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Raj bank

  1. 1. A REPORT ONTHE CO-OPERATIVE BANK OF RAJKOT LTD. (RAJ BANK) Submitted To :: - SAURASHTRA UNIVERSITY Submitted By :: - LIMBASHIYA CHIRAG G. (S.Y. B.B.A) Guidance :: - MR. NIRAJ PANDYA Academic Year :: - 2005-2006 College :: - R.P.BHALODIA COLLEGE RAJKOT. (1)
  2. 2. PREFACE Practical training is the part of our study in B.B.A. it iscompulsory for each student to take training for 15 days in anyservice sector and prepare the project report on that service sector. The training has been undergone at “THE CO-OPERATIVEBANK OF RAJKOT LTD.” for the knowledge of practical study ofunit. This report contains the true knowledge and all the aspectover gone in the practical. It covers all the various department likemarketing department, financial department and personneldepartment. “THE CO-OPERATIVE BANK OF RAJKOT LTD.”“Sahkar Sarita” Panchanath Road, Rajkot – 360 001. Phone :(0281) 2224120 / 2234733 / 2233155. Fax : (0281) 2236682.E–mail : raj bank. I have prepared the report of “THE CO-OPERATIVE BANKOF RAJKOT LTD.” on the basic of information, which I collectedfrom various department of the company. I got all the information,which I wanted from this company.DATE :: - ___________ (2)
  3. 3. PLACE ::- ___________ (SIGNATURE) (LIMBASHIYA CHIRAG G.) (3)
  4. 4. ACKNOWLEDGEMENT The preparation of the report is my own work, but I havetaken help from many persons. I am thankful to all those personswho helped me in activity out this work. I express my deepest of gratitude the manager of “THE CO-OPERATIVE BANK OF RAJKOT LTD.” and all the memberswho provided all the necessary information. He gives me grate pleasure in thanking Mr. NIRAJPANDYA who helped me out in my work. Without him ever readyhelp, whole hearted guidance, never ending encouragement andenthusiasm. It was difficult to bring this report to its present form. I would be failing my duty if I will not mention thanks to familymembers, relatives and friends to helping me throughout.DATE :: - ___________PLACE ::- ___________ (SIGNATURE) (4)
  6. 6. DECLARATION I, the undersigned LIMBASHIYA CHIRAG G. student ofS.Y.B.B.A. from the Shri R.P.BHALODIA COLLEGE ofCommerce & Business management & Computer studies, declarethat this project report is prepared by me. I had taken a help of mycollege and professor for the purpose of guidance only and to addthat, myself prepare this report.DATE :: - ___________PLACE ::- ___________ (SIGNATURE) (LIMBASHIYA CHIRAG G.) (6)
  7. 7. CONTENTS• Preface 2• Acknowledgement 3• Declaration 4• Banking Sector In India 9• General Information Of Co-Op. Banks 11 -19  Introduction 12  Definition Of Co-Operative 13  Principles & Characteristics 14  Types Of Co-Operative Bank 16  Role Of Co-Operative Bank 18  Registration & Licensing 19• RAJ BANK At Glance 20 -32  Introduction 21  Corporate Mission 22  The Executive Committee 23  Branch Network & Structure 24 (7)
  8. 8.  Awards & Accolades 29 Corporate Governance & RAJ BANK 30 Relationship Management 32 (8)
  9. 9. • Services At The RAJ BANK 34 -52  Introduction 35  Depository Services 36 - 42  Current Deposit 36  Saving Deposit 38  Term Deposit 40  Recurring Deposit 41  Children Deposit 42  Advance Services 43 - 49  Business Loan 43  Medical Equipment Loan 44  Term Loan 44  Mortgage Loan 45  Secured Overdraft 45  Clean Overdraft 46  Personal Loan 46  Vehicle Loan 47  Loan against NSC / KVP / LIC. 48  Home Loan 49 (9)
  10. 10.  Other Services 50 - 52  Safe Deposit Vault 50  Cash – Card Facility 51  ATM Facility 52  Cheques Depository Service 52 (10)
  11. 11. • H. R. M. At The RAJ BANK 53 -63  Introduction 54  Human Resource Policies & Program 55  Recruitment 57  Selection 58  Orientation & Placement 59  Employee Remuneration 60  Training & Development 62  Promotion & Transfer 63• Marketing At The RAJ BANK 65 - 68  Introduction 66  Promotional Activities 67  Marketing Research & Information 68• Finance Management At The RAJ BANK 69 - 81  Introduction 70  Financial Planning 71  Capital Structure Of The RAJ BANK 72  Capitalization 73  Cash Management 74  Ratio Analysis 75 (11)
  12. 12.  Finance Information 76 Progress Report 77 NPA & Recovery Management 79 Risk Management 81 (12)
  13. 13. • S. W. O. T. Analysis 83• Future Plan 86• Suggestion 88• Conclusion 90• Bibliography 92 (13)
  14. 14. Bankin gSector (14)
  15. 15. InIndia (15)
  16. 16. BANKING SECTOR IN INDIA The importance of banking as the nerve sector of economicdevelopment can not be over emphasized. Banking industry hasacquired a key position in mobilizing resources for defense & forsocio economic development of the country. It is said that “Bankwhich are that need of & great wealth of ourcountry have got to be kept very sacred. Just aswater is for irrigation, good banks are for thecountry’s industry & trade.” Since the beginning ofplanning in India banking industry has grown not only in size butalso in depth this industry has become one big complex. Today banks have become a part & parcel of our life. Ti wasthe time when the dwellers of city alone could enjoy their services.Now banks offer access to even a common man & their activitiesextend to areas hither to untouched & after the globalization &liberalization policy of India, many foreign banks have entered inIndian market with different services & innovation technologies.Apart from their traditional business oriented functions, they havenow come out to fulfill national responsibilities. Today’s banks caterto the needs of agriculturists, industrialist, traders, women, (16)
  17. 17. students & to all other sections of the society. Thus they acceleratethe economic growth of a country & steer the wheel of the economytowards it’s goal of “Self reliance in all fields.” Hencetoday banking sector has become the lifeline of the economy. In present age in India there are many banks includingforeign banks, public sector, private sector, commercial banks & co-operative banks. General Informati on of (17)
  18. 18. Co-Operative Banks (18)
  19. 19. INTRODUCTION Over the year the difference between co-operative banks &commercial banks has blurred as they all have come under acommon law. All products & services are offered by co-operativebanks are on the par with commercial banks, with a few exceptionsrelated to government business. In 1904 the co-operativemovement started in India with a view to provide finance to theagriculturist at a low rate of interest. The co-operative society has totake the place of the money lenders & provide cheap loan to thefarmers for productive purposes. Even though many types of co-operative societies have been started particularly for the artisans &others, the most common form of such societies deal in ruralcredits. And today co-operative banks have started verities ofservices with different technologies. Once the MahatmaGandhiji has remarked that “there is sweetness in co-operation; there is no one who weak or strongamong those who co-operate. Each is equal toother.” So, after having such easy government policy, today many co-operative banks have started in India. And they are catering to theall section of the society, & also today co-operative sector has (19)
  20. 20. grown in all over the world, with globalization of the world they havealso started to implement new technologies & various managementtools. Now, they are in same market with all the other banks. So, bythis way the co-operative banks are in the key position in theeconomy. (20)
  21. 21. DEFINITION OF CO-OPERATION Co-operation has been defines in slightly different ways invarious sciences & by various scholars. This is due to its flexiblenature which can lend itself to variety of purpose & social system,in order to have a through understanding of the concept some wellknown definitions are discussed below. “Co-operation is a form of organization where in personsvoluntarily associate together as human beings on a basis ofequality, for the promotion of economic interests of them selves.” -Hubert Calvert “Another protagonist is an association for the purpose ofjoint trading, originating among the weak & conducted always in anunselfish spirit, on such terms that all who are prepared of assumethe duties of membership my share in it’s reward in proportion tothe degree in which they make use of there association.” - C. R. FAY (21)
  22. 22. PRINCIPLE & CHARACTERISTICS Careful analyses of the above definitions will reveal thefollowing principles & characteristics of co-operative organization. VOLUNTARY ASSOCIATION ::- Co-operative organization is purely a voluntary association ifindividual who join together for betterment of their economicinterest through collective efforts. A member is at liberty to leavethe organization at any time & withdrawal his capital by giving duenotice. But it should be remembered that a member is not allowedto transfer his shares to another person as found in the companyorganization. OPEN MEMBERSHIP ::- Membership of co-operative organization is open to allirrespective of religion caste, colour, creed, political affiliationsbelief & status to which a person belongs. The membership fees & (22)
  23. 23. the entrance fees are kept relatively low so as to enable theeconomically weak to become the members. (23)
