IDBI BANK LIMITED
ANNUAL REPORT 2011-2012
DIRECTOR`S REPORT
The Board of Directors of your Bank takes pleasure in presenting its Report
on the business and operations of your Bank for the financial year ended
March 31, 2012.
During the financial year 2011-12, the performance of your Bank has shown
considerable growth on different fronts driven by strategic policy
initiatives; expansion in branch network, focus on improved customer
service delivery, superior product characteristics, which has resulted in
improvement in key profitability indicators. Your Bank was able to widen
its customer base both by expanding its outreach, as also by providing a
range of innovative products and services. As on March 31, 2012 aggregate
deposits and advances of your Bank touched Rs. 2,10,493 crore and Rs.
1,81,158 crore reflecting a growth of 16.63% and 15.32%. The Performance
highlights of your Bank for the period under review are presented in Table
1.
Table 1 : Financial Highlights
Particulars (Rs. in Crore)
As at year-end 2010-11 2011-12
Capital 984.6 1,278.4
Reserves & Surplus 13,582.0 18,148.7
Deposits 1,80,485.8 2,10,492.6
Borrowings 51,569.6 53,477.6
Other Liabilities & Provisions 6,754.8 7,439.9
Total Liabilities 2,53,376.8 2,90,837.2
Cash & Balances with RBI 19,559.0 15,090.2
Balances with Banks and 1,207.0 2,967.4
Money at Call & Short Notice
Investments 68,269.2 83,175.4
Advances 1,57,098.1 1,81,158.4
Fixed & Other Assets 7,243.5 8,445.8
Total Assets 2,53,376.8 2,90,837.2
For the period 2010-11 2011-12
Total Income 20,684.5 25,488.7
Total Expenses (other than 16,526.6 21,432.5
provisions)
Provisions (other than tax) 1,876.9 1,426.5
Profit Before Tax 2,281.0 2,629.7
Provision for Tax* 630.7 598.1
Profit After Tax 1,650.3 2,031.6
* Net of Current Income Tax and Deferred Income Tax
Profit and Appropriations:
During the financial year April 2011 - March 2012, gross income of your
Bank increased to Rs. 25,488.7 crore with contribution of interest income
at Rs. 23,369.9 crore and other income at Rs. 2,118.8 crore. Interest
expenses of Rs. 18,825.1 crore and operational expenses of Rs. 2,607.5
crore, led to total expenditure, excluding provisions and contingencies, of
Rs. 21,432.5 crore during FY 2011-12. Total provisions during the year were
at Rs. 2,024.6 crore, which includes Rs. 591.9 crore towards provision for
bad & doubtful debts and investments, Rs. 263.7 crore towards restructured
assets, Rs. 231.9 crore towards incremental prudential provisions for
standard assets, and Rs. 598.1crore towards tax. The Profit before Tax
(PBT) of your Bank during the FY 2011-12 stood at Rs. 2,629.7 crore. After
making a provision of Rs. 598.1 crore towards taxation, Profit after Tax
(PAT) amounted to Rs. 2,031.6 crore. The appropriation of PAT as approved
by the Board of Directors is given in Table 2.
Table 2 : Appropriation of Profits
Particulars (Rs. in Crore)
As at year-end 2010-11 2011-12
Net Profit for the year 1,650.3 2,031.6
Profit brought forward 479.1 615.0
Profit available for 2,129.4 2,646.6
Appropriations
Appropriations 2010-11 2011-12
Transferred to Statutory 413.0 507.9
Reserve
Transferred to Capital Reserve 1.5 17.0
Transferred to General 600.0 750.0
Reserve
Transferred to Special Reserve 100.0 250.0
created and maintained u/s 36(1)(viii)
of IT Act, 1961
Dividend
- Equity Shares* 344.6 388.7
- Tax on Dividend** 55.3 60.3
Balance of Profit carried to 615.0 672.6
Balance Sheet:
* Dividend on equity shares includes interim dividend of Rs. 2/- per share
paid during 2011-12.
** Tax on dividend includes tax on interim dividend paid during 2011-12.
For each share with face value of Rs. 10, Earning Per Share (EPS) during
the year stood at Rs. 20.6 and Book Value Per Share stood at Rs. 137.24 as
at end-March 2012. The Directors have pleasure in recommending dividend at
35% (including 20% paid on interim basis) on the fully paid-up equity share
capital for the financial year 2011-12.
Capital Adequacy
Your Bank is Basel-II compliant and the Capital to Risk weighted Assets
Ratio (CRAR) is computed in adherence to norms prescribed by RBI in this
regard. Credit Risk is computed using the Standardised Approach, Market
Risk is measured by using Duration Standardised Approach and Operational
Risk measure is Basic Indicator Approach. During FY 2011-12, the equity
shareholding of Government of India has increased to 70.52% as at end-March
2012 through infusion of fresh equity capital to the extent of Rs. 810
crore and conversion of Tier I Bonds of Rs. 2,130.5 crore into equity.
Against the stipulated RBI norm of 9% for total CRAR and 6% for core CRAR,
your Bank`s total CRAR worked out to 14.58 % with Tier-I CRAR of 8.38 % as
at end-March 2012.
Vision and Mission Statement
Over the years, your Bank has undergone a number of structural and
organizational changes while transforming itself into a universal
commercial bank. The journey of your Bank has always encompassed enhancing
value for all its stakeholders. In order to reflect of the current ethos of
your Bank, new Vision and Mission Statement have been crafted. The new
vision statement of your Bank is "To be the most preferred and trusted bank
enhancing value for all stakeholders". With the new vision statement, your
Bank has formalized a goal to share a common dream with all the
stakeholders of the Bank.
Previously, there was no separate Mission statement as the Vision statement
itself incorporated the mission of the Bank. Also, in consonance with the
change in the Vision Statement, a new Mission statement was crafted, in
line with the organization`s long-term and short-term goals. Accordingly,
the mission statement of your Bank is:
* Delighting customers with our excellent service and comprehensive suite
of best-in-class financial solutions;
* Touchingmore people`s lives with our expanding retail footprint while
maintaining our excellence in corporate and infrastructure financing;
* Continuingto act in an ethical, transparent and responsible manner,
becomingthe role model for corporate governance;
* Deploying world class technology, systems and processes to improve
business efficiency and exceed customers` expectations;
* Encouraging a positive, dynamic and performance-driven work culture to
nurture employees, grow them and build a passionate and committed work
force;
* Expanding our global presence;
* Relentlessly striving to become a greener bank.
The mission statement which charts the route map has seven key elements
which will make the new vision come to reality. Your Bank will strive to
provide best in class services and solutions, and maintain high standards
of ethical values. Your Bank will be a responsible bank that contributes to
social sustainability in all its activities. The focus of your Bank would
be on continuous growth and it will continue to delight every customer by
its unique and innovative products and services and pioneering efforts.
Business Strategy
Your Bank`s strategy during the year under review focused on aggressive
growth in Retail lending and repositioning of delivery channels to realize
higher CASA deposits. At the same time, your Bank sought to maintain its
leadership position in the corporate banking and investment banking space,
so as to meet the requirements of the corporate sector. Specific focus was
laid on cross selling of your Bank`s entire product and service offerings
across the entire range of customers, so as to build sustainable and stable
relationships. Your Bank`s strategy during the year resulted in improvement
in various profitability parameters and consolidated its business position
across various benchmarks, so as to bring them more in line with the
prevailing industry standards.
Key Business Initiatives
Your Bank continued to target a progressively larger retail business
portfolio to facilitate a more balanced business mix, in keeping with its
intended positioning as a full-service new generation commercial bank.
Further, in order to build a strong foundation for sustainable growth on
long term basis, as also ensure compliance with regulatory norms, your Bank
took initiatives to build up its priority sector lending portfolio. Your
Bank has been a pioneer in the field of Corporate Finance for the last
nearly five decades. Your Bank has maintained its focus on corporate
banking and laid specific emphasis on cross-selling of your Bank`s diverse
range of products and services. Your Bank increased substantially its
presence in government business and enabled higher direct and indirect tax
collections.
Your Bank offers a bouquet of Liability, Asset, Capital Market and Third
Party products aimed at meeting the customized needs of customers in the
Retail Banking segment. Your Bank introduced a number of products in the
pre-paid cards arena during the year under review. Your Bank has initiated
a project on facilitating usage of ATM network to Co-operative Banks and
RRBs on National Financial Switch (NFS) network in association with
National Payments Corporation of India (NPCI). This would enable Co-
operative Banks and RRBs to issue ATM cards to their account holders and
get connected to the NFS network to have access to more than 84,000 ATMs
across India.
Your Bank entered into MOUs with several reputed educational institutions
across India for granting educational loans to eligible students during the
year. Your Bank is also offering additional concessions to girl students
from SC/ST and Minority communities.
Your Bank had launched its Internet Banking services way back in October
2001. Since then, the ambit of this channel has progressively broadened to
include several value-added services. Keeping in view the need to secure
online shopping/e-commerce based transactions initiated through the
internet banking channel from phishing related frauds, an Online Shopping
Password (OSP) security feature has been introduced by the Bank from
December 2011. Your Bank also introduced an online password-generation
facility for the Retail Net Banking customer, to instantly create their own
login and transaction password and also set their access profile.
As part of a Financial Inclusion project in four Talukas of Gujarat, your
Bank has, inter alia, launched a specially designed Co-branded Photo ATM
Card on `Rupay` Platform. The Card can be used for ATM transactions at your
own as well as other Bank ATMs that are members of National Payment
Corporation of India (NPCI).
Your Bank has constantly endeavored to cater to the diverse needs of its
MSE clients and has continuously been developing customized MSE products.
During FY 2011-12, your Bank introduced a new product, viz., "Line of
Credit to Vendors of Corporates" that augments the liquidity position of
MSE vendors. Considering the growing importance of credit rating for MSE
clients, which enhances the confidence in MSEs while dealing with financial
institutions, banks and corporates for their financial needs and business
opportunities, your Bank signed an MoU with Credit Analysis and Research
Ltd. (CARE) for credit rating of the MSE customers at preferential rate.
Your Bank has put in place a state-of-the-art Technology Platform which is
supporting the Government`s dual objective of improvement of tax collection
efficiency and e-governance. Your Bank had gone live in January 2012 in
providing online duty payment services in respect of Customs Duty for all
the 103 Electronic Data Interchange (EDI) locations across the country.
With this development, taxpayers are now in a position to route all of
their Central Taxes and Duties payments through IDBI Bank, making your Bank
an important Agent in its pursuit of partnering the Government of India in
enabling online tax payments and enhancing the tax contribution to the
Exchequer.
Your Bank became the first ever Bank in the country to launch an internet
based portal dedicated to retail investors in Government Securities. The
portal, named "IDBI Samriddhi G-Sec" has been received favourably by the
investor class. This trend setting initiative by your Bank offers retail
investors the opportunity to benefit from the safety, liquidity and risk
free returns that Government Securities offer.
Your Bank became the first entity from India as also other emerging markets
to access foreign currency funds in the Dim Sum Market. In November 2011,
your Bank raised Renminbi (RMB) 650 million 4.5% fixed rate Dim Sum Bonds
for 3 year maturity. This issue provides testimony to the faith reposed by
global fixed income investors in your Bank.
Organizational Structure
Your Bank has continued its thrust on improving organizational structure,
which places customer relationship and service at the centre of all banking
initiatives. Accordingly, your Bank is currently organized on the lines of
"customer focused vertical" model, capable of delivering improved services.
The model has achieved significant success in enhancing customer
relationship management, improving credit delivery and bringing sharper
focus to business lines which are sustainable and remunerative.
With the addition of 157 branches during FY 2011-12, including Specialized
Corporate Branches, the total number of domestic branches went up to 972 as
on March 31, 2012 in addition to one overseas branch at DIFC, Dubai. Of the
domestic branch network, 264 are located in metropolitan centres, 377 in
urban centres, 236 in semi-urban centres and 95 in rural centres.
Board of Directors
Your Bank`s Board of Directors is broad based and its constitution is
governed by the provisions of the Banking Regulation Act, 1949, the
Companies Act, 1956, the Articles of Association of the Bank and satisfies
the requirements of good corporate governance as envisaged in the Listing
Agreement with the Stock Exchanges. The Board functions
directly as well as through various Board Committees constituted to provide
focussed governance in important functional areas of the Bank.
As on March 31, 2012, the Board of Directors of your Bank comprised of six
Directors with two Executive Directors (including the Chairman & Managing
Director and the Deputy Managing Director), one Non Executive Director and
three Independent Directors. No Director on the Board of your Bank is in
any way related to any other Director on the Board of the Bank.
Apex Committees
The Board has in all eight committees, viz., Executive Committee, Audit
Committee, Shareholders`/Investors` Grievance Committee, Frauds Monitoring
Committee, Risk Management Committee, Customer Service Committee,
Information Technology Committee and Remuneration Committee, to oversee
various functional aspects of the Bank`s business and operations.
Corporate Governance
Your Bank is committed to adopting the best practices in the area of
corporate governance. Your Bank believes that proper corporate governance
is not just a requirement for regulatory compliance, but also a facilitator
for enhancement of stakeholders` value. The details of corporate governance
practices followed in your Bank are given in this Annual Report as a
separate section under the Management Discussion and Analysis.
