SERVICE SECTOR VISIT REPORT

ON

RAJKOT PEOPLES CO-OP. BANK LTD.

Prepared By :- BHIMANI DIVYESH P. (S.Y. B.B.A) Seat No. :- 05 Academic Year :- 2007-2008 Guidance:- KULDEEP JOBANPUTRA College :- R.P.BHALODIA COLLEGE, RAJKOT. Submitted To :- SURASHTRA UNIVERSITY

DECLARARTION

I, the undersigned Bhimani Divyesh P. a student of S.Y.B.B.A. from the SHREE R.P.BHALODIA COLLEGE of Commerce & Business management & Computer studies, declare that this project report is prepared by me. I had taken a help of my college and professor for the purpose of guidance only and to add that, myself prepare this report.

(Sign. Of Student)

Bhimani Divyesh P.

Place :: - RAJKOT Date :: -

/07

ACKNOWLEDGEMENT
It is my great pleasure at a time of presenting this report in front of all the concern authority. In preparing this report I have received very good help & guidance from several source. First, of all I am very thankful to the saurashtra university for introducing this type of learning system as one can be aware of practical life. Especially, I would like to extend my feeling of gratitude to Mr. R.B.Pandya who have provide me all the required information for my project report & guide me personally on banking operations. I am also very much thankful to my college authority. I am also thankful to my project guide mr. Kuldeep. for give me very well guidance.

(Sign. Of Student)

Bhimani Divyesh P. Place: - RAJKOT Place: Date: -

/07

PREAFACE
Today, Human life is become more practical. Practical learning is as important as theoretical knowledge. And in education field involvement of practical knowledge is just like a big change. In the B.B.A. stream practical knowledge of the market & environment is more important than other books of management, is like a new way of learning. And for this type of learning & to prepare my project report for the S.Y.B.B.A I have selected THE CO-OPERATIVE BANK OF RAJKOT LTD. Popularly known as peoples bank, a very prestigious & developing firm of the banking sector in our economy & also it is the life line of the economy. In regard to this I have visited Rajkot Peoples Co-Operative Bank Ltd. I have prepared the report of this bank on the basic of information, which I collected from various department of the bank I got all the information, which I wanted from this bank, I noted the matter, which I observed during my visit to Rajkot Peoples Co-Operative Bank Ltd. I gathered necessary information regarding various department Marketing department, Finance department and Personnel department.

INDEX

Sr. No. 1. 2. 3. 4. 5. 6. 7. 8. 9

CONTENTS
General Information Human Resource Department Marketing Department Loan & Service Department Account & Finance Department S.W.O.T. Analysis Future Plan Conclusion & Suggestion Bibliography

Page No. 6 14 28 33 47 61 65 67 70

GENERAL INFORMATION

CONTENT

SR.NO.

PARTICULARS
Baking Sector In India General Information Of Bank Objectives of bank Policies of bank Board of directors

PAGE NO.

1. 2. 3. 4. 5.

9 10 12 13 14

BANKING SECTOR IN INDIA

The Co operative banks in India started functioning almost 100 years ago. The Cooperative bank is an important constituent of the Indian Financial System, judging by the role assigned to co operative, the expectations the co operative is supposed to fulfill, their number, and the number of offices the cooperative bank operate. Though the co operative movement originated in the West, but the importance of such banks have assumed in India is rarely paralleled anywhere else in the world. The cooperative banks in India play an important role even today in rural financing. The businesses of cooperative bank in the urban areas also have increased phenomenally in recent years due to the sharp increase in the number of primary co-operative banks. Co operative Banks in India are registered under the Co-operative Societies Act. The cooperative bank is also regulated by the RBI. They are governed by the Banking Regulations Act 1949 and Banking Laws (Co-operative Societies) Act, 1965.

GENERAL INFORMATION OF BANK

The name of this bank is Rajkot Peoples Co-Operative Bank Ltd. The audit class of the bank is A The year of establishment of the Bank is 1998. The register number of this bank is 29673-1997 The banking RBI license No. of this bank is UBD/GUJ/1497P The Chairman\M.D. of this bank is Shree Shamjibhai Khoont. Chartered Accountan of this bank is P.T. Mankadia(C.A.) Concurred auditor of this bank is Sanjay H. khakkhar Accounting year of this bank is 1st April to 31st March

The head office of this bank is RAJKOT. The registered office of this bank is in RAJKOT. Rajkot Peoples Co-Operative Bank Ltd. Sabhasad Bhavan, 1-Manhar Plot,Gondal Raod, Rajkot 360 002. Ph. :( 0281) 2480942-43-44 Fax : 0281-2480945

There are 5 branches in the Rajkot of this bank. Accounting year of this bank is 1st April to 31st March Working hour of this bank is 10:00 A.M. to 5:30 P.M Off Day - Sunday & approved by negotiable act The E- mail I.D. of the bank is info@rbcbank@sify.com.

10

OBJECTIVES OF BANK

Accumulate deposit to the tune of Rs. 100 crores. Disburse advances to the tune of Rs. 65 crores. Achieve net profits to the tune of Rs. 100 laces. Acquires business per employee for Rs. 200 laces for the year. Reduce cost of deposit to 7% Bring customers satisfaction to 100% Reduce customers complains to 100% Educate customers to bring banking awareness. Train staff to become more effective. Update present software.

