key interventions, viz., expanding banking infrastructure, offering appropriate financial products, making extensive & intensive use of technology and through advocacy of financial literacy.
The Bank has 878 Financial Inclusion (FI) Branches under branch model and also engaged 2459 Business Correspondent Agents (BCAs) under Business Correspondents (BC) model. In addition, 473 Ultra Small Branches (USBs) are also operational in the Bank.
Pradhan Mantri Jan Dhan Yojana (PMJDY)
PMJDY is the initiative from Government of India for comprehensive financial inclusion of the population of India, particularly aiming at covering the households hitherto excluded from the purview of banking and empowering them with benefits and facilities provided by the banking industry. Accounts opened under PMJDY are issued with Rupay Debit card, accidental Insurance coverage to the extent of Rs,1 lakh, life insurance cover of ''30,000/- (for accounts opened up to 31.01.2015) and overdraft up to Rs,5000/- after six months of satisfactory dealing. The Bank was allotted 3962 Sub Service Area (SSAs) and 3371 Urban Wards for implementation of PMJDY.
Performance highlights under PMJDY
- Opened 64.66 lakh accounts under PMJDY and mobilized a CASA deposit of Rs,1858 crore.
- Covered all allotted 10049 villages comprising of 3962 allotted SSAs and 3371 Urban wards by opening of 878 brick & mortar branches and engaging 2459 Business Correspondent Agents (Bank Mitras) at remaining locations.
- Hand-held devices are provided to Bank Mitras for facilitating payments, which are enabled for accepting Rupay Cards. The Bank has Issued 42.59 lakh Rupay Debit Cards to all eligible account holders. Bank Mitras have done Rs,83.39 lakh transactions, amounting to Rs,1324 crore during the year.
- Zero balance accounts under PMJDY have been brought down to 14.24%.
- Established a Toll Free number 1800 425 11222 for PMJDY as a part of grievances redressal mechanism and popularized through publication in National Dailies.
-Provided overdraft facilities up to Rs,5000/- to all eligible PMJDY account holders. 2.14 lakh PMJDY accounts holders have been provided with overdraft facility, amounting to Rs,29.73 crore during the year.
So far the Bank has provided PMJDY overdraft facilities to 4.48 lakh account holders to the extent of Rs,74.26 crore.
Social Security Schemes
Under various social security schemes launched by the Government of India during the year, following enrolments have been made.
Scheme Enrolments |
As at March 2017 |
Pradhan Mantri Suraksha Bima |
37.18 lakh |
Yojana (PMSBY) |
|
Pradhan Mantri Jeevan Jyoti |
13.65 lakh |
Bima Yojana (PMJJBY) |
|
Atal Pension Yojana (APY) |
1.05 lakh |
Under Sukanya Samriddhi Yojana, the Bank has mobilized 11419 accounts.
Apart from the above, the bank has also made significant progress in the Financial Inclusion related activities during the year as under.
Business canvassed in the FI Branches
FI branches have garnered business of Rs,15202 crore, which includes CASA deposits of Rs,4136 crore, constituting 57.13% of total deposits. Average business per FI branch stood at Rs,17.31 crore.
Position of Basic Savings Bank Deposit (BSBD) Accounts
The Bank has opened 12.27 lakh BSBD accounts during the year 2016-17, taking the tally of BSBD accounts as at March 2017 to 1.66 crore, with an outstanding deposits of Rs,4678 crore.
Formation & Credit Linking SHGs
Financing to Self Help Groups has played pivotal role for poverty alleviation and financial inclusion of the rural poor. The Bank has formed 31754 SHGs and credit linked to the extent to Rs,1239 crore to 40070 SHGs during the year. The outstanding SHG accounts were more than 1.21 lakhs, with an outstanding amount at Rs,2500 crore.
Farmersâ Clubs
The Bank has adopted a concept of forming Farmers'' Clubs, which is an association of progressive farmers, who have volunteered to disseminate the principals of development through credit and also inculcate better repayment ethics and promote peoples participation. During the year, the Bank has formed 705 farmers clubs.
Micro Finance Branches
The Bank has opened 18 Micro Finance Branches in the urban centres. These branches mobilized a total business of Rs,600 crore as at March 2017.
Financial Literacy Centres
Formed ''Canara Financial Advisory Trust'' to take care of the affairs of the Financial Literacy Centres (FLCs) of the Bank as well as the FLCs promoted by the Regional Rural Banks (RRBs) sponsored by the Bank. Pan India, the Bank has 71 FLCs in all 26 lead districts and 45 blocks across the country, managed by the Counsellors (retired bankers).
Financial Literacy Initiatives
- Financial Literacy Centres have educated 14.51 lakh persons during the year and 45 Lakh persons since inception.
- Engaged Financial Literacy Coordinators to monitor and motivate Bank Mitras to involve themselves in Financial Literacy in a big way in their sub-service areas and encourage people to do more transactions.
- Trained Bank Mitras through Indian Institute of Banking & Finance and Infrastructure Leasing & Finance Services (IL&FS). They were also provided with extensive training on Banking and Technology aspects by the Bank and the Corporate BCs.
- Special training was given to Branch Managers for conducting financial literacy programmes at their branches and in their service area.
-Conducted 2612 financial literacy camps under Financial Inclusion Fund Scheme from the NABARD.
AADHAAR Enrolments
The Bank has empanelled 6 Aadhaar Enrolment Agencies. A total of 174 lakh enrolments have been done. Aadhaar has been seeded in 241 lakh accounts and are on National Payments Corporation of India (NPCI) mapper.
CORPORATE SOCIAL RESPONSIBILITY
Setting Examples in CSR Activities
Following the founding principles and century old tradition, the Bank is engaged in varied Corporate Social Responsibility (CSR) activities. CSR initiatives of the Bank are multifarious, covering activities, like, training unemployed rural youth, providing primary health care, drinking water, community development, empowerment of women and other social initiatives.
Rural Development
The Bank, through its Canara Bank Centenary Rural Development Trust (CBCRDT), has established 34 exclusive training institutes, including 26 Rural Self Employment Training Institutes (RSETIs), 5 Institutes of Information Technology and 3 Artisan Training Institutes to promote entrepreneurship development among rural youth and encourage them to take up self employment activities. During 2016-17, these Institutes trained 30,384 candidates, taking the tally to 2.87 lakh unemployed youth since inception, with an impressive settlement rate of 75%.
The Bank has co-sponsored another 27 Rural Development and Self Employment Training Institutes (RUDSETIs) across 17 States, engaged in training of rural youth for taking up self-employment programmes. During 201617, these Institutes trained 26,284 candidates, taking the tally to 4.23 lakh unemployed youth, with a settlement rate of 72%. The Bank has also co-sponsored Andhra Pradesh Bankers Institute for Rural and Entrepreneurship Development (APBIRED) at Hyderabad, Telangana and
Canara Bank Deshpande RSETI at Haliyal, Karnataka Farmers Resource Centre (KFRC) at Bagalkot and Bharat Ratna Shri M Visvesvaraya Training Institute at Bengaluru, Karnataka. Cumulatively, the Bank has sponsored / co-sponsored 65 training institutes, which have trained more than 7 lakh unemployed youth so far, with a settlement rate of 72%. The Bank has donated 4 hi-tech, custom built, solar powered ''Retail Mobile Marketing Van'' to assist women entrepreneurs, SHGs and artisans to market their products. During the year, the Bank undertook a number of activities for the benefit of the communities as part of CSR.
The Bank has undertaken an ambitious project of providing De-fluoridation - RO plants for pure drinking water facility in fluoride affected villages of Kolar and Chikkaballapur districts, Karnataka. Pure (RO) Drinking water plants have been installed in 156 villages of Kolar District and made operational. Over 1,00,000 people from these villages are benefitted by the project. The Bank has also partnered with International Association for Human values (IAHV) Art of Living, Rejuvenation of Manjara River at Latur, Maharastra and District Administration, Aizawl, Mizoram for Construction of RCC Foot Bridge over Theihauliu stream.
Health care for the underprivileged
Dialysis machines are provided for free treatment to underprivileged in M/s Rangadore Memorial Hospital, Bengaluru, a unit of Shri Shri Jagadguru Shankaracharya Mahasansthanam, Shringeri. The Bank has provided Haemodialysis machines to Canara Bank Relief & Welfare Society, Bengaluru and carried out renovation of patients lounge in Sevakshetra hospital, Bengaluru. The Bank has donated equipments and vehicle for four Primary Health Centres in Kolhapur district, Maharashtra. Ambulance services were rendered to M/s Bidar Institute of Medical Sciences, Bidar, Karnataka. Ambulance services to serve sick tourists in dormitories and villagers were also provided to M/s Jagannath Ballav Endowment, Puri, Odisha and Central University of Himachal Pradesh, Dharmashaala. The Bank also provided Deep Freezer for Blood Bank for Indian Red Cross Society, Bengaluru and constructed SHE E-Toilets under Greater Hyderabad Municipal Corporation, Hyderabad.
Direct and Indirect support to Education
Education being one of the prime sectors of CSR and a vital part of personality development, Bank apart from its own initiatives, has assisted various educational institutions.
Canara Vidya Jyothi Scholarship scheme to meritorious SC / ST Girl Students
The scholarship was provided for those studying in Government and Government aided schools for the fourth successive year and 10,655 students have been benefitted utilizing a total amount of Rs,3.94 crore.
The Bank has assisted Canara Bank Jubilee Education Fund, Bengaluru for upgradation and automation of the Book bank and extending scholarships to students. The Bank has also sponsored tuition fee for students under MDM Course in Shri Vivekananda Youth Movement (SVYM) Mysuru. Government Secondary School, Gagsina, Karnal District, Haryana has been provided solar power system, computers, water purifier and furniture. The Bank has given 40 KVA Generator for Krishna Bal Vidya Mandir Inter college, Mangupura, Moradabad, Uttar Pradesh.
Financial assistance to combat Poverty & child development
M/s Akshaya Patra Foundation was given vehicle with accessories for carrying mid-day meals to children studying at Government Schools in Jodhpur, Rajasthan. The Bank has also provided stainless steel dining tables for dining hall of M/s Ramakrishna Math, Kolkata for the use of poor visitors.
For supporting persons with disability to lead a better life, a number of programmes in association with likeminded agencies have been taken up.
Visits by Parliamentary Committee
During the year 2016-17, Parliamentary Committees relating to Subordinate Legislation, Industries, Finance, Rural Development, Commerce, Women Empowerment and Official Language visited the Bank.
ORGANISATION AND SUPPORT SERVICES Branch Network
Expanding Pan India Presence
The Bank undertook branch expansion drive in 2016-17 and added 239 domestic branches during the year. As at March 2017, the Bank had 6083 branches, including 8 overseas branches.
Composition of Branch Network
Category |
No. of Branches |
Opened during the year |
|
31.03.2016 |
31.03.2017 |
||
Metropolitan |
1019 |
1228 |
44 |
Urban |
1142 |
1138 |
54 |
Semi-urban |
1815 |
1936 |
81 |
Rural |
1865 |
1773 |
60 |
Overseas |
8 |
8 |
-- |
Total Branches |
5849 |
6083 |
239 |
Note: 5 branches were merged / closed during the year.
The Bank added 9 Specialized Branches during the year, taking the total tally under the Specialized Branches to 285 as at March 2017.
Categories of Specialized Branches |
31.03.2017 |
SME |
166 |
Mid Corporate |
26 |
Micro Finance |
18 |
Asset Recovery Management |
19 |
Prime Corporate |
12 |
Overseas |
11 |
Agri-Finance |
9 |
NRI |
7 |
Savings |
2 |
Industrial Finance |
3 |
Stock Exchange |
2 |
Capital Market |
1 |
Mahila Banking |
2 |
Branch for Physically Challenged |
1 |
Specialized Govt Business Branch |
6 |
TOTAL |
285 |
Progress in Digital Banking & Alternate Delivery Channels
During 2016-17, the Bank added 1268 ATMs, taking the total number of ATMs to 10519. The Bank''s debit card base rose to 3.31 crore compared to 3.19 crore as at March 2016. Besides the above, 182 hi-tech E-lounges were also operational in select branches, with facilities like ATM, Cash Deposit Kiosk with voice guided system, Cheque Deposit Kiosk, Self Printing Passbook Kiosk, Internet Banking Terminal, Online Trading Terminal and Corporate Website Access. Interactive Video Conference System was also configured at select e-Lounges.
Accelerated adoption of digital payment channels by the customers have been witnessed post-demonetization. This has paved the way for moving towards a less cash economy. As a result, e-transaction percentage has jumped to a level of 64.7% as at March 2017 from 54.2% a year ago. All digital channels have witnessed exponential growth in value and volume of transactions. Net banking registrations recorded a growth of 183%, mobile banking transactions grew by 253% and Unified Payment Interface (UPI) registrations has recorded a growth of 220%. The number of Mobile Banking users increased to 51.59 lakhs and Net Banking users increased to 30.40 lakhs as at March 2017.
Customer-friendly InfoTech Initiatives
Apart from bringing improvement in the Mobile Banking and Net Banking features, during the year, the Bank introduced and improved upon several Apps, Tech-products/services for the convenience of the customers.
Canara Empower - Unified Payment Interface (UPI), a single platform to access multiple bank accounts.
- Canara mServe, which enables customers Bhh to hot list and Block/Unblock Cards.
- Canara Swipe, all missed call solution in a _ single application.
Canara GeoLocate, app for locating Branches and ATMs
Canara Cart, an umbrella app containing . all mobile based solutions.
- Introduced âGreen PINâ functionality for enabling the customers themselves to generate Debit Card PIN at the time of Issuance of Card and also if PIN is forgotten.
- Customers can now download, register and activate Can Mobile without visiting a Brach or ATM. Mobile Banking registration through ATM introduced.
- Upgraded Internet Banking released with simplified functionalities.
- Instant Loan application portal for Housing Loan and Car Loan made live.
- Implemented Cheque Book indent through SMS
- Missed call / SMS based ePass sheet generation made live
- P2U (Person to UIDAI) funds transfer through Mobile Banking in WAP channel enabled.
- Implemented Social Security Schemes of Govt. of India, PMJDY OD Automation facility for eligible PMJDY customers for availing OD facility through ATMs. Introduced facility for online account opening under Atal Pension Yojana (APY). Subscription to the Social Security Schemes through ATM, SMS and Internet Banking enabled.
- Enabled Pradhan Mantri Garib Kalyan Yojana Deposit Scheme and tax payment through Net Banking and Branches.
- Web Portals under education loan interest subsidy released for Central Scheme for Interest Subsidy (CSIS), Ministry of HRD, GoI, Dr. Ambedkar Central Sector Scheme of Interest Subsidy (ACSIS), Ministry of Social Justice & Empowerment, Government of India and Padho Pardesh, Ministry of Minority Affairs, Government of India.
- Issued MUDRA Debit Card for overdraft accounts under MUDRA Card Scheme.
- Implemented SMS/Email Alerts to NPA Borrowers intimating to regularize overdues in accounts.
To enhance digital transactions, in the line with Government of India initiatives, the Bank is onboarding merchants for increasing usage of Debit and Credit Card payments, Unified Payments Interface (UPI), BHIM App, BharatOR Code and Aadhaar-enabled Payment Systems (AEPS). The Bank is in the process of implenting more digital initiatives for customer convenience and better service.
Compliance to International Standards
The Bank has fully implemented the recommendations of the RBI Working Group (Chairman, Shri G Gopalakrishna) on Information Security, Electronic Banking, Technology Risk Management and Cyber Frauds. The Bank obtained the ISO 27001: 2013 Certification on 12.04.2014.
Manpower Profile
As at March 2017, the Bank had 55,717 employees on its roll.
Cadre |
March 2016 |
March 2017 |
Officers |
24174 |
26127 |
Clerks |
20194 |
20549 |
Sub-Staff * |
9640 |
9041 |
Total |
54008 |
55717 |
* Includes Part Time Employees (PTEs)
Total staff of the Bank comprised 47% Officers, 37% Clerks and 16% Sub Staff. Women staff of the Bank comprising 16,589, constituted 30% of the employees. The total number of ex-service men staff as at March 2017 stood at 3,779. There were 1337 Physically Challenged Employees on the rolls of the Bank.
During the year, the Bank recruited 4,952 in various cadres, out of which 822 belonged to Scheduled Castes (SCs) and 366 to Scheduled Tribes (STs) categories. 421 ex- servicemen were recruited in various cadres during the year. 1,498 women employees were recruited and 769 were promoted under various cadres during the year.
Reservation Policy in respect of Scheduled Castes and Scheduled Tribes
As at March 2017, the number of Scheduled Castes and Scheduled tribes together constituted 27% of the total staff strength of the Bank. The composition of SCs/STs employees as at March 2017 was as under:
Cadre |
Scheduled Castes |
Scheduled Tribes |
Officers |
4694 |
1989 |
Clerks |
3843 |
1273 |
Sub-Staff |
2724 |
500 |
Total |
11261 |
3762 |
The Bank has been strictly adhering to the Reservation
Policy in respect of Scheduled Castes and Scheduled
Tribes as per the Government of India guidelines.
(a) Reservation Policy is implemented through mechanism of Post Based Rosters. In terms of the directives of the Ministry of Finance, Government of India, Bank has switched over to Post Based Rosters for all cadres.
(b) The Bank has been extending Reservation/ Relaxations / Concessions in Direct Recruitment as well as in promotions to candidates belonging to Scheduled Castes and Scheduled Tribes as per the Government guidelines.
(c) Pre-recruitment & Pre-promotion training is given to candidates belonging to Scheduled Castes and Scheduled Tribes. In the Advertisement inviting application from the eligible candidates for recruitment to Clerical Cadre, a specific reference is made with regard to imparting of pre-recruitment training to candidates belonging to SC / ST / PWD / Minority Communities / Ex-SM. Pre-recruitment training for Officer Cadre is provided to candidates belonging to SC / ST & Minority Communities. Such of those candidates who opt for pre-recruitment training are given training to prepare themselves for written test as well as interview. The duration of the training is for a week.
(d) The Bank has setup SC / ST Cell at the Head Office and also at Circle Offices to ensure maintenance of Rosters and proper implementation of other aspects of Reservation Policy.
(e) Chief Liaison Officer has been nominated at Head Office and Liaison Officers have been nominated at Circle Offices for ensuring implementation of Reservation Policy.
Further, representations received from Scheduled Caste / Scheduled Tribe employees, either directly or through the SC / ST Associations, are being looked into by the Liaison Officer / Chief Liaison Officer. Wherever required, necessary enquiries are conducted & appropriate action is taken. A separate register is maintained for recording various representations received from Scheduled Caste /
Scheduled Tribe employees and the action taken is also recorded in the register.
In addition to the above, the representatives of majority Scheduled Caste / Scheduled Tribe Employees'' Association are invited for Quarterly Meeting with the Chief Executive of the Bank to discuss on the implementation of guidelines on reservation policy. Quarterly Meetings are also held at Circle Offices, where Rosters are maintained and grievances, if any, are redressed by the Liaison Officer.
(f) The Board of Directors of the Bank also review the progress made in the implementation of Reservation Policy, half yearly and yearly.
Human Resource Development (HRD) activities
The HR policies of the Bank have been revisited to suit the changing banking scenario. HR initiatives, like, ''Soft skill training programme'' for bringing attitudinal change among frontline staff and Executives grooming through reputed institutes and other significant HR tools, like, Study Circles, Staff Meetings and Brain Storming Sessions have been implemented for effective team building and fostering collective excellence. Various Corporate Communications were brought out to boost the morale of the employees and educate them in various facets of banking.
A high sensitization training programme christened âUTTHANâ has been conducted by the Staff Training College (STC), Bengaluru. The training programme is imparted to empower large number of young employees who have been recently recruited and also other senior employees by sensitizing them regarding Bank''s culture, ethos, sense of belongingness, ownership and concern for customers with view to achieving the corporate objectives towards organization growth. The Bank has in place an exhaustive training process that cover Internal Training, External Training, In Company Training and Foreign Training. Internally, the Bank has STC at Bengaluru and 23 Regional Staff Training Colleges (RSTCs) across the country.
During the year, the Bank has trained 72,451 employees, covering a wide range of functional areas, including Credit Orientation, Marketing Skills, Induction Programme for Officers, Agriculture Extension Officers and Specialist Officers. Out of the trained staff, 14,878 personnel belonged to the Scheduled Caste category and 5,139 belonged to the Scheduled Tribe category. The total employees trained include 22,895 women employees.
The Bank has designed and implemented several new training programmes, including credit management and decision making skills, credit appraisal programme for Branch Managers and workshop on recovery aspects for Executives.
Under a novel programme, viz., Talent Bank Scheme, a talent pool was formulated, comprising Officers from Scale I to Scale IV, who are willing to take up challenging assignments in the identified critical or specialized areas. 1096 Officials have been selected under the Scheme. Intensive Credit Management Programme is being conducted in 2 phases. This is an in-depth and exhaustive programme on credit matters evolved by Staff Training College, for Officers in Scale I - III, to build specialization in credit. Intensive Training Programme on Credit over the years has built a talent pool of over 1000 Officers.
Further, the Bank''s quest to enhance the competencies of the workforce continued through focused and need based training at various institutes of repute, like, IIMs, JNIBF, ISB, XLRI and NIBM, etc. Customized programmes are also organized to develop expertise in certain niche areas, like, Credit, Risk Management, Treasury Operations and IT.
Specialized trainings to the Senior Management Level and Top Management Level Executives were conducted based on the requirement. The Bank has been able to add substantially to the skill level of its Officials through training intervention and motivating them to perform with renewed vigour and enthusiasm. A governing body for the training setup, headed by the Managing Director & CEO has been established to monitor and streamline the training policies of the Bank.
Changes brought about in the organizational set up during 2016-17
Organizational design and structure was reviewed and studied for further improvement and bringing in operational excellence. To establish more connect with customers and branches, from July 1, 2016, the Bank completely moved to a 4 tier structure for its retail business, comprising Head Office, 21 Circle Offices, 118 Regional Offices and Branches from earlier 3 tier structure, consisting of Head Office, 47 Circle Offices and Branches.
The Bank has also put in place a 2 tier structure for its corporate business with 12 Prime Corporate Branches under Prime Corporate Credit Wing at Head Office. Post reorganization and re-alignment of functions of Wings at Head Office, there were 21 Wings at HO apart from Staff Training College, Compliance Department and Corporate Communications Department.
Earlier, the Bank had launched âProject Shikharâaimed at rejuvenating the Bank by focusing on various themes, like, better branch layout & customer service for customer delight, quality service delivery & reduction in service time, focus on digital banking by promoting transactions on self service machines and alternate channels, inculcating sales culture and focus on business, particularly CASA and fee income growth. In the journey of transformation of branches, number of âShikhar Branchesâ rose to 1211, with 165 branches under star 5 and 67 under star 4 categories as at March 2017.
Marketing and Publicity
The Marketing Vertical has played a significant role in improving the CASA share, retail business, fee income from the Associate Parties business, wallet maximization and propagating the multifarious technological products and services for the benefit of the customers.
The Bank further strengthened marketing vertical during the year by inducting specialized personnel into the setup, with the support of Marketing Sections in all Circle Offices, overseen by the dedicated Marketing Executives and lead management system. Marketing set up has taken initiatives in cross selling and up selling of Bank''s products by launching several campaigns during the year.
The Bank also launched publicity campaigns for its several new products and services introduced during the year and used effectively all channels of communication, including advertising, social media and marketing collaterals to enhance its brand image. The Bank is observing 5th of every month as âHelp Our Customer Dayâ to create awareness about Health Insurance and âProtect Your Customer Dayâ on 15th of every month to educate customers on importance of adequate Life Insurance across branches.
Customer Orientation
Several initiatives were taken to remain customer focused through providing fast service, bringing in diversified products & services, responding to customers'' queries and redressal of customer complaints. The ''Code of Commitment to Customers'' issued by Banking Codes and Standards Board of India (BCSBI) and ''Revised Citizen''s Charter'' of Indian Banks Association (IBA) is available in the Bank''s homepage of the website
Further, during the year, the Bank undertook a Customer Satisfaction Survey through a professional External Agency to assess the level of customer service and customer satisfaction across the Country.
In order to enhance customer focus the âProject Shikhar - Branch Transformationâ was implemented during the year wherein various customer centric initiatives, like, Welcome Desk, Queue Management System (QMS), Single Window Operation and allocation of larger space for ''Customer Waiting Area'' etc., along with self-service kiosks are put in place. In order to enhance customer convenience, the Bank also made efforts at various levels to popularize various Apps, like, Missed Call Facility through Canara Swipe, Canara Empower, Internet and Mobile Banking, Canara e-info book, Canara m Serve, Canara Geo locate and Canara Easy Cash facilities etc. Besides, a Call Center with single point contact Toll Free Number 18004250018 is functioning to cater to customers in 6 regional languages of Kannada, Malayalam, Marathi, Tamil, Oriya and Telugu, besides Hindi and English for redressal of grievances.
The Bank has implemented online grievance redressal facility for customers in the website for lodging grievances online under the portal âCanara Public Grievance
Redressal System (CPCRS)â. The complaints received at Call Centre were also integrated with CPGRS package. During the year, Call Centre registered 7896 grievances in CPGRS and all grievances were redressed as per prescribed time norms. Centralized Pension Processing Cell has been established exclusively for handling pensions and resolving pension related grievances. 42 Central Processing Centres were functioning at selected places for account opening purposes.
During the year, ''Town Hall Customers Meet'' was held at Vythiri, Pulikal and Sultan Bathery in Kerala in association with the Banking Ombudsman, RBI and Customer Meets were conducted at Gurgaon, Ludhiana, Nasik, Kochi and Kolkata in association with BCSBI.
Systems and Procedures
Risk based Internal Audit (RBIA) was conducted in 4293 branches / units programmed for onsite RBIA during the year. Information Security audit was conducted along with RBIA. Concurrent / continuous audit was conducted in 963 branches / service units, of which 225 branches /units were subjected to concurrent / continuous audit by Internal Auditors and 738 branches / service units were subjected to concurrent audit by External Auditors, covering 70% of the total business of the Bank. 2304 branches were subjected to income/revenue audit, which included branches identified for income audit on quarterly basis.
A revision in the risk rating matrix for RBIA of Branches, Units and Circles was made from earlier 3 scales (Low, Medium and High Risk) to 4 Scales - A (Low), B (Normal), C (Moderate) and D (High) during the year.
The Bank has already implemented Computerized Audit through Web Based Audit Package called, ''DARPAN'', for RBIA of branches. The scope of such DARPAN is proposed to be extended for Concurrent Audit, RO Audit, Circle Audit, IS Audit, KYC Audit etc., during the current year. In case of branches which were witness to frauds, suitable provisions made in RBIA to re-rate the risk gradation and reducing their rating to either âHighâ or âA notch Lowerâ (higher risk grade).
As per the directions of RBI / DFS, Ministry of Finance, the Bank undertook SBN (Specified Bank Notes) audits through its Internal Audit Workforce in 1006 branches, including branches situated at border areas, far flung areas, North-East and Left Wing Extremism affected areas. Off Site monitoring was further strengthened to have an oversight of transactions on a near real time basis. Reports on certain identified scenarios have been generated and made available to Circles Offices for review and monitoring of transactions, including SBN verification.
Risk Based Supervision
The Bank is brought under Risk Based Supervision (RBS) regime by RBI, in lieu of Annual Financial Inspection (AFI) from 2014-15. Presently, the Bank has completed the 3rd cycle of RBS. RBS framework is named as Supervisory Programme for Assessment of Risk and Capital (SPARC). Under SPARC, a detailed qualitative and quantitative assessment of the Bank''s risks is made by the RBI on an on-going basis through a combination of offsite and onsite Risk Discovery Process (RDY).
Know Your Customers (KYC)/AML/CFT
The Bank undertook various measures for the effective implementation of guidelines on Know Your Customer (KYC), Anti Money Laundering (AML) and Combating Financing of Terrorism (CFT).
Some of the major achievements and initiatives taken were as under:
- AML/CFT centralized unit formed on 30th June 2016 for exclusive processing and monitoring of AML/SDN (Specially Designated Nationals) alerts.
- System checks/enhancements are put in place to ensure compliance to guidelines on KYC/AML/CFT.
- System checks and enhancements implemented for Trade Based Money Laundering (TBML) alerts.
- Two AML/CFT/KYC sensitization programmes were conducted on 09.09.2016 at Gurgaon and on 17.09.2016 at Bengaluru.
- Branch/Circle/Regional Office staff members were sensitized by way of issuance of guidelines and periodical training.
- AML/CFT Centralized unit has filed 5899 Suspicious Transaction Reports (STRs) during 2016-17 and 28061 STRs on account demonetization based on
5 Red Flag indicators of Financial Intelligence Unit (FIU) India.
- KYC Cell has been designated as one point contact for RBI, Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) etc for all KYC matters.
- KYC Cell has registered with CERSAI / Central KYC reporting.
Vigilance Setup
The Vigilance Wing of the Bank is headed by a Chief Vigilance Officer (CVO). The CVO is assisted by the Vigilance Officers stationed at Head Office, all Circle Offices, RRBs and the Bank''s Subsidiaries. The objectives of the Vigilance Wing are to ensure that discipline and development, go in tandem and help the Bank to reach greater heights. With an objective to ensure free, fair and healthy environment for all-round growth of the organization, the Vigilance Management in the Bank comprised preventive, participative and punitive functions. These goals are pursued and promoted through various means and channels.
As a part of the Vigilance Awareness campaign, Canara Bank observed ''Vigilance Awareness Week'' from 31st October 2016 to 5th November 2016 as per the directives of Central Vigilance Commission. Various programmes were conducted throughout the country with the support of Circle offices and branches to spread awareness regarding observance of Vigilance Week and its importance. Programmes, like, debates, impromptu speeches and quizzes were organized at 89 schools and colleges highlighting the theme âPublic participation in Promoting Integrity and Eradicating Corruptionâ across the country.
On this occasion, on 2nd November 2016, Shri N Santosh Hegde, former Lokayukta, Karnataka, addressed the gathering on the theme of Vigilance Awareness Week. The function was presided over by Shri Rakesh Sharma, MD&CEO of the Bank in the presence of Shri Harideesh Kumar B, Shri Dinabandhu Mohapatra and Smt. P V Bharathi, Executive Directors of Bank. A one day workshop was organized for select Circle Vigilance Officers at Head Office on 21.10.2016.
Canara Bank is conferred with âCorporate Vigilance Excellence Award-2016-17â in the Banking Sector consecutively for the fourth year, instituted by M/s Institute of Public Enterprise, Hyderabad, for promoting excellence in the field of Vigilance amongst all PSBs / PSUs.
Security Arrangements
Out of 6075 branches and 104 currency chests, the Bank identified 52 branches as High Risk, 1635 branches as Medium Risk and 4388 as Low Risk. These branches and currency chests were periodically visited by Security Officers as per statutory guidelines. All the sensitive currency chests were visited by the Chief Security Officer during the year.
The following measures were initiated based on the instruction from the RBI and State Police Authorities:
a) All branches, currency chests & ATMs have been provided with CCTV Cameras / DVR.
b) 1558 ATMs are guarded with private Security Guards based on the threat perception and directions from Police Authority.
The security set up in the Bank has been under regular up gradation with the security apparatus and issuing of suitable instructions & guidelines to all branches from time to time, including focusing on fire safety measures.
Right to Information
Under the Right to Information Act, 2005, an exclusive Right to Information Act outfit is functioning to provide information and bring transparency. During June 2016, Department of Personnel Training, Ministry of Finance, Government of India has come out with a web based online RTI portal to enable the citizens to make online applications/appeals. This web based package has been given to the Bank with effect from 20th July 2016. To comply with the RTI guidelines and to cater to the needs, the Bank has nominated a Nodal Officer at Head Office and a Public Information Officer (PIO) and an Appellate Authority (AA) for all Regional Offices, Circle Offices and Head Office. Presently, there are 140 PIOs and 140 Appellate Authorities. During the year, the Bank received 3918 RTI applications, 905 First Appeals and 37 Second Appeals as per the provisions of RTI Act, 2005.
Implementation of Indian Accounting Standards
As per the RBI guideline, the Bank is in the process of implanting the Indian Accounting Standards (Ind AS). A Projects Steering Committee and an International Financial Reporting Standards (IFRS) Cell have been formed to take the required steps on a continuous basis for smooth convergence. The Bank has appointed M/s. Deloitte Haskins & Sells LLP as the consultant for assisting the bank in smooth implementation of Indian Accounting Standards. The pro-forma financial statement for the half year ended 30.09.2016 has been submitted to RBI within the due prescribed date.
Implementation of Official Language
The Bank made noteworthy progress under the implementation of official language and won many prizes at various levels during the year under review.
As at March 2017 around 98% of employees have obtained working knowledge in Hindi and the Bank has notified 3501 Branches under Rule 10(4) of OL Rules 1976. All the employees of the Bank possessing working knowledge of Hindi have been trained in functional Hindi through Hindi workshops. During the year under review, Bank has conducted 384 refresher training programmes for such employees.
In the sphere of using Information Technology in the Official Language, the Bank has furthered the use of Unicode package for word processing and also made provision in ATM screens of the Bank for carrying transaction in 10 Indian languages. Apart from Hindi and English, transaction slips can be obtained in Malayalam, Tamil, Telugu, Kannada, Punjabi and Marathi from ATMs and transactions done in concerned language. Telebanking facility has also been provided in Hindi and English and other 6 major regional languages. The Bank''s corporate website is in bilingual. The Bank is also giving SMSs in Hindi to all its customers on special occasions.
With effect from 1st July 2011, Bank has provided Hindi option in Core Banking System. The Bank''s bilingual address booklet ''CANPATHA'' is made available to all branches and offices in electronic form. Hindi option provided in Mobile Banking, E-Infobook and the Bank''s internet Banking portal.
