CONTENTS

CHAPTER-1 1-9
General introduction of Rewa District:-
1. Introduction
2. Major Qualities of Rewa District
3. Chief industries of Rewa District
4. Banking development in Rewa District

CHAPTER-2 10-22
Introduction banking industries
1. Indian scenario of banking industries
2. Position of all banking industry in india

CHAPTER-3 23-28
Bank of India
1. About the bank
2. Our Vision
3. Mission
4. History
5. Products & Services

CHAPTER-4 29-32
About the Branch:- IFB (Industrial Finance Branch)
1. Form of Management

CHAPTER-5 33-36
Bank of India CSR activities
1. Karmayog 2008 CSR rating: 3/5
2. Current year corporate social responsibility

CHAPTER-6 37-39
Financial Position of Bank of India
1. Business Performance
2. Financial Performance

CHAPTER-7 40-41
Current Strategies of Company

CHAPTER-8 42-44
External Environment of the Company
1. Swat analysis of Bank of India
CHAPTER-9 45-47
Marketing
1. Recovery of Credit
2. Grievance Redressal

CHAPTER-10 48-55
Finance
1. Financial performance of Bank of India
2. Listing in share market
3. Table of share price for six months of Bank of India
4. CRISIL Rating for Bank of India
5.CHEQUE COLLECTION POLICY

CHAPTER-11 56-69
Operation and Production
1. Steps in term loan assessment
2. MARKET FEASIBILITY
3. ORGANIZATIONAL/MANAGERIAL FEASIBILITY
4. TECHNICAL FEASIBILITY
5. FINANCIAL FEASIBILITY
6. Credit report & Credit Rating

CHAPTER-12 70-73
Personal and HR department
1. Recruitment
2. Training and development
3. Performance appraisal forms of Bank of India (IFB)

CHAPTER-13 74-75
MIS or IT Department
1. Workflow for Information system in Bank of India (IFB)
2. Application of Software & Hardware

CHAPTER- 14 76-77
Other aspect of bank
1. awards / certificates received by bank

CHAPTER-15 78-79
Problems or Issues in Bank of India IFB

CHAPTER-16 80-81
Solutions of problem and issues
CHAPTER-17 82-87
Recommendations

CHAPTER-18 88-90
Learning

CHAPTER-19 91-92
Bibliography
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6
7
8
9
Chapter 2

1. Banking industries

Bank may be defined as a financial institution which is engaged

in the business of keeping money for savings and checking

accounts or for exchange or for issuing loans and credit etc. A set

of services intended for private customers and characterized by a

higher quality than the services offered to retail customers.

Based on the notion of tailor-made services, it aims to offer

advice on investment, inheritance plans and provide active

support for general transactions and the resolution of asset-

related problems.

The essential function of a bank is to provide services related to

the storing of deposits and the extending of credit. Basic function

may include Credit collection, Issuer of banking notes, Depositor

of money and lending loans.

Now a day’s banking is not in its traditional way , with the

advancement of technology  its focusing  on more  comfort of

customer  providing services such as:

10
• Online banking

• investment banking

• electronic banking

• internet banking

• pc banking /mobile banking

• e-banking

The importance of banking sector is immense in the progress and

prosperity of any State or country.

The economic progress and prosperity comes from the well-

rounded development and an impeccable banking management.

Banks in general, governmental and private, have eased our

financial transactions, security, and facilitated the funding for

establishing a business or industry.

Business banking industry is the industry in business banking

dealing with the different banking transactions which take place

while conducting a business. Business banking can also be

referred to as commercial banking. Business banking

industry deals with all the functions ranging from transferring

funds, business loans, online business transactions etc.

11
The success of a business largely depends on selecting the

correct bank for carrying out all the transactions efficiently.

Banks falling under the category of business banking

industry offer different charges and rates for the different

business banking services. One needs to check and compare the

charges offered by the different banks.

One needs to understand that opening an account under

the business banking industry is vital as one is expected to

maintain a long relationship with

the bank offering business banking services. Many prefer

to bank with the same bank where one has the

personal bank account. If an individual has maintained a good

track record during the tenure of personal banking , it can work

to ones advantage for availing the different business banking

services offered by the business banking industry.

The bank is required to have a business banking team

Services offered by the business banking service team

Cost of the services offered by the bank offering business

banking services under business banking industry.

12
Whether the bank offering business banking services imposes fee

for every single transaction or a lump sum for a particular

category of transaction. There are some banks which impose fees

for performing monetary transactions on behalf of the business

banking account holder. One needs to clarify the same.

Instant access deposit account :

This type of bank account is not needed for daily transactions.

Term deposit account:

In this type of account, the money is not required for the daily

transaction. Not only that the money is not likely to be required

for quite some time.

Foreign currency account:

A foreign currency account is required when an entrepreneur

wishes to trade in a foreign country.

Loan account:

When an entrepreneur is intending to take a loan for business

purpose.

Merchant account:

With the help of a merchant account, one is able to carry out

transactions involving credit cards and debit cards.

13
There are some banks which impose fees and charges for every

transaction made. There are yet others whose fee system may be

different.

Changing banks according to ones convenience:

In the event when one is not happy with the services of the

existing bank providing the business banking services, one may

at ones change banks for better services.

Transaction with foreign currency:

If an individual needs to constantly deal with foreign currency as

part of one’s business requirements, one should check as to how

the bank offering business banking facilities with regard to the

following matters:

Offers guidance with regard to dealing with

ones business products in the light of foreign countries as well

as foreign currency. How one should restructure ones strategy

with the changing currency rates and the risks involved in the

same. The utilities in carrying out transaction with foreign

currency.

Providing credit cards and debit cards for ones business:

The bank providing business banking facilities should also

14
provide debit cards or credit cards which are universally

accepted.

Business banking industry requires that the bank should

provide debit cards or credit cards to individuals offering the

maximum or optimum advantages as per the requirements of

the business banking holder.

Accepting payments by means of credit cards as well as debit

cards: One should furnish all the details of

one’s business to the bank offering business banking services.

One can avail of a card transaction system by fulfilling the

formalities with the bank. The risks involved in accepting

payments by plastic cards should be reckoned.

Paymentsonline:

If a business firm decides to accept payments through

the Internet, appropriate arrangements in accordance to

the banking norms are to be set up for carrying out transaction

on line.

Online transactions are more susceptible to fraud and one needs

to be extra careful if at all an online payment acceptance method

is opted for.

15
2. Indian scenario of banking industries

Banking in India originated in the last decades of the 18th

century. The first banks were The General Bank of India, which

started in 1786, and Bank of Hindustan, which started in 1790;

both are now defunct. The oldest bank in existence in India is the

State Bank of India, which originated in the Bank of Calcutta in

June 1806, which almost immediately became the Bank of

Bengal.

This was one of the three presidency banks, the other two being

the Bank of Bombay and the Bank of Madras, all three of which

were established under charters from the British East India

Company. For many years the Presidency banks acted as quasi-

central banks, as did their successors. The three banks merged

in 1921 to form the Imperial Bank of India, which, upon India's

independence, became the State Bank of India.

Indian merchants in Calcutta established the Bank of india in

1839, but it failed in 1848 as a consequence of the economic

crisis of 1848-49. The Allahabad Bank, established in 1865 and

still functioning today, is the oldest Joint Stock bank in India.