11

POLICIES OF BANK
Bank is committed to achieving the customers satisfaction through

1) 2) 3)

Providing best services as per norms. Enhancing organizations image and reputation for quality. Continuously improving service quality. This commitment is met through nurturing quality culture in the

organization and the by constant adherence to laid down quality management system.

BANKS AREA OF OPERATION

Rajkot Peoples Co-Operative Bank Ltd. operates through 5 branches including main branch. This bank has expanded its area of operations to Jamnagar and Junagadh district, over and above Rajkot region. This bank has geared up all its procedures to open its branches in these districts.

12

BOARD OF DIRECTORS

CHAIRMAN\M.D. :: Shree Shamjibhai Khoont

VICE CHAIRMAN

:: -

Shree Bhikhalal Kamani

DIRECTOR

:: -

Shree Meghjibhai Virani

DIRECTOR

:: -

Shree Parsottambhai Patel

DIRECTOR

:: -

Shree Gordhanbhai Shingala

DIRECTOR

:: -

Shree Sureshbhai Kamani

DIRECTOR

:: -

Shree Premchandbhai Agarwal

DIRECTOR

:: -

Shree Vallabhbhai Vadalia

DIRECTOR

:: -

Smt. Bhagvatiben Khoont

DIRECTOR

:: -

Smt. Meenaben Vaghela

DIRECTOR

:: -

Shree Harikrishnabhai Ghadia

DIRECTOR

:: -

Shree Prafulbhai Patel

DIRECTOR

:: -

Shree Veljibhai Pipalia

13

GENERAL MANAGER

:: -

Shree Jagdihbhai Busa

14

HUMAN RESOURCE DEPARTMENT

15

CONTENT

SR.NO.

PARTICULARS
Introduction General Meeting Qualification Of Directors Time Keeping System Selection & Recruitment Promotion & Transfer Personal Record Remuneration Training & Seminars Organization Chart

PAGE NO.

1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

16 17 18 19 20 23 24 25 26 27

INTRODUCTION

16

The internal department structure of personnel department varies widely from one company to another; the personnel department has to function as a medium to establish healthy relationship between the management and the employee. Organization is formed by the factor of production namely land, labours, money etc. Middle level management and labourers is the living factor with the sense of feeling. Personnel management is the planning, organizing, direction, controlling of the procurement, development, compensation, integration and malignance of people of the purpose of contribution to organization, individual and social goal.

- EDWARD FLIPPO
Personnel management is the direction and co-ordinate of Human Relations in the business organization, thereby obtaining maximum production with minimum of physical and mantel effort, stress and strain on the individual worker and group of workers and without sacrificing the genius well being of the employees. Now a day, proper direction to achieve the goal is carried out by a separate department that is personnel, Personnel management is the planning, organizing, directing and controlling of procurement development, compensation, integration and maintenance of people for the purpose to contribution, to organization, individual and social goals. Personnel department is concerned with training and development of employees and providing them proper wage and salary.

17

GENERAL MEETING
After the financial year within three months annual general meeting has been decided. All the member of bank staff, board of directors is invited to attend the meeting. Generally the entire general meeting can be of annual general meeting and special general meeting two types in all kinds of organization.

1.

The agenda of the meeting was to note the audited accounts of bank, and audit report on 31st March,

2.

The loonies who could not paid their loan; they can get the advantages of one time settlement scheme to their sanction application. The time period is not fixed given to loonies but it is decided in the general meeting.

3.

Small loan holders who are enable to repay their loan amount as a relief to close their account from bad and doubtful debts reserve to discuss the suggestion by members & chairman of the bank.

18

QUALIFICATION OF DIRECTORS
As we know that the directors are the most important part for any kind of organization, for be the director of any organization, the person should have some certain qualification. 1) The member who have at least the balance of Rs.2000 in the bank at the 31 st march, so he can be the director of the bank according to the law of bank. 2) The person who have a membership of bank of 24 months before the date of election. 3) 4) The age of the person should be above18 years. He should not be the creditor of any kind of organization.

AUTHORITY OF MANAGING DIRECTOR

1) 2) 3) To appoint the managers and secretary. To decide the salaries and bonus of particular employee. To do punishment if any mistake done by the employees and to see the proper way of work to them. 4) To here complains and understand the problems and make the way clear of work by avoiding these kinds of restrictions.

19

TIME KEEPING SYSTEM

Time & tide waits for none is the famous saying, keeping this view in mind a unit has to develop an efficient time keeping system. There are various benefits that a firm is able to avail only because of discipline in time management system. To get these benefits that affect the system of time keeping like production capacity, demand for products etc. After studding all these factors time schedule are adjusted. Time keeping system is important for the businessman and employers. This system can also be used to improve employee relation. Peoples banks working hour is 10 a.m. to 5.30 p.m. The employees of this company enjoy one holiday in a week that is Sunday and holiday which is approved by negotiable act.

20

SELECTION & RECRUITMENT

SELECTION :: Selection means the procedure of selection in terms of best person and all with required qualification. This process is negative by nature because it selects only suitable persons and rejects the other applied. According to Yoder, the hiring process is of one or many go, no-go gauges. Candidates are screened by the application of these tools. Qualified applications go on to the net hurdle, while the unqualified are eliminated. Rajkot Peoples Co-Operative Bank Ltd. gives advertisement in the magazines and receives applications. From that application interview is taken, and then the person is selected in interview. Finally salary is decided as per the qualification and ability for job.

