“Saraswat bank”

SUBMITTED BY: Premjeet kumar UNDER GUIDANCE OF Rita Dangre

Masters in Marketing Management INDIRA INSTITUTE OF MANAGEMENT, PUNE (2011-2013)


Chapter No. 1 2 3 4 5 6 7 8 9 10 11 12 Title Introduction Corporate office Sector Analysis Sales turnover Market capitalization Product profile Business strategy Growth path SWOT analysis CSR Innovation News Page No.




Saraswat Bank pronunciation is an urban co-operative banking institution based in Maharashtra, India and operating as a co-operative bank since 1918 In 1988, it was conferred with scheduled status by Reserve Bank of India. The bank has observed good growth during the 2000s with total business growing from 40 billion rupees in 2000 to 230 billion rupees in 2010 (approx. 5 billion US$). The bank has been granted a pan-India operation license by the Reserve Bank.

Type Industry Founded Headquarters Products

Revenue Net income Employees

Public company Banking , Financial services. 1918 Mumbai, India Investment Banking Commercial Banking Retail Banking Private Banking Asset Management Mortgages Credit Cards 27,313 crore (US$5.46 billion)(2010-11) 358.19 crore (US$71.64 million)(2010-11) 3338


. The symbol takes off from our earlier logo and visualizes a hexagon. It is an attempt toappeal to younger and new customers without alienating the existing ones. The logo represents two caring hands in the shape of a hexagon. The upper hand is of golden yellowcolour. Yellow is the colour of warmth, sunshine, cheer and happiness. Gold of wealth, prosperity and ever increasing value. They are the colours of the Sun and symbolize life,youth and harmony. The lower hand is burgundy red, the colour of excitement, strengthand passion. It symbolizes aggressiveness and in the Indian context, Soubhagya. 8) COMPANYHISTORY: "The Saraswat Co-operative Banking Society" was founded on 14th September 1918. Mr.J.K. Parulkar became its first Chairman, Mr. N.B. Thakur, the first ViceChairman, Mr.P.N. Warde, the first Secretary and Mr. Shivram Gopal Rajadhyaksha, the first Treasurer.These were the people with deep and abiding ideals, faith, vision, optimism and entrepreneurial skills.The Society was initially set up to help families in distress. Its primary objective was to provide temporary accommodation to its members in eventualities such as weddings of dependent members of the family, repayment of debt and expenses of medical treatmentetc. The Society was converted into a full-fledged Urban Co-operative Bank in the year 1933. The Bank, which was originally founded in 1918, i.e. close on the heels of the

24 Russian Revolution, also witnessed as a Society and as Bank-the First World War, the Second World War, India's freedom Movement and the glorious chapter of post-independence India. During this cataclysmic cavalcade of history, the Bank as a financial institution and its members could not of course remain unaffected by


the economic consequences of the major events. The Founder Members and the later-day management's of the Bank continued to demonstrate their unwavering faith in the destiny of the common man and the co-operative movement. By 1942, the Bank was fulfilling all the banking needs of its customers. The Bank had established five branches within the city of Mumbai and one each at Pune and Belgaum. The Bank has grown in stature, progressed in its social and economic objectives and produced an image of what an ideal bank should be.Resultantly, in the year 1977-78, the Bank's gross income crossed the Rs.3.00 Crore mark

The history of Saraswats is a record of their struggle for existence and a chain of migrations, the longest and the most wide spread among any groups in India. Even after generations and centuries they preserve their culture and traditions intact. Their traditions are unique and tolerant that they worship Shakti, Shiva and Vaishnava deities as well.

The bank is registered on 14th September 1918, & its area of operations in States of Maharastra, Karnataka, Goa, Union Territories of Daman, Diu & Delhi & Municipal limits of Indore City in Madhya Pradesh. 2004 -Saraswat Bank has signed a bancassurance pact with HDFC Standard Life Insurance Comp. for distributing the latter range of insurance & pension products -Enters into a tie-up with Tata AIG Life Insurance Co. limited to offer Tata AIG Life Group Mortgage Reducing Term Insurance [GMRTIs] policy to the bank mortgage [homes] loan customers 2005 -Maratha Mandir approves voluntary merger with Saraswat Bank


Who are Gowda Saraswat Brahmins?
The Gowda Saraswat Brahmins claim their origin to the Brahmins who lived on the banks of the now extinct river Saraswati of Punjab. They derived their name from either the river Saraswati or from their spiritual leader Great Sage Saraswat Muni who lived on the banks of Saraswati. These Brahmins were one of the Pancha Gowda Brahmin groups who lived north of the Vindhyas. They belonged to Smarta tradition and primarily worshiped the five deities: Shiva, Vishnu, Devi, Surya and Ganesha. Throughout the course of history, the Saraswat Brahmins have migrated to a variety of locations and are found mostly in Western coast of India.

