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Industry profile

Banking sector. A bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities: A central bank circulates money on behalf of a government and acts as its monetary authority by implementing monetary policy, which regulates the money supply. A commercial bank accepts deposits and pools those funds to provide credit, either directly by lending, or indirectly by investing through the capital markets. Within the global financial markets, these institutions connect market participants with capital deficits (borrowers) to market participants with capital surpluses (investors and lenders) by transferring funds from those parties who have surplus funds to invest (financial assets) to those parties who borrow funds to invest in real assets. A savings bank (known as a "building society" in the United Kingdom) is similar to a savings and loan association (S&L). They can either be stockholder owned or mutually owned, in which case they are permitted to only borrow from members of the financial cooperative. The asset structure of savings banks and savings and loan associations is similar, with residential mortgage loans providing the principal assets of the institution's portfolio. Because of the important role depository institutions play in the financial system, the banking industry is highly regulated, and government restrictions on financial activities by banks have varied over time and by location. Current global bank capital requirements are referred to as Basel II. In some countries, such as Germany, banks have historically owned major stakes in industrial companies, while in other countries, such as the United States, banks have traditionally been prohibited from owning non-financial companies. In Japan, banks are usually the nexus of a crossshare holding entity known as the " keiretsu". In Iceland, banks followed international standards of regulation prior to the recent global financial crisis that began in 2007. The oldest bank still in existence is Monte dei Paschi di Siena , headquartered in Siena, Italy, which has been operating continuously since 1472. A Bank's main source of income is interest. A bank pays out at a lower interest rate on deposits and receives a higher interest rate on loan s. The difference between these rates represents the bank's net income. History Banking in the modern sense of the word can be traced to medieval and early Renaissance Italy, to the rich cities in the north like Florence, Venice and Genoa. The Bardi and Peruzzi families dominated banking in 14th century Flor ence, establishing branches in many other parts of Europe.[3] Perhaps the most famous Italian bank was the Medici bank, set up by Giovanni Medici in 1397. The earliest

known state deposit bank, Banco di San Giorgio (Bank of St. George), was founded in 1407 at Genoa, Italy. Origin of the word The word bank was borrowed in Middle English from Middle French banque, from Old Italian banca, from Old High German banc, bank "bench, counter". Benches were used as desks or exchange counters during the Renaissance by Florentine bankers, who used to make their transactions atop desks covered by green tablecloths. One of the oldest items foun d showing money-changing activity is a silver Greek drachm coin from ancient Hellenic colony Trapezus on the Black Sea, modern Trabzon, c. 350325 BC, presented in the British Museum in London. The coin shows a banker's table (trapeza) laden with coins, a pun on the name of the city. In fact, even today in Modern Greek the word Trapeza ( ) means both a table and a bank. Definition The definition of a bank varies from country to country. See the relevant country page (below) for more information. Under English common law, a banker is defined as a person who carries on the business of banking, which is specified as: conducting current accounts for his customers paying cheques drawn on him, and Collecting cheques for his customers. . In most common law jurisdictions there is a Bills of Exchange Act that codifies the law in relation to negotiable instruments, including cheques, and this Act contains a statutory definition of the term banker: banker includes a body of persons, whether incorporated or not, who carry on the business of banking' (Section 2, Int erpretation). Although this definition seems circular, it is actually functional, because it ensures that the legal basis for bank transactions such as cheques does not depend on how the bank is organised or regulated. The business of banking is in many English common law countries not defined by statute but by common law, the definition above. In other English common law jurisdictions there are statutory definitions of the business of banking or banking business. When looking at these definitions it is important to keep in mind that they are defining the business of banking for the purposes of the legislation, and not necessarily in general. In particular, most of the definitions are from legislation that has the purposes of entry regulating and supervising banks rather than regulating the actual business of banking. However, in many cases the statutory definition closely mirrors the common law one. Examples of statutory definitions:

"banking business" means the business of receiving money on current or deposit account, paying and collecting cheques drawn by or paid in by custome rs, the making of advances to customers, and includes such other business as the Authority may prescribe for the purposes of this Act; (Banking Act (Singapore), Section 2, Interpretation). "Banking business" means the business of either or both of the foll owing: receiving from the general public money on current, deposit, savings or other similar account repayable on demand or within less than [3 months] ... or with a period of call or notice of less than that period; Paying or collecting cheques drawn by o r paid in by customers Since the advent of EFTPOS (Electronic Funds Transfer at Point Of Sale), direct credit, direct debit and internet banking, the cheque has lost its primacy in most banking systems as a payment instrument. This has led legal theorists to suggest that the cheque based definitio n should be broadened to include financial institutions that conduct current accounts for customers and enable customers to pay and be paid by third parties, even if they do not pay and collect cheques. Banking Standard activities

Banks act as payment agents by conducting checking or current accounts for customers, paying cheques drawn by customers on the bank, and collecting cheques deposited to customers' current accounts. Banks also enable customer payments via other payment methods such as telegraphic transfer, EFTPOS, and automated teller machine (ATM). Banks borrow money by accepting funds deposited on current accounts, by accepting term deposits, and by issuing debt securities such as banknotes and bonds. Banks lend money by making advances to customers on current accounts, by making installment loans, and by investing in marketable debt securities and other forms of money lending. Banks provide almost all payment services, and a bank account is considered indispensable by most businesses, individuals and governments. Non -banks that provide payment services such as remittance companies are not normally considered an adequate substitute for having a bank account. Banks borrow most funds from households and non -financial businesses, and lend most funds to households and non -financial businesses, but non -bank lenders provide a significant and in many cases adequate substitute for bank loans, and money market funds, cash management trusts and other non-bank financial institutions in many cases provide an adequate substitute to banks for lending savings too.[clarification needed]

Channels Banks offer many different channels to access their banking and other services: ATM is a machine that dispenses cash and sometimes takes deposits without the need for a human bank teller. Some ATMs provide additional services. A branch is a retail location Call center Mail: most banks accept check deposits via mail and use mail to communicate to their customers, e.g. by sending out statements Mobile banking is a method of using one's mobile phone to con duct banking transactions Online banking is a term used for performing transactions, payments etc. over the Internet Relationship Managers, mostly for private banking or business banking, often visiting customers at their homes or businesses Telephone banking is a service which allows its customers to perform transactions over the telephone without speaking to a human Video banking is a term used for performing banking transactions or professional banking consultations via a remote video and audio connection. Video banking can be performed via purpose built banking transaction machines (similar to an Automated teller machine), or via a videoconference enabled bank branch. Clarification Business model A bank can generate revenue in a variety of different ways including interest, transaction fees and financial advice. The main method is v ia charging interest on the capital it lends out to customers. The bank profits from the differential between the level of interest it pays for deposits and other sources of funds, and the l evel of interest it charges in its lending activities. This difference is referred to as the spread between the cost of funds and the loan interest rate. Historically, profitability from lending activities has been cyclical and dependent on the needs and s trengths of loan customers and the stage of the economic cycle. Fees and financial advice constitute a more stable revenue stream and banks have therefore placed more emphasis on these revenue lines to smooth their financial performance. In the past 20 years American banks have taken many measures to ensure that they remain profitable while responding to increasingly changing market conditions. First, this includes the Gramm-Leach-Bliley Act, which allows banks again to merge with investment and insurance houses. Merging banking, investment, and insurance functions allows traditional banks to respond to increasing consumer demands for

"one-stop shopping" by enabling cross -selling of products (which, the banks hope, will also increase profitability). Second, they have expanded the use of risk-based pricing from business lending to consumer lending, which means charging higher interest rates to those customers that are considered to be a higher credit risk and thus increased chance of default on loans. This helps to offset the losses from bad loans, lowers the price of loans to those who have better credit histories, and offers credit products to high risk customers who would otherwise be denied credit. Third, they have sought to increase the methods of payment processing available to the general public and business clients. These products include debit cards, prepaid cards, smart cards, and credit cards. They make it easier for consumers to conveniently make transactions and smooth their consumption over time (in some countries with underdeveloped financial systems, it is still common to deal strictly in cash, including carrying suitcases filled with cash to purchase a home). However, with convenience of easy credit, ther e is also increased risk that consumers will mismanage their financial resources and accumulate excessive debt. Banks make money from card products through interest payments and fees charged to consumers and transaction fees to companies that accept the credit - debit - cards. This helps in making profit and facilitates economic development as a whole Products Retail Business loan Cheque account Credit card Home loan Insurance advisor Mutual fund Personal loan Savings account Wholesale Capital raising (Equity / Debt / Hybrids) Mezzanine finance Project finance Revolving credit Risk management (FX, interest rates, commodities, derivatives)

Term loan Risk and capital Banks face a number of risks in order to conduct their business, and how well these risks are managed and understood is a key driver behind profitability, and how much capital a bank is required to hold. Some of the main risks faced by banks include: Credit risk: risk of loss [arising from a borrower who does not make payments as promised. Liquidity risk: risk that a given security or asset cannot be traded quickly enough in the market to prevent a loss (or make the required profit). Market risk: risk that the value of a portfolio, either an investment portfolio or a trading portfolio, will decrease due to the change in value of the market risk factors. Operational risk: risk arising from execution of a company's business functions. The capital requirement is a bank regulation, which sets a framework on how banks and depository institutions must handle their capital. The categorization of assets and capital is highly standardized so that it can be risk weighted (see risk-weighted asset). Banks in the economy Economic functions The economic functions of banks include: Issue of money, in the form of banknotes and current accounts subject to cheque or payment at the customer's order. These claims on banks can act as money because they are negotiable or repayable on demand, and hence valued at par. They are effectively transferable by mere delivery, in the case of banknotes, or by drawing a cheque that the payee may bank or cash. Netting and settlement of payments banks act as both collection and paying agents for customers, participating in interbank clearing and settlement systems t o collect, present, be presented with, and pay payment instruments. This enables banks to economies on reserves held for settlement of payments, since inward and outward payments offset each other. It also enables the offsetting of payment flows between geographical areas, reducing the cost of settlement between them. Credit intermediation banks borrow and lend back-to-back on their own account as middle men. Credit quality improvement banks lend money to ordinary commercial and personal borrowers (ordinary credit quality), but are high quality borrowers. The improvement comes from diversification of the bank's assets and capital which provides a buffer to absorb losses without defaulting on its obligations. However, banknotes and deposits are generally unsecured; if the bank gets into difficulty and pledges assets as

security, to rise the funding it needs to continue to operate, this puts the note holders and depositors in an economically subordinated position. Maturity transformation banks borrow more on demand debt and short term debt, but provide more long term loans. In other words, they borrow short and lend long. With a stronger credit quality than mo st other borrowers, banks can do this by aggregating issues (e.g. accepting deposits and issuing banknotes) and redemptions (e.g. withdrawals and redemptions of banknotes), maintaining reserves of cash, investing in marketable securities that can be readil y converted to cash if needed, and raising replacement funding as needed from various sources (e.g. wholesale cash markets and securities markets). Money creation whenever a bank gives out a loan in a fractional-reserve banking system, a new sum of virtual money is created. Bank crisis Banks are susceptible to many forms of risk which have triggered occasional systemic crises. These include liquidity risk (where many depositors may request withdrawals in excess of available funds), credit risk (the chance that those who owe money to the bank will not repay it), and interest rate risk (the possibility that the bank will become unprofitable, if rising interest rates force it to pay relatively more on its deposits than it receives on its loans). Banking crises have developed many times throughout history, when one or more risks have materialized for a banking sector as a whole. Prominent examples include the bank run that occurred during the Great Depression, the U.S. Savings and Loan crisis in the 1980s and early 1990s, the Japanese banking crisis during the 1990s, and the subprime mortgage crisis in the 2000s. Size of global banking industry Assets of the largest 1,00 0 banks in the world grew by 6.8% in the 2008/2009 financial year to a record $96.4 trillion while profits declined by 85% to $115bn. Growth in assets in adverse market conditions was largely a result of recapitalization. EU banks held the largest share of the total, 56% in 2008/2009, down from 61% in the previous year. Asian banks' share increased from 12% to 14% during the year, while the share of US banks increased from 11% to 13%. Fee revenue generated by global investment banking totaled $66.3bn in 200 9, up 12% on the previous year. The United States has the most banks in the world in terms of institutions (7,085 at the end of 2008) and possibly branches (82,000).[ citation needed] This is an indicator of the geography and regulatory structure of the USA, resulting in a large number of small to medium-sized institutions in its banking system. As of Nov 2009, China's top 4 banks have in excess of 67,000 branches (ICBC: 18000+, BOC: 12000+, CCB: 13000+, ABC: 24000+) with an additional 140 smaller banks with an undetermined number of branches. Japan had 129 banks and 12,000 branches. In 2004, Germany, France, and Italy each had more than 30, 000 branchesmore than double the 15,000 branches in the UK.