SELECTION PROCESS :: Selection is a process by which the qualified personnel can be chosen from

the application selection is process in the hand of management to get qualify and disqualify applicant by various methods. This process is as follow :: -

Interviews Primary selection Final selection Placement

21

RECRUITMENT :: Recruitment is the process of identifying various sources of recruitment

persons in the organization. It is the process of searching and encouraging them to apply for jobs in organization. Recruitment has been regarded as the important function of this department.

Recruitment has been regarded as the most important function of personnel administration, because unless right the type of people are hired, even the best plans, organization charts and control system would not do much good. According to Flippo, it is a process of searching for prospective employees and stimulating and encouraging them to apply for jobs in an organization. It is often termed positive in that it stimulates people to apply for jobs to increase the hiring ratio i.e., the number of applicants for a job. Selection, on the other hand tends to be negative because it rejects a good member of those who apply, leaving only the best to be hired. Rajkot Peoples Co-Operative Bank Ltd. uses both internal and external sources of recruitment. When any employee having qualification, ability and experience works in the unit at lower level and if the place is vacant, the place is filled by promotion.

22

RECRUITMENT POLICY
According to Yoder, the recruitment policy is concerned with quantity and qualifications of manpower. A good recruitment policy must contain these elements: a) Organizations objectives both in the short term and long term must be taken into consideration as a basil parameter for recruitment decisions and needs of he personnel area wise, job family - wise. b) Identification of the recruitment needs to take decisions regarding the balance of the qualitative dimensions of the would be recruits i.e., the recruiters should prepare profiles for each category of workers and accordingly work out the man specifications, decide the sections, departments or branches where they should be placed and identify the particular responsibilities which may be immediately assigned them. c) Preferred sources of recruitment, which would be tapped by the organization e.g., for skilled or semi-skilled manual workers, internal sources and employment exchanges may be preferred; for highly specialized categories and managerial personnel, other sources besides the former, may be utilized. d) Criteria of selection and preferences: these should be based on conscious thought and serious deliberations. In some cases trade unions may be consulted in working out the recruitment policy. In others, management may take the unilateral decision. e) The cost of recruitment and financial implications of the same.

23

PROMOTION & TRANSFER

PROMOTION :: Promotion may be defined as, upward of an employee in an organization, which commands better wages, better status, higher responsibility & authority etc. In short a promotion is the transfer of an employee to a job, which pays more money or one that carries out some preferred status. Promotion may be given on the basis of seniority, merits on the basis of seniority, but here promotion is given on the basis of ability, performance, capability, merits and qualification. Rajkot Peoples Co-Operative Bank Ltd. does not promote its employees on the basis of seniority, but promotion is given on the basis of ability, performance, capability, merits and qualification.

TRANSFER :: Transfer is a horizontal moment of employees from one selected job, department to another place where the salary, status and responsibility are remaining same. In Rajkot Peoples Co-Operative Bank Ltd. employees are transferred from one department to another and from one position to another.

24

PERSONAL RECORD

In personal record, compete up to date information is maintained about employees. Every unit have record book for employees in which record information about employ, leave, promotion, punished men etc. Rajkot Peoples Co-Operative Bank Ltd. has record books of employees. These record books are as follow.

Attendance register Salary-wages register Provident fund register Casual leave register Bonus register Others

SOCIAL RESPONSIBILITIES
Rajkot Peoples Co-Operative Bank Ltd. has remained ahead in fulfilling social responsibilities. Rajkot Peoples Co-Operative Bank Ltd. has always remained active for maintaining good health of the people of the society, by sponsoring Sharir Santulan Shibirs and Yog Shibirs. Taking into consideration

25

various benefits availed by participants of such programs, we are successfully organizing such programs every year.

REMUNERATION
Remunerations main purpose is to maintain equitable remuneration structure. It is the duty of the firm to pay proper, relative and reasonable amount to the worker for their service. Rajkot Peoples Co-Operative Bank Ltd. is under consideration follow the time wages (remuneration). This is oldest & most common method of wages (remuneration). Under this system workers are paid according to the work done during certain period. Like hour, par day, weekly, monthly or any fixed period of time. Rajkot Peoples Co-Operative Bank Ltd. pays salary (remuneration) their worker on monthly basis.

26

TRAINING & SEMINARS

Training is the organized procedures by which people acquire knowledge for a benefit. It is the act of increasing the knowledge and skill of workers for doing a certain job. As the trained labours are considered the valuable assets to the organization training is considered as a vital part of managerial control. By arranging training programs and seminars Rajkot Peoples CoOperative Bank Ltd. is trying its best to improve the banking skill of the staff, thereby bring momentum in the banks work. And for this, continuous training is being given to the staff within the premises as well as deputing them to other institution on regular basis. The Chairman, Vice-Chairman and Members of the Board of Directors are also taking part various seminars and thereby get acquainted with various pros and cons of co-operative banking arena. Thus, good training is provided to the employees who become more effective and productive after this process.

27

ORGANIZATION CHART
CHAIRMAN

VICE CHAIRMAN

MANAGING DIRECTOR

GENERAL MANAGER

MAIN BRANCH

OTHER BRANCHES

MANAGER

MANAGER

DEPUTY MANAGER

ASSISTANT MANAGER

ASSISTANT MANAGER

CLARK

CLARK

PEON

PEON

28

MARKETING DEPARTMEN T

29

SR.NO.

