REPORT OF THE BOARD OF DIRECTORS : 2015-16

I. MANAGEMENT DISCUSSION AND ANALYSIS

1. GLOBAL ECONOMY

The global economic outlook has remained under clouds of uncertainty for long, with periodic financial market turbulence and heightened risk aversion. The global economy is expected to grow at 2.9% in 2016-17 and 3.1% in 2017-18. The US economy slowed in the second half of 2015 as the Private sector has cut back capital investment in the face of an inventory glut. Industrial production remained in contraction mode in Q1 of 2016. In the Euro area, growth decelerated in Q4 of 2015 due to sagging exports, though private consumption was boosted by low oil prices and favorable financing conditions. Growth in the Japanese economy suffered a setback in Q4 of 2015 with the fall in private consumption. The UK economy picked up in Q4 of 2015, driven by its service sector. In Emerging Market Economies (EMEs), the overall macroeconomic environment remains challenging with growth having weakened further in recent quarter. The Chinese economy recorded lowest quarterly expansion in Q4 of 2015 since 2009, with downside risk looming large in terms of weak external demand, factory overcapacity, slowing investment and high debt levels.

Global inflation pressure was contained by weak global growth and continuing softness in commodity prices. Monetary policy stances have been diverging across both AEs (Advanced Economies) and EMEs. In Dec 2015, the Fed raised its policy rate. The European Central Bank (ECB) reduced the deposit rate further into negative and cut its policy rate to zero. The Bank of Japan (BOJ) while maintaining its quantitative and qualitative easing program introduced a negative deposit rate. China has aggressively cut deposit and lending rates.

2. DOMESTIC ECONOMY

As per the advance Estimate (AE) released by the Central Statistical Office (CSO) the growth rate of GDP at constant market prices was projected at 7.6% in 2015-16. Growth in the agriculture sector in 2015-16 had continued to be lower than the average of last decade at 1.1%, mainly on account of it being the second successive year of lower than normal monsoon rains. Growth in the service sector moderated slightly at 9.2% but still remains robust. Growth in industry is estimated to have accelerated during the current year at 7.3% on the strength of improving manufacturing activity.

The Index of Industrial Production grew by 2.4% in 2015-16 (April- March). Inflation remains under control. The new series inflation has fluctuated around 5.5% while measures of underlying trends -core inflation, rural wage growth and minimum support price increases - have similarly remained muted. CPI inflation for the March 2016 stood at 4.83%. The WPI inflation has been in negative territory since Nov 2014which is attributed to large falls in international commodity prices, especially crude oil. WPI remained at (-)0.85% during the year 2015-16.

During the year 2015-16, India's exports and imports stood at $ 261.14 billion and $ 379.60 billion respectively. India's exports declined by about 15.85% and imports by 15.28% during 2015-16.The foreign exchange reserves have risen to $360.2 billion in 2015-16 from $341.6 billion in 2014-15. Net FDI inflows have grown from $21.9 billion in April-Dec 2014-15 to $ 27.7 billion in the same period of 2015-16. The nominal value of the rupee, has declined against the dollar. The CAD (Current Account Deficit) narrowed to 1.4% of GDP in April- Dec 2015 from 1.7% in the corresponding period of 2014-15, on the back of the contraction in the trade deficit. Fiscal deficit in RE (Revised Estimates) 2015-16 & BE (Budget Estimates) 2016-17 are retained at 3.9% and 3.5% respectively in the union Budget.

In the bond market, yields on govt securities (G-Secs) which had started to ease ahead of the monetary policy easing cycle, got increasingly disconnected and firmed up through the second half of 2015-16. After the Union budget, 10 year generic yield declined by about 16bps on Feb 29, 2016. G-Sec yield edged up in the first half of March 2016 on profit booking by market participants. Liquidity conditions generally tightened in the second half of the year beginning from mid Oct as the pace of government expenditure slowed and the seasonal increase in currency demand for the festival season took hold.

RBI conducted open market operations to ease the liquidity condition. The performance of banking sector during 2015-16 remained subdued. Growth in the Gross bank credit is tepid at 11.3% and aggregate deposit also grew at 9.9% as on March 18, 2016. The asset quality of banking sector came under stress and GNPA as proportion of Gross Advances has increased in Dec 2015. RBI, in all, made substantial repo rate cuts of 125 bps between January 2015 & March 2016. Growth of Money supply (M3) on Y-O-Y as on 31st Mar, 2016 stood at 10.3% as compared to a growth rate of 12.0% recorded in the corresponding period a year ago.

II. PERFORMANCE OF THE BANK DURING 2015-16:

1. UCO's Delivery Channels:

1.1.BRICK and MORTAR Network:

Bank has a geographically well spread branch network in India and abroad. The Bank has 10 Circle Offices, 49 Zones, 3073 domestic branches and 4 overseas branches (two each in Singapore and Hong Kong), as on 31.3.2016. The Bank has two Extension Counters as of 31st March, 2016.

The Bank has strengthened its pan India network by opening 57 branches during the year 2015-16. The domestic branches include 6 Flagship Corporate Branches, 15 Mid Corporate Branches, 7 Asset Management branches, 23 Service Branches and 1 Integrated Treasury Branch. 29 Retail Loan Hubs, 2 SME Hubs and 72 City Back Offices are also functioning across the country attached to the major city branches. 4317 Business Correspondents are functioning in 17102 villages to provide banking services at the door steps of people who are so far away from the banking fold,

2. Alternative Delivery Channels:

2.1. Bank has joined National Financial Switch (NFS) which enables customers to access more number of ATMs across the country. As on 31.3.2016, Bankhad 2564 ATMs out of which 2010 are onsite and 554 are offsite. Bank had issued 8566186 of Debit/ATM cards as on 31.3.2016 as compared to 6112218 cards as on 31.03.2015 thereby achieving an increase of 40.15% over the previous year. The bank is issuing Rupaycards under financial inclusion and ATM enabled Kisan Cards linked to Kisan account.

2.2. Internet banking facility is available to customers for utility bills payment, for air and rail ticket booking, on line shopping, inter-bank and intra bank fund transfer etc. Bank is also providing services like balance enquiry, account statement, transaction related SMS alerts , payment of indirect taxes, Direct taxes and many other banking services. The total e-banking users as on 31.03.2016 are 530566, as against 384524, as on 31.03.2015, registering

a Y-O-Y increase of 37.98%.