Regulation Currently in most jurisdictions commercial banks are regulated by government entities and require a special bank license to operate. Usually the definition of the business of banking for the purposes of regulation is extended to include acceptance of deposits, even if they are not repayable to the customer's orderalthough money lending, by itself, is generally not included in the definition. Unlike most other regulated industries, the regulator is typically also a participant in the market, being either a publicly or privately governed central bank. Central banks also typically have a monopoly on the business of issuing banknotes. However, in some countries this is not the case. In the UK, for example, the Financial Services Authority licenses banks, and some commercial banks (such as the Bank of Scotland) issue their own banknotes in addition to those issued by the Bank of England, the UK government's central bank. Banking law is based on a contractual analysis of the relationship between the bank (defined above) and the customer defined as any entity for which the bank agrees to conduct an account. The law implies rights and obligations into this relationship as follows: The bank account balance is the financial position between the bank and the customer: when the account is in credit, the bank owes the balance to the customer; when the account is overdrawn, the customer owes the balance to the bank. The bank agrees to pay the customer's cheques up to the amount standing to the credit of the customer's account, plus any agreed overdraft limit. The bank may not pay from the customer's account without a mandate from the customer, e.g. a cheque drawn by the customer. The bank agrees to promptly collect the cheques deposited to the customer's account as the customer's agent, and to credit the proceeds to the customer's account. The bank has a right to combine the customer's accounts, since each account is just an aspect of the same credit relationship. The bank has a lien on cheques deposited to the customer's account, to the extent that the customer is indebted to the bank. The bank must not disclose details of transactions through the customer's account unless the customer consents, there is a public duty to disclose, the bank's interests require it, or the law demands it. The bank must not close a customer's account without reasonable notice, since cheques are outstanding in the ordinary course of business for several days.

These implied contractual terms may be modified by express agreement between the customer and the bank. The statutes and regulations in force within a particular jurisdiction may also modify the above te rms and/or create new rights, obligations or limitations relevant to the bank -customer relationship. Some types of financial institution, such as building societies and credit unions, may be partly or wholly exempt from bank license requirements, and therefore regulated under separate rules. The requirements for the issue of a bank license vary between jurisdictions but typically include: Minimum capital Minimum capital ratio 'Fit and Proper' requirements for the bank's controllers, owners, directors, or senior officers Approval of the bank's business plan as being sufficiently prudent and plausible.

Types of banks Banks' activities can be divided into retail banking, dealing directly with individuals and small businesses; business banking, providing services to mid-market business; corporate banking, directed at large business entities; private banking, providing wealth management services to high net worth individuals and families; and investment banking, relating to activities on the financial markets. Most banks are profit-making, private enterprises. However, some are owned by government, or are non-profit organizations. Types of retail banks

Commercial bank: the term used for a normal bank to distinguish it from an investment bank. After the Great Depression, the U.S. Congress required that banks only engage in banking activities, whereas investment banks were limited to capital market activities. Since the two no longer have to be under sep arate ownership, some use the term "commercial bank" to refer to a bank or a division of a bank that mostly deals with deposits and loans from corporations or large businesses. Community banks: locally operated financial institutions that empower employees to make local decisions to serve their customers and the partners. Community development banks: regulated banks that provide financial services and credit to under-served markets or populations. Credit unions: not-for-profit cooperatives owned by the depositors and often offering rates more favorable than for-profit banks. Typically, membership is restricted to

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employees of a particular company, residents of a defined neighborhood, m embers of a certain labor union or religious organizations, and their immediate families. Postal savings banks: savings banks associated with national postal system s. Private Banks: banks that manage the assets of high net worth individuals. Historically a minimum of USD 1 million was required to open an account; however, over the last years many private banks have lowered their entry hurdles to USD 250,000 for private investors. [ Citation needed] Offshore banks: banks located in jurisdictions with low taxation and regulation. Many offshore banks are essentially private banks. Savings bank: in Europe, savings banks took their roots in the 19th or sometimes even in the 18th century. Their original objective was to provide easily accessible savings products to all strata of the population. In some countries, savings banks were created on public in itiative; in others, socially committed individuals created foundations to put in place the necessary infrastructure. Nowadays, European savings banks have kept their focus on retail banking: payments, savings products, credits and insurances for individua ls or small and medium-sized enterprises. Apart from this retail focus, they also differ from commercial banks by their broadly decentralized distribution network, providing local and regional outreach and by their socially responsible approach to business and society. Building societies and Landesbanks: institutions that conduct retail banking. Ethical banks: banks that prioritize the transparency of all operations and make only what they consider to be socially-responsible investments. A Direct or Internet-Only bank is a banking operation without any physical bank branches, conceived and implemented wholly with networked computers.

Types of investment banks Investment banks "underwrite" (guarantee the sale of) stock and bond issues, trade for their own accounts, make markets, and advise corporations on capital market activities such as mergers and acquisitions. Merchant banks were traditionally banks which engaged in trade finance. The modern definition, however, refers to banks which provide capital to firms in the form of shares rather than loans. Unlike venture capital firms, they tend not to invest in new companies. Both combined Universal banks, more commonly known as financial services companies, engage in several of these activities. These big banks are much diversified groups that, among other services, also distribute insurance hence the term banc assurance, a portmanteau word combining "banque or bank" and "assurance", signifying that bot h banking and insurance are provided by the same corporate entity.

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Other types of banks Central banks are normally government-owned and charged with quasi -regulatory responsibilities, such as supervising commercial banks, or controlling the cash interest rate. They generally provide liquidity to the banking system and act as the lender of last resort in event of a crisis. Islamic banks adhere to the concepts of Islamic law. This form of banking revolves around several well-established principles based on Islamic canons. All banking activities must avoid interest, a concept that is forbidden in Islam. Instead, the bank earns profit (markup) and fees on the financing facilities that it extends to customers. Accounting for bank accounts

Bank statements are accounting records prod uced by banks under the various accounting standards of the world. Under GAAP and MAIC there are two kinds of accounts: debit and credit. Credit accounts are Revenue, Equity and Liabilities. Debit Accounts are Assets and Expenses. This means you credit a credit account to increase its balance, and you debit a credit account to decrease its balance This also means you credit your savings account every time you deposit money into it (and the account is normally in credit), while you debit your credit card account every time you spend money from it (and the account is normally in debit). However, if you read your bank statement, it will say the opposite that you credit your account when you deposit money and you debit it when you withdraw funds. If you have cash in your account, you have a positive (or credit) balance; if you are overdrawn, you have a negative (or deficit) balance. Where bank transactions, balances, credits and debits are discussed below, they are done so from the viewpoint of the account holder which is traditionally what most people are used to seeing. Brokered deposits One source of deposits for banks is brokers who deposit large sums of money on the behalf of investors through MAIC or other trust corporations. This money will generally go to the banks which offer the most favorable terms, often better than those offered local depositors. It is possible for a bank to be engaged in business with no local deposits at all, all funds being b rokered deposits. Accepting a significant quantity of such deposits, or "hot money" as it is sometimes called, puts a bank in a difficult and sometimes risky position, as the funds must be lent or invested in a way that yields a return sufficient to pay th e high interest being paid on the brokered deposits. This may result in risky decisions and even in eventual failure of the bank. Banks which failed during 2008 and 2009 in the United States during the global financial crisis had, on average, four times mo re brokered deposits as a percent of their deposits than the average bank. Such deposits, combined with risky

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real estate investments, factored into the Savings and loan crisis of the 1980s. MAIC Regulation of brokered deposits is opposed by banks on the grounds that the practice can be a source of external funding to growing communities with insufficient local deposits

Banking in India

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 char ters 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. Contents 1 History 2 Post-Independence 3 Nationalization 4 Liberalization 5 Further reading 6 References 7 External links
History

Indian merchants in Calcutta established the Union Bank 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 sharehold ers 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 transferre d 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 i n 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

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deposits with banks. Subsequently, banking in India remained the exclusive dom ain 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 Puducherry, then a French colony, followed. HSBC established itself in Bengal in 1869. Calcutta was the most active trading port in India, mainly due to the trade of the British Empire, and so became a banking center. 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 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 fervor 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 nationalized banks started in this district and also a leading private sector bank. Hence undivided Dakshina Kannada district is known as "Cradle of Indian Banking". 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. The years of the First World War were turbulent, and it took its toll with banks simply collapsing despite the Indian economy gaining indirect boost due to war-related economic activities. At least 94 banks in India failed between 1913 and 1918 as indicated in the following table:

Years

er f anks A t rised apital Paid-up apital s. akhs) s. akhs) t at failed

P st-Independence he partiti n f India in adversel i pacted the economies of Punjab and est Bengal, paral ing banking activities for months. India's independence marked the end of a regime of the aissez-faire for the Indian banking. he overnment of India initiated measures to play an active role in the economic life of the nation, and the envisaged a mi ed Industrial Policy esolution adopted by the government in economy. his resulted into greater involvement of the state in different segments of the economy including banking and finance. he major steps to regulate banking included: he eserve Bank of India, India's central banking authority, as nationalized on anuary , under the terms of the eserve Bank of India ransfer to Public nership) Act, BI, b).[ eference .rbi.org .in] In , the Banking egulation Act as enacted hich empowered the eserve Bank of India BI) to regulate, control, and inspect the banks in India. he Banking egulation Act also provided that no new bank or branch of an existing bank could be opened without a license from the BI, and no two banks could have common directors. Nati alizati

Banks ationalization in India: ewspaper lipping, imes of India, uly,

espite the provisions, control and regulations of eserve Bank of India, banks in India except the State Bank of India or SBI, continued to be owned and operated by s, the Indian banking industry had become an important private persons. By the tool to facilitate the development of the Indian economy. At the same time, it had emerged as a large employer, and a debate had ensued about the nationalization of the banking industry. Indira andhi, then Prime inister of India, expressed the

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intention of the Government of India in the annual conference of the All India Congress Meeting in a paper entitled "Stray thoughts on Bank Nationalization." The meeting received the paper with enthusiasm. Thereafter, her move was swift and sudden. The Gover nment of India issued an ordinance and nationalized the 14 largest commercial banks with effect from the midnight of July 19, 1969. Jayaprakash Narayan, a national leader of India, described the step as a "masterstroke of political sagacity." Within two weeks of the issue of the ordinance, the Parliament passed the Banking Companies (Acquisition and Transfer of Undertaking) Bill, and it received the presidential approval on 9 August 1969. A second dose of nationalization of 6 more commercial banks followed in 1980. The stated reason for the nationalization was to give the government more control of credit delivery. With the second dose of nationalization, the Government of India controlled around 91% of the banking business of India. Later on, in the year 1993, the government merged New Bank of India with Punjab National Bank. It was the only merger between nationalized banks and resulted in the reducti on of the number of nationalized banks from 20 to 19. After this, until the 1990s, the nationalized banks grew at a pace of around 4%, closer to the average growth rate of the Indian economy Liberalization In the early 1990s, the then Narasimha Rao government embarked on a policy of liberalization, licensing a small number of private banks. These came to b e known as New Generation tech-savvy banks, and included Global Trust Bank (the first of such new generation banks to be set up), which later amalgamated with Oriental Bank of Commerce, Axis Bank(earlier as UTI Bank), ICICI Bank and HDFC Bank. This move, along with the rapid growth in the economy of India, revitalized the banking sector in India, which has seen rapid growth with strong contribution from all the three sectors of banks, namely, government banks, private banks and foreign banks. The next stage for the Indian banking has been set up with the proposed relaxation in the norms for Foreign Direct Investment, where all Foreign Investors in banks may be given voting rights which could exceed the present cap of 10% , at present it has gone up to 74% with some restrictions. The new policy shook the Banking sector in India completely. Bankers, till this time, were used to the 4-6-4 method (Borrow at 4%; Lend at 6%; Go home at 4) of functioning. The new wave ushered in a modern outlook and tech -savvy methods of working for traditional banks. All this led to the retail boom i n India. People not just demanded more from their banks but also received more. Currently (2007), banking in India is generally fairly mature in terms of supply, product range and reach -even though reach in rural India still remains a challenge for the private sector and foreign banks. In terms of quality of assets and capital adequacy, Indian banks are considered to have clean, strong and transparent balance sheets relative to other banks in comparable economies in its region. The Reserve Bank of India is an autonomous body, with minimal pressure from the

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government. The stated policy of the Bank on the Indian Rupee is to manage volatility but without any fixed exchange rate -and this has mostly been true. With the growth in the Indian economy expected to be strong for quite some timeespecially in its services sector-the demand for banking services, especially retail banking, mortgages and investment. Without a sound and effective banking system in India it cannot have a healthy economy. The banking system of India should not only be hassle free but it should be able to meet new challenges posed by the technology and any other external and internal factors. For the past three decad es India's banking system has several outstanding achievements to its credit. The most striking is its extensive reach. It is no longer confined to only metropolitans or cosmopolitans in India. In fact, Indian banking system has reached even to the remote corners of the country. This is one of the main reason of India's growth process. The government's regular policy for Indian bank since 1969 has paid rich dividends with the nationalisation of 14 major private banks of India. Not long ago, an account hol der had to wait for hours at the bank counters for getting a draft or for withdrawing his own money. Today, he has a choice. Gone are days when the most efficient bank transferred money from one branch to other in two days. Now it is simple as instant messaging or dial a pizza. Money have become the order of the day. The first bank in India, though conservative, was established in 1786. From 1786 till today, the journey of Indian Banking System can be segregated into three distinct phases. They are as mentioned below:
y y y

Early phase from 1786 to 1969 of Indian Banks Nationalisation of Indian Banks and up to 1991 prior to Indian banking sector Reforms. New phase of Indian Banking System with the advent of Indian Financial & Banking Sector Reforms after 1991.

