A PROJECT REPORT

ON

Organizations Profile

Name of organization

Punjab National Bank

Head Office

Bhikaji Cama Place, New Delhi

Origin of the Organization

Established in 1895 at Lahore, undivided India, Punjab National Bank (PNB) has the
distinction of being the first Indian bank to have been started solely with Indian capital.The
bank was nationalised in July 1969 along with 13 other banks. From its modest beginning,
the bank has grown in size and stature to become a front-line banking institution in India at
present.
A professionally managed bank with a successful track record of over
110 years.
Largest branch network in India - 4525 Offices including 432
Extension Counters spread throughout the country.
Strategic business area covers the large Indo-Gangetic belt and the
metropolitan centres.
Ranked as 248th biggest bank in the world by Bankers Almanac ,
London.
Strong correspondent banking relationships with more than 217
international banks of the world.
More than 50 renowned international banks maintain their Rupee
Accounts with PNB.
Well equipped dealing rooms; 20 different foreign currency accounts
are maintained at major centres all over the globe.
Rupee drawing arrangements with M/s UAE Exchange Centre, UAE,
M/s Al Fardan Exchange Co. Doha, Qatar,M/s Bahrain Exchange
Co, Kuwait, M/s Bahrain Finance Co, Bahrain,M/s Thomas Cook Al
Rostamani Exchange Co. Dubai,UAE, and M/s Musandam
Exchange, Ruwi, Sultanate of Oman.
VISION

"To be a Leading Global Bank with Pan India footprints and become a household brand in the
Indo-Gangetic Plains providing entire range of financial products and services under one roof"
MISSION
"Banking for the unbanked"
Origin
Punjab under the British especially after annexation in 1849 witnessed a period of rapid
development giving rise to a new educated class fired with a desire for freedom from the yoke
of slavery. Amongst the cherished desires of this new class was also an overriding ambition to
start a Swadeshi Bank with Indian Capital and management representing all sections of the
Indian community. The idea was first mooted by Rai Mool Raj of Arya Samaj who, as
reported by Lala Lajpat Rai, had long cherished the idea that Indians should have a national
bank of their own. He felt keenly "the fact that the Indian capital was being used to run
English banks and companies, the profits accruing from which went entirely to the Britishers
whilst Indians had to contend themselves with a small interest on their own capital".
At the instance of Rai Mool Raj, Lala Lajpat Rai sent round a circular to selected friends
insisting on an Indian Joint Stock Bank as the first special step in constructive Swadeshi. Lala
Harkrishan Lal who had returned from England with ideas regarding commerce and industry,
was eager to give them practical shape.
'PNB was born on May 19, 1894. The founding board was drawn from different parts of India
professing different faiths and a varied back-ground with, however, the common objective of
providing country with a truly national bank which would further the economic interest of the
country.
The Bank opened for business on 12 April, 1895. The first Board of 7 Directors comprised of
Sardar Dayal Singh Majithia, who was also the founder of Dayal Singh College and the
Tribune; Lala Lalchand one of the founders of DAV College and President of its Management
3

Society; Kali Prosanna Roy, eminent Bengali pleader who was also the Chairman of the
Reception committee of the Indian National Congress at its Lahore session in 1900; Lala
Harkishan Lal who became widely known as the first industrialist of Punjab; EC Jessawala, a
well known Parsi merchant and partner of Jamshedji & Co. of Lahore; Lala Prabhu Dayal, a
leading Rais, merchant and philanthropist of Multan; Bakshi Jaishi Ram, an eminent Civil
Lawyer of Lahore; and Lala Dholan Dass, a great banker, merchant and Rais of Amritsar. Thus
a Bengali, Parsi, a Sikh and a few Hindus joined hands in a purely national and cosmopolitan
spirit to found this Bank which opened its doors to the public on 12th of April 1895. They
went about it with a Missionary Zeal. Sh. Dayal Singh Majithia was the first Chairman, Lala
Harkishan Lal, the first secretary to the Board and Shri Bulaki Ram Shastri Barrister at
Lahore, was appointed Manager.
A Maiden Dividend of 4% was declared after only 7 months of operation. Lala Lajpat Rai was
the first to open an account with the bank which was housed in the building opposite the Arya
Samaj Mandir in Anarkali in Lahore. His younger brother joined the Bank as a Manager.
Authorised total capital of the Bank was Rs. 2 lakhs, the working capital was Rs. 20000. It had
total staff strength of nine and the total monthly salary amounted to Rs. 320.
The first branch outside Lahore was opened in Rawalpindi in 1900. The Bank made slow, but
steady progress in the first decade of its existence. Lala Lajpat Rai joined the Board of
Directors soon after. in 1913, the banking industry in India was hit by a severe crisis following
the failure of the Peoples Bank of India founded by Lala Harkishan Lal. As many as 78 banks
failed during this crisis. Punjab National Bank survived. Mr. JH Maynard, the then Financial
Commissioner, Punjab, remarked...."Your Bank survived...no doubt due to good
management". It spoke volumes for the measure of confidence reposed by the public in the
Bank's management.
The years 1926 to 1936 were turbulent and loss ridden ones for the banking industry the world
4

over. The 1929 Wall Street crash plunged the world into a severe economic crisis.
It was during this period that the Jalianwala Bagh Committee account was opened in the
Bank, which in the decade that followed, was operated by Mahatma Gandhi and Pandit
Jawaharlal Nehru. The five years from 1941 to 1946 were ones of unprecedented growth.
From a modest base of 71, the number of branches increased to 278. Deposits grew from Rs.
10 crores to Rs. 62 crores. On March 31, 1947, the Bank officials decided to leave Lahore and
transfer the registered office of the Bank to Delhi and permission for transfer was obtained
from the Lahore High Court on June 20, 1947.
PNB was then housed in the precincts of Sreeniwas in the salubrious Civil Lines, Delhi. Many
a staff member fell victim to the widespread riots in the discharge of their duties. The
conditions deteriorated further. The Bank was forced to close 92 offices in West Pakistan
constituting 33 percent of the total number and having 40% of the total deposits. The Bank,
however, continued to maintain a few caretaker branches.
The Bank then embarked on its task of rehabilitating the displaced account holders. The
migrants from Pakistan were repaid their deposits based upon whatever evidence they could
produce. Such gestures cemented their trusts in the bank and PNB became a symbol of Trust
and a name you can bank upon. Surplus staff posed a big problem. Fast expansion became a
priority. The policy paid rich dividends by opening up an era of phenomenal growth.
In 1951, the Bank took over the assets and liabilities of Bharat Bank Ltd. and became the
second largest bank in the private sector. In 1962, it amalgamated the Indo-Commercial Bank
with it. From its dwindled deposits of Rs. 43 crores in 1949 it rose to cross the Rs. 355 crores
mark by the July 1969. Its number of offices had increased to 569 and advances from Rs. 19
crores in 1949 to Rs. 243 crores by July 1969 when it was nationalised.
Since inception in 1895, PNB has always been a "People's bank" serving millions of people
throughout the country and also had the proud distinction of serving great national leaders like
5

Sarvshri Jawahar Lal Nehru, Gobind Ballabh Pant, Lal Bahadur Shastri, Rafi Ahmed Kidwai,
Smt. Indira Gandhi etc. amongst other who banked with us.

