annual report - banking codes and standards board of india report/ar11-12.pdfbanking codes and...

Annual Report2011-12

BANKING CODES AND STANDARDSBOARD OF INDIA

www.bcsbi.org.in

PUBLISHED BY

Narayanan RajaChief Executive OfficerBanking Codes and Standards Board of IndiaC-7, Reserve Bank of India BuildingBandra Kurla ComplexMumbai- 400051

Banking Codes and Standards Board of India

Governing Council

Chairman

A C Mahajan

Members

Narayanan Raja Chief Executive Officer


M M Chitale C Krishnan

H N Sinor Rama Bijapurkar

ANNUAL REPORT OF THE BANKING CODES AND STANDARDS BOARD OF INDIA (BCSBI)

2011-12

The objective of setting up the Banking Codes and Standards Board of India (BCSBI) as an independent and autonomous body to ensure fair treatment to customers will be achieved only when the provisions of the Codes are adhered to in letter and spirit by member banks. BCSBI continued to spread awareness of the organisation and the Codes among the public by carrying out publicity campaigns through TV, Radio and posters on bus panels. In addition, BCSBI officials addressed gatherings of customers and bankers in town hall meetings, outreach programmes of Banking Ombudsmen, seminars of Micro and Small Enterprises (MSE) and MSE Trade and Industry Associations. These initiatives were in addition to the normal activities of monitoring compliance of the Codes and dealing with systemic issues noticed in specific member banks. Findings of the branch visits and interactions with frontline staff of banks clearly point to the need for concerted efforts by member banks to educate and sensitize staff members about the provisions of the Codes and also spread awareness among their customers about their rights.

Governing Council

The last meeting of the previous Governing Council was held on December 14, 2011. Smt K J Udeshi, the outgoing Chairman placed on record the contribution of Members of the Governing Council over the years in evolving the Codes and their suggestions on spreading awareness of provisions of the Codes both among member banks and customers which has brought about improvement in customer service in the banking sector. The Governing Council Members also expressed appreciation for the signal role played by the outgoing Chairman, Smt K J Udeshi, in founding of BCSBI and nurturing it to its present state. They noted that BCSBI under her stewardship has helped improve customer service by bringing about transparency and fair practices in banks.

On expiry of the term of the First Governing Council, it was reconstituted on December 14, 2011 in terms of Rule 7 (1) of Rules and Regulations of BCSBI. The Members of the newly constituted Governing Council are:

Nominated by RBI in terms of Rule 7 (2) (i) ibid:1) Shri M M Chitale2) Shri C Krishnan3) Smt Rama Bijapurkar

Nominated by the member banks in consultation with the Reserve Bank in terms of Rule 7 (2) (ii) ibid.4) Shri A C Mahajan5) Shri H N Sinor

Annual Report 2011-12Banking Codes and Standards Board of India

The newly constituted Governing Council elected Shri A C Mahajan as Chairman of the Banking Codes and Standards Board of India. Shri N Raja has been appointed as Chief Executive Officer and ex-officio Member of the Governing Council with effect from June 2, 2011 vice Shri B M Mittal who relinquished his position on the expiry of the term of his appointment on February 17, 2011. The Governing Council, which is vested with the general supervision, direction and control of the working of the BCSBI, held eleven meetings during the year 2011-12.

MembershipDuring the year, one scheduled commercial bank and five Regional Rural Banks (RRBs) were admitted as members, taking the total number of members to 115 as at the end of March 2012 (SBI Commercial and International Bank ceased to be a member owing to its merger with State Bank of India). BCSBI will continue its efforts to enlist eligible banks as members so that all bank customers benefit from the fair practice codes. Names of member banks are listed in Annex I.

Survey of branches to assess implementation of the CodesCompliance with the provisions of the Codes is a continuous process and as part of our monitoring, apart from obtaining an Annual Statement of Compliance (ASC) from banks, we also conduct periodical visits to select branches of banks to examine implementation of the provisions of the Codes at the grassroot level. Bank-wise findings are analysed and compared with the self certifications contained in Annual Statement of Compliance (ASC). Inconsistencies, if any, and other observations are taken up with the banks concerned. In select cases, the Top Management of the concerned banks are also invited for a meeting with the Governing Council and/or CEO for discussion on the bank’s action plan to improve adherence to the provisions of the Codes.