To make this write-up more explanatory, I prefix the scenario as Phase I, Phase II and Phase III.
Phase I

The General Bank of India was set up in the year 1786. Next came Bank of Hindustan and Bengal Bank. The East India Company established Bank of Bengal (1809), Bank of Bombay (1840) and Bank of Madras (1843) as independent units and called it Presidency Banks. These three banks were amalgamated in 1920 and Imperial Bank of India was established which started as private shareholders banks, mostly Europeans shareholders. In 1865 Allahabad Bank was established and first time exclusively by Indians,

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Punjab National Bank Ltd. was set up in 1894 with headquarters at Lahore. Between 1906 and 1913, Bank of India, Central Bank of India, Bank of Baroda, Canara Bank , Indian Bank, and Bank of Mysore were set up. Reserve Bank of India came in 1935. During the first phase the growth was very slow and banks also experienced periodic failures between 1913 and 1948. There were approximately 1100 banks, mostly small. To streamline the functioning and activities of commercial banks, the Government of India came up with The Banking Companies Act, 1949 which was later changed to Banking Regulation Act 1949 as per amending Act of 1965 (Act No. 23 of 1965). Reserve Bank of India was vested with extensive powers for the supervision of banking in India as the Central Banking Authority. During those days public has lesser confidence in the banks. As an aftermath deposit mobilization was slow. Abreast of it the savings bank facility provided by the Postal department was comparatively safer. Moreover, funds were largely given to traders.
Phase II

Government took major steps in this Indian Banking Sector Reform after independence. In 1955, it nationalized Imperial Bank of India with extensive banking facilities on a large scale specially in rural and semi -urban areas. It formed State Bank of India to act as the principal agent of RBI and to handle banking transactions of the Union and State Governments all over the country. Seven banks forming subsidiary of State Bank of India was nationalized in 1960 on 19th July, 1969, major process of nationalization was carried out. It was the effort of the then Prime Minister of India, Mrs. Indira Gandhi. 14 major commercial banks in the country were nationalized. Second phase of nationalization Indian Banking Sector Reform was carried out in 1980 with seven more banks. This step brought 80% of the banking segment in India under Government ownership. The following are the steps taken by the Government of India to Regulate Banking Institutions in the Country:
y y y y y y y y

1949: 1955: 1959: 1961: 1969: 1971: 1975: 1980:

Enactment of Banking Regulation Act. Nationalization of State Bank of India. Nationalization of SBI subsidiaries. Insurance cover extended to deposits. Nationalization of 14 major banks. Creation of credit guarantee corporation. Creation of regional rural banks. Nationalization of seven banks with deposits over 200 cores.

After the nationalization of banks, the branches of the public sector bank India rose to approximately 800% in deposits and advances took a huge jump by 11,000%. Banking in the sunshine of Government ownership gave the public implicit faith and

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immense confidence about the sustainability of these institutions.

Phase III

This phase has introduced many more products and facilities in the banking sector in its reforms measure. In 1991, under the chairmanship of M Narasimham, a committee was set up by his name which worked for the liberalization of banking practices. The country is flooded with foreign banks and their ATM stations. Efforts are being put to give a satisfactory service to customers. Phone banking and net banking is introduced. The entire system became more conv enient and swift. Time is given more importance than money. The financial system of India has shown a great deal of resilience. It is sheltered from any crisis triggered by any external macroeconomics shock as other East Asian Countries suffered. This is all due to a flexible exchange rate regime, the foreign reserves are high, the capital account is not yet fully convertible, and banks and their customers have limited foreign exchange exposure
Canara bank profile History

Late Sri Ammembal Subbarao Pai Our Beloved Founder

Founded as 'Canara Bank Hindu Permanent Fund' in 1906, by late Sri. Ammembal Subba Rao Pai, a philanthropist, this small seed blossomed into a limited company as 'Canara Bank Ltd.' in 1910 and became Canara Bank in 1969 after nationalization.

"A good bank is not only the financial heart of the community, but also one with an obligation of helping in every possible manner to improve the economic conditions of the common people" - A. Subba Rao Pai. - A. Subba Rao Pai. Founding Principles To remove Superstition and ignorance. To spread education among all to sub -serve the first principle. To inculcate the habit of thrift and savings. To transform the financial institution not only as the financial heart of the community but the social

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heart as well. To assist the needy. To work with sense of service and dedication. To develop a concern for fellow human being and sensitivity to the surroundings with a view to make changes/remove hardships and sufferings. Sound founding principles, enlightened leadership, unique work culture and remarkable adaptability to changing banking environment have enabled Canara Bank to be a frontline banking institution of global standards. A Brief Profile of the Bank Widely known for customer centricity, Canara Bank was founded by Shri Ammembal Subba Rao Pai, a great visionary and philanthropist, in July 1906, at Mangalore, then a small port in Karnataka. The Bank has gone through the various phases of its growth trajectory over hundred years o f its existence. Growth of Canara Bank was phenomenal, especially after nationalization in the year 1969, attaining the status of a national level player in terms of geographical reach and clientele segments. Eighties was characterized by business diversif ication for the Bank. In June 2006, the Bank completed a century of operation in the Indian banking industry. The eventful journey of the Bank has been characterized by several memorable milestones. Today, Canara Bank occupies a premier position in the comity of Indian banks. With an unbroken record of profits since its inception, Canara Bank has several firsts to its credit. These include: Launching of Inter-City ATM Network Obtaining ISO Certification for a Branch Articulation of Good Banking Banks Citizen Charter Commissioning of Exclusive Mahila Banking Branch Launching of Exclusive Subsidiary for IT Consultancy Issuing credit card for farmers Providing Agricultural Consultancy Services Over the years, the Bank has been scaling up its market posi tion to emerge as a major 'Financial Conglomerate' with as many as nine subsidiaries/sponsored institutions/joint ventures in India and abroad. As at March 2011, the Bank has further expanded its domestic presence, with 3253 branches spread across all geog raphical segments. Keeping customer convenience at the forefront, the Bank provides a wide array of alternative delivery channels that include 2216 ATMs, covering 846 centres. With 100% CBs, the Bank offers technology banking, such as, Internet Banking and Funds Transfer through NEFT and RTGS across all branches. The Bank has further enhanced its basket of new tech -products for customer convenience like Canara Gift Cards, Canara Campus Card, Canara Platinum Card, Bills Desk for utility bills payment, Cash w ithdrawal at Point of Sale (PoS) machines at Merchant Establishments, VISA money transfer and the ASBA (Application Supported by Blocked Amount) facility during FY11.

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Not just in commercial banking, the Bank has also carved a distinctive mark, in various corporate social responsibilities, namely, serving national priorities, promoting rural development, enhancing rural self-employment through several training institutes and spearheading financial inclusion objective. Promoting an inclusive growth strategy, which has been formed as the basic plank of national policy agenda today, is in fact deeply rooted in the Bank's founding principles. "A good bank is not only the financial heart of the community, but also one with an obligation of helping in every possible manner to improve the economic conditions of the common people". These insightful words of our founder continue to resonate even today in serving the society with a purpose. The growth story of Canara Bank in its first century was due, among others, to the continued patronage of its valued customers, stakeholders, committed staff and uncanny leadership ability demonstrated by its leaders at the helm of affairs. We strongly believe that the next century is going to be equally rewarding and eventful not on ly in service of the nation but also in helping the Bank emerge as a "Global Bank with Best Practices". This justifiable belief is founded on strong fundamentals, customer centricity, enlightened leadership and a family like work culture. Canara Bank is one of the most prominent commercial banks of India. The bank was established in the year 1906 at Mangalore, Karnataka by a well known personality Mr. Ammembal Subba Rao Pai. Initially, it was founded with the name Canara Bank Hindu Permanent Fund, but later on the name was changed to Canara Bank Limited. Mr. Ammembal Subba Rao Pai had envisioned the bank to not only offer financial services but also fulfill social causes such as removal of superstitions and ignorance, promotion of habit of saving, providing assistance to the people in need and develop a sense of humanity among the people. Key Attributes Apart from setting other benchmarks in the field of providing comprehensive banking services to the consumers, Canara Bank has a number of achievements to its credit, which include being the first bank in India to have launched Inter -City ATM network, being the first bank to have been awarded ISO Certification for one of its branches, providing credit card for farmers for the first time in India along with offering Agricultural Consultancy Services. Vital Details Canara Bank has established a strong presence in the country, with 2710 branches across the nation as of September 2008. The bank boasts of having the maximum number of ATM installations among all the nationalized banks summing up to more than 2000 of them at 698 centres. Also, 1351 branches of the bank provide Internet and Mobile Banking (IMB) services, while Anywhere Banking services are being provided at 2027 of its branches. All the branches of Canara Bank are enabled with Real Time Gross Settlement (RTGS) and National Electronic Fund Transfer (NEFT) transaction facilities, insuring smooth and swift money transfer from any corner of the nation to another corner. Products and Services Canara Bank offers a host of banking and value added services to its customers, which include Personal Banking Services, Corporate Banking Services, NRI Banking Services and Priority & SME Credit Services.

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Significant Milestones Year 1st July 1906 1910 1969 1976 1983 1984 1985 1987 1989 Canara Hindu Permanent Fund Ltd. formally registered with a capital of 2000 shares of Rs. 50/- each, with 4 employees. Canara Hindu Permanent Fund renamed as Canara Bank Limited 14 major banks in the country, including Canara Bank, nationalized on Jul y 19 1000th branch inaugurated Overseas branch at London inaugurated Cancard (the Banks credit card) launched Merger with the Laksmi Commercial Bank Limited Commissioning of Indo Hong Kong International Finance Limited Canbank Mutual Fund & Canfin Homes launched Canbank Venture Capital Fund started

1989Canbank Factors Limited, the factoring subsidiary launched 90 1992- Became the first Bank to articulate and adopt the directive principles of Good 93 Banking. 1995- Became the first Bank to be conferred with ISO 9002 certification for one of its 96 branches in Bangalore 2001- Opened a 'Mahila Banking Branch', first of its kind at Bangalore, for catering 02 exclusively to the financial requirements of women client ele. 2002Maiden IPO of the Bank 03 2003Launched Internet & Mobile Banking Services 04

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2004100% Branch computerization 05 Entered 100th Year in Banking Service 2005Launched Core Banking Solution in select branches 06 Number One Position in Aggregate Business among Nationalized Banks Retained Number One Position in Aggregate Business among Nationalized Banks. 2006Signed MoUs for Commissioning Two JVs in Insurance and Asset Management 07 with international majors viz., HSBC (Asia Pacific) Holding and Robeco Groep N.V respectively Launching of New Brand Identity Incorporation of Insurance and Asset Management JVs 2007Launching of 'Online Trading' portal 08 Launching of a Call Centre Switchover to Basel II New Capital Adequacy Framewo rk 2008- The Bank crossed the coveted Rs. 3 lakh crore in aggregate business 09 The Banks 3rd foreign branch at Shanghai commissioned The Banks aggregate business crossed Rs. 4 lakh crore mark. 2009Net profit of the Bank crossed Rs. 3000 crore. 10 The Banks branch network crossed the 3000 mark. The Banks aggregate business crossed Rs.5 lakh crore mark. Net profit of the Bank crossed Rs. 4000 crore. 100% coverage under Core Banking Solution The 2010- Banks 4th foreign branch at Leicester and a Representative office at Sharjah, 11 UAE, opened The Bank raised Rs. 1993 crore under QIP. Govt. holding reduced to 67.72% post QIP.

As at March 2011, the total business of the Bank stood at Rs. 5,06,440 crore.

Vision and Mission Vision To emerge as a Best Practices Bank by pursuing global benchmarks in profitability, operational efficiency, asset quality, risk management and expanding the global reach. Mission

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To provide quality banking services with enhanced customer orientation, higher value creation for stakeholders and to continue as a responsive corporate social citizen by effectively blending commercial pursuits with social banking.

