INDUSTRY PROFILE

HISTORY AND GROWTH OF THE INDUSTRY:

The banking system is an integral part of the financial sector of our country. Therefore, the role of banking in our economy must be seen in the context of its fundamental role in the entire financial sector. The financial sector plays a major role in mobilization and allocation of savings. Financial institutions, instrument and markets which constitutes the financial sector act as a conduit for the transfer of financial resources from net savers to the net borrowers, i.e. from those who spend less than they earn more than they spend. The financial sector performs the basic economic function of intermediation essentially through four transformation mechanisms. Liability asset transformation: It means that accepting deposits as a liability and converting them in to assets such as loans Size transformation: i.e. providing large loans on the basis of assorted large medium and small deposits. Maturity transformation: i.e. offering savers deposits according to their liability preferences while providing borrowers with loans of required maturities.

Origin of banking
The word Bank has been originally derived from the Italian word 'Banco' meaning a bench. In olden days money lenders used to exhibit the coins of different countries on a separate bench and the business of exchanging the coins were carried on through those money lenders, especially in Greece, Italy and England. Whenever these moneylenders were not in a position to convert the currency of one country into the currency of another, people virtually broke up their benches. Hence, the word 'Bankrupt'. The word Bank has also originated from German word 'Bank', meaning thereby a joint-stock fund, collected from public for the purpose of financing the needy people.

Evaluation of banking in India

Banking is known in India since ancient times. It originated in our country as early as 600 B.C. References are found in the early Vedic literature of deposits, pledges, loans and rates of interest. However, banking in those days consisted mainly of money lending activities. Commercial banking of modern lines was started in India only during the nineteenth century. Earlier in British India, mainly the employees at the East India Company established banks and they were called the Agency Houses. It is these 'Agency houses' which paved the way for the establishment of Joint Stock Bank to be established in India. The Bank of Hindustan was the first Joint Stock Bank to be established in India under European Management. But soon it failed. Later three Presidency Banks were started with financial position of the Government. These Banks were the Bank of Bengal, The Bank of Bombay and the Bank of Madras. The Commercial Bank was perhaps the first purely Indian Joint Stock Bank to be established in 1889. Later the Punjab National Bank in 1894 and the people Bank in 1901 were established. The Swadeshi Movement in 1905 gave a real stimulus to the development of Indian Bank. The Bank of India was started in 1906, the Indian Bank in 1907, the Bank of Baroda in 1908 and the Central Bank of India in 1 9 1 1 . However, the banking arises of 1913 hit hand many of the banks. In 1922 the banking industry witnessed many bank failures. It is only in recent years, such bank failures have been prevented and stability restored. In 1935, the Reserve Bank of India, which is acting as the Central Bank of our country, was established.

Banking system in India

The Banking system plays an important role in the economic development of the country. Indian Banking system is characterized by the present of wide variety of institutions. At the top of the banking systems there is the Reserve Bank of India which is the Central Bank of our country. There are 22 Public Sector Banks in India. The Banking scene is dominated by Public Sector Banking. "Nearly the Public Sector Banking controls 25% of banking resources of the country. Two more apex institutions in the field of agriculture and exports respectively have also been established.

They are the NABARD (National Bank for Agriculture and Rural Development) and EXIM Bank (Export Import Bank of India). In the sphere of Industrial Finance, we have specialized financial Institutions such as 1FCI, IBRD, ICICI, SFC and SDC. Agriculture finance is provided by Cooperative Banks and Regional Rural Banks.

HISTORY OF CO OPERATIVE BANKING IN INDIA.

The Beginnings The Co-operative movements was started in India in 1904 with the object of providing finance to agriculturists for productive purpose at low rates of interest and thereby relieving them from the clutches of the money lenders. A large number of agricultural credit Societies were set up in the villages under the Co-operative Societies Act of 1904. The Co-operative Societies Act of 1912 contributed to the establishment of Central Co-operative Banks and the State Cooperative banks to provide refinance to primary credit societies which could not mobilize funds by their own efforts. It gave stimulation to the co-operative credit movement in India. The Co-operative credit movement made good progress during and after the First World War of 1914-1918. But during the great depression of 1929-1933 it received a serious setback with the outbreak of Second World War between 1939-1945. The Co-operative Credit movement made considerable progress once again. By that time, the Co-operative Credit institutions had increased their membership had gone up and their deposits and advances also had increased considerably. Since then the progress had been maintained thanks to the keen interest shown by the Reserve Bank of India in the co-operative Credit movement.

MEANING OF CO-OPERATIVE BANKING

A CO-OPERATIVE BANK is a co-operative organization engaged in the banking functions of acceptance of deposits and lending credits. The Co-operative banks and Societies perform an important role in meeting the requirements of people in the rural areas Co-operative banks and district entities by

themselves with separate jurisdictions and independent board of directors. The Co-operative banks are organized on a Cooperative basis and one governed by their members according to the Co-operative laws. They are under the control of respective State government certain provisions of the banking regulation act also applied to co-operative banks in India are federal in their structure

AIMS OF CO-OPERATIVE BANKS

To promote savings among members and thereby increase the supply of funds. To tap outside sources for the supply of funds. To promote the effective use of credit and to reduce the risk in the granting of credit. To reduce the cost of management through the honorary services.

