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No.3 16.-201 Circular I -BC-RBD-34

eCircular

Date: l8-l l-2011 PERMANENT UTTLITY DUE DILIGENCE REPORTOF MSME BORROWERS BY CRISIL oaOe) Attention of Branches/Offices is draivn ro HO.Cir.No.287/2011/BC dated 22.10.2011 regarding implementation of Scheme for Financing Micro andSmallEnterprises -"SyndMSE" with effect&om 0l.l 1.201 l. Rateof interest on MSEshasbeen drastically reduced andprocess at operational levelare simplified to provide the increased thrust on credit flow to Micro and Small Enterprises. Further,to increase our reachto MSME Sector by ensuring availabilityof adequate andtimely creditto the sector, it{srintended to avail the services of CRISIL to empowerthesanctioning authorities with additional inputsto enable themto taketimely creditdecisions. CRISIL is engagedin the businessof credit rating, investmentresearchand also collection and dissemination of corporate, financial,marketinformation to variousclients.CRISIL hasstarted rating services for SmallandMediumEnterprises in 2005andhasso far evaludted morethan30,000MSMEs across the country.Several corporate areutilizing the services to CRISIL to evaluate their existingand prospective dealers,vendors,associates, franchisees, etc. Our Bank has enteredMemorandum of (MOU) with CRISIL on 28.10.2011 Understanding to provideDue DiligenceReports for MSME customers to supplement our internal evaluations andfor better understanding of various risksinvolved whilelending to MSMEs. Duediligence is a process to verif andvalidate thecredentials of the prospective borrower. Thisis an intense andfocused exercise conducted by a neutral crediblethird party. Bankhasan exclusive tie up with CRISIL'for Due Diligenceand the process is intemalized as per bank's requirement. This exerciseis undertaken to supportthe opinion of credit appraisalin the bank and offer comfort for decisionmakersat all levels.The exercise encompasses site visit, reference checks,and a brief management discussion. The due diligence process is completed within a shorttumaround time of 7 daysfrom the dateof receiptof complete documents and conducting a management discussion. This quickerloanprocessing enables andenhances the competitive edgeofthe bank. Benefits of obtaining Due Diligence ) Validationof prospective MSMEscredentials by a credible, reputedandneutralthird parfy. F Offersconfidence andcomfortto sanctioning authorityfor taking a well informedcreditdecision. ) Rigorous process of site visits,management discussions, refereniechecks, etc. ) Helps hranches to expand business andquickdecision making ) Cultivates andenhances disciplinewith theunorganized Micro, SmallandMediumenterprises. Eligible Units: > All MSME unitsasper RBI/Gol guidelines wirhcredit facilitiesfrom {l crore to { 25 crore in respect of solebanking arrangement payable Fess to CRISIL : Professional fee of{ 18700+ service taxl per reportall inclusive is payable to CRISIL in advance on collectionof all requireddocuments.The fee charged by cRISIL is to be paid out of processing /upfrontfeeto be collectedfrom the borrower. } Non refundable 25%o of theapplicableprocessing /upfrontfee is to be collected from theborrower beforereferringthe proposal to CRISIL .

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1 l-BC-RBD-34/18.11'201 No.316 Circular -201

