The Nav Jeevan Co-operative Bank...

The Nav Jeevan Co-operative Bank Ltd.

BOARD OF DIRECTORS

Shri Sitaldas Harchandani

(Chairman)

Dr. Manohar Makhija

(Vice Chairman)

Shri Bacharam Rupchandani

Shri Jawahar Watwani

Shri Hundraj Bhatia

Dr. Rakesh Udasi

Smt. Neeta Dhirwani

Shri Suresh Mane

Shri Suresh Harchandani

Shri Bhim Badga


BOARD OF DIRECTORS

Shri Santosh Nankani

Shri Murlidhar Sabhandasani

Shri Lal Hiranandani

Dr. Kanhaiyalal Nathani

Shri Anil A. Ballani

Shri Haresh Gyanchandani

Shri Pradeep Bijlani

(Co. opt. Director)

Shri Dinesh Wadhwani

(Co. opt. Director)


NOTICE OF THE ANNUAL GENERAL MEETINGNotice is hereby given that the 33rd Annual General Meeting of the Members of The Nav Jeevan Co-op Bank Ltd., Ulhasnagar, will be held on Sunday, the 13th August, 2017 at 11.00 a.m. at Regency & Regal Hall, 2nd floor, Anil Complex, New Link Road , Near Sapna Garden, Ulhasnagar-3 to transact the following business:

1. To read and confirm the minutes of the last Annual General Body Meeting held on 21st August, 2016 and Minutes of Special General Body Meeting held on 18th June, 2017.

2. To consider and adopt the Annual report of the Bank for the F.Y. 2016-17, Audited Profit & Loss account for the year ended 31st March, 2017 and Balance Sheet of the Bank as on that date.

3. To consider and adopt Statutory Auditor’s Report from M/s. R. Devendra Kumar & Associates, for the F.Y. 2016-17, and also rectification report of the earlier audit.

4. To approve the appropriation of Profit as recommended by the Board of Directors for the F.Y. 2016-17 and to declare the Dividend.

5. To seek approval of General Body for appointment of Statutory Auditor of our Bank for the FY 2017-18 in terms of guidelines of Maharashtra Co-op. Societies Act, from the list of panel of Statutory Auditors approved by the Co-op. Dept., Maharashtra State, Pune and authorize the Board of Directors to fix their remuneration.

6. To take note of the Annual Budget of the Bank for the F.Y. 2017-18.

7. To consider Statement showing Loans and advances to directors and their relatives as on 31st March, 2017.

8. To consider and approve amendments to the Bye-Laws of the Bank as notified separately.

9. To transact any other business with the permission of the chair.

Place: Ulhasnagar By order ofDate: 03/07/2017 Board of Directors

Sd/-

Note:

1. If the Meeting is postponed for want of quorum, the same will be held at 11.30 a.m. on the same day at the same place and the agenda of the meeting will be transacted at such meeting irrespective of the quorum.

2. Members desiring to have any information or offer suggestions or put any questions are requested to do so in writing/E-mail the same to Head Office of the Bank atleast five days in advance before the date fixed for the meeting. Please note that Questions not related to agenda will not be discussed in the meeting.

3. Members who have not collected dividend for the year 2013-14, are requested to collect the same immediately; if not collected before March 31, 2018, the same will be forfeited and transferred to Reserve Fund in accordance with the provisions of bye-laws. The information may be treated as official notice to the concerned members.

4. Share certificates are ready till date and all shareholders are earnestly requested to collect their Share Certificates from the Bank at the earliest and also to inform change of address, if any.

5. Inspite of our repeated requests, the members are not informing change in address, due to which the Notice of AGM and dividend warrants are returned back undelivered. The members are once again requested to intimate their correct address to Head Office, failing which the Notices and dividend warrants will not be mailed to them in future.


The Nav Jeevan Co-operative Bank Ltd. Head Office: Bhawani Saw Mills Compound, Ulhasnagar -3

ATTENDANCE SLIP

33rd Annual General Meeting 13th August, 2017.

Membership No. :___________

I certify that I am a regular member of The Nav Jeevan Co operative Bank Ltd. I hereby record my presence at the 33rd Annual General Meeting of the Bank at 11.00 a.m. on Sunday, the 13th August, 2017 at Regency & Regal Hall, 2nd floor, Anil Complex, New Link Road, Near Sapna Garden, Ulhasnagar- 421 003.

_____________________________ ____________________________

Member’s Name in BLOCK Letters Member’s Signature

Note: Please fill this Attendance Slip and hand it over at the Entrance of the Hall.




Awards over last 3 decades

... where service is way of life

10


10.0

11.0

12.0

13.0

14.0

15.0

16.0

17.0

18.0

2016-172015-162014-152013-142012-13

CAPITAL ADEQUACY (CRAR)

Perce

nta

ge

15.5

17.3

16.4

15.6

13.1

` in C

rores

50

58

66

74

82

90

2016-172015-162014-152013-142012-13

OWNED FUNDS

67

73

7982

87

BREAK UP OF ADVANCES 31.03.20178.4%

14.6%

1.7%

1.1%

6.5%

67.7%

Trade & Commerce

Education

SSI

Other Priority Sector

Constn/Housing

Non Priority

BREAK UP OF DEPOSITS 31.03.2017

27.3%

66.9%

5.8%

Saving Current Term Deposits

INCOME EARNED DURING 2016-17EXPENSES INCURRED DURING 2016-179.3%

0.1%

37.7%

52.9%

Int. recd. On Loans & Adv.

Int. recd. On Investments

Exchange & Commission

Other receipts

8.7%4.3%

8.8%

6.8%

6.1%

10.3%

55.0%

Interest On DepositsRent/Taxes/lighting & InsuranceRisk Provision

Salaries All. & Ex Gratia

Net Profit

Other ExpensesProvision for Taxes

11


400

450

500

550

600

650

700

2016-172015-162014-152013-142012-13

DEPOSITS

` in C

rores

468

524

567 564

644

` in C

rores

300

320

340

360

380

400

420

440

2016-172015-162014-152013-142012-13

ADVANCES

301

336

356 357

420

9.0

9.5

10.0

10.5

11.0

11.5

12.0

12.5

13.0

13.5

14.0

2016-172015-162014-152013-142012-13

OPERATIONAL PROFIT

` in C

rores

` in C

rores

12.3

9.8

11.711.4

13.7

750

800

850

900

950

1000

1050

1100

2016-172015-162014-152013-142012-13

BUSINESS MIX

769

924 923 921

1064

0

2

4

6

8

10

12

14

16

2016-172015-162014-152013-142012-130.0%

1.0%

2.0%

3.0%

4.0%

5.0%

2.6%2.9%

4.3%

2.3%

0.0%0 7 1510 10

%NET NPA%Gross NPA

4

9

14

19

24

29

2016-172015-162014-152013-142012-131.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

6.2%

7.5%

5.9%

5.2%

1.7%

5 18 21 27 26

12


Dear Members,It gives me immense pleasure in welcoming you all for the 33rd AGM of our Bank and presenting to you our Annual Report together with Audited Balance Sheet & Profit and Loss Account for the year ended 31st March, 2017. Before I proceed to share and place before you the Performance highlights & happenings of the Bank for the Financial Year 2016-17, let me share with you briefly the Economic and Financial environments which had strong bearing on the overall performance of the Bank. Economic & Banking Scenario: The withdrawal of U.K from the European Union popularly known as BREXIT, an event that occurred in June, 2016, affected the Indian economy to a certain extent as many Indian business houses have their offices at Britain as well. Demonetisation- a very bold step by the Government of India intending to curb the black money menace and bringing down the circulation of Counterfeit notes used for funding of illegal activities and terrorism. The sudden announcement created disruption throughout the economy and the Banking sector due to Cash Shortages thereby lowering the Sales of products and slowing down payment cycles, etc. Demonetisation increased the liquidity in the Banking System. The situation of excess liquidity still persists due to low credit off take.The Parliament of India has cleared the long awaited Goods and Services Tax (GST) Bill and the same is expected to come into effect by July, 2017. The GST is a Value added Tax (VAT) proposed to be a comprehensive indirect tax levy on manufacture, sale and consumption of goods as well as services at the national level. It will replace all indirect taxes levied on goods and services by the Indian Central and state governments.

Amalgamating several Central and State taxes into a single tax would mitigate cascading or double taxation, facilitating a common national market. The simplicity of the tax should lead to easier administration and enforcement. From the consumer point of view, the biggest advantage would be in terms of a reduction in the overall tax burden on goods, which is currently estimated at 25%-30%, free movement of goods from one state to another without stopping at state borders for

CHAIRMAN’S SPEECHhours for payment of state tax, entry tax and reduction in paperwork to a large extent. If GST results in increasing economic growth, banking sector will be able to grow at a faster pace. Improving economic scenario of the country should result in abundant opportunities for the financial sector over the coming years.

In terms of Annual GDP Growth, India remains the fastest growing major economy in the world. The 7.1% growth was in line with the Government estimates. The Indian economy slowed sharply in the January-March quarter to 6.1%, down from 7% in the previous quarter, while the overall pace of growth of 2016-17 moderated to the three year low of 7.1%.The dip was due to the impact of Government’s move to scrap some high value notes last November hurting various sectors where Construction was worst hit followed by Services. The economy was expected to gather pace in the fiscal gone by with favourable monsoon and wage increase post-implementation of the 7th Pay Commission, which was expected to spur consumption in the second half of the fiscal. However, Demonetisation temporarily slowed down economic activities in the 3rd quarter due to liquidity crunch.

Going ahead we expect GDP growth to rebound in 1HFY18 on the back of good monsoons, softer interest rates and bounce back in exports.

The key concern for the domestic banking sector as well as the regulator is the sharp rise seen in NPAs, mainly for the PSU banks. Though some private sector banks have also seen a surge in level of NPAs, it is not as drastic as in case of PSUs. The trend of net losses and higher provisioning which started from 3Q of FY15-16, continued in FY16-17 as well for PSU banks. RBI has been focused on clean up of balance sheets of PSU banks. Recently, enforced PCS framework allows RBI to take strict action against banks, which do not meet the criteria for NPA, CRAR and other capital ratios. RBI has already taken action against 3 PSU banks and is continuously evaluating other banks as well. The clean-up requires additional capital infusion especially for PSU banks to make additional provisions. The central government, however, is looking towards amalgamation of weaker banks with stronger banks to satisfy the need for capital infusion for weaker banks. SBI associates merger with SBI is a recent example of such action.

13


Financial Highlights:(` In Crores)

Particulars 31.03.17 31.03.16 % Increase/

(Decrease)Owned funds 87.22 81.84 6.57

Deposits 644.47 564.04 14.26

Advances 419.51 357.43 17.37

Working Capital 752.62 656.00 14.73

Gross Profit 13.65 11.39 19.84

Net Profit 6.66 6.84 (2.63)

Gross NPA 25.92 26.81 (3.32)

Gross NPA % 6.18% 7.50% (1.32)

Net NPA 10.46 14.85 (29.6)

Net NPA % 2.59% 4.30% (1.71)

Cost of Deposits 7.10% 7.85% (0.75)

CRAR 13.04% 15.61% (2.57)There has been substantial rise in Capital and Reserves over last five years at annualized growth rate of around 9% with total Reserves of the Bank comfortably placed at `87.22 Crores as at 31st March, 2017.The Total Deposits of our Bank have increased by `80 crores to `644 crores as against Rs 564 Crores as at end of 31st March, 2016, at Annual growth rate of over 14%. There was a sharp surge in Deposits during the Demonetisation period as the depositors were depositing SBNs with Banks. Withdrawals from the accounts grew steeply at the end of the process.