(Joint Stock Bank: A company that issues stock and requires

16
shareholders to be held liable for the company's debt) It was not

the first though.

That honor belongs to the Bank of Upper India, which was

established in 1863, and which survived until 1913, when it

failed, with some of its assets and liabilities being transferred to

the Alliance Bank of Simla.

When the American Civil War stopped the supply of cotton

to Lancashire from the Confederate States, promoters opened

banks to finance trading in Indian cotton. With large exposure to

speculative ventures, most of the banks opened in India during

that period failed.

The depositors lost money and lost interest in keeping deposits

with banks. Subsequently, banking in India remained the

exclusive domain of Europeans for next several decades until the

beginning of the 20th century.

Foreign banks too started to arrive, particularly in Calcutta, in

the 1860s. The Comptoire d'Escompte de Paris opened a branch

in Calcutta in 1860, and another in Bombay in 1862; branches

in Madras and Pondicherry, then a French colony,

followed. HSBC established itself in Bengal in 1869. Calcutta was

17
the most active trading port in India, mainly due to the trade of

the British Empire, and so became a banking centre.

The first entirely Indian joint stock bank was the Oudh

Commercial Bank, established in 1881 in Faizabad. It failed in

1958. The next was the Punjab National Bank, established

in Lahore in 1895, which has survived to the present and is now

one of the largest banks in India.

Around the turn of the 20th Century, the Indian economy was

passing through a relative period of stability. Around five decades

had elapsed since the Indian Mutiny, and the social, industrial

and other infrastructure had improved. Indians had established

small banks, most of which served particular ethnic and religious

communities.

The presidency banks dominated banking in India but there were

also some exchange banks and a number of Indian joint

stock banks. All these banks operated in different segments of

the economy. The exchange banks, mostly owned by Europeans,

concentrated on financing foreign trade.

Indian joint stock banks were generally undercapitalized and

lacked the experience and maturity to compete with the

18
presidency and exchange banks. This segmentation let Lord

Curzon to observe, "In respect of banking it seems we are behind

the times. We are like some old fashioned sailing ship, divided by

solid wooden bulkheads into separate and cumbersome

compartments."

The period between 1906 and 1911, saw the establishment of

banks inspired by the Swadeshi movement. The Swadeshi

movement inspired local businessmen and political figures to

found banks of and for the Indian community. A number of

banks established then have survived to the present such

as Bank of India, Corporation Bank, Indian Bank, Bank of

Baroda, Canara Bank and Central Bank of India.

The fervour of Swadeshi movement lead to establishing of many

private banks in Dakshina Kannada and Udupi district which

were unified earlier and known by the name South

Canara ( South Kanara ) district.

Four nationalised banks started in this district and also a leading

private sector bank. Hence undivided Dakshina Kannada district

is known as "Cradle of Indian Banking".

19
During the First World War (1914-1918) through the end of

the Second World War (1939-1945), and two years thereafter

until the independence of India were challenging for Indian

banking.

3. Position of all banking industry in India

Sr. Nationalized Deposits Advance Interest Net NPA

No bank s Income as %

Net

advances
1 Allahabad 84972 58802 7365 0.72

Bank
2 Andhra 59390 44139 5375 0.18

Bank
3 Bank of 192397 143986 15092 0.31

Baroda
4 Bank of India 189708 142909 16437 0.44
5 Bank of 52255 34291 4292 0.79

Maharashtra
6 Canara 186893 138219 17119 1.09

Bank
7 Central 131272 85483 10455 1.24

Bank of India
8 Corporation 73984 48512 6067 0.94

Bank
9 Dena Bank 43051 28878 3448 0.24
10 Indian Bank 72582 51465 6830 0.81
20
11 Indian 100116 74885 9641 1.33

Overseas

Bank
12 Oriental 98369 68500 8856 0.65

Bank of

Commerce
13 Punjab and 38766 24615 3247 0.32

Sind Bank
14 Punjab 209760 1541703 19326 0.17

National

Bank
15 Syndicate 115885 81532 9580 0.77

Bank
16 UCO Bank 100222 68805 8121 1.18
17 Bank of India 138703 96534 11889 0.34
19 United Bank 54536 35394 4312 1.48

of India
20 Vijaya Bank 54535 35468 5238 0.83

21
CHAPTER 3

1. About the bank:

Bank of India is firmly committed to consolidating and

maintaining its identity as a leading, innovative commercial

Bank, with a proactive approach to the changing needs of the

society. This has resulted in a wide gamut of products and

services, made available to its valuable clientele in catering to the

smallest of their needs. Today, with its efficient, value-added

22
services, sustained growth, consistent profitability and

development of new technologies, Bank of india has ensured

complete customer delight, living up to its image of, “GOOD

PEOPLE TO BANK WITH”. Anticipative banking- the ability to

gauge the customer's needs well ahead of real-time - forms the

vital ingredient in value-based services to effectively reduce the

gap between expectations and deliverables. The key to the

success of any organization lie with its people. No wonder, Bank

of india's unique family of about 26,000 qualified / skilled

employees is and ever will be dedicated and delighted to serve the

discerning customer with professionalism and wholeheartedness.

Bank of india is a Public Sector Unit with 55.43% Share Capital

held by the Government of India. The Bank came out with its

Initial Public Offer (IPO) in August 20, 2002 and Follow on Public

Offer in February 2006. Presently 44.57 % of Share Capital is

presently held by Institutions, Individuals and Others. Over the

years, the Bank has earned the reputation of being a techno-

savvy and is a front runner among public sector banks in

modern-day banking trends. It is one of the pioneer public sector

banks, which launched Core Banking Solution in 2002. Under

this solution umbrella,  All Branches of the Bank have been 1135

23
networked ATMs, with online Tele-banking facility made available

to all its Core Banking Customers - individual as well as

corporate. In addition to this, the versatile Internet Banking

provides extensive information pertaining to accounts and facets

of banking. Regular banking services apart, the customer can

also avail of a variety of other value-added services like Cash

Management Service, Insurance, Mutual Funds and Demat. The

Bank will ever strive in its endeavour to provide services to its

customer and enhance its businesses thereby fulfilling its vision

of becoming

“THE BANK OF FIRST CHOICE IN OUR CHOSEN AREA BY

BUILDING BENEFICIAL AND LASTING RELATIONSHIP WITH

CUSTOMERS THROUGH A PROCESS OF CONTINUOUS

IMPROVEMENT”.

2. Our Vision

To become the Bank of first choice in our areas by building

beneficial and lasting relationship with customers through the

process of Continuous improvement.

3. Mission

24
Our corporate mission to gain market recognition in chosen areas

by building effective strategies .A logical extension of the Vision

Statement is the Mission of the Bank, which is to gain market

recognition in the chosen areas .To build a sizeable market share

in each of the chosen areas of business through effective

strategies in terms of pricing, product packaging and promoting

the product in the market .To facilitate a process of restructuring

of branches to support a greater efficiency in the retail banking

field .To sustain the mission objective through harnessing

technology driven banking and delivery channels .To promote

confidence and commitment among the staff members, to

address the expectations of the customers efficiently and handle

technology banking with ease.

