MANAGEMENT DISCUSSION & ANALYSIS

a. Industry Structure & Developments:

The Indian banking sector has come a long way since independence and now comprises Commercial banks (Public Sector Banks, Private Sector, Foreign Banks), Co-operative Banks and Developed Banks. In addition to this, RBI licensed two Private Sectors banks, 10 Small Banks and 11 Payments Banks in FY’16 which added to the existing number of players in the Indian banking system. Despite challenges of poor asset quality, subdued credit growth and weak profits Public Sector Banks in India still remain the back bone of the Indian financial system.

The subdued growth witnessed in infrastructure, metal and industrial sector has been persistently posing challenges to the Indian banking sector. Demand for credit has been subdued and so also the deposit growth except for the year end spurt. Stressed assets (non-performing loans plus standard restructured assets) have been rising on the back of economic slowdown, impinging on capital positions of banks.

Although slow business growth has been an issue with PSBs for quite sometime, high level of stressed assets constraining profitability and weak capital positions remain the dominant concerns. The banks have taken resort to various measures announced by the Reserve Bank of India (RBI) like Strategic

Debt Restructuring (SDR) & Flexible Debt Structuring to relieve the asset quality challenge. In this context the Ujwal DISCOM Assurance Yojana (UDAY) scheme to convert 75% of the debts of Power Discoms into equity is a relief to the Public Sector Banks (PSBs).

The asset quality issues together with the balance sheet cleansing exercise under the Asset Quality Review (AQR) has led to spike in provisioning for most of the PSBs in Q3 and Q4 of FY’16. High level of impaired assets together with weak capital positions have undermined the overall credit profile of India’s Banking system. Some banks managed to access market to raise capital at opportune times despite weak market capitalization. Infusion of capital to the extent of Rs.70,000 crore (over three years till March 2019) by the Government as per the recapitalization plan under Indradhanush is an indication to the banks about quantum of capital they need to arrange themselves.

As a relief though RBI has allowed banks to include fixed asset revaluation, treatment of deferred tax assets and foreign exchange reserve revaluation in the Tier I capital with suitable hair cut. This has helped the banks to strengthen their Tier I capital position.

The banks are implementing reform measures suggested in GyanSangam, being organized by Ministry of Finance for the last two years. The measures suggested by GyanSangam are holistic and multifaceted that would enhance the efficiency and operational flexibility of the PSBs.

For better transmission of monetary policy rates, RBI introduced new benchmark lending rate called Marginal Cost of Funds Based Lending Rate (MCLR) effective from 01.04.2016. Another landmark development in the last fi nancial year was setting up of Bank Boards Bureau (BBB) which will appoint Board members and devise strategies for enhancing effi ciency of the PSBs.

b. Opportunities and Threats

The banks are the lifeline of the economy and play a catalytic role in activating and sustaining economic growth, especially, in developing countries like India. Despite problems and challenges posed by weak economic activity and muted credit demand, emerging opportunities for banking services from young population continue to provide a silver lining. Apart from that the Government’s developmental initiatives such as Make in India, Startup India-Standup India, Skill India, Housing for all by 2022, etc are set to create opportunities for the banks.

The accounts opened under Pradhan Mantri Jan Dhan Yojana (PMJDY) may emerge as potential small business opportunities for the banks. If the Government rolls out direct benefi t transfer (DBT) scheme for all the services, then the accounts opened under PMJDY will further contribute to the saving deposits of the banks.

Further, the recently licenced Payments banks may emerge as business opportunity for the Banks. The banks may enter into tie ups with Fintech companies that have got licence for Payments bank to garner business in the remote areas. However, the banks may face threats from various other sources. Excess capacity in many sectors, together with the increase in leverage on corporate balance sheets impede their ability to absorb credit which is one of the important threats to the Indian banking system especially to the PSBs.

Another challenge which has constrained credit delivery is the brvalence of the stressed assets in banks’ credit portfolios. However, the situation is set to improve. Restricting incremental non-performing assets through early detection, monitoring, corrective action plans, shared information and disclosures is also likely to keep a future recurrence in check. Proposed mechanisms for asset resolution, including the Bankruptcy Code, will help speedier recovery.

Further, in an environment where delivery of fi nancial services will become increasingly commoditized, customer experience will be the differentiating norm for a brferred service provider. The ability to tailor fi nancial solutions to customers across multiple platforms will unleash a wave of product innovations and thereby demand for fi nancial services.

Similarly, though Payments banks may act as business facilitators for Universal banks, the Small banks and new Private sector banks may emerge as potential competitors.

c. Segment-wise or Product wise performance

The Bank’s business broadly comes from deposits, credit and investment. Some major business segments like Resource mobilization, Priority Sector lending, Retail Lending, Financial inclusion, MSME, etc are analysed in this section.

i. Resource Mobilization

The Bank’s total deposits amounted to Rs..5,53,051 crore as at the end of March’16, showing an absolute accretion of Rs..51,672 crore and a growth of 10.3% over brvious year. The share of CASA Deposits in total domestic deposits increased to 41.63% in FY’16 from 40.57% in FY’15

A unique saving product, named “PNB POWER SAVINGS” exclusive for women had been launched on the occasion of International’s Women’s Day i.e. 08.03.2016, with various attractive Concessions/Freebies including free accidental death Insurance cover to the extent of Rs..2 lac & Rs..5 lac. As on 31st March’16, 78,861 accounts with Rs..89.26 crore was mobilized.

The Bank, in order to attract young generation tech-savvy customers and to simplify the account opening procedure, undertook initiatives for online submission of Account Opening Form (AOF) for Saving Fund Account through corporate website (www.pnbindia.in) Anytime-Anywhere. This functionality simplifi es the account opening procedure with lesser time consumption at both ends i.e., customer as well as branches.

ii. Credit Deployment and Delivery

Net Advances of the Bank as at the end of March 2016 stood at Rs..4,12,326 crore, compared to Rs..3,80,534 crore as at end of March 2015, registering a YoY growth of 8.4% over last year. Yield on Advances of the Bank stood at 9.10% for the year ended March 2016.

The Technology Upgradation Fund Scheme (TUFS) is the “fl agship” Scheme of the Ministry of Textiles (MOT) for modernization and technology upgradation in the textile sector PNB is the designated Nodal Bank for claiming subsidy under TUFS. The scheme was modifi ed from TUFS to Revised Restructured Technology Upgradation Fund Scheme (RRTUFS). In order to promote ease of doing business in the country and achieve the vision of generating employment and promoting exports through “Make in India” with “Zero effect and Zero defect” in manufacturing, it has been decided that the Government would provide credit linked Capital Investment Subsidy (CIS) under Amended Technology Upgradation Fund Scheme (ATUFS). The implementation period for ATUF is from 13.01.2016 to 31.03.2022.

