COMPANY PROFLEMoneylenders have been part of Indian society since ancient

times. Modern banking in India begansome 200 years ago. First Bank in India was
established under the name and style of bank ofCalcutta in 1806(a presidency
Bank).In 1840 Bombay presidency Bank and in 1843 Madraspresidency Bank came
into existence. In 1921, these three presidency Banks were merged asimperial Bank
of India. In 1955, imperial Bank was renamed as State Bank of India.Aimed this
scenario, entire banking in the State of Jammu and Kashmir was performed
bytraditional moneylenders and that too at exorbitant interest rates. At the same
time some banks likePunjab National Bank, Grindalays Bank and imperial Bank of
India functioned in the State to alimited extent. The role of these banks was
reduced to the people of the State owing to thestatutory limitations. Under this
Scenario banks could not ameliorate the financial social positionof the people of the
State.To overcome this crisis, the then Maharaja of the State, His Highness Maharaja
Hari Singh,conceived the idea to establish a bank to help people of the State to
come out of the economicbackwardness. The scheme of forming the bank was
formulated by an eminent banker sir SorabjiN.Pochkanwala, the then Managing
Director of Central Bank of India. The outcome of the effortsof Sir Sorabji resulted in
the establishment of the Jammu & Kashmir Bank Limited on October 1,1938.And the
Bank formally commenced its business on July 4, 1939.The bank opened its first
24. branch at Residency Road, Srinagar. Encouraged by the support of public, it
opened its anotherbranch at Jammu. By 1946, the number of branches of the bank
went up to 12.Precisely, banking in the State of Jammu & Kashmir actually began in
1939, when Jammu &Kashmir Bank started its operation. Since then, with the
continuous changes taking place in thefinancial services scenario, the banking in
Jammu & Kashmir went under tremendous. Besidesexhibiting its commercial
character, the bank has been meeting the social obligation of the peopleof the State
too.The Jammu & Kashmir Bank is the first of its nature and composition as a State
owned bank in thecountry. The State government besides contributing half of the
issued capital also appointed thebank as bankers for general banking and treasury
business of the State government. In itsformative years, the bank had to coup up
several serious problems, particularly around the time ofindependence, when two of
its branches at Muzaffarabad and Mirpur fell to the other side in1947.However, the
State government came with assistance of Rs 6.00 lacto meet the claims.Following
the extension of Central laws to the State of Jammu & Kashmir, the Bank was
definedas a government companies Act 1956.The real growth of its operations and
business started after 1969, the area of nationalization ofmajor banks, when the
union government announced control on banking. It began to emerge fromits
regional shell, opening branches beyond the State boundaries and emerged as a
leading bank. In
25. 1971, the bank was included in the second schedule of the RBI Act 1934.It had
its first full timechairman following social control measures in banks in the country.
Five years later (in 1976) itwas declared an A Class bank. By the end of 1980, its
branches numbered 212 with aggregatedeposits of Rs. 191.67 corer and advance of
Rs. 61.67crores.The bank became pioneer in the finance of road transport,
horticulture and hostels to promotetourism and extended finance to the artisans to
promote traditional handicrafts. In fact the bankwas the first commercial Indian
bank to introduce schemes for financing fruit crops on standingtrees in the State of
Jammu & Kashmir, a policy that was subsequently emulated by other
bankselsewhere in the country.The bank expanded its area of operation and
widened its credit base by financing schemes likeintegrated Rural Development
Programmers (IRDP), SEEDY, PMRY, NRY and other self-employed programmers
sponsored by the State and Central Governments. In 1976, Bank becamethe first
and the only bank, which was permitted by the Reserve Bank of India to sponsor
tworegional banks, namely, Kamraz Rural Bank and Jammu Rural bank. The bank
has also beenentrusted with lead bank responsibility in eight of the fourteen
districts and governorship of theState Level Bankers committee in J&K State.The
bank has played a key role in the economic development of the State in particular
and thecountry in general. In the last ten turbulent years, it was the only
commercial bank to sustaineconomic and business activity as most of the
nationalized banks in the State downed their
26. shutters. During this difficult period, it was the J&K Bank alone that supported