The origin
The exact origin of the Saraswat Brahmins is difficult to ascertain. The Saraswat Brahmins are mentioned in the Vedas, the Ramayana, the Mahabharata, the Bhagavata and even the Bhavisyottara Purana. According to Puranas, they are Aryan migrants from Central Asia who came to the Indian sub-continent through the Hindu-Kush mountains and the Khyber pass to south in about 2000-1500 B.C. Most of them settled along the banks of Saraswati river. There were more than 1200 such settlements of migrants. They settled to an agrarian life, supplemented by cattle grazing. These settlers came to be known as Saraswats. Education was of great importance to the Saraswats and so they taught their young the Sanskrit language and enlightened themselves from the Rig Veda. Although they spoke Sanskrit in public, they innovated a simplified version of Sanskrit called Brahmani which they spoke only at home. This language was the grass-root for the present day Konkani language. Over the years along the Saraswati, the Saraswats established the concept of Kuladevatas or family gods, and began worshipping them. They accepted the Great Sage Saraswat Muni (son of Rishi Dadichi), living on the banks of Saraswati as their Guru. There were about 60,000 (Shatsahasara) Brahmins who were his disciples. When a severe famine which lasted for about 12 years hit the region and the crops were not enough to feed everyone, the survival of the Saraswats was at stake. When they could find no apparent solution to their vexing problem, at the advice of their Guru who was pragmatic, they started to feed on fish from the Saraswati river for survival. Thus they became the only fish-eating Brahmins ever known. This settlement was in the land between the saraswati and Drishadvati rivers.


Corporate office:

Address: REGISTERED OFFICE : „Madhukosh‟, S.V.Sovani Path, Girgaum, Mumbai – 400 004. lCORPORATE CENTER : Saraswat Bank Bhavan, Plot No. 953, Appasaheb Marathe Marg, Prabhadevi, Mumbai – 400 025. Website : www.saraswatbank.com




Banking sector:
Overall, financial markets remained orderly. With the revival of foreign institutional investment, equity markets gained strength and the BSE stock index nearly doubled from 9,709 as on 31st March, 2009 to 17,528 as on 31st March, 2010. As regards debt markets, long-term yields hardened significantly from 7.01 per cent to 7.84 per cent, while short-term rates remained low. The Rupee strengthened against the US Dollar to close at ` 44.90 by 31st March, 2010 (an appreciation of 11.87 per cent) on the back of increase in FII inflows and continued inflow of foreign direct investment. India‟s foreign exchange reserves increased by USD 27.1 billion to reach USD 279.10 billion at the end of March, 2010.

Company Profile
The Saraswat Bank sports a new logo, which represents a change in the outlook of the Bank as also the zeal to embrace the changing organizational ethics with open arms and improvise its functions, systems and procedures to suit modern day banking. The new logo has indeed been accepted and appreciated as an excellent tool for our brand positioning and image building of the Bank. It has also radically changed the opinion of a very large segment of people who earlier considered every co-operative Bank to be an obsolete financial institution with a status- quoist and stagnant image. The new branches of Saraswat Bank, opened after the launch of the new logo, are a delight to visit and see, in terms of ambience, systems as well as the services offered, which are in tune with our mantra of “delighting our customers and amazing our competitors”. The functioning of the corporate office and several of the Bank‟s departments from the corporate centre “Saraswat Bank Bhavan” at Prabhadevi will, in the above backdrop, provide a tremendous advantage to your Bank. With “Saraswat Bank Bhavan”, your Bank has transitioned from an old-generation Bank and have indeed arrived as a modern 21st century Bank. This provides boost to the Brand – Saraswat Bank.