The scheme would facilitate augmenting of investment, productivity, quality, employment, exports along with import substitution in the textile industry. It will also indirectly promote investment in textile machinery (having benchmarked technology) manufacturing.

For speedier processing of claims under TUFS, a dedicated cell at the Corporate Office was established to facilitate claiming and distribution of subsidy to eligible textile units. The Bank has approximately 830 accounts under TUFS pertaining to SSI and Non-SSI category. During FY’16, the Bank has received TUFS subsidy amounting Rs..48.89 crore from Ministry of Textile (MOT) and the same has been disbursed to the eligible borrowers.

Further, there are approximately 227 accounts covered under 15% Credit Linked Capital Subsidy Scheme (CLCSS) and the subsidy amounting to Rs..14.90 crore received from Ministry of MSME during FY’16.

iii. Loan Syndication

Loan Syndication and Technical Study Cell has contributed significantly in garnering new business and augmenting Fee Based Income to the Bank by generating new opportunities from the projects in hand. During FY’16, the Bank gave approvals for syndication/appraisal of debt aggregating Rs..2640 crore with PNB’s share of Rs.757 crore. Total Income booked out of this activity during FY’16 stood at Rs.4.05 crore.

iv. Retail Credit

The Bank directed its policies towards boosting advances to retail segment and used it as a growth trigger. During FY’16, the Bank’s Retail Advances comprising of Housing, Vehicle, Education, Mortgage, Personal, Pensioner, Gold & Reverse Mortgage Loan Schemes increased from Rs..48,415 crore as on 31st March’15 to Rs..57,801 crore as on 31st March’16, thereby registering a YoY growth of 19.4%.

To augment Retail loan portfolio, the Bank launched Festival Bonanza offer from 01.09.2015 to 31.03.2016 by extending various relaxation in fees and charges. The growth recorded by the Bank in Festival Bonanza Offer during FY’16 vis-à-vis corresponding period of last year under Housing, Car/Vehicle and Personal Loan schemes stood at 34%, 30% and 32%, respectively.

The Bank has launched new products and upgraded the existing products keeping in view trend in the industry and needs of the customers. With a view to tapping the special segment of the society, the Bank launched “PNB Power Ride” scheme for financing two-wheeler to women borrowers only. On the eve of Foundation Day of the Bank, new variant of Housing loan scheme named “PNB Gen-Next Housing Finance Scheme” was launched wherein the borrowers will be offered 1.25 times of the loan amount calculated as per regular eligibility method.

The Bank also integrated with “Vidyalakshmi Portal”, an initiative by the Ministry of Human Resources Development to facilitate students to apply for Education Loans online. Further, with an objective to support the National Solar Mission, the Bank included Solar Power Systems financing as a Home Loan Component.

Apart from the above measures, the Bank implemented Government Schemes such as “Pradhan Mantri Awas Yojana’’ under the mission ‘Housing for All by 2022” for the Economically Weaker Sector/ Lower Income Group borrowers. The Bank also implemented the “Credit Guarantee Fund Scheme for Education Loans”, to provide Collateral Free Education Loans upto Rs. 7.50 lakh and “Credit Guarantee Fund Scheme for Skill Development” to provide Collateral Free Education Loans for skill development up to Rs.1.50 lakh to students.

v. Priority Sector

Priority Sector advances of the Bank was Rs..1,47,122 crore as on 31st March 2016 which constituted 43.06% of Adjusted Net Bank Credit against the National Goal of 40%. This shows the commitment of the Bank towards nation building and financial empowerment of the masses.

Credit to Agriculture

 Credit to Agriculture sector stood at Rs. 64,155 crore as on 31st March’16 as against Rs. 59,157 crore in March’15. The percentage of Agriculture Advances to ANBC at 18.78% was over the brscribed National Goal of 18%.

 The Bank has issued 4.54 lakh Kisan Credit Cards (KCCs) during FY’16 taking the cumulative number of KCCs issued to 55.73 lakh since inception.

During FY’16, the Bank has disbursed agriculture loans to the tune of Rs. 54,671 crore to 24.59 lakh farmers against the disbursement target of Rs. 50,600 crore.

 As per PS guidelines RBI fi xed up National Goal of 8 % to Small & Marginal Farmers to be achieved in phased manner i.e., 7% by March 2016 & 8% by March 2017. The achievement of advances to Small and Marginal farmers was Rs..30,058 crore and the Bank has surpassed national Goal of 7 % by achieving 8.80% of ANBC.

As per PS guidelines RBI fi xed up National Goal of 7.5% to Loan to Micro Enterprises to be achieved in phased manner i.e., 7% by March 2016 & 7.5% by March 2017. The achievement of advances to Loan to Micro Enterprises was Rs..27,701 crore and the Bank has surpassed national Goal of 7 % by achieving 8.11% of ANBC.

The Bank’s focus has been on increasing investment credit especially in High-Tech Agriculture Projects under Green House/ Poly House Farming, Sprinkler/ Drip Irrigation Systems Culture, Horticulture, Floriculture, Commercial Dairy, Fishery, Poultry, Financing Commercial Agricultural Farming, Plantation for forestry, Food and Agro Processing units, Agri. Logistics like Rural Go-down / Cold Storage & Agri Transport etc. besides traditional agriculture financing.

To extend focused credit to small and marginal farmers for inclusive growth, the Bank organized Special Agriculture Credit Campaigns w.e.f. 16.06.15 to 19.09.15 & 01.11.15 to 31.01.16 during this Kharif/Rabi seasons and disbursed Rs. 8503 crore against the target of Rs..8000 crore.

During FY’16, the Bank also celebrated following Weeks/Days i.e., Dairy Vikas Week from 03.06.15 to 10.06.15, Dairy Week from 08.02.16 to 15.02.16. PNB Vikas Day 05.06.2015, Special Agriculture Credit Campaign (Kharif Season) from 16.06.15 to 19.09.15, Special Agriculture Credit Campaign (Rabi Season) from 01.11.15 to 30.01.16.