MERITS OF CO-OPERATIVE BANKING:

Co-operative banks play a very significant role in rural banking. The significant role of cooperative banks is owing to the following reasons Co-operative banks have a rural touch They are familiar with the rural problems They have attitudinal! identification with rural economy The cost of operation of co-operative banks is relatively low Co-operative Banking has thought the agriculturist to borrow at the right time in right amount and for right purposes. Co-operative banking is widely accepted as the only means of eradicating poverty and realizing the standard of living of rural masses

Recent Developments
Over the years, primary (urban) cooperative banks have registered a significant growth in number, size and volume of business handled. As on 31st March, 2009 there were 1,721 UCBs of which 53 were scheduled banks. About 64.8percent of these are located in three states - Gujarat, Karnataka, and Maharashtra (including Goa). Recently the problems faced by a

few large UCBs have highlighted some of the difficulties these banks face and policy endeavors are geared to consolidating and strengthening this sector and improving governance .

Co-operative banking in India

Co-operative banking in India has made substantial progress in dissemination of banking services based on co- operative principles. In view of the special thrust on financial inclusion, co-operative banking has acquired renewed significance in the Indian financial system. The focus of the recent policy measures, therefore, has once again shifted to the strengthening of cooperative banking in India. The review of the problems of rural cooperatives by the Task Force (2004) constituted by the Government of India and the Vision Document on urban co-operative banks (UCBs) released in March 2005 by the Reserve Bank, have provided a fresh framework with practical and implement able arrangements to rejuvenate the Indian co-operative banking structure. The emphasis of the recent initiatives has been to revitalize these institutions for reinstating the confidence of the public in the co-operative banking system. While designing the regulatory and supervisory framework, care is being taken to preserve their co -operative character and institutional specifics. The co-operative banking structure in India comprises two main components, viz., urban cooperative banks and rural co-operative credit institutions. While urban co-operative banks have a single tier structure, rural cooperatives have a complex structure. Rural cooperative credit institutions have two distinct structures, viz., the short-term co-operative credit structure (STCCS) and the long-term cooperative credit structure (LTCCS). Within the STCCS, primary Agricultural credit societies (PACS) at the village level form the base level, while district central Co-operative banks (DCCBs) are placed at the intermediate level, and the State co operative banks (STCBs) at the apex level. The STCCS mostly provide crop and other working capital loans primarily for a short period to farmers and rural artisans. The long-term structure of rural co-operatives comprises State co-operative agriculture and rural development banks (SCARDBs) at the State level, and primary co-operative agriculture and rural development banks (PCARDBs) at the decentralized district or block level. These institutions focus on providing typically medium to long-term loans for making investments in agriculture, rural industries, and lately housing. The structure of rural co-operative banks is not uniform across the

States of the country, and varies significantly from one State to another. Some States have a unitary structure with the State level banks operating through their own branches, while others have a mixed structure incorporating both unitary and federal systems. Given the significant role played by urban co-operative banks in providing banking services to the middle and lower income people, the Reserve Bank continued to take initiatives to strengthen these banks. In June 2004, it was decided not to issue fresh licenses for setting up new banks or for opening new branches, until a suitable framework for regulation and supervision was put in place for the existing UCBs. In March 2005, the Reserve Bank prepared a draft Vision document for UCBs which, inter alia, discussed the problems of the sector and highlighted the issue of dual regulatory mechanism which restricted the ability of the Reserve Bank in handling the weaknesses of entities in the sector. In order to address the problem of dual control, Vision document proposed the adoption of a consultative approach for deciding the future set up of weak and sick banks in each State. In terms of the Vision document, the Reserve Bank approached the State Governments for signing MOU to ensure greater convergence of approach of the two agencies entrusted with the regulation and supervision of UCBs. As part of the MOU, it was decided to set up State level Task Force for Co-operative Urban Banks (TAFCUBs) comprising representatives of the Reserve Bank. State Government and federation/association of UCBs. The TAFCUB was entrusted to identify the potentially viable and non viable UCBs in the State and provide a revival path for the former and anon-disruptive exit route for the latter set of banks. The exit route could include merger/amalgamation with stronger banks, conversion into societies or ultimately as a last resort, through liquidation. Till 2009, MOUs have been signed with 26 State Governments and Central Government (in respect of multi -State UCBs), which encompass 1,721 UCBs, i.e., 99 per cent of the UCBs representing 99.2 per cent of deposits of the sector. The impact of the initiatives in the recent past is perceptible as there is enhancement of public confidence in the sector which is reflected in the increase of deposits during 2006-07 and 2005-06, reversing the declining trend of 2004-05.