PARTICULARS
Introduction Promotional Activity Marketing research

PAGE NO.

1. 2. 3.

30 31 32

CONTENT

30

INTRODUCTION
Today, marketing is spread in every field of like hospitals, services, goods even politics and many more. In banking sector too the importance of marketing also can not measurable, still it has not developed in public sector it is only limited to foreign banks and private sector. The reason for success of foreign in India is only best marketing efforts. Today in banking sector there is a cutthroat competition among public sector, private sector and foreign bank. Marketing is a human activity directs at satisfying the needs and wants of customers, there are five stages of bank marketing firstly marketing g is advertising, sales promotion and publicity, secondly marketing is smiling and Co-friendly atmosphere, thirdly marketing is innovation like the ATMs or cheques with drawls on fixed deposits, fourthly marketing is positioning. When all banks advertise and innovate, they look alike so, they should try to position themselves differently, even through symbols, logos or aggressive advertising so that the customer can distinguee between one bank and another and finally marketing is analyzing, planning and control. At Rajkot peoples co-operative bank though there is no specific marketing department. for marketing of different services but providing vest services to their customers and getting good customer satisfaction, and doing such efforts of marketing like promotion activities they are in directly getting benefits of the marketing. Today they are also planning for such continuous marketing efforts. 31

PROMOTIONAL ACTIVITIES

Promotion tools are also essential in the banks marketing mix. We need personal selling in customer contact, development, personal service. And so on. Similarly, bank marketing program need advertising as mass communication tool. The bank is a sponsor. It sends a message to prospective buyers (the audience) by means of a medium (The carrier of the message). An advertisement in bank marketing is a promise3 a promise of satisfaction to prospects who buy or use the service offered by the bank or who are willing to patronize the bank. Banks are using all media of advertisement such as newspaper, radio television, magazines etc., for advertising their services and for getting the business. Bank marketing also uses sales promotion devices such as point of purchase materials, advertising specialties (ball pens, calendars, diaries, notes pads etc.) brochures and booklets describing bank services, etc. a bank has also to use public relation as mode of promotion to build up and maintain its bright image in the community.

32

MARKETING RESEARCH
Good marketing decisions are not made in a vacuum. Hence, even in bank marketing. We need marketing research and information to enable bank executive to make sound decisions. The increase in the use of marketing research in bank marketing is due to two forces: competition pressures to be right, and Customer orientation in marketing planning and program. Banks are now establishing a separate marketing organization. Conduction marketing research, setting up sales training program and adopting sales promotion divides promotion devices to attach customer we have special bank advertisement through radio. T.V. and newspapers. Marketing research may be defines as The scientific and controlled process of gathering of none routing, marketing information, helping management to solve marketing problems. As far as it concerned with the marketing research process at Rajkot peoples co-operative bank. They have been continuously doing such research from beginning. But one positive point for marketing research is that they not doing any big expenses for marketing research and for executives. Banks staff member themselves goes to market and gathers requited information or data. Such information or data they are collection from direct RBI or other banks. So, by this way they are getting benefits by using marketing research process. 33

LOAN & SERVICE

34

CONTENT

SR.NO.

PARTICULARS
Introduction Deposits Loans Other Services Process Of Granting Loan Recovery Of Loan

PAGE NO.

1. 2. 3. 4. 5. 6.

35 37 39 44 45 46

35

INTRODUCTION
With years, banks are also adding services to their customers. The Indian banking industry is passing through a phase of customers market. The customers have more choices in choosing their banks. A competition has been established within the banks operating in India.

With stiff competition and advancement of technology, the services provided by banks have become more easy and convenient. The past days are witness to an hour wait before withdrawing cash from accounts or cheques from north of the country being cleared in one month in the south.

This section of banking deals with the latest discovery in the banking instruments along with the polished version of their old systems. Banks in India with the way of development have become easy to apply in loan market. Generally, Loan against Shares, Personal Loan, Home Loan, etc, Loans is given by almost all the banks in the country:

36

SERVICES AT A BANK
DEPOSITS ::
Current deposits (account) Fixed deposits (account) Saving deposits (account)

LOANS :: a ) Term Loans ::

Housing loan Business loan Vehicle loan Personal loan Professional loan Loan against NSC\KVP\LIC

b)

Cash Credit :: Loan to Small Scale Industry Others

OTHER SERVICES :: In other services, bank provides following services,

Locker system Demand draft

37

DEPOSITS
1)
CURRENT DEPOSIT (ACCOUNT) :: While opening this account person or who so ever is going to open this type of account, he has to make the regular transactions with this account. Generally, this type of account can be opened by businessmen, companies, industrialist, and common men etc, who have working capital in his hand and interested to keep his money safe. Mostly the businessmen open this type of account because they have to receive and make payments through cheques many times in a day.

A.

Required Documents To Open Current Account :: For partnership firm B. For

proprietorship firm
photos. All partners photos.

All

partners

firm.

Copy of partnership deed.

P.A.N card Copy of Proof of existing of Copy of S.T Proof

of all

firm.

P.A.N card Copy of firm.

& C.S.T no. (If).

Registration copy (If).

partners address.

Proof of existing of firm.

Proof of all partners address.

38

A person has to deposit minimum Rs. 3000 in current account. Bank takes Rs. 300 service charge at the end of the year. If a person wants to close his current account, bank charge Rs.50 (if a person having cheques book) and bank will charge Rs. 25(if person is not having cheques book).