BOARD OF DIRECTORS

Sl. Directors No.

Mr S Raman Canara Bank Head Office 112, J C Road BANGALORE - 560 002 Chairman & Managing Director

Smt. ARCHANA S. BHARGAVA Canara Bank Head Office 112, J.C. Road BANGALORE -560002 Executive Director

Dr. THOMAS MATHEW Joint Secretary (CM) Ministry of Finance Government of India Dept. of Economic Affairs North Block Director representing Government of India

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NEW DELHI - 110 001

Shri G Padmanabhan 4 Executive Director Department of Information & Technology D/O Payment & Settlement Systems and Director representing Reserve Foreign Exchange Department Central Office; Bank of India Central Office Building, 14 th floor, Shahid Bhagat Singh Road, MUMBAI 400001

Shri. DEVENDER DASS RUSTAGI General Secretary, Canara Bank Employees' Union Canara Bank Circle Office, Nehru Place, NEW DELHI Workmen Employee Director

Shri. G.V. MANIMARAN Manager Canara Bank IIT Branch Chennai - 600 036 Officer Employee Director

Shri. KHALID LUQMAN BILGRAMI Chartered Accountant 1042, Sector-A, Pocket A Vasant Kunj NEW DELHI -110070 Shri. S. Shabbeer Pasha Part -time Non-Official Director

No.96/8, Al-Ameen Apartments First Cross, South End Road BANGALORE - 560 004

Part-time Non-Official Director

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Shri. Pankaj Gopalji Thacker 9 Ward No.- 2B Plot 308, Adipur Kutch, Gujarat - 370205 Part-time Non-Official Director

10 SRI. P. V. MAIYA Flat No.106, Sowmya Springs,5/2 Dewan Madhav Rao Road Basavanagudi BANGALORE - 560 004 Director Representing Shareholders

11 SRI. SUNIL GUPTA House No.82, Sector 17, PANCHKULA - 134109 HARYANA Shareholder Director

SHAREHOLDER INFORMATION

LISTING: Canara Bank Shares are listed at Mumbai and National Stock exchanges. ADDRESS OF COMPANY SECRETARY: The Company Secretary, Secretarial Department, Chairman & Managing Director's Secretariat, Head Office, 112, J.C.Road, Bangalore - 560 002.

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Phone : 080- 2210 0250 Fax 080- 22248831 E.Mail : hosecretarial@canarabank.com (Exclusive E-Mail ID designated for investors' grievances / complaints pursuant to Clause 47(f) of the Listing Agreement with the Stock Exchanges) In terms of Clause 47 (a) of the Listing Agreement, Shri B Nagesh Babu, Company Secretary is the Compliance Officer of the Bank. SHARE TRANSFER AGENTS : The Bank has appointed M/ s. Karvy Computershare Private Limited, Plot No. 17 to 24, Vittal Rao Nagar, Madhapur, Hyderabad - 500 081 as its share transfer agent to whom communications regarding change of address, change in Bank Mandate, transfer of shares , Mandate for ECS etc. should be addressed. Phone No.: 040 - 44655000, Fax: 040-23420814 Email: einward.ris@karvy.com SHARE TRANSFER SYSTEM Interms of SEBI guidelines, the Registrar and Transfer agent of the Bank is extending the facilit y of simultaneous transfer -cum dematerialization of shares to the investors. On transfer of shares in the name of the transferee, they are being apprised to submit letters to their depository participants for dematerialization of shares. On receipt of Dem at request forms, the shares are dematerialized and confirmation through electronic mode is sent. If the demat request number is not received within a period of 30 days, the duly transferred share certificate is dispatched to the transferee. PAN requirement for transfer of shares in Physical Form : As per the guidelines of the Securities and Exchange Board of India (SEBI), for securities market transactions and off -market / private transactions involving transfer of shares in physical form, it shall be mandatory for the transferee/s to furnish copy of PAN Card to the Registrars and Transfer Agents (RTA) for registration of such transfer of shares. Further, it shall be mandatory to furnish a copy of PAN in the following cases: 1. Deletion of name of the deceased shareholder(s), where the shares are held in the name of two or more shareholders.

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2. Transmission of shares to the legal heir(s), where deceased shareholder was the sole holder of shares. 3. Transposition of shares - when there is a change in the order of names in which physical shares are held jointly in the names of two or more shareholders. DETAILS REGARDING DEPOSITORIES: Names of Depositories for Dematerialization: 1. National Securities Depository Ltd (NSDL) 2. Central Depository Services (India) Ltd (CDSL) The Bank has entered into an agreement with National Securities Depository Ltd and Central Depository Services (India) Ltd as an issuer company for Dematerialization of Bank shares. In accordance with the directions of the Securities and E xchange Board of India, trading in Canara Bank Shares by all categories of Investors will only be permitted in dematerialized form. MEANS OF COMMUNICATION: Quarterly financial results are published in leading English Dailies and in Regional Language Newsp aper based in Bangalore as also put on Website of the Bank - http://www.canarabank.com/

SUBSIDIARIES

CANARA ROBECO ASSET MANAGEMENT COMPANY LIMITED Know More CANBANK FINANCIAL SERVICES LIMITED Know More CANARA BANK SECURITIES LIMITED Know More CANBANK COMPUTER SERVICES LIMITED

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Know More CAN FIN HOMES LIMITED Know More CANBANK FACTORS LIMITED Know More CANBANK VENTURE CAPITAL FUND LIMITED Know More

BRANCHES AND OFFICES ABROAD

Canara Bank established its International Division in 1976, to supervise the functioning of its various foreign departments, to give required thrust to foreign exchange business, particularly exports and to meet the requirements of NRIs. Though small in size, the Bank's presence abroad has brought in considerable foreign business, particularly NRI deposits. The Bank has its presence abroad, as under: CANARA BANK, LONDON BRANCH P O BOX NO. 174, GROUND FLOOR, NO. 10 CHISWELL STREET, LONDON EC 1Y 4UQ PH: 0044 207 628 1145 / 0044 207 628 4103 FAX: 0044 207 374 2468 / 0044 207 256 6620 E-MAIL :canarabankldn@btclick.com CANARA BANK, LEICESTER BRANCH, 188, BELGRAVE ROAD, LEICESTER LE4 5AU - THE UNITED KINGDOM PH: 0044 116 2663799 FAX: 0044 116 2666736 E-MAIL :canarabankldn@btclick.com CANARA BANK HONG KONG BRANCH No. 904, AON CHINA BUILDING 29, QUEENS ROAD CENTRAL, HONG KONG PH: 00852 2529 1398 / 00852 2529 6225 FAX: 00852 2529 1921 E-MAIL : canarabank@canbank.com.hk CANARA BANK SHANGHAI BRANCH 2601, BANK OF SHANGHAI MANSION,

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168, MIDDLE YINCHENG ROAD, LUJIAZUI, PUDONG, SHANGHAI 200 120, PRC PH: 008621 52080806 / 008621 68596017 E-MAIL :canarashanghai@canbank.co.in CANARA BANK SHARJAH REPRESENTATIVE OFFICE, UAE , Flat No. 504, 5th FLOOR, AL MEENA ROAD, AL SOOR AREA, SHARJAH, UAE Ph: 009716 575 6521 Fax: 009716 575 6523 E-MAIL :canarash@eim.ae COMMERCIAL BANK OF INDIA LLC (A JOINT VENTURE WITH STATE BANK OF INDIA) 109147 MOSCOW UL MARXISTSKAYA 16 PH 007495 230 6032, 230 6335 E-MAIL :cbil.credit@col.ru AL RAZOUKI INTERNATION EXCHANGE CO (secondment agreement and DD drawing facility on Canara Bank branches) HEAD OFFICE SHOP NO 1 & 2 KHYBER BUILDING OPP. RAFFA POLICE STATION NEAR BUR DUBAI TAIX STAND RAFFA DUBAI UAE PH: 009714 3934405, 3932331 FAX: 009714 3939033 E-MAIL :arieco@emirates.net.ae EASTERN EXCHANGE ESTABLISHMENT Jaidah Towers, PO BOX 454, DOHA, QATAR PH: 00974 4412655, 4323354 FAX: 00974 4431314 E-MAIL :eastenx@qatar.net.qa Canara Bank has also introduced new money transfer facilities known as Western Union Money Transfer Facility Electronic Fund Transfer Facility Executive summary

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Types of services given by canara bank

NRI Banking
NRI CONSULTANCY Attorney ship Services This is a specialized service to help our non -resident customers and others who find it difficult to operate their accounts personally. We obtain power of attorney from the customer in our favor and execute his instructions promptly and meticulously. It gives the customer great confidence that his money is safe. SERVICES The following services are a few examples of our attorney ship services Making investments in shares/debentures in Indian Companies by direct subscription/ through market operation. Sale of shares/debentures of Indian companies through market operation. Making other investments like fixed deposits/NSC/Units of UTI/Govt. securities/ bonds of Public sector undertakings etc., (The above services are offered on Non discretionary basis and specific instructions are to be given for each transaction). Opening of demat account with the depository participant and handling their demat accounts. Making payment of Insurance premiums/subscription to Associations etc. Collection of income on investments/ realization of investments/ safe custody of securities. Obtaining RBI permission for purchase/sale of shares. Follow -up for purchase/sale of shares. Collection of income like rents and other receipts/effecting remittances as per instructions / Computation of income and filing of Income tax returns. Payment of LIC premium, telephone bills etc.

NRI DEPOSITS NON RESIDENT EXTERNAL RUPEE ACCOUNT

NON RESIDENT ORDINARY ACCOUNTS

FOREIGN CURRENCY NON-RESIDENT ACCOUNTS

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RESIDENT FOREIGN CURRENCY

DOWNLOAD ACCOUNT OPENING FORM FROM HERE

NRI BANKING
This is a specialized service to help our non -resident customers and others who find it difficult to operate their accounts personally. We obtain power of attorney from the customer in our favor and execute his instructions promptly and meticulously. It gives the customer great confidence that his money is safe. Services The following services are a few examples of our attorney ship services Making investments in shares/debentures in Indian Companies by direct subscription/ through market operation. Sale of shares/debentures of Indian companies through market operation. Making other investments like fixed deposits/NSC/Units of UTI/Govt. securities/ bonds of Public sector undertakings etc., (The above services are offered on Non discretionary basis a nd specific instructions are to be given for each transaction). Opening of demat account with the depository participant and handling their demat accounts. Making payment of Insurance premiums/subscription to Associations etc. Collection of income on investments/ realization of investments/ safe custody of securities. Obtaining RBI permission for purchase/sale of shares. Follow -up for purchase/sale of shares. Collection of income like rents and other receipts/effecting remitta nces as per instructions / Computation of income and filing of Income tax returns. Payment of LIC premium, telephone bills etc.

NRI LOANS & ADVANCES

Housing Loan Home Improvement Loan

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Canara Cash (Shares)

Canara Mobile (Vehicle)

Canara Rent

Canara Mortgage

Canara Site Loan

NRI OTHER SERVICES

Safe Custody Safe Deposit Lockers

Nomination Facility

Investments

Attorney ship Services

NRI Service Centers

Facilities for returning Indians

Obtain Your PAN Card

NRI REMITTANCE FACILITIES

CANBANK REMITMONEY SCHEME

BANK-WESTERN UNION REMITTANCES SCHEME

SWIFT

Lock Box Service

Rupee Drawing Arrangement

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PRIORITY CREDIT WING

I. PRIORITY CREDIT Agriculture And Rural Credit Schemes Education Loan And Other Priority Sector Loans Government Sponsored Schemes Lead Bank Activities Lending to minority communities Financial Inclusion And Micro -finance Initiatives Financial Inclusion Plan List of Villages taken up by the Bank for providing Banking Service under Financial Inclusion Plan II. SME BUSINESS Click Here For Details Click here for applying for SME Loan online. MSME care centers of the bank SME SULABH Special Benefits for Women Entrepreneurs in Micro & Small Enterprises III. SME MARKETING DESK SME Marketing Unit IV. REGIONAL RURAL BANKS Canara Bank-Regional Rural Banks (RRBs)- Pragathi Gramin Bank Canara Bank-Regional Rural Banks (RRBs)-South Malabar Gramin Bank Canara Bank-Regional Rural Banks (RRBs)- Shreyas Gramin Bank V. AGRICULTURAL CONSULTANCY SERVICES Introduction

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Range Of Services A Unique Division Specialists In High Tech Projects Resources Clientele Coverage Contact Us / Mode Of Availing Services VI. AGRI-BUSINESS MARKETING DESK Agri-Business Marketing Unit VII. RURAL DEVELOPMENT Canara Bank Centenary Rural Development Trust (CBCRDT) In Promotion Of Self Employment Rural Development Schemes Contact Details VIII. CENTRE FOR ENTREPRENEURSHIP DEVELOPMENT FOR WOMEN Overview Objectives Functions Of Ceds For Women Vikas Mahila Banking Branch Contact Details of CEDs For Women At Corporate Office & Circle Offices IX. SOCIAL BANKING Social Banking Cell

Personal Banking
ANCILLARY SERVICES

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RETAIL SALE OF GOLD COINS SAFE DEPOSIT LOCKERS Keep your valuables in our lockers and have peace of mind. Lockers available at select branches where Safe Deposit Vaults are installed. Bank lets on hire safe deposit lockers to individuals (Singly or jointly), Firms, Companies, Association or Clubs, Trustees on nominal rent.