(ìn crores)

Type of Deposits

2016-17 % 2015-16 %

Current 37.41 5.80 30.13 5.34

Savings 176.14 27.33 129.80 23.01

Term 430.92 66.87 404.10 71.65

Total 644.47 100 564.03 100The Bank used all its resources and did the best it could to cater to the Cash need of the Customers during the challenging time. I on behalf of my Board, express my sincere thanks to our customers for their co operation and support extended during Demonetisation.Total Advances of our Bank have increased by `62 Crores during the year from `357.4 Crores to `419.51

Crores, at Annual growth rate of over 17%.Total Working Capital of the Bank has been rising steadily over last five years with annualized growth rate of about 15% at `752.62 Crores as on 31st March, 2017.Despite stable Macro-economic environment across most sectors, our Bank has shown good growth in terms of total business mix of `1064 Crores as against total business of ̀ 921 Crores as on 31st March, 2016, at Annual growth rate of over 15% as well as the Profit, showing an improvement of 20% YoY. The Bank has been able to record highest Profit of ̀ 13.65 Crores (Before Tax and provisions) –as against the Profit of `11.39 Crores of last year. Going forward, we expect economy to pick up with GST being the primary driver which should push unorganized sectors into the mainstream. In addition, good monsoons, 7th Pay Commission and moderate inflation should drive domestic consumption and investment. As a result, for 2017-18, we are looking at Business Target of over `1200 Crores.Statutory Requirements:Adequacy & quality of Capital is the most essential requirement for any sound and healthy Bank. As against RBI stipulation of 9% for CRAR (Capital to Risk Asset Ratio), CRAR of our Bank stands at a healthy level of 13.04% as on 31st March, 2017.Further, our Core Capital consisting of Share Capital, Statutory Reserves and other Free Reserves constitute about 88% of the total Capital funds of the Bank, which is a sign of healthy net worth position. Disclosures:All Deposits of our Bank upto `1.0 lac per Depositor are covered under guarantee scheme of Deposit Insurance & Credit Guarantee Corporation of India, for which our Bank has been paying regular premium. During the F.Y. 2016-17, the Bank has paid total premium of `65.78 Lacs.Social Responsibilities:Although we are a Co-op. Bank working on the lines of sound commercial Banks, we are very much focused on our social obligations. As a responsible Socio-economic Bank of the region, the Bank is taking care of social causes by catering to the financial needs of weaker section & middle class by granting marriage loans for girls, loans for education to underprivileged students at very low rate and loans for medical expenses etc. to lower income group people. The total

14


number of loans sanctioned for such social causes are 55 amounting to `243.66 lacs during the year.

Senior Citizens enjoy special status in our Bank for Deposit Schemes with higher rate of Interest & additional Door Service available on request.

In order to motivate and encourage the wards of our members, Bank felicitates meritorious student children of our Shareholder members with prize money in the form of Deposit and Memento for their excellence in education and academics.

Non-Banking Services:

Like any other Corporate Bank, the non Banking services constitute an important part of our services. Our Bank has the distinction of being the first and only Bank in Ulhasnagar to start Franking Services in the year 2007 and also the only Bank in Kopri Colony, Thane (East) in the year 2010 to start Franking Services. Our Bank continues to perform well and create new records/milestones for Franking Services under Non-Banking business. During the year ended 31st March, 2016 the Bank has done Franking business of over `13.44 Crores with 2.0 lac documents franked and generated income of `20.10 lacs. A brief review of Franking business of our Bank from its inception will highlight our performance.

Yearly Performance

Financial Year

Amount Franked(ìn Lacs)

No. of Documents Franked

2016-17 1448.46* 194559*

2015-16 1344.39* 201440*

2014-15 1907.30 191116

2013-14 11689.20 154799

2012-13 11003.00 112089

2011-12 9190.00 104209

2010-11 6864.90 90438

* (incl. e-SBTR & simple R)As per Notification dtd.30.12.13 from the Office of the IGR Stamps Pune, franking of stamp duty up to `5000/- only will be made at our Bank and above that will be done Online i.e. through e-SBTR . As a result Bank’s revenue from franking business has come down significantly.

Under Non Banking Business, the Bank provides General Insurance solutions to its customers under

the tie-up arrangement with ICICI Lombard group. For Life Insurance agency, our bank is evaluating various proposals and a tie-up is expected soon.

E-Payment service i.e. Online payment of Central Excise & Service Tax, all types of Direct taxes, MVAT, Luxury Tax, Motor Tax ,etc., has been made available for our esteemed Retailed/Corporate Customers since Sept.,2016 under tie-up arrangement with IDBI Bank. The .Bank has made 698 E-Payments to the tune of `777.18 lacs upto March, 2017.

The Bank proposes to start services of ”The Bharat Bill Payment System” (BBPS) which is a RBI mandated system which offers integrated and interoperable bill payment services to customers across geographies with certainty, reliability and safety of transactions.

The total Revenues earned by the Bank under Non-Banking services are `20.10 Lacs during the Financial Year. Our Bank is targeting a substantial jump in non-banking revenues and is planning to offer additional services to our customers.

NPA ManagementDuring the year under review, in terms of RBI guidelines we classified stressed Assets falling under Asset Quality review as NPAs and accordingly strictly observed stipulated norms.

Our Recovery Department made vigorous efforts in recovering NPA dues, however for the reasons of demonetization from November 2016 onwards it badly affected recovery process, despite this, we could recover Rs.445.04 lakhs during the year with a closure of 24 NPA A/cs & in addition to it the Team made every efforts of recovering Rs.60.69 lacs in Potential NPA a/cs thereby restricting such a/cs from slipping it to NPA for substantial amount of Rs.138.67 lacs.. The slow-down trend particularly in Textile Industry continued this year also and due to which despite recovery efforts, few accounts are added to NPA, however ultimately compared to last year, percentage has been reduced for Gross NPA by 1.32% as well as Net NPAs by 1.71% as under:

March 2016 March 2017

Gross N.P.A. 7.50% 6.18%

Net NPA 4.30% 2.59%

Overdue 7.87% 6.07%

Our efforts are continued for recovery process in top 5 NPA a/cs, but due to legal complications, results are

15


getting delayed, but we are confident that during this year we would be able to bring down these numbers significantly. Strengthening of Credit appraisals resulted in rejection of proposals which didn’t fit the parameters of Standard Proposal. Credit monitoring helped us to take timely actions against potential NPA a/cs, and continued with the spirit to bring-down NPA substantially, we are hopeful to bring down the Sub-Standard Asset level further during this year.Investments:Aggregate Investments of our Bank as on 31st March, 2017 have increased to `267.75 crores as against Rs.246.4 crores yielding an average return of 9.9%. The Bank generally follows the prudential limits set by RBI for Non-SLR Investments, however the limit was breached marginally during last year on account of large deposits received during Demonetization. We have been complying with RBI instructions with both CRR and SLR being maintained in excess of the stipulated requirements. Our Bank has been maintaining sufficient liquidity in the form of CRR with ourselves and with the Notified Banks. The Bank is also maintaining Statutory Liquidity Ratio as required under the Banking Regulation Act 1949, upto 20.5% of Net Demand & Time Liabilities in the form of holding of Central Govt. Securities. Technological Innovations: Our Bank has been putting enhanced focus on Information Technology over the last 2 years and how to best utilize it to improve Banking Services and make them more efficient. We have had mixed results from our implementation over last year. We briefly describe here the projects implemented, projects under implementation and projects under planning stage to be implemented in near future. Projects implemented:

1. CKYCR (Central KYC Records Registry) System: As per the RBI guidelines, our bank has to implement the CKYCR and DMS (Document Management System). CKYCR would be a repository of KYC records of clients of all financial sector entities. This would help a customer to avoid submitting the same KYC information with every financial sector entity whenever customer needs to open an account and also when periodic updation is due.

2. CIBIL:.In term of RBI guidelines, our Bank has become a Member of “CIBIL”- Credit Information

Bureau India Ltd and has started obtaining credit reports from them to evaluate the financial responsibility of potential borrowers to assess their financial standing and minimize instances of concurrent and serial defaults.

3. Host-to-Host (H2H) is an automated solution for high volume data transfer between banks and their corporate clients. Bank has recently started providing free of cost services of NEFT & RTGS outward transactions to our customers.

Projects under implementation:1. Record Management System: As per RBI

Guidelines Banks need to preserve their old records for a specific period. Proper record management means efficient administration. Proper storing, retrieval of documents as and when required for checking/ verification/ audit purpose and destroying them periodically is a tedious job. Further storing of record requires huge space as well as proper man power to manage the same. This entails significant investments of Time, Money & Resources.

The Bank has made arrangements for storage and maintenance of old records with Record Management Co. for proper storing and retrieval of documents as and when required where documents would be sent for storage after scanning the same.

2. Net Banking (View-Only) mode: Bank is also going to offer Net-Banking facility to its customers in View-Only mode, which can be used only for viewing of Account Balance & Account statement, Cheque Book Request, FD Request, Pass Book Request, Mobile number change request.

3. Loan Tracking System: To offer a convenience of tracking their loan application, Bank is planning to introduce a system, whereby borrower would be intimated about the status of their application through SMS at each stage of processing. We expect this system to make our loan processing system more transparent and efficient.

Projects under planning stage:

1. Direct RTGS/NEFT services: Currently, bank is offering these services under tie-up arrangement with ICICI Bank. Our Bank is planning to apply for direct membership of RBI clearing as well as separate MICR code, through which we would be able to offer direct RTGS/NEFT facility to our customers.

16


2. Immediate Payment services (IMPS): IMPS is an instant real time inter-bank electronic funds transfer systems of India. Unlike NEFT/RTGS the service is available 24x7, throughout the year including Sundays and any bank holiday. This service can be provided through various channels such as ATM, Mobile, Internet Banking, etc. Our bank is planning to provide this service initially through ATMs only, which would be later on extended to other channels as well.

3. Mobile Banking: We expect to launch Mobile Banking Service soon. Till now, the only mobile banking services were offered were SMS services, also known as SMS banking. With the introduction of smart phones, Mobile banking has become much more powerful and accessible. Through our Mobile Banking, customers would be empowered to do funds transfer, request Cheque-book, request Deposit, and other value added services.

Besides these projects, our Bank continues to evaluate other technology driven projects. The sole criterion for considering any project is to offer additional services and/or to improve the quality of our existing services. Profitability:

(Rs.in crores)

Particulars 2016-17 2015-16

Profit before Tax & Provisions 13.65 11.39

Profit after Tax & Provisions 6.66 6.84Inspite of economic challenges during F.Y.2016-17 the bank has been able to maintain Profit at a Healthy level of `13.65 crores as at the end of 2017 after making Balance Sheet adjustment entries of Rs.4.44 crores.Dividend:The Board of Directors are pleased to recommend a dividend of 15% p.a. to our members for the year 2016-17, which is maximum under the Maharashtra Co-operative Society Act 1960 and a very good return on par value to our Stakeholders, maintained by the Bank over a number of years. Our bank has been paying Dividend at the highest permissible rate of 15% since last 24 years. Appropriation of Profit for F.Y. 2016-17:Subject to approval of Annual General Meeting Capital Adequacy:Bank’s Capital to Risk Weighted Assets Ratio (CRAR) increased to 13.04% as on 31st March, 2017

as against the previous year’s 15.61% which is well above the MRL of 9% in the Banking Sector.Membership:The total No. of Members of the Bank as on 31st March, 2017 stood at 5678.Appointment of Statutory Auditor:The Board recommends to the General Body, appointment of M/s. R. Devendra Kumar & Associates Chartered Accountants for the FY 2017-18.The resolution for their appointment will be moved under agenda item no.5 of the notice.Obituary:We deeply mourn the death of members of the Bank, customers and well-wishers who passed away during the year under report.Acknowledgements:Any growing organization cannot do so without the co-operation and co-ordination of its stakeholders. First of all, I would like to thank all our customers, which have enabled us to grow our business year after year. I would once again like to thank our members, who have given us an opportunity once again, to take bank to new heights and milestones.The Board is grateful to The Reserve Bank of India, Commissioner for Co-operation and Registrar, Co-operative Societies, Maharashtra State, Pune, Joint Registrar, Maharashtra Co-operative Society, C.B.D., District Deputy Registrar, Maharashtra Co-operative Society, Thane, Assistant Registrar, Co-operative Society, Kalyan and National Payment Corporation of India (NPCI), our Bankers for their support and guidance. I take this opportunity to thank my Colleagues on the Board for the valuable guidance, support and prudent counsel.I would like to acknowledge the contribution and hard work put in by our staff members. Without their sincere efforts and dedication, we would have not been able to achieve so many milestones. Our bank is well-known and is growing on back of our customer service, which would have not been possible in absence of committed staff members.I take this opportunity to assure you that with continued support of you all, your Bank will continue the journey of progress and prosperity and shall continue its endeavour to do so in the times ahead.Thanking you all,Sd/-Shri Sitaldas K HarchandaniCHAIRMAN

17


AMENDMENTS TO BYE-LAwSSr. No.