various aimed atalleviating poverty and generating self-employment
opportunities.With a substantial increase in its capital base, the bank is participating
more extensively infinancing of infrastructure projects. A number of leading
corporate and blue chip companies aswell as prominent public sector undertakings
of the Indian government have become part of itsclientele. The financial of the bank
are very strong. The banks debt instruments have been highlyrated by CRISIL
(Credit Rating Information Service of India Limited), which has reaffirmed
itsP1+rating of the banks certificate of deposits, including strong degree of safety
with regards totimely payments. The bank is governed by the companies act and
banking regulation act of India.It is regulated by the Reserve Bank of India and
Security and Exchange Board Of India (SEBI).Atthe end of May 2006,the bank had
517 branches spread from Kashmir to Kanyakumari with 98%ofits business
computerized. The bank has been playing a vital role in the development of
theeconomy of the state and bolstering industry, trade, commerce and agriculture
in the state. Thebank has put a commendable performance in all aspects of banking
.The performance of J&KBank, its growth, profitability, diversification of product
portfolio, modernization of its operationsand its achievements in other areas have
made it one of top most banks of the country.Sri Sohan Lal Kothari was the first
manager of the bank and the then chief Minister major generalRoy Bahadur Dewan
Bishan Das was appointed as the foundation stone of the Residency roadSrinagar
branch building. Since 1977 the bank has been responsible for payment of civil
pensionand receipt of various states taxes. Findings overall performances of the
bank good, the RBI issueda license to the J&K Bank to deal in all types of foreign
exchange presence in 1980. The bank
27. installed first ATM in valley connected globally to all master card networks ATMs.
All thebranches of the bank are connected through V-SAT.On 10-08-2001 the bank
took over the Srinagar branch of standard chattered Grindlays bank. Thebank
inaugurated its new corporate headquarter building at M.A road Srinagar-on
2september2001.J&K Bank is today one of the fastest growing bank of India with a
network of 517 branches officesspread across the country offering world class
banking products and service to its customers.Today the bank has the status of
value driven organization and is always working towards buildingtrust with
shareholders, employees, customers, borrowers etc. for which it has adopted
strategydirected to developing a sound foundation of relationship and trust aimed
at achieving excellencewhich of course comes from the womb of good corporate
governance.The J&K Bank has recorded an outstanding achievement in the key
areas of operations. The totaldeposits as on 3103-2006 were Rs 23484.64 crores
against Rs21644.97 crores for the fiscal year2004-2005.Thus deposits have shown a
growth of 8.50%.The reserves and surplus of the bank grove by8.28% from Rs
1616.9 cr. of the previous year to Rs 1750.9cr.on ending March 2006.otherborrowing
of the bank decreased from Rs 319.48 cr. To Rs 263.9 cr. other liabilities for the
fiscalyear 2005-2006 ending 31 March stood at Rs 900.9cr. against Rs 792.9 cr. for
the previous year.
28. The Bank has made the total investment of Rs 900.34 cr. on 31 March 2006 the
advances haveincreased from Rs 11517.14 cr. as on 31 March 2005 to Rs 14483.10
cr. as on 31 March 2006showing a growth of 25.75% over the previous year.The
balance sheet has grown up to Rs 26449 cr. as on 31-03-2206 against Rs 24422 cr.
as on 31-03-2005 recording an increase of 8.29%.The fixed assets of the bank
amount for Rs 194.7 cr. andother assets are worth Rs 481.4 cr. The J&K Bank has
the total cash and balance with RBI Rs937.88 cr. and balance with banks and money
at C&S notice is Rs 1349.cr as on 31-03-2006.In the state of Jammu and Kashmir,
the J&K Bank has been the major contributor in providingcredit to poor artisans,
retailers, small business, agriculture and other allied activities, small scaleindustries
and technically qualified entrepreneurs. In these sectors with Rs 137.89 cr. in
agriculturesector, Rs 145.38cr.in industries sector and Rs 241.09 cr. in service
sector.J&K Bank having a strong network of 410 branches across the state has made
total advances of Rs5941.02 cr. in J&K State as on ending March 2006 as against its
total deposits of Rs 12236.98 cr.Thus achieving a current deposit ratio of
48.55%.Maintaining a progressive outlook, the J&K Bank is keeping pace with the
changing technology.The bank continues to leverage information technology as
strategic tool for its business operators.
