Chapter No

1.1 Introduction

1.2 Significance of the Study

1.3 Scope Of the Study

1.4 Period of the research study

1.5 Area of the research study

1.6 Selection of Sample

1.7 Objectives of the research Study

1.8 Hypothesis of the Study

1.9 Research Methodology

1.9.1 Primary data

1.9.2 Secondary data

1.10 Limitations of the research study

1.11 Analysis and interpretation of data

1.12 Chapter Scheme

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CHAPTER NO - 1

INTRODUCTION AND RESEARCH METHODOLOGY

This chapter includes the Introductory part and Research Methodology . It also contains , choice of the topic, Significance of the study , scope of the study , period of the study , Area of the study , Methodology , Hypothesis of the study , Objectives of the study , Limitations of the study etc .

1.1 : Introduction :- All banks in modern time have a key role to play in the process of Economic Development by promoting the savings by encouraging and channeling investment . All modern Economies are money economies are money economies , Banking is gradually changing its covers of action . The use of computers of the fast developing information technology has started attiring the density of banks by developing enterprises and including managerial and business skill in men . Previously Indian banks were keener to provide services by offering business by branch expansion . An Organization can be evaluated by its distribution of profits to the shareholders and by better and quick services to the customers . Revolution in communication technology has sought to change the face of banking as it directly affects the speed of transfer of money . The use of computers or the fast information technology has started altering the design of banks. All this has made banking to be not only a money related business but also more as business information and financial transactions in modern times technology which has become a capital for survival of business organizations. Today we think in term of virtual branches or multimedia banks, a bank branch can be set up on the net. A depositor can view his account he can order cheque books and go through the services offered by bank without going to the bank. In the case of some banks the officers are linked via satellite allowing the customers instant access to all their branches. In Pune district area modern technology has contributed significantly towards achieving quickness. There is a trend towards multimedia banking because it offers several advantages as compared to traditional banking convenience , facilitating electronic bill payment etc. The researcher would like to study “ An Analytical Study of Bank Of

Maharashtra Pune with Special reference to Junnar Branch “. and would like to suggest some possible Solutions for long term survival of these units . In modern times technology has become critical for survival of

business organizations. Banks are not exceptions to this. An organization can be evaluated by its ability to deliver profits to its shareholders for this it is necessary to give better and quick Services to the customers.

1.2 Significance of the Study :- The research topic is significant because it helps to find out the activities conducted by nationalized banks & over all banking sector. Nationalized banks have greatly contributed to disbursement of funds to agriculture sector, industrial sector and citizen of the country. The research study focuses on the contribution made by the nationalized banks to the development of rural area, urban area, agriculture area sector as well as industrial sector. The researcher intends to study how the nationalized banking sector help to development country terms of the education, economic conditions, living standards and employability. The researcher also wanted to study of working functionalized banking sector, in Pune District. Nationalized job in the distribution of funds and amenities among the rural and urban communities. This has attracted the attention of many international agencies, bodies and foreign government authorities. The nationalized banks in India have been working as functionaries for human resource development. The role played by the Indian nationalized banking sector have been recognized and appreciated by the national and international agencies. So it is national and international status of Indian nationalized banking sector and the topic “An Analytical Study of Bank Of Maharashtra Pune with Special reference to Junnar Branch”. has a significant one

1.3 Scope Of the Study:- The present study “An Analytical Study of Bank Of Maharashtra Pune with Special reference to Junnar Branch.” is the first of its kind.

The word “Taluka” has been used for the “Tehsil”.

The study covers working, functioning and technological trends in banking sector especially in nationalized banks, in Otur, junnar of junnar Tahsil, over a period from April 2007 to March 2010 that is for Four years.

The said study is related to the overall problems, performance, functioning and technological trends of banking sector especially in nationalized banks, in Otur,junnar of junnar Tahsil.

It is need of the hour to know the impact of technological trends in banking sector on the working transacting on banking sector as well as on customers of the banks and evaluate the problems of banks and customers. Technological changes in banking sector may become more beneficial to the banking sector as well as to the customers of the banks, if technological changes are properly managed and efficiently adopted by the nationalized banks.

The present study will help to the planners and policy makers for making decisions regarding the baking sector.

1.4 Period of the research study :- The Present research study covers the period from April 2007 to March 2010, that is for four Years.

1.5 Area of the research study :- The area of present research study is Pune District, but the researcher selected only Bank of Maharashtra Junnar.

1.6 Selection of Sample :-

There were 37 and 2 main Branch of Bank of Maharashtra in Maharashtra and out of these 21 Bank of Maharashtra in Pune District.

The researcher selected only Junnar Branch of Bank of Maharashtra Pune.

1.7 Objectives of the research study :-

1. The Main objective is to study An Analytical study of Bank of Maharashtra Pune with special reference to Junnar Branch.

2. To take review of the modern technological trends of banking sector in general and nationalized banks in particular.

3. To study the adoption of modern technological trends in banking sector of Pune District

4. To review the growth taken place in the nationalized banking sector, due to modern technological trends

5. To study the impact of technological trends on bank workers efficiency.

1.8 Hypothesis of the study:-

1. Due to the effective use of modern technologies in banking sector, the efficiency of the banks is improved.

2. Technology has dominated the working of nationalized banks and has ultimately resulted in increase in its accuracy and profitability.

1.9 Research Methodology :- The research study is based on the analysis and interpretation of primary and secondary data.

1.9.1 primary Data :- Primary data is first hand data fresh and authentic for the purpose of research study . To collect the required primary data , the following techniques of data collection were used.

a) Questionnaires.b) Field Visit.c) Interviews.d) Attending the meetings.

a) Questionnaires:-

Two set of Questionnaires were prepared to collect detailed information for research work.

The Questionnaires have been prepared in English as well as in Marathi language purposely for convenience as most of the customers of the Banks are from taluka place and from small villages are Marathi speakers and readers.