Existing Bye Law No.

Existing Provision Proposed Amendment Reason

1 1

The Name of the Bank shall be “The Nav Jeevan Co operative Bank Ltd.”, and is a society registered under MCS Act 1960

The Name of the Bank shall be changed to “The Nav Jeevan Co operative Bank Ltd.” With the deletion of the word “The” and is a society registered under MCS Act 1960. Additionally, acronym NJCB to be used interchangeably as the name of the bank.

Ease of use, to create an effective brand through more effective recognition. To match the name with the oral usage. Usage of acronym is common in emails, SMSs and other electronic communication channels.

2 4 (ix)

‘Person’ means an adult individual, competent to contract under Section 11 of the Indian Contract Act, 1872 ( 9 of 1872), proprietary concern in proprietor’s individual capacity, partnership firm duly registered under the Indian Partnership Act, 1932, Hindu undivided family formed under Hindu Law, company or any other body corporate constituted under the law for the time being in force, society registered under the Societies Registration Act of 1860, and State Government and Public Trust registered under any law for the time being in force for registration of such trusts subject to amendment in the Act.

‘Person’ means an adult individual, competent to contract under Section 11 of the Indian Contract Act, 1872 ( 9 of 1872), proprietary concern in proprietor’s individual capacity, partnership firm duly registered or has Applied for registration under the Indian Partnership Act, 1932, Hindu undivided family formed under Hindu Law, company or any other body corporate constituted under the law for the time being in force, society registered under the Societies Registration Act of 1860, and State Government and Public Trust registered under any law for the time being in force for registration of such trusts subject to amendment in the Act.

To facilitate firms which are under process of registration under Partnership Act, 1932, to be enrolled as Members of the Bank. The amendment is required as partnership registration process can take up to 2 years to be completed.

3 8

The Authorized Share capital of the Bank is `12,00,00,000/- (Rupees Twelve crores) divided into forty eight lacs shares of `25/- each.

The Authorized Share Capital of the Bank is `20,00,00,000/- (Rupees Twenty crores) divided into Eighty Lacs shares of `25/- each.

The amendment is proposed considering the Capital is likely to be fully issued, Subscribed and paid-up during the current F.Y and fresh capital will be required for future growth and Business requirements of the Bank.

4 3

Area of Operation of the Bank shall be confined to the Kokan Division i.e. Districts of Thane; Raigad; Sindhudurg and Ratnagiri.

To extend the area of Operation from Kokan Division to other adjacent districts including Mumbai, Mumbai suburban & Palghar, Pune, Satara, Nashik, and Ahmednagar Districts and to extend the same from Kokan Division to the entire State of Maharashtra.

To increase Area of Operation and Business

5 22

A member may withdraw or resign his membership after one year and giving at least one month notice in writing and withdraw his share capital with the approval of the Board. The approval shall not be given while such a member is indebted to the Bank either as a borrower of surety.

A member may withdraw or resign his membership after one year and giving at least one month notice in writing and withdraw his share capital with the approval of the Board/ any Competent Authority of the Bank consisting of the Chairman/MD cum CEO/ Dy. CEO. The approval shall not be given while such a member is indebted to the Bank either as a borrower of surety.

The Board meeting is conducted once in a month, some of the members are in urgent need of funds so any of the competent authority can approve the withdrawal of membership.

18


BALANCE SHEET AS AT 31ST MARCH 2017CAPITAL & LIABILITIES Schedule Current Year

31.03. 2017Amount (`)

Previous Year31.03.2016Amount (`)

1) SHARE CAPITAL: A I) Authorised Capital 48,00,000 Shares of `25/- each 12,00,00,000.00 12,00,00,000.00 II) Issued Subscribed & Paid up Capital

4235238 (3907199) shares of `25/- each fully paid

10,58,80,950.00 9,76,79,975.00

2) RESERVE FUND & OTHER RESERVES B 69,78,16,828.37 65,11,55,564.62 3) DEFFERED TAX LIABILITY 7,48,405.36 3,33,986.36 4) DEPOSITS & OTHER ACCOUNTS C 6,44,47,35,546.92 5,64,03,68,089.75 5) BORROwINGS: - - 6) BILLS FOR COLLECTION BEING BILLS

RECIEVABLE AS PER CONTRA 1,35,000.00 6,31,986.00

9) BRANCH ADJUSTMENT ACCOUNT - - 7) OVERDUE INTEREST RESERVE 14,90,49,658.92 9,90,99,095.34 8) INTEREST PAYABLE 3,12,27,990.11 2,46,28,060.48 9) OTHER LIABILITIES & PROVISIONS D 17,70,96,537.51 7,62,37,768.45 10) GRATUITY FUND 2,98,25,713.23 2,86,32,723.54 11) PROFIT & LOSS (incl. Balance of Profit) E 6,84,78,677.59 6,95,97,003.71GRAND TOTAL 7,70,49,95,308.01 6,68,83,64,253.25 CONTIGENT LIABILITIES 2,45,22,268.00 4,11,12,775.00

Schedule Q: Notes to accounts and significant accounting policies

Place : UlhasnagarDate : 2nd July, 2017

On Behalf of the Board of DirectorsTHE NAV JEEVAN CO-OP. BANK LTD

Sd/- Sd/- Sd/-Shri Sitaldas k. Harchandani Dr. Manohar Makhija Bacharam Rupchandani Chairman Vice Chairman Director

Sd/-Lal Hiranandani Shri Dinesh S. Harchandani Director MD-cum-CEO

Sd/-Statutory AuditorsFor IdentificationIn term of our report of even dateFor R.Devendra Kumar & Associates Concurrent AuditorsChartered Accoutants For Sunny Gopichand BhagiaFRN : 114207W Chartered Accoutants

Sd/-(Neeraj Golas) (Sunny G. Bhagia)Partner ProprietorM. No. 074392 M. No. 138716

19


BALANCE SHEET AS AT 31ST MARCH 2017ASSETS

Schedule Current Year

31.03.2017 Amount (`)

Previous Year 31.03.2016 Amount (`)

1) CASH : 7,20,81,276.75 3,55,16,668.95

2) BALANCES wITH OTHER BANKS: F 69,33,78,451.55 93,67,90,663.49

3) INVESTMENTS: G 2,34,28,91,583.50 1,82,53,10,354.00

4) LOANS AND ADVANCES: H 4,19,50,62,636.77 3,57,42,93,901.83

5) INTEREST RECIEVABLE : I 21,45,10,542.13 17,67,62,221.58

6) BILLS RECIEVABLE BEING BILLS FOR COLLECTION AS PER CONTRA

1,35,000.00 6,31,986.00

7) FIXED ASSETS J 6,54,84,630.02 4,00,16,562.02

8) CAPITAL ASSET wORK IN PROGRESS 3,83,250.00 11,48,525.00

9) OTHER ASSETS K 9,12,08,791.30 6,89,85,210.27

9) BRANCH ADJUSTMENT ACCOUNT 33,432.76 2,75,436.57

10) INVESTMENT IN LIC (GRATUITY) 2,98,25,713.23 2,86,32,723.54

TOTAL 7,70,49,95,308.01 6,68,83,64,253.25





Sd/-Lal Hiranandani Shri Dinesh S. Harchandani Director MD-cum-CEO

Sd/-Statutory AuditorsFor IdentificationIn term of our report of even dateFor R.Devendra Kumar & Associates Concurrent AuditorsChartered Accoutants For Sunny Gopichand BhagiaFRN : 114207W Chartered Accoutants

Sd/-(Neeraj Golas) (Sunny G. Bhagia)Partner ProprietorM. No. 074392 M. No. 138716

20






Sd/- Sd/-Lal Hiranandani Shri Dinesh S. Harchandani Director MD-cum-CEO

Statutory AuditorsFor IdentificationIn term of our report of even dateFor R.Devendra Kumar & Associates Concurrent AuditorsChartered Accoutants For Sunny Gopichand BhagiaFRN : 114207W Chartered Accoutants

Sd/- Sd/-(Neeraj Golas) (Sunny G. Bhagia)Partner ProprietorM. No. 074392 M. No. 138716

Profit and Loss Account for the year ended 31st March, 2017Particulars Schedule Current Year

31.03.2017Amount (`)

Previous Year 31.03.2016 Amount (`)

I. INCOME :Interest earned L 61,01,88,637.83 65,86,82,028.56 Other Income M 11,78,93,014.36 5,41,95,743.23

TOTAL 72,80,81,652.19 71,28,77,771.79 II. EXPENDITURE

Interest expended N 42,51,67,703.56 44,87,06,780.81 Operating expenses O 16,63,57,151.03 15,02,91,576.67 Provisions and Contigencies P 6,99,51,132.00 4,54,57,313.00

TOTAL 66,14,75,986.59 64,44,55,670.48 III. PROFIT/LOSS

Net Profit/ (Loss) for the year 6,66,05,665.60 6,84,22,101.31 Profit/(Loss) brought forward 18,73,011.99 11,74,902.40

TOTAL 6,84,78,677.59 6,95,97,003.71 IV. APPROPRIATIONS

Transfer to Statutory Reserve 2,39,67,000.00 2,45,00,000.00 Transfer to Other Reserve 2,94,12,000.00 2,90,50,000.00 Transfer to Proposed Dividend 1,46,52,021.45 1,41,73,991.72 Balance carried over to Balance Sheet 4,47,656.14 18,73,011.99

TOTAL 6,84,78,677.59 6,95,97,003.71

21


SCHEDULESParticulars Current Year

31.03.2017 Previous Year

31.03.2016 SCHEDULE A - CAPITAL

I) Authorised Capital 12,00,00,000.00 12,00,00,000.00

48,00,000 Shares of `25/- each

II) Issued Subscribed & Paid up Capital4235238 (3907199) shares of `25/- each fully paid 10,58,80,950.00 9,76,79,975.00

SCHEDULE B - RESERVE FUND & OTHER RESERVES:i) Statutory Reserve 20,24,50,503.90 17,79,50,503.90

ii) General Reserve 9,02,50,859.66 8,46,95,870.91

iii) Investment Fluctuation Fund 7,32,60,000.00 6,62,60,000.00

iv) Dividend Equalisation Fund 60,00,000.00

v) Development Fund 50,00,000.00 50,00,000.00

vi) Investment Depreciation Fund 4,43,91,900.00 7,94,41,650.00

vii) Buliding Fund 6,98,76,472.92 6,63,76,472.92

viii) Ceremonial Fund 0.00 34,34,168.00

ix) Contingent Reserve 75,00,000.00 75,00,000.00

x) Staff Welfare and Charitable fund 90,73,049.00 71,64,856.00

xi) Provision for Standard Assets 1,73,57,000.00 1,51,75,000.00

xii) Reserve for Bad and Doubtful Debts 15,46,57,042.89 11,96,57,042.89

xiii) Education Fund 90,00,000.00 55,00,000.00

xiv) Technological Development Fund 1,40,00,000.00 70,00,000.00

xv) Member Welfare Fund 10,00,000.00 -

TOTAL 69,78,16,828.37 65,11,55,564.62

SCHEDULE C - DEPOSITS & OTHER ACCOUNTS :I Current Deposits 37,40,82,821.09 30,13,03,435.15

II Saving Bank Deposits 1,76,14,43,254.01 1,29,79,68,765.34

III Term Depositsi) Fixed Deposits 1,12,37,31,682.75 1,03,49,02,054.50

ii) Reinvestment Deposits 2,97,01,80,930.45 2,70,51,63,785.39

iii) Recurring Deposits 11,77,96,757.88 12,70,52,568.88

iv) Bachat Yojana Deposits 6,85,87,839.00 7,42,58,973.00

v) Security Deposits 26,15,996.49 24,59,044.49

vi) Term deposit Adjustment A/c 7,873.00 -

4,28,29,21,079.57 3,94,38,36,426.26 IV Matured Deposits 2,62,88,392.25 9,72,59,463.00

TOTAL DEPOSITS (I+II+III+IV) 6,44,47,35,546.92 5,64,03,68,089.75

22




31.03.2016

SCHEDULE D - OTHER LIABILITIES & PROVISIONS :