TYPES OF CO-OPERATIVE BANKS Structure of Co-operative Credit Institutions in India

Co-operative Credit Institutions

Urban Co-operatives Banks

Rural Co-operative Credit Institutions

Scheduled UCBs

Non-Scheduled UCBs

Short-Term

Long-Term

Multi State

Single State

State Co-operative Banks

Multi State

Single State

District Central Cooperative Banks

Primary Agricultur al Credit Societies

PCARDBs Single District Multi District

SCARDBs

Unit UCBs

Non-Unit UCBs

SCARDBs: State Co-operative Agriculture and Rural Development Banks. PCARDBs: Primary Co-operative Agriculture and Rural development Banks.

The following are the steps taken by the Government of India to regulate Banking Institutions in the country: 1949: Enactment of Banking Regulation Act. 1955: Nationalization of State Bank of India. 1960: Nationalization of SBI Subsidiaries 1961: Insurance cover extended to deposits. 1969: Nationalization of 14 major banks. 1971: Creation of credit guarantee corporation. 1975: Creation of regional rural banks. 1980: Nationalization of seven banks with deposits over 200crores.

In third new phase of Indian banking with the advent of financial and banking sector reforms, introduced many more products and facilities in the banking sector. In 1991. Under the chairmanship of M.Narasimham, a committee was set up by his name which worked for liberalization of banking practices. The country is flooded with foreign banks and their ATM stations. Efforts are being put to give a satisfactory to customers.

COMPANY PROFILE
Co-operative sector has a long history of more than a century. In the co-operative movement, Agriculture Credit sector has acquired a special importance in order to avoid the exploitation of poor farmers from the middlemen and money lenders and to provide suitable assistance to the eligible farmers. As our Nation is basically an agricultural country, Agricultural credit system plays an important role in the development of this sector. Through this system, the credit sector is extending helping hand to the farmers in its own way to boost the agricultural production in the State in particular and in the Country at large. KSC Apex Bank over the ninety six years, since its inception has always come forward to extend its assuring hand to the state through District Central co-operative Banks, Primary Agricultural co-operative Credit system. Besides the Bank is providing the needed financial assistance, for development of Human Resources, Training, Computerisation and all other encouragement from time to time to the DCC Banks and PACS.

BACKGROUND AND INCEPTION OF THE COMPANY

The Karnataka state co-operative Apex Bank limited has been playing a very significant role in the dispensation of production, credit to the farmers. It is to the credit of Karnataka, that the first co-operative credit institution in the entire country was established way back in the year 1904 in a village called Kanginahal now at Gadag district. Primary Agriculture Credit Society (PACS) at the village level federated later to District Central Co-operative Banks (DCCBs) at the district level. These DCC banks federated themselves at the state level to form Apex Bank. The Karnataka State Co-operative Bank was established in the year 1915 and the late VaradarajaIyengar has been its founder president. It made a humble beginning with a working capital of Rs 1.26 lakhs as deposits. Over 96 years since its inception, it has played a crucial role in the development of agricultural credit structure in Karnataka. The bank is having a network of 40 Branches in Bangalore City. As on 31.03.2011 working capital stands at Rs.7291.48crores with a Deposit base of Rs.4646.67crores.The bank earned 35.50 Crores. Apex bank is a pioneer in agriculture finance and activities. Apex bank is ranked as one of the premier state co-operative banks in the country. The main objectives of the bank are to serve

the farmers in the state by providing short term and long agricultural loans, general banking business and function as a leader of the co-operative banks in the state.

NATURE OF BUSINESS
The business carried by the bank is generally related with providing short term and long term agricultural loans. It also accepts deposits from the public. Apex bank also provides loans to processing, marketing and consumer co-operative as well as sugar factories in Karnataka and working capital loans to state and national level institutions.

VISSION:
As a state co-operative bank, Apex bank shall be a dominant financial institution in the state, leading the state to economic prosperity. They shall be the model of an effective, protective, dynamic and financial sound organization, respectively to state goals and aspirations. They shall maintain highly trained and motivated professionals committed to the highest standards of ethics and excellence. They shall contribute to building progressive and standards of cooperative societies in the service of farmers and rural mass.

MISSON:
Ensuring the best quality of life and success of farmers, primary agricultural Co-operative Societies, District Central Co-operative Banks, clients and employees. For Farmers:

Apex Bank shall continue to improve their socio-economic status through timely financial agricultural activities support for agricultural activities.

For Clients: protective and

Apex Bank shall deliver innovative and advance products and services in effective manner to meet their local demands. For PACS and DCC Banks:

Apex banks shall ensure mutual co-operation and complement action to achieve optimum gains in an environment of trust and confidence. For Our Employees:

Apex Bank shall ensure a work atmosphere of mutual respect and teamwork within by a system of recognition and regards. Banks shall continue to provide appropriate training and value enhancement to ensure the highest degree of professionalism and integrity. Apex Bank shall hold our organization composed of highly competent people driven by superior technology. For the People of Karnataka: Apex Bank commits our unwavering loyalty and dedicated service in the pursuit of state interest.