29. The IT strategy emphasizes enhanced level of customer service through 24x7
hours availability,multi channel banking and cost efficient through optimal use of
electronic channels, wider marketreach and opportunities for cross selling.Currently
more than 90.5% of the banks business is computerized. The J&K Bank is the first
bankto launch ATM cum debit card in Kashmir. The bank launched ATM cum Debit
card J&K Bankglobal access card in collaboration with the master card
international. The bank has grown thenumber of ATMs to 182 at the end of March
2006.The bank has launched the three variant types of credit cards with different
limits with an interestfree credit facility for 20 to 50 days at accept at 125000
mercantile establishments across the globe.The customers have the access to their
money for all the 365 days of a year and 24 hours per day.The credit and debit
cards of the bank are accept of cash with draws at 7000 ATMs in India and 1million
ATMs across the globe. To maximize value to its customers, the innovation in
productsand improving the quality and speed of the services in the Hall Mark of
banks business strategy.The bank has launched several unique financial and deposit
products like education loans, carloans, consumer loans, flexi deposit recurring plus
and Mehandi deposits schemes to meet theneeds of customers. the bank has
recently won the prestigious Asian banking awards 2004 forcustomer convenience
programmmes. The award is given each to recognize and honor the bank inAsia
pacific region for outstanding innovating and world-class products services, projects
andprogrammers.
30. J&K Bank has embarked on brand strategy exercise and engaged removed
consultants to work onbusiness development possibility and engaged over all
processes that could be improved in thefuture to enhance the overall profitability of
the bank.This would increase branding of the banks products in order to increase
the value for its customers.And now with the right kind of leadership efforts of
dedicated employees and State of arttechnology, the J&K Bank is on the path of
growth and success building trust profit, peace andproperty.
31. BANK AT A GLANCEProfile:- Incorporated in 1938 as a limited liability company.
Governed by companies Act and Banking regulation Act of India. Regulated by the
Reserve bank of India and SEBI. Listed on National Stock Exchange (NSE) and
Bombay Stock exchange (BSE). 53 per cent owned by the Govt. of J&K. Rated
p1+by standard and poor-CRISIL connecting highest degree of safety. Four
decades of uninterrupted profitability and dividends.
32. Share Holding pattern (as on 03-09-2005)S.NO Particulars as on 30-09-2005
Percentage of share holding 1 Govt.of Jammu & Kashmir 53.17 2 Foreign
institutional investors 27.79 3 Resident individual 14.32 4 Indian Mutual Funds 1.71
5 Insurance companies 1.27 6 Bodies corporate 1.26 7 Non resident Indians 0.40 8
Banks 0.03 9 Transit/clearing members 0.03 10 Trusts 0.02
33. Unique characteristics: one of a kind Private sector Bank despite Government
holding 53% of equity. Sole bankers and lender of last resort to the Govt.of J&K. Plan
and non plan funds, taxes and non-taxes revenues, routed through the bank.
Salaries of Govt. officials disbursed by the bank. Only Private sector designed as
agent of RBI for banking business. Collect taxes pertaining to Central Board of Direct
Taxes in J&K.Infrastructure. Global Standards The fastest growing Bank with 510
branches across the country. Over 98 per cent of the business computerized.
Banking, Tele-banking and SWIFT facilities available. Internet Banking, SMS and
Mobile Bank provided. ATMs connected globally to all Master card Networked ATMs.
Mobile ATM Service available-first of its kind in Northern India. J&K bank Global
Access Debit card cirrus and Maestro enabled own Credit card. Live on RTGS System
of RBI.
34. Financial Services Portfolio: One stop for all financial needs. Insurance joint
venture with MetLife international. Distributor of : Life Insurance products of
MetLife (India) Pvt. Ltd. Non-life insurance products of Bajaj Allianz General
Insurance Co. Ltd Providing depository Services. Offering Stocks Barking Service.