To encourage effective implementation of Official Language in the Bank, 186 prizes were given to Circles, Branches, Regional Staff Training Colleges (RSTCs) and Sections of Head Office & Circle Offices under the Award Scheme formulated by the Bank under Canara Bank Rajbhasha Akshay Yojana and 148 employees were awarded under Rajbhasha Puraskar Yojana. Bank has also conducted Annual âAll India Hindi Essay Competitionâ for its employees and cash prizes were given to prize winners.
Half Yearly Hindi Journal âCanarajyotiâ - 17th & 18th issues were brought out during the year. The 17th issue was released by our MD&CEO Shri Rakesh Sharma during Hindi Day Celebration,2016 at Head Office & 18th issue was released by Prof. V R Jagannathan, Linguistic Expert & Rtd. Professor, IGNOU. Canarajyoti is brought out to encourage original writing in Hindi. This publication contains articles on banking related subjects as well as Poetry, Short Stories, Travelogues written in Hindi by employees. During the year, Canarajyoti awarded Silver Prize by ABCI under Indian Language category and awarded Bronze prize by PRCI under regional language Category.
The 34th All India Conference of OL Officers of the Bank was held at RSTC, Gurgaon on 3rd and 4th March 2017.
During the year, the Third Sub Committee ofParliamentary Committee on Official Languages had inspected the Bank''s Aurangabad Branch (under Pune Circle Office), Sirohi Branch (under Jaipur Circle Office), Kottayam Temple Road Branch (under Thiruvananthapuram Circle Office) and Head Office, Bengaluru. The Committee lauded the efforts put in by the Bank in the field of Official Language implementation. The Bank is convening the Town Official Language Implementation Committees of Agra, Coimbatore and Thiruvananthapuram. Official Language Implementation Committees are constituted in all the branches of the Bank as per the Government guidelines to propagate the progressive use of Hindi. The Bank awarded Encouragement Prize by the RBI for effective implementation of Official language in the Bank in Region ''A''.
Promotion of Sports
Canara Bank has always been encouraging and supporting sports and has contributed generously to sporting activities all over the country by sponsoring tournaments, providing scholarships to talented sports personalities. A Sports Council at Head Office was setup in the year 1982 to monitor and encourage sports activities in the Bank.
The Bank is presently having teams in 6 disciplines:
Athletics |
Women |
4 Members |
Ball Badminton |
Men |
3 Members |
Cricket |
Men |
16 Members |
Hockey |
Men |
13 Members |
Shuttle Badminton |
Men |
2 Members |
Table Tennis |
Men |
3 Members |
International Sportspersons in the Bank fold are Shri B K Venkatesh Prasad & Shri Sunil B Joshi (Cricket), Smt. M K Asha, Smt Suma Gopalakrishna (Athletics), Smt. H M Jyothi (present International Athlete), Shri P Shanmugam, Shri Bharath Kumar Chetri (Captain Indian Hockey Team, London Olympics-2012)
& Shri K M Somanna (Senior-Hockey), Shri K P Dinesh (Junior-Hockey), Shri D Guruprasad, Shri Vineet Manual (Shuttle Badminton) & Shri Nitin V Thiruvengadam (International Table Tennis Player). Some of the above sportspersons have represented the Bank in tournaments and competitions at the State and National levels.
During the year, Smt H M Jyothi secured GOLD Medals in 100 Meters, 200 Meters & 4x100 Meters Relay events in the National Inter State Senior Athletic Meet at Lucknow during September 2016. She also secured GOLD Medals in 100 Meters & 200 Meters (New State Record) the Senior State Athletic Meet held at Bengaluru, July 2016, 100 Meters event at the State Level Dasara Athletic Meet, Mysuru in October 2016 and 100 Meters
& 200 Meters GOLD Medals in the Senior State Athletic meet held at Hubballi & Dharwad, Karnataka. The Bank''s Badminton Team was the Runner-up for the State Level Ball Badminton tournament held at Alva''s in Moodbidiri, during August 2016 and winners at the State Level Ball Badminton Tournament at Chintamani during January, 2017 in Karnataka. The Cricket Team of the Bank was the Runner-up in the State Level Cricket Tournament, Mysuru, Karnataka. Shri D Guruprasad secured Bronze Medal in the All India Senior Ranking Shuttle Badminton Tournament at Kolkata and was the Runner-up in the State Ranking Shuttle Badminton Tournament, Davangere, Karnataka. Shri Nitin V Thiruvengadam was ranked 2nd in the Karnataka State Table Tennis and won all the State Ranking Tournaments. In Doubles Category, the Bank''s Table Tennis Team was ranked 1st for the year 2016-17.
Apart from the Teams at the Head Office, the Bank is also encouraging sports at the Circle levels by allotting annual budget for sports activities & also sports competition for employees, monitored by the Circle Sports Councils.
FINANCIAL SUPERMARKET
Canara Bank with an objective of offering ''One Stop Banking'' facilities for the customers forayed into diversified business activities by opening subsidiaries during late 1980s. Today, the Bank functions as a ''Financial Supermarket'', with ten Subsidiaries / Sponsored entities / Joint Ventures in diversified fields. All the Subsidiaries / Sponsored entities / Joint Ventures of the Bank recorded satisfactory performance during the year 2016-17.
CANFIN HOMES LIMITED (CFHL)
Canfin Homes Limited, a sponsored entity of Canara Bank is one of the premier housing finance entities in the country. Stake of the Bank in the Company in the beginning of the year was 43.45%. The Bank since sold 13.45% stake to a Singapore based Company M/s Caladium Investment Pte. Ltd (subsidiary of GIC Private Ltd, Singapore) for Rs,754 crore. The loans outstanding of the Company as at March 2017 was Rs,13313 crore. The Company earned a profit after tax of Rs,235.26 crore as against Rs,157.11 crore in the previous year, with y.o.y growth of 49.74%. Gross NPAs of the Company was Rs,27.91 crore and Net NPA was nil as on 31.03.2017. 100% dividend for the year 2016-17 has been proposed by the Company.
CANARA BANK SECURITIES LIMITED (CBSL)
Canara Bank Securities Limited is a wholly owned subsidiary of the Bank. The Company offers stock broking services to both institutional and retail clients. Online Trading Counter for retail customers is its flagship product and has diversified into Currency Derivatives and has a clientele base of 42,386. The Company has posted a profit after tax of ''10.53 crore and declared a dividend of 15% for the year 2016-17. CBSL has taken over the Depository Participant operations from Canara Bank with effect from 01.04.2017.
CANARA ROBECO ASSET MANAGEMENT CO LIMITED (CRAMC)
In the year 2007, Canara Bank divested 49% stake held by Canbank Mutual Fund in favour of M/s Robeco Groep N V and formed a joint venture for managing the assets under âCanara Robeco Asset Management Company Limitedâ. The Bank''s share in the JV is at 51%. Total Assets under Management was at Rs,9878 crore with investor base of 6.43 lakhs as at March 2017. The Company is currently managing 29 Mutual Fund Schemes, including Gold Exchange Traded Fund. The Company has posted a net profit of Rs,16.21 crore and declared a dividend of 10% for the year 2016-17.
CANBANK FACTORS LIMITED (CFL)
Canbank Factors Limited is a factoring Subsidiary of the Bank with 70% stake held by the Bank. During 2016-17, the Company had a total business turnover of Rs,2498 crore. The Company incurred a loss of Rs,39.82 crore due to provisioning of Rs,86.72 crore for the doubtful debts for the year 2016-17.
CANARA HSBC ORIENTAL BANK OF COMMERCE LIFE INSURANCE COMPANY LIMITED (CHOICE)
A Life Insurance Joint Venture was floated by the Bank in association with HSBC Insurance (Asia Pacific) Holding Limited and Oriental Bank of Commerce in the year 2007. The JV commenced its business operations with effect from 16.06.2008, with majority shareholding of 51% by the Canara Bank, followed by HSBC (26%) and Oriental Bank of Commerce (23%). The Company recorded new business premium of Rs,969 crore and gross premium of Rs,2295 crore during the year. The company has 3,30,717 in-force policies as on 31.03.2017. The company achieved a statutory profit of Rs,111 crore for 2016-17.
CANBANK VENTURE CAPITAL FUND LIMITED (CVCFL)
Canbank Venture Capital Fund Limited is the Trustee and Manager of Canbank Venture Capital Fund and a wholly Owned Subsidiary of the Bank. The company has managed 5 funds so far with total Asset under Management of Rs,552.78 crore. The latest fund is the Emerging India Growth Fund with a corpus of Rs,435.86 crore. CVCFL has been appointed by the Department of Electronics and Information Technology (DeitY) to manage the Electronic Development Fund (EDF) with a corpus of Rs,2206 crore with Rs,2200 crore from Govt. of India, Rs,5 crore from Canara Bank and Rs,1 crore from CVCFL. Another new fund has been named as âEmpower India Fundâ is being setup with a target corpus of Rs,650 crore. The Company recorded a profit after tax of Rs,5.02 crore and has proposed to pay a dividend of 1000% for the year 2016-17.
CANBANK COMPUTER SERVICES LIMITED (CCSL)
Canbank Computer Services Limited is the only Software Company promoted by a Public Sector Bank in the country, with a 69.13% shareholding by the Bank. CCSL is primarily engaged in IT and Software development services, BPO services, ATM/ Any Time Payment services, Training, Consultancy and R&T agent. The Company has posted a profit after tax of Rs,6.50 crore and proposed a 50% dividend for 2016-17.
CANBANK FINANCIAL SERVICES LIMITED (CANFINA)
Canbank Financial Services Limited is confining its activities to legal matter arising out of past transactions in securities and recovery of dues under decreed accounts. The Company received extension of time limit from the RBI for further period of three years up to 31.01.2020 for disposing off its assets.
COMMERCIAL INDO BANK LLC (CIBL)
Commercial Indo Bank LLC, a joint venture of Canara Bank and State Bank of India has been operational since April 2014 in Moscow, Russia. The company earned a profit after tax of US$ 5.31 million during the year.
CANARA BANK (TANZANIA) LIMITED
Canara Bank (Tanzania) Limited is wholly owned Subsidiary of the Bank at Dar es Salaam in Tanzania, registered in Tanzania on 02/11/2015 and obtained a banking license from the Bank of Tanzania on 05/05/2016. The subsidiary commenced its business operations from 09/05/2016. The company earned a profit after tax of US$ 0.17 million.
REGIONAL RURAL BANKS (RRBs)
As at March 2017, the Bank had two sponsored RRBs, viz., Kerala Gramin Bank (KGB) in Kerala and Pragathi Krishna Gramin Bank (PKGB) in Karnataka.
Kerala Gramin Bank (KGB) operates in all the 14 districts of Kerala State with 615 branches and 294 ATMs. The total business of the KGB was Rs,28816 crore as at
March 2017, comprising a total deposits of Rs,15075 crore and advances of Rs,13741 crore. Pragathi Krishna Gramin Bank (PKGB) operates in 11 districts of Eastern Karnataka with 648 branches & 270 ATMs. The total business of the PKGB was Rs,27761 crores as at March 2017 with a total deposits of Rs,15361 crore and advances of Rs,12400 crore.
Aggregate business of both the RRBs increased to Rs,56577 crore as at March 2017 with a y.o.y growth of 17.85% comprising deposits of Rs,30436 crore and advances Rs,26141 crore. Through the Bank''s infrastructure support, the RRBs are extending facilities, like, ATM cum Debit Card services and installed 564 ATMs/Cash Dispensers (294 by KGB, 270 by PKGB) as at March 2017. The sponsored RRBs are 100% CBS compliant and are ahead of their peer RRBs under technology front by extending IT based products, like, Mobile Banking, RuPay Debit Card services and also Aadhaar enabled services and remittance facilities through NEFT/RTGS to their customers. The RRBs have put in place Cheque truncation system and e-KYC technology.
Kerala Gramin Bank has received National Payments Excellence Awards, 2016, by National Payment Corporation of India (NPCI) for Excellent Performance in Cheque Truncation System (CTS) - RRB Category, Runner-up for IBA Banking Technology Awards-Technology Bank of the year, ASSOCHAM''s 4th SMEs Excellence Award, 2016, Micro Lending (Rural Sector) and Banking Excellence Award, 2016, by the State Forum of Bankers Clubs as the Best Bank contributed to the Rural Economy of the State during the year.
Pragathi Krishna Gramin Bank has been conferred SKOCH Order of Merit, SKOCH Highest Independent Honor in Financial Inclusion, SKOCH Order of Merit for Insurance, ASSOCHAM Social Banking Award-Winner Among RRBs and Co-operative Banks in the country under Priority Sector Lending to categories other than Agriculture, Best MSME Bank Award - Winner (RRB Category) and Eco-Technology Savvy Bank Award - Runner (RRB Category) for the year, 2016.
The Bank''s sponsored RRBs were the first amongst RRBs to implement e-KYC technology and Aadhaar Enabled Payment System (AEPS). Together these RRBs had done 10.82 lakh enrolments under the Social Security Schemes.
AWARDS / ACCOLADES
In recognition of the varied initiatives, the Bank was conferred with the following awards during the year 2016-17:
- National Award for Excellence - 1st position in MSE lending for 2013-14 and 2014-15 by the Government of India.
- National Award for Excellence in lending to Micro Enterprises, 1st position for 2013-14 and 2nd Position for 2014-15 by the Government of India.
- Best bank Award under PMEGP, South Zone in the field of Khadi and Village Industries for 2013-14 and 2014-15 by the Government of India.
- MSME Excellence Award, 2017, by Federation of Industrial Trade and Services.
- Skoch Award for SME Enablement, 2016.
- SME Excellence Award for Best SME lending during 2015-16 by ASSOCHAM.
- Golden Peacock Award, 2016, under CSR activities.
- CSR Leadership Awards, 2016, for best CSR practices by World CSR Congress
- Indy Wood CSR Excellence Award, 2016, for outstanding achievement in CSR by Indywood Film Carnival.
- FICCI CSR Social Responsible Bank Award under Women empowerment for 2016.
- ASSOCHAM Social Banking Excellence Awards, 2016.
- Dun & Bradstreet Award, 2016, for being the best Public Sector Bank under Priority Sector Lending and Retail Growth Performance.
- âSKOCH Order of Meritâ Award for initiatives under Financial Inclusion.
- âSKOCH ORDER OF MERITâ and âSKOCH SILVERâ Awards, 2016, for Banc assurance during 46th SKOCH Summit.
- âSpecial Award for the Best Financial Institution-Goldâ for 7th year in succession by Federation of Karnataka Chamber of Commerce & Industry (FKCCI).
- Corporate Vigilance Excellence Award, 2016-17, in Banking Sector, consecutively for the 4th year, instituted by M/s Institute of Public Enterprise.
- Star Performer Award, 2016, in the 31st Depository Participant Conference.
- First Position (Bank Category) in New Demat Accounts opened for the 4th consecutive year by NSDL.
- MasterCard Innovation Award for Canara International Travel Prepaid Card under Prepaid segment.
- RuPay Special Award for being the highest RuPay Card Issuing Bank by NPCI.
- Visa Award on crossing a key milestone on issuance of 1.35 crore Visa Debit Cards.
- Best Strategy in HR & Training Excellence - Gold Awards, in 6th Annual Greentech HR Award 2016.
- 2 Silver Awards for House Magazine, âShreyasâ, special column (English) by the Association of Business Communications of India, 2016.
- 7 Awards (Collateral Awards Category) at 11th Global Communication Conclave held by Public Relation Council of India.
VARIOUS POLICIES OF THE BANK
There is a system of well-defined policies and procedures of the Bank. During the year, concerted efforts were made to streamline the policies and procedures of the Bank in the light of regulatory requirements of the RBI, the directions of the Government of India and the emergent requirements of the Bank in the present day context. Accordingly, there has been a sharper focus on policies relating to, among others, Credit Risk Management, Market Risk Management, Operational Risk Management, Asset Liability Management, Liquidity Risk Management, Group Risk Management, Country Risk, Counterparty Bank Risk, Corporate Governance,
Disclosures, Collateral Management, Stress Testing, Compliance Functions, Disaster Recovery and Business Continuity Planning, Business Lines, Outsourcing and ICAAP, KYC, AML, Recovery and Investments.
CHANGES IN THE BOARD OF DIRECTORS
Year 2016-17 saw the following changes in the composition of the Board of Directors of the Bank.
Tenure of the following Directors on the Board of the Bank ended during the period.
Changes in the Bankâs Board of Directors during the year 2016- 17
Name of the Director |
Designation |
Date of Appointment |
Date of Cessation |
Shri Pankaj Jain |
GOI Nominee Director |
14.12.2015 |
01.05.2016 |
Shri Pradyuman Singh Rawat |
Executive Director |
05.08.2013 |
31.05.2016 |
Shri Suchindra Misra |
GOI Nominee Director |
14.06.2016 |
Until further Orders |
Shri Rajinder Kumar Goel |
Shareholder Director |
27.07.2013 |
26.07.2016 |
Shri Sanjay Jain |
Shareholder Director |
27.07.2013 |
26.07.2016 |
Shri Krishnamurthy H |
Shareholder Director |
27.07.2016 |
Tenure on the Board ending on 26.07.2019 |
Shri Mahadev Nagendra Rao |
Shareholder Director |
27.07.2016 |
Tenure on the Board ending on 26.07.2019 |
Shri Venkatachalam Ramakrishna Iyer |
Shareholder Director |
27.07.2016 |
Tenure on the Board ending on 26.07.2019 |
Smt. P.V. Bharathi |
Executive Director |
15.09.2016 |
Tenure on the Board ending on 14.09.2019 |
Shri Sairam Mocherla |
Part Time Non Official Director |
05.12.2013 |
04.12.2016 |
Shri Sunil |
Non Official |
||
Hukumchand |
Director - CA |
06.12.2013 |
05.12.2016 |
Kocheta |
Category |
||
Other than |
|||
Shri G.V. Manimaran |
Workmen |
||
Represen tative Director |
03.01.2014 |
02.01.2017 |
Brief Profile of the newly appointed Directors of the Board of the Bank during 2016-17
Shri Suchindra Misra, currently the Government of India nominee Director, was nominated to the Board on 14th June, 2016. He holds a Bachelor''s Degree in Science and a Postgraduate Diploma in Business Management in Marketing & Finance. He is the Joint Secretary at the Department of Financial Services, Ministry of Finance, Government of India.
Shri Krishnamurthy H, currently the Shareholder Director, was appointed to the Board on 27th July, 2016. He holds a Master''s Degree in Engineering and is the Chief Research Scientist at the Indian Institute of Science, Bengaluru. His areas of interest include banking technologies, communications and networking in particular.
Shri Mahadev Nagendra Rao, currently the Shareholder Director, was appointed to the Board on 27th July, 2016. He holds a Master''s Degree in Physics and is a Certified Associate of the Indian Institute of Bankers. Shri Mahadev Nagendra Rao is a retired Deputy Managing Director of State Bank of India and also previously held the positions of a nominee Director in various subsidiaries of State Bank of India as well as worked as the Managing Director and Chief Executive Officer of SBI Life Insurance Company Limited. He is also a Director on the Board of IDBI Federal Life Insurance Co. Ltd.
Shri Venkatachalam Ramakrishna Iyer, currently the Shareholder Director, was appointed to the Board on 27th July 2016. He holds a Bachelor''s Degree in Science and is a Certified Associate of the Indian Institute of Bankers and is a retired Deputy Managing Director of State Bank of India. Previously he was the nominee Director on the Boards of SBI General Insurance Company Limited and SBI Global Factors Private Limited. He is a nominee Director of SBI in Usha Martin Limited, Kolkata.
Smt. P V Bharathi, who was the General Manager of the Bank, took charge as an Executive Director of the Bank on 15th September, 2016. She holds a Postgraduate Degree in Arts and a Bachelor''s Degree in Science and
Education. Spanning over 3 decades of multi-dimensional banking exposures, Smt. Bharathi carries with her rich and vast experience. She has worked in the Bank''s rural, semi-urban, urban and metropolitan branches, in addition to administrative offices in various capacities. Additionally, she is a certified associate of the Indian Institute of Bankers.
DIRECTORSâ RESPONSIBILITY STATEMENT
The Directors, in preparation of the annual accounts for the year ended March 31, 2017, confirm the following:
- That in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.
- That they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit or loss of the Bank for the period.
- That they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of applicable laws governing banks in India for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities.
- That they had prepared the annual accounts on a going concern basis.
ACKNOWLEDGEMENT
The Board wishes to place on record its sincere appreciation to the customers for their patronage, to the shareholders for their support, to the Government authorities and the Reserve Bank of India for their valuable guidance and support, to the Directors who completed their tenure during the financial year under review, to the Bank''s Correspondents in India and abroad for their co-operation and goodwill and to all the Staff Members for their full support in the pursuit of organizational growth and excellence.
RAKESH SHARMA
MANAGING DIRECTOR & CEO
Mar 31, 2013
The Board of Directors have pleasure in presenting the 44th Annual
Report together with the Balance Sheet as on 31st March, 2013 and
Profit and Loss Account for the financial year ended March 31, 2013.
FINANCIAL PERFORMANCE
During the year, the Bank took a conscious decision to de-risk the
balance sheet by shedding a substantial portion of bulk business both
on high cost, including Certificate of Deposits as well as short term
unsecured corporate loans. The performance of the Bank on the business,
profits and profitability fronts are as under.
The Bank earned a net profit of Rs.2872 crore for 2012-13 compared to
Rs.3283 crore last year. Operating profit of the Bank stood at Rs.5890
crore compared to Rs.5943 crore last year. Return on average assets
(RoAA) for the year stood at 0.77%. Profit per employee worked out to
Rs.6.96 lakh for the year.
Enhancing Shareholders'' Value
Dividend of 130% for 2012-13
The Bank''s Board of Directors recommended a dividend of 130% for
2012-13 as against 110% last year. While Book Value increased to
Rs.490.56 as at March 2013 compared to Rs.429.51 for the previous
financial, EPS stood at Rs.64.83 as at March 2013. Return on Equity
stood at 14.03% for 2012-13.
March March
Key Financial Ratios (%) 2012 2013
Cost of Funds 6.72 6.96
Yield on Funds 8.95 9.05
Cost of Deposits 7.35 7.72
Yield on Advances 10.93 11.13
Yield on Investments 7.96 8.12
Spread as a % to AWF 2.23 2.09
Net Interest Margin (NIM) 2.50 2.40
Operating Expenses to AWF 1.35 1.37
Return on Avg. Assets (RoAA) 0.95 0.77
Return on Equity 18.75 14.03
Business per Employee 13.74 14.20
(Rs. in Crore)
Profit per Employee 8.21 6.96
(Rs.in Lakh)
Book Value (Rs.) 429.51 490.56
Earnings per Share (Rs.) 74.10 64.83
AWF - Average Working Funds
Income and Expenditure Analysis
The Bank''s interest income recorded a y-o-y growth of 10.5% to reach
Rs.34078 crore compared to Rs.30851 crore recorded during the previous
financial year. Non-interest income increased to Rs.3153 crore
compared to Rs.2928 crore recorded last year.
The Bank''s cost of deposits increased to 7.72% due to high interest
rates prevailing during the year. The yield on advances improved to
11.13% as at March 2013 compared to 10.93% last year. Interest spread
stood at 2.09% compared to 2.23% as at March 2012.
While interest expenditure increased to Rs.26199 crore with a y-o-y
increase of 13%, the Bank contained its increase in operating expenses
at 10% amounting to Rs.5142 crore. The net interest income of the Bank
stood at Rs.7879 crore and Net
Interest Margin (NIM) worked out at 2.40%.
Capital and Reserves
Networth of the Bank, as at March 2013 increased to Rs.21732 crore
compared to Rs.19027 crore as at March 2012. While total paid-up
capital of the Bank was Rs.443 crore, reserves and surplus increased to
Rs.24435 crore. The Government Shareholding in the Bank stood at 67.72%
as at March 2013.
(Amt. in Rs. crore)
Composition of Capital March 2012 March 2013
Risk Weighted Assets 210875 243348
Tier I Capital 21829 23776
CRAR (%)(Tier I) 10.35 9.77
Tier II Capital 7179 6388
CRAR (%)(Tier II) 3.41 2.63
Total Capital 29008 30164
CRAR (%) 13.76 12.40
Capital Adequacy Ratio stood at 12.40%, with Tier I capital ratio at
9.77% as at March 2013. The Bank has adequate headroom available under
both Tier-I and Tier-II options to raise capital to support business
growth momentum.
BUSINESS GROWTH
Deposits
Total Deposits of the Bank registered a growth of 8.8% to reach
Rs.355856 crore as at March 2013 compared to Rs.327054 crore a year
ago. During the year, the Bank shed about Rs.74500 crore of high cost
deposits, including Certificate of Deposits. As a result, the share of
high cost bulk deposits including CDs came down from 45% as at March
2012 to 20% as at March 2013.
The Bank''s CASA deposits reached Rs.86061 crore as at March 2013. The
Bank''s CASA deposits to domestic deposits stood at 25.12%. Savings
deposits rose by 9.8% to Rs.71168 crore as at March 2013. During FY13,
the Bank launched nationwide campaigns to mobilize CASA deposits.
During the campaign period, the Bank brought in about 30 lakh fresh
CASA clientele and about Rs.6100 crore CASA deposits in the new
accounts.
Pursuing a strategy of broad-basing deposit clientele, all the branches
together added 42 lakh deposit accounts, taking the total number of
deposit accounts to 4.17 crore.
Advances (Net)
During the year, the Bank''s net advances reached Rs.242177 crore
compared to Rs.232490 crore a year ago. The moderate growth in advances
was due to shedding of bulk advances viz., short term unsecured
corporate loans amounting to Rs.22000 crore.
The Bank''s diversified credit portfolio include all productive segments
of the economy like agriculture and Micro, Small and Medium Enterprises
(MSME), exposure to corporates and infrastructure segments. As at March
2013, the number of borrowal accounts increased to 53 lakh from 45 lakh
last year.
Productivity, as measured by business per employee, increased to
Rs.14.20 crore from Rs.13.74 crore a year ago. During the year, the
Bank''s total clientele base increased to 4.7 crore from 4.2 crore last
year.
Retail Lending Operations
Outstanding retail lending of the Bank reached Rs.23084 crore as at
March 2013. The disbursals under the retail lending stood at Rs.8710
crore. The outstanding housing loan portfolio stood at Rs.13134 crore,
constituting 57% of the total retail lending portfolio. The Bank''s
advances under Housing Loan (direct) increased to Rs.8688 crore.
The Bank took several measures during the year to expand retail credit.
The Bank introduced new retail loan products, viz., Canara Home Loan
Plus, Canara Consumer Loan and Canara Loan against Property. Two
Central Processing Units (CPUs) at Bhopal and Ludhiana were upgraded as
Retail Asset Hubs, taking the total tally under Retail Asset Hubs to 42
and 3 CPUs at major centres across the country.
Education Loans
Over the years, the Bank has supported lakhs of promising students to
pursue higher education in India and abroad. The Bank''s education loan
portfolio increased to Rs.4343 crore. The Bank has financed more than
2.17 lakh students as at March 2013. The Bank is designated as the
nodal bank for administering subsidy under the Central Sector Scheme
for Interest Subsidy on education loans.
TREASURY
Aggregate investments (net) of the Bank was at Rs.121133 crore as at
March 2013. Portfolio modified duration increased to 4.73 years from
4.62 years as at March 2012. The modified duration of the Available
for Sale (AFS) portfolio increased to 4.16 years as at March 2013 from
3.23 years as at March 2012 due to redemption of short dated securities
and fresh investments made in medium and long dated securities. The
trading profit for the year was Rs.676 crore as against Rs.324 crore
last year. The yield on investments improved to 8.12% compared to 7.96%
a year ago.
The Bank continues to be an active player in Government Securities as a
primary dealer. The total amount of bids submitted for underwriting was
Rs.107103 crore, of which, the underwriting commitment accepted by the
RBI was Rs.69347 crore. During the second half year, the Bank achieved
51.84% success ratio as against minimum success ratio of 40% of its
obligation as a Primary Dealer.
Foreign Business Turnover of the Bank aggregated to Rs.143795 crore,
comprising Rs.54328 crore under exports, Rs.40391 crore under imports
and Rs.49076 crore under remittances as at March 2013. Outstanding
export credit of the Bank stood at Rs.10067 crore as at March 2013.
INTERNATIONAL OPERATIONS
The Bank''s overseas operations covered 6 countries with one branch each
at London and Leicester (UK), Hong Kong, Shanghai (China) and Manama
(Bahrain), a Representative Office at Sharjah (UAE) and a joint venture
Bank, namely, Commercial Bank of India LLC in Moscow in association
with State Bank of India.
All overseas branches recorded improved business performance during the
year. Total business of the five overseas branches aggregated to
Rs.28786 crore for the financial year ending March 2013, constituting
4.8% of the Bank''s total business.
The Bank has approval from RBI for expansion in 9 other international
centres, namely, Qatar Financial Centre (Qatar), Johannesburg (South
Africa), Frankfurt (Germany), New York (USA), Sao Paulo (Brazil),
Dar-es- Salaam (Tanzania), Tokyo (Japan), Abuja (Nigeria) and Jeddah
(Saudi Arabia). In this regard, the Bank has filed application with
regulators of Qatar, Germany and USA. The Bank has already received
consent from South African Reserve Bank for opening a branch at
Johannesburg.
The Bank''s international operations are well supported by a wide
network of 373 Correspondent Banks, spread across 79 countries. Rupee
Drawing Arrangement has been made with 30 Exchange Houses and 16
Overseas Banks in the Middle East for channelizing the remittances of
Non-Resident Indians. The Bank has been managing two Exchange Houses
viz., Al Razouki International Exchange Company, Dubai and Eastern
Exchange Est., Qatar under Secondment and Management Agreement
respectively.
''Remit Money'', a Web Based Speed Remittance product has been extended
to 29 Exchange Houses and to 4 overseas branches, viz., London,
Leicester, Shanghai and Hong Kong. During the year, the Bank has
approved arrangements under Remit Money with three more Exchange Houses
in UAE.
OTHER SERVICES
The Bank''s Merchant Banking Division handled Private Placement Capital
Gain Bond Issues of National Highways Authority of India (NHAI) and
Rural Electrification Corporation Ltd (REC) as Arrangers. The amount
mobilized in respect of Capital Gain Bonds Issue of NHAI and REC during
the year was Rs.83.95 crore. Seven specialized assignments of ''Fair
Valuation of Equity'' were also handled by the Division during the year.
The Bank acted as Collecting Banker for 3 Private Placement Issues,
involving an amount of Rs.1285.78 crore. The number of Public and Debt
Issues handled under Application Supported by Blocked Amount (ASBA) by
designated Branches was 30 and the amount blocked was Rs.44.12 crore.
The number of designated Branches under ASBA increased from 152 to 1874
as at March 2013.
The Syndication Group handled projects, involving project cost of
Rs.3283 crore during the year, with a total debt size of Rs.2257 crore.
The Group generated fee-based income from the syndication operations.
The funds are arranged for projects in various segments like Road,
Sugar, Metrorail, etc.
The Bank has tie-up arrangements in both life and non- life insurance
segments under its ''Bancassurance'' arm. The Bank earned a
commission income of Rs.25.90 crore from its joint venture viz., Canara
HSBC OBC Life Insurance Company Ltd. Under the Mutual Fund business,
the Bank earned a commission of Rs.4.95 crore from its joint venture
viz., Canara Robeco Asset Management Company Ltd. The Bank''s tie-up
arrangement with M/s United India Insurance Company Ltd (UIICL) for
Non-Life (General) Insurance business has resulted in a commission
income of Rs.11.92 crore during the year. The Bank has also Corporate
Agency Agreement with M/s Export Credit Guarantee Corporation of India
for marketing export policies through its branches across India.
Under Card Business, the Bank took several initiatives to expand credit
and debit-cum-ATM card base. The total debit card base of the Bank
increased to 95.53 lakh as at March 2013. Income under card business
during the year was at Rs.131 crore.
The Bank offers its Depository Services from 46 DP Service Centres
spread across 36 centres in the country. Through these Centres, the
Bank is extending Online Trading Facility to DP clients from its own
broking subsidiary M/s Canara Bank Securities Limited, Mumbai.
Executor, Trustee and Taxation Services outfit of the Bank provides
services like Debenture/Security Trusteeship, Will and Executorship,
Trusteeship, Personal Tax Assistance and Power of Attorney Services.
During the year, it generated fee based income of Rs.1.52 crore.
Under Government Business, comprising Direct and Indirect Tax
collections, payment of pensions of various departments, Ministry
Accounts, Postal Department, Public Provident Fund Scheme and issue of
bonds of RBI and Government of India, the Bank earned an income of
Rs.72.43 crore during the year.
The Bank has been authorized as the accredited banker for Ministry of
Human Resources Development (MHRD), handling Department of School
Education and Literacy, Department of Higher Education, Department of
Arts - Archeological Survey of India, Ministry of Culture and Ministry
of Youth Affairs and Sports. The Bank has developed a Web-Portal for
Ministry of HRD for e-tracking of funds under the Sarva Shiksha Abhiyan
(SSA) Scheme and implemented the web portal in all the States. The Bank
has implemented E-payment of Sales Tax/ Commercial Tax in Maharashtra,
Tamil Nadu, Karnataka, Andhra Pradesh, Bihar and Delhi, Virtual
Treasury Package in Maharashtra, E-Payment of Taxes to Transport
Department in Tamilnadu and Collection of Property Tax for the
Corporation of Chennai in Tamilnadu. The Bank has also introduced
E-challans/Scrolls for CPPC Package and acceptance of online
subscription for NPS.
The Bank is authorized as one of the accredited Bankers for Unique
Identification Authority of India (UIDAI), New Delhi. The UIDAI was
established in February 2010, as an agency of Government of India,
responsible for implementing the Multipurpose National Identity Card or
Unique Identification Card (UID Card) project in India. The project is
implemented in 8 Centres at present and the Bank''s branches at these
Centres have been designated as the branches for handling the UIDAI
accounts.
