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Annual Report 2008-09

BANKING CODES AND STANDARDS

BOARD OF INDIA

www.bcsbi.org.in

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PUBLISHED BY

K.V. Subba Rao

Chief Executive OfficerBanking Codes and Standards Board of IndiaC-7, Reserve Bank of India BuildingBandra Kurla Complex

Mumbai- 400051

Phone : (022) 26573715Fax : (022) 26573719

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Banking Codes and Standards Board of India

Governing Council

ChairmanK.J. Udeshi

Members

M. M. ChitaleChartered Accountant

204 and 205 Agarwal Shyamkamal-

A Building, Vile Parle (East)Mumbai-400 057

Cyrus GuzderChairman and Managing Director

AFL Pvt. Ltd., AFL HouseLok Bharati Complex Marol Maroshi Road

Andheri (East)Mumbai-400 059

V. P. Shetty ChairmanJM Financial Asset Reconstruction

Company Private Limited141, Maker Chambers III, Nariman Point Mumbai-400 021

Dr. Ajit RanadeGroup Chief Economist

Aditya Birla Management Corporation Pvt. Ltd.2-C, S.K. Ahire Marg, Worli

Mumbai-400 030

K. V. Subba RaoChief Executive Officer

Banking Codes and Standards Board of India C-7, Reserve Bank of India Building

Bandra-Kurla Complex

Mumbai-400 051

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Smt. Usha Thorat, Deputy Governor, RBI interacting with the BCSBI staff during her visit to BCSBI.

Shri K.V. Subba Rao, CEO, BCSBI addressing the gathering at the workshop on the Code forMSEs held at Lucknow.

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ANNUAL REPORT OF THE BANKING CODES AND STANDARDSBOARD OF INDIA (BCSBI)

2008-09

The year 2008-09 witnessed the failure of some major financial institutions and banks in theU.S., U.K. and elsewhere, which were considered as too big to fail, causing a world-widefinancial crisis. It is against this background of turbulence, stress and uncertainty in financialmarkets that the performance of member banks of the BCSBI has to be evaluated vis--vistheir commitments of rendering quality banking services of a minimum standard to theirindividual customers and micro and small enterprises.

Governing Council

2. The Governing Council (G.C.) which is vested with the general supervision, directionand control of the working of the BCSBI, held seven meetings during the year. On the

expiry of its first term of three years, the Reserve Bank of India (RBI) reconstituted theCouncil in February 2009 in accordance with the Rules and Regulations of the BCSBI.Shri S. Divakara and Shri S.R. Kolarkar completed their term as members of the G.C.and Dr. Ajit Ranade was inducted as a member. The term of the reconstituted Governing Council will be for two years up to February 17, 2011. The G.C. plays a crucial anddecisive role in the review of the monitoring and enforcement of the Codes by member

banks and BCSBI places on record the invaluable services rendered by S/Shri Divakara and Kolarkar.

Membership and Subscription

3.1 During the year the G.C. approved an amendment to the Banking Code Rules facilitating

the admission of scheduled Urban Co-operative Banks (UCBs) and Regional Rural Banks(RRBs) as members of the BCSBI. Four banks viz. Saraswat Co-operative Bank Ltd.,Bharat Co-operative Bank (Mumbai) Ltd., State Bank of Mauritius and Nagar UrbanCo-operative Bank Ltd. were admitted as members with effect from April 1, 2009 andthe membership of 2 more scheduled UCBs and 7 RRBs is in process. Two banks viz.State Bank of Saurashtra and Centurion Bank of Punjab ceased to be memberssubsequent to their merger with the State Bank of India and HDFC Bank Ltd., respectively.List of members is set out in Annex I.

3.2 During the year, BCSBI collected Rs.413.44 lakh by way of registration and membershipfee from member banks, which includes fee of Rs.200.03 lakh for the year 2008-09 andRs.213.41 lakh as fee for the year 2009-10. With a view to strengthening the corpus of BCSBI and achieving self-sustainability, it has been decided to raise the target forcollection of total annual membership fee from Rs.200.00 lakh for the year 2008-09 toRs.250.00 lakh for the year 2009-10.

Investment of Funds

4. During the year, the Investment Committee of the G.C. held three meetings and reviewedthe Investment Policy. As on March 31, 2009, the investments of the corpus stood at

Annual Report 2008-09Banking Codes and Standards Board of India

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Rs.809.60 lakh comprising Rs.358.40 lakh in Government Securities and Rs.451.20lakh in term deposits with banks. During the year the total income from investmentsamounted to Rs. 49.84 lakh.