4. History

Bank of India was inaugurated by the Father of the Nation,

Mahatma Gandhi, on November 11, 1919. Started as a limited

company in Mumbai, it was one of the few Financial Commercial

banks in India. Until 1947, BOI had only 4 branches - 3 in

Mumbai and 1 in Saurashtra, all concentrated in key trade

centers. Catering to all the sectors of the society, be it

agriculture, industry, trade and commerce, services or

25
infrastructure, the bank has also played a major role in rendering

services to the financial needs of every section. Apart from this,

the bank also extended financial support to educational, housing

and trade sector. 

Bank of India undertook the task of establishment of village

knowledge centers and self-employment training centers. It was

in 1975, that the Bank of India was nationalized. It was, then,

that it merged with the Belgaum Bank, a private sector bank.

Another merger was on cards in 1985, this time with the Miraj

State Bank. Bank of india is a Public Sector Unit with 55.43%

Share Capital held by the Government of India. The Bank came

out with its Initial Public Offer (IPO) in August 20, 2002 and

Follow on Public Offer in February 2006. Presently 44.57 % of

Share Capital is presently held by institutions, individuals and

others. 

5. Products & Services

Deposits

Accounts

Loans

Cards

Insurance
26
Cash Management Service

Mutual Funds

Demat

ATMs

E Banking Or Online Banking

Remittance Service

Bill Payment Service

Tax Payment Service

Atm Banking

Tele Banking

Online Demat Trading

Cash Management Services(CMS)

Mutual Funds

Railway Tickets Booking

Public Provident Fund (PPF)

Direct Tax Collection

Central Excise and Service Tax Collection Services

Special Savings Schemes for Senior Citizens

27
CHAPTER - 4

1 . About the Branch:- IFB (Industrial Finance Branch)

There are 9 branches of Industrial Finance Branch (IFB) in Bank

of India, out of which two branches are located in Mumbai, one

at the head office at Nariman Point and the other at M. S. Marg

(MSM). IFB (MSM) was started in September, 2009. It is a

wholesale business unit which deals with only corporate clients.

28
The branch is headed by the Deputy General Manager (DGM) Mr.

P. M. Patel. IFB MSM deals with corporate having loan

requirement of Rs. 35 crores and above. Loans below Rs. 35

crores are provided by the Loans and Advances department.

IFB MSM provides all types of Credit facilities like Fund-Based

Credit and Non-Fund Based Credit. Fund-based credit includes

Cash Credit, Term Loan and Working Capital Loan. Non-fund-

based credit includes Letter of Credit, Letter of Guarantee and

Buyers Credit. Currently IFB provides Term Loans and Working

Capital Loans for the following projects:

 Infrastructure (Roads, Power, Ports, Telecom)

 Manufacturing (Steel, Aluminum)

 Textiles

 Traders (Import-Export)

Cash credit is a short-term cash loan to a company. Term loan is

a long-term loan provided for starting a new project or for the

modification, replacement or expansion of the existing unit.

Working Capital Loan is a short-term loan which the company

uses for running the day-to-day operations. Letter of Credit is a

letter from a bank guaranteeing that a buyer's payment to a

29
seller will be received on time and for the correct amount. In the

event that the buyer is unable to make payment on the purchase,

the bank will be required to cover the full or remaining amount of

the purchase. Letter of Guarantee, like a line of credit,

guarantees a sum of money to a beneficiary. Unlike a line of

credit, the sum is only paid if the opposing party does not fulfil

the stipulated obligations under the contract. This can be used to

essentially insure a buyer or seller from loss or damage due to

non-performance by the other party in a contract. Buyer's

credit is the credit availed by an Importer (Buyer) from overseas

Lenders i.e. Banks and Financial Institutions for payment of his

Imports on due date.

The branch also has an independent Foreign Exchange branch

which manages the non-fund based facilities. The branch deals

in acquiring the customers, getting limit sanctioned,

documentation and monitoring process.

Head Office

Bank of india Bhavan,

239, Vidhan Bhavan Marg,

Nariman Point,
30
Mumbai - 400 021.

Central Office

Bank of india Bhavan,

239, Vidhan Bhavan Marg,

Nariman Point,

Mumbai - 400 021.

Investor Services Division

Bank of india Bhavan,

239, Vidhan Bhavan Marg,

Nariman Point,

Mumbai - 400 021.

Registrar & Share Transfer Agent

Datamatics Financial Services Ltd.

Plot No.B-5, Part B, MIDC,

Crosslane, Marol, Andheri (East),

Mumbai - 400 093.

31
CHAPTER - 5

5. Bank of India CSR activities

 1. Karmayog 2008 CSR Rating:  3/5

Rural Development and Self Employment Training Institute

(RUDSETI) 

Established two RUDSETIs in our Lead Districts of Ernakulam

and Varanasi and a Rural Development Foundation at Alibaug,

Maharashtra, with the objective of raining youth in rural and

semi-urban areas to take up self-employment ventures, to

32
conduct various vocational and human resource development

training programmes, to provide consultancy services etc. 

Formation of Farmers' Clubs

Encouraging formation of Farmers Clubs in villages catered by

our rural branches.

2. Current year Corporate Social Responsibility

Bank of India is actively engaged in community and social

development and pursues this goal under the aegis of specially

set up ‘Bank of india Social Foundation’. Various activities are

carried out by this Foundation through a widespread presence of

202 Village knowledge Centres (VKCs), 103 Union Adarsh Gram, 8

Financial Literacy and Credit Counselling Centres (FLCC), 13 R-

SETIs (Rural Self-employment and Training Institutes) across the

country. This includes 1 VKC and 7 FLCC enduring the year.

Each VKC assists in overall development of the village by

coordinating with various developmental agencies/Government

departments and is semi ate nowledge to farmers about latest

33
developments in methods of cultivation, technologies, proper use

of fertilizers, pesticides etc.

Under Union Adarsh GramYojana, Bank undertakes a holistic

development of the village by converting it into a model village.

Similarly, R-SETI and FLCC extend financial literacy, counseling

and training to the needy people so that they become part of the

mainstreams. During the year 2010-11, Bank of India extended a

donation of ` 175.65 lakh to various entities for the purpose of

education, health and medical emergency, relief, basic amenities

etc. Bank of India is examining.

The possibility of providing the solar-powered lanterns to the

households in the103 Union Adarsh Gram. The objective is to

provide illumination to the electricity eprived villages that will

facilitate livelihood by increasing the productive hours for rural

entrepreneurs, help spread education, improve health, bio-

conservation and moreover, a ray of hope for everyone.

Bank of India is committed to its role as a responsible corporate

citizen by adopting ethical business practices and contributes to

34
economic development beyond its statutory obligation. The Bank

fully realizes its social responsibility to improve the quality of life

of the local community and society at large. The Bank has now

moved a step ahead in this direction. In order to pay a focused

attention, the Board of the Bank has decided to set apart 1% of

its annual public profits to undertake Corporate Social

Responsibility Activities through its trust named “Bank of india

Social Foundation”.

The trust would provide for infrastructure facilities in rural areas

and committed to undertaking one major project in each of the

13 lead districts across the country, namely, Ernakulam and

Idukki in Kerala, Varanasi, Ghazipur, Jaunpur,

Azamgarh,Chandauli, Bhadohi and Mau in U.P., Rewa and Sidhi

in M.P. and Samasthipur and Khagaria in Bihar.

