Topic – 1

Bank Merger – Boon or Bane

A merger involves the total absorption of a target firm by acquiring. As a result one firm ceases to
exist and only the new firm (acquiring) remains.

Merger gives more benefits to the acquiring bank particularly reduction of Fixed and Variable costs
and it avoids the wastages of expenditure to a large extent.

But one important factor to be keep it mind by the acquiring bank in merging process
i.e., Strengthen the Organizational Structure i.e., Centralization and Decentralization of operational
areas, span of control of the Bank. Undoubtedly merger gives number of advantages to acquiring
bank, at the same time Controlling is very difficult due increase in size of the Organization, Business
Operations and Volumes. To overcome this problem, from day one of merging processes, the
acquiring bank should think about the Control aspects for each and every function i.e., how
effectively and efficiently the acquiring bank control Bank Branch located in nook and corner of the
country. The objective of merger will be defeated, if control systems are not well established
properly by the acquiringr bank. Due to availability of latest Information Technology in the country,
controlling Branches located in villages from the Head Office is not a big problem by the acquiring
Bank.

Pros / Boon / Advantages :

 Increase in Competition
 Decrease in Product Price and thereby decrease in Spreads
 Rationalization of Branches / Regional / Zonal Offices – Geographical Penetration
 Controlling the Real Estate Costs
 Manpower Adjustments – Talent & Team Upgrade
 Lessen Recruitment Costs
 Minimization of Overheads Costs
 Control on wastage of Advertisement Expenses
 Large Scale Economies
 Decrease in Overheads
 Decrease in Cash Replenishment Costs of ATMs
 Decrease in maintenance costs of Alternate delivery channels including Call Centres.
 Decrease in Advertisement, Selling and Distribution Expenses.
 Decrease in Information Technology Costs to a large extent.
 Decrease in commission payable to business sourcing agencies.
 Decrease in Rental Costs due merging of Big Branches and CPCs
 Decrease in Stationery, Printing Expenses
 Better Asset Liabilities Management
 Implementation of Basel III accord
 Technology up-gradation
 Controlling Market, Credit and Operational Risks
 Easy to supervise by the Regulator and Government of India
 Better Customer Service

Cons / Bane / Disadvantages :

 Poor Culture Fit
 Poor Commitment
 Customer Impact And Perception – Regional Affinity with Customer
 Compliance And Risk Consistency
  Merger sees the stronger banks coming under pressure because of the weaker banks
 Merger could only give a temporary relief but not real remedies to problems like bad loans
and bad governance in public sector banks
 Larger banks might be more vulnerable to global economic crises while the smaller ones can
survive

Topic – 2

Indian Banking System – Challenges / Opportunities

The Indian banking system consists of 27 public sector banks, 21 private sector banks, 49 foreign
banks, 56 regional rural banks, 1,562 urban cooperative banks and 94,384 rural cooperative banks,
in addition to cooperative credit institutions. It is very dynamic now-a-days.
As per the Reserve Bank of India (RBI), India’s banking sector is sufficiently capitalised and well-
regulated. The financial and economic conditions in the country are far superior to any other country
in the world. Credit, market and liquidity risk studies suggest that Indian banks are generally
resilient and have withstood the global downturn well.

Indian banking industry has recently witnessed the roll out of innovative banking models like
payments and small finance banks. RBI’s new measures may go a long way in helping the
restructuring of the domestic banking industry.

Opportunities
 A growing economy
 Banking deregulation
 Increased client borrowing
 An increase in the number of banks / branches
 An increase in the money supply
 Low government-set credit rates

General Challenges
 Market Discipline & Transparency
 Human Resources Management
 Financial Inclusion
 Employee Retention
 Customer Retention
 Intense Competition
 Privacy & Safety
 Environmental & Economical Issues
 Social & Ethical Issues.

Other Emerging Challenges

 Asset quality is under tremendous pressure due to continued economic slowdown and
increase in the rise of the levels of Gross nonperforming advances and NPA’s.
 One of the major problems is Large Over dues of farmers in small branches of rural
areas. And Government decision to waive to all farmers loans has added in the difficulties
of such banks.
 Indian banks are facing bad loans or Non-performing assets (NPA), which means loans
which are not paid by the borrowers on time, and hence causing huge burden on banks.
 Even after all the efforts made by the government, banks at rural areas are still in loss
as rural people are still not familiar with banking system.
 There is also risk from political interference as the government can interfere with banking
policies at the time of budget implementation.
 One of the emerging threats is Cyber threats as the most of the transaction are made
through digital channels, which are not 100% secure.
 Many senior bank workers are still not familiar with the use of technologies in bank and
young and inexperienced are replacing them.

Steps taken by Indian banking sector:-

 All banks are wholeheartedly working for the complete implementation of PMJDY
(Pradhan Mantri Jan DhanYojna) making banking service available to everyone.
 For farmers, Kisan Credit Card scheme is launched to help them with Loans through
banks.
  Protection of bank customers’ information has one of the trust areas for RBI. And for this
RBI has issued a charter of customer rights on the global best practices.
 With the implementation of KYC/AML norms banks are now able to remove all the fake
accounts and with this monitoring of transactions is easy.
 To make payment easier, accessible and secure, banks and Government together
launched AEPS (Adhaar enabled payment system).
 Banks are getting digitized means converting data into digital format, thus providing better
services to customers.
 Banks are taking steps to reduce NPA and to strengthen the balance sheets and also
working hard to strengthen NPA’s recovery rules.

Topic – 3
Back Office Concept – Good or Bad
Examples – SMS / CPC / SMELF / RBO / RBO…

Advantages
 Makes Banking Business Efficient and Streamlined
 Skilled staff can concentrate more on the core elements and functions of the day-to-day
business
 Utilize human resources / other resources systematically for optimum growth and
productivity.
 Increase in productivity, revenue and efficiency
  Access to Professional, Expert and High‐quality Services
 Overall Cost Advantage
 Saves time and money
 One can concentrate on branch functions well and thereby develops the vital relationships
with customers and clients
 Business runs consistently as it takes care of the operations and keeps a track of the
processes.
 Optimize the resources and generating wealth

Dis-Advantages
 Lack of Customer Focus
 A Threat to Security and Confidentiality
 Dissatisfactory Services
 Ethical Issues
 Other Disadvantages: Include misunderstanding of the contract, lack of communication, poor
quality and delayed services.

Topic – 4

IBC - An Effective Tool in NPA recovery

IBC' 2016, is the Bankruptcy Law of India, which seeks to consolidate the existing
framework by creating a single law for Insolvency & Bankruptcy

INSOLVENCY is a state, when an individual or organisation is unable to meet its outstanding

financial debt towards its lender as it become due.

BANKRUPTCY is a concept slightly different from Insolvency. A Bankruptcy is, when a person
voluntarily declares him as an insolvent and goes to the court.
CODE is usually known as the collection or compendium of laws. It refers to the systematic and
comprehensive compilation of laws, rules or regulations, what are consolidated and classified
according to a particular subject matter.

IBC is applicable to Individuals, Partnerships, LLPs and Corporates

The Institutional Infrastructure under IBC'2016, rests on Four Pillars, viz....

 Insolvency Professionals
 Information Utilities
 Adjucating Authorities
 Insolvency and Bankruptcy Board of India

INSOLVENCY PROFESSIONALS assist in the completion of Insolvency Resolution, Liquidation and

Bankruptcy proceedings and are goverened by Insolvency Professional Agency.

The Information Utilities would collect, collate, authenticate and disseminate Financial Information.
They maintain electronic databases on lenders and terms of lending.

The Adjudicating Authorities under the code are National Company Law Tribunal (NCLT)
and Debt Recovery Tribunal (DRT)
 DRT - Individuals / Partnerships
 NCLT - Corporates / Companies / LLP

The Insolvency and Bankruptcy Board of India (IBBI) - is the body which has regulatory oversight
over Insolvency Professionals, Insolvency Professional Agencies and Information
Utilities.

Corporate Insolvency Resolution Process

 10 Days – Notice
 Apply to NCLT
 NCLT - appoints Interim Insolvency Professional within 14 days
 Interim IP constitutes Creditors' Committee
 Creditos' Committee meet within - 7 days
 Confirm or Replace Interim IP by 75 % votes
 Insolvency Resolution decision - 75 % vote
 CIRP to be completed within 180 days
 If case complex – 90 days extension allowed
 Resolution Professional conducts CIRP
 RP prepares Information Memorandum
 Resolution plan - submitted before COC for approval.
  Decision on Restructuring process viz..Revised Repayment Plan or Liquidation of Asset
 The Resolution plan will be sent to NCLT for final approval and implemented once approved.

Insolvency & Bankruptcy code 2016 (IBC):

The code is the bankruptcy law of India which seeks to combine the existing framework by creating
a single law for insolvency and bankruptcy.

It recommends two separate tribunals to supervise the insolvency process– the National Company
Law Tribunal (NCLT) for companies and limited liability partnership for firms, while the Debt
Recovery Tribunal for individuals and partnership.

Time period for completion of case has maximum limit of 180 days and can be extended further by
90 days. Both debtor or creditor can opt for this code

IBC : Effective Tool in NPA Recovery

The new bankruptcy code overhauls the current highly-fragmented insolvency resolution regime
and provides a unified framework. It empowers all classes of creditors to trigger the legal process in
case of non-payment of a valid claim. It provides a reasonable time-frame to all stakeholders to
arrive at a common resolution plan. In the absence of it, it provides for the appointment of a
‘resolution professional’ that invites resolution plans on the basis of an information memorandum
prepared by him.

The resolution plan is required to be approved by a creditor committee with 75 per cent majority, by
value, and also provides for compulsory liquidation if a resolution plan is not approved within 180
days, extendable to 270 days. This law continues to evolve, with further changes being made to
either address implementation issues or bring in certain anti-abuse provisions. This is the major
legal weapon in the hands of the government for the speedy resolution of mounting corporate NPAs.
IBC tackles corporate defaulters, who were protected by the old regime wherein nothing could be
recovered. The new law emphasizes on saving businesses by bringing the existing promoters with
or without new partners or new entrepreneurs to come in and make the revival possible.