Code of Banks Commitment to Micro and Small Enterprises (MSEs)

5.1 The Third Census of Small Enterprises conducted by Small Industries Development Organisation in 2001-02 had brought out that an overwhelming 95% of micro enterprisesare outside the purview of institutional financial structure. It was, therefore, felt necessary to come out with specific commitments from member banks to address the financialneeds of MSEs and the Code of Banks Commitment to MSEs was launched by the thenHonble Union Finance Minister, Shri P. Chidambaram on May 31, 2008 and all member

banks have since adopted this Code.

5.2 The Code was given wide publicity in the English and Regional Press by the RBI andBCSBI embarked upon a nation-wide campaign to disseminate the Code both among the MSEs and the field level functionaries of banks. Workshops were organized with theactive support of member banks at Thane (Maharashtra), Kochi (Kerala), Chennai andMadurai (Tamilnadu), New Delhi, Kolkata (West Bengal), Guwahati (Assam), Belgaumand Hubli (Karnataka), Cuttack (Orissa), Agra and Lucknow(Uttar Pradesh) and Indore(Madhya Pradesh). The response to these workshops was overwhelming and the BCSBIis grateful to the member banks and the industry associations for the support extendedin this endeavour. For dissemination of the MSE Code, the BCSBI also utilized theforum of the State Level Inter Institutional Committee meetings (Empowered Committeeon SMEs) convened by the RBI which are attended by senior State Government functionaries and the federations representing the interests of MSEs.

5.3 In pursuance of the commitments made in the Code, a simple, standardized and easy tounderstand loan application form for MSEs was finalized by IBA in consultation withthe BCSBI and copies of the same were circulated among the banks for expeditiousadoption. This is one of the main requirements of MSEs and it is expected that theprocess of adoption of this standardized loan application form for MSEs by all member

banks would be completed shortly.

Sample survey of implementation of Code provisions

6.1 As some time had lapsed since the launch of the Code in July 2006 and the subsequent compliance discussions with member banks, it was felt appropriate to review the Code

compliance by the banks. After extensive deliberations on the mode of review, 268 branches spread across the five metro cities, viz., Mumbai, Delhi, Kolkata, Chennai andHyderabad including 70 percent of the branches covered in the previous survey whoseadherence to the Code was not considered satisfactory, were visited by representativesof BCSBI in October November, 2008. The scope of these visits included disseminationof both the Codes, display of Information on basic banking services, opening of NoFrills accounts, provision of basic banking services, lending practices, grievance redressalsystems etc.


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A section of the audience at the workshop for MSEs held at Thane.

Smt. K.J. Udeshi, Chairman, BCSBI addressing the gathering at the conference on Facilitating Bank Financeto Micro & Small Enterprises held at New Delhi.

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A section of the audience at the workshop for MSEs held at Madurai.

Smt. K.J. Udeshi, Chairman, BCSBI delivering a talk on Banking Services to Customersat the Bottom of the Pyramid at Kochi.

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6.2 Though only a very small sample of bank branches was selected for the review, considering the fact that most of these branches had a poor track record of adherence to the Code,the findings of the Review visits reveal some perceptible improvement in overall adherenceto the provisions of the Code over that observed during the last survey. Some of theimportant findings are set out in Annex II.

Opening of No Frills account Incognito Visits to Branches

7.1 In accordance with the commitment made in the Code of Banks Commitment toCustomers, member banks are required to make available basic banking No Frills a/cseither with nil or very low minimum balance. The RBI has also provided enough flexibility in the requirements of documents of identity and proof of address in the KYC guidelinesissued to banks so as to facilitate the opening of these accounts.

7.2 With a view to ascertain the factual position about fulfilment of commitments at the ground level, BCSBI randomly selected 44 branches of 26 banks in public, private and

foreign sectors located in Mumbai and carried out incognito visits. The findings revealedthat the general awareness about the No Frills accounts and relaxed KYC requirementsin respect of the said accounts was insufficient among the staff of the banks visited. Thestaff at most of the branches were not proactive in opening such accounts. The findingsat Annex III have been shared with the banks for taking remedial action.