at No. 0032-0500-0032 account to CRISIL'sBankCurrent feeshallbe remitted F Theapplicable by 400 014 Mumbai Dadar, Road, Dr; Ambedkar ICICI BankLtd., - DadarBranch,Poonawadi, E 3l5l AAACT No: PAN ICIC0000032. Code: code: 400-229-0|0,IFSC NEFT/RTGS.(MICR 001) TaxNo: AAACT 3151EST :Service at CRISIL for clarifications: Contactpersons to get in touchwith Mr' Madhumangesh advised details brancheslare on remittance For any queries mbagul@crisil.com him at email or at 022-3342-1917 Bagul etc. CIBIL at the followingaddress the Manager, may contact branches Foranyotherqueries Mr. SerjilAlam , Manager Road, FI oor,43I 44,Montieth Mezzanine House, Thapar Chennai Egmore, -600008. 3I 6,Fax:9 144285475 63| 36, 0988480220 TeI: 9 I 44 66.5 Emai I : sala"m@crisil.com Report : to obtain Due diligence Procedure of MSME client as per the list for preparingthe Stepl. Branchwill collect all requireddocuments for creditfacilities. of application receipt (Annexure on Report Diligence Due -I) /upfront fee from the borrower in advance non of the applicableProcessing Step 2.Collect25o/o proposal CRISIL. to the referring before refundable II and process as per Annexure aboutCRISIL due diligence to inform the applicant Step 3.Branch Branch emails, to access id or have email do not wherecustomers *uik u copy to CRISIL. In cases with a emailcopyto CRISIL. courier/post through informcustomers should of CRISIL to a bankaccount feesthroughRTGSd{EFT to remit entiredue diligence Step4.Branch as of BankAccount Report of M/s ......,..." (Details with a narration "FOR CRISIL DueDiligence above) andfee of loanapplication details informing to sendan emailto svndicatebank@crisil. Step5 Branch in -lII per format Annexure as details remittance and informationfrom the branchand contactthe will collect documents Step 6. CRISIL associates to CRISIL (if any)andsendthe documents documents sitevisit and collectremaining clientto conduct HO, with the informationand conducta brief telephonicconversation to analyse Step 7. CRISIL analysts thecustomer. Step 8. CRISIL to sendthe due diligencereportwithin 7 working daysform site visit and telephonic with customer.The reportshallbe sentto branchalongwith the invoicecontainingall the conversion aspects. inspiteof repeated loan applicant for a particular If the branchis not ableto collectall the information alongwith 3 Years documents Related branch shouldin the minimumcollectthe Financial follow-ups,the of otherinformation, for non-availability thereason (personal andintimate & company) tax retums Income is branch However, information. andcollect balance the clientaccordingly so thatCRISILshallapproach tumaround the to CRISIL, is not submitted information to takenoteof the fact that if complete requested of client. based on theco-operation may getextended, of reports time for submission

l-201I l-BC-RBD-34/18-l No.3l6-201 Crcular

Due DiligenceReport would cover the fotlowing aspectsof the borrowers and their business activities: in the field andexperience description profile:Business ) Business customerprofile andsupplierprofile andsupplysideanalysis: >> Demand profile of owner/partners/promoters pa'ttem andmanagement ) Ownership andsystems structure, oontrols ) Organizational ) Key management Personnel andfirms of othergroupcompanies ) Brief details enjoyed thebankandfacilities name of with facilities F Current banking key turnover, sheet, balance performance - profit andlossaccount, ) Current andpastfinancial ratios, andfund'flowstatement financial by management) owned(asconfirmed of properties Details X,$ite visit details, feedback) Bankers Suppliers/ Customers'/ ) Thirdpartychecks: Other Guidelines to CRISIL for Credit facilities from {l for Due DiligenceReportis to be submitted ) The request processing and shall not delay the quicker loan to enable ior MSMEs t 25 crore crore upto process ofsanction. uponthe requirement to CRISIL for Due diligencereportdepending shall refer the cases ) branches to case basis. on case of the borrowerand their all the aspects that Due Diligencereportcontains F Branches shall ensure activities. business to the branchwithin 7 days from the date of ) The Due.DiligenceReport will be delivered of sitevisit' and completion documents of all requisite subrnission in time the reportif any shallbe takenup with CRISIL, If not resolved F The delay in furnishing office. theirRegional through Bangalore with CO:MSME, shalltakeup thematter Branches andseek in this areaextensively to makeuseof CRISIL'sexpertise areadvised All Branches/offices will not only This of t I croreto { 25 crores. reportfor MSMEswith exposure their "Due Diligence" in taking qualitative support provide but also for branches proposals savetime in aplraisal oi NASNAS decisions. timelycredit Clarificationsrequired,if any, on take note of the aboveguidelines. are requested Branches/Offices & Retail Banking Enterprises &Medium Small Micron from sought may be this circular Department at Corporate Office, Bangalore through respectiveRegional Office, as per extant guidelines.