  24. 24.  EQUAL VOTING RIGHTS ::- Equality is the quintessence of co-operative organization.Members have equal voice in the management of it’s affairs withthe underlying principle “ ONE FOR ONE VOTE .“ SERVICE MOTIVE ::- It is mainly intended to goods first to it’s members & then tooutsiders at profit the primary aim of any co-operative organizationis to render service to its member. So these are the primary motiveor principles. There are other principles, co-operative organizationhas to follow those principles like state control, democraticorganization etc. (24)
  25. 25. (25)
  26. 26. TYPES OF CO-OPERATIVE BANKS There are mainly three types of co-operative banks inIndia. • State co-operative banks • Central co-operative banks • Urban co-operative banks STATE CO-OPERATIVE BANKS ::- These banks are also known as apex bank & are registeredunder co-operative societies act – 1912. In fact these banks areestablished to function as a leading co-operative financialinstitution of the state offer co-operative societies should grow. The“apex banks “as they are called are they to render financial help as& when the co-operative societies are in need of their help. CENTRAL CO-OPERATIVE BANKS ::- A district level of central co-operative banks is functioning asa commercial bank & that too as an independent unit. They arethere in order to strengthen the co-operative movement in thecountry. In fact these banks are the key link between people & apex (26)
  27. 27. bank & render valuable services to downtrodden & rural folk intaking them out of the financial wood central co-operative banksget funds from(A) share capital (B) deposits (C) financial help from state co-operative banks (D) state bank of india & (E) commercial banks.Their working capital is usually provided by state government. (27)
  28. 28.  URBAN CO-OPERATIVE BANKS ::- Urban co-operative banks are organized & established intowns on the pattern of joint – stock banks but are establishedunder co-operative societies act – 1912. For funds these banksdepend on their own sources. However central co-operative banksare helping them in financially viable. Central co-operative banksare directly links with the state co-operative banks. Urban primaryco-operative banks provide funds to rural folk in easy terms to helpthem in agriculture work aid its development today they havestarted playing a significant role in rural upliftment. They are in tunewith the government policies & program. (28)
  29. 29. ROLE OF CO-OPERATIVE BANKS Now-a-days co-operative banks are progressing very fast thenany commercial or nationalized banks. The customer servicelending services & other banking facilities given to the society isbeing better than other banks. So people are also being attracted &interested in co-operative banks. The main aim of the bank is to extend credit facilities to thesmall traders, workers & other middle class people. This bankderive their funds for working partly through share capitalcontributed by the members & partly through deposits collectedfrom members, general public & render usual banking services. Theliability of members is normally unlimited. This enables the societyto raise funds from outside agencies & also encourages member totake keen interest in working of the society. (29)
  30. 30. REGISTRATION & LICENSING There should be co-ordination between the state co-operativedepartment & RBI for the registration & licensing of urban banks.Urban banks should build up their share capital & reserve to therevised minimum level with in period of 3 year which can beextendedly by the RBI to a further period of 2 years whenevernecessary. For organization or urban co-operative bank in each statethere should jointly survey local areas & identify the potentialgrowth centers where urban banks could be organized once suchcenters are located prominent person of the locality might becontacted to seek their assistance for registration of the urbanbanks. New banks are to be organized in backward areas or byweaker section of the community may not be able to collect theinitial minimum share capital required for obtaining license.Government assistant in the form of share capital contribution forsuch new banks may be equal to that collected by members. (30)
  31. 31. These banks derive their funds for working partly throughshare capital contributed by the numbers & partly through depositscollected from members & non-members & renders usual bankingservices. The shares are of higher value. But the liability of themember is limited to the extent to the shares hold by them. (31)
  32. 32. RajBankAt A (32)
  33. 33. Glance (33)
  34. 34. INTRODUCTION The co-operative bank of Rajkot ltd. popularly known as Rajbank is established on 25 - 11 – 1980 under the strong, effectiveleader ship of one of the national co-operative hero honor ShriRamnikbhai Dhami with the intention of survive the common man. The local intensity of the bank in it’s customer centricapproach, hassle free execution of the decision & technologies aretheir main difference from commercial banks, also high level ofcommitment at all levels of management & self committed groundlevel staff makes them different from other commercial banks. At present Raj bank has achieved a key position in themarket of saurashtra. It has 11 branch in all over Saurashtraincluding main branch with the advanced technologies andeducated staff, as it it said that “In the emerging competitivebusiness environment Co-operative banks who adhere to strictFinancial discipline. Only will survive” On this basis at present Rajbank is becoming more prestigious in the banking sector. (34)
  35. 35. CORPORATE MISSION• Survive to the common man.• Enhance the value of share holders.• Emerge as a symbol of public trust & confidence by creating a positive image.• Maintain excellence in operation & management by bringing in transparency & integrity.• Develop & motivate human resource there by cultivating professional culture in the banking operation.• Ensure speedy & satisfactory customer services through continuous product innovation & aggressive marketing strategies.• And the last but not least that is….• “To assist the weaker section of the society” Is the primary motto of the Raj Bank. (35)
  36. 36. THE EXECUTIVE COMMITTEE Designatio OccupatiSr. Name n on 1 Chair Man Ramnikbhai Sejpal Industrialist 2 Vice Chair Man Bhanjibhai Patel Industrialist 3 Managing Director Ramnicbhai Dhami Advocate Joint Managing ------ 4 Kamalbhai Dhami Director Satyaprakash 5 General Manager ------ Khokhara 6 Director Kiritbhai Kamdar Architect 7 Director Manubhai Nasit Industrialist 8 Director Manharbhai Shah Businessman 9 Director Chandubhai Pamphar Charted Eng.10 Director Jamnadas Faldu Industrialist Chandrakantbhai11 Director Industrialist Patel (36)
  37. 37. 12 Director Govindbhai Khunt Businessman13 Director Dr. Vallabhbhai Hirani Doctor14 Director Gopalbhai Karia Businessman15 Director Shsikantbhai Maheta Builder16 Director Shirishbhai Dhruv Engineer17 Director Madhusudan Donga Industrialist18 Director Muljibhai Chauhan Govt. Contractor19 Director Bakulbhai Zalavadia C. A.20 Director Lilaben Dhami Social Worker21 Director Arunaben Chudasama Social Worker (37)
  38. 38. BRANCH NETWORK & STRUCTURE1 Panchnath Road Branch ( With ATM) “Sahkar Sarita” Panchnath Road Rajkot – 1. Phone : 2233722, 2234454 At Your Service From : 25–11–1980 ( RBI Licence No. ACD.Gj.219 Dt :- 12–08–1980) Mr. D. M. Dave Manager Mr. S. K. Makwana Dy. Manager Mr. N. S. Patel Dy. Manager Mr. S. M. Kalyani Asst. Manager Mr. K. D. Dalsania Asst. Manager2 Dhebarbhai Road Branch Near Trikon Baug, Rajkot – 360 001. Phone : (0281) 2236766, 2227948 At Your Service From : 10-04–1989 ( RBI Licence No. UBD.BL 1937 Dt. 26–10–87) Mr. B. P. Vekaria Manager (38)
  39. 39. Mr. U.S. Padalia Asst. ManagerMr. J. C. Solanki Asst. Manager (39)
  40. 40. 3 Saurashtra Uni. Road Branch (With ATM) Saurashtra Uni. Road, Rajkot – 360005 Phone : (0281) 2573600, 2573601 At Your Service From : 05–04–1993. ( RBI Licence No. UBD. AH/4 Dt. 12–08–1994) Mr. R. S. Boda Manager Mr. V. N. Maheta Asst. Manager Mr. N. R. Boda Asst. Manager Mr. V. H. Chavda Asst. Manager4 Jasdan Branch Jeram Plot, Chitalia Kuva Road, Jasdan – 360050. Phone : (02821) 220830. At Your Service From : 16–01–1996. ( RBI Licence No. UBD. AH/95 Dt : 09-08-1994) Mr. H. T. Joshi Asst. Manager Mr. Z. P. Kalkani Asst. Manager5 Morvi Branch (40)
  41. 41. 1, Kalika Plot, Ravapar Road,Morvi – 363641, Phone : (02822) 230920.At Your Service From : 05-06-1995( RBI Licence No. UBD. AH/96 Dt : 09-08-1994)Mr. S. V. Patel Dy. ManagerMr. M. C. Vadaviya Asst. Manager (41)
  42. 42. 6 Jetpur Branch (With ATM) Kanakai Plot, Jetpur -360 370 Phone : (02823) 223151. At Your Service From : 16-01-1996 ( RBI Licence No. UBD. AH/94 Dt : 09-08-1994) Mr. M. K. Sheth Dy. Manager Mr. V. K. Siddhpara Asst. Manager7 Upleta Branch Raj Marg, Upleta – 360 490 Phone : (02826) 222955. At Your Service From : 15-01-1999 ( RBI Licence No. UBD. AH/334 Dt : 19-06-1997) Mr. S. M. Virapara Asst. Manager Mr. R. J. Lunagaria Asst. Manager8 Gondal Branch Kailash Complex, Kailash Baug, Gondal – 360 311. Phone : (02825) 223143 (42)
  43. 43. At Your Service From : 15-01-1999.( RBI Licence No. UBD. AH/348 Dt : 25-09-1997)Mr. H. J. Pipariya Asst. ManagerMr. R. M. Chuhan Asst. Manager (43)
  44. 44. 9 Sahakar Society Area Branch Hasan Wadi Main Road, Nr. Trishul Chowk, Rajkot – 360 002. Phone : (0281) 2363536 At Your Service From : 26-01-2002. ( RBI Licence No. UBD. AH/610 Dt : 10-08-2001) Mr. K. R. Viradia Dy. Manager10 Raiya Raod Branch Omkar Towers, Opp. Nirmala School. Rajkot -7. Phone : (0281) 2589494. At Your Service From : 27-01-2002. ( RBI Licence No. UBD. AH/608 Dt : 10-08-2001) Mr. D. V. Maheta Manager11 Junaghar Branch (With ATM) “Sardar Bhavan” Maharshi Arvind Marg, Junaghar – 362 001. Phone : (0285) 2621313 At Your Service From : 31-10-2003. ( RBI Licence No. UBD. AH/642 Dt : 28-05-2003) (44)