Punjab Keshari Lala Lajpat Rai (Saluting the spirit of our founding father)

(1865-1928)

The Life and Times of Lala Lajpat Rai

There are few leaders of the pre-independence era who, after having plunged themselves into
the political struggle, continued to take an active interest in social, cultural and educational
work. Lala Lajpat Rai was one of such leaders. Born on 28th January, 1865 at a small village,
Dhudike in the Ferozepur district of Punjab, he belonged to the Agarwal Baniya caste and it
was perhaps because of this, in addition to taking part in social and political life of the
country, he took keen interest in industrial and financial matter also. His father was a teacher
of Persian and Urdu in a government school.
Having passed the final examination in Law from Punjab University, he started his practice
in1883, when he was barely 18 years old. Endowed with a rich legacy of moral and
intellectual background, Lala Lajpat Rai had benefit of education in the practical rationalism
of western science combined with the religious purity and moral elevation of Eastern literature
that put on him the hallmark of true culture. While sympathizing with and aiding every
6

movement made for progress, Lala Lajpat Rai identified himself very closely with Arya
Samaj, in which he found ample scope for the exercise of his patriotism, philanthropy and
religious zeal.
Having qualified as a pleader, Lala Lajpat Rai started practice at Hissar and soon became a
leading lawyer of the district. He organized the Arya Samaj there and put it on proper lines. In
1892, he transferred his practice to the wider field at Lahore.Education, both secular and
religious, was in Lala Lajpat Rais view an important factor in national development. He took
part in the foundation of the D.A.V. College at Lahore.
Lalaji and Politics
Lala Lajpat Rai always felt drawn towards politics. It was in 1888 that he joined the Indian
National Congress when it met at Allahabad under the presidency of Mr. G. Yule. In 1905, the
Indian National Congress Committee having recognized in him an austere, sincere and selfless
devoted worker selected him as one of its delegates to place before the British, the political
grievances of the Indian people. He met the expenses of his trip from his own pocket. He
along with Gokhale carried on the political campaign in various parts of England and brought
home to the mind of the British, the evils of an unsympathetic and bureaucratic government
under which India was labouring and pleaded in eloquent language, adding facts and figures in
supporting their contention, cause of the half starving and half dying people of India. Lala
Lajpat Rai created an impression on the English Populace.
After his return from England, he was busy devising and organizing ways and means for
political advancement and industrial emancipation of the country.
The movement of Swadeshi was in the offing and he put his heart and soul into it. He
preached the message of Swadeshi to the people of Punjab and made it very popular. This
naturally enraged the bureaucracy and he came to be regarded as a revolutionary by the
Britishers and the Anglo-Indian press. He was openly dubbed as a Revolutionary and an
7

instigator of the armed forces.

The Jalianwala Bagh tragedy and the Government's denial to censure the conduct of its
officers made him a complete non cooperator. He lost his faith in the British and threw himself
whole heartedly into the non-cooperation movement.In 1925, he joined the Swaraj Party and
became its deputy leader. He took active part in the deliberations of the debates of the
Assembly. It was he, who moved the resolution for the Boycott of the Simon Commission in
the Assembly. It was while leading the boycott procession at Lahore on the 30th October, 1928
that he received lathi blows on his chest which ultimately brought about his death on the 17th
November, 1928.
Lala Lajpat Rai and PNB
Lalaji was keenly concerned with the fact that though Indian capital was being used to run
English Banks and companies, the profits went entirely to the British, while Indians had to
contend themselves with a small interest on their capital. He echoed this sentiment in one of
his writing while concurring with Rai Mul Raj of Arya Samaj who had long cherished the idea
that Indians should have a National Bank of their own. At the instance of Rai Mul Raj, Lala
Lajpat Rai sent a circular to selected friends insisting on an Indian joint stock Bank as the first
step in constructive Swadeshi and the response was satisfactory
After filing and registering the memorandum and Articles of Association on 19 May, 1894, the
bank was incorporated under Act VI of the 1882 Indian Companies Act. The prospectus of the
bank was published in the Tribune, and the Urdu Akhbar-e-Am and Paisa Akhbar. On 23rd
May, 1894, the founders met at the Lahore residence of Sh. Dyal Singh Majithia, the first
Chairman of PNB, and resolved to go ahead with the scheme. They decided to hire a house in
the famous Anarkali Bazar of Lahore opposite the post office and near well known stores of
Rama Brothers.On 12th April 1895, the Bank opened for business, a day before the great
Punjab festival of Baishakhi. The essence of the Banks culture was clear at this first meeting
8

itself. The fourteen original shareholders and seven directors took only a modest number of
shares; the control of the Bank was to lie with the large, dispersed shareholders, a purely
professional approach that was as uncommon then as it is today.
Heritage : Saga of Excellence in Banking

Fired by the spirit of nationalism and founded on the idea that Indians should have a national
bank of their own, Punjab National Bank Ltd was the result of the efforts of far-sighted
visionaries and patriots, among whom were persons like Lala Lajpat Rai, Mr. E C Jessawala,
Babu Kali Prasono Roy, Lala Harkishan Lal and Sardar Dyal Singh Majithia. Incorporated
under the Act VI of 1882, Indian Companies Act, the Bank commenced operations on April
12, 1895 from Lahore, with an authorised total capital of Rs 2 lac and working capital of Rs
20,000. Prophetically, the Bank chose "Stability" as its telegraphic address, as the future
course of events were to prove - the Bank withstood various financial crises including the
trauma in the form of partition of India when the Bank had to close 92 offices (33%) in west
Pakistan which constituted 40% of its deposits and 15 of its staff fell victims to the frenzy. The
registered office was shifted to Delhi and the Bank honoured all the deposit claims of the
refugees even on the basis of whatever little evidence they could produce. Subsequently, the
Bank registered impressive performance and grew from strength to strength.
A pioneer throughout, the Bank distinguished itself by appointing auditors in 1895 long before
it was mandatory; introduced the "teller" system in 1944 (another first ); established profit
sharing bonus, provident fund and voluntary outside audit well before they formed keystones
of good management.
Nationalisation came in 1969 which unleashed a new chapter in the long history of the Bank.
Keeping with the economic ideology of catalyzing development and amelioration of poverty
by funding various self-employment schemes, PNB expanded its presence rapidly in
9

unbanked areas. The Bank donned the role of a facilitator in providing the vital input of credit
and consistently exceeded the national goals in respect of priority sector lending. With its
large presence throughout the country and with a view to strengthening the rural credit
delivery system, the Bank sponsored Regional Rural Banks (RRBs).
PNB has established itself firmly as one of the premier banking institutions in the country with
a long tradition of sound and prudent banking. The bank's growth has been aided by takeover/merger of 7 private sector banks during different periods in its history. The first ever and
the only merger of a nationalized bank with PNB was in 1993, viz., New Bank of India.
By late 1980s when the first whiff of liberalization came about, the Bank initiated strategic
moves towards diversification; and in 2002, 20% of government ownership was disinvested
through a very successful IPO to the public. In 2003, the erstwhile Nedungadi Bank Ltd (eNBL), a Kerala based private bank was amalgamated with Punjab National Bank. This was
the seventh merger in PNBs history of more than 115 years. PNBs management team has
been quite successful in managing the mergers and ensuring the integration process in a
smooth and effective manner. It may be added that no other bank in the nationalized bank
group has a track-record of so many mergers. This has improved the franchise value of the
Bank, particularly, in the relatively underrepresented Kerala region. In order to meet future
capital requirements on account of implementation of Basel II norms, in March 2005, the
Bank came out with Follow-on Public Offer (FPO) through the book building process,
reducing the shareholding of Govt of India to 57.8%.
Punjab National Bank with more than 5400 domestic offices including Extension Counters has
the largest network amongst the nationalized banks i.e. next only to SBI. The bank has a
strong franchise value and provides a host of financial products and services, both to the retail
customer and corporate business. It has continued to fulfill its social responsibilities and made
significant progress in adoption of technology, keeping with its objective of transforming itself
10

into a techno-savvy Bank.

During 2008-09, the Bank achieved the landmark of becoming the largest Nationalized Bank
to bring ALL BRANCHES/EXTENSION COUNTERS into Core Banking Solution (CBS).
The strong franchise enjoyed by the Bank, combined with its technological capabilities
provides the Bank competitive advantages.
The Bank also continues to discharge its social obligations and addresses environmental
concerns with added vigour, which include free medical camps, distribute artificial limbs, tree
plantation and blood donation camps, besides donations to Hospitals, Schools etc. The Bank
supports various societies, charitable institutions and NGO /organisations working for the
benefit of downtrodden, weaker sections of society, orphans, underprivileged, spastics,
handicapped, mentally retarded children, women in shelter homes, etc. The Bank also
contributes for fighting diseases like diabetes, tuberculosis, AIDS, leprosy etc. Donations are
also extended for purchase of water coolers, ambulances and building infrastructure facilities
at hospitals/schools.

