Serving to empower.

REPORT ON SUMMER TRAINING

[TITLE]
“WORKING CAPITAL FINANCING
BY J&K BANK PLUS EMPLOYEE SATISFACTION”

Submitted to Lovely Professional University

In partial fulfillment of the

Requirement for the award of degree of
Masters of Business Administration

Submitted by;
Nighat Qadir
Regd. No. 10811672

DEPARTMENT OF MANAGEMENT
LOVELY PROFESSIONAL UNIVERSITY
PHAGWARA
(2009)

Page 1 of 119
 Serving to empower.

Declaration
I,Nighat Qadir,a bonafide student of Lovely Professional university,hereby,declare that this
project report titled “Working Capital and Term Loans Financing by J&K Bank”under
the supervision and guidance of Mr. Mateen Qadir, Financial Service Executive , South
Cluster, J&K Bank, Anantnag, submitted in partial fulfillment of the requirement for the
award of Masters Degree in Business Administration ,to LPU,Jalandhar,Punjab,is my
original work and the same has not been submitted by me for the award of any other
degree,diploma,fellowship or any other titles or prises.

Page 2 of 119
 Serving to empower.

Acknowledgement
First of all I must thank Almighty Allah who is behind my every success in life and without
His blessings; this project would not have been completed. I would like to thank my Parents
who constantly supported and encouraged me throught this project.
I have been blessed by significant help and support from many people during this project.
I passionately record my sincere thanks to the organization of J & K Bank for providing me
this grateful opportunity for doing this project in a healthy working environment.
I would like to express my profound gratitude to my supervisor Mr. Syed Mateen Qadiri,
Financial Services Executive of Advance Department, south cluster of J&K Bank for their
assistance, guidance, untiring advice and encouragement.
I am grateful and gratified to the respected Lovely School of Business, (LSB), of L.P.U for
grooming me into a true line of work.
I genuinely thank Mr.Rohan Sharma, lecturer, LSB, LPU for providing me timely
assistance which helped me to accomplish this task.
Last but not the least; I would like to thank all those who directly or indirectly helped me in
the completion of this project.

Page 3 of 119
 Serving to empower.

PREFACE

For management career, it is important to develop managerial skills. In order to achieve

positive and concrete results, along with theoretical concepts, the exposure of real life

situation existing in corporate world is very much needed. To fulfil this need, this practical

training is required.

I took training in fast growing company JK BANK. It was my fortune to get training in a very

healthy atmosphere. I got ample opportunity to view the overall working of the company.

This report is the result of my seven weeks of summer training in JK Bank, South Zone,

Anantnag as a part of M.B.A. The subject of my report is-Financing of working capital and

term Loan by Jk bank.

In the forthcoming pages, an attempt has been made to present a comprehensive report

covering different aspects of my training.

After completing this project, I have undergone a number of changes, for good. Be it an

increase in my knowledge, confidence level and manner of communicating with the people.

This summer training at Jk Bank has made me much improved individual both on the

personal as well on the professional fronts and has prepared me to a great extent to take up

the future challenges.

Page 4 of 119
 Serving to empower.

CHAPTERS Page No.’s

Internship Programme 6

Executive summary of the Project 7
CHAPTER-I INDUSTRY PROFILE
History of banks 11-14
Major players and their market share
Upcoming foreign banks in India 14-19

CHAPTER-II COMPANY PROFILE

History of JK Bank 21-23
Corporate mission and vision 24-25
CSR Aspect & B.O.D 25-29
Strategies and characteristics 30
Future plans 31
SWOT Analysis 32-33
CHAPTER-III
Products and services 35-53
General insurances 54-60

Financial statements 61-65

CHAPTER-IV WORKING CAPITAL
Working capital of J&K Bank 66-70
Working capital financing by J&K Bank 70-77
Live case study 78-95
Employee satisfaction 96-116

Conclusions 117

Suggestions and recommendations 118

Bibliography 119

Page 5 of 119
 Serving to empower.

INTERNSHIP PROGRAMME

The internship programme is part of the mandatory course completion required for the

Masters programme in business administration at the school of business studies, Lovely

Professional University,Punjab. Students are required to undertake summer(practical)

training of 4-5 weeks in any company at the end of the 2nd semester. This provides students

with the opportunities to apply business concepts and techniques, which they learn in the

class room and the final semesters becomes more goal oriented and meaningful.

Page 6 of 119
 Serving to empower.

Executive summary
The banking industry has shown tremendous growth in volume and complexity during the
last few decades. Despite making significant improvements in all the areas relating to
financial viability, profitability and competitiveness, there are concerns that banks have not
been able to include vast segment of the population, especially the underprivileged sections
of the society, into the fold of basic banking services.
This project report is based on the survey and practical work done by me for the completion
of my summer training programme in JK Bank, Anantnag.The project is entitled “Financing
of Working Capital and Term loan facilities by Jk Bank Plus employee satisfaction”
My work was completed over a 5-6 weeks period in the South cluster of JK Bank,
Anantnag.The authorities of the bank provided me some practical work to do related to the
working capital and term loans, which worked as an effective tool for me to understand the
concepts learnt in the class room.During this project, I analysed various cases and learnt a lot
about the procedures and steps adopted by the bank for providing the credit, loan and
working capital facilities to its needy customers. During this course of time, I studied about
various products and services offered by the JK Bank . I surveyed to study the employee
satisfaction of the organisation. I analysed the practical cases of two units-A drug
manufacturing unit and an Educational trust that need to be financed.
The drug manufacturing company “XYZ” needs finance for establishing its firm which will
be manufacturing the ayurvedic products from the locally available herbs. The scope of its
success in this industry was analysed. Its need for the raw materials, manufacturing processes
etc was investigated. The report of its projected financials was collected, tabulated and
thoroughly analysed. The demand for the working capital by the firm was Rs 60.00 Lacs but
after complete analysis of the working cycle and the important parameters of the same like
the sales, utilization capacity and projected profitability position of the firm in the coming
five years, it was found that the firm will be facilitated with the working capital of Rs 20.00
Lacs and the term loan of Rs 12.00 lacs.
The second case I went through was of an educational trust that needs the term loan
facility of Rs 35.00 Lacs for its establishment. The same procedure was adopted for this trust.
.

Page 7 of 119
 Serving to empower.

Besides that the survey of the various schools in its vicinity was done to look for the fee
structure and the projected financials of the trust was prepared and analysed.
OBJECTIVES OF THE RESEARCH:

1. To know various types of Financial Products and Services provided by J&K Bank
Ltd.
2. To identify the key benefited areas by these financial services.
3. To know the methods employed by the bank to market their products.
4. To get acquainted of banking activities.
5. To working capital management of J&K Bank
6. To study the method of financing by J&K Bank
7. To know the employee satisfaction level of J&K Bank employees.

SOURCES OF INFORMATION:

PRIMARY SOURCE:
• Through structured questions.
• Face to face interview.

SECONDARY SOURCE:

• Records maintained by the bank.

• Websites.
RESEARCH METHODOLOGY:

The project was conducted by means of an exploratory research in order to understand

financing by the bank.

DATA USED:

Page 8 of 119
 Serving to empower.

Both primary and secondary data was used .Bank brochures, diaries, books, other written
material and bank’s website were used to collect secondary data.
SAMPLING PLAN:
UNIVERSE: Anantnag Town
SAMPLE SIZE:70
SAMPLING TECHNIQUE:
The sampling technique I used was that of convenience sampling.
Data analysis was done by means of pie charts.

Page 9 of 119
 Serving to empower.

CHAPTER-I

Page 10 of 119
 Serving to empower.

PROFILE OF BANKING INDUSTRY

A ‘bank’ is a financial institution whose primary activity is to act as a payment agent for
customers and to borrow and lend money. It is an institution for receiving, keeping, and
lending money.
The first modern bank was founded in Italy in Genoa in 1406; its name was Banco-di-San
Giorgio (Bank of St. George).
Many other financial activities were added over time. For example banks are important
players in financial markets and offer financial services such as investment funds. In some
countries such as Germany, banks are the primary owners of industrial corporations while in
other countries such as the United States banks are prohibited from owning non-financial
companies. In "France Bancassurance" is highly present, as most banks offer insurance
services (and now real estate services) to their clients.

HISTORY OF BANKING
Without a sound and effective banking system in India,it cannot have a healthy economy.The
banking system of India should not only hassle free but it should be able to meet new
challenges posed by the technology and anyother external and internal factors.
For the past three decades,India’s banking system has several outstanding achievements to its
credit.The most striking is its extensive reach. It is no longer confined to metropolitans or
cosmspolitans in India. In fact, Indian banking system has reached even to the remote corners
of the country.This is one of the main reason of India’s growth process.
The govt’s regular policy for Indian bank since 1969 has paid rich dividends with the
nationalization of 14 major private banks of India.
Not long ago, an account holder had to wait for hours at the bank counters for getting a draft
or fpr withdrawing his own money. Today, he has a choice.gone are days when the most
efficient bank transferred money from one branch to other in two days.Now it is simple as
instant messaging or dial a pizza.money has become the order of the day.
The ist bank in India,though conservative was established in 1786.From 1786 till today ,the

Page 11 of 119
 Serving to empower.

journey of Indian banking system can be segregated into 3 distinct three phases.Those are as
mentioned below:
• Early phase from 1786 to 1969 of Indian banks
• Nationalisation of Indian banks and upto 1991 prior to Indian banking sector Reforms
• New phase of Indian banking system with the advent of Indian Financial And
banking sector Reforms after 1991
To make this write-up more explanatory, I prefix the scenario as phase I, phase II and phase
III.
PHASE I
Hindustan and Beagal Bank.The East-India Company established Bank Of
Bengal(1809),Bank of Bombay(1840) and Bank of Madras(1843)as independent units and
called it Presidecy Banks.These three banks were amalgamated in 1920 and imperial Bank of
Indai was established which started as private shareholders banks,mostly European
shareholders
In 1865 Allahabad Bank was established and first time exclusively by Indians, Punjab
National Bank Ltd. was set up in 1894 with headquarters at Lahore .Between 1906 and 1913,
bank of india, Central Bank of India, Bank of Baroda, Canara Bank, indian bank and Bank of
Mysore were set up. Reserve Bank of India came in 1935.
During the first phase the growth was very slow and banks also experienced periodic failures
between 1913 and 1948. There were approximately 1100 banks, mostly small. To streamline
the functioning and activities of commercial banks, the Government of India came up with
The banking companies act , 1949 which was later changed to banking Regulations Act 1949
as per amending Act of 1965(Act no . 23 of 1965 ) . Reserve bank of India was vested with
extensive powers for the supervision of banking in India as the Central Banking authority.
During those days, public has lesser confidence in the Banks. As an aftermath deposit
mobilization was slow .Abreast of it the savings bank facility provided by the postal
department was comparatively safer.Moreover funds were largely given to traders.
PHASE II
Government took major steps in this Indian banking Sector Reform after independence in
1955,it nationalized imperial Bank of India with extensive banking facilities on a large scale

Page 12 of 119
 Serving to empower.

specially in rural and semi-urban areas.It formed state Bank of India to act as the principal
agent of RBI and to handle banking transactions of the union and state governments all over
the country.
Seven banks forming subsidiary of state Bank of India was nationalized in 1960 on 19th July,
1969, major process of nationalization was carried out. It was the effort of the then Prime
Minister of India, Mrs. India Gandhi.14 major commercial bank in the country was
nationalized.
Second phase of nationalization of banks, India Banking Sector Reform was carried out in
1980 with Seven more bank. This step brought 80% of the banking segment in India under
Government ownership.
The following are the steps taken by the Government of India to Regulate Banking
institutions in the country.

• 1949: Enactment of Banking Regulation Atc

• 1955: Nationalisation of State Bank of India.
• 1959: Nationalisation of SBI subsidiaries.
• 1961 :Insurance cover extended to deposits
• 1969: Nationalisation of 14 major banks.
• 1971: Creation of credit guarantee corporation
• 1975: Creation of regional rulal Banks.
• 1980:Nationalisation of seven banks with deposits over 200 crore
After the nationalization of banks, the branches of public sector bank India rose to
approx.800% deposits and advances took a huge jump by 11000%.
Banking in the sunshine of govt. ownership gave the public implicit faith and immense
confidence about the sustainability of these institutions.

PHASE III
This phase has introduced many more products and facilities in the banking sector in its
Reforms measure.In 1991, under the chairmanship of M Narasimham,a committee was set up
by his name which worked for the liberalization of banking practices.
.

Page 13 of 119
 Serving to empower.

The country is flooded with foreign banks and ATM stations.Efforts are being put to give a
satisfactory service to customers.Phone banking and net banking is introduced the entire
system became more convenient and swift.Time is given more importane money.The
financial system of Indai has shown agreat deal of resilience.It is sheltered from any crisis
triggered by any external macro economics shock as other East-Asian countries suffered.This
is all due to a flexible exchange rate regime,the foreign reserves are high,the capital account
is not yet fully convertible and banks and their customers have limited foreign exchange
exposure.

Qualitative growth

The growth of banking in the coming years is likely to be more qualitative than quantitative,
according to the report. Based on the projections made in the "India Vision 2020" prepared
by the Planning Commission and the Draft 10th Plan, the report forecasts that the pace of
expansion in the balance-sheets of banks is likely to decelerate. The total assets of all
scheduled commercial banks by end-March 2010 is estimated at Rs 40,90,000 crore. That
will form about 65 per cent of GDP at current market prices as compared to 67 per cent in
2002-03. Banks assets are expected to grow at an annual composite rate of growth of 13.4 per
cent during the rest of the decade against 16.7 per cent between 1994-95 and 2002-03. On the
liability side, there is likely to be large additions to capital base and reserves. As the reliance
on borrowed funds increases, the pace of deposit growth may slow down. On the asset side,
the pace of growth in both advances and investments is forecast to weaken.

MAJOR PLAYERS IN BANKING INDUSTRY AND THEIR MARKET SHARE

State Bank of India:It is India's largest bank amongst all public and private sector banks
operating in India. State Bank of India owns and operates many subsidiaries and Joint
Ventures-

Banking susidiries

• State Bank of Bikaner and Jaipur (SBBJ)

Page 14 of 119
 Serving to empower.

• State Bank of Hyderabad (SBH)

• State Bank of Indore (SBIr)
• State Bank of Mysore (SBM)
• State Bank of Patiala (SBP)
• State Bank of Saurashtra (SBS)
• State Bank of Travancore (SBT)

Foreign subsidiries

• State bank of India International (Mauritius) Ltd.

• State Bank of India (California).
• State Bank of India (Canada).
• INMB Bank Ltd, Lagos.

Non-banking subsidiaries

• SBI Capital Markets Ltd (SBICAP)

• SBI Funds Management Pvt Ltd (SBI FUNDS)
• SBI DFHI Ltd (SBI DFHI)
• SBI Factors and Commercial Services Pvt Ltd (SBI FACTORS)
• SBI Cards & Payments Services Pvt. Ltd. (SBICPSL)

Joint venture

• SBI Life Insurance Company Ltd (SBI LIFE).

MARKET SHARE: State Bank of India is headed by Mr. Sheri O. P. Bhatt, Chairman.SBI
currently has a market share of 17 per cent (in terms of total business) in the Indian banking
sector. The SBI Group (including subsidiaries) accounts for 25 per cent of the domestic
banking business. SBI alone enjoyed a market share of more than 19 per cent five years ago.
Even if the bank's market share increases by one per cent every year for the next two-three
years, it would be an achievement,.
HSBC BANK:HSBC Bank is a subsidiary of HSBC Holdings plc, a London based banking
.

Page 15 of 119
 Serving to empower.

giant which, according to the Forbes magazine, is the largest banking group in the world, and
the 6th largest company in the world as of April 2009.
In India, the introduction of HSBC Bank can be dated as early as the year 1853, with the
establishment of the Mercantile Bank of India in Mumbai. Currently, HSBC Group operates
through a number of its subsidiaries in India, viz. The Honking and Shanghai Banking
Corporation Limited (HSBC), HSBC Asset Management (India) Private Limited, HSBC
Global Resourcing / HSBC Electronic Data Processing
Processing (India) Private Limited, HSBC
Insurance Brokers (India) Private Limited, HSBC Operations and Processing Enterprise
(India) Private Limited, HSBC Private Equity Management (Mauritius) Limited, HSBC
Professional Services (India) Private Limited, HSBC
HSBC Securities and Capital Markets (India)
Private Limited and HSBC Software Development (India) Private Limited. The group carries
out its Commercial Banking, etc.With a loan-deposit
deposit ratio of 90%, HSBC Bank is said to be
one of the five British banks that claim
claim to have more deposits than loans. Such a high loan-
loan
deposit ratio of the bank has been able to retain the trust of its investors and customers,
HSBC Bank is well known for having established the first ATM (Automatic Teller Machine)
in India in the year 1987. As of April 2009, the bank is present in many prominent cities of
the country including Mumbai, New Delhi, Bangalore, Hyderabad, Jaipur, Chandigarh etc.