The government recently disallowed defaulting promoters from retaining control of their companies
once the resolution process is initiated. This is a major step so that the resolution process does not
help the existing sponsors retain control of their companies at the cost of lenders. Until they have
cleared their overdue payments, they will not become eligible to submit resolution plans. Initially,
there was sharp criticism of this drastic measure, by the corporate sector. This is a necessary move
to ensure that promoters did not walk away with the same asset at a heavy discount. A clause was,
however, inserted allowing the promoters to participate if they cleared the dues.
 Topic – 5
Prompt Corrective Action
The 11 state-run banks, which are under the RBI’s prompt corrective action (PCA) framework, have
seen a 400 basis points increase in their share of retail loans at 19% in the four years ending
September 2018.

[The 11 banks under the PCA are: Allahabad Bank, United Bank of India, Corporation Bank, IDBI
Bank, UCO Bank, Bank of India, Central Bank of India, Indian Overseas Bank, Oriental Bank of
Commerce, Dena Bank and Bank of Maharashtra. These banks together control over 20 per cent of
the credit market.]

Background: The RBI began to place state-run banks under the PCA framework for the first time in
September 2016, when their NPAs soared beyond the regulatory tolerance levels (10%) and CRAR
less than prescribed limit (9%).

What is PCA? PCA norms allow the regulator to place certain restrictions such as halting branch
expansion and stopping dividend payment. It can even cap a bank’s lending limit to one entity or
sector. Other corrective action that can be imposed on banks include special audit, restructuring
operations and activation of recovery plan. Banks’ promoters can be asked to bring in new
management, too. The RBI can also supersede the bank’s board, under PCA. The PCA is
applicable only to commercial banks and not extended to co-operative banks, NBFCs.

Trigger Points for PCA :

Net NPAs over 10% but less than 15% - special drive to reduce NPAs and contain generation of
fresh NPAs; review loan policy and take steps to strengthen credit appraisal skills, follow-up of
advances and suit-filed/decreed debts, put in place proper credit-risk management policies; reduce
loan concentration; restrictions in entering new lines of business, making dividend payments and
increasing its stake in subsidiaries
Net NPAs 15% and above – In addition to actions on hitting the above trigger point, bank’s Board is
called for discussion on corrective plan of action

CRAR less than 9%, but equal or more than 6% - bank to submit capital restoration plan;
restrictions on RWA expansion, entering into new lines of business, accessing/renewing costly
deposits and CDs, and making dividend payments; order recapitalisation; restrictions on borrowing
from inter-bank market, reduction of stake in subsidiaries, reducing its exposure to sensitive sectors
like capital market, real estate or investment in non-SLR securities, etc.

CRAR less than 6%, but equal or more than 3% - in addition to actions in hitting the first trigger
point, RBI could take steps to bring in new Management/ Board, appoint consultants for business/
organizational restructuring, take steps to change ownership, and also take steps to merge the bank
if it fails to submit recapitalization plan.

CRAR less than 3% - in addition to actions in hitting the first and second trigger points, more close
monitoring; steps to merge/amalgamate/liquidate the bank or impose moratorium on the bank if its
CRAR does not improve beyond 3% within one year or within such extended period as agreed to

ROA less than 0.25% - restrictions on accessing/renewing costly deposits and CDs, entering into
new lines of business, bank’s borrowings from inter-bank market, making dividend payments and
expanding its staff; steps to increase fee-based income; contain administrative expenses; special
drive to reduce NPAs and contain generation of fresh NPAs; and restrictions on incurring any capital
expenditure other than for technological upgradation and for some emergency situations.

Negative effects of PCA: Banks under the PCA have lost market share to private sector banks in
corporate loans and unsecured personal loans, and it will be a Herculean task for the affected
banks to claw this back. The PCA framework puts restrictions on weaker banks on many aspects,
including fresh lending and expansion, and salary hikes, among others.

When is PCA invoked? The PCA is invoked when certain risk thresholds are breached . There are
three risk thresholds which are based on certain levels of asset quality, profitability, capital and the
like. The third such threshold, which is maximum tolerance limit, sets net NPA at over 12% and
negative return on assets for four consecutive years.

What are the types of restrictions? There are two type of restrictions, mandatory and
discretionary. Restrictions on dividend, branch expansion, directors compensation, are mandatory
while discretionary restrictions could include curbs on lending and deposit. In the cases of two
banks where PCA was invoked after the revised guidelines were issued — IDBI Bank and UCO
Bank — only mandatory restrictions were imposed. Both the banks breached risk threshold

What will a bank do if PCA is triggered? Banks are not allowed to re new or access costly
deposits or take steps to increase their fee-based income. Banks will also have to launch a special
drive to reduce the stock of NPAs and contain generation of fresh NPAs. They will also not be
allowed to enter into new lines of business. RBI will also impose restrictions on the bank on
borrowings from interbank market.

Impact: Small and medium enterprises will have to bear the brunt due to this move by RBI. Since
the PCA framework restricts the amount of loans banks can extend, this will definitely put pressure
on credit being made available to companies especially the MSMEs. Large companies have access
to the corporate bond market so they may not be impacted immediately. It has been predicted that if
more state-owned banks are brought under PCA, it will impact the credit availability for the MSME
segment

Topic – 6
Impact of Social Media / Social Media Marketing on Banks
Social media Marketing, is a series of websites and applications designed to allow people to share
content quickly, efficiently and in real-time. Interaction, live chat, status apprises, image as well as
video sharing are few examples for popularity of social media Marketing. Role of Social Media
Marketing in Banking business cannot be under estimated. It is the change in Banking business.
Social media Marketing represents low-cost tools that are used to combine technology and social
interaction with the use of words. These tools are typically internet or mobile based.... Social media
marketing gives sellers a voice and a way to communicate with peers and potential consumers.

Social media marketing permits users to distribute messages to individuals based on highly specific
criteria, including geographic location, age, gender, career, education and interests-among another
significant user information. Such specificity increases the relevance of a given communication,
improving the effectiveness of a particular bank efforts. Further, through social media, banks are
able to match their marketing messages to younger audiences, higher income individuals, or even
people in certain life stages in a defined area enhancing message impact considerably. Online
networking can grow your range and fortify your advertising message by coordinating flawlessly
with other computerized and conventional strategies.

Positive Impact :
 Build Social Authority
 Pull and not Push Marketing
 Engaging with customers, employess, stakeholders
 Enhancing the brand by connecting with customers
 Distinguishing from competitors
 Cost cut marketing
 Boost innovation
 Increases revenue
 Exposes company values – easily and quickly
 Attracts specific kinds of customers
 Changeable and Real Time
 Cheap
 Easy Reachable

Negative Impact :
 Security Threat
 Even simple mistake – Reputation Risk
 Topic – 7
EASE
Banking Reforms Roadmap
The reform agenda, aimed at EASE – Enhanced Access and Service Excellence, is based on six
themes. Capital infusion is dependent on PSB performance on these reform themes.

Theme 1: Customer Responsiveness

 EASE for customer comfort through promotion of digital banking and progressively
making brick-andmortar branch visits redundant, simplification of forms, providing
onestop access of financial services to customers including banking-plus services
(insurance & investment), pleasing ambience with courteous staff and basic customer
amenities.
 EASE in Grievance redressal through enabling real-time complaint status tracking
by complainant with feedback from them to check the quality of redressal and
analyzing & taking effective action on common grievances to avoid recurrence.
 EASE for Senior citizens and differently abled through doorstep banking,
dedicated counters or giving preference in service, digitization and proactive services
to minimize the visits required.
 Annual EASE ranking index on customer EASE to measure bank’s customer
responsiveness and performance on all EASE items.

Theme 2: Responsible Banking

 Clean lending and prudent asset management – through creation of Stressed
Asset Management Vertical (SAMV) for focused recovery efforts of identified Stressed
Assets, tie-up with agencies for specialized monitoring (ASMs) for clean & effective
post-sanction follow-up, institute efficient practices for effective coordination in large
consortium loans, strict segregation of preand post-sanction roles & responsibilities,
differentiated banking strategy etc.

 Furthering financial stability – by checking aggressive and imprudent lending

through proactive, dynamic and systemic risk management, monetizing realizable
value from sale of noncore assets and rationalizing overseas operations.
 Improving governance for ensuring outcomes – It involves following a board-
approved strategic vision & business focus plan, evaluation of performance of Bank’s
Whole Time Directors by boards and strengthening & empowerment of boards.

Theme 3: Credit Off-take

 EASE for the borrower & pro-active delivery of credit- through online application
facility for loans, digitalizing non-retail credit appraisal process, development of
differentiated products and services for industry-based market segments.

Theme 4: PSBs as Udyami Mitra

 EASE of bill realization for MSMEs by registration of all banks on TReDS platform
for faster bill discounting
 EASE of financing for MSMEs through steps such as board-approved policy for
enhanced working capital to GST-registered MSMEs, enabling MSME financing
through cluster based financing & FinTech, time-bound and automated processing of
MSME loan proposals.
  Single-point MSME Relationship Officers for top-20 MSME accounts in every
MSME Specialized Branch
 Revival Framework for stressed MSMEs after identifying all SMA-1/2 MSME
accounts.

Theme 5: Deepening Financial Inclusion & Digitalization: micro-insurance, digitalization

 EASE through near-home banking by establishing banking outlets within 5 Kms of
every village, providing services through Bank Mitras for branchless banking and
mobile ATM in every under-served district.
 Social security through micro-insurance through massive expansion of coverage
under PM Suraksha Bima Yojana and PM Jeevan Jyoti Bima Yojana.
 LEASE through digital payments by issuing RuPay debit card to all Pradhan Mantri
Jan Dhan Yojana Accountholders, Aadhaar seeding all operative current & savings
account, massively expanding Aadhaar - enabled payment Points of Sale.
 Customer protection against cyber-frauds by taking steps such as ensuring refund
against unauthorized debit in electronic transaction within 10 working days of
notification by customer, real-time alerts for customer protection, free customer-level
security updates for apps & Internetbased utilities.