11

Subsidiaries:
A. Domestic:
Country of

Proportion of ownership

Sr No. Name of the Entity

i)
ii)
iii)
iv)

Incorporation
PNB Gilts Ltd.
India
PNB Housing Finance Ltd.
India
PNB Investment Services Ltd.
India
PNB Insurance Broking Pvt.
India
Ltd.#

%
74.07
51.01
100
81

# PNB Insurance Broking Company is non-functional. The Broking licence has been
surrendered and steps are being initiated for winding-up of the Company.
Domestic Subsidiaries
1. PNB GILTS LTD.
PNB Gilts Ltd., a subsidiary of the Bank, is engaged in the business of trading in Govt.
securities, treasury bills and Non SLR Investments. It is also engaged in dealing in Money
Market Instruments (Call/Notice/Term Money, Repo /Reverse Repo, Inter-corporate
Deposits, Commercial Paper, Certificate of Deposit) and Mutual Funds Distribution. The
company is listed at NSE and BSE.
2. PNB HOUSING FINANCE LTD
PNB Housing Finance Ltd. is engaged in providing housing loans for purchase, construction
and up gradation of a dwelling unit. The company offers Loans for construction or for
purchase of house/flat from development authorities and also from private builders/ group
housing societies as well as for renovation/ repairs. Company also provides finance for

12

construction of residential projects. Loans to NRIs are also provided for purchase/
construction of house/ flat along with a resident/ non-resident co-borrower.
3. PNB INVESTMENT SERVICES LTD
PNB Investment Services Ltd, a wholly owned subsidiary, has been set up by the Bank for
carrying out Merchant Banking Business. It provides services for Project Appraisal, Loan
Syndication, Debt Placement and to executes IPOs/FPO/QIPs. PNBISL is registered with
SEBI as a Category- I Merchant Banker.
4. PNB INSURANCE BROKING Pvt. Ltd.
The Bank is holding majority stake in above company, jointly with Vijaya Bank, minor
shareholder.
Domestic Joint Ventures
The Bank has the following Joint Ventures:
1.

Principal PNB Asset Management Company Pvt. Ltd

2.

Principal Trustee Company Pvt. Ltd

B. International:

Sr. No

Name of the Entity

Country of

Proportion of

Punjab National Bank (International)

incorporation
United

ownership
100%

Druk PNB Bank Ltd

JSC SB PNB Kazakhstan

Kingdom
Bhutan
Kazakhstan

Ltd.
2
3

51%
84.375%

Associates: (Bank having 20% or more stake)

13

A. Domestic:

Sr. No.

Name of Regional Rural Banks / Other Associates

Proportion of
ownership

1
2
3
4
5
6
7
8

Madhya Bihar Gramin Bank, Patna

Sarva Haryana Gramin Bank, Rohtak
Himachal Gramin Bank, Mandi
Punjab Gramin Bank, Kapurthala
Sarva UP Gramin Bank, Meerut
Principal PNB Asset Management Co. Pvt. Ltd.
Principal Trustee Co. Pvt. Ltd.
PNB Metlife India Insurance Company Ltd

35%
35%
35%
35%
35%
21.38%
30%
30%

B. Outside India:

Sr.

Name of the Entity

Country of

Proportion of

Everest Bank Ltd.

incorporation
Nepal

ownership
20%

No
1

Growth and Development

With over 38 million satisfied customers and 4668 offices, PNB has continued to retain its
leadership position among the nationalized banks. The bank enjoys strong fundamentals,
large franchise value and good brand image. Besides being ranked as one of India's top
service brands, PNB has remained fully committed to its guiding principles of sound and
prudent banking. Apart from offering banking products, the bank has also entered the credit
card & debit card business; bullion business; life and non-life insurance business; Gold coins
& asset management business, etc.

Since its humble beginning in 1895 with the distinction of being the first Indian bank to have
been started with Indian capital, PNB has achieved significant growth in business which at
the end of March 2009 amounted to Rs 3,64,463 crore. Today, with assets of more than Rs
2,46,900 crore, PNB is ranked as the 3rd largest bank in the country (after SBI and ICICI
Bank) and has the 2nd largest network of branches (4668 including 238 extension counters
14

and 3 overseas offices).During the FY 2008-09, with 39% share of low cost deposits, the
bank achieved a net profit of Rs 3,091 crore, maintaining its number ONE position amongst
nationalized banks. Bank has a strong capital base with capital adequacy ratio as per Basel II
at 14.03% with Tier I and Tier II capital ratio at 8.98% and 5.05% respectively as on
March09. As on March09, the Bank has the Gross and Net NPA ratio of only 1.77% and
0.17% respectively. During the FY 2008-09, its ratio of priority sector credit to adjusted net
bank credit at 41.53% & agriculture credit to adjusted net bank credit at 19.72% was also
higher than the respective national goals of 40% & 18%.
Present Status of the Organization
PNB has always looked at technology as a key facilitator to provide better customer service
and ensured that its IT strategy follows the Business strategy so as to arrive at Best Fit.
The bank has made rapid strides in this direction. Alongwith the achievement of 100% branch
computerization, one of the major achievements of the Bank is covering all the branches of
the Bank under Core Banking Solution (CBS), thus covering 100% of its business and
providing Anytime Anywhere banking facility to all customers including customers of more
than 2000 rural branches. The bank has also been offering Internet banking services to the
customers of CBS branches like booking of tickets, payment of bills of utilities, purchase of
airline tickets etc.Towards developing a cost effective alternative channels of delivery, the
bank with more than 2150 ATMs has the largest ATM network amongst Nationalised Banks.
With the help of advanced technology, the Bank has been a frontrunner in the industry so far
as the initiatives for Financial Inclusion is concerned. With its policy of inclusive growth in
the Indo-Gangetic belt, the Banks mission is Banking for Unbanked. The Bank has
launched a drive for biometric smart card based technology enabled Financial Inclusion with
the help of Business Correspondents/Business Facilitators (BC/BF) so as to reach out to the
last mile customer. The BC/BF will address the outreach issue while technology will provide
cost effective and transparent services. The Bank has started several innovative initiatives for
marginal groups like rickshaw pullers, vegetable vendors, diary farmers, construction
workers, etc.
The Bank has already achieved 100% financial

inclusion in 21,408 villages.

Backed by strong domestic performance, the bank is planning to realize its global aspirations.
In order to increase its international presence, the Bank continues its selective foray in
15

international markets with presence in Hongkong, Dubai, Kazakhstan, UK, Shanghai,

Singapore, Kabul and Norway. A second branch in Hongkong at Kowloon was opened in the
first week of April09. Bank is also in the process of establishing its presence in China,
Bhutan, DIFC Dubai, Canada and Singapore. The bank also has a joint venture with Everest
Bank Ltd. (EBL), Nepal.
Future Expansion of the Organization
Under the long term vision, Bank proposes to start its operation in Fiji Island, Australia and
Indonesia. Bank continues with its goal to become a household brand with global expertise.
Amongst Top 1000 Banks in the World, The Banker listed PNB at 250th place. Further,
PNB is at the 1166th position among 48 Indian firms making it to a list of the worlds biggest
companies compiled by the US magazine Forbes.

Parameters
Operating Profit*
Net Profit*
Deposit

Mar'07
3617
1540
139860

Mar'08
4006
2049
166457

Mar'09
5744
3091
209760

CRAR
26.02
41.67
22.47

Advance
Total Business

96597
236456

119502
285959

154703
364463

26.55
24.15

(Rs. In Crores)
* Respective figure for the corresponding financial year

Departments of The Organization

The bank has following organization
Finance
Personal Administration
16

Human Source
Sales & Marketing
Retailing
Treasury Management
Information Technology

Product Profile of the Organization

Saving Account

PNB Prudent Sweep

Total Freedom Salary Account

PNB Vidyarthi Salary Account

PNB Mitra SF Account

Current Accounts

Smart Romer

PNB Vaibhav

PNB Gaurav

Fixed Deposit Accounts

Spectrum fixed deposit scheme

Anupam account

Multi benefit deposit scheme

Special fixed deposit scheme

Recurring deposit scheme

PNB swecha jama yojna/flexi rd

17

Credit schemes

Housing loan

Car finanace

Personal loan

Professional loan

Educational loan scheme

Loan against mortgage of property

PNB financial basket scheme

Personal loan scheme for pensioners

Privilege card scheme

Other credit scheme

Social Banking

Farmers

Krishi card

Agriculture credit scheme

PNB farmers welfare trust

Scheme for house wife and other women

Mahila udhyam nidhi scheme

Women

Savings Accounts
TOTAL FREE DOOM SAVING FUNDS SALARY ACCOUNT
Purpose: To offer an attractive Saving Fund Account to Corporate Employees for enabling
them to have their Salary Credited as well as availing overdraft facility up to Rs. 15,000/- or
the last salary credited in the account whichever is lower, at our interest rates applicable to
18

Personal Loans to employees, it would be adjustable in bullet repayment at the time of next
salary credit
ELIGIBILITY: OF THE EMPLOYEE AS WELL AS CORPORATES UNDER TIE-UP
ARRANGEMENT:
The employee whose salary account is being opened should be a permanent
The minimum number of accounts to be opened should be 25 or 75% of the
permanent employees of the corporate (in that location),

employee.

strength of the

whichever is lower.