A) OTHER LIABILITIES:

i) Pay order issued 6,35,51,004.33 88,03,071.15

ii) Unclaimed Dividend 22,62,717.62 17,65,885.99

iii) Sundry Creditors 40,93,466.96 35,15,853.03

iv) Clearing Account Payable 1,39,643.37 2,00,310.27

v) Bills Suspense Account - 34,409.00

vi) TDS Payable 24,21,092.54 25,32,585.00

vii) Stale Payorders & DDs 20,30,970.08 17,54,105.00

viii) Advance Commission Received 2,99,835.00 96,101.00

ix) SRO Charges 5,29,311.00 17,33,478.00

x) Loan Suspense 1,02,71,765.00 -

xi) Unclaimed Deposits 6,18,893.47 6,18,893.47

xii) NFS (ATM Settlement A/c.) 1.40 -

xiii) NFS Suspense Payable A/c. 1,65,200.00 1,64,200.00

xiv) Service Tax Payable 3,06,854.36 4,19,102.80

xv) Swatch Bharat cess 10230.11 15773.74

xvi) Krishi Kalyan cess 10263.55 -

xvii) Centralized pooling account 16500 -

xviii) Staff insurance premium account 11907.72 -

TOTAL (A) 8,67,39,656.51 2,16,53,768.45

B) OTHER PROVISIONS :

i) Provision for Ex- Gratia 1,00,00,000.00 1,00,00,000.00

ii) Provision for Taxation 6,66,22,881.00 3,30,00,000.00

iii) Provision for Revised Salary arrears 1,36,00,000.00 1,15,00,000.00

iv) Provision for Election Expenses 1,34,000.00 84,000.00

TOTAL (B) 9,03,56,881.00 5,45,84,000.00

TOTAL (A+B) 17,70,96,537.51 7,62,37,768.45

SCHEDULE E - PROFIT & LOSS :

Refer to Profit & Loss Appropriation Account

23




31.03.2016 SCHEDULE F- BALANCES wITH OTHER BANKS :

A CURRENT ACCOUNT

i) State Bank of India 5,59,218.00 35,44,070.00

ii) Maharashatra State Co op. Bank Ltd. 13,70,07,056.30 17,43,27,721.87

iii) Bank of Baroda 57,20,374.30 4,77,017.30

iv) IDBI Bank Ltd. 8,39,19,489.63 3,59,18,741.40

v) ICICI Bank Ltd. 6,74,89,960.40 5,32,37,197.36

vi) Axis Bank Ltd. 3,47,18,417.86 1,73,13,243.11

vii) HDFC Bank Ltd. 22,01,714.56 5,02,354.02

viii) IndusInd Bank 2,27,20,077.47 57,14,036.00

ix) Saraswat Co op. Bank Ltd. 8,21,762.51 13,49,255.01

x) Kalyan Janta Sahkari Bank Ltd. 1,77,640.52 11,61,413.42

xi) Yes Bank 3409900.00 45,24,500.00

xii) Dombivli Nagrik Sahkari Bank Ltd. 2000.00 -

TOTAL 35,87,47,611.55 29,80,69,549.49

B FIXED DEPOSITS

i) Maharashatra State Co op. Bank Ltd. 4,25,00,000.00 4,25,00,000.00

ii) State Bank of India 1,00,00,000.00 1,00,00,000.00

iii) Bank of Baroda 4,28,86,752.00 4,58,06,128.00

iv) NKGSB Co-op. Bank Ltd. 2,00,00,000.00 -

v) IDBI Bank 5,88,00,000.00 6,78,00,000.00

vi) Saraswat Co op. Bank Ltd. 6,25,00,000.00 12,49,00,000.00

vii) Shamrao Vithal Co op. Bank Ltd 1,00,00,000.00 7,00,00,000.00

viii) TJSB Sahakari Bank Ltd. 50,00,000.00 9,50,00,000.00

ix) Punjab & Maharashtra Co op. Bank Ltd. 3,00,00,000.00 5,00,00,000.00

x) Kalyan Janata Sahkari Bank Ltd. 1,10,44,088.00 7,00,00,000.00

xi) Indusind Bank Ltd 2,09,14,986.00

xii) Dombivli Nagrik Sahkari Bank Ltd. 3,00,00,000.00 2,00,00,000.00

xiii) Bandhan Bank 20,00,000.00 20,00,000.00

xiv) Ratnakar Bank 99,00,000.00 1,98,00,000.00

TOTAL 33,46,30,840.00 63,87,21,114.00

TOTAL (A+B) 69,33,78,451.55 93,67,90,663.49

24




31.03.2016 SCHEDULE G- INVESTMENTS:

i) In Central Government Securities 1,27,76,40,900.00 1,32,38,48,376.00 Face Value : `1254800000/-Market Value : `1199965400/-

ii) In State Government Securities 41,79,18,441.00 19,47,08,978.00 Face Value : `404140000/-Market Value : `422246696/-(Earmarked for Reserve fund `2050.00 lacs )

iii) Share of MSC Bank Ltd. of `1000/- fully paid. 1,000.00 1,000.00iv) L&T Finance Holding Ltd (Preference Shares) 3,00,00,000.00 3,00,00,000.00

Face Value : `30000000/-Market Value : `30000000/-

v) Infrastructure Leasing & Financial Services Ltd (Pref. shares) 3,00,00,000.00 - Face Value : `15000000/-Market Value : `31015160/-Note: `15000000/- is redeemable premium

vi) Tata Capital Ltd (Preference shares) 3,00,00,000.00 - Face Value : `30000000/-Market Value : `30000000/-

vii) PSU Bonds 49,74,22,890.50 11,67,52,000.00Face Value : `448277000/-Market Value : `475416876/-

viii) Mutual funds,etc., 5,99,08,352.00 13,00,00,000.00 Market Value : `65384836/-

ix) Other Investments (NBFC FDR) - 3,00,00,000.00 TOTAL 2,34,28,91,583.50 1,82,53,10,354.00

SCHEDULE H - LOANS AND ADVANCES:I Cash Credits of which Overdue 61,05,48,063.56 64,84,48,361.31

Overdues 8,25,05,894.91 11,16,87,797.67% of Overdues 13.51% 17.22%

II Overdrafts of which Overdue 1,97,70,36,448.48 1,56,19,96,722.58Overdues 8,05,43,992.13 6,68,13,887.17% of Overdues 4.07% 4.28%

III Term Loans of which Overdue 1,60,74,78,124.73 1,36,38,48,817.94Overdues 9,16,01,936.51 10,26,94,082.20% of Overdues 5.70% 7.53%

IV Bills Discounted & Purchased 0.00 0.00TOTAL OUTSTANDING 4,19,50,62,636.77 3,57,42,93,901.83 TOTAL OVERDUES 25,46,51,823.55 28,11,95,767.04 % OF OVERDUES 6.07% 7.87%

SCHEDULE I - INTEREST RECIEVABLE:i) Investments 6,54,60,883.21 7,76,63,126.24ii) Overdue Interest on NPA (Loans) 14,90,49,658.92 9,90,99,095.34

TOTAL 21,45,10,542.13 17,67,62,221.58

25


CO

NS

OLI

DA

TED

SC

HE

DU

LE O

F FI

XE

D A

SS

ETS

:-

SC

HE

DU

LE J

:-

SR.

NO.

ASSE

T DES

CRIPT

ION

GROS

S BLO

CKDE

PREC

IATIO

N/AM

ORTIS

ATIO

NNE

T BLO

CK

Open

ing

Balan

ce *

Addit

ions

Sale/

Trans

fer/

Write

Off/

Othe

r Ad

justm

ents

Clos

ing

Balan

ceOp

ening

Ba

lance

For t

he

year

ende

d 31

.03.20

17

Sale/

Trans

fer/

Write

Off/

Othe

r Ad

justm

ents

Clos

ing

Balan

cewD

V as o

n 31

.03.20

17wD

V as o

n 31

.03.20

16Co

st as

on

01.04

.2016

Befor

e 01

.10.20

16On

or Af

ter

01.10

.2016

Cost

as on

31

.03.20

17As

on

01.04

.2016

As on

31

.03.20

17

1CB

S 23

,907,9

34.26

38

6,841

.00

276,5

00.00

15

,417.0

0 24

,555,8

58.26

21

,305,2

64.26

1,

293,2

13.00

-

22,59

8,477

.26

1,95

7,380

.99

2,60

2,669

.99

2VE

HICL

ES 4,

332,3

37.00

-

- -

4,33

2,337

.00

2,27

6,420

.00

308,3

88.00

-

2,58

4,808

.00

1,74

7,529

.00

2,05

5,917

.00

3BA

NK PR

EMIS

ES 4,

067,2

19.70

-

19

,200,0

00.00

-

23,26

7,219

.70

2,12

1,882

.00

1,15

4,534

.00

- 3,

276,4

16.00

19

,990,8

03.70

1,

945,3

37.70

4OT

HER

FIXED

ASS

ETS

63,15

8,914

.88

13,41

9,311

.00

2,04

1,547

.00

1,34

2,721

.00

77,27

7,051

.88

29,74

6,277

.56

5,74

1,856

.00

- 35

,488,1

33.56

41

,788,9

16.32

33

,412,6

37.32

TOTA

L95

,466,4

05.83

13

,806,1

52.00

21

,518,0

47.00

1,

358,1

38.00

12

9,432

,466.8

3 55

,449,8

43.82

8,

497,9

91.00

-

63,94

7,834

.82

65,48

4,630

.01

40,01

6,562

.02

Open

ing B

alanc

e in t

he G

ross b

lock i

nclud

e adju

sted W

DV in

case

of as

sets

acqu

ired p

rior to

01.04

.2009

;

In ca

se of

vehic

les, a

sset

regist

er ve

hicle-

wise

is be

ing up

dated

, profi

t /los

s on s

ale is

arriv

ed at

base

d on a

vaila

ble in

forma

tion,

loss o

n sale

of ve

hicles

relat

ing to

earlie

r yea

r is ac

coun

ted du

ring t

he ye

ar. C

arried

balan

ce of

gros

s bloc

k and

de

precia

tion i

s to b

e rec

oncil

ed.

The p

rofit/L

oss o

n sale

of as

sets

durin

g the

year

is to

be re

conc

iled w

ith th

e Bran

ch/as

set w

ise re

cords

and r

esult

ants

adjus

tmen

ts wi

ll be c

arried

out.;

In ca

se of

asse

ts rel

ating

to ol

d CBS

retire

d duri

ng th

e yea

r, dep

reciat

ion fo

r first

half o

f the y

ear h

as be

en ch

arged

.

26




31.03.2016

SCHEDULE K- OTHER ASSETS:

i) Telephone and other Deposit 64,26,203.51 64,21,768.50

ii) Stamped Documents in hand 7,960.00 5,900.00

iii) Sundry Debtors 13,68,341.00 69,71,655.00

iv) Clearing Account receivable 4,87,115.26 6,18,036.80

v) Stock of Stationery 4,77,690.25 3,07,562.25

vi) TDS (AY 2016 - 17) 11,79,738.00 72,259.00

vii) TDS (AY 2017 - 18) 2,94,582.00 -

viii) Advance Tax Paid (AY 2016 - 17) 4,00,00,000.00 4,00,00,000.00

ix) Advance Tax Paid (AY 2017 - 18) 3,05,00,000.00 -

x) Service Tax Recievable 22,59,574.01 16,90,161.32

xi) Krishi Kalyan Cess Receivable 10,110.61 -

xii) ST CENVAT deferrred account 46,528.00 -

xiii) KKC CENVAT deferrred account 78.50 -

xiv) Franking Stamps 24,92,072.00 38,49,691.00

xv) Prepaid Expenditure 11,89,649.00 13,77,841.00

xvi) PAN Card Coupons 14,312.00 9,889.00

xvii) Investment Premium Account 38,35,991.00 59,10,762.00

xviii) Advance CERSAI charges 13,447.25 0.00

xix) Settlement of Claims (DEAF Scheme, 2014) 27,941.91 36,101.40

xx) Net of I.T. Provision (AY 2013-14) - 6,95,876.00

xxi) Net of I.T. Provision (AY 2014-15) 5,77,457.00 5,77,457.00

xxii) ATM unreconciled entries. - 39,000.00

xxiii) NFS RUPAY ATM cum Debit card - 4,01,250.00

TOTAL 9,12,08,791.30 6,89,85,210.27

SCHEDULE L - INTEREST EARNED :