Statement under Section 217(2A) of the Companies Act, 1956
There were no personnel in the services of the Bank for the whole year, who
were in receipt of remuneration of over Rs. 60 lakh per annum. Further,
there were no personnel, who were in the service of the Bank for part of
the year, received remuneration in excess of Rs. 5 lakh per month for the
period they were in the service of the Bank.
The provisions of Section 217(1) (e) of the Act relating to conservation of
energy and technology absorption do not apply to your Bank.
Directors` Responsibility Statement
The Board of Directors hereby declares and confirms that:
a. in the preparation of accounts, the applicable accounting standards had
been followed along with proper explanation relating to material departure;
b. the Directors had adopted such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of your
Bank at the end of accounting year and of the profit or loss of your Bank
for that year;
c. the Directors had taken proper and sufficient care for the maintenance
of adequate accounting records, in accordance with the regulatory
provisions, for safeguarding the assets of your Bank and for preventing and
detecting fraud and other irregularities;
d. the Directors had prepared the accounts on a going concern basis.
Acknowledgements
The Board of Directors of your Bank expresses its sincere thanks to the
Government of India, Reserve Bank of India (RBI), Securities and Exchange
Board of India (SEBI), Insurance Regulatory and Development Authority
(IRDA) and all other Statutory/ Regulatory Authorities for their valuable
co-operation and guidance. The Board also acknowledges the co-operation and
support rendered by various State Governments and other banking/financial
institutions. The Board thanks various multilateral institutions and
international banks/ institutions for their periodic support. The Board
takes this opportunity to thank all its shareholders and customers for
extending their support during the year and looks forward to their
continued association in the years ahead. During the financial year, the
Bank has received various recognitions and accolades for its excellence in
banking domain. The Board indeed is thankful to all such
organizations/agencies for their appreciation of the Bank`s efforts. The
Board appreciates the sincere and devoted services displayed by its entire
staff and highly values their commitment in improving your Bank`s
performance.
Place : Mumbai R. M. Malla
Date : April 21, 2012 Chairman & Managing Director
BUSINESS ENVIRONMENT
Global Economic Scenario
Growth prospects in the global economy remained muted, with considerable
downside risks, reflecting the fragile nature of economic revival. While
economic recovery gained momentum in the USA and Japan, high level of
deficits continue to persist in advanced economies. Intensifying of the
sovereign debt crisis and mild recession in the Euro Zone area has
adversely impacted economic outlook in advanced as well as developing
markets through trade, finance and confidence channels. Political turmoil
in the Middle East and North Africa has led to a spike in international
energy prices, fuelling the rise in global food prices. Escalating
inflationary pressures in emerging and developing markets has led to
moderation in their pace of growth.
Global financial markets remained subdued as a consequence of tightening of
credit conditions, deleveraging of European banks, emergence of refinancing
risks and global financial stability risks. Emerging and developing
economies faced sharp reversals in international capital inflows and rise
in funding costs on account of monetary policy tightening aimed towards
taming inflationary pressures. The protracted recovery also affected world
trade considerably. The phasing out of fiscal stimulus measures and fiscal
austerity measures adopted by developed economies are expected to further
impact growth prospects in the medium to long term.
Domestic Economic Environment
Real GDP growth decelerated sharply to 6.5% during FY 2011-12 after having
attained stellar growth rate of 8.4% in each of the preceding two years.
High and persistent pressures, which moderated to some extent by the end of
the financial year, necessitated tightening of monetary policy thereby
adversely impacting investment and industrial production in the economy.
Decline in savings and investment rates are a major factor resulting in
slow recovery of growth. Widening of current account balance and
diminishing capital flows have led to sharp depreciation of the rupee.
Fiscal health deteriorated with the fiscal deficit burgeoning to 5.9% of
GDP owing to rise in revenue expenditure and rise in subsidy burden.
REAL SECTOR
Gross Domestic Product (GDP)
As per the revised estimate of Central Statistical Organization (CSO),
growth momentum of the Indian economy has shown deceleration, with Real GDP
recording its slowest pace in nine years. The GDP growth contracted to 6.5%
during FY 2011-12, as compared to 8.4% during the previous two years,
largely due to global uncertainties coupled with domestic structural and
cyclical factors. The
Indian economy was fairly resilient to the global meltdown but could not
shield itself completely from the downturn. The sectoral break-up of GDP
has undergone significant change overtime. The current figures exhibit a
growing contribution of service sector to the overall GDP. The share of
service sector ascended from 58% in FY 2010-11 to 59% in FY 2011-12.
Whereas, the share of Industrial Output shrunk to 27% and that of
Agriculture sector stood at 14% of GDP. The Service Sector, with an
increasing share to the overall GDP, remained the key growth driver. But
the sector though buoyant, still witnessed a slowdown in the pace of
growth. The monetary tightening measures undertaken by the RBI have
resulted in subdued economic growth, dented the local demand and reduced
the investment and industrial activity in the economy. However, the focus
of the policy makers in the ensuing fiscal would be to bring back the
economy to the pre-crisis high growth trajectory.
Industrial Scenario
Industrial growth, measured in terms of Index of Industrial Production
(IIP), demonstrated fluctuating trends through the post-crisis period.
Fragile economic recovery in the US and European countries and passive
domestic business sentiments affected the growth of the industrial sector
in the current year. The Industrial production remained sluggish on account
of the monetary tightening measures, rising input costs, supply-side
bottlenecks particularly in the mining sector, and moderation in investment
demand. Overall, growth during April-March 2012 was 2.8% compared to 8.2%
in the corresponding period of the previous year. The overall performance
in the use-based category highlights the muted business sentiments
indicated by the Capital Goods Sector and a depressed demand in the economy
because of reluctance on the part of the consumers to spend as reflected by
the Consumer Goods Sector.
Inflation
The Indian economy has been battling high inflationary pressures since the
last two years. All major policy stances have been aligned towards reining
in inflation which has been well above the comfort level of the RBI. The
herculean task before the Government and the Reserve Bank of India has been
to strike a balance between growth and inflation dynamics. The WPI
inflation was mainly driven by food
inflation which constitutes a 14.3% weightage in the total WPI inflation.
The problem compounded when the food inflation spilled over to non food
inflation (core inflation), calling for major policy actions. RBI has
played a proactive role by effective monetary policy intervention. There
have been thirteen rounds of monetary tightening since March 2010, with a
375 basis point hike in policy interest rate. The lagged impact of the
monetary tightening was felt in December 2011 and January 2012 when the WPI
inflation decelerated, after hovering around near-double digits for nearly
24 months. The headline inflation fell in the month of March 2012 to 6.89%
as compared to 9.68% in the corresponding period last fiscal. Nevertheless,
the risks from high crude oil prices and the impact of the lagged pass-
through of rupee depreciation, suppressed inflation in energy and
fertilizers and possible fiscal slippage, continues to pose significant
threat. Also inflationary pressures can re-ignite, with the increase in the
excise duty and service tax and rationalization of the fuel and fertilizer
subsidies. The volatile international crude oil prices also pose a major
risk to the domestic inflation.
Liquidity & Interest Rates
The Indian banking system remained in deficit-liquidity mode throughout the
year. Riding on the back of structural issues, deficit in the banking
system mounted to Rs. 1 lakh crore by December 2011 and further rose to
touch a peak of Rs. 2 lakh crore (approx.) on March 31, 2012. The Reserve
Bank engaged in measures like Open Market Operations (OMOs), reduction in
the Cash Reserve Ratio and permitting banks to avail funds under the
Marginal Standing Facility against their excess statutory liquidity ratio
holdings in order to ease pressure on liquidity and ensure adequate
availability of credit to productive sectors of the economy. Adverse market
conditions mainly on account of higher inflation and resultant monetary
tightening measures undertaken by RBI, additional market borrowing
announced by the Government, factors emanating from the euro zone sovereign
crisis and worsening of liquidity conditions led to volatility in the bond
market and rise in bond yields.
Foreign Exchange Reserves & Exchange Rates
As at March 31, 2012, India`s foreign exchange reserves stood at USD 294.4
billion, which were lower by USD 10.4 billion compared to end-March 2011.
Decline in foreign exchange reserves can be attributed to sharp
depreciation of the rupee in the foreign exchange market and pressure on
the balance of payments due to widening of the current account deficit and
decline in capital inflows. The foreign exchange market witnessed
considerable volatility emanating from external economies. While the USD -
INR movement was generally stable in the beginning of the year, as the Euro
zone crisis intensified, inducing risk
aversion amongst the investor overseas, pull-out of capital from the Indian
economy was witnessed. Uncertainties over oil supplies, falling export
numbers, rigid inflation and lower factory productions saw the Rupee
depreciating at a rapid pace.
Future Outlook
The growth dynamics of the Indian economy were severely impacted by the
renewed global economic meltdown. The international factors especially the
Euro-Zone crisis, slowdown in US coupled with bearish domestic fundamentals
have adversely affected the rebound of the growth of Indian economy.
Inflation management has been at the centre of all the policy measures of
the government. This resulted in a tight monetary environment and was a
major setback for the industrial sector which was already reeling under
high interest rate and raw material prices. Higher food prices, supply
constraints, hardening of interest rates, rising input costs including cost
of basic raw materials & oil and weakening capital market are expected to
restrict the scope of investment activities.
The continuing stress in the advanced economies is expected to further
dampen the growth prospects of the Indian economy. Even the scope of
extending further fiscal support is limited due to growing fiscal burden
and limited prospects of revenue collections. The Union Budget 201213 has
laid out an ambitious plan to restrict the fiscal deficit by augmenting
resource mobilization through increased taxes and duties. Though this could
add up to the finances of the government, it has the potential to re-ignite
inflationary pressures. This, in turn, will affect the savings rate in the
economy which has witnessed a setback in the previous year. Any deviation
from the budgeted plan would have negative repercussions for the real
sectors of the economy.
Even with the gloomy outlook, India still remains one of the fastest
growing economies in the world. With measures being taken to remove supply-
side bottlenecks to ease inflationary pressures and progress on fiscal
consolidation, conditions could be conducive for a more favorable growth-
inflation dynamics. However, inflationary pressures, though moderating,
could re-emerge if the upside risks materialize. In the ensuing financial
year, one of the key concerns for the Indian economy is to return to the
high growth trajectory. This is contingent upon various economic factors
with foremost importance to taming inflationary pressures in the economy,
effective supply-side management of inflation and fiscal consolidation.
Focus on these aspects would lead to a reversal of monetary policy cycle
and elevate investment expenditure and business sentiment, boost industrial
production and attract foreign investment and capital flows in the economy,
and thereby lay the foundation for revival of economic growth.
Business Review
Retail Finance
Your Bank continues to target a progressively larger retail business
portfolio to facilitate a more balanced business mix, in keeping with its
intended positioning as a full-service new generation commercial bank.
Pursuant to the same, your Bank currently offers a bouquet of Liability,
Asset, Capital Market and Third Party products primarily aimed at meeting
the customized needs of customers in the Retail Banking segment. Liability
products include Savings Accounts, Current Accounts, Retail Term Deposit,
Recurring Deposits, etc. Asset products on offer include Housing Loans,
Mortgage Loans, Personal Loans, Education Loans, Vehicle Loans, among
others. Your Bank also offers many card products such as International
Debit Card, Gift Card, Cash Card and World Currency Card. Capital Market
and Third Party products/services such as Demat Account, Mutual Funds,
Insurance Products (both Life and General), Government/RBI Bonds, IPO
through Application Supported by Blocked Account (ASBA) process, Investment
Advisory, Merchant Acquisition business, New Pension Scheme, Public
Provident Fund (PPF) and Government of India Senior Citizen Saving Scheme
2004 (SCSS) are also rolled out through your Bank`s retail banking channel.
Your Bank also offers exclusive products for NRIs like NRE/ NRO/FCNR Bank
Accounts, Remittance Services, Portfolio Investment Scheme (PIS) and
Investment Related Products. The products are periodically reviewed and
modifications/ innovations/customization of existing products, as well as
introduction of new products are carried out on a regular basis.
Business initiatives in the retail banking space are appositely
complemented by supportive infrastructure in terms of branch network and
skilled manpower. At the end of the fiscal, your Bank`s domestic footprint
encompassed 972 branches, comprising 264 at metropolitan centres, 377 at
urban centres, 236 at semi-urban centres, 95 at rural centres. Besides,
your Bank had one fully operational overseas Branch at DIFC, Dubai. Your
Bank added 151 new brick and mortar branches during the financial year.
Your Bank, mindful of customer convenience, continued to bolster alternate
delivery channels by expanding its ATM network from 1351 as on March 31,
2011 to 1542 as on March 31 2012.
In the retail liability product segment, your Bank continued to formulate
new products customized to emerging customer needs and increase the
complement of low cost funds. In the CASA category, your Bank added three
new products during the financial year, viz. "Being Me", "Royale Plus" and
"Non - Farmers and Landless Labourers - Saving Bank account cum OD
facility". "Being Me", a youth savings account with an international debit
card, was launched on World Youth Day to foster financial independence,
essence of individuality and responsibility among today`s youth.