Initial Deposit and Minimum Balance Requirements : Zero

Service Charges : It will be a ZERO CHARGES ACCOUNT, i.e., the customer would not be
subjected to any charges in respect of any of the services related to this account.

Other facilities offered :

Free Cheque Books for routine requirements (except bulk requirements for
availed at any other bank- in that case normal cheque book

loans to be

charges would be levied);

Free Statement of Accounts;

Free inter-sol transactions;
Free funds transfer from their accounts within our CBS branches and at 50% discount at nonCBS branches;
Free issuance of all types of certificates including interest certificate and

balance certificate,

etc;
Free of Cost maintenance of Demat Account (we shall be waiving the charges
by PNB as annual fee, charges payable to NSDL would be

to be earned

recovered from the customers);

50% discount in one locker at the branch convenient to the customer;

19

Free of Cost PNB Debit/ ATM Card;

PNB-HSBC Credit Cards shall also be got considered by HSBC on priority

basis

Eligibility
Accounts can be opened in the name of students who have attained the age of 10 years and above,
studying at VARIOUS RECOGNISED EDUCATIONAL INSTITUTIONS.
Initial Deposit Amount/ QAB/Minimum Balance Required
Zero
Overdraft Facility
The overdraft facility shall be given to students (of reputed educational institutions only) who are
staying away from their parents. It would be made available on the request of the student with the
UNDERTAKING TO PAY/ CONSENT LETTER from earning parents/natural guardian/local guardian
of student. In the first year of opening of account, the facility would be available up-to a maximum limit
of Rs.5,000/-. Subsequent to the satisfactory conduct of the account, in second year it could be enhanced
upto Rs. 10,000/-. Other terms & conditions of this overdraft facility would be as under:
Rate of Interest
The overdraft facility would attract at the rate of interest as applicable to
Age of Student

Personal Loans to the general public.

The overdraft facility would be available for the students, having completed

Purpose

the age of 18 years

Contingent day to day needs of those students who are staying away from
their parents for the study purposes having got an admission with recognised

Repayment

and reputed educational institutions.

For repayment purposes, a single post dated cheque must be obtained from

Recovery Aspects

earning parents/natural guardian/local guardian of student and kept on record.

The overdraft facility must be brought into credit once in 3 months, failing
which recovery process be started. The facility would be recalled and the
student would not be eligible for this overdraft facility at any branch of our
Bank. In any case, this facility should not be allowed to continue when the
student is in the final year of study at that educational institution, i.e. account
has to be got into credit at least six month before the expiry of the tenure of
the study period without any further continuation of overdraft facility.

Attractive Freebies/Concessions
The following freebies are also admissible:
Demand drafts for all types

Free of cost

of fees/examination fees
Initial Deposit Amount

The account will be opened without any initial deposit, i.e., it

20

Incidental Charges
Ledger Folio Charges
Retail
Internet
Services
Intersol transactions

Will be Zero Balance Saving Fund Account

NIL
NIL
Free (at CBS branches only)

Banking

including Free

cash withdrawal/deposits
ATM Card/DEBIT CARD
Cheque Book Facility

Free (subject to availability of ATMs in the area)

Free (2 cheque books in a year)

NO-FRILLS SAVING BANK ACCOUNT FOR FINANCIAL INCLUSION

OF OOREST/DESERVING SECTIONS OF SOCIETY
To ensure the financial inclusion of the poorest / deserving sections of the society,
PNB has launched a No-frills Savings Bank Account Scheme known as PNB
MITRA SAVINGS BANK ACCOUNT that can be opened by an
INDIVIDUAL singly or jointly, minors of the age of 10 years and above, minors
under natural/legal guardianship. An illiterate or a visually impaired person is
also eligible to open account under the scheme with usual safeguards. Simplified
KYC procedures may be adopted for opening of these accounts.
Product Highlights :
Initial

opening

ZERO

of

account

MINIMUM

with

just

BALANCE

Rs.25/-,
requirement;

Our Bank would allow first 50 transactions in a calendar year Free of Charge,
thereafter

charge

of

Rs.10/-

per

transaction

would

be

levied.

Customer would not be allowed to keep balance in this account (taken together
with all

other accounts with our Bank) more than Rs.50,000/- in this account

in

view

of

related

KYC

Norms;.

NO FREE OF COST CHEQUE BOOKS;

21

PNB SMART ROAMER

The product is aimed at offering Current Account Customers convenient opportunity to earn
extra-returns on surplus funds lying in the accounts which may not normally be utilised in the
near future or are likely to remain un-utilized. The automated nature of the facility for 'Sweep
In or Sweep Out' of more than a lac of rupees, and creating fixed deposits for desired period,
would save lot of operational hassles and create Customer Value. Roaming Features: The
Customers would be able to operate their 'Current Comfort' at all other CBS branches of our
Bank. It will facilitate transfer of funds as well as much faster cheque collection services for
the customers, simultaneously customers will be able to withdraw cash from our CBS
branches.
Sweep in and Sweep out Features:
The Customer shall be able to profitably deploy his funds which were earlier not
attracting any interest. Funds (above Rs. One Lac) lying in Current Accounts and their
ready availability when required for payment/clearance of cheques. The bank would provide
the facility of automatic transfer of balance from Current Accounts having a balance of over
Rs.1,00,000/- (Rupees one lac only) in multiples of Rs.10,000/- (Rupees Ten Thousand
Only) to Fixed Deposit Accounts. Sweep In Funds would be accepted for a minimum
maturity period of 15 days and Maximum maturity period of 45 days. It will be optional
for the customers to indicate desired periodicity in multiples of 15 days. The customer would
get the interest on such deposit at the term deposit rate applicable for the period indicated by
him/her.
Additional Features
(subject to maintenance of stipulated 'minimum balance' in the account throughout during
previous quarter i.e. clear balance on the closing of everyday should have been Rs.25,000/- or
above) :
i.

Free ATM Card;

ii.

Free Debit Card (slated to be introduced by the Bank shortly-publicity on this aspect
will begin only after launch)

iii.

Free remittance of funds upto an extant of Rs. 25000/- per month at any of our
branches having connectivity under CBS.
22

iv.

One Cheque book of 50 leaves free of cost per quarter to be issued (inclusive of item
no. xii)

v.
vi.

Free e-mails for statement of account on monthly basis

Same day Credit for outstation cheques drawn on other branches of our Bank under
CBS Connectivity

vii.

Free collection of one outstation cheque (issued in favour of customer) per quarter
upto Rs. 10000/-(however, out of pocket expenses shall be recovered)

viii.

Immediate credit of outstation cheques upto 15,000/-

ix.

25% concession on Annual Custody Charges for Demat Services

x.

25% concession on service charges for providing EFT Services;

xi.

Transaction i.e. T + 3 Days' Credit for outstation cheques drawn on other bank
branches at locations where we have at least one PNB branch under CBS connectivity.

xii.

If possible, Free Special Cheque Book (under relevant MICR Code) shall also be
issued to customers enabling them to make payment by cheque to outstation parties at
CBS centers.
PNB VAIBHAV ACCOUNT

Features
Quarterly average balance required
Initial Deposit Amount required for opening of the account.
Non-maintenance charges
Free
(of
transaction
charges)
Transactions allowed
Transaction charged/L.F. charges
Inter
sol
transfer
Local non-base branches
Inter
sol

transfer

charges

Rs.5,00,000/- and above

Rs.5,000/Rs.3000/- Qty.
Unlimited

Free
Free
charges- Free

Outstation non-base branches

Outstation/local-cheques/ Bills, etc. collection charges
Free Statement on request.
Statement of Account(e-mail on request)
Remittance charges/Drafts issuing, etc.
Standing Instructions Regn.
De-mat A/c Charges (except charges to be paid by Ban to

50% discount on normal charges

Upto 4 in a month
Free on monthly basis
50% discount on normal charges.
Free
First Year Free
23

NSDL)
Rebate on Locker Rent (of any size)
Internet Banking Services
Debit-cum-ATM Card
RTGS Services
Personalised Multi-City Cheque Book
Stop Payment Instruction charges
Interest/Balance certificate
Cash Withdrawals/Deposits charges at Local Non-Base

50% rebate in locker rent of one locker

Free
Free
50% concessions on normal charges.
UNLIMITED
Free
Free
Rs.5 lac per day, thereafter 50%

Branches, free upto:

discount on normal charges.
Cash Withdrawals/Deposits charges at outstation Non-Base Rs.1 lac per day, thereafter 50%
Branches, free upto
Charges on payment of outstation Multicity Cheques, Free upto

discount on normal charges

Rs.1 lac per day, thereafter 50%
discount on normal charges.