To ensure issuance of ATM cards in all KCC accounts, the Bank celebrated the ATM Card Issuance week w.e.f. 11th Jan’16 to 23rd Jan’16, 22nd Feb’16 to 29th Feb’16 and 14th March’16 to 19th March’16. As a result, the farmers’ coverage percentage has increased from 32% as on 31.3.2015 to 72.5% as on 31.3.2016

Credit to Weaker Sections & SC/ST: As on 31st March 2016, the Bank’s share to Weaker Sections stood at Rs..35,506 crore and registered increase of Rs..3319 crore against March 2015. Ratio of Weaker Sections advances to ANBC stood at 10.39% exceeding the National Goal of 10%.Total outstanding Advances to SCs/STs was Rs..3901crore in 3,88,582 accounts as at 31.03.2016.

Credit to Women beneficiaries: Credit to women beneficiaries stood at Rs..20,029 crore and was 5.86% of ANBC as on 31.03.2016 against National Goal of 5%. At Corporate Office a women cell is functioning and monitoring the progress under various lending schemes for women beneficiaries.

Credit to Minority Communities: The Bank’s credit to minority communities stood at Rs..22,108 crore as on 31st March’16 as against Rs..20,936 crore as on 31st March’15. The credit to minorities constituted 15.03% of Priority Sector Advances.

New Schemes Formulated

Scheme for financing cultivation of Pineapple in North-East region has been introduced on 10.02.2016 to facilitate and promote the cultivation of Pineapple in the ideal places of the region.

Scheme for financing agriculture activities on unregistered leased/rented land to all individuals/ SHGs/ JLGs has been launched during FY’16.

Scheme for financing women Joint Liability Groups up to Rs..10 lakh without collateral security was launched during FY’16 to promote Women JLGs. Incentive scheme for facilitating Self-Help Group viz.

“PNB Sakhi” was launched on 06.01.2016. Modifi cations in existing Schemes

To enhance the share of the BankRs.s business under the Farm Mechanization segment, scheme for fi nancing of farm machinery and repair/renovation of Tractors and Power Tillers – additional guidelines for fi nancing without mortgage of land have been circulated on 10.02.2016.

To support Small & Marginal Farmers, the extent of loan under ‘PNB Bhu-Swami Scheme’ was increased from Rs..10 lakh to Rs..20 lakh.

 In order to increase the flow of credit to Women, the extent of limit enhanced from Rs..50,000 to Rs..1,00,000 under “PNB Kalyani Card Scheme”.

Micro Credit

Micro Finance through formation and credit linkage of Self Help Groups (SHGs) gained momentum. As at the end of March’16, the Bank credit-linked 2,30,669 SHGs with the outstanding amount of Rs..2137 crore. The number of deposit-linked SHGs rose to 2,80,895 cumulatively from 2,62,593 as of brvious year. The Bank has 1,67,289 credit linked women SHGs and 1,99,298 savings linked women SHGs.

A new Scheme of National Rural Livelihood Mission (NRLM) has been initiated by Government of India to promote the formation of women SHGs on the basis of affinity. In FY’15, the Bank lodged claim of Rs..3.38 crore and received subvention amount in March 2016. Interest subvention claim of Rs..2.28 crore was lodged upto Dec’15 for FY’16. Further, claim for the quarter ending March’16 will be lodged on opening of portal by Ministry of Rural Development (MORD).

vi. Micro, Small and Medium Enterprises

The Micro, Small & Medium Enterprises (MSME) plays an important role in economic development through their contribution to growth of the country, exports and employment generation in manufacturing and service sectors.

The credit to MSME sector increased to Rs.87,588 crore, thereby registering a YoY growth of 12.06 % as on 31st March’16. Out of this, the advances to Micro & Small Enterprises reached a level of Rs..69,393 crore and grew by 15.22% on YoY basis. MSME share in Non-Food Credit of the Bank has increased from 22.69% in March 2015 to 24.21% in March 2016. The Bank has added 1,52,231 Micro Enterprises Accounts as on 31st March’16, registering YoY growth of 32.6% against the envisaged growth of 10% in terms of Prime Minister High Level Task Force (PMHLTF) recommendations. Further, the outstanding under Micro Enterprise Advances as percentage of ANBC of the Bank was 8.11% as against mandated 7% under PMHLTF as on 31.03.2016

The Bank leveraged CGTMSE scheme for providing collateral free loans up to Rs. 100 lakh by vesting Branch Managers with higher loaning powers. As a result, during FY’16, the Bank covered 48,064 cases under the scheme with the credit outlay of Rs..1418 crore.

Other Initiatives for MSME Segment during FY’16 MSME Credit Growth Initiative branches: To

grow MSME portfolio by 30% on YoY basis and to significantly reduce turnaround time to 2-4 weeks, the Bank launched MSME Credit Growth Initiative in 250 branches in the month of January 2014. During FY’16, 164 more branches have been added taking the number to 414. The MSME portfolio of these identified branches have increased from Rs..44,983 crore as on 31.03.2015 to Rs..48,357 crore as on 31.03.2016 and formed 51.73% of total outstanding MSME Advances of the Bank.

Interest Concession to Advances to Taxis & Autos:

Concession in rate of interest ranging from 0.50% to 1.00% on Taxis and Autos extended in States of Maharashtra, Delhi and Gujarat. Concession in processing / upfront fee of 50% was also extended to the borrowers.

Loan against Warehouse Receipt: Special concessional rate of interest i.e., BR+1%, (inclusive of charges of Collateral Managers) has been made available under the scheme.

Interest Concession to Micro and Small Enterprises Covered Under CGTMSE:

The Bank is extending interest concessions to MSE accounts covered under CGTMSE up to 0.25%. The Bank has capped maximum rate of interest at BR+4.00% including term brmia in the CGTMSE covered accounts.

New Schemes Formulated during FY’16: The Bank has formulated the following schemes during FY’16 to give specific impetus to the targeted segment/group of borrowers:

i. PNB Green Ride for Financing e-Rickshaws.

ii. PNB Vanita for financing women entrebrneurs.

iii. PNB Nurture scheme for financing day care centres/crèches.

iv. PNB Franchisee for fi nancing franchisees of Reputed Manufacturing Companies.

v. PNB e- Smart for Financing e- Tailers.

MSME Clusters: The Bank has adopted the cluster based lending approach and adopted 101 clusters to give focused attention to the sector.

Simplified Loan Application for credit requirement up to Rs..100 lakh for Micro, Small and Medium Enterprises (manufacturing & Service sector) has been made available along with the check list of documents. Similarly Simplified Loan Application for credit requirement for more than Rs..1 crore for Micro, Small and Medium Enterprises (manufacturing sector) has also been made available along with the check list of documents.