2.3. Bank has introduced Mobile Banking services during the year 2011-12, whereby customers can take advantage of conducting their banking transactions through mobile phones. Through the mobile banking facility, customers are now performing banking activities like balance enquiry, account statement, mobile recharge, intra & inter-bank funds transfer with their mobile handset using SMS/GPRS modes of connection. M-banking users as on 31.03.2016 are 272969 as against 70534 as on 31.03.2015 recording an increase of 287% Y-o-Y.

During FY 2015-16; 35.45% of the total transactions have taken place through alternate delivery channels as against 29.27% in FY 2014-15.

3. Business Profile:

3.1. GLOBAL:

Total deposits of the bank stood at Rs. 207118 crore as on March 2016 compared to Rs. 214337 cr a year ago and gross advances of bank as on March 2016 are at Rs.1,35 508 cr compared to Rs. 1,51,812 cr a year ago. Total Business of Bank stood at Rs. 342626 crore as of March 2016 as against Rs. 366149 cr as on 31.03.2015.

3.2. DOMESTIC.

On the domestic front, total deposit stood at Rs.190885 cr as on 31.03.2016 as against Rs. 1,93,552cr in the previous corresponding year . Domestic Advances of bank stood at Rs. 1,18,791cr as of March 2016 as compared to Rs. 1,37,031 cr in the previous year. Total Deposit of Bank has declined as of Mar'16 due to conscious decision of shedding of bulk deposits as a measure to reduce interest cost. Gross Advances of Bank has declined due to decline in LC Bill Discounting business of the bank and subdued growth in the Major industries.

3.3 CASA:

Current and Saving (CASA) deposits of the bank stood at Rs. 60466 cr as of March 2016. The bank's CASA deposit to domestic deposits constituted 31.68% . Saving deposit rose by 11.63% to Rs. 40438 cr as at March 2016.Current deposit stood at Rs. 20028 cr as of Mar'2016 as against Rs. 26149 cr in Mar'15.

3.4 Financial Performance:

The bank incurred a Net Loss of Rs. 2799 cr for the whole year ending 31.03.2016 compared to the net profit of Rs.1138 cr for the corresponding previous year. Operating Profit for the year ended Mar, 2016 is Rs. 3603 cr compared to Rs. 4910 cr for the last year. Total provisioning and contingencies of bank increased to Rs. 6403cr compared to Rs. 3772cr for the last year.

The bank's total income stood at Rs. 20157 cr as of March 2016 compared to Rs. 21, 363cr last year. While interest income from loans and advances stood at Rs.12293 cr; interest from investment stood at Rs. 5663 cr. Net Interest income was Rs. 4848 cr as of Mar'16 against Rs. 5562 cr as of Mar'15. The Non-Interest income earned is Rs. 1596 cr as on Mar'16 as compared to Rs. 2004 cr in the corresponding previous year.

The bank's interest expenses marginally declined to Rs.13713cr for March 2016 from Rs.13797 cr in March 2015.Bank's total expenses stood at Rs. 16554 cr as on Mar'16 against Rs. 16452 cr as of March, 2015. The Bank's cost of deposit declined to 6.11% and yield on advances increased to 10.17% as at March 2016 from 6.35% and 9.92% respectively in Mar'15. Cost to income ratio increased to 47.19% from 37.74%.

4. Capital :

Net worth of the Bank has decreased to Rs. 9720 crore during the financial year ending 2015-16 from Rs. 11585 crore of the corresponding previous year. In 2015-16 , Govt. of India infused Rs. 935 cr capital in the bank by way of preferential allotment of Equity Shares on 30.3.2016 which was maintained in the "Share Application Money Account". (On 10.05.2016, Bank allotted 22,54,64,190 equity shares to the Government of India on preferential basis at an issue price of Rs. 41.47 per share determined in accordance with SEBI ICDR Regulations, 2009 against the capital contribution of Rs. 935 crore.)

5. Capital Adequacy Ratio:

As per Basel III framework, the Bank's Capital Adequacy Ratio of 9.63 % as at 31.03.2016 was higher than the regulatory requirement of 9%. Details of Capital Adequacy under Basel-III framework are shown as under.

6. TREASURY & INTERNATIONAL

Bank has been performing its Treasury & Investment Operations by keeping track of the macroeconomic scenario and market developments in accordance with the regulatory guidelines issued by Reserve Bank of India from time to time as also the Bank's Corporate Investment Policy approved by the Board of Directors. In the changed scenario, where state of the art technology is providing cutting edge in Treasury & Risk Management, Bank has also embarked upon a globally deployable Integrated Treasury Management Solution for an effective and efficient way to optimize resource utilization and maximize returns on investment and trading.

In order to mitigate risk and proper balance sheet management, bank has gone for interest rate swap transactions. During the year 2015-16, Bank has experienced severe market volatility and despite all odds the bank could significantly improve the yield on its Investment portfolio.

The global investments (Gross) of the Bank during the year 2015- 16 grew by 30.84% from Rs.64594 crore as on 31.03.2015 to Rs.84512 crore as on 31.03.2016. The domestic investment grew by 31.26 % from Rs.62749 crore as on 31.03.2015 to Rs.82361 crore as on 31.03.2016. SLR investment registered a growth of 25.90% during the year 2015-16 touching the level of Rs.69706 crore compared to Rs.55368 crore in March 2015. Non SLR investment (domestic) grew by71.46% to reach Rs.12655 crore from Rs.7381 crore in 2015-16 due to increased investment in Govt UDAY Bond.

The yield on domestic investment decreased marginally from as on 31.03.2015 to 8.04% as on 31.03.2016. Total investment income for 2015-16 stood at Rs.6370 crore as against Rs.5947 crore in 2014-15.

6.1. Export Finance:

With 74 'B' Category Branches across India, UCO Bank is committed to actively cater to the needs of its Exporters. Total Merchant Turnover of the Bank during the Financial Year ended March, 2016 stood at Rs. 65,640 crore which is 41.00 % lower than previous year. Bank's Export credit outstanding during 31st March, 2016 is Rs. 2,347.29 crore, registering a decline of 13.29% over 31st March, 2015.

'UCO Bank,' is the sole Bank to facilitate bi-lateral trade with Iran by agreeing to receive payment in INR for Iranian oil exports to India. Simultaneously, to boost exports under this Rupee Payment mechanism, 'UCO BANK' negotiated 381export bills amounting to Rs.1,221 crore cumulative from April, 2015 to March, 2016. The Export Credit outstanding as of 31st March, 2016 on account of Iran Trade is Rs.146 crore.