Recruitment :
With growing business development and opening of branches this year, investment in human capital assumed great importance. During the year, total 431 employees were recruited for manning additional positions and for strengthening our marketing and operations. Of these, 87 are in Management cadre and 344 in NonManagement cadre. With this recruitment, your Bank now employs a total of 2,911 persons in the Bank.

Promotional Exercises :
In order to cater to the growing expanse of your Bank and the need for managerial positions in the wake of the same, the Bank conducted promotional exercises to various cadres. A total of sixty-eight employees were promoted to various cadres during the year. All promoted personnel have been suitably placed in various branches / departments including in existing branches of the merged banks and the newly opened branches.

The Branch Expansion – HRD Support :
Identification and selection of right personnel for new branches with competencies and capabilities to take up the challenges and with capacity to effectively shoulder the responsibilities in future has become key responsibility of the HR function of the Bank. New branches have been provided with the employees who have flair for marketing along with adequate knowledge and experience of banking operations and branch management. A new cadre of Marketing and Operation Personnel has been created to provide thrust for marketing efforts at the branches. All new recruitments, excepting of professionally qualified persons are made as marketing & operational personnel. A blend of lateral recruits, qualified fresher‟s and internal experienced staff has been provided to the new branches.

Industrial Relations:
The Bank has always respected the rights, role and existence of the employees‟ organizations. Mutual Trust, Respect and Acceptance are underlying principles of every relationship. Along with the Board of Directors and Executives, the Officers Association and the Employees Unions are the pillars of our Bank on which the stability, sustainability and development of the organization rests. The Bank pays special attention to the well being of its employees, by giving them pay scales, benefits and service conditions, which are comparable to the industry. At the same time, the Bank expects excellent performance and contribution, which will take the


Bank ahead in the competition. Satisfied, motivated and committed workforce is behind success of your Bank. There is cordial and ongoing dialogue with employees‟ organizations on all issues raised by them. The Union and the Association have always responded favourably on issues raised by management with them. The employees‟ organizations have shown complete commitment to ensure that Bank marches on its well-defined path of progress.

During FY 2007-08, a new fortnightly house magazine titled „Madhusatva‟ was launched as a mouthpiece of our Human Resources Department. The first issue of Madhusatva was published on 14th October, 2007 and was released in the Branch Managers‟ Conference of the Bank. The magazine was launched in the context of the felt-need to create greater awareness about the functioning of your Bank amongst the large number of employees of the seven merged banks, who were absorbed in your Bank as also newly recruited staff so as to help their faster and better assimilation and integration in the Bank.


Sales turnover


Particulars Total Income Total Expenditure Gross Profit Less: Provisions Net Profit Before Tax and Exceptional Items Less: Income Tax Net Profit after Tax and before Exceptional items Less: Exceptional Items Net Profit Own Funds Share Capital Reserves and Surplus Deposits Current Savings Term Advances Secured Unsecured Priority Sector % to Advances Small Scale Industries Small Businessmen and Traders Other Priority Sectors Working Capital Investments Borrowings and Refinance Net NPAs (%) Capital Adequacy (%) Number of Members Regular * Nominal Number of Branch Licences

FOR THE YEAR ENDED 31-Mar-09 31-Mar-10 % Change 1,499.92 1,458.20 -2.78% 1,174.56 1,242.36 5.77% 325.36 215.84 -33.66% 9.75 36.68 276.21% 315.61 179.16 -43.23% 74.32 241.29 30.50 210.79 1,174.21 77.50 1,096.71 12,918.85 916.22 2,302.13 9,700.50 8,110.41 7,995.04 115.37 4,940.81 60.92% 2,454.11 556.78 1,929.92 15,622.82 4,791.51 664.00 0.00 40.00 139.16 -46.18% -42.33%

19.49 -36.10% 119.67 -43.23% AT THE END 1,270.37 8.19% 86.23 11.26% 1,184.14 7.97% 14,266.73 10.43% 1,244.30 35.81% 3,003.37 30.46% 10,019.06 3.28% 9,250.35 14.06% 9,151.61 14.47% 98.74 -14.41% 5,300.48 7.28% 57.30% – 2,946.54 20.07% 689.47 23.83% 1,664.47 -13.75% 17,071.06 9.27% 5,321.39 11.06% 562.00 -15.36% 0.00 0.00 10.92 14.63 1,29,741 4,67,644 175 1,34,417 4,94,292 200