i) Interest received on Advances 40,87,70,894.96 44,37,98,010.54

ii) Interest received on Investments 20,07,69,121.69 21,36,12,382.23

iii) Other Interest Income 6,48,621.18 12,71,635.79

TOTAL 61,01,88,637.83 65,86,82,028.56

27




31.03.2016 SCHEDULE M- OTHER INCOME:

i) Commission and Exchange 4,35,850.57 16,71,156.83

ii) Rent on Lockers 26,28,987.67 25,56,954.00

iii) Commission on General Insurance Business 25,073.00 2,03,827.00

iv) Income from Franking Stamps 20,10,462.25 23,42,970.00

v) Income from sale of GOI 6,31,65,178.00 1,60,54,650.00

vi) Income from Mutual Funds 1,98,48,010.06 45,38,715.61

vii) Income from sale of Bonds 48,36,984.00 -

viii) Dividend from CRPS 26,42,852.44 -

ix) Miscellaneous Income 2,22,98,222.37 2,68,27,469.79

x) I.T. refund for F.Y. 2013-14 1,394.00 -

TOTAL 11,78,93,014.36 5,41,95,743.23

SCHEDULE N- INTEREST EXPENDED :

i) Interest paid on Deposits, Borrowings etc 42,51,67,703.56 44,87,06,780.81

TOTAL 42,51,67,703.56 44,87,06,780.81

SCHEDULE O- OPERATING EXPENSES :

i) Salaries and Allowances 6,72,97,805.50 6,36,75,984.00

ii) Directors’ Fee 1,58,860.00 1,66,850.00

iii) Rent ,Lighting,Insurance,Taxes, etc., : 4,69,77,233.96 5,10,61,501.90

iv) Law Charges - 40,000.00

v) Postage,Telegrams and Stamps : 27,60,970.27 20,55,948.31

vi) Auditors’ Fees 20,05,146.00 19,12,120.00

vii) Depreciation 84,97,989.00 67,90,695.47

viii) Repairs & Maintenance 20,63,483.51 31,69,840.15

ix) Printing and Stationary 24,51,500.56 22,75,023.27

x) Advertisement 31,76,235.00 12,88,851.00

xi) Bank Charges 3,268.80 8,210.19

xii) Conveyance 8,89,135.00 7,81,656.00

xiii) Subscription 1,96,077.00 243464.00

xiv) Miscellaneous Expenditure 1,01,82,036.24 60,98,440.11

xv) Entertainment Expenses 7,00,288.00 7,32,315.00

xvi) Commission paid on Bachat Yojana Scheme 49,24,533.00 50,21,380.00

xvii) Staff Training 1,30,605.00 2,12,780.00

28




31.03.2016 xviii) Vehicle Maintenence Expenses 10,69,947.50 6,71,539.00

xix) Professional fees 30,94,557.75 17,97,382.00

xx) Amortisation of premium account 20,74,771.00 6,68,039.00

xxi) Loss on sale of Asset 8,48,494.50 13,71,673.00

xxii) ATM Transaction Chgs.(Issuer) - 2,47,884.27

xxiii) Lease line connectivity charges 15,32,680.00 -

xxiv) Application service providing charges 33,29,675.00 -

xxv) Loss on sale of securities 19,91,848.44 -

xxvi) I.T. demand for A.Y. 2015-16 10.00 -

TOTAL 16,63,57,151.03 15,02,91,576.67

SCHEDULE P - PROVISIONS AND CONTIGENCIES :

i) Provision for Deferred Tax Liability 4,14,419.00 (19,187.00)

ii) Provision for Ex-gratia 1,00,00,000.00 1,00,00,000.00

iii) Provision for Salary Arrears to Staff 21,00,000.00 70,00,000.00

iv) Provision for Bad Debts 3,50,00,000.00 2,00,00,000.00

v) Provision for Contg. Against Standard Assets 21,82,000.00 5,00,000.00

vi) Provision for Depreciation on Investments 3,10,66,000.00 19,76,500.00

vii) Provision for Income Tax 3,36,22,881.00 3,30,00,000.00

viii) Provision & Contingencies (4,44,34,168.00) (2,70,00,000.00)

TOTAL 6,99,51,132.00 4,54,57,313.00

29


GROUPINGS TO SCHEDULESParticulars Current Year


31.03.2016

MISCELLANEOUS INCOME :-

ATM Transaction Chgs.(Acquirer) - 95,905.00

Incidental Charges 2,536,624.30 2,885,440.31

Misc. Income / Min. Bal. Chgs./other chgs. 2,130,529.13 2,459,076.98

Cheque Book charges 950,456.50 607,635.88

Processing charges 12,626,085.13 12,739,095.09

Cheque Return Charges 1,972,000.93 3,047,262.43

Write off Income 76,310.25 36,326.50

Profit on Sale of Asset 71,642.00 2,087,197.00

Commission on PAN Cards 2,232.00 2,285.00

Loan Prepayment Chgs. 556,912.53 377,447.22

EMT Service Chgs 501,187.00 244,000.00

Other Mortgage Chgs. 159,500.00 76,040.00

Excess Provision for Ex- gratia - 148,336.00

Excess I.T. Provision reversed (AY 2012-13) - 801910.00

Commitment chgs.(Advances) 684,958.21 1,218,914.38

Commission on Pradhan Mantri Suraksha Bhima Yojana 625.00 598.00

Other charges 4,000.00 -

Online tax payment service charges 1,155.39 -

Law charges 24,004.00 -

TOTAL 22,298,222.37 26,827,469.79

MISCELLANEOUS EXPENDITURE :-

Miscellanous Expenditure 1,298,377.59 2,983,422.95

AGM Expenses 1,013,135.00 209,402.00

Diwali Expenses 176,358.00 521,116.00

Administration Exps. 435,959.00 411,828.00

MSC Processing charges 422,398.62 150,670.56

MSC Cheque Return Charges 689,488.88 756,677.60

Payment of Income Tax (AY 2014-15) 256,863.00 -

Cash Remittance charges 2,568,487.00 101,100.00

30


GROUPINGS TO SCHEDULESParticulars Current Year


31.03.2016

Short recovery charges 12,448.37 -

NFS ATM Service Chgs - 545,700.00

Prior Payment Exp.-NFS 2015-16 7,950.00 372,824.00

Promotional Exps. 260,302.00 45,699.00

ATM Card expenses 545,375.00 -

UCIC Generation charges 320,664.00 -

Interest on taxes 427.00 -

NPCI certification fees 401,250.00 -

ATM Transaction Chgs 238,262.00 -

Website development charges 36,635.00 -

Sweeping charges 84,000.00 -

Outsourced security guard expenses 933,865.37 -

Central Registry charges 34,248.41 -

E-mail server hosting charges 38,790.00 -

Annual day function expenses 165,258.00 -

Demonitization expenses 241,494.00 -

TOTAL 10,182,036.24 6,098,440.11

TRANSFER TO OTHER RESERVES :-

Investment Fluctuation Fund 20,884,000.00 7,000,000.00

Building Fund 1,000,000.00 3,500,000.00

General Reserve fund 1,000,000.00 5,000,000.00

Staff Welfare & Chariatable fund 500,000.00 2,000,000.00

Members’ Welfare Fund 500,000.00 1,000,000.00

Education Fund 3,424,000.00 3,500,000.00

Technological Development Fund 2,054,000.00 7,000,000.00

Election Exps 50,000.00 50,000.00

TOTAL 29,412,000.00 29,050,000.00

31


SCHEDULESAppropriations subject to AGM approval

11) Profit & Loss Appropriation Account:

Particulars Current Year 31.03.2017

Previous Year 31.03.2016

Balance of Profit 1,873,011.99 1,174,902.40

Add: Profit for the current year as per Profit & Loss Account 66,605,665.60 68,422,101.31

68,478,677.59 69,597,003.71

less: Appropriations

i) Statutory Reserve 23,967,000.00 24,500,000.00

ii) Dividend 14,652,021.45 14,173,991.72

iii) Investment Fluctuation Fund 20,884,000.00 7,000,000.00

iv) Building Fund 1,000,000.00 3,500,000.00

v) General Reserve fund 1,000,000.00 5,000,000.00

vi)Staff Welfare & Chariatable fund 500,000.00 2,000,000.00

v)Members’ Welfare Fund 500,000.00 1,000,000.00

vii)Education Fund 3,424,000.00 3,500,000.00

viii)Technological Development Fund 2,054,000.00 7,000,000.00

ix) Election Exps 50,000.00 50,000.00

68,031,021.45 67,723,991.72

Balance carried over. 447,656.14 1,873,011.99

32


NOTES FORMING PART OF ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2017SCHEDULE Q

SIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PART OF ACCOUNTS AND DISCLOSURES FOR THE YEAR ENDED 31ST MARCH, 2017

A) SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO FINANCIAL STATEMENTS:

1. Basis of Preparation:

a) The accompanying financial statements have been prepared under the historical cost convention and they conform to Generally Accepted Accounting Principles (GAAP) in India, which comprise the statutory provisions prescribed under the Banking Regulation Act, 1949, guidelines of Reserve Bank of India (RBI), the Accounting Standards and guidance notes issued by the Institute of Chartered Accountants of India (ICAI) and the practices prevalent in the banking industry in India.

b) The financial statements are drawn up in accordance with the historical cost convention and on Going Concern basis.

2. Use of Estimates:

The preparation of the Financial Statements, in conformity with generally accepted accounting principles, requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and disclosures of contingent liabilities at the date of the financial statements. Actual results could differ from those estimates. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Any revision to the accounting estimates are recognized prospectively.

3. Investments:

a) In accordance with the RBI directives, the Bank has classified its Investment portfolio as on 31st March, 2017 in the following 3 categories:

i) HELD TO MATURITY (HTM)

ii) HELD FOR TRADING (HFT)

iii) AVAILABLE FOR SALE (AFS)

b) Further, in compliance with the said directives, the valuation of Investments in these categories has been done as follows:

i) HELD TO MATURITY:Investments under this class are carried at their acquisition cost. Any premium on acquisition of a security is amortized over the balance period to maturity with a debit to Profit and Loss Account.

During the year amortization of premium on HTM securities was short to the extent of `3,59,428/- due to system generated reports. The Bank is taking adequate steps to compile the year-wise amortization of premium at the time of such categorization of individual scrip. The shortfall stated as above is to be adjusted in subsequent years.

ii) HELD FOR TRADING: Investments under this class are marked to market rate scrip wise on the basis of guidelines issued by Reserve Bank of India and net depreciation in each category is recognized in the Profit and Loss Account. Net appreciation in each category, if any, is ignored.

33


iii) AVAILABLE FOR SALE: Investments under this class are valued at marked to market rate scrip wise on the basis on guidelines issued by Reserve Bank of India and net depreciation in each category, if any, is provided for. Net appreciation in each category, if any, is ignored.

iv) Securities sold/purchased under repo transaction during the year:

The Bank does not undertake any sale or purchase of securities under REPO transactions.

c) Fixed deposits to the extent of `392 lakhs have been pledged with IDBI Bank for OD limits of `352.80 lakhs sanctioned to the Bank. Fixed deposits to the extent of `100 lakhs have been pledged with State Bank of India for OD limits of `75 lakhs sanctioned to the Bank. Further, Fixed Deposits to the extent of `400 lakhs have been pledged with MSC Bank Ltd for OD limits of `320 lakhs to ensure smooth clearing settlements.

d) The balance in investment depreciation fund as on 31/03/2017 has been in excess of the requirements as prescribed under RBI guidelines. In accordance with the said guidelines, during the year, an amount of `350.00 lakhs has been transferred from Investment depreciation fund to Profit & Loss Account under the head “Provisions and Contingencies”. The said guidelines also require equivalent amount to be appropriated to Investment Fluctuation Fund (IFR) but since in the opinion the compliance of minimum balance in IFR has been ensured as per prescribed RBI Guidelines, such appropriation has not been recommended.

4. Provisioning of Advances & Overdue Interest Reserve

a) Advances are classified under four categories i.e. (i) Standard Assets, (ii) Sub – Standard Assets, (iii) Doubtful Assets and (iv) Loss Assets in accordance with the guidelines issued by the RBI from time to time.

b) Provision on advances categorized under Sub – Standard, Doubtful and Loss Assets is made in accordance with the guidelines issued by the RBI. In addition, a general provision has been made on all standard assets as per RBI directives.