With a view to demonstrating your Bank`s appreciation for customers
maintaining a relatively higher balance in their Savings Account, a new
"Royale Plus" Savings Account sub-segment was carved out from within the
broader IDBI Royale Account category for customers maintaining an Average
Quarterly Balance (AQB) of Rs. 5 lakh with preferential/value-additive
facilities.
In keeping with your Bank`s pursuit of more inclusive banking, your Bank
launched a product "Non - Farmers and Landless Labourers - Savings Bank
account cum OD facility", which gives the benefit of Savings account with
overdraft facility up to Rs. 10,000/- to address the credit needs and
contingencies of relatively disadvantaged sections of society.
In the Term Deposit segment, your Bank added three new offerings to its
existing bouquet of products viz: Fixed Deposit for Motor Accident
Tribunals, Suvidha Suraksha Recurring Deposit (SSRD) and Godhuli Fixed
Retail Term Deposit (GRTD).
Fixed Deposit for Motor Accident Tribunals was launched to capture the
compensation money awarded by the Motor Accident Tribunal by offering the
highest interest rate under FD for such funds. The welfare and convenience
of Senior citizens continue to be a priority area for your Bank. Reflecting
the same, a new product "Godhuli Fixed Retail Term Deposit (GRTD)" was
launched exclusively for prospective Senior citizens aged between 55 and
above to less than 60 years, whereby the depositor would automatically get
additional rate of interest as applicable for Senior Citizens, without
breaking the FD prematurely, on attaining the age of 60 years. This segment
would also benefit from an additional interest of 50 basis points over and
above the normal rate of interest accorded on Recurring Deposits maintained
by them with your Bank.
In the recurring Deposit space, a new variant, `Suvidha Suraksha Recurring
Deposit` was launched, which invests the Term Deposit with added protection
of life insurance cover.
Your Bank greatly values its relationship with the NRI Clients and
undertook various initiatives to increase its market share in this segment
and deepen existing relationships, with a fair measure of success. Your
Bank has entered into an arrangement with certain forex service providers
to facilitate remittances, in association with Western Union. Your Bank has
extended its tie-up under Portfolio Investment Scheme (PIS) to several
leading stockbrokers by entering into MOUs with them for providing PIS
Services to their NRI Clientele. Your Bank has entered into an MOU with
different Exchange houses for routing remittances from Gulf countries. Your
Bank has operationalised a scheme to place Bank officials in Exchange
Houses in the "GLOBAL CURRENCY CARD" (GCC) Countries to source NRI
Business. Consequent to de-regulation of interest rates on NRE FDs, your
Bank competitively positioned its NRE FD rates to enlarge the NRI Customer
base of your Bank.
In the retail lending space, your Bank broadened its delivery channel by
adding 13 new Retail Asset Centers (RACs), in Tier II and Tier III cities,
during the year. Your Bank continued to be responsive to customer
sentiments during the financial year. As a part of this initiative, your
Bank introduced Festive offers in Home Loan and Auto Loan segments in
October 2011. Interest rates on home loans were reduced by 25 to 50 bps
depending on loan size during the festive period, which was subsequently
extended up to March 31, 2012. Further, to enable your Bank`s customers to
benefit from partly fixed rates, a new `Fixed First Home Loan` scheme was
launched, offering a combination of fixed and floating interest rates on
home loans.
With a view to increase penetration in Auto Loan segment and deepen the
relationship with existing liability customers, your Bank also launched
special festive campaign during the period October-December 2011. Auto loan
customers were offered concession of 100 basis points in Rate of Interest
and waiver of processing fee under the scheme.
Your Bank entered into MOU with several reputed educational institutions
pan India for granting educational loans to eligible students during the
year. Your Bank is also offering additional concessions to girl students
from SC/ST and Minority communities. Your Bank has further devised a
special educational loan product for students hailing from the villages
assigned to the Bank under Financial Inclusion Programme with a
concessional rate of interest and special underwriting norms.
Your Bank continues to actively participate in government-sponsored schemes
like Interest Subsidy for Housing Urban Poor (ISHUP), 1% interest
subvention for housing loan, Rajiv Gandhi Gramin Niwara Yojana (RGGNY),
Central Scheme for Interest Subsidy for Education Loans; etc. as part of
its affirmative action to complement government initiatives of providing
housing and educational facilities to Economically Weaker Sections (EWS)
and Lower Income Groups (LIG).
Your Bank continued to strengthen its Alternate Banking channels like ATMs,
internet banking, mobile banking, etc. to provide the customers with
enabling options to reduce their dependence on branch channel while
simultaneously offering 24*7 capabilities. From the Bank`s perspective,
they are also cost-effective as the transaction cost is less compared to
the branch channel. The Alternate Channels and Merchant Acquisition
Business also provide avenues to your Bank for augmenting fee-based income,
apart from helping acquire/deepen existing relationships.
Your Bank had launched its Internet Banking services way back in October
2001. Since then, the ambit of this channel has progressively broadened to
include the following transactions: account enquiry, opening of FDs and
RDs, statement of account, fund transfer, on-line tax payment, on-line
shopping/bill payments, card-to-card money transfer, mobile recharge, on-
line booking of Air/ Rail tickets, online IPO ASBA, on-line trading of
securities and Demat / GOI bond operations.
During the FY 2011-12, net Banking facility has also been extended to minor
accounts operated by natural guardians, except for the Power KIDZ Accounts,
where operations are performed by the minors themselves. Keeping in view
the need to secure online shopping / e-commerce based transactions
initiated through the internet banking channel from phishing related
frauds, an Online Shopping Password (OSP) security feature has been
introduced by the Bank from December 2011. Your Bank has also introduced an
online password-generation facility for the Retail Net Banking customers,
to instantly create their own login and transaction password and also set
their access profile. This feature has brought immense convenience to the
customers by eliminating delays in receipt of the physical/printed password
and has also resulted in huge savings for your Bank in terms of stationery,
staff, courier and other printing and dispatch related infrastructure
costs.
Your Bank was among the first few banks to launch query-based information-
serving Mobile banking services in 2001. Subsequently, the Account Alert
Service was launched enabling the Bank`s customers to also receive SMS
alerts for various transactions/activities in their accounts as per their
choice. The Bank launched the Mobile payment service in December 2008 in
association with PayMate, one of the leading M-Commerce players in the
country. The Mobile Payment facility enables your Bank`s customers to use
PayMate`s easy, convenient and secure mobile payment service. Customers can
use their mobile phones to pay for utility bills, movie & air/railway
tickets, restaurant bills, online purchases, mobile recharge, and retail
shopping at over 15,000 merchants in India registered with PayMate.
Your Bank launched Mobile Vans fitted with ATM/I-net banking facilities
during the year to promote Financial Inclusion and facilitate sale of
banking products /service delivery amongst villages in its catchments area.
Your Bank has initiated the project on facilitating usage of ATM network to
Co-operative Banks and RRBs on National Financial Switch (NFS) network in
association with National Payments Corporation of India (NPCI). Under this
model, your Bank will act as a Sponsor Bank for facilitating usage of ATM
network to Co-operative Banks and Regional Rural Banks on NFS. This will
enable the Co-operative Banks and RRBs to issue ATM cards to their account
holders and get connected to the NFS network to have access to more than
84,000 ATMs across India.
Your Bank introduced a number of pre-paid card products during the year
under review. A novel clutter-breaking product, IDBI Magic Card was
introduced in August, 2011 for the Bank`s new Corporate Salary accounts, to
begin with. It encompasses the features of a Debit Card with a credit limit
and charges much less than a regular credit card. "Being Me Debit Card" was
also launched during the year with a focus on the younger generation in the
age group of 18-25 years.
As part of continuing product development aimed at eliciting customer
delight, a new pre-paid travel Card entitled "GLOBAL CURRENCY CARD" (GCC)-a
foreign currency pre-paid card- was introduced on MasterCard platform for
the global traveller. The existing pre-paid card- the World Currency Card
(WCC) - operated on VISA platform only. The GCC will have access to over
1.9 million MasterCard / Maestro/ Cirrus ATMs for Cash Withdrawal and
Balance Inquiry. The Card can also be used for purchases at over 32.9
million acceptance locations across 210 countries and empowers the
cardholders to shop online. The GCC also comes with a slew of insurance
benefits. Initially, this product would be offered in USD only and would be
extended to various other currencies going forward. Both WCC and GCC offer
cardholders the convenience of a Traveller`s Cheque, the safety of an ATM
card and the acceptance of credit card, all rolled into one. These cards
can be used both at ATMs and at Merchant Establishments abroad where
VISA/Master cards are accepted.
Your Bank launched a Co-branded prepaid card "Freedom Prepaid Card" in
February 2012, in association with Itz Cash Cards Ltd. It is a general
purpose reloadable co-branded Card issued on Master Card platform and will
be accepted for cash withdrawals at ATMs, as well as for purchase
transactions at POS terminals deployed at physical merchant establishments
and for on-line payments at e-commerce web sites with additional security
of second factor authentication. The card is primarily targeted at certain
sections of the society, particularly youth, who prefer to pay for goods
and services using cash.
Your Bank also launched various promotional offers, including cash back
offers, during the year to promote debit card usage at designated Point of
Sale (POS) outlets, in association with VISA/MasterCard.
As a part of a Financial Inclusion project in four Talukas of Gujarat, your
Bank has inter alia launched a specially designed Co-branded Photo ATM Card
on `Rupay` Platform. The Card can be used for ATM transaction at our own as
well as other Bank ATMs that are members of National Payments Corporation
of India (NPCI).
Your Bank constantly endeavours to provide value-added services to its
customers, aligned to their risk profile and financial goals. Your Bank has
tied up with over 35 Asset Management Companies (AMCs), including IDBI
Mutual Fund, to provide a bouquet of diversified financial products to suit
the investment needs of its customers. Your Bank is also a distributor of
Fixed Income Securities viz. Capital Gains Bonds, Government of India
Bonds, various Tax Free and Tax Saving Bonds. Your Bank has been enlisted
as a registered Point of Presence (PoP) of Pension Fund Regulatory and
Development Authority`s (PFRDA`s) National Pension Scheme (NPS). The Scheme
is a safe and flexible system, which was introduced by Government of India
to provide the citizens with regular post-retirement income stream. Your
Bank is now system-ready to offer the recently launched `Corporate Module`
of PFRDA`s NPS to its corporate customers, which would enable the latter to
provide co-contributory pension benefits to their employees.
In order to cater to the investment cum safety needs of the customers, your
Bank offers Life Insurance solutions to suit various customer segments,
through IDBI Federal Life Insurance Company Ltd. Your Bank is a Corporate
Agent of Bajaj Allianz General Insurance Co. Ltd. to offer Non-life
insurance products ranging from asset, health and personal accident.
Financial Inclusion
In meeting the objective of Financial Inclusion as articulated by the
Government of India, your Bank has initiated Financial Inclusion Plan (FIP)
for the first three years ending March 31, 2013. Your Bank has, as per the
requirement, covered all the allotted 119 villages with population more
than 2000 by the end of FY 2012. These villages are located in the States
of Maharashtra, Chhattisgarh, Madhya Pradesh, West Bengal, Himachal Pradesh
and U.T. of Dadra and Nagar Haveli. In addition to these villages, your
Bank also aims to cover some more villages with population between 1000 and
2000 during FY 2013, as and when allotted by SLBCs.
The FIP of your Bank has been implemented by using Information &
Communication Technology (ICT) based smart card solution through Business
Correspondent (BC) model. Services of various Technology Service Providers
(TSPs) across geographical segments/locations have been utilized for
financial inclusion drive. The TSPs provide end-to-end solution including
management of BCs/CSPs (Customer Service Points). Every customer in the
unbanked village has been provided with a biometric smart card as per the
specifications of Institute for Development and Research in Banking
Technology (IDRBT) and capable of incorporating around ten functions. As on
March 31, 2012, your Bank has opened 42,079 accounts under financial
inclusion. These accounts witness an average number of 113 transactions per
day with average amount of Rs. 741/-per transaction.
Your Bank took a step further towards inter-operability of BCs across all
villages by introducing on-line solution for customers` transactions in
some of the villages allotted for financial inclusion. Gradually, all the
119 allotted villages would be put on on-line mode. Apart from the basic
services which are being offered under financial inclusion, your Bank
introduced, during FY 2012, various other products such as Education Loan,
Fixed Deposit, Recurring Deposit and micro insurance product known as
"Grameen Suraksha" for the benefit of customers. During the year, your Bank
also established Ultra Small Branches (USBs) in 16 villages covered under
FIP, as per the directions of the Ministry of Finance. A USB means some
space is earmarked in village panchayat office for a bank official, who
would be visiting the USB once a week at a fixed timing on a particular day
to cater to various requirements of the villagers like balance enquiry,
loan enquiry, processing of loan applications, recovery follow-up, etc.
Gradually, USB would be established in all the allotted villages where
basic banking services are already being provided through BC model.
Further, in order to widen the Bank`s reach under urban financial
inclusion, as also to give a fillip to Government`s objective of electronic
transfer of benefits, your Bank during the year has obtained mandate from
Raipur Nagar Nigam for distribution of social security pension to about
22,000 pensioners through smart cards. BCs are also being appointed in 2
Panchayats of 24 South Parganas District, West Bengal for catering to the
banking needs of the people of these panchayats. Your Bank is also in the
process of exploring such partnership with other government bodies.