7. SOCIAL BANKING

7.1. Priority Sector Advances:

The Bank has been showing significant performance in lending to Priority Sector over the years and has been effectively servicing the priority sector and agriculture sector with its vast network of rural and semi-urban branches.

As on 31.03.2016, the Priority Sector Advances of the Bank stood at Rs. 55948 crore constituting 38.70% of Adjusted Net Bank Credit (ANBC).

7.1.1. Agriculture Advances:

Total Agriculture Advances of the Bank stood at Rs. 19593 crore constituting 13.55% of ANBC. Direct Agriculture stood at Rs.12772 crore constituting 8.83% of ANBC.

7.1.2. Micro, Small & Medium Enterprises (MSME):

Bank recognizes the important role of MSME in the economic development of the Country which is also supporting in generating employment opportunities in the Country. The advances under Micro& Small Enterprises (MSE) as on 31.03.2016 stood at Rs. 22772 crore and under Micro, Small & Medium Enterprises (MSME), the advances are Rs. 25935 crore as of 31st March, 2016.

7.1.3.Advances to Weaker Sections:

Advances to Weaker Section stood at Rs. 17767.40 crore as of 31st March, 2016 constituting 12.29% of ANBC. The Y-o-Y growth of advances to Weaker Sections stood at 17.00%.

7.1.4. Minority Community Advances:

Total Minority Community Advances of the Bank as on 31.03.2016 stood at Rs.8416 crore constituting 15.04% of Priority Sector Advances.

7.2. Unique Schemes:

The Bank has two unique schemes - (1) "UCO Uthaan" for upliftment of BPL families of adopted villages & (2) "UCO SamagraGraminVikasYojna" - Adoption of villages for all-round development.

7.2.1. UCO Uthaan Scheme:

Social-cum-Financial upliftment scheme for BPL families Under the Scheme, villages having large number of BPL families are adopted by the Bank through its nearest branch to bring the BPL families out of the clutches of poverty and to bring about a holistic change in the villages. Under the scheme, a holistic development plan of the villages is drawn and followed up for covering areas like education, financing for rural housing, formation of SHG and micro-financing, development of handicrafts & rural artisans and extending finance under DRI Scheme.

The Bank has adopted 21 villages in 10 states i.e. Assam, Bihar, Gujarat, Maharashtra, Odisha, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh & West Bengal under UCO Uthaan Scheme. Bank has conducted several financial literacy camps in these villages and has provided financial assistance particularly to BPL families to improve their livelihood, to generate more income so that they come above poverty line.

By these efforts, 2141 BPL families, in these 21 adopted villages, have been provided with credit assistance by Bank to uplift their livelihood in better way during last 3 years. These BPL families are generating their income by adopting several activities like dairy farming, goat farming, betel leaf cultivation, vegetable growing, cycle repairing, shoe mending, fruit vending, grocery shop, tea stall, beedi making, trolley plying, mason jobs etc.

7.2.2. UCO Samagragramin Vikas Yojna :

For all-round development of villages The Bank has adopted 10 villages in 6 states i.e. Gujarat, Himachal Pradesh, Odisha, Kerala, Uttar Pradesh & West Bengal for its all-round development under UCO Samagragramin Vikas Yojna.

In these villages, Bank has conducted financial literacy camps to educate the villagers, extended financial support to them and has also initiated developmental activities under Corporate Social Responsibility. Under financial assistance, Bank has given General Credit Cards (GCC) to small traders, Artisan Credit Cards (ACC) to artisans, Kisan Credit Cards (KCC) to farmers, loans to SHGs, loan for doing animal husbandry activities, loans to women & SC/ST beneficiaries. Many small traders have started their own business with the support of Bank loan. Through CSR activities, Bank has given Ceiling Fans, Water purifiers to different schools, Steel Almirahs, Books for school library, School uniform for school going children, installation of hand pumps for drinking water in the villages, installation of Solar street lights in the villages, construction of metallic road.

In two villages, out of above 10 villages, Bank has provided doorstep banking facilities to the villagers of these unbanked villages through Mobile Van. The Van visits these two villages on a predetermined day and time during the week and provides all types of banking facilities to the villagers at their doorstep. There has been increase in the saving habits of the villagers due to this initiative. Through these vans, villagers are also being financially educated. By these activities, there is an all-round development in the adopted villages and the villagers are very much benefitted.

7.3. Awards to Bank:

UCO Bank was awarded by CIMSME "MSME EXCELLENCE AWARDS - 2015" under the below mentioned categories during Jan'16:

l Best Bank for PM Jan DhanYojna under Mid Sized Bank- Winner

l Best Bank for Promotional Scheme under Mid Sized Bank- Winner

l Best Bank for Financial Inclusion under Mid Sized Bank - Runner Up

UCO Bank was awarded 3rd Prize in the All India Competition under Medium Bank category in recognition of its remarkable Contribution to RSETI movement in the country on the auspicious occasion of RSETI Diwas on 15.07.2015 organized by Ministry of Rural Development, Government of India.

8. FINANCIAL INCLUSION:

India is a country of more than 6 lakh villages wherein providing banking facility has been a challenge. Govt. of India's mission mode project "PM Jan DhanYojna",launched on 28th Aug, 2014, aims to bring excluded masses under the umbrella of structured banking system, to inculcate the habit of saving among the people who are so far excluded from the economic mainstream and thereby to eliminate the dishonest practices of money lenders by catering to credit needs of people below poverty line. Rising to the occasion, Bank has opened more than 72.25 lakh accounts so far under PMJDY and mobilized Rs. 1680 Cr in these accounts. Percentage of Zero balance accounts is 24.50%, well below the industry average.

8.1 Launching of Micro ATM - UCO SARATHI

Bank has launched RuPay Card transaction enabled Tab based Micro ATM called UCO SARATHI on 2nd November 2015, which can be used by BC Agents (Bank Mitr) for offering a wide range of Banking Services. These BCs are equipped with plethora of banking services including Online opening of RD & FD to Bank's customers, Aadhaar enabled services, eKYC; RuPay Card PIN based transactions; real time Remittance through IMPS system for both existing customers and other citizens , mobile recharge and other bill payments; Micro Insurance products like PMJJBY & PMSBY and social security schemes like APY(Atal Pension Yojna).

8.2. Implementation of Jan Suraksha Schemes

Working on the government's theme of providing social security to hitherto unbanked masses, Bank has successfully implemented Insurance and Pension products namely, Pradhan Mantri Jeevan Jyoti BimaYojna (PMJJBY), Pradhan Mantri Suraksha BimaYojna (PMSBY), Atal Pension Yojna (APY) through its Branch and BC network.