Collection Agent for utility Services provided by State and private sector.New
Business Initiatives: Shaping ourselves to serve better.To meet the growing needs of
the economy, in tune with the competitive banking innovativefinancial products.
Monetizing the Banks branch network. Third party products distribution.
Investment Banking. Offshore Banking..
35. Demand DepositsSaving Account Min. Initial Deposit: Rs50/-in non-computerized
branches. Rs500/-in computerized branches. Min. Balance requirements: Rs50/-in
non-computerized branches Rs500/-in computerized branches. Anywhere Banking
Facility: Available at all computerized branches. Debit Card: Maestro & Cirrus
enabled Debit Card which can be used on Master Enabled ATMs & POS machines
both within & outside the country. Minimum balance requirements for debit card:
Rs1000/- Debit Card Charges :Issuing charge:Rs50/-,Usage Charges-Rs50/- Charged
half-yearly. Standing Instruction: Rs15/instruction at computerized branches.
36. Rs10/-in non-computerized branches. Penalty: Computerized Branches:Rs1/-per
day for the period the balance remains below Rs 200/- in accounts without cheques
book Rs 1/-per day(min 5)for the period balance remains, Below Rs1000/-with a
minimum of Rs 5/-for accounts with Cheque book facility. Non-computerized
Branches:Rs 0.25/-per day for the period the balance remains below Rs 50/-in case
of SB account without Cheque book facility Rs 0.50/-per day for the period balance
remains below Rs500/-for account with cheque.Current Account. Min.intial Deposit &
Min Balance Required: Computerized branches Rural Branches Rs 1000. Semi-urban
branches Rs2000/- Urban Branches Rs3000/- Metropolitan branches Rs5000/-
37. Non-Computerized Branches Rural Branches Rs 500. Semi-urban branches
Rs1000/- Urban Branches Rs1500/- Metropolitan branches Rs2500/- Anywhere
Banking Facility: Available at all computerized branches. No incidental charges
where average minimum balance is above Rs-1.00 lac.Avg. minimum balance
chargesRs 75.000 to below Rs 1, 00,000. Rs 750/-per quarter.Rs 50.000 to below Rs
75,000. Rs 1,000/-per quarterRs 25.000 to below Rs 50,000. Rs 1250/-per
quarterBelow Rs 25.000. Rs 1500/-per quarter Debit Card: Master & Cirrus enabled
debit card which can be used on Master Enabled ATMs & POS machines both within
& outside the country.
38. Minimum balance requirements for debit card: Rural Branches Rs 1000. Semi-
urban branches Rs2000/- Urban Branches Rs3000/- Metropolitan branches Rs5000/-
Debit Card Charges: Issuing charges-Rs 50/- Usage Charges-Rs 50/-charged half-
yearly. Standing Instructions: Rs 15/instruction at computerized branches. Rs 10 at
non-computerized branches.
39. Free Remittances: Avg. Monthly balance/month Aggregate value of
Remittances/month all as per Rs 1.00 lack to below 2.00 lack Rs 3.00 Lac Rs 2.00
lack to below 3.00 lack Rs 5.00 Lac Rs 3.00 lack to below 4.00 lack Rs 8.00 Lac Rs
4.00 lack to below 5.00 lack Rs 10.00 Lac Above 5 Lac Free up to Rs 10 lacks & 50%
Concession above Rs 10 lacs Penalty:Computerized Branches: Rs 1/-per day is
charged for the period the balance remains belowthe prescribed limits.Non-
Computerized Branches: Rs 2/-per day is charged for the period the balance
remainsbelow the prescribed limits.
40. Term Deposits Single initial-deposit based term products.Fixed Deposit Target:
Retail LIG short term investors. Minimum Deposit: Rs 100/-and above in multiple of
Rs 1/- Maturity: 7 days to 10 years. Interest Rate: Fixed. Interest Calculation: Simple
Interest. Interest payouts: Quarterly/on maturity Add-ons: Loan facility up to 90% of
amount, deposited plus interest accrued Penalty: 0.5% penalty up to Rs 5.00 Lacs
premature withdrawal 0.50% penalty above Rs 5.00 Lacs premature withdrawal.