During the year, the Bank has entered into a MoU with Ministry of HRD
for implementing Maulana Azad National Fellowship, 6 UGC Scholarship
Schemes and National Scheme of Incentives to Girls for Secondary
Education (NSIGSE).
The Bank has implemented E-payment of Customs in 103 locations as per
the direction of the Central Board of Excise and Customs, New Delhi,
with effect from 16.01.2012.
E-stamping project is introduced in 10 branches in Bangalore. The
project is under implementation at other 26 branches situated in the
District Head Quarters in the State of Karnataka.
Agricultural Consultancy Services (ACS) outfit of the Bank handled 86
assignments. These 86 assignments consisted of 42 appraisals, 10
viability studies, 27 vettings and 7 other studies and trainings. The
total outlay of the assignments works out to a term loan component of
Rs.709 crore and non-interest income derived by the Bank in the form of
processing fee was Rs.7.09 crore.
ASSET QUALITY AND RISK MANAGEMENT All Time High Cash Recovery at
Rs.4006 crore
Asset Quality
The Bank has performed well in containing Non-performing Assets (NPA)
and made record cash recoveries. The gross NPA level of the Bank stood
at Rs.6260 crore, with a gross NPA ratio at 2.57% as at March 2013. The
Bank''s gross NPA ratio continues to be one of the lowest among peers.
With a Net NPA level of Rs.5278 crore, the net NPA ratio was at 2.18%.
Cash Recovery during FY13 aggregated to a record Rs.4006 crore compared
to Rs.3296 crore for FY12. Out of this, recovery from written off
accounts at branches, write- back and unapplied interest together
amounted to Rs.1488 crore.
During the year, recovery amounting to Rs.1560 crore was made under
SARFAESI Act. The Bank conducted 22500 recovery meets, which resulted
in a recovery of Rs.1250 crore. Under Lokadalat, 820 cases were settled
covering Rs.14.50 crore. During the year, an amount of Rs.851 crore was
upgraded on account of recovery/ rehabilitation. Besides, the Bank took
several initiatives to contain slippages and speed up recovery from
overdue loan accounts. These include identification of stressed
accounts for restructuring/rephasing in time, conduct of Canadalats at
branch level and mega adalats at Circle level for one time settlements,
regular follow- up of overdues in loan accounts through Call Centre and
e-auctions. The Bank also formulated a special scheme for settlement of
small NPAs and for MSMEs below Rs.1 crore.
Risk Management
Capital Adequacy Framework and Future Strategies
An Independent Risk Management Wing at the Head Office is functioning
as a nodal centre for overall implementation of various risk management
initiatives across the Bank. Integrated Mid-Office (Domestic and
ForexTreasury) is functioning under the Risk Management Wing for
effective and independent supervision and monitoring of Market Risk in
investment and forex functions. Risk Management Sections are
functioning at all the 34 Circle Offices of the Bank as an extended arm
of the Risk Management Wing.
The Bank has in place Risk Management Policies across geographies and
across all risks encompassing the entire gamut of risk profile. These
include policies on Credit Risk Management, Market Risk Management and
Operational Risk Management.
An Internal Capital Adequacy Assessment Process (ICAAP) under Pillar 2
of Basel II Norms is in place. The ICAAP exercise covers the domestic,
overseas operations of the Bank, the subsidiaries, sponsored entities
and associates. Linkages to Stress Test Scenarios are also documented
in ICAAP The ICAAP document is reviewed and approved by the Risk
Management Committee of the Board and the Board of Directors.
A Capital Planning Committee is operational at Head Office and this
Committee articulates the macro economic scenarios vis-a-vis the
Capital requirements of the Bank in tune with business strategies. The
Committee ensures maintenance of appropriate level of CRAR and
evaluates various options for raising Capital.
Adoption of Advanced Approaches under Basel II
In the Bank''s endeavor to move towards Advanced Approaches under Basel
II for computation of Capital for Credit, Market and Operational Risk,
the service of a Consultant for implementation of Enterprise Wide
Integrated Risk Management solution in the Bank and its Group Entities
is engaged to provide assistance to the Bank in building the requisite
risk management framework.
The Bank has submitted Letter ofIntent to RBI for adoption of Internal
Rating Based (IRB) Approach for calculation of capital charge for
Credit Risk and applications for moving over to advanced approaches for
Market Risk and Operational Risk shall be submitted in a phased manner.
Preparedness for Basel III
In response to Basel Committee on Banking Supervision (BCBS)
guidelines, RBI issued the Basel III guidelines on May 2, 2012. The
final guidelines on Basel III Capital Regulations is effective from 1st
April, 2013 in a phased manner. As per RBI guidelines, with full
implementation of Basel III guidelines by March 31, 2018, banks in
India need to maintain a minimum Common Equity Tier 1 (CET1) capital of
5.50%, Tier 1 capital of 7.00%, total capital of 9.00% and Capital
Conservation Buffer (CCB) of 2.50%. Banks also have to maintain a
minimum Tier 1 Leverage Ratio of 4.5% during parallel run from 1st
January, 2013 to 1st January, 2017, as a credible supplementary measure
to the risk based capital requirements.
As per Bank''s internal estimate carried out to assess the impact of
Basel III, the Bank shall remain adequately capitalized with CET 1 &
Tier 1 capital well above the stipulated requirement. Also, sufficient
headroom is available with the Bank to raise the capital in case of any
shortfall in future.
With the quantum and quality of capital that the Bank is having in its
books, it is expected that the transition to Basel III regime would be
met without any difficulty upto FY 2014. Moving ahead, the Bank''s
capital requirement shall be met by injecting fresh equity capital,
retention of profit, optimization of business levers and proactive
capital planning and management.
Credit Risk Management
The Bank has various risk management systems for managing Credit Risk
with comprehensive policies and procedures in place.
- Pricing based on credit risk rating.
- Entry barriers fixed based on risk rating.
- Credit sanctioning powers are delegated to various authorities
based on internal risk rating of the borrowers.
- Committee approach for credit sanctioning beyond branch powers have
been introduced.
- An exclusive Credit monitoring policy has been put in place. The
loan review mechanism articulated in the Credit Monitoring Policy
covers the entire gamut of review and monitoring to be an effective
tool for evaluating the loan book continuously and intends to bring out
qualitative improvements in credit administration including Credit
Audit duly administered by the Credit Administration & Monitoring Wing.
Market Risk Management
The Market Risk framework of the Bank aims at maximizing the return by
providing inputs regarding the extent of market risk exposures, the
performance of portfolios vis-a-vis the risk exposure and comparable
benchmarks.
Integrated Mid-Office at Risk Management Wing is monitoring Market Risk
Exposure. Exposure limits, such as, Stop Loss Limits on trading book,
Intraday and overnight limit for various currency positions, Dealer-
wise limits, Aggregate Gap Limit, Limits on Money Market Operations,
Modified-duration limits for Investment portfolio and VaR limits are
fixed to act as risk mitigants/ triggers. These limits along with other
triggers are tracked daily and necessary actions are initiated.
Reporting system is strengthened for effective Market Risk Management.
Operational Risk Management
Operational Risk Management framework in the Bank is based on ethics,
organization culture and strong operating procedures, involving
corporate values, internal control culture, effective internal
reporting and contingency planning.
The Bank has adopted polices for management of Operational Risk, which
covers various aspects, such as, Operational Risk Management Structure,
Outsourcing Activities, Business Continuity Plan, Insurance and Legal
Risks.
At present, the Bank is in the process of migration to Advanced
Approaches of Basel II framework from Basic Indicator Approach (BIA).
The Bank has initiated process/ activities for implementation of
Advanced Approaches.
Asset Liability Management
An effective Asset Liability Management (ALM) system, addresses issues
related to liquidity and interest rate risks in order to maintain a
good balance among spreads, profitability and long-term viability. The
Board of Directors of the Bank has constituted an Asset Liability
Management Committee (ALCO) to oversee ALM functions, including
fixation of interest rates for various components of assets and
liabilities, its composition, maturity and duration.
Group Risk
The Bank has various Subsidiaries, Joint Ventures and Sponsored
Entities, which are engaged in diversified activities. As the Bank has
considerable stake in these Group Entities, it has adopted a Group Risk
Management Policy to identify and manage risk in Intra-Group
transactions and exposures, to raise the standard of Corporate
Governance by reducing / avoiding conflicts of interest between the
Group Entities and to ensure ''Arms Length Principle'' among the entities
in regard to business parameters.
NATIONAL PRIORITIES Priority Sector Advances
The Bank continues to accord importance to varied goals under national
priorities, including agriculture, micro & small enterprises,
education, housing, micro- credit, weaker sections, SC/STs and
specified minority communities.
Priority Sector Advances of the Bank as at March 2013 reached Rs.78998
crore, covering over 48 lakh borrowers.
(Amt. in Rs.Crore)
Priority Sector As at March Growth
Advances 2012 2013 Amount %
Total Priority Sector 67383 78998 11615 17.24
Agriculture 31946 40786 8840 27.67
Direct Agriculture 27848 37984 10136 36.40
With a focus on credit delivery to agriculture, the Bank''s advances
under agriculture portfolio increased to Rs.40786 crore, covering over
40 lakh farmers and achievied 18.22% of ANBC, surpassing the mandatory
target of 18%.
Advances under Direct Agriculture stood at Rs.37984 crore. The major
accretion under Agriculture was under Direct Agriculture lending. The
Bank crossed the mandated level of 13.50% of ANBC, by reaching 16.97%.
Advances to Direct Agriculture increased by Rs.10136 crore, showing a
growth rate of 36.4%. The Bank undertook special campaigns for
extending Crop Loans/General Credit Cards (GCCs) facility to all
farmers/non-farmers.
The Bank disbursed Rs.33730 crore under Agriculture, covering 35.96
lakh farmers during the financial year, registering an increase of
23.4%.
Since inception of the Scheme, the Bank has issued a total of 41.27
lakh Kisan Credit Cards (KCCs), amounting to Rs.26524 crore. During the
year, the Bank disbursed 3.90 lakh KCCs, amounting to Rs.4826 crore. As
at March 2013, the credit outstanding under KCCs was Rs.5969 crore. The
Bank has issued more than one lakh new KCCs RuPay debit cards (ATM) to
all eligible farmers.
During the year, the Bank also extended financial assistance to other
priority sectors, such as, state sponsored organization for SC/ST,
housing and micro credit.
The Bank actively participated in various Government Sponsored Schemes,
such as, Prime Minister''s Employment Guarantee Programme (PMEGP),
Swarnajayanthi Gram Swarozgar Yojana (SGSY), Swarnajayanthi Shahri
Rozgar Yojana (SJSRY) and Differential Rate of Interest (DRI) Scheme.
Advances to DRI stood at Rs.66.89 crore, consisting of 57232
beneficiaries, of which advances by rural and semi-urban branches
constitute Rs.46.43 crore.
As at March 2013, the outstanding advances under the following Schemes
aggregated to Rs.652 crore, involving 1.33 lakh beneficiaries.
Performance under various Government Sponsored Schemes
Name of the Scheme No. of Accounts Amt. in Rs.Crore
PMRY 21088 148.77
PMEGP 5857 163.32
SGSY 35518 196.36
SJSRY 13150 75.61
SLRS 195 1.25
DRI 57232 66.89
Total 133040 652.20
In support of the underprivileged sections of the society, the Bank''s
advances to SC/ST beneficiaries reached Rs.5179 crore as at March 2013,
covering 5.31 lakh borrowers. The advances to SC/ST comprised 6.56% of
total priority sector advances.
Advances to weaker sections aggregated to Rs.26244 crore, with a y-o-y
growth of 17.5%. Advances to weaker sections formed 11.73% of ANBC
against the norm of 10%.
Various components of Advances to Weaker Sections as at March 2013 is
as under:
(Amt. in Rs. crore)
Sectors Outstanding
Small & Marginal Farmers, Landless Labourers,
Tenant Farmers and Share Croppers 22050.00
Artisans, Village and Cottage Industries 646.57
SC/ST Beneficiaries 5178.97
DRI Loans 66.89
SGSY Beneficiaries 196.36
SJSRY Beneficiaries 75.61
SHGs/NGOs/MFIs 1331.42
Advances to SLRS 1.25
As at March 2013, advances to specified minority communities aggregated
to Rs.14369 crore, accounting for 18.19% of the total priority sector
advances against the stipulated level of 15%.
MSME Lending
Advances to Micro, Small and Medium Enterprises (MSMEs) reached
Rs.37016 crore as at March 2013. The Bank has covered 73083 accounts
with a loan amount of Rs.2528 crore as at March 2013 under the Credit
Guarantee Scheme of Credit Guarantee Fund Trust for Micro and Small
Enterprises (CGTMSE).
Considering the importance attached to MSME sector, the Bank opened
additional 7 SME Sulabhs, i.e., Centralized Loan Processing Units for
faster clearance of loan proposals and opened 21 Specialized SME
branches during 2012-13. As at March 2013, the Bank had 41 SME Sulabhs
across the country. Further, the Bank formulated six area/ cluster
specific schemes for exclusive lending under MSME sector. The Bank
effected substantial reduction in interest rates varying from 0.25% to
2.50% and also reduced interest rate by 0.25% for loans upto Rs.100
lakh covered under CGTMSE Scheme. Women entrepreneurs are offered loans
upto Rs.5 lakh at base rate and also interest concession is available
for all other loans availed by them. The Bank also entered into MoU
with BRICKWORKS India, CARE, CRISIL, ICRA and SMERA for rating of MSME
units.
The Bank received an amount of Rs.20.82 crore from the Ministry of
Micro, Small and Medium Enterprises, Government of India, during the
year as a Nodal Agency for Technology Upgradation of SMEs under Credit
Linked Capital Subsidy Scheme (CLCSS) and fully released the amount
during the year.
Financial Inclusion
A Complete Solution for Financial Inclusion
With the basic objective of bringing the large unserved population
under the banking mainstream, the Bank is striving towards a more
inclusive growth by making financial products and services available to
the poor in particular. As per the Government of India and the Reserve
Bank of India directions, the Bank has been actively pursuing the
agenda of Financial Inclusion (FI), with key interventions in four
groups, viz., expanding banking infrastructure, offering appropriate
financial products, making extensive and intensive use of technology
and through advocacy and stakeholder participation.
The Bank has successfully covered all the allotted 1624 villages
(spread across 24 States) with population above 2000 for providing
banking facilities. After ensuring coverage of villages in the more
than 2000 population category, the Bank has covered 1255 villages in
the less than 2000 population category.
Further, 5867 villages (465 villages with 1600-2000 population, 1324
villages with 1000-1599 population and 4078 villages with less than
1000 population) and 150 Wards in urban centres have been allotted for
providing banking services during the next three years.
During the year, the Bank added 64 branches in financial inclusion
villages, taking the total tally of FI branches to 275 under branch
model. During the last two years, 50% of the new branches opened are
located in FI villages. The Bank has engaged 1426 Business
Correspondents Agents (BCAs) under Business Correspondents (BC) model.
Considering the need for close supervision and mentoring of BCAs and in
order to ensure that a range of banking services are available to
residents of villages, the Bank has set up 542 Ultra Small Branches, of
which, one has already been upgraded to a regular branch.
Business canvassed in the new FI Branches
During 2012-13, the Bank opened 64 branches in FI villages, forming 50%
ofthe total 128 branches opened as against RBI stipulation of 25% of
new branches required to be opened in tier V and VI centres. 235
branches opened in the FI villages during FY12 and FY13 have shown good
results with more than 8.37 lakh accounts and Rs.1399 crore business,
working out to an average of 3562 accounts and Rs.5.95 crore business
per branch.
Position of Basic Savings Bank Accounts
The Bank opened about 17.31 lakh Basic Savings Bank (BSB) accounts
during the year, of which, 8.12 lakh BSB accounts were opened in FI
villages. There was an accretion of Rs.323 crore in BSB accounts during
the year. As at March 2013, the total number of BSB accounts stood at
60.55 lakh with total deposits of Rs.1143 crore.
One Family One Account Campaign
Under "One Family One Account" Scheme, out of 10883 service area
villages, Campaign is completed in 9966 villages (92%) and Certificates
are obtained in 80% of the villages.
Information and Communication Technology (ICT) Model
The Bank issued Smart Cards to 3.48 lakh customers. During the year,
3.40 lakh transactions involving an amount of Rs.35.15 crore were done
through Smart Cards.
Micro Insurance
During the year, the Bank provided life coverage to 31117 group members
under Micro Insurance Policy and 51185 group members cumulatively.
Electronic Benefit Transfer (EBT)
The Bank has taken up implementation of EBT for payment of MGNREGA
wages and Social Security Pension (SSP) in Chitradurga, Bellary,
Gulbarga and Yadgir districts in Karnataka. In Tamil Nadu, the Bank
implemented EBT for the payment of SSP.
Micro Finance Branches
The Bank has opened 19 Micro Finance Branches in urban centres, which
contributed a total business of Rs.211 crore.
Financial Literacy Centres (FLCs)
The Bank has set up FLCs in 26 Lead Districts and provided financial
education to 38153 persons and conducted financial literacy programmes
for children studying in government schools, using Tablet PC.
Farmers'' Clubs
During FY13, 123 farmers'' clubs were formed, taking the total tally to
1500 spread all over the country. These farmers'' clubs disseminate
information to the rural people about the banking products and advanced
technology.
Canara Gramin Vikas Vahini
The Bank has provided Canara Gramin Vikas Vahini Vehicles in 35
Districts across the country, with an objective of providing awareness
about bank''s products and banking facilities among the rural
households.
Biometric ATMs
The Bank has installed 29 biometric ATMs as at March 2013. These
biometric ATMs enable the rural illiterate customers to access their
accounts using biometric features like finger prints and withdraw the
amount or get balance confirmation, using color codes.
Credit Linkage
Besides opening BSB accounts, the Bank endeavored to provide host of
other facilities like In-Built Overdrafts (IODs), Kisan Credit Cards
(KCCs), General Credit Cards (GCCs), Differential Rate of Interest
Scheme (DRI), Self Help Groups (SHGs), Micro Credit Groups (MCGs),
Micro Insurance and Micro Pension under Canara Nayee Disha Scheme.
- IOD - In built OD facility permitted to 13621 beneficiaries,
amounting to Rs.466 lakh.
- GCC - During the year, the Bank issued 1.24 lakh GCCs, with total
disbursement of Rs.276 crore. GCCs outstanding at the end of year was
2.85 lakh accounts, with balance of Rs.600 crore.
- KCC- During the year, the Bank issued 3.90 lakh KCCs, with total
disbursement of Rs.4826 crore. KCCs outstanding at the end of year was
6.14 lakh accounts, with a balance of Rs.5951 crore.
- DRIs - During the year, the Bank financed 0.26 lakh persons under
DRI Scheme, with total assistance of Rs.36 crore. DRI outstanding at
the end of year was 0.57 lakh accounts, with balance of Rs.67 crore.
- SHGs - 26000 SHGs have been formed during the year. Credit linked
32000 SHGs, with credit of Rs.648 crore. The outstanding SHG balance at
the end of the year stood at 82000 accounts, with balance of Rs.1331
crore.
Engaging Anchor NGOs for promoting Women SHGs (WSHGs) in Backward
Districts
The Bank has the lead bank responsibility in Chitradurga district in
Karnataka, Waynad and Palakkad districts in Kerala, which are
classified as backward districts. As per the guidelines of the
Ministry of Finance, Govt. of India, the Bank has signed MoU with
Shree Kshetra Dharmasthala Rural Development Programme (SKDRDP) in
Chitradurga district, Waynad Social Service Society Manantwadi in
Waynad District, People Service Society and Hope Foundation in Palakkad
district in Kerala for implementation of the Scheme. The Bank has also
signed MoU with Mahalir Association for Literacy Awareness and Rights
(MALAR) in Kanyakumari district of Tamil Nadu for implementation, since
the Bank has major presence in the district.
SKDRDP has formed about 8018 WSHGs in Chitradurga district and credit
linked 6071 WSHGs till 31.03.2013. 615 SHGs formed and opened SB
accounts in Waynad district and in Palakkad (Kerala), 210 WSHGs are
formed.
AADHAAR Enrolments
Pilot Project for Aadhaar enrollments is undertaken in 8 States,
covering 1.95 lakh residents. The Bank has already entered into
agreement with UIDAI by signing Aadhaar User Authentication (AUA)
Agreement and with NPCI for Aadhaar Enabled Payment System (AEPS) &
Aadhaar Payment Bridge System (APBS). The Bank is on-board with NPCI &
UIDAI. The Bank is also participating in pilot project for direct
credit of LPG subsidy.
Implementation of DBT Scheme
The Bank has already campaigned for ''One Family One Account'' in 43
identified Districts and opened over 2.71 lakh new accounts. The Bank
has ensured that CBS can capture Aadhaar numbers and provided adequate
number of access points i.e., branch, ATM, cash dispenser, BCA, etc. to
enable the beneficiaries to withdraw the money as per their ease and
convenience.
Bank as a Whole As on 31.03.2013
No. of Districts 43
No. of Branches participating 483
No. of Villages allocated 864
No. of Wards allocated 596
No. of New accounts opened 271396
No. of A/cs seeded with AADHAAR 362610
No. of new ATMs installed 109
Total No. of ATMs in 43 Districts 483
As on 31.03.2013, 1649 transactions were carried out under DBT,
amounting to Rs.38.54 lakh.
Lead Bank Scheme
Canara Bank has lead bank responsibilities in 26 Districts in the
country, viz., eight in Karnataka, seven in Tamil Nadu, five in Kerala,
five in Uttar Pradesh and one in Bihar. The Bank works as the Convenor
of the State Level Bankers'' Committee (SLBC) in the State of Kerala.
Entrepreneurship Development among Women
Centre for Entrepreneurship Development for Women (CEDW) at Head
Office, Bangalore and Centres at 34 Circle Offices are working towards
economic empowerment of women. These Centres conducted several training
programmes during the year, including general Entrepreneurship
Development Programmes (EDP), Entrepreneurship Awareness programmes,
Seminars, Career Guidance programmes, Skills and provided marketing
support to women entrepreneurs by organizing Canutsav/ Canbazar. CEDW
Centres have also assisted in formation of SHGs and credit linkages. A
Rural Self Employment Training Institute has been set up at Harohalli
to provide EDP skill trainings to women in various vocations and enable
them to take up self employment ventures. The Institute has so far
trained 16486 women in EDP skill since inception. As against RBI''s
requirement of 5% of Net Credit to women beneficiaries, the Bank has
achieved 14% as at March 2013. Over 17.76 lakh women assisted to the
tune Rs.31340 crore. In order to encourage entrepreneurship and reward
successful women entrepreneurs, the Bank launched an Annual Award
Scheme for successful women entrepreneurs financed by the Bank with 3
cash awards of Rs.25000, Rs.50000 and Rs.100000. To give focused
attention to the needs of women clientele, the Bank is dedicating 10
all women employee branches. As a CSR initiative, the Bank would also
take up a project for construction of toilets in 130 girl schools, 5
each in all its 26 lead districts with a financial outlay of Rs.1
crore.
CORPORATE SOCIAL RESPONSIBILITY
Setting Examples in CSR Activities
Following the century old tradition and founding principles, the Bank
is engaged in varied Corporate Social Responsibility (CSR) activities.
CSR initiatives of the Bank are multifarious, covering activities like
training unemployed rural youth, providing primary health care,
drinking water, community development, empowerment of women and other
initiatives.
Rural Development
The Bank, through its Canara Bank Centenary Rural Development Trust
(CBCRDT), has established 31 exclusive training institutes, including
24 Rural Self Employment Training Institutes, 3 Artisan Training
Institutes and 4 Institutes of Information Technology to promote
entrepreneurship development among rural youth and encourage them
taking up self-employment activities. During 2012-13, these training
institutes trained 26075 candidates, taking the tally to 1.76 lakh
unemployed youth since inception, with an impressive settlement rate of
73%.
The Bank has co-sponsored 27 Rural Development and Self Employment
Training Institutes (RUDSETIs) across 17 States, engaged in training
ofrural youth for taking up self-employment programmes. During 2012-13,
these institutes trained 34779 candidates. These RUDSETIs have, so far,
trained over 3.21 lakh unemployed youth, with a settlement rate of 73%.
The Bank has co-sponsored Andhra Pradesh Bankers Institute of Rural and
Entrepreneurship Development with Government of Andhra Pradesh at
Hyderabad and co-sponsored Deshpande Memorial Trust, a rural
self-employment training institute with Government of Karnataka at
Haliyal, a backward region of North Canara District. The Bank has
supported the setting up of Entrepreneurship Development Institute at
Jammu and Kashmir, Karnataka Farmers Resource Centre at Bagalkot and
sponsored Dr Ambedkar Self Employment Training Institute, Puduppur,
Tamil Nadu.
During the year, the Bank set up its first Rural Self Employment
Training Institute in Punjab at Tapa Mandi, Barnala District. The
Institute was inaugurated by Shri Pawan Kumar Bansal, Hon''ble Union
Minister for Railways on 16.12.2012.
Cumulatively, the Bank has sponsored/ co-sponsored/ supported 61
training institutes which have trained more than 5 lakh unemployed
youth so far, with a settlement rate of 73%.
The Bank has a noble scheme of Rural Clinic Services at remote
villages, lacking basic medical facilities. The Bank has so far
assisted over 565 doctors to run 39 such clinics across the country.
The Bank has donated a hi-tech, custom built, solar powered ''Retail
Mobile Marketing Van'' to assist women entrepreneurs, SHGs and artisans
to market their products.
During the year, the Bank''s Social Action Cell organized blood donation
camps, health camps and assisted people affected by natural calamities
and challenged section of the society. It has also encouraged students
by conducting various programmes and activities.
Visits by Parliamentary Committees
During 2012-13, Parliamentary Committee on Welfare of SC/ST, Standing
Committee on Labour, Standing Committee on Social Justice and
Empowerment and Standing committee on Commerce visited the Bank.
ORGANISATION AND SUPPORT SERVICES
Branch Network Expanding Pan India Presence
Continuing its branch expansion drive, the Bank added 128 domestic
branches during the year. As at March 2013, the Bank had 3728 branches,
including 5 overseas branches.
Composition of Branch Network
No. of Branches
Category 31.03.2012 31.03.2013
Metropolitan 777 811
Urban 792 795
Semi-urban 1019 1055
Rural 1007 1062
Overseas 5 5
Total Branches 3600 3728
The Bank has 161 specialized branches, catering to the specific
clientele segment.
Categories of Specialized Branches 31.03.2013
1. SMEs 72
2. Overseas 16
3. Agri-Finance 10
4. Micro Finance 19
5. Savings 6
6. NRIs 6
7. Asset Recovery Management 8
8. Prime Corporate 10
9. Industrial Finance 4
10. Stock Exchange 2
11. Capital Market 3
12. Mahila Banking 2
13. Housing Finance 1
14. Branch for Physically Challenged 1
15. Specialized Govt Business Branch 1
TOTAL 161
InfoTech Progress
The Bank took several initiatives on the InfoTech front during the
year. The Bank now offers several technology banking services, such as,
Internet Banking, Mobile Banking, Funds Transfer through NEFT and RTGS,
SMS Alerts, IVRS based enquiry across all its branches. The Bank also
offers online trading facility to its clients through its own
subsidiary M/s Canara Bank Securities Ltd.
As at March 2013, the Bank had 3526 ATMs spread across 1296 centres.
During the year, the Bank added 668 ATMs. E-lounges with hi-tech
banking facilities like ATM, Cash/ Cheque Acceptor, Passbook printing
kiosk, internet banking, online trading and telebanking have been set
up in Bangalore and Delhi and more such lounges are planned during
2013-14. Under mobile banking, the Bank enabled interbank mobile
payment service (IMPS) using IFSC code and account number for transfer
of funds without mentioning MMID, M-commerce (mobile top up) and
merchant payments (mobile top up) through IMPS on IVRS.
The Bank has made a few value additions under internet banking that
include 24X7 fund transfer facility through IMPS, Electronic Payment
Interface for Aggregators Times Money, Techpro, Atoms and CC Avenue for
providing wide range of utility bill payments facility, ''Demat View''
enabled to view the details of holdings, option to subscribe for
account statements at customized intervals and standing instructions
facility for loan accounts.
SMS/ E-mail alerts have been enabled on rate of interest changes,
inoperative CASA accounts, deposits due date reminder, reminder alerts
on the issuance of cheque books, alerts on loan installment and arrears
for customers. Internet based online loan applications and status
tracking system was developed and released for 15 loan products
including consumer loans, education loans, kisan credit card, farm
machinery loan, diary loan, corporate loans, etc.
Canara Public Grievances Redressal System has been developed in-house
and enabled for general public for registering grievances online.
Several Government business modules were implemented including core
accounting solution (Govt. E-payment gateway) for disbursement of
funds through digitally signed payment authorizations, software module
for E-payment of Prime Minister''s National Relief Fund, release of
National Pension System online software, E-scroll functionality
implementation in Central Pension Processing Centre for claiming
reimbursement of pension payments.
The notable development during 2012-13 was the completion of Automated
Data Flow (ADF) process, ensuring accurate and timely data flow to the
Reserve Bank of India without manual intervention. Enterprise- wide
Data Warehouse (EDW) project has already been initiated for setting up
an effective EDW architecture, with Business Intelligence/ Business
Analytics modules for management decision support and business
expansion.
Manpower Profile
As at March 2013, the Bank had 42693 employees on its rolls.
March 2012 March 2013
Total No. of Employees 42272 42693
Officers 17419 17835
Clerks 15802 16095
Sub-Staff* 9051 8763
* includes part-time employees (PTEs)
The Bank''s staff comprised 41.8% Officers, 37.7% Clerks and 20.5%
Sub-Staff. Women employees comprising 10849, constituted 25.4% of the
Bank''s total staff. The Bank recruited 1003 women employees and
promoted 131 women employees under various cadres during the year.
During the year, the Bank recruited 3374 persons in various cadres, out
of which 511 belonged to Scheduled Castes (SCs) and 205 to Scheduled
Tribes (STs) categories. The total number of ex-servicemen staff as at
the end of March 2013 stood at 2427. Out of which, 285 were recruited
in various cadres during the year. There were 941 Physically Challenged
Employees on the rolls of the Bank.
Reservation Policy in respect of SCs and STs
As at March 2013, the number of Scheduled Castes and Scheduled Tribes
together constituted 25.92% of total staff strength of the Bank. The
composition of SC/ST employees in the Bank as at March 2013 was as
under:
Scheduled Scheduled
Cadre Castes Tribes
Officers 3150 1200
Clerks 2875 957
Sub-staff PTEs 2499 384
Total 8524 2541
The Bank has been strictly adhering to the Reservation Policy in
respect of Scheduled Castes and Scheduled Tribes as per the Govt. of
India guidelines.
(a) Reservation Policy is implemented through mechanism of Post Based
Rosters. In terms of the directives of the Ministry of Finance,
Government of India, the Bank has since switched over to Post Based
Rosters for all cadres.
(b) The Bank has been extending Reservation/ Relaxations/Concessions in
Direct Recruitment as well as in promotions to candidates belonging to
Scheduled Castes and Scheduled Tribes as per the Govt. guidelines.
(c) Pre-recruitment and Pre-promotion training is given to candidates
belonging to Scheduled Castes and Scheduled Tribes. In the
Advertisement inviting for the application from the eligible candidates
for recruitment to Clerical and Officer cadres, a specific reference is
made with regard to imparting of pre- recruitment training to
candidates belonging to SC / ST / PWD / Minority Communities /
Ex-Servicemen. Such of those candidates who opt for pre-recruitment
training will be given training to prepare themselves for written test
as well as interview. The duration of the training is 6 days.
Study materials, note book, stationeries are provided free of cost to
all the participants. Wherever possible, respective State Governments
are also providing the Lodging Facilities in Government / backward
class hostels.
(d) The Bank has setup SC/ST Cell at the Head Office and also at Circle
Offices to ensure maintenance of Rosters and implementation of other
aspects of Reservation Policy.
(e) Chief Liaison Officer has been nominated at Head Office and Liaison
Officers have been nominated at Circle Offices for ensuring
implementation of Reservation Policy.
Further, representations received from Scheduled Caste / Scheduled
Tribe employees, either directly or through the SC/ST Associations, are
being looked into by the Liaison Officer/Chief Liaison Officer.
Wherever required, necessary enquiries are conducted and appropriate
action is taken. A separate register is maintained for recording
various representations received from Scheduled Caste/Scheduled Tribe
employees and the action taken is also recorded in the register.
In addition to the above, the representatives of majority Scheduled
Caste/ Scheduled Tribe Employees'' Association are invited for Quarterly
Meeting with the Chief Executive of the Bank to discuss on the
implementation of guidelines on reservation policy. Quarterly Meetings
are also held at Circle Offices, where Rosters are maintained and
grievances, if any, are redressed by the Liaison Officer.
(f) The Board of Directors of the Bank also review the progress made in
the implementation of Reservation Policy on half yearly and yearly
basis.
Human Resource Development (HRD) Activities
The HR policies of the Bank have been revisited to suit the changing
banking scenario. HR interventions like SPANDAN for bringing
attitudinal change among front line staff and Executive grooming
through reputed institutes and other significant HR tools like Quality
Circles, Study Circles, Staff Meetings and Brain Storming Sessions have
been implemented for effective team building and fostering collective
excellence.
The Bank has an exhaustive training process covering 4 genres of
activities, viz., Internal Training, External
Training, In company Training and Foreign Training. The Bank has Staff
Training College at Bangalore and 13 Regional Staff Training Colleges.
Various corporate communications are brought out to boost the morale of
the employees and educate them in various facets of banking.