Gradually, efforts under Financial Inclusion are showing results and Bank has started gaining both tangible and intangible benefit out of these activities. While decongestion of branches, reduction of transaction cost and increase in CASA base are intangible benefits of FI Project; tangible benefits have come in the form of commission earned under various products.

Under PMJBY scheme, there are 478051 enrolments, resulting in earning commission of Rs. 171.04lac to the bank. Under PMSBY scheme, there are 1059506 enrolments, resulting in earning a commission of Rs.19.40 lac to the bank. During the year a total of 258 claims were settled under PMJBY and 67 under PMSBY.

Total subscribers under Atal Pension Yojna during the year is 31,172.Through APY and DBTL bank has earned a commission of Rs. 16.67 lac and Rs. 63.76 lac respectively.

9. RETAIL BANKING:

9.1. SCHEMATIC RETAIL LENDING

Bank had launched new facility for Home Loan Borrowers namely UCO Pre-approved Home Loan scheme, a facility for providing in-principle sanction of Home loan limit based on entitlement as per income where property has not been identified/finalized by the applicants. Several other asset products were modified in line with market requirements.

Bank has introduced scoring model in retail lending schemes to standardize sanction process of retail loans. Bank has registered a growth of 17.89% under Home Loan during FY 2015-16.

UCO HOME Loan Campaigns launched during the year were very effective, thereby sanctioning a total of Rs.1590 crores to 9849 applicants.The bank has also registered substantial growth of 43.25% in UCO Property loan.

LAPS processing has been made mandatory for sanctioning loan under six retail loan schemes. The bank has tied up with Vidhya Lakshmi portal, an initiative for uniform education loan application and the same has been integrated with LAPS.

9.2. Other initiatives

UCO Rewards, a loyalty initiative has been implemented during the financial year. The bank has tied up with 10 payment gateways of which integration with 4 gateways is in process . The bank has tied up with www.cleartrip.com& www.goibibo.com to provide offers/discounts on travel/hotel bookings for customers. The bank has signed up with BizSciences for affiliate merchant partner program. The bank has tied up with Pay-U Money for encouraging customers to use its online payment instruments through discount offers on leading websites. The bank has tied up with freecharge. in to provide special cashback offers to our valued customers. The bank has launched UCO Retail, a monthly newsletter focusing on contemporary and future retail strategies. The bank has tied up with Tech Mahindra, offering "Tap & Go", a cashless financial transactions service through debit card & POS machines.

9.3. Bancassurance:

At present bank is Corporate Agent for Life Insurance Corporation of India (LICI) for life insurance business. It is also an agent for Reliance General Insurance Company Ltd for non-life insurance business .Bank has duly complied with the new regulatory guidelines of IRDAI and the bank's corporate agency license has been renewed for three more years till March, 2019. Bank has substantially increased the strength of Specified Persons (SP), duly trained and certified by IRDAI for canvassing banc assurance business.

By integrating the business process with our non-life banc assurance partner, bank has successfully made the trial run for online generation of insurance policies for our customers enabling them to get non-life insurance policies from branches, immediately on payment of premium and this will be made live shortly.

In order to increase the banc assurance growth among our customers and commission earning for the bank, bank is planning to have tie ups with more insurance companies for life/non-life insurance business.

10. RECOVERY:

The increasing trend of NPAs in the Banking Industry over last two years has become a concern for the bank. Gross NPA level of our bank has inflated from 6.76% in March 2015 to 15.43% in March 2016 and the quantum of GNPAs has increased from Rs. 10265.05 crore to Rs. 20907.73 crore respectively on account of AQR review by RBI. The NNPA percentage rose to 9.09% from 4.30% of previous year.

During the FY 2015-16 the bank has witnessed fresh slippages of Rs. 14942.35 crore. The overall cash recovery and up gradation in NPA accounts during the year is Rs.2727 crore against Rs.2506 crore in FY 2014-15. Considering the surge in the GNPA and NNPA levels, maintaining Bank's asset quality and recovery of bad debts are the prime concern for the bank.

10.1. Recovery Performance:

Bank's recovery mechanism has also been geared up at all levels of the organization to take advantage of Modified Compromise Settlement Scheme, SARFAESI Act, DRTs and LokAdalats. Country-wide mega recovery camps, MAO campaigns, Mega E-auction of financed vehicles etc. were organized for speedy recovery. All other strategies and action of setting up call centers at Zonal Offices have also strengthened the follow up mechanism in stressed accounts.

The total cash recovery plus up gradation for the year ended 31st March, 2016 is Rs. 2727 crores as against Rs. 2506 crores for the year ended 31st March, 2015. The recovery in written off accounts is Rs.131 crores for the year ending March, 2016 compared to Rs.189 crore for the previous year.

Recovery in loss assets has a direct bearing on the profitability and the bank is giving priority in monitoring / follow-up for recovery in such accounts. A separate vertical in the bank is monitoring consistently for recovery in loss assets including technically written off accounts. However, recovery in loss assets is low during FY 2015-16.

10.2. Some Recovery initiatives:

ABC Analysis of NPA Portfolio is done to minimize NPAs. Efforts were also made to recover & upgrade NPAs, particularly focusing on freshly generated NPAs wherein immediate scope of recovery is better. Recovery camps were conducted to improve bank's recovery performance. Modified Compromise Scheme for loans with balance outstanding up to Rs.10.00 lacs and a special compromise scheme for loans up to Rs. 2 lac have been approved with borrower friendly features. Mega e-auction of properties pertaining to West Bengal and a pan-India e-auction were conducted on 29/1/16 and 23/2/16 respectively. High value NPA accounts were assigned to top executives, for close monitoring of recovery process. Zonal level dedicated recovery teams are visiting high NPA branches and conducting Recovery camps so as to facilitate borrowers/guarantors for early settlement.

11. CREDIT MONITORING

"Continued volatility and uncertainty in the economic situation has accentuated upsurge of bad loans in the banking industry. However bank has geared up in tackling the situation by initiating measures as under.

1) Bank has put in place framework for identification of Red Flagged Accounts (RFA) based on the 45 triggers known as Early Warning Signals as per the RBI guidelines on "Framework for dealing with loan frauds" leading to the identification of the account as fraud or not within the period of six months from date of marking the account as RFA.

2) For better management of irregular & Non Performing (NPA)

borrowal accounts, revision in Delegated Authority for allowing "Holding on Operation" has been effected.