Theme 6: Ensuring outcomes: Governance/HR

 Developing personnel for Brand PSB by rewarding select top-performers identified
through a Performance Management System (PMS), specialisation through job
families, making mandatory annual role-based e-learning programme for all officers.

Topic – 8

Positive Impact of technology on Indian Banking Business

 The biggest revolution came in banks is Digitization.
  Banking process is faster than before and more reliable. Maintenance and retrieval of
documents and records have become much faster and easier.

 Computerized banking also improves the core banking system. With CBS (core banking
system) all branches have access to common centralized data and are interconnected.

 With the innovation of MICR cheque / CTS, the processing of cheques becomes more faster
and efficient h than before.

 Technology also leads to competition among the banks which eventually provides better
services to people.

 With introduction of mobile banking, one can access their bank from anywhere-anytime.
Everything is one quick tap away.

 To facilitate better services, Banks have introduced Automated Banking Services

Solution like Cash Deposit Machine, Cheque Deposit Machine, Passbook Printing Machine -
through these… service have become easier.

 It offered more transparency in transactions.

Negative Impact of technology on

Indian Banking Business
 The biggest negative impact of technology is loss of Jobs as automation has replaced
number of jobs in banking sector.

 Through technology comes the threat of Cyber Attack, a loophole in the system, millions of
data can be lost in the blink of an eye.

 These technologies consumes less time, it also sometimes makes people careless work
culture

Impact of technology on Indian Banking Business

Introduction : The banking industry has implemented information technology for improving
different areas like customer services and CRM, managing its operation, house-keeping,
monitoring and controlling, risk management, managing its human resource etc. The transformation
in banking services is providing various advantages to customers with anytime, anywhere access
to their accounts as well as power to operate their accounts.

 Automated Teller Machines

Cash withdrawals
Details of most recent balance of account
Mini statement
Statement ordering facility
Deposit facility
Payments to third parties.

 Remote Banking Services

Balance enquiry
Statement ordering
Funds transfer (payment) to third parties
Funds transfer between customer’s different accounts
 Order traveler’s cheques and other financial instruments.

 Internet Banking
 Mobile Banking
 ASBA
 Benefits - To the Individuals :
 Anytime / Anywhere Banking
 Online purchase
 Receive – relevant & detailed information in seconds
 To the Merchants, Traders etc. :
 Assured immediate settlement and payment to the various transactions made by the
traders.
 Avoid all the cost and risk problems involved in handling cash
 Other benefits include improved image, improved customer service, eliminating paper,
reduced waiting costs and increased flexibility.
 To the Banks
 E-banking provides competitive advantage with unlimited network to the banks.
 Online banking – an effectiveness medium of \promotion of various schemes of
the bank, and indeed acts as a marketing tool.
 By connecting ATM and PO terminals, risk of over-drawl of cash can be
eliminated in case of ATM credit and debit card
 To the Nation
 Globalization of trade can be achieved effectively though e-banking.
 E-banking promotes more exports so that the flow of foreign exchange increases.
 Conclusion : Although the change is good but still banks in India are required to address the
important issues to get the full benefits of information technology implementation.

Topic – 9

Compliance culture is hurdle or heart of banking business

Every Bank differs in their operation methodology, but one thing they have in common is a
Compliance Department. It is the Bank's Internal Police Force. It is the unit that ensures that a Bank
complies with applicable laws, regulations and rules. Compliance rules and laws generally cover
matters such as observing proper standards of market conduct, managing conflicts of interest,
treating customers fairly and ensuring the suitability of customer advice. Hence, it plays an essential
role in helping to preserve the Integrity and reputation of the bank.

Benefits / Heart of Banking Business

 Reduce Your Legal Risks
 Avoid Reputational Risk
 Avoid Future Costs
  Build Trust with Your Customer
 Engage with Your Employees

Compliance should be part of the culture of the organization. It is not just the responsibility of
specialist compliance staff and it should be in the blood of each and every staff members. Failure to
consider it, will impact on its shareholders, customers, employees and the markets, which may
result in significant adverse publicity and reputational damage, even if no law has been broken.

Topic – 10

How to increase the income of farmers by 2022

 The Prime Minister’s vision of doubling farmers income by 2022
 This not only improve the well being of our farmers but also trigger to boost agri-based
manufacturing growth in rural India.
 The focus must shift from increasing per acre productivity to gainfully employing farm
households in other farm-related activities.
 A sudden withdrawal of subsidies will hurt the farmers, but creating industrial units in rural
areas will create jobs
 Goat rearing
 Poultry
 Honey production
 Value addition to crops
 Bio-fuel
 Increase in productivity of crops
 Increase in production of livestock
 Improvement in efficiency of input use (cost saving)
 Increase in crop intensity
 Diversification towards high value crops
 Improved price realization by farmers
 Shift of cultivators to non-farm jobs
 Development initiatives including infrastructure
 Technology
 Policies
 Institutional mechanisms

Topic – 11

AI will shape banking in future

 Almost all banks offer similar products
 Banking become commoditization
 biggest differentiator for banks today is customer experience
 Customers are choosing a bank based on factors such as Customer Service, ease of
navigation and quality of issue resolution; rather than products / interest rate.
 customers have become more demanding than ever before
 They look for instant gratification, especially the millennials – they expect a high quality of
interaction and seek super quick resolution of any requests. As banking becomes more
digital, delivering the best experience online becomes a challenge.
 The answer to addressing these issues lies in Artificial Intelligence (AI). The banking industry
has already acknowledged the importance of AI in banking
 AI will revolutionize banking, both in terms of customer interaction and information gathering
in following ways…
 Faster and More Efficient Customer Service
 Enhancing customer experience – analyse customer behaviour
 Personalized Experience
 Operational Efficiency
 Targeted Marketing and New Revenue Streams
 Safety and Security
 Fraud Detection
 Improved business operations and risk management
 Topic – 12

Crypto currency/ Blockchain will shape banking in future

Blockchain Technology has spread very fast, and Crypto Currencies have received vast popularity.
There is no doubt that the world is curious to see how this promising technology will influence or
shape the future of banking.

The many interesting characteristics of Blockchain technology make it not only very attractive but
also capable of solving numerous banking issues.

Blockchains do not contain books, but digital assets — cryptocurrencies. Blockchain transactions are
immutable. Meaning, transactions are impossible to alter once they are signed in a block and all of
the nodes (computers) connected to the blockchain, continuously approve these transactions,
preventing fraudulent activity

 Blockchain enhances safety in data storage and transmutation

 Avails a decentralized and transparent network infrastructure
 Reduces the costs involved in operations
 Payment : Banks and financial institutions can implement Blockchain technology, in general,
to reduce costs and increase speed when making bank-to-bank and international transfers.
Independent financial analysts and large financial companies agree that blockchain
technology is very likely to replace the SWIFT bank transfer system in the near future
 Client identification system : Banks perform KYC (Know Your Client) before processing any
applications. With the use of blockchain, users will be identified on a single occasion, and the
information will be stored in a secure location where all banks in the system can access it.
 The security, ease of use, and accessible nature of blockchain technology are all quite mind-
blowing
 Topic – 13
Cyber Security Issues in Banks and
Strategies of banks for minimizing the risk
A cyber-attack is a deliberate exploitation of computer systems, technology-dependent enterprises
and networks. Hackers (cybercriminals) use malicious code and software to alter computer code,
logic, or data, resulting in disruptive consequences that can compromise data and lead to cyber-
crimes such as financial information, healthcare record, and identity theft or system infiltration.

As per the critical information infrastructure rules framed in 2013 under the Information Technology
Act, 2000, the banking, financial services and insurance (BFSI) sector is one of the most critical
domains that are prone to cyber-attacks.

Major Cyber Security Threats are…

 Unencrypted Data
 New automation technology without Security
 Unprotected Third Party Services
 Unsecured Mobile banking
 Ignoring a Potential Breach
 Money Laundering

Cyber Security – Issues - Solutions…

 Communication and Intelligence
 Scenario-based Testing
 Cross-industry Collaboration
 Implementing Blockchain Technology for Cyber Security
 Topic – 14

Financial Inclusion in India : Why Not Happened

Financial Inclusion is defined as “the process of ensuring access tofinancial services and timely and
adequate credit where needed by vulnerable groups such as weaker sections and low income
groups at an affordable cost” (Rangarajan, 2008) in the report of the Committee on financial
inclusion in India

Financial inclusion is a broad term used to describe the provision of savings and loan services to
the poor in an inexpensive and easy to use form. It includes opening of bank accounts for those that
have never had one, and allowing people to send and receive money easily. The main objective is
ensuring access to formal credit for people who depend on informal means for their financial needs
and also financial education to ensure that the poor and marginalised make the best use of their
money.

Problems / Reasons for not happening :

There are a number of reasons for exclusion. In remote, hilly and sparsely populated areas with
poor infrastructure, physical access hinders inclusion efforts. From the demand side, lack of
awareness, low incomes/assets, social exclusion, and illiteracy mainly stand as barriers. Among the
supply side factors distance from branch, branch timings, complicated documentation and
procedures, unsuitable products, language, staff attitudes are common reasons for exclusion.