  45. 45. Mr. Sarfaraz Munshi Asst. Manager (45)
  46. 46. AWARDS & ACCOLADES1) “Zero NPA” excellence bank award given by Mr. Ghanshyambhai Amin2) Sahkar Ratna award to managing director Mr. Ramnikbhai Dhami given By Mr. Jayrambhai patel & Mr. Vallabhbhai Kathiriya3) From beginning Raj bank has been awarding As Audit calls “A” By district register. (46)
  47. 47. CORPORATE GOVERNANCE & RAJ BANK As Co-operative banks come under common law but thenalso the banks have to follow such guidelines of the RBI. Theprudential measures have been stipulated by RBI for the urban co-operative banks according to which the position of Raj Bank is asfollow.Prudential norms of RBI Raj Banks positionCapital adequacy ratio is to Raj Bank has maintain thisMaintain at 9%. Ratio at more then 31%.Prohibition on advance Raj Bank has never madeBeing made to share booker. Such advances.Prohibition on advance Raj Bank has never madeagainst shares & debentures. Such advances.Maxi. 2% debt can be Raj Bank has never borrowedObtain from call money any debt from call money (47)
  48. 48. Market (This 2% will be on market from the date ofthe deposit of the P. Y.) incorporation. (48)
  49. 49. Prohibition to keep fix deposit Raj Bank has never maintain-With other urban co-op. bank. Ed fix deposit with any otherUrban co-op. bank.It is compulsory for non- Raj Bank’s investment inScheduled co-op. bank such type of security isTo invest 15% of NDTL in more then 25%.Govt. approved securities.Scheduled co-op. banks Inspite of Raj Bank isshould compulsorily invest non-scheduled bank, its25% in govt. & other investment in suchapproved govt. securities. Securities are more then 25%. (49)
  50. 50. RELATION SHIP MANAGEMENT The importance of relationship can not be measurable in ourlife. In our life we have to maintain such relation, we can not acrossit. In earlier we use to call it maintenance for relation but now adays it is being called as relationship management. Withoutmaintaining relation, firm can not go further or can not getdevelopment. Because without customer or employee, who will giveimportance to the organization. But an organization needs to keepits eye on every side and need to manage every relation. For everyorganization there are main three relations such as customerrelation, employee relation and social relation. EMPLOYEE RELATION To provide best service to customer it would be difficult taskfor Raj bank if there would not proper human resourcemanagement. In success of any organization, relationship betweenemployee and employee, employee and management employee (50)
  51. 51. and labours etc. should be good. Raj bank takes care it’s employeejust like a family member. And not only looks after their intelligencebut also takes care of there emotional and spiritual quotient. Bankhas maintain healthy relation with there employee, bank also triesto satisfied there need. (51)
  52. 52.  SOCIAL RELATION Bank has maintained health relation with society also.Society consist of other bank, government, businessman etc. bankhas to maintain good relation with societal factor. So by this way forRaj bank relationship management is as important as othermanagement and as a result of good relationship management,today bank has very strong market position and goodwill in society. CUSTOMER RELATION Raj bank believes that customer satisfaction is it’s bestreward by providing best services so customer is a king for Rajbank. Bank always tries to maintain healthy relation with customer. (52)
  53. 53. ServiceOf The (53)
  54. 54. Raj Bank INTRODUCTION It was a time when a function of the banks limited to thecollection saving from the public & lending to the people who are inof money. But in modern age, now it’s not like that , in modern time (54)
  55. 55. banks have become the important part of colony due to the onlyexpansion in the function. One reason for development in bankingfunction is that the developing of the market means today’scompetition & to maintain position in the market banks they haveto develop their services. The modern function or the servicesprovided by the banks are as follows.• To collect spare funds from people’s saving & pay them interest.• To make these funds available to the businessman & industrialist as loan & advance. They charge interest from them.• They also help in assisting international trade by arranging exchange of currency to another one.• Banks render services for the welfare & development of weaker section of the society, they help in setting up small industries, cottage etc.• Banks help farmer to buy tractors & other agricultural equipments, middle class people to buy home appliances like T. V. & provide finance for house. In RAJ Bank out of these services most of services are beingserved. Not only that but also they are providing ATM facility, Cashcard facility, Demand draft facility & many other services. (55)
  56. 56. CURRENT DEPOSIT Current account refers to regularity of transecting in accountwith in banking hours on all working day. The banker’s liability inthis regard is to honor all the demand of the customer to the extentto which his account shows a credit balance. It is because of thisobligation current account deposit is known as bankers demandliability & in order to fulfill this liability they keeps sufficient cashready every moment. A current account is an account which is generally opened bybusinessmen, companies, institutes, corporations, industrialistsetc.• Who have huge working capital in their hand.• Who are interested in keeping money safe.• Who transect with their banker daily.• Who received and make payment usually through cheques.• Who utilize the agency services of the banker frequently• Who are engaged in large scale business activity, social services and government activities. (56)
  57. 57. At present in RAJ BANK thecondition of current account is asunder. No. of depositors total deposit amt. % of total deposit 10,748 30, 32, 78,368.52 10.59% (57)
  58. 58. Features of the current account AndFacilities provided to the currentaccount holder.• Easy Procedures for account opening.• 24 hours banking facility through their ATM centers.• Personalized services & special facility by the way of telephonic inquiry.• Regular bank statement is provided at home through post or E- mail.• Special facility of over draft cleans O.D. & secured O.D. (58)
  59. 59. SAVING DEPOSIT Saving deposit account is an ideal account or those who2have money to save but who can not advantageously invest themany where else as their saving are not of much significance to thecapital market because their saving are too small. This amount istherefore meant of smaller saver. The account is thereforeencourages small saving and tries to forge a saving habit in thegeneral public. The attitude to save is important which this accounttries to create and thus mobilize such small savings for greatersocial good saving deposits account is for that section of societyand put to fruitful utilization. Features of the saving deposit• Restriction on with drawl of amount.• Restriction on deposit of amount.• Payment of interest. At present in RAJ BANK thecondition of saving deposit is asfollows. (59)
  60. 60. No. of depositors total deposit amt. % of total deposit 50,314 71,23,43,463.83 24.87% (60)
  61. 61. Extra features to the saving accountholder of the Raj Bank.• Attractive Rate of interest (3.5%)• Easy procedure for account opening.• 24 hours banking facility through their ATM centers.• Personalized services & special facility by the way of telephonic inquiry.• Regular bank statement is provided at home through post or E-mail.• Attractive computerized passbook.• No charges for saving account holder. (61)
  62. 62. TERM DEPOSIT This account attracts those customers who have moneyinvest for a longer period but do not want to take much of risk.Such person prefers to deposit with commercial banks for aspecified period at a specified rate of interest. The interest ratevaries from one period to another. A deposit of 15 days attracts asmaller rate of interest and deposits for 5 or more years. Thehighest rate of interest. The period for which deposits are to bemade depends upon the depositor himself. However, once adecision is taken by the depositor any money deposit usually he isnot allowed to withdrawal the same before the interest earned tillthat date or accepts a lower rate of interest than stipulated at thetime of deposits. At present in RAJ BANK thecondition of the term deposits is asunder. No. of depositors total deposit amt. % of total deposit 77,750 182,84,67,000.00 63.84% Interest rate structure on fixed deposits. (62)
  63. 63. No. of % of total Between Total deposit amt. depositors deposit 6% to 8% 40,626 49,70,61,053.63 17.35%8% to 10% 17,997 68,02,61,362.86 23.75%10% to 12% 15,365 50,57,25,251.47 17.66%above 12% 3,755 14,54,19,938.10 5.08% (63)