During the current year, our personnel / authorized representatives visited 2000 branches, selected at random, of 40 member banks, which is twice the number of branches visited in the previous year. In addition, 83 hubs / processing centres, attending to retail and MSE loans, were also visited for the purpose. These branches and hubs were located in 47 cities spread over different parts of India. The survey findings are being shared with the concerned banks as in the past so that effective measures to improve adherence to the Codes can be taken by the banks. Salient findings of the visits are attached (Annex II).

Resolution of Systemic IssuesMember banks have their own grievance redressal machinery to deal with complaints from customers. Where the complaints are not redressed or not resolved to their satisfaction, the customers have recourse to the machinery of Banking Ombudsmen. BCSBI also receives complaints from customers. However, such complaints, as also Awards issued by Banking Ombudsmen and decisions of the Appellate Authority under Banking Ombudsman Scheme,


2


3

are studied to find out whether there is any breach of provisions of the Codes or an underlying systemic issue which gave rise to the complaints. Complaints received during the year, grouped nature-wise, are given in Annex III.

A few systemic issues identified during the year under review relate to the bank concerned revamping the procedure followed in handling cheques deposited in cheque drop box for collection, encouraging customers to register for SMS facility to get instantaneous message alerts covering transactions in accounts as a measure of fraud prevention / containment in ATM withdrawals, formulating a policy to compensate customers for wrongful deduction of tax at source despite submission of Form 15G/H by customers due to delay in uploading the tax exemption status, acceptance of cheques from customers of non-home branches for collection, implementation of One Time Pass Word for fund transfer, restriction on number of transactions to five per day, instantaneous SMS alert for all transactions, 24x7 monitoring of sites for phishing Malware and Trojans, etc. for making internet transactions safe.

Code of Bank’s Commitment to Micro and Small EnterprisesThe Code of Bank’s Commitment to Micro and Small Enterprises (MSE Code), came into effect in May 2008 and is, therefore, due for review. The review is under way in collaboration with the Indian Banks’ Association (IBA). A Working Group, headed by CEO, comprising of representatives from RBI, IBA and some member banks has been constituted to take the review process forward.

The objective of the review is to bring about an enhancement in the minimum standards of banking practices / services relating to MSEs, keeping in view the regulatory framework, growing expectations, market developments and the imperative need to support the sector which plays a very important role in the economy. During the process of review, suggestions were invited from Reserve Bank of India, member banks and industry associations. Suggestions were also invited from members of the public through a notice on the BCSBI website. Interactions have also been had with members of industry associations and trade bodies to get their views in the matter.

The Working Group has suggested several improvements to the MSE Code. Suggestions received from various sources were also examined by the Working Group for inclusion in the MSE Code. The draft of the revised MSE Code has since been forwarded to the Reserve Bank of India as also the Indian Banks’ Association for their views and suggestions.

Financial Inclusion – Incorporation into CodesAccess to formal banking services and bank finance by the hitherto excluded segment of the population is a prerequisite for equitable economic development. As vast majority of population in the rural, semi-urban and urban areas of the country as also migrant labour have serious issues in accessing services from the banking channel, a chapter on ‘Financial Inclusion’ is proposed to be included in the Code of Bank’s Commitment to Customers. Work on this has been undertaken by BCSBI.


4

At the conference of Principal Code Compliance Officers of member banks – (L to R) Shri N Raja, Shri M M Chitale, Shri A C Mahajan, Dr. K C Chakrabarty, Deputy Governor, RBI, Shri C Krishnan, Shri H N Sinor

Dr. K C Chakrabarty, Deputy Governor, RBI addressing the participants at the conference of Principal Code Compliance Officers of member banks


5

A section of the participants at the conference of Principal Code Compliance Officers

At the conference of Principal Code Compliance Officers of member Regional Rural Banks and Urban Co-operative Banks


6

A section of the participants at the conference of Principal Code Compliance Officers of member Regional Rural Banks and Urban Co-operative Banks

At the Town Hall Meeting organized by ICICI Bank in association with RBI - Shri N Raja, CEO, BCSBI (second from right) interacting with the participants