Hongkong and Shanghai Banking Corporation (HSBC) is looking to

MARKET SHARE:Hongkong
increase its market share in the credit card business in India to 10%.
Besides increasingg headcount. “Currently, it has a seven to eight per cent share in the credit
card business in the country.. The bankpresently
bankpresently have 600 employees working for wealth
management services The company has a credit card base of over 1.7m customers in India
out of the estimated size of 20m. On an year-on-year
year year basis, HSBC has been achieving a 50%
growth in the business. HSBC plans to open a branch in Lucknow by the year end. “We have
already opened two branches in Chhattisgarh and Rajasthan this year and would open
op another
branch in Lucknow,” he said.

HDFC Bank

HDFC Bank was amongst the first to receive an 'in-principle'

'in principle' approval from the Reserve
.

Page 16 of 119
 Serving to empower.

Bank of India (RBI) to set up a bank in the private sector from Housing Development
Finance Corporation Limited (HDFC), in 1994 during the period of liberalisation of the
banking sector in India. HDFC India was incorporated in August 1994 in the name of 'HDFC
Bank Limited'. HDFC India commenced operations as a Scheduled Commercial Bank in
January 1995.
HDFC India deals in varieties of products like home loan, standard life insurance, mutual
fund, securities, credit cards, etc. HDFC has branch offices in all major cities in India like
Calcutta, Chennai, Delhi, Bangalore, Hyderabad, Ahmedabad apart from HDFC Mumbai.
The bank presently has more than 468 branches over 212 cities across the
country.
Authorized capital: Rs. 450 crore
Paid-up capital: Rs. 282 crore
Equity Holds; 24.2%
listing: HDFC India has been listed on the Stock Exchange, Mumbai and the National Stock
Exchange. The bank's American Depository Shares are listed on the New York Stock
HDFC Bank India provides the following range of products:

• Savings Account
• HDFC Bank Preferred
• Sweep-In Account
• Super Saver Account
• HDFC Bank Plus
• Demat Account
• HDFC Mutual Fund
• HDFC Standard Life Insurance

HDFC India innovative services

• HDFC Phone Banking

• HDFC ATM
• HDFC Inter-city/Inter-branch Banking

Page 17 of 119
 Serving to empower.

• HDFC Net Banking

• HDFC International Debit Card
• HDFC Mobile Banking
• HDFC Bill Pay

HDFC Bank Loans

• HDFC Personal Loan

• HDFC New Car Loan and Used Car Loan
• HDFC Loan Against Shares
• HDFC Two Wheeler consumer loan
• HDFC Home Loan

MARKET SHARE: Promoted in 1995 by Housing Development Finance Corporation

(HDFC), India's leading housing finance company, HDFC Bank is one of India's premier
banks providing a wide range of financial products and services to its over 15 million
customers across hundreds of Indian cities using multiple distribution channels including a
pan-India network of branches, ATMs, phone banking, net banking and mobile banking.
Within a relatively short span of time, the bank has emerged as a leading player in retail
banking, wholesale banking, and treasury operations, its three principal business segments.
As of March 31, 2009, the Bank had a distribution network with 1,412 branches and 3,295
ATMs in 528 cities. For the quarter ended March 31, 2009, the Bank earned total income of
INR 53.65 billion (Rs.5,365.5crore) as against INR 35.05 billion (Rs.3,505.5crore) in the
corresponding period of the previous year. Net revenues (net interest income plus other
income) for the quarter ended March 31, 2009 were INR 29.66 billion (Rs.2,966.7crore), up
by 35.4% over INR 21.91 billion (Rs.2191.4crore) for the quarter ended March 31, 2008. Net
Profit for the quarter ended March 31, 2009 was INR 6.30 billion (Rs.630.9crore), up by
33.9% over the corresponding quarter ended March 31, 2008.The Bank’s total balance sheet
size increased by 37.6% from INR 1331.77 billion (Rs. 133,177 crore) as of March 31, 2008
to INR 1832.71 billion (Rs.183,271crore) as of March 31, 2009. Total deposits were INR
1428.12 billion (Rs.142,812crore), an increase of 41.7% from March 31, 2008.Total income

Page 18 of 119
 Serving to empower.

for the year ended March 31, 2009 grew by 58.2% to INR 196.22 billion (Rs19622.9crore)
over the corresponding year ended March 31, 2008.

ICICI BANK
ICICI Bank is India's second-largest bank. ICICI Bank offers a wide range of banking
products and financial services to corporate and retail customers through a variety of delivery
channels and through its specialised subsidiaries and affiliates in the areas of investment
banking, life and non-life insurance, venture capital and asset management. The Bank
currently has subsidiaries in the United Kingdom, Russia and Canada, branches in United
States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance
Centre and representative offices in United Arab Emirates, China, South Africa, Bangladesh,
Thailand, Malaysia and Indonesia. Our UK subsidiary has established branches in Belgium
and Germany.
ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and the National
Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on
the New York Stock Exchange (NYSE).
Group companies

MARKET SHARE OF ICICI:

ICICI Bank continues to be the leading private sector bank in the country. Deposits grew 80
per cent to Rs. 17,515 crore at September 30, 2001 as against Rs. 9,728 crore at September
30, 2000 and Rs. 16,378 crore at March 31, 2001. The share of ICICI Bank in total deposits
of the banking system increased to 1.52 per cent from 0.97 per cent at September 30, 2000.
Retail deposits constituted 67 per cent of total deposits, compared to 48 per cent at September
30, 2000, reflecting ICICI Bank's successful retail thrust. Savings deposits registered a robust
growth of 159 per cent to Rs. 2,186 crore from Rs. 843 crore at September 30, 2000. ICICI
Bank's customer assets (including credit substitutes) increased 80 percent to Rs. 11,409 crore
at September 30, 2001 from Rs. 6,324 crore at September 30, 2000. ICICI Bank's market
share in customer assets increased to 2.01 per cent at September 30, 2001 from 1.26 per cent
.

Page 19 of 119
 Serving to empower.

at September 30, 2000. ICICI Bank focuses on building customer relationships and using
technology as a key differentiator in its products and services. ICICI Bank continued its focus
on maintaining high quality of business with 86 per cent of incremental exposure being to
clients rated 'A' and above. The ratio of net non-performing assets (NPAs) to customer assets
was 1.41per cent at September 30, 2001 compared to 1.44 per cent at March 31, 2001. The
provisioning coverage against NPAs was 63 per cent at September 30, 2001. The Bank also
maintains a general provision of 0.50 per cent on standard assets and a provision for
operational risks at 0.50 per cent of the paid-up capital.

UPCOMING FOREIGN BANKS IN INDIA

This year few more banks is going to be added in the list of foreign banks in india.This is an
aftermath of the sudden interest shown by Reserve bank of India paving road map for foreign
banks in India, greater freedom in India.Among them is the worlds best private bank by Euro
Money Magazine ,Switzerland’s UBS.

The following are the list of foreign banks going to set up business in India:-

Royal Bank of Scotland

Switzerland’s UBS

US Based GE Capital

Credit Suisse Group

Industrial And Commercial bank Of china

Page 20 of 119
 Serving to empower.

CHAPTER-II

Page 21 of 119
 Serving to empower.

JAMMU AND KASHMIR BANK PROFILE

The Jammu and Kashmir Bank Limit

Type PRIVATE LIMITED

Founded 1938
Headquarters M.A.ROAD SRINAGAR,INDIA
No. of locations > 570 branches/offices
Industry Financial, Commercial Banks

Website http://www.jkbank.net

BREIF HISTORY:
Jammu & Kashmir Bank was founded on October 1, 1938 and it commenced business from
July 4, 1939. The Jammu & Kashmir Bank Limited has been the first of its nature and
composition as a State owned bank in the country. The Bank was established as a semi State
Bank with participation in capital by State and the public under the control of State
Government.
According to the extended Central laws of the state, Jammu & Kashmir Bank was
defined as a govt. Company as per the provision of Indian companies’ act 1956. In the year
1971, the Bank received the status of scheduled bank. It was declared as "A" Class Bank by
RBI in 1976. Today the bank has more than 570 branches across the country and has recently
become a billion Dollar Company
The Jammu and Kashmir Bank is one of the fastest growing banks in India with a network of
more than 570 branches spread across the country offering world class banking
products/services to its customers. Today the bank has status of value driven Organization
and is always working towards building trust with shareholders, Employees, Customers,
borrowers, regulators, and other diverse stakeholders for which it has adopted a strategy
directed to developing a sound foundation of relationship and trust aimed at achieving
excellence, which of course comes from the wombs of good corporate governance. Good
governance is a source of competitive advantage and a critical input for achieving excellence
.

Page 22 of 119
 Serving to empower.

in all pursuits. JK Bank considers good Corporate Governance as the SINE QUA NON of a
good banking system and has adopted a policy based on all the four pillars of good
governance-TRANSPARENCY,DISCLOSURE,ACCOUNTABILIT-y AND VALUE,
enabling it to practice trusteeship, transparency, fairness and control leading to stakeholder
delight, enhanced share value and ethical corporate citizenship. It also ensures that bank is
managed by an independent and highly qualified board following best globally accepted
practices, transparent disclosure and empowerment. Besides ensuring to meet shareholder’s
aspirations and societal expectations following the principles of management executive
freedom to drive, the bank forward without undue restraints but with the framework of
effective accountability. The excellence achieved by bank in its operations stemming from
the roots of voluntary governance has not gone unrecognized and bank has recently bagged
three very prestigious awards for fair business practices and commitment to social
obligations.
The bank had to face serious problems at the time of independence when out of its total of
ten branches two branches of Muzaffarabad and Mirpur fell to the other side of the line of
control (now Pak Occupied Kashmir) along with cash and other assets.

SOLID FINANCIAL STANDING OF JK BANK

Jammu & Kashmir Bank Ltd in India is listed in the Indian BSE and NSE stock exchanges.
The bank has a solid financial base-as evidenced by highest degree of safety rating- P1 by
rating agencies Standard and Poor, and CRISIL. The Jammu & Kashmir Bank Ltd is the
exclusive banker to the Jammu and Kashmir Government. The bank has shown four decades
of profit and paid substantial dividends to its shareholders. Jammu & Kashmir Bank Ltd is
also entrusted with the task of collecting taxes for the Central Board of Direct Taxes in
Jammu And Kashmir State.

Page 23 of 119
 Serving to empower.

CORPORATE MISSION OF J&K BANK

Our mission is to empower the people of J&K. Within the framework of this approach, we
cannot now conceive strategies for the Bank, which have little or no connection with the
people of J&K. In the past we have tried to maximize profits without directly linking it to the
impact on the welfare of the society as a whole. What we need to do now is to combine the
sensibility of the social enterprise with the form of a for-profit business.
Our overriding mission as a corporation is to use our core competency to serve and empower
the people of the state in general, and entrepreneurs in particular, rather than serving them as
an afterthought and provide the provide of J& K international quality financial service and
solutions and to be a super specialist bank in the rest of the country. The two together will
make us the most profitable bank in the country.
CORPORATE VISION
“To catalyze economic transformation and capitalize on growth”. Our vision is
to engender and catalyze economic transformation of Jammu and Kashmir and
capitalize from the growth induced financial prosperity thus engineered. The
Bank aspires to make Jammu and Kashmir the most prosperous state in the
country, by helping create a new financial architecture for the J &K economy at
the centre of which will be the J & K Bank.

Page 24 of 119
 Serving to empower.

VALUES: Customer Sovereignty, Passion for Excellence, Continuous Innovation,

Transparency & Integrity, People Orientation and Social Responsibilities are the core values
at the J& K Bank.

PHILOSOPHY: The Bank’s Corporate Governance philosophy is woven around its total
commitment to the ethical practices in the conduct of its business, while striving in the
constant quest to grow with profits and enhance shareholders value and align the interests of
the Stakeholders and Society through adoption of best international practices and standards.
The Corporate Governance policies of your Bank recognize the accountability of the Board
vis-à-vis its various constituents including customers, shareholders, investors, employees,
Government and regulatory authorities and societal responsibilities as a corporate
citizen.J&K Bank is committed to the best and transparent corporate governance practices. It
believes that proper corporate governance practices leads to effective management and
control of business, which in turn provides best value to all its stakeholders through highly
motivated personnel, visionary leadership, respect for people and society, innovation and
sound fiscal discipline.
BOARD
(Board of directors & Executive Directors)

CHAIRMAN & CHIEF EXECUTIVE OFFICER

Executive Director Executive President

GENERAL MANAGER

Page 25 of 119
 Serving to empower.

JOINT GENERAL MANAGER

DEPUTY GENERAL MANAGER

ASSISTANT GENERAL MANAGER

CHIEF MANAGER

MANAGER

Board of Directors of the Bank:

1. Haseeb A. Draboo (Chairman & Chief Executive)

2. M. S. Vera

3. G. P. Gupta

4. B. B. Visa I.A.S (Commissioner\ Secretary to Govt.)

5. Abdul Raff Family (Executive Director)

6. Mehta Ahmad (Executive Director)

7. B. L. Dora

Page 26 of 119
 Serving to empower.

8. Muar Churched Tram boo

EXECUTIVE COMMITEE

1 Haseeb A Draboo
Chairman & Chief Executive

2 A K Mehta
Executive Director & COO

3 Abdul Maid Mir

Executive Director & CFO

4 Alit Singh
Sr. President & CPO

5 G A Beige
President & Chief Strategist

6 Tafazal Husain
President & CCO

7 Sahibzada Guam Mohi-udin (not in picture)

President & Country Head-Sales

8 K K Sharma
President & CTO

9 Parvez Ahmed
President & Company Secretary
.

Page 27 of 119
 Serving to empower.

PAST PERFORMANCE:

• In the last two years, the Bank has registered a 140 per cent increase in profits.
• We have seen a 108 per cent increase in the rate of return on equity,
• A vast improvement in the Bank’s efficiency to generate profits from every invested
rupee.
• The efficiency of using the assets of the Bank to generate earnings has increased 104
per cent in two years.
• The NPA coverage ratio has been increased from 48 to 65 per cent.
• The stock price has more than doubled in the last two years. We touched a high of Rs
788 last month, showing a 288 per cent increase.

Page 28 of 119
 Serving to empower.

CSR ASPECT OF JK BANK

The Corporate Social Responsibility (CSR) of the J&K Bank seeks to recognize
obligations towards society and aims to integrate the CSR ideals into its mission for
optimizing both business and social performance. It stresses on promoting work life
balance, give attention to social and environmental concerns and host of factors that
facilitate business pursuits and accomplishment of economic goals. The CSR is not just
recognized as promulgating the Bank's own values and principles of philanthropy but also
the values and principles of all those who have a stake in it or are affected by its
operations. By supporting social cause aligned to the mission the CSR strategy
differentiates the Bank's brand and enhances its reputation. The Bank manages social
issues in the same manner as any other strategic business issues.
 The Bank also contributes significantly towards the social cause by donating
generously to the poor and needy ones for various philanthropic activities Be it victims of
natural calamity, like fire, flood, snowstorm or tsunami and disabled or patients with
serious ailment who lack reliable means of survival. The one and a half decades long
turmoil in the State of J&K has added to the agonies of people with hundreds of children
losing their parents to fend for themselves in this harsh world. The Bank realizing its
responsibility of saving the life/ future of these blooming children, adopt several of them
by providing financial support either through various orphanages where they are sheltered
or directly to the orphans by bearing their educational or other expenditureThe Bank shall
continue donations for the development of infrastructure (computers, books, TV's,
prosthetic support etc) to various NGOs, societies, trusts, institutions, etc. involved in
socio-economic development of the society.
 Heritage preservation is an important responsibility of every conscious individual,
institution or agency. The thrust areas to assist in this respect for the Bank will be
preservation of historical/religious monuments, development of tourist sites, national
properties, museums, libraries, protection of environment/ecology etc. and sponsoring
seminars and awareness camps, art and literary works, 3rd cultural activities, social
service camps, college or university students clubs etc.
 The Bank has been playing a vital role in the promotion of tourism and it is in this

Page 29 of 119
 Serving to empower.

backdrop that the Bank has been shouldering the responsibility of registering yatris for the
Shree Amarnathji Yatra through its extensive network of branches spread across the
country. The Bank puts in place special registration counters at all branches of the Bank
outside the state and some selected branches in Jammu and Kashmir State.
 Apart from above activities the Bank has been constructing/developing the public
utility service like public parks, bus stands, drinking water posts, lavatories, conveniences,
rain shelters. In addition to this, the bank organizes relief camps, service camps, night
shelters, health resorts, health clinics, disaster & calamity management centers,
rehabilitation centers etc.
JK BANK EMPHASIZES THE FOLLOWING STRATEGIES
• Increase market share in India’s expanding banking and financial services industry
by following a displined growth strategy focusing on quality and not on quantity 7
delivering high quality customer services.
Leverage the available technology platform and open scaleable systems to deliver more
products to more customers and to control operating costs.
• Maintain current high standards for asset quality through disciplined credit risk
management
• Develop innovative products and services that attract the targeted customers and
addresses inefficiencies in the Indian financial sector.
• Continue to develop products and services that reduce bank’s cost of funds.
• Focus on high earnings growth with low volatility.
• Enhances margins and boosts the virtuous cycle of savings and lending
• Increase the limit for foreign institutional investments in the bank to 40 percent
from 33 percent earlier.