Monitoring of Compliance

8. Monitoring of the compliance by member banks of the Code Commitments is donethrough the scrutiny of the Annual Statement of Compliance submitted by banks,reflecting the position as on December 31, of each year. This years performance of compliance has been significantly better than in the previous year inasmuch as almost all banks have now adopted the model policies on Cheque Collection, GrievanceRedressal, Security Repossession and Collection of Dues, Compensation etc. There are

gaps observed and the concerned banks are making efforts to comply with the Codes. What is, however, of concern is the ground realities as brought out through the fieldsurveys and incognito visits and the declarations by banks in the Annual Compliancestatements. Members are expected to be ethical and fair in their self-appraisal.

Complaints and Their Redressal

9.1 Public grievances, is one of the effective tools through which BCSBI carries out its ongoing monitoring of banks compliance with the Code provisions. BCSBI by design and mandate,is not a redressal agency to arbitrate on a dispute between an individual and his banker.But grievances ventilated by individuals do sometimes throw up systemic deficiencies.They enable BCSBI to monitor Code Compliances at systemic or bank specific level.Therefore, while complaints received by BCSBI are forwarded for redressal to theCustomer Service Department, RBI, those complaints which are indicative of systemicdeficiencies are followed up with the respective bank/s.

9.2. During the year under report, 571 complaints were received against member banks. A large number of these were episodic grievances, and only 165 complaints were of systemic


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import or impinged upon breach of code provisions. A profile of these complaints is set out in Annex IV.

Review of the Code of Banks Commitment to Customers

10. As per the commitment made in the Code, BCSBI has commenced the process of review of the Code. The objective of the review is to enhance the minimum standards of customerservice rendered by banks by bringing about greater transparency. Suggestions in thisregard have been sought from member banks, RBI, IBA, the Banking Ombudsmen,

various bodies representing the interest of banks customers and civil society organisations. Suggestions have also been invited from members of the public througha notice on the BCSBI website. The process of review of the Code is expected to becompleted by June 30,2009.

Training Support

11. BCSBI continued to extend faculty support to training establishments of member banksto help their staff understand and appreciate the provisions of the Codes and theirimplementation.

Newsletter

12. The inaugural Issue of BCSBIs Quarterly Newsletter has been circulated to reach out toeach and every branch of member banks.

Way Ahead

13.1 Reflecting his commitment to customer service, the Governor, RBI, Dr. D. Subbarao has

in his message in the inaugural issue of the BCSBI Newsletter emphasized : Customer, they say, is the king. This becomes a reality only if customers areenabled to enforce accountability. But they cannot do so if information is not disseminated or where information asymmetries operate.

On the way ahead, therefore, our focus will be on increased efforts at achieving greaterawareness among customers and bankers about their rights and obligations enshrinedin the two Codes as also to bring about greater transparency in banks systems andpractices through the Revised Code of Banks Commitment to Customers which willcome into effect this year. BCSBI will also encourage scheduled UCBs and RRBs to

become members of BCSBI to ensure that a larger section of the banking public benefits

from improved quality of customer service. As heretofore, the approach of BCSBI towards bringing about qualitative improvements in customer service would be collaborative by enlisting the support of RBI, IBA and member banks.

13.2 World over, there is a marked shift on tightening regulation, and concerns are being voiced about the efficacy of self-regulation of banks, particularly in the context of protection of customers rights. In this scenario, the challenges ahead, for BCSBI, arequite formidable and members have to collectively demonstrate that self-regulation doeshave a useful role.

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13.3 The expansion in membership of the BCSBI brings with it the concomitant issue of monitoring of compliance and HR issues within the BCSBI. These issues have to beseen in the context of BCSBI having to gradually wean itself from the staff and financialsupport extended by RBI. The present financing arrangements for the BCSBI wouldcontinue up to 2011. The financial viability of the BCSBI would need to be examined inthe ensuing months so as to ensure that the BCSBI is able to more effectively fulfil therole assigned to it. In this context the BCSBI would work closely with the RBI and IBA to

work out viable financing arrangement beyond 2011. These and other governance issues would need to be addressed by the G.C. of the BCSBI on the way ahead.

Acknowledgements

14. The BCSBI is grateful for the support extended by RBI, IBA and member banks. TheBCSBI is thankful to the State Bank of India, Bank of Baroda, Indian Overseas Bank,Bank of India and State Bank of Indore and various industry associations for the logistic

support extended to BCSBI for the conduct of the workshops for dissemination of theCode of Banks Commitment to Micro & Small Enterprises.