Facility of submission of application on-line and tracking them by prospective borrowers under MSE segment has been provided. A concession of 20% in upfront fee and processing fee is extended to borrowers who submit application on-line to encourage the practice.

For growth in Service Sector: The Bank entered into Tie ups and signed MOU with vehicle manufacturers like Ashok Leyland, Tata Motors, Asia Motors Works, Hindustan Motors, Mahindra & Mahindra, Piaggio, ICM Ltd., Eicher Volvo, Atul Auto, Bajaj Motors, J S Auto P Ltd., etc. MOU was also signed with Escorts for financing transport dealers.

Pradhan Mantri MUDRA Yojana (PMMY): The Bank disbursed a sum of Rs.3593 crore to 5,96,839 account holders during FY’16 under Pradhan Mantri MUDRA Yojana.

Implementation of Government of India Schemes and Programmes: The Bank is pro-actively participating in various schemes of the Government of India like Prime Minister Employment Generation Programme (PMEGP), Credit Link Capital Subsidy Scheme (CLCSS) for Micro & Small Enterprises, Khadi & Village Industry Commission (KVIC), Technology Upgradation Fund Scheme for Textile & Jute Sector (TUFS), Subsidy Scheme for Food Processing Industries, etc. The Bank also entered into a tie up for TEQUP (Technology Quality Upgradation) & TREADS (Trade Related Entrebrneurship Assistance & Development Scheme) with Ministry of Micro, Small and Medium Enterprises.

vii. Asset Quality

The Bank's Gross NPA and Net NPA stood at Rs.. 55,818 crore and Rs..35,423 crore, respectively as on 31st March 16. In terms of ratios, the Gross NPA and Net NPA ratio stood at 12.90% and 8.61%, respectively.

The Standard Restructured Advances for FY'16 works out at Rs..20,144 crore.

viii. Financial Inclusion

Financial inclusion has been priority area for the Bank as reflected in its mission "Banking for the unbanked”. Pradhan Mantri Jan-Dhan Yojana (PMJDY) has been successfully implemented by the Bank. As a result of this, Department of Financial Services, Ministry of Finance, GOI, has declared PNB as fi rst among all banks in deposit mobilized through PMJDY accounts and second in overall implementation of PMJDY launched by Hon’ble Prime Minister of India. Further, all allocated SSAs and wards have been covered by the Bank through banking outlets.

Pioneer in some of key products

PNB is the fi rst Bank to deploy Micro-ATMs with RuPay, Aadhaar based and other FI Transactions at BC Location. ?? e-KYC, a paperless process for opening of account based on Aadhaar based authentication from UIDAI data base was fi rst initiated by PNB.

PNB is the fi rst Bank to provide Aadhaar Seeding at BC locations.

The Bank has customized and enabled RD and FD products at BC locations.

Besides basic banking, PNB also offers value added products like IMPS, Indo-Nepal remittances, etc. at BC locations of the Bank.

Special Security Schemes: Consequent upon announcement in Union Budget 2015-16, Hon’ble Prime Minister launched three social security schemes on 09.05.2015 as under:-

i) Pradhan Mantri Suraksha Bima Yojana [PMSBY] :

for accidental death insurance. As on 31.03.2016, number of customers enrolled under PMSBY stood at 52,71,657.

ii) Pradhan Mantri Jeevan Jyoti Bima Yojana [PMJJBY]:

for life insurance cover. As on 31.03.2016, number of customers enrolled under PMJJBY stood at 2,60,141.

iii) Atal Pension Yojana [APY]: The no. of enrolment under APY scheme as on 31.03.2016 stood at 1,85,593. To promote financial literacy in rural areas and to create awareness about the Bank’s schemes, a Documentary Film ‘VARDAAN’ has been screened at various training centers of the Bank.

A special campaign, jointly sponsored by PNB and NABARD to organize financial literacy camps by selected 79 Financial Literacy Centers (FLCs) in 9 States was organized from January 2016 to March 2016. The total project cost of Rs..1.48 crore was approved by NABARD, out of which 60% of expenditure is to be reimbursed by NABARD on actual basis.

d. Outlook

India’s growth story has largely remained positive in FY’16 amid slowdown brvailing across the global economy. Additionally, macroeconomic parameters like inflation, fiscal deficit and current account balance have exhibited signs of improvement. Gross Value Added (GVA) at Basic prices is estimated at 7.4% for FY’16 (by RBI) and 7.6% by Government of India compared to 7.2% achieved in FY’15. GVA for FY’17 has been projected at 7.6% by RBI and 7-7.75% by Government of India.

Sector wise analysis of GVA growth shows that Services sector growth which accounted for nearly 53% of GVA has grown at a good rate of 9.24% during nine months of FY’16. Within the Services sector, Banking, Real Estate & Professional Services growth at 10.3% is slower in comparison to 11.1% during the corresponding period last year. With the expectation of improvement in the global economy, services sector is expected to do better in FY’17.

Agriculture and Allied activities which contributed nearly 15% to GVA suffered from two successive monsoon failures and untimely rainfall in last two financial years. As a result of this, agricultural production grew at 0.6 percent during the nine month of FY’16 compared to Reserve Bank of India’s Professional Forecaster’s projection of 1.1 percent for FY’16.

The industrial production comprising Manufacturing, Electricity and Construction recorded a growth of 7.3 percent during the 9 months of FY’16 compared to 5.95 percent during the same period last year. However, Index of Industrial production (IIP) growth (comprising mining, manufacturing & electricity) for FY’16 remained lower at 2.4 percent compared to 2.8 percent during the same period last year. The industrial activities lost pace in the second half of 2015-16 because of weak domestic investment environment and a prolonged contraction in exports.

The value of Stalled Projects increased from Rs..9.37 trillion as on Q1 FY’16 to Rs..11.36 trillion in Q4 FY’16 as per CMIE report. Further, CMIE also pointed out that the value of stalled projects as percentage of total projects under implementation rose continuously throughout FY’16 and reached 12.30 percent in Q4 FY’16 from 10.60 percent as on Q1 FY’16.

The corporate sector is also facing challenges, especially the large business houses that borrowed heavily during the boom years to invest in infrastructure and commodity-related businesses, such as steel. Corporate profits are low while debts are rising, forcing firms to cut investment to brserve cash flow.

On the positive side, the government’s initiatives such as Make in India, Start-up India, Stand up India, Skill India & Pradhan Mantri MUDRA Yojana, strong commitment to fi scal targets and the thrust on boosting infrastructure may brighten the investment climate. Household consumption demand is expected to benefit from the Pay Commission award, continued low commodity prices, past interest rate cuts, and measures announced in the Union Budget 2016-17 to transform the rural sector.