Shri A C Mahajan, Chairman, BCSBI addressing the participants at the seminar at New Delhi

Shri A C Mahajan addressing the participants at the seminar on ’Customer Service’ organized by the Indian Institute of Banking and Finance at Ahmedabad

7


Shri N Raja, CEO (second from right) at the seminar on ‘Customer Service’ organized by the Indian Institute of Banking and Finance at Chennai

Shri N Raja, CEO handing over surplus computers to the Zilla Parishad Prathamik Shala, Satara

8


BCSBI at a glance

2010-11 2011-12

Members of BCSBI 110 115

Banks admitted as members during the year 20 6

Applications in process for membership 16 16

Workshops / Conferences / seminars held / participated in 4 12

Town Hall Meetings participated in -- 3

Participation in Customer Awareness Programmes 3 12

SLBCs addressed 23 2

Branches / processing centres visited to assess Code implementation 1135 2083

Credit Counselling cases handled 283 212

Complaints received and dealt with 573 484

Meeting of the Deputy Governor with the Governing CouncilDr. K C Chakrabarty, Deputy Governor, Reserve Bank of India met the newly constituted Governing Council to share his expectations with them. Dr. Chakrabarty emphasized the need to enhance customer service in banks. Some of the key issues highlighted by the Deputy Governor at the meeting, that he felt needed to be addressed, were promotion of safe and secure electronic banking, non-obtention of one sided agreements by banks which may not provide protection to the customer, need to refrain from levying unreasonable charges for products and services, increased transparency, inclusion of lender’s liability in the Codes, selling of inappropriate products by banks, etc. The Deputy Governor mentioned that BCSBI could play an important role in promoting customer service by ensuring that fair and ethical practices are adopted by the banking industry when serving their customers.

BCSBI has since taken up the issues raised by the Deputy Governor with a view to ensure fair treatment of consumers of banking services.

Conference of Principal Code Compliance OfficersTo facilitate sharing of views and issues amongst member banks and BCSBI, a Conference of Principal Code Compliance Officers (PCCOs) of scheduled commercial banks was organized in February 2012. The Conference was inaugurated by Dr. K C Chakrabarty, Deputy Governor, Reserve Bank of India. Dr. Chakrabarty, in his keynote address shared his views and concerns regarding the quality of customer care and service in the banking industry. He emphasised the importance of extending protection to the consumer of banking services by adopting fair and non-discriminatory practices when dealing with customers. The Chairman, BCSBI and Members of Governing Council present at the Conference interacted with the participants. Several issues raised during the discussions were debated and clarified. The issues raised

9


10

by PCCOs along with BCSBI’s comments have been placed on the BCSBI website for the guidance of all concerned.

A separate Conference of PCCOs of member Regional Rural Banks (RRBs) and Urban Co-operative Banks (UCBs) was held in March 2012 for sharing views on Code implementation and discussing issues which are of particular relevance to RRBs and UCBs.

Spreading Awareness of the Codes

BCSBI has taken several measures to increase awareness of bank officials, their staff and customers about the provisions of the Codes so that these are implemented in true spirit. It has participated in the Town Hall meetings organised by RBI and propagated the role of BCSBI and rights of customers contained in the Codes. Apart from these, BCSBI officials have also addressed meetings of State Level Bankers’ Committee of West Bengal and Jammu & Kashmir in June and September 2011 respectively to highlight how banks can contribute to the growth of MSEs through proper implementation of the MSE Code. BCSBI officials have also participated in the outreach programmes organized by Banking Ombudsmen at six centres and other on-location workshops and seminars.

BCSBI has also stressed upon member banks the pro-active role the banks’ training system can play in spreading awareness of the Codes and the willingness of BCSBI to assist in conducting programmes by making available presentation material and faculty support when requested. BCSBI officials also participated in the seminars / meetings organized by Industry Associations / Trade bodies of Micro and Small Enterprises at Kolkata, Mumbai, Delhi and Bengaluru.

As part of the campaign to increase awareness about the Codes, TV Ad on Doordarshan’s National News and certain regional channels and broadcast of radio jingle on the Vividh Bharati network of All India Radio were continued for two more quarters of April-June 2011 and October-December 2011. Posters in Marathi were also displayed on 400 buses of Maharashtra State Roadways Transport Corporation in 27 cities of Maharashtra State for two months.