PNB GAURAV CURRENT ACCOUNT

Features
Quarterly average balance required
Initial Deposit Amount required for opening of the account.
Non-maintenance charges
Free
(of
transaction
charges)
Transactions allowed
Transaction charged/L.F. charges
Inter

sol

transfer

Local non-base branches

Inter
sol

transfer

Rs.1,00,000/- and above

Rs.5,000/Rs.1200/- Qty.
200 in a quarter
Rs.2/- per transaction beyond 200

transaction.
Free

charges

charges- Upto Rs.50,000/- per day no

Outstation non-base branches

charges, thereafter, 50% discount

Outstation/local-cheques/ Bills, etc. collection charges

Free Statement on request.
Statement of Account(e-mail on request)
Remittance charges/Drafts issuing, etc.
Standing Instructions Regn.

on normal charges.
25% discount on normal charges
Upto 2 in a month
Free on Quarterly basis
20% discount on normal charges.
50% concessions on normal

charges.
De-mat A/c Charges (except charges to be paid by Ban to First Year Free
NSDL)
Rebate on Locker Rent (of any size)

25% rebate in locker rent of one

Internet Banking Services

Debit-cum-ATM Card

locker
Free
Free
24

Cash Withdrawals/Deposits charges at outstation Non- Rs.50,000/- per day, thereafter 25%
Base Branches, free upto
discount on normal charges
Charges on payment of outstation Multicity Cheques, Rs.50,000/-per day, thereafter
Free upto

25%

discount on normal charges.

A Multi-Option Fixed Deposit Scheme that fit your needs, timing & resources, to match your
convenience

Initial Deposit of Rs.1000/-only, and thereafter in convenient multiples of any amount

of Rupee one

Period of Deposit: (a) Maturity Option: For any period from 15 days to 120 monthsFor a single Term Deposit less than Rs. 15 lac and for any period from 7 days to 120
months-For

single

Deposit

of

Rs.

15

lac

&

above.

(b) Income Option: For any period from 6 months to 120 months.

At PAR Collection of Fixed Deposit Receipt

Payable at par at all CBS branches(premature payment, loans andother miscellaneous

matters before maturity of the FDR shall be attended to only by the issuing branch)

Multiple options available for interest payment viz. Monthly/Quarterly/HalfYearly/Yearly or on maturity

For an amount of Rs. 10,000/- and above overdraft with cheque book facility is
available, to enable use of deposits. The customer shall also be at liberty to make use
of the facility through ATM-cum-Debit Card under 'Anywhere-Anytime Banking'. It
will enable customers to have freedom to utilise their Fixed Deposits as and when
needed without even coming to the Bank. The interest is chargeable only for the
amount and period for which the overdraft facility has been availed; The illiterate and
blind persons can also open the account without exercising the option of Overdraft
Facility.

Margin and rate of interest on Loans against deposits under the scheme shall be as per
prescribed guidelines which shall be subject to modifications from time to time

Automatic payment of LOCKER rent out of Interest proceeds

25

RTGS S

Stop Pa
Interest

Conversion facility regarding mode of payment of interest allowed;(provided FDR

has been issued for a period of 12 months or more and remaining period of FD is
more than 6 months) without invoking any penal provision

Premature withdrawal of Deposit without any penalty

Automatic Renewal facility is provided as per option exercised by the depositor

Availability of premature extension

Part withdrawal in multiples of Rs.1000/- without loss of interest on remaining FDR

ANUPAM ACCOUNT
Our Bank has several Domestic Deposit Schemes designed to cater to the needs of
various segments of customers to meet your specific requirement.
The features of the Anupam Account Deposit Scheme are as under:
1. Participation
Anupam Account Scheme may be opened in the name of individual(s), sole
proprietorship concern, partnership firm, association, trust, Ltd. Company etc.
However, Anupam Account shall not be opened in the name of a minor, illiterate and
blind persons.
2. Minimum Initial Deposit
Rs.10,000/- and thereafter in multiples of Rs.1000/- thereof.
3. Period of Deposit
For any period from 6 months to 120 months. Existing deposits under Multi Benefit
Deposit Scheme for Rs.10,000/- and above with unexpired term of 6 months or more
are eligible for transfer to Anupam Account Scheme.
4. Overdraft Facility
26

Overdraft facility shall be permitted through a Current Account and a Cheque Book
will be issued to the depositor on the same day.
The margin on the amount of overdraft against the deposit is
For Public
Maturity Period remaining at the time of granting
overdraft

Margin

Upto 2 years

5%

Above 2 years and upto 3 years

7.5%

Above 3 years and upto 4 years

10.0%

Above 4 years and upto 5 years

12.5%

Above 5 years

25%

5. Third Party Advance

Only depositors can avail overdraft facility against their deposits under this scheme.
No third party advance ie Credit Facility / overdraft to persons other than depositors is
allowed under Anupam Account. Even the overdraft facility to a proprietorship firm
against Fixed Deposit in the name of its proprietor is not allowed.
6. Premature withdrawal of Deposit
If any depositor desires to withdraw the deposit before maturity, Bank may at its
discretion repay the deposit with upto date quarterly compounded interest at the rate
applicable to the period for which deposit remained with the bank
7. Facility of Further Fixed Deposit in the same Anupam Account
Further, Fixed Deposit can be accepted in the same Anupam Account on your request
and the limit in the overdraft account be increased accordingly against the additional
deposit and it will also be endorsed in the Receipt Form with you.
8. Renewal of Term Deposit on Maturity
Renewal of Fixed Deposit is permitted at your request, if no overdraft is outstanding
against it.
27

9. Withdrawable in multiples of Rs.1000/You may withdraw any amount before maturity anytime as well in multiples of
Rs.1000/- any time according to your convenience without breaking the entire deposit
and also without losing interest on remaining part of Fixed Deposit Receipt under the
Scheme.

MULTI BENEFIT FIXED DEPOSIT SCHEME

It entitles you to earn interest at term deposit rates on quarterly compounding basis.
You may open with any amount with a minimum deposit of Rs.1000/- for any
period from 6 months to 120 months.
You can avail the additional facility of automatic renewal of fixed deposit with or
without interest on maturity.
On demand, Loan in this MBFD scheme is also made available by us.

Interest at term deposit rates is computable on quarterly compounded

basis
The small monthly savings in the Recurring Deposit scheme enable
you to accumulate a handsome amount on maturity.

Account can be opened with a minimum monthly deposit of Rs.100/or its multiples for a period of 6 months to 120 months in multiples
of 3 months.
Interest at term deposit rates is computable on quarterly compounded
basis
The small monthly savings in the Recurring Deposit scheme enable
you to accumulate a handsome amount on maturity.
28

PNB SWICHA JAMA YOJNA/FLEXI

Individuals can open account, singly or jointly, by a minor of the age of 10 years and
above in his name or through his guardian.
A depositor can choose a monthly installment with a minimum of Rs.100 or above in
its multiples. However, the subsequent monthly installment will not exceed ten times
of such core amount without any ceiling on maximum amount. No matter, even if
the monthly installment is skipped.
Deposit accepted for any period from 6 months to 120 months and interest is paid at
term deposit rates on half yearly basis.

Credit Scheme
Housing Loan
Car Loans
Own a vehicle with the friendliest and most convenient car loan. Either you can
purchase a new Car/ Van/ Jeep or raise loan to purchase old vehicles that are not
older than 3 years. Finance will be provided for purchase of vehicle of indigenous/
foreign makes.
Individuals as well as Business Concerns (Corporate or non-corporate).
For Individuals: 25 times of the monthly net salary OR Rs.15 lac, whichever is
lower. Income of spouse can be taken into account for determining loan amount. In
such cases, the spouse shall stand as a guarantor.
For Business Conerns: No ceiling on loan amount.
The vehicle purchased with the amount of loan is to be hypothecated to the Bank. It
will be registered in the name of the borrower jointly with the Bank.