2)

SAVING DEPOSIT (ACCOUNT) :: It is an ideal account for those who have sufficient money to save.

Generally, common men who save money from his salary and he deposits in to bank for saving purpose. Saving account is the best way and when ever need of money occur he can get or withdraw money from his saving account. If a person wants to open his saving account with a bank, he has to fill up a firm of the banks saving account, he has to give required documents such as photo, address proof, license or election card as identity etc, and he has to deposit minimum Rs. 1,000. If a person wants a new cheques book, bank charges Rs, 50 for every cheques book. While closing a saving account, a person has to surrender all documents which have already been given by a bank like, cheques book, pass book, etc. Rate on saving account is 3.5%.

3)

FIXED DEPOSIT (ACCOUNT) :: A person who has spares money for a particular period of time and he wants

to get it as double so for him fixed account is a best way to deposit money. In this account he has to deposit his money for a specific period of time and as a reward he can get double amount after completion of time. If a person wants to open his fixed account with a bank, he has to fill up a firm of the banks fixed account, he has to give required documents such as photo, address proof, license or election card as

39

identity etc, and he has to deposit minimum Rs. 1,000. While closing a saving account, a person has to surrender all documents which have already been given by a bank. A person can get double at 109 months.

LOANS
A) TERM LOANS :: It is one of the major sources of debt finance for a long term project. Term loans are generally repayable in more than a year but less than 10 years. These loans are offered by all Indian financial institutions. Term loans are generally secured through a first mortgage or by way of deposit of title deeds of immovable properties.

1)

Housing Loan :: Home loan is the latest craze in the banking sector with the development of

the infrastructure. Now people are moving to township outside the city. More number of townships is coming up to meet the demand of 'house for all'. The RBI has also liberalized the interest rates of home loan inorder to match the repayment capability of even middle class people. Almost all banks are dealing in home loan. Again SBI, ICICI, HDFC, HSBC are leading. Local residential can get housing loan for the purpose of to purchase or build home. Rate of interest is 10.5% for Rs. 5 lacs and above Rs. 5 lacs; rate of interest is 11.5%. As a security bank takes the documents of property which is mortgage by the person. A person, who is grated loan, has to repay loan to bank up to 5 years.

40

2)

Business Loan :: A person who is engaged in their business at least from last one year can get

this kind of loan for the purpose of fulfillment of the short term working capital needs. A business man get loan up to 10 lacs but in special cases bank allow him to grant above 10 lacs and person has to repay the loan in installments which should have already been decided. As a security bank takes all documents of property which is being mortgaged by a person. Rate of interest on this loan is as under :: Up to Rs. 2 lacs Rs. 2 lacs to Rs. 5 lacs Rs. 5 lacs to Rs. 10 lacs Above Rs. 10 lacs :: :: :: :: 12% 12.5% 13% 14%

3)

Vehicle Loan :: A person or a businessman who wants to purchase new or old vehicle for the

purpose of the transportation or for personal use can get this kind of loan. Bank grants this kind of loan up to 85% of the face (quotation) value of vehicle and person has to repay the loan in installments which should have already been decided. Rate of interest on this loan is as under :: For transport operator For personal use :: :: 14% 13%

41

4)

Professional Loan :: This kind of a loan is granted to professional persons such as lawyers, C.A,

doctors, etc, for the professional purpose like, to the doctor bank grants this type of loan to build new clinic, to buy new medical equipments, and so on. Bank grants this loan up to 10 lacs but in some cases bank grants loan above 10 lacs and person has to repay the loan in installments which should have already been decided. Rate of interest on this loan is as under :: Up to Rs. 2 lacs Rs. 2 lacs to Rs. 5 lacs Rs. 5 lacs to Rs. 10 lacs Above Rs. 10 lacs :: :: :: :: 12% 12.5% 13% 13.5%

Up to Rs. 25,000 Above Rs. 25,000

:: :: -

13 % 14 %

42

B)

CASH CREDIT :: -

1)

Loan to Small Scale Industry :: -

A person who has his own business and wants to start his own business as small scale sector can get this kind of the loan for the purpose of fulfillment of the short term working capital needs or to purchase new machineries or so on. A business man can get loan up to 15 lacs but in special cases bank allows him to grant above 15 lacs and person has to repay the loan in installments which should have already been decided. In cash credit type loan, person can withdraw money (up to decided) if there is no money in his account. Bank grants this loan against the raw material, stock, and any mortgaged properties. The insurance of stock and mortgaged properties is taken by the bank as a security. Rate of interest on this loan is as under :: Up to Rs. 2 lacs Rs. 2 lacs to Rs. 5 lacs Rs. 5 lacs to Rs. 15 lacs Above Rs. 15 lacs :: :: :: :: 11% 11.75% 12.25% 13%

43

2)

Other Cash Credit Loan :: -

Bank also grants cash credit to the local residential or to an ordinary people to fulfill their needs for money. A person can get loan up to 10 lacs but in special cases bank allows him to grant above 10 lacs and person has to repay the loan in installments which should have already been decided. In cash credit type loan, person can withdraw money (up to decided) if there is no money in his account. As a security bank takes all documents of property which is being mortgaged by a person. Rate of interest on this loan is as under :: Up to Rs. 2 lacs Rs. 2 lacs to Rs. 5 lacs Rs. 5 lacs to Rs. 10 lacs Above Rs. 10 lacs :: :: :: :: 11.5% 12.25% 12.75% 13.5%

44

OTHER SERVICES
1) Locker System :: Bank also provides locker system to their customer or peoples. Basically, bank provides A, B, C - three types of lockers and size of lockers are 6*6, 6*12, and 12*1 respectively. Bank also charge for locker Rs. 350, Rs.450, Rs. 550 respectively. A person who is going to open locker with bank, he has to deposit Rs. 5, 500, Rs. 6,500, Rs. 7,500 for A, B, C respectively. Person also has to open his current account with bank because bank will debit service charge of locker in his current account.