UNIQUE CHARACTERISTICS & SERVICES

• J&K Bank carries out banking business of the Central Government
• Inspite of a government equity holding of 53 per cent, Jammu & Kashmir Bank (J&K
Bank) is regarded as a private sector bank

Page 30 of 119
 Serving to empower.

• J&K Bank is the one and only banker and lender of last resort to the Government of
J&K.
• Plan and non-plan funds, taxes and non-tax revenues are routed through the J&K
Bank
• J&K Bank claims the distinction of being the only private sector bank that has been
designated as agent of RBI for banking
• The services of J&K Bank are utilized for the purposes of disbursing the salaries of
Government officials
• J&K Bank collects taxes pertaining to Central Board of Direct Taxes, in Jammu &
Kashmir

Future Planning:

• To build a global brand we need to do two things – go global physically and second,
more importantly, have a unique business model, product offering and service
standards, all of which are globally recognized. We have taken initial steps to
achieve the first. As of today, after the state government, our second largest
shareholders are Foreign Institutional Investors, with a combined stake of almost 36
per cent. Some of the biggest names in the world figure in the sixty plus funds that
have invested in the Bank. The list is truly international, with funds from USA,
Europe, Singapore, Japan, Sweden, Mexico and Spain, having investments valued at
more than $300 million in the Bank As a next step in this direction, it is our plan this
year to raise money abroad. We will offer Global Depository Receipts and list the
Bank in international capital markets. This will be a landmark in our illustrious
history.
• The second way to becoming a global brand is to have a unique business model,
which is a far more formidable task. But there are great examples from small and
remote areas like ours that have produced famous brands. Godiva chocolate, made in
a small area in Belgium is a classic example. It is renowned because it has its own
unique way of making chocolates. Evian, from the foothills of French Alps, has its

Page 31 of 119
 Serving to empower.

own way of making mineral water. Harris Tweed is woven in a unique manner from
wool produced in a village of Scotland. We too have a wonderful brand in Pashmina.
Let us not forget that in 1795, Napoleon presented his wife Josphine with a
Kashmirishawl! By and large most global brands are products. What we are setting
out to do is to create a global brand in the financial services industry. To do this we
have to work out processes, products and procedures that are unique to the J&K Bank.
It has to be the J&K Bank way of doing business. Within our industry and closer
home, the Bangladesh Grameen Bank and Bank Danamon have become global
names. We don’t want to replicate their business model but we do want to emulate
their uniqueness of doing business.

SWOT ANALYSIS OF J&K BANK

Strengths:
• Good reputation, excellent growth, customer loyalty and trust.
• Wide network of branches across the state .
• A listed company on BSE and NSE with four decades of uninterrupted profitability
and dividend payments.
• World class banking services like Tele-banking,anywhere banking and excellent ATM
network.
• 98% of the total business computerized.
• Innovative in products and services supported with latest technology.
• Best practices in corporate governments.
• Management`s commitment to ethical business principles & transparency.
• Strong fundamentals.

Weakness:
• Lesser branches in the far of areas of the J&K state.
• Fewer promotions and advertisement of bank and its products.
• Bank does not have any branch outside India to enter global market.
• The benefit of it is not have not accrued fully to the Bank, the MIS is still not IT
.

Page 32 of 119
 Serving to empower.

driven
• ATM facilit y availabilit y is less
• Employee commitment to the job is missing.

Opportunities:
• The bank can play proactive role in the development of J&K economy and tourism
industry as the growth in tourism sector of the state will have positive impact on the bank’s
business.
• The bank can have tie-ups with national and international financial institutions to
offer new and upgraded services and products.
• The bank enjoys very well customer loyalty. It can diversity its business. So as not
lose the customers to the competing rivals.
• The bank can tap the potential in the under financed productive segments of the state
economy like Horticulture.

Threats:
• High level of competition from the other national banks particularly outside J&K
state.
• Policies regarding interest rates have to be flexible to compete with other banks in
this stiff competition.
• Technologically changes in the banking sector on changing rapidly. The need of the
hour is that bank should have innovation in products and services and keeps itself updated
with latest technologies.
• Customer friendly services and products should be given priority as other banks are
posing stiff competition by offering new customer tuned products and services to attract
customers of other banks.

Page 33 of 119
 Serving to empower.

CHAPTER-III

Page 34 of 119
 Serving to empower.

PRODUCTS AND SERVICES OFFERED BY JK BANK

PRODUCTS The Jammu & Bank Limited has well tailored products and services to target
the potential customers.These products have definitely helped the needy ones. Some products
have hugely helped the Kashmir valley by generating employment. Very huge no. of
products is offered by J&K Bank. Some major products have been discussed as;

Education Loan

A) Scale of finance
i) Rs.10.00 Lacs for studies in India.

ii) Rs.20.00 Lacs for studies abroad.

a)Graduate in :
BA, B.Com. B.Sc., etc. Medicine, Surgery, Engineering, Hotel Management, Design,
Architecture, Bio-chemistry, Agriculture, Veterinary etc.
b)P.G Courses in:

Business Management, Chartered or Cost Accounting, Company Secretaryship, Masters

& PhD. And various other professional courses offered by reputed Indian and foreign
universities.

Eligibility

• Should be an Indian National

• Should have secured admission to professional/technical courses through entrance
test/selection process.
• Should have secured admission to foreign universities/institutions
• Should have passed the qualifying examination for admission to the courses.

Employed person intending to improve their educational qualification and/or receive

training in modern technology in India or abroad can also be assisted under this scheme
provided training offers prospects of better placement

Security

• Personal guarantee of borrower/ 's

• Collateral security equal to amount of loan.

Rate of Interest:

Page 35 of 119
 Serving to empower.

2.5 to 5 Lakh 11.5%

5 to 10 Lakh 12.5%
10 to 20 Lakh 14.5%

Margin

• For loans upto Rs. 4 lacs - nil

For loans above Rs. 4 lacs Studies in India - 5% Studies abroad - 15%

Repayment

• Repayment Holiday/ Moratorium: Course period + 1 year or 6 months after getting

job, whichever is earlier.
• The loan to be repaid in 5 to 7 years after commencement of repayment. If the
student is not able to complete the course within the scheduled time, extension of time for
completion of course may be permitted for a maximum of two years

Optional: Customers have the liberty to decide whether they want to pay interest during
the repayment holiday or want to capitalize the same. However, an incentive in the form
of 1% concession in rate of interest shall be provided to the loanees if the interest is
serviced during the study period

CAR LOAN

The person who want to avail this facility should be;

• Permanent Employees of State / Central Government, Employees of Government /

Semi-Government Undertakings & Autonomous Bodies
• Employees of Private Limited Companies, Private Organizations, Reputed
Establishments & Employees on contractual basis with Central/State Govt,
Government/ Semi-Government Undertakings& Autonomous bodies*
• Businessmen, Professionals and self employed individuals.

• The minimum loan amount facility is Rs 75,000/- (Rupees Seventy Five Thousand
Only) and the maximum loan facility is 30 months net monthly salary of the applicant or
2.5 times net annual income. However, in case of employees of private organizations &
employees on contract basis as mentioned above, the maximum finance shall be limited to
18 times net monthly salary or 1.5 times net annual income.
• In case of married individuals, certified income of spouse can also be considered
provided the spouse guarantees the loan.

The upper ceiling on the loan amount shall be Rs 25 lacs.

.

Page 36 of 119
 Serving to empower.

Security

• Primary: Hypothecation of vehicle to be purchased & Bank’s charge to be

registered with RTO.
• Collateral: No third party guarantee required in respect of permanent employees of
State and Central Government, employees of State / Central Government Undertakings &
Autonomous bodies drawing salary through the Bank and where letter of undertaking from
employer is available.
• Guarantee of one person for all other applicants of the bank.

Rate of Interest:
12 % upto 4 Lakh
13.50 13.50% above 4 Lakh

Margin

• 10% of the Sales Invoice Value for employees of State / Central Government, State
/ Central Government Undertakings, Autonomous bodies, Platinum / Gold Current
Account holders.10% margin shall also apply to Businessmen, Professionals & Self-
Employed persons with yearly income of Rs 2,50,000/- & above.
• 20% of the sales invoice value in case of all the other cases.

100% finance shall be available to applicants if they keep a fixed deposit with the bank for
amount equal or more than the margin money & for duration not less than the repayment
period of the loan. This deposit shall be kept under lien to the Bank. Plus the processing
charges of 0.25% of Loan amount to be paid upfront subject to a minimum of Rs. 500/-.

Repayment: Flexible repayment options ranging from 12 to 84 months in equal monthly

installments The minimum loan amount facility is Rs 75,000/- (Rupees Seventy Five
Thousand Only) and the maximum loan facility is 30 months net monthly salary of the
applicant or 2.5 times net annual income. However, in case of employees of private
organizations & employees on contract basis as mentioned above, the maximum finance
shall be limited to 18 times net monthly salary or 1.5 times net annual income.

USED CAR FINANCE

The purpose of the loan is making finance available for purchase of: An old car / jeep (not
more than 5 years old). (Any make or model)

Eligibility

Page 37 of 119
 Serving to empower.

The loanees should be the Permanent employees of Government/Semi-Government

Undertakings, Autonomous bodies, Public Sector Undertakings, Private Companies or
reputed establishments. Professionals or self employed individuals, Proprietorship
Concerns. Partnership Firms, Private /Public Ltd Co.

Age Criteria
The applicant should be at least 21 years old at the time of
application, and below 58 years of age at the time of maturity
Salaried of the loan.
Individual
*For institutions, where retirement age is 60 years, the upper
age limit shall be 60 years.
Self- Employed Any Proprietor, Partner, Professional or director above 21
Individual years of age but below 65 at the time of the loan's maturity
Partnership Firm NA
Private/Public Ltd
NA
Co.
Minimum period of current employment/existence.
The applicant must have been in current service for at least 3
Salaried years.* Only 2 yrs for Individuals drawing salary through our
Individual branches & where letter of undertaking from employer is
available.
Self- Employed
At least 3 years in business.
Individual
Partnership Firm Should have been in existence for at least 3 years.
Private/Public Ltd Limited Companies should have been in existence for at least
Co. 3 years.

Rate of interest:

REPAYMENT PERIOD RATE OF INTEREST

Upto 4 years 13.25% p.a
Above 4 years and upto 6 years 13.75% p.a

Page 38 of 119
 Serving to empower.

Margin

• 25% for vehicles having age less than 3 years.

• 30% for vehicles having age of 3 years and above upto 5 years

Maximum loan amount:2.5 times of the net annual income or 15 lacs, whichever is
lower. If married, the spouse's income also considered provided the spouse
guarantees the loan. Loan amount for used vehicles shall be subject to a maximum
limit of Rs. 15 lacs.

Repayment period

• Maximum repayment period of 72 months for vehicles having age less than 3
years.

Maximum repayment period of 48 months for vehicles having age of 3 years &
above to 5 years

Security

remarry: Hypothecation of vehicle to be purchased.

Collateral: No third party guarantee required in respect of employees drawing salary

through our branches & where letter of undertaking from employer is available. Third
Party Guarantee of two persons for all other applicants. Third Party Guarantee may be
waived off in case of existing account holders having good reputation. Instead Post Dated
Cheques may be accepted.

Repayment

Prepayment of any amount allowed any time after a period of 6 months at prepayment
penalty @2% for the amount prepaid

Prepayment of any amount allowed any time after a period of 6 months at prepayment
penalty @2% for the amount prepaid.

valuation of the vehicle

• The value of the vehicle will be ascertained on the basis of present market value of
the new car of same variety & configuration less the depreciation, which shall be as
follows

Page 39 of 119
 Serving to empower.

% Of Depreciation for
Age of the vehicle
fixing value.
Not exceeding 6 months. 5%
Exceeding 6 months but not exceeding 1 year. 15%
Exceeding 1 year but not exceeding 2 years. 20%
Exceeding 2 years but not exceeding 3 years. 30%
Exceeding 3 years but not exceeding 4 years. 40%
Exceeding 4 years but not exceeding 5 years. 50%

COMMERCIAL VEHICLE FINANCE

The finance under this scheme shall be available for purchase of Used Commercial
vehicles like Used Trucks, Tippers, Buses, Mini Buses, light commercial vehicles, pick
ups, three wheelers (cargo), auto rickshaws, etc of any approved make or model. The
vehicle should not be more than 6 years old as on the date of finance. The product shall
also cover takeover of loan accounts from our bank or from any other banks/ financial
institutions, provided such loan account is running satisfactorily without any default in
payment of installments as per the fixed repayment schedule.

Eligibility Criteria

• Individuals / Proprietorship/partnership firms & Limited companies owning /

operating or proposing to own / operate transport vehicles for carrying passengers or goods
on hire.
• The borrower should have sufficient net worth to pay for the margin and initial
recurring expenses. In case where a borrower does not meet this requirement, a co-
borrower having sufficient net worth can be included.
• Ownership of a pre-owned vehicle is not mandatory.
• Minimum age of Applicant: 21 years
• Maximum age of Applicant at loan maturity: 65 years
• Minimum period of existence in case of firms & companies: 2 years in business.
• Commercial Driving License (for self-operating by individuals)

Commercial Loan Limit Upto (Amount

Margin
Vehicle Loans in lacs)
Under priority 8.50 15%
sector Micro (Service)
Enterprises Upto and inclusive of Rs
15%
10.00 lacs

Page 40 of 119
 Serving to empower.

Small (Service)
Above Rs 10.00 20%
Enterprises
Under 200.00 25%
Non –priority
sector Above 200.00 30%

Margin is calculated on the project cost of vehicle (chassis, body building & initial
insurance) excluding registration charges. The borrower will be required to deposit the
entire margin upfront with the bank to be released subsequently along with the loan
component directly in favour of the supplier/fabricator to ensure proper end use of funds

Repayment

Maximum repayment period of 72 months including a initial moratorium of 2 months.

The repayment shall be in Equal Monthly Installments.

Security

• Primary:
Hypothecation of vehicle to be purchased. Banks name as hypothecate to be got noted in
the books of the RTO and also the Registration Certificate.
• Collateral:

Upto 30 lacs 3rd party guarantee of 2 persons

Above 30 lacs Mortgage of immovable property of value equal to at
least 50% of the loan amount.

UP Front fee

• 0.20% upto an amount of Rs 50.00 lacs. Minimum Rs 500/-

0.50% above Rs 50.00 lacs to Rs 100.00 lacs.
• 1.00% above Rs 100.00 lacs Maximum Rs 10.00 lacs.

Rate of interest

Rate of Repayment upto 3 Repayment 3 to 6

Interest years years
Under Micro (Service) PLR-1.50% PLR-1%
priority Enterprises PLR –1.50% PLR-1%

Page 41 of 119
 Serving to empower.

sector

The
Small (Service)
bank PLR-1% PLR-0.50%
Enterprises
char
ges Above Rs 10.00 lacs PLR PLR+1.25%
the
interest monthly on daily outstanding balances. Penal Interest @ 2% p.a. over and above
the contract rate where the installment is overdue beyond 2 months. The penal interest will
be charged on the overdue amount for the overdue period. No interest repayment will be
allowed for pre-payment before three years of loan of original tenure of three to six years.

CONSUMPTION LOAN

Features

Disbursed in cash .No questions are asked about its end-use and revolving type facility, as
full limit can be restored on request of the borrower subject to the following. At the time of
reinstatement of the limit, applicant must have sufficient remaining years of service so that
loan is repaid within the borrowers remaining years of service. The borrower has not had
more than two installments in arrears on any point of time during currency of loan.
Borrower needs to furnish an undertaking from drawing and disbursing officer for
intimating the bank about their transfer and noting that outstanding from the bank and the
monthly installment obligation in their LPC forwarded to the next drawing and disbursing
authority.