The Bank has established Village Knowledge Centres (VKCs) in

nearly 200 villages across the country, which provides knowledge

dissemination and extension services to the rural community

helping them in improving their productivity. These VKCs are

non-profit entities, fully funded by the bank.

35
The Bank has also established two Rural Development and Self-

employment activities in Perambavur (Kerala) and Varanasi (U.P)

funded jointly by the Bank, NABARD and respective State

Governments.

CHAPTER - 6

6. Financial Position of Bank of India

As per annual report of 2009, 2010 & 2011

(In Thousands)

2009 2010 2011

Net profit 1,72,72,023 2,07,57,527 2,08,35,729
Income 13,37,19,30 15,27,74,192 18,49,13,987

36
6.1 Business Performance

a. Total Business of Bank of India increased by 22.04% from `

2,91,289 crore as on March 31, 2010 to 3,55,483 crore as on

March 31, 2011.

b. This comprised Deposit growth of 19.07% from 1,70,040 crore

to ` 2,02,461 crore and Advances growth of 26.20% from `

1,21,249 crore to 1,53,022 crore.

c. Bank has one branch outside India at Hong Kong. The

business of Hong Kong branch increased by 94.53%, though on a

lower base. Deposits increased from ` 370 crore to ` 570 crore

and advances increased from ` 2,977 crore to ` 5,941crore.

6.2 Financial Performance

a. Net Interest Income recorded a growth rate of 48.28% from `

4,192 crore for the year 2009-10 to ` 6,216 crore for the year

2010-11.

b. Total Income of the Bank increased by 21.04% from` 15,277

crore to ` 18,491 crore. Interest income was the major

37
contributor, within which interest on advances recorded a growth

of 24.08% from ` 9,696 crore to ` 12,031 crore. Interest income

on investments increased by 14.93% from ` 3,482 crore to ` 4,002

crore. Yield on advances stood at 9.86%for the year 2010-11 from

9.94% in the previous year. Yield on investments, however,

increased to 6.55%for the year 2010-11 from 6.32% in the

previous year, reflecting higher coupon on government securities.

Total yield on funds also recorded an improvement of 29 basis

points (bps) from 8.04% to 8.33%.

c. Non-interest income increased by 3.24% from` 1,975 crore to `

2,039 crore. The major drag was 19.02% fall in income from

profit on sale of investments due to volatile and uncertain market

conditions prevailing during the year. Excluding this item, non-

interest income growth would be 12.34%.

38
CHAPTER - 7

7. Current Strategies of Company

 A logical extension of the Vision Statement is the Mission of

the Bank, which is to gain market recognition in the chosen

areas.

 To build a sizeable market shares in each of the chosen

areas of business through effective strategies in terms of

pricing, product packaging and promoting the product in

the market.

39
  To facilitate a process of restructuring of branches to

support a greater efficiency in the retail banking field.

 To sustain the mission objective through harnessing

technology driven banking and delivery channels.

 To promote confidence and commitment among the staff

members, to address the expectations of the customers

efficiently and handle technology banking with ease.

Bank of India continued with the healthy performance track

record during the year 010-11 while pursuing its broad Vision &

Mission objective of becoming the Bank of first choice in chosen

areas. These objectives have short-term as well as long-term

goalposts. In the short-run, customer acquisition, business

expansion and a profitable growth are the key outcomes while in

the long-run Bank pursues a sustainable improvement in the

process efficiency, product enrichment and people productivity.

Our journey towards accomplishing the Vision involves creating

values for our customers, our employees and you, our

shareholders.

During the fiscal year 2010-11, the business environment was

not so benign; however, Bank of India reported healthy results.

40
Bank also launched two initiatives during the year, for achieving

customer service excellence and building a strong human capital

chain in the organization. These two initiatives, along with a

number of enablers created in the recent years would help Bank

of India become one of the most preferred banks amongst the

existing customer pool and the two emerging customer classes,

namely the Next Generation customers and new Bankable class.

Bank of India is laying a strong foundation for a sustainable

growth in the future that would enhance the market share and

shareholders’ value.

CHAPTER - 8

8. External Environment of the Company:

1. Swat analysis of Bank of India

Strengths

• Has been able to maintain healthy asset quality. In Q1 FY09,

Gross NPAs were 2.08% and Net NPAs were 0.15% with healthy

coverage ratio of 93.05%. BOI will continue to operate with Gross

NPAs of 2.00% with delinquency ratio below 1.00%.

41
• Very good cost to income ratio of 38% in FY08 as the bank has

managed to bring down and contain its costs significantly. Has

one of the best operating efficiencies in the banking sector space.

• Superior ROE (24.67% inFY08) and excellent ROAA (1.22%)

reflect high profitability of the bank.

• BOI has an excellent technological platform with 100% core

banking solution rollout and increased use of electronic mode in

transactions (12% of the total transactions). This helps the bank

reduce risk, improve efficiency and reduce costs significantly.

Weaknesses

• Higher interest rates are putting pressure on NIM, as the bank

is facing difficulty in passing on increasing cost of funds to its

customers.

• The bank has large exposure in AFS category in its investment

portfolio. In Q1, FY09, AFS consisted of 32.59% of the total

investment portfolio. Out of this, 55% (Rs.63 bn) is in bond

42
portfolio. Hardening of yields will require the bank to make

provisions for mark-to market (MTM) losses on its bond portfolio.

• CD ratio has reached 73.1% in FY08. It means the bank has to

rely on bulk deposits to finance advances growth.

Opportunities

• BOI still has a scope for improving its CASA, which is currently

at 34.76%. The bank has planned to achieve a CASA target of

40% by 2012.

• Increasing share of fee-based income in operating income

represents very good opportunity for the bank. The bank is

expecting its fee-based income to grow in excess of a CAGR of

30%.

• Opening of 400 new branches and expansion in the

international market by increasing its presence in 10 countries

with stress on Australia, Canada, Abu Dhabi and United

Kingdom

43
 Threats

• Rising interest rates coupled with slowdown in the economy

could result in higher

Delinquencies.

CHAPTER - 9

9. Marketing

1. Recovery of Credit

CODE FOR COLLECTION OF DUES AND REPOSSESSION OF

SECURITY 
I. Preamble: 

This Code for Collection of Dues And Repossession of Security (CDRS

Code), is a non-statutory code issued on voluntary basis. 

44
II. Applicability: 

This code will apply to Bank of India from 19th January 2004. 

III. Contents: 

• Introduction 

• Dues Collection Policy Statement 

• Security Repossession Policy Statement 

1. Introduction: 

Bank of India is committed to: 

• Following fair practices especially with regard to collection of dues

and repossession of security 

• Fostering customer confidence and long-term relationship. 

2. Dues Collection Policy Statement: 

• Dignity and Respect to Customers is Bank of India's Debt Collection

Policy and the Bank do not follow policies that are unduly coercive in

collection of dues. 

45
• Bank of India's dues collection policy is built on courtesy, fair

treatment and persuasion. 

3. Security Repossession Policy Statement: 

• Bank of India's Security Repossession Policy aims at recovery of

dues in the event of default and is not aimed at whimsical deprivation

of the property. 

• The Policy recognizes fairness and transparency in repossession,

valuation and realization of security. 