2)

Demand Draft :: Purchase of demand draft is required to fill up the requisite application

form of bank which contains following columns :: Date of the application. Scroll no. Name of the drawer bank and its branch Account type no. and cheques no. Beneficiarys name. Demand draft no. and bank code no. Amount of demand draft in figures and commission and total Rs. Purchasers name, address, and sign. Cashier\Clerk and officers initials.

45

PROCESS OF GRANTING LOANS

Primary Investigation :: In primary investigation, bank investigates all the things of the customer such as, name, address, purpose of loan, amount of loan, assets which is going to be mortgaged, etc. After knowing all the things about the customer, bank will give loan form to customer. He has to fill up all the things clearly. Bank will need some documents for assurance. The one and common document bank demand is demand promisenary this because customer needs loan. If bank is granting loan to partnership firm and proprietorship firm following documents are required.

All Partners / Proprietors photos. Copy of Partnership / Proprietors deed. P.A.N card Copy of firm. Registration copy (If). Proof of existing of firm. Proof of all Partners / Proprietors address.

If bank is granting loan in the form of vehicle loan, bank will try to know the purpose of getting loan whether it is getting to buy new or old vehicle and bank also grant loan against the vehicles. If bank is going to grant loan to the company, bank will demand for registration documents of the company. After investigating all above things and required documents General Manager of the bank will decide to grant loan or not. For taking this decision he may call meeting and General Manager takes an opinion of the others. Thus they will decide to grant loan.

46

RECOVERY OF LOAN
Customer who is being granted loan by bank, he has to repay the loan in small installments which have already been decided earlier. Customer has to pay his installment in 1st to 10th of month otherwise he has to pay fine (penalty) interest 2% more for per day. If customer does not pay more than 3 installments, bank will issue legal notice. And though customer will not pay installment bank will claim in court and generally court will also take decision in favor of the bank then after Bank will again issue notice of confiscation assets for 30 days. After these entire if customer will not pay installment bank will issue notice of auction of his assets and bank will give an advertisement in news paper and after 30 days bank will get its money from selling assets.

47

ACCOUNT & FINANCE

48

CONTENT

SR.NO.

PARTICULARS
Introduction Financial Analysis Ratio Analysis Financial Report Information Of Shares Auditors Report

PAGE NO.

1. 2. 3. 4. 5. 6.

49 50 51 53 57 58

49

INTRODUCTION
Today, Finance is considered as the Life Blood of the Business without finance no business activity is possible. So for an organization, it must have a large amount of finance and for this it should have finance department.

Finance management is concerned with the acquisition, financing and management of assets with some overall goal in mind. Finance management continuous to develop at an even more rapid pace. Advancement is occurring not only in the theory of finance management but also in its real world practice.

The finance manager has dynamic role in a modern companys development. Until around the first half of century, finance manager primarily raised funds and managed their firms cash and that was pretty much it. Today internal factors have an increasing impact on the financial manages. Corporate competition, technological changes volatility in inflation and interest rates, worldwide economic uncertainty, fluctuating exchange rats, tax low changes, and ethical concourse over certain financial dealings must be dealt with the corporation.

Finance management is very important i.e. first to manage financial resource, then to distribute that finance among the various department according to their need and lastly has to check whether it is used in right way or not. Thus, only finance gathering has not become the goal or aim of finance management but is holds a key position in top management of companies.

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FINANCIAL ANALSIS
The nature of analysis will differ depending on purpose of the analyst. Trade creditors are interested in firms ability to meet their claims over a very short period of time. Their analysis will therefore confine to the evaluation of the firms liquidity position. Suppliers of the long term debit on the other hand are concerned with the firms long term solvency and survival. They analyze the firms profitability over time, over its ability to generate cash to be able to may interest and repay principal and relationship between various sources of funds. Investors who have invested their money in the firms shares are concerned about the firms earnings. They restore more confidence in there firms that show steady growth in evening. Management of the firm would be interested on every aspects of the financial analysis. It is their overall responsibility to see that the resources of the firm are used most effectively and efficiently and that the firms financial condition is found.

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RATIO ANALSIS
Ratio analysis is a powerful tool of financial analysis. A ratio is defined as the indicated quotient of two mathematical impression and as the relationship between two or more things. It helps to ascertain the financial condition of the firm. Ratio analysis is a process of identifying the financial strength and weakness of the firm. A financial ratio is a relationship between two variables which are drawn from the financial statements of business enterprises it is important for there variables which are related to each other. It is one the financial control tools in the head of management and is widely used by business. Ratios as shown above are relative figures reflecting the relationship between variables. They enable analyst to draw conduction regarding financial operations. The use of ratios as a tool of financial analysis involves their comparison for a single ratio like absolute figures, fails to reveal the true position. For example, if in the case of a firm the return on capital employed is 15% in a particular year, what does it indicate? Only if the figure is related to the fact that in the preceding year the relevant return was 12% or 18% can it be informed whether the profitability of the firm has dedicated or improved. Alternatively if we know that the return for the industry as a whole is 10% or 20%, the profitability of the firm in question can be evaluated. Comparison with related facts is therefore the basis of ratio analysis. Four types of comparisons are involved ( 1 ) trend ratio ( 2 ) inter firm comparison ( 3 ) comparison of items within a single years financial statement of a firm ( 4 ) comparison with standards as plans.