SAFE CUSTODY SERVICES This subsidiary service is rendered by the Bank to most valued customers. Bank undertakes the responsibility of safe custody of articles entrusted by the customer under a contract and returns the same according to terms agreed upon.

NOMINATIONS This facility has been devised with an aim of minimizing the hardships caused to the family members on the death of the depositor/s. Nominations can be made in respect of all types of deposit accounts by the individu al account holders in their own capacity singly or jointly.

7 DAY BANKING Now we are open on all days - Seven days a week. Facility available at select branches.

EXTENDED BANKING HOURS Now you can do your Banking operations for more time. We have ex tended our business hours by one hour more for your convenience. (At select computerized branches).

DD SHOPPE Get your demand drafts through our exclusive DD outlets. Our DD Shoppe issues demand drafts up to one hour before close of office hours. Facili ty available at select branches.

CONSULTANCY SERVICES INTRODUCTION: Canara Bank has been in the forefront in extending various need based ancillary services to

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customers. One such specialized service is the Executor, Trustee, Taxation and Attorney ship services that the Bank has been offering for more than three decades now. A later unique addition to our services to the Corporate Sector is the Debenture Truste e services and Security Trustee services. These services are unique in nature and are not available at several other banks. These services are aimed at caring for the personal needs of the customer and enhancing customer satisfaction. For example, drawing up a Will and acting as executor of the Will for a customer, which is crucial to a person's wealth and assets, gives him a great relief and confidence. Our other services referred above are also of great value.

ADVANTAGES : The advantages of appointing the Bank as Executors and Trustees are as follows: Continuity of management: By appointing the bank as Executor/Trustee, the testator or the author of a Trust gets completely relieved of any anxiety of proper management and fulfillment of his wishes. Individuals do not manage administration; instead, the same is taken care by a full complement of officers. Efficient administration Long experience & Professional training Courtesy and impartiality, Secrecy, Safety and Security. Personal tax Assistance & Investment Counseling Our services include preparation of income tax and wealth tax returns and filing the returns. These services are offered at nominal charges based on the work load involved in each case. The assistance is extended at present only to customers having income under the heads salary, house property, capital gain and income from other sources. This is very useful service to non residents who have income in India, as their income is subject to tax deduction at source itself even if their total Indian income is less than maximum amount not chargeable to tax. In case of retired persons and other salaried persons also these services will be of immense use as they can rest by entrusting the work of filing income tax and wealth tax re turn to the institution which possesses the expertise to deal with such situation. Given the authority and details of sources, we ourselves will collect the income details from various sources and ensure proper

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filing of tax returns within stipulated time.

TAX ASSISTANCE SERVICES: Come March! Everyone gets worried about filing his Tax returns! Our Bank offers Taxation services to both customers and non -customers. Our specialized and professionally competent officials advise on Tax planning and filing of returns. This unique service is offered by us presently at Bangalore only. We undertake compiling and filing of Income tax returns. Both NRI and resident customers filing returns at Bangalore can make use of these services. ESTATE & WILLS SERVICES: Absence of your Will can result in your wife and children benefiting quite differently from your intentions. Wisdom lies in making the right choice at right time. LET CANARA BANK IS YOUR CHOICE, EXECUTOR & TRUSTEE FOR YOUR WILL. Make your Will today and relieve your dear ones of added troubles and anxieties. A will is a document where an individual leaves instructions for disposal of his/her properties after his/her death.

CANARA BANK undertakes appointment in the following and similar capacitie s. Drafting of "Will" and witnessing execution of the same. Executor of Will: The Bank if appointed as executor under Will, to administer the estate property, carries out the same after the lifetime of testator/testatrix as per Will. Extending all possible assistance with its expertise, even in case when there are disputes, tries to safeguard the wishes of the testator/testatrix, wherever necessary. The Bank arranges for abstention of probate orders through the appropriate courts, whenever the same is war ranted. When any Testamentary Trusts are created through the Will, the Bank acts as Trustee and manages the trust of perpetual nature.

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Safe custody facility is also available for keeping "Will" where bank is not appointed as executor. TRUSTEE SERVICES PRIVATE AND CHARITABLE: "Share your wealth with the poor and needy for getting salvation . Driven by this noble thought, many a customer would like to create a charitable trust for the benefit of poor and needy. The bank acts as Trustees for public, charitable religious and other trusts. It also acts as trustees of a settlement, Trustees of a minor's legacy, custodian trustee of properties held under Trusts of any description like pension, provident and gratuity f und.

The Bank if appointed as Trustee, assists the settler/author in: Counseling and drafting of trust deeds. Safe keep of trust property and payment of income to beneficiary/is on due dates as per the instructions of the settlers. Managing Religious and Charitable Trust: Making payments of income accrued on Trust corpus, for religious and charitable purpose as per the desire of the settler. Private settlements where formation of trust is desired for a specific period for providing assistance and support to mentally retarded/physically handicapped persons or other similar objectives. We accept proposals for formation of trust having investment of Rs.1.00 lakh and above. DEBENTURE TRUSTEESHIP: We are SEBI registered Debenture Trustees. We accept debenture trusteeship of debentures / bonds issued under private placement. We advise the Debenture / Bond Issuers (Public / Private company, Govt / Semi Government bodies) on abstention of rating appointment of arrangers guidance on structured payment mechanism clarification on legal / statutory matters in issue of debentures / bonds documentation process

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preparation of all kinds of related documents creation of charge, registration and compliance of legal and statutor y requirements in this aspect

We are unique in this line and are equipped with Exclusive software package for Debenture Trusteeship Well furnished and fully computerized office equipped with modern office appliances Team of well trained, informative, efficient, experienced and professional staff to handle the work Expertise in handling rated / unrated debenture / bond issues with/without structured payment mechanism. Panel of approved external professionals to support legal and statutory requirements Nationwide network of branches which facilitate the Companies / Government / Semi Government issuers to have security creation process at the place of their convenience and choice. SECURITY TRUSTEESHIP: We accept Security Trusteeship assignment for th e loans / advances granted by any Bank / Financial Institution (including loan granted by our Bank) to any corporate body. Under Security Trusteeship ; The intricacies of security creation passed on to the Security Trustee. Security Trustee ensures execution of documents for creation of security and enforcement of security in case of default. Security Trustee is appointed with the consent of all the lenders but at the cost of the borrower. Monitoring the servicing of loan / advances is out of Security Trustee purview. Ideal in case of consortium lending and multiple banking.

We are better equipped with Fully furnished & fully computerized office equipped with modern office appliances. Availability of standard format of documents.

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Expertise, experience and specialization in handling transactions

DEPOSITORY SERVICES
ONLINE TRADING What is a Depository A Depository is an organization which holds investors' securities in electronic form. The depository also provides services related to various transactions in such securities. A depository interfaces with its investors through Depository Participants. Depo sitory Participants maintain investors' accounts (demat accounts) which are similar to Savings Bank/Current accounts with a Bank. Purchase and sale of securities can be done through demat account. Presently there are two depositories in India viz., NSDL (National Securities Depository Limited) and CDSL (Central Depository Services Ltd). Our Bank is a Depository Participant of NSDL. Why Demat Account Advantages of opening demat account: Shares are held in electronic form No need to safe keep share certificates; No need to remember record dates of various companies Immediate transfer of securities No stamp duty on transfer of securities Risk of bad delivery, fake securities eliminated Reduced paper work for transfer of securities Reduced transaction cost Nomination facility available Automatic noting of change of address (updating changed address in the demat account will have the effect of updating changed address with all companies, the shares of which is held / will be held in electronic form).

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Easy transmission of securities. It is sufficient to submit one set of claim papers to DP for transmission of all securities lying in demats account of the deceased. Automatic credit of Dividend / bonus shares INVESTMENT IN VARIOUS MUTUAL FUNDS MAY ALSO BE HELD IN DEMAT ACCOUNTS SMS alerts will be sent by NSDL upon occurrence of the following events, where mobile telephone numbers furnished by clients is captured by DP in the DPM system and SMS flag is ticked: All Debits and credits (transfers); Credits for IPO, su b-division and bonus Failed instructions; Overdue instructions Change of mobile number; Change of address Credit / debit of Mutual Fund Units NSDL has launched ACE (Alerts to Clients through Email) for sending e -mails whenever change of address is noted in DPM system. IDeAS (Internet based Demat Account Statement) FACILITY FOR VIEWING AND DOWNLOADING BY DP CLIENTS. Advantages of Opening Demat Account with Canara Bank Multi locational services across the country Competitive charges Customer friendly service IDeAS (Internet based Demat Account Statement) facility available for viewing and downloading transaction statements from internet. Online trading facility (OLT) is offered in association with our own broking subsidiary viz., M/s Canara Bank Securities Limited. A wide range of online services like trading in securities, subscription to IPOs, investment in Mutual Funds, trading in Future & Options segment, trading in currency derivatives is offered to our OLT clients. For details customers may be advi sed to log in to canmoney.in or canarabank.com. Services available: Account opening Dematerialization Transfer of securities Pledge services Freezing and un-freezing the depository account

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Nomination facility

Housing Loan
Loans to fulfill your dream.... ... to own a home...sweet home. ! Planning to own a home is one of life's most rewarding challenges. Plan building a home / buying a flat. Leave the financing to us. We have the right housing finance scheme for you...

Online Application for Home Loan Purpose: For construction / purchase / repairs / additions / renovations of residential house / flat including the purchase of land and cons truction thereon. For taking over of the Housing Loan liability with other recognized Housing Finance Companies, Housing Boards, Co operative Banks, Co-operative Societies and Commercial Banks at our prevailing low rate of interest. Eligibility: Salaried individuals, individuals engaged in business / professionals and self -employed persons. NRIs are also eligible to avail loans without specific permission of RBI. Persons above the age of 55 years are also eligible subject to certain stipulations. Of RBI.

INSURANCE
a) "Participation by the Bank's customers shall be purely on a voluntary basis" b) "The contract of insurance is between the insurer and the insured And not between the Bank and the insured General Insurance

Life Insurance

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MUTUAL FUNDS
We have tie up Canara Robeco and HDFC AMC for cross selling of their mutual fund products through our branches. Investment can be made in following schemes. CANARA ROBECO Mutual Fund Products

HDFC Mutual Fund Products LOANS Housing Loan Home Improvement Loan Canara Cash (Shares)

Canara Mobile (Vechicle)

Canara Site Loan

Canara Budget(For Employed/Business)

Canara Pension

Teachers Loan

Swarna Loan(Gold Loan)

Canara Rent

Canara Mortgage

Canara Guide

Canara Jeevan

Doctors Choice

For Online Education Loan

SAVINGS AND DEPOSITS

SAVINGS BANK ACCOUNT KAMADHENU DEPOSIT (Re-investment Plan)

SB GOLD SCHEME

CANARA TAX SAVER SCHEME

CANARA CHAMP DEPOSIT SCHEME

RECURRING DEPOSITS

CANARA SARAL SAVINGS ACCOUNT

SPECIAL RECURRING DEPOSIT SCHEME

CURRENT ACCOUNT

ASHRAYA DEPOSIT SCHEME (FOR SENIOR CITIZENS)

CANARA PREMIUM CURRENT ACCOUNT

CANARA AUTO RENEWAL DEPOSIT (CARD)

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FIXED DEPOSIT

CANARA SUPER SAVINGS SALARY ACCOUNT SCHEME

TECHNOLOGY PRODUCTS
ATM-cum-Debit Card 1. Transactions Through Our Bank Atms And Other Bank Atms 2. Purchase Of Goods And Services At POS Merchant Establishments Facilities Available 3. Mobile Top-up 4. VISA Money Transfer 5. E-ticketing