 Distance continues to be a major issue, though BCs have started to provide succor in certain
regions.
 Navigating the Procedures remains a challenge; Lack of knowledge (institutional as well as
user level);
 Insufficient infrastructure leading to long hours of waiting,
 if banks are accessible; Lack of customized products and services.
 In contrast informal and quasi-legal entities win on this count.
 Human resources of formal financial institutions unequipped to deal with challenges of FI.
Solutions for not happening :
 Branch Expansion in Rural Areas
 Business Correspondent/ Business Facilitator Model
 Relaxed KYC norms
 Use of Technology
 Direct Benefit Transfer
 Innovative product lines & processes
 Policy Framework
 Topic – 15
Zero Tolerance Area of our Bank

Sr. Parameter
Non compliance of KYC norms in newly opened
1
accounts
Non compliance of guidelines in handling of PINs
2
and Debit Cards
3 Status of signature scanning
4 All security forms to be entered in Finacle
Generation, checking and filing of Exceptional
5
Transaction Reports.
Generation, checking and filing of Inter SOL
6
Transaction Reports.
Generation, checking and filing of OFFSOL Txn
7
Report
8 PSR submission by the branch
9 Display of BCSBI code in the branch premises
Generation of CIBIL / EQUIFAX report before any
10
advance’s sanction
11 Registration of all mortgages through CERSAI
Availability of Ultra Violet Ray machine.
12 The same is in working condition
It is being used as per extant guidelines
Generation, Checking and
13 Signing of Change of Mobile
Number Report from BOBMENU
Adherence to Four Eye Principle
14 InFinacle Transaction
In Advance Accounts
Attending and Rectifications of CEMU Alerts by
15
the branches

Topic – 16
 Core Values & Its Importance
The Core Values attempts to set forth the guiding principles on which the Bank shall operate and
conduct its daily business with its multitudinous stakeholders, government and regulatory agencies,
media, and anyone else with whom it is connected. It recognises that-the Bank is a trustee and
custodian of public money and in order to fulfil its fiduciary obligations and responsibilities, it has to
maintain and continue to enjoy the trust and confidence of public at large.

Our Core Values :

Integrity – We are ethical and transparent in our words, actions, and dealings with all stakeholders

Courage – We are resilient in the face of adversity and having faith in our beliefs

Excellence – We strive for continous improvement in our policies, systems and processes

Passionate Ownership – We display energy, enthusiasm, and commitment towards our bank and
we work together for the bank

Innovation – We create value through new ideas

Customer Centricity – Our customer interests lie at the core of all our actions

Importance
 Many companies focus mostly on the technical competencies but often forget what are the
underlying competencies that make their companies run smoothly — core values
 Core values are what support the vision, shape the culture and reflect what the company
values
 They are the essence of the company’s identity – the principles, beliefs or philosophy of
values
 Establishing strong core values provides both internal and external advantages to the
company
 Accountability – Acknowledging and assuming responsibility for actions, products, decisions,
and policies. It can be applied to both individual accountability on the part of employees and
accountability of the company as a whole
 Balance – Taking a proactive stand to create and maintain a healthy work-life balance for
workers
 Commitment – Committing to great product, service, and other initiatives that impact lives
within and outside the organization.
 Community –Contributing to society and demonstrating corporate social responsibility
 Diversity – respecting the diversity and giving the best of composition. Establishing an
employee equity program
 Empowerment – Encouraging employees to take initiative and give the best. Adopting an
error-embracing environment to empower employees to lead and make decisions
 Innovation – Pursuing new creative ideas that have the potential to change the world
 Integrity – Acting with honesty and honor without compromising the truth
 Ownership – Taking care of the company and customers as they were one’s own
 Safety – ensuring the health and safety of employees and going beyond the legal
requirements to provide an accident-free workplace.
 Topic – 17

Baroda GEMS – Advantages & Points for Improvement

The new Performance Management System (PMS) - launched - known as BARODA GEMS- Baroda
Growth & Empower Management System.

The objectives of introducing Baroda Gems are as under:

1- Laying down a more Scientific & Robust Target Setting Process.
2- Ensuring greater clarity of roles & expectations
3- Better measurement of actual performance based on scientific & data backed processes
 4- Empowering the officers through regular developmental feedback
5- Strengthening our rewards & recognition programmes
6- Ensuring greater transparency & objectivity in the entire process

The four key pillars under Baroda – GEMS :

1) Result Orientation
2) Objectivity and Rationality
3) Empowerment
4) Recognition of High Performance

GEMS - Advantages – For Organisation

 Improved organizational performance
 Employee retention and loyalty
 Improved productivity
 Overcoming the barriers to communication
 Clear accountabilities
 Saves time and reduces conflicts,
 Ensures efficiency and consistency in performance.

GEMS - Advantages – For Employees

 Clarifies expectations of the employees
 Self assessment opportunities
 Clarifies the job accountabilities
 Contributes to improved performance
 Clearly defines career paths and promotes job satisfaction
 Employee performance – Well documented

GEMS – Scope for Improvement

 Cohort system should be waved off – considering geographical and demographical reasons
 Training requirements of the employees has to be fullfilled based on the results of the GEMS
 GEMS should diagnose - individual and branch / organizational competencies.
 GEMS has to strengthen the relationship between the superior and the subordinate.

Topic – 18

Baroda Gurukul – Features & Suggestions for Improvement

Baroda Academy has launched new learning management system “Baroda Gurukul”.

In the process, our existing e-learning platform i.e. “Baroda Net Academy” is now discontinued and
replaced with new system called Baroda Gurukul. It is designed to provide different user
experience, increased accessibility and optimized utilization.

System will facilitate learning through pull rather than push approach.

It provides tools and features to maintain stringent and continual process of competency gap
analysis, training need assessment and impact measurement tools.

Salient features of Gurukul are as under…

  Single sign on for ease of login (Domain ID and password)
 E-Learning Course Launch, Rating and review
 Virtual Classroom or Webinar
 Live Baroda radio – Every Friday 4.30 pm
 Training calendar for upcoming class room trainings (with facility for self-nomination)
 Blended learning i.e. combination of e-leaning, video, documents, CLT, etc. forming one
course
 Facility to conduct surveys and Announcement
 Online Quiz.
 Mobile app Availability on Android and IOS app with off-line course download
 Competency Mapping of employees
 Leader Board for learning competition
 Micro learning through Video Library
 Digital Library Facility

Suggestions for Improvement

 It should be 24/7 facility and not a “after office hours” facility
 Removing excess image, text, and graphics
 Supporting complex information with graphs and charts

Topic – 19

Project Navodaya – Steps Initiated under it

On 20.07.2016 Bank of Baroda has unveiled Project Navoday, a comprehensive transformation for
the Bank across our business strategy, products, systems and organization that is going to propel
us forward in our ambition to be India’s (Premier) International Bank with a global standing,
delivering a differentiated world class experience to our customers.

Under Project Navoday following priority areas are being undertaken:

 Establish long term and profitable customer relationship across businesses.

 Expand our corporate and international banking businesses through dedicated Relationship
Managers.
 Redesign processes and systems.
 Make our future ready.
 Realignment of structures across the Bank.
 Unleash the potentials of our people.
Bank has established a central Project Management Office (PMO) that will drive the change and
send out regular communication on the progress achieved. Additionally dedicated Change leaders
are being identified.

Every Month “Navoday Times” is published, where in all updates and changes are enshrined and a
monthly quiz is also conducted with announcement of three monthly winners.

Under “We Lead” initiative the next generation of Leaders are being developed across the Bank as
under -…

Scale Leadership interventions

I, II and III Sayaji Rao Gaekwad Scholars Program
IV Baroda Rising Stars Program
V Baroda Emerging Leadership Program
VI & VII Baroda Senior Leadership Program

Topic – 20
Sussessful Regional Head Qualities
Few important qualities of the successful Regional Head are as follows…

 Leadership : In order to be an effective RH, you need to be able to lead your employees in
an efficient manner
 Reliability : A RH, who is leading a team has to be reliable. This means being available for
your employees, getting things done that you said you would, and supporting your team
however needed.
 Respect for Employees : If you don’t respect your employees, there will definitely be tension
in your workplace. Be cognizant of their time and abilities, be able to listen and communicate
with them, and be a resource of knowledge and guidance.
 Orientation towards results
 Assertiveness - A Positive Attitude
 Prioritization
 Delegation
 Communication : Being able to communicate with your team is required when being an
effective RH.
 Empathy
 Integrity / Honesty
 Knowledgeable
  Organization : If you aren’t organized in your position, there’s a good chance that the
employees you manage won’t be either
 Confidence : To be a successful RH, you need to be confident in your abilities, experience,
and decisions.
 Time Management

Topic – 21
Bank’s Present NPA Position & Strategy for Recovery

What is NPA :-
Non-performing Assets’ (NPA) are the loans that are not repaid and are not generating any
income to the lender.

The gross NPA ratio for Public Sector Banks (PSBs) as a category is 14.6% in the financial year
(FY) 2017-18, as per Reserve Bank of India (RBI) data and crossed Rs 10.25 Lacs Crores as on
31-March-2018.

Our Bank Position

As on 30-Sep-2018, the gross NPA of our Bank is Rs 55,121 Crore, which is a crossing concern.
GNPA Ratio is 11.78 %

Causes of NPA :-
 Many loans are given to big companies without thoroughly analyzing the repaying
capacity that companies and the owners has.
 Around 80% of NPA are from willful defaulters.
 Some loans are given to the big companies that are facing losses and are about to shut
down. This can be attributed to corruption and nepotism.
 Banks are not yet free from government and political influence. Some politicians are
using their power to grant loans to undeserved business persons.
  Without conducting field study and relying completely on project report is another cause.
 After granting loans, banks are not observing how the loans are spent. Many willful
defaulters are spending the loans unproductively which will not help to grow business in
anyway. For example, DCHL took many loans from many banks and spent the loan
amount by investing in IPL, buying luxury cars, granting bonuses etc.
 To grant huge loans, banks form as a consortium and a big bank among them leads
it. Small banks blindly follow big bank in granting loans that company. If that big bank take
wrong decision, small banks will suffer.
 Some companies are taking loans but are not able to finish their projects. As a result, the
lender bank is giving more loans to it to finish the project in the hope that they can
recover their previous loan. But in many cases, this is further aggravating the NPA
problem.
 Till 2016, there were no strict laws to recover NPAs.

Impact of NPA :-
 NPA are weighing down the banking system. Many banks do not have enough money to
grant new loans, which is a blow to the way of income to the banks.
 To help banks, government is investing more money on banks with taxpayers money. In
2016-17, government allotted Rs. 25,000 crore to banks.
 Banks coming under PCA, which stipulates Mandatory & discretionary restrictions on
banks.

