we are with you! - apgvbank.in

we are with you!

15�� Annual Report 2019-20

Empowering Rural Lives

Chairman

With Best Compliments from

K. Praveen Kumar

Andhra Pradesh Grameena Vikas Bank

Head Office, Warangal - 506 001

01

we are with you!Annual Report 2019-20

Inside the Report

1. Letter of Transmittal 03

2. Geographical Presence & Regional Offices 04

3. Board of Directors 05

4. Executives Team 06

5. Head of Departments & Regional Managers 07

6. Our Mentors, Regulators / Supervisors 08

7. Highlights 2019-20 09

8. Chairman's Message 10

9. Key Performance Indicators 12

10. Board of Directors Report 17

11. Auditor's Report 59

12. Balance Sheet, Profit & Loss 65 Account and Schedules

S.No. Particulars Page No.

VisionBe the preferred Bank of Rural India for development and

transformation.

we are with you!

MissionBe a financial heart, providing Sustainable livelihood to rural

population through Innovative Financial and Technology solutions.

Respect to Systems and Procedures / Good Governance / Transparency /

Service with compassion / Ethics / Team work and People Focus.

Values

02


Andhra Pradesh Grameena Vikas BankHead Office : Warangal

Date : 30.06.2020

The Secretary,

Ministry of Finance, Dept. of Financial Services

Banking Division, Government of India

Jeevan Deep Buildings, Parliament Street,

New Delhi-110001

Dear Sir,

In accordance with the provisions of Section 20 of the Regional Rural Banks Act 1976,

I forward herewith the following documents.

A Report of Board of Directors as to the Bank's working and its activities during the period

st st1 April 2019 to 31 March 2020

A copy of the Audited Balance Sheet and Profit and Loss Account for the year ended st31 March 2020.

stA copy of the Auditor's report in relation to the Bank's accounts for the period 1 April 2019 to st31 March 2020.

Letter of Transmittal

Yours faithfully,

(K. Praveen Kumar)Chairman

03


SrikakulamSaraswathi Complex, Baker sahed petaSrikakulam 532001, [email protected]

Vizianagaram8-12-64/1, Beside Himagiri Theatre,Vizianagaram 535002, [email protected]

Visakhapatnam52-14-77/1, APHSC Building,Near Eenadu office, SeethammadharaVisakhapatnam [email protected]

ParvathipuramVizianagaram Dist. 1435-27-112, Ist Floor, By Pass Road, Opp. Sai Ram [email protected]

Regions in Telangana State

KhammamWyra Road, Khammam 507001Tel [email protected]

NalgondaRamgiri, Nalgonda 508001Tel [email protected]

WarangalABK Mall,Ramnagar, HanamkondaWarangal 506001Tel [email protected]

MahabubnagarH.No: 10-4-16/4/2, 4th Floor, YenugondaMahabubnagar - 509 002, [email protected]

SangareddyH.No.5-1-28/4, 2nd Floor, By Pass Road, Prashanthnagar, Rajampet, Sangareddy. Dist: State: Telangana - [email protected]

AshoknagarShekar Arcade, Opp. Beeramguda Kaman,RC Puram Mandal Dist. Sangareddy [email protected]

Bhadrachalam (Kothagudem)D-No: 3-2-199, IInd Floor, Vidyanagar ColonyChunchupally, Bhadradri Kothagudem (Dist)- [email protected]

Regions in Andhra Pradesh

Geographical sence & Regional Offices pre

04

Head Office :D. No. : 2-5-8/1, Near Ambedkar Statue, Ramnagar, Hanamkonda - 506 001 Warangal [Telangana]Ph: 0870-2577769 Tollfree: 1800-121-0354 email : [email protected] www.apgvbank.in I I I

64%

24%

12%(Rural)

(Semi Urban)

(Urban)

BranchClassification

BOARD OF DIRECTORS

Shri K. Praveen KumarChairman

(General Manager on deputation from State Bank of India)

Nominees of Central Government under Section 9 (1) (a) of the Regional Rural Bank's Act, 1976

Nominee of Reserve Bank of India under Section 9 (1) (b) of the Regional Rural Bank's Act 1976

Shri Y. Rambabu Asst. General Manager,

, Reserve Bank of India, HyderabadHRMD

Nominee of NABARD under section 9 (1) (c) of the Regional Rural Bank's Act, 1976.

Shri Sukanta K Sahoo, Deputy General Manager

NABARD, TSRO, Hyderabad

Nominees of State Bank of India under Section 9 (1) (d) of the Regional Rural Bank's Act, 1976

Shri Bhuvanendra TakoorDeputy General Manager (ABU), State Bank of India, LHO, Amaravati

Shri S. GanesanGeneral Manager (RRBs), State Bank of India, Corporate Centre, Mumbai

Nominees of State Government under Section 9 (1) (e) of Regional Rural Bank's Act, 1976

Shri Rayi Ravi

Additional Secretary

Finance Department

Govt. of Telangana

Vacant

Shri KVV Satyanarayana, IRASSpecial Secretary to Govt. (B&IF)

Finance Department, GOAP, Amaravathi.

Vacant

05


Executive Team

Shri K. Praveen KumarChairman

Shri P.PardhasaradhiGeneral Manager -IV

Shri G.SukumarGeneral Manager-I

Shri G. NagarajuGeneral Manager - III

Shri N.V. RamanaGeneral Manager - V

Shri K.E SubrahmanyamuGeneral Manager - VI

Shri Ch.Sree Rama SomayajiGeneral Manager - II

06


Shri S. LaxmanAGM (Credit & RRM)

Shri M.B.T. ReddyAGM (FIC)

Shri T.V.V. PrabhakarAGM (A&I)

Head of Departments

Regional Managers

Shri K. Vinod ReddyAGM (Per & HRD)

Shri B. PrakashAGM & RM, Vizianagaram

Shri Riyaz MohammadRM, Parvathipuram

Shri M. Manohar ReddyAGM & RM, Vishakapatnam

Shri B. Srinivasa MurthyRM, Khammam

07


Shri A.S. SarmaChief Manager (P&D)

Shri K. Amarender ReddyChief Manager (SLC)

Shri G. Sreedhar ReddyChief Manager (IT)

Shri N.V. Srinivas RaoChief Manager (Accounts)

Shri P. RajuAGM & RM, Warangal

Shri D. V. Gurunatha RaoAGM & RM, Srikakulam

Shri D. Vishwa PrasadAGM&RM, Ashoknagar

Shri B.R.V. Manoj KumarAGM&RM, Mahabubnagar

Shri Mallempati RaviAGM&RM, Sangareddy

Shri S.L.N. PrasadAGM & RM, Nalgonda

Shri I. SrikanthRM, Bhadrachalam

Our Mentors

Shri Dinesh KharaManaging DirectorState Bank of India

Corporate Centre, Mumbai

Shri SP SinghChief General Manager (A &S),

State Bank of IndiaCorporate Centre, Mumbai

Shri Rajnish KumarChairman

State Bank of India Corporate Centre, Mumbai

Our Regulators Supervisors/

Shri Vijay KumarChief General Manager,

NABARD, TSRO, Hyderabad

08


Shri S. SelvarajChief General Manager,

NABARD, RO, HyderabadAP

v Deposits increased to Rs. crore 7 crore18495.69 Rs.16055.9 with a from the previous year's level of

growth rate of % 15.20 . (Rs. 2439.72 Crore)

v Advances at Rs.19322.97 crore increased by Rs 2664.56 Crore @ 16.00% from Rs.16658.41 crore.

v Operating Profit increased by 26.60% to Rs 1213.02 Crores from Rs 958.17 Crores.

v Gross NPA as % to total Advances has come down to 1.03%(Rs.198.50 Crore) from 1.14%.

v Bank has achieved Net NPA of Zero compared to previous year's Rs.55.62 crore.

v Cost to Income Ratio (Expenses Ratio) decreased from 28.19 % to 25.26%.

v Non-interest Income had increased by 42.36% to Rs.409.93 crore from Rs.287.95 crore.

v Yield on Advances improved to 11.55% from 11.35%.

v Net Interest Margin improved to 4.73% from 4.36%.

v Net Interest Income up by 15.92% to Rs.1213.04 Crore from Rs.1046.44 Crore.

v Business per Branch increased to 48.79 Crore from 42.21 Crore

v Business per employee increased to 11.44 Crore from 10.28 Crore.

v Net Profit per Branch increased to 79.69 Lakh from 14.46 Lakh.

v Net Profit per Employee increased to 18.69 Lakh from 3.52 Lakh.

v Reserves increased by 27% to Rs.2905 Crore from Rs.2287 Crore.

v Housing Loan portfolio increased by Rs.754.44 Crore @ 39.88% to Rs.2646.31 Crore from Rs.1891.87

Crore

v Gold Loan portfolio doubled to reach Rs.953.62 Crore from Rs.485.27 Crore.

v Bank has opened 7 more Asset Management Hubs during the FY taking total hubs to 26.

v Bank has shifted its Staff Learning Centre, IT Cell& Sangareddy Regional Office to Banks own, newly

constructed & spacious premises in Sangareddy

Highlights 2019-20

Total Business37819 Crore

15.60%

Net Worth2999.03 Crore

25.97%

Net Profit617.58 Crore

451.25%

16.15%Capital adequacy Ratio

11.55%Yield on Advances

100%Provision Coverage Ratio

104.47%Credit - Deposit Ratio

09


Chairman’s Message

It gives me great pleasure to place before you the

highlights of Bank's performance during the financial

year 2019-20.

The financial year ending March 31, 2020 was a very

good year for APGVB. The trust of our Customers and the

dedication of our employees helped us achieve

phenomenal results.

In the FY 2019-2020, Bank's total business grew by

15.60% to Crore from the previous year's Rs. 37818.66

level of Rs. 32714.37 Crore. The deposits grew by

15.20 from the previous year's % Rs. 18495.69 , to Crore

level of Rs. 16055.97 Crore & gross advances of Bank

recorded a growth rate of 16.00% & grew to

Rs. 19322.97 Crore from the previous year's level of

Rs. 16658.41 Crore The growth in credit was mostly

driven by Housing loan portfolio & the portfolio grew by

39.87% to Crore from previous year's level of Rs. 2646.31

Rs. 1891.87 Crore. We ended the year with a net worth

of Crore & at the end of year we had over Rs. 2999.03

3300 employees.

The primary contributors to this stellar year were our

continued focus on diversifying business – especially

Housing Loans and our ability to garner high value

customers in a consistent manner. In addition, we paid

relentless attention to our operating discipline by

strengthening Branch visit mechanism.

Profitability

FY 2019-2020 has brought about s ignif icant

improvement on asset quality front, provision coverage,

NIM and yield on advances. The profit of the Bank could

have been much higher but for the pension provisions

made as per the Government of India guidelines.

The net interest income of the Bank stood at 1213.04 Rs.

Crore registering a healthy growth of 15.90%.The

Operating profit of the Bank grew by 26.60% to


Rs. Rs. 958.17 Crore. The bank made a net profit of

617.58 crore compared to 112.04 Crore recorded in Rs.

the previous year.

Concerted efforts towards recovery in stressed assets

and strict monitoring led to fall in Gross NPA ratio of the

Bank to 1.03% in March 2020 from 1.14% in the

previous year, Bank has made remarkable decision to

10


K. Praveen KumarChairman

Yours sincerely,

(K. Praveen Kumar)

Chairman

earmark 100 % Provision Coverage Ratio compared to

previous year's 70.59% , which resulted in Net NPA

becoming 0%.

Investments portfolio reduced by Rs. 1553.45 Crore

during FY 2019-20. Bank has to dis invest to

accommodate the funding of pension provision (Fully

provided).Further, Investment to deposit ratio reduced

to 20.76% from 33.58%.

Technology initiatives

Information Technology has been the backbone of the

Bank supporting seamless operations, customer

outreach, better products and services and business

growth. The Bank has witnessed enormous amount of

technology transforming the Bank, keeping pace with

the rest of the industry and enabling the Bank to achieve

the business volumes that it has today.

With over 12.46 Lakh Active Debit cards, Bank is pioneer

in catering to the people in remote villages.

APGVB Bank Mobile Banking app, one of the top rated

mobile Banking App across all RRBs has achieved more

than 5 Lakh Downloads & over 3.2 lakh Registered users

as on March 31, 2020. This reflects the growing

customer confidence in our products.

Bank has installed around 90 SWAYAMs (Barcode based

Passbook Printing Kiosks) in urban pockets for the

convenience of customers.

Bank has also launched multiple In-House IT portals like

RFIA Audit Portal, Snap Audit Portal , Staff Annual

Appraisal portal , MIS Portal , Suit file dashboard to name

a few during the FY 2019-20 for easy & effective

monitoring of data.

Customer satisfaction

With a view to increase customer convenience, the Bank

has created few touch points. The Bank has more than

2028 operating Bank Mitras and 775 Branches. Bank is

among the leading RRBs in extending social security

initiatives like APY, PMJJBY, PMSBY and other schemes to

its valued customers as envisaged by Government. More

than 1600 Financial Literacy awareness camps were

conducted during FY 2019- 20 by the Bank Financial

Literacy Centres.

During the last few weeks in March we started to see the

impact of COVID-19, during which our team worked

with incredible dedication towards the service of the

customers. Our focus has been and remains the safety of

our employees, the delivery of service to our customers

and the financial well-being of the Bank. Immediately,

Bank had taken preventive measures to safeguard the

interest of Staff & advised all staff members to attend

duty on alternate day basis.

A strong Balance Sheet, with a net worth Rs. 2999.03

Crore and Capital Adequacy position of the Bank which

improved from 15.50% in March last year to 16.15% in

March 2020, puts us in an position.excellent

Way Forward

As government is proposing phased unlock of all

activities &critical vaccine solutions are in advanced

stages, we will be closely monitoring the impact of

pandemic and will be increasing our Business

accordingly. Efforts will also be directed to achieve a

more sustainable mix of business.

We remain extremely focussed on the needs of our

customers and even more ready to extend our support

to the customers as we continue to emerge from this

unprecedented situation.

I want to especially thank our team for demonstrating

incredible ability to execute throughout the last

financial year and for their stellar performance and

dedication under a difficult situation in the past few

months. Looking ahead, I am optimistic of the

opportunities of the work we are doing for our

customers and the approach we have put up in place.

11


Key Performance Indicators Rs. in 000's

Indicators 2017-18 2018-19 2019-20

A KEY PERFORMANCE INDICATORS

1 No. of Districts covered 22 22 24

2 No. of branches 768 775 775

a) Rural 494 499 499

b) Semi urban 181 183 183

c) Urban 52 52 52

d) Metropolitan 41 41 41

Ultra-Small Branches 488 488 488

3 Total Staff (excluding Sponsor Bank Staff) 3160 3181 3305

of which, Officers 1925 1976 2085

4 Deposits 143336293 160559557 184956906

Growth % 11.82 12.02 15.20

5 Borrowings outstanding 80412059 64710050 84658752

6 Gross Loans & Advances outstanding 143166957 166584100 193229653

Growth % 15.75 16.36 16.00

of 6 above, loans to Priority Sector 131227119 149713863 173765307

of 6 above, loans to Non Target Groups 11939837 13469285 19464346

of 6 above, loans to SC/ST 32116955 36109816 38517022

of 6 above, loans to SF/MF/AL 87126238 100301277 109918623

of 6 above, loans to Minorities 8420724 9921516 11569468

7 CD Ratio 99.88 103.75 104.47

8 Investments Outstanding 114273690 98796639 119700729

SLR Investments Outstanding 57638582 53170560 37538535

Non-SLR Investment Outstanding 56635188 45626079 82162194

B AVERAGE

9 Average Deposits 133477904 144685619 168335004

Growth % 15.55 8.40 16.35

10 Average Borrowings 57646511 77150828 66145232

Growth % 26.81 33.83 -14.27

11 Average Gross Loans And Advances 129871031 152339085 170747803

Growth 18.00 17.30 12.08

12 Average Investments 74664481 87720536 85556869

Growth % 26.87 17.49 -2.47

Average SLR investments 48841624 54429941 44876389

as % to average deposits 58.35 37.61 26.66

Average Non-SLR Investments 25822857 33290595 40680480

as % to Average deposits -7.80 28.92 24.17

13 Average working funds 223950016 255718080 278936559

12


Rs. in 000's

C LOANS ISSUED DURING THE YEAR

14 Loans issued during the year 106919716 102508485 118025557

Growth % 7.34 -4.12 15.13

of 14 above, loans to Priority Sector 92757898 84016632 98782426

of 14 above, loans to Non-target Groups 14161818 18491853 19243131

of 14 above, SC/ST 21244947 27904191 31560519

D PRODUCTIVITY

15 Per Branch 373051 422666 487984

Per Staff 90666 102843 114429

E RECOVERY PERFORMANCE

16 TOTAL

Demand 115545127 96136986 108645648

Recovery 100949732 84997743 96615493

Over dues 14595395 11139243 12030155

Recovery % 87.37 88.41 88.92

(June position)

17 FARM SECTOR

Demand 49736937 40870154 39648964

Recovery 46449980 36544683 30878654

Over dues 3286957 4325471 8770310

Recovery % 93.39 89.42 77.88

(June position)

18 NON-FARM SECTOR

Demand 65808190 55266832 68996683

Recovery 54499751 48453060 65736838

Over dues 11308439 6813772 3259844

Recovery % 82.82 87.67 95.27

(June position)

F ASSETS CLASSIFICATION

19 (a) Standard 141210532 164693106 191245777

(b) Sub-Standard 262674 495393 813893

1520235 1216164 1162106(c) Doubtful

(d) Loss 173516 179437 8956

Total 143166957 166584100 193230732 Standard Assets as % to Gross Loans & Advances out standings 98.63 98.86 98.97

G PROFITABILITY ANALYSIS

20 Interest paid on

a) Deposits 8414939 8512819 10074433

b) Borrowings 3372854 4716476 3830292

Indicators 2017-18 2018-19 2019-20

13


21 Salary 2170109 2353771 2668873

22 Other Operating Expenses 1008736 1408528 1430633

23 Provisions made during the year

(a) Against NPA's 594063 -314366 1027390

(b) Other Provisions 178863 8390073 2168809

(c) Amortization 0 0 0

24 Interest received on

(a) Loans & Advances 14850970 17287981 19729785

(b) Investments 5418718 6405778 6305348

(c) Others -

25 Other Income 2974895 2879522 4099300

26 Loss / Profit 5030146 1120383 6175731

H Other information

27 Share Capital Deposit Received Nil Nil Nil

28 DI & CGC - - Nil

(a) Claims settled cumulative - - Nil

(b) Claims received but pending adjustment - - Nil

(c) Claims pending with Corporation - - Nil

29 Cumulative Provision

(a) Against NPAs 1676144 1984957

(b) Against Standard Assets 406021 595992

(c) Against Intangible Assets Frauds etc. 231331 616 Nil

30 Interest Derecognized

(a) During the year Nil - Nil

(b) Cumulative Nil - Nil

31 Loans Written off during the year

(a) No. of Accounts 7448 47 5489

(b) Amount 122662 5541 367300

32 Accumulated loss Nil Nil Nil

33 Reserves 21618439 22867634 29049482

Net NPAs 404383 556161 0

% Provisions to gross NPAs 79.31 70.57 100

% Gross NPAs to advances 1.37 1.14 1.03

% Net NPAs advances 0.29 0.34 0

CRAR (%) 15.59 15.50 16.15

Rs. in 000's

Indicators 2017-18 2018-19 2019-20

14


Total Business (Rs in Crore)

15


20

80

4 25

18

7

32

71

4

28

65

0

15.60%Growth Rate

FY 20FY 19FY 18FY 17FY 16

37

81

9

17

34

6

FY 15

Deposits (Rs in Crore)

10

20

2 12

81

9

16

05

6

14

33

4

15.20%Growth Rate


18

49

6

82

80

FY 15

Advances (Rs in Crore)

10

60

2 12

36

9

16

65

8

14

31

7

16.00%Growth Rate


19

32

3

90

66

FY 15

Net Profit (Rs in Crore)

22

3

35

2

11

2

50

3

451.25%Growth Rate


61

8

20

2

FY 15

Per Employees Business (Rs in Crore)

7.0

5 8.4

5

10

.28

9.0

7

11.27%Growth Rate


11

.44

6.1

0

FY 15

Per Branch Business (Rs in Crore)

27

.70 32

.80

42

.21

36

.30

15.60%Growth Rate


48

.79

23

.83

FY 15

16


Makers of Excellence 3.0APY Challenger’s Cup Out performersAPY Leadership Capital

Awards received during 2019-20

Project Loan of Rs. 5 Crore sanctioned by our Bollaram (V) Branch through RASMECCC, Ashoknagar to

M/s Sri Himaghna Constructions, Hyderabad for construction of House Flats.

Project Finance by BankDuring the year, Bank has taken up project financing for Construction of House flats, Independent Houses to Builders

in a big way under its CRE-RH Loan scheme and financed such projects in surroundings of Hyderabad, Warangal,

Kothagudem, Vishakapatanam etc.

Board of Directors Report

2019-20

Lighting up the lives of rural people

17


18

2017-18 2018-19 2019-20

2026

.97

1485

.1

541.

87

1728

.8

2369

.38

640.

58

Total Interest Income

1972

.98

630.

53

2603

.51

Director's ReportWe have pleasure in presenting the 15th Annual Report of

Andhra Pradesh Grameena Vikas Bank (APGVB) together with

the Audited Statement of Accounts, Auditors' Report and the

report on business and operations of the Bank for the financial

year ended on 31st March 2020.

FINANCIAL PERFORMANCE

Business Review

The Bank's total business has registered a growth of

Rs. 5104.26 Crore at 15.60% to reach Rs. 37818.66 Crore as on st st31 March 2020 as against Rs. 32714.40 Crore as on 31 March

2019.

During the period the deposits grew by 15.20% to Rs. 18495.69

Crore from the previous year's level of Rs. 16055.97 Crore &

loan portfolio increased by 16.00% & grew to Rs. 19322.97

Crore from the previous year's level of Rs. 16658.41 Crore.

The growth in credit was mostly driven by Housing loan

portfolio & the portfolio grew by 39.87% to Rs. 2646.31 Crore

from previous year's level of Rs. 1891.87 Crore.

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

2017

-18

2018

-19

12

45

9

14

68

7

17

34

6

20

80

4 25

18

7

28

65

0

32

71

4

Total Business at a glance (Rs. in Crore)

37

81

9

2019

-20

Net Interest Income

Net interest income increased by 15.92% from Rs. 1046.44

Crore in FY 2019 to Rs. 1213.04 Crore in FY2020. Total interest

income increased from Rs. 2369.38 Crore in FY2019 to

Rs. 2603.51 Crore in FY2020 registering a growth of 9.88%.

Total interest expenses increased from Rs. 1322.93 Crore in

FY2019 to Rs. 1390.47 Crore in FY2020.

Interest Income and Expenditure

Interest income increased from Rs. 2369.38 Crore in FY2019

to Rs. 2603.51 Crore in FY 2020 registering a growth of 9.88%.

The interest income is contributed mainly by increase in

interest income on loans and advances, which increased from

Rs. 1728.80 Crore to Rs. 1972.98 Crore registering a growth of

Rs. 244.18 Crore (@14.12%).During this year interest income

received from investments was Rs. 630.53 Crore.

The interest expenditure increased from Rs. 1322.93 Crore in

FY 2019 to Rs. 1390.47 Crore in FY 2020. The Interest

expended on deposits increased by 18.34% from Rs. 851.29

Crore in FY 2019 to Rs. 1007.44 Crore in FY2020. Bank has paid

Rs. 383.03 Crore towards interest on Borrowings (refinance

from NABARD, NHB and MUDRA and Intrest paid on SBI /

HDFC OD accounts) during the year compared to Rs. 471.65

Crore paid during FY 2019 with a decrease of Rs. 88.62 Crore.