Some sectors which are expected to get a boost from the government policy reforms are renewable & solar energy, railways, road & highways, housing & townships, power distribution, mining, etc. However, some sectors like metal, cotton & textile, gems & jewellery, petroleum products may continue to face challenges owing to global developments.

During FY’16, liquidity in the banking system remained tight because of controlled government expenditure and certain cyclical factors. However, RBI followed accommodative liquidity management policy and kept liquidity at reasonable levels by using various monetary tools like Open Market Operations and Term Repo Operations & Liquidity Adjustment Facility (LAF).

Interest rate is contingent upon brvailing inflation, fiscal deficit and other macroeconomic growth parameters. Considering that all the above factors were conducive, RBI reduced Repo rate from 7.25 percent to 6.75 percent during the FY’16. As a result of this, overall interest rate scenario in the market remained moderate during FY’16. As a consequence of the moderate interest rate scenario, the Banks have also reduced their Base rate to pass on the benefit of policy rate reduction to the ultimate customers.

Going ahead, in FY’17, RBI has projected inflation to remain at 5%. In successive Bi-monthly Monetary Policies, RBI has repeatedly pointed out that it will continue its accommodative liquidity and monetary policy in FY’17.

Hence, it is expected that interest rate may soften during FY’17. Further, after the introduction of Marginal Cost of Funds Based Lending Rate (MCLR) interest rates are expected to remain moderate. Easing of inflation may create room for banks to further realign deposits rates. Government’s decision to review the interest rate on the small savings schemes periodically will help in better transmission of monetary policy rates. The new methodology for computation of lending rates of banks i.e. MCLR will reduce the lending rate consequent upon change in deposit rates. Low interest rate and low-priced raw material and other inputs may reduce the operating cost for the corporate and therefore improve their revenue.

The banking scenario therefore seems to be oriented towards ‘Growth & Strength’ in business during FY’17.

e. Risks & Concerns

The risk management philosophy & policy of the Bank is an embodiment of the Bank’s approach to understand, measure & manage risk and aims at ensuring sustained growth of healthy asset portfolio. This would entail adopting leadership approach in products and segments well understood by the Bank and having br-determined risk standards of moderate to low risk level and taking limited exposure in high risk areas. This also include optimizing the return by striking a balance between the risk and the return on assets, striving towards improving market share to maximize shareholders’ value and augmenting business through attracting quality assets, strong monitoring of borrowers’ financial health and ensuring conservation of capital.

The Bank has robust credit risk management framework and has developed in-house credit risk rating models. The rating models provide a scientific method for assessing credit risk rating of a client. The Bank undertakes periodic validation exercise of its rating models ensuring their efficacy and also conducts migration and default rate analysis to test their robustness. The output of the rating models is used in the decision making of the Bank (viz., sanction, pricing, loaning powers besides Audit, Review & Monitoring of credit portfolio).

The Bank has set a desired portfolio distribution in terms of Low Risk, Medium Risk and High Risk Categories and the actual portfolio is being monitored on quarterly basis and the same is placed to the Risk Management Committee of the Board. The Bank has developed and placed on central server scoring models in respect of retail banking and SME sector advances. These processes have helped the Bank to achieve quick and accurate delivery of credit, bring uniformity in the appraisal and facilitate storage of data & analysis thereof. The scoring model for farm sector has also been developed and has been implemented across all the branches.

The Bank has in place a well defined organizational structure for market risk management functions, which looks into the process of overall management of market risk viz. interest rate risk and foreign exchange risk, and implements methodologies for measuring and monitoring the same. Tools like stress testing, duration, modified duration, VaR, etc. are being used effectively in managing risk in the Treasury operations.

Asset Liability Management of the Bank is done on proactive basis to manage any eventuality. With Core Banking Solution (CBS) covering entire branch network, the Asset Liability Management in respect of all assets and liabilities is being done on daily basis. Interest rates in respect of assets and liabilities products are fixed on scientific basis. The Bank has carried out contingency funding plan so as to tide over liquidity crunch if at all it arises.

The Bank has in place a well defined organizational structure and framework for operational risk management functions, which looks into the process of overall management of operational risk. Bank has robust operational risk management framework with a well-defined ORM Policy. Bank is identifying, measuring, monitoring and controlling/ mitigating the operational risk by analyzing historical loss data, Risk & Control Self Assessment Surveys (RCSAs), Key Risk Indicators (KRIs) and Scenario Analysis, etc. The Bank also introduced an online Op-Risk Solution under Enterprise Wide Data Warehouse (EDW) Project and placed it on central server to take care of various aspects of data capturing and management information system at various levels.

Regulatory Guidelines

The Bank has adopted Standardized Approach for Credit Risk, Standardized Duration Approach for Market Risk and Basic Indicator Approach for Operational Risk for computation of Risk Weighted Assets (RWA) under Basel II/III. As per the requirements of the RBI guidelines, relevant risk management policies such as Risk Management Philosophy & Policy, Credit Management & Risk policy, Investment policy, Asset Liability Management policy, Operational Risk Management policy, Policy for Mapping Business Lines/ Activities, Outsourcing Policy, Business Continuity Plan, Credit Risk Mitigation & Collateral Management Policy, Internal Capital Adequacy Assessment Process (ICAAP) Document, Stress Testing Policy, Group Risk Management Philosophy & Policy, Policy for management and monitoring of Intra-group Transactions, Model Risk Policy, IT Security Policy etc., are in place.

The Bank plans to migrate to advanced approaches for computation of RWA / Capital charge for Credit, Market and Operational Risks. The Bank is under parallel run for adoption of Foundation Internal Rating based Approach (FIRB) for Credit Risk and The Standardized Approach (TSA) for Operational Risk. The Bank has also been granted approval for calculation of capital charge on parallel run basis under Advanced Measurement Approach (AMA) for Operational Risk The Bank has submitted formal Letter of Intent for adoption of Internal Models Approach (IMA) for Market risk and Advanced Internal Rating Based (AIRB) Approach for Credit Risk. All the necessary actions required in this regard have been initiated.

Others major initiatives undertaken

The Bank perceives that risk culture should percolate at every level and has recently started evaluating performance of Circle Offi ces on risk adjusted basis. Zonal Managers/ Circle Heads are being advised to generate healthy economic returns, set self-targets for Total Credit Risk weighted assets/Total credit exposure ratio and achieve consistent reduction year-on-year basis. The Bank envisages developing framework on capital allocation on the basis of risk adjusted returns.