In order to obtain reliable and correct information, the Questionnaires have been prepared in English as well as in Marathi language.

Set -1-The Questionnaire for Manager of Bank Of Maharashtra :-

The second set of Questionnaires is prepared for manager of the nationalized Banks. For collecting the data regarding the working progress, functioning and management of nationalized banks, these Questionnaires were personally handed over to manager of the nationalized Banks, and collected the information by filling the Questionnaires.

Set-2- The Questionnaire for Customers ‘ of Bank Of Maharashtra :-

The second set of Questionnaire was prepared for the customers of the nationalized Banks for knowing the overall opinion and observation of the customers.

b) Field Visits:- The field survey was conducted from 1st April 2007 to 31st March 2010.The reference year for the selected nationalized Banks was from April 2007 to March 2010. The Four years data was collected for analysis and interpretation of data. Even though data is collected for three years, information and new trends up to 31st March 2010 are also taken in to account.

The field visits were also arranged to know the actual functions and various service rendered by the sample branches of nationalized Banks.

c) Interviews :- In order to know the working, functions and services rendered by the sample branches of nationalized Banks the interview technique was adopted.

The managers of the banks, passing officers, cashiers and the senior officers of the banks were interviewed. The researcher has personally visited to selected branches of nationalized banks and collected the information by filling the questionnaires. The researcher has observed the banks records of these branches of nationalized Banks to get additional information which was not covered by the questionnaire. The researcher has got the personal talk with the Director, Manager, passing officers, Cashiers, Senior staff of the selected branches of the nationalized banks.

d) Meetings :- The researcher attended the Annual meeting of Share holders of the selected banks, Meetings of the staff members of the banks and observed the proceedings of the meetings and collected required data for study.

1.9.2 Secondary Data :- For collecting secondary data the researcher visited the following libraries. Arts, Commerce and Science Collage, Narayangaon In Secondary sources existing records, that is published and un-published record was used, it includes following record.1. Annual reports, statements including Trial Balance, Profit and loss Account and Balance Sheets of selected Branches of nationalized banks.2. Audit Reports of selected Branches of nationalized banks for the said research study.3. Standard Reference Books on Banking and Finance.4. Research Papers & Research Articles on the subject of Banking and Finance.5. Various articles regarding Banking and Finance and also on information Technology.

1.10 Limitations of The Research Study:- The present research study “An Analytical Study of Bank of Maharashtra Pune with special reference to Junnar Branch” covers the period from April 2007 to March 2010, that is, for Four years only. The study is restricted to Pune District in Junnar Tehsil .

1.11 Analysis and Interpretation of Data :- After the collection of the research data, an analysis of data interpretation of the result are necessary. Analysis of the data is to be made with reference to the purpose of the study and its possible bearing on scientific discovery. An analysis is made with reference to the research problem at hand and with reference to the hypothesis to be tested. For analysis and interpretation of data the researcher has used the following statistical methods. Tabulation Classification Simple Average Graphs Ratios Percentage

1.12 Chapter Scheme :-Chapter -1 – Introduction and Research Methodology :- This chapter includes the introductory part and research methodology. It also contains, choice of the topic, significance of the study, scope of the study, period of the study, area of the study, methodology, hypothesis of the study, objectives of the study, limitations of the study etc.

Chapter -2- Development of Banking Sector in India:- This chapter includes development of Banking Sector1. Meaning and Definition of banks2. Origin of the word and concept of banking3. Banking in India 4. Nationalized Banking Sector 5. Banking sector in Pune District and Junnar Tehsil.

Chapter -3- Profile of Junnar Tehsil :-

This chapter focuses on the profile of study area i.e Junnar Tehsil. a) General Information b) Financial Position of Banks c) Branches of Bank of Maharashtra d) Services of Bank of Maharashtrae) Loan Scheme of Bank of Maharashtra

Chapter-4- Analysis and Interpretation of Data : - This chapter includes analysis and interpretation of collected primary data and also collected information.

Chapter -5- Conclusions and Suggestions :- This chapter includes conclusions

drawn by the researcher from the primary data suggestions given by the researcher.

References :-

1. Dr. Mukund Mahajan , Fundamental Of Banking, Nirali Prakashan.

2. Dr. H R Machiraju, Indian Financial System, Vikas Publishing House Pvt. Ltd.

3. Web Site: www.bankofmaharashtra.com

Chapter :- 2

DEVELOPMENT OF BANKING SECTOR IN INDIA

1.1 Introduction :- All Modern economies are money economies i.e. , they use money in all their economic activities . As a result in all modern economies , banks perform a variety of useful functions . In advanced countries , as 8 much as 85 to 90 per cent of the total money supply is in the form of bank deposits or bank money as it sometimes called . Even in a developing country like India , bank money accounts for more than half the total supply of money . In modern Production persons who save and persons who have plans of investment are not the same . It , therefore, becomes necessary for some agency to act as an intermediary between these two sets of people , and banks act as this of agency . In fact , in every economic activities like production , distribution , Exchange & Consumption , banks have an important role to play. Moreover, banks in modern times have a key role to play in the process of economic development by promoting savings, by encouraging and channeling investment by developing enterprises, and by inculcating managerial and business skills in men. It is no exaggeration to say that banks are nothing less than the backbone of an advanced or developing economy.

2.2 Meaning and Definitions of a Banks :- In spite of the great importance of a modern economy, the fact remains that the term ‘bank’ can more easily be understood than defined. Various attempts have been made so far at defining a bank. But all these definitions have been objected to on one ground or the other, with the result that no single definition can be quoted as fully satisfactory and universally acceptable. This difficulty of defining a bank can, however, be explained by underlining the fact that a bank is an evolutionary concept. In other words, a contemporary bank is different from the banks in the past. Future banks will also be different from present banks. These differences arise in respect of the organization, structure and functions of a bank. The institution of banking goes on adapting itself to the needs of the times. As we cannot foresee the functions banks are likely to perform in the future, any definition offered by us may prove to be inadequate. Banks will outgrow any definition. As such, any definition is bound to become outdated due to the structural and functional changes experienced by banking in due course.