Your Bank has acted as a Registrar with Unique Identification Authority of
India (UIDAI) for implementation of the UIDAI project for issue of
`Aadhaar` identity cards to the customers of the Bank to link their account
with Aadhaar as per RBI/Government directives. During the year, your Bank
has enrolled 1 lakh customers across various geographical locations. Your
Bank expects to enroll a larger number of customers during FY 2013.
Your Bank aims to bring unbanked populace within the ambit of formal
banking system, thereby increasing their access to financial services,
opportunities to build savings, make investment and harness their earning
capacity and entrepreneurial talent. Your Bank therefore signed an MOU with
Tata Institute for Social Sciences (TISS) for promotion of Financial
Inclusion Program under which the Bank has sponsored 15 fellowships for
TISS graduates to be stationed at select villages. Under the programme,
named "Rural Transformation Fellowship Program (RTFP)", each fellow has
been allotted a cluster of villages where they would undertake socio-
economic survey of the village and provide assistance to the villagers
through financial inclusion initiatives of the Bank. The three major
aspects of the RTFP are to make people aware of (i) accessing financial
markets, (ii) Accessing credit markets and (iii) Learning financial matters
(financial education). During the fellowship, the Fellows are required to,
inter alia develop a comprehensive village profile as a baseline; focus on
Financial Awareness & Literacy, social entrepreneurship development,
Capacity Building and Pilot Projects and work with Marginal and Excluded
Groups.
The "Rural Transformation Fellowship Program" of your Bank has been
adjudged the Winner in the Category of "Development Finance-Led Poverty
Reduction" by the Association of Development Financing Institutions in Asia
and the Pacific (ADFIAP).
MSE Initiatives
Your Bank continued its thrust and due importance to the role of Micro,
Small and Medium Enterprises (MSMEs) towards building a strong foundation
for sustainable growth on long term basis. Duly recognising the importance
of MSEs in the socio economical growth of the nation, your Bank has
continued its focus on Micro and Small segments of MSMEs, which are
considered as growth engine of the Bank. With an effort to reach out to MSE
clients to serve them better and take the MSE Banking facilities to their
easy reach, your Bank has set up dedicated MSE Care Centres in 30 major
cities/clusters, besides its regular branch network.
Your Bank always endeavors to cater to the various needs of the MSE clients
and has continuously been developing customized MSE products from time to
time. During FY 2011-12, your Bank introduced a new product `Line of Credit
to Vendors of Corporates` that enhances the liquidity position of MSE
vendors, which are an important link in
the value chain. Availability of credit at reasonable cost has always been
a concern for MSEs and keeping this in view, your Bank has introduced
rating-linked pricing for MSE customers, enabling credit facility at
attractive and competitive rate of interest. As a result of the aforesaid
initiatives, MSE business of your Bank has grown by around 50% during the
year.
Considering the growing importance of credit rating for MSE clients, which
enhances the confidence in MSEs while dealing with financial institutions,
banks and corporates for their financial needs and business opportunities,
your Bank signed a MoU with Credit Analysis and Research Ltd. (CARE) for
credit rating of the MSE customers at preferential rate. Your Bank has also
signed a MoU with the Office of the Development Commissioner, Ministry of
MSME, GoI, for promotion of employment/ self-employment through Micro and
Macro enterprises to enable the NGOs to develop their capabilities in
implementing micro and macro credit programmes under the Trade Related
Entrepreneurship Assistance and Development (TREAD) Scheme.
Appreciating the importance of MSE sector in the development of the nation,
your Bank has actively participated in various trade fairs and MSE
promotional events organised by various Industry Associations and nonprofit
organizations during the year.
Agriculture and Rural Development
Agriculture continues to be the most important sub-sector of Indian
Economy. Agriculture provides employment to large number of our rural
population and has its own importance in food security of our country.
Agriculture sector, therefore, finds important place in our National
agenda. One of the challenges before our country is to improve productivity
of agriculture sector to meet ever-increasing need of quality food for
nourishing our growing population. Your Bank, therefore, believes that
agriculture lending is not merely a business process but an opportunity to
participate in the rural and agricultural development of our country.
Your Bank has established a network of officers under a dedicated `Agri
Business Group` across the country to provide knowledge-based credit to our
farming community to improve farm productivity and quality of life of our
rural population. Agri business, in your Bank, is presently handled at 334
branches, which are attached to 21 Agri Processing Centers, reporting to
seven dedicated regional offices for speedy disposal and quick decisions.
Agriculture business of your Bank comprises direct lending to the farmers
or group of farmers, assistance to corporate or co-operatives engaged in
processing of agriculture produce and entities involved in supporting
agriculture sectors. During FY 2011-12, your Bank introduced simplified
documentation process; stream lined sanction and delivery systems with
desired flexibility and control in retail agriculture lending. This has
helped your Bank to broaden its retail agriculture base. Your Bank has tied
up with select corporates and co-operatives engaged in agro and food
processing activities to reach out to a large number of farmers and deepen
its retail base across the country. To reach large number of farmers,
particularly those in remote part of the country, your Bank has appointed
Business Facilitators at such locations.
Your Bank continued to encourage formation of Farmers` Clubs in the
villages covered by our rural branches. Your Bank considers the members of
Farmers` Clubs as true grass root level agriculture extension workers and
supports them in all activities that involve sharing of their knowledge
amongst fellow farmers.
IDBI Rural Self Employment Training Institute, Satara.
Your Bank established its first Rural Self Employment Training Institute
(IDBI-RSETI) at Satara District of Maharashtra as per the guidelines issued
by the Ministry of Rural Development, Government of India. With effect from
October 31, 2011 the institute has commenced conducting free residential
training programs for rural unemployed youth in this district. Training
courses focus on skill and entrepreneurship developments so that they could
set up their own small enterprise. IDBI-RSETI has conducted eight training
programmes for 224 youth in 2011-12.
IDBI Agriculture and Rural Development Trust
Your Bank has established a Trust named as "IDBI Agriculture and Rural
Development Trust" mainly to manage IDBI-RSETI as required under the
guidelines issued by the Ministry of Rural Development, Government of
India. Apart from this the Trust would also undertake development and
research activities in rural and agriculture sector. The Trust would help
your Bank to discharge duties under its Corporate Social Responsibility.
Corporate Finance
Your Bank has been a pioneer in the field of Corporate Finance for the last
nearly five decades and has been supporting the diversified needs of
Corporate sector in its growth process. During the FY 2011-12, your Bank
opened one more dedicated specialized Corporate Branch at Bandra Kurla
Complex in Mumbai. With this the total number of Specialised Corporate
Branches across the country stands at 33. Your Bank`s Corporate Business
has grown by about 20% during the last year. Your Bank also meets the
foreign exchange needs of Corporate Clients through its Dubai Branch which
went operational in the year 2010.
Your Bank offers tailor made structured products, both asset as well as
liability, depending on the needs of the Corporates. Your Bank has also
carved out a niche for itself in the Transaction Banking segment like the
Cash Management Services, Government Agency Tax Collection and Trade
Finance Products. Your Bank also offers treasury and loan syndication
services to its corporate clients. During the year, your Bank facilitated a
cross border deal by sanctioning financial assistance in Foreign Currency
to one of the large Indian Corporate Groups for acquiring a company based
in Europe. The acquisition transaction was typical in nature and involved
various processes to handle issues relating to cross border regulatory
norms, taxation, due diligence, valuation of the company, environmental due
diligence issues, creation of cross-border security, etc. and reflects the
wide expertise available in your Bank for addressing the needs of the
Indian corporate sector.
Trade Finance
Your Bank continued to post high growth rates in Trade Finance (TF)
Business. During the FY 2011-12, the non-fund based business of your Bank,
comprising of Letter of Credit (LCs) and Bank Guarantees (BGs) segment grew
by 17% crossing Rs. 70,000 crore. Trade Finance related fee income also
recorded robust growth of 37% during the year. Your Bank has earned Trade
Finance related fee income of Rs. 640 crore out of total fee income of Rs.
1,715 crore earned during the year. Your Bank has entered into Whole
Turnover Packing Credit ECIB (WT-PC) and Whole Turnover Post Shipment ECIB
(WT-PS) with effect from April 1, 2012 with ECGC for Export Credit
Insurance Cover for Bank. During the year, your Bank opened two new TF
Centres at Faridabad and Ghaziabad, thereby increasing the total number of
TF locations from 37 at the beginning of the year to 39. During the year,
the Bank has put in place specialized Sales Teams exclusively for TF
products at the metros with a special focus on Retail Trade Business which
will enhance the Bank`s TF Business, inter alia, in the Retail Segment.
Strengthening collaborative relationship with leading foreign banks
continues to be your Bank`s priority towards enhancement of Trade Finance
Business as well as Fee Income for your Bank.
Government Business
Your Bank has placed strong focus on Government Business and collects
direct and indirect taxes of Central Government and various State
Governments. During the FY 2011-12, your Bank had crossed a major milestone
in collection of tax of Rs. 1 lakh crore to achieve total tax collection of
Rs. 1.24 lakh crore. Further, your Bank added another feather in its cap by
collecting more than Rs. 1.12 lakh crore in respect of Central Taxes during
FY 2011-12. The tax collection is facilitated mostly through e-payment
besides physical mode. During the year, your Bank operationalised
collection of commercial taxes in the states of Assam, Bihar and
Puducherry. With this your Bank is now authorized to collect Commercial Tax
in the states of Assam, Andhra Pradesh, Bihar, Gujarat, Maharashtra, Punjab
(Phagwara), Rajasthan, Uttarakhand and in the Union Territory of Delhi and
Puducherry. Your Bank also got clearance from the states of Karnataka,
Tamilnadu, West Bengal and Sikkim for commercial tax collection and is
expected to commence tax collection in these states during the first half
of FY 2012-13.
Your Bank had gone live on January 16, 2012 in providing online duty
payment services in respect of Customs Duty for all the 103 Electronic Data
Interchange (EDI) locations across the country. With this development,
taxpayers are now in a position to route all of their Central Taxes and
Duties payments through IDBI Bank, making your Bank an important Agent in
its pursuit of partnering the Government of India in enabling online
payments and enhancing the tax contribution to the Exchequer.
Your Bank has also put in place state-of-the-art Technology Platform which
is supporting the Governments dual objective of improvement of tax
collection efficiency and e-governance.
Cash Management Services
Cash Management Services, which are one of the major avenues for Current
account mobilisation, continued to be one of the thrust areas of your Bank
during the year. Your Bank has a marked presence in this business segment
and has bagged some of the prestigious mandates for dividend servicing.
Also, your Bank has earned market recognition as Bankers to Issue for IPO
/FPO /Bond Collection assignments. Your Bank is focussing on providing
customized e-solutions including technological integrations with client
systems in tune with the evolving market requirements. The Bank is
constantly upgrading its systems towards this end.
Infrastructure Finance
Your Bank continues to remain a prominent player in infrastructure
financing, which typically involve long gestation period and have a
distinct risk and return profile requiring innovative structuring. Your
Bank has been in the forefront in structuring and financing of
infrastructure projects in the areas of power, telecom, roads, airports,
seaports, railways and logistics, as well as Special Economic Zones (SEZs),
ever since the infrastructure sector was opened to private investment, and
a significant share of its aggregate assistance goes to infrastructure
sector.
Investment in infrastructure assumes greater importance in today`s economic
scenario. Several new projects have been lined up in the road, port,
airport, power and other infrastructure sectors. Recognising the critical
role of infrastructure development in the growth of national economy and
also the huge investment required in the sector, focused approach was
followed to provide end-to-end solutions to the infrastructure companies
viz. corporate advisory, syndication of debt/equity, financial structuring,
term loans, working capital, securitization and other related services.
Your Bank has also taken initiatives in funding urban infrastructure
projects, renewable energy projects (solar, wind and bio mass based power
projects), seaports and airports under the Public-Private Partnership (PPP)
route. Through its overseas branch, your Bank is also in a position to
extend, selectively, foreign currency denominated loans to infrastructure
projects.
An extensive and efficient infrastructure network is critical for the
effective functioning of the economy and is a major requirement for
sustainable and inclusive economic growth. Over the years, the Government
has taken various initiatives to accelerate the pace of infrastructure
development and reduce the infrastructure deficit in the country. While
presenting the Union Budget for 2011-12, the Hon`ble Union Finance Minister
announced a proposal to create Special Vehicles in the form of notified
Infrastructure Debt Funds in order to augment the flow of long-term, low-
cost foreign funds for the infrastructure sector. Your Bank has been a
pioneer in infrastructure financing and has provided financial support to a
number of infrastructure projects across the spectrum of industries. Given
the growing need of funds to meet the requirements of projects in the
infrastructure sector, your Bank has decided to set up an Infrastructure
Debt Fund in the form of an NBFC, viz., IDBI Infrafin Limited (IIL). The
NBFC (IIL) was incorporated on February 27, 2012 with an Authorised Capital
of Rs. 1,000 crore. As the sponsor of the company, your Bank would have
equity holding of 30% in the company; the other strategic investors would
be leading Public Sector Banks/ Financial Institutions. In order to be
compliant with RBI Guidelines, the initial Paid-up Capital has been set at
Rs. 300 crore, of which your Bank would be initially subscribing Rs. 90
crore (30%).