Eligibility

Permanent employees of State, Central Government, autonomous bodies, corporates,

public & private sector undertakings having minimum of 3 years confirmed service

Loan amount

30 months gross salary or Rs 7.00 lacs whichever is less

Margin-Nil

Repayment period

84 monthly installments or remaining period of service whichever is lower.

HELP TOURISM ( FOR KASHMIR VALLEY ONLY)

Page 42 of 119
 Serving to empower.

This is an exclusive scheme providing hassle free credit for the conversion of residential
properties into tourist guest houses (renovation/refurbishment only)
Eligibility

• The house should e owned by the borrower, suitably located and having a
motorable approach. The house should not be more than 15 years old.
• Proper registration with the Tourism Department, J&K Government, and
permission for the conversion/ renovation/ refurbishment from Municipality/ concerned
authority, wherever necessary. - The guest house should be managed by the owner himself.
- The prospective borrower required to submit proper estimates/project report for the
renovation/refurbishment plan for the proposed guest house to assess the viability. T

The renovation/refurbishment should be completed within a period of three months from

the date of first disbursement. - The existing hotels/guest houses already registered with
the Tourism Department not come under the purview of this scheme.

Quantum of loan

It shall depend on actual requirement subject to a maximum of Rs.50,000/= per room and
Rs.10.00 lacs per guest house. The quantum of finance has been fixed after determining
the average requirements for such conversion.

Components of project cost

Cost on account of renovation, painting, bedding, furniture, dinning table, flooring,

crockery, cutlery, color television etc., required for renovation/refurbishing of the house.

Security

• Primary: Hypothecation of all furniture fittings and other movable assets of the
guest house.

Collateral: Upto Rs.2.00 lacs and Third party guarantee of two persons having sufficient
means to withstand the liability. Above Rs.2.00 lacs: Mortgage of the house
property/guest house.

Margin:30%

Interest: only PLR(15%)

Moratorium: The moratorium period is allowed for 6 months

Repayment

Page 43 of 119
 Serving to empower.

The loan shall be repayed in 60 equal monthly installments after the initial moratorium.
The interest during moratorium should be inbuilt in the term loan.

Insurance

The securities /assets charged to the bank should be got comprehensively insured to
safeguard to the interests of the bank.

FRUIT ADVANCES LOAN(APPLE)

The objective of the scheme is to provide adequate and timely credit for comprehensive
requirements of Apple growers to take care of Production & Marketing Costs involved in
case of their own orchards and also for those acquired on lease.

Nature of facility

Cash credit/SOD

Purpose

• The facility shall be available for meeting the following costs: Production Costs,
which includes:
o Cost of Fertilizer
o Cost of Fungicides, Pesticides, etc.
o Cost of Fertilizer/Fungicides Application & Watch and Ward Marketing
o Costs, which includes:
o Cost of Shooks
o Cost of Packing Material

Cost of Picking, Packing & Grading Carriage Charges.

Eligibility

All Persons engaged in Production & Marketing of Apples, including the Small &
marginal farmers

Quantum of finance

• The amount of finance to be provided under the scheme is based on the following
estimate worked out for an acre of apple orchard.
• Production Cost. 40,000
• Marketing Cost 1,01,000.
• Post Harvest Maintenance cost * 9,000.
• Total costs. 1,50,000.

Page 44 of 119
 Serving to empower.

The post harvest maintenance cost/finance disbursed in the month of Oct/Nov every year.

Security

• Primary: Hypothecation of fruit crop

Collateral: Upto 2 Lacs Third Party Guarantee of 2 persons Above 2 Lacs Mortgage of
own orchards/ Mortgage of equivalent immovable propert.

Processing charges

• Rs 400/- (upfront in case of Third Party Guarantee)

Rs 500/- (upfront in case of Mortgage)

Margin; 25%

Rate of interest subject to charge

Loan Amount Interest rate

Upto Rs.0.50 lacs PLR-2%
Above Rs.0.50 lacs & upto Rs. 2.00 lacs PLR-1%
Above Rs.2.00 lacs & upto Rs. 5.00 lacs PLR-0.50%
Above Rs.5.00 lacs & upto Rs. 20.00 lacs PLR

ZAFFRON FINANCE

The objective of the finance is to provide adequate and need based financial assistance for
cultivation of saffron. The term loan shall cover the entire plantation & production costs
including plant material, agricultural machinery, labour, etc.

The nature of facility is agricultural term loan

Open to;

All saffron growers including small, marginal & large farmers including contract farmers
engaged in cultivation of saffron or intending to commence the cultivation of saffron.

Quantum of finance

The unit cost, Margin & maximum amount of finance inclusive of the interest during
moratorium (capitalized) shall be as follows

Page 45 of 119
 Serving to empower.

For loans upto Rs 2 Lacs

a. Unit b. Unit Cost c. Unit Cost d. Interest @ e. f. Loan g. Loan amount

Size excluding inclusive of during Margin Amount inclusive of
(Land Capitalized capitalized moratorium*. @ 20% capitalized
Holding) Interest. Interest. of b. Interest.
1 Kanal 28,500 32,305 3805 5700 22,800 26,605

For loans above Rs 2 Lacs

a. Unit Size b. Unit Cost c. Unit Cost d. Interest @ e. f. Loan g. Loan

(Land excluding inclusive of during Margin Amount amount
Holding) Capitalized capitalized moratorium*. @ 20% inclusive of
Interest. Interest. of b. capitalized
Interest.
1 Kanal 28,500 32,692 4192 5700 22,800 26,992

Minimum unit size to be financed under the scheme will be 0.5 Kanals. The unit-sizes
indicated in the Tables-above are for I Kanal of land. However, in actual cases the unit size
can be of varied sizes. The unit cost of the farms should therefore be calculated in
proportion to the unit cost prescribed in the Tables.

• For the purpose of loan limit, the amount of Interest charged by the bank during
moratorium is calculated on worst –case scenario assuming that 1st & 2nd installment
during year 1 are disbursed during April. However, in practice branches shall calculate the
interest during moratorium on actual disbursement basis.

Minimum - Rs 0.06 Lacs

Maximum - Rs 10.00 Lacs.

Security

Amount of Loan Security to be furnished

Hypothecation of the Asset created.Third Party
Upto Rs 0.50 lacs.
Guarantee of one person.
Above Rs 0.50 lacs upto Hypothecation of the Asset created.Third Party
Rs.3 lac/- Guarantee of two persons
Above Rs 3 lacs to Rs 10 Hypothecation of the Asset created
lacs. Mortgage of unencumbered immovable property.
.

Page 46 of 119
 Serving to empower.

Disbursement

The loan facility sanctioned under the scheme shall be disbursed as follows:
a) 90% of loan amount including Margin but excluding amount earmarked for interest
charged during moratorium to be disbursed in 2 installments in the Year 1 during the
months of April –August as per the requirements of the grower.
b) 10% of loan amount including Margin but excluding amount earmarked for interest
charged during moratorium to be disbursed during April-August of 2ndyear
c) Amount earmarked for interest to be released on yearly basis for servicing of interest
during moratorium. Interest for remaining period of moratorium, i.e. 8 months shall be
applied as well as disbursed at the end of the moratorium period.

Moratorium

There shall be an initial moratorium of 20 months from the date of disbursal of loan.
Interest for the moratorium shall be sanctioned.

Repayment of loan

The bank provides with two options for the repayment of loan.these are:-

Option 1 : Interest for the moratorium period shall be capitalized. At the end of the
moratorium period, the outstanding loan amount inclusive of capitalized interest shall be
paid in three yearly installments in the ratio of 20, 35 & 45% with the first installment to
be paid immediately after completion of the moratorium period. Interest for the period
after initial moratorium shall be paid along with the annual installments.

Option 2 : This option shall be similar to the first option except for the difference that here
a borrower shall pay the interest portion every month after the moratorium period till the
liquidation of the loan at the time of payment of 3rd yearly installment

Rate of interest

Loan Amount Interest rate

Upto Rs.2.00 lacs PLR -3.0% i.e 11.50%
Above Rs.2.00 lacs & Upto Rs. 10.00 lacs PLR -2.0% i.e 12.50%
The interest shall be on fixed basis and shall be compounded annually. Interest
application shall be on yearly basis.

Page 47 of 119
 Serving to empower.

SCHEMES OF J&K BANK

J&K Bank offers a huge number of schemes.These includes
SUPER EARNER DEPOSIT SCHEME
The scheme has been designed to provide customers with the option of depositing
under variable interest rate.. The floating rate of interest applicable to the deposit is usually
higher than fixed rate deposits and is reviewed after periodical intervals depending Upon the
market conditions of interest is re-set it shall apply to the deposit from the date of change
notified by the Bank for the residual period of the deposit till its maturity or next review
whichever is earlier. Under the Scheme an amount of Rs.1 000/- and above in multiples of
Rs.100 for period of one year and above up to 10 years can be placed with the Bank.
The scheme carries simple rate of interest and if desired can be payable to the
depositor quarterly.
SUPER REINVESTMENT DEPOSIT SCHEME
The scheme will work exactly on the analogy of Super Earner Deposit Scheme with the only
difference that under this scheme interest shall be compounded quarterly and payable with
principle on maturity.
The other features of the scheme will be the same as that of Super earner Deposit
Scheme.
CASH CERTIFICATE SCHEME
Features
It is a fixed deposit scheme. But the only difference with the traditional fixed deposit scheme
is that the minimum period of deposit is one year and the amount to be deposited should be in
multiples of Rs.l00/=. Interest calculations
The interest on the deposit is compounded quarterly, which ensures more and more
return on the deposit payable on maturity.
Loan facility
Loan can be availed against the deposit upto 90 per cent of the amount
deposited with the bank under this scheme.

Page 48 of 119
 Serving to empower.

CHILDCARE DEPOSIT SCHEME

Main Attractions
The main attraction of the scheme is the accidental insurance cover, which will be now
operational from the date of opening of account. Further, the sum assured is linked to the
amount of monthly installment in the account in the following manner:
Monthly Installment Sum Assured
Rs. 100 - Rs. 400 Rs. One Lac
Rs. 500 - Rs. 900 Rs. Two lacs
Rs. 1000 and above Rs. Three lacs
The Depositor/Guardian/Parent maintaining one or more accounts under the scheme in one or
more branches in his own name/name of the same or different wards/minor children will be
entitled to the insurance benefits under each cover granted with each deposit. However, the
amount of claim payable shall not exceed 60 months income of depositor/parent/guardian as
applicable, under all policies.
The attaining of age of majority by minor will not affect the benefits entitled to him or her
under the insurance cover and insurer will be liable for all claims in respect of such accounts
subject to a maximum of 60 months income of the depositor/parent/guardian as applicable
under all policies.
Payment before Maturity
In case any depositor desires payment before maturity it will be allowed but the penalty shall
be 2% instead of 0.25% if the deposit has remained for less than 3 years with the bank but
after 3 years deposit will be dealt as per the norms in vogue for other term deposits.
Loan against Deposit
Loan facility can be provided after deposit entry into the 2nd phase, bank can allow loan not
exceeding 90% of the amount accumulated at the time of first phase.

FIXED DEPOSIT SCHEME

It is a term deposit that pays interest at the end of each calender quarter. It is suited to the
persons who wish to keep their invested money intact and require quarterly income to meet
their requirements. It can be opened with a deposit of Rs.I00/= and above for different

Page 49 of 119
 Serving to empower.

maturities ranging from 7 days to 10 years.

Who Can Open?
A person in his/her name.
More than one person in their joint names.
Minor through guardian or himself if above 14 years of age.
Blind Persons.
Associations, clubs, Societies, Trusts etc.
Loan Facility
Loan can be availed against the Fixed Deposit up to 90 per cent of the amount deposited with
the Bank.

FLEXI DEPOSIT SCHEME

OBJECTIVE
The Flexi Deposit Scheme (FDS)
Designed to allow the depositor automatic access to ob1ain credit facility against the
deposit account up to the 90 per cent of the Principal and interest accrued amount without
making any separate requisition for the same and without execution of any documents.

SALIENT FEATURES
Under the scheme deposit of Rs.l000/- and above in multiples of Rs.l00/shall be accepted by
the bank. The bank shall hold the deposit in the Re-investment plan.
TERM OF DEPOSIT
The deposit can be accepted for a period of six months to ten years.
RATE OF INTEREST
The amount invested in the scheme shall attract rate of interest prescribed by the bank on
domestic term deposits from time to time.
LOAN AGAINST DEPOSIT
The scheme has built in mechanism to allow automatic loan drawls against the security of the
deposit and interest accrued thereon without any additional documentation The credit facility
shall be called "Flexi Credit Facility A/C".

Page 50 of 119
 Serving to empower.

►The withdrawals in the "Flexi Credit Facility Account shall be permitted through Debit
notes/letter of authority.
► Interest rate of 2 per cent above the deposit shall charged on flexi Credit facility.
►The limits in the Flexi Credit Facility account shall be revised with each quarterly accruals
of interest on the deposit.
►The depositor shall be entitled to raise the Flexi Credit facility at the issuing branch of the
F1exi Deposit Receipt only.

GIFT CHEQUE SYSTEM

► Gift Cheques are available in the denominations of Rs.I0l, Rs.201, Rs.501, Rs.I00I and
Rs.5001 in MICR format.
►The beneficiary of the Gift Cheque can invest the amount of the cheque in any of the Term
Deposit schemes of the bank. In that case, as a value addition, the date of issue of Gift
Cheque could be given as effective date of the deposit. Under the Term Deposit Scheme to
entitle the beneficiary to earn interest from the date of purchase of Gift Cheque.
►At the formal request of the original purchaser, Gift Cheques can be paid by cancellation at
the issuing branch against surrender of the original one after taking normal procedures.

VALIDITY
The Gift Cheque shall be valid for a period of six months only from the date or its issue.
However, it can be revalidated for a further period of 3 months to raise the total tenure to 9
months.
PAYMENT
Gift Cheque is payable at any branch and at par.

MILLENNIUM DEPOSIT SCHEME

OBJECTIVE
The scheme is aimed at to enable the depositor to draw a part of the deposit placed with the
hank for a fixed period, in the event of an exigency.
SALIENT FEATURES

Page 51 of 119
 Serving to empower.

Under the scheme a deposit of Rs.1 0001- and above but in the multiples or Rs.500/- can he
accepted by the bank. The bank shall hold deposit in the units or Rs.500/- each.
TERM OF DEPOSIT
The deposit can be accepted for a period of six months to ten years.
RATE OF INTEREST
As applicable from time to time.

WITHDRAWAL OF UNITS DURING THE TERM OF THE DEPOSIT

Under the scheme the depositor shall be at liberty to withdraw any number of units during the
currency of the deposit but not before completion of 45 days. However, balance in the
account in no case should fall below the minimum prescribed limit of Rs.l000/-. The value of
number of units withdrawn during the term of deposit shall attract the rate of interest
applicable for the period it has actually remained with the bank with quarterly rests having
compounding effect.

PREMATURE PAYMENT
At the discretion of the bank, depositor can seek withdrawal of the entire amount of the
deposit in one lump or in units before the completion of the term. In such case the deposit
shall attract interest rate applicable for the period it has remained with the bank less by 0.25
per cent for deposit up to Rs.5.00 lac and 0.50 per cent above Rs.5.00 lacs. However, this is
subject to guidelines issued by the bank from time to time.
LOAN FACILITY
The depositor can avail loan facility against the value outstanding units and the accrued
interest with a minimum margin of l0 per cent. The interest chargeable in such loan account
is 2 per cent above the contracted rate on the deposit. However, these are subject to norms as
prescribed by bank from time to time.

DEPOSITERS PENSION SCHEME

FEATURES
The scheme has been specially devised for persons who do not enjoy pension benefits either

Page 52 of 119
 Serving to empower.

from their present employers or their present business.

Under this scheme, a depositor can earn a regular income by way of pension every month
and also a fund to fall back upon in case of urgent need.
Under this scheme, a depositor can deposit any sum in multiples of Rs.50/- for periods of 84,
105 or 111 months and from the commencement of 86th, I07th and I 13the month, the
depositor will receive a regular monthly pension.