Market capitalization


Share price since 2007:


Product Profil
It is our earnest Endeavour to offer suite of new and competitive financial products and services. We have for this purpose tied up with various insurance companies. The details of tie-up and products offered are given below:

:We are the Corporate Agents for the distribution of Life Insurance products, of M/S HDFC Standard Life Insurance Co Ltd. Under this tie up arrangement, we offer following life insurance products:

Protection plan
Protection Plans help to shield your family from uncertainties in life due to financial losses in terms of loss of income that may dawn upon them in case of your untimely demise or critical illness. Protection Plans go a long way in ensuring your familys financial independence in the event of your unfortunate demise or critical illness. They are all the more important if you are the chief wage earner in your family. No matter how much you have saved or invested over the years, sudden eventualities, such as death or critical illness ,always tend to affect your family financially apart from the huge emotional loss.

Children plan
Childrens Plans help to save, so that you can ful fill your childs dreams and aspirations. These plans go a long way in securing your childs future by financing the key miles tones in their lives even if you are no longer around to oversee them. Childrens Plans help you save steadily over the long term so that you can secure your childs future needs, be ithigher education, marriage or anything else. A small sum invested by you regularly can help you build a decent corpus over a period of time and go a long way in providing your child a secured financial future along with


Business Strategy
India Infoline today entered into a strategic alliance with Saraswat Bank to equity research, broking and portfolio management services to its clients. According to a release issued by the company to the BSE, India Infoline will extend its broking facilities to Saraswat Bank customers; both online as well as offline, via its broking brand, 5paisa.com. A Memorandum of Understanding for the strategic alliance was inked today by Nirmal Jain, CMD, India Infoline and Samir Banerji, MD, Saraswat Bank. Under the alliance, Saraswat Bank customers will have access to the company's world-class research and online technology platform at no cost. They will be offered the most competitive brokerage rates as well. Also the customer will have flexibility to trade in equities, derivatives as well as commodities through any mode namely internet, telephone or physically at any of the company's branches; all using one account, the release adds. Further, as a special offer, the company has waived off the software license fee for Saraswat Bank customers. The two organizations are working on integrating the technology platforms so that if the customer has depository account with the bank, he/ she will be able to sell those shares without any cash margin and trade seamlessly. The technology will also allow trading through temporary blocking or transfer of funds from the customer's bank account as margin.


Growth Path
Saraswat Bank On Growth Spree
Friday, June 10, 2011 By Manik K. Malakar

June 2011 will prove to be a memorable period for the Saraswat Co-Operative Bank for in this month the bank has crossed two important milestones that will shape a new chapter for the bank going forward. “We have had a wait of 93 years for this day,” says Eknath Thakur the Chairman of the Saraswat Co-Operative Bank. So the bank has now received from the RBI a licence to operate on a pan India basis. “We will start with the Southern states,” said Thakur giving an insight into the stategy that the bank will adopt in their expansions. So Kerala, and Andhra Pradesh amongst others will be a priority. After that the National Capital and the area around it will be the next priority and Rajasthan after that. The bank in another milestone is now the largest co-operative bank in the country. It was previously the largest amongst the urban cooperative banks but is now the largest co-operative bank in a segment that includes urban as well as state cooperative banks.


SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses ,Opportunities, and Threats involved in a project or in a business venture. It Involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieve that objective. The techniqueis credited to Albert Humphrey, who led a convention at Stanford University in the 1960sand1970s using data from Fortune 500 companies.

Strenths :
It specifies the attributes of the person or company that are helpful to achieve the objective(s) Saraswat Bank is No. 1 amongst the 1,700 UCBs in the Urban Cooperative Banking Sector in India with over 90 years of cumulative banking experience. High standard regulatory environment. Flexible work permit system and good quality staff offering personal client service. Bank has implemented Core Banking Solution (CBS) in the Bank. This solution primarily aims at having a unified customer approach. Bank is a member of the Credit Information Bureau India Ltd. (CIBIL). CIBIL is Indias first credit information bureau and is a repository of factual information on the credit history records of millions of commercial and individual borrowers.