Syndication, Structuring and Advisory Services
Your Bank has been active in providing debt syndication, structuring and
advisory services to corporates in infrastructure as well as manufacturing
sectors. During the past few years, your Bank has assisted several large
projects including Ultra Mega Power Projects, Metro Rail Projects,
Airports, Ports, Roads, Oil Refineries, Renewable Energy Projects, Steel
Plants, etc. in achieving financial closure through debt syndication. In
some cases, your Bank underwrites the entire or a part of the debt
requirement to ensure speedy financial closure. So far, your Bank has
completed debt syndication mandates aggregating more than Rs. 2 lakh crore.
Your Bank has been consistently ranked as one of the leading debt
syndicators in India, as well as entire Asia Pacific region. Your Bank also
provides structuring and advisory services to developers interested in
bidding for infrastructure projects. Your Bank has a team of qualified and
experienced professionals to provide these services. Reckoning clients`
special needs, tailor made solutions are being provided promptly. Almost
15% of the total fee based income of your Bank during 2011-12 was
contributed by syndication, structuring and advisory services.
Environment Protection Schemes
Your Bank has undertaken a pioneering role in Indian banking sector in the
area of environmental banking. Besides offering various banking services,
your Bank has been providing services in the area of Clean Development
Mechanism (CDM)/Carbon Credits under Kyoto Protocol and Voluntary Emission
Reductions (VERs). Your Bank has also been acting as financial intermediary
for World Bank funding under Ozone Depleting Substance (ODS) phase out
schemes since 1991 and India Chiller Energy Efficiency Project (ICEEP), a
unique project aimed at mitigating global warming and phasing out of ODS in
the chiller sector since 2009.
Carbon Credit Services
Your Bank has set up a team for providing specialized carbon
credits/emission trading advisory on Clean Development Mechanism (CDM).
Your Bank is facilitating all the services related to CDM projects and
carbon credit market, viz., funding of the CDM projects; providing
technical advisory services for registration of CDM project, providing
advisory services for Trading of Certified Emission Reductions (CERs) and
Verified Emission Reductions (VERs), upfront financing against the carbon
credits/carbon credits receivables, advisory services for Programmatic CDM.
Ozone Depleting Substances (ODS) Phase-out projects
Your Bank is acting as Financial Agent (FA) for the World Bank (WB)
administered Ozone Depleting Substances
(ODS) Phase-out projects (ODS III & IV) of Ozone Trust
Fund (OTF) for implementation of the projects aimed at phasing out
production and use of Chlorofluoro Carbon (CFC) and Carbon Tetrachloride
(CTC) in India as required under Montreal Protocol. WB and GOI have
extended the tenure of ODS III and ODS IV projects upto April 30, 2012 and
December 2012 respectively. Cumulatively, upto March 31, 2012, grant funds
aggregating USD 123 million have been released through your Bank under ODS
III & IV projects.
Treasury Operations
Your Bank has an integrated Treasury at its Head Office covering various
operations including Money Market, Fixed Income, Foreign Exchange,
Derivatives and Equities trading operations for optimum management of funds
and returns, while providing a wide range of products viz. G-Secs, forex,
derivatives, CDS and exchange traded currency futures and options to
customers.
Besides deposits, your Bank used various instruments including Certificates
of Deposits, Inter Bank borrowing, issuance of Bonds, refinance from
various institutions and foreign currency borrowing to manage liquidity for
balance sheet growth and maturity of liabilities. The short term liquidity
was managed through call, Collateralized Borrowing and Lending Obligation
(CBLO), and LAF market operations. Despite considerable volatility and
hardening yields, your Bank managed the SLR portfolio profitably.
Credit Default Swap (CDS) was introduced in the Indian market by RBI this
year on November 30, 2011. Your Bank was the first Bank to sell a
protection under CDS in the domestic market on December 7, 2011 and your
Bank received accolades in the FIMMDA conference held in Malaysia on
January 26, 2012 and received recognition from the hands of Dr. Zeti Akhtar
Aziz, the honourable Governor of the Malaysian Central Bank. Your Bank has
become the leader in India for the CDS market which offers a large
potential for hedging the credit risk, as well as market making on CDS.
Your Bank`s Treasury has a large sales team spread across 10 centers for
effective marketing of foreign exchange and derivative products. The team
interacts constantly with the corporate clients and proactively provides
them solutions to effectively manage their volatilities in the currency and
rates markets. During FY 2011-12, your Bank provided various types of
customized solutions at competitive rates to cater to customers for their
foreign exchange and interest rate hedging requirements through mix of
options and swaps as permitted by RBI.
In addition, your Bank has set up debt sales team at various centres which
cater to the needs of the clients falling outside the screen based NDS-OM
market. Your Bank innovatively harnessed technology to meet the untapped
potential of retailing of government securities in the Indian Market. Your
Bank became the first ever Bank in the country to launch an internet based
portal dedicated to retail investors in Government Securities. The portal
has been christened as "IDBI Samriddhi G-Sec" which has been received
favourably by the investor class. This trend setting initiative by your
Bank offers retail investors the opportunity to benefit from the safety,
liquidity and risk free returns that Government Securities offer.
Cross Border Branches
With the faster pace of globalization, many of your Bank`s valuable
customers require cross border finance. In this direction, your Bank has
established its presence in .the overseas markets to cater to the financing
needs of its Indian clientele and also leverage its domestic banking
strengths to offer competing products internationally.
Your Bank`s first overseas branch at the Dubai International Financial
Center (DIFC), Dubai has completed over two years of operations. From DIFC
Branch, your Bank provides a range of corporate banking services, including
extending of ECBs, foreign currency loan syndication and trade finance
products for its Indian clients` fund requirements for their Indian
operations as well as overseas ventures. The DIFC Branch also serves as the
nodal point for your Bank for raising foreign currency resources.
Your Bank`s DIFC Branch has earned a Net Profit of USD 14.16 million for
the current year ended March 31, 2012.
Your Bank has also submitted applications to Monetary Authority of
Singapore (MAS) for setting up an Offshore Banking Unit (OBU) at Singapore
and to the China Banking Regulatory Commission (CBRC), China for setting up
a Representative Office at Shanghai. In due course your Bank will seek to
expand its overseas presence.
Foreign Currency Resources
During the year under review, your Bank raised a sum of USD 2,474.02
million equivalent, of which (i) USD 230 million was raised from overseas
banks/overseas branches of Indian Banks/Institutions under the Inter-bank
Dealings scheme of RBI, (ii) USD 465 million by way of club/syndicated
loans, (iii) Renminbi (RMB) 650 million (equivalent to USD 102.31 million)
by way of a Dim Sum Bond issuance under the USD 1.5 billion Medium Term
Note (MTN) programme, (iv) USD 147.60 million by way of short term bond
issuances (private placement) under the USD 1.5 billion Medium Term Note
(MTN) programme, and (v) USD 1,529.11 million by way of short term
borrowings from banks.
As on March 31, 2012, the outstanding amount of borrowings under the Inter-
bank Dealings scheme of RBI (USD 848.82 million) was within the permitted
overall RBI stipulated limit of 50% of Tier I capital. As stated earlier,
your Bank raised Renminbi (RMB) 650 million by way of 3 years Dim Sum Bond
issue in November 2011. The bond was priced at a fixed coupon of 4.5% p.a.
The Dim Sum bond issued by your Bank was the first such issue from India
and other emerging markets, thus providing testimony to the faith reposed
by global fixed income investors in IDBI Bank. Further, your Bank has also
priced a 3 V2 year CHF 110 million 3.125 % Fixed Rate Notes due in October
2015.
Your Bank has updated its USD 1.5 billion MTN programme listed on the
Singapore Stock Exchange in January 2012. Till end of FY 2011-12, your Bank
has raised USD 599.91 million equivalent under the aforesaid MTN Programme.
Credit Rating
Your Bank obtains credit ratings for both domestic and foreign currency
borrowings. The ratings for the rupee resources are as under:
Ratings for Rupee Borrowings
(As on March 31, 2012) (Table 3)
CRISIL ICRA Fitch
Fixed Deposit FAAA / MAA+ Fitch
Stable AAA(Ind)
Short Term Borrowings CRISIL [ICRA] Fitch A1 +
(Certificate of Deposits) A1+ A1+ (Ind)
Long Term Rupee CRISLAA+/ [ICRA] Fitch
Bonds Stable AA+/ AA+(Ind)
(Senior & Lower Tier II Stable
bonds)
Hybrid - Upper Tier II CRISIL AA [ICRA] Fitch AA-
Bonds /Stable AA/ (Ind)
Stable
Hybrid - IPDI CRISIL AA/ [ICRA] -
Stable AA/
Stable
The Foreign Currency borrowings of your Bank are rated by International
Rating Agencies. Moody`s Investor Services (Moody`s) and Standard & Poor`s
(S&P) have rated your Bank on par with the sovereign viz. Baa3 and BBB-/
Negative respectively.
Long Term Rupee Borrowings
During the year, the Bank raised an aggregate amount of Rs. 3,134.40 crore
through bond issuance comprising Lower Tier II bonds (Rs. 2,834.40 crore)
to shore up its CRAR and Senior Bonds (Rs. 300 crore).
Asset Quality
As at end-March 2012, 98.4% of your Bank`s loan assets were standard
assets. As at end-March 2012, sub-standard assets formed 1.1%, while
doubtful assets constituted 0.5% of your Bank`s loan assets, for which
adequate provisions were made in conformity with extant prudential
regulations. Your Bank continues to pursue various recovery efforts to
improve asset quality and also augment bottom line of the Bank. During the
year, your Bank initiated several steps to settle the Non-Performing
Assets/Fully Written-Off (NPA/FWO) cases in its portfolio. Among the
various steps undertaken were restructuring of liabilities, One Time
Settlements/Negotiated Settlements (OTS/NS), legal action, action under the
SARFAESI Act, revovery from distribution of sale proceeds lying at DRT /
OL, change of management, sale of assets to Asset Reconstruction Companies
(ARCs), induction of strategic investors etc., depending on the specific
requirements of each case. The Provision Coverage Ratio (PCR) of your Bank
works out to 68.28% as on March 31, 2012.
Risk Management
Effective management of business risks forms an integral part of your
Bank`s strategy. Risk management philosophy of your Bank is governed by
twin objectives of enhancement of shareholders` value on a sustainable
basis; and judicious usage of capital. In fact, your Bank strives to take
risk culture to next level by spreading risk awareness across the Bank;
making it an integral part of decision making process. Therefore,
identification, assessment, monitoring and mitigation of risks, efficiently
& effectively to yield sustained economic value, continued to receive top
priority.
Your Bank has an integrated risk management architecture that takes care of
various aspects of enterprise-wide risk management. Overall risk management
is the responsibility of the Risk Management Committee (RMC) of the Board
of Directors, though the day-to-day activities are carried out at various
levels. Appropriate organizational structure, policies and review are in
place to ensure effective risk management. A well-established, effective
and independent internal control mechanism exists for supplementing the
risk management systems to build risk consciousness and discipline into
decision-making throughout the Bank.
To strengthen the risk management process in meeting the challenges of an
increasingly complex financial system, your Bank leverages on its complete
branch coverage under Core Banking Solution (CBS) to enhance the Management
Information System (MIS) capabilities. In order to make the Risk Management
System more robust and technologically advanced, your Bank has implemented
Integrated Risk Management Architecture (IRMA), which comprises software
solutions, viz. Risk Assessment Module (RAM), Capital Assessment Model
(CAM) and Comprehensive Operational Risk Evaluator (CORE). RAM is a two-
dimensional web-based rating system, CAM computes regulatory capital
requirements for credit risk and CORE is a system to track operational
risks. These systems would facilitate migration to advanced approaches
under Basel-II in due course.
Implementation of Basel-II Norms
Your Bank has been following Basel-II norms since March 31, 2009, as
stipulated by RBI. In compliance to the Pillar-I norms under Basel-II, your
Bank computes regulatory capital requirement for credit, market &
operational risk. As on March 31, 2012, the Capital to Risk-weighted Assets
Ratio (CRAR) of the Bank works out to 14.58% which is above the minimum
regulatory requirement of 9%. Similarly, Tier-I ratio of the Bank was
8.38%, as against the regulatory requirement of 6%.
Your Bank views the implementation of the Basel-II norms as strategic,
forward looking process to adopt the best practices in risk management with
a focus on creating value. At present your Bank follows the Standardized
Approach for credit risk and is in the process of further upgrading and
strengthening its Credit Risk Management System to be in readiness for
migration to the advanced (Internal Rating Based) approaches of Basel-II.
Similarly for market risk, your Bank uses Standardized Measurement Method
(SMM) to compute regulatory capital and is in the process of implementing
Value at Risk (VaR) based system for smooth migration to Internal Models
Approach (IMA). Your Bank follows Basic Indicator Approach (BIA) to compute
regulatory capital charge for operational risk. As a part of migration
process to Advance Measurement Approach (AMA), a new set of Key Risk
Indictors (KRIs) and Risk & Control Self Assessment (RCSA) framework is
being rolled out across different business segments.