Definitions of Bank :-1) Macleod :

According to Macleod,” The essential business of a ‘banker’ is to buy money and debts, by creating other debts. A banker is, therefore, essentially a dealer in debts, or credit”.

2) Sir John Paget : Sir John Paget’s opinion is that “No person or body corporate, or otherwise, can be a banker who does not take deposit accounts, take current accounts, issue and pay cheques drawn upon himself, and collect cheques, crossed and uncrossed for his customers….”.

3) Prof. Sayers : According to Prof. Sayers,” Banks are institutions whose debts usually referred to as ‘bank deposits’ are commonly accepted in final settlement of other people’s debts.”

2.3 Origin of the Word and Concept of Banking:- We have understood the meaning and scope of the term ‘bank’ in the light of the various functions that a bank performs today. But the present character of a bank has evolved through time. It is, therefore, necessary to follow this process of the evolution of banking. According to one view, the English word Bank owes its origin to the Italian words Banco, Bancus, Banque or Banc. All these words mean a ‘bench’ upon which the mediaeval European money lenders and money-changers used to display their coins. This business was practiced by the Jews in Europe. These Jews possibly flourished most in Italy in the early years; and hence the Italian word came into vogue. In England, banking as an independent business dates back to the Fourteenth Century. In those days, the Jews of Lombardy, in England, used to transact their business on benches at market places. One can further point to a historical fact in support of this view. When a banker was unable to meet his obligations to his customers, according to the custom, his ‘banco’ was destroyed or broken to pieces. Hence, the word ‘bankrupt’ was derived. Thus, it appears that the word bank is derived from the Italian words banco, bancus, etc. There are others, however, who trace the word to another Italian word. According to Gilbert, and Macleod, the word bank is derived from the Italian word Monte (Which itself owes its origin to the Latin word Mons) which means a ‘mound’ or a ‘heap’. This word implies that one requires a heap of money for carrying on the banking business.

We are obviously not interested in the controversy over the etymology of the word ‘bank’. We are interested in the origin of banking and whichever view is accepted, the fact remains that this derivation takes banking back to the Middle Ages.

2.4 Banking in India :- Banking is believed to have existed in the most crude form, in India, as early as the Vedic period. Money-leading was common practice in India, with the ancient people. The puranas and smritis mention about money-changing and money-lending. Manusmriti contains references regarding deposits, pledges, policy on loan and rates of interest. Kautiliya’s Arthashatra also speaks extensively on banking in ancient India. India had trade relations with most of the countries of the world. To facilitate trade, some banking facilities were obviously essential and were provided by traditional Indian bankers. Within the country also, trade and industry were widespread and highly developed though decentralized and on a small scale. Because internal trade and industry were prosperous, credit needs were felt and adequately met by Indian bankers. These bankers are known as Indigenous bankers and they were the fore-runners of modern banking institutions because they performed the functions of accepting deposits, giving loans and facilitating trade by dealing in hundis. When the British came to India ( during the 17th century ), there were several banking firms in the country doing traditional Indian banking business and even the British merchants took their help. The Indigenous Bankers represented proprietorship or joint family firms. They worked with their own funds, through they did accept deposits also. For money-leading, promissory notes were used. Hundis or bills of exchange were also common. They facilitated remittance they combined money-lending and some other business like trading with India. Modern organized banking in India, however, can be traced back to the 17th century when the British traders established trade relations with India. British Agency Houses can be said to have started modern banking in India, in the second half of the 18th century. In 1770, the Hindustan bank was established at Kolkata. It was associated with the well-known agency house ‘Alexander and company’. The Bengal Bank established in 1784 was not related to any agency house. In 1786, the General bank of India got established as the first joint stock bank with limited liability. All these banks, however, were short-lived and their business-coverage also was limited and unbalanced.

Banking in India, in the modern sense, can be said to have mode a sound beginning with the establishment of the Bank of Kolkata in 1806.The East India Company gave a charter of banking business to this bank in 1809 and it was renamed as Bank of Bengal. With the full patronage and support of the East India Company, the Bank of Bengal started the issue of paper currency in 1823 and was permitted to open branches in 1840. In this year, it was given the status of the presidency bank of Bengal. In 1840 and 1843, the presidency Banks of Mumbai and Kolkata respectively were established. In 1920, these three banks were amalgamated to form the Imperial Bank of India, which became the State Bank of India after its nationalization in 1955. The Indian Joint Stock banks came to be established at the end of the last entry. In 1881, the Audh Commercial Bank was established, while the Punjab, National Bank was formed in 1894 and peoples’ Bank in 1901. During the period 1906-1911, several commercial banks like the Bank of India, Central Bank of India, Bank of Baroda, Bank of Mysore etc. were established. Thus the rise and growth of modern joint stock banking in India can be traced to the beginning of the present century. Thus, it is clear that the origin of modern banking is to be found in the business of merchants, money-lenders and goldsmiths. They gradually adopted various functions of a bank. With an increase in the volume of business, the business passed on from individuals to public limited companies. Because such institutions were necessary in the years following the industrial and commercial revolutions, they experienced rapid growth during the second half of the nineteenth Century. With the turn of the Century, the growth of banking had already become a necessary concomitant of economic development and in many ways a precondition of economic development .

2.5 Nationalized Banking :- Nationalized banking is banking organized on a nationalized basis. By nationalized organization, we mean a “voluntary concern, with equitable participation and control among all concerned in any enterprise.” Prof. Paul Lambert has defined a nationalized bank as an “enterprise formed and directed by an association of users, applying within itself the rules of democracy and directly intended to serve both its own members and the community as a whole.”