Visits by Delegations from Abroad

A delegation from IMF-World Bank Financial Stability Assessment Programme (FSAP) Mission visited BCSBI in October 2011 to discuss matters relating to protection available to consumers of financial products in the country. The delegation was briefed about the role of BCSBI, important provisions of the Codes including key commitments of banks, grievance redressal mechanism, etc.

A delegation of senior officials from Bangladesh Bank also visited BCSBI in February 2012 to familiarize themselves about banking consumer protection system in vogue in India and BCSBI’s role.


Publication of BCSBI Newsletter – ‘Customer Matters’The newsletter ‘Customer Matters’ launched in April, 2009, continues to highlight contemporary banking issues and practices; initiatives by RBI in the field of customer service and exemplary decisions taken under the Banking Ombudsman Scheme and various Consumer Fora. All issues of our newsletter are available on our website www.bcsbi.org.in A soft copy of each issue is being forwarded to member banks to be placed on their intranet for easy access by all members of staff.

Funds PositionAs per the funding arrangement agreed with Reserve Bank of India upto 2015-16, BCSBI would be utilizing its entire interest income towards meeting its expenditure and RBI has agreed to fund the expenditure gap. Accordingly, during the year, BCSBI has expended an amount of ` 104.36 lakh out of its interest income. Unspent interest income amounting to ` 48.84 lakh has been transferred to the Public Awareness Fund to be spent for the purpose during the next five years. Entire contribution made by the member banks in the form of registration fees and membership fees has been credited to the Corpus as desired by them.

As on March 31, 2012, there is an aggregate amount of ` 1690.31 lakh in the Corpus Fund and Public Awareness Fund. These funds have been invested in Government Securities ( ` 358.35 lakh) and term deposits with member banks ( ` 1331.96 lakh) in accordance with the approved Investment Policy.

Way AheadA separate cell has been created in BCSBI to do research on global best practices on fair treatment of banking customers. It is proposed to undertake studies on practices adopted by banks in the field of levy of charges, selling of products appropriate to customers, safe and secure banking through electronic platforms and lender’s liability towards small borrowers on an on-going basis. While doing so, best practices both in India and abroad will be studied as also the consumer protection available elsewhere. BCSBI will also undertake branch visits / mystery shopping on select themes of customer interest based on Code provisions.

Recognising the need to spread awareness of the Codes amongst staff of banks and customers, BCSBI will make increased efforts towards this end. BCSBI will participate in customer meets organized by member banks as also training programmes arranged for members of staff.

AcknowledgementsBCSBI is thankful to Reserve Bank of India for their continued financial support and for providing us with opportunity to participate in Town Hall Meetings and Awareness Programmes of Banking Ombudsmen. BCSBI also wishes to thank IBA and all member banks for their support and cooperation.

BCSBI wishes to place on record sincere thanks and appreciation to the members of the erstwhile Governing Council for their able guidance and valuable contributions to the BCSBI cause. Special thanks are due to Smt K J Udeshi, former Chairman for the role that she played in creating BCSBI and nurturing it during its formative years.

11


12

Sl. No.

Name of the bank

Scheduled Commercial Banks1 AB Bank Ltd.2 Allahabad Bank3 Andhra Bank4 Axis Bank Ltd.5 Bank of America N.A.6 Bank of Baroda7 Bank of Ceylon8 Bank of India9 Bank of Maharashtra10 Bank of Nova Scotia11 Barclays Bank PLC12 BNP Paribas13 Canara Bank14 Central Bank of India15 Citibank N.A .16 City Union Bank Ltd.17 Commonwealth Bank of Australia18 Corporation Bank19 Credit Agricole Corporate and Investment Bank20 DBS Bank Ltd.21 Dena Bank22 Deutsche Bank AG23 Development Credit Bank Ltd.24 ICICI Bank Ltd.25 IDBI Bank Ltd26 Indian Bank27 Indian Overseas Bank28 IndusInd Bank Ltd.29 ING Vysya Bank Ltd.30 JP Morgan Chase Bank N.A.31 Karnataka Bank Ltd.32 Krung Thai Bank PLC33 Kotak Mahindra Bank Ltd.34 Mashreq Bank psc35 Oman International Bank S.A.O.G36 Oriental Bank of Commerce37 Punjab National Bank 38 Shinhan Bank39 Societe Generale40 Sonali Bank