41. Variants of Fixed DepositSuper Earner Deposit Target: Retail MIG short term
investors. Minimum Deposit: Rs 10001/-and above in multiple of Rs 100/- Maturity:
1year to 10 years. Interest Rate: Floating Interest Calculation: Simple Interest.
Interest payouts: Quarterly/On maturity Add-ons: Loan facility up to 90% of amount,
deposited plus interest accrued. Penalty: 0.25% penalty up to Rs 5.00 Lacs
premature withdrawal 0.50% penalty above Rs 5.00 Lacs premature withdrawal.
42. Cash Certificates Target: Retail LIG short term investors. Minimum Deposit: Rs
100/-and above in multiple of Rs 100/- Maturity: 6 months to 10 years Interest
Calculation: Quarterly Compounding basis. Interest payouts: On maturity. Add-ons:
Loan facility up to 90% of amount, deposited plus interest accrued. Penalty: 0.25%
penalty up to Rs 5.00 Lacs premature withdrawal. 0.50% penalty above Rs 5.00
Lacs premature withdrawal.Variants of Cash CertificateMillennium Deposit Target:
Retail MIG/HIG long term investors seeking returns as well as liquidity. Minimum
Deposit: Rs 1000/-and above in multiple of Rs 500/- Maturity: 6 months to 10 years
43. Interest Calculation: Quarterly Compounding basis. Interest payouts: On
maturity. Add-ons: The deposit is kept in units of Rs 500/- Any number of units can
be withdrawn anytime provided the total deposit balance does not fall below Rs
1000/- Penalty: Only on the premature withdrawal of the entire deposited
amount.Flexi-Deposit Target: Retail LIG long term investors seeking easy access to
credit. Minimum Deposit: Rs 1000/-and above in multiple of Rs 100/- Maturity: 6
months to 10 years. Interest Calculation: Quarterly Compounding basis. Interest
payouts: On maturity. Add-ons: Loan facility up to 90% of amount deposited plus
interest accrued. No separate requisition, no execution of loan documents and no
surrendering of the original Flexi Deposit Receipt. Penalty: 0.25% penalty up to Rs
5.00 Lacs premature withdrawal. 0.50% penalty above Rs 5.00 Lacs premature
withdrawal. Maturity: 7,10,12 and 15 years. Interest Calculation: Quarterly
Compounding basis.
44. Mehandi Deposit Target: Parents/Guarding of Girl child. However, the scheme
can be availed for male child also. Minimum Deposits: Depends upon the maturity
tenor and Maturity slabs. Interest payouts: On maturity Add-ons: Accidental
Insurance Cover Penalty: 0.25% penalty up to Rs 5.00 Lacs premature withdrawal.
0.50% penalty above Rs 5.00 Lacs premature withdrawal.Super Reinvestment
Deposit Target: Retail MIG long term investors seeking high returns. Minimum
Deposit: Rs 1000/-and above in multiple of Rs 100/- Maturity: 1years to 10 years
Interest rate: Floating Interest Calculation: Quarterly Compounding basis. Interest
payouts: Quarterly/On maturity. Add-ons: Loan facility up to 90% of amount
deposited plus interest accrued. Penalty: 0.25% penalty up to Rs 5.00 Lacs
premature withdrawal. 0.50% penalty above Rs 5.00 Lacs premature withdrawal.
45. Monthly Yield Deposit Target: Retail MIG long term investors seeking regular
monthly returns. Minimum Deposit: Rs 1000/-and its multiples. Maturity: 1years to
10 years. Interest rate: Fixed. Interest Calculation: Monthly Interest payouts:
Quarterly/On maturity. Add-ons: Loan facility up to 90% of amount deposited plus
interest accrued. Penalty: 0.25% penalty up to Rs 5.00 Lacks premature withdrawal.
0.50% penalty above Rs 5.00 Lacks premature withdrawal.