Organizational features of Nationalized Banking :-1) A nationalized organization is an enterprise aiming at a certain business.2) AS an association of users, nationalized banking is organized by those

who themselves require credit.3) It works according to the rules of democracy. In other words, it works

through a board of directors. The directors are elected on the basis of one vote per member, irrespective of the number of shares purchased by him.

4) It is intended to serve both (a) its own members, and (b) community as a whole.

5) Every nationalized bank works for a given objective like serving the needs of commerce or agriculture or the proletariat, etc.

6) Except the above mentioned field of specialization in the matter of credit, all the other functions performed by a nationalized bank are similar to those of any other bank.

2.6 Nationalized Banks :- Nationalized banks cater to the needs of the rural economy. The most important occupation in rural areas is agriculture. Naturally, most of the nationalized banks are predominantly agricultural credit banks. Besides agricultural credit, these banks also provide credit to agro-based and other rural or village industries.

Objective of Nationalized Bank :- 1) To associate themselves with the programmers of production.2) To lend money adequately, i.e., to lend adequate amounts all producers

agriculturists and others in the rural areas. 3) To a limited extent, to cater also to the consumption needs of smaller

producers and workers after ensuring their abilities their abilities of repayment.

4) To attract local saving in the form of share capital as well as fixed and other types of deposits and thereby to inculcate the habits of thrift and saving.

5) To supervise the use of loans and to ensure proper utilization of loans.6) To recover the loans and to see that they are repaid punctually. 7) Wherever necessary, to undertake to distribute fertilizers, seeds, raw

materials, machinery, etc., to small rural industries.8) To finance the marketing of the produce; and

2.7 Urban Nationalized Banks:- As early as 1915, the Maclogan Committee on nationalized pointed out that “urban credit societies might serve a useful purpose in training the upper and middle classes to understand ordinary banking principles”. In 1931, the Central Banking Enquiry Committee, in India, recommended that “limited liability nationalized bank, generally known as urban banks, should be established wherever necessary facilities and conditions exist, for the benefit of these classes of the population.

Object and Functions of Urban Nationalized Bank :- 1) To attract deposits from the public- members as well as non-members;2) To advance loans to members- individual and institutional;3) To finance hire – purchase schemes, and help its members in purchasing

domestic and other requirements;4) To undertake the collection of bills- accepted or endorsed by members; 5) To arrange for the safe custody of valuable documents, etc., of members;6) To provide other facilities as are provided by commercial banks.

2.8 Structure of nationalized credit Institutions:-

Nationalized Credit Institutions

Urban Nationalized Banks (1,872) Nationalized Credit Institutions (1,872)

Short – Term Structure (1,06,131) Long- Term Structure (788)

State nationalized Agriculture & Rural Development Banks (20)

Primary nationalized Agriculture & Rural Development Banks (768)

State nationalized Banks (31)

Central nationalized Banks (365)

Primary Agricultural Credit Societies (1,05735)

2.9 Banking Sector in Maharashtra Pune District and Junnar Tahasil :-

Sr. No

Nationalized Banks in Maharashtra

Nationalized Banks in Pune District

Nationalized Banks in Junnar Tahashil

1 Bank Of India Bank Of India Bank Of India

2 Bank Of Maharashtra Bank Of Maharashtra Bank Of Maharashtra

3 State Bank Of India State Bank Of India State Bank Of India

4 Canara Bank Canara Bank Canara Bank

5 Central Bank Of India Central Bank Of India Central Bank Of India

6 Bank Of Baroda Bank Of Baroda Bank Of Baroda

7 Allahabad Bank Allahabad Bank

8 Andhra Bank UCO Bank

9 Corporation Bank Union Bank Of India

10 Dena Bank Syndicate Bank

11 Indian Bank Dena Bank

12 Indian Overseas Bank Indian Overseas Bank

13 Oriental Bank Of Commerce Oriental Bank Of Commerce

14 Punjab & Sind Bank Punjab National Bank

15 Punjab National Bank Vijaya Bank

16 State Bank Of Bikaner

17 State Bank Of Hydrabad

18 State Bank Of Mysore

19 State Bank Of Patiala

20 State Bank Of Saurashtra

21 State Bank Of Travancore

22 Syndicate Bank

23 The State Bank Of Indore

24 UCO Bank

25 Union Bank Of India

26 United Bank Of India

27 Vijaya Bank

Total 27 15 6

CHAPTER NO. – 3

PROFILE OF BANK OF MAHARASHTRA PUNE

3.1 Introduction :-

Bank of Maharashtra Pune was established on 16th Nov 1935 by people committed to social cause in Pune city. The bank has always kept the goal of helping Economically weaker section of the society and has carved a place as bank of masses and not only for classes.

The bank has made steady progress in past 50+Years and under the present board of director has taken leap towards progress through technology. The Banks Financial status is as follows.

Deposits Rs.2825.22 Crores

Advances Rs. 1789.67 Crores

Share Capital Rs. 60.86 Crores

Bank of Maharashtra Pune is making steady progress and the shareholders, customers, employees, and well-wishers are integral part of this progress. Their involvement and contribution is immense. Today the bank has a wide network of 37 Branches and 2 Extension counters spread across 7 Districts of Maharashtra.

All this progress has lead towards RBI including the bank in second schedule and from 1st September 1988. Bank of Maharashtra Pune is functional as Scheduled nationalized Bank. As a result Bank is accepting deposits from Government and Semi Government corporations similarly Government and Semi Government corporations accept Bank’s drafts.

Our Bank has implemented core Banking Technology in 2005 which resulted in prompt and accurate services to customers. Now customers can do the transactions from any branch through any Branch Banking facility.

Bank provide extensive training through its own training centre o its employees from time to time for upgrading their skills for better customer service. The training centre is also recognized by the co-operative department of Govt. of Maharashtra. Training is also imported to the employer of the nationalized Banks.

Social Commitment :- Bank Ltd., Pune has from inception committed itself

to the social cause. In 1961 when Pune was engulfed in flood, Bank provided financial support to the victims. In 1987 Maharashtra was reeling under draught, in most parts there was acute shortage of food, water, fodder for animals.