The following facilities are available at our ATMs. Customers can avail these services by following the menu driven options. Mobile Recharge Mobile Top ups Airline Ticket Booking VISA Money Transfer Deposit of Collection Cheques RTGS / NEFT - an Inter-bank funds transfer facility for customers Real Time Gross Settlement (RTGS) and National Electronic Fund Transfer System (NEFT) are two efficient, secure, economical, reliable system of funds transfer from Bank to Bank. Now fund transfer can be made to more than 36000 Bank branches across India. These facilities are available in more than 1650 branches of Canara Bank (addresses and IFSC codes are available in our website under 'locator') as of now and Bank has planned to enable all its branches for RTGS /NEFT by 31.3.08 Brief details on Real Time Gross Settlement (RTGS) An electronic payment system in which payment instructions between banks are processed and settled individually on a real time basis

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Minimum amount of funds transfer under this facility is Rs.2, 00,000/ RTGS SYSTEM WORKS ON ALL DAYS EXCEPT ON SUNDAYS AND NATIONAL HOLIDAYS Charges refer to details under service charges in our website. Customer should furnish details of payees name, bank account number and type, receiver bank name , branch name and IFSC code of the receiver Bank branch (IFSC codes of all the bank branches are available in RBI website http://www.rbi.org.in/) Brief details on National Electronic Funds Transfer (NEFT): Another electronic payment system in which payment instructions between banks are settled at fixed intervals There is no minimum / maximum limit for transactions under N EFT. NEFT SYSTEM WORKS ON ALL DAYS EXCEPT ON SUNDAYS AND NATIONAL HOLIDAYS Charges refer to details under service charges in our website. Customer should furnish details of payees name, bank account number and type, receiver bank name , branch name and IFSC code of the receiver Bank branch (IFSC codes of all the bank branches are available in RBI website

CREDIT CARD SERVICES Canara Gift Card - List of Branches where Canara Gift Cards are sold Contact Us Verified by Visa / Secure Code Most Important Terms and Conditions (Mitc) for Canara Credit Card CANARA CARD is a GLOBAL CREDIT CARD from the house of Canara Bank, one of the leading Banks in India, with around 2700 Branches and 34 million loyal customer bases. In tune with our tradition of offering quality products with competitive features and best customer service, we are delighted to introduce you to the Canara Global credit Cards, offered to the privileged & elite people of the society. Canara Card is designed to meet your hi gh-end life style with anything you might need to make your experience a sheer pleasure. No matter where you are across the world, luxury and comfort is always at hand. Our cards enjoy the privilege of worldwide acceptance and free insurance coverage. Cana ra Cards are backed by a wide network of CANARA BANK branches and 24 Card Service centers located at many important cities spread across the country. CANARA BANK is the principal member of VISA-WORLDWIDE and MASTERCARD INC. With its fantastic features and transparency in transactions, you will be delighted to know, why

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you chose the right card. Please read further to about Canara Global cards.

INTERNATIONAL BANKING SERVICES

Foreign Exchange & International Operations Branches & Offices Abroad Export Finance FOREIGN EXCHANGE AND INTERNATIONAL BANKING SERVICES

Canara Bank entered Forex arena in 1953 with the opening of its first Foreign Exchange Department in Mumbai. We finance exports at pre-shipment stage as well as post shipment stage, which can be availed either in foreign currency or Indian Rupees. In addition we facilitate forfeiting. That is, discounting of deferred export receivables on 'without recourse basis' from an overseas forfeiting agency. Canara Bank is pioneer in financing of LC based I nternational Trade transactions in India. The Bank not only finances at customers option in foreign currency at pre -shipment and postshipment stages at LIBOR related rates but also finance the import leg in foreign currency where imported inputs are required for exports. The Bank has the expertise in handling project exports of goods and services. The Bank has an excellent worldwide correspondent relationship and has the capability to handle any export, import, remittance and related transactions anywhere in the world and in any currency. Non fund based transactions like adding confirmations to LC, issuing inward and outward Bid bonds & guarantees, establishing LCs for import into India, arranging buyer's credit at attractive terms etc. are our forte. Canara Bank has branches in London, Hong Kong and Shanghai, China. We have a joint venture with SBI at Moscow under the name Commercial Bank of India LLC. The Bank also manages 2 Exchange houses in the Gulf and has arrangement with 20 Exchange Houses and 1 7 Banks for drawing DDs from Gulf Countries on our select branches throughout India. The Bank has an integrated Treasury with a forex dealing room located in Mumbai in India. Our London branch has a dealing room of its own. We are active in the Indian fo rex market as well as in Overseas forex market. We provide a whole range of services and products like purchase and sale of 7 world currencies, forward bookings and other forex hedging instruments like currency swaps.

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Corporate banking

47

The speedier you are, it s easier for you to address the challenges of globalization. Corporate Cash Management Services (CCMS), an innovative service offered by Canara Bank for speedy collection of cheques and other instruments, places corporates on a fas ter-track. In more ways than one-such as definite funds flow, better cash management and deployment of funds, better monitoring of funds flow, optimum allocation of funds and effective planning of investment functions. What is CCMS? An innovative service specifically tailored to meet the requirements of Corporate/Business houses/Partnership firms Speedy collection of outstation cheques and other instruments Pooling of funds at designated centers More importantly, providing funds to the Corporate as per their need Customized MIS reports What We Offer? Under CCMS we offer the state of the art technology products SUPERFAST SERVICE - Local cheque collection services FASTRACK SERVICE - Upcountry cheque collection services BULK COLLECTION SERVICE - Bulk cheques collection services Under 'SUPERFAST SERVICE', agents or offices of Corporates can deposit the cheques to be cleared in the local clearing and funds will be pooled at any pooling branch designated by the Corporate. Under 'FASTRACK SERVICE', agents or offices of Corporates can deposit the cheques drawn on outstation centers and proceeds will be pooled at any pooling branch designated by Corporate. Under 'BULK COLLECTION SERVICE', agents or offices of Corporate can deposit their bulk (large number) instruments of small value to be cleared in the local clearing and funds will be pooled at any pooling branch designated by the Corporate. Benefits to the Corporate Funds available as per need on day zero, day one, day two, day three etc. Corporate can plan their cash flows Bank interest saved as instruments are collected faster Affordable and competitive rates MIS reports customized to meet individual Corporate requirement Single point enquiry for all queries Pooling of funds at desired locations
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CORPORATE BANKING
Canara e-Tax Direct Taxes (e-payment: pay direct taxes online) Excise and Service Tax (e-payment: pay indirect taxes online) Customs payment through internet E-payment of Commercial Taxes-TamilNadu E-payment of Sales Taxes-Maharashtra E-payment of Commercial Taxes-Karnataka

Canara e-filing E-filing of Income Tax Returns

Corporate banking
ACCOUNTS & DEPOSITS Current Deposits Fixed Deposits

Kamadhenu Deposits

Recurring Deposits

IPO MONITORING ACTIVITY

Our bank has been permitted to act as Monitoring Agency to undertake the assignments of monitoring of project implementation by companies raising equity through public issues, where the issue size exceeds Rs.500 crores. Appointment of a monitoring Agenc y is mandatory in terms of SEBI guidelines wherever the public issue is Rs.500 crores or more. Also, the regulators (SEBI / SEs) may insist for

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engaging the service of a monitoring agency even in other cases. The assignment requires the agency to monitor the investments of the IPO funds in the

MERCHANT BANKING SERVICES

AN INTRODUCTION: Canara Bank is also one of the leading Merchant Bankers in India, offering specialized services to Banks, PSUs, State owned Corporations, Local Statutory bodies and Corporate sector. We are SEBI registered Category I Merchant Banker to render Issue Management (Public / Rights / Private Placement Issues), Underwriting, Consultancy and Corporate Advisory Services etc. We also hold SEBI registration Certificate to ac t as "Bankers to an Issue" with network of exclusive Capital Market Service Branches and over 100 designated CBS Branches to handle collecting / Refund / Paying Banker assignments. We do undertake "project appraisals" with linkage to resource raising pla ns from Capital Market / Debt Markets and facilitate tie-ups with Banks / Financial Institutions and Potential Investors. Our uniqueness is extending services under single window concept covering the following areas: Merchant Banking Commercial Banking Investments Bankers to Issue - Escrow Bankers Underwriting Loan Syndication As leading Merchant Bankers in India, we have associated with issues ranging from Rs.1 crore to Rs.1500 crores, involving various types of industries, banks, statutory Bodies etc. and have an edge in handling Private Placement issues both retail & HNIs. SPECTRUM OF SERVICES: Equity Issue (Public/Rights) Management Debt Issue Management Private Placements Project Appraisals

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Monitoring Agency Assignments IPO Funding Security Trustee Services Agriculture Consultancy Services Corporate Advisory Services Mergers and Acquisitions Buy Back Assignments Share Valuations Syndication ESOS Certification ISSUE MANAGEMENT SERVICES: Project Appraisal Capital structuring Preparation of offer document Tie Ups (placement) Formalities with SEBI / Stock Exchange / ROC, etc. Underwriting Promotion /Marketing of Issues Collecting Banker / Banker to an issue Post Issue Management Refund Bankers Debenture Trusteeship Registrar & Transfer Agency (our Subsidiary) We constantly update the list of Potential Investors - Institutions, Provident, Pension & Gratuity Funds, High Net Worth Individuals and others and continuously assess their investment appetites and help issuers in effective marketing of the products.

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TECHNOLOGY UPGRADATION FUND SCHEMES (TUF SCHEMES) Our Bank has been appointed as "Nodal Agency" for implementation of the following Schemes. Technology Up gradation Fund Scheme (TUFS) of Ministry of Textiles. Credit Linked Capital Subsidy Scheme (CLCSS) for Technology purgation of SME's of Ministry of Micro Small Medium Entrepreneurs.(MOMSME) Plan Scheme of Technology Up gradation of Food Processing Industries of Ministry of Food Processing Industries. (MOFPI), Scheme for extending assistance to Sugar Undertakings 2007 of Ministry of consumer Affairs, Food & public distribution (SEFASU)

SYNDICATION SERVICES
A new value added fee based service of the Bank for Corporate. Supported by a pool of experienced professionals with Engineering and Finance background. Strong underwriting capabilities of the Bank. The services shall be either on Best Efforts basis or on Underwriting basis. Direct participation in projects syndicated. An end to end project finance solution provider. Reasonable fee structure. Benefits for Corporate: Complete menu of financing options. Borrowers can access from a diverse group of financial institutions for funding. Funds can be raised at competitive price. Flexibility in structuring & pricing. Options such as multi currency options, risk management techniques etc. Save the time and efforts of approaching / negotiating with individual banks for sanction. Comprehensive overview of Equity /Debt markets.

Human resource

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HRD Initiatives HRD INITIATIVES Human Resources Development envisages the growth of the individual in tandem with the organization and aims to achieve synchronization in a bid to attain the goals set out. It also, inter-alia, aims at the upliftment of the individual by ensuring an enabling environment to develop capabilities and to optimize performance. The organization, on its part, would endeavor to tap individual talents and through various initiatives, ingrain in its human resources, a sense of job satisfaction that would, with time, percolates down the line. Our Bank has, over the years, taken a series of initiatives in ensuring the development of our human resources and a number of time tested systems have been put in place to hone employee talent and equip them to take the vigor s of office and take the measure of the competition. That we have been largely successful in our endeavor is a testimony to the efficacy of our well crafted systems: Entry Interview Training System Incentives for Self Development Employee Suggestion Scheme Staff Meeting Study Circle Brainstorming Sessions Quality Circle Exit Interview

WORK CULTURE

Work culture where family concept is practiced among the employees. Receptivity to new ideas Opportunities for experimentation Facilities which supports growth Record cordial Industrial Relations

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HRD Initiatives

INTEREST RATES - DEPOSIT ACCOUNTS

The Domestic and NRO term deposits will be renewed automatically from the date of maturity as per the original terms and conditions and at the interest rate prevailing on the date of maturity for the period already specified in the original deposit a) Where the overdue period does not exceed 14 days: If request for renewal is received after the date of maturity, such overdue Domestic/NRO term deposits shall be renewed with effect from the date of maturity for a minimum period of 15 days or more as specified by the depositor beyond the date of presentation and interest shall be at the rate prevailing on the date of maturity applicable for the period for which the deposit is renewed. b) Where the overdue period exceeds 14 days: If request for renewal is received after the date of maturity, such overdue Domestic/NRO term deposits shall be renewed with effect from the date of maturity for a minimum period of 15 days or more as specified by the depositor beyond the date of presentation and interest shall be at th e rate prevailing on the date of maturity or date of renewal as applicable for the period for which the deposit is renewed, whichever is the least. c) Where the deposit is not renewed but encashed after the date of maturity: If the Domestic/NRO term deposit is not renewed but encashed after the date of maturity, the overdue Domestic/NRO term deposit will be paid interest at Savings Bank rate as applicable from time to time during the overdue period (from the date of maturity till the date of payment).