Category Provision (%)Direct Advances to agricultural and SME Sectors 0.25%

Commercial and Real Estate Loans 1.00%

Other Standard Advances 0.40%

c) The Overdue Interestin respect of NPA Advances is provided separately under ‘Overdue Interest Reserve’as per the directives issued by the Reserve Bank ofIndia.

5. Fixed Assets and Depreciation:

a) Fixed Assets (except for Computers) are depreciated at the rates specified as per the Income Tax Act and as per directives issued by the Bank & RBI on written down value method. Computers are depreciated following Straight Line Method at the rate of 33.33 percent per annum.

b) No Depreciation is provided on assets sold during the year.

c) On fixed assets put to use on or before 30th September of the financial year, depreciation is provided for full year. On fixed assets put to use on or after 1st October of the financial year, depreciation is provided for half year.

34


d) Owned Premises include Land and Building situated at Ulhasnagar – 1, Ulhasnagar – 5 and Thane Branch only. All other Branches, Godown and Head – Office are on rental basis.

6. Reserves and Other Funds:

a) As per the requirements of the Maharashtra State Co- Operative Societies Act 1960, Net Profit after Tax is appropriated towards: Reserve Fund (Comprising 25% of Net Profit plus additional 10% of Net Profit, subject to availability) and as provided in the bye laws.

b) Dividend remaining unclaimed over 3 years, Entrance Fee and Nominal Membership Fees outstanding at the year-end are transferred to Reserve Fund. During the year, a sum of ̀ 4,54,588.75 being unpaid dividend for the period older than 3 years have been transferred to General Reserve.

c) During the year an amount from Dividend Equalisation Fund amounting to ̀ 60,00,000.00 and Ceremonial Fund amounting to `34,34,168.00 aggregating to `94,34,168.00 has been transferred to General Reserve as these reserves were no longer considered necessary. The same balance of `94,34,168.00 has been taken to the credit of Profit & Loss Account under “Provisions and Contingencies”.

7. COMPLIANCES OF ACCOUNTING STANDARDS:

7.1. Revenue Recognition(AS-9):

a) Items of Income and Expenditure are generally accounted for on accrual basis except otherwise stated.

b) Income from Non – Performing Asset is recognized to the extent realized, as per directives issued by the Reserve Bank of India.

c) Rent on Safe Deposit lockers is accounted for on cash basis.

d) As per Master Circular Directives from RBI on Investments, income on units of Mutual funds (Debt funds); Income is booked on Cash basis and not on accrual basis. During the year such income of `1.34 lakhs is accounted on accrual basis.

7.2. Employee Benefits (AS-15):

a) The liability towards gratuity is assessed on actuarial valuation done by LIC. Bank has covered gratuity under Group Gratuity Scheme in association with LIC of India. (Premium of which has been paid for the period up to 31.03.2017). At present, policy covers 193(Previous Year 201) employees of the Bank and an amount of `2,98,25,713.23(Previous Year `2,86,32,723.54) has been provided in the Balance Sheet.However the balance of the fund as stated above is updated in the books of accounts post Balance Sheet date on receipt of statement from LIC.

b) The Bank has decided to account for leave encashment payable to employees on cash basis as the Bank is confident of meeting the said liability as and when the same arises. The accounting of leave encashment is not in strict accordance with the Accounting Standard 15 issued by Institute of chartered Accountants of India. Since amount payable is not quantified, the effect of the same on the profitability of the Bank cannot be arrived at. However, in the opinion of the management, amount if arrived at is not expected to be material.

c) Bank’s contribution to Provident Fund is accounted for on the basis of contribution to the Scheme.

35


7.3. Segment Reporting (AS- 17):

In accordance with Accounting Standard 17 on “Segment Reporting” issued by the Institute of Chartered Accountants of India, the bank’s business has been segregated into the following segments:

i) Retail Banking

ii) Other Banking Business as under:-

The disclosures of segment assets and segment liabilities, segment income and expense and other necessary disclosures as required under the Accounting standard is not compiled however aggregate loans outstanding under the each segment in different sectors are as under:

(` in Lakhs)

PRIORITY SECTOR: OUTSTANDING

i) Retail Trade 1273.12

ii) Small Business 2215.35

iii) Small Scale Industries 6137.50

iv) Construction and/or repairs to building, etc. incl.Housing up to `25 Lakhs 2737.52

v) Agricultural & Allied Activities 23.01

vi) Small Road Transport operators. 19.86

vii) Professional & Self employed artisans and craftsmen 230.59

viii) Education 468.12

ix) Other Priority Sectors 455.47

TOTAL PRIORITY SECTOR 13560.54

NON- PRIORITY SECTOR:

i) Medium and Large Industries NIL

ii) Export Trade NIL

iii) Banks NIL

iv) Non Banking Financial Institution NIL

v) Government (Central/States) NIL

vi) Food Credit (FCI consortium) NIL

vii) Real Estate 5506.40

viii) Other PSUs NIL

Ix) All Others 22883.69

TOTAL NON-PRIORITY SECTOR 28390.09

Total Advances 41950.63

Since the new CBS software is being customized to provide the reports relating to sectorial classification of advances, the above data has been compiled based on the information available at Head Office and is to be reconciled with the data received from Branches as at present the system does not provide for such reports.

36


7.4. Related Party Disclosure (AS- 18):

As per the Accounting Standard 18 issued by The Institute of Chartered Accountants of India, following are the details of related parties requiring disclosure:

The premises of H.O., Main Branch, Siru Chowk and O.T. Section and Godown are taken on lease from the Directors of the Bank and their Relatives/Associates. Details of Total amount of Rent and Service/Amenities charges for the said premises and other amounts paid during the Financial Year 2016-17 are as under:

Sr. No. Branch Name of Director / Lessor Nature of

Transaction(Amount

in (`)

1. Main Br. & Head Office

Shri. Sitaldas Harchandani (Chairman) & family members

Rent for Premises and Service Amenities 128,91,243/-

2. Godown Ms. Upasana J Watwani –(Relative of Director)

Rent for Premises and Service Amenities 8,19,420/-

3. Siru Chowk

1) Smt. Indira S. Harchandani (Relative of Chairman)

2) Ms. Deepa Harchandani (Relative of Chairman)

3) Smt. Harshita Harchandani (Relative of Chairman)

Rent for Premises and Service Amenities

29,17,440/-

4. O.T. Sec.

Sai Baba Education Trust – Non Profit Organization (Majority Management Controlwith Chairman/Director(s) of the Bank)

Rent for Premises and Service Amenities 909,360/-

The information as above is as provided by the management based on data received from Branches/ compiled at Head Office. The Bank is in the process of developing information system so that the data in relation to related party transaction is captured at inception and report is available in the system.

7.5. Leases:

Except for Ulhasnagar-1 and Thane Branches (both partly), The Bank has taken Branch and Head Office premises in operating leases. Further disclosures as required under AS-19 are not considered material.

7.6. Earnings Per Share:

Particulars 2016-2017(Amount in `)

2015-2016(Amount in `)

Profit Attributable to Shareholders 66605665 68422101

No. of Shares (Number) 4235238 3907199

Earnings Per Share (EPS) 15.73 17.51

Diluted Earnings Per Share (DEPS) 15.73 17.51

No. of Shares considered for calculation of EPS is as the end of the year.

7.7. Income Tax (AS-22)

Provision for Taxes is made on the basis of taxable profits computed as per provisions of the Income Tax Act, 1961.

37


Deferred Tax is recognized, subject to consideration of prudence, on timing difference between taxable income and accounting income that originated in one period and is capable of reversal in one or more subsequent periods. Deferred Tax Liabilities are measured using tax rates and tax laws that have been enacted or substantially enacted by the Balance Sheet date.

The Deferred tax Liabilities as at March, 2017 is arrived at to the extent of available information/estimates of the management in respect of timing differences pending compilation of WDV for computers as per the tax provisions, as follows:

Particulars (Amount in `)Depreciation on Computers:Opening Balance 3,33,986.36

Provision during the year 4,14,419.00

Balance as on 31.03.17 7,48,405.36

Year-wise tax receivable is to be reconciled with tax records, the Bank has carried an amount of ̀ 5.77 lakhs as tax refundable pending assessment though the refund claimed in the return in NIL.

7.8. Impairment of Assets (AS-26)

The Bank has ascertained that there is no material impairment of any of its assets and as such no provision on account of impairment of assets is required to be made however there is no formal documented report for such assessment in terms of the requirements of AS-26.

7.9. Provisions, Contingent Liability &Contingent Assets (AS-29):

a) In conformity with Accounting Standard 29, the Bank recognizes provisions only when it has a present obligation as a result of a past event, it is probable that an out flow of resources embodying economic benefits will be required to settle the obligations, and when a reliable estimate of the amount of the obligation can be made.

b) No provision is recognized for.

Any possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non – occurrence of one or more uncertain future events not wholly within the control of the Bank; or

i) Any present obligation that arises from past events but is not recognized because:

a) It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

b) A reliable estimate of the amount of obligation cannot be made.Such obligations are recorded as Contingent Liabilities. These are assessed at regular intervals and only that part of the obligation for which an outflow of resources embodying economic benefits is probable, is provided for, except in the extremely rare circumstances where no reliable estimate can be made.

c) Contingent Assets are not recognized in the financial statements.

d) Contingent liability on account of Bank’s constituents is `245.22 Lakhs (previous year – `411.13Lakhs): represents Guarantees issued on behalf of customers.

38


e) Working Funds of the Bank are `75259.84 Lakhs (Previous Year `65600.00 Lakhs) which includes Fixed Assets & Other Assets.

8. Other Notes:

a) There has been no fine/penalty imposed upon the Bank by RBI during the year. The Bank has taken steps to ensure compliance of majority of matters raised by RBI in the latest Inspection report.

b) As per the certificates issued by the branches all Deposit/Advances books (General Ledger with subsidiaries) are balanced as at31st March, 2017 and are tallied. However certain accounts at Head office and at Branches representing assets, liabilities, income and expenditure which include old balances are subject to confirmation, reconciliation and resultant accounting adjustments. Net Balance in Inter Branch account `0.33 lakhs is also being reconciled with reference to outstanding debit and credit entries. The effect on the accounts though not ascertained, in the opinion of the management is not considered to be material.

c) The Bank had during the PreviousYear migrated to new CBS software”Fin-craft”. The management has taken sufficient care to ensure smooth and correct migration of data, however post migration there are certain modules of interest application for deposits and advances, generation of report of overdue loans, sectorial classification, facility wise classification etc., in advances which are yet to be stabilized and aberrations have been found in the reports/ interest application. Pending stabilization of interest application module, interest as applied by the present system has been accounted for in the financial statements, overdue loans, facility and security wise classification for the purpose of disclosures are as compiled in Branches. Necessary adjustments in this regard shall be carried out as and when new system stabilizes and effects are known. The migration audit of the process has also since been completed and management is taking steps to address various observations in the migration audit. In the opinion of the management the impact if any arising out of the above is not likely to be material.

d) The Management has set up the Central Processing Cell for Advances in view of strengthening system of credit appraisal including ascertaining credit worthiness and repayment capacity of the borrower.

e) The system of identification of Non-performing assets through system generated reports of overdues is also under comprehensive review and is also being further strengthened.During the year the Bank has obtained membership of CIBIL and CERSAI and necessary compliance is being ensured.

f) Bank is in the process of complying requirement of active/inactive member and minimum shareholdings as per amended bye laws.

g) Certain disclosures as required under “FORM A”& “FORM B” as set out in Third schedule to the Banking Regulation Act, 1949 as applicable to Cooperative Banks and “Form N” as specified under the Maharashtra Cooperative Societies Rules 1961, are pending and are as per the consistent practice followed by the Bank.

h) The management is in the process of strengthening the internal control systems with regard to various operational areas. The internal audit system is also under comprehensive review and is being strengthened.

i) During the year, the management has taken various steps including risk categorization of customers in order to achieve the Compliance of KYC/AML guidelines regarding risk categorization of customers, multiple customer ids; and other related guidelines issued by RBI. However there are certain cases where the same is not adequately reflected in the system generated reports and in some other cases certain compliances are being ensured. The management is taking steps to ensure the necessary compliance of the same.

39


9. Figures for the previous year are regrouped and/or rearranged, wherever necessary to confirm to the layout of the accounts of the Current Year.