Net Interest Income

FY 2019 FY 2020


19

1046

.44

1213

.04

(Rs. in Crore)

Interest income on advances

Total Interest Income

Interest Income on Investment

(Rs. in Crore)

FY 2018

848.

19

Income and Expenditure

Interest Expenditure

Non-Interest Income and Expenses

Non-interest income increased by 42.36% to Rs. 409.93 Crore

in FY2020 as against Rs. 287.95 Crore in FY2019. During the

year, Bank's Non-interest expenditure increased marginally

by 8.96% to Rs. 409.95 Crore compared to Rs. 376.23 Crore

incurred in the FY 2019.

Operating Expenditure

Operating expenditure has increased by Rs. 33.72 Crore (8.96%) to Rs. 409.95 Crore in FY 2020 from Rs. 376.23 Crore in previous FY 2019. The marginal increase in operating expenditure is due to increase in Employee costs fromRs. 266.19 Crore to Rs. 272.26 Crore.

Net Profit

The Net profit of Bank was at Rs. 617.57 Crore for the FY 2020 as compared to Rs. 112.04 Crore in FY 2019. Banks net profit increased substantially by 451.25% as Bank had to make lesser provision of Rs. 206.32 Crore towards Pension liability compared to Rs. 837 crore made in the previous fiscal.

(Rs.in Crore)

Profit Analysis

Non-Interest Income increased from Rs. 287.95 Crore in FY

2019 to Rs. 409.93 Crore in FY 2020 registering a healthy YoY

growth of 42.36%. The growth in Net Interest Income (NII) is

mainly due to increase in PSLC (Priority Sector Lending

Certificate) income from Rs. 31.85 Crore to Rs. 112.13 Crore.

Interest income also increased from Rs. 2369.38 Crore in FY

2019 to Rs. 2603.51 Crore in FY 2020 recording a growth rate

of 9.88%. Bank’s operating profit (Before Provisions and

Contingencies) increased from Rs. 958.17 Crore recorded in

FY 2019 to Rs. 1213.02 Crore in FY 2020 registering growth of

26.60%. Despite earmarking Rs. 319.62 Crore for provisions &

contingencies including provisions to cushion against future

slippages bank has registered very good profit this year.

The other factors that impacted the Net Profit figure are:

a) A sum of Rs. 3.96 crore was recovered from written

off/AUCA accounts.

b) Booked a Profit of Rs. 40.67 crore from Treasury operations

compared to Rs. 14.50 crore in the previous fiscal.

Interest Expenditure

Interest ExpenditureInterest Paid on deposits

Interest Paid on Borrowings

Particulars 2018-19 2019-20 Growth %

Interest Income 2369.38 2603.51 9.88%

Interest Expenditure 1322.93 1390.47 5.11%

Non-Interest Income 287.95 409.93 42.36%

Non-Interest Expenditure 376.23 409.95 8.96%

Gross Profit/Operating profit 958.17 1213.02 26.60%

Taxes 45 276.93 515.40%

Deferred Tax Asset & 6.44 1.10 -82.92%Earlier year adjustments (excess)

Provisions and Contingencies 807.57 319.62 -60.42%

Prior Period depreciation 0 0 & rent

Net Profit 112.04 617.57 451.20%

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

2017

-18

2018

-19

2019

-20

120159 180 202 223

503

112

618Net Profit at a glance


20

42.36%YoY Growth in Non-Interest Income

33

7.2

9 84

1.4

9

11

78

.78

47

1.6

5

85

1.2

9 13

22

.94

38

3.0

3 10

07

.44

13

90

.47

352

647%YoY Growth in Non Profit

2017-18 2018-19 2019-20

(Rs in Crore)

AssetsO/s

Provision

O/sProvision

2018-19 2019-20

c) Share of Gross NPAs as a % of Total Advances reduced

from 1.14% in FY 2019 to 1.03% in FY 2020.

d) Growth in Business also contributed to increase in

interest spread and in turn increase of profit of the Bank.

e) Bank has earmarked 100% provisions for non-performing

assets.

f) Increase in income on PSLC from Rs. 31.85 Crore per FY

2019 to Rs. 112.13 Crore in FY 2020.

Provisions for NPAs

Bank has made a Provision of 198.5 Crore for non-performing

assets in FY 2020 as against Rs. 133.48 Crore in Fy2019. Bank

has accounted for 100% provision coverage ratio this year. The

Bank has written back a provision of Rs. 36.73 Crore on NPAs

during the year.

Due to COVID-19, Bank has followed a graded approach as per

RBI guidelines in making provisions for stressed assets and

accordingly 5% provision was made during March 2020

quarter amounting to Rs. 98,82,037 Rupees only.

S.

No.Ratios

2018-

19(%)%

Change2019-

20(%)

Standard 16469.31 49.03 1912.47 59.60

Sub Standard 49.54 7.6 81.39 81.39

Bad & Doubtful 121.62 107.94 116.21 116.21

Loss 17.94 17.94 0.90 0.90

Total 16658.41 182.51 19322.97 258.1


8 % of Non Interest Income (Other Income) to Working Funds 1.13 1.473 0.09%

9 Operating Profit (Before provisions) to Working Funds 3.75 4.35 16.00

10 Return on Assets(Net profit as % to working Funds) 0.44 2.21 402.27

11 Return on Equity 4.71 20.59 337.15

12 Total Business Per Employee (Rs.in 000's) 102843 114429 11.27

13 Total Business Per Branch (Rs.in 000's) 422121 487984 15.60

14 Average Business Per Employee (Rs.in 000's) 93375 102597 9.88

15 Net Profit Per Employee (Rs.in 000's) 352 1869 430.85

16 Net Profit Per Branch (Rs.in 000's) 1446 7969 451.09

17 Provision Coverage Ratio 70.59 100 41.66

18 Average Return of Funds (Financial Return) 9.32 9.48 1.72

19 Average Cost of Funds (Financial Cost) 5.17 4.98 -3.68

20 Financial Margin (18-19) 4.15 4.50 8.43

21 Cost of Management (Transaction Cost) 1.47 1.47 0.00

22 Miscellaneous Income 1.07 1.47 37.38

23 Risk Cost 0.08 0.41 412.50

24 Net Margin (18+22)(-19+21+23) 3.67 4.09 11.44

25 Net Interest Income 10464465 12130408 15.92

26 Net Interest Margin (NIM) 4.36 4.73 8.49

27 Gross Rate of Return(GRR) 0.38 1.82 378.95

28 Other Income Ratio (Non Interest Income) as a % to Total Income 10.84 13.60 25.46

29 Growth In Business 14.18 15.60 10.01

30 Investment to Deposit Ratio 51.01 54.50 6.84

31 Borrowings to Advances Ratio 38.85 43.81 12.77

32 CASA Deposits to Total Deposits 41.46 39.77 -4.08

33 Cash to Deposits Ratio 0.93 0.56 -39.78

(Rs. in Crore)

Ratio Analysis

S.

No.Ratios

2018-

19(%)%

Change2019-

20(%)

1 Cost of Deposits 5.88 5.98 1.70

2 Cost of Borrowings 6.11 5.79 -5.24

3 Yield on Advances 11.35 11.55 1.76

4 Yield on Investments 7.47 7.85 5.09

5 Expenses Ratio (Cost to Income Ratio) 28.19 25.26 -10.39

6 CD Ratio 103.75 104.47 0.69

7 Interest Income as % to Working Funds 9.27 9.33 0.65

21

100%

Provision Coverage Ratio

FY 2020

539698

8791080

1304

1656

21622287

Reserves (Rs in Crore)

2905

The following table gives the position of Tier-I, Tier-II

Capital, Reserves and computation of CAR. (Rs in Crore)

Balance sheet size

The Balance Sheet of the Bank stood at Rs. 31276.20 Crore as st ston 31 March, 2020 compared to Rs. 26637.44 Crore on 31

March , 2019 recording a growth of Rs. 4638.76 Crore

Capital and Reserves

Authorized Capital:

Pursuant to The Regional Rural Banks (Amendment Act)

2015,Raised the Authorized Capital of the Bank from 5,00,000

Equity Shares of Rs. 100/- each aggregating to Rs. 5 Crore to

200,00,00,000 Equity Shares of Rs. 10/- each aggregating to

Rs. 2000 Crore.

Paid up Capital:

The Bank's paid up capital stood at Rs. 94,08,50,000

(9,40,85,000 shares of Rs. 10 each), subscribed by

Government of India, State Government and State Bank of

India in the ratio of 50:15:35.

Reserves

The Reserves increased by 27% (Rs. 618 Crore) to Rs. 2905

Crore in FY 2020 as against Rs. 2287 Crore recorded in previous

year.

2011-12

2012-13

2013-14

2014-15

2015-16

2016-17

2017-18

2018-19

2019-20

Net worth

Net worth of the Bank stood at Rs. 2999 Crore with a growth of

Rs. 618 Crore (26 %) over previous FY's figure of Rs. 2381

Crore.

The Capital Adequacy Ratio of the Bank is at 16.15 % as on

March 2020 up 65 bps YoY (15.5% as on March 2019) which is

well above the level of minimum 9% stipulated for RRB’S by Dr.

K.C. Chakravarthi Committee.

Capital 2018-19 2019-20

1 Tier-I

a. Paid up Capital 94.08 94.08

b. Share Capital Deposit 0 0

c. Statutory Reserves &

Surplus 455.49 579.00

d. Capital Reserves 0.01 11.10

e. Other Reserves 14.31 14.31

f. Spl. Reserve u/s 36(1)(Viii)

of Income Tax Act 1961 14.47 39.01

g. Surplus in P&L 1786.5 2245.53

Total reserves (b+c+d+e+

f+g) 2270.78 2888.96

Total Tier-I Capital 2364.9 2983.04

2 Tier-II

a. Undisclosed Reserves

b. Revaluation Reserves

c. General Provisions &

Reserves 49.09 59.65

d. Investment fluctuations

Reserves / Fund 15.99 15.99

Total Tier-II Capital 65.08 75.64

Grand Total (Tier I + Tier II) 2429.9 3058.68

3. a. Adjusted value of funded

risk assets i.e., balance

sheet items 15653.69 18902.77

b. Adjusted value of non-

funded risk assets i.e.,

balance sheet items 21.47 39.52

c. a+b 15675.2 18942.29

d. Percentage of Capital

(Tier-I + Tier II) to Risk

Weighted Assets 15.5 16.15


FY 2019 FY 2020

15

.50

% 16

.15

%

Capital Adequacy Ratio

22

Borrowings

The aggregate borrowings of the Bank as on 31st March 2020

stood at Rs. 8466 crore whereas it was Rs. 6471 Crore as on

31st March 2019.

(Rs. in Crore)

Institution 2018-19 2019-20 �VarianceS.No

The Bank has availed refinance against Crop loan

disbursements from NABARD @ 20%. Refinance against SHG

disbursements and Rural Housing was provided by NABARD

and NHB respectively @ 100%.

TREASURY OPERATIONS

The Treasury Department at Head Office performs the

Treasury Operations of the Bank. It is responsible for

deployment of surplus funds available in the markets to

achieve desired risk-adjusted returns. The treasury dept is

responsible for managing the funds position of the Bank and

ensuring safety, liquidity and optimal yield on these funds. It

maintains Statutory Reserve Requirements and invests in

corporate bonds, commercial papers, equity, mutual funds,

etc. as a part of the fund management operations.

Investments

In the year under review SLR investments decreased from

Rs. 5317.06 Crore to Rs. 3753.85 Crore. However, total

investments increased from Rs. 9879.67 Crore to Rs. 11970.07

Crore registering a growth rate of 21.07%.

Deposits

The deposits grew by 15.20% (Rs. 2439.72 Crore) to


Rs. 16055.95 Crore.

Deposit Mix

CASA deposits grew by Rs. 699.66 Crore at 10.51 % to reach

Rs. 7355.77 Crore as against Rs. 6656.11 Crore as on

31.3.2019.

Time deposits of Bank has grown from Rs. 9399.84 Crore as of

March 2019 to Rs. 11139.92 Crore as of March, 2020,

registering a growth of Rs. 1740.08 Crore (18.51%).

CASA Deposits accounted for 39.77% of total deposits

(Rs. in Crore)

(Rs. in Crores)

Deposit mix 2018-19 2019-20

Current A/c 186.14 159.84

Growth 64.34 26.30

Growth % age 52.82 -14.13

Savings Bank A/c 6469.97 7195.93

Growth 549.83 725.96

Growth %age 9.29 11.22

Total CASA 6656.11 7355.77

Growth 614.17 699.66

Growth %age 10.17 10.51

CASA Ratio 41.46 39.77

Term Deposits 9399.84 11139.92

Growth 1108.15 1740.08

Growth %age 13.36 15.62

Total deposits 16055.95 18495.69

Growth 1722.41 2439.73

Growth % Age 12.02 15.20

Investments 2018-19 2019-20

SLR 5317.06 3753.85

Growth -446.80 -1563.21

Growth % age -7.75 29.40

Non SLR 4562.61 8216.22

Growth -1100.90 3646.17

Growth % age -19.44 79.78

Total Investments 9879.67 11970.07

Growth -1547.70 2082.96

Growth % age -13.54 21.07

Though average investments decreased, income on

investments increased.

1 NABARD 6376.08 7066.31 690.23

2 SBI & HDFC 2.13 1346.42 1344.29

3 NHB 72.80 53.14 -19.66

4 MUDRA 20.00 0 -20.00

Total 6471.01 8465.87 1994.86


Deposits

2017-18

2018-19

2019-20

6041.948291.69

14333.63

6656.119399.84

16055.95

7355.76811139.92

18495.69

Total Deposits Term Deposits Total CASA

23

(Rs. in Crore)

(Rs. in Crore)

Inauguration of Indrakannu Branch New Premises in Sangareddy Region

by Chairman Sri. K. Praveen Kumar

Investment Policy:

The Investment Policy of the Bank was formulated in 2006 and

the same was reviewed / revised and approved by the Board

from time to time, conforming to the RBI guidelines.

SLR Investments

In terms of Section 24 of the BR Act 1949, the Bank has

maintained investments in the avenues laid down in the Policy,

to fulfil the SLR requirements. All SLR investments are made

in GOI / State Govt Securities only. The purchase and sale of

Govt Securities are undertaken by the Portfolio Management

Services Department of State Bank of India.

Non SLR Investments

Non-SLR investments are invested in TDRs of Banks. The Bank

has been monitoring and following up for prompt receipt of

interest due from Govt Securities /Bonds. There was no

instance of income leakage from Non-SLR investments

portfolio.

CRR and SLR

The Bank has complied with the regulatory requirement of

maintenance of adequate balances towards CRR and SLR.

There is a well laid down system of assessing the CRR and SLR

requirements taking into account the NDTL. There was no

default in maintenance of adequate balances during the year.

The Bank has kept Rs. 530.75 Crore in CRR and Rs. 3868.93

Crore in SLR as on 31.03.2020.

Inauguration of New premises of Regional Office of Mahaboobnagar by

Chairman Sri. K. Praveen Kumar

Inauguration of New premises of our Tellapur Branch in Ashoknagar Region by Chairman Sri. K. Praveen Kumar, followed by customer meet


24

Inauguration of New premises of our Narsipatnam Branch in Visakhapatnam Region By Chairman Shri K. Praveen Kumar

Farmers Felicitation Program – Best farmers have been Felicitated by General Manager Shri Ch. Sree Rama Somayaji in Mahabubnagar on

th26 January 2020

Staff Interaction Program held at Srikakulam by

Chairman Shri K. Praveen Kumar

CORE OPERATIONSCredit Portfolio

Retail Lending - Home Loans

During FY 2020, Bank's focus continued on increasing the

share of retail lending to Housing sector, Education Loans,

Personal Gold Loans & MSME. Home loans outstanding has

been increased from Rs. 1891.87 Crore in FY 2019 to

Rs. 2646.31 Crore in FY 2020 recording a healthy growth of

40%.Bank has taken up capacity building of the operating staff

to make them better acquainted with retail lending and to

diversify the credit portfolio. Suitable staff was posted in all

Asset Management Hubs to give more fillip to retail business

especially to Home loan business.

Bank is an active member in financing under Government's

flagship scheme, Pradhan Mantri Awas Yojana (PMAY) and

has claimed subsidy from NHB (Nodal Bank) for more than

2140 loan accounts amounting to Rs. 49 Crore (Approx.)

during the year. Bank is having more than 18,000 Housing loan

customers and accounts, and adding many more every day.

The Home loan business now constitutes 13.69% of Banks

total advances. NPAs share in Home loan portfolio is just

0.21% (Rs. 5.74 Crore) which signifies the quality of Home

loan finance. As we move forward, our focus remains on

improving the share of Home loans to total advances.

Gold Loans

In addition to increase in Home loan portfolio, Banks

coordinated efforts to improve share of Gold loans in total

advances portfolio yielded positive results. Bank has

launched 2 new Gold loan schemes during the course of the

year viz., Multipurpose Agri Gold loan & Privilege personal

Gold loans which helped Bank in doubling the Gold loan

business during the period under review compared to

previous year.

Gold loan business levels have increased from Rs. 485.27

crore in FY 2019 to Rs. 953.62 Crore in FY 2020 registering a

growth rate of 96.50%.

The Comparative performance under retail lending during last

2 years is tabulated below: (Rupees in Crore)

S.

No Amt

O/s Mar 2018-19

Segments

O/s Mar 2019-20

No.of

A/csAmt

No.of

A/cs

1 Housing Loans 14741 1891.87 18386 2646.31

2 Mortgage Loans 3579 223.01 3623 227.47

3 Education Loans 1936 60.62 1600 54.11

4 Demand Loans 15783 216.50 13674 222.62

5 NFS - Term Loan /MSME 116010 1357.48 126215 1515.39

6 Personal Loans 8412 251.39 7273 241.74

7 Personal Gold Loans 95040 485.27 144660 953.62

Total 255501 4486.14 315431 5861.26


25

Asset Management Hubs and Rasmecccs

In order to centralise sanction of laons and to improve quality

of loan processing, Bank has opened 7 more Asset

Management Hubs at Patancheruvu, Dabagardens, Kodada,

Bhongiri, Ranasthalam, Chodavaram & Kashibugga during

FY2020 in addition to existing 19 Hubs & 2 RASMECC, taking

total number of Hubs to 28.

With the objective to further strengthening the functioning of

AMHs/RASMECC, controlling structure has been changed. In

addition to this, in order to give more impetus to quality &

focussed SHG lending, Bank has vested discretionary powers

for sanction of SHG loans of above 5 lakhs to Hubs/RASMECC

withdrawing sanctioning powers from Branches.

The Asset Management Hub processes Housing loans,

General Purpose Asset Backed Loans, CRE-RH Loans, MSME

loans& Agriculture Loans (backed by collateral security)

sourced from spoke branches as well as directly received from

the customers.

During FY 2019-2020, AMHs/RASMECC have collectively

sanctioned 44,201 loans aggregating to an amount of

Rs. 4389.37 Crore compared to 2835 loan account with an

amount of Rs. 485.04 sanctioned during FY 2018-2019

Inauguration of Asset Management HUB at our Daba gardens branch

in Visakhapatnam Region on 20.08.2019. By Chairman

Shri. K. Praveen Kumar

Function hall financed by our Miryalaguda Branch, Nalgonda,Regional Office

Rice mill financed by our Maddur Branch, Sangareddy, Regional Office


26

Housing Loans Financed by RASMECC Ahoknagar

Hotel financed by our Siddipet Branch , Sangareddy, Regional Office

KCC, SHG & Other Loans

Credit to Agriculture

Total credit to agriculture and allied activities including

agriculture-portion of SHG lending, stood at Rs. 13154.83

Crore as on 31.3.2020 as against Rs. 11259.36 Crore recorded

during the previous year with a growth of Rs. 1895.47 Crore

(@ 16.83%). Total number of Bank's borrowers in Agriculture

sector has increased from 1102918 to 1193382 in FY 2020.

More than 75 % of the credit to SHG finance is also towards

agricultural operations.

The Bank has disbursed Rs. 7536.95 crore to agriculture during

the year as against the previous year's disbursal of Rs. 6316.74

Crore registering a healthy growth of Rs. 1220.21 Crore.

Total credit to agriculture and allied activities constitutes

63.86% of the total credit portfolio as on 31.3.2020 vis-à-vis

61.62% as at the end of previous FY 2018-19.

Crop loans under revised Kisan Credit Card System

As per the directions of Government of India and NABARD,

we have implemented revised Kisan Credit Card System for

crop loan borrowers from Kharif 2012. According to the

guidelines of revised KCC, we have introduced a new product

KCC-cum-SB account in the CBS for a period of 5 years. As per

this system, the farmers can remit their surplus funds in their

KCC account and can draw according to their requirement and

they need not maintain separate Savings Bank account. There

is a provision for giving interest as applicable for Savings Bank

account for the credit balances in the KCC account. Further,

loan limits will be fixed for 5 years and documents will be

obtained for the terminal limit. Year-wise limits will be fixed

basing on present Scales of Finance and keeping in view the

future cost of investment.

We have issued 968858 KCCs as on March, 2020 with an

outstanding credit of Rs. 7854.48 Crore as against previous FY

level of 920115 KCCs for Rs. 6759.51 Crore.

During the year 2019-20, we have disbursed an amount of

Rs. 4081.17 Crore to 782267 KCC card holders as against

Rs. 3302.53 Crore to 590262 card holders during the year

2018-19. Instructions were issued to all the branches to cover

all KCC holders up to the age of 70 under Personal Accident

Insurance Scheme(PAIS) during the three year card holding

period, with risk coverage of Rs. 50,000/- The annual

premium of Rs. 20/- was jointly borne by the Bank Rs. 13/- and

the borrower Rs. 7/-


27

Car servicing unit financed by our Kodad X Road Branch, Khammam,Regional Office

House Apartments financed by our Siddipet Branch, Sangareddy, Regional Office

Crop Loans - VaddileniRunalu / PavalaVaddi

Government of united Andhra Pradesh had implemented

“Vaddileni Runalu/ Pavalavaddi” scheme i.e., reimbursement

of interest subvention and incentive subvention for prompt

payers of crop loan borrowers from Rabi 2011-12. Under the

VLR Scheme, farmers need not to pay the interest portion. The

scheme has been in existence and continued by both the

States of Telangana and Andhra Pradesh

Interest Subvention

As per Government of India guidelines, Bank is implementing

7% interest rate to all the crop loan borrowers up to Rs. 3.00

lakhs and accordingly claimed an amount of Rs. 57,09,68,809/-

towards 2% interest subvention from the GOI during the year

2019-20. As per the directives of Government of India, we had

passed on the benefit relating to interest subvention incentive

to the extent of Rs. 31,11,41,470/- to the prompt repayers and

claim submitted accordingly.

Conducting of GramaSabhas

All branches have conducted GramaSabhas for the customers,

mainly for the purpose of educating the farmers in timely

renewal of the crop loans to avail the benefit of interest

subvention from Government of India. To ensure maximum

renewals/recovery, GramaSabhas were conducted in the

evenings and mornings and sensitized farmers to renew their

crop loans. Apart from operating staff at Branches,

functionaries from ROs, Head Office right from Messenger to

Chairman have participated in the GramaSabhas, which

yielded very good results in successful renewal of crop loan

accounts and recovery of NPA's.

Tenant Farmers – Loan Eligibility Card Holders

We have financed to 4474 tenant farmers under the Loan

Eligibility Cards Scheme with a credit outstanding of Rs. 11.99

Crore during the year 2019-20. AP Land Licensed Cultivators

Ordinance aims at ensuring loan and other benefits to tenant

farmers, by means of Loan Eligibility Cards.

Joint Liability Groups (JLGs)

In order to develop effective credit products for small /

marginal / tenant farmers, oral lessees and share croppers, as

also entrepreneurs engaged in various non-farm activities, the

scheme for Joint Liability Groups was launched by NABARD.