Guarantee of spouse, if employed or third party guarantee, OR

Collateral Security in the shape of either Immovable Property or Liquid

29

Security equivalent to 100% of loan amount

For new Car/ Van/ Jeep: The loan amount together with interest is to be repaid
maximum in 84 Equated Monthly Instalments (EMIs)
For old Car/ Van/ Jeep: The loan amount together with interest is to be repaid
maximum in 60 Equated Monthly Instalments (EMIs)
1% of the loan amount unt, with a maximum of Rs.4,000/Rs.300/- upto Rs.2 Lac
Rs.500/- over Rs.2 Lac
The intending borrower will be required to settle the transaction for purchase of
vehicle needed by him/her with the seller and will be required to deposit the
difference of the cost of the vehicle to amount of loan, and thereafter, the advance
will be allowed to him/her from the bank by paying the entire price of the vehicle to
the seller directly on behalf of the borrower
) All permanent Defence Personnel including officials of Military Station
Headquarters,

BSF,

CRPF,

CISF,

ITBP

ii) Confirmed/ permanent employees of Central/ State Govt/ PSUs and all reputed
companies/ Institutions, who are drawing their salary through accounts maintained
with
Employees

our
of

above

branches.
categories

under

check-off

facility

iii) Professionally qualified Doctors viz. MBBS, BDS & above having annual
income

of

Rs.4.00

lac

&

above.

Minimum Net Monthly Income

-

Rs.15000

per

month

for

eligible

customers

- Rs.12500 per month for eligible customers

at

Metro

Centres;

at Urban Centres; and

- Rs.10000 per month for eligible customers at Semi-Urban and Rural Centres.
However, for Teachers, Army Jawans, other permanent employees of Military
Station Headquarters and Para Military Personnel whose salary is being credited and
30

disbursed through our branches the minimum Net Monthly Income criteria shall be
Rs.7500/- at all Centres viz. Metro, Urban, Semi-Urban and Rural.
Term Loan/ Overdraft Minimum amount of loan will be Rs.50,000/- and maximum
amount of loan Rs.4,00,000/- or 20 times monthly net salary, whichever is lower,
depending upon the repaying capacity.
Term

Loan:

60 Equated Monthly Instalments (EMIs) OR remaining period of service, whichever

is earlier. Instalment to commence one month after disbursement of loan.
Overdraft:
The overdraft limit shall be adjusted within a maximum period of 60 months by
reducing Drawing Power(DP) equivalent to EMI amount at the beginning of every
month.
However, loan allowed to Army Jawans, other permanent employees of Military
Station Headquarters and Para Military Personnel shall be Repayable in maximum
36 Equated Monthly Instalments or remaining period of stay at the particular
posting, whichever is lower

In Case of Employees of Govt./Institutions etc.

In case of employees of government/institution etc., irrevocable letter of authority

from the borrower to remit salary/installment and other amount payable to bank.
Post dated cheques towards monthly installments be obtained from the borrower
under the cover of letter of deposit (Mandate of the borrower conveying deposit of
PDCs

for

appropriation

in

the

loan

account).

Where the employer agrees to check off facility, at least one PDC to be obtained.
In case of Army Officers :

In case of Army Jawans, Other permanent employees of Military Station

Headquarters and Para Military Personnel (Undertaking to be obtained from the
31

Station Commandant/ Unit Incharge at the time of retirement/death/transfer of a

particular Jawan/Personnel or on transfer of a unit, loan under the scheme will get
adjusted.)
Professional Loan Schemes
PNB extends assistance to self-employed persons, firms and joint ventures of such
professional persons engaged in professions such as:
Medical practitioners including dentists, chartered accountants, cost accountants,
practicing company secretaries, who are not in regular employment of any employer,
accredited journalists or cameramen who are free lancers, i.e. not employed by a
particular newspaper/magazine, lawyers or solicitors, engineers, architects,
surveyors, construction contractors or management consultants or to a person trained
in any other art or craft who holds either degree or diploma from any institution
established, aided or recognised by Government or to a person who is considered by
the bank as technically qualified or skilled in the field in which he is engaged. Loans
under this scheme may be granted for the purpose of financing purchase of
equipment used by the borrowers, business premises, construction, making
alterations or renovation of business premises/nursing homes or for working capital
requirements, in their professions.
Persons already practicing or new entrants in various professions, having licenses
issued under Central or State Legislations;
Associations of persons engaged in a single profession provided that each member
of such an association is qualified and duly licensed to practice in the profession;
and
The qualified professionals will be required to produce a certified copy of the license
for the record at the bank.
Need based on merits within the overall permissible limits as under:
Metro/ Urban

S.Urban/Rural Area
32

1. Medical practitioners

Rs 5.00 lac

Rs 10.0 lac

2. Other professionals

Rs 5.00 lac

Rs

5.00 lac

Margin: Nil up to Rs.25000/-. 25% Above Rs. 25000/-.

Hypothecation/Mortgage of the goods purchased/created with the amount of loan till
the final adjustment of bank's loan and interest thereon.
Collateral security by way of immovable properties or acceptable third party
guarantee in case of advances above Rs. 25000/-.
Term Loan
Loans up to Rs.50000/- 48 months
Loans beyond Rs.50000/- 60 months
Working Capital loans are renewable every year.
Payments will be made direct to the suppliers/ dealers. In case of
construction of the premises, the loan may be disbursed in phases after
verifying the end use in terms of the plan as also at the spot.

The Scheme aims at providing financial assistance to deserving / meritorious students

pursuing higher education in India or abroad. viz., Graduation courses B.A., B.Com., B.Sc.,
etc., Post-Graduation courses, Masters & Ph.D; Professional courses, Engineering, Medical,
Agriculture, Veterinary, Law, Dental, Management, Computer etc., Computer Certificate
courses of reputed Institutes accredited to Department of Electronics or institutes affiliated to
University; Courses like ICWA, C.A., CFA, etc., courses conducted by IIM, IIT, IISc, XLRI,
NIFT, etc., Regular Diploma/Degree courses conducted by Colleges/Universities approved by
UGC/Govt./AICTE/AIBMS/ICMR, Regular Degree / Diploma courses like Aeronautical,
Pilot training, Shippling etc. approved by DGCA/ etc., Courses offered by National Institutes
and other reputed Private Institutes.
Students

should

approach

the

branch

nearest

to

the

place

of

domicile.

Interest is charged monthly on simple basis during the repayment holiday/moratorium period
& concession of 1% in rate of interest is allowed provided the same is serviced regularly
33

during study period. Punjab National Bank has tied up with Kotak Mahindra Insurance to
provide life insurance cover for Student borrowers.
Need based finance, subject to repaying capacity of the parents / students with margin and the
following ceilings :For studies in India: Maximum Rs.10.00 lacs.
For studies abroad: Maximum Rs.20.00 lacs.
Nil.
Above Rs.4.00 lacs:

Studies in India
Studies Abroad
Reimbursement of related expenses such as admission fee, monthly fee,

5%
15%

Boarding and lodging expenses in recognized Boarding Houses etc. already

incurred by way of loan taken from own sources (to meet the contingency)
by the applicant, if claimed within 3 (three) months of such payment and
before consideration of the loan by the Bank.
Second time Education Loan can be sanctioned to the same student
borrower for completion of next higher course
.
Loan against Mortgage

Scheme seeks to provide finance against mortgage of immovable property situated in Metro/
Urban/ Semi Urban centres. The scheme is designed to offer instant solutions relating to
business needs or for personal needs such as, children's higher education, travel, daughter's
marriage, medical emergencies, etc. Loan is, however, not available for speculative purpose.
Eligibility

Employees of Central/ State Govt/ Schools/ Colleges/ Public Sector Undertakings

(PSUs), Reputed Corporates and other intcome tax assesses who are below the age of
60 years

Business Enterprises having a satisfactory track record of

o

3 years of cash profit; and

34

Net profit in the immediately preceding financial year

For Individuals

Minimum net monthly salary/ net annual income of Rs.10,000/ Rs.1,20,000/- for
salaried and for other income tax assesses respectively

Net annual income should be double that of total EMIs for the year

For Business Enterprises

Minimum net annual income/ profit of Rs.1,20,000/-

Net income/ profit should be 1.5 times that of total EMIs for the year

Term Loan & Overdraft

Minimum Loan:- Rs. 1 Lac
Maximum Loan:- Rs.100 Lacs
. OBJECTIVE
Offers attractive benefits as part of a Package to those customers who have the capacity and
are willing to avail a minimum specified loan amount under at least two or more specified
Retail Loan Schemes.
2. SCHEME APPLICABILITY
Authorised Branches.
3. ELIGIBILITY
Individuals, including joint owners, who are willing to avail a minimum loan of Rs.5.00 lac
as a package under at least two specified Retail Loan Schemes at a time. One of which
necessarily be for HOUSING and the other may be any one of the following purposes:
35