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A section of the audience at the workshop for MSEs held at Agra.

A section of the audience at the workshop for MSEs held at Lucknow.

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01 AB Bank Ltd.02 ABN AMRO Bank N.V.03 Allahabad Bank04 Andhra Bank05 Axis Bank Ltd.06 Bank of America 07 Bank of Baroda 08 Bank of Ceylon09 Bank of India 10 Bank of Maharashtra 11 Bank of Novascotia 12 Barclays Bank P L C

13 BNP Paribas14 Calyon Bank15 Canara Bank16 Central Bank of India 17 Citibank N A 18 City Union Bank19 Corporation Bank20 DBS Bank Ltd.21 Dena Bank22 Deutsche Bank23 Development Credit Bank Ltd.24 HDFC Bank Ltd.25 ICICI Bank Ltd.26 IDBI Bank Ltd.27 Indian Bank28 Indian Overseas Bank29 Indusind Bank30 ING Vysya Bank Ltd.31 J P Morgan Chase Bank N A 32 Karnataka Bank Ltd.33 Kotak Mahindra Bank Ltd.34 Krung Thai Bank P C L35 Mashreq Bank Psc36 Oman International Bank S.A.O.G.37 Oriental Bank of Commerce

Annex IList of banks which have enrolled as members of the BCSBI

38 Punjab National Bank39 SBI Commercial & International Bank Ltd.40 Shinhan Bank41 Societe Generale42 Sonali Bank43 Standard Chartered Bank44 State Bank of Bikaner And Jaipur45 State Bank of Hyderabad46 State Bank of India 47 State Bank of Indore48 State Bank of Mauritius49 State Bank of Mysore

50 State Bank of Patiala 51 State Bank of Travancore52 Syndicate Bank53 Tamilnad Mercantile Bank Ltd.54 The Bank of Rajasthan Ltd.55 The Catholic Syrian Bank Ltd.56 The Dhanalakshmi Bank Ltd.57 The Federal Bank Ltd.58 The Hongkong And Shanghai Banking

Corporation Ltd.59 The Jammu & Kashmir Bank60 The Karur Vysya Bank61 The Lakshmi Vilas Bank Ltd.

62 The Nainital Bank Ltd.63 The Ratnakar Bank Ltd.64 The South Indian Bank Ltd.65 UCO Bank66 Union Bank of India 67 United Bank of India 68 Vijaya Bank69 Yes Bank Ltd.

Scheduled Urban Cooperative banks01 The Bharat Co-operative Bank (Mumbai) Ltd.02 Nagar Urban Co-operative Bank Ltd.03 The Saraswat Co-operative Bank Ltd.

S. No. Name of the Bank

Scheduled Commercial banksScheduled Commercial banks

S. No. Name of the Bank

1. Scheduled Urban Cooperative banksa. The Cosmos Cooperative Bank Ltd.

b. The Karad Urban Cooperative Bank Ltd.

2. Regional Rural banksa. Saurashtra Gramin Bank

b. South Malabar Gramin Bankc. Vananchal Gramin Bankd. Kashi Gomti Samyut Gramin Banke. Karnataka Vikas Grameena Bankf. Pandyan Grama Bankg. Prathama Bank

List of banks which have registered for membership of the BCSBI


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Smt. K.J. Udeshi, Chairman, BCSBI addressing the gathering at the workshop organized by Karnataka Chamber of Commerce and Industry at Hubli.

A section of the audience at the workshop for MSEs held at Indore.

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11

1. Comparative positionThe comparative position of adherence to select provisions of the Code as per thefindings of the survey held in year 2007 and the branch visits conducted in 2008 arepresented below.

Annex IIProgress in banks' compliance with the Code of Bank's Commitment to Customers

Branch Visit Findings

S. No. Item Description Percentage of branchesadhering to the Code Provisions

As per survey As per branchof 2007 visits in 2008

Dissemination of the Code1. Availability of copies of Code at branches 56 872. Display of information about availability of Code 12 56

Transparency and Customer Education3. Display of address and contact details of Banking

Ombudsman 69 754. Display of contact details of Compliance Officer/Nodal Officer 58 585. Availability of copy of customer centric policies

e.g. Security Repossession Policy. 29 74Grievance Redressal

6. Redressal of grievance of customers within 15 days. 88 93Lending

7. Issue of acknowledgement for receipt of loan application 60 728. Conveying terms and conditions of loans sanctioned in

writing to the borrowers. 76 95

2. Centre-wise position

Centre-wise position of adherence to select Code provisions as observed during the branch visits in year 2008 are presented in the charts below:

(a) Position of branches displaying information about availability of copiesof the Code.