During the year 1266 groups were financed amounting

Rs. 10.41 Crore and outstanding JLGs finance now stands at

5558 amounting to Rs. 64.18 Crore as on March 31, 2020.

SHG Bank Linkage Program at Narsipatnam, Visakhapatnam, cheque for Rs. 10 crore handed over to SHG Women by Narsipatnam MLA Shri Uma Shankar Ganesh and Chairman Shri K. Praveen Kumar.

Customer service Meet at Srikakulam, attended by Shri J.Nivas, Collector,Srikakulam and Shri. K.Praveen Kumar, Chairman

Self Help Groups

Our Bank has crossed one more milestone of 2,00,000 SHG

groups during the FY 2019-20 and one of the leading Bank

under SHG Finance, we have financed to 204569 Self Help

Groups (covering about 24.04 lakh rural women) with an

outstanding portfolio of Rs. 6402.39 Crore as on 31.3.2020 as

against previous year's level of 194871 Groups with

outstanding credit of Rs. 5857.85 Crore. The total loans

outstanding under SHG segment has increased by Rs. 544.54

Crore at a growth rate of 9.29% during the year 2019-20

against previous year growth of Rs. 273.83 Crore (@ 4.90%).

The Bank has disbursed Rs. 4011.07crore to 172084 Groups

during the year.

The Bank has highest number of Self Help Groups linked to

Bank and loan amount outstanding, among all RRBs in the

country.

In order to further strengthen our SHG base and to improve

income levels of SHG members Bank has launched a new


28

NRLM/NULM / DEENDAYAL ANTYODAYA YOJANA (DAY)

Interest Subvention Scheme

Our Bank has been implementing NRLM Scheme as per the

guidelines issued by NABARD vide their letter No 249/MCID-

LS/2013-14 dated 26.11.2013.

NRLM set out with an agenda to cover 7 crore rural poor

households, across 600 districts, 6000 blocks, 2.5 lakh Gram

Panchayat and 6 lakh villages in the country through self-

managed Self Help Groups (SHGs) and federated institutions

and support them for livelihoods collectives in a period of 8-

10 years.

In addition, the poor would be facilitated to achieve increased

access to rights, entitlements and public services, diversified

risk and better social indicators of empowerment. DAY-NRLM

believes in harnessing the innate capabilities of the poor and

complements them with capacities (information, knowledge,

skills, tools, finance and collectivization) to participate in the

growing economy of the country.

NULM aim at providing shelters equipped with essential

services to the urban homeless in a phased manner. In

addition, the mission would also address livelihood concerns

of the urban street vendors by facilitating access to suitable

spaces, institutional credit, social security and skills to the

urban street vendors for accessing emerging market

opportunities.

In November 2015, the program was renamed as Deendayal

Antayodaya Yojana (DAY).

Under the NRLM Scheme, all Women SHGs promoted by

NRLM or other Central or State Government Line

Departments or NABARD or any NGOs, which are linked with

our Bank, are eligible to avail the benefits of the Scheme. As

per the Scheme, GOI identified 250 backward districts all over

the country under Category-I, of which we have six districts in

our not i f ied area namely Waranga l , Khammam,

Mahabubnagar (erstwhile districts in Telangana state) and

Srikakulam, Vizianagaram, Visakhapatnam in Andhra

Pradesh.

All such Women SHGs in the six districts have been extended

credit at 7% rate of interest upto Rs.3 lakhs and Government

will reimburse to the extent of difference between 7% and

actual rate of interest (12.50%) subject to a maximum of

5.50%.

Apart from this, prompt paying SHGs will be provided an

additional 3% subvention amount as incentive. SERP (Society

for Elimination of Rural Poverty) would credit the remaining

4% interest for prompt repayer sreducing 'ZERO” interest

burden to the groups. We have claimed an interest

subvention @5.50% to the tune of Rs. 134,89,48,744/- and

3% prompt repayment incentive Rs. 62,99,34,913/- during

the year 2019-20.


29

product “Elite SHG” during the FY 2020, which encourages

prompt paying groups to go for a higher limit of upto 10 lakh

(collateral free) from the existing 7.5 lakh limit. This new

product has the potential to have a substantial impact on the

rural economy.

SHG Loan disbursement of Rs 55.44 Crore for 200 SHGs at CustomerOutreach programme in Srikakulam

Our Bank has participated in the Deccan Haat 2020 organised byNABARD, TSRO, Hyderabad. Shri S. K. Joshi Chief Secretary Govt. of Telangana Visting Corporate stall of our Bank

We have two districts among the Category-II districts (other

than the above 250 districts) under NRLM namely Nalgonda

and Medak in Telangana State. Funding for this subvention

will be provided by the SRLM (State Rural Livelihood

Mission).SRLM and SERP will provide each 7% interest as

subvention for prompt repayers through e-transfer to the

SHGs accounts under the Scheme for Category-II districts.

Agriculture investment credit

Bank has an Agriculture investment credit portfolio of

Rs. 690.63 Crore as on (282.20 Crore as on st31 March 2020

31st March 2019). "The objective of doubling farm income by

2022 can be achieved by providing an incentive to agri. term

loans for investment purpose through an enabling mechanism

of either interest subvention or a credit guarantee fund," SBI

said in its research report Eco wrap.

To support the Governments efforts in doubling farmers'

income, Bank has launched few Agriculture investment

products during the course of year aimed at increasing the

income levels of farmers and rural households.

a) Dairy Vikas Loan (Tie Up): With an objective to scale up

regular income of farmers Bank has launched new loan

product “Dairy Vikas Loan scheme” by making tie up

arrangements with Milk procuring companies such as

Vijaya Dairy, NSR Dairy, Heritage foods etc. In the process

the income of farmers will be doubled and they can also

increase the cattle strength in future once they establish

good repayment track record with bank.

Bank has financed to more than 800 dairy farmers and

disbursed an amount to the tune of Rs. 6 Crore under this

scheme during the FY 2020.

b) ATL Vikas Green(Tie-up): Bank has launched this new

product ATL Vikas Green under tie-up arrangement with

Kheyti, an organisation helping farmers for construction

of Green House.

Kheyti was started in 2015 with the mission of giving

small farmers a steady and dependable income through

market driven technology solutions. After seeing first-

hand the huge production risk that small farmers are

exposed to, they have conceptualised the “Greenhouse-

in-a-Box”, an affordable modular greenhouse bundled

with services.

Bank has disbursed more than 2 crore under this scheme.

In addition to this products Bank has also launched APGVB

Crop encash loan product – to provide short term loan to

farmers against the security of fungible farm produce stored

at accredited/ non-accredited ware houses aimed at enabling

the farmers to avoid post-harvest distress sale.

Bank loan products banner being viewed by general public inKhammam SP Stadium

Priority Sector Lending

In terms of RBI Circular No: FIDD.CO.Plan.2/04.09.01/2016-

17 dated 07.07.2016, w.e.f 01.01.2016 75 percent of

outstanding advances should be towards Priority Sector,

which constitutes loans extended to (a) Agriculture (Farm

credit , Agriculture infrastructure, Ancillary activities ) (b)

Micro, Small and Medium Enterprises (Manufacturing and

Service Sector, KVI and OD to PMJDY) (c) Education (d)

Housing (e) Social Infrastructure (f) Renewable Energy (g)

Weaker Sections and (h) Others (SHG/JLG, distressed

persons, Loans to State Sponsored Organizations for

Scheduled Castes/ Scheduled Tribes).

RRBs will have a target of 75 per cent of their outstanding

advances for priority sector lending and sub-sector targets as

indicated in table below.

The Bank's priority sector lending constitutes 89.93% of total

advances. In absolute terms, total priority sector lending

stood at Rs. 17376.53 Crore as on 31.03.2020 as against

Categories Targets

Total Priority Sector 75% of total outstanding

Agriculture 18% of total outstanding

Small and Marginal Farmers 8% of total outstanding

Micro Enterprises 7.5% of total outstanding

Weaker Sections 15% of total outstanding


30

Rs. 14971.39 Crore as on 31.03.2019. There is a growth of

Rs. 2405.14 Crore @ 16.06%. Lending to weaker sections

constitutes 66.60%. In absolute terms weaker sections loans

stood at Rs. 12869.16 Crore as against previous FY's level of

Rs. 12109.51 Crore with an increase 6.27% (Rs. 759.65 Crore).

S.

NoNo.of

A/cs

2018-19 2019-20

No.of

A/cs O/s O/s

Inter Bank Participation Certificates (IBPC)

In accordance with the RBI guidelines, the bank has entered

into Risk sharing participation Contract with HDFC LTD under

Inter Bank Participation Certificate (IBPC) and issued priority

sector advances to the extent of Rs. 590.00 Crore on

28.06.2019 for a period of 180 days as cash pay-out and

maturity period expired on 24.12.2019. During this financial

year the Bank issued priority sector advances to the extent of

Rs. 1100.00 Crore on 24.09.2019 for the period of 180 days as

cash pay-out and maturity period expired on 21.03.2020 and

Rs. 590.00 Crore on 26.12.2019 for the period of 180 days as

cash pay-out and maturity period expired on 23.06.2020.

Further, again during the year the bank issued priority sector

advances to the extent of Rs. 1300.00 Crore on 24.03.2020 for

the period of 180 days as cash pay-out and matures on

20.09.2020.

Priority Sector Lending Certificates (PSLC)

As per RBI master circular No. FIDD.CO. Plan. BC 23/04.09.01

/2015-16 dated 07.04.2016 of PSLC, trading on e-Kuber portal

is an on-going process. All traded PSLCs will expire by March

31st and will not be valid beyond the reporting date (March

31st), irrespective of the date it was first sold.

According to the SBI instructions on trading in "Priority Sector

Lending Certificates" through CBS e-Kuber portal, we have

started trading on e Kuber portal for the financial 2019-20

from 14.06.2019. Our Bank has earned substantial profit of

Rs. 112.13 Crore in FY 2020 compared to Rs. 31.85 Crore

earned during previous year.

Government Sponsored Schemes

The Bank has participated in Govt Sponsored Schemes

actively during the year and as on 31.3.2020, the total finance

extended under various Schemes and loan out standings in

various schemes are as under.

(Rupees in Crore)

(Rs. in Lakhs)

Scheme

Grounding Position of Government Sponsored Schemes

as on 31.03.2020 vis-a-vis achivement

Outstanding position of Government Sponsored Schemesas on 31.03.2020.

(Rs in Lakhs)

Scheme

Outstandingas on 31.3.2020

Disbursement from01.04.19 to 31.03.2020

No. ofUnits

Amt. No. ofUnits

Amt.

1 Weaker Sections 1091638 12109.51 1179281 12869.16

2 Women borrowers 509624 6610.10 612272 7659.82

3 Minorities 87142 992.15 98152 1186.95

4 SCs/STs 306290 3610.98 315425 3815.67

Target Achievement

No. of Amt. No. of Units Units Amt.

SCAP 7150 8155 6251 7135.26

BCAP 4660 3590 4179 3157.61

STAP 1975 861 1624 697.10

Minorities 1086 678 979 620.40

Weavers 825 400 642 292.20

Pasukranthi/PPK 0 0 0 0.00

MEPMA 500 1255 306 496.17

PHC 640 475 483 349.03

Others 2850 3000 2496 2216.64

Total 19686 18414 16960 14964.41

SGSY 1281 1364.83 0 0

RYS 636 1492.37 0 0

SCAP 34213 10698.91 6251 7135.26

BCAP 28066 8130.82 4179 3157.61

STAP 29787 6393.02 1624 697.10

Minorities 5660 5487.21 979 620.40

Weavers 2379 1815.61 642 292.20

VAMBAY/

INDIRAMMA 1326 771.31 0 0

KVIC 16 78.17 0 0

Pasukranthi/PPK 5439 4359.65 0 0

PMEGP 216 124.76 0 0

MEPMA 1680 503.23 306 496.17

PHC 903 506.32 483 349.03

Others 280 268.31 2496 2216.64

Total 111882 41994.52 16960 14964.41


31

Participation in State Credit Plans

The Bank's participation in State Credit Plans is as under:

S.No Target Achiev

ementTarget Achiev

ement

2018-19 2019-20

(Rs in Crore)

CSIS Scheme (Education Loans)

CSIS (Central Sector Interest Subsidy scheme) is a unique

scheme which pivots around the vision that no student

desiring to pursue higher education is denied of the

opportunity if he / she is financially poor. This scheme benefits

all categories of economically weaker students for pursuing

professional / technical courses in India only, and intends to

provide affordable higher education. The Scheme, envisages

uplifting the students from the grass-root level and increasing

the number of qualified technicians / professionals in the

nation. CSIS aims to check the existing geographical

imbalance with regard to Gross Enrolment Ratio (GER) in

Higher Educational Institutions.

The scheme is applicable to students belonging to

Economically Weaker Sections, i.e. students whose annual

gross parental income is up to Rs. 4.5 lakhs. Subsidy is

admissible only once either for undergraduate or post

graduate or integrated course.

Our bank has been claiming Interest subsidy under this

scheme for all the eligible students since 2009-10 on the CSIS

portal of Canara Bank (Nodal Bank) every year. All the claims

upto 2017-18 for all years have been settled to our bank.

For the FY 2018-19, we have claimed an amount of

Rs. 65,23,633.00/- in respect of 282 education loan accounts.

Further more we also received abroad education loan subsidy

amounting to Rs. 31,55,904.00/- for 2018-19.

Bank is also a registered entity under CERSAI – Central

Registry of Securitisation Asset Reconstruction and Security

Interest of India.

Credit flow to Micro and small enterprises under Credit

Guarantee Fund Trust for Micro & Small Enterprises

(CGTMSE)

In line with the objectives of the Government, Bank has

focussed on financing to Micro and small enterprises and

Bank has an outstanding portfolio of Rs. 118 Crore under stCGTMSE as on 31 March,2020.

(Rs. in Lakhs)

Credit Information Companies

Our Bank is a member of Trans Union CIBIL (Credit

Information Bureau (India) Limited) Equifax Credit

Information Services Private Limited, Experian Credit

Information Company of India Private Limited and CRIF High

Mark Credit Information Services Private Limited.

Our Bank has been uploading the data regularly and all our

Regional Offices and Branches are accessing the credit history

of the loan applicants while making credit decisions.

Regional Manager & SM Advances Khammam participated in SHG NPA recovery drive of Pedaveedu Branch. On 15th Nov 2019. Involving SERP / IKP staff, neighbouring branch staff in the drive.

Asset Quality – Management of Non-Performing Assets

The Non-Performing Assets have marginally increased by

Rs. 9.40 Crore from Rs. 189.10 Crore as on 31st March 2019 to

Rs. 198.50 Crore as on 31st March 2020. Gross NPAs as a

percentage to total advances has come down from 1.14% as

on 31.3.2019 to 1.03 % as on 31.3.2020. Net NPAs (as a %age

to Net advances) has come down from 0.34% to Nil. During

1 Crop Loans 4965.35 3602.53 5000 4081.17

2 Total Agr & allied activities 675.77 359.83 700 748.17

3 NFS 1351.81 853.65 600 986.74

4 OPS 5267.55 4607.95 4500 4062.16

5 Tot Priority Sector 12260.48 9423.96 10800 9878.24

Achievement % 76.86% 91.46%

Cumulative 2018-19 2019-20

No of A/Cs 876 15561

Amount 957.58 11799.14


32

the financial year Bank has made 100% provisions for all the

NPA accounts and accordingly Net NPA was made Nil from

Rs. 55.62 Crore. The NPAs have come down in all segments

except KCC and recalled debts.

The movement in NPAs during last two years is as under:

st stParticulars 31 March 2020 31 March 2019

Gross NPA 198.49 189.10

Gross NPA (%) 1.03 1.14

Net NPA 0 55.62

Net NPA (%) 0 0.34

Addition to NPAs 426.90 293.46

Recovery/ Upgradations 417.50 300

Write Offs 36.73 0.55

Recovery in Written off A/cs 3.96 6.44

Provision Coverage Ratio (%) 100 70.59

SARFAESI Act and Suit filing

Notices under SARFAESI Act were issued immediately after

the account becoming NPA. This was monitored by Head

Office at monthly intervals. Our actions in this regard have

yielded good results. We have taken demonstrative actions

particularly under SARFAESI. One desk officer each has been

posted to all Regions exclusively for the purpose of monitoring

NPAs who will be responsible for initiating action under

SARFAESI, Suit Filed, vehicle seizure etc., and also closure of

suit filed cases, AUCA recovery etc. Focus was given for

recovery of Recalled debts/ Suit filed accounts. Meetings with

Advocates were conducted in regions for expediting disposal

of suits.

Performance under SARFAESI is as under: (Rs.in lakhs)

Particular

Demand Notices

Possession Notices issued

Possession taken

Auctioned

Regularized

A/cs

302

167

25

6

148

Amt

3050.71

1628.48

358.68

194.55

1478.62

Performance under Suit-filed cases is as under: (Rs. in lakhs)

Particulars

Suit filed

Decreed

EP Filed

Recovery after Filling suits

Cases

1746

970

337

155

Amt

3877.22

1851.27

942.24

279.61

Bank Adalat

We have introduced Bank Adalat scheme in line with

Lokadalat for quick disposal of overdue cases at Regional

Office level. Dates of conducting of Bank Adalat will be

advised by Head Office.

During the Year 2019-20 we have settled 2530 cases for an

amount of Rs. 688.08 lakhs.

Compromise settlements

Bank has recovered following amounts under compromise

settlement scheme: (Rs.in lakhs)

Compromise

No of A/Cs

Amount

2018-19

2099

1259.37

2019-20

972

971.99

As per asset classification, the classification of loans book is

as given below:

Asset

(Rs. in Crore)

O/s % O/s %

2018-19 2019-20

Standard 16469.31 98.86 19124.47 98.97

Sub Standard 49.54 0.30 81.39 0.42

Bad & Doubtful 121.62 0.73 116.21 0.60

Loss 7.94 0.11 0.90 0

Total NPAs 189.10 1.14 198.50 1.03

Total Advances 16658.41 100 19322.97 100

The following strategies were adopted to reduce / contain the

NPAs:

1. The Recovery & Risk Management department has been

continuously drawing various strategies for reduction of

NPAs and guiding the branches/Regional Offices under

the guidance of top Management.


33

1478.62

Provision Coverage Ratio

70

.59

%

85

.67

%

10

0.0

0 %

FY 2018 FY 2019 FY 2020

(Rs. in Crore)

2. All General Managers are regularly visiting the branches

in their allotted regions and reviewing the NPA position

and guiding for resolution.

3. More than Rs. 20.00 lakhs outstanding NPA accounts are

being monitored by Chairman personally.

4. Top 50 Loan accounts position is being placed before

Board in its every meeting and suggestions /

recommendations made by Board are being implemented.

5. As NPAs under SHG have registered increase, we have

advised the branches to ensure renewal of accounts

where the limits were expired on war footing basis and

recover the instalment amount duly utilizing the services

of VO leaders and VO wise lists.

6. Top 50 NPA accounts of each region are being reviewed by

respective GMs at frequent intervals.

7. Top management has been conduct ing audio

conferences at frequent intervals with Regional

Managers, Manager (Adv.), Desk Officers (NPAM) and

high NPA branches and reviewing NPA position.

8. In the light of recent promises by political parties to waive

crop loans up to Rs. 2.00 lakhs, renewal of crop loans has

taken back seat. As such all our branches are conducting

Gramasabhas in their area of operation. We have advised

to conduct at least four such Gramasabhas by each

branch for renewal of crop loans and SHGs.

9. Chronic NPA branches were allotted to HO officials for

monitoring and reduction NPAs up to March 2020.

10. Conducted auction for Gold ornaments pertaining to

Personal Gold Loans which became overdue, at common

date at quarterly intervals.

In addition, the Bank strengthened its stressed assets

management by revamping its NPA management

Dashboard to track daily additions / Upgradations &

launched a in house developed suit file web portal for

automation of entire process involved in filing suits for

effective monitoring of Suit file Accounts by Branches and

controllers. Further, the Bank is in the process of

developing an in house SARFAESI web portal for effective

monitoring of SARFAESI NPA accounts.

Internal Control System – Inspection & Audit (I&A)

The I&A Department, headed by a General Manager, works under the guidance and supervision of the Audit Committee of the Board & all activities of the Bank are subjected to internal audit function, which comprises of different types of audits namely (a) Risk Focused Internal Audit (RFIA) (b) Snap Audit (c) Concurrent Audit and (d) Income Audit (e) Special Audit (f) Compliance Audit (g) IS Audit.

Keeping pace with rapid digitisation, department is also actively contemplating to introduce new technological initiatives for providing enhanced efficiency and effectiveness in audit process.

Risk Focused Internal Audit (RFIA)

The Risk Focused Internal Audit Report System has been implemented in the Bank from July 2009, as suggested by our Sponsor Bank, State Bank of India. In order to strengthen the criteria to qualify for better ratings, Bank has raised the benchmark for the Inspection ratings with effect from 01.09.2011.

For further strengthening of the audit system the new format of RFIA has been introduced in the Bank w.e.f.01.10.2016 as advised by our Sponsored Bank, with the following rating system parameter-wise marks.

Revised Rating Range of Marks

Well Controlled - A+ >=850

Adequately Controlled - A >700 and <=850

Moderately Controlled - B >600 and <=699

Unsatisfactorily Controlled - C <600

The marks allotted under each parameter have also been revised as under:

S. Parameter Revised N Format -Marks

1 Business Development 100

2 Credit Risk Management 450

3 Operational Risk Management 410

4 External Compliance 30

5 Self-Audit 10

Revised reporting format of Risk Focused Internal Audit (RFIA)

has been implemented during the year, incorporating IS & IT

Risk scrutiny in it.

Branches with 'Well Controlled – A+' and 'Adequately

Controlled - A' ratings are audited within 18 months from the

previous audit date while the Branches with 'Moderately


34

Controlled - B' and 'Unsatisfactorily Controlled - C' rated

branches are audited within a year.

During the year 516 branches have fallen due for Audit and

514 branches have been audited. Rating acquired by 514

branches is as under:

Rating Out of 514 Branches

audited during 2019-20

Well Controlled - A+ 358

Adequately Controlled - A 156

Moderately Controlled - B -

Unsatisfactorily Controlled - C -

Total 514

The reports submitted by the Auditors have been dealt with by

taking corrective measures, wherever necessary. The

Department has carried out its operations with fair and

without prejudice which helped in strengthening the systems

and procedures.

Due to sustained efforts made by the department, the

percentage of Well Controlled branches (A+) have increased

from 42.6% recorded during previous FY to 69.6% in FY 2020.

Out of 607 RFIA Reports which have fallen due for closure

during the year, all the Reports have been dealt with and

closed.

Snap Audit

The schedule of Snap Audits has been advised to ROs on

monthly basis to depute Officials from Region to other Region

to carry out the Snap Audit of Branches to have effective audit

of the Branches. 907 Snap Audits have been conducted during

the year 2019-20.

Concurrent Audit

As a part of internal control system in our Bank, Concurrent

Audit is introduced from the financial year 2012-13 as per the

policy guidelines issued by NABARD. Keeping in view the staff

availability, the Concurrent Audit is being conducted at 200

branches with the help of 38 Auditors. We propose to empanel

the retired Bank Officials to cover at least 50% of the Credit

and other exposures of the Bank under Concurrent Audit

System in compliance with the guidelines issued by NABARD.

The Scope of Concurrent Audit is designed to cover (a)

handling of cash (b) safe custody of securities (c) exercise of

discretionary powers (d) sundry and suspense accounts (e)

clearing differences (f) off balance sheet items, security

aspects, verification of Assets Quality etc.

Apart from this, the following audits have also been carried

out to enhance the efficiency levels:

Income Audit

Income Leakage Audit has been conducted at 386 branches

and recovered Rs. 123 lakhs.