The Bank has taken necessary steps to implement the various norms as required under Basel III guidelines issued by RBI. The Bank has worked out capital requirements till full implementation of Basel III guidelines and capital planning is carried out keeping in view the various requirements under Basel III and changes brought about by the regulator.

The Bank has put in new system driven Preventive Monitoring System (Early Warning) w.e.f July 2014 for better monitoring of borrowers’ financial health and taking timely action for reduction / containment of NPAs.

f. Internal Control System and their adequacy

i. Credit Audit and Review

Credit Audit and Review Division (CARD) was formed in January 2002 as a part of Loan Review Mechanism (LRM) to examine compliance with extant sanction and post-sanction processes/procedures laid down by the Bank from time to time in high value borrowal accounts.

In terms of the extant LRM policy, Credit Audit for 2015-16 was undertaken for all eligible loan accounts including weak and takeover accounts. During FY’16, Credit Audit of overseas loan accounts in Overseas Banking Unit, SEEPZ, Mumbai also got conducted and audit of PNB DIFC, Dubai and Hongkong is under way in consultation with concerned vertical.

In terms of the said Policy, Credit Audit of borrowal accounts having exposure of Rs..2,23,124 crore, comes to 49.36% of the Bank’s net standard credit portfolio – domestic and overseas (Rs..4,52,009 crore as on 31.03.2015) up to February 2016 as against the RBI’s requirement of at least 30% to 40% in a year. Further, it has been emphasized that CARD is a specialized audit and Credit Audit reports should only highlight the Early Warning Signals and the observations in the nature of routine and Core Issues I and II (br/post sanction) will be monitored by the Inspection and Audit Division (IAD).

should invariably mention the corrective action of the observations made. Therefore, to reorient Credit Audit process towards its primary purpose of identifying criticality in credit risk and early warning signals, Credit Audit Report (Executive Summary) has been modifi ed and brought into force w.e.f. January 2016.

ii. Internal Audit

The objective of Inspection and Audit Division (IAD) is to ensure that the business of the Bank is conducted in a prudent manner in accordance with the policies and strategies approved by the Bank’s Board of Directors and to enable the management to identify, assess, manage and control the risks associated with the business. These controls are supplemented by an effective audit function that can evaluate independently the adequacy, completeness, operational effectiveness and efficiency of the control systems within the organization. IAD ensures that effective policies and practices are in place and the management takes appropriate corrective action in response to the internal control weaknesses identified by internal / external auditors.

Under risk-based internal audit, the focus has been shifted from the system of full-scale transaction testing to risk identification. Therefore, well defined policy duly approved by the Board, for undertaking risk-based internal audit has been framed. The policy includes the risk assessment methodology for identifying the risk areas based on which the audit plan would be formulated. Risk based policy focuses on frequency, prioritizing, extent of checking, risk-assessment/ profiling of activities/ functions/ products and their updating, broadening the risk classifications etc. during audit process.

Compliance of laid down systems and procedures not only helps in smooth functioning of the bank but also provides a risk free environment to achieve its goals and objectives. Inspection and Audit Division (IAD) assesses and ensures that systems and procedures framed by the bank on the basis of directions / observations made by the Regulator / Board / ACB and developed over a long period of time, are complied with.

To achieve the above objective, various type of Audits are conducted by the division viz. Risk Based Internal Audit (On-site as well as Off-site), Revenue Audit, Information System (IS) Audit, Credit Audit, Snap Audit, Segment Audit, Compliance Audit, Legal Audit , FEMA audit etc.

Besides the on-site audit, regular monitoring is being done through ‘Off-site Surveillance Cells’ set up at IAD, Zonal Audit Offices (ZAOs) and the Circle Offices (COs). Off-site Audit is also carried out in Non-concurrent Audit Branches, covering combrhensive audit items and their compliance level at these branches for assessment of change in risk direction and/or risk level in various Business and Control Risk Parameters. Accordingly, annual audit plan is formulated, approved and implemented in the bank.

The number of branches/offices under concurrent audit has increased from 1124 in FY’15 to 1274 for FY’16. Branches/offices under concurrent audit cover 68.45% of deposits, 74.82% of advances and 71.11% of overall business of the Bank as at 31.12.2015, which is in line with RBI guidelines.

Risk Audit Templates have already been implemented in the Bank and made on-line through “e-RBIA” for Non-specialized Branches, LCBs, MCBs, IBB and AD Branches, Retail Asset Branches (RABs), Assets Recovery Management Branches (ARMBs), Back Offices (RCCs, CDPCs, CBOTF), Off-shore Banking Unit (OBU) and International Service Branches (ISB), etc. Daily/Monthly/Quarterly reports and Revenue Audit is also covered under e-RBIA. Format for Quarterly Audit of Centralized Pension Processing Cell (CPPC) has also been customized in e- RBIA.

FEMA Audit templates have been revised for better audit quality as per RBI/ACB directives. Compliance of FEMA guidelines has been made integral part of Concurrent Audit through modification in e-RBIA templates. To cover FEMA stipulations extensively in other templates also, IBB/AD Branches template is currently under revision and shall be rolled out soon. Nine Head Office Divisions are also under Concurrent Audit.

IS Audit is being conducted in accordance with the RBI’s Guidance Note on Information Security, Electronic Banking, Technology Risk Management and Cyber Frauds (Gopal Krishna Committee recommendations). It is conducted through IS Auditors (External or Internal) with an objective to identify security related risks covering Data Centre (DC), Disaster Recovery Sites (DRS), Servers, Devices, Critical HO Divisions (through EAPT, VAPT, WAN and process audit), Security cum functional audit of applications, Network Centers (NCs) and Administrative Offices and Operational Audit of branches.

The Bank is moving ahead to bring all the branches under the aegis of e-RBIA. The Bank further envisages streamlining audit systems from multiple to single combrhensive audit, as suggested by Department of Financial Services (DFS), Ministry of Finance. Offsite audit system for non concurrent audit branches is also being strengthened by use of IT tools.

iii. Know Your Customer(KYC)/Anti Money Laundering (AML)

The Bank strictly follows KYC and AML guidelines issued by RBI from time to time and only KYC compliant customers are accepted by the Bank. Risk categorization of all the customers into three risk categories i.e. High, Medium and Low is followed meticulously in terms of the regulator guidelines. The Regulator guidelines in respect of Beneficial Owner are followed meticulously.