QUALITY OBJECTIVE:
To serve as a state co-operative bank and as a balancing centre in the state of Karnataka for registered co-operative societies. To raise funds by way of deposits, loans, grants donations, subscription, subsidies etc. for financing the members by way of loans, cash credits, overdrafts and advances. To develop, assist and coordinate the members DCCBs and other co-operative societies and secure financial assistance for them. To arrange/ hold periodical co-operative conferences of the DCCBs and other members of the bank and to take action for the growth and development of the co-operative credit movement. Financing of short-term loans to seasonal agricultural operation and marketing of crops repayable within one year.

Advancing Cash credit loans to meet working capital for processing. Marketing and consumer co-operative including co-operative Sugar Factories in Karnataka.

Advancing medium term loans for development of agricultural infrastructure such as irrigation, diary poultry, plantation, and gober gas under schematic lending.

Sanctioning working capitals to the State Level Co-operative, National level Cooperatives and public sector undertakings through consortium arrangements.

Sanctioning advances to the non-form sector to develop cottage Industries, small-scale industries and rural artisans.

Functioning as a scheduled bank, transacting all types of banking business such as remittances of funds, by demand drafts, issue of credit and guarantees.

Rendering services to customers through computerized accounts. Supporting the primary agricultural credit societies under the business development programme and District central co=operative Banks under the development plan.

Providing loan facilities like consumers durable loan, computer loan, jewel loan and safe deposit locker facilities to the customers of the bank.

OBJECTIVES OF THE KSC APEX BANK LTD.

The main aims and objectives of the Bank defined in the Bank Bye Law No. III are given below . To serve as a State Co-operative Bank and as a balancing center in the State of Karnataka for registered co-operative societies; To raise funds by way of deposits, loans, grants, donations, subscriptions, subsidies etc. for financing the members by way of loans, cash credits, over-drafts and advances; To develop, assist and co-ordinate the member DCCBs and other Co-operative Societies and secure financial assistance for them; To arrange/hold periodical Co-operative Conferences of the DCCBs and other members of the bank and to take action for the growth & development of the Co-operative Credit Movement.

To participate in financing Co-operative and other institutions who are members of the bank, directly or through consortium of Bankers; To participate in the schematic lending and to provide loans for which refinance facility is available with term lending institutions. To arrange for the inspection and supervision of the affiliated DCCBs and other Cooperative Societies and guide them in their working; To buy and sell securities for the legitimate investment of surplus funds and act as agents for buyers and sellers of securities of Central/State; To carry on general business of Banking and other banking activities to the members and customers; To purchase, acquire or raise or otherwise obtain moveable or immoveable property for the own use of the Bank and also to dispose them of when not required; To take measures to help Co-operative Education; To promote and undertake Co-operative Research and Co-operative Development; To manage, sell or release any property which may come into the possession of the bank in satisfaction of or part satisfaction of any of its claims; To promote economic interest of the members of the Bank in accordance with the principles of Cooperation. To do such other things as are incidental or conducive to the promotion and advancement of the business of the Bank;

PRODUCT/ SERVICES PROFILE:

The Karnataka state co-operative Apex Bank Limited provides following services to the societies: Financing of Short Term Loans for Seasonal Agricultural Operations and for Marketing of Crops. These loans are repayable within one year. During the year 2010-11, Apex Bank has disbursed total loans of Rs.4033.32 Crores of which Rs. 2707.91 Crores for Agricultural Purposes and Rs. 1325.41 Crores for Non-Agricultural Purposes. Advancing Medium Term Loans for the development of agricultural infrastructure such as Lift Irrigation, Dairy, Poultry, Plantations, Gobar Gas, etc., under schematic lending. Providing Cash Credit Loans to Processing, Marketing and Consumer Co-operative as well as Sugar Factories in Karnataka and also Term Loans to sugar factories under consortium arrangements. Advancing Working Capital loans to State level Co-operatives like MARKFED, KCCF and to the National Level Co-operatives such as IFFCO and KRIBHCO. The Bank provides similar facilities to Public Sector Undertakings like Food Corporation of India through consortium arrangements with Commercial Banks and at times directly. The Bank extends finance to Non-farm Sector and for the development of cottage Industries, Small Scale Industries and Rural Artisans and Weavers. It is a Scheduled Bank in all respects including remittances of funds by Demand Draft, Mail Transfers, Collection of Cheques and Drafts

SERVICES PROVIDED BY THE BANK IN DETAIL:

Short term loans: Financing of short term loans for seasonal agricultural operations and for marketing of crops, these loans are repayable within one year. Medium term loans: These loans area sanctioned for agricultural purpose and non-agricultural purpose. Kissan credit card schemes/loan: Kissan credit card aims at providing timely and adequate credit support to farmers for their cultivation including investment credit needs in a flexible and cost effective manner. All DCC banks in the state have implemented the kissan credit scheme. Credit facilities to self help groups: All the DCCBs have taken keen interest in the formation of self help groups in coordination with PACS. Self help groups mobilize their savings and avail facilities from DCCBs and PACS. Advancing medium term loans with economic development: These loans are advanced for the agricultural infrastructures such as lift irrigation, diary, poultry, plantation; Gobar gas etc. that constitutes schematic lending. Cash credit loans: Providing cash credit loans to processing marketing and consumer co-operatives as well as sugar factories in Karnataka and also term loans to sugar factories under consortium agreement. Working capital loans: Advancing working capital loans to state level co-operatives like CAMPCO, MARKFRED, and KCCF and to the national level co-operatives like IFFFCO and KRIBHCO. The bank provide similar facilities to public sector undertakings like Karnataka Silk Marketing Board,

Karnataka Handloom Development Corporation, Karnataka Small Scale Industries Development Corporations, Food Corporations of India directly and also through consortium arrangements through commercial banks. Collection of Cheques and Drafts: The bank extends to the non-farm sector and to the development of cottage industries, small scale industries and rural artisan wavers. It is a scheduled bank in all aspects including remittance of funds, demand drafts, mail transfers, collection of cheques and drafts. Loans through various schemes: Such as: Housing loans for Construction, Site Mortgage loans, Professional loan, Vehicle loans, Housing loans, Commercial Vehicle loan , Instalment loans, Jewel loans, Instalment loans, Apex Personal, Apex cash, Apex Education, Apex Travel, Apex Rent, Apex BDA, Apex Bank , Apex Overdraft, Apex Retail, Apex Women, Apex Self Employment, Apex Gold, Apex Pension, Other loans. Personal Banking: Apex bank provides the following deposit schemes to the customers: Fixed Deposits: In this account, the customer deposits money period up to 10 years. Current Deposits: In this type, the individuals or businessmen operate. This account is kept open for the entire day. The customer can make any number of deposits and withdrawals in a day during business hours. Saving Bank Deposits: In this deposit, the low income class groups and marginal customer deposits the money. Insurance Scheme in collaboration with Oriental Insurance Company:

Apex Gold SB Account Fire/Earthquake Insurance Vehicle Insurance

E-Stamping Facility: Bank has introduced E-Stamping facility through our Branches. The Apex Bank conducts Training Programmes through its own institution viz., Agricultural Co-operative Staff Training Institute at Padmanabhanagar to cater to its own staff as well as the employee of DCC Banks and Primary Agricultural Co-operative Societies. The Bank has set up some special funds like the Farmers welfare Fund, Special Assistance Fund, Rural Farmers Social-Economic Development fund, Co-operative Development Fund etc. for extending assistance to member Banks and to the Primary Agricultural Credit Co-operative Societies. Computerization of Branches :The Banking transactions in all the Branches and Central Office have been computerized under TBA(Total Branch Automation) module and also in the process of bringing under Tele Banking, Mobile/SMS Banking, Any Branch Banking, Internet banking. We are planning to switch over to CBS(Core Banking Systems)shortly. Safe Deposit Locker facility is available in our branches.

AREA OF OPERATION:
Apex bank works in the regional level only. It does not work in national level. The area of operation covers the entire Bangalore. It has 40 branches in Bangalore and head quarter is situated in Chamarajpet. The branch offices of bank are adequately delegated with power of sanction of disbursements. If the loans are to be provided up to 10 lakhs it is handled by concerned branch offices but if it is more than 10 lakhs then it is handled by concerned branch offices but if it is more than 10 lakhs then it is handled by main branch. BRANCHES AT BANGALORE: Head office Branch - Chamarajpet.

Ashoka pillar.

Jayanagar Market complex Jayanagar 9th Clock J.P.nagar

Ganganagra

M.S Building

Banashankari Basaveshwaranagar

Padmanabhanagar Mahalakshipuram Public Utility Building Vyalikaval

Girinagar Gokula Gandhinagar Agara-HSR Layout Indiranagar

Kalpathru super Bazaar Koramangala Kengeri Satellite Town Lakkasandra Magadi Road

Rajajinagar R.P.C Layout Vijayanagar VidhanaSoudha Legislators Home

Chandra Layout Vivekanada College R.T Nagar Shivajinagar R.T.Nagar

Sunkadakatte T.Dasarahalli Banashankari 3rd Stage

Krishnarajpuram B.T.M layout

Yelhanka Rajarajeshwari Nagar

Bommasandra Mahadeva Pura

OWNERSHIP PATTERN:
The bank classifies its shareholders into 6 types such as A, B, C, D, E and F class. The face value of shares under each class is different from others. A class shares are alone having the Voting Rights. B, C, and D classification have an option to participate in Company Meeting. E category shares are the shares held by the members other than A, B and D classification. F classification is very general type since it doesnt have Voting Rights and participation in Company Meetings, but the face value of shares in this category is less compared to others.