Special Audit

A special audit was conducted in 13 Branches for Advance

limit of Rs. 50 lakhs and above covering 78 loan accounts,

Special Assets Verification for 3 Branches in Khammam Region

were also conducted.

Compliance Audit

Compliance Audit was conducted at 53 branches during this

year as per the schedule.

IS Audit

IS Audit has been conducted at 11 Regional Offices and Head

Office including IT Cell with the help of CISA qualified retired

SBI official as per the instructions of Corporate Centre, State

Bank of India, Mumbai.

Audit of other Administrative Units:

All the eleven Regional Offices and other departments i.e.

Accounts, SLC, Stationery cell, HRMS have also been audited.

Management Audit

The Management Audit of our Bank has been conducted by

our Sponsor Bank, SBI. The audit has been concluded on

03.12.2019 and final compliance on the Auditor's key

observations/findings/remarks has been submitted to

Corporate Centre, SBI, Mumbai.

NABARD Inspection under Section 35(6) of the Banking

Regulation Act 1949

The NABARD Audit has been conducted as on 31.03.2019

during 22.07.2019 to 09.08.2019 and the Report was received

on 17.12.2019 with a Rating awarded 'A'. Compliance

submitted on 14.02.2020 and further Compliance submitted

on 18.04.2020.

Financial Inclusion

Continuing its trend, the Bank has actively taken part in

various financial inclusion activities during the year, thereby

increasing the spread of digital banking channels in the areas

which do not have any banking presence.

To enhance the reach and add convenience to the customers,


35

the bank has increased its Bank Mitras from 1867 in FY 2019 to

2056 Bank Mithras as on 31.03.2020. Of which 1867 Bank

Mitras are operating in Sub Service Areas (SSA) and 189 Bank

Mithras in Non SSA equipped with micro ATMs. They are

operating in 4444 villages in the erstwhile districts of

Khammam, Mahabubnagar, Nalgonda, Medak and Warangal

in Telangana State and Vishakhapatnam, Vizianagaram and

Srikakulam districts in Andhra Pradesh State, which do not

have any formal banking outlet. Out of 4444 villages, 825

villages are with population of 2000 and above and remaining

3619 villages with a population less than 2000.These Bank

Mithras have become an extended arm for implementation of

our Banks Financial Inclusion policy in tune with Government

of India guidelines. These Bank Mitras provide banking

Training programme for Bank Mitras and Debt Recovery Agents

at our SLC, Warangal

facilities to the people at their door steps by leveraging

technology.

The Bank Mitras use the hand held Micro ATM devices to carry

out the banking transactions in real time. The following

banking transactions are enabled at Bank Mitra Points:

a. Cash withdrawal and deposit

b. Receipt of loan instalments

c. AEPS transactions both Onus and Off us

d. RuPay Debit card transactions both Onus and Off us

e. Aadhar Seeding facility.

f. Facility of mobile number seeding to bank account.

Awarness programme conducted for Bank Mitras by Bank at Siddipet


36

Door to Door CASA Campaign by Ontimamidi Branch Staff

The entire Financial Inclusion (FI) operations at BCAs work on

the principle of Biometric verification of the beneficiaries

through micro ATMs and are online, hitting our CBS server

instantly through Third Party Integration, which facilitates

updation of transactions carried out by BCAs on real time

basis, in CBS Server, via TSPs' Servers.

The following is the total Bank Mitra Transaction and share of

transactions (%) performed at Bank Mitras when compared

with the total bank transactions

S.No Particular 2018-19 2019-20

No. of Bank Mitra transactions almost doubled during the FY

increasing from 59.47 lakhs (involving an amount of

Rs. 1820.65 Crore) to 109.17 lakhs (involving Rs. 4903.39

Crore) as on 31.3.2020 at a growth rate of 83.57%.

As at the end of the FY 2019-20, no. of SB Accounts opened

and maintained by Bank Mitras is 1066183 with a CASA

balance of Rs. 212.00 Crore compared to 911417 and balance

of Rs. 148.68 Crore as on 31.3.2019). No. of RD Accounts

opened and maintained by Bank Mitras is 7061 (with a

balance of Rs. 3.89 Crore).

Balances in Bank Mithra accounts has increased from

Rs. 148.68 Crore in FY 2019 to Rs. 212.00 Crore in FY 2020

registering a healthy growth rate of 42.58% in Bank Mithra

CASA deposits.

The average balance in Bank Mitra Accounts has also

increased from Rs. 1529.19 per account to Rs. 1986.23 as on

31.3.2020.

Mobile ATM Demonstration Van

In order to promote Digital Financial literacy, NABARD from its

Financial Inclusion Fund (FIF) providing grant assistance for

demonstration of Banking Technology through Mobile van.

The main objectives of Mobile ATM- Demonstration Van are

i. Spreading Financial Literacy

ii. Demonstration of Various digital banking technologies

for Digital Financial Literacy

iii. Demonstration of micro ATM, ATM , POS and Rupay card

transactions.

iv. To increase the activation of Rupay cards, specifically

cards issued under PMJDY.

v. Demonstration of ATM transactions. Micro ATM usage

and precautions to be taken while doing ATM

transactions.

We have procured four new Mobile ATM demo vans during

the year, two each for Andhra Pradesh and Telangana states.

The vehicle moves across all the operational districts of our

Bank in Andhra Pradesh and Telangana states by prior

scheduling of one week to ten days for each district. Our FLC

counsellors have been given charge of handling the Mobile

ATMs during the tour and utilizing it for giving demonstrations

at the time of conducting Financial Literacy camps. We are

playing videos on Financial Literacy, Social Security schemes,

PMJDY through LED TV installed in vehicle for which people

are getting attracted towards the Mobile ATM and attending

the camps for getting awareness of usage of ATM vehicle. Our

Bank Mithra sits in the Mobile ATM during the tour of vehicle

in a village and there Bank Mithra performs transactions,

likewise we are utilizing it for giving wide publicity on Bank

Mithra services & our Bank products.


37

1 FI Transactions 4974087 6232546 (19.84%)

2 AEPS ON-Us 5260057 7716063 (24.56%)

3 AEPS Acquirer OFF Us 985163 1029358 (03.27%)

4 AEPS Issuer OFF Us 2415575 3499528 (11.14%)

5 RUPAY Card transactions 98209 288744 (0.91%)

New Mobile ATM van of the Bank

inauguration of Mobile ATM van by Honourable Collector & District Magistrate, Shri J.Nivas, also attended by AGM-DD NABARD & LDM Srikakulam.

Financial Inclusion – Social Security Schemes (PMJJBY,

PMSBY & APY)

Pradhan Mantri Jeevan JyotiBimaYojana (PMJJBY)

PMJJBY is a one-year life insurance scheme, backed by

Government of India, renewable from year to year, offering

coverage for death. People in the age group of 18 to 50 years

having a Bank account who give their consent to join / enable

auto-debit, are eligible. Aadhar would be the primary KYC for

the bank account. The life cover of Rs. 2 lakhs shall be for the

one year period stretching from 1st June to 31st May and will

be renewable. Risk coverage under this scheme is for

Rs. 2 Lakh in case of death of the insured, due to any reason.

The premium is Rs. 33O per annum which is to be auto-

debited in one instalment from the subscriber's Bank account

as per the option given by him on or before 31st May of each

annual coverage period under the scheme.

We have enrolled new 183671 customers under Pradhan

Mantri Jeevan Jyothi Bima Yojana during FY 2019-20, taking

the total accounts to 517662.

Financial Literacy Awareness camp at Cheruvupally, Nalgonda.


38

Pradhan Mantri Suraksha BimaYojana (PMSBY)

PMSBY is an accident insurance scheme and offers a one-year

accidental death and disability cover, which can be renewed

annually. The Scheme is available to people in the age group

18 to 70 years with a Bank account who give their consent to

join / enable auto-debit on or before 31st May for the

coverage period 1st June to 31st May on an annual renewal

basis. Aadhar would be the primary KYC for the Bank account.

The risk coverage under the scheme is Rs. 2 lakh for accidental

death and full disability and Rs. 1 lakh for partial disability. The

premium of Rs. 12 per annum is to be deducted from the

account holder's Bank account through 'auto-debit' facility in

one instalment.

We have enrolled new 239051 customers under Pradhan

Mantri Suraksha Bima Yojana during FY 2019-20, taking the

total to 972589 accounts.

Atal Pension Yojana (APY)

APY is a pension scheme for unorganised sector workers such

as personal maids, drivers, gardeners etc., launched in June

2015 by the GoI. APY aims to help these workers save money

for their old age while they are working and guarantees

returns post retirement. Under the APY, there is guaranteed

minimum monthly pension for the subscribers ranging

between Rs. 1000 and Rs. 5000 per month, depending on the

entry age and monthly contribution.

Aadhar will be the primary KYC and all Bank Account holders

aged between 18-40 years are eligible for enrolment.

Total of 88418 enrolments were mobilised under Atal Pension

Yojana (APY) for FY 2019-20 taking the total to 202631

accounts.Surpassing a landmark figure of 200000

enrolments. Average number of enrolments per branch

under APY scheme went up to 114.08 during FY 2019-20.

nd stWe stood 2 among all the RRBs in the country and 1 among

the SBI Sponsored RRBs

Felicitation of Best performing Bank Mitras on the occasion of Women’s day in Centurion University, Perlakamidi, Odissa on 08.03.2020, attendedby Chairman Shri K Praveen Kumar and General Manager Shri P. Pardhasardhi

Digital Financial Literacy Awareness Camps (dFLAPs)

Following the need of the hour and taking cues from RBI's

policies and initiatives, our Bank launched Digital Financial

Literacy Awareness Camps to create awareness among rural

people and encourage them to use Card technology, ATMs,

micro ATMs, PoS transactions, use Mobile Banking, Mobile

Wallets and to highlight the role of Bank Mitras engaged by the

Bank. Street shows have been deployed in the villages with

the above contents so as to attract the rural customers to

upgrade their financial and technical skills. The publicity

material in the form of pamphlets, brochures and banners

were distributed during the camps to spread the message of

financial awareness among the rural people. We have

conducted 8909 camps through branches

Financial Literacy Centres (FLCs): With a prime objective to

impart financial literacy in the form of simple messages like

'why save with Banks, why borrow from Banks, why repay the

loans in time' the Reserve Bank of India has advised all the

Banks to set up one Financial Literacy Centre (FLC) each in the

operating districts of the Bank. The Bank has opened 8 such

Financial Literacy Centres in 8 districts viz., Srikakulam,

Vizianagaram, Visakhapatnam, Khammam, Warangal,

Nalgonda, Mahabubnagar and Medak in tune with the

guidelines issued by the NABARD. The Bank has posted

retired Bank staff to look after the affairs of FLCs as

counsellors. These FLCs are located at the district centres and

housed in the Regional Offices. The Financial Literacy

Counsellors have conducted 1603 Financial Literacy

Awareness Camps during the year.


39

Aadhar Enrolment and Updation Centres

Following the mandate from Government of India for all the

Banks to open Aadhar Enrolment and Updation Centres in at

least 10% of their Branch network, our Bank has initiated the

task of opening Aadhar Enrolment Centres at 76 locations to

extend the services of Aadhar enrolment and updation to the

public including our customers. Bank officials will assist in

enrolment process.148 officials have been identified to

supervise these Aadhar Enrolment Centres.

During the year, the Bank has activated all the 76 Aadhar

Enrolment and updation Centres. Customers can do new

enrolments at this centre in addition to getting modifications

to the exiting cards. For new enrolment, the Bank does not

charge any amount, while for demographic modifications such

as address, name, gender, date of birth etc., they need to pay

Rs. 50/- (incl GST) in the Branch.

Cross Selling

SBI Life Insurance

The Bank is a corporate agent of SBI Life Insurance Corporation

Limited, to meet the life insurance needs of the Bank's

customers, as part of Financial Inclusion apart from earning

non-interest income. The Bank mobilized a New Business

Premium (NBP) of Rs. 30.81 Crore and earned a commission of

Rs6.46 Crore during the FY 2019-20 vis-à-vis the NBP of

Rs. 32.08 Crore and commission of Rs. 5.54 Crore during the

year previous FY 2018-19.

SBI General Insurance

We have commenced SBI General Insurance Business during

the year 2015-16 as a Corporate Agent to market two

Insurance products viz., Group Health Insurance Scheme and

Group Personal Accidental Insurance Scheme apart from

insurance to the Assets financed by the Bank to the eligible

and willing customers. The Bank mobilized a business

premium of Rs. 25.17 Crore during the year 2019-20 vis-à-vis

Rs. 19.34 Crore business premium during the previous FY

2018-19. The Bank earned a commission of Rs. 2.99 Crore for

the year 2019-20. vis-a-vis the commission of Rs. 92 Lakhs for

the year 2018-19.

SBI Mutual Funds and SBI Credit Cards.

We have entered into Corporate Agreement with SBI Mutual

Funds and SBI cards Pvt. Ltd as corporate agent for sourcing

Mutual funds and SBI Credit cards. Required software has

been developed by C-Edge and is incorporated in Bank Core

Banking Solution software. 78 Bank staff has cleared the

National Institute of Securities Management (NISM) course

on mobilization of mutual funds and emerged as Association

of Mutual Funds (AMFI) certified employee for sourcing

business under Mutual funds.


40

Atal Pension Yojana (APY) Felicitation Program At New Delhi

Chairman Shri K. Praveen Kumar received the Award at the APY Felicitation Program in Four Categories (1) Outperformers (FY2019-20) Best performing Nodal Officer. (2) Makers of Excellence 3.0 (FY 2019-20) Best performing Chairman RRB (3) APY Leadership Capital (FY 2019-20) Best Performing Chairman RRB(4) Challengers Cup (FY201920) Award of appreciation Best performing RRB Category Large

Liability Central Processing Centre (LCPC)

LCPC Ashoknagar has been functioning in our Bank since 28

October 2013. This is a centralized system of maintaining

account opening forms of Savings Bank Account, Current

Accounts opened in branches.

The system ensures that all the key parameters of the

accounts opened are accurately keyed into CBS after thorough

verification of the KYC compliance obtained by the branches.

The images attached to the account like photographs and

signature are scanned and uploaded into CBS. The account

opening forms are safely stored centrally at Document

Archival Centre (DAC) for future use.

The Bank has added 161 more Branches under the ambit of

LCPC during the year, taking the total number of Branches to st501 as on 31 March 2020. Now LCPC Ashoknagar is

processing Account Opening forms of all Branches in

Telangana State. A total of 8.78 lakh accounts have been

processed and logically concluded during the year, taking the

total number of processed accounts to 20.88 lakhs. 42% of the

total account opening forms were processed during current

year.

Keeping in view the increasing Business & growing customer

base , Bank has sought Boards approval for opening of one

more LCPC Centre in Andhra Region to cater to the needs of

Branches situated in Andhra Region (4 regions) & for setting up

a dedicated & independent Central Clearing Processing Centre

(CCPC) at Ashoknagar. Board has passed necessary resolution

& permitted the Bank to apply for license to both the centres.

Accordingly Bank has applied for RBI License for opening both

centres & license is expected soon.

Further LCPC is also nodal point for issuing of Personalized

Cheques to the customers & it has issued 59,639 personalized

cheque books against customers request during the FY2019-

20 taking the total number of cheque books issued to

1,49,654.

Technology and Digitization

Bank continued to effectively leverage technology to deliver

enhanced customer experience& Business efficiency. Bank

has made a number of improvements to the customer

experience in the app, making it more user-friendly& secure.

We have added new sections like Debit cards hot listing, Green

PIN solution etc., to our Mobile Banking app. Our Mobile

Banking app continues to remain as one of the highest rated

apps among all RRBs in the country. During FY 2020 Bank has

achieved significant momentum in adoption of Alternate

Delivery channels.

Inauguration of Passbook kiosk machine at our Ashoknagar Branchon 02.11.2019. By Chairman Shri K. Praveen Kumar

Alternate Delivery Channels:

v Mobile Banking registrations: During the year 1,31,923

customer registred in our Mobile Banking platform

v ATM Cards issued: During the year 4,60,724 new ATM

cards were issued.

v POS Machines: During the year 417 POS machines are

installed.

v ADC transactions: Banking transactions through

Alternate Delivery Channels has been on the rise

whereby reducing the footfalls considerably in the

branches, thereby resulting in more focus on marketing

Customer using our Mobile Banking App


41

and business development. Alternate Delivery Channels

also facilitate 24 x 7 banking services at their

convenience. The raising trend of ADC transactions is

shown in the following table:

SNo

Payment Mode

2018-19 2019-20

No oftransactions

per Day

Volumeper day

No oftransactions

per Day

Volumeper day

1 CTS 1466 6.03 925 6.85

2 RTGS 138 102.17 360 325.42

3 NEFT 7291 4.02 11743 5.66

4 IMPS 1601 0.23 2861 0.86

5 POS 6900 0.86 7225 1.54

6 ATM 28746 5.47 35140 7.82

7 AEPS 31007 3.18 51414 6.19

8 MOBILE BANKING 3284 2.28 5465 5.17

9 NACH(APBS&ACH) 24478 0.15 27675 0.16

1 0 UPI 2104 1.89 56786 5.52

IT initiatives during the year

Bank has also developed numerous IT tools during the course

of year to have better monitoring over the affairs in the Bank,

thereby focussing more on business development

parameters. Some of the key IT initiatives taken up during the

year are listed below:

1. Profit and Loss, Balance Sheet Calculation Automation:

A web portal has been developed to generate the balance

sheet and profit and loss position of the bank for any given

month. These reports are generated based on the data

available in CBS and by considering all other payables

receivables position of the bank. This portal also provides

schedule wise summary for effective control on assets and

liabilities of the bank.

2. Treasury Investment Receivables Automation: A web

portal has been developed to capture all the SLR and Non-SLR

investments of the bank and calculate the interest

receivables, amortization values and profit earned on the sale

of investments on daily basis. These values are required for

arriving at profit and loss position of the bank.

3. Staff Annual Appraisal Portal: This portal has been

developed to complete the annual appraisal process of all the

staff members online. This portal enables staff members to

submit their self-appraisal and mandatory learning details.

Reporting authorities can appraise the performance of staff

working under their control. It would also facilitate reviewing

authorities to review the staff appraisals submitted by

reporting authorities. Budgets and achievements of staff in

different parameters is also captured in this portal to award

the scoring accordingly.

4. Automation of Form-A generation: This utility has been

developed for automatic generation of Form-A return in

fortnight intervals, which is required to be submitted to

NABARD.

5. Suit File Accounts Dashboard: The process of filing of suits

involves lot of correspondence between branches and

controlling offices, which causes delay in tracking and

reaching logical end. To overcome this difficulty, a web portal

has been developed for automation of entire procedure

involved in filing suits. Using this branches and administrative

offices can monitor the suit file cases effectively for quick

resolution. Court wise, Advocate wise MIS can be generated

by branches and controllers.

6. Branch Visit Portal: A web portal has been developed to

facilitate the officials who are visiting branches to report the

observations noted in the branch then and there at the

branches. The branch staff has been provided access to the

portal to respond to the noted observations. This facility

would enable the controllers to view the irregularities noted

by the visiting official and updates of corrective measures

initiated by the branch staff thereafter. Visit report

compliances can be tracked till the closure. This portal also

provides visiting official wise data and number of visits done

by an official during the financial year.

7.Advances control return: This utility is an alternative to the

manual system of sending monthly advance returns for

control to Branch manager/Regional office. On button click

submission of the maker, all the loans advanced in the

previous month will be sent to control of the checker based on

their discretionary powers and scale of finance. The list of

accounts sanctioned in branch would be shown in the portal

on daily basis so that all the advances would be controlled

online. The HO/ROs will also be able to access the control

returns by logging in with their respective user Ids.

8. Vigilance Department Portal: A web portal has been

developed to host the circulars pertaining to vigilance and

whistle blower policies. A vigilance pledge and quiz program

has been conducted to the staff members on the occasion of

Vigilance Awareness Week (28.01.2019 to 02.11.2019). It has

been targeted to extend this portal to develop the tracking of

vigilance related cases in next phase.

09. Staff Learning Centre (SLC) Automation: A web based

system has been developed for registration of trainee

employees / officials at SLC and for allotting rooms while they

enter SLC for any training program. This system would also

facilitate to carry out entry test and exit test to the trainees


42

(Rs. in Crore)

and also to obtain feedback of training from them.

10. Charges Monitoring Portal: This utility has been

developed to provide the Branch-wise / RO-wise / Bank as a

whole Charges statement web-page for the purpose of

verification by branches and monitoring by controlling offices.

This acts as a monitoring tool which displays the comparison

of charges debited in the current financial year in a

branch/office and can be used to submit charges control

returns online replacing the earlier process of manual

submission.

Some other portals launched during the course of the year are

Advanced MIS Portal, Leased Agreement Tracking System,

Online E-Notices generation, Performance Ranking Portal,

NEFT-RTGS Transactions monitoring dashboard, Contract

Labour Attendance Management System & Dashboard to

verify Cash on hand vs retention limit.

Web based CBS (Server less CBS):New web based (JAVA) CBS is

tested and implemented successfully in 208 branches during

the financial year. This eliminated the need for local servers at

branches and enhanced security.

Active Directory Services (ADS): Migration of branches from

existing workgroup environment to Domain environment is

initiated during this year and 32 branches are successfully

migrated so far. This improves the IT security at branches and

opens scope of centralized management of client systems at

branches/ offices.

Computer Security Day was observed on 30.11.2019 and an

on-line quiz is conducted to all the staff. Hand-outs were

distributed among staff to create awareness on computer

security and safe working in computerized environment.

Pamphlets are also distributed to customers in bringing

awareness on computer security.

Apart from above, Bank also took various initiatives for

educating customers to prevent them from risk of being

targeted through cyber-attacks through various channels

such as SMS, Website, FLC camps etc.

As part of DRP/ BCP, the provision of secondary connectivity

(SIM based) is introduced this year. So far 430 branches are

equipped with the said secondary connectivity with auto

switch over facility from Primary to Secondary connectivity in

case of disruptions in Primary connectivity and vice versa. In

case of any unforeseen eventuality, Bank has Disaster

Recovery Plan /Business Continuity Plan in place and their

effectiveness is periodically tested through drills.

Customer Service & Complaints handling

Bank continues to give at most priority for resolution of

customer grievances in stipulated time lines to ensure better

customer service. The Bank has put in place Complaint

handling policy to redress the grievances of the customers of

the customers and improve the quality of customer service.

The Bank has an online Complaint Management System

(CMS) Portal, through which Customers can lodge their

Complaints / Feedback in the CMS through Banks Website,

Toll-Free & by Mail.

Complaints are also received at Head Office/ Regional

Offices/Branches. These Complaints are also uploaded in CMS

Portal and customer gets an immediate automatic

acknowledgement and can keep track of the Complaint.

Nodal Officer l identified at Head Office, will direct the

Complaints to the concerned Department and / or Regional

Office for redressal. Access to the E-Complaints CMS Portal is

given to identified Officials in Regional Offices and Head

Office to ensure that each and every complaint received at all

levels is captured in the system so as to monitor the

Complaints for timely disposal.

Bank also formulated a robust Whistle Blower Policy. The

Whistle Blower Mechanism is an internal mechanism

established for staff members to report to the management,

concerns about unethical behaviour, actual or suspected

fraud or violation of bank's code of conduct without fear of

retribution.

Bank is also having dedicated toll-free to assist our customers

on any kind of issues & also for their valuable feed back on the

Banks services.

The General Manager, Inspection & Audit Department, is

designated as Principal Nodal Officer for customer complaints

in the Bank. Moreover, all regional heads are designated as

nodal officers for their respective regions. Further, the names

of respective nodal officers along with their contact numbers

are displayed in all the branches of the Bank.