Strategies to reduce NPA :-

 Recovery through Compromise / Lokadalat, SARFAESI, DRT, IBC, Suit File, etc.
 Creating ‘Stressed Asset Recovery Bank‘ and transferring NPAs to it. In this way NPAs
will be cleared for banks on papers. This method is useful to resolve the stress in the
banking system.
 The immediate solution is to sell Non performing assets. From April 2017, banks are
selling more NPAs.
 Among all defaulters, the top 20 companies created nearly Rs. 1.54 lakh crore NPAs. If
banks concentrate on these major defaulters, government may not have to rescue banks.
 Banks should thoroughly inspect the company they are giving loans to. Loans to bad
companies will lead to lack of money for good investments.
 It’s better to display the defaulters’ name list publicly. This will cause fear and acts as a
deterrent.
 After granting loan, banks should observe the capacity of the company continuously and
should be able to assess whether it is about to bankrupt. In this way, banks can sell the
assets before the loans become NPA.
 Topic – 22
12 Point Program on MSME
The Prime Minister, Shri Narendra Modi, in Nov’ 2018 launched a historic support and outreach
programme for the Micro, Small and Medium Enterprises (MSME) sector. As part of this
programme, the Prime Minister unveiled 12 key initiatives which will help the growth, expansion and
facilitation of MSMEs across the country. They are as follows…

1. 59-minutes loans
The GST-registered micro, small and medium enterprises (MSMEs) will be sanctioned a loan of Rs 1
crore in just 59 minutes through a new portal.

2. Rebate in interest rate

The GST-registered MSMEs will get 2% subvention or rebate on incremental new loans of up to Rs 1
crore. Interest subvention on pre- and post-shipment credit for exports by MSMEs has also been
increased from 3% to 5%.

3. Cash flow certainty

It is now mandatory for companies with a turnover of more than Rs 500 crore to join Trade Receivables e-
Discounting System (TReDS) so that MSMEs do not face trouble in cash flow, PM Modi said.

4. Procurement by PSUs
Public sector companies, which were mandated to source 20% of their annual procurement from MSMEs,
will now source at least a quarter of their requirement (25%) from the sector.

5. Women entrepreneurs
Out of the 25% procurement mandated from MSMEs, 3% must now be reserved for women
entrepreneurs.

6. Government e-Marketplace (GeM)

All central public sector enterprises will have to take membership of the Government e-Marketplace
(GeM) to facilitate online procurement of common use goods and services by various government
departments and organisations.

7. Technological upgradation
The government announced Rs 6,000 crore package to facilitate better technological support and tools to
small industries. The money will be used for 20 hubs and 100 tool rooms for technology upgradation.

8. Pharma companies
The government will form MSME pharma clusters. 70% cost of establishing these clusters will be borne
by the government.

9. One annual return

MSMEs will have to file just one annual return on eight labour laws and 10 central rules.

10. No more inspector raj

Inspections of factories in the MSME sector will be sanctioned only through a computerised random
allotment and inspectors will have to upload reports on the portal within 48 hours.

11. Relaxation in environmental clearances

MSMEs will now need single air and water clearance and just one consent to establish a factory.

12. Ordinance in Companies Act

An ordinance has been promulgated to simplify the levy of penalties for minor offences under the
Companies Act.
 Topic – 22
GST – Boon or Bane

The Goods and Services Tax is a unified, destination-based tax that was implemented in India
from July 1, 2017 to effectively replace all the existing indirect taxes, including service tax and vat.
The GST has directly affected the businesses involved in the selling/buying of good and services,
as well as consumers, in the country.

Whereas the prices of some goods/services have gone down, some other facilities have become
costlier in the post-GST regime. There are some predefined tax rates for various commodities under
GST and some basic items like food, milk, etc., have been kept tax-free, while petroleum products
have not yet been included under the cover of GST. The impacts of GST are being noticed as we
move forward into this new tax era.

Advantages

 GST is expected to build a more transparent and corruption-free tax system in India.
 It is easy to start a business in the post-GST regime and tax regulations are easier than
before.
 Composition mechanism is there to reduce the tax burden from small businesses and
startups.
 More simplified movement of goods and/or services between states and within the country.
 GST is calculated on the total amount, irrespective of the type of sales and services.
 GST has eliminated the cascading effect of taxes by introducing a unified tax system.
 Since it is a destination based tax, the tax will only be paid by the consumer upon delivery of
goods/services.
 The implementation of Goods & Services tax puts India in the line of international tax
standards, making it easier for Indian businesses to sell in the global market.
 Inflation is expected to stay under control after the implementation of GST.
 GST is expected to reduce the price of production, operational and others costs that will
benefit the end consumers.
 Since all the records and data are now available on a single platform, it has become easier
for the tax authorities to identify and deal with tax evasions.
  One major benefit of GST is that the government is now receiving more taxpayer
registrations than ever before.

Dis-Advantages

 GST compliance and tax filing has increased the implementation cost for businesses, as they
are required to invest in computers, accounting (GST) software and/or trained GST experts
(CAs and accounting experts).
 The process of GST compliance is also proving daunting as most businesses are not yet fully
aware of the rules, provisions and processes of the new tax system, including the process of
return filing, GST registration, returns filing schedule, invoicing and billing, etc.
 The overall cost of doing business is going to increase, at least in the first few months of
GST.
 The tax relaxation limit for small manufacturing businesses, which was 1.50 crores earlier, is
now Rs. 20 lakh under the GST system. This has effectively increased the tax burden for
such businesses.
 No clarification about tax holidays has further increased operation costs for textile, pharma
and other manufacturing industries.
 The tax rate has been increased for many products, thus increasing their costs.
 The cost of refurbishing has increased due to increased tax, thus increasing the price of
refurbished products.
 Businesses are required to have separate registrations for multiple business entities in
different states. It will increase the burden of tax compliance.
 GST has reduced the tax revenue of some states as they are now required to share
revenues with the central government.
 The tax will be paid by the end consumer, which makes it a non-consumer-friendly tax
system.

Conclusion
Conclusively, the GST has both its pros and cons, and it is expected to bring a positive change in
the tax system of India. For now, we should hope for the best.
 Topic – 23
FINTECH – Disrupters for Banking Business
In this age of transparency and digitization, Fintech firms and start-ups have been the major
gainers. They are also emerging as strong players in the financial sector by offering personalised
and transparent offers to the customers. By weakening the loyalty of established customer base,
these newly emerged Fintech firms are giving hard time to traditional banks.

With Tech giants like Amazon, Flipkart and WeChat venturing into finance sector, it clearly indicates
that they are doing everything in their capacity to be in the limelight always. On the other hand
banks are suffering due to their non-flexible boundaries.

While there exists a serious rivalry between the two, collaboration is also being perceived as an
option for mutual benefit. But before this brand new “Banking + Fintech” financial ecosystem attains
immense importance, it is imperative to understand its pro’s and con’s.

Pros / Advantages:-

 Improved Profitability: ‘The Fintech revolution’ is being understood as the reason for the
termination of legacy banks. Thus now it is essential for the existing traditional banks to
comprehend these firms as partners rather than follies. This will not only enhance the overall
profitability of the banks but also improve their degrading performance in the recent years.

 Benefits of data enrichment: Data enrichment is an innovative way through which the
Fintech firms use machine-learning engines to add value to the plethora of existing data of
customers acquired from millions of transactions. This will surely help the banks to not only
identify particular customers but also in maintaining them.

 Next wave of tech generation: With the foray of Tech giants in finance, the new wave of
tech generation has arrived. But full benefits can be reaped when these new technologies
reach the other major participant of this sector. Thus the bank and tech alliance will not only
reduce costs but also increase efficiency of the banks, due to superior technical know-how
abilities.

 Benefits of portfolio diversification: With their expertise in giving importance to particular

customer needs, the Fintech firms will help banks to diversify their loan portfolio as now the
customers will be provided what they want.

 Increased customer awareness: The EY FinTech Adoption Index 2017 has stated that the
percentage of people aware about FinTech facilities in 2017 has risen to 84% as compared
to 62% in 2015. Thus in a such a scenario it is absolutely beneficial for the banks to merge in
these small scale Fintechstartups and deliver greater value to their customers.
Disadvantages / Cons

 Huge costs: One of the primary concern of a bank is its costs such security cost,
compliance costs, auditing expenditure. These costs will only increase with such
collaboration on account of provision of secure network and complex structure of a
FinTech firms operations.

 Complexity in dealing with customers: Due to a nexus of financial data resulting from
data enrichment, the dealing with customers and other organization will be difficult and
time consuming.

 Reluctance of Banks: Banks are reluctant to alter their already well-established tech
system which will hinder the efficiency due to dissimilarity in the Tech architecture.

Conclusion :-
The Bank and FinTech collaboration is deemed to be beneficial in enhancing the efficiency of
finance sector due to the advanced technologies of the Tech organisations and with the advantage
of the established customer base of large banks. But there are still some stones left unturned on
account of expenditures and the complexity possessed.

Topic – 24
Bank of Baroda – Fintech : Initiative
SME & Large Corporate

 Digital Seller Financing : Collaboration with Amazon to offer collateral-free working capital
loan to over 2 Lac sellers on the latter's platform.

 Alternate Data Based Underwriting : Tie-up with CreditMantri for technology that helps
Bank to draw data of our SME merchants and assess the customers on the strength of
personal and business data points.

 Vehicle Financing : Bank of Baroda partnered with UBER, to finance individuals desirous of
owning a vehicle and attaching it to UBER's platform. This initiative is promoting "Start up
India" Scheme by plummeting entry barrier to financing and fostering drivers to become
entrepreneurs.

 GST Enabled Accounting Solution : Tie-up arrangement with Versify to offer their ready
built GST enabled accounting software as 3rd party product to our customers on monthly
subscription basis.

 Bankability Kit : Bank of Baroda has partnered with SIDBI for mentoring and supporting the
MSE ecosystem. A bankability kit is designed enabling MSEs to evolve as bankable entities.
This kit features different themes ‘Know Enterprising Self ’, ‘Know your Banker’ and ‘Know
Banking’.
 MoU with SIDBI : Bank of Baroda signed a MoU with SIDBI with the objective of working
together to strengthen credit delivery system and facilitate smooth flow of credit to the
MSMEs and Startups in a hassle-free manner.
 Information-as-a-Service : Collaboration with Probe42 to obtain information on listed/un-
listed companies from a number of sources, including the ROC, defaulter's lists, public filing,
etc. available on demand for lending and gaining new business.