46. Term Deposits Monthly Deposit based term products.Recurring Deposit Target:
Retail LIG investors having desiring regular monthly investments. Minimum Deposit:
Rs 50/-and its multiples of Rs 5/- Maturity: 1years to 10 years Interest rate: Fixed
Interest Calculation: Quarterly Compounding basis Interest payouts: at maturity.
Add-ons: Loan facility up to 90% of amount deposited plus interest accrued. Penalty:
0.25% penalty up to Rs 5.00 Lacs premature withdrawal 0.50% penalty above Rs
5.00 Lacs premature withdrawal
47. Recurring plus Deposit Target: Retail LIG investors having with irregular
investible income. Minimum Deposit: Rs 100/-and its multiples thereof with no upper
limit. Maturity: 6 months to 10 years Interest rate: Fixed Interest Calculation:
Quarterly Compounding interest. Interest payouts: at maturity. Add-ons: Loan facility
up to 90% of amount deposited plus interest accrued. Penalty: 0.25% penalty up to
Rs 5.00 Lacs premature withdrawal 0.50% penalty above Rs 5.00 Lacs premature
withdrawalChildcare Deposit Scheme Target: Parents/Guardians investing long term
with regular monthly savings for their child. Minimum Deposit: Rs 100/-and
multiples thereof Maturity: 7,9 and 10 years as recurring plus 5,7 and 10 years
respectively as term deposit
48. Interest Calculation: Quarterly Compounding basis Interest payouts: On
maturity. Add-ons: Accidental insurance cover linked to the size of monthly deposit
amount. Penalty: 0.25% penalty up to Rs 5.00 Lacks premature withdrawal 0.50%
penalty above Rs 5.00 Lacks premature withdrawalDeposit Pension Scheme Target:
Person who do not enjoy pension benefits either from their present employees or
their parent business. Minimum Deposit: Rs 50/-and multiples, thereof Maturity:
84,105 or 111 months. Payment Pattern: Monthly payouts from 86th ,101 th and
113th months respective to the maturity tenors. Interest Calculation: Quarterly
Compounding basis for the first term Simple interest on 2nd term. Interest payouts:
Regular monthly payouts starting from commencement of 2nd term .Full amount
paid at the end of second term. Penalty:0.25% penalty up to Rs 5.00 Lacks
premature withdrawal.
49. SB UJALA Saving Deposit SchemeIn compliance to the direction of direction of
Reserve Bank of India to have a basic banking No-frills account to ensure financial
inclusion of vast sections of population and also to strive formaking our service
liberally and easily accessible to all segments of society including the deprivedand
underprivileged ones, our Bank is introducing a new variant of Saving Bank account
underthe name of SB UJALA Account The main features of the scheme are:
Eligibity: The scheme shall be open to all people who are eligible to open Savings
Bank account with our Bank in ordinary course. Minimum Initial Deposit: The
account can be opened with a minimum initial cash deposit of Rs 50/-.However,
customer may also be allowed to open the account with banking instruments like
Bankers cheques, etc. without being insisted upon to deposit the minimum
prescribed amount in cash for opening the account. Minimum Balance: The
minimum balance to be maintained for keeping the account operational shall be Rs
50/- Permissible withdrawals per month: The number of permissible withdrawals per
half year shall be 24,with a maximum of 4 withdrawals per month. Cheque-Book
facility: No Cheque book facility shall be ordinary provided on this account.However,
Cheque-book may be issued to the account holders in case the average quarterly
balancefor past 6 months is maintained at Rs 1000/- and above .All
Branches/Extensions Counters are advised to transfer all those existing Saving Bank
accountshaving average balance of Rs 50/-and above but less than the minimum
balance prescribed
50. otherwise for Saving Bank Account having average balance of Saving Bank
Account to thisnewly created separately portfolio, namely SB UJALA Saving
Deposit Account. Entiresegregation should be completed before ensuring year
ending, i.e, 31.03.2006.Information aboutthe number of accounts opened under this
scheme may be submitted to this office on quarterlybasis for onwards submission to
Reserve Bank of India. Branches are advised to popularize thisscheme by creating
adequate awareness among the masses in their respective service areas with
theobjective of financial inclusion of maximum number of people.