3) Two workshops have been conducted in July 2015 and January 2016 in order to sensitise the field level functionaries on the importance of monitoring of borrowal accounts on regular basis effectively.

Apart from the above, some of the other initiatives taken by the bank to improve the functioning at the grass root level include:

1) Revision and updation of Credit Monitoring Policy has been put in place w.e.f 01.12.2015 after obtaining approval of the board.

2) Change in accounting procedure has been brought about in respect of devolved LC and invoked BG w.e.f 24.08.2015.

3) Efforts have been made to bring about the awareness among the field functionaries with regard to opening of current account by making use of iScan utility provided by CIBIL for ensuring the compliance of RBI guidelines issued in this regard.

4) Meeting of the Corporate Borrowers under stress are being arranged with Top Management.

12. RISK MANAGEMENT

Risk management initiatives of the bank, during the year 2015- 16 include, customization of in-house developed score card models for Retail, MSE and Agriculture loans up to Rs.1.00 crore, as well as rating models for large advances and these models can be accessed online by branches, while processing credit proposals. Further ,in the process of implementing advanced approaches to operational risk, majority of the branches were brought under RCSA (Risk and Control Self-Assessment). KRIs (Key Risk Indicators) to be used for risk monitoring were identified.

Workshops were conducted at all circles, to train risk officers and select branch heads on RCSA, Score cards and Capital optimization strategies. Systems for data exchange with CORDEx, including uploading of loss data to the CORDEx platform, were put in place. Bank has worked out benchmark reference rate based on Marginal Cost of Fund based Lending Rate (MCLR) for pricing of loans and advances effective from 1st Apr, 2016.

13. REGIONAL RURAL BANKS (RRBs)

UCO bank has sponsored two RRBs namely, Bihar Gramin Bank (BGB), head quartered at Begusarai, Bihar and Paschim Banga Gramin Bank (PBGB) head quartered at Howrah, West Bengal with four regional offices each. The RRBs have a total of 594 branches as on 31.03.2016.

13.1. Capital position of RRBs

The total capital composition of Paschim Banga Gramin Bank as on 31.03.2015 stood at Rs. 154.51 Cr (Govt. of India), Rs.108.16 Cr (UCO) & Rs. 46.35 Cr (West Bengal State Govt.). Similarly, for Bihar Gramin Bank, it stood at Rs.109.08 Cr (Govt. of India), Rs.76.35 Cr (UCO) & Rs. 32.72 Cr (Bihar State Govt.)

13.2. Performance of RRBs ( As per Unaudited results for 31.03.2016)

In respect of performance under key business parameters, total deposit of RRBs sponsored by the Bank stood at Rs. 7766.79 crore as on 31.03.2016, registering growth of 14.26 percent. Total advance reached a level of Rs. 4782.32 crore with an annual growth of 16.62 percent as of 31.03.16. CD ratio of RRBs improved from 60.33 to 61.57 as on 31.03.16.

The gross NPA of the RRBs stood at Rs. 330.36 crore as on 31.03.16 vis-à-vis Rs. 170.57 crore as on 31.03.2015. Gross NPA to Gross Advance increased from 4.16 percent as on 31.03.2015 to 6.91 percent as on 31.03.2016. The net NPA ratio of the RRBs has also increased from 3.30 % as on 31.03.2015 to 5.70% as on 31.03.2016.

Bihar Gramin Bank has recorded a net profit of Rs. 34.17 crore as on 31.03.2016 as compared to Rs. 75.52 crore as on 31.03.15 and Paschim Banga Gramin Bank has also reported a net profit of Rs. 7.85 crore as on 31.03.16, thereby reducing accumulated loss from Rs. 89.33 crore as on 31.03.2015 to Rs. 81.48 crore as on 31.03.2016.

14. INFORMATION TECHNOLOGY

14.1. In-House Software Development:

Various modules such as, Salary module, Leave module, Annual Property Return (APR) have been developed and integrated with the HRMS package. The package includes employee self-service modules and HR function enabling modules. Similarly, Form-16 (details of salary & TDS) of bank employees and STF-17 (confidential report for new recruits), Monthly Progress Report (MPR) were made online. PF statement has been made available in HRMS. Repatriation and Online Promotion Application has also been integrated with HRMS. A module for submission of the details for all Retired Employees and their Spouses has been developed and integrated with the HRMS.

14.2. e-TDS Integration with TRACES.

Bank has successfully integrated ETDS application (Saral TDS) with TRACES website for one branch on pilot basis.

14.3. Foreign Account Tax Compliance Act (FATCA).

As per the regulatory requirements, FATCA details have been implemented successfully in FINACLE for retail and corporate customers. Further, a reporting software for FATCA/ CRS is being developed.

14.4. Knowledge Management Tool (KMT).

Bank has implemented Knowledge Management Tool (KMT), which is a comprehensive repository of all Regulatory and statutory information (circular /rules /regulations /policies /reviews etc.). KMT is available on ucoonline.in (internet platform) for MD & CEO, EDs', GMs', DGMs'.

14.5. Access of CBS application in branches through Internet Data Card.

Department has allowed access of CBS application in branches through Internet Data Card to provide connectivity to branches during network dislocation. The access of CBS through internet link is closely monitored during the access and necessary authenticating steps have been put in place for the same

14.6. Net Assist software to monitor Network downtime issues.

Online module to monitor the downtime network issues for each and every branch, ZO, CO, HO etc. has been developed by the bank. Each network down ticket is registered and NOC team resolves the issue by following with the concerned service provider and ensures restoration of the network link

14.7. CTS Implementation

A total of 37 centres were brought under CTS under the three grids (Northern grid - 4 centres, Southern grid - 23 centres & Western grid - 10 centres).

14.8. Online module for Pradhan Mantri Suraksha and Bima yojana.

This module facilitates customers of the Bank for premium payment for Pradhan mantri Suraksha BimaYojana and Pradhan Mantri Jeevan Jyoti BimaYojana.

14.9. Employee Awareness Test(EAT):

An on-line examination portal to test and upgrade employees' knowledge base on various Bank products, latest initiatives etc has been jointly developed by DIT and Strategic Planning Department Teams. Each test consists of ten random questions and on submission ; the result is displayed along with the percentage scored and answers to incorrect attempts.

14.10. Auto Generation of Interest Certificate:

As propsed by HO-Strategic Planning Department, a facility has been developed by HO-DIT to provide Interest Certificate for Home Loan and Education Loan borrowers through bank's website.

14.11. SWIFT Messaging Alert System:

Bank has started the facility of sending SMS alerts of all incoming SWIFT messages to the mobile numbers of the respective Branch Heads and also to the email ids of the respective ‘B’ & ‘C’ category branches.