The Bank trained 31100 employees during the year, covering a wide range
of functional areas including Credit Orientation, Marketing for Counter
Staff and Induction Programme for Clerks, Officers, Rural Officers and
Technical Field Officers. Out of the trained staff, 6452 personnel
belonged to the Scheduled Caste category, 1829 belonged to the
Scheduled Tribe category and 7528 were women employees. The Bank
designed and implemented 2 new training programmes, viz., Jagaran and
Basic Credit Appraisal and Monitoring.
''Jagaran'' was a soft skills training programme conceived to de-stress
employees through the institutes of repute at external venues on
residential basis. During the year, 7584 Officers and Clerks were
trained under this programme.
The Bank has envisioned a novel programme, viz., Talent Bank to provide
opportunities for generalist officers to assume the role of specialists
in 10 identified streams. Establishing a proper Talent Management and
Reward System will be the Bank''s focus in the coming years. There will
be concerted efforts to identify potential leaders and groom them to
take up higher responsibilities.
Further, the Bank''s quest to enhance the competencies of the workforce
continued through focused and need based trainings at various
institutes of repute like IIMs, JNIBF, ISB, XLRI and NIBM. Customized
programmes are also organized to develop expertise in certain niche
areas like Risk Management, Treasury Operations and IT.
Specialized trainings to the Senior Management Level/ Top Management
Level Executives are conducted based on the requirement. The Bank has
been able to add substantially to the skill level of its officials
through this training intervention and motivating them to perform with
renewed vigor and enthusiasm.
The Bank has formed a Sub-Committee of the Board of Directors on HR to
review and improvise the existing HR policies and make suggestions to
accelerate the employee engagement initiatives.
Changes in the Organizational Setup
The organizational design and structure are continuously revisited and
studied for functional excellence.
Keeping in view the increased business complexities, the need for more
focus on certain key functional areas, the re-organization/re-aligning
functions of Wings at Head Office was undertaken. A new Wing, namely,
Marketing and Business Process Reengineering Wing was formed during the
year.
Customer Orientation
The Bank has taken several initiatives to remain customer focused
through providing fast service, bringing in diversified
products/services, responding to customer''s queries and redressal of
customer complaints. The ''Code of Commitment to Customers'' issued by
BCSBI is made available in the Bank''s website. To assess the quality of
customer service rendered by the branches and to get feedback,
"Customer Satisfaction Survey Form" is made available in the Bank''s
website. Customer''s Fortnight was conducted from 15.11.2012 to
30.11.2012 inviting suggestions from customers.
Toll free contact at Customer Service Section, Head Office, is provided
to facilitate the customers to represent their grievances. Toll free
contact facility at ATM switch room and Card Division are provided to
the users to represent the matters pertaining to ATM operations and
Card business.
Call Centre is functioning to cater to customers in 6 regional
languages for redressal of grievances. The number of calls received by
the Call Centre during the year is more than 10.28 lakh and percentage
of complaint redressal is 98%. During the year, 5075 complaints were
received and 4968 complaints have been redressed. 1300 Banking
Ombudsman cases were received during the year and resolved.
Centralised Pension Processing Cell has been established exclusively
for handling Central Government pensions and resolving pension related
grievances. Central Processing Centres are established at selected
places for account opening purposes. The Bank has implemented online
grievance redressal facility for customers in the Website, to lodge
their grievances online under the portal Canara Public Grievance
Redressal System (CPGRS).
"Town Hall Customers Meets" were held at different Centres including
Mumbai, Delhi, Trivandrum, Mysore, Madurai and Vishakapatnam in
association with the Banking Ombudsman, RBI and BCSBI.
Systems and Procedures
Risk Based Internal Audit (RBIA) was conducted in 2327 branches / units
programmed for on-site RBIA during the year. Information Security Audit
was conducted along with RBIA. Concurrent / Continuous Audit is
conducted in 730 identified branches / units (covering 70.2% of
deposits and 80.5% of advances) as on 31.03.2012 as per RBI guidelines.
Income / revenue audit was conducted on quarterly basis in 543
identified branches as per Jilani Committee Recommendations. RBIA was
also conducted in 26 Circle Offices and 15 Wings of Head Office during
the year.
Besides having an Offsite Transaction Monitoring Cell (OTM Cell), the
Bank opened Offsite Monitoring Cells at all Circle Offices during the
year to strengthen the offsite surveillance and to track exceptional
transactions. Mid- term Offsite risk assessment of branches/offices was
carried out as per guidelines, to monitor movement of risk at branches.
Sampling Technique was introduced in select areas to know the extent of
deviation, if any, in order to take corrective action immediately.
Sustenance Audit was introduced to review the progress made in respect
of RBIA, LFAR and AFI observations. 100% verification of EMT properties
/ documents during RBIA of branches was introduced to ensure safety of
assets.
Know Your Customers (KYC)
The Bank took several measures for the effective implementation of Know
Your Customer (KYC) and Anti Money Laundering (AML) guidelines and for
ensuring KYC compliance by all branches.
To ensure better compliance of guidelines on KYC / AML, following steps
have been initiated.
- The Bank has ensured 100% submission of Cash Transaction Reports
(CTRs) and Non-profit Organizations Transactions Reports (NTRs) to
Financial Intelligence Unit (FIU).
- Suspicious Transaction Reports (STRs) and Counterfeit Currency
Reports (CCRs) are submitted to FIU promptly.
- Snap Audits conducted every month at 80 randomly selected branches,
covering all Circles to verify adherence to KYC/AML norms.
- A onetime Special KYC audit was conducted at 343 randomly selected
branches covering entire geographic area during July 2012 to verify
updation of KYC data (document details) in the system.
- Risk Categorization of customers has been done centrally as per
Hybrid Model recommended by the IBA Working Group.
- The Bank has a web based AML package to monitor transactions from
the anti-money laundering angle. The AML package is generating alerts
based on alert scenarios recommended by the IBA Working Group.
Vigilance Setup
The Vigilance Wing of the Bank is headed by the Chief Vigilance Officer
(CVO) in the rank of General Manager. The CVO is assisted by Vigilance
Officers stationed at all Circles, Head Office, RRBs and the Bank''s
Subsidiaries. The objectives of the Vigilance Wing are to ensure that
discipline and development, go hand in hand and help the Bank to reach
greater heights.
As a part of the Vigilance Awareness campaign, as per the directives of
the Central Vigilance Commission, the Bank observed Vigilance Awareness
Week from 29th October to 3rd November 2012, with more focus on the
theme "Transparency in Public Procurement". On this occasion, a two
days programme on ''Preventive Vigilance in Public Procurement'' by
Shri R Radhakrishnan, Retired General Manager of RBI and ex-Chief
Vigilance Officer of State Bank of India/Bank of India, was conducted
at the Bank''s Staff Training Colleges, Bangalore, Gurgaon and Delhi.
The Programme was extremely beneficial to the Bank''s officials to take
precautionary measures in the procurement process as also to bring
general awareness amongst the Bank officials about Public Procurement.
Continuing the vigilance awareness campaign, a speech by Shri Srinivas
Galgali, ITS Chief Vigilance Officer, Kudremukh Iron Ore Company Ltd,
Bangalore on ''Transparency in Public Procurement'' was arranged on
03.11.2012 for the Executives of Head Office.
GM & CVO conducted "Seminars on prevention of frauds and Vigilance"
at the Circles visited during the year, wherein, apart from reviewing
the pending disciplinary matters pertaining to the Circle, the CVO also
dwelt upon various aspects related to Preventive Vigilance Mechanism in
the Bank, fraud prone areas with special emphasis on CBS environment,
handling of disciplinary matters and need for timely disposal,
maintaining secrecy of passwords in computerized environment and
effective role of Preventive Vigilance Committee at branches.
Under the auspices of the Vigilance Study Circle Bangalore, the Bank
hosted series of programmes, such as, a lecture session by Prof. M V
Rajeev Gowda, from Indian Institute of Management, Bangalore (IIMB) on
"Electoral Reforms" on 22.06.2012; a speech on "Ethics & Values" by
Prof. (Dr) R Venkata Rao, Vice Chancellor of National Law School of
India University, Bangalore on 26.12.2012 and Quiz competition for
students of various Schools in Bangalore on 08.01.2013.
Special emphasis was laid on popularizing the project ''VIGEYE'' and also
the formation and activation of Preventive Vigilance Committees at all
branches of the Bank.
Security Arrangements
During the year, security measures have been strengthened. To improve
the security at branches, CCTV systems are installed in 1554 branches.
In addition to the above, 1021 ATMs are also provided with CCTV system
to monitor the security. 85 Currency Chests are provided with Biometric
Access Control System as per RBI guidelines.
Ambience Improvement
During the year, ambience improvement work was carried out in more than
200 branches of the Bank. The Bank has initiated steps for ambience
improvement including air conditioning in 1000 more branches during the
current financial year.
Right to Information
Under the Right to Information Act, 2005, an exclusive Right to
Information Act outfit is functioning to provide information and bring
transparency. As per the requirement of the RTI Act, the Bank has
nominated Public Information Officers and Appellate Authorities at Head
Office and in all its 34 Circle Offices to provide information to the
applicants. During the year, the Bank received 3352 RTI applications,
520 First Appeals and 65 Second Appeals as per the provisions of RTI
Act, 2005.
Implementation of Official Language
The Bank made noteworthy progress under the implementation of official
language and won many prizes at various levels during the year under
review. The Bank was awarded first prize by Town Official Language
Implementation Committees at Bangalore (Head Office), Karnal and
Madurai Circles. Apart from this, many Circles and branches have
received awards from respective Town Official Language Committees.
As at March 2013, around 98% ofemployees have obtained working
knowledge in Hindi and the Bank has notified 2379 branches under Rule
10(4) of OL Rules 1976. All the employees of the Bank possessing
working knowledge of Hindi have been trained in Hindi workshops. During
the year under review, the Bank has conducted more than 238 refresher
training programmes for such employees.
In the sphere of using Information Technology in the Official Language,
the Bank increased the use of Unicode package for word processing and
also made provision in ATM screens of the Bank for carrying transaction
in 10 Indian languages. Telebanking facility has also been provided in
Hindi and English and other 6 major regional languages. The Bank''s
corporate website is fully in bilingual. The Bank is also giving SMSs
in Hindi to all its customers on special occasions. With effect from
1st July, 2011, the Bank has provided Hindi option in Core Banking
System. The Bank''s bilingual address booklet ''CANPATHA'' is made
available to all our branches and offices in electronic form.
To encourage effective implementation of Official Language in the Bank,
164 prizes were given to Circles, Branches, RSTCs and Sections of
offices under the Award Scheme formulated by the Bank viz., Canara Bank
Rajbhasha Akshay Yojana and 107 employees were awarded under Rajbhasha
Puraskar Yojana. The Bank has also started an annual "All India Hindi
Essay Competition" for its employees and handsome cash prizes were
given to prize winners.
Shri Sandip, Sr Manager, Advances Section, Circle Office, Agra has been
awarded with Encouragement Prize under All India Hindi Essay writing
Competition organised by RBI-College of Agricultural Banking (CAB),
Pune.
The 30th All India OL Conference of OL Officers of the Bank was held at
RSTC, Gurgaon on 4th and 5th March 2013. The Bank''s annual Hindi
journal "Canarajyoti" - 10th issue- was released on the occasion by
the Executive Director Shri. Ashok Kumar Gupta. Canarajyoti is brought
out to encourage original writing in Hindi. This publication contains
articles written by employees on banking related subjects in Hindi. On
06.03.2013, a Programme called "Rajbhasha Prabodhan Karyakram" was
also conducted for the OL Officers at RSTC, Gurgaon.
The 3rd Sub Committee of Parliamentary Committee on Official Languages
had inspected our new Tihri and Rishikesh Branches and Head Office was
inspected by Drafting & Evidence Committee and lauded the efforts put
by the Bank in the field of Official Language implementation. The Bank
is convening the Town Official Language Implementation Committees of
Bangalore, Coimbatore and Thiruvananthapuram. Official Language
Implementation Committees are constituted in all the branches of the
Bank to motivate and guide the employees towards effective
implementation of Official Language Policy of the Govt. of India.
Promotion of Sports
Canara Bank has always been encouraging and supporting sports. A Sports
Council at Head Office was set up in the year 1982 to monitor and
encourage sports in the Bank.
The Bank has on its rolls 40 sports persons in six disciplines, viz.,
Cricket, Hockey, Women''s Athletics, Shuttle Badminton, Ball Badminton
and Table Tennis.
International Cricketers Shri B K Venkatesh Prasad, Shri Sunil Joshi,
Ms Shantha Rangaswamy are presently in the Bank''s fold.
Besides the Cricketers, Shri U Vimal Kumar, (Shuttle Badminton), Smt M
K Asha, Smt Suma Gopalakrishna and Smt H M Jyothi (Athletics) and Shri
Bharat Chhetri, Shri P Shanmugam, Shri K M Somanna, Shri K P Dinesh, Jr
International, (Hockey) are also on the Bank''s rolls.
Over the years, Canara Bank has secured several distinctions in the
sporting arena and the Bank''s Cricket, Ball Badminton, Shuttle
Badminton and Table Tennis Teams rank numero uno in the State of
Karnataka.
Notably during 2012-13, Shri Bharat Chhetri was nominated as the
Captain of the Indian Hockey Team for the Summer Olympic Games, London,
2012.
The Bank''s Cricket Team won the 1st Bihar T-20 Gold Cup held at Patna.
Shri C Raghu of the Bank''s Cricket Team won the Man of the Series
Award. Shuttlers Shri D Gururprasad and Shri Vineeth Manuel (doubles
pairing) were ranked 1st in Karnataka and 2nd in India. Cricketers
Shri N C Aiyappa, Shri K B Pawan, Shri Rajoo Bhatkal and Shri Deepak
Chougule are part of the Ranji Trophy squad.
Apart from the Teams at Head Office, the Bank is also sponsoring Teams
at Circle Office level for the local/ regional Inter Bank Tournaments.
More than 50% of the Bank''s sports personalities are representing the
State of Karnataka in their respective sporting discipline.
FINANCIAL SUPERMARKET
Subsidiaries, Sponsored Entities and Joint Ventures Canara Bank, with
an objective of offering ''One Stop Banking'' for the customers, forayed
into diversified business activities by opening subsidiaries during
late 1980s. Today, the Bank functions as a ''Financial Supermarket'' with
as many as nine subsidiaries / sponsored entities / joint ventures in
diversified areas. The Bank has taken significant steps towards
strengthening fundamentals of these entities so as to emerge as a
strong ''Financial Supermarket'' in India. All the subsidiaries /
sponsored entities / joint ventures of the Bank recorded satisfactory
performance during the reporting year.
Commercial Bank of India LLC (CBIL)
CBIL, a joint venture of Canara Bank and State Bank of India, has been
operational since April 2004 in Moscow, Russia. The Company earned a
profit after tax of US$4.11 million as on 31st March, 2013.
Canbank Venture Capital Fund Limited (CVCFL)
CVCFL, the Trustee and Manager of Canbank Venture Capital Fund (CVCF),
is a wholly owned subsidiary of the Bank and is providing Venture
Capital assistance. The Company recorded a profit after tax of Rs.7.19
crore for the year 2012-13 as against Rs.7.06 crore for 2011-12. The
Company has proposed a dividend of 400% for the year 2012-13.
Can Fin Homes Limited (CFHL)
Canfin Homes Limited, a sponsored entity of Canara Bank, is one of the
premier housing finance entities in the country. As on 31.03.2013, the
Bank''s stake in CFHL is 42.35%. The Company sanctioned loans amounting
to Rs.2092.65 crore and disbursed loans amounting to Rs.1813.77 crore
during the year. The Company earned a profit after tax of Rs.54.12
crore for the year ended March 2013. The Company has proposed a 40%
dividend for the year 2012-13.
Canbank Factors Limited (CFL)
Canbank Factors Limited is a factoring subsidiary of the Bank. During
2012-13, the Company achieved a total business turnover of Rs.3123
crore. The Company has earned Profit after Tax of Rs.15.98 crore for
the year ended March 2013. The Company has proposed 20% dividend for
2012-13. The Company enjoys the highest rating of "P1 " by CRISIL for
its short term debt programme.
Canbank Computer Services Limited (CCSL)
Canbank Computer Services Limited is the only Software Company promoted
by a public sector bank in the country. CCSL is primarily engaged in IT
and Software development services, training/consultancy and registrar
and share transfer agency. The Company is a member of the NASSCOM and
Registered as a software solution provider for World Bank projects. The
Company has achieved the Profit after Tax of Rs.4.25 crore for the year
against Rs.3.10 crore in the previous year. The Company has been
successfully managing the Call Centre activity and ATM outsource
services for 1200 plus ATMs of the Parent Bank.
Canara Bank Securities Limited (CBSL)
Canara Bank Securities Limited, (formerly Gilt Securities Trading
Corporation Limited) has diversified into capital market related
activities, mainly stock broking since 2007.
The Company offers stock broking services to both institutional and
retail clients. Online Trading Counter for retail customers is its
flagship product under portal ''Canmoney.in''. The Company has
diversified into Currency Derivatives. The Company has posted a Profit
after Tax of Rs.8.08 crore and paid 15% dividend of Rs.6.00 crore for
2012-13.
Canbank Financial Services Limited (Canfina)
Canbank Financial Services Ltd has confined its activities to legal
matters arising out of past transactions in securities, besides
concentrating on collection of lease rentals and recovery of dues under
decreed accounts. During 2012-13, Canfina recorded a profit after tax
of Rs.1.49 crore. It has repaid Rs.351.45 crore out of the hand holding
support of Rs.376.45 crore given by the Bank and proposes to clear the
entire liability of Rs.25 crore outstanding during the current fiscal
year.
Canara Robeco Asset Management Company Limited (CRAMC)
To manage assets of Canbank Mutual Fund, M/s Canbank Investment
Management Services Limited (CIMS) was established in 1993. In the year
2007, Canara Bank divested 49% stake of Asset Management Company in
favour of M/s Robeco Groep N V forming a joint venture for managing the
assets of Canbank Mutual Fund. The Company has since been renamed as
Canara Robeco Asset Management Company Limited.
The JV aims to capture a worthwhile market share of mutual fund
industry by bringing best international practices and expertise
supported by the vast network of the Bank. With a majority share of 51%
held by the Bank, the Assets under Management (AUM) of the Company
increased to Rs.8550 crore, with an investor base of Rs.5.52 lakh. The
Company is currently managing 24 Mutual Fund Schemes. The Company
posted a net profit of Rs.13.55 crore for the year 2012-13.
Canara HSBC Oriental Bank of Commerce Life Insurance Company Limited
An Insurance Joint Venture floated by the Bank in association with
internationally reputed HSBC Insurance (Asia Pacific) Holding Limited
and Oriental Bank of Commerce. The Company was incorporated during
September 2007 and commenced its business operations from 16.06.2008,
with a majority shareholding of 51% held by the Bank.
During the year, the Company reached total business premium of Rs.1894
crore. The Company recorded profit of Rs.14.80 crore. Out of the 23
private players in the insurance field in India, the Company ranked
12th position.
Regional Rural Banks (RRBs)
The Bank sponsored three Regional Rural Banks in three states viz.,
Pragathi Gramin Bank (Karnataka), South Malabar Gramin Bank (Kerala)
and Shreyas Gramin Bank (Uttar Pradesh), with a total network of 963
branches. As at March 2013, all the RRBs were profit making and the
capital adequacy ratio is above the mandatory norm of 9%. The aggregate
business of the RRBs crossed the mile stone mark of Rs.25000 crore and
stood at Rs.25106 crore, comprising Rs.13488 crore under deposits and
Rs.11618 crore under advances as at 31.03.2013. Pragathi Gramin Bank
ranks 2nd position amongst RRBs of Karnataka and South Malabar Gramin
Bank ranks 1st position amongst RRBs of Kerala. 3 RRBs opened 77 new
branches and 926 ultra small branches during the year.
All the RRBs ensured 100% coverage of all FI villages (population of
more than 2000) with Business Correspondents. The priority sector
advances were at 85% as against the norm of 60% set by the Ministry
Agriculture Credit outstanding stood at Rs.7630 crore as at March 2013.
Under technology advancements, all the RRBs have migrated to CBS
platform, implemented IT products like NEFT, RTGS, ATM, SMS alerts, KCC
RuPay cards, etc. Further, system based recognition of non-performing
assets for all the accounts has been implemented.
Shreyas Gramin Bank and Aryavart Kshetriya Gramin Bank were amalgamated
into a single Regional Rural Bank vide Ministry of Finance notification
F No.7/9/2011- RRB (UP-1) dated 01.04.2013 under the sponsorship of
Bank of India and has been renamed as Gramin Bank of Aryavart with its
Head Office situated at Lucknow.
AWARDS/ACCOLADES Awards and Accolades
In recognition of the varied initiatives, the Bank was conferred with
the following awards -
- Best Bank Award among large banks by IDRBT for "Use of Technology
for Financial Inclusion" handed over by RBI Governor Dr. D Subbarao.
- Skoch Award for Financial Inclusion, handed over by Dr. C
Rangarajan, Chairman, PMEAC.
- 1st Rank for Self Help Groups Linkage for the year 2011-12 in the
State of Bihar.
- Award for ''Best Online Bank'' among Public Sector Banks- IBA
Banking Technology Awards 2011.
- Award for ''Best Customer Relationship Initiative'' among Public
Sector Banks - IBA Banking Technology Awards 2011.
- The Greatest Corporate Leaders of India - Leadership in Banking
Award, instituted by World HRD Congress, 2013.
- Prestigious Platinum Greentech HR Award 2013 under HR Oriented CEO
by M/s Greentech Foundation, New Delhi.
- Platinum Award, for Best HR Strategy and Training Excellence by M/s
Greentech Foundation, New Delhi.
- National Vigilance Excellence Award - 2012 for the second
consecutive year from Vigilance Study Circle, Hyderabad under the
auspices of the Central Vigilance Commission.
VARIOUS POLICIES OF THE BANK
There is a system of well-defined policies and procedures of the Bank.
During the year, concerted efforts were made to streamline the policies
and procedures of the Bank in the light of regulatory requirements of
the RBI, the directions of the Government of India and the emergent
requirements of the Bank in the present day context. Accordingly,
there has been a sharper focus on policies relating to, among others,
Credit Risk Management, Market Risk Management, Operational Risk
Management, Asset Liability Management, Liquidity Risk Management,
Country Risk, Counterparty Bank Risk, Corporate Governance,
Disclosures, Collateral Management, Stress Testing, Compliance
Functions, Disaster Recovery and Business Continuity Planning, Business
Lines, Outsourcing and Internal Capital Adequacy Assessment Process
(ICAAP), Know Your Customers (KYC), Anti-Money Laundering (AML),
Recovery and Investments.
CHANGES IN THE BOARD OF DIRECTORS
Year 2012-13 saw the following changes in the composition of the Board
of Directors of the Bank.
- The tenure of Shri S Raman as Chairman & Managing Director ended on
superannuation on 30.09.2012.
- Smt Sudha Krishnan was nominated as Government of India Nominee
Director w.e.f. 16.11.2012 in place of Dr Thomas Mathew, whose term as
Government of India Nominee Director consequently ended on 15.11.2012.
- Shri R K Dubey was appointed as Chairman & Managing Director of the
Bank w.e.f 11.01.2013.
Brief Profile of the newly appointed Directors of the Board of the Bank
during 2012-13
Smt Sudha Krishnan
At present, Smt Sudha Krishnan is the Joint Secretary (Personnel),
Department of Expenditure, Ministry of Finance, Government of India.
Shri R K Dubey
Shri R K Dubey joined Punjab National Bank in the year 1977 as a
Management Trainee and moved up to the ranks of a General Manager in
2008. He was appointed as Executive Director of Central Bank of India
in 2010.
A techno-savvy banker with extensive multi-dimensional banking
operational experience, Shri Dubey possesses enormous inter-personal,
communication and leadership skills with proven abilities in team
management and customer relationship management. He takes challenges
and believes in setting own goals.
DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors, in preparation of the annual accounts for the year ended
March 31, 2013, confirm the following:
- That in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures.
- That they had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Bank at the end of the financial year and of the profit or loss of
the Bank for the period.
- That they had taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of
applicable laws governing banks in India for safeguarding the assets of
the Bank and for preventing and detecting fraud and other
irregularities.
- That they had prepared the annual accounts on a going concern
basis.
ACKNOWLEDGEMENT
The Bank made several initiatives to maximize rewards for all its
stakeholders, viz., shareholders, customers, investors, Government,
RBI, employees and the public at large.
The Board wishes to place on record its sincere appreciation to the
customers for their patronage, to the shareholders for their support,
to the Government authorities and the Reserve Bank of India for their
valuable guidance and support, to the Directors who completed their
tenure during the financial year under review, to the Bank''s
Correspondents in India and abroad for their co-operation and goodwill
and to all the Staff Members for their full support in the journey
towards growth and excellence.
R K DUBEY
CHAIRMAN AND MANAGING DIRECTOR
Mar 31, 2012
The Board of Directors have pleasure in presenting the 43 rd Annual
Report together with the Balance Sheet as on 31st March, 2012 and
Profit and Loss Account for the financial year ended March 31,2012.
FINANCIAL PERFORMANCE
During the year, due to slackened business growth and increase in
stressed assets at the industry level, the Bank took a conscious
decision to consolidate its business position and rebalance assets and
liabilities. The performance of the Bank on the business, profits and
profitability fronts areas under.
The Bank earned a net profit of Rs3283 crore for 2011-12 compared to
Rs4026 crore last year. Operating profit of the Bank stood at Rs5943 crore
compared to Rs6091 crore last year. Return on average assets (RoAA) for
the year stood at 0.95%. Profit per employee worked out to Rs8.21 lakh
for the year.
Dividend of 110% for 2011-12
Enhancing Shareholder Value
The Bank's Board of Directors recommended a dividend of 110% for
2011-12. While Book Value increased to Rs431.26 as at March 2012 as
compared to Rs 3 59.2 5 for the previous financial, EPS stood at Rs74.10
as at March 2012 compared to Rs97.83 a year ago. Return on Equity stood
at 18.75% for 2011-12.
March March
Key Financial Ratios (%) 2011 2012
Cost of Funds 5.37 6.72
Yield on Funds 8.13 8.95
Cost of Deposits 5.80 7.35
Yield on Advances 9.73 10.93
Yield on Investments 7.72 7.96
Spread as a % to AWF 2.76 2.23
Net Interest Margin (NIM) 3.12 2.50
Operating Expenses to AWF 1.56 0.51
Return on Avg. Assets
(RoAA) 1.42 0.95
Return on Equity 29.47 18.75
Business per Employee (Rs
in Crore) 11.96 13.74
Profit per Employee (Rs
in Lakh) 9.76 8.21
Book Value (Rs) 359.25 431.26
Earnings per Share (Rs) 97.83 74.10
AWF - Average Working Funds
Income and Expenditure Analysis
The Bank's interest income recorded a y-o-y growth of 34.5% to reach
Rs30851 crore compared to Rs22940 crore recorded during the previous
financial year. Non- interest income increased to Rs2928 crore compared
to Rs2811 crore recorded last year.
The Bank's cost of deposits increased to 7.35% due to uptrend in
interest rates during the year. The yield on advances improved to 10.93%
as at March 2012 compared to 9.73% last year. Interest spread stood at
2.23% compared to 2.76% as at March 2011.
While interest expenditure increased to Rs23161 crore with a y-o-y
increase of 52%, the Bank contained its increase in operating expenses
at 5.7% amounting to Rs4674 crore. The net interest income of the Bank
stood at Rs7689 crore and Net Interest Margin (NIM) worked out at 2.50%.
Capital and Reserves
Networth of the Bank, as at March 2012 increased to Rs19027 crore
compared to Rs15915 crore as at March 2011. While total paid-up capital
of the Bank was Rs443 crore, reserves and surplus increased to Rs22247
crore. The Government Shareholding in the Bank stood at 67.72% as at
March 2012.
(Amt. in RsCrore)
March2011 March2012
Composition of Capital Baje|| Baje||
Risk Weighted Assets 176136 210875
Tier I Capital 19139 21829
CRAR(%)(Tierl) 10.87 10.35
Tier II Capital 7956 7179
CRAR(%)(Tierll) 4.51 3.41
Total Capital 27095 29008
CRAR(%) 15.38 13.76
Capital Adequacy Ratio stood at 13.76%, with Tier I capital ratio at
10.35% as at March 2012. The Bank has adequate headroom available under
both Tier-1 and Tier- 11 options to raise capital to support business
growth momentum.
BUSINESS GROWTH
deposits
Total Deposits of the Bank registered a growth of 11.5% to reach
Rs327054 crore as at March 2012 compared to Rs293437 crore a year ago.
The Bank's CASA deposits reached Rs79611 crore as at March 2012. The
Bank's CASA deposits to domestic deposits stood at 25.16%.
Savings deposits rose by 10.5% to Rs64792 crore as at March 2012.
During FY12, the Bank launched nationwide campaign to mobilize SB
deposits in two phases. During the campaign period, the Bank has
brought in about 24 lakhs fresh SB clientele and about Rs3000 crore SB
deposits in the new accounts.
Pursuing a strategy of broad-basing deposit clientele, all the branches
together opened over 33 lakhs deposit accounts, taking the total number
of deposit accounts to 3.75 crores.
Advances (Net)
During 2011-12, the Bank's net advances witnessed a 10% growth to reach
Rs232490 crore compared to Rs211268 crore a year ago. The Bank's
diversified credit portfolio include all productive segments of the
economy like agriculture and Micro, Small and Medium Enterprises
(MSME), exposure to corporate and infrastructure segments. As at March
2012, the number of borrowal accounts stood at45 lakhs.
During 2011-12, the total business of the Bank grew by 10.9% to reach
Rs559544 crore as against Rs504705 crore during the previous financial.
The Bank's domestic business constituted about 96% of the total
business.
Productivity, as measured by business per employee, increased to Rs13.74
crore from Rs11.96 crore a year ago. During the year, the Bank's
clientele base increased to 4.20 crores.
Retail Lending Operations
Outstanding retail lending of the Bank stood at Rs24782 crore as at March
2012. The disbursals under the retail lending stood at Rs12279 crore.
The outstanding housing loan portfolio increased to Rs15808 crore,
constituting 64% of the total retail lending portfolio.
The Bank took several measures during the year to expand retail credit.
Retail Loan festival was observed during September-March 2012, wherein
rate of interest was reduced along with concession in processing
charges. To facilitate speedy disposal of proposals and credit flow, 19
Centralized Processing Units (CPU) were upgraded to Retail Asset Hubs
(RAHs). As at March 2012, the Bank had 37 RAHs and 6 CPUs at major
centres across the country, covering 1456 branches. The Bank has
implemented Online Loan Application and Tracking System.
TREASURY AND INTERNATIONAL OPERATIONS
Aggregate investments (net) of the Bank was at Rs102057 crore as at March
2012. Portfolio modified duration came down to 4.62 years as at March
2012 from 4.75 years a year ago. The modified duration of the Available
for Sale (AFS) portfolio has increased to 3.23 years as at March 2012
from 2.23yearsasat March 2011 due to redemption of short dated
securities and fresh investments made in medium and long dated
securities. The trading profit fortheyearwasRs324crore as against Rs236
crore last year. The yield on investments improved to 7.96% as compared
to 7.72% a year ago
The Bank continues to be an active player in Government securities as a
primary dealer. The total amount of underwriting commitments for the
year was Rs 52688 crore. During the year, the Bank achieved over 64%
success ratio as against mandatory 40% of its obligation as a Primary
Dealer.
Foreign Business Turnover of the Bank aggregated to Rs144624 crore,
comprising Rs54036 crore under exports, Rs41151 crore under imports and
Rs49437 crore under remittances as at March 2012. Outstanding export
credit of the Bank stood at Rs10382 crore as at March 2012.
The Bank's overseas operations covered 6 countries with one branch
each at London and Leicester (UK), Hong Kong, Shanghai (China) and
Manama (Bahrain) and a Representative Office at Sharjah (UAE). These
apart, a joint venture Bank, namely Commercial Bank of India LLC in
Moscow is also operational in association with State Bank of India.
All overseas branches recorded improved business performance during the
year. Total business of the five overseas branches aggregated to US$4.33
billion for the financial year ending March 2012.
The Bank has approval from RBI for expansion in 8 other International
Centres, namely, Qatar, Johannesburg (South Africa), Frankfurt
(Germany), New York (USA), Sao Paulo (Brazil), Dar-es-Salaam
(Tanzania), Tokyo (Japan) and Abuja (Nigeria). In this regard, the Bank
has filed application with regulators of South Africa, USA and Qatar.
The Bank's international operations are well supported by a wide
network of 373 Correspondent Banks, spread across 79 countries. Rupee
Drawing Arrangement has been made with 29 Exchange Houses and 17
Overseas Banks in the Middle East for channelizing the remittances of
Non- Resident Indians. The Bank has been managing two Exchange Houses
viz., Al Razouki International Exchange Company, Dubai and Eastern
Exchange Est., Qatar under Secondment and Management Agreement
respectively.
The Bank has implemented 'Remit Money' a Web Based Speed Remittance
product by extending to 28 Exchange Houses and to 4 branches abroad
viz. London, Leicester, Shanghai and Hong Kong. During the year
2011-12, the Bank obtained approval from RBI for remittance
arrangements with 5 more Exchange Houses in UAE.
OTHER SERVICES
During 2011-12, Merchant Banking Division handled one Rights issue of
equity amounting to Rs90.23 crore. The Division also handled Private
Placement Capital Gain Bond Issues of National Highways Authority of
India (NHAI) and Rural Electrification Corporation Ltd (REC) as
Arrangers. Amount mobilized in respect of Capital Gain Bonds Issue of
NHAI and REC during the year was Rs120.33 crore. Five assignments of
'Fair Valuation of Equity' were also handled by the Division
During the year.