(b) Position of branches making availablecopies of the Code to their customers.

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3. Bank Group-wise status

Bank Group-wise position of adherence to select Code provisions as observed during the branch visits in year 2008 are presented in the charts below:

12

(c) Position of branches acknowledging receipt of complaints from customers.

(d) Position of branches paying compensa-tion as per their policy without waiting for a demand from customers.

(a) Status of branches d isp laying information about availability of copies of the Code.

(b) Status of branches making availablecopies of the Code to their customers.

(c) Status of branches acknowledging receipt of complaints from customers.

(d) Position of branches paying compensa-tion as per their policy without waiting for a demand from customers.

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Annex IIIFindings of Incognito Visits to Branches Opening of No Frills Accounts

(i) Awareness of No-Frills Accounts

(a) Awareness about the relaxed KYC norms for opening No-Frills account was very poor. Officials in over 63 percent of branches visited were unaware of the instructionsof RBI on the simplified procedure for opening No-Frills accounts. Lack of awareness

was pronounced at the branches of SBI & associates as well as PSBs. The staff at all the 5 branches of SBI and Associates, 14 of the 21 branches of PSBs and 3 of the 4 branches of foreign banks were unaware about No-Frills accounts and relatedinformation. Private Sector banks were relatively more informed as 8 out of 14

branches were aware about the facility of No-Frills accounts.

(b) Although some banks branches have displayed information on these accounts, asper regulatory requirement, none of the dealing staff members was aware of thesame. The staff was not even aware of the basic features like minimum balance

requirement.(ii) Opening of No Frills Account

(a) At the outset, most of the branches did not come forward to open No Frills accountsin the names of persons of small means, say a maid or a driver. When it wasmentioned that there are some savings accounts with limited facilities for people

with lower income, the staff expressed unwillingness to open such account, if thecustomer was not in a position to produce document such as PAN card, Voters ID,Postal ID, etc. as proof of identity and address. While none of the branches of foreign banks and those in SBI group visited were willing to open No Frills accounts

with relaxed KYC documents, the response from branches of PSBs (other than SBI group) and Private banks was mixed. While in the case of PSBs 12 out of 21 branches

showed unwillingness to open these accounts, 5 of 9 new private sector banks, 3 of 5 old private sector banks were unwilling to open such accounts.

(b) Branches of some of the banks showed preparedness to open a No Frills account inthe name of a driver having a valid Driving Licence as proof of identity. These branchesalso showed willingness to accept a declaration supported by documents from theperson with whom the prospective account holder resides, as proof of address.

(iii) Format of Account Opening Form (AOF)

(a) With the exception of two banks, no other bank has introduced simplified account opening form for No Frills account.

(b) A solitary bank provided in the account opening form, information about simplified

KYC norms.(c) In spite of the relaxations in KYC requirements as per regulatory guidelines, the

account opening forms of 25 banks did not contain any information about therequirement of documents under simplified KYC norms. The account opening formof these banks indicated only the usual documents required such as Passport, PANCard, Voter ID, Postal ID, Electricity/Telephone Bill, Ration Card, etc. as proof insupport of identity and address, thereby excluding a large section of population not in possession of such documents from opening a No Frills account.

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Sr. No. Nature of complaints 2007-08 2008-09

01 Deposit accounts 55 11102 Credit/Debit Cards 109 20503 Pension 2 704 Tariff Schedule & Service Charges 23 1805 Cheque Collection/Clearing Cycle 22 2106 Foreign Exchange Services 4 407 ATM related services 2 508 Compensation Policy 09 Unsolicited telemarketing 5 10 Loans & Advances (including Collection of dues, etc.) 59 13211 Grievance Redressal mechanism 17 21

12 Miscellaneous 38 47 Total 336 571

Annex IV Profile of Complaints


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Statement of Account for the year

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LOONKER & CO. 8-Dhun Mahal, Garden RoadChartered Accountants Colaba, Mumbai 400 039

Tel : 2282 5580; 2285 6740Mobile: 93246 14750.