MEHENDI DEPOSIT CERTIFICATE

BACKCROUND AND MATURITY SLABS:
The scheme has five maturity slabs of 5,7,10,12 and 15 years. The depositor is required to
choose any of the maturity slabs. The amount payable under the scheme is predetermined as
Rs.25,000/-, Rs.50,000/- and Rs.l,00,000/-. However, the amount or deposit will vary
depending upon period and interest rate applicable at the time or making the deposit.
therefore the period, lesser will be the amount to be deposited.
III. PAYMENT BEFORE MATUTRITY:
The deposit can be paid before maturity without levying any penalty.
IV. LOAN AGAINST DEPOSITS:
Loan facility as admissible under other term deposit schemes shall be allowed under this
scheme.
V. TARGET GROUP:
The target group will be young parents securing an amount for marriage or education of a girl
child. It has been seen that at the time of birth of girl child or thereafter every parent is for a
lookout to save some amount for marriage or education of the girl child. We can exploit this
segment by strategic marketing efforts
VI. MAIN ATTRACTION:
The scheme provides for an in-built mechanism of Personal Accidental Insurance Cover. The
accidental cover shall be equivalent to the amount payable under the scheme to he selected
by depositor and shall remain in force till maturity or the deposit. The insurance cover shall
be available to depositors free of charge.The only difference being that in the instant case
sum assured is equal to amount payable

Page 53 of 119
 Serving to empower.

GENERAL INSURANCE
MOTOR VEHICLE INSURANCE:
INTRODUCTION
Technology has made our daily life simpler in various ways. Motor Vehicle is an invention
which has made daily commuting easy. It is convenient and fast and saves our time. Though
it is easy to own a vehicle it is expensive maintaining a motor vehicle especially in case of
damage caused to the vehicle due to some unavoidable circumstances or accidents. Bajaj
Allianz’s Motor Vehicle Policy helps to maintain vehicle in such situations.
WHAT DOES THE BAJAJ ALLIANZ MOTOR POLICY COVER?
The policy offers the following scope of over:
Section 1: undertakes to reimburse the expenses incurred for:
Repair / replacement of the parts of the vehicle.
To pay the market value of the vehicle in case of a total loss provided that the originating
cause of such damage is an accident, including theft
Section 2: Is compulsory it covers the legal liability to third party personal injury and
property damage arising out of an accident involving the insured vehicle.
SHOP KEEPERS:
INTRODUCTION:
This policy is specifically designed to all the risks and contingencies faced by a shopkeeper.
It provides protection for the property and the interests of the insured and his partners in the
business venture.
COVERAGE
Fire & allied perils:
. This policy safeguards against the losses that can arise due to a fire or risks that are stated
below:
Fire Lightning Explosion/ Implosion Aircraft Damage Riot, Strike, Malicious Damage
Storm, Cyclone, typhoon, Tempest, Hurricane, Tornado, Flood and Inundation Impact
Damage Subsidence and Landslide including rock slide Bursting and/or overflowing of
Water Tanks, Apparatus and pipes Missile testing operations Leakage from Automatic

Page 54 of 119
 Serving to empower.

Sprinkler Installations Bush Fire Earthquake EXCLUSION:

It does not cover Katcha constructions, money & valuables. Any loss or damages arising due
to Terrorist activities is not covered
NOTE: Terrorism Cover Extension can be opted for extra premium.

LIFE INSURANCE POLCIES

MET BHAVISHYA:
A) Flexible money-back plan
It’s only obvious then, that one will want nothing but the very best for them. Unfortunately,
it’s not always possible for everything to go perfectly according to plan. Education, for
instance, is getting increasingly expensive. It is more so as the children grow up or when they
want to pursue specialized courses from premier institutions. It’s been estimated that at the
current inflation rate of 6% p.a., the cost of college education will double over the next 12
years. It’s at times like these that one wishes that he had access to a friendly financial advisor
and assured financial resources. Of course, insurance would ensure a secure future for ones
child. But not all policies are designed with ones specific needs in mind. That’s what makes
Met Bhavishya so different and so special. A parent will be life assured under this plan, the
benefits are so designed as to meet their child’s (named child) expenses at points of time
where funding is required.

METLIFE INDIA
In India, MetLife is partnered with Jammu & Kashmir Bank, M Pallonji & Co. and other
private investors. MetLife India is headquartered in Bangalore with offices in 7 major India
cities and an additional 1000 outreach points through its channel partners.
MetLife India is committed to building a highly professional agency distribution system
dedicated to helping its customers plan for their financial security with customised solutions.
MetLife India is driven by the principles of uncompromising integrity and the highest level
of professionalism. Its mission is to work with utmost, fairness and financial prudence in all
its dealings.

Page 55 of 119
 Serving to empower.

METLIFE INC.
MetLife, ranked 37 on the fortune 500 list (April 2003), is one of the world’s largest,
strongest and most respected financial Organisations. MetLife has been delivering reliable,
high quality service to customers since 1868.
MetLife is the #1 insurer in the US with $2.4 trillion of life insurance in force (as of
December 2002). MetLife companies serve approximately 12 million individuals in the US
as well as the employees of the 88 of the Fortune 100 companies. Headquartered in New
York, MetLife operates through its affiliates and subsidiaries in 12 countries across the
Americas, Europe and Asia.
Statutory Warning:
Section 41 of the Insurance Act, 1938 states:
No person shall allow or offer to allow, either directly or indirectly, as an inducement
to any person to take out or renew or continue an insurance in respect of any kind of risk
relating to lives or properly in India, any rebate of the whole or part of the commission
payable or any rebate of the premium shown on the policy, nor shall any person taking out or
renewing or continuing a policy accept any rebate, expect such rebate as may be allowed in
accordance with the published prospectus or tables of the insurer.
Any person making default in complying with the provisions of this section shall be
punishable with fine which may extend to five hundred rupees.

B) PAR ENDOWMENT:
THE IDEAL POLICY FOR THOSE WHO:
Want to share in the future prosperity of the company by getting reversionary and terminal
bonuses on the face amount of the policy , Want their children’s predictable expenses met
through careful planning , Want to pay a affordable premiums , Want tax advantages
HOW DOES THE POLICY WORK?
Met junior (Par Endowment) offers the following guarantees: BONUS – Face amount
increases in line with the reversionary bonus rates, as and when declared by the Company
and strong probability of a terminal bonus after 10 years Life insurance coverage for the term
of the policy Fixed premium amount Choice of policy terms – 15, 20, 25, or 30 year . At

Page 56 of 119
 Serving to empower.

the same time help inculcate a savings culture in children so that even ones grandchildren
benefit.

C) MET Mortgage Protector SP:

Single Premium Mortgage Protector Plan
THE IDEAL POLICY FOR THOSE WHO
Want to ensure dependant aren’t burdened with debt with in case of untimely death of
policyholder
Want to pay affordable premiums
Want tax advantages
HOW DOES THE POLICY WORK?
MET Mortgage Protector SP offers the following guarantees:
Coverage for the term of the policy
The amount of coverage will be equivalent to the outstanding loan at the beginning of each
policy year
The policy schedule clearly shows the amount of coverage
Fixed premium amount
Single premium
There is guaranteed partial refund of this single premium in the event of prepayment of
mortgage

D) MET 100
Limited Pay Whole Life Insurance
THE IDEAL POLICY FOR THOSE WHO:
Want Lifetime protection, pay affordable premiums Want access to cash value of the policy
Want tax advantages
HOW DOES THE POLICY WORK?
MET 100 offer the following guarantees: Coverage until the age of 100 Fixed premium
amount Fixed payment period (choose your term of payment –15, 20 or 25 years based on
current age) Cash value of the policy during the life of the policy ones legacy is protected

Page 57 of 119
 Serving to empower.

until the age of 100 or until death – whichever comes first and on the 100th birthday gives
the insurance amount.

E) MET Platinum (ENDOWMENT):

(Participating Endowsment Assurance for face amounts above Rs. 3 lakh)
THE IDEAL POLICY FOR THOSE WHO
Want to share in the future prosperity of the company by getting reversionary and terminal
bonuses on the face amount of the policy
Want to pay the lowest premiums in this class
Want protection
Want access to cash value of the policy
Want tax advantages
HOW DOES THE POLICY WORK?
MET Platinum (Endowment) offers the following:
Lowest premiums in its class
BONUS – Face Amount increases in line with the Reversionary bonus rates, as and when
declared by the Company and strong probability of a terminal bonus after 10 years
Guaranteed face amount
Coverage for the term of the policy
Fixed premium period (choose your term of payment – 15, 20, 25 or 30 years based on
current age)
Cash value of the policy – during the life of the policy, after the first 3 years – (90% of cash
value can be taken as loan on approval)
The family can enjoy support, live with the peace of mind. If the unforeseen happen during
the term of the policy, family is looked after.

Page 58 of 119
 Serving to empower.

SREVICES:
JK bank offers incredible services to its customers. These include;
SUPPORT SERVICES
• Anywhere Banking
• Internet Banking
• SMS Banking
• ATM Services
• Debit Cards
• Credit Cards
• Merchant Acquiring
DEPOSITORY SERVICES
• Demat Account
• Other Services
THIRD PARTY SERVICES
• Mutual Funds
• Insurance Services - Life & Non Life
• Remittance Services
OTHER SERVICES
• Real Time Gross Settlement (RTGS)
• National Electronic Fund Transfer (NEFT)

DEPOSITORY SERVICES SCHEME OF J AND K BANK

• Dematerialisation (Demat)
• Stock Broking through INVESTMART an initiative of ILFS
• Depository
• Depository Participant
• sMarket transaction
• Off-market transactions
• Pledge of securities
• Rematerialisation (remat)

Page 59 of 119
 Serving to empower.

CREDIT CARD OF JK
Initially there are three types of Credit Cards issued by Jammu and Kashmir Bank. They are
as mentioned below:
• Gold Card
• Silver Card
• Blue Card
All the above cards is also available with photo along with a family/add on Cards. The Card
is accepted by all those Merchant Establishments who honour MASTER cards. ATMs linked
with MASTER cards accept JK Bank Credit Card.
Charges/fee for issue of Cards:

Nature of Fee Blue Card Silver Card Gold Card

Entrance Fee Nil Nil Nil

Annual Fee Rs. 500. Rs.700. Rs.1000.

Renewal Fee Rs. 300. Rs.500. Rs.700.

Add-on Card Rs.200. Rs.300. Rs.500.

Page 60 of 119
 Serving to empower.

FINANCIAL STATEMENTS OF JK BANK:

The Financial statements of JK Bank can give us the handful ideas about the present status of
the organisation.
BALANCE SHEET
Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05 Mar ' 04
Sources of funds
Owner's fund
Equity share capital 48.49 48.49 48.49 48.49 48.25
Share application money 28.10 - - - -
Preference share capital - - - - -
Reserves & surplus 2,232.34 1,960.24 1,750.98 1,616.91 1,545.49
Loan funds
Secured loans - - - - -
Unsecured loans 28,593.26 25,194.29 23,484.64 21,644.97 18,661.38
Total 30,902.19 27,203.03 25,284.11 23,310.37 20,255.12
Uses of funds
Fixed assets
Gross block 471.32 433.63 412.23 381.45 331.66
Less : revaluation reserve - - - - -
Less : accumulated depreciation 289.10 256.94 223.80 184.88 141.46
Net block 182.22 176.69 188.42 196.57 190.20
Capital work-in-progress 9.79 6.76 6.29 5.83 5.87
Investments 8,757.66 7,392.19 9,002.34 9,089.23 8,451.10
Net current assets
Current assets, loans & advances 486.47 377.19 481.41 493.12 356.89
Less : current liabilities &
1,102.02 823.31 900.94 850.30 653.63
provisions

Page 61 of 119
 Serving to empower.

Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05 Mar ' 04
Total net current assets -615.55 -446.12 -419.53 -357.18 -296.74
Miscellaneous expenses not written - - - - -
Total 8,334.12 7,129.52 8,777.53 8,934.45 8,350.44

PROFIT LOSS ACCOUNT

Operating income ,603.50 2,002.79 1,737.72 1,415.07 1,795.64
Expenses
Material consumed - - - - -
Manufacturing expenses - - - - -
Personnel expenses 225.77 220.07 192.40 170.86 168.38
Selling expenses 7.72 4.94 3.06 4.53 5.17
Adminstrative expenses 167.96 185.86 192.87 133.75 112.48
Expenses capitalized - - - - -
Cost of sales 401.45 410.87 388.33 309.15 286.04
Operating profit 578.25 460.44 306.86 152.93 608.24
Other recurring income 56.51 38.62 41.23 35.02 27.31
Adjusted PBDIT 634.76 499.06 348.09 187.95 635.55
Financial expenses 1,623.79 1,131.48 1,042.53 952.99 901.36
Depreciation 32.16 33.14 38.92 43.42 36.80
Other write offs - - - - -
Adjusted PBT 602.60 465.92 309.17 144.53 598.75
Tax charges 218.16 140.71 74.84 20.86 170.00
Adjusted PAT 360.00 274.49 178.29 123.03 406.33
Non recurring items - - - -7.96 -
Other non cash adjustments - - - - -
Reported net profit 360.00 274.49 178.29 115.07 406.33

Page 62 of 119
 Serving to empower.

Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05 Mar ' 04
Earnigs before appropriation 360.00 274.49 178.29 115.07 406.33
Equity dividend 75.14 55.75 38.78 38.78 48.50
Preference dividend - - - - -
Dividend tax 12.77 9.47 5.44 5.07 6.21
Retained earnings 272.09 209.26 134.07 71.22 351.62

SHAREHOLDING PATTERN
AS ON:

30-06-2009 31-03-2009 31-12-2008

Face value 10.00

No. Of % No. Of % No. Of %

Shares Holding Shares Holding Shares Holding
Promoter's holding
Indian Promoters 2577526 53.17 2577526 53.17 2577526 53.17
Sub total 257756 53.17 2577526 53.17 25775266 53.17
Non promoter's holding
Institutional investors
Banks Fin. Inst. and
248581 0.51 251581 0.52 251581 0.52
Insurance
FII's 1541764 31.80 1503356 31.01 1529703 31.55
Sub total 1677115 34.60 1636657 33.76 1671535 34.48
Other investors
Private Corporate
643239 1.33 1085938 2.24 1148134 2.37
Bodies
NRI's/OCB's/Foreign 218227 0.45 237007 0.49 202211 0.42

Page 63 of 119
 Serving to empower.

No. Of % No. Of % No. Of %

Shares Holding Shares Holding Shares Holding
Others 16971 0.04 34051 0.07 2148 -
Sub total 878437 1.81 1356996 2.80 1352493 2.79
General public 5052904 10.42 4978973 10.27 4634668 9.56
Grand total 4847782 100.00 4847782 100.00 4847782 100.00

SHAREHOLDING PATTERN
60.00%
53.17% 53.17% 53.17%
50.00%

40.00% 34.60% 34.48%

33.76% promoters
30.00% Non-Promoters
Other investors
20.00%
10.42% 10.27% 9.56% General public
10.00%

0.00%
30-06-2009 31-03-2009 31-12-2008

Page 64 of 119
 Serving to empower.

GROWTH SHOWN BY JK BANK IN THIS QUARTER

The Jammu and Kashmir Bank reported a good increase in standalone net profit for the
quarter ended June 2009. During the quarter, the profit of the bank rose 23.78% to Rs
1,170.50 million from Rs 945.60 million in the same quarter previous year.
Interest earned for the quarter rose 19.03% to Rs 7,753.70 million, while total income for the
quarter rose 24.40% to Rs 8,910.50 million, when compared with the prior year period.
It posted earnings of Rs 24.15 a share during the quarter, registering 23.85% growth over
prior year period.

Quarterly Results - Standalone (Rs in mn)

As at Jun – 09 Jun - 08 %Change
Interest Income 7,753.70 6,514.20 19.03
Net Profit 1,170.50 945.60 23.78
Basic EPS 24.15 19.50 23.85
Shares of the bank gained Rs 17.9, or 4.06%, to trade at Rs 458.50. The total
volume of shares traded was 390.00 at the BSE .

Page 65 of 119
 Serving to empower.

CHAPTER-IV

Page 66 of 119
 Serving to empower.

WORKING CAPITAL MANAGEMENT

Working capital, also known as net working capital or NWC, is a financial metric which
represents operating liquidity available to a business. Along with fixed assets such as plant
and equipment, working capital is considered a part of operating capital. It is calculated as
current assets minus current liabilities. If current assets are less than current liabilities, an
entity has a working capital deficiency, also called a working capital deficit.
WorkingCapital = CurrentAssets − CurrentLiabilities
Therefore, working capital refers to the excess of current assets over current liabilities.
Management of working capital is concerned with the problems that arise in attempting to
manage the current assets, the current liabilities and the interrelationship that exists between
them. In other words, it refers to all aspects of administration of both current assets and
current liabilities. The basic goal of working capital management is to manage the current
assets and current liabilities of a firm in such a way that a satisfactory level of working
capital is maintained, i.e. it is neither inadequate nor excessive. This is so because both
inadequate as well as excessive working capital implies idle funds which earns no profit for
the business and inadequacy of working capital may lead the firm to insolvency. Working
capital management policies of a firm have great effect on its profitability, liquidity and
structural health. A sound working capital management policy is one which ensures lowest
cost, adequate liquidity and sound structural health of the organization.