Car,
Personal

or

Education. At the same time, such individuals/ including joint owners should have adequate
capacity to regularly service such loans.
4. PURPOSE
Finance will be allowed for:
Meeting

need

based

requirement

of

purchase

construction

/addition

repair/alteration/renovation/furnishing of House/Flat. Loans are also available for purchase of

land/plot for House Building.
Loan on pari passu or second charge basis only to confirmed employees of Central/ State
Government / Public Sector Undertakings (PSUs) maximum upto Rs. 20 lacs. The quantum
of loan be decided taking into account the amount of earlier loan availed and repaying
capacity of the borrower.
Purchase of New Car.
Meeting urgent requirements of personal nature, such as marriage of children, holiday,
foreign travel, family function, medical expenses etc. However, loan will not be granted for
speculation purposes.Education for Self or Children, including the school education of the
child.
5. AMOUNT OF LOAN
For Housing: Need Based - Minimum Rs.2 lac.
Maximum Rs. 50 lacs
For Car : Need Based - Minimum Rs.2 lac.
For Personal Needs: Need Based - Minimum Rs.1 lac Maximum Rs. 2 lacs
For Education: For Studies in India - Minimum Rs.1 lac Max. Rs.5.00 lac
For Studies abroad - Minimum Rs.1 lac Max. Rs.10.00 lac
36

6. MARGIN
10% except when loan is availed for Personal and or Educational needs in which case it shall
be Nil.

7. RATE OF INTEREST
Housing TENOR
For

loans

repayable

Rate of Interest @percent p.a.

REVISED w.e.f. 01.08.2003

in/upto
i) Upto 5 years

7.75

ii) Above 5 & upto 10 years

8.25

Car - PTLR presently 11.50%

Personal - 13%
Education - 50 basis points below PTLR viz.11%
8. REPAYMENT
Housing - Maximum 10 years (120 months) in equal Monthly Instalments.
For Car and Personal - Maximum 4 years (48 months) in equal Monthly Instalments.
For Education - Maximum 7 years (84 months) in equal Monthly Instalments.
Obtention of advance cheques (P.D.Cs) signed by the borrowers be ensured towards
repayment of equated monthly instalments alongwith letter of deposit. In case of Housing and
Education Loans minimum 24 advance cheques be obtained at a time. In case of loan of other
purposes cheque for complete repayment period be taken.
No moratorium period for repayment will be allowed and repayment to commence
immediately.
37

9. MODE OF DISBURSEMENT
As per extant guidelines of specific schemes viz. Housing, Car, Personal and Education.
However, No charges for issue of Demand Draft /Bankers cheques are to be levied.
10. INSURANCE
Comprehensive Insurance Policy to be obtained where loan is allowed for Housing and Car
needs.
11. SECURITY:
Housing
Equitable/ Registered Mortgage of the House/Flat/ Plot Financed.
Obtention of pari passu or second charge over the property mortgaged in favour of other
Lender in situations where senior authorities consider requests and allow loan only to
confirmed employees of Central / State Govts. / Public Sector Undertakings, who have raised
funds for construction / acquisition of accommodation from other sources and need
supplementary finance, for an amount of loan of maximum upto Rs. 20 lacs, which, however,
should be for a minimum of Rs. 2lacs as prescribed above.
Car
Hypothecation of the Vehicle financed.
Equitable mortgage should be for the total amount of loan.
12. GUARANTEE
Suitable guarantee acceptable to the Bank may be obtained which may also include guarantee
from family members/other relatives.
13. UPFRONT & DOCUMENTATION CHARGES
Flat Upfront charges of Rs.2,500/- & no documentation charge.
38

14. PREPAYMENT PENALTY

In case any of the loan facilities allowed are adjusted within a period of three years,
borrower(s) will be required to pay a prepayment Penalty @ 2% on the amount which had not
become due for payment.
15. GENERAL
The concessional loan facility is available provided the combined availment is Rs. 5 lacs or
more.
Equitable Mortgage of the Immovable Property against which Housing loan has been allowed
will secure the combined loan for two or more purposes.
Equitable Mortgage shall not to be released till final adjustment of all the loans.
Indian Retail Banking continues to redefine the credit growth in the country. It grew by a
whopping 44.4% in 2005-06 to touch Rs3,538 billion. This leap was despite the increase in
risk weight by RBI for housing and real estate loans during August, 2005. Housing, which
constitutes more than 52% of all retail loans, grew at a robust rate of 44.35% during 2005-06.
In order to help banks in India to understand the market and competition and plan future
strategies, we have just come out with an Industry Insight on Indian Retail banking 2006
edition. This report analyses the retail banking market and its segments in India and presents
the key trends, along with issues and challenges. The report also paints a future outlook for
the market. Besides it profiles 21 major players in the retail banking space and their
strategies.
This report will be of immense use to all banks in India to review and formulate their
strategies in the retail space. It primarily covers analysis of the present status, current trends,
major
Major

issues

&
points

challenges

in

the

growth

discussed

in

of

the
this

retail

banking
report

sector.
are:

-Global retail banking vis--vis Indian scenario

-Indian retail banking overview
39

-What

are

the

regulatory

factors

involved

in

Indian

banking

industry?

- How interest rate risks, money laundering, and outsourcing are affecting the performance
of banking sector?
- What would be the impact of Basel-II norms in Indian banking industry?
- How the banking industry would combat the competition from upcoming sectors like
mutual

funds?

- What are the various issues and challenges before this industry?
With a jump in the Indian economy from a manufacturing sector, that never really took off, to
a nascent service sector, Banking as a whole is undergoing a change. A larger option for the
consumer is getting translated into a larger demand for financial products and customisation
of services is fast becoming the norm than a competitive advantage.
With the Retail banking sector expected to grow at a rate of 30% [Chanda Kochhar, ED,
ICICI Bank] players are focussing more and more on the Retail and are waking up to the
potential of this sector of banking. At the same time, the banking sector as a whole is seeing
structural changes in regulatory frameworks and securitisation and stringent NPA norms
expected to be in place by 2004 means the faster one adapts to these changing dynamics, the
faster is one expected to gain the advantage. In this article, we try to study the reasons behind
the euphemism regarding the Retail-focus of the Indian banks and try to assess how much of
it is worth the attention that it is attracting.
Potential for Retail in India: Is sky the limit?
The Indian players are bullish on the Retail business and this is not totally unfounded. There
are two main reasons behind this. Firstly, it is now undeniable that the face of the Indian
consumer is changing. This is reflected in a change in the urban household income pattern.
The direct fallout of such a change will be the consumption patterns and hence the banking
habits of Indians, which will now be skewed towards Retail products. At the same time, India
compares pretty poorly with the other economies of the world that are now becoming
comparable in terms of spending patterns with the opening up of our economy. For instance,
while the total outstanding Retail loans in Taiwan is around 41% of GDP, the figure in India
stands at less than 5%. The comparison with the West is even more staggering. Another
comparison that is natural when comparing Retail sectors is the use of credit cards. Here also,
the potential lies in the fact that of all the consumer expenditure in India in 2001, less than
1% was through plastic, the corresponding US figure standing at 18%.
40

But how competitive are the players?

The fact that the statistics reveal a huge potential also brings with it a threat that is true for
any sector of a country that is opening up. Just how competitive are our banks? Is the threat
of getting drubbed by foreign competition real? To analyze this, one needs to get into the
shoes of the foreign banks. In other words, how do they see us? Are we good takeover
targets? Going by international standards, a large portion of the Indian population is simply
not bankable
taking profitability into consideration. On the other hand, the financial services market is
highly over-leveraged in India. Competition is fierce, particularly from local private banks
such as HDFC and ICICI, in the business of home, car and consumer loans. There, precisely
lie the pitfalls of such explosive growth. All banks are targeting the fluffiest segment i.e. the
upwardly mobile urban salaried class. Although the players are spreading their operations
into segments like selfemployed and the semi-urban rich, it is an open secret that the big city
Indian yuppies form the most profitable segment. Over-dependence on this segment is bound
to bring in inflexibility in the business.

What about the foreign giants?