  64. 64. . RECURRING DEPOSIT To encourage regular saving habits in the depositing publicthe bank in the country provide an opportunity to them to saveregularly. According to their capacity and need and earn more thanwhat saving deposit accounts offers to them. The following are themain features of the recurring deposits.• The deposits are made every month of fixed amount say Rs. 5,10,15,25 and so on.• The deposit is made for fixed period say 6, 12,24,36,48,60,72,84, months and so on.• The account can be transfer from one bank to another in the country on request by customer.• This account can be opened by every one competent to enter in to contract including the minor one.• A passbook is supplied to the customer and entry is made there in every month after every deposit.• The account attract higher rate of interest.• The customer is allowed to raise loan against his recurring deposit account to the maximum limit of 75% of the deposit he has made till the date of raising the loan. (64)
  65. 65. As far as concerned with recurring deposits at the Raj Bank,than these are the features are the provided to the recurringdeposit holders.• Easy and simple account opening procedure.• Speedy and timely services.• Account can be opened with any convenient amount,• Attractive rate or interest and special rate for senior citizenship. CHILDREN DEPOSIT The main purpose of such account is to develop a habit ofsaving in student community. The main features of this account areas follows.• The student can deposit a minimum of paisa.• The bank’s branch is usually operated in the school premises.• The student may withdrawal the money as and when they choose to do so.• On a balance of Rs.5 and above interest at saving deposit account rate is allowed. (65)
  66. 66. Features of the children depositscheme at the Raj Bank.• A special scheme for school and college students.• Attractive rate of interest.• Special gift will be provided to them on extra ordinary performance in academic and other curriculum activities.• No withdrawal will be allowed from such account point to maturity.• Attractive passbook will be provided with their printed name on it. (66)
  67. 67. BUSINESS LOAN Any kind of traders, businessmen or a person, who is going tostart a new business, can get business loan. Bank grants businessloan for the purpose of fulfillment or short term working capitalneed in the business. Bank grants this type of loan Rs. 2 lacs to maximum 25 lacs.Bank charges rate of interest as under. CREDIT RATING ROI Prime BLPR + 00.00% AAA BLPR + 00.25% AA BLPR + 01.25% A BLPR + 02.25%  BPLR 10.75% w.e.g. 01-08-2004• A person who is gating business loan he has to mortgage land, building or any other fixed assets.• Document of properties have to be given to the bank by a person. Bank takes all these documents as a security. (67)
  68. 68. • A person has to give reference of two people who are depositor in the Raj Bank as guarantors. NECESSARY DOCUMENTS ARE … Application form, other documents specified in theapplication form, if applicant want mortgage than he need tosubmit the whole file of that assets valuation report of that assets.Proof of guarantor’s income (one time only). MEDICAL EQUIPMENT LOAN• Any registered medical practitioners whose age should be 25 years to 55 years and should have at least one year experience.• Purpose of this loan is to build a new clinic, to purchase other medical equipments or any property for clinic.• Bank grants this loan up to 3 crores.• Rate of interest charged on this loan is 10% to 11%.• As a security a person has to mortgage any fixed assets whose reliable market value is enough in proportion of loan.• Loan repayment period is maximum 6 years. (68)
  69. 69. TERM LOAN It is one of the major sources of debt finance for a long termproject. Term loans are generally repayable in more than a year butless than 10 years. These loans are offered by all Indian financialinstitutions. Term loans are generally secured through a firstmortgage or by way of deposit of title deeds of immovableproperties.• Any business operator for the purpose of purchase necessary building, build a building or purchase a new machinery.• For the purpose of this loan is to invest in long term capital.• Bank grants these loan 2 lacs to 25 lacs.• Rate of interest charged on this loan is 10% to 13%.• As a security a person has to mortgage any fixed assets whose reliable market value is enough in proportion of loan. MORTGAGE LOAN• Any kind or traders, businessmen or an industrialist can get mortgage loan. Bank grants mortgage loan for the any purpose.• Bank grants this type of loan Rs. 50,000 to maximum 10 lacs. Bank charges rate of interest on this loan is 12.5% to 13.5%. (69)
  70. 70. • A person who is gating mortgage loan he has to mortgage land, building or any other fixed assets.• Document of properties have to be given to the bank by a person.• A person has to give reference of two people who are depositor in the Raj Bank as guarantors.• Loan repayment period is 3 years to 7 years.SECURED OVERDRAFT• Any kind of traders, businessmen, personally, professional & industrialist can get secured over draft.• Bank grants secured overdraft for the purpose of fulfillment or short term working capital need in the business.• Bank grants this type of over draft Rs. 1 lacs to maximum 100 lacs. Bank charged interest on this over draft is 10.75% to 14%.• As a security a person has to mortgage any fixed assets whose reliable market value is enough in proportion of over draft.• A person has to give reference of two people who are depositor in the Raj Bank as guarantors. (70)
  71. 71. CLEAN OVER DRAFT• Any kind of traders, businessmen, personally, professional & industrialist can get clean over draft.• Bank grants secured overdraft for the purpose of fulfillment or short term working capital need in the business.• Bank grants this type of over draft Rs.50, 000.• Bank charged interest on this over draft is 12%.• As a security a person has to mortgage any fixed assets whose reliable market value is enough in proportion of over draft.• A person has to give reference of two people who are depositor in the Raj Bank as guarantors. PERSONAL LOAN• Any localize person can get this loan.• Bank grants personal loan for the purpose of purchase fridge, T. V., washing machine or any other thing which can be useful for home management.• Bank grants this type of loan Rs. 10,000 to maximum 50,000 or 70% to 90% of the quotation price of the product.• Bank charges rate of interest on this loan is 11%. (71)
  72. 72. • Applicants need to make such documents of purchase products of purchased product in favor of the bank as a security.• A person has to give reference of two people who are depositor in the Raj Bank as guarantors.• Loan repayment period is 3 years to 5 years. (72)
  73. 73. VEHICLE LOAN• Any kind of traders, businessmen, personally, professional or any person can get this type of loan.• Bank grants personal loan for the purpose of purchase old or new vehicle for personal or business use.• Bank grants this type of loan Rs. 15,000 to maximum 10, 00,000 or 70% to 90% of the quotation price of the product.• Bank charges rate of interest on this loan is 11%.• Applicants need to make such documents of purchased vehicle in favor of the bank & in RTO applicant need to register as a hire purchased vehicle as a security.• A person has to give reference of two people who are depositor in the Raj Bank as guarantors.• Loan repayment period is 3 years to 7 years.• Quotation of vehicle, proof of guarantor’s income (one time only), RTO certificate & other documents are required with the application form. (73)
  74. 74. LOAN AGAINST NSC, KVP, LIC.• Any person who should have share certificate on his own name or any LIC policy holder.• Bank grants loan for any purpose.• Bank grants this type of loan 70% to 90% of the price of the NSC, KVP, LIC.• Bank charges rate of interest on this loan is 11.50%.• Applicant need to give share certificate or LIC policy.• Applicant has to repayment this loan within the due date of that certificate or policy.• Application form, other documents specified in the application form and if an applicant has to give Share certificate or policy than need to sign in favor of the bank. (74)
  75. 75. . HOME LOAN• Any localize person can get this loan.• Bank grants personal loan for the purpose of purchase or to build home.• Bank grants this type of loan Rs. 15,000 to maximum 15,00,000 or 70% to 90% of the price of the home.• Bank charges rate of interest on this loan is 11.50%.• Applicants need to make such documents of purchased home in favor of the bank & bank takes all the documents as a security.• A person has to give reference of two people who are depositor in the Raj Bank as guarantors.• Loan repayment period is 3 years to 15 years.• Application form, other documents specified in the application form and if an applicant want to mortgage any assets than he need to give whole file of that assets and title report through advocate approved by bank only proof of guarantor’s income (one time only). (75)
  76. 76. SAFE DEPOSIT VAULT Safe Deposit Vault (locker facility) At Raj bank there is a proper locker department at groundfloor here locker facility has been providing to the customer.Customer can keep all the ornaments, important documents andmany other papers and many things. For every bank this facility isbecome just like primary function and for providing best customerservice Raj bank is managing this service too. Any shareholder or depositor can easily get their personallocker of bank. There are mainly three types of lockers at Raj bankSmall size locker, Medium size locker, and large size locker. And forto maintain best services Raj bank has different department andenough staff for locker department. Different charges and depositsfor different locker are as under. Types of locker Yearly rent Deposit Small 200 5000 Medium 250 10000 (76)