Page 67 of 119
 Serving to empower.

PRINCIPLES OF WORKING CAPITAL MANAGEMENT

The following are the main principles of a sound working capital management policy:
1. Principal of Risk Variation
Risk in this context, refers to inability of a firm to meet its obligations as and when they
become due for payment. Larger investment in current assets with less dependence on short-
term borrowing increases liquidity reduces risk and thereby decreases the opportunity for a
loss. To the contrary, less investment in current assets with greater dependence on short-term
borrowings increases risk, reduces liquidity as well as profitability. Thus there is a definite
and inverse relationship between the degree of risk and profitability. A conservative
management prefers to minimize the risk maintaining a higher level of current assets or
working capital while a liberal management assumes greater risk by reducing working
capital. However the goal of management should be to establish a suitable tradeoff between
profitability and risk.

2. Principle of Cost of Capital.

Cost of raising capital is different for different sources of raising working capital finance. It
is generally dependent on the degree of risk involved in raising capital from a particular
source. Higher the risk, higher is the cost and lower the risk, lower is the cost. A sound
working capital management should always try to achieve a proper balance between these
two.
3. Principle of Equity Position.
This states that the amount of working capital invested in each component should be
adequately justified by a firm’s equity position. Every rupee invested in the current asset
should contribute to the net worth of the firm. Thus this principle is concerned with planning
the total investment in current assets. The level of current assets may be measure with the
help of two ratios.
i. Current assets as a percentage of total assets.
ii. Current assets as a percentage of total sales.
While deciding about the composition of the current assets, the financial manager may

Page 68 of 119
 Serving to empower.

consider the relevant industrial average.

4. Principle of Maturity of Payment.
This principle states that a firm should make every effort to relate maturities of payment to
its flow of internally generated funds. It is concerned with planning the sources of finance for
working capital. Maturity pattern of various current obligations is an important factor in risk
assumptions and risk assessments. Generally, shorter the maturity schedule of current
liabilities in relation to expected cash inflows the greater is the inability to meet its
obligations in time.

NATURE OF WORKING CAPITAL REQUIREMENTS

The working capital requirements of a concern can be classified as:
1. Permanent or fixed or regular working capital requirements.
2. Temporary or variable working capital requirements.
Permanent working capital is that minimum amount which should always be deployed to
carry the business operations without interruption. This part of working capital should
generally be financed from the fixed capital sources. Temporary working capital is that
amount which is required for the seasonal demands and some special exigencies such as rise
in prices, strikes, extensive advertisement to capture more markets, etc. It should be financed
from short term sources of capital.
Both kinds of working capital - permanent and temporary are necessary to facilitate
production and sale through the operating cycle.
Working Capital Cycle
Cash flows in a cycle into, around and out of a business. It is the business's life blood and
every manager's primary task is to help keep it flowing and to use the cashflow to generate
profits. If a business is operating profitably, then it should, in theory, generate cash surpluses.
If it doesn't generate surpluses, the business will eventually run out of cash and expire..
The faster a business expands the more cash it will need for working capital and investment.
The cheapest and best sources of cash exist as working capital right within business. Good
management of working capital will generate cash will help improve profits and reduce risks.

Page 69 of 119
 Serving to empower.

Bear in mind that the cost of providing credit to customers and holding stocks can represent a
substantial proportion of a firm's total profits.
There are two elements in the business cycle that absorb cash - Inventory (stocks and work-
in-progress) and Receivables
les (debtors owing you money). The main sources of cash are
Payables (your creditors) and Equity and Loans.

Sources of Additional Working Capital

Sources of additional working capital include the following:
Existing cash reserves
Profits (when you secure it as cash!)
Payables (credit from suppliers)
New equity or loans from shareholders
Bank overdrafts or lines of credit
Long-term loans
To comment upon the working capital management and profitability of J&k bank, the
technique of ratio analysis is adopted.

The following two ratios have been calculated for the said purpose.
1. Current ratio.
2. Working capital turnover ratio.

Page 70 of 119
 Serving to empower.

Current Ratio:
The current ratio is an indicator of a firm’s short term solvency. A firm, to survive on a
continuing basis, should maintain sufficient liquidity. As a rule of thumb, 2:1 is considered
to be an ideal current ratio. The idea of having double the current assets as to current
liabilities is to provide a cushion against possible losses and to ensure a smooth day to day
functioning of the firm. There is, however, nothing very sacrosanct about the 2:1 ratio.
What is more important is the quality of current assets, how fast and to what extent can they
be converted into cash.
5 Yearly Trend of Current Ratio of J&k bank

Years Current Assets Current Current Ratio

Liabilities
2004 356.89 653.63 0.5:1times
2005 493.12 850.30 0.6:1times
2006 481.41 900.94 0.5:1times
2007 377.19 823.31 0.5:1times
2008 486.47 1102.02 0.4:1times

A relatively high current ratio is an indication that the firm is liquid and has the ability to
pay its current obligations in time and when they become due. On the other hand, a low
current ratio represents that the liquidity position of the firm is not good and the firm shall
not be able to pay its current liabilities in time. The above table indicates that the bank has
low ratio and will not be able to pay its increasing liabilities. In FY 2004 it was 0.5:1 and
then increases to 0.6:1 in FY 2005 and in FY 2008 it further decreases to0.4:1. The reason
of decrement in the current ratio is because current liabilities is highly exceeding over
current assets.

Page 71 of 119
 Serving to empower.

1200
1000
800
Current Assets
600
Current Liabilities
400
200
0
2004 2005 2006 2007 2008

Working Capital Turnover Analysis:

The amount of working capital is sometimes used as a measure of a firm’s liquidity. It is

considered that between the two firms, the one having the larger amount of working capital
has the greater ability to meet its current obligations. Working capital turnover analysis is,
therefore, used to measure the efficiency with which the firms are using their working
capital. For this purpose, working capital turnover ratio, which indicates the velocity of the
utilization of net working capital, is worked out. A higher ratio indicates efficient utilization
of working capital. In the following lines a comparative statement of working capital
turnover ratio of PTL is produced.
Net Working capital Of J&K Bank (in lacs)

Years Current Assets Current Net working

Liabilities capital
2004 356.89 653.63 -296.74
2005 493.12 850.30 -357.18
2006 481.41 900.94 -419.53
2007 377.19 823.31 -446.12
2008 486.47 1102.02 -615.55

The net working capital of J&K Bank is tremendously decreasing and has reached the
negative values because of the increasing current liabilities and is unable to meet its short
term liabilities. Therefore the bank has negative net working capital. This indicates that the
bank is not utilizing its fixed assets efficiently. This may adversely affect its profitability
.

Page 72 of 119
 Serving to empower.

position.

0
-100 2004 2005 2006 2007 2008
-200
-300
Net Working Capital
-400
-500
-600
-700

Working Capital Turnover Ratio of J&K Bank

Years sales Net Working Working capital

capital ratio
2006 2064.16 -419.53 -6.9times
2007 2434.23 -446.12 -5.5times
2008 2988.12ss -615.55 -3.4times

It is very strange to analyze such the working capital turnover ratio of J&K Bank as its net
working capital is negative. The sales of the firm are also decreasing. So the firm will not
be able to meet its short term liabilities. This consistent negative ratio will shrink the
current assets of the bank relative to its total assets.

Page 73 of 119
 Serving to empower.

0
-1 2006 2007 2008
-2
-3
-4 W.C. Turnover Ratio
-5
-6
-7
-8

Profitability Ratios of J&K Bank

The primary objective of the business is to earn profit. Profit earning is considered for the
survival of the business. So to see the profitability position of the business, profitability
ratios are used to interpret the profitability of the concern. So profitability ratios are the
financial metrics that are used to assess a business's ability to generate earnings as
compared to its expenses and other relevant costs incurred during a specific period of time.
For most of these ratios, having a higher value relative to a competitor's ratio or the same
ratio from a previous period is indicative that the company is doing well. The following
profitability ratios have been used to interpret the profitability of J&K Bank;
Operating Profit ratio:
This ratio tells us about the earning capacity of the firm on the basis of its business
operations and from earnings from the other sources. It shows whether the business is able
to stand in the market or not. It is calculated as;
Operating profit ratio=Operating profit/Sales*100
Operating Profit Ratio of J&K Bank
Year Operating Profit Sales Operating Profit ratio
2006 306.86 2064.16 15%
2007 460.44 2434.23 18%
2008 578.25 2988.12 19%

Page 74 of 119
 Serving to empower.

The operating Profit of J&K Bank is not high but is showing an increase from the FY06 to
FY08.This shows that the efficiency of the business is not high and the bank is generating
revenue from the comprehensive sources other than its business operations.
Operating profit ratio

20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
2006 2007 2008

Net Profit ratio

This ratio indicates the relationship between net profit and sales and is calculated as;
Net Profit ratio=Net profit after tax/Net sales*100
This ratio is the percentage of sales dollars left after subtracting the Cost of Goods sold and
all expenses, except income taxes.
N.P Ratio (in lacs) of J&K Bank
Year Profit after tax Net Sales Net Profit ratio
2006 178 2064.16 12%
2007 274 2434.23 11%
2008 360 2988.12 9%

Page 75 of 119
 Serving to empower.

Net operating ratio

14%
12%
10%
8%
6%
4%
2%
0%
2006 2007 2008

If we look at the trend of ratio, it is decreasing from 12% to 9% hence the profitability.
Thus the bank is not able to achieve a satisfactory return on its investments as the profit is
not sufficient. The bank does not have the high capacity to face the adverse economic
conditions.
WORKING CAPITAL FINANCING BY J&K BANK

FINANCIAL VIABILITY
No financial institution would sanction the financing of working capital unless it is satisfied
about the financial viability of the company. As far as J& K Bank is considered here
evaluation of Borrower Company is done on the basis of following ways:
1. Industry analysis
2. Company analysis
The evaluation relates not only to profitability but also to cash flows to determine the
capacity of the firm to pay interest charges and repayment of debt installments. If borrower
had already taken the debt from the company in past years then its past performance is
checked whether the borrower had repayed the debt amount or not.
INDUSTRY ANALYSIS
Projections are made that after IT industry, the herbal industry will be India’s second

Page 76 of 119
 Serving to empower.

biggest revenue earner. For globalization the ist phase is to focus on medical plants and
formulation, which can stand the scrutiny by any system of assessment and standardization
process. The global market for herbal products is exploding. It is estimated to touch US $5
trillion by 2020.Sales of herbal products was in the vicinity of 21 billion US dollars The
market is huge and is growing. As far the demand of the herbal products in Kashmir is
concerned, currently four out of ten people are using it.
COMPANY ANALYSIS
In company analysis whole information about company is analyzed like what is the demand
of its products in the market by doing market analysis of the company, what is its
profitability by analyzing its financial statements, its effect on environment whether it is
pollution free or causing any kind of pollution to the environment by doing its ecological
analysis,determing its effect on economy whether it helps in decreasing employment or it is
actually increasing it .Its effect on whole economy.

Page 77 of 119
 Serving to empower.

LIVE CASE STUDY ON

To study the way of financing of working capital by JK Bank,I came across a live project that
needed to be financed.The purpose of the project is to manufacture the herbal products from
locally (Kashmir)available herbs in industrial estate,Anchidora Anantnag ,Kashmir under the
name M/S “XYZ”.The firm is a Proprietary concern of Dr Rahul Sharma. The global market
for the aurvedic products is immensely expanding and is about to touch $35 trillion by the
year 2020.The major players in this line are M/S Dabur India Ltd.,M/s.Zandu
Pharmaceuticals Works Ltd., M/S Vaidyanath Ayurveda Ltd.Maharishi Ayurveda corpn. Etc.
There is no such unit in the Kashmir valley so the unit is to be established for manufacturing
ayurvedic products for the treatment of a no. of ailments like cataract, headache, myopia, pus
in ear etc.
For this purpose, the party requested for the working capital of Rs 6o Lacs and the term loan
facility of Rs 67.79 Lacs. But my analyzing the various parameters of the project like
requirements of the raw material, capacity utilisation, projected sales, projected profitability
statements, the unit will be provided with the working capital of Rs 20.00 Lacs and the term
loan of Rs 12.00 Lacs.

ABOUT PROMOTER
M/S Shapoo Herbal Products is a proprietary concern of Dr. Gh. Mohd Shapoo, resident of
Anantnag,Kashmir is a retired B.A.M.S doctor.To manage the affairs of the unit,he is being
selected by Enterpreneurship Developed Institute Of India for one year diploma in business
enterprenuership under their,OLPE Scheme in collaboration with friedrich-Naumann-shifting
Germany sponsored by national Science And Technology Of India.With his educational
background he is expected to do well to emplement and manage the affairs of the business
successfully.
RAW MATERIAL:-
The main raw materials needed for the preparation of ayurvedic drugs are:-
Tulsi,Asparagus,Satavar,Indiangooseberry,licorice,guduchi,haldi,ajwain,kokum,ashok,winter
cherry,heeng,chandan,soya,saffron,senna,vaidang,ajwain,kuth safad masali etc.which are

Page 78 of 119
 Serving to empower.

readily available in the valley.The Govt. has also taken some initials to cultivate some of the
herbs which the concern can easily purchase from the market from the J&K state and outside
the state as well.These herbs will be curing many chronic diseases which include burns
boils,baldness,bloodpressure,dermatis,jaundice,leprosy,kidney infections,nausea of all kinds
and many such diseases. Process of manufacture:-
The process of manufacturing can be classified into the sections like:
I. Tablets making:-
a. Formulation
b. Mixing
c. Granulation
d. Drying
e. Lubrication
f. Compression
g. Coating
II. Syrup making:-consists of mixing of various ingredients together.
III. Capsules and their filling:-The materials are powdered and filled into the capsules.this
is done under pressure and sealing of the capsule wall occurs as dual and coincident
operation.

PLANT AND MACHINERY:

The plant and machinery needed by the unit can be categorized into sections as:
I. Tablet making section:This particular section will be includinhig a no. of small and
large machines like powder and mass mixer,multi fill mill for granulation,horizontal
granulator, oscillating granulator,drying oven electrical cum steam operated mode trays,fluid
bed dryer,fully automatic blister packing machine etc. Capsule making section: This very
section includes machines used for making capsules which include double cone blender, Rota
cuve blender, stainless steel drum, Capsule filling machine, capsules counters. Ointment
section: This section includes a no. of machines like Planetry mixer, wax melting kettle, fully
automated tube. Syrup section:This section also works with a no.of machines which include
stainless steel cylindrical tank,filter presses,industrial stirrer,emulsifier,bottle washing and

Page 79 of 119
 Serving to empower.

bushing machine,batch printing machine,label gumming machine,volumetric liquid filling

machine,semi automatic sealing machine etc. All the items of machinery are available to the
firm indigenously and can be procured from the reputed suppliers from inside and outside the
state.
MANPOWER REQUIREMENT;-
The manpower required for the unit can be categorized into administrative/sales staff and
plant and machine/maintenance staff.The details are provided as;
Administrative/sales manpower
Reqd. Salary per month Total Amt.
1. Manager/promoter 1 10000.00 10000
2. Computer operator 1 4000.00 40000.00
3. Peon 1 2000.00 2000.00
4. Sales & marketing staff 2 4000.00 8000.00
5. Storekeeper 1 4000.00 4000.00
Total 28000.00
Plant and Machine/Maintainance staff
1. Supervisor 2 8000.00 16000.00
2. Operators 2 4000.00 8000.00
3. Un-skilled staff 5 3000.00 15000.00
4. Semiskilled 5 3500.00 17500.00
5. Lab incharge 2 4000.00 8000.00
Total 64500.00
To sum up the manpower costs about Rs 106375.00 lacs including perks @ 15%.
LAND & BUILDING:-
The promoter is planning to establish his unit at Anchidora, Anantnag Kashmir for which the
requirement of the land will be i.00 Kanal and 5400 sq.ft.The land cost/total premium is Rs
45000.00.Apart from land the unit is planning for building of A class construction.The
building will be having different working centres like production shop area,testing lab,raw
material storage area,product storage area,repair centres,DG set room etc. Apart from the
construction of the building the promoter is looking for parking space, inside roads, garden,

Page 80 of 119
 Serving to empower.

septic tanks, and soakage pits etc.

