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Interview with Mr. Deepak Kumar Guha

"Good management consists in showing average people how to do the work of superior people." JohnD. Rockefeller

Position Held : Dy. General Manager, Central Zone, Bank of India.

Q1 . In the wake of the current sub-prime crisis, is it right to say that theIndian banks are safe?

Ans. The current subprime crisis hasnt caused much impact on Indian banks.The total exposure of the Indian banks is very less, which I believe is not asignificant amount to create a havoc. Indian banks were prudent and cautiousin their approach towards investments in foreign markets.

Q2. How effective were the policies of RBI in tackling the present crisis? Ans. RBI should be appreciated for its pre-emptive measures. It has been very strict with the banks having foreign exposure/presence and has kept a strong

vigil over the movement of funds both internally and externally.

Q3 .What changes do you see in the Indian banking space with regard to theentry of foreign banks?

Ans. Indian markets are grossly under served and we are way behind in theachievement of the target set by the Prime Minister for financial inclusion.Foreign banks will bring in better technology and better banking practices

which will drive the Indian banks to perform and serve better. I foresee a lotof activities especially M&A, and joint ventures in the coming years.

Q4. What are the major components which affect the pricing of loan in any bank? Ans. There are many factors which affect the pricing of a loan. Primarily, the basic components are the expected return on equity for the bank, CRR,servicing cost of the particular loan, deposit insurance premium cost for the

bank, expected loan loss rate (associated risk), idle balances allocated by the bank and finally the securitization of the loan. These components havedifferent costs across different banks. Thus you will find banks chargingdifferent rates for different loans.

Q5. Can you tell us what factors lead to the determination of PLR in different bank?

Ans. As per the RBI norms every bank is supposed to determine its PLR basedon the marginal cost of funds. The marginal cost of funds here would meanthe provisioning requirements of the bank, capital charges of the bank, itsprofit margin requirements, cost of funds (fixed deposit, savings a/c, currenta/c, NRE a/c, NRO a/c, NRNR a/c ), changes in benchmark rates, servicingcost and deposit insurance premium. Apart from these the kind of loans the

banks offer to different sectors also play a crucial role in determining its PLR.

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Buzz Word

Fast Market: A financial market that has a combination of high volatility and heavy trading.First In, Still Here FISH: An accounting buzzword thatdescribe when companies still have inventory on hand that is notbeing sold due to inattention or obsolescence.

Drip Feed: The process of investing on an ongoing basis in asmall but growing firm over a period of time. Essentially, a dripfeed results in a start-up company receiving capital contributions.

Book Quotes:

Economy is too late when you are at thebottom of your purse. Seneca If all the economists were laid end to end,they'd never reach a conclusion -GeorgBernard Shaw Stressing output is the key to improving

productivity, while looking to increase activitycan result in just the opposite. - AndrewGrove

"Wealth is not a matter of intelligence it's a matter of inspiration." Jim Rohn

Company Review: TARGET INDIA The second-largest general merchandiser in the U.S., known for innovation, great design andcommunity involvement, has a thriving presence in Bangalore. In May 2005, Target began itsoperations in Indiafirst at Embassy Prime in Bangalore, then expanding to the Embassy Golf Links.

Target India started as a technology unit providing technology solutions and developing systems forthe retail domain. After a period of rapid growth, they now support all business units of the Targetretail operations. Target has nearly 350,000 team members.

Target India is the global extension of a $59 billion business that is one of the most admiredcompanies in the United States. Located in Bangalore, Target India fulfills a unique role in ensuringthe success of this widely loved retailer that ranks 33 in the Fortune 500 List2007.

Raising the bar and setting precedents. Target India has been appraised at CMMI Level 3, a quality certification that places them among the

best in the industry. The Six Sigma system of improving business process is practiced at Target India, and new team

members are certified with Yellow Belt- within 90 days. Target Gift Cards set the industry standard in variety and design, making gift-giving easy and fun for

their guests. Their Clear Rx pharmacy system delivers prescriptions in an easy-to-read, color-coded bottle,

minimizing the chance of taking the wrong dose or confusing medications between family members.