9.2 Grievance Redressal: 

Internal procedures 

a. Staff and the representives engaged for collection of dues and

repossession of securities will give assistance in the case

customer/borrower wishes to lodge a complaint. 

b. Within two weeks of receiving any complaint, we will send a written

acknowledgement. 

c. After examining the matter, we will send our final or other response

within eight weeks. 

46
CHAPTER - 10

10. Finance

1. Financial performance of Bank of India

Net Interest Income recorded a growth rate of 48.28% from ` 4,192

crore for the year 2009-10 to ` 6,216 crore for the year 2010-11.

Total Income of the Bank increased by 21.04% from ` 15,277 crore to

` 18,491 crore. Interest income was the major contributor, within

which interest on advances recorded a growth of 24.08% from ` 9,696

crore to ` 12,031 crore. Interest income on investments increased by

47
14.93% from ` 3,482 crore to ` 4,002 crore. Yield on advances stood at

9.86% for the year 2010-11 from 9.94% in the previous year. Yield on

investments, however, increased to 6.55% for the year 2010-11 from

6.32% in the previous year, reflecting higher coupon on government

securities. Total yield on funds also recorded an improvement of 29

basis points (bps) from 8.04% to 8.33%.

Non-interest income increased by 3.24% from ` 1,975 crore to ` 2,039

crore. The major drag was 19.02% fall in income from profit on sale of

investments due to volatile and uncertain market conditions

prevailing during the year. Excluding this item, non-interest income

growth would be 12.34%.

FY-10 FY-11 Growth%

Inland Commision 352 365 3.69

Treasury Income 573 464 -19.02
Income from Forex 323 429 32.82

Transaction
Recovery in Written - off 183 212 15.85

Accounts
Miscellaneous 544 569 4.60
Total 1975 2039 3.24
(In crore)

48
10.2 Listing in share market

The Bank is a Scheduled Commercial Bank with its Head Office at

Mumbai. The Bank has its presence in all parts of the country with a

network connected in All Branches.

The Bank’s shares are listed on the Stock Exchange, Mumbai and the

National Stock Exchange and its stock scrip code is as follows:- 

The Stock Exchange, Mumbai

532477
(BSE)
The National Stock Exchange, UNIONBANK-

(NSE) EQ

10.3 Table of share price for six months of Bank of India

49
10.4 CRISIL Rating for Bank of India

CRISIL ‘AAA’ for BANK OF INDIA’s Rs.5

Billion Upper Tier II Bonds Issue

Rs.5.0 Billion Upper Tier II

AAA/Stable (Assigned)
Bonds Issue
Tier I Perpetual Bond Issue
AAA/Stable (Reaffirmed)
Aggregating Rs.10.4 Billion
Upper Tier II Bond Issue
AAA/Stable (Reaffirmed)
Aggregating Rs.22.0 Billion
Lower Tier II Bond Issue
AAA/Stable (Reaffirmed)
Aggregating Rs.32.7 Billion
Rs.150 Billion Certificates of
P1+ Reaffirmed)
Deposit Programme

50
10.5 CHEQUE COLLECTION POLICY

 
POLICY ON COLLECTION OF CHEQUES/INSTRUMENTS

Arrangements for Collection:

Local Cheques

All cheques and other Negotiable Instruments payable locally

would be presented through the clearing system prevailing at the

centre. Cheques deposited at branch counters and in collection

boxes within the branch premises before the specified cut-off

time will be presented for clearing on the same day. Cheques

deposited after the cut-off time and in collection boxes outside

the branch premises including off-site ATMs will be presented in

the next clearing cycle. To avoid fraudulent transactions by

intercepting the cheque, customers should ensure that the

cheques deposited in collection boxes are specially crossed to

Bank of India. Instructions to this effect are displayed on the

Cheque.

In case of cheques deposited in all loans and advances accounts

51
including term loan value date credit will be given on Day-1 or

Day-2 as the case may be (that is the day on which settlement

account of the Bank with RBI/SBI is credited depending on

clearing cycle at the place) for limited purpose of calculation of

products for application of interest in all loan and advances

accounts including term loan.

Outstation Cheques

a) Cheques drawn on other banks at outstation centres will

normally be collected through bank’s branches at those centres. 

Where the bank does not have a branch of its own, the

instrument would be directly sent for collection to the drawee

bank or collected through a correspondent bank.  The bank

would also use the National Clearing services offered by the

Reserve Bank of India at centres where such collection services

exist.

b) Speed Clearing

Collection of outstation cheques, till now, required movement of

cheques from the presentation centre (city where the cheque is

presented) to Drawee Centre (city where the cheque is payable)

52
which increases the realization time for cheques.  Speed clearing

aims to reduce the time taken for realization of out station

cheques. Outstation cheque collection through collection basis

takes around one to two weeks time depending on the drawee

centre.  Under Speed Clearing, it would be realized on T+1 basis

viz., within 48 hours. 

Speed Clearing refers to collection of outstation cheques through

the local clearing.  It facilitates collection of cheques drawn on

outstation core banking enabled branches of banks, if they have

a net worked branch locally.

Cheques payable in Foreign Countries

The Bank handles the transactions relating to foreign cheques for

collection of their customers.

Foreign cheques will be sent for collection to the respective

centers where it is payable through our correspondent banks for

collection.  The realization depends upon the local clearing rules,

which vary from country to country and centre to centre. 

Immediate Credit of Local / Outstation Cheques /

53
Instruments:

Branches / extension counters of the bank will provide

immediate credit for outstation cheques / instruments up to the

aggregate value of Rs.15,000/- tendered for collection

by individual account holders subject to satisfactory conduct of

such accounts for a period not less than 6 months. In case of

prepaid instruments like DDs, Interest/ Dividend Warrants

drawn on our bank/branches and cheques issued by government

undertakings the maximum limit will be Rs.25,000/-.

The facility of immediate credit will be offered on Savings Bank /

Current / Cash Credit Accounts of the customers.  For extending

this facility there will not be any separate stipulation of minimum

balance in the account.

Higher limits will be given for immediate credit of cheques in the

form of bundled products upto Rs.25,000/- in all satisfactorily

operated Multi Gain Savings Accounts (MGSA) as the customers

maintain minimum balance of Rs.25,000/- in these accounts.

54
CHAPTER - 11

11. Operation and Production

1. Steps in term loan assessment

 Term Sheet

 Conducting feasibility study

 Credit report & Credit Rating

 Determination of Interest rate

 Proposal

 Compliance of sanction terms

 Disbursement

 Follow ups/ monitoring of the account

Term Sheet

Following a favourable feasibility check, credit rating the next

step is preparing term sheet. A Term Sheet is brief document that

provides details on aspects like:

 Account Details

 Financial highlights for immediate previous two audited

years and projection for proceeding year

 Nature of Project

55
  Cost of Project

 Means of finance

1. Nature of Facility

2. Purpose

3. Tenure of Term Loan

4. Interest rate Reset

5. Margin

6. Interest Rate, Commission

Door to Door Tenor i.e. the period within which the entire

amount is to be disbursed.

a)Repayment Terms

b) Prime Security

c) Collateral Security

d) Upfront fees i.e. the charges levied by the bank for processing

the documents.