All Branches are conducting customer meets every quarter

and important customers are invited & Regional Office

officials / Regional Manager preside over the meetings

depending on the availability. Furthermore, Regional Office

Officials / Head Office Officials during their surprise visits to

Branches also go through customer grievances and if any

deficiencies were observed, corrective steps will be initiated.

The status of Complaints is being put up to the Board of

Directors in every meeting for their review and information.


43

stCustomer Complaints: Status as on 31 March 2020

S.No Particulars No.

1 No. of complaints pending at the beginning of the year 07

2 No. of complaints received during FY 2019-20 576

3 Total Complaints 583

4 No. of complaints redressed during FY 2019-20 560

5 No. of complaints pending as on 31.03.2020 23*

* Out of 23 complaints, most of them were closed during the first half of April 2020.

The position of banking Ombudsman Complaints received through / from Banking Ombudsman during the year.

S.No No.

1 No. of complaints pending at the beginning of the year 5

2 No. of complaints received during FY 2019-20 82

3 Total Complaints 87

4 No. of complaints redressed during FY 2019-20 77

5 No. of complaints pending as on 31.03.2020 10*

*5 Complaints are related to ATM Transaction failures and 3 received in last week of MARCH 2020.

Right to information Act

During the period 01.04.2019 to 31.03.2020, the Bank received a

total of 192 applications under RTI Act, 2005 and all of them were

disposed off within stipulated time frame by CPIO. Further total of

20 first appeals received and disposed by the First Appellate

Authority (FAA).

Further more, two second appeals were preferred to the Central

Information Commission (CIC), New Delhi against the decisions of

FAA and they were disposed off favourably to the Bank.

Human Resource Management

The past financial year saw HR Department implement quite a

few measures to enhance the experience of employees& to

boost their morale.

Employees are the biggest assets to the Bank, keeping this in

mind Bank had implemented vacation policy to Staff as a

prudent risk mitigation and preventive vigilance measure. As

per the policy, all the confirmed officers and clerical staff are

required to be away from their regular work / office for ten

continuous working days during a financial year.

The staff strength of the Bank as at the end of FY 2019-20 is

3305, the staff strength (excluding those who exited the

Bank's service in the month of March 2020 on account of

retirements / resignations) and its composition is as under:

Cadre

March 2019 March 2020

Number % of totalStaff

Number % of totalStaff

The representation of women in total force reached 23.5%.

Bank has taken several measures to provide safe and

conducive environment for women employees such as

sabbatical leave, annual health check-up among other

initiatives.

Bank has completely automated Annual Appraisals and

launched a IT tool exclusively for this purpose. This portal

enables staff members to submit their self-appraisal and

mandatory learning details.

Internal Complaints Committee

The Bank has also put in place operational guidelines and

mechanism for effectively dealing with cases of sexual

harassment /misdeeds against women employees in sync

with the provisions of The Sexual Harassment of Women at

Workplace (Prevention, Prohibition & Redressal) Act, 2013

and constituted Internal Complaints Committees at 11

Regional Offices and Head Office to deal with the complaints

of sexual harassment to ensure safe working environment for

women employees in the Bank. We have been sensitizing the

employees of both the genders to be fostering a healthy and

conducive work environment. The number of cases received

and disposed will be placed before the Board once in 6

months.

The details of the staff who exited the Bank's service during

the year on various grounds are furnished below.


44

62.20 63.10

Officers 1977 2085

a. OS-V 10 12

b. OS-IV 61 47

c. OS-III 212 233

d. OS-II 487 550

e. OS-I 1207 1243

Office Assistants 1127 35.40 1153 34.88

Office Attendants 77 2.40 67 2.02

Total 3181 3305

Particulars

S.No. Reasons No. of Staff

1 Retirement 121

2 Resignations 67

3 Dismissed 1

4 Removed 6

5 VRS 21

6 Deceased 13

7 Terminated by SRC 1

Total 230

73% of the total staff members (Total Staff-2277), who were on stthe Bank rolls as on 31 March 2006, i.e., on the date of formation

of APGVB by amalgamation of five erstwhile RRBs, have stretired/resigned as on 31 March.2020. The ratio of staff

recruited from 2009 onwards to the staff recruited in the

erstwhile RRBs has increased gradually and now only 627

staff(~19%) is in service who have joined prior to 2009 and rest

2678 joined in the service after 2009 , which implies more than

80% of the Bank staff are either young / in the middle age group.

The average age of overall employees has come down over the styears and the average age as on 31 March 2020 stands at

36.3 years.

Manpower planning and Recruitment

The Bank has been recruiting the Staff in various cadres through

IBPS since 2009-10, as per manpower assessment and

requirement undertaken as on 31st March of every year in terms

of Thorat Committee recommendations, presently as per Mitra

committee recommendations approved by GOI.

Accordingly, based on the business volumes as on 31.3.2019, the

Bank has taken up recruitment exercise for augmentation of staff

in various cadres, including lateral recruitment of Scale-II and

Scale-III Officers in General banking and with specialization in Law,

IT, Marketing, Treasury, Agriculture, Chartered Accountants etc.

During FY 2019-20 Bank has recruited 282 Officers in various

grades including specialist officers and 124 office Assistants.

S.No. Cadre/Grade No. of Candidates recruitedduring the FY 2019-20

1 Office Assistants 124

2 Officers Scale-I 118

3 Officers Scale-II 90

4 Officers Scale-III 14

As learning is key for growth, the Bank's in house Staff

Learning Centre has been working continuously to train and

inculcate diverse and inclusive culture among staff to equip

them to handle the day to day functions well. All the

recruitments have been completed through the Common

Written Test including interviews conducted by IBPS.

Promotions

Promotion is an annual exercise & number of employees

promoted in different cadres in the promotion process for

FY2020 is tabulated below. As many as 189 staff members

have been promoted to next higher grade as under:

S.No. Scale No. of promotions

1 Scale IV to V 4

2 Scale III to IV 9

3 Scale II to III 48

4 Scale I to II 78

5 O Asst to Officer Scale -I 50

6 O Attn. to O Asst. 0

Total 189

Based on the manpower assessment as on 31.3.2019, the

vacancies to be filled by way of promotions have been arrived

at and promotions affected in terms of the RRBs

(Appointment of Officers and Employees) Rules 2017.The

Written Test required to be conducted for promotion to Office

Assistant, Officer Scale-I, Scale-II and Scale-III was conducted

by IBPS.

The Bank has fulfilled the statutory requirement of giving pre-

promotion training to all SC/ST candidates, eligible for

promotion, prior to written test. This has enabled the SC/ST

candidates to prepare themselves better, to give the written

test.

Training - Staff Learning Centre (SLC)

v APGVB SLC caters to the learning and training needs

particularly in the field of rural banking and strives to

develop skills of employees thereby enhancing

performance on the job.

v SLC designs and delivers training programs to impart

knowledge and stimulate the learning process in the

latest and emerging areas not limited to Banking,

Finance and Management.

v SLC serves as a focal point for meaningful, effective and

efficient collaborative arrangements with national and

international institutions for training and skill

development.


45

For the FY 2019-2020

No of Programme conducted

Allotted

MSME, HL & GPAB

Attended

10

254

250

No of Programmes

Allotted

Attended

Particulars of Programs

%

2242

2093

93.37%

2019-2020

55

Cadre Wise Training Arranged to Staff

Program Details 2019-2020

Officers 1189

Office Assistants 902

Office Attendants 2

Attended 2093

SC 407

ST 228

OBC 976

GEN 482

Women 433

Ex-Serv 60

S.No

External Programs

Name of the Programme TargetGroup

Allowed Attended

1 Concurrent Auditors Workshop (Contractual) AUDITORS 28 28

2 SHG-BLP- TGB, HYD Officers-TGB 30 29

3 Debt Recovery Agents for Bank Mitra FIC 75 74

During the year Bank has shifted it’s SLC functioned at

Warangal to the self-owned newly constructed spacious

premises at Sangareddy admeasuring approx. 28,000 Sq.ft

deployed to augment the training system. During 2019-2020

SLC has conducted 55 programs comprised of 2093

participants.

Chairman Shri. K. Praveen Kumar inaugurating the SLC building atSangareddy on 06.01.2020

Apart from regular programs associated to KYC, AML,

Investment Credit Portfolio, Agricultural Economics, Rural

Development, Financial Inclusion, SME Lending, Housing

Loans and other Special programs for external staff and

academic community also.

On 29.01.2020, SLC, Sangareddy has organized a session on

Financial Interventions and Socio-Economic Livelihood

activities for 45 no.'s MMGS Scale – III staff of M/s Mizoram

Grameena Bank (MGB), led by their Chairman Sri. V.Jaya

Chandra. The session has been highly interactive and

comprised of a field visit to study the functioning of the

Mandala MahilaSamakhya (MMS) in Kondapur Mandal.

About 267 separate interactions were recorded by the MGB

staff. Majority of participants comprised of active groups from

Haridaspur, Terpole & Malkapur villages.


46

Off-Site Programme NameSpecial Programmes conducted

On 20.02.2020, a team of 60 students led by Dr. Pawan Kumar

Avadhanam, PhD. (Economics), Dean of Management Studies,

Institute of Public Enterprises (IPE), an autonomous centre for

higher education have requested for and an exclusive program

has been convened in the paradigm of Rural Development and

Financial Interventions. The sessions have paved the way for a

possible MoU for scheduling future events in the area of Rural

Economics, Farm Management and Agricultural Economy

On 21.02.2020, it has been advised by NABARD that in lieu of

then urgent need to fillip the implementation of National

Rural Livelihood Mission, the Government India's flagship

Poverty Alleviation Programme, the capacity building of the

functionaries at the field level on SHG Linkage programme has

been felt increasingly necessary. Hitherto, the NABARD has

sought from APGVB to conduct a 3-Day intensive in-house th th thprogram for Telangana Grameena Bank staff 5 , 6 & 7 March

2020. Since the training requirements of the identified

bankers were adequately met, the NABARD advised that for

2020-21 more such programs may be conducted and due

customizations be done for catering to the requirements of

respective banks. Complete financial support would be

offered by NABARD for all such programs.

thPeddareddi Peta (V), Pulkal (M) - Interaction Program – 6 March 2020

Team Building Activity – TGB Participants @ Singur Village

APGVB SLC is now capacitated to execute offsite programs, on

MSME, Housing Loans & GPAB for selected HUB-Spoke

Branches and Regional Office staff in all regions to improve

high value and secured advances for diversification of

advances.


47

Staff learing centre Building at Sanga Reddy - Lecture Hall

Staff learing centre Building at Sanga Reddy - Computer Class Room

Reception Hall

Group Discussion Room for Participents Library Room

Accomadition facility for trainees (A/c Single / Double Bedroom)


48

Modern Video Conference facility

Infrastructure / Faclities provided at Staff learing Centre, Sanga Reddy

INTERNATIONAL WOMEN'S DAY CELEBRATIONS 2020 thWe have been celebrating International Women's Day on 8 March every year. This year also we organised the events to highlight

the achievements of our Women staff members on 08.03.2020 with the theme “An Equal World is an Enabled Word.”

The Bank has also deputed 67 Officers, essentially in the

higher cadres, to external training institutions like BIRD

(Lucknow), RBI (CAB, Pune), BIRD (Mangalore), MANAGE,

Hyderabad, IIBF, Hyderabad, ni-msme, Hyderabad, State Bank

International Women's Day Celebrations on 08.03.2020 at SLC Sangareddy

Almost One fourth of our workforce constitute women staff

members and they are working at all levels of hierarchy from

Branch Manager to Office Attendant and shortly, the Chief

Manager grade will also have women members by way of

promotions. As we all know, all positions in the Bank call for

leadership qualities, to be successful. As we observe there are

women staff members with abundant leadership qualities and

capable of achieving success against odds. However, while

some people exhibit leadership qualities naturally, sometimes

the working environment with competitive spirit, will offer

enough stimuli to bring out inherent / hidden leadership

qualities. Recognition of one's abilities always plays a big role

in encouraging the members to take on higher roles and

responsibilities and succeed.

On the occasion of IWD, we celebrated the achievements of

our women members with titles “Woman Leader of the Bank

under BM's category” and for other positions viz., Accountant,

Field Officer and Office Assistant by taking into account their

Profess iona l ach ievements , Persona l and Soc ia l

achievements.

We have also felicitated the Best Bank Mitra in every Region

on this occasion.

Staff welfare Measures

Mediclaim policy

In terms of Government of India letter No: F.8/1/2015-R RB

dated 20.10.2016, our Bank has implemented Medical

Insurance Scheme as per Xth Bipartite Settlement to

employees and officers along with their dependent family

members as detailed in Schedule IV. The Scheme covers

Employee + Spouse + Dependent Children + 2 dependent

Parents / parents-in-law with a Sum Insured of Rs. 4.00 lakhs

and Rs. 3.00 lakhs for Officers and employees respectively.

We have also taken a Corporate Buffer to cover additional

expenditure up to Rs. 4.00 lakhs and Rs. 3.00 lakhs for officers

and employees respectively, if the hospitalization

expenditure exceeds the sum insured. The Scheme, apart

from facilitating hassle free admission into the hospital

immediately and payment of cash, makes the settlement of

hospitalization expenses become much easier, saving

administrative time considerably. The scheme also covers

domiciliary treatment expenses up to 10% sum insured.

Around 11500 members including family members of Staff

have been covered under the Scheme.


49

Learning Centres on important subjects like high value

financing, Term Lending, SME finance, AML, ALM, KYC, RTI

Act, Treasury Management, Business Development etc. n

Enabled Word.”

Friendly Cricket match organized for staff at Khammam

Group Personal Accident Insurance Policy

As part of employee friendly measures, Bank has taken up the

initiative of Group Personal Accident Insurance Policy with the

following sum insured to create a sense of security among the

staff members and towards building loyalty to the

organization

SN Cadre Sum Insured

1. Officer Scale-III & IV Rs.10 lakhs

2. Officer Scale-I & II Rs.7.50 lakhs

3. Office Assistants Rs.5.00 lakhs

4. Office Attendants Rs.3.00 lakhs

Our Bank has been facing severe attrition causing acute staff shortage and these measures will boost the morale of the staff members.

Gratuity and Leave Encashment Fund

The Bank is maintaining adequate provisions in respect of

Gratuity and Leave encashment. The total corpus in Gratuity

fund as on 31.3.2020 is Rs. 135,34,96,626.14/- (Rupees One

Thirty Five Crore Thirty Four Lakhs Ninety Six Thousand Six

Hundred and twenty six Only)and Rs. 98,65,50,538.35/-

(Rupees Ninety Eight Crore Sixty Five Lakh Fifty Thousand Five

Hundred Thirty Eight and Thirty Five paisa only) corpus

maintained in Leave Encashment.

During the year, the total Gratuity paid to the exited Staff

stood at Rs. 25,12,08,736/- (Rupees Twenty Five Crore Twelve

Lakh Eight Thousand Seven Hundred and Thirty Six only) and

Leave Encashment paid to the staff at Rs. 9,60,22,401/-

(Rupees Nine Crore Sixty Lakh Twenty Two Thousand Four

Hundred and one Only).

Retired Employees – Welfare Measures

The welfare and comfort of retired employees' remains to be

one of the key priorities of the Bank & Bank has ensured that

all terminal benefits viz., Gratuity, Encashment of privilege

Leaves, Pension etc., to all the eligible retired staff on the date

of retirementare settled on the date of retirement of staff

members. Bank is also implementing Medical Insurance

Scheme for Retired Staff members and their spouse (Self-stFunded scheme) & as of March 31 2020, more than 750

retired employees have been covered under the scheme.

Pension Scheme

Bank has been implementing Pension scheme with effect stfrom 01 April 2018 consequent to the orders of Supreme

Court extending pension to RRB employees.

The Bank is maintaining adequate fund for payment of

Pensions to all the eligible. An amount of Rs. 206,31,78,297/-

(Rupees Two hundred and Six Crore Thirty One Lakhs Seventy

Eight Thousand Two hundred and ninety Seven Only) is

provided by the Bank to Pension fund during the FY 2019-20

based on the Actuarial Valuation report submitted by an

independent Actuary.

The total corpus in Pension Fund as on 31.03.2020 excluding

the provision amount is Rs 761,13,51,379/- (Rupees Seven

hundred and Sixty One Crore Thirteen Lakhs Fifty One

Thousand Three hundred and Seventy Nine Only).

During the year, the total Pension paid to the pensioners is

Rs. 158,85,65,836/- (Rupees One hundred and Fifty Eight

Crore Eighty Five Lakhs Sixty Five Thousand Eight hundred and

Thirty Six Only) out of which an amount of Rs. 85,78,72,122/-

(Rupees Eighty Five Crore Seventy Eight Lakh Seventy Two


50

Thousand One Hundred and Twenty Two Only) is paid towards

lump sum commutation.

Implementation of Scheme for Appointment on

Compassionate Grounds

In terms of Government of India letter F. No. 7/38/2014-RRB

dated 31.12.2018 received through NABARD letter No:

NB.IDD.RRB/1216/316 (Compassionate Appint.) /2018-19

dated 09 January 2019, revised Model scheme for

appointment on compassionate grounds as per the scheme in

Public Sector Banks circulated by IBA to CEOs of PSBs vide

letter No. CIR.HR&IR/2014-15/532/476 dated 11 August

2014, has been approved by the Board and implemented in

the Bank.

Industrial Relations

Cordial relations are being maintained with Officers

Association & Employees Union in order to facilitate the staff

to work in a congenial atmosphere, thus, leading to business

development of the Bank, both qualitative and quantitative.

The representations made by the Association & Union are

promptly addressed in order to look after the welfare of staff.

Welfare of SC/ST and OBC Employees

The Bank has maintained cordial relations with the SC/ST

Welfare Association and OBC Welfare Association and

complied with the statutory requirements as per the

directives of Govt. of India and the National Bank, Accordingly,

the Bank has held structured meetings, as per the stipulated

time lines, with the representatives of Welfare Associations.

The Bank has taken all steps to keep up the morale and

motivation of the employees.

The end of financial year witnessed the COVID-19 outbreak &

subsequent lockdown. Bank has taken all measures ensuring

essential services at the Branch level, Regional level and Head

Office level are not hampered. Bank has issued frequent

communications on DO's and DONT'S and created awareness

among the Staff & BCP was effectively implemented.

Vigilance Administration:

Vigilance administration plays a key role for every financial

institution and it is a managerial function. In the present

context as the Bank is growing in size and with the infusion of

new and young work force, which now constitute over 80% of

the total staff, vigilance plays aprominent role. Vigilance

together with sensitization to be vigilant has been the thrust

area of Bank. Chief Vigilance Officer is posted in the Bank to


51

look after the Vigilance administration. Deputy General

Manager (Vigilance), State Bank of India, Local Head Office,

Hyderabad, on a monthly periodicity reviews the vigilance

activities.

All branches having aggregate Business of above Rs. 10 crore

have formed their Preventive Vigilance Committees (PVC)

which will meet at quarterly intervals. RO PVCs at quarterly

intervals will meet to deliberate the critical issues raised in the

Branch PVC meetings. Head Office Preventive Vigilance

Committee will meet at quarterly intervals to discuss issues

raised by the RO PVCs. Officials from Vigilance Department,

State Bank of India, LHO, Hyderabad will be visiting either

Branches/Regional Offices/Head Office once in a quarter to

sensitise the staff on preventive vigilance measures. Such

meetings were conducted on 29.06.2019 at RC Puram Branch,

on 25.09.2019 at Nalgonda Branch and on 13.12.2019 at Head

Office, Warangal, where in Chief Manager from Vigilance

Department, SBI, LHO, Hyderabad participated.

State Bank of India, Vigilance Department has organised two th stdays' workshop on 20 June & 21 June 2019 for RRB officials

at SBILD, Marredpally, Secunderabad for dealing domestic

enquiries as Enquiry Officers, Presenting Officers and

Investigating Officers and our bank has deputed 9 officials.

Bank has launched Vigilance Portal on the Bank's Vikas net in

the august presence of Shri Md Shariff, General Manager,

NABARD, TSRO & Shri K Praveen Kumar, Chairman, APGVB on nd2 November, 2019 which is mainly aimed at disseminating

information on preventive vigilance activities & measures,

vigilance advisories and vigilance related activities. It also

contains all circulars issued by Vigilance Department and

information of Suspensions/Dismissals. Our Bank has also

launched online vigilance quiz for all staff for increasing

awareness about systems & procedures, other vigilance

related information.

Bank has launched its Vigilance Manual on vigilance

administration with the guidance and support of sponsor

bank.

Vigilance Awareness week:

The Vigilance Awareness week from 28.10.2019 to

02.11.2019 with the main theme “Integrity – a way of life”

was conducted with renewed fervour and with greater

participation from Head Office, Regional Offices and Branches

by displaying banners, conducting gram Sabhas, elocution


52

and essay writing competitions for school/college children

etc. All the staff members have undertaken e-pledge during

the week &1923 staff participated in online quiz. Grama

Sabhas were conducted by the branches to create awareness

among the public on anti-corruption and Preventive

Vigilance. In addition to the participation of customers, the

Bank also ensured involvement of younger generation with

more than 2000 students participating in various events

during the week.

An exclusive session on preventive vigilance is being taken by

the CVO of the Bank, in all training programmes & workshops

conducted by the bank, to sensitize all the staff members

about vigilance aspects in day to day operations.

During the FY Bank has reviewed and adopted Whistle Blower

Policy to align the policy in context with prevailing regulatory

guidelines.

Rolling out of Vigilance portal by Shri K I Shariff GM NABARD

Vigilance Awareness week Rashtriya Ekta Diwa being observed by

Sangareddy RO staff.

Vigilance Awareness week being observed Head Office, Regional Officeand at Branches

Attendance of Directors at Board Meetings during the calendar year 2019

SNo

Name of the Director WEFNo of

Meetingsheld

No ofMeetingsattended

1 Shri K. Praveen Kumar 02.02.2019 9 9

2 Non Official Director – Vacant* -

3 Non Official Director – Vacant* -

4 Reserve Bank of India

Shri Y. Rambabu 01.04.2018 9 8

5 NABARD

Shri Sukanta K. Sahoo 10.07.2019 9 6 Shri CSR Murthy 21.05.2018

6 Sponsor Bank (SBI)

Shri J Prakash Raman 30.09.2019 9 7 Shri Kasi Srinivas 16.09.2017

7 Sponsor Bank (SBI)

Shri S. Ganesan 07.09.2017 9 8

8 Govt of A.P. Sri KVV Satyanarayana 06.11.2017 9 1

9 Govt. of Telangana

Shri Rayi Ravi, Addl.Secy 27.04.2019 9 4

Shri Patil Prashant Jeevan 11.10.2016 IAS

*The term of Govt of India Nominee Directors has completed

during September 2016 and proposals were sent to Govt of

India through NABARD/SBI for fresh appointment of directors.

Fresh appointments are yet to be made by Govt of India and

presently these two posts are vacant.

During the intervening period of two Board Meetings, as and

when warranted, the Board has transacted the business by

means of Circulation of 12 agenda notes during the year 2019,

which were confirmed by the Board in its next Meeting The

Board has undergone the following changes in the

composition on account of transfer / superannuation of

officials during the year.

v Shri Sukanta K. Sahoo, Deputy General Manager,

NABARD, TSRO, Hyderabad was nominated as Director in

place of Shri CSR Murthy, General Manager, NABARD,

TSRO, Hyderabad.

v Shri Jyoti Prakash Raman, Deputy General Manager(ABU)

, State Bank of India , LHO , Hyderabad was nominated as

Director in place of Shri Kasi Srinivas , Deputy General

Manager , State Bank of India , LHO , Hyderabad.

v Shri Rayi Ravi, Addational Secretary in Finance Dept. took


53

Board

The Board of the Bank is constituted by

(1) Chairman of the Bank (Chairman of the Board)

(2) Two non-official directors appointed by Government of

India

(3) One nominee director each from Reserve Bank of India

and NABARD

(4) Two nominee directors from Sponsor Bank

(5) Two nominee directors from state Government of A.P./

Telangana.