To comply with the Pillar-II norms under Basel-II, your Bank has a Board
approved policy on Internal Capital Adequacy Assessment Process (ICAAP).
This policy enables your Bank to internally assess and quantify those
risks, which are not captured under Pillar-I and also develop appropriate
strategies to manage such risks under normal and stress conditions.
In compliance to Pillar-III norms of Basel-II, your Bank has put in place a
Disclosure Policy and accordingly, the disclosures as on March 31, 2012 are
included in this Report and also are made available on your Bank`s website.
The disclosures pertaining to Capital Adequacy Ratio are also updated on
your Bank`s website on a quarterly basis.
Preparedness for Basel III norms
In order to improve banking sector resilience by strengthening quality of
capital and liquidity regulations, Reserve Bank of India has issued
guidelines based on Basel III norms. Considering the increasing need for
quality capital, your Bank has augmented its common equity capital by way
of preferential allotment of equity to Government of India and Life
Insurance Corporation of India during the fiscal. Management Information
System (MIS) is being further strengthened to meet the data requirement
towards Basel III implementation.
Credit Risk
Recognizing the significance of credit risk in banking business, your Bank
has put in place a comprehensive Credit Risk Management System which
includes web based Risk Assessment Model (RAM) for credit rating of
proposals and automated system for capital computation. To ensure efficient
credit evaluation, credit delivery, portfolio management and monitoring,
your Bank follows a proactive Credit Policy which is prepared taking into
consideration the prevailing business and socio-economic environment to
assimilate the business objectives of your Bank.
The rating committee at the apex level continues to validate credit ratings
and also provides guidance to Risk Analysts and Relationship Managers. As a
proactive measure, your Bank regularly monitors various exposure limits
which include exposure to different countries, segments, sectors and
industries.
Market Risk
Managing market risks effectively, arising out of movement in associated
parameters viz. interest rates, equity prices and foreign exchange rates,
forms an integral part of overall risk management architecture. In this
direction, relevant measures including setting and monitoring of trading
book limits, valuing the portfolio at market rates etc. are carried out
enabling optimal contribution of trading book. In line with your Bank`s
business objectives, portfolio analysis of trading book is also carried out
under various scenarios including stress conditions to optimize the risk
return trade-off.
Market risks are managed in line with the framework defined in Asset-
Liability Management (ALM) Policy, Market Risk Policy, Investment Policy
and Derivative Policy. These policies, in general, outline the appropriate
levels of risk appetite and lay down mechanism for measurement, reporting
and escalation of risks and exceptions, if any.
In order to safeguard your Bank`s exposure to liquidity and interest rate
risk, risk limits have been specified. Asset-Liability Management Committee
(ALCO) regularly monitors risk positions and appropriate steps are taken to
keep the gap positions within the specified level. The ALM position of your
Bank is being periodically reported to ALCO, RMC of the Board and also to
RBI.
As VaR based computation is efficient to measure risk element in trading
book, your Bank is poised to move to VaR based monitoring of the entire
market risk related transactions.
Operational Risk
In order to mitigate operational risk inherent in business activities, your
Bank has put in place an effective operational risk management framework.
Your Bank currently follows the Basic Indicator Approach (BIA), as per RBI
guidelines on Basel II, for calculation of capital charge for operational
risk. However, in order to migrate in Advanced Measurement Approach (AMA),
your Bank has been taking multiple steps for up-gradation of skills,
technology and processes on a continuous basis. The progress report in this
regard is submitted to Operational Risk Group as well as to RMC of the
Board.
In order to estimate capital under AMA based on historical loss data, your
Bank is in the process of capturing operational loss data on various
operational areas as per Basel II defined Business Lines. Further, as a
proactive risk mitigation strategy as well as timely reporting of
operational loss incidents, training programs through class room and e-
learning module have been conducted on operational risk and fraud
monitoring for bank officials working at various functions/ branches.
In the area of Business Continuity, to ensure continued rendering of
critical banking services in the event of business disruption or disaster,
your Bank has a well tested Business Continuity Plan (BCP). This will
enable your Bank to maintain its services available to its valued customers
within shortest possible time in the event of any disruption. Effectiveness
of BCP is assessed through proper testing techniques viz. Notification &
callout test and table-top test/ structured walkthrough tests, prior to
conducting real life testing of BCP. In addition, in order to provide
continued and uninterrupted services even during natural disasters, your
Bank has established a Disaster Recovery (DR) site. Disaster Recovery
drills are conducted periodically in order to ensure smooth availability of
banking services under simulated disaster situations.
Product Risk
Your Bank follows a strong product approval review process comprising of
comprehensive risk evaluation and mitigation system such as concept
validation, confirmation of critical assumptions, technological capability,
etc. Due structure and system are in place which looks into various
dimensions prior to launch of any new product. Information Technology Risk
Being in the forefront in leveraging Information Technology (IT) to extend
better services / products to customers, your Bank recognizes the need for
effective IT risk management. Apart from Information Security, your Bank`s
IT risk mitigation strategy also includes aspects of compliance & privacy.
Information Security Policy (ISP) is in place to ensure that information is
protected from unauthorized access and confidentiality & integrity of the
information are maintained along with timely availability of IT resources
to legitimate users. A high-level Information Security Steering Committee
(ISSC) ensures that systems are in place for continued protection of IT
resources. Apart from conducting regular information security awareness
programs for the employees, various Information Security precautions are
also communicated to Customers.
IT infrastructure and systems have been implemented within a robust
information security framework. The centralized Data Centre of your Bank
has been accredited with ISO 27001, a reputed information security
certification. Measures to enhance the security levels for taking effective
action against `Phishing` attacks are in place. Your Bank is taking
necessary steps to further enhance the safety, security and efficiency in
banking processes, as envisaged in the RBI guidelines on Information
Security, Electronic Banking, Technology Risk Management and Cyber Frauds.
In summary, your Bank has a well structured risk management framework
recognizing various facets of risk and their effective & efficient
management. With continued efforts under the direction of the top
management, the risk awareness in your Bank has percolated down
considerably. The prime objective is to appropriately balance the risk-
return trade-off inherently associated with banking business, through
appropriate mitigation and pricing to maintain competitive edge.
Management, Controls and Systems
HR Initiatives
During 2011-12, your Bank recruited 2670 employees (Officers 1782,
Executives 888) of whom, 529 belong to Scheduled Castes (SCs), 228 belong
to Scheduled Tribes (STs), 893 belong to Other Backward Classes (OBCs) and
90 are Persons With Disabilities (PWDs). As on March 31, 2012, your Bank
had 15,435 employees on its rolls, comprising 1 1,383 Officers, 1608
Executives (On Contract), 1333 Clerical (Class-III) and 1111 Sub-staff
(Class-IV) employees. Your Bank has, as a step towards integrating
synergistic business interests, completed mergers with two of its
subsidiaries viz., IDBI Home Finance Ltd. and IDBI Gilts Ltd. and also
successfully integrated the valuable human capital with the mainstream HR.
As a measure of providing opportunities to officers with outstanding
background to enhance their proficiencies and performance, your Bank has
introduced a scholarship program for overseas study for its officers. Your
Bank has formulated an HR Plan based on the recommendations of Khandelwal
Committee recommendations on HR Issues of PSBs and a Board Level Steering
Committee has been constituted to monitor its implementation.
Your Bank is in the process of implementing the New Pension Scheme of
PFRDA, a Defined Contribution Pension Scheme for new recruits on the rolls
of the Bank who have joined after April 1, 2008. The industrial relations
climate in your Bank has been largely cordial during the year with no major
disruption in work and most of the issues have been amicably resolved.
Representation of Scheduled Castes (SCs), Scheduled Tribes (STs) and Other
Backward Classes (OBCs)
Your Bank has been implementing the Rules of Reservation for SCs/ STs with
effect from April 1977 in direct recruitment and from February 1980 in
promotion. Your Bank has also been implementing reservation for Other
Backward Classes (OBCs) with effect from September 1993 in direct
recruitment. In terms of revised "Brochure on Reservation for Scheduled
Castes (SCs), Scheduled Tribes (STs) & Other Backward Classes (OBCs) in
services" issued by the Government of India, Reservation Registers have
been duly adopted. The representation of SCs, STs and OBCs in the total
strength of your Bank in various cadres as on March 31, 2012 is presented
in the Table 4 given below.
Table 4 : Representation of SCs/STs/OBCs (Table 4)
Manpower Total Out of which
Strength
SCs STs OBCs
Officers 11,383 1336 477 1817
Executives 1608 274 48 542
Clerical 1333 142 40 121
Sub-staff 870 210 64 145
(excluding Sweepers)
Sweepers 241 60 18 46
Total 15,435 2022 647 2671
% of Total Strength 13.10 4.19 17.30
SC/ST/OBC count -Excluding employees of IDBI Home Finance Ltd. and IDBI
Gilts Ltd.
There were 45 Ex-Servicemen and 203 Persons With Disabilities (PWDs) in the
Bank as on March 31, 2012. Your Bank maintains separate Rosters for PWDs,
as per Government of India guidelines. Your Bank has appointed Liaison
Officers for SCs/ STs/ PWDs and OBCs to effectively redress the grievances
of SC/ ST/ OBC employees of the Bank.
Human Resources - Training & Development
In the past year, your Bank has taken various training initiatives towards
the professional and personal development of the employees of your Bank, to
enable them to meet organisational goals. Employees equipped with the right
competencies have led to your Bank`s growth. During the year, your Bank
trained 11,252 employees, through 460 in-house training programmes. In
addition, 483 officers were nominated for external training programmes
conducted by other institutes/ training organizations of repute in India
and 62 officers were nominated for programmes/ conferences/ seminars
abroad. Your Bank has been fully utilizing its existing training facilities
at Jawaharlal Nehru Institute of Banking and Finance at Hyderabad, and the
four Regional Training Centers at Mumbai, Chennai, Kolkata and New Delhi. A
series of Leadership Excellence programme were conducted at JNIBF,
Hyderabad for senior officers. As a Corporate Social Responsibility
initiative, your Bank also organised a seminar on "Institutionalizing
Responsible Corporate Citizenship for Banks and Financial Institutions in
India" in collaboration with Association of Development
Financing Institutions in Asia and the Pacific (ADFIAP) and the Washington
based Center for International Private Enterprise (CIPE) which was attended
by representatives from other Public and private sector Banks/financial
institutions.
Your Bank extends technology not just to banking processes but also to
learning initiatives through the online training portal i.e. i-varsity & i-
blogger that keeps your Bank`s staff updated on the products, processes &
helps them deliver to the needs of the customers. Skill upgradation and
learning was on a continuous basis via online tutorials and certifications
were awarded after completion of certain online tests.
Your Bank`s apex training institution, Jawaharlal Nehru Institute of
Banking and Finance in its role as `Centre of Excellence` has organised
several programs not just to groom your Bank`s staff, but has also shared
its expertise with other banks and financial institutions on commercial
basis, thus generating profit for your Bank.
Internal Audit
Your Bank has a well-equipped Internal Audit Department carrying out
regular independent appraisal of all activities undertaken by different
business verticals / support verticals and branches. The function is headed
by Senior Management Personnel with reporting lines to Chairman and
Managing Director (CMD) and Audit Committee of the Board. The audit
function maintains its independence and objectivity while carrying out the
assignments.
Your Bank has adopted risk-based internal audit as its strategy, while
carrying out the activities. Further effectiveness of the Internal Audit
functions have been enhanced by way of implementing the web based Audit
Management System, off site monitoring, opening of Audit Hubs at important
centres, systematic selection of audit samples to ensure wider & meaningful
coverage of the audit through, well defined audit formats.
Your Bank has an experienced in-house Information System Audit (IS Audit)
team in place, as a part of Internal Audit mechanism, to address technology
and IT security issues commensurate with the nature and complexities of the
operations.
Your Bank has, in line with the regulatory requirements, put in place a
comprehensive concurrent audit system to supplement the internal audit
function to strengthen internal controls.
In order to achieve continuous improvement in the quality of Credit
portfolio of your Bank, the Credit Audit System has been put in place
during the year, which aims at critical in-depth examination of individual
large commercial loans.
Credit Audit mechanism has been aligned with Risk based Internal Audit,
which enable to assess whether the Bank`s laid down policies in the area of
credit appraisal, sanction of loans and credit administration are
meticulously complied with. Credit Audit also facilitates early
identification of warning signals and suggests prompt remedial measures, to
aim at overall improvement of portfolio quality.
Your Bank evaluates, on a continuous basis, the adequacy and effectiveness
of internal control mechanism, adherence to policies & procedures and
suggests measures to strengthen and streamline control for addressing
various risks timely. Keeping this in mind your bank reviews Risk Based
Internal Audit Policy, Concurrent Audit Policy and Information Security
Audit Policy on an annual basis.
Fraud Management System
Your Bank has put in place fraud monitoring mechanism through a dedicated
group i.e. Fraud Monitoring Group (FMG) under Internal Audit Department.
The Fraud Review Councils (FRC) have been constituted to monitor and review
all frauds so as to identify systemic lacunae, if any, initiate corrective
measures, monitor progress of investigation and recovery position. The FMG
also reviews efficacy of the remedial action taken to prevent recurrence of
frauds, such as strengthening of internal controls and putting in place
need based remedial measures. A detailed Fraud Risk Management Policy has
been put in place for effective fraud control.