Sl. No

Name of the bank

Scheduled Commercial Banks41 Standard Chartered Bank42 State Bank of Bikaner and Jaipur43 State Bank of Hyderabad44 State Bank of India45 State Bank of Mauritius46 State Bank of Mysore47 State Bank of Patiala48 State Bank of Travancore49 Syndicate Bank50 The Catholic Syrian Bank Ltd.51 The Dhanlaxmi Bank Ltd.52 The Federal Bank Ltd.53 The HDFC Bank Ltd.54 The Hongkong and Shanghai Banking

Corporation Ltd.55 The Jammu & Kashmir Bank Ltd56 The Karur Vysya Bank Ltd.57 The Laxmi Vilas Bank Ltd.58 The Nainital Bank Ltd.59 The Ratnakar Bank Ltd.60 The Royal Bank of Scotland61 The South Indian Bank Ltd62 Tamilnad Mercantile Bank Ltd.63 UCO Bank64 Union Bank65 United Bank66 Vijaya Bank67 Yes Bank Ltd.

Scheduled Urban Co-operative Banks1 Bharat Cooperative Bank (Mumbai) Ltd.2 Citizen Credit Cooperative Bank Ltd.3 Cosmos Co-operative Urban Bank Ltd.4 Karad Urban Co-operative Bank Ltd.5 Nagar Urban Co-operative Bank Ltd.6 Nagpur Nagrik Sahakari Bank Ltd.7 Nutan Nagrik Sahakari Bank Ltd.8 Punjab and Maharashtra Co-operative

Bank Ltd.9 Saraswat Co-operative Bank Ltd.10 Shamrao Vittal Cooperative Bank Ltd.11 Thane Bharat Sahakari Bank Ltd.

Annex IBCSBI members


13

Annex IBCSBI members (Contd.)

Sl. No.

Name of the bank

Regional Rural Banks1 Allahabad UP Gramin Bank2 Andhra Pragathi Grameena Bank3 Aryavart Gramin Bank 4 Baroda Gujarat Gramin Bank5 Baroda Rajasthan Gramin Bank6 Baroda Uttar Pradesh Gramin Bank7 Chaitanya Godavari Grameena Bank8 Deccan Grameena Bank9 Hadoti Kshetriya Gramin Bank10 Haryana Gramin Bank11 Himachal Gramin Bank 12 Jaipur Thar Gramin Bank13 Jammu & Kashmir Gramin Bank14 Jhabua- Dhar Kshetriya Gramin Bank15 Karnataka Vikas Grameena Bank16 Kashi Gomti Samyut Gramin Bank17 Krishna Grameena Bank18 Madhya Bharat Gramin Bank19 Maharahstra Gramin Bank

Sl. No.

Name of the bank

Regional Rural Banks20 Meghalaya Rural Bank21 Nainital-Almora Kshetriya Gramin Bank22 Pallavan Grama Bank23 Pandyan Grama Bank24 Prathama Bank25 Puduvai Bharathiar Grama Bank 26 Purvanchal Gramin Bank27 Rajasthan Gramin Bank28 Rewa Sidhi Gramin Bank29 Rushikulya Gramya Bank30 Saptgiri Grameena Bank31 Saurashtra Gramin Bank32 Sarva UP Gramin Bank33 Sharda Gramin Bank34 Shreyas Gramin Bank35 Surguja Kshetriya Gramin Bank 36 Uttar Bihar Gramin Bank

37 Wainganga Krishna Gramin Bank


14

Annex IIFindings of the Survey of branches conducted during December 2011-February 2012 to as-sess the level of compliance with the Codes of Bank’s Commitment to Customers and MSEs

Select findings of SurveyPercentage of Branches responding

“YES”

In cognito verificationDoes the branch exchange soiled notes?Does the branch start operations at the appointed time?Whether all customers who enter the branch before the close of business hours are attended to?