SHARE CAPITAL Classification summary as on 31-03-2011 Classification Sl.NO 1 2 3 4 Type A DCC Banks B KSUBF C State Government D State & national level cooperative institutions other than B 5 E Co-operative institutions other than A, B, D 6 F Associate/Nominal members Total 44 117 9,246 24,55.799 11,12,90,000 91,25,67,700 11 16,207 16,20,600 No. of members 21 1 0 40 Face value of shares 23,66,436 1,50,000 1,00,000 67,934 Shares Amount 79,28,00,000 1,50,000 0 67,07,100

For sanctioning of loan from the bank, each member has to keep some fixed percentage of loan amount in the shares of the Bank. For Cash Credit 1%, for Agriculture Loan 2.5%, for Non-Agriculture Loan 5% has to be kept in shares of the Bank.

COMPETITORS INFORMATION:
The major competitors are: Land Bank (agricultural based finance), Amanath Scheduled Co-operative Bank, Sham RoaVittal Co-operative Bank, Commercial Banks, Small Industrial Service Institution, Small Industries Development Bank of India, Corporate Banks, Some local Co-operative Banks.

INFRASTRUCTURAL FACILITIES:
The new administrative building at a around Rs.800 lakhs completed in 2002 provides additional impetus to a new culture and new mind set of all. The gigantic building with granite caddied facade having circular and rectangular columns suggesting strengths and stability reflects the character of the organization. This four storied block caters mainly to the administrative requirements of the bank along with hi-tech banking hall on the ground floor. The architects M/s Zechariah consultants effectively conceptualize the vision of the corporate head office floated by the Directors of the Board. The built up area of UTHUNGA HAS BEEN 67,820 Sq. ft. the civil cost has come to Rd. 888 per sq. Ft. And interiors all inclusive worked out at Rs.357 per sq. Ft. The believe that their members are always behind them not only to encourage but also to guide them in case they go wrong. They are grateful to them. Similarly they are grateful to the Government of Karnataka, RBI, NABARD and all other sister co-operative in the state for what they are today.

ACHIEVEMENT/ AWARDS:
1) Bank is able to lend 75% of the farmers in the state and it covers all sugar factories in Karnataka. 2) Apex Bank is habituated to get awards at National levels year after year. Similarly. NABARD has been giving best performance award and even PACS have not have logged behind in getting National recognition. All DCC banks and merely 80% of PACS have proved themselves to be financially viable. 3) In the history of Apex Bank 9 new branches have been opened at a time in different localities of Bangalore City i.e., BSK 3rd stage, Sunkadakatte, K.R. Puram, Mahadeva pura , Bommasandra, BTM layout , Rajarajeshwarinagar, Yalahanka and T.Dasarahalli. 4) A Micro Finance department has been established in the bank for proper monitoring of micro finance scheme to SHGs. 5) A loan of Rs. 110-00 Crores has been issued to weaves & fishermen under government loan scheme of 3% interest. 6) E-stamping facility has been implemented in our branches. 7) RTGS and NEFT System has been implemented for speedy transfer of funds and upgraded as per RBI instructions. 8) They have entered in to an agreement with Oriental Insurance Company Ltd., and introducing various insurance products in our Bank and also arranged group insurance scheme for the Savings Bank account holders.

WORK FLOW MODEL (End to End)

Filing the loan application Processing the loan application Accepting as a customer (need sure from existing customer) Collecting of required loan fees Opening of account Seeking eligibility criteria

Forwarding application to the branch manager Sanctioning loan by the branch manager Recovery of interest plus principle If borrower fails to pay Interest with principle Every month (up to 3 months) Then bank will treat as NPA

Work flow in KSC Apex Bank Ltd. Through different Departments: 1) Central financing agency 2) Accounts and Operation

3) Planning and development 4) Banking 5) Administration 6) Development Action Plan 7) Statistics 8) Branch Control 9) Inspection and audit

FUTURE GROWTH AND PROSPECTS

1. It is proposed to implement ATM facility initially at Head Office Branch, Vidhana Soudha Branch, Legislators Home Branch, M.S. Building Branch, and

Basaveshwaranagar Branch. 2. It is proposed to convert the existing TBA module in to core banking solution system in all branches and Head office of Bank. 3. We have intended to open our branches in all district head quarters in the state. In the 1st phase it is proposed to open 4 branches in 4 divisional head quarters. 4. We have proposed to construct the branch buildings in the Bangalore city on our own 6 sites. 5. It is proposed to implement uniform dress code to our staff members 6. We have intended to recruit middle level officers posts through direct recruitment in order to bring professionalism in our bank.