The Bank acted as Collecting Bankers in 1 Rights and 3 Private
Placement Issues, involving an amount of Rs1147.16crore.The number of
issues handled under Application Supported by Blocked Amount (ASBA) by
the designated branches were 34 and the amount blocked was
Rs140.54crore.
The Bank's Syndication Group handled projects involving project cost
of Rs27221 crore during the year, with a total debt size of Rs6825 crore.
The Group has generated substantial fee based income from the
syndication operations. The funds are arranged for projects in various
segments like Steel, Power, Road, Sugar,Textiles, etc.
The Bank has tie-up arrangements in both life and non-life insurance
segments under its 'bancassurance' arm. The Bank earned a commission
income of Rs 26.24 crore from its joint venture viz.,Canara HSBCOBC Life
Insurance Company Ltd. Under the mutual fund business, the Bank earned a
commission of Rs 3.9 crore from its joint venture viz., Canara Robeco
Asset Management Company Ltd. The Bank'stie-up arrangementwith M/s
United India Insurance Company Ltd (UIICL)for non-life (general)
insurance business has resulted in a commission income of Rs 11.6 crore
during the year. The Bank has also Corporate Agency Agreement with M/s
Export Credit Guarantee Corporation of India for marketing export
Policies through its branches across India.
Corporate Cash Management Services (CCMS) network of the Bank, covering
60 Operating Centres, provides services related to local and upcountry
cheque collection facility. The Bank has planned to integrate the
collection products with core banking services covering 300 centres
with new features.
Under Card Business, the Bank took several initiatives to expand credit
and debit-cum-ATM card base. The total debit card base of the Bank
increased to 71.92 lakhs as at March 2012. Income under card business
during the year was at Rs 1.4 crore.
The Bank offers its depository services from 55 DP Service Centres
spread across 36 centres in the country. Through these Centres, the
Bank is extending Online Trading Facility to DP clients from its own
broking subsidiary M/s Canara Bank Securities Limited, Mumbai.
Executor, Trustee and Taxation Services outfit of the Bank provides
services like Debenture/Security Trusteeship, Will and Executorship,
Trusteeship, Personal Tax Assistance and Power of Attorney Services.
During the year, it secured new debenture/security trusteeship issues,
amounting to Rs905 crore.
Under Government Business, comprising Direct and Indirect Tax
collections, payment of pensions of various departments, Ministry
Accounts, Postal Department, Public Provident Fund Scheme and issue of
bonds of RBI and Government of India, the Bank earned an income of Rs76
crore during the year.
The Bank has been authorized as the accredited banker for Ministry of
Human Resources Development (MHRD), handling Department of School
Education and Literacy, Department of Higher Education, Department of
Arts - Archeological Survey of India, Ministry of Culture and Ministry
of Youth Affairs and Sports. The Bank has developed a Web-Portal for
Ministry of HRD fore-tracking of funds under the Sarva Shiksha Abhiyan
(SSA) Scheme and implemented the web portal in all the States. The Bank
has implemented the e-payment of sales tax/ commercial tax in the
states of Maharashtra, Tamil Nadu, Karnataka and Delhi.
The Bank is authorized as one of the accredited Bankers for Unique
Identification Authority of India (UIDAI), New Delhi. The UIDAI was
established in February 2010, as an agency of Government of India,
responsible for implementing the Multipurpose National Identity Card or
Unique Identification Card (UID Card) project in India. The project is
implemented in 8 Centres at present and the Bank's branches at these
Centres have been designated as the branches for handling the UIDAI
accounts.
During the year, the Bank has entered into an MoU with Ministry of HRD
for implementing Maulana Azad National Fellowship and National Scheme of
Incentives to Girls for Secondary Education (NSIGSE).
The Bank has implemented e-payment of Customs in 103 locations as
Per the direction of the Central Board of Excise and Customs, New Delhi,
with effect from 16.01.2012.
The Bank has introduced e-stamping project in 5 branches in Bangalore.
The project is under implementation at other 26 branches situated in
the District Head Quarters in the State of Karnataka.
Agricultural Consultancy Services (ACS) outfit of the Bank handled 105
assignments. These 105 assignments comprised of 75 appraisals, 1
viability study, 21 vetting and 8 other studies and trainings. The
total outlay of the assignments was Rs 467 crore.
ASSET QUALITY AND RISK MANAGEMENT
Asset Quality
The Bank has implemented system based identification in collation of
NPAs during the year, irrespective of size and category of the borrowal
accounts.
With the moderation in the economy, asset quality of the banking sector
was under stress. The gross NPA level of the Bank stood at Rs4032 crore
with a gross NPA ratio of 1.73% as at March 2012.The Bank's gross NPA
ratio continues to be one of the lowest among the peers. With a net NPA
level ofRs3386 crore, net NPA ratio was at 146%=The Provision Coverage
Ratio stood at 67.59% as at March 2012.
Cash recovery during the year aggregated to an all time high of Rs3295
crore, well exceeding the preceding year's cash recovery of Rs2032
crore. Out of this, recovery from written off accounts at branches,
write back and unapplied interest together amounted to Rs1191 crore.
Recovery from accounts where the liability is less than Rs1 crore was
Rs2000 crore.
During the year, recovery amounting to Rs1270 crore was made under
SARFAESI Act. The Bank conducted 17200 recovery meets which resulted in
a recovery of Rs 1575 crore. Under Lokadalat, 800 cases were settled.
Besides, the Bank took several initiatives to contain slippages and
speed up recovery from= overdue loan accounts. These include
identification of stressed accounts for restructuring/ rephasing in
time, conduct of Canadalats at branch level and mega adalats at Circle
level for one time settlements, regular follow-up of overdues in loan
accounts through Call Centre and e-auctions. The Bank also formulated a
special scheme for settlement of small NPAs and for MSMEs below =-lcrore.
Risk Management
The objective of Risk Management is to balance the trade- off between
Risk and return. The Bank weighs the business growth and revenue
generation in the context of the risks inherent in the business strategy
adopted.
The Bank has put in place a unified Risk Management Architecture to
attain global best practices for effective implementation of Risk
Management initiatives in tune with the New Capital Adequacy Framework
prescribed by the RBI. An independent Risk Management Structure is in
place for Integrated Risk Management, covering Credit, Market,
Operational and Group Risk.
The Board of Directors drive the Risk Management initiatives in the
Bank and have oversight on the risks assumed by the Bank. The Board of
Directors is well supported by the Risk Management Committee (RMC)
Of the Board.
Various Risk Committees at the Top Executive level like Credit Risk
Management, Market Risk Management, Operational Risk Management and
Asset Liability Management are also constituted and operationalized to
assist the Board and RMC of the Board. These Committees meet
periodically to assess and proactively review all policies related to
various risks and validating compliances, portfolio review on periodic
basis. The Audit Committee of the Board (ACB) provides direction to and
also monitors quality of internal audit functions and review of risk
policy initiatives. The Bank's business activities are undertaken
within the policy framework and independent departments are set up at
all levels to facilitate implementation of all risk initiatives of the
Bank.
The risk is managed through a framework of policies and principles
approved by the Board of Directors and supported by an independent Risk
Management Wing that ensures that the Bank operates within its risk
appetite as well as defined limits.
An independent Risk Management Wing at the Head Office is functioning
as a nodal centre for overall implementation of various risk management
initiatives across the Bank. Integrated Mid-Office of both Domestic as
well as Forex Treasury is functioning under the Risk Management for
effective and independent supervision and monitoring of Market Risk in
investment and forex functions. Risk Management Sections are
functioning at all the 34Circle Offices of the Bank as an extended arm
of the Risk Management Wing.
The Bank has put in place several Risk Management Policies. These
include policies on Credit Risk Management, Market Risk Management,
Operational Risk Management, Management of Conflicts of Interests,
Disclosures, Group Risk Management, Collateral Management, Outsourcing,
Corporate Governance, Investment, Compliance, Asset Liability, Credit
Monitoring etc. Besides the above, the Bank has put in place Risk
Management Policies for its overseas branches, taking into account the
requirements of the regulators i.e. Chinese Banking Regulatory
Commission (CBRC), Hong Kong Monetary Authority (HKMA), Financial
Services Authority (FSA) and Central Bank of Bahrain (CBB).
All the Risk Management Policies framed by the Bank are approved by the
RMC of the Board and Board of Directors at annual intervals. The
policies are also reviewed by the Audit Committee of the Board (ACB)
annually.
Migration to Basel II Norms: The Bank smoothly transited to Basel II
Norms as on 31.03.2008. The Capital to Risk Weighted Assets Ratio
(CRAR) is being calculated as per Pillar 1 requirement of Basel II
norms, adhering to the New Capital Adequacy Framework guidelines
stipulated by RBI.
The Bank has also put in place an Internal Capital Adequacy Assessment
Process Document (ICAAP) in place under Pillar 2 of Basel II Norms. The
ICAAP exercise covers the domestic, overseas operations of the Bank,
the subsidiaries, sponsored entities and associates. Linkages to Stress
Test Scenarios are also documented in ICAAP. The ICAAP document is
reviewed and approved by the RMCB and the Board of Directors.
As part of ICAAP, the Bank has conducted stress testing under various
hypothetical scenarios to assess effect on capital position. The
methodology is approved by the Board of Directors and submitted to RBI
annually as part of ICAAP. The stress test results are reported to the
ALCO/ CRMC periodically for various risks associated with liquidity and
credit risk.
A Capital Planning Committee is operational at Head Office and this
Committee articulates the macro economic scenarios vis-a-vis the
capital requirements of the Bank in tune with business strategies of the
Bank. The Committee ensures maintenance of appropriate level of CRAR
and evaluates various options for raising capital.
The Bank adheres to the Disclosure Norms in tune with
RBIguidelinesunderPillar3ofBasel II Norms. A Disclosure Committee is
functioning in the Bank, which ensures adherence to the Disclosure Norms.
The Bank has initiated necessary steps for moving over to Advanced
Approaches for computation of capital in Credit, Market and Operational
Risk.
Credit Risk Management
The Bank has a well defined Credit Risk Management Policy, which
defines credit risk and outlines the type of products offered, customer
categorization, target customers, credit approval / monitoring process,
exposure limits and risk appetite, approved by the Board of Directors.
The Bank has a scheme of' Delegation of Powers' approved by the Board of
Directors. The objective of Credit Risk Management Department of the
Bank is to maintain a healthy and robust credit portfolio and
Manage the credit risk inherent in individual exposures as well as at
portfolio level.
Risk Rating is pre-sanction tool for credit assessment, which provides
integrity, standardization and objectivity to the credit granting
process.
The Bank has several risk management systems for managing Credit Risk.
The various initiatives taken by the Bank areas under.
- A comprehensive Credit Risk Management Policy in tune with
Statutory and Regulatory guidelines is put in place.
- Specific rating definitions, processes and criteria in place
For assigning exposures to grades within a rating system.
- Four Credit Risk Rating Models are in place. These models have been
developed internally for rating borrowal accounts based on the exposure
limits. Rating of eligible accounts is made mandatory as a
pre-sanction exercise.
- Migration Analysis of rated accounts is done periodically.
- The Bank is using the ratings assigned by recognized External
Credit Assessment Institutions to optimize capital under Standardized
Approach.
- Pricing is Linked to both internal and external Credit Risk
Rating.
- Entry barriers / Hurdle Rate are fixed based on Credit Risk Rating.
- Well structured 'Delegation of Powers' to various authorities from
Branch level to Management Committee is in place. Credit Sanctioning
Powers are linked to Credit Risk Rating of Borrowers.
- To avoid Credit Concentration Risk, exposure ceilings for
single/group borrowers, substantial exposures, Term loans, unsecured
advances, exposure to various industries, NBFCs, Real Estate Sector,
Capital Market Sector are in vogue.
- Credit Administration and Monitoring Wing is formed to have focused
follow-up mechanism and to strengthen the loan
review/monitoring mechanism.
- The Loan Review Mechanism articulated in the Credit Monitoring
Policy of the Bank covers the entire gamut of review and monitoring to
Bean effective tool for evaluating the loan book continuously and intends
to bring out qualitative improvements in credit administration.
- Credit Audit System by external/ internal auditors of all
Borrowers accounts of Rs l Crore and above is in place.
Market Risk Management
The Market Risk framework of the Bank aims at maximizing the return by
providing inputs regarding the extent of market risk exposures, the
performance of portfolios vis-a-vis the risk exposure and comparable
benchmarks.
The Bank is computing Capital Charge for Market Risk on
Available for Sale'(AFS)and'Held for Trading'(HFT) portfolio under
investment by adopting Standardized Measurement Method.
Market Risk Management is governed by the Board Approved Policies for
Investment and other Policies.
Integrated Mid-Office at Risk Management Wing is monitoring Market Risk
Exposure. Exposure limits, such as, Stop Loss Limits on trading book,
Intraday and overnight limit for various currency positions,
Dealer-wise limits, Aggregate Gap Limit, Limits on Money Market
Operations, Modified-duration limits for investment portfolio and VaR
limits are fixed to act as risk mitigants/triggers. These limits along
with other triggers are tracked daily and necessary actions are
initiated. Reporting system has been strengthened for effective Market
Risk Management.
Towards implementation of Internal Models Based Approach for
calculation of Capital Charge for Market Risk, the Bank has put in
place a VaR based model for estimating General Market Risk. The process
of back testing of results generated by the model has been completed.
Stressed VaR is being calculated as per RBI guidelines on a weekly
basis. Stress testing exercise as per guide lines is under process.
Operational Risk Management
Operational Risk Management framework in the Bank is based on ethics,
organization culture and strong operating procedures, involving
corporate values, internal control culture, effective internal
reporting and contingency planning.
The Bank has adopted polices for Management of Operational Risk, which
covers various aspects, such as, Operational Risk Management Structure,
Insurance, Business Continuity Plan, Out sourcing and Legal Risks.
At present, the Bank is moving towards migration to Advanced
Measurement Approach (AMA) from Basic Indicator Approach of Basel II
framework. In AMA approach, the Bank can use its own method to assess
its exposure to operational risk, by identifying Key Risk Indicators
(KRI), by conducting Risk Control and Self Assessment (RCSA).
In this direction, the Bank has initiated following process/
Activities for implementation of Advanced Approaches.
- Mapped different products and services offered and activities
undertaken into eight business lines in Core Banking Software. The Bank
is in the process of evolving suitable Management Information System
for mapping of activities/ products to eight business lines in order to
compute Capital Charge for Operational Risk under the Standardized
Approach.
- Operational Loss events database is being strengthened, through
collection of loss data / near miss data through incident reporting,
which is made more comprehensive. Operational Risk Loss data are
collected since2006.
- Web based incident reporting package is in place to facilitate real
time reporting of Operational Risk Loss events occurring at Branches /
Offices.
- Identified audit related Key Risk Indicators, which is one of the
prerequisites for AMA.
- Vetting of New Products from operational risk angle, which is one
Of the standards of Operational Risk Management Framework (ORMF).
- The Bank has joined the loss data consortium proposed by I BA,
which provides the external incidents for scenario analysis and
internalization at the time of adoption of advanced approaches.
- Reporting mechanism for Risk Mitigants, such as, Insurance and
Outsourcing activities is in place.
- Collection of External Operational Loss events from sources, such
as, print media, internet etc, which can be used for development of
scenarios.
- Escalation of Operational Risk Loss events to Top Management as one
of the requirements of Advanced Approaches.
- Various risk mitigation measures are suggested on issues involving
Human Resources, Industrial Relations and Internal Control etc.
Asset Liability Management
An effective Asset Liability Management (ALM) system addresses issues
related to liquidity and interest rate risks to maintain a good balance
among spreads, profitability and long-term viability. The Board of
Directors of the Bank have constituted an Asset Liability Management
Committee (ALCO) to oversee ALM functions, including fixation of
interest rates for various components of assets and liabilities, its
composition, maturity and duration.
The ALCO meets regularly to discuss various issues pertaining to the
liquidity position by considering the residual maturity profile of
various assets and liabilities, takes stock of the dynamic interest
rate scenario, discusses at length the changes evolving in economic and
financial parameters, which have a direct bearing on the banking
industry and focuses on the impact of all these factors on the business
profile of the Bank.
The liquidity position of the Bank is tracked on a daily basis by means
of residual maturity of assets and liabilities. Periodical studies are
undertaken to analyze the behavioural patterns of various components of
assets and liabilities to estimate the liquidity on a dynamic basis.
The Bank's liquidity policy sets the tolerance limit for its
structural liquidity positions. The liquidity positions of overseas
branches are managed in line with home and host country regulatory
guidelines. Such positions are reviewed by the Bank's ALCO along with
domestic positions.
To evaluate the impact of changes in the market interest rate on
Bank's financial position, an analysis of Earnings at Risk (Impact on
profit assessed through Traditional Gap Analysis) and Market Value of
Equity (Impact on net- worth assessed through Duration Gap Analysis)
are done on an ongoing basis. Liquidity Stress tests are conducted at
periodic interval by simulating various stress scenarios.
Liquidity Risk Framework under Basel III
In view of the need to improve the liquidity risk management in banks,
the Basel Committee on Banking Supervision (BCBS) published "Principles
for Sound Liquidity Risk Management and Supervision" in September
2008 in the form of 17 high level liquidity principles.
To complement these principles, the Committee in December 2010 came out
with two new liquidity ratios viz., Liquidity Coverage Ratio (LCR) and
Net Stable Funding Ratio (NSFR)for funding liquidity.
The Bank's liquidity risk framework is broadly in tune with BCBS's
"Sound Principles". Further, the Bank has been computing the new
Basel III liquidity ratios viz., LCR and NSFR on a quarterly basis
since March 2011 as a part of BCBS Quantitative Impact Study (OIS). RBI
has recently issued draft guidelines for implementation of Basel III
norms by banks in India.
Group Risk
The Bank has various Subsidiaries, Joint Ventures, Sponsored Entities,
which are engaged in diversified activities. As the Bank has
considerable stake in these Group Entities, it has adopted a Group Risk
Management Policy approved by the Board. The main objectives of the
Policy areas under:
- To identify and manage risk in Intra Group Transactions and
Exposures.
- To raise the standard of Corporate Governance by reducing/avoiding
conflicts of interest between the Group Entities.
- To ensure Arms Length Principle' among the entities in regard to
business parameters.
The Bank has devised suitable reporting mechanism calling for necessary
feedback at quarterly intervals. Based on the feedback, the Risk
Management Wing of the Bank makes an assessment of risks faced by the
group entities including RRBs from Credit Risk, Operational Risk, Market
Risk, Liquidity Risk, Compliance Risk, Reputational Risk, Liquidity
Risk and Conflict of Interest perspectives and places a half-yearly
consolidated note before the Risk Management Committee with its
observations in the matter of compliance to the Group Risk Management
Policy and any specific issues, which would contribute to Group Risk.
NATIONAL PRIORITIES
Priority Sector Advances
The Bank continues to accord importance to varied goals under national
priorities, including agriculture, micro & small enterprises,
education, housing, micro-credit, weaker sections, SC/STs and
minorities.
Priority Sector Advances of the Bank as at March 2012 reached Rs67383
crore, covering over 43 lakh borrowers.
[Amt. in Rs Crore]
Priority Sector Advances As at Growth
March
2011 2012 Amount %
Total Priority Sector 62108 67383 5275 8.49
Agriculture 26305 31946 5641 21.44
Direct Agriculture 22154 27848 5694 25.70
With a focus on credit delivery to agriculture, the Bank's advances
under agriculture portfolio increased to reach Rs31946 crore, covering
over 35 lakh farmers.
Advances under Direct Agriculture stood at Rs27848 crore. The
Major accretion under Agriculture has been under Direct Agriculture. The
Bank has crossed the mandated level of 13.50% of ANBC, by reaching
13.83%. Advances to Direct Agriculture has increased by Rs5694 crore,
showing a growth rate of 25.7%. The Bank has taken up special campaigns
for extending Crop Loans/General Credit Cards (GCC) facility to all
farmers/non-farmers during Special Credit Campaigns for the period
01.09.2011 to 15.10.2011 and for the period from 01.01.2012 to
15.02.2012, as per the Government of India guidelines.
The Bank has disbursed Rs27327 crore under Agriculture, covering 33.93
lakh farmers during the financial year, registering an increase of 22%.
Since inception of the Scheme, the Bank has issued a total of 37.37 lakh
Kisan Credit Cards (KCC) amounting to Rs21698 crore. During the year, it
disbursed 3.67 lakh KCCs amounting to Rs4072 crore. As at March
2012,thecredit outstanding under KCCs was Rs6328crore.
Over the years, the Bank has supported lakhs of promising students to
pursue higher education in India and abroad. The Bank has further
increased its education loan portfolio which increased to Rs3948
crore. The Bank has financed more than 2.08 lakh students as at March
2012. The Bank is designated as the nodal bank for administering
subsidy under the Central Sector Scheme for Interest Subsidy on
educational loans.
During the year, the Bank also extended financial assistance to other
priority sectors, such as, state sponsored organization for SC/ ST,
housing and micro credit.
The Bank actively participated in various Government Sponsored Schemes,
such as, Prime Minister Employment Guarantee Programme (PMEGP),
Swarnajayanthi Gram Swarozgar Yojana (SGSY), Swarnajayanthi Shahri
Rozgar Yojana (SJSRY) and DRI. As at March 2012, the outstanding
advances under these schemes aggregated to Rs680 crore, involving
1.37 lakh beneficiaries.
Performance under various Government sponsored schemes
Name of the Scheme No. of Accounts Amt. in Rs Crore
PMRY 33654 196.28
PMEGP 4788 147.49
SGSY 41520 212.27
SJSRY 14348 65.00
SLRS 395 0.98
DRI 42215 57.71
Total 136920 679.73
In support of the underprivileged sections of the society, the Bank's
advances to SC/ST beneficiaries reached Rs4293 crore as at March 2012,
covering 4.64 lakh borrowers. The advances to SC/ST comprised 6.37% of
total priority sector advances.
Advances to weaker sections aggregated to Rs22333 crore, with a y-o-y
growth of 25.3%. Advances to weaker sections formed 11.09%of
ANBC against the norm of 10%.
Various components of Weaker Sections Advances as at March 2012 is as
under:
(Amt. in Rs crore)
No. Sectors Outstanding
1 Small & Marginal Farmers,
Landless Labourers, Tenant Farmers
and Share Croppers 19089
2 Artisans, Village and Cottage Industries 582
3 SC/ST Beneficiaries 4293
4 DRI Loans 58
5 SGSY Beneficiaries 212
6 SJSRY Beneficiaries 65
7 SHGs/NGOs/MFIs 1231
8 Advances to SLRS 0.98
9 Loans to Distressed Poor to repay
their debt to informal sector 0.07
As at March 2012, advances to specified minority communities aggregated
to Rs13220 crore, registering a growth of 12.8% and accounting for
19.62% of the total priority sector advances against the stipulated level
Of 15%.
MSME LENDING
Advances to Micro, Small and Medium Enterprises (MSMEs) reached Rs34893
crore as at March 2012. The Bank has covered 60661 accounts with an
exposure of Rs2013.59 crore as at March 2012 under the Credit Guarantee
Scheme of Credit Guarantee Fund Trust for Micro and Small Enterprises
(CGTMSE).
Considering the importance attached to MSME sector, the Bank has opened
additional 9 SME Sulabhs, i e., Centralized Loan Processing Units for
faster clearance of loan proposals and opened 4 Specialized SME
branches during 2011-12. As at March 2012, the Bank had 34 SME Sulabhs
across the country. It is proposed to open additional 10 SME Sulabhs
and 47 Specialized SME branches during 2012-13. With this, the Bank has
embarked upon reaching out to large section of MSMEs at all major
centres in the country. The Bank received an amount of Rs10.26 crore from
the Ministry of Micro, Small and Medium Enterprises, Government of
India, during the year as a Nodal Agency for Technology Upgradation of
SSI units under Credit Linked Capital Subsidy Scheme (CLCSS) and fully
utilized the amount during the year.
Under cluster based approach of lending to MSME sector, the Bank has
focused on adoption of select industrial clusters across the country.
With a view to supporting women entrepreneurs, the Bank has introduced
a scheme of financing under Micro and Small Enterprise Category to
women entrepreneurs with relaxation in margin, rate of interest,
processing charges etc., in respect of loans upto Rs5 lakh. During the
year, the Bank has introduced a scheme for financing Road Transport
Operators for purchase of vehicles of M/s Ashok Leyland Ltd. The
facility of on-line submission of Loan applications by Micro and Small
Enterprises was also introduced during the year.
Financial Inclusion
With the basic objective of bringing the large unserved population
Under the banking mainstream, the Bank is striving towards a more
inclusive growth by making financial products and services available to
the poor in particular. As per the Government of India and the Reserve
Bank of India directions, the Bank has been actively pursuing the
agenda of Financial Inclusion, with key interventions in four groups,
viz., expanding banking infrastructure, offering appropriate financial
products, making extensive and intensive use of technology and through
advocacy and stakeholder participation.
The Bank has successfully covered all the allotted 1618 villages
(spread across 23 States) with population above 2000 for providing
banking facilities. Under the Financial Inclusion Plan drawn by the
Bank, 206 villages were covered by providing Brick & Mortar Branch
facility (of which 167 financial inclusion
branchesopenedduring2011-12)and by engaging 1412 Customer Service
Providers (CSPs) under Business Correspondents (BC) model, which
includes 30 Ultra Small Branches opened in these Centres.
In a major thrust to financial inclusion, the Bank, on its Founder's
Day on 19th November 2011 issued 1.06 lakh Smart Cards, 25000 General
Credit Cards (GCCs), Credit linking of 5000 SHGs, opened 106 Farmers
Clubs and 15 Financial Literacy and Credit Counseling Centres (FLCCs)
on the occasion.
Business Canvassed in the NewFI Branches
The Bank opened 167 new branches at Financial Inclusion villages. This
worked out to 48% of the 342 branches opened by the Bank during 2011-12 as
against RBI stipulation of 25% of new branches required to be opened in
tier V and VI centres. The branches opened in the financial inclusion
villages also showed good results with more than 4 lakh accounts, Rs405
crore business translating into an average of 2395 accounts per branch
and Rs 2.43 crore business per branch.
No Frill Accounts
The Bank opened about 17 lakh no-frill accounts during the year with an
accretion of Rs300 crore in the no-frill accounts. The total number of
no-frill accounts in the Bank at the end of 2011-12 reached 44 lakh
with a balance of Rs820 crore. On an average, the Bank covered about
1000 accounts per village. The Bank's endeavor is to credit link at
least 50% of all the eligible beneficiaries through KCC,GCC and DRI
Schemes during2012-13.
Information and Communication Technology (ICT) Model Under ICT Model,
the Bank canvassed 6.5 lakh no-frill accounts during the year through
Customer Service Providers (CSPs) engaged by Bank's Business
Correspondents. The Bank issued Smart Cards to 2.14 lakh customers.
Micro Insurance
The scheme was originally launched to cover women SHG members for
insurance. The member of SHGs gets coverage ofRs25000 by paying an annual
premiumofRs100.Thescheme has now been extended to all members of SHGs
irrespective of gender. During the year, the Bank extended Micro Insurance
Schemetomorethan20000customers.
Micro Pension
The Bank is also implementing Pilot Micro Pension Scheme in association
with NABARD and M/S Invest India Micro Pension Services (IIMPS) in
Madurai District of Tamil Nadu.
Electronic Benefit Transfer (EBT)
The payment of wages under Mahatma Gandhi National Rural
Employment Guarantee Act (MGNREGA) and Social Security Pension has been
taken up in four districts of Karnataka under EBT. In two districts
of Tamil Nadu, the Bank is participating in pilot projects for Old Age
Pension payment and in Nadauta Village of Agra District, the Bank is
participating in Pilot Project for MGNREGA payments.
AADHAAR Enrolments
Pilot Project for Aadhaar enrolments has been undertaken in 8
States,coveringl.95 lakh residents.
Micro Finance Branches
The Bank has opened 19 Micro Finance Branches in urban centres, which
contributed a total business of Rs 150 crore.
Financial Literacy and Credit Counselling Centres (FLCCs)
The Bank has set up FLCCs in 24 districts. The Bank sponsored RRBs
viz., Pragati Gramin Bank (PGB) and Shreyas Gramin Bank (5GB) set up
one FLCC each in Shimoga and Etah respectively. With this, the Bank has
set up FLCCs in all the 26 Lead Districts. The Bank registered a new
trust by name "Canara Financial Advisory Trust" for managing the FLCCs.
Farmers'Club
During the financial year, 151 Farmers' Clubs were formed. Presently,
the Bank has about 1360 farmers' clubs all over the country. These
farmers' clubs disseminate information to the rural people about the
banking products and advanced technology.
Canara Gramin VikasVahini
The Bank has provided Canara Gramin Vikas Vahini (Vehicles) in 35
districts across the country, with an objective of providing awareness
about Bank's products and banking facilities among the rural households.
Bio-metric ATMs
During the year, the Bank has installed six Bio-metric ATMs, taking the
total to 29. These Bio-Metric ATMs enable the rural illiterate
customers to access their accounts, using biometric features like
finger prints and with draw the amount or get balance confirmation, using
colorcodes.
Credit Linkage
The Bank has not limited its activity in financial inclusion for
opening of No-frill accounts alone. Besides No-frill accounts, the Bank
has endeavored to provide host of other facilities like General Credit
Cards (GCCs), Differential Rate of Interest (DRI) Scheme, Self Help
Groups (SHGs), Micro Credit Groups (MCGs), Micro Insurance and Micro
Pension under Canara Nayee Disha Scheme.
- GCC: Extending credit under financial inclusion, the Bank has so
far issued 4.19 lakh GCCs, amounting to Rs727 crore.
- SHGs: The Bank has so far formed 3.71 lakh SHGs as at March 2012,
with credit linking of 3.59 lakh SHGs.
- Under the intensive SHG improvement for women's SHGs, Canara Bank
has been allotted Waynad in Kerala and Chitradurga in Karnataka and in
both the districts anchor NGOs have been identified viz., M/s Waynad
Social Service Society in Waynad and M/s SKDRDP in Chitradurga. Anchor
NGOs have started formation of Groups and openingoftheiraccounts in
Both the districts.
Canara Mega Rural Outreach Utsavs
Canara Mega Rural Outreach Utsavs have been held in 13 States. Besides
providing basic bank accounts, the Bank has given thrust on disbursement
of Consumption Credit through GCC, extension of Farm Credit through KCC,
Skill updation and Livelihood Creation activities through Financial
Literacy, Financial Awareness and Financial Support Programme. Holistic
financial inclusion has been achieved by providing other facilities
like Micro insurance and Aadhaar Enrolments.
Position of Financial Inclusion in the sponsored Regional Rural Banks
All the three sponsored RRBs implemented financial inclusion plan in
all 968 allotted villages by opening 30 'Brick and Mortar' branches
and engaging 938 Customer Service Providers (CSPs) under Business
Correspondents (BC) model, which includes 3 Ultra Small Branches opened
in these Centres.
Lead Bank Scheme
Canara Bank has lead bank responsibilities in 26 districts in the
country, viz., eight in Karnataka, seven in Tamil Nadu, five in
Kerala,five in Uttar Pradesh and one in Bihar. The Bank works as the
Convenor of the State Level Bankers' Committee (SLBC) in the State of
Kerala.
Entrepreneurship Development among Women
Centre for Entrepreneurship Development for Women (CEDW) at Head
Office, Bangalore and Centres at 34 Circle Offices are working towards
economic empowerment of women. These Centres conducted several training
programmes during the year, including general Entrepreneurship
Development Programmes (EDP), Entrepreneurship Awareness programmes,
Seminars, Career Guidance programmes, Skills and provided marketing
Support to women entrepreneurs by organizing Canutsav /Canbazar. CEDW
cells have also assisted in formation of SHGs and credit linkages.
A Rural Self Employment Training Institute has been set up at Harohalli
to provide EDP skill trainings to women in various vocations and enable
them to take up self employment ventures. The Institute has so far
trained 14836 women in EDP skill since inception.
CORPORATE SOCIAL RESPONSIBILITY
Following the century old tradition and founding principles, the Bank
is engaged in varied Corporate Social Responsibility (CSR) activities.
CSR initiatives of the Bank are multifarious, covering activities like
training unemployed rural youth, providing primary health care,
drinking water, community development, empowerment of women and other
initiatives.
Rural Development
The Bank, through its Canara Bank Centenary Rural Development Trust
(CBCRDT), has established 30 exclusive training institutes, including
23 Rural Self Employment Training Institutes, to promote
entrepreneurship development among rural youth and encourage them
taking up self-employment activities. During the year, a training
institute in the field of Information Technology was opened at
Berhampore, West Bengal. During 2011-12, these training institutes
trained 24072 candidates, taking the tally to about 1.49 lakh
unemployed youth since inception, with an impressive settlement rate of
73%.
The Bank has co-sponsored 26 Rural Development and Self Employment
Training Institutes (RUDSETIs) across 16 States, engaged in training of
rural youth for taking up self-employment programmes. During 2011-12,
these institutes trained 26370 candidates. These RUDSETIs have, so far,
trained over 2.86 lakh unemployed youth, with a settlement rate of 71%.
Besides the above 26 RUDSETIs, the Bank has co-sponsored Andhra Pradesh
Bankers Institute of Rural Development with Government of Andhra
Pradesh at Hyderabad and Deshpande-RUDSETI at Hailyal, Karnataka. The
Bank has supported the setting up of Entrepreneurship Development
Training Institute at Jammu and Kashmir.
Canara Bank's Rural Clinic Service Scheme provides incentives to
doctors for providing basic health care services in remote areas
lacking basic medical facilities. As at March 2012,thetotal number of
such clinics rose to 565.
The Bank has donated a hi-tech, custom built, solar powered 'Mobile
Sales Van' to assist women entrepreneurs, SHGs and artisans to market
their products.