Conducting feasibility study

56
The success of a feasibility study is based on the careful

identification and assessment of all of the important issues for

business success. A detailed Project Report is submitted by an

entrepreneur, prepared by a approved agency or a consultancy

organization. Such report provides in-depth details of the project

requesting finance. It includes the technical aspects, Managerial

Aspect, the Market Condition and Projected performance of the

company. It is necessary for the appraising officer to cross check

the information provided in the report for determining the

worthiness of the project.

Project Details:

 Definition of the project and alternative scenarios and

models.

 List the type and quality of product(s) or service(s) to be

marketed.

 Outline the general business model (ie. how the business

will make money).

 Include the technical processes, size, location, kind of

inputs

57
  Specify the time horizon from the time the project is

initiated until it is up and running at capacity.

 Relationship to the surrounding geographical area.

 Identifies economic and social impact on local communities.

 Identifies environmental impact on the surrounding area.

11.2 MARKET FEASIBILITY

 Industry description.

 Describes the size and scope of the industry, market and/or

market segment(s).

 Estimates the future direction of the industry, market

and/or market segment(s).

 Describes the nature of the industry, market and/or market

segment(s) (stable or going through rapid change and

restructuring).

 Identifies the life-cycle of the industry, market and/or

market segment(s) (emerging, mature)

 Industry Competitiveness.

 Investigates industry concentration (few large producers or

many small Producers)

 Analyzes major competitors.

58
 Explores barriers/ease of entry of competitors into the

market or industry.

 Determines concentration and competitiveness of input

suppliers and product/service buyers.

 Identifies price competitiveness of product/service.

 Market Potential.

 Identifies the demand and usage trends of the market or

market segment in which the proposed product or service

will participate.

 Examines the potential for emerging, niche or segmented

market opportunities.

 Explores the opportunity and potential for a "branded

product".

 Assesses estimated market usage and potential share of the

market or market segment.

 Sales Projection.

 Estimates sales or usage.

 Identifies and assess the accuracy of the underlying

assumptions in the sales projection.

 Projects sales under various assumptions (i.e. selling prices,

services provided).

59
 Access to Market Outlets.

 Identifies the potential buyers of the product/service and

the associated marketing costs.

 Investigates the product/service distribution system and the

costs involved.

11.3 ORGANIZATIONAL/MANAGERIAL FEASIBILITY

 Business structure.

 Outline alternative business model(s) (how the business will

make money).

 Identify the proposed legal structure of the business.

 Identify any potential joint venture partners, alliances or

other important stakeholders.

 Identify availability of skilled and experienced business

managers.

 Identify availability of consultants and service providers

with the skills needed to realize the project, including legal,

accounting, industry experts, etc.

 Outline the governance, lines of authority and decision

making structure.

60
Managerial Personnel

Managerial Personnel play a key role in directing the

working of the company. It is

Important for an organization to have a pool of efficient

personnel who bear the capacity to bail the company out

from crisis situation and work towards optimum utilization

of organizational resources. Such capacity of the personnel

can be determined by having complete details on following

key aspects:

 Market reputation on the promoter / management of the

company

 Hands on experience of the management personnel in the

industry / Business

 Managed by qualified personnel.

 Ability of the promoters / management to bail out the

company in case of crisis (for example, this could be derived

from a strong group company)

 Decision making – Is it concentrated?

 Organization structure / Succession planning / Labor

relations

61
 Is any group company in default / Any Directors on RBI’s

negative list / Borrower’s track-record in honoring financial

commitment

 Length of relationship with the bank

11.4 TECHNICAL FEASIBILITY

Technology plays an important role in maintaining a

competitive position in this highly competitive market

conditions. Investing in the proper technology is the key to

success it irrespective of size of business thus for achieving

its projected performance, it is important for it to have

sound technological background. Such technical

competence of the project can be determined by having

detailed study done on following key aspects:

 Determining Facility Needs.

 Estimates the size and type of production facilities.

 Investigates the need for related buildings, equipment,

rolling-stock

 Suitability of Production Technology.

 Investigates and compare technology providers.

62
 Determines reliability and competitiveness of technology

(proven or unproven, state-of-the-art).

 Identifies limitations or constraints of technology.

 Availability and Suitability of Location.

 Access to markets.

 Access to raw materials.

 Access to transportation.

 Access to a qualified labor pool.

 Access to production inputs (electricity, natural gas, water,

etc.).

 Investigate emissions potential.

 Analyze environmental impact.

 Identifies regulatory requirements.

 Explores economic development incentives.

 Explores community receptiveness to having the business

located there.

 Raw materials.

 Estimates the amount of raw materials needed.

 Investigates the current and future availability and access

to raw materials.

63
  Assesses the quality and cost of raw materials and markets

of easily substituted

 inputs.

 Other inputs.

 Investigates the availability of labor including wage rates,

skill level, etc.

 Assesses the potential to access and attract qualified

management personnel.

11.5 FINANCIAL FEASIBILITY

 Estimate the total capital requirements.

 Assesses the capital needs of the business project and how

these needs will be met.

 Estimates capital requirements for facilities, equipment and

inventories.

 Determines replacement capital requirements and timing for

facilities and equipment.

 Estimates working capital needs.

 Estimates start-up capital needs until revenues are realized

at full capacity.

64
 Estimates contingency capital needs (construction delays,

technology malfunction, market access delays, etc.

 Estimates other capital needs.

 Estimated equity and credit needs.

 Identifies alternative equity sources and capital availability

-- producers, local investors, angel investors, venture

capitalists, etc.

 Identifies and assess alternative credit sources -- banks,

government (ie. direct loans or loan guarantees), grants,

local and state economic development incentives.

 Assesses expected financing needs and alternative sources

-- interest rates, terms, conditions, covenants, liens, etc.

 Establishes debt-to-equity levels.

 Budgets expected costs and returns of various alternatives.

 Estimates expected costs and revenue.

 Estimates the profit margin and expected net profit.

 Estimates the sales or usage needed to break-even.

 Estimates the returns under various production, price and

sales levels. This may involve identifying "best case",

"typical", and "worst case" scenarios or more sophisticated

analysis like a Monte Carlo simulation.

65
 Assesses the reliability of the underlying assumptions of the

financial analysis (prices, production, efficiencies, market

access, market penetration, etc.)

 Creates a benchmark against industry averages and/or

competitors (cost, margin, profits, ROI, etc.).

 Identifies limitations or constraints of the economic

analysis.

 Determines project expected cash flow during the start-up

period.

 Identifies project an expected income statement, balance

sheet, etc. when reaching full operation.

 After the feasibility study has been completed and

presented, a carefully study and analysis the conclusions

and underlying assumptions. And deciding which course of

action to pursue:-

 Potential courses of action include:

 Choosing the most viable business model, for investment

 Identifying additional scenarios for further study.

 Deciding that a viable business opportunity is not available

and moving to end the business assessment process.

66
11.6 Credit report & Credit Rating

The credit report is an important determinant of an individual's

financial credibility. They are used by lenders to judge a person's

creditworthiness. They also help the person concerned to narrow

down on the financial problem areas. Credit report is a

document, which comprises detailed information about the credit

payment history of an applicant. It is mostly used by the lenders

to determine the credit worthiness of an applicant. The business

credit reports provide information on the background of a

company. This assists one to take crucial business related

decisions.