829499

Through verification / interaction with branch officials

Display of information about availability of nomination facility in deposit accounts

72

Availability of Folder / Booklet containing detailed information 54

Display of name and address of the Regional / Zonal Manager whom the customer may approach if his grievance is not redressed at the branch

75

Time norms for common transactions 74

Whether the charges applicable to the deposit products are explained? 96

Whether Form 15 G / H obtained from customers exempt from TDS on FD Interest

94

Intimating the customer before an account is classified as inoperative 27

Recording fact of nomination in pass book 73

Providing address of the branch in the passbook 92

Display of cut-off time for deposit of cheques in drop box for same day clearing 47

Whether the branch records complaints received? 73

Whether the complaints are redressed within 30 days? 84

Whether the loan sanction letter contains all terms and conditions? 95

Whether the bank gives written receipt for the documents taken as security / collateral?

61

Lending to MSEs: Whether simplified loan application form is used? 74

Are MSE loan applications disposed of within the prescribed time frame? 88

Whether the loans are generally disbursed within the prescribed days? 87


15

Annex-II (Contd.)


Annex-II (Contd.)

16


17

Annex II (Contd.)City-wise and bank group-wise break up of sample of branches & hubs visited for the survey

Centres Bank Groups City-wise total of

branches / hubs visited

SBI & Associates

Other public sector banks

Private Sector banks

Foreign banks

Mumbai 40 80 64 11 195

Delhi 14 65 52 6 137

Kolkata 31 70 41 7 149

Chennai 33 66 43 7 149

Agartala 5 12 3 - 20

Agra 6 16 8 - 30

Ahmedabad 16 35 30 4 85

Amritsar 8 14 7 - 29

Aurangabad 4 17 9 - 30

Bengaluru 19 49 36 4 108

Bhopal 8 14 10 - 32

Bhubaneswar 4 20 6 - 30

Chandigarh 13 16 10 1 40

Coimbatore 7 17 6 - 30

Cuttack 6 19 5 - 30

Dehradun 3 8 3 - 14

Faridabad 7 16 7 - 30

Guwahati 4 21 5 - 30

Gurgaon 7 14 9 1 31

Hubli 7 16 7 - 30

Hyderabad 24 36 23 4 87

Indore 5 19 7 - 31

Jabalpur 7 16 6 - 29

Jaipur 10 19 10 1 40

Jalandhar 6 18 6 - 30

Kanpur 7 17 6 - 30

Kochi 9 14 7 - 30

Lucknow 6 15 9 - 30

Ludhiana 11 12 9 - 32

Madurai 8 16 6 - 30

Mangalore 6 17 6 - 29

Mysore 5 17 8 - 30

Nagpur 5 20 5 - 30


Annex II (Contd.) City-wise and bank group-wise break up of sample of branches & hubs visited for the survey

Centres Bank Groups City-wise total of

branches / hubs visited

SBI & Associates

Other public sector banks

Private Sector banks

Foreign banks

Pune 7 27 5 2 41

Raipur 5 11 9 - 25

Rajkot 6 18 6 - 30

Ranchi 5 11 4 - 20

Shillong 4 11 5 - 20

Surat 4 21 5 - 30

Thiruvananthapuram 8 16 8 - 32

Udaipur 8 17 5 - 30

Vadodara 3 21 6 - 30

Vijayawada 9 18 3 - 30

Visakhapatnam 8 19 5 - 32

Total (47 Cities) 428 1061 546 48 2083

Annex IIIProfile of Complaints

Sr. No.

Nature of Complaints 2010-11 2011-12

1 Deposit Accounts 100 112

2 Credit/Debit Cards 133 80

3 Pension - 3

4 Tariff Schedule & Service Charges 31 7

5 Cheque Collection/Clearing Cycle 21 8

6 Foreign Exchange Service 1 1

7 ATM Related 16 3

8 Compensation Policy - -

9 Do-not-call (unsolicited Telemarketing) - -

10 Loans & Advances – Collection of Dues- Security Repossession

111 64

11 Grievance Redressal Mechanism 7 1

12 Miscellaneous 153 205

Total 573 484

18

Statement of Accounts for the year

2011-12


LOONKER & CO. 8-Dhun Mahal, Garden RoadChartered Accountants Colaba, Mumbai 400 039 Tel : 2282 5580; 2285 6740 Mobile: 93246 14750.