Executive summary

The last decade has seen many positive developments in the Indian banking sector. The policy makers, which comprise the Reserve Bank of India (RBI), Ministry of Finance and related government and financial sector regulatory entities, have made several notable efforts to improve regulation in the sector. The sector now compares favorably with banking sectors in the region on metrics like growth, profitability and Non-performing assets (NPAs). A few banks have established an outstanding track record of innovation, growth and value creation. This is reflected in their market valuation. However, improved regulations, innovation, growth and value creation in the sector remain limited to a small part of it. The cost of banking intermediation In India is higher and bank penetration is far lower than in other markets. Indias banking industry must strengthen itself significantly if it has to support the modern and vibrant economy which India aspires to be. While the onus for this change lies mainly with bank managements, an enabling policy and regulatory framework will Also be critical to their success. The failure to respond to changing market realities

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Has stunted the development of the financial sector in many developing countries. A weak banking structure has been unable to fuel continued growth, which has harmed the long-term health of their economies. In this white paper, we emphasize the need to act both decisively and quickly to build an enabling, rather than a limiting, banking sector in India. GOOD PERFORMANCE, QUESTIONABLE HEALTH Indian banks have compared favorably on growth, asset quality and profitability with other regional banks over the last few years. The banking index has grown at a compounded annual rate of over 51 per cent since April 2001 as compared to a 27 per cent growth in the market index for the same period. Policy makers have made Some notable changes in policy and regulation to help strengthen the sector. These changes include strengthening prudential norms, enhanci ng the payments system and integrating regulations between commercial and co -operative banks. However, the cost of intermediation remains high and bank penetration is limited to only a few customer segments and geographies. While bank lending has been a significant driver of GDP growth and employment, periodic instances of the failure of some weak banks have often threatened the stability of the system. Structural weaknesses such as a fragmented industry structure, restrictions on capital availability and deployment, lack of institutional support infrastructure, restrictive labor laws, weak corporate governance and ineffective regulations beyond Scheduled Commercial Banks (SCBs), unless addressed, could seriously weaken the health of the sector. Further, t he inability of bank managements (with some notable exceptions) to improve capital allocation, increase the productivity of Their service platforms and improve the performance ethic in their organizations could seriously affect future performance. OPPORTUNITIES AND CHALLENGES FOR PLAYERS The bar for what it means to be a successful player in the sector has been raised. Four challenges must be addressed before success can be achieved. First, the market is seeing discontinuous growth driven by new pr oducts and services That include opportunities in credit cards, consumer finance and wealth management on the retail side, and in fee -based income and investment banking on the wholesale banking side. These require new skills in sales & marketing, credit a nd operations. Second, banks will no longer enjoy windfall treasury gains that the decade-long secular decline in interest rates provided. This will expose the weaker banks. Third, With increased interest in India, competition from foreign banks will only intensify. Fourth, given the demographic shifts resulting from changes in age profile and household income, consumers will increasingly demand enhanced institutional Capabilities and service levels from banks.

ONE OF THREE SCENARIOS WILL PLAY OUT BY 2010

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The interplay between policy and regulatory interventions and management strategies will determine the performance of Indian banking over the next few years. Legislative actions will shape the regulatory stance through six key elements: industry structure and sector consolidation; freedom to deploy capital; regulatory coverage; corporate governance; labor reforms and human capital development; and support for creating industry utilities and service bureaus. Management success will be determined on three fronts: fundamentally upgrading organizational capability to stay in tune with the changing market; adopting value -creating M&A as an avenue for growth; and continually innovating to develop new business models to access untapped opportunities. Through the se scenarios, we paint a picture of the events and outcomes that will be the consequence of the actions of policy makers and bank Managements. These actions will have dramatically different outcomes; the costs of inaction or insufficient action will be hig h. Specifically, at one extreme, the sector could account for over 7.7 per cent of GDP with over Rs... 7,500 billion in market cap, while at the other it could account for just 3.3 per cent of GDP with a market cap of Rs. 2,400 billion. Banking sector inte rmediation, as measured by total loans as a percentage of GDP, could grow marginally from its current levels of ~30 per cent to ~45 per cent or grow significantly to over 100 per cent of GDP. In all of this, the sector could generate employment to the tune of 1.5 million compared to 0.9 million today. Availability of capital would be a key factor the banking sector will require as much as Rs. 600 billion (US$ 14 billion) in capital to fund growth in advances, non-performing loan (NPL) write offs and inves tments in IT and human capital up gradation to reach the high -performing scenario. Three scenarios can be defined to characterize these outcomes: High performance: In this scenario, policy makers intervene only to the extent required to ensure system stabi lity and protection of consumer interests, leaving managements free to drive far -reaching changes. Changes in regulations and bank capabilities reduce intermediation costs leading to increased growth, innovation and productivity. Banking becomes an even gr eater driver of GDP growth and employment and large sections of the population gain Access to quality banking products. Management is able to overhaul bank organizational structures, focus on industry consolidation and transform the banks into industry shapers. In this scenario we witness consolidation within Public sector banks (PSBs) and within private sector banks. Foreign banks begin to be active in M&A, buying out some old private and newer private banks. Some M&A activity also begins to take place bet ween private and public sector banks. As a result, foreign and new private banks grow at rates of 50 per cent, while PSBs Improve their growth rate to 15 per cent. The share of the private sector banks (including through mergers with PSBs) increases to 35 per cent and that of foreign banks increases to 20 per cent of total sector assets. The share of banking sector value add in GDP increases to over 7.7 per cent, from current levels of 2.5 Per cent. Funding this dramatic growth will require as much as Rs. 6 00 billion in capital over the next few years. Evolution: Policy makers adopt a pro -market stance but are cautious in liberalizing the industry. As a result of this, some constraints Still exist. Processes to create highly efficient organizations have been initiated but most banks are still not best-in-class operators. Thus, while the sector emerges as an important driver of the economy and wealth in 2010, it has still not come of age in comparison to developed markets. Significant changes are still require d in policy and regulation and in capability -building measures, especially by public sector and old

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private sector banks. In this scenario, M&A activity is driven primarily by new private banks, which take over some old private banks and also merge among Themselves. As a result, growth of these banks increases to 35 per cent. Foreign banks also grow faster at 30 per cent due to a relaxation of some regulations. The share of private sector banks increases to 30 per cent of total sector assets, from current levels of 18 per cent, while that of foreign banks increases to over 12 per cent of total assets. The share of banking sector value adds to GDP increases to over 4.7 per cent. Stagnation: In this scenario, policy makers intervene to set restrictive conditions and management is unable to execute the changes needed to enhance returns to shareholders and provide quality products and services to customers. As a result, growth and productivity levels are low and the banking sector is unable to support a fast -growing economy. This scenario sees limited consolidation in the sector and most banks remain sub -scale. New private sector banks continue on their growth trajectory of 25 per cent. There is a slowdown in PSB and old private sector bank growth. The share of fo reign banks remains at 7 per cent of total assets. Banking sector value ads, meanwhile, is only 3.3 per cent of GDP. NEED TO CREATE A MARKET-DRIVEN BANKING SECTOR WITH ADEQUATE FOCUS ON SOCIAL DEVELOPMENT The term policy makers used in this document, As mentioned earlier, refers to the Ministry of Finance and the RBI and includes the other relevant Government and regulatory entities for the Banking sector. We believe a co -ordinate effort Between the various entities is required to Enable positive actio n. This will spur on the performance Of the sector. The policy makers need to make co -ordinated efforts on six fronts: Help shape a superior industry structure in a Phased manner through managed consolidation and by enabling capital availability. This wo uld create 3-4 global sized banks controlling 35 -45 per cent of the market in India; 6 -8 national banks controlling 20-25 per cent of the market; 4-6 foreign banks with 15-20 per cent share in the market, and the rest being specialist players (geographical or product/ segment focused). Focus strongly on social development by moving away from universal directed norms to an explicit incentive -driven framework by introducing credit guarantees and market subsidies to encourage leading public sector, private and foreign players to leverage technology to innovate and profitably provide banking services to lower income and rural markets. Create a unified regulator, distinct from the central bank of the country, in a phased manner to overcome supervisory difficulties and reduce compliance costs. Improve corporate governance primarily by increasing board independence and accountability. Accelerate the creation of world class supporting infrastructure (e.g., payments, asset reconstruction companies (ARCs), credit bureaus, back-office utilities) to help the banking sector focus on core activities. Enable labor reforms, focusing on enriching human capital, to help public sector and old private banks become competitive. NEED FOR DECISIVE ACTION BY BANK MANAGEMENTS Management imperatives will differ by bank. However, there will be common themes across classes of banks: PSBs need to fundamentally strengthen institutional skill

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levels especially in sales and marketing, service operations, risk management and the overall organizational performance ethic. The last, i.e., strengthening human capital will be the single biggest challenge. Old private sector banks also have the need to fundamentally strengthen skill levels. However, even more imperative is their need to examine their participation in the Indian banking sector and their ability to remain independent in the light of the discontinuities in the sector. New private banks could reach the next level of their growth in the Indian banking sector by continuing to innovate and develop differentiated business models to profitably serve segments like the rural/low income and affluent/ HNI segments; actively adopting acquisitions as a means to grow and reaching the next level of performance in their service platforms. Attracting, developing and retaining more leadership capacity would be key to achieving this and would pose the bigges challenge. Foreign banks committed to making a play in India will need to adopt alternative approaches to win the race for the customer and build a value-creating customer franchise in advance of regulations potentially opening up post 2009. At the same time, they should stay in the game for potential acquisition opportunities as and when they appear in the near term. Maintaining a fundamentally lo ng-term value-creation mindset will be their greatest challenge. The extent to which Indian policy makers and bank managements develop and execute such a clear and complementary agenda to tackle emerging discontinuities will lay the foundations for a high -performing sector in 2011.

Listing Details - Canara Bank

Key Dates

Year Ending Month AGM Date (Month) Book Closure Date (Month)
Listing Information Face Value Of Equity Shares Market Lot Of Equity Shares BSE Code NSE Code BSE Group

Mar Jul Jul

10 1 532483 CANBK A

Whether The Company Forms A Part Of The Following Indices -

Sensex Nifty BSE-100 BSE-200 S&P CNX 500 CNX Midcap CNX FMCG

No No No Yes Yes No No

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Listing On

Listed On

The Stock Exchange, Mumbai, National Stock Exchange of India Ltd.

Capital Structure (Canara Bank)

Period Fro To m 2010 2011 2009 2010 2008 2009 2007 2008 2006 2007 2005 2006 2004 2005 2003 2004 2002 2003

Instrument

Authorized Capital (Rs. cr) 3000 3000 1500 1500 1500 1500 1500 1500 1500

Issued Capital - P A I D U P (Rs. cr) 443 410 410 410 410 410 410 410 410 Shares (nos) 443000000 410000000 410000000 410000000 410000000 410000000 410000000 410000000 410000000 Face Value 10 10 10 10 10 10 10 10 10 Capit al 443 410 410 410 410 410 410 410 410

Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share

Dividend Declared

Announcement Effective Date Date 05-05-11 06-07-11 28-04-10 14-06-10 29-04-09 08-07-09 28-04-08 10-06-08 03-05-07 26-06-07 24-04-06 14-06-06

Dividend Type Final Final Final Final Final Final

Dividend Remarks (%) 110.00 100.00 80.00 80.00 AGM 70.00 AGM 66.00 AGM

Profit & Loss account of Canara Bank

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------------------- in Rs. Cr. -------------------

Mar '07 Mar '08 12 mths 12 mths Income Interest Earned Other Income Total Income Expenditure Interest expended Employee Cost Selling and Admin Expenses Depreciation Miscellaneous Expenses Preoperative Exp Capitalised Operating Expenses Provisions & Contingencies Total Expenses 11,364.56 14,200.74 1,511.80 2,308.31 12,876.36 16,509.05 7,337.73 10,662.94 1,609.29 1,661.28 957.77 1,491.09 148.18 169.97 1,402.58 958.76 0.00 0.00 3,023.26 3,666.30 1,094.56 614.80 11,455.55 14,944.04 Mar '07 Mar '08 12 mths 12 mths 1,420.81 1,565.01 0.00 0.00 0.00 0.00 1,420.81 1,565.01 0.00 0.00 287.00 328.00 48.78 56.00 34.65 70.00 197.83 362.21 722.82 335.78 38.17 80.00 202.33 802.00 379.01 384.00

Mar '09 12 mths 17,119.05 2,427.10 19,546.15 12,401.25 1,877.15 1,540.27 173.64 1,481.42 0.00 3,965.24 1,107.24 17,473.73 Mar '09 12 mths 2,072.42 0.00 0.00 2,072.42 0.00 328.00 55.75 50.55 80.00 244.87 1,508.64 180.03 383.75 0.00 2,072.42