An upgraded AML Application (version 6.0.) has been installed which enables watch list scanning, verifies customer identity and facilitates generation of automated alerts for scrutiny of transactions of suspicious nature. The system-generated alerts are monitored on daily basis and in case of suspicion; Suspicious Transaction Report (STR) is submitted to Financial Intelligence Unit- India (FIU-IND).

All the brscribed reports such as Counterfeit Currency Reports (CCRs), Cash Transaction Reports (CTRs), Non Profi t Organization Reports (NTRs) and Cross Border Wire Transfer Reports (CBWTRs) are submitted regularly to FIU-IND through FIN net Gateway.

In order to sensitize/educate the fi eld staff on KYC/AML/ CFT issues, training is imparted through Zonal Training Centers (ZTCs and Central Staff College (CSC) and workshops on UCIC and KYC/AML/CFT compliance are also organized from time to time.

iv. Management Audit

The Management Audit has been identified as a separate function in the Bank and an independent Management Audit and Review Division (MARD) is in operation since 08.07.2004. The Bank has in place a Risk Based Management Audit (RBMA) system for conducting audit of its administrative offices. For this purpose, RBMA Policy was initially approved by the Board on 28.04.2006 and last reviewed on 29.02.2016.

The audit is based on Risk Templates and risk profiles brpared in-house to capture risk perceptions inherent in various areas of functioning of administrative offices including decision making process, communication system, efficient resource utilization, means used to achieve the goals, etc. Latest guidelines of RBI, issued from time to time are also taken care of. MARD is also regularly conducting snap audit of identifid circles/other administrative offices with potentially high risk perception to proactively spur them into taking steps for bringing in desired improvement in their functioning.

MARD also conducts audit of activities of Outsourcing Verifi cation of Loss Data, review of Bank’s established policies, procedures, compliance of RMC/ORMC Directives, Division level KRIs, Review of BCCP, Review of Risk Measurement System (RMD-Mid Office) and Review and Validation of ICAAP (Internal Capital Adequacy Assessment Process).

During FY’16, based on approved Annual Audit Plan, MARD conducted management audit of 38 HO Divisions, 76 Circle Offices, 13 Zonal Managers’ Offices, 13 Zonal Audit Offices, 6 Training Establishments, 5 Regional Rural Banks and 3 Domestic Subsidiaries and 2 Overseas Subsidiaries besides audit of other activities listed above.

v. Compliance

The Compliance Division at the Head Office is headed by the General Manager who is designated as Chief Compliance Officer with overall responsibility for coordinating the identification and management of the Bank’s compliance risk and supervising the activity of other compliance staff. A Compliance Policy in tune with RBI guidelines is in place. In pursuance to the Compliance Policy, the Bank adopted an independent Compliance Structure covering domestic and international operations.

The Bank has a Compliance Officer at every business and administrative unit. The Bank is committed to the policy of zero tolerance of non-compliance with regulatory guidelines. Regulatory concerns identified by regulators/ auditors are addressed on priority basis. Further, compliance functions were identified for all HO Divisions/ Circle Offices/Branches and reporting mechanism was also established at various levels for compliance in accordance with the guidelines of the Regulator. Proper systems were devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. Compliance Division has also developed a system for testing and verifying the integrity and effectiveness of internal controls at the circle level by conducting on- site compliance audit from time to time.

vi. Vigilance

Vigilance is an important facet of management function in the Organisation. The main aim of Vigilance is to inculcate a habit of good corporate governance in the organisation so that every decision taken by an employee is transparent and accountable. In this backdrop, the Bank has initiated Role Based Staff Accountability policy where role of Investigator is clearly defined and

Investigation Report vetted.

The Bank developed Green Vigilance Software in-house for transparent disposal of vigilance cases in the bank. The software was subsequently adopted by the Disciplinary Authorities of the Bank to ensure transparency. As on 31.03.2016, the total numbers of vigilance cases outstanding were 408, out of which only 13 vigilance cases are for more than one year.

During FY’16, Vigilance Awareness Week (VAW) was observed from 26.10.2015 to 31.10.2015 in all offices including subsidiaries of the bank. Essay competitions and debate competitions were organised on topics related to vigilance awareness, like moral values, ethics, good governance practices amongst school and college students at 17 centres in 57 schools/colleges identified by CVC/Bank in different parts of the country and prizes distributed to winners.

The Bank is issuing circulars from time to time setting directions to be followed by field functionaries as a measure of brventive vigilance to avert fraudulent activities and loss to customers and the Bank. The Chief Vigilance Officer brsided over seminars amongst officials to make aware of the fraudulent activities.

Right to Information Act

The Right to Information Act has been implemented by the Bank. The relevant information as per Right to Information Act has been posted on the Bank’s website (www.pnbindia.in). During the period 01.04.2015 to 31.12.2015, the Bank received 6150 applications and provided requisite information to 4330 applicants and 1811 applications were found exempted under the provision of the Act. The outstanding applications were 233 as on 31.12.2015 for disposal, which have been subsequently disposed off within the brscribed timeframe.

g. Discussion on Financial performance with respect to operational performance

The Bank’s total business reached Rs..9,65,377 crore at the end of March’16, registering an absolute increase of Rs..83464 crore and a YOY growth of 9.5%. The Bank’s overseas business grew by 11.2% during the year. The share of Overseas Business in Global Business increased to 11.61% as at 31st March’16 as compared to 11.43% in corresponding period last year.

h. Material Developments in Human Resources/ Industrial Relations front including number of people employed Human Resources Management

The Bank recognizes its employees as the most vital and valuable asset. Total number of employees including those in the subsidiaries was 70,801 at the end of March 2016

Manpower Planning

For FY’16, the Manpower Plan was finalised well in time in a scientific manner, properly taking care of impending retirements, future branch openings/activity, business expansions and other requirements. As per plan, 9150 vacancies in Officer Cadre and 3900 vacancies in Clerical cadre (Special Assistants & Clerks) will be filled up by way of Internal Promotions. The promotions shall be released in phases as per Bank’s requirement / vacancy positions / retirements / other exits.

Similarly, as per Plan 1650 vacancies in Officer Cadre and 5500 vacancies in Clerical cadre (including 5% by way of compassionate appointment) will be filled up by Direct Recruitment. Further, 3600 vacancies in Subordinate cadre (including Armed Guards) will be filled up by Direct Recruitment & Absorption as per existing guidelines.

Recruitment Planning

Based on the Manpower Plan for 2015-16 approved by the Board, an extensive recruitment Plan was brpared and blueprint of the whole project from the date of advertisement till the date of joining of the new recruits, was finalised well in advance so as to ensure completion of the projects in a time bound manner at the earliest. Joinings after recruitment are kept alligned with the immediate shortages.