The land to building ratio will be 1:1.70.
Highlights of Project:
Basis:
Capacity: 90,000 Kgs. of raw materials processed per year comprising of
three types of raw materials required for the manufacturing of three different types of
medicines
a. 12,000 kgs of Ointment.
b. 60,000 kgs of Syrup.
c. 18,000 kgs of Tablets / Capsules of other medicines.
300 Kg of Raw material per day for 300 days per year are to be purchased with following
Break Up
1. 40 Kg of Ointment per Day.
2. 200 Kgs of Syrup per Day.
3. 60 Kgs Tablets/Capsules of other medicines.
Details of Raw Materials used in the production of three types of Drugs:
A. Ointment Section
Recovery percentage 80%
Quantity used 40 kg per day
Recovered quantity 32 kgs per day
Rate per kg Rs.200
Cost of Raw materials 8000
Cost of raw material in finished basis = Rs.250/=
B. Syrup Section

Recovery percentage 75 %
Quantity used 200 Kgs per day.
Recovered Quantity 150 kgs per day.
Rate per Kg Rs.250
Cost of Raw materials 50,000
Cost of raw material in finished basis = Rs.333/=

C.Tablets/ Capsules Section

Recovery percentage 75%

Quantity Used 60 kg per day.
.

Page 81 of 119
 Serving to empower.

Recovered quantity 45 kg per day.

Rate per Kg Rs.450
Cost of Raw materials 27,000
Cost of raw materials in finished basis = Rs.600/=

S.no Name of raw Per day Rate No. of days Total

materials Consumption ( Rs.in lacs)
1. Ointment 40 kgs 200 /kg 300 24.00
2. Syrup 200 kgs 250/kg 300 150.00
3. Tablets/Capsules 60 kgs 450/kg 300 81.00
Total 300 900 300 255.00

Cost of raw materials after recovery for product:

A. Ointment Rs.250/kg.
B.Syrups Rs.333.33/kg.
C.Tablets /Capsules Rs.600/kg.

Items manufactured: Raw Material.Kgs Products Kg.

A.Ointments 12,000 9,600

B.Syrups 60,000 45,000
C.Tablets Capsules 18,000 13,500

Total 90,000 68,100

Proposed Selling Price: (for 90,000 kgs of raw materials)

S.no Item produced Quantity Rate Amount (in lacs)

1. Ointments 12,000 250 30.00
2. Syrups 60,000 333.33 200.00
3. Tablets/ Capsules 18,000 600 108.00
Total 90,000 338.00

Packing Costs:
S.No Item Rs./Day Rs.per year (in lacs)
1. Ointments 640 1.92
2. Syrups 2250 6.75
3. Tablets/ Capsules 1800 5.40
Total 14.07

Page 82 of 119
 Serving to empower.

Total costs of raw materials with packaging materials come to: Rs.352.07 lacs (Rs.338.00
lacs plus Rs.14.07 lacs.
However the raw materials required as per the capacity utilization for first five years will be
as:

Years
50% 1st year 60% 2nd 70% 3rd 80% 4th year 90% 5th
year year year
Raw materials 176.00 211.00 246.40 281.00 316.86
required.

Working Capital Requirement for the First Year

Working Expenses:

S.no Particulars Amount Per year Amount per Month

1. Salary Rs. 12.76 1.06
2 Electricity and D.G Set operation Rs. 0.84 0.07
3. Overheads per Year Rs. 3.63 0.30
4. Raw materials Rs. 176.00 14.66
5. Debtors Rs.36.00 3.0
Total Rs 260.98 Rs 19.90

Out of the working capital of Rs.19.90 lacs per month the break up of the amount will
be:
Total Working Capital required for one month: Rs.19.90 lacs.
i) Promoters Contribution 40%: Rs.7.90 lacs
ii) Bank Finance 60%: Rs.12.00 lacs
Total Rs.19.90 lacs.

Interest and Repayment Schedule on Working Capital loan:

Rate of interest: 12.00%

Amount in lacs
Year Opening Balance Repayment Closing Balance Interest/year
1. 12.00 1.44 10.56 1.44
2. 10.56 1.26 9.30 1.26
3. 9.30 1.11 8.19 1.11
4. 8.19 0.98 7.21 0.98
5. 7.21 0.86 6.35 0.68

Page 83 of 119
 Serving to empower.

Details of the project report for term loan

Details of the fixed costs required for the establishment of Building and purchase of
machinery and furniture and fixture are as

S.No Particulars Amount (in lacs)

1. Land & Building 25.59
2. Plant & Machinery 38.39
3. Furniture and Fixtures 1.95
4. Pre- operative & Preliminary Expenses 1.85
Total 67.78

Land and building:-The cost of acquiring the land and constructing the building will be Rs
25.59 Lacs.
Preliminary and pre-operative expenses: include establishment expenses, expenses on
travelling, postage, printing, rent, rates, legal and taxes, insurance report fee and security
deposits. This will be costing Rs 67.78 Lacs

Details of Running and Maintenance Costs of the Fixed Assets:

1. Land & Building 25.14

2. Plant & Machinery 38.39
3. Furniture and Fixtures 1.95
Total 65.93

Year Cost % Total (in

Lacs)
1. 0.50% 0.32
2. 0.75% 0.49
3. 1.00% 0.65
4. 1.22% 0.80
5. 1.50% 0.98
6. 1.75% 1.15
7. 2.00% 1.31.
8. 2.50% 1.64
9. 3.00% 1.97
.

Page 84 of 119
 Serving to empower.

10. 4.00% 2.63

Financial requirements as requested by the party:

Out of the total project cost of Rs 67.78 Lacs,the promoters will raise the capital of Rs
26.63 Lacs ammounting to 30% contribution of the total project cost.The promoters will
arrange equity from the ancestral resources; from established business or buy way of secured
loans and advances from the friends and relatives.
Financing pattern of fixed assets

Total Fixed Capital (Term Loan) required: Rs.67.78 lacs

i) Equity (Promoters contribution) 30%: Rs. 20.33 lacs
ii) SFAC (Small Farmer’s Agribusiness Consortium): Rs.16.94 lacs
iii) NMPBC Subsidy 15%: Rs.10.15 lacs
iv) Bank Finance 30%: Rs.20.30 lacs
Total Rs.67.78 lacs
Income generation through Sales for first year:
(Taken on 90,000 kgs of raw materials)
S.no Item produced Quantity Rate/kg Amount (in lacs)
1. Ointments 12,000 425 51.00
2. Syrups 60,000 450 270.00
3. Tablets/ Capsules 18,000 525 94.50
Total 90,000 415.50
The sales of Rs.415.50 lacs will be achieved if there is 100 % capacity utilization .However
the concern is able to operate to the 50% of its capacity utilization in the first year of
operation with an increase 10% yearly on wards.
Further it is assumed that there will be price rise of 10% from first year.
The corresponding rates will be as

1 Afterwards
Ointment 425 467
Syrup 450 495
Tablets/Capsules 525 577

Sales realization for the second year

S.no Item produced Quantity Rate/kg Amount (in
lacs)
1. Ointments 12,000 467 56.04
2. Syrups 60,000 495 297.00
3. Tablets/ Capsules 18,000 577 103.86
Total 90,000 456.90
Taking all these into consideration the sales of the concern for first five years will be as.
Year
Sales 50% 1st year 60% 2nd year 70% 3rd year 80% 4th year 90% 5th year

Page 85 of 119
 Serving to empower.

207.75 274.14 319.83 365.52 411.21

SALES TURNOVER(in Lacs)

year 5

year 4

year 3

year 2

year 1

0 50 100 150 200 250 300 350 400 450

Thus the establishing firm will be able to increase the sales year after year at 10% increase in
utilization capacity and 10% increase in price rise.

Expenses incurred during the year:

Operating expenses
1. The firm is able to generate employment for about 16 persons for which the annual salary
for the ist year will be Rs 12.76 Lacs.
2. The overheads and electricity and D.G set operation will amount to Rs 3.63 Lacs and 0.84
lacs respectively for the ist year.

Particulars Rs.Per Month Per Year (in lacs)

1. Overheads 30,314 3.63
2. Electricity and D.G set operation 7,000 0.84
3. Salary for employees 1,06,375 12.76
Total 1,43,689 17.24

Cost escalation is 10% from first year onwards. Thus the expenses for first five years will
come to
Years
1 2 3 4 5
Expenses 17.24 18.96 20.85 22.93 25.22

Financial expenses
Deprecation has been calculated on the straight line method at 5% for building, 10% for
.

Page 86 of 119
 Serving to empower.

equipments and 155 for furniture and fixtures.

Depreciation per year

S.no Depreciation of Total Cost Rate of Dep. Amount in lacs

1. Building 25.14 5% 1.25
2. Equipment 38.39 10% 3.83
3. Furniture and Fixtures 1.95 15% 0.29
Total 65.93 5.37

Calculation of interest

Interest and Repayment Schedule on term loan:

Rate of interest: 12.00%
Amount in lacs
Year Opening Balance Repayment Closing Balance Interest/year
1. 20.30 0.00 20.30 2.43
2. 20.30 5.07 15.23 2.43
3. 15.23 5.07 10.16 1.82
4. 10.16 5.07 5.09 1.21
5. 5.09 5.09 0.00 0.61
Total 20.00 8.50

Cost of operation /Financial Expenses of the five projected years

Year
Capacity 50% 60% 70% 80% 90%
WC with escalation 190.00 209.00 230.00 253.00 278.00
@ 10% Year
Depreciation 5.37 5.37 5.37 5.37 5.37
Interest on term loan 2.43 2.43 1.82 1.21 0.61
Interest on WC 1.44 1.26 1.11 0.98 0.68
Commission on sales 6.23 8.22 9.59 10.96 13.46
@ 3%
R & M Costs 0.32 0.49 0.65 0.79 0.98
Total Costs 205.79 226.77 248.54 272.31 298.42

Page 87 of 119
 Serving to empower.

Profitability position statement

Or
Cash Flow of five years

1 2 3 4 5
Sales 50% 1st year 60% 2 nd
70% 3 rd
80% 4 year 90% 5th year
th

year year
207.75 274.14 319.83 365.52 411.21
Expenses 205.79 226.77 248.54 272.31 298.42
O.Profit 1.96 47.37 71.29 93.21 112.79
Tax 0.00 0.00 0.00 0.00 0.00
Net Profit 1.96 47.37 71.29 93.21 112.79
Add.Dep 5.37 5.37 5.37 5.37 5.37
Cash 7.33 52.74 76.66 98.58 118.16
Accrued
Repayment 3.87 8.76 8.00 7.26 6.38
Net Cash 3.46 43.98 68.66 91.32 111.78

Details of Debit Service Coverage Ratio:

S.No Sources of Funds 1 2 3 4

1. Profit after tax 1.96 47.37 71.29 93.21
2. Depreciation 5.37 5.37 5.37 5.37
3. Interest on term loan 2.43 2.43 1.82 1.21
Total 9.76 55.17 78.48 99.79
Deposition of funds
1. Repayment of loan 3.87 8.76 8.00 7.26
(term loan + WC)
DSCR 2.52 6.29 9.81 13.74

Page 88 of 119
 Serving to empower.

average DSCR
16
14
12
10
8
average DSCR
6
4
2
0
1 2 3 4

Recommendations: Sanctioned for the CTL Facility of Rs.32.30 lacs (Thirty two lacs and
Thirty Thousand Only) with the following Break up.
1. Term Loan of Rs.20.30 lacs (Twenty lacs and thirty thousand)
2. Working Capital of Rs.12.00 lacs ( Twelve Lacs Only )
In favour of party against the Security of
a) Primary: Hypothecation of Stocks of Raw materials. Semi -Finished Goods .Finished
Goods and Machinery & tools.
b) Collateral: Third Party Guarantee of Two Persons. &
c) Additional: Mortgage of Lease Hold rights of Land & She
TERM LOAN ANALYSIS OF XYZ MEMORIAL EDUCATIONAL TRUST
This is the loan proposal of a fresh concern XYZ Memorial Trust,Mattan ,Anantnag, which
came to the JK Bank for finance for the establishment of the educational trust .The trust
comprising of six trustees also referred to as Executive body members with specific
portfolios who will manage the trust.The trust will have the organisation office at Mattan
Anantnag in the ist instance.The main cause of organizing the trust has to provide sustainable
development,general awareness and genuine concern towards the environment,ecosystem
and general education of the people.The trust has well written constitution/bye laws which
provide the preamble aims,objectives and constitution to the trust.One of the aims and
objectives of the trust is the establishment of the Educational institute for providing general
education needs to the children for which the trust has been granted sanction for
establishing/running a private school in Mattan upto the 3rd primary by the Chief Education
Officer.
The trust has earlier requested for the following term loan facilities
a. Term loan facility of Rs 35.00
lacs for the construction of the school buildings
b. Term loan facility of Rs 25.00
Lacs for the purchase of two school buses
It is pertinent to mention here that the trust had earlier forwarded the project report with total
cost of Rs 174.15 Lacs, persual of which revealed that the Fee structure, expenses incurred
.

Page 89 of 119
 Serving to empower.

etc included in the computation of the profitability statement was on the much higher side.
But when I analyzed the project; I observed that the project will not be able to generate ample
profit during its two years of operation. The same was confirmed while taking the visit of
four like institutes namely, Al’Sarwat Convent, Lyseum School, St.Peters International
Academy and St.Lukes Convent in the vicinity of the proposed institute from which the
proposed institute will face direct competition. So I prepared a fresh report wherein the fee
structure has been taking in accordance with the prevailing institutions in the area. While
serving I found that the maximum monthly fee charged by the institutions of the area is Rs
600.00 per month. Besides, the maximum admission fee charged is Rs 12000.00.The project
report now submitted has incorporated the fee as Rs 600 per month and the admission fee of
Rs 10000.00.Besides proposing the admission of 240 students on the ist year, the party has
now requested for the term loan facility of Rs 35 Lacs only for the construction of the school
building

Details of the Trustee:-

Mohammad Yousuf Bala Chairman
Shubnam Aftab Vice-chair person
Aftab Ahmad Ganie Gen. secretary
Mrs.Hoora Banoo Member
Mukhtar Ahmad Bala Treasurer
Mrs.Maryem Store –cum record
Keeper
The trust shall be managed by the management comprising of following persons:
Purpose of Advance: For the establishment of an educational Institute.
Facility requested by the party: Term loan of Rs.60.00 lacs with the following Break up
A. Primary: Hypothecation of
Term Loan Rs. 35.00 lacs for the construction of Educational unit.
B. Term loan of Rs. 25.00 lacs
for the purchase of two school buses.
Facility recommended by the branch: Same as above.
Security offered:
A. Primary: Hypothecation of
plant & Machinery & Equipments
B. Collateral: Personal
Guarantee of Two Persons. And Personal Guarantee of
Mortgagers.
Additional: Mortgage of land measuring 07 kanals 08 Marlas in total valued at Rs. 74.00
lacs as per valuation report & an office building constructed there on valued at Rs. 5.40 lacs
as per valuation report dated 28-05-09. Total cost of mortgaged property Rs.79.40 lacs

DETAILS OF THE PROJECT REPORT

The total proposed project report cost to be incurred for undertaking the activity is estimated
at Rs 61.64 Lacs with the following break-up;
.

Page 90 of 119
 Serving to empower.

S. NO PARTICULARS AMOUNT IN LACS

1. Land Already incurred
2. Site development
3. Building 51.32 (includes work of
Rs.7.00 already completed)
4. Misc. Fixed Assets 14.45
5. Preliminary &preoperative expenses 1.69
Provision for contingencies 1.18
Total 61.64

Land & Site Dev.: The cost of acquiring the land at Rs. 74.00 lacs & costs for site dev. Of
Rs.15.58 lacs have already been incurred by the trust.
Building: The proposed school is to be established at Mattan Ang. The estimated cost to be
incurred on the construction of building as estimated by the Amar Architects, Civil
Engineering Consultant, New Qazi Bagh Anantnag. are Rs.52.00 lacs.The promoters having
already completed works of Rs. 7.00 Lacs.
Misc. fixed assets: comprising mainly of Office furniture/fixtures, computers along with
peripherals, fire fighting equipments Benchs, tables, chairs etc estimated to be purchased at
the cost of Rs 14.45 Lacs.
Preliminary and pre-operative expenses:include establishment expenses,expenses on
travelling,postage,printing,rentetc.Insurance reports preparation fee and security deposits.the
expenses has been worked out at Rs 1.69 Lacs.
Financial requirements as requested by party:out of the total project cost of Rs 61.63
Lacs.The promoters or trust will raise capital of Rs 26.63 Lacs ammountingb to about 43% of
the total project cost.The promoters shall arrange equity from the ancestral
resources/contributions and from the established business or buy way of secured loans and
advances from the friends and relatives of the premotors/management. The promoters
contribution shall include the cost of the land as valued at Rs 50.00 Lacs.

FINANCE PATTERN

S.no. Particulars Amount(Lacs) Percentage break-up

1 Total expenditure on fixed outlay 61.63
2 Promoters contribution 26.63 43%
3 Long term financing 35.00 57%
Total 61.63 100%

Page 91 of 119
 Serving to empower.