20

Auditors’ Report

We have audited the Balance Sheet of Banking Codes and Standards Board of India as at 31st March 2012 and the Income and Expenditure account for the year ended on that date an-nexed thereto. These financial statements are the responsibility of the trustees of the Board. Our responsibility is to express an opinion on these financial statements based on our audit.

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

We report that:

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

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

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

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

- in the case of Balance Sheet of the state of affairs of the above named trust as at 31st March 2012 and

- in the case of Income & Expenditure Account of the trust for the accounting year ended on that date.

For M/s. Loonker & Co Chartered Accountants

Sd./- (S. C. Loonker) Place: Mumbai Partner Date: May 8, 2012 (Membership No.10135)


Notes on Accounts - Schedule A As per our report of even date

Sd/-

(A C Mahajan) M/s.Loonker & Co.

Chairman Chartered Accountants

Sd/- Sd/-

(N Raja) Partner

Chief Executive Officer Auditors


Place: Mumbai Place: Mumbai

Date: May 8, 2012 Date: May 8, 2012

BANKING CODES AND STANDARDS BOARD OF INDIABalance Sheet as on March 31, 2012

21

As on March 31,

2011

PROPERTY & ASSETS As on March 31,

2012

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

As onMarch 31,

2012

As onMarch 31,

2011

FUNDS AND LIABILITES

Trust Funds or Corpus

116,092,000 Balance as per last Balance Sheet 116,092,000

Add: Contribution received during the year 35,098,000 151,190,000

Other earmarked funds

— Public Awareness Fund

25,397,721 Balance as per last Balance Sheet 25,397,721

Less: Transferred to Income and 500,000 Exp. Account

Add: Transferred from Income & 4,884,291 29,782,012 Exp. A/c

229,390 For advances from RBI 29,836

141,719,111 Total 181,001,848

— Immovable properties —

Investments -

35,835,312 Govt.securities (cost)-Annex-I 35,835,312

— Furniture and fixtures —

— Loans (Secured or unsecured) —

Advances -

To others-

180,867 - Tax Deducted at Source 141,710

8,770 - Premium on GOI Securities 7,412 149,122

Income Outstanding -

6,075,034 - Interest 11,078,964

Cash and Bank Balances-

99,618,818 - In current account or fixed 133,938,192 deposit account- Annex II

310 - Stamps 258 133,938,450

141,719,111 Total 181,001,848


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

Date and year Kind of investments Full description such as name of the Face Value Cost Rate of Remarksof preparation company, distinctive Nos. of shares interest and certificates, type of shares, etc. borne by Date of redemption or repayment investments1 2 3 4 5 6 7

At the (i) Shares — beginning of (ii) Bonds and Debentures — the year (as on (iii) Deposits — April 1, 2011) (iv) Others — (v) Public Securities a) 7.37% GOI Securities 2014 14,500,000 14,118,650 7.37% b) 8.07% GOI Securities 2017 1,480,000 1,480,000 8.07% c) 7.49% GOI Securities 2017 12,000,000 11,470,414 7.49% d) 7.99% GOI Securities 2017 2,800,000 2,800,000 7.99% e) 7.59% GOI Securities 2016 2,500,000 2,466,248 7.59% f) 8.24% GOI Securities 2018 3,500,000 3,500,000 8.24% 36,780,000 35,835,312Increase during the year (2011-12) —Decrease during the year (2011-12) —

Total at the end of the year (as on March 31, 2012) 36,780,000 35,835,312

BANKING CODES AND STANDARDS BOARD OF INDIA Schedule of Investments belonging to the Trust as on March 31, 2012

Annex-I

Annex-II

As on Bank Accounts As on March 31, 2011 March 31, 2012 In Savings Account 2,115,012 - ICICI Bank 729,017

In Current Account 212,489 - Central Bank of India 12,987

In Fixed Deposits 2,909,213 - Karnataka Bank - 2,.993,916 - Karur Vysya Bank 3,252,533 6,522,051 - Yes Bank 3,716,327 20,999,598 - City Union Bank 26,109,509 9,361,151 - Laxmi Vilas Bank 19,876,475 19,504,928 - State Bank of Mysore 27,191,555 2,595,000 - UCO Bank - 2,990,000 - Vijaya Bank - 20,l43,082 - State Bank of Tranvancore 43,777,411 9,272,378 - Central Bank of India 9,272,378 [All accounts in the name of Banking Codes and Standards Board of India]