During the year, the Bank's Social Action Cell organized blood
donation camps, health camps and assisted people affected by natural
calamities and challenged section of the society. It has also
encouraged students by conducting various programmes and activities.
Visits by Parliamentary Committees
During2011-12, Parliamentary Committee on Sub-ordinate Legislation
(Rajya Sabha) and Parliamentary Committee on Government Assurance
(Rajya Sabha) visited the Bank.
ORGANISATION AND SUPPORT SERVICES
Branch Network
Continuing its major branch expansion drive, the Bank added 342
domestic branches during the year. This includes 106 branches and 106
ATMs opened across the country on 19th November, 2011 to commemorate
the Bank's Founder's Day and 106th year of service to the nation.
The Founder's Day function was graced by the Hon'ble Union Finance
Minister, Shri Pranab Mukherjee. The Bank opened an overseas branch at
Manama, Bahrain and a Representative Office at Sharjah during the year.
As at March 2012, the Bank had 3600 branches, including 5 overseas
branches.
Composition of Branch Network
No. of Branches
Category 31.03.2011 31.03.2012
Metropolitan 758 777
Urban 762 792
Semi-urban 922 1019
Rural 811 1007
Overseas 4 5
Total Branches 3257 3600
The Bank has 145 specialized branches, catering to the specific
clientele segment.
Categories of Specialized Branches 31.03.2012
I.SMEs 53
2.Overseas 16
3.Agri-Finance 10
4.Micro Finance Branches 19
5.Savings 6
6.NRIs 7
7.Asset Recovery Management 8
8.PrimeCorporate 10
9.Industrial Finance 4
10.Stock Exchange 3
II.Capital Market 3
12.Mahila Banking 2
13.Consumer Finance 1
14.Housing Finance 1
15.Branch for Physically Challenged 1
16.Specialized Govt Business Branch 1
TOTAL 145
InfoTech Progress
The Bank took several initiatives on the InfoTech front during the
year. The Bank covered all its branches/offices under Core Banking
Solution (CBS). The Bank now offers several technology banking
services, such as, Internet Banking, Mobile Banking,
Funds Transfer through NEFT and RTGS, SMS Alerts, IVRS based enquiry
across all its branches. The Bank also offers online trading facility
to its clients through its own subsidiary M/s Canara Bank Securities
Ltd.
As at March 2012, the Bank had 2858 ATMs spread across 1139 centres.
During the year, the Bank added 642 ATMs. Funds Transfer through IMPs
(Inter Bank Mobile Payment Services) has been enabled through the ATMs.
During the year, the ATMs have also been enabled to offer value added
services like direct tax payments and institutional fee payment
facility' ATM facilities have been extended to customers of the Banks 3
sponsored Regional Rural Banks (RRBs).
The Bank has made a few value additions under internet banking that
include enabling ASBA facility to internet banking users, facility of
viewing the details of tax deducted at source, e-filing of tax returns,
funds transfer facility for corporate customers and internet and mobile
banking gateway for Government business. Customer Terminal facility has
been provided in 223 branches for enabling customers to use facilities
like internet banking from a dedicated terminal provided at the branch.
Several new investor friendly features have been enabled under online
trading including ASBA.
SMS/ E-mail alerts have been enabled for various transactions like
ATMs, Net banking, Point of Sale (PoS), Mobile banking, online payments
made through debit cards on internet, irrespective of the amount. Online
loan application for retail and MSME through internet and
tracking facility for the customer has been implemented.
Further, the Bank has made a number of advancements in payment systems
including auto reversal of NEFT service charges and extending NEFT
facilities to 3 sponsored RRBs. Several Government business modules
were implemented including internet based application for
UGCMaul and Azad National Fellowship Scheme, Web Portal for National
Scheme for Girl Child Secondary Education, Electronic Accounting
Systems of e-Receipts-Customs (EASeR-C) for collection of customs duty
and e-payment of Commercial Taxes module for Uttar Pradesh, Karnataka,
Delhi and Tamil Nadu.
The Bank has introduced Financial Supply Chain Management (FSCM)
facility to corporate customers - a technology product for Channel
finance to extend working capital finance to the suppliers as well as
dealers of corporate clients.
Passbook printing through self service Kiosk has been provided at 5
pilot locations. Other functional value additions include issue of
non-personalized debit cards on opening of CASA account, facility of
automatic sending of CASA pass sheets through e-mail and automatic
renewal of term deposits. The Bank has initiated the process of
Automated Data Flow (ADF) to the RBI and is scheduled to be completed
during2012-13 as per the time line stipulated by the RBI. During the year,
the Bank embarked on a very important project, namely, Enterprise-wide
Data Warehouse (EDW). The project has already been initiated with
requirement from all functional Wings for setting up an effective EDW
architecture loaded with Business Intelligence/ Business Analytics
modules for management decision support and business expansion.
As per the RBI Working Group (Chairman, Shri G Gopalakrishna) Report on
Information Security, Electronic Banking, Technology Risk Management
and Cyber Frauds, the Bank has conducted a Gap Analysis vis-a-vis the
recommendations. Out of the 71 recommendations, 67 recommendations stand
fully implemented in the Bank as at March 2012. The remaining 4
recommendations are under various stages of implementation and will be
completed within the timeline permitted by the RBI i.e., 31.10.2012.
Manpower Profile
As at March 2012, the Bank had 42272 employees on its rolls.
March March
2011 2012
Total No. Of Employees 43397 42272
Officers 17649 17419
Clerks 16178 15802
Sub-Staff* 9570 9051
* includes part-time employees (PTEs)
The Bank's staff comprised 41.2% Officers, 37.4% Clerks and 21.4%
Sub-Staff. Women employees comprising 10256, constituted 24.3% of the
Bank's total staff. The Bank recruited 517 women employees and promoted
186 women employees under various cadres during the year.
During the year, the Bank recruited 1188 persons in various cadres, out
of which 269 belonged to Scheduled Castes (SCs) and 54 to Scheduled
Tribes (STs) categories. The total number of ex-servicemen staff as at
the end of March 2012 stood at 1703. Out of which, 151 were recruited
in various cadres during the year. There were 886 Physically Challenged
Employees on the rolls of the Bank.
Reservation Policy in respect of SCs and STs
As at March 2012, the number of Scheduled Castes and Scheduled Tribes
together constituted 26% of total staff strength of the Bank. The
composition of SC/ST employees in the Bank as at March 2012 was as
under:
Scheduled Scheduled
Cadre Castes Tribes
Officers 3162 1139
Clerks 2817 910
Sub-staff PTEs 2542 404
Total 8521 2453
The Bank has been strictly adhering to the Reservation Policy in respect
of Scheduled Castes and Scheduled Tribes as per the Government of India
guidelines.
(a) Reservation Policy is implemented through mechanism of Post Based
Rosters. In terms of the directives of the Ministry of Finance,
Government of India, the Bank has since switched over to Post Based
Rosters for all cadres.
(b) The Bank has been extending Reservation/ Relaxations/ Concessions
in Direct Recruitment as well as in promotions to candidates
belonging to Scheduled Castes and Scheduled Tribes as per the Government
guidelines.
(c) Pre-recruitment and pre-promotion training is given to candidates
belonging to Scheduled Castes and Scheduled Tribes. In the
advertisement inviting for the application from the eligible candidates
for recruitment to Clerical and Officer cadres, a specific reference is
made with regard to imparting of pre-recruitment training to candidates
belonging to SC / ST / PWD / Minority Communities / Ex-SM. Those
candidates, who opt for pre-recruitment training, are given training to
prepare themselves for written test as well as interview.
Study materials, note book, stationeries are provided free of cost to
all the participants. Wherever possible, respective State Governments
are also providing the lodging facilities in Government / Backward
Class Hostels.
(d) The Bank has set up SC/ST Cell at the Head Office and also at
Circle Offices to ensure maintenance of Rosters and implementation of
other aspects of Reservation Policy.
(e) Chief Liaison Officer has been nominated at Head Office and Liaison
Officers have been nominated at Circle Offices for ensuring
implementation of Reservation Policy.
Further, representations received from Scheduled Caste / Scheduled
Tribe employees, either directly or through the SC/ST Associations, are
being looked into by the Liaison Officer/Chief Liaison Officer. Wherever
required, necessary enquiries are conducted and appropriate action
is taken. A separate register is maintained for recording various
representations received from Scheduled Caste/ Scheduled Tribe
employees and the action taken is also recorded in the register.
In addition to the above, the representatives of majority Scheduled
Caste/ Scheduled Tribe Employees' Association are invited for Quarterly
Meeting with the Chief Executive of the Bank to discuss on the
implementation of guidelines on reservation policy. Quarterly Meetings
are also held at Circle Offices, where Rosters are maintained and
grievances, if any, are redressed by the Liaison Officer.
(f) The Board of Directors of the Bank also review the progress made in
the implementation of Reservation Policy, half yearly and yearly
basis.
Training / Human Resource Development (HRD)
The HR policies of the Bank have been revisited to suit the changing
banking scenario. HR interventions like SPANDAN for bringing
attitudinal change among front line staff, PRATIBHA for grooming
in-house talents in varied specialized areas and Executive grooming
through reputed institutes and other significant HR tools like Quality
Circles, Study Circles, Staff Meetings and Brain Storming Sessions have
been implemented for effective team building and fostering collective
excellence.
The Bank's quest to enhance the competencies of the workforce
continued through focused and need based trainings at various
institutes of repute like IIMs, I SB, XLRI and NIBM. Customized
programmes are also being organized to develop expertise in certain
niche areas like Risk Management, Treasury Operations and IT.
Specialized trainings to the Senior Management Level / Top Management
Level Executives are conducted based on the requirement. The Bank has
been able to add substantially to the skill level of its officials
through this training intervention and motivating them to perform with
renewed vigor and enthusiasm. The Bank has trained 29120 employees
during the year, covering a wide range of functional areas. Out of the
trained staff, 7114 personnel belonged to the Scheduled Caste category
and 1962 under the Scheduled Tribe category. Several new training
programmes were conducted during the year for various levels of
Officers and SC/ST employees. These include training on customer
service, risk management, product awareness, frauds and preventive
vigilance, financial inclusion, KYC/ AML, credit appraisal and
monitoring and transaction banking.
Establishing a proper Talent Management and Reward System will be the
Bank's focus in the coming years. There will be concerted efforts to
identify potential leaders and groom them to take up higher
responsibilities.
The Bank has formed a Sub-Committee of the Board of Directors on HR to
review and improvise the existing HR policies and make suggestions to
accelerate the employee engagement initiatives.
Changes in the Organizational Setup
The organizational design and structure are continuously revisited and
Studied for functional excellence.
Taking cognizance of the need for greater emphasis in managing
technology risk and to develop fraud prevention methodologies in the
organization, Technology Risk and Fraud Prevention Wing was formed
during the year. Post re-organization, there are 21 Wings at Head
Office.
Customer Orientation
The Bank has taken several initiatives to remain customer focused
through providing fast service, bringing in diversified
products/services, responding to customers' queries and redressal of
customers' complaints. The 'Code of Commitment to Customers' issued
by BCSBI is made available in the Bank's website. In order to assess
the quality of customer service rendered by the branches and to get
feedback, a 'Contact Questionnaire' is made available in the
Bank's website. During the year, a Customer Fortnight was conducted
from 15.11.2011 to 29.11.2011 in order to invite suggestions from
customers. Toll Free contact at Customer Service Section, Head Office
is provided to facilitate the customers to represent their grievances.
Toll Free contact facility at ATM Switch Room and Card Division is also
provided to the users to represent the matters pertaining to ATM
operations and Card Business. Notably, the Bank has implemented online
grievance redressal through the Bank's website. As a part of Customer
Relationship Management initiatives, a Call Centre is functioning. The
Call Centre caters to the customers in Hindi, English and 6 regional
languages viz., Kannada, Tamil, Telugu, Malayalam, Bengali and Marathi.
The number of calls received by the Call Centre during the year was more
than 8.52 lakh. In financial year 2011-12, percentage of customer
complaint redressal was 95.10%. All complaints were redressed within
stipulated period. As far as cases referred to the Banking Ombudsman is
concerned, the percentage redressal of complaints was 91.83%. The Bank
has implemented 88 out of the 107 recommendations of Damodaran Committee
accepted by the Indian Banks' Association.
Systems and Procedures
Risk Based Internal Audit (RBIA) was conducted in 2368 branches/ units
programmed for on-site RBIA during the year. Information Security Audit
was conducted along with RBIA. Concurrent/ Continuous Audit is being
conducted in 539 identified branches/ units (covering 61.5% of deposits
and 77.4% of advances) of the Bank as per RBI guidelines as on
31.12.2011. Income/revenue audit was conducted on quarterly basis in
379 identified branches as per Jilani Committee Recommendations.
Apart from the above, 414 branches were subjected to Special Income
Audit. The Bank introduced new fraud prevention measures viz., offsite
monitoring system to track exceptional transactions and offsite RBIA of
the branches on an experimental basis.
Know Your Customers (KYC)
The Bank took several measures for the effective implementation of Know
Your Customer (KYC) and Anti Money Laundering (AML) guidelines and for
ensuring KYC compliance by all branches.
To ensure better compliance of guidelines on KYC / AML, following steps
have been initiated.
- The Bank has ensured 100% submission of Cash Transaction Reports
(CTRs) and Non Profit Organizations Transaction Report (NTR) to
Financial Intelligence Unit (FIU).
- Suspicious Transaction Reports (STRs) and Counter fiet Currency
Reports (CCRs) are submitted to FIU, as and when received from
branches.
- Snap Audit is conducted on monthly basis in 2-3 branches in each
Circle at random to verify adherence to KYC norms.
- Snap Audit for verification of KYC Compliance conducted in all the
financial inclusion branches opened during2011-12.
- Software for system based centralized risk categorization of
customers is currently under development as per the AML guidelines.
Vigilance Setup
The Vigilance Wing of the Bank is headed by the Chief Vigilance Officer
(CVO) in the rank of General Manager. The CVO is assisted by 34
Vigilance Officers stationed at all Circles, RRBs and Bank's
Subsidiaries. The objectives of the Vigilance Wing are to ensure that
discipline and development go hand in
Mar 31, 2011
The Board of Directors have pleasure in presenting the 42nd Annual
Report together with the Balance Sheet as on 31st March, 2011 and
Profit and Loss Account for the financialyearended March 31,2011.
FINANCIAL PERFORMANCE
For Canara Bank, 2010-11 was a year of robust performance on the
business, profits and profitability fronts.
Net profit reached an all time high ofRs.4026 crore, signifying a
strong 33.2% growth y-o-y and substantially higher than Rs.3021 crore
recorded duringthe preceding year. Operating profit recorded a 20.7%
growth to reach a level of Rs.6107 crore. Return on average assets
(RoAA) for the year improved to 1.42%. Profit per employee, moved up to
Rs.9.76 lakh compared to Rs.7.35 lakh in the previous financialyear.
Dividend of 110% for 2010-11
Enhancing Shareholder Value:
The Bank showed steady improvement in Earnings PerShare (EPS) and Book
Value. While Book Value increased to Rs.405 as at March 2011 as
compared to Rs.305.83 for the previous financial, EPS rose to Rs.97.83
as at March 2011 compared to Rs.73.69 a year ago. Ensuring increased
value for the shareholders year after year, the Banks Board of
Directors recommended a dividend of 110% for 2010-11 compared to 100%
last year.
March March
Key Financial Ratios (%) 2010 2011
Cost of Funds 5.65 5.37
Yield on Funds 8.10 8.13
Cost of Deposits 6.12 5.80
Yield on Advances 9.81 9.73
Yield on Investments 7.52 7.72
Spread as a % to AWF 2.45 2.76
Net Interest Margin (NIM) 2.80 3.12
Operating Expenses to AWF 1.50 1.56
Return on Avg. Assets (RoAA) 1.30 1.42
Return on Avg. Networth 26.76 28.26
Business per Employee (Rs. in Crore) 9.83 12.28
Profit per Employee (Rs.in Lakh) 7.35 9.76
Book Value(Rs.) 305.83 405
Earnings perShare(Rs.) 73.69 97.83
AWF - Average Working Funds
Income and Expenditure Analysis
The Banks interest income recorded a y-o-y growth of 23% to reach
Rs.23064 crore compared to Rs.18752 crore recorded during the previous
financial year. Non-interest income increasedtoRs.2703 crore.
Despite increase in interest rates, the Bank could reduce the cost of
deposits by 32 bps to 5.80% compared to 6.12% a year ago, while yield
on advances maintained at 9.73%. Interest spread increased to 2.76%from
2.45% as at March 2010.
While interest expenditure increased to Rs.15241 crore with a y-o-y
growth of 16.6%, the Banks operating expenses increased by 27.1% to
reach Rs.4419 crore. Notably, the net interest income of the Bank
registered a good 37.7% growth to reach Rs.7823 crore and Net Interest
Margin (NIM) improved by 32 bps to 3.12% compared to 2.80% as at March
2010.
Capital and Reserves
Networth of the Bank, as at March 2011 increased to Rs.17941 crore
compared to Rs.12539 crore as at March 2010. While total paid-up
capital of the Bank increased to Rs.443 crore from Rs.410 crore last
year, reserves and surplus increased to Rs.19597 crore. To augment the
capita resources, the Bank raised upperTier II bonds to the extent of
Rs.1000 crore and Rs.749.3 crore under Innovative Perpetual Debt
Instrument. For the first time, the Bank raised equity capital through
Qualified Institutiona Placement (01P) route for Rs.1993.2 crore. Post
01P, Government Shareholding in the Bank came down from 73.17% at March
2010to67.72%asat March 2011.
(Amt. in fCrore)
March 2010 March 2011
Composition of Capital Basel II Basel II
Risk Weighted Assets 150623 176136
Tierl Capital 12870 19139
CRAR(%)(TierI) 8.54 10.87
Tierll Capital 7362 7956
CRAR (%)(Tier II) 4.89 4.51
Total Capital 20232 27095
CRAR(%) 13.43 15.38
As at March 2011, Capital to Risk Weighted Assets Ratio (CRAR) of the
Bank under Basel II significantly improved to 15.38%, with a Tier I
capital ratio of 10.87%. The Bank has still adequate headroom available
under both Tier-I and Tier-ll options to raise capital to support
business growth momentum.
Deposits
Total Deposits of the Bank registered a growth of 25.3% to reach
Rs.293973 crore as at March 2011 compared to Rs.234651 crore a year
ago. The Banks CA5A deposits grew by 21.8% to reach Rs.83117 crore as
at March 2011. Savings deposits rose by 17.5% y.o.y to Rs.58617 crore.
The Bank opened over 24 lakhs SB clientele during FY11. During FY11,
the Bank had launched a nationwide Savings Mahotsav campaign to
mobilize SB deposits, resulting in fresh addition of over 16 lakhs
SBclientele.
With a CA5A per branch at Rs.25.52 crore, the Bank continues to be one
of the best among the peers. Pursuing a strategy of broad basing
deposit clientele, all the branches together opened over 64 lakhs
deposit accounts, taking the total tally under deposit accounts to 3.42
crore.
Advances (Net)
During FY11, the Banks net advances witnessed a robust 25.5% growth to
reach Rs.2,12,467 crore compared to Rs.1,69,335 crore a year ago. In
quantum terms, credit increased by over Rs.43,000 crore during the
year. The Banks diversified credit portfolio include all productive
segments of the economy like agriculture and Micro, Small and Medium
Enterprises (M5ME), exposure to corporate and infrastructure segments.
As at March 2011, the number of borrowal accounts stood at 45 lakhs.
25% Growth in Total Business for last 3 Years
The Bank has recorded a Compounded Annual Growth Rate (CAGR) of 25% for
the last 3 financial years. During 2010-11,the total business of the
Bank grew by a robust 25.4% to reach Rs.5,06,440 crore as against
Rs.4,03,986 crore during the previous financial. Productivity, as
measured by business per employee, increased to Rs.12.28 crore from
Rs.9.83 crore a year ago, continuing to be one of the best amongthe
peers.
During the year, the Banks clientele base increased to 3.87 crore.
Retail Lending Operations
Retail lending operations of the Bank registered a strong 32% to reach
Rs.31572 crore as at March 2011, accounting for 15.52% of the domestic
credit. The disbursals under the retail lending stood at Rs.13826
crore. The outstanding housing loan portfolio increased to Rs.15219
crore, constituting 48% of the total retai lending portfolio.
(Amt. in Rs.Crore)
Retail Lending March 2010 March 2011 Growth (%)
Retail Lending 23902 31572 32.1
Housing Loans 10116 15219 50.4
Retail Trade 5383 6313 17.3
Other Personal
(Incl. Education
Loan) 8403 10040 19.5
The Bank took several measures du ring theyear to expand retail credit.
To facilitate speedy disposal of proposals and cred it flow, a total of
25 Centralized Processing Units (CPU) and 16 Retail Assets Hubs (RAH)
for housing and other retai loans a re functioning at major centres
across the country
TREASURY AND INTERNATIONAL OPERATIONS
Aggregate investments of the Ba n k, as at Ma rch 2011, were of the
order of Rs.83700 crore. Portfolio modified duration (years) came down
to 4.75 as at March 2011 from 4.95 a year ago. The modified duration of
the Available for Sale (AF5) portfolio has increased from 1.93 as at
March 2010 to 2.23 as at March 2011 due to redemption of short dated
securities and fresh investments made in medium and long dated
securities. The trading profit for the year was Rs.293 crore. The yield
on investments improved to 7.72% as at Ma rch 2011 as compared to 7.52%
a year ago.
The Bank continues to be an active player in government securities as a
primary dealer. The total amount of underwriting commitments fortheyear
was Rs.33216 crore. During theyear, the Bank achieved over 55% success
ratio as against mandatory 40% of itsobligationasa Primary Dealer.
Foreign Business Turnover of the Bank, as at 31st March 2011,
aggregated to Rs.1,24,094 crore, comprising Rs.45,658 crore under
exports, Rs.39,616 crore under imports and Rs.38,820 crore under
remittances. Outstanding export credit
oftheBankwasRs.10489crore,withay-o-ygrowth of 17%.
The Banks overseas presence covered four branches one each at London,
Hong Kong, Leicester (UK) and Shanghai as at March 2011. Leicester
branch was opened on 12th April 2010 and the Representative Office at
Sharjah was opened on 20th June 2010. Besides, a joint venture bank,
namely, Commercial Bank of India LLC in Moscow is also operational in
association with State Bank of India.
All overseas branches recorded improved business performance during the
year. Total business of these 4 overseas branches aggregated to US $
4376 million for thefinancia I yea rending Ma rch 2011.
To fund overseas assets expansion, the Bank raised foreign
currencyfundsof USD 350 millionthrough London branch by issuing senior
unsecured bonds listed in Singapore Stock Exchange under MediumTerm
Notes Programme.
The Bank has approval from RBI for expansion in 8 other international
centres viz., Manama (Bahrain), Qatarjohannesburg (South Africa),
Frankfurt (Germany), New York (USA), Sao Paulo (Brazil), Dar-es-Salaam
(Tanzania) and Tokyo (Japan). The Bank has conducted survey in Sri
Lanka, Kenya and Nigeria to explore opening of branches in these
countries.
The Banks international operations are well supported by a wide
network of 382 Correspondent Banks, spread across 80 countries. The
Bank has rupee drawing arrangements with 22 exchange houses and 17
banks in the Middle East for channelising the remittances of
expatriates. The Bank has been managing two exchange houses viz., Al
Razouki International Exchange Company, Dubai and Eastern Exchange
Est., Qatar, under secondment and management agreement respectively.
The Bank, during the year, expanded its arrangement underRemit Money,
a web based product by extending to 18 Exchange Companies/Banks and 4
branches abroad viz., London, Leicester, Shanghai and Hong Kong. During
the year, the Bank obtained approval from RBI for remittance
arrangements with 5 more Exchange Houses in UAE. It also introduced
lock Box Service for quick collection of cheques drawn by NRIs on
Banks in the USA. One more Remittance Product Remit Worlwidefor NRIs
in the USA is on the cards and will be introduced shortly.
OTHER SERVICES
During 2010-11, Merchant Banking Division of the Bank handled Private
Placement of Capital Gain Bond Issues in respect of National Highways
Authority of India (NHAI) and Rural Electrification Corporation Ltd.,
(REC) as Arrangers. Amount mobilized by Merchant Banking Division in
respect of Capital Gain Bonds Issue of NHAI and
RECwasRs.120crore.TheBanksTierl Bonds Issue (IPDI) a mounting to
Rs.500 croreand Upper Tier II series III bonds issue amounting to
Rs.1000 crore was also dealt by the Division in preparing/compiling the
Disclosure Documents in terms of SEBI guidelines. During the period, it
handled 5 specialized assignments ofFairValuation of Equityand 8
Bankers to an Issueassignments as Escrow Bankers/ Collecting Bankers
with total float funds, amounting to Rs.3034 crore. The Division
facilitated implementation of Application Supported by Blocked Amount
(ASBA), a supplementary process of applying for Public/Rights issues
with effect from 1st September 2010 as per SEBI guidelines. Ason date,
152 branchesacrossthe country have been designated for ASBA facility.
The Syndication Group handled projects involving cost of Rs.9604 crore
during the year, with a total debt size of Rs.5240 crore. The Group has
generated substantial fee based income from syndication operations and
arranged funds for projects in diverse segments like Steel, Power,
Hotel, Road, BusTerminal and Sugar.
The Bank has tie-up arrangements in both life and non-life insurance
segments under its bancassurance arm. The Bank earned a commission
income of Rs.51 crore from Canara HSBC Oriental Bank of Commerce Life
Insurance Company Limited. The Bank has tie up with M/s Canara Robeco
Mutual Fund for cross selling of mutual fund products businessand
earned net brokerageofRs.3.4crore.
The Banks tie-up arrangement with M/s United India nsurance Company
Ltd (UIICL) for general insurance business has resulted in a commission
income of around Rs.11 crore duringtheyear. The Bank has Corporate
Agency Agreement with M/s Export Credit Guarantee Corporation of
Indiaformarketingexport policiesthrough its branchesacross India.
Corporate Cash Management Services (CCMS) network of the Bank, covering
94 Operating Centres and 595 Pooling Branches, provides services
related to local and upcountry cheque collection, bulk cheques
collection and zero balance account facility. The aggregate turnover
under CCMS a mounted to Rs.979 crore duringtheyear.
Under Card Business, the Bank took several initiatives to expand credit
and debit-cum-ATM card base. The total debit card base of the Bank
increased to 59.69 lakhs as at March 2011. Profit under card business
during the year wasatRs.21.4crore.
The Bank offers its depository services from 54 DP Service Centres
spread across 36 centres in the country. The Bank is extending Online
Trading Facility to DP clients through its own broking subsidiary M/s.
Canara Bank Securities Limited,Mumbai.
Executor, Trustee and Taxation Services outfit of the Bank provides
services like Debenture/Security Trusteeship, Will and Executorship,
Trusteeship, Personal Tax Assistance and Power of Attorney Services. It
secured 7 new debenture/security trusteeship issues, amounting to
Rs.3286 crore and generated fee-based income of XI.3 crore
duringtheyear.
Under Government Business, comprising Direct and ndirect Tax
collections, payment of pensions to various departments, handling
Ministry Accounts, Posta Transactions and Treasury, collection of
Senior Citizens Deposit, Public Provident Fund Scheme and issue of
relief/ savings bonds of RBI and Government of India, the Bank earned
income to the extent of Rs.55 crore duringtheyear.
The Bank has been authorized as the accredited banker for Ministry of
Human Resources Development (MHRD), handling Department of School
Education and Literacy, Department of Higher education, Department of
Arts - Archeological Survey of India, Ministry of Culture and Ministry
of Youth Affairs and Sports. The Bank has developed a Web-Porta I for
Ministry of HRD fore-tracking of funds under the Sarva Shiksha Abhiyan
(SSA) Scheme. The Bank has implemented the web porta I in a II the
States except Jammu and Kashmir, Uttar Pradesh and Chattisgarh, wherein
the facilities will be implemented shortly.The Bank has implemented the
e-payment of sales tax/ commercial tax in the states of Maharashtra,
Tami Nadu and Karnataka.
The Bank is authorized as the accredited Bankers for Unique
Identification Authority of India (UIDAI), New Delhi. The UIDAI was
established in February 2010, as an agency of Government of India
responsible for implementingthe Multipurpose National Identity Card or
Unique Identification Card (UID Card) project in India.The project is
implemented in 8 centres at present and the Banks branches at these
centres have been designated as the deal branches for hand ling the
UIDAI accounts.
The Bank introduced e-stamping project in 5 branches in Bangalore and
at other 26 branches situated in the District Head Quarters in the
State of Karnataka, the project is under implementation.
Agricultural Consultancy Services (ACS) outfit of the Bank handled 138
assignments during the year under review with the total outlay of the
assignments at over Rs.1363 crore. Apart from the regular assignments,
the outfit handled special projects. These projects include cultivation
and export of culinary herbs, cultivation of medicinal plants and
manufacturing herbal products, rice mill project, organic farming of
fruits and vegetables, tissue culture of banana, dairy farming and
development through embryo transfer technology, silvi culture -
sandalwood cultivation, food processing, cheese manufacturingand prawn
processing and exports.
Special studies and trainings were also conducted during theyear,which
includes, studyon identification of clusters in agriculture and allied
activities for finance, report on scope of Tamil Nadu mega food park at
Dharmapuri and Agriculture Extension Officers training on project
appraisal of hi-tech agriculture.
All Time High Cash Recovery at Rs 2032 crore
Asset Quality
In tune with the industry and economic conditions, the gross NPA level
of the Bank rose to Rs.3089 crore duringthe year. Notwithstanding the
above, the Bank could contain its gross NPA ratio at 1.45% compared to
1.52% in the previousyear. The Banks gross NPA ratio continues to be
one of the lowest among the peers. With a net NPA level of Rs.2347
crore, net NPA ratio stood at 1.11% as at March 2011. The Provision
Coverage Ratio stood at 72.99% as at March 2011 which is well above the
RBI stipulated 70%.
Cash recovery during the year aggregated to an all time high ofRs.2032
crore, well exceeding the preceding years cash recoveryofRs.1575
crore.
The performance under settlements and recovery was quite noteworthy.
During the year, recovery amounting to Rs.830 crore was made under
5ARFAE5I Act. The Bank conducted 9969 recovery meets during the year
which resulted in a recovery of Rs.3 51 crore. Besides,the Banktook
several initiatives to contain slippages and speed up recovery from
overdue loan accounts. These include identification of stressed
accounts for restructuring/ rephasing in time, frequent conduct of
Canadalats at branch level and mega adalats at Circle level for onetime
settlements, regular follow-up of overdues in loan
accountsthroughcallcentreande-auctions.
Risk Management
Basel II norms: Status and Future Strategies
Risk Management Initiatives
The Bank has put in place a unified risk management architecture to
attain global best practices for effective implementation of risk
management initiatives in consistence with the Basel II framework and
RB guidelines. The Board of Directors drives the Risk Management
initiatives in the Bank. The Risk Management Committee of the Board is
constituted and operational. Top Executive Committees for Credit Risk,
Operational Risk and Market Risk Management oversee and monitor the
respective risk management processes and procedures. Asset Liability
Committee (ALCO) meets periodica I lyfor effective and
pro-activeALMintheBank.
Risk Management Wing at the Head Office is functioning asa nodal centre
for overall implementation ofvarious risk management initiatives across
the Bank. Integrated Mid Office of both domestic and forex treasury a
re functioning under the Risk Management Wing for effective and
independent supervision and monitoring of Market Risk in investment and
forex functions. Risk Management Sections a re in place in a II the 34
Zona I/Circle Offices of the Bankasan extended arm ofthe Risk
Management Wingat the Corporate Office.
The Bank has in place various risk management policies, which include
policy for management of Credit Risk, Market Risk, Operational Risk,
Asset Liability, Liquidity Risk, Country Risk, Counterparty Bank Risk,
Corporate Governance, Disclosures, Collateral Management, Stress
Testing, Compliance Functions, Disaster Recovery and Business
Continuity Planning, Business Lines, Outsourcing, Group Risk, Legal
Risk etc. The Bank also framed risk management policies for its
overseas branches, taking into account the requirements of the
respective regulators.These policies are reviewed and fine tuned
annually.
Migration to BaseI 11 Norms
The Banktransitedto Basel II Normsason 31.03.2008.The Capital to Risk
Weighted Assets Ratio (CRAR) is computed as per Pillar 1 requirement of
Basel II Norms, adhering to the New Capital Adequacy Framework (NCAF)
guidelines stipulated bytheRBI.
The Bank hasframed its Policy on ICAAP (Internal Capital Adequacy
Assessment Process) in consistent with the RBI guidelines under Pillar
2 of Basel II Norms. A Capital Planning Committee is in place at the
Corporate Office which meets periodicallytoassesscapital requirement of
the Bank, ensure maintenance of appropriate level of CRAR and evaluate
various options for raising Capita I.
The Bank adheres to the Disclosure norms as per the RBI guidelines
under Pillar 3 of Basel II Norms. A Board approved Disclosure Policy is
in place. A Disclosure Committee, comprising of Top Executives has been
constituted to ensure adherencetothe policy guidelines. The Bank also
initiated steps in preparation to migrate to the advanced credit risk
and operational risk approaches undertheBasel llframework.
Credit Risk Management
The Bank has adopted Standardized Approach1 to estimate Credit Risk
Weighted Assets (RWA) for computing CRAR from the year 2007-08 onwards
as required underthe NCAF.
The Bank has various risk management systems for managing credit risk.
The various initiatives taken by the Bankareasunder:
A comprehensive Credit Risk Management Policy in tunewiththe
regulatoryguidelinesand best practices in the industry
The Bank has in place specific rating definitions, processes and
criteria for assigning exposures to grades within a rating system,
which results in a meaningful differentiation of risk.