  77. 77. Large 300 15000 (77)
  78. 78. And for the management of thislocker department they are mainlyfollow these activities.• They have locker attendance register in which the identification, address, full name and signature of locker holder are being maintained.• Before any locker holder open his/her personal locker the staff member has been verifying the signature of that parson and than they allow him to open locker.• They are also maintained time register in which the entry time and exist time a locker holder is being written. So this is very essential function for Raj Bank. CASH CARD FACILITY Cash card facilities totally new and plastic product is startedby only Raj bank among the nation by cash card any customer can (78)
  79. 79. every with drawl amount up to Rs. 15000 from ATMs by cash card.There are no charges for cash card and in also one silent feature isthere is no minimum balance require for cash card system. It is aunique facility of Co-Operative bank of Rajkot ltd. Cash card is giveninstead of token for the payment of cheques. (79)
  80. 80. ATM FACILITY ATM has given a new dimension to banking by giving rise toself service banking. Customer have long been constrained byconventional banking services which have been characterizedgenerally by fixed location and fixed timing on the other hand.Customers not desiring to keep much money on them expect theirmoney to be available to them. Whenever and wherever they needmoney, 24 hours banking services is available for any time. ATMcan be used for withdrawal of cash. For Raj bank it is a matter ofgreat proud that it is pioneer in introducing ATM in the entireSaurashtra region in Co-Operative banking sector. At present Rajbank has four ATM. By this ATMs any customer can easilywithdrawal maximum 10000 per day. CHEQUE DEPOSITORY SERVICE (80)
  81. 81. For the purpose of providing best customer service withadvanced technologies to their customer, Raj bank has also startedCheques depository service through cheques depository machine.This service provided to the customer 24 hours of 365 days. CDM thfacility started on 17 July 2004 at main branch. Now any customercan easily deposit cheques through CDM at any time and any daywithout filling big slips and without standing in big queue. (81)
  82. 82. H. R. M. AtThe (82)
  83. 83. Raj Bank INTRODUCTION Human resources in any organization, be it public private ofCo-Operative constitute perhaps the most vital assets of thatorganization. An organization will fail if its human resources are notcompetent to execute the work assigned to them. There is nogetting away from fact that human resources represent asubsystem which dominates all other sub system to theorganization. (83)
  84. 84. Moreover, people are the only assets of an organization thatappreciate over a period of time while all the other assetsdepreciate. The more an organization is investing in humanresources, the greater the return from the investment is likely to beand it has been rightly pointed to in one of the books of international Co-Operative alliance “The gains accruing out of structuralreforms can be best capitalized only it the personnel maintained bythe Co-Operative institution are in a position to execute the policieseffectively”. This implies the need and necessity of proficient andcapable human resources which is on e of the primary aims of hthuman resource management. According to national institute of personnel management ofindia “Personnel management is that part of managementconcerned with people at work and with their relationship within theorganization it seeks to bring together men and women who makeu an enterprise enabling each to make his own best contribution toit’s success both as an individual as a working group.” (84)
  85. 85. H. R. POLICY AND PROGRAMMES A sound foundation for selection of the right kind of humanresources is laid with the formulation of sound human resourcespolicies. According to William R. Spiegel a human resources policycan be defined as, “A body of principles and rules of conduct thatgoverns the enterprises in it’s relationship with it’s employees. Thusthe sound personnel policies set the tome for proper administrationof the personnel programmers, So as to achieve the objective of theorganization. As Raj Bank is one of the leading Co-Operative bank in theCo-Operative sector, though its performance is very good but thanalso such policies for human resources they can not make by theirown. It has to follow the rules of policies given by the governmentand RBI so in the matter of the personnel policies Raj Bank isrestricted to some level. Than also the bank have adopted a policyof recruiting only CA and MBA for their management level for bettermanagement. So, by this way where they get chance they aremaking or improving personnel policies at Raj Bank. (85)
  86. 86. (86)
  87. 87. The next important stage in the selection process is thehuman resource planning. “Planning applied in the field ofpersonnel” it is the comprehensive and on going process. Broadlyconceive human resource planning as Thomas H Patten Jr. states,“Human resource planning is process by which an organizationensures that it has right no. and kinds of people in the right place atthe right time doing the things which they are economically mostuseful.” In the Raj bank there is a very educated staff as it isconcerned with the human resource planning recently they hasadopted policy of selection only C.A. & M.B.A. For their humanresource has as far as concerned with the human resourceplanning. There is no long term planning but at a time orrequirement of staff they used to recruit staff either out side or fromwith in the firm through transfer or promotion. (87)
  88. 88. RECRUITMENT Among the function of human resource manager, one manfunction is to procure best people for their organization, meanssearch of prospective employees to suit the job recruitment. A firmhas to pass through well and good recruitment process for havingbest human resource this recruitment can be possible throughmany sources. A firm can recruit proper candidate mainly throughtwo success recruitment sources these are as under. Recruitment SourcesInternal sources External sources1) Transfer 1) Advertisement2) Promotion 2) Education institutes3) Relative & friends 3) Placement agencies 4) Labours contractor In case of Raj bank, the main source or recruitment is dailynews paper advertisement. They also recruit employees by transferand promotion. Generally as per the recruitment of the job they giveadvertisement in newspaper and collect the pool of application. (88)
  89. 89. SELECTION Managing people is not easy but it can be made easier if youmake sure that you have selected the right people in the first place.And also it said that “selection of people is easy but selection ofright people is difficult task.” The selection procedure is concernedwith securing relevant information about an applicant is secured.The objective of selection process is to determine whether theapplicant meets the qualification for a specific job and to choosethe applicant who is most likely to perform well in that job. Thus an effective selection program is a non random processbecause those selected had been choose on the basis of theassumption that they are likely to be “better” employees then thosewho have been rejected. Selection process or activities typicallyfollow a standard pattern being with an initial screening ofapplicant, interview and concluding with final employment decision.The selection procedure of raj bank is quit simple. The stages ofincluding in the selection process are as follows. New paper advertisement Receipt of application (89)
  90. 90. ScreeningArrangement and interview SelectionPlacement and confirmation (90)
  91. 91. ORIENTATION After the selection of employee, management of the firm hasto pass through such process. So new employee can be aware ofthe atmosphere of the firm and also can be familiar with the otheremployee. This process is called orientation or induction. In anyorganization this process performs very vital role because this is theonly process which can create better environment in theorganization and a new comer can be aware about his workingcondition, his area of responsibility and everything aboutorganization. Proper orientation process can be beneficial to both, anew comer as well as organization. PLACEMENT Once an employee has been selected he should be placed ona suitable job. Putting the right man at the right job is as importantas hiring the right person. Placement is a process of assigning aspecific job to each one of the selected candidates. It involvesassigning a specific rank of and responsibilities of an individual. Itimplies matching requirement of a job with the qualification of acandidate. (91)
  92. 92. In other words, “placement is the determination of the jobwhich an accepted candidate is to be assigned and his assignmentto the job.” As Raj bank is very careful about this process. And onething is that, at the time of requirement only they hire newemployees. So hire it is specified that for which job they arerecruiting. After the final selection, they have been marking the jobof the new employee. EMPLOYEE REMUNERATION Remuneration is the compensation an employee receives inreturn for his or her contribution to the organization. Remunerationoccupies an important place in the life of an employee. Standard ofliving of employee, states in the society, motivation, loyalty andproductivity depends upon the remuneration. For the employeeremuneration is significant because of its contribution to the cost ofproduction. For human resource management, remuneration is themajor function. The HR specialist has a difficult task of fixing wagesand wage differentials acceptable to employee and their leaders.There are mainly 3 three components of employee remuneration.These are as follows….. (92)