Board Meeting Rules stipulate that the Board meets minimum

six times a year, at least once in a quarter. As against the

stipulated minimum number of six meetings, Board met 9

times during the calendar year.

Minimum quorum for the Board Meeting to transact business

is four directors and no meeting was adjourned for want of

quorum.

Adequate notice is given to all directors to schedule the Board

Meetings, agenda and detailed notes on agenda were sent at

least seven days in advance and a system exists for seeking

and obtaining further information and clarifications on the

agenda items before the meeting and for meaningful

participation at the meeting.

ATTENDANCE AT BOARD MEETINGS

The Board / Committee Meetings are convened by giving

appropriate notice well in advance. The Directors / Members

are provided with appropriate information in the form of

agenda items in a timely manner, to enable them to

deliberate on each agenda item and make informed decisions

and provide appropriate directions to the Management in this

regard. Majority decision is carried through while the

dissenting members' views are captured and recorded as part

of the minutes.

Video-conferencing facility or other audio visual means are

also provided at the Board / Committee meetings in case any

director is unable to physically remain present at the

meetings but wishes to participate in the meetings.

_________________________________________________

Dates of the Board Meetings held during the year:

13.02.2019, 12.04.2019, 03.05.2019, 07.06.2019,

18.07.2019, 14.08.2019, 27.09.2019, 15.11.2019,

24.12.2019.

transparency in the Bank's accounts and adequacy of

accounting controls to address the risks faced or likely to be

faced by the Bank.

v Financial position – Balance Sheet and Profit & Loss

Account statement

v Position of house keeping and Inter Office reconciliation

(BCGA) and outstanding entries.

v Certification of holding securities as reported to the RBI

every quarter by Concurrent Auditor.

v Bank's participation in treasury transactions

v Status of frauds surfaced etc.

Fraud Monitoring Committee

Fraud Monitoring Committee, a sub-committee of the Board,

constituted in terms of NABARD guidelines, met three times

during the year and reviewed the fraud cases and suggested

expediting the closure of the cases.

Special Review Committee

As per Service regulations of Officers and Employees of the

Bank, a Special Review Committee has met one time during

the Calendar Year 2019-20 and took up review of the

performance of the officers who completed 55 years of age or

30 years of service and took a view for extension of service up

to superannuation or to decide further review in a future date

before superannuation.


54

Acknowledgements

The Board of Directors of the Bank would like to express

their sincere gratitude for the continued trust and

patronage received from the customers who have stood

with the Bank all through. The feedback received from

customers by way of suggestions / complaints/ interactions

during the meetings on the service element have helped

the Bank to take corrective measures and new initiatives to

improve our efficiency levels.

The Board takes immense pleasure in expressing their

gratitude for the guidance and cooperation received from

the Sponsor Bank, Government of India, both the state

Governments Telangana and Andhra Pradesh, Reserve

Bank of India, NABARD, other Financial Institutions and

Banks for their unflinching and valuable support to the

Bank from time to time.

charge as Telangana State Government Nominee

Director replacing Shri Patil Prashant Jeevan, IAS,

Magistrate and District Collector, Warangal.

The Bank places on record the invaluable services rendered by

the Director Shri Kasi Srinivas, Deputy General Manager, State

Bank of India , Shri CSR Murthy, General Manager, NABARD,

TSRO, Hyderabad and Shri Patil Prashant Jeevan, IAS,

Magistrate and District Collector, Warangal as Director on

Bank's Board.

Sub-Committees of the Board

Audit Committee of the Board

The Audit Committee, constituted with one SBI-nominee-

director as Chairman and nominee directors of RBI, NABARD

and Govt. of India as members has met 3 times during the year

and reviewed the following areas:

v Position of Conducting of different Audits

v Common irregularities observed in (a) Risk Focused

Internal Audits (b) Snap Audit Reports (c) Concurrent

Audit.

v Audit of Regional Offices, Accounts Department at Head

office

v Special Audits

v Review and follow-up action on the Internal Audit Reports,

particularly of “Unsatisfactory” branches and large

branches and also on Concurrent Audit observations.

v Follow-up action on irregularities pointed out by Internal

Auditors at large branches in RFIA and in the Concurrent

Audit Reports.

v Branches where audit rating is downgraded.

v Compliance for NABARD inspection Report, Statutory

Audit Report, Management Audit, RFIA, Snap Audit

reports, Concurrent Audit reports, Bank Mitra Audit

Report.

v Fixing accountability for unsatisfactory compliance of

Audit reports delay in compliance and non-rectification of

deficiencies.

v Review on omissions on the part of Internal Inspecting

Officials/ Concurrent Auditors to detect serious

irregularities which come to light later

v Periodical review of the accounting policies/systems

controls in the Bank with a view to ensuring greater

Apart from our customers, the support received from the

Government Departments / Institutions of both Telangana

and Andhra Pradesh States was immense and augmented

our resources. The Board wishes to thank Telangana State

Co-operative Apex Bank Limited (TSCAB), the Andhra

Pradesh State Co-operative Apex Bank Limited (APCOB),

The Advocates Mutually aided Co-operative Society

Limited (MACS Society), Hyderabad, Pollution Control

Boards three Nidhi Credit Co-Op Federation Ltd, Marked,

Industrial Development Corporations and Endowments

Departments of both Telangana and Andhra Pradesh States

for their patronage.

The Board extends its heartfelt gratitude to M/s Rao &

Kumar, the Central Statutory Auditors of the Bank and

other Statutory Branch Auditors for their cooperation in

completing the Audit of the Bank's Financial Year 2019-20

in time.

The Board also expresses its gratitude to all Public

Relations Officers, Print and Electronic media for their

cooperation in giving wide publicity for the Bank. The

Board also thanks the Officers Association, Employees

Union and SC/ST/OBC Welfare Associations for their

constructive role played in overall development of the

Bank.

Bank also wish to place on record their appreciation of

employees for their commendable efforts, teamwork and

professionalism in taking the Bank's business upward and

Bank's image forward. The total dedication exhibited by

the employees has put the Bank on top and they deserve

all appreciations and accolades from all stake holders.

55


For and on behalf of Board of Directors of


(K. Praveen Kumar)Chairman

Further, the Board would like to convey its gratitude to Shri

Dinesh Khara, MD, State Bank of India, Corporate Centre,

Mumbai, Shri S.P. Singh, Chief General Manager (A&S), SBI,

Corporate Centre, Shri S. Ganesan, General Manager

(RRBs), SBI, Corporate Centre and all the team members in

A&S Department, SBI, Corporate Centre Mumbai. The

new initiatives introduced by the Corporate Centre to

enhance the capacity building of the Staff and to increase

the business development and business reengineering by

way of setting up of AMHs have proved to be extremely

useful in taking this Bank forward. The Bank is indebted to

these executives for their constant hand holding.

We will be failing in our duty if we do not acknowledge the

help extended by NABARD and State Bank of India, Local

Head Office, Hyderabad in sparing their Officers to be

members of the Selection Committees constituted for

promotions.

The Board conveys its gratitude to Shri Subrata Das,

Regional Director, Reserve Bank of India, Hyderabad; Shri.

T. Srinivasa Rao, Banking Ombudsman, RBI, Hyderabad for

their support. The Board also acknowledges the great

support and affectionate guidance from Shri Vijay Kumar,

Chief General Manager, NABARD TSRO and his team of

General Managers Shri B.K. Mishra, Shri K.I. Shariff and Shri

S. Selvaraj, Chief General Manager, NABARD, APRO, Officer

in Charge Shri P N Praveen Kumar, CGM and General

Manager Shri Prabhakar Behera.

The Board also expresses sincere thanks to all the District

Collectors, Project Directors of DRDA, IKP, DWMA,

SC/ST/BC Minorities and Housing Corporations of all the

districts in Telangana and Andhra Pradesh where our Bank

is operating, for their support and encouragement.

The Board would like to gratefully acknowledge the

support rendered by our Technology Service Providers viz.,

M/s C-Edge Technologies, Mumbai, M/s National

Payments Corporation of India, M/s Irix Technologies and

Accordingly Gram Tarang Inclusive Development Services

Pvt Ltd (GTIDS).

we are with you!

in the Press

56

Annual Report 2019-20

Balance Sheet

Profit & Loss A/c

Schedules

Notes to Accounts

Performance in Figures

57


58

INDEPENDENT AUDITORS' REPORTRao & Kumar

Chartered AccountantsTo

The Shareholders


Report on the Financial Statements

Qualified Opinion

1. We have audited the accompanying financial statements of Andhra Pradesh Grameena Vikas Bank (“the Bank”) as at March 31,

2020, which comprise the balance sheet as at March 31, 2020, the statement of Profit and Loss and the statement of cash flows

for the year then ended, and a summary of significant accounting policies and other explanatory information. Incorporated in

these financial statements are the returns of:

i. The Head Office and 39 Branches audited by us;

ii. 403 Branches audited by Other Auditors

The branches audited by us and those audited by other auditors have been selected by the Bank in accordance with the

guidelines issued to the Bank by the National Bank for Agriculture and Rural Development (NABARD). Also incorporated in the

Balance Sheet and the Profit and Loss Account are the returns from 333 branches (including other accounting units) which have

not been subjected to audit. These unaudited branches account for 25.00% percent of advances, 25.05% percent of deposits,

and 18.64% percent of interest income and 17.50% percent of interest expenses.

In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of

the matter described in the Basis for Qualified Opinion section of our report:

i. The Balance Sheet, read with the significant accounting policies and the notes thereon is a full and fair Balance Sheet

containing all the necessary particulars, is properly drawn up so as to exhibit a true and fair view of state of affairs of the Bank as

at March 31, 2020in conformity with accounting principles generally accepted in India;

ii. The Profit and Loss Account, read with the significant accounting policies and the notes thereon shows a true balance of

profit in conformity with accounting principles generally accepted in India, for the year covered by the account; and

iii. The Cash Flow Statement gives a true and fair view of the cash flows for the year ended on that date.

Basis for Qualified Opinion

2. The onset and rapid propagation of COVID-19 has caused disruptions in the banking operations, restrictions on travel,

meetings and access to client locations and other practical difficulties resulting in Distance Audit / Remote Audit / Online Audit.

Further, certain regulatory measures were announced by RBI to mitigate the burden of debt servicing brought about by

disruptions and to ensure the continuity of viable businesses. We were unable to physically verify relevant information, items,

documents and records. As a result, we were unable to determine whether any adjustments were necessary in respect of the

bank's assets that it controls, its liabilities for which it is responsible, its income and expenses for the year, and the cash flow

statement.

We conducted our audit in accordance with the Standards on Auditing (SAs) issued by ICAI. Our responsibilities under those

Standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report.

We are independent of the Bank in accordance with the code of ethics issued by the Institute of Chartered Accountants of India

together with ethical requirements that are relevant to our audit of the financial statements, and we have fulfilled our other

ethical responsibilities in accordance with these requirements and the code of ethics. We believe that the audit evidence we

have obtained is sufficient and appropriate to provide a basis for our opinion.

59


Key Audit Matter How it has been addressed

Impact of COVID-19 :

The onset and rapid propagation of COVID-19 has caused

disruptions in the banking operations, restrictions on travel,

meetings and access to client locations and other practical

difficulties resulting in Distance Audit / Remote Audit /

Online Audit. Further, certain regulatory measures were

announced by RBI to mitigate the burden of debt servicing

brought about by disruptions and to ensure the continuity of

viable businesses.

Considering the nature of the restrictions, limitations,

regulatory requirements, existing business environment,

materiality and their possible impact on the operative

effectiveness on the critical control systems and risk of

material misstatement the audit requires significant efforts

in verification, planning and performing alternative

procedures and exercise of more professional scepticism

tomitigate identified risks / weakness and ensure

compliance with Standards on Auditing. Further, this is a

matter of high importance for the intended users of the

financial statement. Considering these aspects, we have

considered this as a Key Audit Matter.

Our Procedure:

Though the methodologies of conducting audit are likely to

undergo a change, the objective of the audit does not change,

which require the auditors to ensure that sufficient

appropriate audit evidence is available with the auditor based

on which he is able to express his opinion.

In Identifying and Assessing the Risks of Material

Misstatement and operating effectiveness of critical controls

through Understanding the Bank and its Environment the

following issues had been considered:

1) Operational disruption resulting in any changes to the

business model.

2) Employee's absence or work from home.

3) Restrictions on travel.

4) Access to Systems, Data, Documents, Officials.

5) Inability to physically verify relevant information, items

and records.

Specific Considerations adopted while conducting Distance

Audit / Remote Audit / Online Audit of Bank Branch under

current Covid-19 situation :

1) Obtaining the data / documents required for the purpose

of conducting the audit in soft copy / scanned format.

2) Arrangement of visit to Nearest Branch / Central

Processing Cells (CPCs) or to make the files maintained at

CPCs available at the branch.

3) Seek support for presence of requisite branch officials.

4) Communications by email instead of physical mode

wherever necessary.

Adopting the SOPs under Covid-19 situation and strictly

complying with the government regulatory guidelines

issued.

Emphasis of Matter

3. We draw attention to Schedule 18 (II) (12)to the financial

statements, which describe the possible impact

ofCovid19,policies adopted and disclosures required

under the relevant Circulars issued by RBI. Our opinion is

not modified in respect of this matter.

Key Audit Matters

4. Key audit matters are those matters that, in our


60

professional judgment, were of most significance in

our audit of the financial statements for the year

ended March 31, 2020. These matters were addressed

in the context of our audit of the financial statements

as a whole, and in forming our opinion thereon, and we

do not provide a separate opinion on these matters.

Key Audit matter How it has been addressed

Verification of Advances:

Advances constitute 55.03 % of the bank's total assets.

The carrying value of these advances (net of provisions) may

be materially misstated if individual or collective income

recognition, classification and provisions are not

appropriately identified and estimated as per RBI guidelines.

Identification of performing and non-performing assets,

involves establishment of proper mechanism. The Bank

accounts for all the transactions related to advances in its

Information Technology System called Core Banking Solution

(CBS). Further, NPA stamping and provisioning is also done in

the CBS. Considering the nature of the transactions,

regulatory requirements, existing business environment,

and the materiality, audit of advances require significant

efforts in verification of the income recognition, asset

classification and provisioning. Further, it is a matter of high

importance for the intended users of the financial statement.

Considering these aspects, we have considered this as a Key

Audit Matter.

Our Procedure:

We have tested the design and operation of CBS to ensure

that IT system is designed in line with the Master Circular on

IRAC norms and other related circulars issued by RBI/

NABARD and internal policies developed by the Bank in

accordance with such Norms, including:

The accuracy of the data input in the system used for income

recognition, asset classification and provisioning in

accordance with RBI regulations

Business Logics/Parameters are in-built in CBS for Tracking,

Identification and Stamping of NPA.

Existence and effectiveness of monitoring mechanisms like

Internal Audit, Systems Audit, Snap audit and daily

Concurrent Audit.

We have examined :

The Reports, MOCs and certificates issued by the Branch

Auditors have been considered including observations made

in the LFAR. Observations, if any, by various audits conducted

as per the monitoring mechanism of the bank including

NABARD Inspection and how they have been dealt with.

Our audit procedures included considering the

appropriateness of the Banks's accounting policies and

assessing compliance with the policies in terms of the

applicable accounting standards. We have examined the

efficacy of various internal controls over advances to

determine the nature, timing and extent of the substantive

procedures. We performed test of controls over asset

classification with specific focus on whether IRAC norms are

followed adequately along with the provisioning

requirements.

In carrying out substantive procedures, we have examined all

large advances while other advances have been examined on

a sampling basis. All the stressed accounts of significant

amount have been examined in detail.

Large numbers of Branches are being audited by the

Statutory Branch Auditors who are firms of Chartered

Accountants included in the panel of NABARD and appointed

by the Bank. We have made, among others, specific

communication to the Branch Auditors to examine the

advances. We have relied on the various returns relating to

advances audited by these Statutory Branch Auditors and

there report in respect thereof.


61

Key Audit matter How it has been addressed

Provision for Pension:

The bank has provided under a Defined Benefit Plan for

pension of all the eligible employees. The pension liability is

reckoned based on an independent actuarial valuation

carried out and bank makes such initial contributions,

periodically to the fund as may be required to secure

payment of the benefits under the pension regulations. The

cost of providing defined benefits is determined using the

Projected Unit Credit Method, with actuarial valuations

being carried out at each balance sheet date.

The measurement of provision being complex, requiring

significant professional judgement and estimation in the

selection of requisite long-term assumptions and any

deficiency / error in such assumptions may result in

inaccurate valuation as per AS 15 and consequent significant

impact on the Financial Assertions, in view of the same we

consider this to be a key audit matter.

Our Procedure:

The bank has a HRMS package in place where details of

employees such as Name, Date of Birth, Date of Joining, Basic

Pay and other relevant information are being maintained.

Details of all the eligible employees have been considered

from such package and are forwarded to registered actuarial

valuer along with assumptions for actuarial valuations.

We have verified the mechanism in place to ensure

completeness of the employee data shared for valuation.

Further, we have reviewed the experts' assessment of the

appropriateness and reasonableness of the assumptions

submitted by the bank in relation to such valuation and for

matters involving significant professional judgement; we

have relied upon the methodologies adopted by the

Actuarial Expert as suggested in “SA 620 – Using the Work of

an Expert”.

Responsibility of the Management and those charged with Governance for the Financial Statements

1. The Bank's Board of Directors is responsible for preparation of these financial statements that give a true and fair view of the

financial position, financial performance and cash flows of Bank in accordance with the applicable provisions of Regional Rural

Bank Act, 1976, Banking Regulations Act,1949, applicable guidelines of Reserve Bank of India (RBI) / NABARD accounting

principles generally accepted in India, including the Accounting Standards issued by Institute of Chartered Accountants of

India(ICAI).This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of

the Act for safeguarding of the assets of the Bank and for preventing and detecting frauds and other irregularities; selection

and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and

design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring

the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial

statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Bank's ability to continue as a going

concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless

management either intends to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.

Auditor's Responsibility for audit of financial statements

2. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material

misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance

is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material

misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the

aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these

financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism

throughout the audit. We also:


62

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and

perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a

basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting

from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal

control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related

disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit

evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the

bank's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw

attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to

modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However,

future events or conditions may cause the bank to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether

the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit

and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements

regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to

bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance

in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in

our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare

circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing

so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matters

7. We did not audit the financial statements / information of 333 branches included in the standalone financial statements of the

Bank whose financial statements / financial information reflect total advances of Rs. 4,830.80 Crore as at March 31, 2020 and

total revenue of Rs. 558.85 Crore (Interest on advances and Commission income) for the year ended on that date, as

considered in the standalone financial statements. The financial statements / information of these branches have been

audited by the branch auditors whose reports have been furnished to us, and in our opinion in so far as it relates to the

amounts and disclosures included in respect of branches, is based solely on the report of such branch auditors.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

8. The Balance Sheet and the Profit and Loss Account have been drawn up in Forms “A” and “B” respectively of the Third Schedule

to the Banking Regulation Act, 1949.

Subject to the limitations of the audit indicated in paragraph 2 to6 above and subject to the limitations of disclosure required

therein, were port that:

a. We have obtained all the information and explanations which to the best of our knowledge and

belief, were necessary for the purposes of our audit and have found them to be satisfactory.

b. The transactions of the Bank, which have come to our notice, have been within the powers of the Bank.

c. The returns received from the offices and branches of the Bank have been found adequate for the

purposes of our audit.


63

d. The Balance Sheet and the Profit and Loss Account dealt with by this Report are in agreement with

the books of account and the Returns.

e. In our opinion, proper books of account as required by Law have been kept by the Bank, so far as

appears from our examination of those books

f. The Reports on the financial statements of the Branches audited by the Branch Auditors have been

dealt with in preparing our Report in the manner considered necessary by us.

In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement comply with the applicable accounting

standards, to the extent they are not inconsistent with the accounting policies prescribed by RBI

Place: Hyderabad

Date: 10.05.2020

For RAO & KUMARChartered Accountants

FRN: 003089S

CA K S Vamsi KrishnaPartner

MNO: 229988UDIN No.


64

(Rs in '000s)st

Balance Sheet As At 31 March 2020

Andhra Pradesh Grameena Vikas BankHead Office: Warangal

As per our report of even dateFor Rao & Kumar Chartered AccountantsFR No: 003089S

For Andhra Pradesh Grameena Vikas Bank

(CA. K S Vamsi Krishna) (Ch Sree Rama Somayaji) (K. Praveen Kumar)

Partner General Manager Chairman

M No : 229988

Place: Warangalth

Date: 10 May 2020

(Y Rambabu) (Sukanta K Sahoo) (Dinkar Argal)Director Director Director

(Bhuvanendra Takoor) (Satyanarayana, IRAS) (R Ravi)

Director Director Director


65

Particulars Sch. As on 31.03.2020 As on 31.03.2019

CAPITAL AND LIABILITIES

Capital 1 94 08 50 94 08 50

Reserves & Surplus 2 2904 94 82 2286 76 34

Deposits 3 18495 69 07 16055 95 57

Borrowings 4 8465 87 52 6471 00 50

Other Liabilities & Provisions 5 1315 60 44 1729 63 51

Total 31276 20 35 26637 44 42

ASSETS

Cash and balances with RBI 6 634 79 82 810 94 53

Balances with Banks and Money at Call

& Short Notice 7 8172 26 70 4494 80 13

Investments 8 3838 85 34 5392 30 59

Advances 9 17234 46 95 14834 92 68

Fixed Assets 10 68 49 86 59 86 67

Other Assets 11 1327 31 68 1044 59 82

Total 31276 20 35 26637 44 42

Contingent Liabilities 12 68 15 65 31 54 37

st Profit & Loss for the year ended 31 March 2020 (Rs in '000)



Particulars Sch. Year Ended 31.03.2020 Year Ended 31.03.2019

1 Interest Earned 13 2603 51 33 2369 37 59

a. Interest/Discount on Advances/bills 1972 97 85 1728 79 81

b. Interest on Investments 329 61 35 398 81 15

c. Interest on Balances with RBI and Other

Inter Bank Funds Nil Nil

d. Interest on TDRs with Banks 300 92 13 241 76 63

II Other Income 14 409 93 00 287 95 22

a. Commission, Exchange and Brokerage 253 15 84 237 39 44

b. Miscellaneous Income 156 77 16 50 55 78

III TOTAL 3013 44 33 2657 32 81

IV Interest Expended 15 1390 47 25 1322 92 94

V Operating Expenses (a + b) 16 409 95 06 376 22 99

a. Employees Costs 272 26 33 266 19 18

b. Other Operating Expenses 137 68 73 110 03 81

VI Total Expenditure

(excluding provisions and Contingencies) ( 4+5) 1800 42 31 1699 15 93

VII Operating Profit before provisions and

Contingencies (3-6) 1213 02 02 958 16 88

VIII Provisions (other than tax) and Contingencies 319 61 99 807 57 07

IX Profit from Ordinary Activities before Tax (7-8) 893 40 03 150 59 81

X Tax Expense

a. Provision for Taxation-Current Year (276 92 88) (45 00 00)

b. Deferred Tax Asset 1 10 16 (43 71)

c. Earlier Years Adjustments (Excess) Nil 6 87 74

XI Net profit for the period from Ordinary

Activities after Tax 617 57 31 112 03 84

66

(Rs in '000s)