Four credit risk rating models are in place, developed internally, for
rating borrowal accounts based on the exposure limits. Rating of
eligible account has been made mandatory as a pre-sanction exercise.
Migration analysis of rated accounts is done periodically.
The Bank is using/ mapping the ratings assigned by recognized external
credit rating agencies to the exposures of the concerned borrowers to
optimize capital undera standardized approach.
Pricing based on credit risk rating has been introduced.
Entry barriers a re fixed based on risk rating.
Credit sanctioning powers are delegated to various authorities based on
internal risk rating of the borrowers.
To avert concentration of risk, fixation of various exposure ceiling/
prudential norms, such as, single and group borrowers, substantial
exposures, term loans, unsecured advances, exposures to various
industries, NBFCs, real estate sector and capita market a re in vogue.
For strengthening loan review and monitoring mechanism, Credit
Monitoring and Credit Administration Wings wereformed.
An exclusive credit monitoring policy has been put in place. The loan
review mechanism articulated in the credit monitoring policy covers the
entire gamut of review and monitoring to be an effective tool for
evaluatingthe loan book continuously and intendsto bring out
qualitative improvements in credit administration including credit
audit.
Credit Audit system by external / internal auditors of all borrowal
accounts of Rs. 1 croreand above has been put in place.
Operational Risk Management
The Bank computed capital charge for operational risk by adoptingBasic
Indicator Approach1 asstipulatedbythe RBI.
A proper organizational structure is in place to oversee and guide the
operational risk initiatives of the Bank. To move towards advanced
approaches for operational risk, thefollowing initiatives have
beentaken-
Formulation of Operational Risk Management Policy which covers the
objectives, identification, assessment, monitoring and control of
operational risk loss incidents.
Training imparted to staff to create awareness on operational risk
management system.
The Bank has compiled a comprehensive Best Practices Codes (Manual of
Instructions) and Desk Cards on all the activities carried out at
branches for theirguidance.
Market Risk Management
The Bank has been computing capital charge for market risk on Available
For Sale (AF5) and Held For Trading portfolio under investments, by
adopting Standardized Measurement Method.
Integrated Mid Office at RiskManagement Wing monitors market risk
exposure. Exposure limits, such as, Stop Loss limits on trading books,
Dealer-wise limits, limits on Money Market Operations, M-duration
limits for AFS category, VaR limits, Aggregate Gap limit, Intra day and
overnight limit for various currency positions are fixed to act as risk
mitigants and are monitored. Reporting system has been strengthened for
effective market risk management.
Towards implementation of Internal Models Based Approach for
calculation of capital charge for market risk, the Bank has put in
place a VaR based model for estimating General Market Risk. The process
of back testing of the results given by the model has been completed.
Stress testing exercise as per the guidelines isenvisaged.
Asset Liability Management
An effective Asset Liability Management (ALM) system, addressing issues
related to liquidity and interest rate risks is in place. The Board of
Directors of the Bank has constituted an Asset Liability Committee
(ALCO) to oversee ALM functions, includingfixation of interest rates
for various components of assets and liabilities, its composition,
maturity and duration. A comprehensive software solution has been
installed for quantifying risks and to analyze Maturity Gap, Duration
and Sensitivity of Assetsand Liabilitiesto interest rate variations.
The liquidity position of the Bank is tracked on a daily basis by means
of residual maturity of assets and liabilities. Periodical studies are
undertaken to analyze the behaviora patterns of various components of
assets and liabilities to estimate the liquidity on a dynamic basis.
The Banks iquidity policy sets the tolerance limit for its structure
iquidity positions. The liquidity positions of overseas branches are
managed in line with home and host country regulatory guidelines. Such
positions are reviewed by the Banks ALCO along with domestic
positions.
Toevaluatethe impact of changes in interest rate on Banks earnings, an
analysis of Earnings at Risk (EAR) and its impact on Net Interest
Income (Nil) are done on an ongoing basis. The change in the
composition and residual maturity of assets and liabilities is
evaluated by the Traditional Gap Method as also by the Duration Gap
Method. Stress testing exercises by simulating scenarios of liquidity
and interest rates are undertaken to estimate the stress cost as also
the Economic Value of Equity (EVE).
The ALCO meets regularly to discuss various issues pertaining to the
liquidity position by considering the residual maturity profile of
various assets and liabilities, ta kes stock of the dynamic interest
rate scenario, discusses at length the changes evolving in economic and
financia parameters, which have a director indirect bearing on the
banking industry and focuses on the impact of all these factors on the
business profile of the Bank.
Risk Management Committee of the Board:
The Board level Risk Management Committee is already in place in the
Bank, which meets regularly to provide guidance and direction in
implementing the risk management initiatives of the Bank.
In conformity with the RBI guidelines, the Bank has implemented the New
Base Rate system of interest application on loans and advances with
effect from lstJuly2010.
NATIONAL PRIORITIES
Priority Sector Advances
As one of the leaders in the domestic banking arena, the Bank continues
to accord importance to varied goals under national priorities,
including agriculture, smal enterprises, education, micro-credit,
weaker sections, SC/STsand minorities.
During the last 3 years, the Bank has achieved stipulated mandatory
targets under Total Priority, Total Agriculture, Agriculture (Direct)
and Weaker Sections.
Priority Sector Advances of the Bank as at March 2011 increased
byRs.11447 croreto reach Rs.70757 crore, recording ay-o-y growth of
19.3%, covering over 40 lakhs borrowers. Priority sector advances
formed 44.08% of the Banks Adjusted Net Bank Credit (ANBC), well above
the 40% stipulated norm.
[Amt. in Rs. Crore]
Priority Sector Advances As at Growth
March
2010 2011 Amount %
Total Priority Sector 59310 70757 11447 19.3
Agriculture 25052 29656 4604 18.4
Micro & Small 24180 29558 5378 22.2
Enterprises
With a focus on credit delivery to agriculture, the Banks advances
under agriculture rose by Rs.4604 crore to reach Rs.29656 crore,
covering over 31 lakh farmers. Agriculture credit as a proportion of
ANBC crossed the mandatory targeted level of 18% to reach 18.48%.
Advances to agriculture (direct) reached a level ofRs.22669 crore, with
an 18.9% growth and accounting for 14.12% of ANBC as againstthe
mandatory 13.5% norm.
Under Kisan Credit Card Scheme, the Bank issued 3.68 lakh cards
duringtheyear, with credit coverage of Rs.3082 crore. As at March
2011, the cumulative number of Kisan Credit Cards reached over 33
lakhs, involving credit coverage of Rs.17589 crore.
Over the years, the Bank has supported lakhs of promising students to
pursue higher education in India and abroad.
The Bank has further increased its education loan portfolio and
sustained its premier position among nationalized banks in ndia for
FY11. The Banks advances under Education Loan Scheme recorded a growth
of 21%to reach Rs.3503 crore.
The Bank hasfinanced morethan 1.92 lakhs students as at March 2011. The
Bank is designated as the nodal bankfor administering subsidy under the
Central Sector Scheme for Interest Subsidy on educational loans. The
Bank also extended financia assistance to other priority sectors, such
as, retail traders, housingand microcredit.
During the year, the Bank actively participated in various Government
Sponsored Schemes, such as, PMRY, SGSY, SJSRY, SLRS and DRI. As at
March 2011, the outstanding advances under these schemes aggregated to
Rs.610 crore, involvingover 1.46 lakhs beneficiaries.
Performance under various Government sponsored schemes
Name of the Scheme No. of Accounts Amt. in Rs. Crore
PMRY 49167 252.63
SGSY 48189 234.39
SJSRY 16005 69.40
SLRS 691 1.38
DRI 32057 51.91
Total 146109 609.71
- In support of the underprivileged sections of the society, the Banks
advances to 5C/5T beneficiaries reached Rs.5087 crore as at March 2011,
with a y-o-y growth of 30%. The ad va nces to 5C/5T com prised 7.19% of
total priority sector advances.
- Advances to weaker sections aggregated to Rs.17823 crore, with a
y-o-y growth of 21.8%. Advances to weaker sections formed 11.10% of
ANBC against the norm of 10%.
- As at March 2011, advances to specified minority communities
aggregated to Rs.11718 crore and accounted for 16.56% of the total
priority sector advancesasagainstthenormof 15%.
Advances to Micro, Small and Medium Enterprises (MSMEs) reached
Rs.37684 crore, with a y-o-y growth of 21.3% vis-a-vis
mandatoryy-o-ygrowth of 20%.
The Bank has covered 49,260 accounts with an exposure of Rs.1471 crore
as at March 2011 under the Credit Guarantee Scheme of Credit Guarantee
Fund Trust for Micro and Small Enterprises (CGTMSE).
Considering the importance of cluster based approach of lending to MSME
sector, the Bank has focused on adoption of select industrial clusters
across the country and expanded lending underclusterbased approach.
During the year, the Bank has increased the number of independent
centralized loan processing centres for MSMEs, viz., "SME SULABH"to 25
centers. It is proposed to increase the number of such centres to 34
during 2011-12. The Bank has embarked upon reaching out to large
section of MSMEs at major centres in the country through thismodel.
The Bank received an amount of Rs.16.9 crore from the Ministry of
Micro, Small and Medium Enterprises, Government of India, during the
year as a Nodal Agency for Technology Upgradation of SSI units under
Credit Linked Capital Subsidy Scheme (CLCSS) and amount utilized
duringtheyearstoodatRs.13.3 crore.
Financial Inclusion
Canara Nayee Disha- A Complete Solution for Financial Inclusion
Not just mobilizing no-frill accounts from the financially excluded,
the Bank is providing total solution for the Financial Inclusion
byextendingcreditfacilityunderGeneral Credit Cards, Credit linking
Self-Help Groups (SHGs), making provision of small insurance
facilities, enhancing outreach through Business Correspondents and
using of technology- Smart Cardsand Bio-Metric ATMs.
The Bank achieved total Financial Inclusion in all the 26 Lead
Districts spread over five States, namely, Karnataka, Kerala, Tamil
Nadu, Bihar and Uttar Pradesh. During 2010-11, the Bank mobilized 6.05
lakhs no-frill accounts (CanSaral) and reached a cumulative level of
27.84 lakhs since inception. The Bank has opened 913 new accounts per
Rural and Semi urban branches as againsttheGovernment of India target
of 250 per annum. The total savings in the no-frill accounts reached a
level of Rs. 520 crore.
Duringtheyear,the Bankhasformed 31121 SHGs,taking the cumulative number
of SHGs formed to 3.51 lakhs as at March 2011. With 45977 SHGs credit
linked during the year, the cumulative tally under credit linking
reached 3.21 lakhssince inception.Thetotal exposureofthe Bank under SHG
finance rose to Rs.1064 crore, spreading over 90172 SHGs accounts.
The Bank undertook several technology initiatives to further financial
inclusion process like multi-lingual bio- metric ATMs, voice-enabled
mobile bio-metric ATM and Smart Cards. The Bank has installed Bio
Metric Voice Enabled ATMs/ Biometric Mobile ATMs in 23 Rural/Semi urban
locations and has issued around 84000 Smart Cards as at March 2011. The
Bank also issued 3.02 lakhs General Credit Cards (GCC) since inception
and thetotal exposure under GCCs as at March 2011 increased to Rs. 359
crore, spread over 1.75 GCC accounts. The Bank on its founders day on
19th November 2010, distributed 1 lakh GCCs, 50,000 Smart Cards and
opened 9 Financial Literacy and Credit Counseling Centres (FLCCs)
across India.
The Banks FLCCs called Amulya are in operational in 10 districts,
viz., Kolar, Chitradurga and Chikkaballapur in Karnataka, Madurai,
Erode and Dindigul in Tamil Nadu, Malappuram, Waynad and Trissur in
Kerala and Sheithpura in Bihar. The Bank has registered a new Trust,
viz., Canara Financial Advisory Trust to manage the Financial
Literacyand CreditCounselingCentres.
To create awareness about banking facilities and the Banks products
among the rural households, the Bank has deployed Gramin Vikas Vahini1
(vehicles) in 35 districts across the country.To disseminate
information to the rura people about the banking products and advanced
tech nology the Ban kformed 127 Fa rimersclubsduringthe yea
r,takingthetota I to 1360 across the country.
For catering to the needs of the urban poor and urban financial
inclusion, the Bank opened 19 Exclusive Microfinance branches in urban
centres viz., Madurai, Hyderabad, Mumbai, Amritsar, Chandigarh,
Lucknow, Coimbatore, Bangalore, Chennai, Bhopal, Bhubaneshwar, Delhi,
Jaipur, Kolkata, Patna, Pune, Shimoga, Trivandrum andVisakapatnam.
The Bank is allotted 1573 villages with population more than 2000,
across the country for provision of banking facilities. The Bank has a
I ready covered 626 villages as at March 2011 and will cover all the
1573 allotted villages with population of morethan 2000,through
ICTmodel or through Brickand Mortar branch by 31.03.2012.
The Bank is the registrar for Unique Identification Authority of India
and it has taken up enrollment for issue of UID numbers by engaging an
enrollment agency, namely, M/s. Smart Chip Ltd. The Bank has started
the enrollment and set up a work station at Parliament Street branch,
New Delhi, on 29.03.2011.
Lead Bank Scheme
Canara Bank has lead bank responsibilities in 26 districts in the
country, viz., eight in Karnataka, seven in Tami Nadu,five in
Kerala,five in Uttar Pradesh and one in Bihar. The Bank works as the
Convenor of the State Level BankersCom mittee(SLBC) in the State of
Kerala.
Entrepreneurship Development among Women
Centre for Entrepreneurship Development for Women (CEDW) at Head
Office, Bangalore and Centres at 34 Zonal/Circle Offices are working
towards economic empowerment of women.These Centres have conducted
several training programmes during the year, including general
Entrepreneurship Development Programmes (EDP), Entrepreneurship
Awareness programmes, Seminars, Career Guidance programmes, Skills and
provided marketing support to women entrepreneurs by organizing
Canutsav /Canbazar. CEDW cells have also assisted in formation of SHGs
and credit linkages. Two exclusive Mahila Banking Branches at Bangalore
and Chen nai a re also operating specifically to cater to women
clientele. 19 micro finance branches also cater to the financial
needsofwomen SHGs.
- As at March 2011, the Bank has extended credit to women to the tune
of Rs.27022 crore, accounting for 16.84% of ANBC against the RBI norm
of 5%. The Bank has covered nearly 12.78 lakhs women beneficiaries.
- During the year, fresh disbursement of Rs.9298 crore was madeto women
beneficiaries.
- The Bank has financed Rs.18549 crore to women beneficiaries under
priority sector.
- The Bank has provided certain special benefits to women entrepreneurs
in MS ME sector for loans upto Rs.5 lakh to encourage more and more
women to undertake entrepreneurial activities.
CORPORATE SOCIAL RESPONSIBILITY
Following the century old tradition and founding principles, the Bank
is engaged in varied Corporate Social Responsibility (CSR) activities.
CSR initiatives of the Bank are multifarious, covering activities like
training unemployed rural youth, providing primary health care,
drinking water, community development, em powerment of women and other
initiatives.
Rural Development
The Bank, through its Canara Bank Centenary Rural Development Trust
(CBCRDT), has established exclusive training institutes to promote
entrepreneurship development among rural youth and encourage them
taking up self-employment activities. During the year, 3 new training
institutes were opened at Kanshiram Nagar and Hathras in Uttar Pradesh
and Tiruppur in Tamil Nadu taking the number of such training
institutes to 29. For the yea r 2010-11, CBCRD training institutes have
trained 26753 candidates, taking the tally to 125049 unemployed youth
since inception. The candidates trained comprised 68% women and 31%
SC/ST, with an impressive settlement rate of 67%.
The Bank has co-sponsored 24 Rural Development and Self Employment
Training Institutes (RUDSETIs) engaged in training of rural youth for
taking up self-employment programmes. During 2010-11, the RUDSET
institutes have trained 21459 candidates. The 24 RUDSETIs have, so far
trained 2,59,036 unemployed youth, with a settlement rate of 71%.
Canara Banks Rural Clinic Service Scheme provides basic health care
services in remote areas lacking basic medical infrastructure
facilities. Under the Scheme, the Bank encourages doctors to set up
clinics in identified rural areas. As at March 2011, the total number
of such clinics rose to 544. The Bank under Jalayoga, a scheme to
provide safe drinking water, implemented 35 projects in its lead
districts.
AN EXAMPLE FOR NURTURING AND
FINE-TUNING THE SKILLS OF RURAL
ARTISANS IN INDIA.
A lot of talented Rural Artisans have found their ways to fine-tune and
master their skills with the aid of training imparted by the Banks
sponsored/co- sponsored Rural Training Institutes. One such success
story is that of Shri. Sadashiv Shenoy an artist par excellence who has
seen to it that the long tradition of his family, who are renowned
artists, is well nurtured. Though a born artist, he did not have a
single specific area but concentrated on wide ambit of art in
multifarious fields. He spent almost two years at the CE Kamath
Institute for Artisans at Karkala as a trainee to further excel his
skills a nd attain mastery overarts.
Completing an eventful training of two years at the C E Kamath
Institute for Artisans at Karkala , he went back to his own family work
shed and started executingthe masterpieces. Wood Carving, Sculpture
were his area of strength and he employed 4 Master Craftsmen and 25
Artisans at his work shed. The products created by him and his team has
wide appreciation and demand in India and abroad. His pieces are
decorated in many temples across the Country and the Ganapathy statue
is very popular in Mangaloreand USA.
Being an artist with excellent creativity and fineness, there is no
dearth of money and recognition. This should be enough motivation to
sustain the famed art of the nation, he says. Just focus on the job,
everything willfollowyou is his conviction and message.
Son of late Shri. Su rend ra Shenoy, an artist of eminence and
recipient of numerous awards, Shri Sadashiv Shenoy hailingfrom Bantwal
Taluk has dedicated his life towards art and improving the skill.
The Bank donated a hi-tech, custom built, solar powered Mobile Sales
Van1 to assist women entrepreneurs, SHGs and artisansto
markettheirproducts.
The Banks Social Action Cell organized Blood Donation camps, Health
camps, assisting people affected by natural calamities, assisting
challenged section of the society, including encouraging students by
conducting various programmes and activities.
Visits by Parliamentary Committees
During 2010-11, Parliamentary Committees on Industry, Parliamentary
Committee on Personnel, Public Grievances, Law & Justice, Parliamentary
Committee on Government Assurance, Parliamentary Committee on
Subordinate Legislation and Committee of Parliament on Official
LanguagevisitedtheBank.
ORGANISATION AND SUPPORT SERVICES
Expanding Pan India Presence
During the year, the Bank undertook a major branch expansion drive
across the country. The Bank, on its Founders Day on 19th November
2010, opened 100 new branches and 100 new ATMs across the country,
inaugurated by the Honble Union Finance Minister Shri Pranab
Mukherjee. The Bank added 210 domestic branches in FYll,takingthetotal
tally underthe branch networkto 3257 branches, including4overseas
branches one each at London, Leicester, Hong Kong and Shanghai.
Composition of domestic branch network
No. of Branches
Category 31.03.2010 31.03.2011
Metropolitan 727 758
Urban 744 762
Semi-urban 793 922
Rural 779 811
Total Branches 3043 3253
The Bank has 139 specialized branches catering to the specific
clientele segment.
Categories of Specialized Branches 31.03.2011
1. SMEs 49
2. Overseas 16
3. Agri-Finance 10
4. Micro Finance Branches 19
5. Savings 6
6. NRIs 7
7. Asset Recovery Management 7
8. Prime Corporate 10
9. Industrial Finance 4
10. Stock Exchange 3
11. Capital Market 3
12. Mahila Banking 2
13. Consumer Finance 1
14. Housing Finance 1
15. Branch for Physically Challenged 1
TOTAL 139
Info Tech Progress
The Bank took several initiatives in the InfoTech front during the
year. The Bank covered all its branches/offices under Core Banking
Solution (CBS). With 100% CBS, the Bank now offers technology banking
services, such as, nternet Banking, Funds Transfer through NEFTand
RTGS, SMS Alerts, IVRS based enquiryacrossall its branches. The Ba nk
also offers on I inetradingfacility to its clients through its own
subsid ia ry M/s Ca na ra Ba n k Secu rities Ltd.
As at March 2011, the Bank had 2216 ATMs spread across 846 centres.
These ATMs have also been enabled to offer value added services like
Travel ticket booking, Mobile top up and Utility Bill payments.
In view of the increased attacks of phishing and pharming, the Bank has
put in place a 24X7 centralized monitoring system of anti phishing and
anti malware. To make the nternet Bankingfacility more secure a slew of
measures like implementation of OTP (One Time Password) module, two ive
validation of account numberforNEFT/RTGS transaction through Net
Bankingand mutual authentication of Internet Server customer PC (CAN
SECURE) were introduced. With increased confidence, the number of
customers enrolled for nternet Banking has moved upto 3.86 lakhs.
The Bank upgraded its Data Centre infrastructure to comply with ISO
27001 standards and did the upward migration of database to Oracle 11G
version. The Bank has a well designed and secured corporate network
covering all the branches and offices. Local Processing Centres (LPCs)
have been extended to 31 Centres.The Bank has also established one
Central Pension Processing Cell and 3 NRI Hubsduringtheyear.
A customer terminal has been provided in the branches for easy and
ready reference to own accounts of customers. Bank has also implemented
Electronic Data nterchange Module for payment of customs duty and
fulfillingthe related formalities in electronic mode.
To connect with the youth of the country and obtain first hand
unrestricted feedback, the Bank has a presence at Twitter
(http://twitter.com/canarabanktweet).
Manpower Profile
As at March 31, 2011, the Bank had 43397 employees on its rolls.
March March
2010 2011
Total No. of Employees 43380 43397
Officers 17338 17649
Clerks 16285 16178
Sub-Staff 9757 9570
* includes part-time employees (PTEs)
The Banks employees comprised 40.7% officers, 37.3% Clerks and 22.0%
Sub-Staff. Women employees comprising 10281 constituted over 23.5% of
the Banks total staff. The Bank recruited 1089 women employees and
promoted 303 women employees under various cadres duringtheyear.
During the year, the Bank recruited 2335 persons in various cadres, out
of which 412 belonged to Scheduled Castes (SCs) and 179 to Scheduled
Tribes (STs) categories. The total number of ex-servicemen staff as at
the end of March 2011 stood at 1652, out of which 169 were recruited in
various cadres during the year. There were 870 Physically Challenged
Employees on the rolls of the Bank.
Reservation Policy in respect of SCs and STs
As at March 2011, the number of Scheduled Castes and Scheduled Tribes
together constituted 26% of total staff strength ofthe
Bank.Thecomposition of SC/STemployees in the Bank as at March 2011 was
as under:
Scheduled Scheduled
Cadre Castes Tribes
Officers 3245 1172
Clerks 2814 894
Sub-staff + PTEs 2721 448
Total 8780 2514
The Bank has been strictly adhering to the Reservation Policy in
respect of Scheduled Castes and Scheduled Tribes as perthe Govt, of
India guidelines.
- Reservation Policy is implemented through the mechanism of Post Based
Rosters. In terms of the directives ofthe Ministry of Finance,
Government of India, Bank has since switched over to Post Based Rosters
for all cadres.
- The Bank has been extending Reservation/ Relaxations/Concessions in
Direct Recruitment as well as in promotionsto candidates belongingto
Scheduled Castes and Scheduled Tribes as per the Govt, guidelines.
- Pre-recruitment and Pre-promotion training is given to candidates
belonging to Scheduled Castes and Scheduled Tribes. In the
Advertisement inviting for the application from the eligible candidates
for recruitment to Clerical and Office read res, a specific reference
is made with regard to imparting of pre-recruitment training to
candidates belonging to SC/ST / PWD / Minority Communities / Ex-service
men. Candidates who opt for pre-recruitment training are given training
to prepare themselvesforwrittentestas well as interview.
- Study materials, note book, stationery are provided free of cost to
all the participants. Wherever possible, respective State Governments
are also providing the lodgingfacilities in government/backward class
hostels.
- The Ba n k has setu p SC/ST Cel I at the Head Office a nd a Iso at
Circle Offices to ensure maintenance of Rosters and implementation of
otheraspects of Reservation Policy
- Chief Liaison Officer has been nominated at Head Office and Liaison
Officers have been nominated at Circle Offices for ensuring
implementation of Reservation Policy.
- Further, representations received from Scheduled Caste / Scheduled
Tribe employees, either directly or through the SC/ST Associations, are
being looked into by the Liaison Officer/Chief Liaison Officer.
Wherever required, necessary enquiries are conducted and appropriate
action is taken. A separate register is maintained for recording
various representations received from Scheduled Caste/Scheduled Tribe
employees and the action taken is also recorded in the register.
- In addition to the a bove, the representatives of majority Scheduled
Caste / Scheduled Tribe Employees Association are invited for
Quarterly Meeting with the Chief Executive of the Bank to discuss on
the implementation of guidelines on reservation policy. Quarterly
Meetings are also held at Circle Offices, where Rosters a re maintained
and grievances, if any, are redressed by the Liaison Officer.
- The Board of Directors of the Bank also reviewed the progress made in
the implementation of Reservation Policyona halfyearlyandyearlybasis.
Training /Human Resource Development (HRD)
The HR policies of the Bank have been reinvented and refocused time and
again to suit to the changing banking scenario. HR interventions like
SPANDAN for bringing attitudinal change among front line staff,
PRATIBHA for grooming in-house talents in varied specialized areas and
executive groomingthrough reputed institutes and other significant HR
tools like Quality Circles, Study Circles, Staff Meetings and Brain
Storming Sessions have been implemented for effective team building and
fostering collective excellence.
The Banks quest to enhance the competencies of the workforce will
continuethrough focused and need based trainingsat various institutes
of repute like IIMs, ISB,XLRI and NIBM. Customised programmes are also
being organised to develop expertise in certain niche areas like Risk
Management, Treasury Operations and IT.
Specialised trainings to the Senior Management Level / Top Management
Level executives are conducted based on the requirement. The Bank has
been able to add substantially to the repertoire of knowledge of its
officials through this training intervention and motivating them to
perform with renewed vigour and enthusiasm.
The Bank has trained 26875 employees during the year, covering a wide
range of functional areas Out of the trained staff, 6937 personnel
belonged to the Scheduled Caste category and 2022 under the Scheduled
Tribe category.
Establishing a proper Talent Management and Reward System will be the
Banks focus in the com ingyears. There will be concerted efforts to
identify potential leaders and groom them to take up higher
responsibilities.
Changes intheOrganizational Setup
The Bank brought out further changes in its organizational/ operational
set-up to facilitate smooth functioning and driving results.
After completely moving into a 3 tier structure comprising of Head
Office, Circle Offices and Branches, during FY11, the Bank has carved
out 3 functional Wings, viz., MSME Wing, Credit Administration Wing and
Transaction Banking Wing to expand lending to MSMEs, to have focused
credit administration and expand alternative delivery channels
respectively.
Customer Orientation
The Bank hastaken initiatives to remain customerfocused through
providing fast service, bringing in diversified products/services,
responding to customers queries and redressal of customers
complaints. The Bank made arrangements for providing copies of the
Code of Banks Commitment to Customersto customers at branches. An
informative booklet containing all the relevant information on
Frequently Asked Questions by Customers was made available at all
branches towards better Customer Service. The Policy guidelines
relating to Collection of Cheques/Instruments, Grievance Redressa
Mechanism and Compensation Policy were placed on the Banks website for
use of the customers. In order to assess the quality of customer
service rendered by our branches and to get feedback a Contact
Questionnaire is made available in the Banks website. A survey to
measure customer satisfaction was conducted by M/s Campaign ndia
Research and Marketing Services Pvt. Ltd. As a part of Customer
Relationship Management initiatives, a Call Centre is functioning. The
call centre caters to the customers in 6 languages viz., English,
Hindi, Kannada, Tamil,Telugu and Malayalam. The number of calls
received by the Call Centre during the year was more than 6.50 lakhs.
The Bank redressed all the customer complaints within the stipulated
period, with 95% customer complaint redressed.
Systems and Procedures
Risk Based Internal Audit (RBIA) was conducted in 2057 branches/ units
programmed for on-site RBIA during the year. Information Security Audit
was conducted along with RBIA. Concurrent / Continuous Audit was
conducted in 752 identified branches/ units covering 60% of deposits
and 78% of advances of the Bank as per RBI guidelines. ncome/revenue
audit was conducted on quarterly basis in 481 identified branches as
per Jilani Committee Recommendations. Apart from the above, 341
branches were subjected to Special Income Audit. On-site RBIA of
Circles/Wings was introduced with effect from 01.04.2010 as perthe
directions of the RBI.
Know Your Customers (KYC)
The Bank took several measures for the effective implementation of Know
Your Customer (KYC) and Anti Money La undering(AML) guidelines and for
ensuring KYC compliancebyall branches.
To ensure better compliance of guidelines on KYC / AML followingsteps
have been initiated.
- All Zones/Circles have nominated an Executive as Nodal Compliance
Officer for monitoring and ensuring compliance of guidelines on Know
Your Customer (KYC)/Anti Money Laundering (AML)/Com bating of Financing
of Terrorism (CFT).
- Branches were advised to strictly adhere to the guidelines on
KYC/AML/CFT to prevent abuse of banking system by money launderers
using money mules.
- NREGA job card/Aad ha r document has to be accepted as identification
document for opening of accounts. Accounts opened exclusively with
these documents will have restrictions applicable tosmall accounts.
- Printing and dispatch of Thanks giving letters to new account holders
and introducers are done centrally at Zonal/CircleOffice.Thissystem has
been implemented at all Zones/Circles.
Vigilance Setup
The Vigilance Wing of the Bank is headed by the Chief Vigilance Officer
(CVO) in the rank of General Manager, assisted by 34 Vigilance Officers
from all Zonal/Circles, RRBs and the Subsidiaries. The functions of the
vigilance machinery of the Bank is broadly divided into 3 types viz.,
Preventive, Predictive and Punitive. Vigilance Wing of the Bank
constantly reviews existing systems and procedures in various areas and
wherever required recommends changes to strengthen prevention of frauds
and eradication of corruption. To educate the employees of the Bank,
the Wing brings out various Fraud awareness Circulars and other
periodical publications. During the year, the Wing has brought out a
Compendium on Vigilance and Disciplinary matters - a comprehensive
reference book on all Vigilance aspects.
The Wing has organized Training Programmes and Conferences for the
benefit of all CVOs of all Banks. In addition, the Wing has undertaken
the task of imparting training to the Police Department Personnel on
issues relating to frauds in Banks, particularly on Cyber Crime matters
having severe impact on the technologica advancements inthe Industry.
As per the directions of Central Vigilance Commission, Vigilance
Awareness period was observed from 25th October 2010 to 1st November
2010. This year the main focus was on the Generation of Awareness and
Publicity against Corruption. While all the Circles of the Bank
observed the Awareness Period with alacrity, the culmination of the
event was marked by the Guest Lecture rendered by the eminent Lokayukta
of Karnataka State, HonbleJustice N Santosh Hegde.
The Wing hasalso introduced a New Linkonthe intranet, enabling even the
remote branches to have an instant updation of all Vigilance
Communications, especially on fraud prevention in CBS environment.
The vibrancy and dynamism of the Vigilance Wing has enabled the Bank to
take timely steps to improve the turnover time to less than six months,
for closure of vigilance cases, from the date of issue of charge sheet.
All complaints received are disposed off in less than two months. The
Whistle Blowing mechanism has been encouraged, as a result of which,
many fraudsters have been broughtto book.
The Vigilance Management function has gone hand-in- hand with the
business developmentf unction of the Bank.
Security Arrangements
The security environment in the Bank remained, by and arge, normal
during 2010-11. There were 68 incidents of crime during the year
involving a loss of Rs.30 lakh. There was one major fire incident
during the year and loss approximated toRs. 15.30 lakh. The security
arrangements have been reinforced by installation of CCTV in all
Currency Chests and identified branches. Modern fire safety devices
have been introduced at select offices. Fire safety drills have been
introduced and conducted at regular intervals in orderto minimize
damage to property and prevent injuryand lossof life.
Ambience Improvement
All the new branches opened in prime localities and branches shifted to
new premises during the year were provided with suitable interior to
meet the present day requirements of the customers. New branches were
opened in Ground Floor as far as possible. Besides, the Bank is
providing better interiors to augment the requirements of computer
environment and also proposes to enhance the ambience at all branches.
Ambience improvement has been taken as a core agenda forFY12.
Rightto Information
Underthe Rightto Information Act, 2005,the Bank set up an exclusive
Right to Information Act outfit to provide information and bring
transparency. As per the requirement of the RTI Act, Canara Bank
nominated Public Information Officers and Appellate Authorities in all
its 34 Zonal/Circle Offices to provide information to the applicants.
During the Financial Year 2010-11, Bank received 3541 RTI applications,
531 First Appeals and 155 Second Appeals as per the provisions of RTI
Act, 2005.
Implementation of Official Language
The Bank made noteworthy progress under the implementation of official
language and won many prizes at various levels during the year under
review. The Bank was awarded second prize in Region "C" under Reserve
Bank of India Shield Scheme. Town Official Language implementation
Committee (TOLIC), Trivandrum and Coimbatore, where the Bank is the
Convenor, were awarded first prize and third prize respectively by the
Regional Implementation Office, Department of Official Language,
Government of India. Apart from this, many Zones/Circles and branches
have received awards from Official Language Department, Government of
India and the respective Town Official Language Implementation
Committees.
As at March 2011, around 95% of employees have obtained working
knowledge in Hindi and the Bank has notified 2192 Branches under Rule
10(4) of OL Rules 1976. All the employees of the Bank possessing
working knowledge of Hindi have been trained in Hindi workshops. The
Bank has conducted 120 refresher training programmes for such employees
during theyear.
In the sphere of using Information Technology in Official Language, the
Bank has furthered the use of Unicode and also made provision in ATM
screens of the Bank for carrying transactions in 10 Indian languages.