  93. 93. 1) Wages and salary, 2) Incentives and 3) Non monitory benefits. As far as it is concerned with the Raj bank, there is a specificpolicy of employee remuneration formed by RBI and govt., and itself also. So and also for the management of employeeremuneration there is a specific administration department whichcares of wages and salary and all things about remuneration. WAGES & SALARY :: - Wages represent Hourly rates of pay and, salary refers to themonthly rate of pay irrespective of the number of hours put by anemployee. Wages and salaries are subject to annual incrementsthey differ from employee to employee and depend upon the natureof job seniority and merit. INCENTIVES ::- Incentives are also called ”payment by result” are paid inaddition to wages and salaries. Incentives depend uponproductivity, sales, profit or cost reduction efforts there are.1) Individual incentive schemes and2) Group incentive program Individual incentive are applicable to specific employee areapplicable to specific employee performance. Where a given taskdemands group effort for completion, incentives are paid to the (93)
  94. 94. group as a whole. The amount is later divides among incentivesrefer to variable rewards granted to the individual in terms ofchanges in specific results in organizational setting besides wagesand salaries, employees are paid incentives depending upon theirperformance. Incentives payment is quite substantial and is paid asregularly as wages and salaries. The primary advantage ofincentives is the inducement and motivation of workers for higherefficiency and grater output. It option schemes and the likeperquisites are offered to retain competent executives. NON MONITORY BENEFITS ::- These include challenging job responsibilities. Recognition ofmerit, growth prospects, competent supervision, comfortableworking condition and job sharing. As far as Raj Bank is concerned that is specified departmentwho cares about employee remuneration. Apart from salaries theyare also provides bonus (one month salary) also provides providentfund scheme and gratuity and also VRS scheme, group insurancetoo. (94)
  95. 95. TRAINING & DEVELOPMENT Training is the process of increasing the knowledge and skillsfor doing a particular job. It is an organized procedure by whichpeople learn knowledge and skills for a definite purpose. Thepurpose of training is basically to bridge the gap between jobrequirement and present competence of an employee. Training isaimed at improving the behavior and performance of a person. It isa never ending or continuous process. In any organization theirshould be proper training program to improve employee resources,as well as organization development. Training involves helping anindividual learn how to perform his present job satisfactorily. On the other hand development is long term educationprocess utilizing a systematic and organized procedure by whichmanagerial personnel learn conceptual and the critical knowledgefor general purpose. So in the any organization the importance ofthe training and development is very vital, nobody can ignore it. Asfar as it is a continuous process there. Raj bank is working withadvanced technologies. At every step better training anddevelopment is required. At present every employees of the firm are getting trained byits own EDP department n advanced computer technologies. They (95)
  96. 96. are also organizing internal seminar for improvement of the firmand also they are sending their employees outside likeGandhinagar, Ahmnedabad,Delhi, Pune and Mumbai to oo for thebetter development. As it is banking firm there is continuoustraining and development program organized by other banking firmand association for improvement of whole banking sector in India. PROMOTION AND TRANSFER Mobility and flexibility in the workforce are necessary to copewith the changing requirement of an organization. Job changesprovide necessary flexibility, employees move from one job toanother one through transfer, promotion. So the importance ofemployee movement in the organization in very important. Promotion:: - Promotion refers to advancement of an employee to a higherpost carrying grater responsibilities higher status and better salary.It is the upward movement of an employee in the organization’shierarchy to another job commanding grated authority higher statusand better working condition when an employees is assigned ahigher level job with more pay and powers he is said the promoted (96)
  97. 97. promotion may be temporary or permanent depending upon theneeds of the organization so this is just like tool which can beuseful in two way one way it is a motivation second way it becomesa source of recruitment from with in a organization so thepromotion in the organization is who is present as other activities incase of the Raj bank as it is Co-Operative sector they have to followpromotion policy of government is merit cum seniority in case ofpromotion they are not independent too. (97)
  98. 98.  Transfer: :- A transfer refers to a horizontal or literal movement of anemployee from on a job to another in the same or organization without any significant change in status any pay. It has defined as “ Aliteral shift causing movement of individual from one position toanother. Usually without involving any marked change in duties asresponsibility will needed of compensation. The need for transfermay grid due to several reason transfer mane of which the followingobjective.• To meet organizational need• To satisfy employee needs• To better utilize employees• To make the employee more versatile• To adjust the work force• To provide relief• To punish employees. The transfer is beneficial in many ways the benefits of thetransfer is as under• Increase in productivity and effective need of the organization.• Greater job satisfaction to employees• Stabilize fluctuation work needs• Improve employee skills (98)
  99. 99. • Remedy for faulty placemen• Develop employees for further promotions• Avoid monotony and boredom. So, the transfer is also important as far as concerned withRaj bank there is no specific transfer policy but according torequirement and for convenience of the employee they use to maketransfer. (99)
  100. 100. Marketi ngDepartme nt (10 0)
  101. 101. AtRajBank (10 1)
  102. 102. INTRODUCTION Today, marketing is spread in every field of like hospitals,services, goods even politics and many more. In banking sector toothe importance of marketing also can not measurable, still it hasnot developed in public sector it is only limited to foreign banks andprivate sector. The reason for success of foreign in India is only bestmarketing efforts. Today in banking sector there is a cutthroatcompetition among public sector, private sector and foreign bank. Marketing is a human activity directs at satisfying the needsand wants of customers, there are five stages of bank marketingfirstly marketing g is advertising, sales promotion and publicity,secondly marketing is smiling and Co-friendly atmosphere, thirdlymarketing is innovation like the ATMs or cheques with drawls onfixed deposits, fourthly marketing is positioning. When all banksadvertise and innovate, they look alike so, they should try toposition themselves differently, even through symbols, logos oraggressive advertising so that the customer can distingueebetween one bank and another and finally marketing is analyzing,planning and control. (10 2)
  103. 103. At Raj bank though there is no specific marketingdepartment. for marketing of different services but providing vestservices to their customers and getting good customer satisfaction,and doing such efforts of marketing like promotion activities theyare in directly getting benefits of the marketing. Today they are alsoplanning for such continuous marketing efforts. And with in the fewyears they will have aggressive marketing department. (10 3)
  104. 104. PROMOTIONAL ACTIVITIES Promotion tools are also essential in the bank’s marketingmix. We need personal selling in customer contact, development,personal service. And so on. Similarly, bank marketing programneed advertising as mass communication tool. The bank is asponsor. It sends a message to prospective buyers (the audience)by means of a medium (The carrier of the message). Anadvertisement in bank marketing is a promise3 a promise ofsatisfaction to prospects who buy or use the service offered by thebank or who are willing to patronize the bank. Banks are using allmedia of advertisement such as newspaper, radio television,magazines etc., for advertising their services and for getting thebusiness. Bank marketing also uses sales promotion devices suchas point of purchase materials, advertising specialties (ball pens,calendars, diaries, notes pads etc.) brochures and bookletsdescribing bank services, etc. a bank has also to use public relationas mode of promotion to build up and maintain its bright image inthe community. As far as it is concerned with promotion activity than Raj bankis not doing any personal selling but bank is believe in very stronggoodwill and also best customer satisfaction they are usingadvertising they are giving their advertisement in news paper like (10 4)