The government has refused to dilute its stake in PSU banks below 51% thus choking the headroom available to these banks for raining equity capital. Lack of competitive differential with other offshore centres Rigid legislation that inhibits business development


External conditions that are helpful to achieving the objective(s). Maharashtra State has a huge banking business market of around Rs. 17,00,000/crore. Of these Rs. 17,00,000 crore, Saraswat Bank has a business stake of only Rs. 20,000 crore, which is aminiscule of merely 1.2% share in the total banking business in the State of Maharashtra. This provides a huge opportunity to the bank.

Rise in inflation figures which would lead to increase in interest rates. Increase in the number of foreign players would pose a threat to the PSB as well as the private players Anti-offshore regulations in foreign target markets restricting the development of products and new markets. Downsizing and reduction in banking operations in favour of rival jurisdictions. Outsourcing to cheaper jurisdictions Subsequent impact on rest of finance sector ecosystem


Corporate social responsibility


The Social Inclusion and Corporate Responsibility Workshop was held on the 21st of November 2008 at the Metropole Conference Centre in Fitzroy, Victoria. It was facilitated by Linda Funnell-Milner (Director, Corporate Response Ability) and coordinated by Emer Diviney. The proceedings are aimed at fostering, informing and stimulating public reflection, discussion, debate, research, and policy initiatives to address one of the central challenges facing contemporary Australian governments, industries and communities. Why should banks have a role in addressing financial exclusion? I argue that banks, together with government and the community sector, have a key role to play in addressing the lack of access to small amount, short-term credit for low income Australians. Imposing such a role on banking corporations can be justified on the basis that banks, as well as other corporations, have a responsibility beyond that owed to shareholders, extending to a broader stakeholder group including members of the communities in which they operate. This broader responsibility has been recognised by banks themselves, many of whom publish annual corporate social responsibility reports, noting the importance of corporate social responsibility („CSR‟) to their businesses. Examples include: Corporate Social Responsibility (CSR) includes the way we make business decisions, the products and services we offer, our efforts to achieve an open and honest culture, the way we manage the social, environmental and economic impacts of our business and our relationships with our employees, customers and other key stakeholders. We recognise that it is important to take a long-term view rather than simply focusing on short-term returns

I adopt a definition of CSR referred to by Parkinson as „profit-sacrificing CSR‟: Behaviour that involves voluntarily sacrificing profits, either by incurring additional costs in the course of the company‟s production processes, or by making transfers to non-shareholder groups out of the surplus thereby generated, in the belief that such behaviour will have consequences superior to those flowing from a policy of pure profit maximisation This goes beyond a concept of profit-maximisation constrained only by law and regulatory compliance, which was very much the limited approach to CSR taken by the Corporations and Markets Advisory Committee which defined CSR in the


following terms: A company will be seen to be socially responsible if it operates in an open and accountable manner, uses its resources for productive ends, complies with relevant regulatory requirements and acknowledges and takes responsibility for the consequences of its actions. (2006, p.iv) This view of CSR contemplates companies giving consideration to social and public welfare questions in making decisions, even where some profit-sacrifice is involved. The „superior consequences‟ referred to may include strategic benefits to a corporation, for example in terms of its public image and reputation, and in that sense may result in profit return in the long-term, notwithstanding short-term profit sacrifice. Alternatively, those superior outcomes may be more philanthropic, being socially beneficial but not necessarily of strategic benefit to the corporationalthough even then, reputational benefits to the corporation might be shown.