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IMPORTANCE OF RATIO ANALYSIS

Importance of ratio analysis are as follows :: 1) 2) 3) It helps in knowing the liquidity position of a firm. Ratio analysis helps in assessing long term financial viability of a firm. It helps management in evaluating operating efficiency of management & utilization of its assets. 4) 5) It also helps investors on outsiders in evaluating even all profitability. Ratio analysis helps in inter firm comparison that helps in comparing firms performance. 6) Finally, ratio analysis enables to tale the time dimension into account. In other words whether the financial position of a firm is improving or determining over the years.

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FINANCIAL REPOERT
The directors have pleasure in presenting the 8th report of Rajkot Peoples Co-Operative Banks Audited Statement of Accounts of the year ended on 31st March 2006. Due to irresponsible attitude of some of the Co-Operative Banks management in the last few years, lay men had to suffer immense loss. However, under the adverse circumstances, Rajkot Peoples Co-Operative Bank has kept the pace with the progress all around and has sustained faith of the people, which is highlighted from the following information.

DIVIDEND :: As per the provision of the Gujarat Co-Operative Societies Act of maximum

limit of Dividend, Board or Directors recommends 15% Dividend. Rajkot Peoples Co-Operative Bank has shown consistency in maintaining the same rate of Dividend since inception.

CAPITAL ADEQUACY :: Against the statutory Requirement to maintain capital adequacy ratio that is

capital to risk weighted assets ratio-CRAR at 9% Rajkot Peoples Co-Operative Bank has maintained as high as 11.57%. Higher CRAR suggests high financial soundness of the bank. The CRAR is an indictor to measure the risk against the capital.

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FINANCE :: The liberalization of the financial sector is the key for the over all

liberalization process. Gradually, the structure of the financial market itself has begun to change, in the changing Financial Market; Rajkot Peoples Co-Operative Bank has market the progressive growth and profitability both the financial year 2005-2006 which is reflected in the following Financing since inception:

(Rs. In Lacs) Particulars Members Share Capital Deposit Advances Net Profit Working Capital 31-3-05 13,300 Rs. 216 Rs. 8,800 Rs. 6300 Rs. 92 Rs. 10,200 31-03-06 13,550 Rs. 230 Rs. 9640 Rs. 6300 Rs. 97 Rs. 10,850

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DEPOSITS :: The condition of many banks became vulnerable during last few years.

However Rajkot Peoples Co-Operative Bank was successful in sustaining the trust of its Depositors and has sustained the same growth in all adverse circumstances. Rajkot Peoples Co-Operative banks deposits, in comparison to previous year have increased by 9.51% and reached to Rs.96, 50,00,000 as at 31.03.2006. The ruse in the deposits is the symbol of trust. The percentage of low cost deposits to total deposit is rising year by year which is the key for gradual but steady growth in profitability.

ADVANCES :: Rajkot Peoples Co-Operative bank grants various loans and advances for

the actual needs of the fundamental principles of co-operation. As a matter of fact, Rajkot Peoples Co-Operative Bank is Big for Small (lay) people and small for big (rich) people. Rajkot Peoples Co-Operative Bank has always tried to be helpful to common people, which are 6,300 (in lacs). Rajkot Peoples Co-Operative Banks financial portfolio is distributed in entire economic and varied activities so that changes arising from the market may not have direct adverse impact on the recovery and economy affairs of the bank.

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INVESTMENT :: Out of total investment of Rs. 19, 70, 00,000 of Rajkot Peoples Co-

Operative Bank at 31.03.2006, Rs 18, 99, 00,000 has been invested in various central government securities. The face value of the investment is Rs. 19, 00, 00, 000 and market value of the investment is Rs. 19,11, 00,000. Rajkot Peoples Co-Operative Bank has adopted the policy of investment as directed by the reserve bank of India from time to time. Accordingly, entire investment is kept in RBIs SGL Account. Rajkot Peoples Co-Operative Banks total investment is more than statutory requirement.

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INFORMATION OF SHARE

SHARE CAPITAL :: Last year there were 13,280 members. This year it has reached to 13,550 in

numbers. During the year 2005-2006, total share capital gone up to Rs. 2, 30,00,000 which is 6.02% higher than the previous years figure. An increase in number of members is the sign of success of the bank.

SHAREHOLDING :: -

If a person who wants to become share member of the bank, has to buy the shares of that bank. He has to fill up form of the bank. Bank collects the share application form, membership fees and share application money. Board sanctioned the share application and provides membership member and also provide an identity card. Now, the person becomes a permanent member of this bank.

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TRANSFER OF SHARE :: -

If any share holder wants to transfer his share in favor of any person, he has to fill up share transfer form of the bank in favor of others. He has to pay transfer fees and submit original share certificate to bank and identity card which has already been given to the share holder and bank will transfer his share on name of another person.