  105. 105. Sandesh, Gujarat samachar etc. and also in banking magazine andfor publicity they are organizing such shows like recently they haveorganized three bug shows. First in Morvi and second and third inRajkot with Sunidhi Chauhan and Anu Malik and second with greatAndnd Murti Guruma. By this way be using very simple and lessexpenses tools of marketing like advertising and publicity. They aregetting goods response from society and for Raj bank work of workof month is their best publicity. (10 5)
  106. 106. MARKETING RESEARCH AND INFORMATION Good marketing decisions are not made in a vacuum. Hence,even in bank marketing. We need marketing research andinformation to enable bank executive to make sound decisions. Theincrease in the use of marketing research in bank marketing is dueto two forces: competition pressures to be right, and Customer –orientation in marketing planning and program. Banks are nowestablishing a separate marketing organization. Conductionmarketing research, setting up sales training program and adoptingsales promotion divides promotion devices to attach customer wehave special bank advertisement through radio. T.V. andnewspapers. Marketing research may be defines as “The scientificand controlled process of gathering of none routing, marketinginformation, helping management to solve marketing problems.” As far as it concerned with the marketing research process atRaj bank. They have been continuously doing such research frombeginning. But one positive point for marketing research is that theynot doing any big expenses for marketing research and for (10 6)
  107. 107. executives. Bank’s staff member themselves goes to market andgathers requited information or data. Such information or data theyare collection from direct RBI or other banks. So, by this way theyare getting benefits by using marketing research process. (10 7)
  108. 108. FinanceDepartme nt At (10 8)
  109. 109. RajBank (10 9)
  110. 110. INTRODUCTION Finance is the fuel of administration. Without adequatefinancing no business enterprise can raise its potentials for growthand success. And it would be worthwhile to recall what “Henry Ford”once remarked “Money is an arm or leg. You either use it or lose it.”This statement though apparently simple and quite meaningful, itbrings home the significance of money or finance. In the modernmoney oriented economy finance is one of the basic foundations ofall kind of economic activities. Finance management is indeed the key to successfulbusiness operations. Without proper administration and effectiveutilization of finance, no business enterprise can utilize it’spotentials for growth and expansion. Organization and control ofthese function is important for all types of business units. Speciallyin public undertaking massive investment has so far been muchless productive, it is necessary to organize the finance functioningsuch a manner that should help the business in achieving it’s basicobjective with minimum cost. (11 0)
  111. 111. According to Hoagland “Financial management is concernedmainly with such matter as how of business corporation raises it’sfinance and how it make use of that.” (11 1)
  112. 112. FINANCIAL PLANNING Planning is very necessary for the smooth running of thebusiness can not be carried on without planning. Planning meansdeciding in advance what is to be done for each functional area ofmanagement. The planning of each area should link to theobjectives of the organization. Financial planning means deciding inadvance the financial activities to be carried on to organization. So,the basic purpose of financial planning is to make sure thatadequate funds are raised at minimum cost and they are usedwidely. A proper planning of the business on one hand and to allowa fair return to their contribution on the other.Thus financial planning includes thefollowing …1) Determination of financial objectives.2) Formation of financial policy.3) Development of financial procedure. (11 2)
  113. 113. In Raj Bank, the financial planning has been done throughproper management in various areas like liquidity planning,investment planning, profit planning, cash management etc. (11 3)
  114. 114. CAPITAL STRUCTURE OF THE RAJ BANK Capital structure decision is yet another important area underfinancial management. Capital structure refers to the mix orproportion of firm’s permanent long term financing represented bydebt preference must ensure the maximization of wealth ofshareholders so even the capital structure decision must be takenin the light of wealth maximization objectives. That particular mix ofdebt and equity which maximizes the value of the firm is known asoptimum capital structure in simple word capital structure refersto the composition of capital.Capital structure = Long term debts + Preference share capital + Equity share capital + Reserves. 1. Capital Rs. 4,60,00,000.00 2. Reserves & surplus Rs. 45,41,50,000.00 3. Deposit Rs. 2,86,41,00,000.00 4. Borrowings Nil 5. Other liabilities & provision Rs. 2,70,00,000.00 (11 4)
  115. 115. CAPITALIZATION Capital plays an important role in any business at the time ofcorporation of the business, it is the first problem before promotesto decide how much capital is to be required and in what form. It isnot an easy task. A financial plan is to be prepared form thepurpose of explaining the abort term and long term needs offinance to the company. Sever consideration would be kept in mindsuch as cost of capital fair return to the contributors of capita riskinvolved flexibility etc. while taking decision in this regard it requiredproper capitalization. Proper capitalization reveres to the total amount of capitalrequired in the long run to run the business smoothly capitalizationuses in its quantities aspect and reveres to the amount at which acompany’s business can be valued most of the traditional authorsdefine the terms in this sense the sum total of the par value of allshare. After definition of capitalization are being reproduces belowin order to understand the term well. E.F. Lincoin, The amount of capital at any time should notexcepted none should it be less than the amount required in both (11 5)
  116. 116. situation it there firm will be loser. These conditions are calledunder capitalization and for capitalization. In case the amount ishiring than it is required the company his have to pay more intereston the surplus capital are they rescuing the proper of the concernof the total capitalize not sufficient to discharge the function of thebusiness the concern with not be in a position of even reasonableprofits due to lack of funds it is there fore, necessary to have propercapitalization. (11 6)
  117. 117. CASH MANAGEMENT Cash is the medium of exchange which allows managementto carry on the various activities of the business on day to daybasis. And management of cash is one of the most importantanswers of over all working capital management due to the farethere cash is the most liquid type of current assets. As such it is theresponsibility of the finance function to see that the variousfunctional areas of the business have sufficient cash were everthey require the same at the same time if has also it be ensuredthat funds are not blocked in the form of idle cash as the cashremaining idle also involves cost in the form of interest cost andopportunity cost as such the management of cash have to kind amean between these two extremes of shortage of cash as well asidle cash. The basic objectives of cash management of are to reducethe operating cash balance requirement to maintain possible extentwithout affecting the routine transaction. For the management ofcash flow statement is the most important tool cash low statementprovided information about the cash ratio and payment of a firm for (11 7)
  118. 118. again period. It provides important information that complimentsthe profit and loss account and balance sheet. (11 8)
  119. 119. RATIO ANALYSES Financial analyses of an organization depend to a largeextent on the use of ratios. The technique is commonly known asfinancial ratio analyses. Ratio analyses is a very powerful analyticaltool useful for measuring performance of an organization the ratioanalysis helps the management to analyses the past performanceof the firm and to make further projection. Ratio analysis is aprocess of comparison of on figure against the calculation of ratiorelatively easy and simple task but the proper analyses andinterpretation of the ratio can be made only be the skilled analysis.The ratio of The Raj Bank of the last year is as under. (11 9)
  120. 120. (120)
  121. 121. FINANCIAL INFORMATION The liberalization of the financial sector is the key for the overall liberalization process. Gradually, the structure of the financialmarket itself has begun to change, in the changing FinancialMarket; The Co-Operative Bank Of Rajkot Ltd. has market theprogressive growth and profitability both the financial year 2004-2005 which is reflected in the following Financing since inception: (Rs. In Lacs) Particulars 31-3-04 31-03-05 Members 27,400 29,100 Share Capital Rs. 475 Rs. 480 Deposit Rs. 2620 Rs. 2860 Advances Rs. 1120 Rs. 1420 Net Profit Rs. 805 Rs. 810 Working Capital Rs. 28100 Rs. 32425 (12 1)