There exists proper co-ordination between Audit, Operation Risk and other
operational wings for enhancing operational efficiency and fine-tuning of
the processes. Emphasis is placed on benchmarking your Bank`s practices and
procedures in an endeavour to migrate to the best practices in the
industry. The Audit Committee of the Board and Audit Committee of
Executives review the performance on continuous basis, give directions to
the internal audit functionaries and review effectiveness of internal
control systems, as also compliance with regulatory guidelines.
Vigilance Mechanism
A full-fledged Vigilance Department located at your Bank`s Head Office,
operates as a channel for providing inputs to the Top Management for
carrying out investigation into vigilance related complaints and to suggest
corrective measures for improving deficiencies, if any, in the control
systems and laid down procedures. Your Bank has been implementing the
guidelines laid down by the Central Vigilance Commission (CVC) for
improving Vigilance Administration and has put in place a system wherein
complaints received from the public/any other sources are attended to
promptly.
A Vigilance Department Site is operational on the Intranet of your Bank,
which provides an overview of the Vigilance Department, Format of Standard
Notice of CVC to be displayed at all Branches/Offices of your Bank,
Important Circulars/Guidelines issued from time to time by CVC, Chief
Technical Examiner`s Organization (CTEO) of CVC, as also by your Bank and
Do`s & Don`ts of Preventive Vigilance. This has helped your Bank in
enhancing the level of Vigilance awareness among officers.
During the year, surprise vigilance visits were made to various branches to
detect malpractice, if any, and non-adherence to laid down systems and
procedures and suitable corrective measures were suggested, wherever deemed
necessary.
With a view to spreading Vigilance Awareness among employees of your Bank,
numerous interactive Workshops and Talks/Presentations on Vigilance
Awareness with focus on Preventive Vigilance were organised during the
year. During the aforesaid events, due emphasis was laid on the need for
Preventive Vigilance to be exercised by all the staff members in their day-
to-day work as also how Vigilance Awareness helps in achieving the larger
goal of organizational efficiency.
Vigilance Awareness Week was observed during October 31, 2011 to November
05, 2011, at the Head Office and Branch Offices of your Bank to sensitise
the employees about the evils of Corruption. On this occasion, the Chairman
& Managing Director of your Bank, released a Special Journal for the
benefit of staff members of your Bank, which incidentally won Bronze Award
for the best Tabloid Newsletter awarded by the Public Relations Council of
India.
Regulatory Compliance
Your Bank has taken adequate steps to ensure compliance with various
Statutory & Regulatory stipulations and guidelines. During the year, a
dedicated Compliance Department was set up to oversee the compliance
related activities. Your Bank has also designated a Chief General Manager
as Chief Compliance Officer. The Compliance Department is responsible for
overseeing the observance of:
1. Statutory provisions (Banking Regulations Act, RBI Act, FEMA, Prevention
of Money Laundering Act, etc.)
2. Regulatory guidelines (RBI, IRDA, SEBI, etc.)
3. Standards & Practices prescribed (BCSBI, IBA, FEDAI, FIMMDA, etc.) and
4. Bank`s internal policies.
The Department also transmits information regarding statutory and
regulatory requirements across the organization to facilitate better
compliance.
Code of Bank`s Commitments to Customers
Your Bank is a member of Banking Codes & Standards Board of India (BCSBI),
set up by Reserve Bank of India. The Board of Directors of your Bank
adopted the Code of Bank`s Commitment to Customers (Code 2009) and also
Code of Bank`s Commitment to Micro and Small Enterprises (MSE Code). Both
the codes are voluntary and sets minimum standards of Banking practices for
Banks to follow, when they are dealing with individual customers and also
with micro and small enterprises.
As an integral part of your Bank`s compliance with the above codes,
information on the codes is provided to customers through display on your
Bank`s website, at the branches, customer statements of accounts etc.
With a view to making the Grievance Redressal Mechanism more effective, the
Regional Heads of your Bank, pan India, have been designated as Code
Compliance Officer (CoCO) and their contact details are prominently
displayed at branches and on the Bank`s website.
Your Bank has in place Customer Service Committee of the Board (CSCB) and
Standing Committee on Customer Service (SCCS) to ensure that Bank`s
products, processes and services are periodically fine tuned to meet the
desired objective of BCSBI of achieving customer satisfaction.
Customer Service and Complaint Management
Your Bank has recently adopted new Vision and Mission statements to act as
guiding principle for all activities in future. The first Mission of the
Bank is to delight the customers with excellent service and comprehensive
suite of best-in-class financial solutions. Your Bank has indeed imbibed
this Mission as part of its philosophy. Your Bank is a service-oriented
organization and realizes the fact that its success depends on the quality
of service offered to customers and therefore Customer Service takes the
centre-stage in the Bank. Your Bank, on a continuous basis, takes
initiatives to ensure that the customers have best-in-class banking
experience at each of the touch-points where the customer approaches the
Bank.
Your Bank has a Customer Service Committee of the Board and a Standing
Committee on Customer Service (chaired by the DMD and comprising of senior
officials as its members) to look into various aspects of Customer Service
and Complaints Management. The involvement of Independent Directors and Top
Management in matters of Customer Service and Complaints Management ensures
that these important areas get the attention they deserve.
Your Bank has set up a Centralized and dedicated Customer Care Centre (CCC)
to take care of the activities which would bring about an improvement in
Customer Service. It includes receiving and redressing customer complaints
escalated upwards from the branches and inbound Call Center and those that
are received through the centralised E-Mail unit, Website, letters at
Corporate Office and through Social Media. CCC also handles the complaints
received through RBI, Banking Ombudsman, Government of India and other
regulatory authorities.
The objective of CCC is to ensure that all customer complaints are resolved
quickly and are recorded and tracked centrally till resolution. CCC also
analyses the nature of complaints received and gives feedback to the
concerned department/ branch for their necessary action. Your Bank has in
place a Board-approved Grievance Redressal Policy, which sets the
timeframes for resolution of complaints at the branch level and on
escalation at the CCC level. CCC takes utmost care to ensure that customer
complaints are attended to and resolved in a time bound manner, as per the
timeframes set in the Grievance Redressal Policy. As a result of your
Bank`s commitment to quality and turn-around-times, in the course of the
current financial year, your Bank was awarded the coveted international
certification ISO 9001:2008 for its Customer Care Centre.
Your Bank appreciates the fact that operational systems and processes must
be continually improved by taking into account the feedbacks given by the
esteemed customers. A customer is invited during the meetings of Standing
Committee on Customer Service, who shares his concerns with your Bank, as
well as gives his suggestions on how your Bank can provide improved service
to its customers. Your Bank also has Branch Level Customer Service
Committees (BLCSC) at all its branches. The BLCSCs, which comprise of
customers as its members, meet once every month, in order to discuss
issues, which can help in bringing about an improvement in Customer
Service. In the current Financial Year, your Bank organised Customer Meets,
titled as "Grahak Sahyata Abhiyaan" in Pune and Kochi, wherein senior
officials of the Bank directly interacted with customers, and sought their
suggestions/views to improve Bank`s products/services. Your Bank has also
conducted a Customer Satisfaction Survey across multiple locations, wherein
valuable insights were obtained from our esteemed customers on our service
standards. The survey also helped your Bank to benchmark the service
standards against its peers. Going forward, the survey would be an annual
exercise to be conducted across different regions of the country. Your
Bank, in order to monitor the customer satisfaction on an ongoing basis,
has hosted a Feedback Form on its Website to enable customers to rate the
Bank and also provide suggestions for improvement. Your Bank has also
developed internal Customer Suggestions software and has also put in place
a process to examine suggestions that are being received from customers at
the Bank`s contact points. Your Bank implements all such suggestions,
including those received from BLCSC that are found feasible and desirable
as per the Bank`s extant policy.
As a part of your Bank`s Foundation Day celebrations during October 2011,
meetings were held at Mumbai, Delhi, Hyderabad, Bangalore and Guwahati
wherein the Banking Ombudsman of these locations were invited to interact
with customers and staff members and address them on Complaints Management
and Customer Service. Senior officials from your Bank were present for the
meets. During the meets, the Banking Ombudsman from their locations
discussed the Banking Ombudsman Scheme and made the customers aware of
their rights. Subsequently, your Bank has sent e-mails to the esteemed
customers describing the different aspects of the Banking Ombudsman scheme.
Your Bank observed `Customer Contact Week` (CCW) during December 12-17,
2011. The basic purpose of the programme, which was held pan-India, was to
improve customer service by identifying the areas of improvement,
understand the grievances of customers and staff and bring about an over-
all improvement in the upkeepment of the branches. Some of the activities
conducted during the Week were display of attractive banners informing the
customers about the CCW, accepting suggestions from the customers for
improvement, display of activities on our Face book page and other Social
Media like Twitter and Google+. Emails were sent to customers during the
entire week informing them about various rights that can be exercised by
them and several do`s and don`ts which included information pertaining to
phishing, precautions regarding usage of their accounts, debit cards, PINs,
etc.
Going forward, your Bank will continually improve the systems and processes
to achieve customer delight through provision of best-in-class customer
service. This will be done through review and monitoring done internally,
by analysing the best market practices, as also through feedbacks received
from the customers through multiple channels. Your Bank has already
implemented the "Complaints Resolution Module" in the Phone-banking Unit,
which will help in faster escalation of complaints and reduction in the
resolution time thereof, thereby improving the efficiency of working and
enhanced customer satisfaction. As a next step, the implementation of this
Module will be done in the branches and the Processing Units in a phased
manner. Moreover, your Bank is in the process of implementing the
recommendations of the Damodaran Committee on Customer Service as per the
guidance of RBI and IBA.
Right to Information Act
The Right to Information Act (RTI Act), 2005 was enacted with a view to
promoting transparency and accountability in the working of various public
authorities. Your Bank has put in place a robust mechanism to respond to
applications from citizens seeking information under the RTI Act on various
aspects of the Bank`s functioning. The Bank has designated 25 Central
Public Information Officers (CPIOs) to respond to applications on various
functional areas. In addition, all the Branch Heads have been designated as
Central Assistant Public Information Officers (CAPIOs) to receive and
forward applications received under the RTI Act to designated CPIOs. The
Bank has designated a Senior Officer as Appellate Authority for dealing
with appeals of aggrieved applicants. Further, in terms of CIC Directive
dated November 15, 2010 and notification dated December 09, 2010, the Bank
has designated an Executive Director as the Transparency Officer for the
promotion of Institutional Transparency and effective implementation of
Section 4 of the RTI Act. Training is being provided to the CPIOs on
various aspects of the RTI Act on regular basis. Further, to sensitize the
officers of the Bank about the importance of the RTI Act, a specific module
on the RTI Act is being included as part of all training programmes being
conducted by the Bank at the JNIBF, Hyderabad and at various Regional
Training Institutes of the Bank. A separate menu on the RTI Act has been
provided on the Bank`s website (www.idbi.com) capturing all information
relevant to the Bank`s functioning. During FY 2011-12, the Bank received
807 applications seeking information under the RTI Act. Bulk of the
applications pertained to the retail banking operations of the Bank. All
applications have been responded to as per the provisions of the RTI Act.
Progressive Use of Hindi
Your Bank continued to promote the use of Official Language Hindi as per
Government directives. Your Bank continued its endeavour to ensure
compliance of various provisions of Official Language Act, 1963 and Rules
framed therein. Special efforts were made to achieve the targets regarding
use of Hindi by departments at Head Office and branches of the Bank. The
increased use of Hindi in both print and electronic media enabled your Bank
to reach wider section of people. In order to facilitate customers, ATMs of
your Bank provide the display of instructions both in Hindi and English. On
Bank`s website, information is made available in Hindi also. During the
period under review, concerted efforts were made to increase the use of
Hindi in the technology-enabled environment. A font converter software
namely `Script Magic` has been installed in all branches of your Bank
located in Region `A` for printing of Pass Book, DD, Pay Order, Accounts
Statements, etc. in Hindi, as and when required by customers. In order to
create awareness among staff members and familiarize them with the
provisions of Official Language Policy and Annual Programme issued by Govt.
of India, Rajbhasha Awareness Programmes were organized at various centers
pan India and also Hindi software training was imparted to the staff
members.
As a part of Hindi Day celebration, various Hindi competitions were
organized at all India level and also at Head Office. A Lecture was
organized on `Aahar Vigyan Evam Swasthya` for the benefit of staff members
at Head Office. In commemoration of 150th birth anniversary of Gurudeo
Rabindranath Tagore, 4 plays based on his famous short stories were also
staged during Hindi Day celebration and a special poster based on his
famous quotes in Hindi was also brought out during Hindi week. During the
year posters/ fliers/ leaflets on the Bank`s schemes were printed in Hindi.
Your Bank also reprinted the revised version of Hindi desk calendar
`Suvichar Sangrah` for the benefit of staff members, which comprises 366
inspiring quotations based on positive thinking, work culture & commitment
towards duty. An Official Language officers conference was also organized
on `Changing role of language in changing environment` during the year.