60% 57%

50%
43%
40%

30% Promoters contribution

Bank financing
20%

10%

0%
Financing Pattern

Income realization per annum

The trust has projected the income statement on the assumptions that
1) There will be fresh admissions
of 240 students in the ist year with the addition of 90 more students from the second year
onwards.
2) The admission fee of Rs
10000.00 will be charged which will be increased to Rs 12,000.00 on the third year of
operation and later onto Rs 15,000.00 from fifth year.
3) The students will have to pay
Rs 600 as tution fee monthly which will be increased gradually to Rs 800 in the seventh year
of operation.
Accepting the no. of students as 200 for the IST year, the income can be assessed as follows;
Years 1 2 3 4 5 6 7

Fresh admissions 200 60 60 60 60 60 60

Average ad. Fee 10000 10000 12000 12000 15000 15000 16000
per student
Total ad. Fee (in 20.00 6.00 7.20 7.20 9.00 9.00 9.60
Lacs)
Av. Tution 600 650 650 650 700 750 800
fee/month/student
Total fee received 14.40 20.28 24.96 29.64 36.96 45.00 53.76
Total receipts 34.40 26.28 32.16 36.84 45.96 54.00 63.36

Expenses accrued per annum

1. Operating expenses

Page 92 of 119
 Serving to empower.

The school is projected to generate employment for 23 persons for which the annual salary
for the IST year works out to be Rs 8.32 Lacs and an increase of 20% is shown for the ist
year onwards
2. Administrative expenses are taken as 5% of net income of every year.
3. Selling expenses are taken at 2 % of net income of every year.
Years

Particulars 1 2 3 4 5 6 7
Salary & wages 8.32 9.98 11.97 14.36 17.23 20.69 24.82
Repairs and 1.20 1.80 2.40 3.00 3.00 3.60 3.60
Maintainance
Administrative 1.72 1.31 1.60 1.84 2.29 2.70 3.16
expenses
Selling 0.68 0.52 0.64 0.73 0.91 1.08 1.26
expenses
Total 11.92 13.61 16.61 19.93 23.43 28.07 32.84

Financial expenses
Depreciation has been calculated on straight line method @ 5% for building and furniture and
fixtures.
Years
Particulars 1 2 3 4 5 6 7
Dep.on building@ 2.50 2.50 2.50 2.50 2.50 2.50 2.50
5%
Dep.on 0.72 0.72 0.72 0.72 0.72 0.72 0.72
furniture/fixture@5%
Interest on term loan 4.90 4.07 3.26 2.45 1.63 0.81 0.00
Total 8.12 7.29 6.84 5.67 4.85 4.03 3.22

Calculation of interest
Proposed bank borrowings=Rs 35.00 Lacs
Rate of interest=14%
Repayment =6years
Repayment installment=5.83 Lacs

Year Opening Balance Repayment Closing balance Interest

1 35.00 5.83 29.17 4.90
2 29.17 5.83 23.34 4.07
3 23.34 5.83 17.51 3.26
4 17.51 5.83 11.68 2.45
5 11.68 5.83 5.85 1.63
6 5.85 5.83 0.02 0.81
7 0.00 0.00 0.00 0.00

Page 93 of 119
 Serving to empower.

Projected profitability statement

Particulars 1 2 3 4 5 6 7

Income 34.40 26.28 32.16 36.84 45.96 54.00 63.36

Operating 11.92 13.61 16.61 19.93 23.43 28.07 32.84

expenses
Gross Profit 22.48 12.67 15.55 16.91 22.53 25.93 30.52

Financial 8.12 7.29 6.48 5.67 4.85 4.03 3.22

Expenses
Profit Before 14.36 5.38 9.07 11.24 17.68 20.90 27.30
Tax
Tax 5.02 1.88 3.17 3.93 6.18 7.31 9.55

Profit after 9.34 3.50 5.90 7.31 11.50 13.59 17.75

Tax
Add back Dep 3.22 3.22 3.22 3.22 3.22 3.22 3.22

Total cash 12.56 6.72 9.12 10.53 14.72 16.81 20.97

sulplus
Less:Term 5.83 5.83 5.83 5.83 5.83 5.83 5.83
Loan Payment
Net cash 6.73 0.89 3.29 4.70 8.89 10.98 15.14
accruals

7th year
6th year
5th year
Projected Profitability(Gross profit in lacs)
4th year
3rd year
2nd year
Ist year

0 5 10 15 20 25 30 35

Page 94 of 119
 Serving to empower.

Repayment: The term loan of Rs 35.00 Lacs shall be repayed in 72 monthly installments
with EMI of Rs o.74 lacs with a moratorium period of 6 months during which only interest
will be served by the concern to keep the account srandard.
Recommendations:
In view of the above discussed pars and branch recommendations it is proposed if
approved, the branch may accord sanction for the term loan of Rs 35.00 Lacs in favour of the
trust against the security mentioned. On the terms and conditions applicable to such a types of
advances besides,
1. Trust to raise equity to the tune of Rs 26.63 Lacs from their own resources and not from
friends, relatives or other sources detrimental to the bank
2. The term loan be released in a phased manner and as per the progress of the construction
3. Trust to furnish the NOC for the construction of school buildings from municipal
community Mattan before the release of the facility.

Page 95 of 119
 Serving to empower.

EMPLOYEE SATISFACTION

Employee satisfaction is a measure of how happy workers are with their job and working
environment. Keeping morale high among workers can be of tremendous benefit to any
company, as happy workers will be more likely to produce more, take fewer days off, and
stay loyal to the company. There are many factors in improving or maintaining high
employee satisfaction, which wise employers would do well to implement.

To measure employee satisfaction, many companies will have mandatory surveys or face-to-
face meetings with employees to gain information. Both of these tactics have pros and cons,
and should be chosen carefully. Surveys are often anonymous, allowing workers more
freedom to be honest without fear of repercussion. Interviews with company management can
feel intimidating, but if done correctly can let the worker know that their voice has been
heard and their concerns addressed by those in charge. Surveys and meetings can truly get to
the center of the data surrounding employee satisfaction, and can be great tools to identify
specific problems leading to lowered morale.

Many experts believe that one of the best ways to maintain employee satisfaction is to make
workers feel like part of a family or team. Holding office events, such as parties or group
outings, can help build close bonds among workers. Many companies also participate in
team-building retreats that are designed to strengthen the working relationship of the
employees in a non-work related setting. Camping trips, paintball wars and guided
backpacking trips are versions of this type of team-building strategy, with which many
employers have found success.

Raises and bonuses can seriously affect employee satisfaction, and should be given when
possible. Yet money cannot solve all morale issues, and if a company with widespread
problems for workers cannot improve their overall environment, a bonus may be quickly
forgotten as the daily stress of an unpleasant job continues to mount.

If possible, provide amenities to your workers to improve morale. Make certain they have a
comfortable, clean break room with basic necessities such as running water. Keep facilities

Page 96 of 119
 Serving to empower.

such as bathrooms clean and stocked with supplies. While an air of professionalism is
necessary for most businesses, allowing workers to keep family photos or small trinkets on
their desk can make them feel more comfortable and nested at their workstation. Basic
considerations like these can improve employee satisfaction, as workers will feel well cared
for by their employers.

The backbone of employee satisfaction is respect for workers and the job they perform. In
every interaction with management, employees should be treated with courtesy and interest.
An easy avenue for employees to discuss problems with upper management should be
maintained and carefully monitored. Even if management cannot meet all the demands of
employees, showing workers that they are being heard and putting honest dedication into
compromising will often help to improve morale.

Page 97 of 119
 Serving to empower.

QUESTIONNAIRE

EMPLOYEE SATISFACTION
1. Where do you rank the qualification possessed by you for the
position you are at present?
present
a) Over qualified
b) Highly qualified
c) Rightly Qualified
d) Under qualified

0%

29%
Highly qualified
rightly qualified
57%
14% over qualified
Under qualified

INTERPRETATION
After the response from employees were analysed, it is observed that most of the
employees are highly qualified for the position they hold.

Page 98 of 119
 Serving to empower.

2. How much acquainted are you with your job specifications?

specifications
a) Highly knowledgeable
b) Moderately knowledgeable
c) Less knowledgeable
dgeable

15%
Highly knowledgeable

28% 57% Moderately

knowledgeable
Less knowledgeable

INTERPRETATION
Most of the employees feel that they are highly acquainted with their job
specifications, clearly showing that most of the employees know that what they
have to do.

Page 99 of 119
 Serving to empower.

3. How do you rank the work culture of your branch?

a) Excellent
b) Good
c) Average

14%

15%
Excellent
good
71%
Average

INTERPRETATION
Most of the employees have ranked the work culture of the bank as good
showing that maximum employees are somewhat satisfied with the work culture
prevalent in their organisation.

Page 100 of 119

 Serving to empower.

4. How do you rank your boss on possession of the following characters

in him/her?
I. Efficiency
a) Highly efficient
b) Moderately efficient
c) Least efficient

60% 57%

50%

40%
29% Highly efficient
30%
Moderately efficient
20% 14% Least efficient

10%

0%
Efficiency

Page 101 of 119

 Serving to empower.

II. Effectiveness
a) Highly effective
b) Moderately effective
c) Least effective

250%

200%

150%
Highly effective

100% Moderately effective

Least effective
50%

0%
Effectiveness

Page 102 of 119

 Serving to empower.

III. Employee subordinate relationship

a) Excellent
b) Good
c) Average
d) Bad

50%
45%
40%
35%
30% Excellent
25% Good
20% Average
15% Bad
10%
5%
0%
Employee-subordinate relation

IV. Attitude
a) Good
b) Egoistic
c) Strict
d) Friendly

Page 103 of 119

 Serving to empower.

45%

40%

35%

30%

25% Good
Egoistic
20%
Strict
15% Friendly

10%

5%

0%
Attitude

INTERPRETATION
Most of the employees feel that they are moderately efficient, highly effective,
good in terms of building relations and has good attitude style.

Page 104 of 119

 Serving to empower.

5. DO you get any sort of training

a) Never
b) Often
c) Less often
d) Regular

14% 14%

Never
Often
Regular

72%

INTERPRETATION
Most of the employees say that training is often provided to them showing that
the Bank’s Management is concerned towards upgrading the skills of the
employees.

Page 105 of 119

 Serving to empower.

6. What is the amount of work load on you?

a) Highly work loaded
b) Moderately work loaded
c) Least work loaded

0%

31%
Highly work loaded
Moderately work loaded
69% least work loaded

INTERPRETATION
The response from the employees of the bank reveal that most of the
employees feel that they are being overloaded with the work, which can prop
out as a cause of concern for the bank in future.

Page 106 of 119

 Serving to empower.

7. Rate the extent to which you get stressed with your work?
a) Highly stressed
b) Moderately stressed
c) Least stressed

10%

Highly stresed
Moderately stressed
34%
56% Least stressed

INTERPRETATION
The data obtained through this survey has revealed that most of the employees
do get stressed due to work. Again this needs to be looked after by the bank
authorities, at the earliest.

Page 107 of 119

 Serving to empower.

8. Rate the scope of growth in the role you are presently in?
a) Very high
b) High
c) Average
d) Poor

7% very high
23% high
49%
average
poor
21%

INTERPRETION
The responses obtained through this survey shows that most of the employees
feel that there is high scope for their growth in this Bank.
Bank

Page 108 of 119

 Serving to empower.

9. To what extent do your organisational responsibilities interfere with

your organisational life?
a) Highly
b) Moderately
c) Less
d) Not at all

4%

15%
Highly
52% Moderately
29%
Less
Not at all

INTERPRETATION
The data collected through the survey shows that most of the employees feel
that that their personal lives are getting affected because of their organisational
responsibilities.

Page 109 of 119

 Serving to empower.

10. Do you face any difficulty while performing your job?

a) Yes
b) No
c) Sometimes
d) Can’t say

5%
22% 34%
Yes
No
Sometimes
39% Cant say

INTERPRETATION
Most of the employees feel that they don’t face any difficulty while performing
their job.

Page 110 of 119

 Serving to empower.

11. Is their any kind of compensation facility available for you in case of
an accident?
a) Yes
b) No

Sales

25%

1st Qtr
2nd Qtr
75%

INTERPRETATION
The responses obtained during this survey shows that most of the employees
are not aware of the compensation facility provided to them in case of an
accident.

Page 111 of 119

 Serving to empower.

12. Rank the extent of transparency in the organisation for the

employees?
a) Highly transparent
b) Moderate transparent
c) Least transparent

10%
28% Highly transparent

Moderately
transparent
62%
Least transparent

INTERPRETATION
The responses obtained during the survey shows that most of the employees of
the organisation are moderately transparent for an employee.

Page 112 of 119

 Serving to empower.

13. Is there any kind of system for your feed back to your boss?
a) Yes
b) No
c)

Sales

25%

Yes

75% No

INTERPRETATION

The data collected during this survey shows that there is no proper system
available for giving feedback to their boss.

Page 113 of 119

 Serving to empower.

14. How frequently can you approach to the head of your organisation,
in case you want to?
a) Never
b) Sometimes
c) Often

Sales
3%

12% 23%

Never
Sometimes
Often
62% Anytime

INTERPRETATION

This survey has bought to light that not much of the employees can approach
their Boss.

Page 114 of 119

 Serving to empower.

15.What is the extent of employee privacy?

a) Privacy is highly maintained
b) Moderately maintained
c) Least maintained

14% Highly maintained

37%

Moderately
49% maintained
Least maintained

INTERPRETATION
On getting responses from the employees it is observed that the privacy of the
employees is maintained but not highly. This shows that the management of the
company has a lackadaisical attitude towards its employees.

Page 115 of 119

 Serving to empower.

16. Is there any particular grievance procedure to be followed by the

employees
a) Yes
b) No

35%

Yes
65%
No

INTERPRETATION
This survey has bought to light a very surprising data that very few employees
of the company are aware of the grievance procedure of the bank.This shows
that there is lack of information amongst the employees regarding the bank
itself.

Page 116 of 119

 Serving to empower.

Conclusion
The J&K banking industry currently appears to be at a cross roads, where the industry is
attempting to change perception of the services provided by it, amongst its customers. J&K
Bank offers a large no. of products for its customers that one way or the other is changing the
lives of the people in Kashmir valley and outside as well.
This project has led to the following conclusions;

Almost all the banks offer similar products with almost similar features but in order to
grab a major market, the bank focus more on its strategies to make them more
innovative.

To provide finance, bank looks keenly into the profitability and working processes of
the business.

The bank before financing the fresh project makes the possible analysis of the
industry and the company.

The bank also looks into the past and present position of the proprietor.

The evaluation by the bank relates not only to profitability but also to cash flows to
determine the capacity of the firm to pay interest charges and repayment of debt
installments.

If borrower had already taken the debt from the company in past years the bank also
looks in its past performance is checked whether the borrower had repayed the debt
amount or not.

On the basis of its financials, the bank is not showing good performance in its
working capital management.

The current liabilities of the bank are largely increasing and are exceeding the current
liabilities.

The earning capacity of the bank is not is low and has shown increase in the last three
years very poorly.

Page 117 of 119

 Serving to empower.

Recommendations;

The bank needs to look into its working capital management. It needs to
maintain its current assets and current liabilities.

The bank needs to focus on its operations so as to generate revenue from its
own business operations rather than on other comprehensive sources.

The bank needs to make complete analysis before investing as the bank is not
able to achieve a satisfactory return on its investments as the profit is not
sufficient.

There should be fast means of data verification and document generation so
that less time is taken in sanctioning the facility.

There is need to increase the staff members in order to reduce the work load of
the employees

If possible, bank should provide amenities to workers to improve morale.
Make certain they have a comfortable, clean break room with basic necessities
such as running water. Keep facilities such as bathrooms clean and stocked
with supplies.

There should be regular training and development programmes for the
employees which will make the more efficient and effective in their work

There should be a periodic feedback system in the bank.

The employees should be rewarded on their work which will make the
employees more interested in their work and will result in increasing the
efficiency of the organisation.

The bank need to focus more on the foreign market

Page 118 of 119

 Serving to empower.

BIBLIOGRAPHY

Books
Books
1. PANDEY I.M. “Financial Management
2. GUPTA SHASHI K., SHARMA R.K., “Management Accounting
and Business Finance”
3. CHANDRA PRASANNA,
PRASANNA “Projects (planning, analysis, financing,
implementation, review)”
4. KOTLER PHILLIP,
PHILLIP, “Research
“ methodology”

Journals
1. Annual reports of JK Bank

Sites
www.indianbanks.com
www.JK Bank.net
www.moneycontrol.com
www.wikipedia com

“Remembrance is the great pan for those whooooooo Remember”

“Promise breakers are worse than shoe makers”
Ahmad Mustafa’s
.

Page 119 of 119