MAOAX:YRSRE:YRUNO Check Word

GENERAL MANAGER

I l-201 Circular No.3l6-201l-BC-RBD-34i18-l

I Annexure

V d'
F

nnexurel

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i

,. Dilieence and inforFatio4 requiredbv 9RISIL for ConducfiqeDue. List,of documentp

Financial related

./ Audited/Provisional entity 1 for evaluated fo, ZOtO-t financialstatefi:lents ./ Financialstatements entity and2007-08for evaluated (annualrepoh) for 2009-10, 2008-09 ./ Financial group entities I for / Provisional 2010-l (annual 200$'10 report) for statements ./ Net worth statements (statements shouldbe certified by CA) of all promoters related Bankinsfacilities r' of all longtermdebt Repaypgnt schedule

related Compliance Statutorv ,/ ,/ ./ ,/ ,/ / (personal & company) tax retums 3 YearsIncome tax retums 3 Yearssales 3 Yearsexciseduty returns retums ESICiEPF 3 Years 3 Yearswealthtax returns in respect of new units /Finalpowersanction Proofof Provisional

Others Provide documentssupporting for registration (memorandumand articles of associations, (if any). partnership documents). agreements, andregistration namechange andlegalstructure. Documents supporting (if any). changes in capital Documents supporting policy- Xeroxcopy. Insurance Details of Tax Exemptions. (copyof telephone bill proofof the entity and promoters andguarantor bill or electricity Address or copyofdrivinglicense) or copyofpassport

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I 1-201 l-BC-RBD-34118-1 l6 -201 No.3 Circular

AnnexureII

Ref : 000/001/2011-12

Date:dd/mm/yy

Mr. ABC Pvt Ltd Company

trpm:

Biinch Head Bank Syndicate

Sub: CRISIL .; ,, i?. , DearSir,

Due Diligence RePort on

XYZ

Company Pvt

Ltd

time, to provideyou bestin classservicelevelsand improveour turnaround endeavor In our constant we are this Towards MSME customers. our of for evaluation new initiative an a on embarked we have risk andpolicy advisory and leadingrating,research, with CRISIL - India's mostrespected partnering of MSME customers' duediligence company,to undertake for for a meeting.They will alsobe requesting of CRISIL will contactyou requesting Representatives your you extend to the due diligenceReport.We request requiredfor preparing copiesof documents and informationcollection themin the documentation andassist to CRISIL rlpresentativei cobperation process. our public sector banks,is to reduce India'sleading Bank- amongst This initiativefrom Syndicate enhance process to credit delivery our strengthen & collection information improve time, tumaround with us. of dealing your overallexperience You Thanking YoursSincerely

ffi

BranchManager

<rsOe)

l-2011 No.316 1-BC-RBD-34/18-1 Circular -201

Annexure III SpeCimen letter to CRISfL authorizingto conductDue Dilieence. Ref : 000/001 /2011-12 CRISILLtd CRISILHouse, Hiranandani Business Park, - 400 076 Powai,N$f"4bai From: Branch Manager Bank Syndicate Date: (ddimmlyy)

(Complete address of branch) BICCode:XXXX Tel:+91XX XXXXXXXX Sub:CRISIL DueDiligence Reporton ...........Company Pvt Ltd. DearSir, As per the agreement executed with the Bank,we areauthorizing you to conductDue Diligencein the case of .........XYTCompany PvtLtd. Necessary intimationin this regardis already passed on to the customer alsoandwe havealsoremitted * service an amount your of { 18,700/tax to account no: 0032-0500-0032 with ICICI Bank,Dadar Branch on DD/MM/YYYY & thereference no for thesame is Givenbelowarethecontact details of thecustomer:
Name of entity Name of the customer Contact no. of the customer Email Address customer

Addressof entity

Loan amount aonliedfor

Please submityour reportwithin 7 days. Thanking You Yours Sincerely

BranchManager