The foreign banks have identified this problem but there are certain systematic risks involved
in operating in the Retail market for them. These include regulatory restrictions that prevent
them from expanding their branch network. So these banks often take the Direct Selling
Agent (DSA) route whereby low-end jobs like sourcing or transaction processing are
outsourced to small regional layers. So now on, when you see a loan mela or a road show
showcasing the retail bouquet of an elite MNC giant, you know that a significant commission
earned out of any such booking gets ploughed back to our own economy. Perhaps, one of the
biggest impediments in foreign players leveraging the Indian markets is the absence of
positive credit bureaus. In the west the risk profile can be easily mapped to things like SSNs
and this information can be publicly traded. PAN is a step in this direction but lot more work
need to be done. What has been a positive step towards this is a negative file sharing started
by a consortium of 11 banks. However, as a McKinsey study points out actual write-offs on
NPAs show a strong negative correlation with sharing of positive information. On top of this,
the spend-now-pay-later credit culture in India is just not picking up. A swift legal
41

procedure against consumers creating bad debt is virtually nonexistent. Finally, the vast
geographical and cultural diversity of the country makes credit policy formulation a tough job
and it simply cannot be dictated from a Wall Street or a Singapore boardroom! All these add
up to the unattractiveness of the Indian retail market to the foreign players. So over the past
few years, in spite of the entry of MNCs in many industries, Retail Banking has seen a flurry
of panicky exits. Fewer than 40 remain in India and their share of total bank assets currently
7.2% is falling. Those that remain might be thought to be likely buyers of Indian banks. Yet
Citibank, HSBC and Standard Charteredall in India for more than a century, and with
relatively large retail networksseem to have no pressing need to acquire a local bank.
Established foreign banks have preferred to take over customers or businesses from other
foreign banks that want to leave. Thus HSBC, in recent years, has acquired customers from
France's BNP, Germany's Deutsche Bank and Japan's Bank of Tokyo-Mitsubishi. ABN Amro
took over Bank of America's retail business.
So all for the keeping then?
This will perhaps be the most wrongful inference that can be drawn from the above. We just
cannot afford to look inwards and repeat the mistakes that were the side effects of the
Nationalization of the Banking System. A growing market can never be an alibi for lack of
innovation. Indian banks have shown little or no interest in innovative tailor-made
products.They have often tried to copy process designs that have been tested, albeit
successfully, in the West. Each economic culture has its own traits and one who successfully
adapts those to the business is the eventual winner. A case in point is the successful
implementation of micro-credit networks in Bangladesh. Positioning a bank as a tech-savvy
financial vendor in a country where Internet penetration is an abysmal 1.65% can only add to
the over-leveraging as pointed out earlier. The focus of the sector should remain in
macroeconomic wealth creation and not increasing the per capita indebtedness that will do
little but add to the NPA burden. Retail Banking in India has to be developed in the Indian
way, notwithstanding the long queues in front of the teller counter in the SBI Joka branch!
Awards

42

Awards & Achievements of Punjab National Bank in

Recent Times

AWARDS WON DURING THE YEAR 2013-14

* MSME Banking Excellance Award 2014

* PNB bags RBI Rajbhasha Award 2014
* Annual Social Banking Excellence Award 2014

* Golden Peacock Business Excellence Award 2014 by Institute of Directors

* PNB RECEIVED AWARD FOR CSR ACTIVITY 2014

* PNB bags Golden Peacock award for innovative Product/Service

for the year 2014
* Vigilance Excellence Award 2013-14
* ABP News presented PNB withGlobal CSR Excellence and
Leadership Award for Organisations with Best CSR Practices
on 17.02.2014
* Punjab National Bank conferred with Appreciation Certificate in
6th Global CSR Summit - cum Excellence Awards

AWARDS WON DURING THE YEAR 2012-13

AWARDS WON DURING THE YEAR 2011-12
43

AWARDS WON DURING THE YEAR 2010-11

AWARDS WON DURING THE YEAR 2009-10

44

45

Balance Sheet of Punjab

National Bank
Mar

------------------- in Rs. Cr. ------------------Mar '13

Mar '12

Mar '11

Mar '10

12 mths

12 mths

12 mths

12 mths

0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
Mar

353.47
353.47
0.00
0.00
32,323.43
32,676.90
391,560.06
39,620.92
431,180.98
15,019.15
478,877.03
Mar '13

339.18
339.18
0.00
0.00
27,477.89
27,817.07
379,588.48
37,264.27
416,852.75
13,524.18
458,194.00
Mar '12

316.81
316.81
0.00
0.00
21,191.75
21,508.56
312,898.73
31,589.69
344,488.42
12,328.27
378,325.25
Mar '11

315.30
315.30
0.00
0.00
15,915.63
16,230.93
249,329.80
19,262.37
268,592.17
10,317.69
295,140.79
Mar '10

'14
12

12 mths

12 mths

12 mths

12 mths

'14
12
mths
Capital and Liabilities:
Total Share Capital
Equity Share Capital
Share Application Money
Preference Share Capital
Reserves
Net Worth
Deposits
Borrowings
Total Debt
Other Liabilities & Provisions
Total Liabilities

mths
Assets
Cash & Balances with RBI
Balance with Banks, Money at

0.00
0.00

17,886.25
9,249.13

18,492.90
10,335.14

23,776.90
5,914.32

18,327.58
5,145.99

Call
Advances
Investments
Gross Block
Revaluation Reserves
Accumulated Depreciation
Net Block
Capital Work In Progress
Other Assets
Total Assets
Contingent Liabilities
Bills for collection
Book Value (Rs)

0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00

308,725.21
129,896.19
3,357.68
0.00
0.00
3,357.68
0.00
9,762.58
478,877.04
231,810.55
0.00
924.45

293,774.76
122,629.47
3,168.86
0.00
0.00
3,168.86
0.00
9,792.88
458,194.01
224,750.05
0.00
820.13

242,106.67
95,162.35
3,105.60
0.00
0.00
3,105.60
0.00
8,259.42
378,325.26
138,915.26
0.00
678.91

186,601.21
77,724.47
4,215.21
1,491.99
1,701.74
1,021.48
0.00
6,320.07
295,140.80
68,124.47
33,215.78
514.77

46

47

------------------- in Rs. Cr. -------------------

Profit & Loss account of

Punjab National Bank
Mar

Mar '13

Mar '12

Mar '11

Mar '10

12 mths

12 mths

12 mths

12 mths

0.00
0.00
0.00

41,893.33
4,215.92
46,109.25

36,428.03
4,202.60
40,630.63

26,986.48
3,612.58
30,599.06

21,466.91
3,565.31
25,032.22

0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
Mar

27,036.82
5,674.72
8,331.53
318.50
0.00
8,165.05
6,159.70
41,361.57
Mar '13

23,013.59
4,723.48
7,717.10
292.26
0.00
7,002.75
5,730.09
35,746.43
Mar '12

15,179.14
4,461.10
6,269.47
255.85
0.00
6,364.22
4,622.20
26,165.56
Mar '11

12,944.02
3,121.14
4,838.88
222.83
0.00
5,761.36
2,421.49
21,126.87
Mar '10

'14
12

12 mths

12 mths

12 mths

12 mths

mths
0.00
0.00
0.00
0.00
0.00
0.00
0.00

4,747.67
0.00
0.00
4,747.67
0.00
954.38
162.20

4,884.20
0.00
0.00
4,884.20
0.00
746.19
121.05

4,433.50
0.00
0.00
4,433.50
0.00
696.99
113.07

3,905.36
0.00
7.64
3,913.00
0.00
693.67
116.43

0.00
0.00
0.00

134.31
270.00
924.45

144.00
220.00
820.13

139.94
220.00
678.91

123.86
220.00
514.77

0.00
0.00
0.00

3,631.10
-0.01
1,116.58

4,016.96
0.00
867.24

3,623.44
0.00
810.06

1,532.46
1,570.44
810.10

0.00
0.00

0.00
4,747.67

0.00
4,884.20

0.00
4,433.50

0.00
3,913.00

'14
12
mths
Income
Interest Earned
Other Income
Total Income
Expenditure
Interest expended
Employee Cost
Selling, Admin & Misc Expenses
Depreciation
Preoperative Exp Capitalised
Operating Expenses
Provisions & Contingencies
Total Expenses

Net Profit for the Year

Extraordinary Items
Profit brought forward
Total
Preference Dividend
Equity Dividend
Corporate Dividend Tax
Per share data (annualised)
Earning Per Share (Rs)
Equity Dividend (%)
Book Value (Rs)
Appropriations
Transfer to Statutory Reserves
Transfer to Other Reserves
Proposed Dividend/Transfer to
Govt
Balance c/f to Balance Sheet
Total

48