LIFE AT TARGET

The energy is contagious. Once you're part of their team, you can't help but get swept up in : Speed-is-life Working at smart pace Goals are clear, challenging and met every day through collaboration and teamwork.

CAREERS AT TARGET

Ambitious growth plans combined with an array of training and development opportunities make

Target the best in the industry for career advancement. Through the annual review process and usingtools like the Individual Development Plan, you can work with your supervisor to plan your career, setand achieve your goals, and grow along with the company. The Benefits include : Earn while you learn Ongoing company-sponsored classes. Customizing your professional development.

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Did you Know?

The US marintroduced circuibreakers after the crashof Oct. 1987. The circubreakers halt trading for30 minutes when thDow falls by 350 poinor more, and for 1 hou

when the Dow falls 55 points or more. Thescame into use for thfirst time on Oct. 271997 when the DJItumbled 554, the biggest

points drop in history. In 1618 it w

estimated that 3000 tonsof spices were boughin what is now Indiand the surroundingarea. The spices cosabout 91,000. By thtime they reached theeastern Mediterraneanthey were worth almos800,000! So it is easy tsee why tradincompanies were simportant. In 1641 the Japanesthrew out moEuropean trading firmson religious groundsHowever, the DutchEast India Companyhave no missionarieand are allowed to stayon the conditions that"company officers visiEdo once a year, turnsomersaults in thstreet, spit on the Crossand pay rent i

peppercorns."

Page

INVESTORS CHECK . Contd.

Don't try to buy at the bottom and sell at the top. It can't be done except by liars.- Bernard Baruch

If you have $1,000 in your trading account, the maximum risk you should takein any trade is 3% of your trading capital. Because your capital is $1,000, 3% of your capital is $30. If you are stopped out of this trade and you are trading amini lot, you will lose $15. But if you are prepared to risk $30, you can actually trade two mini lots and get the power and benefit of some leverage. If you wereonly trading standard lots, this trade would not be possible because a 15-piploss, as per this example, would be $150, which is 15% of your $1,000 trading capital. Given a risk tolerance of 3% of the portfolio, this is too much risk forone trade.Mini lots allow a trader to adjust the amount of effective leverage used in eachtrade. With mini contracts, you can trade the equivalent of one standard lot by simply trading 10 minis. If you only want to trade a half of a standard lot, youcan do so by buying five mini lots.

CONGRATULATIONS FOR PLACEMENTS!!!

STATE BANK OF INDIA

ELIZABETH M C SAAGAR TUSHAR

RAHUL SINGH AVIJIT THAKRAL ASHISH PODDAR

PRATEEK

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SUKRITI SHIVANI SASMIT

READIMINDS

SUNIL GUPTA

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COMMENTS

Its a good initiative, students are putting good effort to make it a successful one. Its a good initiative, students are putting good effort to make it a successful one. Its a good initiative, students are putting good effort to make it a successful one. Its a good initiative, students are putting good effort to make it a successful one.

Prof. RAMACHANDRAN GProf. RAMACHANDRAN GProf. RAMACHANDRAN GProf. RAMACHANDRAN G....

Chaanakya helps CUIM students in keeping up with the time and the economy at bothChaanakya helps CUIM students in keeping up with the time and the economy at bothChaanakya helps CUIM students in keeping up with the time and the economy at bothChaanakya helps CUIM students in keeping up with the time and the economy at bothand macro levels. and macro levels. and macro levels. and macro levels. CYRILSAMUEL FINANCE IIyrCYRILSAMUEL FINANCE IIyrCYRILSAMUEL FINANCE IIyrCYRILSAMUEL FINANCE IIyr

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Contributions made by 2nd year:

Editing/Compiling Arihant PatawariNews Chetan P.

ShriyaCompany Review Mohammad NimakwalaInvestors Check/Stock Ratnas SebinInterview Jerry Coordination Fouzia Tarannum B.

Contributions made by 1st year:

Editing/Compiling Gyanesh Shroff Did you know, Quiz Megha Garg Quotes, Book Quotes Maria FernandesGraphs, Buzzwords Paloma Lobo

Indices Paulomi BreganzaCrosswords HiteshCommunication Archana

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