Bank of maharashtra Ltd., Pune recognizing need to overcome this situation had collected funds in large scale. Draught relief committee was formed with participation from Shareholders, customers and employees. Through this committee draught relief work like providing food to students, camp for animals etc. was done. Drinking water facility was provided at Dhamapur and Gowalwadi villages in Sangameshwar in Ratnagiri district. For this purpose 3200 foot pipeline was led and a water tank was constructed.

On 30th September 1993 Latur in Maharashtra was shocked with massive earthquake. Bank of maharashtra Ltd., Pune provided immediate relief work and medical facility. Bank was actively involved in reconstructing of Kavathe village in Ausa of Osmanabad dist.

To help the victims of such natural calamities bank has established a trust under the banner as ‘Maharashtra Bank Pune Aapattee Vimochan Samit

An award has been instituted is the memory of Late Moropant Pingale, an RSS Pracharak and the main inspiration in the establishment of the Bank. The award annually given goes to an institution and not to an individual engaged in social service.

3.2 General Information :-1) Name Of Bank :-

Bank of maharashtra .

2) Date Of Establishment :-

16th Nov 1935

3) Main Office :- 1444, Shukravar-Peth, Torale Bajirao Road, Pune – 411002

4) No of Branches With Main Office :- 37 + 2 Main Office

5) Registered No & Date :- 13184/1949 Date- 18-10-1949

6) Area of study:- Junnar Branch

7) Bank Financial Status :- 1) Deposite :- 2825.22 Crores2) Advances :- 1789.67 Crores3) Share Capital :- 60.86 Crores

8) Related Bank RBI :- Including 1st Sep 1988

9) Investment :- 1056.08 Crores

10) Shareholder :-

115584

11) Nominal Shareholder :- 22471

12) Name of the Chairman and Directors :-

Chairman : Shri Arvind Keshav Khaladkar

Vice- Chairman : Shri Sanjay Mukund Lele

Directors : Shri Jagdish Laxman Kadam

: Shri Biru Ranu Khomane

: Shri Suresh Gopal Bhagwat

: Shri Sudhir Rajaram Pandit

: Shri. Sunil Gundopant Mutalik

:Dr (Smt.) Madhura Mukesh Kasbekar

: Smt Bhagyashree Suresh Chitale

: Shri Mahendra Mahadeo Pawar

: Shri Ramdas Vithoba Shinde

: Shri Arun Sarjerao Mokashi

: Shri Manohar Yashwant Bhide

:Shri Rajendra Madhusudan Phadke

: Shri Kishor Kanchanlal Shah

: Shri Hemant Anant Joshi

:Shri Ramchandra Krishnaji Chillal

CEO : Shri Vijay Purushottam Bhave

3.3 Financial Position Of Bank :-

31st March 2010 Year ended

3.3.1 Subscribed and Paid up Share Capital :- 608641 Thousand

3.3.2 Reserve Fund :- 1995219 Thousand

3.3.3 Deposits :-

a) Saving :- 6727370 Thousand

b) Current :- 1309601 Thousand

c) Fixed :- 19483433 Thousand

d) Other :- 731785 Thousand

3.3.4 Loan :- a) Secured :- 17282166 Thousand

b) Unsecured :- 614539 Thousand

3.3.5 Investment :- a) PDCC :- 218512 Thousandb) Maharashtra Bank :- 92741 Thousandc) Other :- 12497752 Thousand

3.4 Branches of Bank of maharashtra :- Two main branches and thirty seven branches of Bank of maharashtra .List of Branches of Bank of maharashtra in Pune District :-1) Bajirao Road Branch 2) Shivajinagar Branch 3) Bhavani Peth Branch4) Karve Road Branch 5) Fergusson College Road Branch 6) Tilak Road Branch 7) Shaniwar Narayan Peth Branch 8) Market Yard Branch 9) Karve Nagar Branch 10) Sahakarnagar Branch 11) Sinhagad Road 12) Pimpri Branch 13) Chinchwadgaon Branch 14) Chinchwad Station Branch 15) Talegaon Dabhade Branch 16) Talegaon Station Branch 17) Bhor Branch 18) Ghodnadi Branch 19) Indapur Branch

20) Junnar Branch 21) Otur Branch

3.5 Services Of Bank of maharashtra :-

The following Services are provided in Bank of maharashtra

1) ATM Card 2) Debit Card 3) Credit Card 4) Net Banking 5) Pan Card Registration Service6) Payable at Par Cheque Book7) Any Branch Banking 8) S.M.S Alerts 9) Lobby Banking :-

Bank of maharashtra Ltd., Pune, in its constant effort to provide its customers with innovative technological services, has introduced Lobby Banking ( Multimedia Touch Screen Kiosks). This touch screen kiosk enables the customers to access a range of information regarding their accounts. The non customer public can obtain general information. Basically the Lobby Banking facility is an additional information source to the customer and public.

Information

Balance Enquiry

Statement Enquiry

Outward Clearing Cheque Status

Outward Clearing Query

Deposit Interest Rates Query

Deposit Maturity Value Query

Deposit/Advance Schemes Query

10) S.M.S Banking :-

Bank of maharashtra Ltd., Pune in an attempt to fulfill the ever rising needs of banks customers, has launched SMS banking facility for it's customers.SMS Banking brings Banking to your fingertips.

With SMS, you can perform a wide range of query based transactions from your mobile phone at a very low cost.

SMS Banking Services

Check account balances

Recent transactions

11) Tele Banking Services :- We have introduced Telebanking facility for our

csutomers and the customer can get his/her account details over the phone.