During the year, your Bank has actively pursued its set goals, within the regulatory framework and in a achievements of your Bank during FY 2010-11 are as follows: (A) During the FY 2010-11, total business of the Bank (i.e. deposits plus advances) increased from ` 23,517.08 crore as on 31st March, 2010 to ` 27,312.95 crore as on 31st March, 2011 i.e. an absolute growth of ` 3,795.87 crore and of 16.14 per cent, on a year-on-year (y-o-y) basis. (B) The deposits grew from ` 14,266.73 crore as on 31st March, 2010 to ` 15,800.96 crore as on31st March, 2011 i.e. a rise of 10.75 per cent, while advances increased from ` 9,250.35 crore as on 31st March, 2010 to ` 11,511.99 crore as on 31st March, 2011 i.e. a rise of 24.45 per cent. (C) You are aware that during the last quarter of FY 2009-10, we had acted as a nodal intermediary for MHADA. In that role, we had garnered a total MHADArelated business of ` 1,340.34 crore. Though that business was for a period of three-four months, as we procured it in the FY 2009-10. Deposits and advances so garnered under the MHADA scheme are considered a transient addition to our business. If that transient business is deducted, then as the MHADA-related business is out of our books now, the growth year-on-year over FY 2009-10 of total business stood at ` 5,136.21 crore of which growth in deposits stood at 18.35 per cent, while advances over the same period scaled up by 30.25 per cent, both of which are much higher than the industry average (Banking industry deposits grew by 15.37 per cent and advances increased by 20.60 per cent y-o-y during the same period). (D) The Credit Deposit (CD) Ratio has improved from 64.84 per cent as on 31st March, 2010 to 72.86 per cent as on 31st March, 2011. This as our aggressive credit marketing. Our credit and wholesale - worked ceaselessly, used credit processing, sanctions and disbursements. items) has improved from ` 179.16 crore in FY 2009-10 to ` 294.80 crore in FY 2010-11. ` 119.67 crore in FY 2009-10 to ` 212.27 crore in FY 2010-11, which is the highest ever net a sharp rise y-o-y of 77.38 per cent. It must be admitted that this hefty percentage increase is partly owing to a low base in FY 2009-10 when of a precipitous fall in credit demand and


lower returns on investments. However, even after accounting for that setback, there is a sharp (F) During FY 2010-11, we could reprice deposits of over ` 1,900 crore with lower interest rates. This resulted in a drop in the cost of deposits. A sharp rise in interest income coupled with drop in cost of deposits has helped Bank‟s Net Interest Margin (NIM) improve substantially by 91 basis points on a yo-y basis from 2.61 per cent as on 31st March, 2010 to 3.52 per cent as on 31st March, 2011. (G) The Cost to Income Ratio dropped from 56.86 per cent as on 31st March, 2010 to 49.26 per cent as on 31st March, 2011, for the reasons already stated at (F) above. 4.11 lac as on 31st March, 2010 to ` 6.36 lac as on 31st March, 2011 in spite of the addition of 427 employees to the total workforce of your Bank. (I) The Business per Employee grew from` 8.08 crore as on 31st March, 2010 to ` 8.18 crore as on 31st March, 2011. This rise is in spite of the fact that your Bank added 427 employees to its human resources, as pointed out herein above. (J) All the gross NPAs have been fully provided for your Bank continued to retain its coveted position as Zero Net NPA Bank, for the seventh successive year. The Provision Coverage Ratio(PCR) of your Bank is a healthy 100 per cent, as against PCR of 75 per cent, which is prescribed by RBI for commercial banks. (K) The own funds of your Bank have increased from ` 1,270.37 crore as on 31st March, 2010 to ` 1,473.49 crore as on 31st March, 2011.The Capital to RiskWeighted Assets Ratio (CRAR) is now at 12.74 per cent, well above the 9 per cent prescribed by RBI. branch network during the year under Report. The total number of functional branches grew to 216 as on 31st March, 2011. These include 209 Branch. (M) Business per Branch rose from ` 117.58 crore as on 31st March, 2010 to ` 126.45 crore as on 31st March, 2011. This increase in average business per branch is in spite of the addition .The achievement of per branch business has branches and their average business.



The market is seeing discontinuous growth driven by new products and services that include opportunities in credit cards, consumer finance and wealth management on there tail side, and in fee-based income and investment banking on the wholesale banking side. Given the demographic shifts resulting from changes in age profile and house hold income, consumers will increasingly demand enhanced institutional capabilities and service levels from banks. With the growth in the Indian economy expected to be strong for quite some timeespecially in its services sector-the demand for banking services, especially retail banking, mortgages and investment services are expected to be on rise.

Reserve Bank of India (RBI) has approved a proposal from the government to amend the Banking Regulation Act to permit banks to trade in commodities and commodity derivative


Websites:www.google.com www.sarswat.co.in www.moneycontrol.com