 TReDS: Online Discounting Platform : Bank of Baroda has on boarded all 3 RBI approved
Trade Receivables Discounting System (TReDS) platforms i.e. A.TREDS, RXIL,
MYNDSOL thereby becoming the first Bank to support this novel Fintech initiative. This
online platform enables discounting of invoices of MSME sellers through a bidding process to
ensure prompt realisation of receivables.

Retail

 Housing Loan :
Partnership with Deal4loans for generation of housing loan leads through their platform.

Bank of Baroda has tied up with Switchme for targeting existing housing loan borrowers who
are looking to switch lenders to take advantage of lower interest rates.

 Education Loan
Tie-up arrangement with Gyandhan and Eduloans to source mortgage backed Education
loan applications for overseas studies.
Wealth Management

 Baroda M-Invest : Bank of Baroda partnered with Fisdom to launch Baroda M-Invest app in
the market for the customers. The app blends cutting edge technology with personalized
financial advice for investing in mutual funds.

Technology

 Truecaller payment : Bank of Baroda Partnered with Truecaller (Software Scandinavia

AB, which is a privately held company in Stockholm, Sweden) for offering UPI payment
services of BHIM Baroda Pay UPI app to users on their app (Truecaller Pay app which
resides under its parent app) via secured API gateway. With this tie-up users of any bank can
link their bank account on Truecaller Pay for payments, such as Utility Bill Payment, P2P
funds transfer, payment via QR code, request payment and check balances.

 Sound Based Payment : Bank of Baroda partnered with ToneTag for contactless proximity
communication using sound wave. The app SDK is integrated with Bank of Baroda’s M-
Connect Plus mobile banking application for making payment on ToneTag enabled POS
terminals.

 Payment Gateway : Collaboration with Razorpay, a payment gateway with the aim to
revolutionize online payments by providing clean, developer-friendly APls and hassle-free
integration.

 Blockchain : Bank of Baroda is founding member in two major Blockchain communities to

explore, build and implement blockchain solutions in a collaborative environment. BankChain
community has total 37 member banks across the globe, which is managed by Primechain
Technologies Pvt. Ltd. Another community which is managed by EdgeVerve Pvt. Ltd
having nine major Indian banks in it. The communities were formed with an objective to
enable banks to minimize fraud and maximize efficiency, security and transparency. Bank of
Baroda is experimenting with around 10 interesting use-cases on Blockchain.

 Baroda Finathon Challenge : Bank had introduced “Baroda Finathon Challenge”, a

hackathon contest, inviting the techies, developers, students and start-ups to come up with
exciting, innovative, novel and viable solutions themes such as Innovation, Customer
Acquisition, Customer Experience, Conversational Banking, Collections, Compliance and
Operational Efficiency. The challenge successfully concluded by sifting out the most
innovative solutions out of 4,600 teams. On 26th Feb, the Finale was conducted in Mumbai
to adjudge 3 winners amongst 8 shortlisted teams.
Fin-Agritech

 Post-Harvest Finance : Bank of Baroda signed MOU with Allfresh Supply Management
Pvt Ltd for extending finance to the farmers against pledge of warehouse receipts issued by
the company.
 Greenhouse-in-Box : Collaborated with Kheyti Tech Pvt Ltd to finance the Greenhouse-in-
Box (GIB). Company offers services like inputs, training and market linkage creating a
seamless path for steady income.
 Farm Machinery on Rent : Partnership with EM3 to provide finance for farm machinery &
farm implements to be given on rent. EM3 offers its services on a Pay-for-Use basis for every
step of the farming process – from soil preparation to harvest.

 Mobile Based Information : Tie-up with RML Agtech Pvt Ltd to provide mobile based
information to the farmers.

 High Quality Inputs : Bank of Baroda partnered with Lawrencedale Agro Processing
India Pvt Ltd (LEAF) for providing access to farmers to high quality inputs.

Publication

 FinTalk : ‘FinTalk’ is a daily Newsletter which has all relevant news pertaining to the Fintech
sector and events that affect the Fintech space.
 Collections : Collections is a Special Edition of our daily fintech newsletter FinTalk marking
the top 15 FinTalk themes from over 200 digests published in 2017. This will provide a great
way to revisit the trends and developments of Fintech space.

Topic – 25
Strategies to Improve Various Portfolios
Priority Sector / Agriculture / SME / Retail / Corporate
 Every bank should train a band of senior- and middle-level employees in the art of
lending to the _____ sector and they should continue to be encouraged to upgrade their
skills in the latest developments in that area of lending.

 Instead of making available ____ lending facilities in all branches, every bank should set
up specialised branches in all potential centres and extend ____ lending through these
branches alone where trained manpower should be deployed to facilitate proper sanction
and monitoring of these loans and advances.
 RBI should come out with an incentive-based system to encourage lending to the ____
sector, as an incentivised system will receive better receptivity at all levels, and this will
provide the necessary thrust to _____ lending by banks.

 The staff working in those specialised branches lending to the ____ sector can be
provided with appropriate incentives based on the level of lending to the ___ sector at
each of these branches.

 A certain percentage of profit can be exempted from income-tax for those banks reaching
these levels of lending to the ___ sector.

 Any other incentive could be thought of to provide impetus for lending to the ____ sector.

 All subsidies now provided to banks for lending to ____ sectors should be withdrawn,
and in its place, appropriate fiscal incentives should be provided so as to minimise
paperwork and misuse of the subsidy system.

 In order to encourage the staff of commercial banks to improve lending to the ____
sector, the bank managements, particularly in the public sector, should also change their
attitude and follow the basic principle followed by banks all over the world that “error of
judgment is not negligence”. All loans granted by the branch managers should be viewed
from this angle and appropriate protection has to be provided to the operating staff when
loans go bad due to reasons beyond their control. This will give the required comfort to
staff at all levels and radically change their attitude towards ____ lending and help the
banks to do a better job in this area of banking.

 The ____ community in our country requires a lot of counseling and the bank officers
engaged in this activity should be trained in this art of providing advice and counsel
whenever needed and consider the requests of the borrowers with a humane touch.

 To Reduce Credit Risk in Lending, Empower Staff Members Beyond Performing Cash
Flow Analysis and Towards Real Customer Relationship Building and Management

 TAT should be reduced both in letter and spirit

 Functional collaboration has to be increased

 Cultivate centers of influence as referral sources. One of the most effective ways to
learn about new lending opportunities and get introductions to potentially qualified
borrowers is to cultivate relationships with accountants, attorneys, insurance agents and
brokers, and other service providers in your community.

 Increase community involvement and visibility

 Cultivate cross-sell opportunities. One of the easiest and most steady sources of new
business and related revenue is to reach out to current customers for additional business.

 Target the customers of your troubled competitors. Another strategy to help grow
your portfolio is to pick off a competitor’s disgruntled customers. Chances are there’s at
least one troubled bank in your market area that is unwilling or unable to meet many of its
customers’ financing needs.
 Topic – 26
EASE : Our Bank Initiative
Responsive & Responsible PSBs Banking Reforms Roadmap for a New India

[EASE - Enhanced Access and Service Excellence - Based on the recommendations made by
PSB Whole Time Directors and Senior Executives in “PSB Manthan” in Nov’ 2017]

[EASE has Six Themes]

Theme – 1 : Customer Responsiveness: EASE for customer comfort

Our Bank Initiative :

 Banking from the comfort of home through Net Banking, M Connect Plus
 Grievance redressal through Online Complaint Management System
called SPGRS (Standardized Public Grievance Redressal System)
 Comfort to Senior citizens and the differently abled through new initiative
called “Door Step Banking”
 Simplification of forms
 Pleasing ambience of branch

Theme – 2 : Responsible Banking: Financial stability, governance for ensuring outcomes, and
EASE for clean & commercially prudent business

Our Bank Initiative :

  Creation of a Stressed Asset Management Vertical (SAMV) – ROSARB /
ZOSARB
 Corporate lending through rigorous due diligence
 Strict segregation of pre- and post-sanction roles & responsibilities

Theme – 3 : Credit Off-take: EASE for the borrower and proactive delivery of credit

Our Bank Initiative :

 EASE for the borrower and Proactive reach-out to borrowers., through
products viz… Pre-Approved limit to Liability Customers, Pre-Approved
Loan to Home Loan Borrowers, Pre-Approved Loan against Property to
Current Account Customers, etc.

Theme – 4 : PSBs as UdyamiMitra: EASE of financing and bill discounting for MSMEs

Our Bank Initiative :

 Online application @Udyamimitra.com and Decision within 15 days
 EASE of bill realization for MSMEs
 Single-point MSME Relationship Officer – through Relationship-led
coverage model–with a list of High Priority accounts and supported by 15
sector specific credit processing teams.

Theme – 5 : Deepening Financial Inclusion & Digitalisation

Our Bank Initiative :

 EASE through near-home banking, microinsurance and digitalization viz…
M Connect Plus Express, UPI App, Baroda M Pay, etc

Theme – 6 : Ensuring outcomes – HR: Developing personnel for Brand PSB

Our Bank Initiative :

 Project Parkhi: The Development Centre that will have the capability to
assess one's strong areas, aptitude for a specific type of job and the skill
gaps
 Core Values
 Life-cycle concept of training that aims to address the capability building
needs of the employees
 Change Leader Concept : Change Leaders will play an important role in
implementation of initiatives
 Baroda Anubudhi
 Baroda Gurukul App
 Creation of Centre of Excellence for Persons with Disabilities
 Topic – 27
Audit Transformation & Its Impact
[Key Changes in Existing and Revised Internal Audit Framework]

Under the present model called RCM (Risk Control Matrix), the branches are rated based on the
below parameters :-
 Business Risk – Max Marks 500
Under Business Risk the following parameters are accessed…
 Credit Risk
 Earnings Risk
 Liquidity Risk
 Business & Environment Risk
 Operational Risk
 Control Risk – Max Marks 500
Under Control Risk the following parameters are accessed…
 Operational Control Risk
 Credit Control Risk
 Compliance Risk
 IT Risk
 Total Max Marks – 1000

Business Performance Risk is removed from the current audit rating model as they are mostly
structured around achievement of budgets by the branches and such risks may be looked at by the
Controllers of the Branches.