Process for using telebanking is as under- The customer is required to dial 020-24474003 and follow the instruction which are as follows- The customer is required to select the language option ( select 1 for English; 2 for Hindi and 3 for Marathi); Then the customer has to enter the customer number, followed by his/her PIN followed by the branch code, account type and account number. The customer is then given the following options for his desired account 1. Balance details; 2. Recent transactions; 5. Change PIN; 6. Select different account; 7. Fax on demand; 8. Clearing cheque details; 9. Repeat above opt

12) Fax on Demand :- We have introduced Telebanking facility for our

customers. The customers can receive his/her statement of account on fax by using option of fax in the telebanking facility.For telebankingfacility you need to deal 020-24474003. If you have fax modern installed on your desktop PC, you may download the fax on your PC.

13) Transaction Alerts :- The technobased facility is intoduced for the customers to inform the details of transactions on their mobile through SMS. Alerts are sent online as soon as transaction is effected on the account. Through this facility Term Deposit Maturity alerts are sent on the date of maturity.

3.6 Loan Scheme of Bank of maharashtra Ltd :- 1) Bank of Maharashtra Vehicle 2) Bank of Maharashtra Housing 3) Bank of Maharashtra Computer4) Bank of Maharashtra Gold 5) Bank of Maharashtra Educational6) Bank of Maharashtra Consumer Durables Loan Scheme7) Bank of Maharashtra Udyam Vikas 8) Bank of Maharashtra Paryatan9) Bank of Maharashtra Varadhasta

CHAPTER NO.- 4

ANALYSIS AND INTERPRETATION OF DATA

4.1. Introduction :-

Financial Statement analysis is a meaningful interpretation of financial statements in order to meet the information requirements of the parties who use such financial information.

The primary use of financial statement are evaluating past performance and predicting future performance and both these are faculties by comparisons. The purpose of evaluating such financial statement is different from person to person depending upon it’s relationship. These statements are required not only for the management of it’s own evaluation and decision making but also for internal control and overall performance of the firm financial statement analysis is the same part of the large information processing system.

The users of financial information included.

Management :- For day to day decision making and also performance evaluation.Shareholders :- For analyzing performance profitability and financial position prospective investors require track record of performance.Lenders Banks and Financial Institutions :- For determining financial position of the company debit service coverage etc.Suppliers :- To determine the credit worthiness of the company in order to grant credit.Customers :- To know the general business viability before entering in to long term contracts and arrangements.Research Scholars :- For study research and analysis purpose. Financial statement include the loss account or income and expenditure account and the balance sheet. This statement are prepared to show the result of operation learning period though the profit and loss and the period thought profit and loss in of the period thought the balance sheet.

4.2 - Statement Showing Assets and Liabilities Rs. Lakhs

Sr. No

Particulars (Liabilities)

2007 2008 2009 2010

1 Capital:- Authorized Capital Subscribed & Paid up Capital

5000.003060.22

5000.003731.42

10000.005018.98

10000.006086.41

2 Reserve Fund & Other Reserve

27096.92

19813.40

18655.84

19952.19

3 Deposit & Other A/C 185196.67

217218.77

244559.48

282521.89

4 Borrowings 6000.00

6000.00

5 Bills For Collection 449.67 618.88

542.86

233.27

6 Branch Adjustment 198.83 1859.93

- -

7 Unapplied Interest on Non Performing Assets

30514.56

18342.58

17301.40

17017.43

8 Deferred Tax Liability

19.40 9.08 7.84 -

9 Interest Payable 473.66 512.78

553.31

717.23

10 Other Liabilities 1926.26

1488.26

1684.80

2501.83

11 Amalgamated Bank Collection A/C

78.89 78.89 78.89 78.89

Total 249015.11

263674.03

294403.44

335109.17

Sr. No

Particulars (Assets) 2007 2008 2009 2010

1 Cash & Balance With Banks

13437.60

17130.58

19052.36

19167.78

2 Balance With Other Banks

2862.34

4929.38

6552.80

3314.15

3 Investment 65474.77

79590.59

84843.73

105608.10

4 Advances 120279.53

126576.66

154274.46

178967.04

5 Interest Receivable 32002.10

20454.37

19439.63

19408.38

6 Bills Receivable 449.67 618.88

542.86

233.27

7 Branch Adjustment - - 146.79

12.31

8 Premises 4293.98

4194.64

4095.81

3960.70

9 Fixed Assets 764.72 664.64

746.20

933.97

10 Other Assets 1733.75

2573.56

732.89

730.30

11 Deferred Tax Assets 726.30 726.30

- 734.42

12 Amalgamated Bank Collection A/C

78.89 78.89 78.89 78.89

13 Profit & Loss A/C 6911.42

6135.50

3896.96

1959.85

Total 249015.11

263674.03

294403.44

335109.17

4.3 – Calculation Of Various Ratio’s :-

4.3.1 Current Ratio :-

The current ratio is computed by using the following formula.

Formula :-

Current Ratio = Current Assets Current Liabilities

Current Assets normally include Cash, Bank , Sundry Debtors, Stock ,and current liabilities consists of sundry creditors, Short Term Loan and Advances. All obligations maturing with in amount year are included income current liabilities. Thus Current Ratio shows how readily the current obligations can be met.

a) Current Ratio = Current Assets

(2007) Current Liabilities

= 137029.14

32440.81

= 4.22 : 1

b) Current Ratio = Current Assets


= 149255.50

19830.84

= 7.52 : 1

c) Current Ratio = Current Assets


= 180422.48

18986.20

= 9.50: 1

d) Current Ratio = Current Assets


= 201682.24

19519.24

= 10.33 : 1

4.3.2 – Liquid Ratio :-

The Liquid ratio is computed by using the following formula.

Formula :-

Liquid Ratio = Liquid Assets Liquid Liabilities

The Liquid Ratio indicates the relation of ‘Liquid assets’. Quick or liquid assets include all current assets, except stock and pre-paid expenses whereas liquid liabilities include all current liabilities except overdraft and accrued expenses.

a) Liquid Ratio = Liquid Assets

(2007) Liquid Liabilities

= 137029.14 1926.25

= 71.13 : 1

b) Liquid Ratio = Liquid Assets


= 149255.50

1488.26

= 100.28 : 1

c) Liquid Ratio = Liquid Assets


= 180422.48

1684.80

= 107.08 : 1

d) Liquid Ratio = Liquid Assets


= 201682.24

2501.81

= 80.61 : 1

4.3.3 – Proprietary Ratio :-

The Proprietary ratio is computed by using the following formula.