B) Disclosure of Information as per RBI guidelines:

(ìn Lakhs)

Sr No Particulars 31.03.17 31.03.16i) Capital to Risk Asset Ratio 13.04% 15.61%

(As per Guidelines from RBI vide MC – July 2015).ii) MOVEMENT OF CRAR :

Tier I Capital 5348.39 4946.17Tier II Capital 732.60 662.60Total Capital 6080.99 5608.77Total Risk Weighted Assets 46622.96 35924.19Capital to Risk Asset Ratio 13.04% 15.61%

iii) INVESTMENTS: (Includes Govt. & otherTrust securities)Book Value of Investments 16955.59 15185.57Face Value of Investments 16589.40 15095.10Market Value of Investments 16222.12 14858.01

iv) Advances against real estate, Constn. Business and Housing 8243.92 8471.34v) Advances against Shares and debentures Nil Nilvi) Advances to Directors, Ex-Directors their relatives,

companies/firms in which they are interesteda) Fund Based 37.42 39.85b) Non Fund Based Nil Nil

vii) Average cost of deposits 7.10% 7.85%viii) NPAs

Gross NPA 2592.42 2681.25% OF Gross NPAs to Loans 6.18% 7.50%Net NPA 1045.85 1484.68% of Net NPAs 2.59% 4.30%

ix) Movement of NPAsOpening Balance 2681.25 2103.58Additions during the year 350.27 1411.55Total 3031.52 3515.13Less: Reduction during the year 439.10 833.87Gross NPA 2592.42 2681.25Net NPA 1045.85 1484.68

x) ProfitabilityInterest Income as a percentage of working funds 8.07% 9.83%Non – Interest Income as a percentage of working funds 2.25% 1.16%Operating Profit as a Percentage of working funds 1.98% 2.09%Return on Assets 0.96% 1.02%Business (Deposits + Advances) per employee 572.03 453.92Profit per employee 3.58 3.37

40


Sr No Particulars 31.03.17 31.03.16xi) Provision made towards :

a) NPA 350.00 200.00b) Standard Assets 21.82 5.00c) Depreciation in Investments 310.66 19.77

xii) Provisions towards:a) NPA 1546.57 1196.57b) Standard Assets 173.57 151.75c) Depreciation on Investments 443.92 794.42

xiii) Foreign Currency Assets & Liabilities N I L

xiv) Deposit Insurance and Credit Guarantee, Insurance Premium has been paid up to date.

xv) Penalty imposed by RBI N I L

xvi) Restructured Accounts

(As compiled by the management as no system generated report) (` in Lakhs)

Particulars of Restructured AccountsHousing

LoansSME Debt

RestructuringOthers

Standard Advances Restructured

No. of Borrowers 0 0 0

Amount Outstanding 0.00 0.00 0.00

Sacrifice (diminution in the fair value) 0.00 0.00 0.00

Sub - standard Advances Restructured

No. of Borrowers 0 0 0

Amount Outstanding 0.00 0.00 0.00Sacrifice (diminution in the fair value) 0.00 0.00 0.00

Doubtful Advances Restructured

No. of Borrowers 0 0 0Amount Outstanding 0.00 0.00 0.00Sacrifice (diminution in the fair value) 0.00 0.00 0.00

TOTALNo. of Borrowers 0 0 0

Amount Outstanding 0.00 0.00 0.00

Sacrifice (diminution in the fair value) 0.00 0.00 0.00

xvii) Fixed Assets – Valuation / Revaluation - N I L

xviii) Amounts transferred to The Depositor Education and Awareness Fund Scheme, 2014at RBI Mumbai eff. from June, 2014,is givenbelow:

(` in Lakhs)

Particulars Current year Previous year Opening balance of amounts transferred to DEAF 155.23 103.33Add: Amounts transferred to DEAF during the year 23.64 52.55Less: Amounts reimbursed by DEAF towards claims 1.99 0.65

Closing balance of amounts transferred to DEAF 176.88 155.23

41


C) Issuer Composition of Non SLR Investments(ìn Lakhs)

Sr. No.

Issuer Amount Extent of below Investment

grade Securities

Extent of ‘unrated’

Securities

Extent of ‘Unlisted’

Securities1 PSUs 4974.23 - - -2 FIs - - - -3 Public Sector Banks - - - -4 Mutual Funds 599.08 - - -5 Others 900.00 - - -6 Provisions held towards

Depreciation 0.00 - - -

Non Performing Non – SLR Investments(ìn Lakhs)

Particulars AmountOpening Balance 0.00Additions during the year 0.00Reduction during the year 0.00Closing Balance 0.00Total Provisions held 0.00





Sd/- Sd/-Lal Hiranandani Shri Dinesh S. Harchandani Director MD-cum-CEO

Statutory AuditorsFor IdentificationIn term of our report of even dateFor R.Devendra Kumar & Associates Concurrent AuditorsChartered Accoutants For Sunny Gopichand BhagiaFRN : 114207W Chartered Accoutants

Sd/- Sd/-(Neeraj Golas) (Sunny G. Bhagia)Partner ProprietorM. No. 074392 M. No. 138716

42


CASH FLOw STATEMENT FOR THE YEAR ENDED ON 31ST MARCH, 2017

PARTICULARS 31.03.2017 31.03.2016 AMOUNT AMOUNT AMOUNT AMOUNT

A CASH FLOw FROM OPERATING ACTIVITIESNet Profit after Tax (Before Appropriation)* 57,794,378.60 68,422,101.31

ADD :

Income Tax** 33,000,000.00 33,000,000.00

Provision for Deffered Tax Liability 414,419.00 (19,187.00)

Provision for Salary Arrears 2,100,000.00 -

Provision for Bad debts - -

Provision for Exgratia 10,000,000.00 10,000,000.00

Provision for Contg. Against Standard Assets 2,182,000.00 500,000.00

Loss on Sale of Assets or w/o 848,498.00 1,385,771.04

Depreciation 8,497,991.00 6,790,695.47

Amortisation of Premium Account 2,074,771.00 668,039.00

Short Provision of Exgratia - -

Previous Years Taxes 255,479.00 -

59,373,158.00 52,325,318.51

LESS :

Profit on Sale of Asset 71,642.00 2,092,106.70

Exgratia Paid 10,000,000.00 8,851,664.00

Excess Provision for Exgratia - 148,336.00

Expenditure & contingencies

10,071,642.00 11,092,106.70

ADJUSTMENT FOR :

Increase/(Decrease) in Deposits & Other Accounts 804,367,457.17 (25,458,686.67)

Increase/(Decrease) in Funds (41,157.00) (17,582,067.93)

Increase/(Decrease) in Other Liabilities 71,188,986.06 (13,893,612.06)

(Increase)/Decrease in Branch Adjustment Account 242,003.81 (295,683.57)

(Increase)/Decrease in Advances (620,768,734.94)

(13,166,346.90)

(Increase)/Decrease in Investments (201,288,712.47)

2,558,604.76

(Increase)/Decrease in Other Assets 7,598,240.97 61,298,083.60 (8,914,876.69) (76,752,669.06)

168,393,978.20 32,902,644.06

Less : Taxes paid 32,152,072.00 51,437,434.00

NET CASH FLOW FROM OPERATING ACTIVITIES (A) 136,241,906.20 (18,534,789.94)

B CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets (34,558,924.00) (8,901,835.00)

Sale of Fixed Assets 581,284.00 8,652,853.91

NET CASH USED IN INVESTING ACTIVITIES (B) (33,977,640.00) (248,981.09)

43


PARTICULARS 31.03.2017 31.03.2016

AMOUNT AMOUNT AMOUNT AMOUNT

C CASH FLOw FROM FINANCING ACTIVITIESProceeds from Issue of Share Capital 8,200,975.00 274,700.00

Payment of Dividend (13,222,571.34) (13,828,312.91)

NET CASH USED IN FINANCING ACTIVITIES (C) (5,021,596.34) (13,553,612.91)NET INCREASE/(DECREASE) IN CASH & CASH EQUIVALENTS (A + B + C)

97,242,669.86 (32,337,383.94)

CASH & CASH EQUIVALENTS AT BEGINNING OF THE YEAR 333,586,218.44 365,923,602.38 CASH & CASH EQUIVALENTS AT END OF THE YEAR 430,828,888.30 333,586,218.44 CASH & CASH EQUIVALENTS INCLUDES THE FOLLOwING :CASH IN HAND 72,081,276.75 35,516,668.95

BALANCE WITH OTHER BANKS 358,747,611.55 298,069,549.49

CASH & CASH EQUIVALENTS AT END OF THE YEAR 430,828,888.30 333,586,218.44



Sd/- Sd/- Sd/-Shri Sitaldas k. Harchandani Dr. Manohar Makhija Shri Bacharam RupchandaniChairman Vice Chairman Director

Sd/- Sd/-Lal Hiranandani Shri Dinesh S. HarchandaniDirector MD-Cum-CEO

Statutory AuditorsFor IdentificationIn term of our report of even dateFor R. Devendra Kumar & AssociatesChartered AccoutantsFRN : 114207W

Sd/-(Neeraj Golas)PartnerM. No. 074392

Note:* An amount of RS. 94.34 Lakhs transferred from General Reserve to Profit & Loss A/c has been adjusted in the cash flow statement being a non

cash item .

** Additional provision for Income tax of RS. 622,881/- has not been adjusted in the cash flow statement being a non cash item .

44


INDEPENDENT AUDITOR’S REPORTReport on the Financial Statements1. We have audited the accompanying financial statements of The Navjeevan Co-operative Bank

Limited which comprises the Balance Sheet as at 31st March 2017 and Profit, Loss Account, the Cash Flow statement for the year then ended and a summary of significant Accounting Policies and other explanatory information incorporated in these financial statements of the Bank along-with its 8 Branches audited by us.

Management’s Responsibility for the Financial Statements2. Management is responsible for the preparation of these financial statements that give true and fair

view of the financial position and financial performance of the Bank in accordance with the provisions of the Banking Regulation Act, 1949 (As applicable to co-operative societies), RBI Guidelines, the Maharashtra Co-operative societies Act 1960 and rules made there under including the Accounting Standards issued by the Institute of Chartered Accountants of India (ICAI) and the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation of the financial statements that are free from material misstatement whether due to error or fraud.

Auditor’s Responsibility3. Our responsibility is to express an opinion on these financial statements based on our audit. We

conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement, whether due to fraud or error.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Branch’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the bank’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion.

6. Basis for Qualified Opinion(a) The Bank has during the year transferred an amount of INR 350 lakhs from Investment Depreciation

Fund to the Profit & Loss Account for which appropriation of equivalent amount (net of transfer to statutory reserve and net of taxes) to Investment Fluctuation Fund is not being proposed, which is not in consonance with regulatory guidelines in this regard. This will also have consequential impact on the balances in reserve fund [Refer Note 3(d)]. Further Premium on Held to Maturity investments is recognized short to the extent of `3.59 lakhs, on account of which, profit would be lower to that extent, with consequential impact on reserve fund balances. [Refer Note 3(b)(i)].

(b) An amount of ̀ 94.34 lakhs has been transferred from General Reserve to Profit & Loss Accounts under the head Provisions and Contingencies, which is required to be shown as distinct from the “Profit for the year” [Refer Note 6(c)].

(c) Pending compliance of Accounting Standards as stated in Note No.7, effect of the same on

45


financial statements, is not ascertained.(d) Pending compliances in respect of Regulatory, Statutory and other matters as stated in Note No.8

including impact if any arising out of migration of data and stabilization of interest application and other modules in new CBS software, accounting of profit or loss on sale of assets , identification and recognition of NPA and our comments and observations, contained in audit memorandum in Part A, B, C, Form 1& 7 attached herewith, the consequential cumulative impact of which on the financial statements is not ascertained.

7. Qualified Opinion In our opinion and to the best of the information and according to the explanations given to us, except

for the possible effects of the matters described in the Basis for Qualified Opinion paragraph, the said accounts read with significant accounting policies and notes on accounts, gives the information required by the banking Regulation Act,1949 as applicable to Cooperative societies, Maharashtra Co-operative societies Act,1960 as amended and rules framed there under in the manner so required and give a true and fair view in conformity with accounting principles generally accepted in India:a) In the case of Balance Sheet, of the state of affairs of the Bank as at 31st March 2017;b) In the case of Profit and loss account of the Profit for the year ended on that date.c) In the case of cash flow statement, of the cash flows for the year ended on that date.