The Third Sub-committee of Parliamentary Committee of Official Language
visited Gangtok and Karol Baugh, New Delhi branches to inspect progress of
Hindi in official work. In addition, the Drafting and Evidence Sub-
committee of Parliamentary Committee of Official Language also visited
Jaipur and had discussions with the in-charge of your Bank`s Jaipur branch.
The Committee commended the efforts made by these branches in implementing
the Official Language Policy.
Your Bank`s efforts in increasing the use of Hindi in its day-to-day work
and other areas of communication have been recognized at various levels.
Your Bank`s New Delhi, Jaipur, Jammu Branches and Specialised Corporate
Branch, Bhopal received award from respective Town Official Language
Implementation Committees for excellent performance in use of Hindi. Your
Bank`s quarterly Hindi Magazine `Vikas Prabha` was awarded Shield under the
`Reserve Bank Hindi House Journal Competition`, which was received by our
Chairman Shri R.M. Malla and presented by Honorable Governor of Reserve
Bank of India. `Vikas Prabha` was also felicitated by other well known
literary and cultural organizations, such as Public Relations Council of
India (PRCI), Ashirvaad Sanstha and Rajbhasha Kiran Sansthan during the
period under review.
Corporate Communications
Corporate communication strategically communicates the corporate culture,
identity and the philosophy of your Bank to all its stakeholders.
Information about your Bank is developed and communicated directly with key
audiences through different mediums like advertising, public relations,
social media, internal communication etc. Your bank is constantly striving
to improve and build its reputation through internal and external marketing
campaigns and activities. Apart from this, market research is also
conducted periodically to continuously evaluate communication tools, and
use the results of evaluation to inform improvements.
The advertising and publicity activities undertaken by your Bank during the
year was commensurate with its business philosophy of providing `banking
for all`. The advertisement & publicity initiatives for the year under
review continued its focus on the last year`s brand proposition, which
emphasised your Bank`s deep relationships with its customers. Accordingly,
this was communicated through innovative and intensive campaigns in
different mediums of communication viz. TV, Print, Radio, Outdoors and
Online.
Keeping in view the demographic profile of the emerging customer base, as
also in its endeavour to appreciate and adopt innovative technological
solutions to reach the customers, your Bank has put considerable emphasis
on the digital media. During the year, your Bank officially launched its
presence on various social media platforms such as Facebook, Twitter,
YouTube and Google+ and through continuous effort strengthened its presence
across these platforms. Your Bank was the first Bank in the country to
cross a fan base of 5,00,000 on Facebook and its fan base on Facebook at
the end of the year under review was the highest among Banks in India at
more than 6,25,000. Your Bank was also the first Bank in the country to
have its own official brand page on Google+. As on date, more than 15,000
people on Google+ have IDBI Bank in their circles and are updated through
Google+ posts. Your Bank is also the first Bank in the country to have
15,000 followers on Twitter. Your Bank also launched its YouTube Brand
Channel where it has more than 7,000 subscribers which is the highest
amongst Banks in India. Your Bank carried out many more innovative
activities in the Digital space such as an i-phone based campaign for NRIs
in the United States and an Android phone based campaign for the customers
in the Gulf. Your Bank also developed Quick Response codes which have
become popular due to its fast readability and comparatively large storage
capacity.
Your Bank announced the roll out of its Mobile Banking Facility to
facilitate the usage of modern banking to millions of people across the
country. A bus had been converted into a mobile ATM Branch for this purpose
and commenced its "Vikas Yatra`` from IDBI Tower, Mumbai, to promote
developmental activities in the country. The bus traversed from Mumbai to
Jangipur in West Bengal having major halts at Nagpur and Raipur. The Mobile
Van was inaugurated in Jangipur, West Bengal by Shri Pranab Mukherjee,
Hon`ble Union Finance Minister, for the socioeconomic development of the
area. To encourage the Indian Team for its World Cup final match, an
activity was organized in Mumbai, which involved obtaining signatures on a
huge Cricket Bat and forming human chains on the road approaching the
stadium to build a personal connect with people. The `Magic Card`, which is
the first ever Debit card with a credit limit for salaried individuals, was
launched at a unique magical show hosted at Kolkata. A campaign for the
said product was undertaken in major financial papers in print and outdoor
media. The `Being Me` youth account was introduced on International Youth
Day to target the youth. `Sawaal India Ka`, a 13 week quiz show on a major
Hindi news Channel, was undertaken to engage the youth in an interactive
platform, thus leading them to open their first savings account with your
Bank.
Select product advertisements were released by different verticals catering
to niche customer segments. An in-film integration focusing on select
Personal Banking products like International Debit cum ATM card, Gift card
and 24*7 lockers has been incorporated in a regional commercial film which
would be released shortly.
As in the advertising arena, several initiatives were undertaken by your
Bank in the Public Relations (PR) domain. Public Relations activities of
your Bank focused on disseminating news on the customer centric initiatives
of the Bank. Your Bank, as a conscious policy, to be more visible in the
media space, has facilitated interaction of top management with the media
and also has been holding regular press conferences in different parts of
the country. These were well-attended by the media and your Bank received
extensive coverage across the country in both print and electronic media.
Good coverage was also received on other communications of your Bank,
including specific product related information as also news related to
events and achievements of your Bank. Leading publications and TV channels
carried regularly news of your Bank`s business decisions such as change in
interest rates.
Your Bank also focused on communicating effectively with its internal
stakeholders i.e. the employees. A blog was launched on the corporate
intranet of your Bank to enable the Chairman and Managing Director (CMD) to
initiate a two way communication with the employees. The main aim is to
communicate directly to each employee and take feedback from them, so that
they act as ambassadors for your Bank.
Various communications of your Bank won accolades and bagged many awards
and recognitions. Your Bank won a total of 8 Awards at the coveted Public
Relations Council of India (PRCI) Annual Corporate Collateral Awards 2012.
Your Bank has also been featured among the `Super Brand` and `Power Brand`
listings, as also among the top 50 Brands in the country as ranked by the
Economic Times in association with Brand Finance, UK. Your Bank has also
been ranked as one of the top 500 Banks in the world by Brand Finance (A
leading global organisation conducting brand valuations since 1996).
Awards and Accolades during FY 2011-12
During the period under review, your Bank received various awards. Your
Bank was awarded the ISO 9001: 2008 Certification for its Customer Care
Centre and for its In-House Journal, September 20, 2011. Your Bank received
"CNBC TV18 Special Jury Award" and was also winner of the Dun & Bradstreet
Banking Awards 2011 for Best Bank & Best Public Sector Bank, September
2011. Your Bank was adjudged Best Bank of the Year in the 3rd Dalal Street
Investment Journal (DSIJ) PSU Awards, May 2011. Your Bank won Asian Banker
Technology Implementation Award 2011 for Best Data and Analytics Project,
April 2011. All Centralized Clearing Units [CCU] of your Bank got ISO 9001:
2008 Certification, April 2012. Your Bank bagged IBA`s prestigious Banking
Technology Awards, March 2011.
Shree Vayam
"Shree Vayam" the prestigious bilingual (Hindi-English) House Journal of
your Bank is now in its 27th year of publication. Vayam continues to
generate unalloyed delight among your employees and family members. Your
House Journal has attained a pre-eminent position in the Corporate World
carving out a niche for itself. One more feather was added during the
financial year with the Shree
Vayam Section obtaining ISO 9001:2008 Certification. Perhaps the only House
Journal Section in the country to do so. During the FY 2011-12, the House
Journal kept up its winning streak in all India House Journal Contests by
winning two bronze medals for internal Magazine and Special Features Column
in English in the contest conducted by the Association for Business
Communicators of India (ABCI) and certificate of Merit in the ICE contest
conducted by FEI Cargo, Mumbai.
Corporate Social Responsibility Initiatives
Corporate Social Responsibility (CSR) is a commitment of businesses to
contribute to sustainable economic development by working with the local
community to improve their lives, benefiting the business as well as the
community at large. Your Bank has consistently gone beyond the immediate
business objectives and has taken various initiatives to contribute for the
betterment of society.
Your Bank has been conducting programs on Financial Inclusion, Agri
awareness camps in rural areas to benefit farming communities, providing
financial support to Charitable Organisations, NGOs, Hospitals, organising
blood donation camps at Corporate Centre as also branches across India, on
important occasions such as Foundation Day. To provide focussed attention,
your Bank is putting in place a Board approved comprehensive policy on CSR
initiatives in key focus areas such as Education, Health, Community
Welfare, Environment, Rural Infrastructure, Social Empowerment, etc.
Facilities and Infrastructure
During the FY 2011-12, your Bank completed construction and furnishing of
Currency Chest at Bandra Kurla Complex (BKC), Mumbai and 50 twin-sharing
hostel rooms at its training institute, viz. JNIBF, Hyderabad. Your Bank
also completed furnishing of a Premier Locker Facility at IDBI Tower,
Mumbai, 150 new branches, Retail Asset Centres (RACs), Retail Processing
Units (RPUs) and 21 relocated branches. The Bank also renovated existing 21
branches during the year.
Information Technology
Your Bank is one of the leading banks in the country leveraging the usage
of technology to extend customer centric products and has been operating on
state-of-the-art platforms. This has helped your Bank in achieving
operational excellence and staying ahead of its competitors through
innovation in product and service offerings. The highly effective
management of IT infrastructure, product and process innovation, back
office operations and highly technology enabled National Contact Centre
Services of your Bank have ensured that technology continued to remain
backbone of the Bank`s services and internal operations. All the IT and IT
enabled activities are being professionally managed by IDBI Intech Ltd., a
wholly owned subsidiary of your Bank.
Your Bank has been taking initiatives for improving customer service,
launching of new customer focused products and services thereby achieving
significant growth in business. Various innovative products backed by
technological support have been launched during the year. Besides, your
Bank has also been strengthening the security features on the technology
usage for both internal as well as external customers.
Your Bank has been facilitating payment of various taxes to the customers
through the Net Banking facility, wherein customers can pay central
government and state government taxes online by using the facility. This
facility has been well received by customers and it is found that the
volume, as well as amount of transactions has increased many fold over the
past year.
For greater convenience of customers availing Housing Loans and Educational
Loan, your Bank has launched an online portal wherein customers can login
with their credentials and generate their own Final Certificates,
Provisional Certificates and also statements that are required for their
tax calculation purposes. Your Bank has put up web based application to
enable prospective SME Borrowers to apply for financial assistance on-line
and track the status of their applications too.
Your Bank has taken a step towards the Green Initiatives in Corporate
Governance by going paperless and sending documents to shareholders through
electronic mode. Your Bank has sent documents like General Meeting
Notices/other notices, Annual Report, etc. to shareholders in electronic
form. As part of green initiatives, many applications have been implemented
to automate the internal processes and reduce the usage of paper.
Your Bank also automated various back office processes of the Bank for
improving the overall operational efficiency, thereby reducing the
turnaround time for customers. Various back office processes have been
centralized, thereby allowing branch staff to cater to customers with
greater focus. Your Bank has introduced the concept of training at the
desktop through its e-learning platform for the staff members thereby
improving their operational knowledge leading to better customer service.
Your Bank has also adopted the national spirit of implementation of Hindi
Language and has taken steps in the area of providing bilingual software,
statements of accounts, passbooks, letters, etc. to the customers. Even the
Core Banking Software used by your Bank has been converted to bilingual
format.
Your Bank has also added many new features for sending SMS alerts to
customers. SMS alerts are being sent for all channel transactions,
transactions under RTGS, ATM reversal transactions, weekly alert of
balances, other alerts such as stop payment of cheque, etc. Such alert
facility has been automated without any manual intervention.
Your Bank has always taken initiatives to redress customer complaints
quickly. Your Bank has launched complaints through SMS facility wherein a
customer just needs to type "IDBICARE" and the customer receives a call
from the customer care to address his/her grievances.
Your Bank is in the continuous process of upgradation of the hardware and
networking equipments at Data Center and Disaster Recovery site, so as to
give continued performance improvement of systems to customers. The Bank
has upgraded hardware of various core systems to increase the efficiency of
processing large number of transactions.
Your Bank has implemented best practices of Information Security by
implementing ISO 27001 framework and certification has been renewed for the
current year also. For ensuring uninterrupted services to the customers,
your Bank is carrying out planned Disaster Recovery (DR) exercises at
regular intervals. As a part of this drill, the Core Banking and other
critical applications including Alternate Channels like ATM, Internet,
Mobile and Phone Banking are successfully operated from the disaster
recovery site. This is one more initiative of your Bank in ensuring
continuous and uninterrupted services.
Your Bank continues to educate its customers about online fraud, phishing
etc. through media, by sending e-mails and by sending SMS`s on periodic
basis. The National Contact Centre of the Bank is well-equipped to resolve
queries from customers by educating them. Your Bank is also continuously
monitoring the TAT for the queries raised by customers through the service
desk and taking initiatives for early resolution of customer problems.
All the above initiatives portray your Bank`s endeavor to be the front-
runner using technology for launching innovative products for the benefit
of its customers. Your Bank`s Internet Website has been judged as "Best
Website" by Association of Development Financing Institutions in Asia & the
Pacific (ADFIAP) Awards 2012 in Istanbul, Turkey. |