SHARE CERTIFICATE :: -

Bank issues the share certificate to share holder and identity card. The share certificate is approved by the Co-Operative sector. In which such things are covered as Bank shareholder No., Sr. No., Certificate No. signed by the of bank authority. If a person who deposits Rs25, 000 in the account of the bank, bank will give him a share certificate.

RESERVES AND FUNDS :: Various reserves and funds of Rajkot Peoples Co-Operative bank has

reached to the level of Rs. 7,50,00,000 as at 31.03.2006, which is 40.33% higher than the previous years figure. Constant rise in various reserves and funds is also a land mark of a successful and sound bank.

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AUDITORS REPORT
We have audited the balance sheet as on 31.3.2006 and the profit & loss account for the year ended on 31.3.2006 of Rajkot Peoples Co-Operative Bank Ltd. With reference to our audit memo and audit note we hereby report as follow: 1) statements. 2) We follow the rules and regulation of the existing accounting standards for the said audit purpose. It is to be verified that the said financial statement are true and the information and figurative data disclosed are genuine in all respect. 3) As per our opinion all the information and explanations provided to us are disclosed in banks books and as per that we report as follows: a) The balance sheet as on 31.3.2006 and the accounting note there in reflect the actual financial position of the bank all the required information is included in it and it is properly prepared. b) The profit and loss account for the year ended on 31.3.2006 reflects the actual profit of the bank. It is bank management duty to prepare the said financial statement our duty is only to give opinion about the genuineness of the informative data disclosed in the said

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4)

The information and clarifications required by us promptly provided to us and we found them satisfactory.

5)

The transaction of the bank observed by us are lawful and as per rules and regulation of the respective law.

6)

As per our opinion all mandatory financial records to be maintained are properly maintained by the bank.

7)

The NPA classification and the provisions thereof of the bank are as per the norms of income recognition and provisions prescribed by Reserve Bank of India.

Rajkot Peoples Co-Operative Bank Ltd. satisfies all the needs of auditors. The audit class of this bank is A and the audit grade of this bank is 1.

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S.W.O.T ANALYSIS

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STENGTHS

WEAKNESSES

S.W.O.T. ANALYSIS

OPPORTUNITES

THREATS

Strengths Weaknesses Opportunities Threats

W = O T = =

STRENGTH :: 63

This bank is very reputed in local (Rajkot) area. Professional management & co-operate team spirit. Strong brand equity in local (Rajkot) area. Fully computerized. Profitability & sound liquidity. Branches in all most developed part of Rajkot. No mistake in regular transactions can be found because of small network. Against the statutory Requirement to maintain capital adequacy ratio that is capital to risk weighted assets ratio-CRAR at 9% Rajkot Peoples CoOperative Bank has maintained as high as 11.57%.

WEAKNESSES :: Bank is not performing marketing activity because lack of marketing expertise. Lack of modern management concepts and sometimes

communication gap can be found which indicates lack of professionalism. Bank is not providing A.T.M. facility in the recent developed era and Bank is not fully developed in modern era. Lower volume of advances due to higher rate of interest may affect the expansion of the organization. Not reputed at national level and less no. of the branches.

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OPPORTUNITIES :: Bank can open branches at state level in near future. Number of branches can be increased in all over nation next 5 to 8 years.

Bank can introduce new services like, NRI loan, ATM, student account with minimum Rs. 100 etc. Bank can perform marketing activities by media.

THREATS :: Changes in government policies and in rules and regulation regarding bank can be disturbed in regular services of bank. Crises in the Co-operative banking sector can disturb the bank progress. All the depositors may withdraw their money from bank because of any wrong rumors against bank.

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FUTURE PLANS

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FUTURE PLANS
Rajkot peoples co-operative bank wants to starts new branches in different districts of Gujarat and as possible, may start at India level also. Peoples bank may also provide ATM facility if possible. Peoples bank wants to develop close relationship with individual and depositors. Peoples bank also wants to maintain growth and wants more growth. Peoples bank may provide various types of new loans like, student loan, NIR loan, and many more policies. Generally, Peoples bank mainly focuses on starting new branches in various place of India.

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SUGGESTION & CONCLUSION

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CONCLUSION
From the banks visit I learn a lot. Now I know that how the theoretically aspects are applied in the industries. I had found that all the staff members and workers are working in a co ordinates manner and in a planned way and they are more concentrating about their work and diversifying their efforts towards the desired target. Due to unprecedented trust and co-operation of the members and customers as well as continuous efforts put in by the management and the staff of Peoples Bank has been able to reach to the new heights of success. So, at the end I wish RAJKOT PEOPLES CO-OP. BANK LTD. and ALL THE BEST to get desired success in the future.

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SUGGESTION

Bank is not performing marketing activity because lack of marketing expertise for this bank should appoint skilled person who has a marketing knowledge. Bank is not providing A.T.M. facility in the recent developed era and many others facilities which are being providing by other banks so bank should try to provide or start this facility and other policies in near future. Bank has not large net work and not fully developed so bank should open new branches in different states of the India.

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BIBLIOGRAPHY

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BIBLIOGRAPHY

Web Site:: www.google.com www.rbi.com

Personnel Management

Ashwathappa C.B. Mamoria

Marketing Management

Phillip Kotler S.A. Sherlekar

Finance Management Annual Report of the Bank (2005)

I. M. Pandey

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