An important change is scoring separately for Operational & Credit Risk. Now we will have separate
Control Risk scores for Operational & Credit Risk. In managing of Compliance & IT Risk the role of
Corporate/ Zonal offices is much higher and the scores for the same has been scaled down.

Under the present model, the branches are categorized into following 3 categories
Category Branches Credit Portfolio
I All Corporate and SME Intensive Branches More than INR 200 Crores
II High Value Retail Branches 200 Crores to 50 Crores
III Other Branches 50 Crores and below

RCM is based on sampling & sampling is done as follows…

1. Fresh sanction & review with incease : 100%
2. Outstanding balance more than Rs.25.00 lacs and above : 100%
3. Outstandinf balance rs.10.00 lacs to rs.25.00 lacs : 50%
4. Outstanding balance rs.1.00 lacs to rs.10.00 lacs : 35%
5. Outstandinf balance below rs.1.00 lacs : 10%

Risk Category of Branches are

 Low Risk
 Medium Risk
 High Risk
 Very High Risk
 Extremely High Risk

If high risk is for two consecutive audits, then the branch will be automatically rated as Very High
Risk Branch.

Also, Compliance checking will be done in 10 % of the branches which are rated as Medium or
High Risk in the previous year.

Impact of Audit Transformation

 Effectiveness
 Fraud prevention and detection
 Systems and controls : The financial controls and systems, and the risk management
systems of the branches will be under proper norms.
 Ensure adequate coverage of the business functions by audit
 Ensures that audit findings are supported by adequate evidences : Under the revised model,
the auditors will be required to maintain adequate working papers / audit evidences. This is a
basic requirement under the Quality Assurance process will be oversee the audit process.
 Whether changes in the operating framework of the bank are being adequately taken into
account during the audit process
 Oversight on the auditors activity is maintained
 Remove Subjectivity in Rating Process : The RCMs provided have built-in formulas or
guidance for calculating the Control Risk. It is envisaged that once the Audit Workflow is
automated, the rating will come directly from the system based on test results of the samples
selected for review. This will automate the rating process and remove the subjectivity in the
rating process
 Ensures good Leadership for the branch, who is responsible for for the long-term success of
the branch in general and Bank in particular
 Topic – 28
SARFAESI – Process in Brief
The Securitisation and Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 (SARFAESI) empowers Banks / Financial Institutions to recover its dues through
enforcement of Security Interest, without the intervention of the Court / Tribunal.

The exercise of all rights by Bank as Secured Creditor under the Act has to be done through an
Authorised Officer. As per the Security Interest (Enforcement) Rules, 2002, the Authorised Officer is
an officer of the Bank not below the rank of a Chief Manager specified by its Board of Directors

EXCEPTIONS: - SARFAESI Actions can not be initiated in the following instances.

 Contractual dues is below Rs.1/-lakh
 Security interest over Agricultural Land.
 Any case in which the amount due is less than 20 % of the principal amount and interest
thereon

Demand Notice - Under Section 13 (2) OF SARFAESI ACT.

When the borrower commits default in the repayment of the secured debt and his account is
classified as Non Performing Asset (NPA), the Secured Creditor can issue notice to the Borrower/
Guarantor/ Mortgagor (collectively referred as Borrower as per the Act), under Section 13 (2) of the
Act demanding discharge in full his liabilities within sixty days from the date of notice and in case
the borrower fails, the secured creditor shall be entitled to take all or any of the measures under
sub-section 13 (4) of the Act

Objection(s) / Representation(s) to Demand Notice - Sec. 13(3A):

If any objection / representation to the Demand Notice issued is received from the borrower/
guarantor/ mortgagor Bank’s reply within 15 days of receipt of objection/ representation is
mandatory.

POSSESSION OF SECURED ASSETS – After 60 days: - Sec 13 (4)

If even after 60 days of service of the demand notice/ publication of demand notice, as the case
may be and the amount demanded in the Demand Notice is not paid, the Authorised Officer (AO)
shall proceed to realize the amount by taking possession of secured assets.

Filing of CAVEAT:
If any legal action by the Borrower/ Guarantor/ Mortgagor is anticipated against Bank’s action/
measures u/s 13(4), it is suggested that we may file CAVEAT Application before DRT/High Court, so
as to prevent any exparte order against our Bank.

Application to CMM/ DM - [Sec. 14]

Where there is resistance or objection in taking possession of secured assets, the Secured Creditor
can approach/ file application to the Chief Metropolitan Magistrate (CMM) or the District Magistrate
(DM) as the case may be, seeking assistance in taking physical possession of the secured assets.
SALE OF MOVABLE PROPERTY.
Authorised Officer may sell the movable property which is taken into physical possession in one or
more lots and there should be clear 30 days between the date of publication of notice of sale in the
news paper and actual date of sale

If the first sale fails and the sale of movable assets is required to be conducted again, the
authorised officer, for conducting any subsequent sale, has to serve, affix and publish fresh notice of
sale of not less than fifteen (15) days to the Borrower

APPROPRIATION OF SALE PRICE

The Secured Creditor upon successful sale of secured assets is entitled to apply the money
received, firstly, for payment of all costs, charges and expenses properly incurred by the Secured
Creditor, secondly, for discharging the dues of the secured creditor and the residual money, if any,
has to be paid to the person entitled thereto in accordance with his rights and interests.

Topic – 29
Customer Segmentation - Radiance
Baroda Radiance is the personalized banking service of our Bank to cater to Banking and
Investment needs of HNI customers with “Total Relationship Value” (TRV) for Rs. 50 lakhs and
above. These HNI customers are called as “Radiance Customers”.

Objective of the Baroda Radiance:

 Assign a Dedicated Relationship Managers (RM) for Radiance Customers as one touch point
to cater to his / her banking and investment needs.

 A group of Relationship Managers will be attached to a Client Service Executive (CSE). This
CSE will conduct / execute banking and investment transactions originated / initiated by the
RMs. These CSEs will be given multi-sol access in Finacle to enable these transactions.

Criteria for identifying a New To Bank (NTB) customer as Baroda Radiance?

If a new customer wants to open an account with our Bank and avail the facilities of Baroda
Radiance, then they have to fulfill the following criteria.

 The account should be opened with the minimum balance of Rs. 10 lakhs and he / she will
be flagged as Radiance customer in CBS.
 The customer has to reach the minimum TRV level of Rs. 50 lakhs within 6 months of
opening the account, to continuously avail the facilities offered to the Radiance Customer. In
case of failure, the customer will be de-flagged at the end of the month in which, he / she
completes 6 months, after taking consent from the RM.

Benefits to Radiance Customers are as follows…..

24x7 concierge services : Bank has entered into an agreement with M/s Europ Assistance India
(EAI) for providing concierge service to its Radiance Customers.

Following Services are available under concierge.

A). Lifestyle Assistance

 Restaurant Referral and Arrangement
 Flower Delivery Assistance
 Gift/ Chocolate Delivery Assistance
 Hotel /Airline Referrals

B). Travel Assistance

 Pre-trip information services- Inoculation and Visa Requirement
 Lost Luggage Assistance
 Lost Passport Assistance
 Embassy referral services

C). Road Side Assistance (RSA)

 Emergency Towing Assistance
 On-site Repair Assistance
 Alternative Travel Assistance

Radiance – Effect on our Business

 Selling other banking products increases

  Profitability
 Increases brand image / reputation
 Attract new HNI Customers

Topic – 30
NIM – How to increase ?
“Net Interest Margin” measures the difference between interest paid and interest received,
adjusted relative to the amount of interest-generating assets.

To illustrate, take the simple case where a bank made loans equal to Rs 100 million in a
year. From those loans, it generated Rs 5.5 million in interest income. It also paid out Rs 2.5
million in interest to its depositors.

Calculate this bank's Net Interest Margin with the following formula:
Net Interest Margin = (Rs 5.5 million – Rs 2.5 million) / Rs 100 million = 0.03, or 3%.

Thus, if the demand for savings increases relative to the demand for loans, it is likely that
the Net Interest Margin will decrease. The opposite is true if the demand for loans is higher
relative to savings.

Bank of Baroda’s : Net Interest Margin (NIM) improved to 2.61 % in September 2018 quarter
from 2.34% in September 2017. NIM of international operations improved to 1.66% from 1.15%
last year.

How to increase ?
 Increase Loan Portfolio
 Increase low cost deposit viz CASA
 Increase Fee based income
 Selling of Wealth Management Products – Earn Commission
 Increase Government business
 Encourage Digital Products

Topic – 31
Whistle Blower Policy
(Govt. of India Resolution on Public Interest Disclosure & Protection of Informer (PIDPI)

As per Government of India Office Memorandum no 371/4/2013-AVD-III we reproduce “Whistle

Blower Policy” Guidelines as under Besides the Central Vigilance Commission (CVC) the
Designated Agency, as hitherto, the Chief Vigilance Officers (CVO) of the Ministries/Departments of
the Government of India are also authorized as the Designated Authority to receive written
complaint or disclosure on any allegation of corruption or misuse of office by any employee of that
Ministry or Department or any corporation established by or under any Central Act.

Government Companies, societies or local authorities owned or controlled by the Central

Government and falling under the jurisdiction of that Ministry or the Department. It is informed to the
general public that any complaint which is to be made under this resolution should comply with
following aspects:

1. The complaint should be in a closed/sealed envelope, addressed to the Secretary, Central

Vigilance Commission or to the Chief Vigilance Officer of the Bank.
2. The envelope should be super scribed with “Complaint under the Public Interest Disclosure”. In
case the envelope is not so super-scribed and closed/sealed, it will not be possible for the
Designated Agency (CVC)/Designated Authority (CVO) to protect the complaint under the above
resolution and the complaint will be dealt with as per the normal complaint policy of the
Commission.