Telebanking facility has also been provided in Hindi and English and in
other 6 major regional languages. The Banks corporate website is fully
bilingual. Steps have been initiated for providing Hindi option in Core
Banking System. In three pilot branches one each in A, B & C
region, Hindi option was successfully installed. The Banks bilingual
address booklet CANPATHA is made available to all branches and offices
in electronicform.
To encourage effective implementation of Official language in Bank, 148
prizes were given to branches and offices under the award scheme
formulated by the Bank viz., Canara Bank Rajbhasha Akhay Yojana and 103
employees were awarded under Rajbhasha Puraskar Yojana.
Atabletop"Karyapalak Noting Sahayika" was brought out to assist
Executives to carry out Notings in Hindi and the same was released by
ourC&MD on the occasion of Hindi Day Function 2010. Annual Hindi
Journal "Canarajyoti" was brought out to encouage original writing in
Hindi.
The Parliamentary Committee on Official Language had inspected a few
branches and the Banks Zonal/Circle Offices at Delhi and Coimbatore.
The Committee lauded the efforts put bythe Bank in thefield of Official
Language implementation.
Promotion of Sports
Canara Bank has always been encouraging and supporting sportsand
contributed generously to sporting activities at over the country,
sponsoring tournaments and providing scholarships to talented
sportspersons. The Bank has also shown a keen and abiding interest in
recruiting sportspersons and today has on its rolls 41 sports persons
in six disciplines viz., Cricket, Hockey, Womens Athletics, Badminton,
Ball Badminton and Table Tennis.
International Cricketers Shri B K Venkatesh Prasad, Shri Sunil Joshi,
Ms Shantha Rangaswamy, Ms Kalpana and Ms Sudha Shah (Coach of the
Indian Womens Cricket Team) are presently in the Banks fold. Ace
Shuttler and former National Champion and former coach of the Indian
Badminton Team, Shri U Vimal Kumar, Internationa Athletes Smt. M K
Asha, Smt. Suma Gopalakrishna and Smt. H M Jyothi and Hockey
Internationals Shri Bharat Ch hetri a ndShriPShanmuga ma re also in the
Banks rolls.
Canara Bank recorded several distinctions in the sporting arena and the
Banks Cricket, Ball Badminton and Table
TennisTeamsrankni/meroi/nointheStateof Karnataka.
FINANCIAL SUPERMARKET
Subsidiaries, Sponsored Entities and Joint Ventures Canara Bank, with
an objective of offering One Stop Banking Mart1 for the customers,
forayed into diversified business activities by opening subsidiaries
during late 1980s. Today, the Bank functions as a Financial
Supermarket with as many as eight subsidiaries/ sponsored
entities/joint ventures in diversified areas. The Bank has taken
significant steps towards strengthening fundamentals of these entities
so as to emerge as a strong Financial Supermarket in India. All the
subsidiaries/ sponsored entities/joint ventures of the Bank recorded
satisfactory performance during the reportingyear.
Commercial Bankof India LLC (CBIL)
CBIL, a joint venture of Canara Bank and State Bank of ndia, has been
operational since April 2004 in Moscow, Russia.TheCompanyearned a
profit aftertax of USD 2.85 million as at 31st March 2011.
Canbank Venture Capital Fund Limited (CVCFL)
CVCFL, the Trustee and Manager of Canbank Venture Capital Fund (CVCF),
is a wholly owned subsidiary of the Bank. For the year, the Company
posted a profit of Rs.4.08 crore as com pa red to Rs.0.71 crore for
2009-10. It lau nched its 5th Fund with the corpus of Rs.500 crore on
15.06.2010. The Company has proposed a 100% dividend for the
year2010-ll.
Can Fin Homes Limited (CFHL)
CFHL, a sponsored entity of Canara Bank, is one of the premier housing
finance entities in the country. As at 31.03.2011, the Banks stake in
CFHL was 42.35%. The Company disbursed loans amounting to Rs.473 crore
during the year, taking cumulative disbursement to Rs.2199 crore. CFHL
posted a net profit of Rs.42.02 crore for FY11. The Company proposed a
25% dividend for the year 2010-11.
Canbank Factors Limited (CFL)
Canbank Factors Limited, which is a factoring subsidiary of the Bank,
is a member of Factors Chain Internat
Mar 31, 2010
The Board of Directors have pleasure in presenting the 41st Annual
ReporttogetherwiththeBalanceSheetason 31st March, 2010 and Profit and
Loss Account for the financial year ended March 31,2010.
CORPORATE SOCIAL RESPONSIBILITY
Setting Examples in Corporate Social Responsibility Activities
Following the century old tradition and founding principles, the Bank
has set fine examples in fulfilling varied Corporate Social
Responsibility (CSR) activities. The Bank has been taking numerous
initiatives over the years to promote rural development and has set up
many self-employment training institutes to counter poverty and
unemployment among rural youth. To provide basic amenities in rural
areas, the Bank is encouraging setting up of rural clinics, drinking
water facilities and engaging rural volunteers for betterment of
communities.
Rural Development
The Bank, through its Canara Bank Centenary Rural Development Trust,
has established exclusive training institutes to promote
entrepreneurship development among rural youth and encourage them
taking up self-employment activities. During the year, 9 new training
institutes were opened at Aligarh and Etah districts in Uttar Pradesh,
Sheikhpura district in Bihar, Calicut and Palakkad districts in Kerala,
Nilgiris, Erode, Theni and Dindigul in Tamil Nadu, thus enhancing the
number of such training institutes to 26. These institutes have so far
trained 94935 unemployed youth, comprising 60% women with an impressive
settlement rate of 70%. The Trust is also supporting the activities of
Society for Educational and Economic Development (SEED), a voluntary
organization based in Sriperambudur, Tamil Nadu, working for the
welfare of the socially marginalized children.
The Bank has co-sponsored 23 Rural Development and Self Employment
Training Institutes (RUDSETIs) engaged in the training of rural youth
for taking up self-employment programmes. 23 RUDSETIs have trained more
than 2,38,000 unemployed youth, with a settlement rateof 70%.
The Bank is also co-sponsoring Deshpande-RUDSET! at Haliyal in
Karnataka and Andhra Pradesh Bankers Institute of Rural Development
(APBIRED) at Hyderabad in Andhra Pradesh. These two institutes are also
engaged in promoting entrepreneurship development among rural
unemployed youth.
The new campus for Canara Bank Institute for Artisans, Karaikudi was
inaugurated by Honble Union Home Minister, ShriP Chidambaram, during
theyear.
An Example for many unemployed youth in Rural India
Thousands of youth have found their ways to decent living with the aid
of training imparted by the Bank sponsored/co-sponsored rural training
institutes. One such worthy example is the case of Shri M S Nagaraj,
born to a poortraditionalcarpenterfamily. Bowed down by the hardships
of life, Shri Nagaraj had to leave his formal schooling halfway at the
age of 12 to supplement his family income. He did not know what to do
in life and was not sure whether his traditional carpentry job could
provide a decent living until he joined Canara Bank Institute for
Artisans, Mangalore, Karnataka, sponsored by the Bank. His training at
the institute has given him the objective to finesse his skills and
learn new techniques of sculpting. After successfully completing the
training, he has never looked back. Now he is a full-fledged sculptor
and is successfully handling large projects. A confident and proud
Nagaraj stilt remembers the day of opting for sculpting and sincerely
thanks the Institute for all that he has achieved in life. Today he
earns an average Rs.15,000 to Rs.20,000 per month and is happy to be a
supportive son to his parents and brotherto his sisters.
Canara Banks Rural Clinic Service Scheme provides basic health care
services in remote areas lacking basic medical infrastructure
facilities. Underthe Scheme, the Bank encourages doctors to set up
clinics in identified rural areas. As at March 2010, the total number
of such clinics rose to 518. The Bank under Jalayoga, a scheme to
provide safe drinking water, has so far implemented 35 projects in its
lead districts.
The Bank donated a hi-tech, custom built, solar powered Mobile Sales
Vanto assist women entrepreneurs, SHGs and artisans to market their
products.
Visits by Parliamentary Committees
The third Sub-Committee of Parliamentary Committee on Official
Languages had inspected our Khajuraho, Chaziabad, Raipur Branches and
CO Mysore and lauded the efforts put in by the Bank in the field of
Official Language implementation.
ORGANISATION AND SUPPORT SERVICES
Branch Network
The year was significant for the Bank in expanding domestic operations
across the country. Befitting its 104th year of existence, the Bank on
its Founders Day i.e. 19th November, 2009, opened 104 branches
acrossthe country, inaugurated by Honble Finance Minister Shri Pranab
Mukherjee. The Bank opened 314 branches during the year, taking the
total tally under the branch networkto 3046 branches.
Composition of domestic branch network
Category No. of Branches
31.03.2009 31.03.2010
Metropolitan 629 727
Urban 674 744
Semi-urban 691 793
Rural 735 779
Total Branches 2729 3043
The Bank has 118 specialized branches catering to the specificfinancial
needs of different clientele categories.
Categories of Specialized Branches 31.03.2010
1. SMEs 37
2. Overseas 17
3. Agri-Finance 10
4. Micro Finance Branches 9
5. Savings 7
6. NRIs 7
7. Asset Recovery Management 7
8. Prime Corporate 7
9. Industrial Finance 5
10. Stock Exchange 3
11. Capital Market 3
12. Mahila Banking 3
13. Consumer Finance 1
14. Housing Finance 1
15. Branch for Physically Challenged 1
TOTAL 118
InfoTech Progress
The Bank took several initiatives in the InfoTech front during the
year. As at the end of March 2010, a number of branches were covered
under Core Banking Solution (CBS) expanded to 1809, besides 29
Extension Counters, 92 Currency Chests and 80 Service Units (Accounts
Sections/Clearing Sections/Local Processing Centres/ Foreign
Departments) along with Integrated Voice Recording System (IVRS) and
Internet and Mobile Banking (1MB). Several modules/facilities come
along with CBS like SPEED-e-module for enabling clients to deliver
instruction through internet, Funds Transfer Facility for the purpose
of online trading, sales and marketing module for marketing purposes,
Lending Automation Processing System (LAPS) for Retail and Corporate
and Anti-Money Laundering (AML) modules. CBS branches covered 90% of
the Banks total business as at March 2010.
As at March 2010, the Bank had 2017 ATMs spread across 728 centres,
including 745 offsite ATMs and 180 ATMs in railway stations. It has
also set up 150 e-kiosksfor booking railway tickets. Debit card base of
the Bank further increased to about 50 lakhs as at March 2010.
The Bank implemented Centralized Online Tax Accounting System
(Government Business module) in 463 branches and Excise and Service Tax
modules in 144 branches, under CBS setup. Sales Tax module has been
implemented in all designated branches of Delhi and Maharashtra.
Local Processing Centres (LPC) have been established in 25 centres all
over India, covering 542 branches. Centralized Pension Processing cell
was introduced and 84 branches of Bangalore Metro Circle Office have
been covered. The Bank has a well-designed and secured Corporate
Network, covering all the Branches/Offices for rolling out
network-based delivery channels. All the Circle Offices have been
provided with video conference facility.
Infotech Progress 31.03.2009 31.03.2010
Core Banking Branches 1053 1809
Anywhere Banking Branches 2062 2091
Internet and Mobile Banking Branches 1362 1959
NEFT and RTGS 2729 3037
Manpower Profile
As at March 31, 2010, the Bank had 43,380 employees on its rolls.
March March
2009 2010
Total No. of Employees 44090 43380
Officers 17551 17338
Clerks 16500 16285
Sub-Staff 10039 9757
* includes part-time employees (PTEs)
During the year, the Bank recruited 1181 persons in various cadres out
of which 177 belonged to Scheduled Castes (SCs) and 129 to Scheduled
Tribes (STs) category. The total number of ex-servicemen as at the end
of March 2010 stood at 1,573 and 156 of them were recruited in various
cadres duringtheyear.There were 845 Physically Challenged Employees on
the rolls of the Bank.
Reservation Policy in respect of SCs and STs
As at March 2010, the number of Scheduled Castes and Scheduled Tribes
together constituted 25.83% of total staff strength of the Bank. The
composition of SC/ST employees in the Bank as at March 2010 was as
under:
The Bank has been strictly adhering to the Reservation Policy in
respect of Scheduled Castes and Scheduled Tribes as perGovt. of India
guidelines
- Reservation Policy is implemented through the mechanism of Post Based
Rosters. In terms of the directives of the Ministry of Finance,
Government of India, Bank has since switched over to Post Based Rosters
for all cadres.
- The Bank has been extending Reservation/ Relaxations/Concessions in
Direct Recruitment as well as in promotions to candidates belongingto
Scheduled Castes and Scheduled Tribes as per Govt, guidelines.
- Pre-recruitment and Pre-promotion training is given to candidates
belonging to SC and ST. In the Advertisement inviting applications from
eligible candidates for recruitment to Clerical and Officer cadres, a
specific reference is made with regard to imparting of pre-recruitment
training to candidates belonging to SC / ST / PWD / Minority
Communities / Ex-servicemen. Candidates who opt for pre-recruitment
training are given training to prepare themselves for written test as
well as interview.
- Study materials, note book, stationeries are provided free of cost to
all participants. Wherever possible, respective State Governments are
providing Lodging Facilities in Government/backward class hostels.
- The Bank has setup SC/ST Cell at the Head Office and at Circle
Offices to ensure maintenance of Rosters and implementation of other
aspects of Reservation Policy.
- Chief Liaison Officer has been nominated at Head Office and Liaison
Officers have been nominated at Circle Offices for ensuring
implementation of Reservation Policy.
- Further, representations received from Scheduled Caste / Scheduled
Tribe employees, either directly or through the SC/ST Associations, are
being looked into by the Liaison Officer/Chief Liaison Officer.
Wherever required, necessary enquiries are conducted and appropriate
action is taken. A separate register is maintained for ^recording
various representations received from Scheduled Caste/Scheduled Tribe
employees and the action taken is also recorded in the register.
- In additiontotheabove,therepresentativesof majority Scheduled Caste /
Scheduled Tribe Employees Association are invited for Quarterly
Meeting with the Chief Executive of the Bank to discuss on the
implementation of guidelines on reservation policy. Quarterly Meetings
are also held at Circle Offices, where Rosters are maintained and
grievances, if any, are redressed bythe Liaison Officer.
- The Board of Directors of the Bank also reviews the progress made in
the implementation of Reservation Pol icy on a ha Ifyearly and yearly
basis.
Training / Human Resource Development (HRD)
Human resources form the basic lifeline for a service- oriented
industry like banking. The HR policies of the Bank have been reinvented
and refocused time and again to suit to the changing banking scenario.
HR interventions like SPANDAN for bringing attitudinal change among
front line staff, PRATIBHA for grooming in-house talents in varied
specialized areas and executive grooming through reputed institutes and
other significant HR tools like Quality Circles, Study Circles, Staff
Meetings and Brain Storming Sessions have been implemented for
effective team building and collective excellence.
The Banks quest to enhance the competencies of the workforce will
continue through focused and need-based training at various institutes
of repute like IIMs, ISB, XLRI, NIBM etc. Customised programmes are
also being organised to develop expertise in certain niche areas like
Risk Management, Treasury Operations, IT etc.
Specialised training to Senior Management Level / Top Management Level
executives are conducted based on the requirement. The Bank has been
able to add substantially to the repertoire of knowledge of its
officials through this training intervention and motivating them to
perform with renewed vigourand enthusiasm.
The Bank has trained 31,587 employees during the year, covering a wide
range of functional areas including some of the new training programmes
like Control aspects of CBS, Financial Inclusion, Advanced Credit
Management, Marketing Programme for Counter Staff, CBS Help Desk
Training, Quality reporting for inspecting officials and Programme on
Credit Audit, Cluster MSME Programmes, HRMS package, CBS- FCR-
Champions, CBS-FCC- Champions and CASA Marketing. Out of the trained
staff, 7047 personnel were women employees, 6715 personnel belonged to
the Scheduled Caste category and 1845 personnel who received training
were under the Scheduled Tribe category.
Establishing a proper Talent Management and Reward System will be the
Banks focus in the coming years. There will be concerted efforts to
identify potential leaders and groom them to take up higher
responsibilities in the days to come. An attempt is being continuously
made to empower deserving employees so that they will become future
leaders of the organisation.
Changes in the Organizational Setup
The Bank brought out further changes in its organizational/ operational
set-up to facilitate smooth functioning and effective results. The
Organizational design and structure are continuously revisited and
studied to make inroadsforfunctional excellence.
The Bank has completely moved towards a 3 tier structure comprising
Head Office, Circle Offices and Branches. The re-structuring was
effected by delayering the Regional Office setup and thus providing
significant opportunities for growth by building stronger clientele
relationsthrough faster and effective decisions. The Organizational
Structure has been reworked to enable better execution of strategy and
ensure smooth functioning.
Customer Orientation
The Banks endeavour has always been to respond to customers by taking
conscious initiatives and showing proactive response to changing
customer expectations. The Bank offers a personalized range of
specialized and diversified products and quality service to customers.
The Bank made arrangements for providing copies of the Code of Banks
Commitment to Customersto customers at branches. An informative
booklet containing all the relevant information on Frequently Asked
Questions by Customers was made available at all branches towards
better Customer Service. The Policy guidelines relating to Collection
of Cheques/Instruments, Grievance Redressal Mechanism and Compensation
Policy were placed on the Banks website for use of the customers. As
part of Customer Relationship Management initiatives, a Call Centre was
setup during March 2008. The Call Centre caters to the customers in 6
languages viz., English, Hindi, Kannada, Tamil, Telugu and Malayalam.
The number of calls received by the Call Centre during the year was
more than 7.5 lakh.
Systems and Procedures
Risk Based Internal A^idit (RBIA) was conducted in all the 2078
branches/units programmed for on-site RBIAduring theyear. Information
Security Audit was conducted along with RBIA. Concurrent / Continuous
Audit was conducted in 763 branches/service units, of which 250
branches and
35 units were subjected to concurrent/continuous audit by internal
auditors and 461 branches and 17 service units were subjected to
concurrent audit by external auditors covering 55.01% of deposits and
87.5% of advances (as per the Business position as at 31.3.2009). 357
branches were subjected to income/revenue audit, which included
branches identified for income audit on quarterly basis in addition to
763 branches which are under concurrent/continuous audit on monthly
basis.
Know Your Customers (KYC)
The Bank took several measures for the effective implementation of Know
Your Customer (KYC) and Anti Money Laundering (AML) guidelines and
ensured 100% KYC compliance by all branches.
To ensure better compliance of guidelines on KYC / AML following steps
have been initiated.
- Printing and dispatch of Thanksgiving letters to new account holders
and introducers, centrally at Circle Office. On a trial basis the
system has been implemented at Bangalore Metro and Rural Circles.
- Branches have been advised to ensure that all the accounts are KYC
compliant.
- All Circles have nominated an Executive as Nodal Compliance Officer
for monitoring and ensuring compliance of guidelines on Know Your
Customer (KYC)/Anti Money Laundering (AML)/Combating of
FinancingofTerrorism (CFT).
Vigilance Setup
The Banks Vigilance Wing at its Corporate Office is headed by Chief
Vigilance Officer (CVO) in the rank of General Manager. The CVO is ably
aided by Vigilance Officers at all Circles, RRBs and most of the Banks
Subsidiaries. Guidelines on review, reporting and monitoring of frauds
have been issued and all the reported cases of frauds were reviewed
from adequacy of existing systems and procedures angle and necessary
preventive measures taken to prevent frauds. Fraud awareness Circulars
were issued to enhance awareness on prevention of frauds. During the
year, a leaflet was brought out containing the message of the CVO
highlighting the effective measures undertaken through system
improvements and leveraging of information technology to create
increased transparency and awareness to fight corruption besides
providing more efficient service to the customers and general public.
For preventing and detecting frauds and other irregularities, the Bank
took adequate measures, such as introduction of early warning signals,
revised norms for security verification and introduction of
surveillance audit, visit of General Manager, Inspection Wing for
effective monitoring of the Circles, where large scale frauds have
occurred. As directed by the Central Vigilance Commission, Vigilance
Awareness Week was observed from 3rd to 7th November, 2009.
Security Arrangements
The security environment in the Bank remained, by and large, normal
during 2009-10. There were 52 incidents of crime during the year
involving a loss of Rs. 12.61 lakh. There was one major fire incident
during theyear and loss approximated to Rs. 21 lakh. The security
arrangements have been reinforced by installation of CCTV in all
Currency Chests and identified branches. Modem fire safety devices have
been introduced at select Offices. Fire safety drills have been
introduced and practiced at regular intervals in order to minimize
damage to property and prevent injury and loss of life.
Ambience Improvement
All the new branches opened in prime localities and branches shifted to
new premises during the year were provided with suitable interiors to
meet the present day requirements of the customers. Besides, the Bank
is providing better interiors to augment the requirements of the
computer environment and also proposes to enhance theambienceatall
branches.
Right to Information
Under the Right to Information Act, 2005, the Bank set up an exclusive
Right to Information Act outfit to provide information and bring
transparency. During the year under review, the Bank dealt with all the
1666 applications/ appeals received as perthe provisions of the Act.
Implementation of Official Language
The Bank made noteworthy progress under the implementation of Official
Language during the year under review. As at March 2010, around 95% of
employees have obtained working knowledge in Hindi and the Bank has
notified 2290 branches under Rule 10 (4) of OL Rules 1976. All the
employees of the Bank possessing working knowledge of Hindi have been
trained in Hindi workshops. During the year under review, Bank has
conducted 179 refresher training programmes for such employees.
In the sphere of using Information Technology in the Official Language,
the Bank has furthered the use of Shabdaratna and Akruti packages for
word processing, usage of Bankscript package for Data Processing and
also made provision in ATM screens of the Bank for carrying transaction
in 10 Indian languages. Telebanking facility has also been provided in
Hindi and English and other 6 major regional languages. The Banks
corporate website isfully bilingual.
To encourage effective implementation of Official Language, the Bank
has introduced various schemes and awards to its employees. Official
Language Implementation Committees are constituted in all the branches
of the Bank to motivate and guide the employees towards effective
implementation of Official Language Policy ofthe Govt, of India.
Promotion of Sports
Canara Bank has always been encouraging and supporting sports and
contributed generously to sporting activities all overthe country by
sponsoringtournaments and providing scholarships to talented sports
persons. The Bank has shown a keen and abiding interest in recruiting
sports persons and has on its rolls 42 sports persons in six
disciplines viz., Cricket, Hockey, Womens Athletics, Badminton, Ball
Badminton andTableTennis.
International Cricketers Shri B K Venkatesh Prasad, Shri Sunil Joshi,
Ms Shantha Rangaswamy, Ms Kalpana and Ms Sudha Shah (Coach of the
Indian Womens Cricket Team) are presently in the Banks fold. Ace
Shuttler and former National Champion and former coach ofthe Indian
Badminton Team, Shri U Vimal Kumar, International Athletes - Smt. M K
Asha, Smt. Suma Gopalakrishna and Smt. H M Jyothi and Hockey
Internationals - Shri Bharat Chhetri and Shri PShanmugam are also on
the Banks rolls.
Canara Bank recorded several distinctions in the sporting arena and the
Banks Cricket, Ball Badminton and Table Tennis Teams rank numero uno
in the State of Kamataka.
FINANCIAL SUPERMARKET
Subsidiaries, Sponsored Entities and Joint Ventures
Canara Bank, with fhe objective of offering OneStop Banking Mart for
the customers, forayed into diversified business activities by opening
subsidiaries during late 1980s. Today, the Bank functions as a
Financial Supermarketwith as many as nine subsidiaries/sponsored
entities/joint ventures in diversified areas.
The Bank has taken significant steps towards strengthening fundamentals
of these entities so as to emerge as a strong Financial Supermarket"
in India. All the subsidiaries/ sponsored entities/ joint ventures of
the Bank recorded satisfactory performance duringthereportingyear.
Commercial Bankof India LLC(CBIL)
CBIL, a joint venture of Canara Bank and State Bank of India, has been
operational since April 2004 in Moscow, Russia. The Company earned a
profit aftertax of USD 2.15 million as at 31st March 2010.
Canbank Venture Capital Fund Limited (CVCFL)
CVCFL, the Trustee and Manager of Canbank Venture Capital Fund (CVCF),
is a wholly owned subsidiary of the Bank. Currently, it manages two
Funds with a corpus of Rs. 23.85 crore. During the financial year
2009-10, CVCFL assisted 95 Ventures, involving a sum of Rs. 108.90
crore. The Company recorded a profit after tax of Rs.71.02 lakh for the
year 2009-10. CVCF is all set to float 5th Fund with a corpus of Rs.
500 crore. The Company has been continuously payingdividend.
Can Fin Homes Limited (CFHL)
CFHL, a sponsored entity of Canara Bank, is one of the premier housing
finance entities in the country. The Company sanctioned and disbursed
loans amounting to Rs.653 crore and Rs.547 crore respectively, taking
cumulative sanctions to Rs.6172 crore and disbursement to Rs.5329 crore
as at March 2010. The company posted a profit after tax of Rs.39.18
crore as at March 2010 as against Rs.31.52 crore duringthepreviousyear.
Canbank Factors Limited (CFL)
Canbank Factors Limited, which is a factoring subsidiary of the Bank,
is a member of Factors Chain International. Factors Chain
International is an umbrella organization for factoring companies
across the world. The company achieved a total business turnover of Rs.
3735 crore as at 31.03.2010. The Company has earned Profit after Tax of
Rs. 24.37 crore as at March 2010. The Company paid a dividend of Rs.
224 lakh to the Bank.
Canbank Computer Services Limited (CCSL)
Canbank Computer Services Limited is the only Software Company promoted
bya public sector bank in the country.
CC5L is primarily engaged in Hand Software development services,
training/consultancy and registrar and share transfer agency. The
Company is a member of NASSCOM and Registered as a software solution
provider for World Bank projects. The Company has posted profit after
tax of Rs. 110.31 lakh as on 31.03.2010. CCSL received orders for
managing CBS Help Desk of Canara Bank and its operation is likely to
commence from May 2010. The Company has been successfully managing the
Call Centre activity of Canara Bank and started attending outbound
calls also. During the year, the Company also conducted Information
System Audit Training for Officials in Inspection Department and IT
Department of Pragathi Gramin Bank.
Canara Bank Securities Limited (CBSL)
Canara Bank Securities Limited (Formerly Gilt Securities Trading
Corporation Limited) which was established as Primary dealer, has hived
off Primary Dealer business to the parent Bank. The Company has
diversified into Capital Market related activities, mainly stock
broking since 2007. The Company offers stock broking services to both
institutional and retail clients. Online Trading Counter for retail
customers is its flagship product. The Company entered Currency
Derivatives during 2009-10. The Company posted a Profit after Tax of
Rs. 6.51 crore as at March 2010. The Company declared its maiden
dividend and paid dividend of Rs. 4 crore to the Bank.
Canbank Financial Services Limited (Canfina)
Canbank Financial Services Ltd confined its activities to legal matters
arising out of past transactions in securities, besides concentrating
on collection of lease rentals and recovery of dues under decreed
accounts. Du ri ng theyear, Canfina posted a profit aftertax of Rs.
2.58 crore. It repaid Rs. 326.45 crore out of the funding support of
Rs. 376.45 crore given by the Bank and proposes to clear the entire
liability of Rs. 50 crore outstanding, during the current fiscal year.
Canara Robeco Asset Management Company Limited (CRAMC)
To manage assets of Canbank Mutual Fund, M/s Canbank Investment
Management Services Limited (CIMS) was established in 1993. In the year
2007, Canara Bank divested 49% stake of Asset Management Company in
favour of M/s Robeco Groep N V forming a joint venture, for managing
the assets of Canbank Mutual Fund (since renamed as Canara Robeco
Mutual Fund). The company has since been renamed as Canara Robeco Asset
Management Company Limited. The JV aims to capture a worth while market
share of Mutual Fund industry by bringing best international practices
and expertise supported by the vast network of the Bank. With a
majority share of 51% held by the Bank, Assets Under Management (AUM)
of the Company improved to Rs. 7632 crore and Corpus fund increased to
Rs. 5879 crore, with investors base of 3 lakh as at March 2010. The
Company is currently managing 18 Schemes.The Fund crossed the milestone
AUM of Rs. 10000 crore during February 2010. Canara Robeco Asset
Management Company was nominated for Best AMC - ranked as the 2nd best
AMC at Business world MF Awards and received Best Bond Fund House Award
at Lipper Fund Awards 2010.The company has improved its rankingfrom 26
out of 32 fund houses to 16 out of 37 fund houses as at March 2010.
Canara HSBC Oriental Bank of Commerce Life Insurance Company Limited
An Insurance Joint Venture floated by the Bank in association with
internationally reputed HSBC Insurance (Asia Pacific) Holding Limited
and Oriental Bank of Commerce. The Company was incorporated during
September 2007. With a majority shareholding of 51% in the Company, the
Bank has ventured into a niche segment, with a fine blend of
international expertise and its own domestic outreach. The Company
commenced its business operations from 16.06.2008 by offering products
viz., Child Plan, Saral Bima Plan, Stay Smart, Retire Smart and Saral
Bima Plus. In addition, mandatory and non-mandatory Group Credit
protection schemes were also launched. The Companys assets under
management (AUM) during the year stood at Rs. 1314 crore as on
31.03.2010. The Company has registered an Annualized Premium Equivalent
(APE) of Rs. 644 crore in its second year of operation.The Company has
crossed Rs. 1000 crore in terms of total premium since inception and
has become the fastest to achieve this milestone in a record time of 21
months. Out of the 22 private players in the insurance field in
India,the Company is ranked 13th.The Company has doubled its market
share at 1.8% during 2009-10 from 0.9% in 2008-09.
Regional Rural Bank; (RRBs)
Canara Bank sponsored 3 RRBs in three States with a network of 793
branches, viz., Pragathi Gramin Bank in Karnataka, Shreyas Gramin Bank
in Uttar Pradesh and
South Malabar Gramin Bank in Kerala. All RRBs sponsored by Canara Bank
are profit making as at March 2010 with a combined operating profit
level at Rs.165 crore and profit aftertax of Rs. 108 crore. Aggregate
business level of these RRBs crossed the Rs.17000 crore mark to reach
Rs.17509 crore, comprising Rs.9444 crore under deposits and Rs.8065
crore under advances as at March 2010. Gross NPA ratio of these RRBs
was 2.28% and Net NPA was 1.24% as at March 2010. In tune with policy
focus to double the credit flow to agriculture sector, the RRBs
disbursed an amount of Rs.5125 crore, recording a y-o-y growth of 27.9%
during the year under review. Priority sector advances constituted
88.79%. Agriculture credit outstanding stood at Rs.5768 crore as at
March 2010. During this financial, Pragathi Gramin Bank achieved
number one position in business in South India, apart from maintaining
the number one position in Karnataka. While South Malabar Gramin Bank
continues to occupy number one status in Kerala, Shreyas Gramin Bank
was number one under Employee productivity in Uttar Pradesh. All the
three RRBs are taking necessary steps to implement CBS in all their
branches by September 2011.
AWARDS/ACCOLADES
In recognition of the varied initiatives, the Bank was conferred with
several awards and accolades during the year. Some prominent awards
received areas under:
Best Bank in South Zone Award for the year 2008-09 in respect of
lending under KVIC and PMEGP Schemes. The award was handed over by Dr.
Manmohan Singh, Honble Prime Ministerof India.
The Bank received the Credit Guarantee Approval Certificate issued by
CGTMSE from Shri Pranab Mukherjee, Honble Finance Minister of India.
VARIOUS POLICIES OF THE BANK
There is a system of well-defined policies and procedures of the Bank.
During the year, concerted efforts were made to streamline the policies
and procedures of the Bank in the light of regulatory requirements of
the RBI, the directions of the Government of India and the emergent
requirements of the Bank in the present day context. Accordingly,
there has been a sharper focus on policies relating to, among others,
Credit Risk Management, Market Risk Management, Operational Risk
Management,
Asset Liability Management, Liquidity Risk Management, Country Risk,
Counterparty Bank Risk, Corporate Governance, Disclosures, Collateral
Management, Stress Testing, Compliance Functions, Disaster Recovery and
Business Continuity Planning, Business Lines, Outsourcing and Internal
Capital Adequacy Assessment Process (ICAAP), Know Your Customers (KYC),
Anti-Money Laundering (AML), Recovery and Investments.
CHANGES IN THE BOARD OF DIRECTORS
Year 2009-10 saw changes in the com position of the Board of Directors
of the Bank.
- The term of Shri Ajay Mathur as Part-time Non-Official Director on
the Board ended on 12.10.2009.
- The term of Shri S KKohli as Officer Employee Director ended on
07.03.2010.
DIRECTORS RESPONSIBILITY STATEMENT
The Directors, in preparation of the annual accounts for theyearended
March 31,2010, confirm thefollowing:
- That in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures.
- That they had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Bank at the end of the financial year and of the profit or loss of
the Bankforthe period.
- That they had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of
applicable laws governing banks in India for safeguardingthe assets of
the Bank and for preventing and detecting fraud and other
irregularities.
- That they had prepared the annual accounts on a going concern basis:
ACKNOWLEDGEMENT
2009-10 was an eventful year for the Bank as it regained growth
momentum and crossed three major milestones. The Bank made several
initiatives to maximize rewards for all its stakeholders, viz.,
shareholders, customers, investors, Government, RBI, employees and the
public at large.
The Board sincerely appreciates the significant contribution made by
the Directors on the Banks Board and the Directors who completed their
tenure during the financial year under review, to customers for their
patronage, to the shareholders for their support, to the Government and
the RBI for their valuable guidance and support, to the Banks
correspondents inland and abroad for their cooperation and goodwill and
to all the staff members for their full support in the journey towards
excellence.
A C MAHAJAN
CHAIRMAN AND MANAGING DIRECTOR
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