8. Report on Other Legal and Regulatory Requirements: Subject to the foregoing and as required by Section 30 of the Banking Regulation Act,1949 as

applicable to the Co-Operative societies read with the provisions of section 81 of the Maharashtra Co-Operative societies Act,1960, We report that: a) The Balance Sheet, the Profit and Loss Account and the Cash Flow statement have been

drawn up in accordance with the provisions of Section 29 of the Banking regulation Act,1949 as applicable to Cooperative Societies read with the provisions of Maharashtra Cooperative Societies Act,1960 and Maharashtra Cooperative Societies Rules 1961.

b) In our opinion, the Balance Sheet and Profit and Loss Account comply with applicable Accounting Standards except as stated in this report [Refer Para 6(c)].

c) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of the audit and have found them to be satisfactory.

d) The transactions of the Bank, which have come to our notice, have been within the powers of the Bank.e) In our opinion, proper books of accounts as required by law have been kept by the Bank so far

as it appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from the branches.

f) The Balance Sheet and Profit and Loss account dealt with by this report are in agreement with the Books of account.

g) For the year under audit, the Bank has been awarded “A” classification.Place: Mumbai For R Devendra Kumar & AssociatesDate:02/07/2017 Chartered Accountants FRN: 114207W

(Neeraj Golas) Partner M. No. 074392

Auditor Panel No. 14659

46


ANNUAL BUDGET

Targets for the F.Y. 2017-18 (` in Crores)

Target 2017 Particulars Actual 2017 Target 2018 % estimated

change87.00 Capital & Reserves 87.22 94.00 8%

716.90 Deposits 644.47 746.00 16%485.20 Advances 419.51 521.00 24%750.00 Working Capital 752.60 850.00 13%

79.40 Gross Profit 72.81 80.35 10%15.60 Profit before Provisions & Tax 13.65 18.55 36%

7.60 Net Profit 6.66 7.50 13%

PROFIT AND LOSS ACCOUNT (BUDGET FOR 2017-18) (` in lakhs)

Target 2017 INCOME Actual 2017 Target 2018 % estimated

change7013.00 By Interest & Discount 6101.89 7030.00 15%

20.00 By Commission & Exchange 4.36 5.00 15%907.00 By Other Receipts 1174.57 1000.00 -15%

7940.00 SUB TOTAL 7280.82 8035.00 10%By Provisions written back to profit 444.34 0.00Total 7725.16 8035.00

(` in lakhs) Target 2017 EXPENDITURE Actual 2017 Target 2018 %

estimated change

4750.00 To Interest paid on deposits, Borrowings etc

4251.68 4375.00 3%

700.00 To Salaries and Allowances 672.98 755.00 12%530.00 To Rent, Taxes, Insurance,Lighting 469.77 500.00 6%400.00 To Other Adminstrative Expenses 520.82 550.00 6%800.00 To Amount of Provisions 1143.85 1105.00 -3%760.00 To Balance of Profit 666.06 750.00 13%

7940.00 TOTAL 7725.16 8035.00 4%

47


Statement showing Loans & Advances to Directors/ Ex-Directors & Relatives as on 31/03/2017

(` in lakhs)

Particulars Loan Amount Sanctioned during

Co-op. Year 2016-17

Amount of recovery

during Co-op year 2016-17

Amount of Loan outstanding as on

31/03/2017

Overdues if any

No. of A/cs Amount No. of A/cs Amount

(A) Ex-Directors

Term Loan 0 0.00 0.00 1 9.30 9.30

C/C & O/D 0 0.00 0.00 0 0 0.00

Total (A) 0 0.00 0.00 1 9.30 9.30

(B) Relatives (Ex-Directors)

Term Loan 0 0.00 2.13 5 20.45 20.45

C/C & O/D 0 0.00 0.00 1 7.67 7.67

Total (B) 0 0.00 2.13 6 28.12 28.12

Total (A+B) 0 0.00 2.13 7 37.42 37.42

Note : There are no Loans & Advances to present Directors on the Board, all the above Loans are of Ex-Directors of the Bank.

Statement Showing Loans & Advances to Staff as on 31/03/2017(` in lakhs)

Particulars Loan Amount Sanctioned during

Co-op. Year 2016-17

Amount of recovery

during Co-op year 2016-17

Amount of Loan outstanding as on

31/03/2017

Overdues if any

No. of A/cs Amount No. of A/cs Amount

Housing 16 93.90 79.86 82 325.48 0.00

Others 206 141.25 90.00 290 196.05 0.00

Total 222 235.15 169.86 372 521.53 0.00

48


IDEAL RATIOS OF FINANCIALLY SOUND & wELL MANAGED BANK

Sr. No.

Particulars Ideal RatioOur Bank’s

Ratio

1 CRAR Above 12% 13.04%

2 Ratio of Tier -I to Tier-II Capital Above 1.5:1 7.30:1

3 Ratio of Debt to equity Less than 20.1 7.39

4 Coverage Ratio Above 8% 10.20%

5 % of Net NPAs to Net Advances 0% to 8% 2.59%

6 % growth in Gross NPAs over the last 12ms 0% to 5% -1.32%

7 % of Gross NPA to Gross Advances 0% to 9% 6.18%

8 Return on Average Total Assets Above 1.25% 1.97%

9 Return on Average Earning Assets Above 1.50% 1.59%

10 Return on Average Risk Weighted Assets Above 1.75% 2.45%

11 Return on Average Equity Above 20% 22.63%

12 % Growth in Net Profit Above 2% -2.65%

13 Net Interest Margin Above 3% 2.67%

14 Ratio of Non- Interest income to Non- Interest Exps. Above 60 % 71.26

15 Ratio of Retained Earnings to Net Profit Above 70% 78.72

16 Operating Profit as % to Avg. Total Assets Above 2.25% 1.97%

17 Ratio of Customer Deposits and Net Worth to total Assets Above 95% 93.91%

18 Ratio of Bulk Deposits to Total Deposits upto 5% 2.88%

49


NETwORK OF OUR BRANCHESName of Branch Address & Telephone Nos.

1. Main Branch / Head Office Bhawani Saw Mills compound, Ulhasnagar – 421 003.: 0251-6618181 / 6618117Fax-2567523

2. Siru Chowk Akashdeep Shopping Tower, Chellaram Market, Ulhasnagar – 421 002.: 0251 - 2721051 / 2708215

3. Chopra Court Sadoromal Complex, Near Chopra Court,Ulhasnagar – 421 003.: 0251 - 2721054 / 2732340 / 2706493

4. Fountain Ratan Chambers, 1st Floor, Near Ratan Soap Factory, Ulhasnagar-421 004.: 0251 - 2581929 / 2721050

5. Ulhasnagar – 5 B. G.Tilak English School Premises, Nr. Chaliha Sahib Mandir, Ulhasnagar – 421 005.: 0251 - 2531430 / 2526060 / 2721056

6. Ulhasnagar - 1 Gur Plaza, 1st Floor, Opp.Police Station,Ulhasnagar – 421 001.: 0251 - 2721055 / 2708291

7. O.T.Section, Ulhasnagar – 3 Saibaba Educational Trust, O.T. Section,Ulhasnagar – 421 003.: 0251 - 2712072 / 2706170

8. Kopri Colony, Thane Krishna Niwas, Ground Floor, Chhatrapati Co-op. Housing Society Ltd., Plot No.F-3, Kopri Colony,Thane (East) – 400 603: 022 – 25323675 / 25323513

Business Hours – All Branches in Ulhasnagar:All week days ---- 10.30 a.m. to 04.00 p.m.

2nd and 4th Saturday weekly OffBusiness Hours of Kopri Colony Branch – Thane (E):

All week days ---- 09.00 a.m. to 03.00 p.m.2nd and 4th Saturday weekly Off

On-Site ATMsl Main Branch - Ulhasnagar - 3l Ulhasnagar - 5 Branchl Kopri Colony, Thane (E).l Opening Shortly at Chopra Court Branch

50


STATUTORY STATEMENTName of Bank :- The Nav Jeevan Co-op Bank Ltd.

Head Office :- Bhawani Saw Mill’s Compound, Ulhasnagar-421 003.

Date of Registration :- 14.02.1985

Date & No. of RBI Licence :- 12.08.1985 No. UBD MH-435-P.

Jurisdiction :- Thane, Raigad, Sindhudurg & Ratnagiri Districts

Year Ending :- As at 31st March, 2017

No.of Branches :- 8 Branches

Membership - Regular :- 5678

- Nominal :- 582

Paid up Share Capital :- `1058.81 Lacs

Total Reserves & Funds :- `7662.96 Lacs

Total Deposits :- `64447.35 Lacs

of which - Savings :- `17614.43 Lacs

- Current :- `3740.83 Lacs

- Fixed :- `43092.09 Lacs

Total Advances : :- `41950.63 Lacs

of which - Secured :- `41535.88 Lacs

- Unsecured :- `414.75 Lacs

Overdue % :- 6.07 %

Total % of Priority :- 32.32 %

Total % of Weaker Section :- 27.25 %

Borrowings :- `0.00

Investments :- `26775.22 Lacs

Profit for the year (Before Provision & Taxation) :- `1365.56 Lacs

Total Staff - Substaff :- 42

- Others :- 155

working Capital :- `75259.84 Lacs

51


NOTES

52


NOTES

Glimpses of 32nd Annual General Meeting

Glimpses of 32nd Annual General Meeting

31st Annual Day Function

55


A GLIMPSE OF PROGRESS(` in lacs)

Years Owned Funds Deposits Advances Gross Revenue Net Profit working Capital

1990 25.17 341.75 223.54 41.81 9.51 393.21

1991 44.00 482.69 267.17 57.46 5.80 566.99

1992 79.05 603.76 426.01 76.98 30.84 750.51

1993 135.29 987.45 547.35 155.96 26.49 1173.69

1994 228.84 1261.06 877.78 224.05 70.65 1630.93

1995 328.29 1717.10 1071.90 251.95 83.06 2155.04

1996 449.51 2450.77 1445.55 368.05 113.05 3038.32

1997 622.09 3280.33 1621.40 543.58 195.21 4279.91

1998 776.85 3018.36 1568.58 563.33 106.53 4241.48

1999 920.95 4211.39 2035.92 583.30 126.38 5521.53

2000 1139.93 6032.32 2734.96 811.40 154.48 7658.14

2001 1504.62 7967.72 3172.24 1045.99 160.44 9500.00

2002 1765.09 10416.95 4586.87 1524.36 203.25 12612.32

2003 2164.45 11593.46 5745.67 1670.33 230.55 14072.91

2004 2611.86 13109.84 6594.90 1719.83 300.34 16231.70

2005 2967.03 13253.05 6634.92 1540.01 314.64 16878.47

2006 3314.29 15261.53 7602.68 1614.94 300.99 19335.93

2007 3488.14 17415.69 8792.03 1774.24 135.94 22004.95

2008 3858.33 20537.24 11198.40 2163.37 182.68 25304.27

2009 4264.67 23861.81 12319.02 2525.57 220.15 29021.01

2010 4702.28 29175.17 15729.77 2986.92 273.99 34494.79

2011 5266.71 35954.89 22760.94 3783.45 399.40 42969.14

2012 5999.08 40475.47 28002.53 4685.31 448.87 47247.46

2013 6742.79 46786.31 30117.35 5554.25 588.06 54531.54

2014 7316.62 52425.65 33592.25 6017.33 439.21 60675.22

2015 7876.22 56658.27 35611.28 6815.05 611.85 65604.91

2016 8184.33 56403.68 35742.94 7398.77 684.22 65600.00

2017 8721.77 64447.36 41950.63 7280.82 666.06 75259.84

NOTE: The Net Profit figures from the year 2007 onwards are arrived after Provision for Income Tax, which has been made applicable to Co op. Banks since then.

... where service is way of life

Head Office: Bhawani Saw Mills Compound, Ulhasnagar - 3.Phone: 0251-2707291 / 2707391; Fax: 0251-2567523

Email: [email protected];Website: www.navjeevanbank.com

Date post:	31-Mar-2018
Category:	Documents
Upload:	votuyen
View:	221 times
Download:	3 times