Formula :-

Proprietary Ratio = Proprietary Fund X 100 Total Assets

Proprietary Ratio is also known as ‘Worth Debt’.’ Net Worth to Total Assets Ratio’, Equity Ratio’, Net Worth Ratio’, Proprietary Ratio is test of the financial and credit strength of the business. It relates share holder funds to total assets. i.e. total funds. This ratio determines the long term or ultimate solvency of the company.

a) Proprietary Ratio = Proprietary Fund X 100 (2007) Total Assets

= 31,817.49 x 100

249015.11

= 12.77%

b) Proprietary Ratio = Proprietary Fund X 100 (2008) Total Assets

= 24320.73 x 100

263674.03

= 9.22%

c) Proprietary Ratio = Proprietary Fund X 100

(2009) Total Assets

= 25913.36 x 100

294403.44

= 8.80%

d) Proprietary Ratio = Proprietary Fund X 100 (2010) Total Assets

= 27975.70 x 100

335109.17

= 8.34%

4.3.4 – Debt. Equity Ratio :-

The Debt Equity ratio is computed by using the following formula.

Formula :-

Debt Equity Ratio = Long Term Debt Shareholder’s Fund

This ratio expenses the relationship between the external equities and internal equities or the relationship between borrowed capital and owner’s capital.

a) Debt Equity Ratio = Long Term Debt

(2007) Shareholder’s Fund

= 1,85,196.67

31,817.49

= 5.82 : 1

b) Debt Equity Ratio = Long Term Debt


= 217218.77

24320.73

= 8.93 : 1

c) Debt Equity Ratio = Long Term Debt


= 244559.48

25913.36

= 9.43 : 1

d) Debt Equity Ratio = Long Term Debt


= 282521.89

27975.70

= 10.09 : 1

4.3.5 – Capital Gearing Ratio :-

The Capital Gearing ratio is computed by using the following formula.

Formula :-

Capital Gearing Ratio = Fixed Interest Bearing Securities Equity Share Capital

This ratio brings out the relationship between two types of capital i.e. capital carrying fixed rate of interest or fixed dividend and capital that does not carry rate of interest or fixed dividend. This ratio indicates the degree to which capital has been geared in the capital structure of a company. This ratio is known as Leverage Ratio’ or ‘Financial Leverage Ratio’ or Capital Structure Ratio’.

a) Capital Gearing Ratio = Fixed Interest Bearing Securities

(2007) Equity Share Capital

= 1,85,196.67

3060.22

= 60.51 : 1

b) Capital Gearing Ratio = Fixed Interest Bearing Securities


= 217218.77

3731.42

= 58.21 : 1

c) Capital Gearing Ratio = Fixed Interest Bearing Securities


= 244559.48

5018.98

= 48.72 : 1

d) Capital Gearing Ratio = Fixed Interest Bearing Securities


= 282521.89

6086.41

= 46.41 : 1

4.4 Analysis Of Assets :-

4.4.1 Fixed Assets :-

The researcher collected the secondary data. i.e. Balance sheets of Bank of maharashtra Ltd from the year 2007-2010 for the said research study and analyzed it in following table 4.1

Table No. 4.1 :- Analysis of Fixed Assets

Sr. no

Year Fixed Assets Increase Or Decrease

Percentage Of Increase Or Decrease

1 2007 764.72

2 2008 664.64 (-) 100.08 15.05

3 2009 746.20 81.56 10.93

4 2010 933.97 187.77 20.10

Total 3109.53 369.41 46.08

Source :- Secondary Data

From the above table number 4.1, it is clear that, there is a decrease in fixed assets by Rs. 100.08 lakhs (15.05 Percent) in the year 2008.

There is a increase in fixed assets of Rs. 81.56 lakhs (10.93 Percent) in the year 2009.

There is a increase in fixed assets of Rs.187.77 lakhs (20.10 Percent) in the year 2010.

From the above findings the researcher came to know that, there is a fixed assets decrease, increase and increase during the year respectively.

Graphs No . 4.1 :-

2007 2008 2009 20100

100

200

300

400

500

600

700

800

900

1000

Fixed Assets Increase Or Decrease Percentage Of Increase Or Decrease

4.4.2 Investment :-

The researcher collected the secondary data. i.e. Balance sheets of Bank of Maharshtra Ltd from the year 2007-2010 for the said research study and analyzed it in following table 4.2

Table No. 4.2 :- Analysis of Investment

Sr. no

Year Investment Increase Or Decrease


1 2007 65,474.77

2 2008 79,590.59 14,115.82 17.73

3 2009 84,843.73 5,253.14 6.19

4 2010 1,05,608.10 20,764.37 19.66

Total 3,35,517.19 40,133.33 43.39


From the above table number 4.2, it is clear that, there is a increase in investment by Rs. 14,115.82 lakhs (17.73 Percent) in the year 2008.

There is a increase in investment of Rs. 5,253.14 lakhs (6.19 Percent) in the year 2009.

There is a increase in investment of Rs.20,764.37 lakhs (19.66 Percent) in the year 2010.

From the above findings the researcher came to know that, there is an investment of increase every year.