14.12. Automations and process improvements:

Using our new module, monthly current account statements can be emailed to customers automatically. In order to avoid incorrect preferential rates on deposits, auto-population of preferential interest rate, based on date of birth of senior citizens has been implemented. As per the directions of RBI/NPCI all the ECS debit mandates were migrated to NACH platform with effect from 05/ 02/2016 and are now centrally processed by CBO, Mumbai. Printing of random bar code number on passbook in place of customer's account number to restrict misuse of account number implemented.

15. New initiatives of BPR & BTD

15.1. Card Banking:

Customer can transfer funds from one account to another account either in the same Bank or with another Bank by using their Debit/ ATM card at the ATMs of those NFS members who are enabled for this service. Customer can hot-list his card instantly using our newly developed SMS based hot-listing service.

15.2. E-Banking:

Using the new menu developed for standing instructions, customer can manage his standing instructions through e-banking. An extra layer of security has been added using OTP if the customer logs in from an IP address different from the previous login. Voice OTP facility, has been implemented, which auto-initiates when OTP could not be delivered within 60 seconds.

As RBI has mandated all the banks to implement PKI (Public Key Infrastructure)solution for two factor authentication of internet banking transactions, the bank has implemented the same whereby the customers can authenticate their internet banking transactions using their digital signature.

15.3. New Mobile Banking & Digital Passbook:

A new m-banking application has been launched with extended facilities in the month of Aug'2015 through which customers are now performing seamless banking activities. Digital Passbook application (mpassbook) was also developed for enabling customers to view all their accounts & manage finances effectively. These are available in 10 different regional languages.

15.4. UCO Tap & Go:

It is a co-branded prepaid wallet solution presently live exclusively at Mount Carmel College, Bangalore, based on contactless CHIP technology, by which students can pay library fees, mess bill etc.

15.5. Other Initiatives:

PFMS (Public Financial Management System) has been launched through which Direct Benefit Transfer and acknowledgement process has been automatized. In order to enhance the facility of foreign inward transactions in UCO Bank accounts, UCO Bank has gone on board with NPCI extending the facility which allows the receipt of money from abroad in NRI accounts through IMPS.

16. OPERATION & SERVICES

KYC compliance improved to 99.29% as of Mar'16 from 98.60% at the close of FY 2014-15. Multiple customer Ids have been drastically reduced to a mere 0.28% of total operative customer Ids.

"Centralized AML Cell" has been established to ensure effective scrutiny of STRs and all STRs up to Feb'16 have been scrutinized and removed. Call Centre agent strength has been increased by 63% to ensure all customer calls are attended 24x7. Standardized Public Grievance Redress System (SPGRS) has been streamlined, resulting in quick disposal of complaints. As against 7447complaints received (other than ATM related), only 79 are pending as of 31.3.2016.

The number of branches authorized to open government accounts (PPF, SukanyaSamridhi etc.) has been increased manifold from 173 in Mar'15 to 3010 in Mar'16. The Turnover Commission (TOC) from Government Business increased from Rs. 15.65 cr in 2014-15 to Rs. 20.65 cr in 2015-16 up by 32%. "Centralized Authentication Cell" has been constituted at all Zonal Offices to ensure proper customer identification procedure for opening current accounts.

17. CORPORATE COMMUNICATIONS

Bank is doing publicity of its products and services, through print, outdoor and digital media, as well as participating in outdoor activities and sponsorships. The stake-holders and public at large are provided information about Bank through press meets, press releases, and one to one communication. Publicity Campaigns for various assets & liability products, information on various technology initiatives taken by the Bank to enhance banking experience has been the essence of countrywide publicity during 2015-16.

The other means of brand recognition deployed during the current financial year are publicity campaigns by way of participating in loan fairs, through wall paintings in rural area, banner advertisement on website, Bank's caller tune, on line advertisement, organizing Loan melas, besides organizing a road show to mark the celebration of 73rd foundation day. Bank has also participated in the corporate social responsibility activities making donations to the tune of Rs. 4.23 crore under CSR. Bank has been regularly publishing the in-house magazine "UCO TOWER" to make aware the employees about the various activities of the bank.

Bank's Official Website: - Bank has been maintaining bank's website since 1998. As the bank's website is a window of information to the world, the website is constantly monitored and updated. Bank is in the process of revamping the whole website to make it more interactive and responsive.

18. HUMAN RESOURCES

Human Resource Management Department comprises of various Cells looking after different segments of the department. All these cells worked in tandem during FY 2015-16 to create a harmonious and productive work environment. Training and workshops were organized for improving/enhancing skills and knowledge of staff.

18.1. Manpower

The total Staff strength as on 31st March, 2016 stood at 24724, including employees serving overseas. The total staff strength comprises of 12084 Officers, 8254 Clerks, 4386 Subordinate staff. The percentage of Scheduled Castes (5159) and Scheduled Tribes (1867) taken together in the total domestic staff strength is 28.42%. Besides, there are 3190 OBC employees in the service of Bank at the end of March, 2016. The strengh of employees also comprises of 1449 employees belonging to Minority Communities, Women employees (5271) constitutes 21.32% of total work force as of March, 2016.

18.2. IR Negotiation Cell

During the period, the Industrial Relations climate in the Bank remained cordial between the Management and the Unions/ Associations. Meetings and discussions were held with Unions/ Associations at periodic intervals through mutual co-operative attitude and respect during the financial year 2015-16.

18.3. Reservation Cell of Head office, HRM Department

Bank has been implementing reservation policy guidelines with regard to Scheduled Castes, Scheduled Tribes, Persons with Disabilities and Ex-servicemen employees. Reservation and concessions available to such employees are strictly adhered to as per the provisions. In the FY ending 31.03.2016 five Pre- Promotion Training Programs were conducted by the Bank in which 1499 employees from different cadres (SC-625, ST-276 & OBC-598) took part. Complaints received from such category of employees were immediately addressed. Further, regular Quarterly Meetings with welfare association of such category of employees were conducted at Apex level as well as Zonal Office level (where Reservation Rosters are maintained). The grievance of such category of employees is heard in such meetings and subsequently addressed as per Bank's policy guidelines. National Commission for Scheduled Castes convened review meetings on implementation of Reservation Policy and other safeguards available to such category at Apex level as well as at Zonal Offices. At apex level such meeting was held by the Commission on 04.11.2015. Similar meetings at Zonal level were convened by the Commission at Ernakulam on 17.12.2015, at Ahmadabad on 29.01.2016, at Jaipur on 18.02.2016 and at Ajmer on 19.02.2016. Their observations were noted and Action TakenReport was submitted to the Commission in time.