Special activities of the Bank

The bank has expanded its activities and offers all types of services to its customers growth in deposits as well as loans and advances has led to appreciable rise in profitability from year to year. It has now built up a strong capital base and is ranked as one of the premier state Co-operative bank in the country. The bank offers prompt customer service. Nearly 40% of loans have gone to weaker sections/SC/ST and agricultural labours The Apex Bank is one of the 1st state Co-operative banks which have introduced computerization. The Apex bank runs its training programmes in its own institutions named the Agricultural Co-operative Staff Training Institute (ACSTI) at padmanabhanagar to cater its own staff as well as the employees of DCC banks and primary agricultural Cooperative societies.

MCKINSEYSS 7S FRAME WORK

The red one are hard Ss

The purple one are soft Ss

ORGANIZATION STRUCTURE
BOARD OF MANAGEMENT President (1) Vice president (1) Directors (20) Managing Director (IAS) Secretary (JRCS)

CGM (A&D)

CGM (F&A)

GM (P&D)

GM (ACSTI) Manager Faculties Clerk/steno, Attenders

GM (I&A) DGM (I&A) AGM (I&A) Managers AsstManagers

GM (Banking)

DGM (P&D) AGM (Sr.KT) Managers AsstManagers Clerk/Steno

DGM (DAP) Managers AsstManagers Clerk/Steno Attenders DGM (A&O) AGM (A&O) Managers AsstManagers Clerk, steno, Attenders

Clerk/Steno Attenders

DGM (Funds) Managers AsstManagers Clerk, steno, Attenders

DGM (CFA) AGM (A&O) Managers AsstManagers Clerk, steno, Attenders

DGM (BC) Managers AsstManagers Clerk, steno, Attenders

BOARD OF DIRECTORS
Sri R.M Manjunantha Gowda, president and there are 25 Board of Directors including president.

ORGANIZATIONAL STRU CTURE:

1. Human Resources section
2. Head office section 3. Planning and development section 4. Accounts and Operation 5. Central Financing agency 6. Clearing section 7. Inspection and Auditing 8. Crediting Department 9. Working capital Financing

1. HUMAN RESOURCE SECTION This section is a part of planning and development department. This section providing Loans to staff Members, like Housing loans, Vehicle loans, Consumer Durable loans, Secured loans against Government securities, Festival advances,

2. HEAD OFFICE SECTION This section deals directly with the customer. It has various types of deposits and loan schemes.

Deposits Interest on deposits

Saving bank

4.00% P.A

TERM DEPOSIT RATE OF INTEREST FOR DEPOSITS EFFECT FROM 24/05/2011 SL.NO PERIOD OF DEPOSITS Rate of Interest 1 15 Days to 45 Days 5.00% 2 46 Days to 90 Days 5.75% 3 91 Days to 179 Days 8.00% 4 180 Days to Less than one Year 8.50% 5 1 Year, Above & Less than 2 Years 9.75% 6 2 Years and Above 9.50% Additional 1% interest is paid for staff and ex-staff accounts. 0.50% more interest is paid for Senior Citizen. Additional 0.50% interest is paid for Individual deposits of Rs. 15.00 Lakhs & above, invested at a time for a period of one year & above. 3. PLANNING AND DEVELOPMENT SECTION Under this department there are five sections and they are a. Engineering b. Development Action Plans c. Administration d. Statistics e. Legal cell

4. ACCOUNTS AND OPERATION SECTION The primary activity of this section is to sanction to the customers who have applied for it and it deals with investing the surplus funds of the bank. The main activities are. Giving advances to the district central co-operatives banks (DCC) Borrowing from NABARD Investments: the surplus funds of the bank can be invested in various ways.

5. CENTRAL FINANCING AGENCY

The main functions of this department are to provide housing loans, short term seasonal agricultural operations, medium term loans, cash credit.

6. CLEARING SECTION Karnataka State Co-operative Apex Bank limited has 40 branches of its own and 65 submembers. The clearing section will clear the cheques by either payment or by receiving money.

STAFF:
CADRE CGM GM DGM CHIEF STATCIAN AGM SR.KAN.TRNSLTR(AGM) MANAGER ASST.MANAGER JR.KAN.TRNSLTR(CLERK) CLERKS/CASHEIR ST.WRITERS ATTENDERS FIREMEN TOTAL Duties:CLASS A OFFICERS: They are there to guide the fellow officers. These officers are the head of the departments. The Managing Directors, Executive Directors are at highest level. SANCTIONED 2 4 12 1 18 1 75 114 1 204 11 126 1 570 WORKING 2 0 6 0 18 1 74 95 0 135 4 89 1 425 VACANCY 1 4 6 1 0 0 1 19 1 69 7 37 0 146

CLASS B OFFICERS: The class B officers are there for performing various functions of the organization. The officers look after the functions like treasury functions, legal functions and internal audit etc..