Graphs No. 4.2 :-

2007 2008 2009 20100.00

20,000.00

40,000.00

60,000.00

80,000.00

100,000.00

120,000.00

Investment Increase Or Decrease Percentage Of Increase Or Decrease

4.4.3 Cash and Bank Balance :-

The researcher collected the secondary data. i.e. Balance sheets of Bank of Maharashtra Ltd from the year 2007-2010 for the said research study and analyzed it in following table 4.3

Table No. 4.3 :- Analysis of Cash and Bank Balance

Sr. no

Year Cash and Bank Balance

Increase Or Decrease


1 2007 13,437.60

2 2008 17,130.58 3692.98 21.55

3 2009 19,052.36 1921.78 10.08

4 2010 19,167.78 115.42 0.60

Total 68,788.32 5,730.18 32.23


From the above table number 4.3, it is clear that, there is a increase in Cash and Bank Balance by Rs. 3,692.98 lakhs (21.55 Percent) in the year 2008.

There is a increase in Cash and Bank Balance of Rs. 1,921.78 lakhs (10.08 Percent) in the year 2009.

There is a increase in cash and bank balance of Rs.115.42 lakhs (0.60 Percent) in the year 2010.

From the above findings the researcher came to know that, there is a cash and bank balance increase every year.

Graphs No. 4.3

20072008

20092010

0.00

2,000.00

4,000.00

6,000.00

8,000.00

10,000.00

12,000.00

14,000.00

16,000.00

18,000.00

20,000.00

Cash and Bank Balance Increase Or Decrease Percentage Of Increase Or Decrease

4.5 Analysis of Liabilities :-

4.5.1 – Share Capital :- The researcher collected the secondary data. i.e. Balance sheets of Bank of Maharashtra Ltd from the year 2007-2010 for the said research study and analyzed it in following table 4.4

Table No. 4.4 :- Analysis of Share Capital

Sr. no

Year Share Capital Increase Or Decrease


1 2007 3,060.22

2 2008 3,731.42 671.20 17.38

3 2009 5,018.98 1,287.56 25.65

4 2010 6,086.41 1,067.43 17.53

Total 17,897.03 3,026.19 61.16


From the above table number 4.4, it is clear that, there is a increase in share capital by Rs. 671.20 lakhs (17.38 Percent) in the year 2008.

There is a increase in Share Capital of Rs. 1,287.56 lakhs (25.65 Percent) in the year 2009.

There is a increase in share capital of Rs.1,067.43 lakhs (17.53 Percent) in the year 2010.

From the above findings the researcher came to know that, there is a share capital increase every year.

Graphs No. 4.4

2007 2008 2009 20100.00

1,000.00

2,000.00

3,000.00

4,000.00

5,000.00

6,000.00

7,000.00

Share Capital Increase Or Decrease Percentage Of Increase Or Decrease

4.5.2 Reserve Fund :-


Table No. 4.5 :- Analysis of Reserve Fund

Sr. no

Year Reserve Fund Increase Or Decrease


1 2007 27,096.92

2 2008 19,813.40 (-) 7,283.52 36.76

3 2009 18,655.84 (-) 1,157.56 62.04

4 2010 19,952.19 1296.35 6.49

Total 85,518.35 9737.43 105.29


From the above table number 4.5, it is clear that, there is a decrease in Reserve Fund by Rs. 7,283.52 lakhs (36.76 Percent) in the year 2008.

There is a decrease in Reserve Fund of Rs. 1,157.56 lakhs (62.04 Percent) in the year 2009.

There is a increase in Reserve Fund of Rs.1296.35 lakhs (6.49 Percent) in the year 2010.

From the above findings the researcher came to know that, there is a Reserve Fund decrease, decrease and increase during the year respectively.

Graphs No. 4. 5

2007 2008 2009 20100.00

5,000.00

10,000.00

15,000.00

20,000.00

25,000.00

30,000.00

Reserve Fund Increase Or Decrease Percentage Of Increase Or Decrease

5.4 Other Liabilities :-


Table No. 4.6 :- Analysis of Other Liabilities

Sr. no

Year Other Liabilities

Increase Or Decrease


1 2007 1,926.26

2 2008 1,488.26 (-) 438 29.43

3 2009 1,684.80 196.54 11.66

4 2010 2,501.83 817.03 32.65

Total 7,601.15 1,451.57 73.74


From the above table number 4.1, it is clear that, there is a decrease in Other Liabilities by Rs. 438 lakhs (29.43 Percent) in the year 2008.

There is a increase in Other Liabilities of Rs. 196.54 lakhs (11.66 Percent) in the year 2009.

There is a increase in Other Liabilities of Rs.817.03 lakhs (32.65 Percent) in the year 2010.

From the above findings the researcher came to know that, there is a Other Liabilities decrease, increase and increase during the year respectively.

Graphs No. 4.6

20072008

20092010

0.00

500.00

1,000.00

1,500.00

2,000.00

2,500.00

3,000.00

Other LiabilitiesPercentage Of Increase Or Decrease

Other LiabilitiesIncrease Or Decrease Percentage Of Increase Or Decrease

4.6 Analysis Of Profit

4.6.1 Net Profit :-

The researcher collected the secondary data. i.e. Profit and Loss of Bank of Maharashtra Ltd from the year 2007-2010 for the said research study and analyzed it in following table 4.8

Table No. 4.7 :- Analysis of Net Profit

Year Net Profit Increase Or Decrease


1 2007 1,660.35

2 2008 775.91 (-) 884.44 113.98

3 2009 2,238.54 1462.63 65.33

4 2010 1,937.10 (-) 301.44 15.56

Total 6,611.90 2,648.51 194.87


From the above table number 4.8, it is clear that, there is a decrease in net profit by Rs. 884.44 lakhs (113.98 Percent) in the year 2008.

There is a increase in net profit of Rs. 1462.63 lakhs (65.33 Percent) in the year 2009.

There is a decrease in net profit of Rs.301.44 lakhs (15.56 Percent) in the year 2010.

From the above findings the researcher came to know that, there is a net profit decrease, increase and decrease during the year respectively.

Graphs No. 4.7

2007 2008 2009 20100.00

500.00

1,000.00

1,500.00

2,000.00

2,500.00

Net ProfitIncrease Or Decrease Percentage Of Increase Or Decrease

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