18.4. Recruitment Cell

Bank has recruited 304 Officers during the year 2015-16. These 304 Officers comprise of 41 SC's, 22 ST's, 93 OBC's and 96 women. Bank has reviewed and extended the service of Chief Customer Service Officer (Internal Ombudsman) for further one year on contractual basis. 801 clerks have also been recruited during the year 2015-16, of which 176 are SC's, 80 are ST's, 202 are OBC's, 226 are females and 62 belong to minority community and 19 are Persons with Disabilities. Bank is in during the year 2015-16, of which 176 are SC's, 80 are ST's, 202 are OBC's, 226 are females and 62 belong to minority community and 19 are Persons with Disabilities. Bank has also initiated the process of recruitment of 525 Probationary Officers &1500 clerks and 30

IT Officers for the Financial Year 2016-17.

In order to focus on rural lending, bank has finalized the recruitment of 225 Agricultre Field officers to be posted across the country at potential rural branches of the bank.

18.5. TRAINING Cell

Our organization, being a part of one of the most dynamic industries, has to keep up with the constantly changing environment by continuously updating its workforce with various Training programmes in the concerned field. Bank has reviewed Training Policy with value additions. During Financial Year 2015- 16, emphasis was given for imparting Training to all sections of employees and organizing Locational and Camp Based Training Programs which are organized at Zonal Office level. 5225 Officers, 3805 clerks and 69 sub-staffs were trained using Location program at ZO Level across the country. 6211 Officers, 3749 Clerks and 229 Sub-staff were Trained under in-house training programs in CSC, Kolkata and Seven (7) RTCs of the Bank.

Apart from general topics viz Credit Appraisal, NPA Management, Priority Sector Lending, LAPS, Unicode, CBS, Security Aspects, Managerial Skills, Operation in Finacle, Leadership Development etc, special topics viz Soft skills, Documentation, ADC, KYC, HR Issues etc. have been introduced in Training System. Specially designed Soft Skill Training has been introduced for Officers up to Scale III and Award Staffs at CSC/RTCs.

Bank has nominated 378 Officers/Executives to outside Training Institutes like NIBM PUNE, CAB PUNE, IIBM Guwahati, BIRD Lucknow, IIBF Mumbai, IDRBT Hyderabad and many other Institutes for External Training. Specially designed Training Programmes on Soft Skills, Forex, Credit Management, Risk Management, Agri-financing etc. were conducted with External Training Institutes viz. NITTE, Manipal Global, ICON, NIBM etc. where Officers were trained to create a competency pool in various areas. Overseas Training was also given to one of our Top Executives. A system has also been designed for better capacity utilization of Training colleges. Bank has given utmost importance for nomination of right persons in Training. Of late, Bank has completed selection process of 6 new Faculty Members for Training Colleges.

18.6. Manpower Placement & Promotions Cell

During the year 2015-16, Bank has promoted 6 Executives to the post of General Manager (Top Executive Grade Scale-VII), 19 Executives promoted from Scale-V to the post of Deputy General Manager (Top Executive Grade Scale-VI) and 77 Executives from Scale-IV to Scale-V.

In addition, 195 officers in Scale-III have been promoted to Scale- IV, 282 officers in Scale-II to Scale-III and 1212 officers in Scale- I to Scale-II.

During the year, through promotion process, 392 clerks have been promoted to the post of Officer (JMGS-I).

18.7. He artfulness Meditation Programme for Staff

Under the aegis of Shriramchandra Mission Team, 17 heartfulness meditation programmes covering 770 staff were organised. In each training programme at Central Staff College, Kolkata, the meditation programme is conducted in the morning time for one hour for three days, The participants have very much appreciated these programmes.

19. AUDIT & INSPECTION

Bank has re-introduced quarterly concurrent audit system for a wider coverage of High Risk branches under the purview of Audit & Inspection. To bring more transparency and objectivity in the selection process of concurrent auditors, a scoring system has been introduced and selections are made purely on merit basis. Management Audit format of Zonal Office has been revised to focus more on capturing policy deviations, credit administration & expenditure control measures.

A new Audit Compliance & Closure Policy has been formulated to ensure more effective timely compliance and closure of various Audit & Inspection Reports. One day work shop has been arranged for the Heads of Field Inspectorates to sensitize them on their role in the changed scenario of increasing stressed assets. Training Program has been conducted for field inspectors to make them more familiar with newly implemented "e-THIC" package of Risk Based Supervision.

20. VIGILANCE DEPARTMENT

Bank has organized Awareness Programme on Preventive Vigilance at Chandigarh, New Delhi, Guwahati and Bhubaneswar. During the year, CVO visited 74 Branches and 23 administrative offices to create vigilance awareness among staff. Field Vigilance Officers visited more than 385 Branches to verify the vigilance compliance by branches. Several "Preventive Vigilance" training programs have been conducted to improve skills of preventive vigilance.

A compendium "Petals of Vigilance- A UCO Bank initiative against corruption" has been launched to increase awareness towards proper Corporate Governance.

Two days Workshop for Enquiry Officers/Presenting Officers on investigation procedure has been organized covering 16 Zones.

Vigilance Awareness Programs were organized at different centers, including Debate Competitions at DAV Model School, Durgapur and International Management Institute, Kolkata. Awareness Programme was also conducted at Kotalipara Development Society, an NGO, Barasat, West Bengal to inculcate the vigilance awareness for the upcoming generation

21. COMPLIANCE OF OFFICIAL LANGUAGE POLICY:

To implement the provisions of Official Languages Act,1963 and Official language policy of Government of India, Bank has given preferred attention towards use of Hindi in official work. 56 workshops were organised involving 1120 officers/employees for training them on official language usage which includes a session to get the trainees acquainted in using UNICODE or 'Lingua.Bank'.

During the review period, editions of Quarterly Hindi Magazine "Anugoonj" were published and 6 Hindi E-magazines were published by different Circle/Zonal Offices. Bank has organised several competitions with various Town Official Languages Committees (TOLIC) and also assisted other banks in organising Hindi workshops. Several seminars were organized by zonal offices on the subject titled as "Aapsi Samvad - Sarthak Disha" as per directions of Department of Financial Services, Finance Ministry, Govt. of India. A famous drama named "Jamunka Ped" was staged by H.O. youth group.