Auditors Report

We have audited the Balance Sheet of Banking Codes and Standards Board of India as at 31 st

March 2009 and the Income and Expenditure account for the year ended on that date annexedthereto. These financial statements are the responsibility of the trustees of the Board. Ourresponsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India.Those standards require that we plan and perform the audit to obtain reasonable assuranceabout whether the financial statements are free of material misstatement. An audit includesexamining, on a test basis, evidence supporting the amounts and disclosures in the financialstatements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

We report that:

i) We have obtained all the information and explanations, which to the best of our knowledgeand belief were necessary for the purpose of the audit.

ii) In our opinion, proper books of account as required by the law have been kept by theTrust so far as it appears from our examination of such books.

iii) The Balance Sheet and Income & Expenditure Account dealt with by this report are inagreement with the books of account.

iv) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give a true and fair view in conformity with the accounting principles generally accepted in India:-

- in the case of Balance Sheet of the state of affairs of the above named trust as at 31 st

March 2009 and

- in the case of Income & Expenditure account of the surplus for the accounting yearended on that date.

For M/s. Loonker & Co.Chartered Accountants

Place : Mumbai Sd/-Date: May 5, 2009 (S. C. Loonker)

Partner(Membership No:10135)

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As per our report of even date

Sd/-(K.J. Udeshi) M/s.Loonker & Co.Chairman Chartered Accountants

Sd/- Sd/-(K.V. Subba Rao) PartnerChief Executive Officer AuditorsBanking Codes and Standards Board of India

Place: Mumbai Place: MumbaiDate: May 5, 2009 Date: May 5, 2009

BANKING CODES AND STANDARDS BOARD OF INDIA Balance Sheet as on March 31, 2009

As onMarch 31,

2008

PROPERTY & ASSETS As onMarch 31,

2009

( As per Schedule VIII of Bombay Public Trusts Act, 1950) (Amount in Rupees)

As onMarch 31,

2009

As onMarch 31,

2008

FUNDS AND LIABILITES

Trust Funds or Corpus

35,723,000 Balance as per last Balance Sheet 35,723,000

Add: Contribution received during the year 41,344,000 77,067,000

Other earmarked funds

- Public Awareness Fund

3,299,000 Balance as per last Balance Sheet 3,299,000

Add: Tfd. From Income & Exp. A/c

- From Opening Balance 1,873

- From Current Year 4,984,796 8,285,669

Loans (Secured or unsecured)

Liabilities-

104,058 For advances from RBI 152,451

Income and Exp. Account

1,873 Balance as per last Balance Sheet 1,873

Less: Appropriation, if any (1,873)

39,127,931 Total 85,505,120

Immovable properties

Investments

29,873,356 Govt.securities (cost)-Annex-I 35,839,604

Furniture and fixtures

Loans (Secured or unsecured)

Advances -

To others-

12,640 - Trade Mark 12,640

152,689 - Tax Deducted at Source 217,560

1,500 - Deposit (MTNL) 1,500

2,772 - Premium on GOI Securities 8,053 239,753

Income Outstanding -

1,527,711 - Interest 3,151,055

Cash and Bank Balances-

7,556,568 - In current account or fixeddeposit account- Annex II 46,273,268

695 - Stamps 1,440 46,274,708

39,127,931 Total 85,505,120

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( As per Part III - Schedule VIII of Bombay Public Trusts Act, 1950) (Amount in Rupees)

Date and year Kind of investments Full description such as name of the Face Value Cost Rate of Remarksof preparation company, distinctive Nos. of shares interest

and certificates, type of shares, etc. borne by Date of redemption or repayment investments

1 2 3 4 5 6 7

At the (i) Shares beginning of (ii) Bonds and Debentures the year (as on (ii) Deposits

April 1, 2008) (iv) Others (v) Public Securities (a) 7.37% GOI Securities 2014 14,500,000 14,118,650 7.37%

(b)8.07% GOI Securities 2017 1,480,000 1,484,292 8.07%(c) 7.49% GOI Securities 2017 12,000,000 11,470,414 7.49%(d) 7.99% GOI Securities 2017 2,800,000 2,800,000 7.99%

30,780,000 29,873,356

Increase (a) 7.59% GOI Securities 2016 2,500,000 2,466,248 7.59%during the year (b) 8.24% GOI Securities 2017 3,500,000 3,500,000 8.24%

(2008-09) 6,000,000 5,966,248Decrease during the year(2008-09)