Particulars Sch. Yr Ended 31.03.2020 Yr Ended 31.03.2019


APPROPRIATIONS

Net Profit for the period 617 57 31 112 03 84

Add: Brought forward Profit 1786 49 56 1700 95 29

Add: Excess Provision written back 61 17 Nil

Transfer to the Statutory Reserves 123 51 46 22 40 77

Transfer to the Capital Reserves 1 10 918 Nil

Special Reserve u/s 36(1)(viii) of IT Act, 1961 24 54 24 4 08 80

Profit Carried Over to Balance Sheet 2245 53 16 1786 49 56

Summary of Significant Accounting Policies 17

Disclosures and Notes to Accounts 18

67





M No : 229988

Place: WarangalthDate: 10 May 2020




SCHEDULE – 1 CAPITAL

st Schedules forming Part of Balance Sheet As on 31 March 2020

(Rs in '000’s)


Head Office: Warangal


68

Particulars As on 31.03.2020 As on 31.03.2019

Authorised Capital 2000,00,00 2000,00,00

(200,00,00,000 Equity Shares of Rs.10/-each)

Issued Capital 94,08,50 94,08,50


Subscribed Capital 94,08,50 94,08,50


Called up Capital 94,08,50 94,08,50


Less: Calls Unpaid NIL NIL

Add: Forfeited Shares NIL Ni l

TOTAL 94,08,50 94,08,50



SCHEDULE – 2 - RESERVES AND SURPLUS


(Rs in '000s)


I. Statutory Reserve

Opening Balance 455 48 91 433 08 14

Additions during the Year 123 51 46 22 40 77

Deductions during the Year Nil Nil

TOTAL 579 00 37 455 48 91

II. Capital Reserve

Opening Balance 1 20 1 20

Additions during the Year 11 09 18 Nil


TOTAL 11 10 38 1 20

III. Share Premium

Opening Balance Nil Nil

Additions during the Year Nil Nil


TOTAL Nil Nil

IV. Revenue and other Reserve


Additions during the Year Nil Nil


TOTAL 14 31 49 14 31 49

V. Special Reserve u/s 36(1)(viii) of Income Tax Act,1961


Additions during the Year 24 54 24 4 08 80


TOTAL 39 00 76 14 46 52

VI. Investment Fluctuation Reserve


Additions during the year Nil 12 88 11

Deduction during the year Nil Nil

Total 15 98 66 15 98 66

Balance in Profit and Loss Account

Opening Balance 1786 49 56

Additions During the year 61 18

Profit for the year 458 42 42

TOTAL 2245 53 16 1786 49 56

Grand Total 290 94 82 2286 76 34

69

SCHEDULE – 3 - DEPOSITS

SCHEDULE – 4 - BORROWINGS

(Rs in '000s)

(Rs in '000s)





A. I. Demand Deposits

i) From Banks 1 19 81 Nil

ii) From Others 158 64 04 186 14 30

II. Savings Bank Deposits 7195 92 99 6469 96 96

III Term Deposits

i) From Banks 1628 93 05 745 57 92

ii) From Others 9510 99 18 8654 26 39

TOTAL 18495 69 07 16055 95 57

B. i) Deposits of Branches in India 18495 69 07 16055 95 57

ii) Deposits of Branches Out Side India Nil Nil

TOTAL 18495 69 07 16055 95 57


I. Borrowings in India

i) Reserve Bank of India Nil Nil

ii) Other Banks 1346 42 40 2 12 83

iii) Other Institutions (NABARD,NHB & MUDRA)

a) NABARD 7066 31 23 6376 07 97

b) NHB 53 13 89 72 79 70

c) MUDRA Nil 20 00 00

II. Borrowings Outside India Nil Nil

TOTAL 8465 87 52 6471 00 50

70

SCHEDULE – 6 - CASH AND BALANCE WITH RESERVE BANK OF INDIA(Rs in '000s)

SCHEDULE – 5 OTHER LIABILITIES AND PROVISIONS

(Rs in '000s)





I Bills payable/Bankers Cheque 90 80 73 116 07 55

II Inter Office Adjustments (Net) 46 06 1 83 85

III Interest Accrued on Deposits 546 63 36 544 44 31

IV General Provisions:

a) Provision on Standard Assets 58 61 10 49 02 93

b) Standard Assets Provision-created on account of

moratorium 98 82 Nil

c) Frauds Provision 5 47 6 15

d) Audit Fee Provisions 84 00 80 00

e) Income Tax Provision 276 92 88 45 00 00

f) Pension Contribution fund provision 206 31 78 831 87 07

g) NPS Provision Nil 5 79 45

V Interest payables 57 30 27 74 41 86

VI TDS on Bank Term Deposits 9 01 73 9 13 48

VIII Deferred Taz Nil Nil

VIII Other Liabilities 67 64 24 51 16 86

TOTAL 1315 60 44 1729 63 51


I. Cash in Hand 104 04 90 149 93 45

II. Balances with Reserve Bank of India

i) In Current Account 530 74 92 661 01 08

ii) In Other Account NIL NIL

TOTAL 634 79 82 810 94 53

71

SCHEDULE – 7 - BALANCE WITH BANKS AND MONEY AT CALL & SHORT NOTICE(Rs in '000s)





I. In India

i. Balance with Banks

a) In Current Accounts 41 04 75 7 44 33

b) In Other Deposit Accounts (TDRs) 81312195 4487 35 80

ii. Money at Call & Short Notice

a) With Banks Nil Nil

b) With Other Institutions Nil Nil

TOTAL 8172 26 70 4494 80 13

II. Outside India

a) In Current Accounts Nil Nil

b) In Other Deposit Accounts Nil Nil

c) Money at Call & Short notice Nil Nil

TOTAL Nil Nil

TOTAL (I&II) 8172 26 70 4494 80 13

72

SCHEDULE – 8 - INVESTMENTS (Rs in '000s)





I Investment in India

i) Government Securities 3753 85 35 5317 05 60

ii) Other Approved Securities Nil Nil

iii) Shares Nil Nil

iv) Debentures and Bonds Nil Nil

v) Subsidaries and /or joint Ventures Nil Nil

vi) Investment in Equity shares of National

Payment Corporation of India (Long Term) 24 99 24 99

vii) Others 84 75 00 75 00 00

TOTAL 3838 85 34 5392 30 59

II Investments Outside India

i) Government Securities Nil Nil

(Including Local Authorities) Nil Nil

ii) Subsidiaries and/or Joint Ventures Nil Nil

iii) Other Investments (To Be Specified) Nil Nil

TOTAL Nil Nil

TOTAL (I&II) 3838 85 34 5392 30 59

73

SCHEDULE – 9 - ADVANCES(Rs in '000s)





A. 1. Bills Purchased and Discounted Nil Nil

2. Cash Credits, Overdrafts and Loans

Repayable on Demand 12364 79 42 11222 27 26

3. Term Loans 4869 67 53 3612 65 42

TOTAL (A) 17234 46 95 14834 92 68

B.1. Secured by Tangible Assets 17234 46 95 14780 12 50

2. Covered by Bank / Government Guarantees Nil Nil

3. Unsecured Nil 54 80 18

TOTAL (B) 17234 46 95 14834 92 68

C.I. Advances in India

1. Priority Sector 15486 53 15 12714 73 40

2. Public Sector Nil Nil

3. Banks Nil Nil

4. Others 1747 93 80 2120 19 28

TOTAL (C.I) 17234 46 95 14834 92 68

C.II. Advances Outside India

1. Due from banks Nil Nil

2. Due from Others Nil Nil

TOTAL (C.II) Nil Nil

GRAND TOTAL (C.I+C.II) 17234 46 95 14834 92 68

74

SCHEDULE – 10 - FIXED ASSETS (Rs in '000)





I. Land

At cost as on the 31st March of the Preceding Year 9 57 9 57

Additions During the Year Nil Nil

Deductions During the Year Nil Nil

TOTAL 9 57 9 57

II. Buildings

At cost as on the 31st March of the Preceding Year 161 60 1 57 28

Additions During the Year 8 47 49 4 32

Deductions During the Year Nil Nil

st Depreciation as on 31 March of the preceding year 5 00 2 24

Depreciation during the year 6 90 2 77

TOTAL 9 97 19 156 59

III. Other Fixed Assets (including Furniture and Fixtures)

At cost as on the 31st March of the Preceding Year 128 46 54 120 39 77

Additions During the Year 18 67 57 10 13 34

Deletions During the Year 3 15 18 2 06 57

Depreciation upto the preceding year 78 83 65 70 28 19

Depreciation during the year 10 51 87 9 67 77

Depreciation on deletions 2 56 09 1 12 31

TOTAL 57 19 50 49 62 89

IV. Capital Work in Progress

At cost as on the 31st March of the Preceding Year 8 57 61 5 52 25

Additions During the Year 67 08 3 05 37

Deletions During the Year 8 01 09 Nil

TOTAL 1 23 60 8 57 62

TOTAL (I+II+III+IV) 68 49 86 59 86 67

75

SCHEDULE – 11 - OTHER ASSETS(Rs in '000s)



SCHEDULE – 12 - CONTINGENT LIABILITIES (Rs in '000s)



1. Inter Office Adjustments (Net Nil Nil

2. Interest Accrued on investment 252 50 41 187 02 10

3. Advance Tax 397 00 00 170 00 00

4. Tax Deducted at Source 46 54 30 96

5. Stationery 64 70 50 93

6. Telephone Deposit 4 19 Nil

7. Subvention receivable from NABARD 607 53 13 620 16 75

8. Interest incentive receivable from NABARD Nil Nil

9. Interest Subvention Received from GOI (NRLM) Nil Nil

10. Prepaid Expenses - Insurance 3 17 68 3 33 18

11. Income Tax paid against Disputed Demand 45 23 88 44 07 73

12. Deferred Tax 1 85 81 75 65

13. Others 18 85 34 18 42 52

Total 1327 31 68 1044 59 82

Particulars As at 31.03.2020 As at 31.03.2019

Claims against the Banks not acknowledged as debts 53 58 29 18 45 00

Liabilities for partly paid Investments Nil Nil

Liabilities on account of outstanding forward exchange contracts Nil Nil

Guarantees Given on behalf of Constituents

a) In India 10 89 00 11 38 84

b) Out Side India Nil Nil

Acceptances, Endorsements and other Obligations Nil Nil

Other items for which the Bank is contingetly liable

(DEA Fund) 3 40 91 1 43 08

Unclaimed Bankers Cheques (treated as income in

earlier years) 27 45 27 45

TOTAL 68 15 65 31 54 37

76

SCHEDULE – 13 - INTEREST EARNED(Rs in '000s)


Particulars Year Ended 31.03.2020


Year Ended 31.03.2019

SCHEDULE – 14 - OTHER INCOME (Rs in '000s)

Particulars Year Ended 31.03.20

SCHEDULE – 15 - INTEREST EXPENDED(Rs in '000s)

Year Ended31.03.2017

(Previous Year)

Particulars

Year Ended 31.03.19

Year Ended 31.03.20 Year Ended 31.03.19


Interest/ Discount on Advances/Bills 1972 97 85 1728 79 81

Interset on Investments 329 61 35 398 81 15

Interest on Balances with RBI and Other Inter Bank Funds Nil Nil

Others 300 92 13 241 76 63

TOTAL 2603 51 33 2369 37 59

Commission, Exchange and Brokerage 253 15 84 237 39 44

Profit on Sale of Investment 40 67 44 14 49 56

Profit on Revaluation of Investments Nil Nil

Profit on Sale of Lands, Buildings and Other Assets Nil Nil

Profit on Exchange Transactions Nil Nil

Income Earned by way of Dividend etc, from subsidiaries/

Companies and /or Joint Ventures abroad /In India Nil Nil

Miscellaneous Income 116 09 72 36 06 22

TOTAL 40 99 300 287 95 22

77

Interest on Deposits 1007 44 33 851 28 19

Interest on Reserve bank of India / Inter Bank Borrowings 383 02 92 471 64 75

Others Nil Nil

TOTAL 1390 47 25 1322 92 94

SCHEDULE – 16 - OPERATING EXPENSES(Rs in '000s)


Head Office: Warangal


Particulars Year Ended 31.03.2020 Year Ended 31.03.2019


78

Salary Payments and Provisions to Employees 266 88 73 221 75 58

Gratuity Contribution Fund Nil 4 78 49

Leave Encashment Fund Nil 8 83 64

Pension Contribution Fund NIl 23 30 00

Director’s Fee, Allowances and Expenses Nil Nil

Medical Expenses 5 31 05 7 43 28

Leave Fare Concession 6 55 8 19

Rent, Taxes, Lighting and Fuel 19 06 91 16 88 74

Printing and Stationery 7 83 16 5 22 56

Advertisement and Publicity 21 33 16 12

Depreciation on Banks Property 10 58 77 9 70 54

Auditors Fee and Expenses 77 68 72 70

Legal Charges 10 77 1815

Telephone Charges 73 12 1 16 34

Repairs and Maintenance 13 64 23 09

Insurance 21 58 24 15 40 65

Traveling and Halting expenses 8 06 53 7 44 32

AMC for Software and Hardware 18 83 79 15 31 07

Books and Periodicals 94 10 89 70

Computerization 45 04 53 50

Vehicle and Fuel 2 20 49 1 76 22

Entertainment 82 60 78 59

Other Expenses (Sundries) 45 32 56 33 61 52

TOTAL 409 95 06 376 22 99

SCHEDULE – 17 - SIGNIFICANT ACCOUNTING POLICIES


A. Basis of Preparation:

The Bank’s financial statements are prepared under the historical cost convention, on the accrual basis of

accounting on going concern basis, unless otherwise stated and conform in all material aspects to Generally

Accepted Accounting Principles (GAAP) in India, which comprise applicable statutory provisions, regulatory norms

/ guidelines prescribed by the National Bank for Agriculture and Rural Development (NABARD) / Reserve Bank of

India (RBI), Banking Regulation Act 1949, Regional Rural Bank Act, 1976 and amendments thereto and Accounting

Standards issued by the Institute of Chartered Accountants of India (ICAI), and the practices prevalent in the

banking industry in India.

B. Use of estimates:

The preparation of financial statements requires the management to make estimates and assumptions considered

in the reported amount of assets and liabilities (including contingent liabilities) as on the date of financial

statements and the reported income and expenses during the reporting period. Management believes that the

estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ

from to these estimates.

C. Significant Accounting Policies:

1. Revenue Recognition:

1.1. Income and Expenditure are accounted on accrual basis, except otherwise stated.

1.2. Interest income is recognised in the Profit and Loss Account as it accrues except, (i) income from Non

Performing Assets (NPAs), comprising of advances and investments which is recognised upon realisation, as per

the prudential norms prescribed by the RBI or other regulatory authorities. (ii) overdue interest on investments

and bills discounted, (iii) Income on Rupee Derivatives designated as "Trading", which are accounted on

realisation.

1.3. Profit / loss on sale of investments is recognised in the Profit and Loss Account.

1.4. Income (other than interest) on investments in "Held to Maturity (HTM)" category acquired at a discount to

the face value is recognised only at the time of sale / redemption.

1.5. Commission & Exchange and Locker rent have been recognized on realization basis.

1.6. Interest on overdue term deposits is accounted for on renewal basis.

1.7. In case of suit filed accounts, legal and other expenses incurred are charged to Profit and Loss Account and at

the time of recovery of such expenses is accounted as income.

2. Investments:

The transactions in Government Securities are recorded on “Settlement Date”. Investments other than

Government Securities are recorded on “Trade Date”.

2.1. Classification: Investments are classified into three categories viz., Held to Maturity (HTM), Available for Sale

(AFS) and Held for Trading (HFT) as per RBI guidelines.


79

2.2. Basis of classification:

I. Investments that the Bank intends to hold till maturity are classified as Held to Maturity (HTM).

II. Investments that are held principally for resale within 90 days from the date of purchase are classified as Held

for Trading (HFT).

III. Investments, which are not classified in the above two categories, are classified as Available for Sale (AFS).

IV. An investment is classified as HTM / HFT / AFS at the time of its purchase and subsequent shifting amongst

categories is done in conformity with regulatory guidelines.

However, for disclosure in Balance Sheet these are classified as under - Government Securities, Other Approved

Securities and Others.

2.3. Valuation:

i). In determining the acquisition cost of an investment:

a) Brokerage or Commission received on subscriptions is reduced from the cost.

b) Brokerage, Commission, Securities Transaction Tax (STT) etc., paid in connection with acquisition of

investments are expensed upfront and excluded from cost.

c) Brooking period interest paid / received on debt instruments is treated as interest expense / income and is

excluded from cost or sale consideration.

d) Cost is determined on the weighted average cost method for investments under AFS and HFT category and FIFO

basis (First in First out) for investments under HTM category.

ii) Transfer of securities from HFT / AFS category to HTM category is carried out at the lower of acquisition cost / book

value / market value on the date of transfer. The depreciation, if any, on such transfer is fully provided for. However,

transfer of securities from HTM category to AFS category is carried out on acquisition price / book value. After

transfer, these securities are immediately re-valued and resultant depreciation, if any, is provided

iii) Treasury Bills and Commercial Papers are valued at carrying cost.

iv) Held to Maturity category:

a) Investments under Held to maturity category are carried at acquisition cost unless it is more than the face value,

in which case the premium is amortised over the period of remaining maturity on constant yield basis. Such

amortisation of premium is adjusted against income under the head “Interest on Investments”.

b) Investments in equity shares of other companies are valued at historical cost. A provision is made for

diminution, other than temporary, for each investment individually.

v) Investments under AFS and HFT category: Investments under AFS and HFT category are individually re-valued at

market price or fair value determined as per regulatory guidelines, and only the net depreciation of each group for

each category (viz., (i) Government securities (ii) Other Approved Securities, (iii) Shares, (iv) Bonds and

debentures, and (v) others) is provided for and net appreciation, is ignored. On provision for depreciation, the book

value of individual security remains unchanged after marking to market.

vi) Investments are classified as Performing and Non Performing investments, based on the guidelines issued by the

RBI. Investments of domestic offices become non performing where:

a) Interest or instalment (including maturity proceeds) is due and remains unpaid for more than 90 days.

b) In the case of equity shares, in the event the investment in the shares of any company is valued at Rs.1/- per

company on account of the non availability of the latest balance sheet, those equity shares would be reckoned as


80

NPI.

3. Loans or Advances and Provisions thereon:

3.1. Loans and advances are classified as performing and non-performing, based on the guidelines/ directives issued by

the RBI. Loan assets become Non Performing Asset (NPA) where:

i) In respect of agriculture advances:

a) For short duration crops, where the instalment of principal or interest remains overdue for two crop seasons,

and

b) For long duration crops, where the principal or interest remains overdue for one crop season.

ii) In respect of Non Agriculture advances:

a) In respect of term loans, interest and / or instalment of principal remains overdue for a period of more than 90

days.

b) In respect of Overdraft or Cash Credit Advances, the account remains “out of order”, i.e. if the outstanding

balance exceeds the sanctioned limit or drawing power continuously for a period 90 days, or if there are no credits

continuously for 90 days as on the date of balance sheet, or if the credits are not adequate to cover the interest

debited during the same period.

3.2. All advances have been classified under four categories i.e., Standard Assets, Sub-standard Assets, Doubtful Assets

and Loss Assets. Provisions are made as per the extant guidelines/directives prescribed by the RBI.

Provisions on Advances are made as under:

I Standard Assets: General Provision for Standard Assets at the following rates:

Direct Advances to Agriculture and SME sectors at 0.25%

Commercial Real Estate sector at 1%

Housing Loans >20.00 lacs @ 0.75%

All other advances not included in (1) & (2) above at 0.40%

II Sub-Standard Assets:

A loan asset that has remained non performing for a period less than or equal to 12 months is a Sub Standard Asset

General Provision of 15% on the total outstanding

Additional Provision of 10% for exposures which are unsecured ab-intio (i.e. where realisable value of security is

not more than 10% ab-initio).

III Doubtful Assets:

A loan asset that has remained in the sub-standard category for a period of 12 months is Doubtful Asset


Secured Portion Up to One year 25%

One to three years 40%

More than three years 100%

Unsecured Portion 100%

81

5.3. Depreciation is provided on straight line method as per the following rates:


Description of Fixed Asset Depreciation rates

Buildings 1.6667%

Furniture & Fixtures other than Electrical Fittings and

Fixtures 10%

Electrical Fittings with 3 years life 33.33%

Electrical Fittings with 5 years life 20%

Electrical Fittings with 10 years life 10%

Safe Deposit Lockers, Fire proof data safe 5%

Computer systems & ATMs 33.33%

Computer software which does not form an integral part of 33.33%

computer hardware and cost of software development

Vehicles 20%

82

5.4. In respect of assets acquired during the year (for domestic operations), depreciation is charged on

proportionate basis for the number of days the assets have been put to use during the year.

5.5. Assets costing less than Rs. 5,000 each are charged off in the year of purchase.

6. Impairment of Assets:

Fixed assets are reviewed for impairment whenever events or changes in circumstances warrant that the

carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a

comparison of the carrying amount of an asset to future Net Discounted Cash Flows expected to be generated by the

asset. If such assets are impaired, the impairment to be recognised is measured by the amount which the carrying

amount of the asset exceeds the fair value of the asset.

7. Employee Benefits:

7.1. Short Term Employee Benefits:

The undiscounted amount of short – term employee benefits, such as medical benefits etc., which are

expected to be paid in exchange for the services rendered by employees, are recognized during the period

when the employee renders the service.

7.2. Long Term Employee Benefits

i). Defined Benefit Plans:

a. Gratuity:

The Bank provides for Gratuity liability based on actuarial valuation for all the eligible employees. The benefit is in

the form of lump sum payments to vested employees on retirement, or on death while in employment, or on


83

termination of employment, for an amount equivalent to 15 days basic salary payable for each completed year of

service, subject to the cap prescribed by the Statutory Authorities. Vesting occurs upon completion of five years of

service. The Bank makes periodic contributions to a fund administered by Trustees based on an independent

external actuarial valuation carried out annually, and contributes to SBI Life Insurance Company Limited.

b. Leave Encashment:

The Bank provides for Leave Encashment liability. The benefit is in the form of lump sum payments to vested

employees on retirement, or on death while in employment and vesting occurs at different stages as per rules. The

Bank makes periodic contributions based on an independent external actuarial valuation carried out annually, and

contributes to SBI Life Insurance Company Limited.

c. Pension:

As per the order of Hon’ble Supreme Court of India, the Bank provides for pension to all eligible employees. The

benefit is in the form of monthly payments as per the rules to vested employees on retirement or on death while in

employment, or on termination of employment. Vesting occurs at different stages as per rules. The pension

liability is reckoned based on an independent actuarial valuation carried out and Bank makes such initial

contributions periodically to the Fund as may be required to secure payment of the benefits under the pension

regulations.

d. The cost of providing defined benefits is determined using the projected unit credit method, with

actuarial valuations being carried out at each balance sheet date.

ii) Defined Contribution Plans such as Provident Fund are recognized as an expense and charged to the Profit &

Loss Account on accrual basis.st iii) The Bank operates New Pension System (NPS) for all staff joined on or after 1 April 2018 and

st ststaff joined be between 1 April 2010 and 31 March 2018 and opted for NPS, which is a defined Contribution

Plan. As per the scheme employees contributes 10% of their basic pay and DA together with matching

contribution from the Bank.

iv) Other Long Term Employee benefits:

All eligible employees of the Bank are eligible for leave fare concession, home travel concession. The costs of such

long term employee benefits are debited to Profit & Loss account of the Bank, in the year of expense incurred.

8. Taxes on Income:

Income Tax expense is the aggregate amount of current tax and deferred tax expense incurred by the Bank.

Current tax expense and deferred tax expense are determined in accordance with the provisions of the Income Tax

Act, 1961 and as per the Accounting Standard 22 – “Accounting for Taxes on Income” respectively and which are

based on the tax laws prevailing in India. Deferred tax adjustments comprise of changes in the deferred tax assets

or liabilities during the year.

Deferred tax assets and liabilities are recognised by considering the impact of the timing differences between

taxable income and accounting income for the current year, and carry forward losses. Deferred tax assets and

liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted at the Balance

Sheet date. The impact of changes in deferred tax assets and liabilities is recognised in the Profit and Loss Account.