Mar '10 12 mths 18,751.96 3,000.82 21,752.78 13,071.43 2,193.70 2,164.65 155.13 1,146.44 0.00 4,903.79 756.13 18,731.35 Mar '10 12 mths 3,021.43 0.00 0.00 3,021.43 0.00 410.00 70.00 73.69 100.00 305.83 1,676.35 865.08 480.00 0.00 3,021.43

Mar '11 12 mths 23,064.01 2,826.98 25,890.99 15,240.74 2,954.84 1,817.82 151.36 1,700.34 0.00 5,420.49 1,203.87 21,865.10 Mar '11 12 mths 4,025.89 0.00 0.00 4,025.89 0.00 487.30 80.00 90.88 110.00 405.00 1,765.29 1,693.30 567.30 0.00 4,025.89

Net Profit for the Year Extraordionary Items Profit brought forward Total Preference Dividend Equity Dividend Corporate Dividend Tax Per share data (annualised) Earnings Per Share (Rs) Equity Dividend (%) Book Value (Rs) Appropriations Transfer to Statutory Reserves Transfer to Other Reserves Proposed Dividend/Transfer to Got Balance c/f to Balance Sheet Total

0.00 0.00 1,420.81 1,565.01

Balance Sheet of Canara Bank

Mar '07 12 mths

Mar '08 12 mths

Mar '09 12 mths

Mar '10 12 mths

Mar '11 12 mths

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Capital and Liabilities: Total Share Capital Equity Share Capital Share Application Money Preference Share Capital Reserves Revaluation Reserves Net Worth Deposits Borrowings Total Debt Other Liabilities & Provisions Total Liabilities

410.00 410.00 410.00 410.00 0.00 0.00 0.00 0.00 7,701.11 7,885.63 2,242.87 2,204.86 10,353.98 10,500.49 142,381.45 154,072.42 1,574.35 2,517.23 143,955.80 156,589.65 11,651.25 13,438.55 165,961.03 180,528.69 Mar '07 Mar '08 12 mths 12 mths 9,095.19 7,278.74 13,364.79 4,513.25

410.00 410.00 0.00 0.00 9,629.61 2,168.16 12,207.77 186,892.51 7,056.61 193,949.12 13,488.91 219,645.80 Mar '09 12 mths 10,036.79 6,622.99 138,219.40 57,776.90 4,440.07 1,510.61 2,929.46 0.00 4,060.26 219,645.80 136,851.39 25,757.73 244.87

410.00 410.00 0.00 0.00 12,129.11 2,132.68 14,671.79 234,651.44 8,440.56 243,092.00 6,977.30 264,741.09 Mar '10 12 mths 15,719.46 3,933.75 169,334.63 69,676.95 4,480.37 1,620.99 2,859.38 0.00 3,216.92 264,741.09 110,627.02 21,206.47 305.83

443.00 443.00 0.00 0.00 17,498.46 2,098.36 20,039.82 293,972.65 14,261.65 308,234.30 7,804.64 336,078.76 Mar '11 12 mths 22,014.79 8,693.32 212,467.17 83,699.92 4,686.15 1,841.74 2,844.41 0.00 6,359.15 336,078.76 111,805.73 29,041.74 405.00

Assets Cash & Balances with RBI Balance with Banks, Money at Call Advances Investments Gross Block Accumulated Depreciation Net Block Capital Work In Progress Other Assets Total Assets Contingent Liabilities Bills for collection Book Value (Rs)

98,505.69 107,238.04 45,225.54 49,811.57 4,056.39 4,254.33 1,195.04 1,337.46 2,861.35 2,916.87 0.00 0.00 2,994.53 2,684.17 165,961.04 180,528.69 52,150.75 95,710.87 15,660.41 25,299.63 197.83 202.33

Cash Flow of Canara Bank ------------------- in Rs. Cr. -------------------

Net Profit Before Tax Net Cash From Operating Activities Net Cash (used in)/from Investing Activities Net Cash (used in)/from Financing Activities

Mar '07 12 mths 0.00 1535.43 -191.07 2206.02

Mar '08 12 mths 0.00 2632.60 -262.41 -866.08

Mar '09 12 mths 0.00 -990.03 -222.10 -6.13

Mar '10 12 mths 0.00 4677.03 -166.86 -1516.74

Mar '11 12 mths 0.00 8527.34 -73.22 2600.79

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Net (decrease)/increase In Cash 3550.38 and Cash Equivalents Opening Cash & Cash 12823.55 Equivalents Closing Cash & Cash 16373.93 Equivalents
Key Financial Ratios of Canara Bank

1504.11 16373.93 17878.04

-1218.26 17878.04 16659.78

2993.43 16659.78 19653.21

11054.91 19653.21 30708.12

Mar '07 Investment Valuation Ratios Face Value Dividend Per Share Operating Profit Per Share (Rs) Net Operating Profit Per Share (Rs) 10.00 7.00 33.15 282.2 4 105.5 Free Reserves Per Share (Rs) 6 Bonus in Equity Capital -Profitability Ratios Interest Spread 3.57 Adjusted Cash Margin(%) 12.81 Net Profit Margin 11.60 111.0 Return on Long Term Fund(%) 5 Return on Net Worth(%) 18.78 Adjusted Return on Net 17.51 Worth(%) Return on Assets Excluding 197.8 Revaluations 3 Return on Assets Including 252.5 Revaluations 4 Management Efficiency Ratios Interest Income / Total Funds 7.81 Net Interest Income / Total 2.86 Funds Non Interest Income / Total 0.45 Funds Interest Expended / Total Funds 4.95 Operating Expense / Total 1.94 Funds Profit Before Provisions / Total 1.27 Funds Net Profit / Total Funds 0.96

Mar '08 10.00 8.00 33.29 378.64 103.94 -3.47 10.65 9.61 151.48 18.86 18.85 202.33 256.11 9.08 2.84 0.44 6.23 2.04 1.14 0.92

Mar '09 10.00 8.00 47.02 441.97 108.33 -3.47 11.80 10.89 149.13 20.64 20.63 244.87 297.75 9.16 2.89 0.46 6.27 1.92 1.34 1.05

Mar '10 10.00 10.00 73.99 508.62 129.43 -3.32 14.46 13.77 134.69 24.09 24.07 305.83 357.85 8.69 3.24 0.45 5.45 1.98 1.65 1.26

Mar '11 10.00 11.00 89.40 552.37 202.26 -3.47 16.23 15.65 112.95 22.43 22.43 405.00 452.37 8.20 3.09 0.42 5.11 1.77 1.70 1.35

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Loans Turnover Total Income / Capital Employed(%) Interest Expended / Capital Employed(%) Total Assets Turnover Ratios Asset Turnover Ratio Profit And Loss Account Ratios Interest Expended / Interest Earned Other Income / Total Income Operating Expense / Total Income Selling Distribution Cost Composition Balance Sheet Ratios Capital Adequacy Ratio Advances / Loans Funds(%) Debt Coverage Ratios Credit Deposit Ratio Investment Deposit Ratio Cash Deposit Ratio Total Debt to Owners Fund Financial Charges Coverage Ratio Financial Charges Coverage Ratio Post Tax Leverage Ratios Current Ratio Quick Ratio Cash Flow Indicator Ratios Dividend Payout Ratio Net Profit Dividend Payout Ratio Cash Profit Earning Retention Ratio Cash Earning Retention Ratio AdjustedCash Flow Times

0.13 8.26 4.95 0.08 2.85

0.15 9.52 6.23 0.09 3.65

0.15 9.61 6.27 0.09 4.08 72.44 4.74 19.93 0.13 14.10 78.86 71.99 31.55 6.86 18.62 1.23 1.18 0.02 11.29 18.51 17.08 81.48 82.91 83.24 Mar '09 50.55 244.87

0.14 9.14 5.45 0.09 4.65 69.71 4.93 21.65 0.09 13.43 77.49 72.96 30.24 6.11 18.71 1.31 1.24 0.01 26.98 15.88 15.11 84.10 84.88 73.93 Mar '10 73.69 305.83

0.13 8.62 5.11 0.08 5.22 66.08 4.87 20.48 0.09 15.38 77.07 72.23 29.01 7.14 16.39 0.34 1.27 0.02 30.86 14.09 13.58 85.91 86.42 70.38 Mar '11 90.88 405.00

64.57 75.09 5.46 4.61

23.49 21.48 0.33 0.29

13.50 13.25 75.55 71.36 68.65 31.71 6.56 17.55 1.28 1.21 0.02 9.49 69.40 32.06 7.58 18.57 1.20 1.16 0.02 9.17

23.63 24.53 21.40 22.13 76.36 75.45 78.60 77.86 90.78 88.86 Mar Mar '08 '07 34.65 38.17 197.8 202.33 3

Earnings Per Share Book Value

Competitiors
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Last Price SBI PNB Bank of Baroda Canara Bank Bank of India Union Bank IDBI Bank Oriental Bank Allahabad Bank Indian Bank 2,482.00 1,153.90 882.65 526.90 410.55 299.10 135.25 345.05 205.60 227.30

Market Cap. (Rs. cr.) 157,606.75 36,556.95 34,671.37 23,341.67 22,466.12 19,002.72 13,316.91 10,067.22 9,790.99 9,768.67

Net Interest Income 81,394.36 26,986.48 21,885.92 23,064.02 21,751.72 16,452.62 18,600.82 12,087.82 11,014.69 9,361.03

Net Profit 8,264.52 4,433.50 4,241.68 4,025.89 2,488.71 2,081.95 1,650.32 1,502.87 1,423.11 1,714.07

Total Assets 1,223,736.20 378,325.25 358,397.18 336,078.76 351,172.55 235,984.44 233,572.01 161,343.38 151,286.36 121,718.31

PROGRESS AT A GLANCE

(Amt. in Rs. Crore)

2007-08 2008-09 2009-10

Number of Branches Paid-up Capital Reserves Aggregate Deposits Growth (%) Non-Resident Deposits Foreign Business Turnover Advances (Net) Growth (%) Retail Advances Growth (%) Priority Sector Advances Growth (%) Agriculture Growth (%) Agriculture(Disbursal)

2678 410 10091 154072 8.21 12874 136757 107238 8.86 17665 1.03 43203 14.16 17996 15.95 11443

2733 410 11798 186893 21.30 14043 142301 138219 28.89 19798 12.07 48763 12.87 20144 11.94 14704

3046 410 14262 234651 25.55 13567 127614 169335 22.51 23902 20.73 59310 21.63 25051 24.36 18130

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Micro, Small and Medium Enterprises Growth (%) Advances under DRI Scheme Advances to SC/ST Clients Self Help Group (Nos.) Export Credit Clientele (In Million) Total Number of Staff Total Income Total Expenditure Operating Profit Net Profit

18600 30.57 40 2055 210441 9162 32.35 45260 16414 13454 2959 1565

23823 28.08 48 2863 275100 8967 34.80 44090 19430 15467 3964 2072

31074 30.44 50 3905 320000 8966 37.34 43380 21610 16549 5061 3021

SWOT ANALYSIS

STRENGTHS - Leadership in Karnataka state - Diversified loan book - Comfortable capital and reserve levelsWEAKNESSES - Declining asset quality to impact margins - Low international exposure OPPORTUNITIES - Foray into high growth areas likely to broaden fee income sources - Government support to boost capital strength - Government initiatives likely to spur demand in financial transactions THREATS - Weak monsoon likely to impact rural credit off -take - Declining exports likely to subdue trade financing demand in India - Intensifying competition likely to check growth opportunities

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McKinsey 7S Model

This model was developed in the 1980's by Robert Waterman, Tom Peters and Julian Philips whilst working for McKinsey and originally presented in their article Structure is not Organization". To quote them: "Intellectually all managers and consultants know that much more goes on in the process of organizing than the charts, boxes, dotted lines, position descriptions, and matrices can possibly depict. But all too often we behave as though we didnt know it - if we want change we change the structure. Diagnosing and solving organizational problems means looking not merely to structural reorganization for answers but to a framework that includes structure and several related factors." The 7S Model which they developed and presented became extensively used by mangers and consultants and is one of the cornerstones of organizational analysis.

Essentially the model says that any organization can be best described by the seven interrelated elements shown above: Strategy Plans for the allocation of a firm's scarce r esources, over time, to reach identified goals. Environment, competition, customers. Structure

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The way the organization's units relate to each other: centralized, functional divisions (top-down); decentralized (the trend in larger organizations); matrix, n etwork, holding, etc. Systems The procedures, processes and routines that characterize how important work is to be done: financial systems; hiring, promotion and performance appraisal systems; information systems. Skills Distinctive capabilities of personn el or of the organization as a whole. Staff Numbers and types of personnel within the organization. Style Cultural style of the organization and how key managers behave in achieving the organizations goals. Shared Value The interconnecting centre of McKin sey's model is: Shared Values. What the organization stands for and what it believes in. Central beliefs and attitudes.

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