People can also assess the amount of business risk associated

with a company and then decide whether they would be

comfortable in providing them with credit facilities. The degree of

interest that would be shown by investors in their company can

also be gauged from the business credit reports as they can get

an idea of the conception of their customers regarding

themselves. Since these records are updated at regular intervals

of time they enable people to identify the risk levels associated

with a business as well as its future.

67
What Is A Corporate Credit Rating?

Ratings can be assigned to short-term and long-term debt

obligations as well as securities, loans, preferred stock and

insurance companies. Long-term credit ratings tend to be more

indicative of a country's investment surroundings and/or a

company's ability to honor its debt responsibilities. . Bank of

India follows a finely defined Credit Rating Model for assessing

the creditworthiness of the applicant. The credit rating model

asses various aspects of the projects and assigns scores against

them thereby determining the risk level involved with the project.

It is divided in Five Sections:

1. Rating of the Borrower

Financial Risk

Management Risk

2. Market Condition/ Demand Situation

3. Rating of the Facility

4. Business Consideration

5. Cash Flow related parameters

68
CHAPTER - 12

12. Personal and HR department

1. Recruitment

Written examination

Personal interview

2. Training and development

Bank of india has one of the best training systems in India. The

training experience here goes back to over four decades.

Presently the training structure consists of the Staff College at

Bangalore, and seven centers in various parts of the country. The

training is designed, delivered and assessed, based on systems

suggested and put in place by our overseas consultants M/s.

Vinstar Limited (AGL Group) of New Zealand. These systems have

been tested and refined by practical application. 

The training system of Bank of india has been awarded the

prestigious Golden Peacock National Training Award instituted

by the Institute of Directors, New Delhi for the best training

system in the Country.

69
In our pursuit of achieving higher standards we have further

upgraded our systems and sized up to 'international norms'.

After a rigorous audit, in February 2001, the College is awarded

ISO 9001 certification (for Design and Development of

Customised Training Programs) by Det Norske Veritas, of the

Netherlands. We are the only Bank to obtain ISO certification for

the training system. 

THE 'FACILITATORS' 

Our 'facilitators' to learning - "Faculty" or "Trainers" in the

common parlance- are experienced bank officers with many years

of exposure in the entire gamut of banking. All the facilitators

have been through an intensive orientation program on adult

learning processes drawn up by Vinstar of New Zealand. They are

also exposed periodically to updating of skills and awareness in

leading institutions in the country. Some have also been

nurtured with professional training abroad at premiere

institutions like Columbia Business School, New York and the

Manchester Business School, England. 

THE PROGRAMS 

Currently the College is running training programs in the

following disciplines: 1.International Banking

70
2.Credit

3.Information

Technology

4.General Banking

5.Marketing and

6. Management and human resource development. 

Bank of india is also organizing executive education programs in

association with Icfian Business School - an arm of the Institute

of Chartered Financial Analysts of India, Hyderabad. In this

stream following programs are offered:

1.Finance for Non-Finance executives

2.Treasury and forex management

3.Software- project management

4.The Service edge - improving service quality 

71
12.3 Performance appraisal forms of Bank of India (IFB)

CHAPTER - 13

13. MIS or IT Department

1. Workflow for Information system in Bank of India (IFB)

72
13.2 Application of Software & Hardware

73
CHAPTER - 14

14. Other Aspects of Bank

74
1. Awards/ certifications received by the Bank

Year Award and Recognition

National Award for the second best performance in

2006 financing small scale units by Ministry

of Small Scale Industries, Government of India

Golden JBOIlee Award for the best bank in north east

zone for excellence in the field of

2007
khadi and village industries from the Ministry of MSME,

Government of India

2007-
Best Bancassurance partner byTata AIG
2008
National Award for the best bank for excellence in field

of Khadi and village industries for

2008
east and north east zones from the Ministry of MSME,

Government of India

2008-
Pinnacle Partner of the year by Tata AIG
2009
2008-
Highest contributor to lives insured by Tata AIG
2009

75
 National Award under Prime Minister Employment

2009 Guarantee Programme in north east

zone from the Ministry of MSME, Government of India

CHAPTER - 15

15. Problems or Issues in Bank of India IFB

As per the industrial finance branch

 low man power

 low incentives

 lack of promotions

 lack of training

76
  limitation on innovative work

The Bank of India recruit the MBA professional in every year in

their IFB but the people are normally seen that they live their job

after one or two year experience it will affect the productivity of

the IFB work. However the IFB is one of the finest job providers

to the MBAs but the people are take knowledge of the all finance

activity and joined another institution. Because of the low level of

salary as compare to another company like CRISIL etc.

The IFB must provide the proper incentives for their employees

for their innovative work. In the IFB there is lack of promotion for

the new employees. Training are provided by senior most

employees but it not sufficient for the new joined employee it

dimities the work of new employee.

The Bank of India (IFB) is one of the finest finance providers to

the government project through the private and public

partnership. Their work load is more as compare to other banks.

So Bank of India must recruit the people in their crew of

employee.

77
The chain of command is also affecting the decision of the IFB.

So the command system o the company must be change as per

the quality of the employee and their work.

We work in IFB on the POWER PROJECT the aspect of the power

project finance and work done on “OPPORTUNITIES IN POWER

SECTOR AND ITS CREDIT VIABILITY” in this we learn the

how the finance institution are provide finance for this sector.

The Bank of India is providing the finance in three main sectors

like PORT, POWER, and ROAD projects. The decision on the

investment on which sector the power sector comes last this

thinking of invest in power sector is negative. The company must

have changed their policy on this they have to check the growth

of every sector and take investing decision.

CHAPTER - 16

Solutions of problem and issues

 The Bank of India must have changed their policy of

remuneration.

78
 They must have provided the proper incentives to employee

as per their performance appraisal.

 Company must provide the task oriented work to their

employees and give the proper opportunity to the work

innovative manner and quality work.

 They must provide the training for at list 2 months for new

employees and give the real work experience.

 Company must develop the recruitment procedure for the

new employee’s recruitment. Make examination of the

finance aspect of the company the examination question are

ask on finance field which are mostly come in the original

work on IFB.

 They have to cheek whether the employee are capable for

the IFB work he must have knowledge regarding project

finance.

79
CHAPTER -17

Recommendations

As per the Bank of India IFB

80
OPPORTUNITIES TO BANKS to Invest on POWER SECTOR

 The Indian Power Industry is one of the largest and most

important industries in India as it fulfills the energy

requirements of various other industries. It is one of the

most critical components of infrastructure that affects

economic growth and the well-being of our nation.

 India has the world’s 5th largest electricity generation

capacity and it is the 6th largest energy consumer

accounting for 3.4% of global energy consumption. Due to

the fast-paced growth of the Indian economy, the country’s

energy demand has grown at an average of 3.6% p.a. over

the past 30 years.

 As per the latest Report of CEA (Central Electricity

Authority) as on 31-03-2011, the Total Installed Capacity of

Power in India is 173626.40 MW. Of this, more than 75% of

the installed capacity is with the public sector (state and

central), the state sector having the largest share of 48%.

 The nation’s power sector which is already struggling with

funding shortfalls will need $400 billion of investment

during the 12th plan period (2012-17). Power generation

capacity requires current estimation of Rs. 10.31 trillion of

81
 investment, whereas power ministry estimates a Rs. 4.51

trillion funding shortfall.

 In India, major proportion of power is generated from

thermal sources where the main raw material used is coal.