Deferred tax assets are recognised and reassessed at each reporting date, based on management’s judgement as

to whether their realisation is considered as reasonably certain. Deferred Tax Assets are recognised on carry


84

forward of unabsorbed depreciation and tax losses only if there is virtual certainty supported by convincing

evidence that such deferred tax assets can be realised against future profits.

9. Contingent Liabilities & provisions:

9.1 In conformity with AS – 29, “Provisions, Contingent Liabilities and Contingent Assets”, issued by

the ICAI, the bank recognises provisions only when it has a present obligation as a result of a past event, and

would result in a probable outflow of resources embodying economic benefits will be required to settle the

obligation, and when a reliable estimate of the amount of the obligation can be made.

9.2. No provision is recognised for:

i). Any possible obligation that arises from past events and existence of which will be confirmed only

by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control

of the bank; or

ii). Any present obligation that arises from past events but is not recognised because:

a). It is not probable that an outflow of resources embodying economic benefits will be required to

settle the obligation; or

b). A reliable estimate of the amount of obligation cannot be made.

Such obligations are recorded as Contingent Liabilities. These are assessed at regular intervals and only that

part of the obligation for which an outflow of resources embodying economic benefits is probable, is

provided for, except in the extremely rare circumstances where no reliable estimate can be made.

iii). Contingent Assets are not recognised in the financial statements.

10. Special Reserves:

Revenue and other Reserve include Special Reserve created under Section 36(i)(viii) of the Income Tax

Act, 1961

SCHEDULE – 18 DISCLOSURES & NOTES TO ACCOUNTS

I. Disclosures as per norms for RRBs

1. Capital

2. Investments

3. Repo Transactions

Minimum Maximum Daily Average As onst outstanding outstanding outstanding 31

during the during the during the March, year year year 2020

Securities Sold under Repos Nil Nil Nil Nil

Securities purchased under Nil Nil Nil Nil Reverse Repos

Item

(Rs in '000s)

(Rs in '000s)

The Bank has invested a sum of Rs. 24,99,200/- in National Payments Corporation of India (NPCI),

a company promoted by ten banks under the guidance of Indian Bank's Association.



Sl.No Particulars March 2020 (%) March 2019 (%)

i) CRAR(%) 16.15 15.50

ii) CRAR – Tier I Capital 15.75 15.09

iii) CRAR – Tier II Capital 0.40 0.41

iv) Percentage of Shareholding of the :

A Government of India 50 50

B Government of Andhra Pradesh 15 15

C State Bank of India (Sponsor Bank) 35 35

S.No Particulars March 2020 March 2019

1 Value of Investments

i) Gross value of Investments 3838 85 34 5392 30 59

ii) Provisions for Diminution 15 98 66 15 98 66

iii) Net value of Investments 3822 86 68 5376 31 93

2 Movement of provisions held towards depreciation on investments

i) Opening Balance 15 98 66 3 10 55

ii) Add: Provisions made during the year Nil 12 88 11

iii) Less: Write off / Write back of excess provisions during the year Nil Nil

iv) Closing Balance 15 98 66 15 98 66

85

4. Non-SLR Investment Portfolioi) Issuer composition of Non SLR Investments

(ii) Non-Performing Non-SLR Investments

Particulars Amount

Opening balance NIL

Additions during the year since 1st April 2019 NIL

Reductions during the above period NIL

Closing Balance NIL

Total provisions held NIL

(Rs in thousands)

5. Asset Quality

S.No. Particulars March 2020 March 2019i) Net NPAs to Net Advances (%) 0 0.34ii Movement of NPAs (Gross) (a) Opening balance 189 09 93 195 64 24(b) Additions during the year 426 90 81 293 46 36(c) Reductions during the year 417 51 16 300 00 67(d) Closing balance 198 49 58 189 09 93iii Movement of Net NPAs (a) Opening balance 55 61 61 28 02 81(b) Additions during the year 131 36 74 75 53 99(c) Reductions during the year 186 98 35 47 95 29(d) Closing balance 0 55 61 61iv Movement of provisions for NPAs (Excluding provisions on standard assets) (a) Opening balance 133 48 32 167 61 44(b) Provisions made during the year 102 73 89 11 63 07(c) Write-off / Write-back of excess provisions 37 72 64 45 76 19(d) Closing balance 198 49 57 133 48 32

I. Non-Performing Assets (Rs in '000s)

(Rs in thousands)

During the year the Bank has fully provided provision on all NPA Accounts.


S. No Issuer Amount Extent of Extent of Extent of Extent of Private below investment unrated unlisted placement grade securities securities securities

1 2 3 4 5 6 7

i) PSUs NIL NIL NIL NIL NIL

ii) FIs NIL NIL NIL NIL NIL

iii) Banks NIL NIL NIL NIL NIL

iv) Private NIL NIL NIL NIL NIL Corporates

v) Others (MF

& Equity shares of

NPCI) 84 99 99 NIL NIL NIL NIL

vi) Provisions held towards NIL NIL NIL NIL NIL depreciation

Total 84 99 99 NIL NIL NIL NIL

86

ii. Details of Loan Assets subject to Restructuring

iii) Details of financial assets sold to Securitization (SC) / Reconstruction Company (RC)for Assets Reconstruction


i No. of accounts Nil Nil

ii Aggregate value (net of provisions) of accounts sold to SC/RC Nil Nil

iii Aggregate consideration Nil Nil

iv Additional consideration realized in respect of accounts

transferred in earlier years Nil Nil

v Aggregate gain / loss over net book value Nil Nil

Total (i) = (ii) + (iii) + (iv) Nil Nil

IV) Details on non-performing financial assets purchased / sold A. Details of non-performing financial assets purchased:


1 (a) No. of accounts / purchased during the year Nil Nil

(b) Aggregate outstanding Nil Nil

2 (a) Of these, number of account restructured during the year Nil Nil

(b) Aggregate outstanding Nil Nil

B. Details of non-performing financial assets sold :

S.No. Particulars March 2020 Marh 2019

1 No. of accounts sold Nil Nil

2 Aggregate outstanding Nil Nil

3 Aggregate consideration received Nil Nil

(Rs in thousands)

(Rs in thousands)

(Rs in thousands)

(Rs in '000s)


i Total amount of loan assets subject to restructuring,

rescheduling, renegotiation Nil Nil

ii The amount of Standard Assets subjected to restructuring,


iii The amount of Sub-Standard Assets subjected to restructuring,


iv The amount of Doubtful assets subjected to restructuring,


Total (i) = (ii) + (iii) + (iv) Nil Nil


87

v. Provisions on Standard Assets

S.No. Particulars March 2020 March 2019

1 Provisions on Standard Assets 59 59 92 49 02 99

6. Business Ratios


i Interest income as a percentage to Working Funds 9.33 9.32

ii Non-Interest income as a percentage to Working Funds 1.47 1.13

iii Operating profit as a percentage to Working Funds (Before Provisions) 4.35 3.75 iv Returns on Assets (%) 2.21 0.44

v Business per Employee (Dep + Adv) (Rs'000) 11 44 29 10 28 43

vi Net profit per Employee (Rs'000) 18 69 3 52

7. Asset Liability Management – Maturity pattern of certain terms of Assets and Liabilities

Particulars1 to 14

days15 to 28

days

29 days to 3

months

Over 3 months

and upto 6

months

Over 6 months

and upto 1 year

Over 1 year and

upto 3 years

Over 3 year and

upto 5 years

Over 5 years

Total

Deposits 1019 67 29 350 79 21 1551 47 78 2092 87 04 5019 60 11 8179 06 49 159 15 81 123 05 34 18495 69 07

Advances 4518 27 41 114 41 53 615 70 71 1188 41 73 5772 66 32 29 49 10 30 45 06 4965 04 00 17234 45 86

Investments & STDRs

0 489 65 1364 79 72 3152 88 25 2839 0810 1043 97 53 60 24 27 8465 87 52Borrowings

9794 1650 00 00 3940 87 00 2007 85 00 175 25 00 108 38 35 11970 07 29

Foreign Currency Assets

Nil Nil Nil Nil Nil Nil Nil Nil Nil

Foreign Currency Liabilities

Nil Nil Nil Nil Nil Nil Nil Nil Nil

(Rs in '000s)

(Rs in thousands)

3644 74 00

0

442 00 00


88

8. Exposures – Exposure to Real Estate Sector


a Direct exposure

i Residential Mortgages above Rs. 20.00 lakhs lending fully secured by mortgages on residential property that is or will be 1423 88 44 884 87 99 occupied by the borrower or that is rented (individual housing loan upto Rs. 20 lakh may be shown separately)

Up to Rs. 20.00 lakhs 1222 42 99 1006 99 08

ii Commercial Real Estate Lending secured by mortgages on commercial real estates 1097 75 Nil (office buildings, retail space, multi-purpose commercial premises, multi-family residential buildings, multi-tenanted commercial premise, industrial or warehouse space, hotels, land acquisition, development and construction, etc.) Exposure would also include non-fund based (NFB) limits.

iii Investments in Mortgage Backed Securities (MBS) and other securitized exposures Nil Nil

a. Residential Nil Nil

b. Commercial Real Estate Nil Nil

b Indirect Exposure Nil Nil

Fund-based and non-fund based exposures on National Housing Bank (NHB) and Housing Finance Companies (HFCs) Nil Nil

9. Details of Single Borrower (SGL), Group Borrower Limit (GBL) exceeded by the bank:

The bank had not exceeded the single borrower limit, group borrower limit fixed by the Board

10. Miscellaneous – Amount of provisions made for Income tax during the year.

Particulars March 2020 March 2019

Provision for Income Tax 276 92 88 45 00 00

11. Disclosure of Penalties imposed by RBI

The Bank has maintained CRR and SLR as per RBI Act 1934 and Banking Regulation Act 1949 and not defaulted

during the financial year under report.

12. Additional Disclosures as per Accounting Standards applicable to the Bank

(i) Related party disclosure

a) Related parties where control / significant influence exists or with whom transaction have taken place during

the year.

Sponsor Bank their Subsidiaries and Associates : State Bank of India

(Rs in thousands)

(Rs in thousands)


89

st stParticulars 31 March 2020 31 March 2019

Refinance received from State Bank of India Nil Nil

Interest paid to SBI 4 07 46 68 81 42

Investments made with:

SBI - in the form of STDRs 188 21 95 260 80 96

SBI Fund Management Private Limited 82 95 00 Nil

Interest received from SBI 20 62 64 27 36 43

Profit on sale of Investments on SBI 3 74 23 70 05

Contributions to Gratuity Fund with SBI Life Insurance Co. Ltd Nil 4 78 49

Contributions to Group Leave Encashment Policy withSBI Life Insurance Company Limited Nil 8 83 64

Contributions to Pension Trust Policy with SBI life InsuranceCompany Limited on behalf of Trust 225 28 10 Nil

Current Account Balance with SBI 8 27 3 48 98

(iii) Particulars of Managerial Remuneration:

Key Management Personnel

Shri K. Praveen Kumar, Chairman (From: 02.02.2019)

Shri G. Sukumar, General Manager –I

Shri Ch Sree Rama Somayaji, General Manager-II

Shri G. Nagaraju, General Manager – III

Shri P. Pardhasaradhi, General Manager – IV

Shri N. Venkata Ramana, General Manager – V (Chief Vigilance Officer)

Shri K. E. Subrahmanyamu, General Manager-VI

(ii) Particulars of related party accounts transactions:

The following is the summary of significant related party transactions:

st stParticulars For the year 31 March 2020 For the year 31 March 2019

Shri K. Praveen Kumar, Chairman 28 64 648/- 3 95 359/-

Shri.V.Narasi Reddy, Chairman Nil 26 22 045/-

Shri.M. Satyanaryana, General Manager - I 8 46 811/- 20 65 660/-

Shri.T.V.Krishna Reddy, General Manager - II 4 28 486/- 21 59 052/-

Shri.G.Nagaraju, General Manager - III 23 12 772/- 22 53 732/-

Shri K. Ravi Kiran, General Manager - IV 4 10 287/- 20 82 712/-

Shri N. Venkata Ramana, General Manager - V 23 13 436/- 3 78 438/-

Shri P.Pardhasaradhi General Manager IV 19 30 755/- Nil

Shri Gouru Sukumar General Manager I 14 87 826/- Nil

Shri Ch Srirama Somayaji General Manager II 12 97 523/- Nil

Shri Eswara Subrahmanyamu Karri General Manager VI 11 32 315/- Nil

(Rs in thousands)

(in Rupees)


90

13. Provisions on Rural Advances

14. Disposal of Complaints:

A) Customer Complaints:

S.No Particulars IT NON IT TOTAL

a No. of complaints pending at the beginning of the year 19 7 26

b No. of complaints received during the year 2018-19 1,506 595 2,101

c Total Complaints 1,525 602 2,127

d No. of complaints redressed during the year 1,495 577 2,072

e No. of complaints pending at the end of the year 30 25 55*

B) Award passed by the Banking Ombudsman:

S.No Particulars Nos

a No. of complaints pending at the beginning of the year 05

b No. of complaints received during the year 2019-20 82

c Total Complaints 87

d No. of complaints redressed during the year 77

e No. of complaints pending at the end of the year 10*

f No. of awards passed by Banking Ombudsman 0

g No of awards implemented Not applicable

h No. of awards pending implementation Not applicable

(Rs in thousands)

2. Concentration of Advances (Rs in Crores)

Total Advances of Twenty largest Borrowers 23.47

Percentage of Advances of twenty largest borrowers to Total Advances of the Bank 0.12%

S.No. Particulars March 2020 March 2019

a Opening balance in the Rural Advances Provision Account Nil 10 67 36

b The quantum of Rural Advances Provision made in the accounting year Nil Nil

c i. Amount of Draw down made during the accounting year Nil Nil

ii. Provision written back to profit and Loss account Nil 10 67 36

iii. Total of Draw down Nil Nil

d Closing balance in the Rural Advances Provision Account Nil Nil

* Out of 7, 6 complaints were closed during the 1st week of April 2019

15. Concentration of Deposits Advances Exposures and NPAs

1.Concentration of Deposits (Rs in Crores)

Total Deposits of Twenty largest depositors 2309.52

Percentage of Deposits of twenty largest depositors to Total Deposits of the Bank 12.49%


91

Sub-Total (B)

Total (A+B)1946.43 8.08 0.42% 1444.90 7.71 0.53%

19322.96 198.50

1.03% 16658.41

189.10 1.14%

16. Sector Wise NPAs (Rs. in Cr)

Sl. No Sector*

Current Year (March 2020) Previous Year (March 2019)

OutstandingTotal Advances

Gross NPAsPercentage of Gross NPAs to Total Advancesin that Sector

Percentage of Gross NPAs to Total Advancesin that Sector

A Priority Sector

1 Agriculture and allied activities

13154.83 130.92 1.00% 11169.16 109.54 0.98%

2. Advances to industries sector eligible as priority sectorlending

2263.34 43.80 1.94% 2012.68 37.94 1.89%

3 Services 71.59 5.98 8.35% 60.18 6.83 11.35%

4 Personal Loans 1886.77 9.72 0.52% 1971.49 27.08 1.37%

Sub-Total (A) 17376.53 190.42 1.10% 15213.51 181.39 1.19%

B Non-PrioritySector

1 Agriculture and allied activities -

-

-2 Industry

3 Services

4 Personal loans 1946.43 8.08 0.42% 1444.90 7.71 0.53%

OutstandingTotal Advances

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Gross NPAs

3. Concentration of Exposures (Rs in Crores)

Total Exposure of Twenty largest Borrowers/Customers 27.56

Percentage of Exposures to twenty largest Borrowers/Customers to Total Exposure of the Bank on borrowers / customers 0.14%

4. Concentration of NPAs (Rs in Crores)

Total Exposure to top four NPA accounts 1.12 Cr, 0.56%


92

17. Movement of NPAs

II. NOTES TO ACCOUNTS

1. Reorganization of Area of Operations of the Bank:

The Bank has been formed vide Notification dated 31 March 2006 issued by Department of Economic Affairs st

(Banking Division), Ministry of Finance, Government of India. As per the said notification, the area of the operation of the Bank is in eight districts of erstwhile State of Andhra Pradesh (Warangal, Medak, Khammam, Nalgonda, Mahabubnagar, Srikakulam, Vizianagaram and Visakhapatnam districts).

Vide notification dated 20 October 2014 issued by the Department of Financial Services, Ministry of Finance, th

Government of India the districts of Warangal, Medak, Khammam, Nalgonda, Mahabubnagar are omitted. Pending finalization of the modalities for this notification and approvals from the competent authority, the operations of the bank are being carried out in all the five districts. Financial statements as at the end of the reporting date include assets and liabilities, income and expenses relating to the Bank in all the eight districts.

st2. Classification of Assets (Advances) as on 31 March, 2020: (Rs in thousands)

3. Inter Bank Participation Certificate (IBPC):

The Bank has entered into Risk sharing participation Contract with State Bank of India (Sponsor Bank) under Inter

Bank Participation Certificate (IBPC) and issued priority sector advances to the extent of Rs. 590 Crore on

28.06.2019 for the period of 179 days as cash pay-out and matured on 24.12.2019.During this financial year, the

Bank issued priority sector advances to an extent of Rs. 1100 Crore on 24.09.2019 for the period of 179 days as cash

pay-out to the HDFC Bank and matured on 26.03.2020 . Further, again during the year, the Bank issued priority

sector advances to an extent of Rs. 590 Crore on 26.12.2019 for the period of 180 days as cash pay-out with a

maturity date 23.06.2020 and also issued priority sector advances of Rs. 1300 Crore on 24.03.2020 for the period of

180 days as cash pay–out, with a maturity date 20.09.2020 to HDFC Bank.

Classification Gross Advances Net Advances

Standard Assets 19124 46 95 19064 87 03

Sub Standard Assets 81 38 93 0

Bad & Doubtful Assets 117 10 64 0

Total 19322 96 52 19064 87 03

Add: Provision on Sub-Standard And Doubtful Assets etc 198 49 57

Total Gross Advances 19263 36 60

Particulars Rs. in CroresstGross NPAs as on 1 April 2019 (Opening Balance) 189.10

Additions (Fresh NPAs) during the year 426.90

Sub-Total (A) 616.00

Less:

(I) Upgradations 345.30

(ii) Recoveries (excluding recoveries made from upgraded accounts) 35.47

(iii) Write-Offs 36.73

Sub-Total (B) 417.50stGross NPAs as on 31 March 2020 (Closing Balance) (A-B) 198.50

During the year the Bank has fully provided provision on all NPA Accounts.


93

(Rs in 000s)

PSLC Sold PSLC Purchased Net Profit earned

during the YearTotal Sold

8800.00 6250.00

Premium Received

127.925

Premium Paid

15.795 112.13

5. Bankers' Cheques:

The Unpaid Banker Cheques which were credited earlier years to P&L account aggregating to Rs.27,45 (in

thousands) furnished as contingent liability in Schedule 12.

6. Depositor Education and Awareness Fund (DEAF) Scheme:

Disclosure as required under Depositor Education And Awareness Fund Scheme – 2014 notified by the Reserve

Bank of India under DBOD No. DEAF Cell.BC.114/30.01.002/ 2013-14 dated 27th May 2014:

(Rs in 000s)

Sl No Particulars March 2020 March 2019

1 Opening Balance of Amount transferred to DEAF 1,43,08 1,34,98

2 Add: Amount transferred to DEAF during the Year 2019-20 1,98,00 8,33

3 Less: Amounts reimbursed by DEAF towards Claim 17 23

4 Closing balance of amounts transferred to DEAF 3,40,91 1,43,08

7. Fixed Assets:

The Bank is in possession of Land at various places in both Andhra Pradesh and Telangana states, to an extent of to

an extent of 9,432.26 square yards. Some of such lands were alienated by Government and some were donated by

individuals. The bank has also taken up constructions at some of the sites. All such expenditure/costs were

capitalized under lands and buildings. During 2018-19 an amount of Rs. 1,61,59 (thousand) was capitalized and an

amount of Rs. 8,75,61 (thousand) was in work in progress. During 2019-20, a further amount of Rs. 8,47,49

(thousand) was capitalized and work in progress came down to Rs. 12360 (thousand) from 85761(thousand).

8. Income Tax Matters:

Income Tax department has raised certain demands on the Bank, with regard to assessment of income of the Bank

and the tax payable thereon. The Bank is contesting demands raised by the Income Tax Department and pursuing

the same. Against the said tax demands based on the opinion obtained from the tax consultant, the Bank

recognized an amount aggregate to Rs. 53,58,29 (thousands) as Contingent Liabilities and are shown in Schedule 12

– “Contingent Liabilities - Claims against the Banks not acknowledged as debts”. Against the disputed claims, the

Bank paid an amount of Rs. 45,23,88 (thousands) and the same is being shown in Schedule 11 – “Other Assets -

Income Tax paid against Disputed Demand”. Bank is confident of resolving the dispute in its favour. Liability, if any,

will be charged to Profit and Loss account in the year of settlement of these disputes / claims.

Total Purchased

4. Priority Sector Lending Certificate (PSLC):

During the Financial year, the Bank has sold and purchased following priority sector advances on various dates and

earned profit of Rs.112.13 crores. The PSLC is valid upto 31.03.2020.


94

10. Fraud Cases:

Details of Fraud cases are as under:(Rs in 000s)

11. The figures mentioned in Balance Sheet, Profit & Loss Account and Schedules 1 to 16 have been rounded off to the

nearest thousand rupees. Previous Year's figures have been regrouped /reclassified/recast wherever necessary to

confirm the current year classification.

12. Note on COVID-19:

The onset and rapid propagation of COVID-19 has caused disruptions in the banking operations, restrictions on

travel, meetings and access to client locations and other practical difficulties. There is a high level of uncertainty

about the duration of the lockdown and the nature of the restrictions, limitations, regulatory requirements,

existing business environment, materiality and their possible impact on the banking operations. In this regard

certain regulatory measures were announced by RBI to mitigate the burden of debt servicing brought about by

disruptions and to ensure the continuity of viable businesses. In assessing whether the going concern assumption is

appropriate, the management has considered all available information about the future, which is at least, but is not

limited to, twelve months from the end of the reporting period, the anticipated government support and provisions

held by the bank. In view of these matters the management is of the opinion Financial statements are normally

prepared on the assumption that the bank is a going concern and will continue in operation for the foreseeable

future.

Particulars 31 March 2020 31 March 2019

Provision at the beginning of the year 6.15 80.40

Less: Written off during the year Nil 15,89

Add: Additional provision created during the year Nil Nil

Less : Provision reversed (written back) during the year 68 58,36

Provision as at the year end 5.47 6,15

Number of fraud cases at the year end 25 23

9. Data Purification and Asset Classification

The Bank is having a seamless system in its Core Banking Solution (CBS) for recognizing and identifying the non

performing assets in accordance with the extant guidelines. Further, the Bank has a system of manual verification

for ensuring the correctness of base data fed. Management intends to continue such manual verification to ensure

compliance of the Income Recognition and Asset Classification norms and other statutory compliances.


95

Disclosures as required vide Circular No. RBI/2019-20/220 DOR.No.BP.BC.63/21.04.048/2019-20

April 17, 2020:

Particulars 31.03.2020 31.03.2019

Respective amounts in SMA/overdue categories, where the

moratorium/deferment was extended, in terms of paragraph

2 and 3; 1,97,640.75 Nil

Respective amount where asset classification benefits is extended. 1,97,640.75 Nil

Provisions made during the Q4FY2020 and Q1FY2021 in terms of

paragraph 5; 9,882.04 Nil

Provisions adjusted during the respective accounting periods

against slippages and the residual provisions in terms of

paragraph 6. Nil Nil


96





M No : 229988

Place: Warangalth

Date: 10 May 2020