  122. 122. PROGRESS REEPORT NET PROFITAMOUNT (Rs. In Lacs) 1000 780 805 810 750 500 250 0 2003 2004 2005 YEAR INVESTMENTS 200AMOUNT (Rs. In Crore) 147.5 150 125.5 130 100 50 0 2003 2004 2005 YEAR (12 2)
  123. 123. DEPOSITS AMOUNT (Rs. In Lacs) 286 300 262 212 200 100 0 2003 2004 2005 YEAR ADVANCES 200AMOUNT (Rs. In Crore) 150 142 112 100 92 50 0 2003 2004 2005 YEAR (12 3)
  124. 124. NPA & RECOVERY MANAGEMENT The core banking business is of mobilizing the deposits andutilizing if leading to industry. Leading business is generallyencourages because it has the effect of funds being transferredfrom the system to products purposes which results into economicgrowth. However leading also carries credit risk which arises fromthe failure of borrower to fulfill its contractual obligation. Meaning of NPA ::- An asset is classifies as non performing assets (NPAs) ifdues in the form of principle and invest are not paid by theborrower for a period of 180 days however with effect from march2005 defaulters would be differs to a borrower if dues are not paidfor to days if any advance or credit facilities arranged to thatborrower is non performing with out having any regard to the factthat there may still exist certain advances credit felicities havingperforming status. (12 4)
  125. 125. As the Raj Bank is concerned than there is gross NPA is“ZERO” since beginning and net NPA is also very nearest to ZERO.Today the net NPA is 00.26%. And for managing this NPA theyconstantly affording for the best and also the have centralizeddepartment for advances this is one of the result for having ZERONPAs. And before granting any loan they used to concern the repaycapacity of the applicant and for granting the loan every branchhead a power to grant loan up to 2,00,000 lacs only. But more tan that amount that loan only by a permission of amain branch and management will grant and for they used to makecredit report of that person in that report the name, history,business, annual income and other information to be prepared byC.A. of the bank or other staff members. And step by stepprocedure takes place. And for recovery they have very strongdepartment. But according to them they only care at a time ofgranting the loan so, they have no need to very strong recovery andfor recovery these are the steps followed by the bank. First by thetelephone and that bank notice and than personal visit and tannotice through advocate and lastly they do government procedurethrough court. (12 5)
  126. 126. RISK MANAGEMENT Risk management is the strategic tool, which helps Iidentifying, quantifying, monitoring and controlling risk. Riskmanagement protects an organization from dying due to insolvencyresulting from the adverse effects of risk. Though universallyrelevant it is of immense importance to a banking organization orfinancial institution. In view of the same Risk management isanalysis here from the banking perspective. However with largecorporate house establishing their own independent dealing rooms,risk management systems are no longer limited to bankingorganization. Classification of Risks:- Risk normally has to dimensions i.e. the quality of risk andthe quantity or risk. Quality of risk is essentially the probability ofthe risk during into an actual loss. Quantity of risk is the financialeffect of the risk turning into a loss. Both these dimension areextremely difficult to measure, primarily because it is an estimationof the future, which is highly uncertain. To understand risk (12 6)
  127. 127. management it is extremely important to understand the varioustypes of risks, their characteristics and their inter relationships. (12 7)
  128. 128. • Liquidity Risk:- Liquidity risk is essentially a result of adverse movements ofother risks i.e. credit risk, interest rate risk, foreign exchange risk.Small information in the market about the liquidity problems facedby a bank may result into withdrawal of enormous deposits, therebyaffricating the problem. Liquidity risk also includes rising of funds atan abnormal cost to need its commitments. Management ofinterest rate risk and liquidity risk is together knows as assetsliability management. Thus asset liability management is a subsetof the whole gamut of risk management tools.• Credit Risk:- Credit risk is the most fundamental risk faced by a bankingcompany. Credit risk is the risk of default by a borrower of funds ordecline in the credit standing of a borrower. It is the most difficult toquantify due to the large amount of subjectivity involved in it. Thuscredit risk management can assist in decision making; it can not bea substitute to the judgmental decision of a credit officer.• Market Risk:- (12 8)
  129. 129. It is the risk of loss due to adverse movements in the marketrates during the compulsory holding period having an impact on theportfolio held by market is also important in constantly determiningthe true worth of a collateral security provided by the borrower.Foreign exchange risk is often regarded as a part of the market risk,but may be bifurcated for facilitating better analysis. S. W. O. (12 9)
  130. 130. T. Analysis STRENGTHS ::-• Net NPA Zero since inception.• Professional management & Co-Operate team spirit.• Strong Brand equity.• Fully computerization and Automation.• Respectable ranking and position in Gujarat’s top Co- Operative banks.• Profitability and sound liquidity.• Branches in all most developed parts of saurashtra. WEAKNESS ::- (13 0)
  131. 131. • Lack of marketing expertise.• Lack of modern management concepts.• Sometimes communication gap is found which signs lack of professionalism.• Lack of scheduled status which may affect expansion of their business.• Lower volume of advances due to higher rate or interest.• Strong need for a more disciplines, smooth and sophisticated.• Environment for working and customer service. (13 1)
  132. 132.  OPPORTUNITIES ::-• General insurance business at higher level.• No. of branches can be increased in all overall state.• After getting scheduled status we may apply multi state bank to expand their business.• Introduction of various retail services.• Tax consultancy can be provided by using the skills of the professional personnel and experienced seniors. THREATS:-• Confidence crises in the co-operative banking sector can disturb the bank’s progress.• Changes in govt. rules and regulation.• Cut throat competition and entry of new foreign bank and its sound financial structure. (13 2)
  133. 133. Future Plan of (13 3)
  134. 134. RajBank (13 4)
  135. 135. VISION - 2010• To maintain excellence in operation & management by bringing I transparency & integrity.• To emerge as symbol of public trust & confidence by creating a positive image.• To ensure speedy & satisfactory customer services through continuous product innovation & aggressive, marketing strategies.• To adopt policy for technological up gradation& advancement to boost up total computerization & inter branch connectivity for all the branches.• To develop & motivate human resources there by cultivating processional culture in the banking operations.• To strive for continuous growth & profitability through branch expansion & modernization.• To introduce more ATM centers & various “plastic products” for better customer services.• To maintain the asset quality at the optimum level by continuous efforts for credit risk management.• To provide multi dimensional services to customers by incorporating various modern service areas like insurance, bill collection and providing one door service to clients. (13 5)
  136. 136. • To explore more non-fund based business like latter of credit, bank guarantee, custodial services to increase bank’s non interest income.• To achieve business turnover of Rs.650 cores & net worth of 80 cores by 2010.• To continue to maintain the NET NPA at ZERO level.• To plan Bank’s balance sheet with judicious ALM. (13 6)
  137. 137. Suggesti on To (13 7)
  138. 138. RajBank (13 8)
  139. 139. SUGGESTION As improvement is a constant requirement for every one andif we try to learn from a little things also. Than every minute we willimprove ourselves. And for constant improvement in organizationmanagement should keep their eye on every concern, during myvisit at bank I have tried to cover everything and according to myknowledge I am trying to give suggestion to the Raj bank and I amsure that it surely will be helpful in progress of the bank. First and foremost suggestion for Raj bank is that, yet theyare not using such marketing tools in the area of cutthroatcompetition in banking sector. Each bank should try for better anddifferent marketing. Raj bank should make one group of executive,who can help to the management and can provide differentservices like collection from home only and they should use suchslogan for innovative products like “only one call can make your lifebetter.” This slogan can be sued for assets product. So by using notonly simple advertisement but also strategic marketing tool bankcan improve a lot in the market. (13 9)
  140. 140. And last but not least that is there is need to improve website of Raj bank during my report work I have found very poorcontents in the web site of Raj bank as Bank have their own EDPdepartment with high educated staff. And by creating attractive website bank surely will be able to create good image. And one thing isalso there should professionalism in management at every level. (14 0)
  141. 141. C O N C L U SIO (14 1)