99,618,818 133,938,192

BANKING CODES AND STANDARDS BOARD OF INDIA Annexure to Balance Sheet as on March 31, 2012

(Amount in Rupees)

As per our report of even dateSd/- (A C Mahajan) M/s. Loonker & Co. Chairman Chartered Accountants

Sd/- Sd/-(N Raja) PartnerChief Executive Officer AuditorsBanking Codes and Standards Board of India

Place: Mumbai Place: MumbaiDate: May 8, 2012 Date: May 8, 2012

22


As per our report of even dateSd/- (A C Mahajan) M/s. Loonker & Co. Chairman Chartered Accountants

Sd/- Sd/-(N Raja) PartnerChief Executive Officer AuditorsBanking Codes and Standards Board of India


BANKING CODES AND STANDARDS BOARD OF INDIAIncome and Expenditure Account for the year ended March 31, 2012

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

Year ended

March 31, 2011

EXPENDITURE Year ended

March 31, 2012

— To expenditure in respect of properties

— To establishment expenses —

— To remuneration to trustees —

— Legal expenses —

— Audit fees —

— To contribution and fees —

— To amount written off

1,358 - Preimum on Govt. Sec. 1,358

— To Miscellaneous expenses 440

— To Depreciation —

To Amounts transferred to Reserve

9,455,656 - Public Awareness Fund 4,884,291

— To Expenditure on objects of the Trust 10,436,118

— To surplus carried over to Balance Sheet —

9,457,014 Total 15,322,207

Year ended

March 31, 2011

Year ended

March 31, 2012

— By Rent —

By Interest

2,788,756 - On securities 2,788,756

6,668,258 - On bank account 12,028,331

— - On income tax refund 5,120 14,822,207

— By Dividend —

— By Donations in cash or kind —

— By Grants —

— By Transfer from Reserve-Public 500,000 Awareness Fund

— By Deficit carried over to Balance Sheet —

9,457,014 Total 15,322,207

INCOME

23


Notes forming part of accounts for the year ended 31 March 20121. The financial statements are prepared on accrual basis.

2. Expenses Borne by Reserve Bank of India The Reserve Bank of India has agreed to fund the gap in expenditure over interest income

upto 2015-16. The Income and Expenditure Account shows only the expenditure incurred by BCSBI out of income. The expenses borne by the Reserve Bank of India do not appear therein. The Reserve Bank has also provided furnished Office accommodation & Office equipments free of cost.

3. Advance for Expenses from Reserve Bank of India Out of the amount advanced by Reserve Bank of India for meeting minor expenses, the unspent

closing balance of ` 29,836/- is shown as advance on the liability side in Balance Sheet as against ` 2,29,390/- at the beginning of the year.

4. Corpus Fund As per the funding proposal agreed to by the Reserve Bank of India, BCSBI continues to build

up the Corpus from registration and membership fees so that when the RBI funding ceases BCSBI will be self financed. The member banks have also desired that the entire contribution made by them in the form of registration fees and membership fees be credited to the Corpus. Accordingly, the registration fees and the membership fees are credited to the Corpus Fund during the year.

5. Public Awareness Fund The Board has spent an amount of ̀ 1,04,36,118/- on Public Awareness and it has transferred

an amount of ̀ 5.00 lakh out of Public Awareness Fund to the Income & Expenditure Account. Board has transferred an amount of ̀ 48,84,291/- being unspent interest income to the Public Awareness Fund to be spent for this purpose within the next five years.

6. Previous Year’s figures The corresponding figures for the previous year are re-grouped / re-classified, wherever

necessary.

24

Schedule A

BANKING CODES AND STANDARDS BOARD OF INDIA

As per our report of even dateSd./- M/s. Loonker & Co(A.C. Mahajan) Chartered Accountants Chairman Sd./- Sd./-(N. Raja) PartnerChief Executive Officer AuditorsBanking Codes and Standards Board of India


annual report - banking codes and standards board of india report/ar11-12.pdfbanking codes and...

Documents