Various forms / publicity materials / procedural booklets and report of Annual General meeting of Shareholders, Manual of Instructions, Minutes of various Board Committees were prepared in bilingual form. Hindi text of the materials for our Bank's Website was also prepared.

As convenor (Bank) of TOLIC, Kolkata, bank has organized two half-yearly review meetings and several other events. Bank has also received during the current year from Rajbhasha Vibhag, Min. of Home Affairs, GOI, RIO (E.R.) award for being the second best convener of TOLIC for the year 2014-15 and has won several other prizes in various competitions.

22. COMPLIANCE DEPARTMENT

Bank has emphasized on compliance issues mandated by RBI. Bank has been ensuring the level of customer service, functions and compliance of rules of deposits, advances, KYC/AML, other services, submission of statutory/regulatory reports, information and data asked by RBI, GOI, SEBI & IBA, etc. through a strict compliance system. Compliance policy was prepared incorporating necessary changes to prevent breaches in compliance and the same has been circulated throughout the bank after board approval. Test checking of compliance functions was undertaken in 847 branches and 6 corporate offices.

Deficiencies observed are being rectified on the spot. Branches/ offices have been sensitized about compliance functions so as to avoid breaches. Critical issues were reported and discussed at appropriate level to enhance system efficacy. Interactions are also being held with Inspection & Risk management departments periodically to discuss compliance issues to arrive at measures to avoid recurrence thereof.

23. LEGAL MATTERS

Policies on "Schedule of Advocates' Fee" and "Empanelment of Advocates" have been reviewed in line with industry standards Bank has issued 25 circulars on various legal aspects such as Disciplinary proceedings, Roles & responsibilities of an authorized officer under SARFAESI Act, 2002, The sick industrial companies (Special Provisions) Act, 1985 etc., to make field level functionaries conversant with the latest developments in those areas. The claim lodged against the Bank before various fora of law are being defended by the Bank meticulously. Further, in order to augment Bank's recovery, cases filed before various DRTs against defaulting borrowers/guarantors are closely followed up by the Bank. The review of performance of Bank's Advocates is also done for expeditious disposal of cases handled by them.

24. FUTURE PLAN:

FY 2015-16 had been a litmus journey for the entire banking industry. Our bank left no stone unturned in effort to stay strong through the turbulence. Bank has invested the year in upgrading its resources with strategic focus. Bank will continue its emphasis on retail business, mobilization of CASA, and NPA recovery. Bank will maintain its momentum in priority sector advances. Financial Inclusion would also be another preferred area to bring in the people who are so far away from the banking fold.

The year 2016-17 will be termed the year of "Strategic Resource Alignment". The bank will fine-tune its resources to meet its visionary ambition of becoming the most preferred financial services brand and to generate business models for generating profit. Towards accomplishing the same, UCO will focus on the following key assets:

a) Its Human resources: Upgrading their competencies to suit bank's vision.

b) Its Technological resources: Promoting channel and product innovativeness.

c) Its Knowledge resources: Capturing and sharing organizational learning.

Bank invites its stakeholders to contribute in the process of getting in line with the broader organizational objectives.

25. BOARD OF DIRECTORS

25.1. Corporate Governance

Bank firmly believes in and has consistently practised good corporate governance woven around its core values of transparency, professionalism and accountability. By constantly focusing on these aspects in its day-to-day operations, the Bank strives to enhance shareholders' value. The Bank being committed to the principles of good governance, its Board of Directors has formed various committees of the Board to monitor every aspect of Bank's business. The systems and business processes of the Bank are continuously reviewed at various levels for identifying and strengthening areas of weaknesses, if any.

The Directors of the Bank believe that good governance is the key to earn trust, loyalty and goodwill of clients, business associates, employees and investors and also to have respectable position in the society at large.

25.2. Changes in the Board of Directors

l Shri Arun Kaul served as Chairman and Managing Director in the Board from 01.09.2010 to 31.08.2015.

l Shri J. K. Garg served as Executive Director in the Board from 05.08.2013 to 31.01.2016.

l Shri Pravin Rawal served as Government Nominee Director in the Board from 02.12.2011 to 14.06.2015.

l Shri V. L. V. S. S. Subba Rao served as Government Nominee Director in the Board from 15.06.2015 to 29.12.2015.

l Shri D. N. Thakur served as Officers Employee Director in the Board from 13.12.2012 to 12.12.2015.

l Shri Partha Chanda served as Workmen Employee Director in the Board from 15.02.2013 to 14.02.2016.

l Shri R. K. Takkar has been appointed as Managing Director and Chief Executive Officer with effect from 02.11.2015.

l Shri G. Subramania Iyer has been appointed as Executive Director with effect from 01.02.2016.

l Ms. Sindhu Pillai has been appointed as Government Nominee Director in the Board w.e.f.30.12.2015.

25.3. Meetings of the Board of Directors

During the financial year 2015-16, Bank had 10 meetings of the Board of Directors. The number of meetings of various other committees of the Board held during the year 2015-16 is given below:

25.4. Statement of Directors' Responsibilities

The Board of Directors confirm that in the preparation of the annual accounts for the year ended March 31, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any. The accounting policies framed in accordance with the guidelines of Reserve Bank of India, were consistently applied. Reasonable and prudent judgements and estimates were made so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit of the Bank for the year ended March 31, 2016. Proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of applicable laws governing banks in India; and the accounts have been prepared on an on-going basis.

International financial controls have been laid down by the bank for ensuring orderly conduct of business.

25.5. Acknowledgements

The Board of Directors places on record its deep appreciation of the contributions made to the deliberations of the Board by outgoing Directors namely, Shri Arun Kaul, Shri J. K. Garg, Shri Pravin Rawal, Shri V. L.V. S. S. Subba Rao, Shri D. N. Thakur and Shri Partha Chanda. The Board would like to welcome the new Directors and looks forward to their valuable inputs towards growth of the Bank. The Directors remain thankful to the Government of India, Reserve Bank of India and other regulatory authorities for their support and valuable guidance. The Board also thanks other Financial Institutions and correspondent banks for their cooperation.

The Board of Directors expresses their gratitude to the loyal customers for their trust and continuous patronage of the Bank. The Board also thanks the Staff Unions/Associations and shareholders of the Bank for the support extended by them. The Directors place on record their deep appreciation of the dedication shown by each employee of the Bank due to which the Bank could achieve many milestones

By order of the Board of Directors

(R. K. Takkar)

Managing Director &

Chief Executive Officer

Place: Kolkata

Date: 02.06.2016