Around 83% of thermal power is generated using coal as a

raw material whereas 16% of thermal power is generated

with the help of Gas and 1% of thermal power is generated

with the help of Oil.

 Hydroelectric power or hydroelectricity is electrical power

which is generated through the energy of falling water. India

has hydro power generation potential worth 1,50,000 MW,

of which only 25 % has been harnessed till date.

 Under the Government’s “Power for all by 2012” plan, it has

targeted per capita consumption of 1000 kWh by the end of

the 11th Five Year Plan (2007-2012) as compared to levels

of 734 kWh in 2008-09. In order to provide per capita

availability of over 1000 kWh of electricity by year 2012, it is

estimated that capacity addition of more than 1,00,000 MW

would be required. This shows that huge capacity additions

are required at good efficiency rates, indicating that the

opportunities available in this sector are huge.

82
 A future CARG of 15% is considered based on which loans

and advances of AIFI’s(All India Financial Institutions) are

projected to reach Rs. 19,307,132crore by F.Y.2012.

 A modest growth of 15 % in the aggregate deposits would

entail additional funds of Rs.2,995,202 crore till F.Y. 2012.

 As far as regulation is concerned, Electricity Act, 2003 is a

very important Act as it allowed private sector participation

in the generation of power, thus creating competition. It also

allowed 100% FDI participation in the power generation,

transmission and distribution, thus inducing investments in

the power sector.

 The Government of India is planning nine Ultra Mega Power

Projects (UMPP) of 4 GW each with an estimated individual

investment of US$ 4 billion (Rs. 192 billion). Four of these

projects are expected to be commissioned between 2011 and

2017. The UMPP is an initiative by the government to

collaborate with power generation companies to set up

4,000 MW projects to ease the country’s power deficit

situation.

 Nuclear power projects account for 2.75% of India’s total

installed capacity which is about 4.77 GW. The Planning

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 Commission’s expert committee on an Integrated Energy

Policy has suggested in its report that there is a possibility

of reaching a nuclear power capacity of 21-29 GW by 2020

and 48-63 GW by 2030.

 The hydro power segment offers investment opportunities as

India is considered to have hydro power generation potential

worth 1,50,000 MW; of which only 25% has been harnessed

till date

Power Sector is a highly capital-intensive industry with long

gestation periods, before the commencement of revenue

generation. Since most of projects have a long time frame (4-5

years of construction period and operating period of over 25

years). And from the above future prospects of power industry

shows a heavy investment requirement and a untapped

opportunities to banks and other financial institutes to invest

heavily in power sector.

The Ministry of Power, Government of India has launched an

initiative for development of coal-based Ultra-Mega Power

Projects (UMPPs) in India, each with a capacity of 4,000 MW or

above. These projects will be awarded to developers on the basis

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of tariff based competitive bidding. To facilitate tie-ups of inputs

and clearances, project-specific shell companies have been set up

as wholly owned subsidiaries of the Power Finance Corporation

(PFC) Ltd. These companies will undertake preliminary studies

and obtain necessary clearances including water, land, fuel,

power selling tie-up etc. prior to award of the project to the

successful bidder.

Nine sites have been identified by CEA in nine States for the

proposed UMPPs. These include four pithead sites, one each in

Chhattisgarh, Jharkhand, Madhya Pradesh and Orissa, and five

coastal sites, one each in Andhra Pradesh, Gujarat, Karnataka,

Maharashtra and Tamil Nadu. It is proposed to set up pithead

projects as integrated proposals with corresponding captive coal

mines. On the request of Ministry of Power, Ministry of Coal has

already allocated captive coal mining block for Sasan UMPP in

Madhya Pradesh and earmarked captive coal mining block for

Orissa UMPP. For the coastal projects, imported coal shall be

used. The projects are to be developed with a view to lower the

cost of power to the consumers. These projects, adopting

supercritical technology to reduce emissions, would be

environment-friendly.

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A time bound action plan for preparation of project report, tie-up

of various inputs / clearances, appointment of consultants,

preparation of RFQ/RFP have been prepared.Lanco

Infrastructure has bagged the Sasan Project at Rs. 1.19 per unit

whereas Tata Power has been awarded the Mundra project at Rs.

2.26 per unit. The encouraging result achieved in these two cases

has shown the way forward for capacity addition with most

competitive tariff.

CHAPTER - 18

Learning

 Work on project finance of the bank

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 How the banks are finance the project of government

through the Private and Public Partnership.

 Company analysis through the balance sheet and the brake

up of balance sheet of various power companies like TATA,

BHEL, Reliance power.

 Company working on the projects how power projects are

financed by the banks with the consortium.

 Analysis of various power companies capacity to generate

power and their working (POWER PLANT visit in dahanu

Reliance DTPS )

 Operation in power companies. Their working conditions

and process, a component requires.

 How generate the Thermal Power.

 Analysis of power sector in India.

 Why bank make investment in power sector

 Public Private Partnership

 How consortium take place in banks to invest in power

projects of India.

 Analysis of power purchase agreement.

 Credit viability in power sector.

 Demand and supply scenario of power sector.

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  How the loan assess in Bank of India.

 How the credit rating provided to companies by Bank of

India.

 Each sectors opportunities like ROAD, POWER, PORT.

MAJOR FINDINGS:

Most of the SEBs though are supported by state

government, are running under loss. This is because of

power theft, transmission losses, use of conventional

methods for power generation and transmission and out

dated management policies.

Indian power sector has been witnessing a wide demand –

supply gap. Although electricity generation has increased

substantially, it has not been able to meet the demand.

India is going to build an additional capacity of 1 lakh MW

by 2012 including private sector contribution.

In a bid to bring structural transformations, necessary

reform programs should be carried out in distribution and

transmission process.

India possesses a vast opportunity to grow in the field of power

generation, transmission, and distribution. The target of over

150,000 MW of hydel power germination is yet to be achieved. By

88
the year 2012, India requires an additional 100,000 MW of

generation capacity. A huge capital investment is required to

meet this target. This has welcomed numerous power generation,

transmission, and distribution companies across the globe to

establish their operations in the country under the famous PPP

(public-private partnership) programmes. The power sector is still

experiencing a large demand-supply gap. This has called for an

effective consideration of some of strategic initiatives. There are

strong opportunities in transmission network ventures -

additional 60,000 circuit kilometers of transmission network is

expected by 2012 with a total investment opportunity of about

US$ 200 billion.

CHAPTER - 19

Bibliography

WEBSITIS

 http://en.wikipedia.org/wiki/Banking_in_India

89
  www.moneycontrol.com/.../20Bank%20Company

%20Report1.pdf 

 http://www.bankofindia.co.in/au_corporate_mission.aspx

 http://spoonfeedin.blogspot.com/2008/09/mktg--bank-

brand-refresh.html

 http://www.bankofindia.co.in/shareholdinginformation1.as

px

 http://www.crisil.com/Ratings/RatingList/RatingDocs/ban

k_18jun10.htm?cn=bofindia

 http://www.bankofindia.co.in/au_training_system.aspx

 http://www.bankofindia.co.in/bcsbi.aspx

 http://www.bankofindia.co.in/greivance_mach.aspx

NEWS PAPER & MAZINES:

 The Hindustan Times.

 The business world & economy

 E- governance ( feb.2016)

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 The Times of india

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