CLASS C- other subordinate staff: These officers are responsible to implement the function which is given by the bosses. The lower level officers have to perform the commanded task of their department. The bank has a unique combination of its professional on its payrolls charted accountants, M.com, lawyers, Engineers, and graduates etc. Thus the diversity of its Human Resources is one of the important assets of the bank. Bank follows a typical selection procedure. As a first step, advertisement is given as and when it is required. The test is conducted and the candidate made to go through interview which is being conducted by the top management board. It consists of subject expert from different department. Bank provides on the job and off the job training as per requirements.

STYLE:
Bank follows a top down participative style of management. It believes in team work. For each task teams are constituted to attain specific goals. Apex band believes that quality can be achieved by providing quality financial and related services on a continuous basis. In order to motivate the employees, it encourages them to actively participate in setting organization growth targets, objectives and to take their own decisions at various levels. By this type of participative style the bank can conflict their rivals like land bank, Amanath Scheduled Co-operative Bank,

SYSTEM:
The bank has a specified department for its MIS. This department is solely responsible for providing update information of all branches, all departments etc required by the management time to time on continuous basis as and when required. MIS Department In the first floor of the apex bank head office. MIS department is located. This department helps in the flow of information by the means of various software networking techniques. Performance Appraisal This is also known as order executive. In this system employees can watch over their

performance level and required level during the process of transfer, promotion, demotion, this system has helped better performance of work.

Attendance system This system is very popular system for the purpose of maintaining attendance. Everyone is using this technique for the attendance of their employees. This system is called swapping system. In this system the employees have their own ID card and during their entrance to the bank they swipe their card and mark their attendance. This system saves time and money.

STRATEGY:
Apex bank in one of the pioneers in this industry in providing short term loans and long terms loans to farmers and medium scale industries. As a part of its marketing studies it makes its advertising through newspapers, leading television channels and focus over quality certificate. The following are the strategies used by Apex Bank to compete with its rivals. Business Developments This is a strategy in which existing customers are attracted. This strategy follows the

entrepreneur recognitions like that of penny sectors, and then attracting with various schemes. Identify needs This is also one strategy of Apex Bank which is used to identify the actual needs of the market. This will help the band to cover the demands of the markets by coming with various schemes and this organization has succeeded in knowing the consumer demands.

SKILLS: The banks require different skills for different types works at different levels. Highly qualified professionals in the bank have major skills like technical, finance, economical and public relation skill. The bank also looks for the development of their staff skills. The various programs organized by Apex for this purpose could be classified into in house and outside. On the job training The bank has the internal job training by means of guidance by their senior staffs. The bank also provides the on job training like: 1. Group assignment over some project 2. Job rotation 3. Under supervision works Off the job training

1. In house training: this job training is done at ACSTI, padmanabha Nagar with residual facilities. 2. There are various programs performed as off the job training in Bangalore. The training provided is classified as 1. Communication skill training. 2. Computer skills 3. Project skills 4. Secretarial skills

SHARED VALUES: A shared value is satisfying the farmers and small and medium scale industries first. Mission the Apex bank is committed to continuously nurture, develop and service the small sector thought the need based products and services. The value that the bank upholds most is Farmers Satisfaction. This bank focuses over their farmers and industrial demands and wants. They also come up with various schemes like housing loans, vehicle loans.

SWOT ANALYSIS
SWOT is the acronym for strength. Weakness, opportunities and threats. Strengths are the internal. Positive characteristics that the company processes. One look at this competitive advantage. Weaknesses are internal as well and are the negative aspects of the company and indicate competitive vulnerabilities. These should be distinguished from problems such that immediate collapse is not likely. Weakness should be overcome in order to achieve future growth and success. Opportunities are external and provide areas of growth and improvement of the company. Threats are external to the company and action is required

SOWT ANALYSIS

INTERNAL SOURCE

EXTERNAL SOURCE

STRENGTH

WEAKNESSWEA KNESS

OPPURTUNITY OPPURTUNITY

THREATS

STRENGTHS:
Rural development and priority Has the support of government in its functioning It is an open, proactive, team based and learning organization Experience in the field of banking for about 9 decades Profits, advances, reserves of title bank are increasing. Repayment period is very flexible Wide range of schemes One of the co-operatives banks in India Due to co operative in nature people have faith in bank. Have well equipped, modernized and growth oriented staff training institute (ACSTI) for the staff working co-operative sector. Have good network base of DCC Bank and PACS in Karnataka as compared to other state.

WEAKNESS:
Government culture in the organization Functions as per Act It operates only in the regional level only Lack of advertising

Procedural difficulties regional operation Too many policies bound.

No permission to have NRIs accounts, mutual funds, foreign exchange. slow pace of technology application Lack of scientific and professionalized management.

OPPORTUNITIES:
Introduce internet and mobile banking Mutual funds Insurance Advising on the investment Raising of capital from all sources. Introduce innovative services through its R&D programmes.

THREATS Fail to provide updated facility to their customers Too many competitors There are too many commercial banks, Which provides funds at lower internet rates, which can be big threats for apex bank Government policies.