Age Profi le of the Employees

As a result of the carefully planned & executed Human Resource Development Plans, the Bank undertook need based extensive recruitment in the last three years which also resulted in changes in employee age profile. The movement of cadre-wise average age in the last few years is as under:

Welfare Schemes for Staff

The Bank continued with its 13 Welfare Schemes for staff for FY’16 as well. A Core Working Group is set up to monitor the schemes and make improvement in schemes from time to time. Meeting of the Core Working Group is held from time to time and was need based.

New Initiatives

 PNB Navodaya- Employee On-boarding and Mentoring Mechanism: On-boarding & Mentoring Program titled “PNB Navodaya” has been introduced for newly recruited energetic, tech-savvy but inexperienced employees to acquire the necessary knowledge, skills and behaviour to become effective organizational member. The program will also help to channelize these employees’ energies towards Bank’s development, with a view to transform them into brand ambassadors for the business growth and organizational goal.

PNB Univ. (E-learning System): Mobile App named ‘PNB Univ.’ has been launched for all PNB Parivar Members. It is available on all major Mobile Platforms, besides web based access through Desktop or Laptop. It will provide a quick access to quality curriculum and high quality training 24x7 right on the palm top. ‘PNB Univ.’ will bring learning to people instead of people to learning.

The Bank’s exclusive e-learning platform is accessible 24 X 7 to all employees across the country and abroad. This is an interactive mode of learning that covers Banking topics on various focus areas viz., Credit, Foreign Exchange, Retail Banking, CBS/IT, KYC, AML, Marketing, Risk Management, Resolution of NPAs etc. Development of App Based learning is under process on the lines of Khan Academy and ITC Faridabad, Information Technology Division and Digital Banking Division are working on it.

An Online Employee Grievance Redressal System-

PNB Samadhan: “PNB SAMADHAN”, a formal system for redressal of work related and personal grievances of working staff members has been revamped and made online to leverage technology to make the process of grievance redressal fast, transparent and more effective. All grievance handling is being done only through HRMS. A link is available in HRMS to every employee where the grievance can be registered. The entire system is technology driven with aggressive timelines to avoid use of paper to the extent possible.

Leadership Development Forum and Succession Planning:

Leadership Development Forum (LDF) for all officials in Senior Management Cadre in Scale IV and above was formed with the purpose of addressing the talent gaps in critical position on account of large scale retirements. The officers who were identified for shouldering important and critical responsibilities have been carrying out their functions successfully.

Industrial Relations

Industrial relations in the Bank continued to be cordial with issues raised by Workmen Union/Officers’ Association being attended to immediately. Various meetings were held with the rebrsentatives of the majority Officers’ Association/Workmen Union during the year to discuss various issues and taking steps to resolve the same.

Training Activities

The Training system of the Bank is functioning effectively for enrichment of Knowledge. Skills and Attitude of staff at all levels are being developed in line with the organizational objective to align technology with customer centricity.

The Bank has a three tier training set up comprising of one apex level training centre at its Headquarters in Delhi. The centre named as ‘Central Staff College’ (CSC) is located in the serene environments at Civil Lines, Delhi. It caters to training needs of Top / Senior / Middle Management Grade officers on ‘All India’ basis. Three Regional Staff Colleges (RSCs) are located at important and strategically located cities of Mumbai, Lucknow and Chandigarh. They cater to training needs of Senior/Middle/ Junior Management officers as well as workman and sub staff.

In addition seven Zonal Training Centres (ZTCs) are also functioning across the country at Dehradun, New Delhi, Jaipur, Kolkata, Kozhikode, Ludhiana and Patna and looking after the training needs of Middle / Junior Management Grade officers, Clerical and subordinate Staff. Information & Technology being the backbone of banking, the Bank has one exclusive IT Training Centre located at Faridabad catering to training needs of officers in the areas of Information Technology. An autonomous

Institute named PNB Institute of Information & Technology (PNB IIT), located at Lucknow. PNB IIT, in addition to conducting IT programmes on Banking Technology for officials of various banks, also runs an exclusive channel for the Bank.

The Bank also imparts training to its officers in different Grades in specialized areas through outside training institutions of repute both in India and abroad viz., ASCI Hyderabad, COD Hyderabad, IDRBT Hyderabad, NIBM Pune, CAB (RBI) Pune, IIM Lucknow, CAFRAL, IIBF Mumbai, FEDAI, MDI and NIBSCOM, BIRD Lucknow, IIBM Gauhati, etc. In view of large scale recruitments in 2015-16 also, ‘Induction

Training Programmes’ of 1-30 weeks were conducted for all newly recruited Officers and workmen to make them branch ready before joining their duties in the field. In addition, for the existing employees’ trainings in key subject areas like Credit, Agriculture, SME, Foreign Exchange, Information Technology, NPA Management, Risk Management etc. were conducted.

All SC/ST employees aspiring for promotion to higher grade/ scale were provided Pre-promotion trainings. Similarly newly promoted officials in different Grade / Scale were covered under post promotion trainings both in functional & management skill areas so as to equip them to take up higher responsibilities. Besides, Faculty Development Programmes (FDPs) were also organized for enhancing the training skills of in-house Faculty.

Further, as a part of succession planning in the Bank and to enhance Management qualities amongst Senior/Top Management Grade Officers, the Bank constituted 3 Leadership Development Programmes, under “NIBM, Pune” a reputed training institute in which 105 AGMs and DGMs participated. CSC also conducted 13 MDP Programmes in which 683 Senior Offi cials were imparted training.

Training Policy of the Bank envisages a training reach of 50% of employees every year. Towards fulfillment of this objective, during FY’16, the Bank imparted 2,30,927 man days training to 50,054 employees through in-house training. In addition, 43304 man days training has been imparted to 2716 officers at reputed outside Institutes in India and abroad.

On Location Training

As per Training Policy of the Bank, 496 on-location programmes were conducted, in which 10,525 employees were imparted training on different small modules, including Soft Skills for front line Staff. Further programmes on LAPS, New IT Initiatives, ADC and Mobile Banking, NPA Management, Credit Rating, Risk assessment, e-Auction, etc. were organised.

e-Learning

Training system of the Bank makes extensive use of technology for facilitating greater training reach to the staff. There is exclusive Knowledge Centre website, comprising of e-circular of all HO Divisions, knowledge repository of latest banking and economic updates. This web-site is available to the staff both through CBS network as well as internet.