Total at the end of the year (as on March 31, 2009) 36,780,000 35,839,604

BANKING CODES AND STANDARDS BOARD OF INDIA Schedule of Investments belonging to the Trust as on March 31. 2009

Annex-I

Annex-II

As on Bank Accounts As onMarch 31, 2008 March 31, 2009

In Savings Account

2,856 - ICICI Bank 1,030,638In Current Account

73,712 - Central Bank of India 123,031In Fixed Deposits

1,300,000 - HDFC Bank 4,200,0006,000,000 - HSBC Bank

180,000 - Kotak Mahindra Bank 5,300,000- Axis Bank 5,000,000- Citibank 3,775,000- ICICI Bank 7,100,000- IDBI Bank 7,500,000- Karnataka Bank 3,598,453- Karur Vysya Bank 2,921,146- Yes Bank 5,725,000[All accounts in the name of Banking Codes and Standards Board of India]

7,556,568 46,273,268

BANKING CODES AND STANDARDS BOARD OF INDIA Annexure to Balance Sheet as on March 31, 2009

(Amount in Rupees)

As per our report of even dateSd/-(K.J. Udeshi) M/s. Loonker & Co.Chairman Chartered Accountants



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As per our report of even date

Sd/-(K.J. Udeshi) M/s.Loonker & Co.Chairman Chartered Accountants

Sd/- Sd/-(K.V. Subba Rao) Partner

Chief Executive Officer AuditorsBanking Codes and Standards Board of India


BANKING CODES AND STANDARDS BOARD OF INDIA Income and Expenditure Account for the year ended March 31,2009

[As per Schedule IX of Bombay Public Trusts Act, 1950] (Amount in Rupees)

Year

endedMarch 31,

2008

EXPENDITURE Year

endedMarch 31,

2009

To expenditure in respect of properties

To establishment expenses

To remuneration to trustees

Legal expenses

Audit fees

To contribution and fees

To amount written off

308 - Preimum on Govt. Securities 929

To Miscellaneous expenses

To Depreciation

To Amounts transferred to Reserve

2,799,000 - Public Awareness Fund 4,984,796

To Expenditure on objects of the Trust

551 To surplus carried over to Balance Sheet

2,799,859 Total 4,985,725

Year

endedMarch 31,

2008

Year

endedMarch 31,

2009

By Rent

By Interest

2,092,303 - On securities 2,759,527

704,836 - On bank account 2,224,528 4,984,055

By Dividend

By Donations in cash or kind

By Grants

2,720 By Income from other sources 1,670

By Transfer from Reserve

By Deficit carried over to Balance Sheet

2,799,859 Total 4,985,725

INCOME

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Notes forming part of accounts for the year ended March 31, 2009

1. The financial statements are prepared on accrual basis.

2. Expenses Borne by Reserve Bank of India

The Income and Expenditure Account does not show any expenses since all the expenseshave been borne by the Reserve Bank of India. The Reserve Bank has agreed to extendfinancial support to the Board by way of meeting its full expenses for the first five years of operation and providing furnished Office accommodation & Office equipments, etc. freeof cost at the Reserve Bank of India Building, Bandra Kurla Complex, Mumbai-400 051.

3. Advance for Expenses from Reserve Bank of IndiaIn addition to the unspent opening balance of Rs.1,04,058/- shown as advance from ReserveBank of India on the liability side in Balance Sheet, Reserve Bank of India had advanceda sum of Rs.2,00,000/- to the Board by cheque on September 19,2008 for meeting minorestablishment expenses. The unspent closing balance of Rs. 1,52,451/- is shown as advancefrom Reserve Bank of India on the liability side in Balance Sheet.

4. Corpus FundDuring the first five years of operation, the Board would build up its Corpus fromregistration and membership fees so that when the RBI funding is phased out, the Board

would become self-financing. The member banks have also desired that the entirecontribution made by them in the form of registration fees and membership fees be creditedto the Corpus of the Banking Codes and Standards Board of India. Therefore, theregistration fees and the membership fees are credited to the Corpus Fund, during thefirst five years of operation.

5. Public Awareness FundThe Board has transferred Rs. 49,86,669/- to Public Awareness Fund to be spent for thispurpose within the next five years.

6. Previous Years figuresThe corresponding figures for the previous year are re-grouped / re-classified, wherevernecessary.

As per our report of even dateSd/-(K.J. Udeshi) M/s.Loonker & Co.Chairman Chartered Accountants



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AR08-09

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Transcript of AR08-09