3. The complainant should give his/her name and address in the beginning or at the end of the
complaint or in an attached letter.

4. The Designated Agency or the Designated Authority will ascertain from the complainant whether
he was the person who made the complaint or not by writing a letter to him/her.

5. The disclosure or complaint shall contain as full particulars as possible and shall be accompanied
by supporting documents or other materials.

6. The text of the complaint should be carefully drafted so as not to give any details or clue as to
his/her identity. However, the details of the complaint should be specific and verifiable.

7. In order to protect identity of the person, acknowledgement will not be issued and the whistle
blowers are advised not to enter into any further correspondence in their own interest.

8. The Designated Agency or the Designated Authority may, if it deems fit call for further information
or particulars from the person making the disclosure/complaint.

9. If the complaint is anonymous, the Designated Agency or the Designated Authority shall not take
any action in the matter.

10.The identity of the complainant will not be revealed unless the complainant himself has made the
details of the complaint either public or disclosed his/her identity to any other office or authority.

11.If any person is aggrieved by any action on the ground that he is being victimized due to the fact
that he had filed a complaint or disclosure, he may file an application before the Designated Agency
or the Designated Authority seeking redress in the matter, who shall take such action, as deemed
fit.

12.Either on the application of the complainant, or on the basis of the information gathered, if the
Designated Agency/Designated Authority is of the opinion that either the complainant or the
witnesses need protection, the Designated Agency/Designated Authority shall initiate suitable
action.

13.In case the Designated Agency/Designated Authority finds the complaint to be motivated or
vexatious under the resolution, action against complainant may be taken.
 Topic – 32
POSH
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

[GUIDELINES BY SUPREME COURT OF INDIA AND ITS IMPLEMENTATION IN THE BANK]

The Hon’ble Supreme Court of India in its judgment in WP (Crl) No. 666-70 of 1992 (Vishaka&Ors.
Vs. State of Rajasthan &Ors.) has laid down guidelines for prevention of sexual harassment of
women at work places. The guidelines and norms prescribed are as hereunder :-

A. Definition of sexual harassment :-

Sexual harassment shall include such unwelcome sexually determined behaviour
(whether directly or otherwise) as
(a) physical contact and advances;
(b) demand or request for sexual favours;
(c) sexually coloured remarks;
(d) showing pornography; or
(e) any other unwelcome physical, verbal or non-verbal conduct of a sexual nature.

Where any of the above acts is committed in circumstances where under the victim of such conduct
has a reasonable apprehension that in relation to the victim’s employment or work, whether she is
drawing salary or honorarium or voluntary, whether in Government, public or private enterprise,
such conduct can be humiliating and may constitute a health and safety problem. It is
discriminatory for instance when the woman has reasonable grounds to believe that her objection
would disadvantage her in connection with her employment or work including recruitment or
promotion or when it creates a hostile work environment. Adverse consequences might be
 visited if the victim does not consent to the conduct in question or resists any objection
thereto.

B. Preventive steps :-
All employers whether in public or private sector should take appropriate steps to prevent sexual
harassment as under :-

a Express prohibition of sexual harassment as defined above at the work place, to be notified,
published and circulated in appropriate ways.
Rules/ regulations relating to conduct and discipline should include rules/ regulations prohibiting
sexual harassment and provide for appropriate penalties in such rules against the offender.

b. Appropriate work conditions should be provided in respect of work, leisure, health and hygiene
to further ensure that there is no hostile environment towards women at workplace and no
employed woman should have reasonable grounds to believe that she is disadvantaged in
connection with her employment.
C. Criminal proceedings :-
Where such conduct amounts to a specific offence under the Indian Penal Code or under any other
law, the employer shall initiate appropriate action in accordance with law by making a complaint
with the appropriate authority. In particular it should ensure that victims or witnesses are not
victimized or discriminated against while dealing with complaints of sexual harassment. The victims
of sexual harassment should have the option to seek transfer of the perpetrator or their own
transfer.

D. Disciplinary action :-
Where such conduct amounts to misconduct in employment as defined in the relevant service
rules, appropriate disciplinary action should be initiated by the employer in accordance with
those rules.

E. Complaints Mechanism :-
Whether or not such conduct constitutes an offence under law or breach of service rules, an
appropriate complaint mechanism should be created for redressal of the complaint and such
mechanism should ensure time-bound treatment of complaint.

F. Complaints Committee :-
The complaints mechanism referred to in 7 above should be adequate to provide where necessary
a Complaints Committee (CC), a special Counselor or other support service including
maintenance of confidentiality.

The CC should be headed by a woman and not less than half of its members should be women.
Further to prevent possibility of any undue pressure or influence from senior level, CC should
involve a third party either NGO or other body who is familiar with the issue of sexual
harassment. CC should make an annual report to the Government department concerned of
the complaints and the action taken by them.

G. Workers’ initiative :-
Employees should be allowed to raise issues of sexual harassment at workers meeting and
other appropriate forum and it should be affirmatively discussed in the employer – employee
meetings.

H. Awareness :-
Awareness of the rights of female employees in this regard should be created in particular by
notifying the guidelines in a suitable manner.

I. Third Party Harassment :-

Where sexual harassment occurs as a result of an act or omission by any third party or an outsider,
the employer and the person in-charge will take all steps necessary and reasonable to assist the
affected person in terms of support and preventive action.
On receipt of advice from RBI for strict compliance of Supreme Court guidelines, Bank has set-up a
complaints mechanism to deal with the complaints of sexual harassment at work place. Bank had
circularized the guidelines of the Hon’ble Supreme Court vide circular no. CO/BR/90/76 dated
16.04.1998.

Conduct Regulations / Service rules have been amended to include prohibition of sexual
harassment as under :-
 Bank of Baroda Officer Employees’ Conduct Regulation 24 (A).
 Para 5 (t) of Bipartite Settlement dated 10.04.2002 – Gross Misconduct.

A Complaints Committee (CC) headed by a lady Executive called the Chief Liaison Officer has been
set up. 50% members of the CC are lady employees. In each Zone, Zonal Liaison Officers are
appointed for easy accessibility to lady employees.

Complaints Mechanism :
 A complaint of sexual harassment is required to be given in writing to Zonal Liaison Officer
(ZLO) within –15- days of the occurrence of the incident. If any aggrieved lady employee
seeks her own transfer, the same shall be considered by the Zonal Head/ Regional Head.

 The complaint may also be given either to Chief Liaison Officer (CLO)/ Zonal Head/
Regional Head.

 Zonal Head/ Regional Head, as the case may be (for Officers - Zonal Head and for workmen
- Regional Head), shall then discuss the complaint with ZLO and give a briefing for an
investigation into the complaint.

 ZLO then shall discuss the complaint with both the parties separately viz. the accused and
the complainant.

 ZLO may also visit the scene of the alleged incident, talk to witnesses, ascertain
background of both the parties and submit investigation report.

 Zonal Head/ Regional Head shall discuss the investigation report with ZLO.

 If Zonal Head/ Regional Head is satisfied that there is a prima-facie case of sexual
harassment, he shall then immediately separate both the parties.

 Zonal Head/ Regional Head shall then call for explanation from the accused party.

 Thereafter, Zonal Head/ Regional Head shall send to Chief Liaison Officer at Corporate
Office, the complaint and the investigation report along with his comments thereon.

 CLO shall place before the CC the entire report received from Zonal Head/ Regional Head
for deliberation.

 CC shall deliberate upon the case, call for further clarification/ order a fresh investigation if
required, and thereafter advise Zonal Head/ Regional Head whether the case falls within the
ambit of sexual harassment in terms of SC judgment or otherwise.

 Zonal Head/ Regional Head shall then proceed to take action in his capacity as
Disciplinary Authority and institute departmental action, if required.
  After the departmental enquiry is concluded and penalty imposed or exoneration, as
the case may be, the Zonal Head/ Regional Head shall report back to the CC, the action
taken.

 The action taken report shall be placed before CC by CLO for information and reporting to
Chairman and Managing Director.

 The CLO shall make an annual report to the Government concerning the complaints received
and the action taken by the Bank.

Role of Zonal Liaison Officer (ZLO) :-

 ZLO is a contact point for lady employees to lodge sexual harassment complaint and seek
redressal.

 ZLO’s job is to hear the complaint, take the complaint in writing and investigate the
complaint.

 ZLO shall discuss the issue with both the parties i.e. the accused and the complainant
separately.

 ZLO shall discuss the complaint with Zonal Head/ Regional Head in order to come to a
conclusion whether prima facie there is a case of sexual harassment.

 ZLO shall seek immediate transfer of the complainant, if the complainant so desires .

 ZLO shall enlighten the complainant about the procedures that will follow once she decides
to lodge a complaint and have her grievance redressed.

 ZLO shall ensure that if there is a prima facie case of sexual harassment then parties are
separated immediately.

 ZLO shall ensure that the investigation report with the comments of Zonal Head/ Regional
Head are forwarded to CLO at Corporate Office immediately as time is of essence.

 ZLO shall contact CLO at Corporate Office, in case, any clarification is required.

 ZLO shall ensure that the Zone/ Region follows the laid down procedures in cases of sexual
harassment.

Topic – 33
Project Finance
Project finance is the financing of long-term infrastructure, industrial projects and public services
using a non-recourse or limited recourse financial structure.

Usually, a project financing structure involves a number of equity investors, known as 'sponsors', a
'syndicate' of banks or other lending institutions that provide loans to the operation. They are most
commonly non-recourse loans, which are secured by the project assets and paid entirely from
project cash flow, rather than from the general assets or creditworthiness of the project sponsors
A Special Purpose Vehicle is a legal entity which is formed for a specific purpose such as a project
in this case. During the execution, the project’s funding requirements will be solely managed by the
SPV. The purpose is to insulate the holding company from any riskiness and eventualities arising in
the project. Moreover, when the project funds are duly protected and managed by the SPV, even
external investors gain more confidence in the company’s operations