Professional Documents
Culture Documents
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ACKNOWLEDGEMENT
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Tariq Ahmad Wani
Cer tificate -1
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Table of Contents
CONTENT Page No
INTRODUCTION TO THE FINANCE & FINANCIAL MGT.
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INTRODUCTION TO BANKING
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NON-PERFORMING ASSET(INTRO, MEANING, DEFINITION, CLASSIFICATION FOR
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MAKING PROVISIONS,CAUSES FOR NPA’S)
DEFINITION OF SECURITIZATION,MEASURES OF ASSETS RECONSTRUCTION
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STEPS TAKEN BY RBI TO CURTAIL NPA, RECOVERY TOOLS
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STATEMENT OF THE PROBLEM,OBJECTIVE,SCOPE,NEED,RESEARCH,DESIGN
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INTRODUCTION TO J&K BANK
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HISTORICAL BACKGRODND OF J&K BANK
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NAME OF BOARD OF DIRECTORS
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ANALYSIS & INTERPRETATION OF DATA
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SUMMARY OF FINDINGS
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CONCLUSION
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RECOMMENDATIONS
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QUESTIONNAIRE FOR MANAGERS
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BIBLIOGRAPHY
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INDUSTRIAL BACKGROUND:
INTRODUCTION TO FINANCE:
In our present day of economy, finance is referred as the provision of money at a time when it is
required. Every enterprise big, small or medium needs finance to carry on its operation and achieve
its targets. In fact, finance is so indispensable that it is rightly said that it is the “Life blood of an
enterprise”. Without adequate finance, an enterprise can’t think of its existence. The study of
principals, practices, procedures and problems concerning financial management of profit making
organization engaged in the fields of industry, trade and commerce is undertaken under the discipline
of “BUSINESS FINANCE”.
BUSINESS FINANCE:
The term business finance is composed of two words i.e. business and finance. Thus it is essential to
understand the meaning of these two words, which is the starting point to develop the whole concept
of finance.
MEANING OF BUSINESS:
The word business may be interpreted in one way as “State of being busy”. All human creative
activities which are related to the production and distribution of goods and services for satisfying
human needs are known as business.
MEANING OF FINANCE:
Finance is referred to as the provision of money at a time when it is required. Finance refers to the
management of flow of money through an organization. Having studied the meaning of business and
finance, we can develop the meaning of the term business finance as an activity, which is concerned
with the acquisitions of funds and distribution of profits by a business firm. Thus business finance
deals with the acquisition, application, allocation of funds and financial control.
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DEFINITION OF BUSINESS FINANCE:
According to Guttmann and Dougall, business can be broadly defined as “the activity concerned with
planning, raising, controlling and administering the funds used in the business”. Wheeler defines
business finance as “The activity which is concerned with the acquisition and conservation of capital
funds in meeting the financial needs and overall objectives of business enterprise”.
In simple words, the financial management as practiced by corporate firms can be called as
corporate finance or business finance.
FINANCIAL MANAGEMENT:
INTRODUCTION:
Financial management is concerned with the efficient use of resource, namely capital funds.
Financial management refers to that part of the management, which is concerned with the
planning and controlling of firm’s financial resources. It deals with finding out various
sources of funds for the firm. The sources must be suitable and economical for the needs of
the business. The appropriate use of such funds also forms a part of financial management.
Finance is the lifeblood of business and every business unit needs money to make more
money, but money will get more money only when it is managed properly.
Financial management is absolutely necessary for every business unit, which is required to
make more money.
In the words of Collins brooks “Bad production and sales management slain hundreds but
faulty finance slain thousands”.
Financial management helps a firm in optimizing the output from given input of funds.
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OBJECTIVES OF FINANCIAL MANAGEMENT:
1. BASIC OBJECTIVES:
a) Maintenance of adequate liquid assets in a firm:
This objective implies that financial management should ensure that there are always
adequate cash in the hands of the firm to meet its obligations.
b) Profit maximization:
A business firm is a profit seeking organization. Naturally the profit maximization will be one
of the most important objectives of financial management. The earnings or the profits of a firm
can increase either by increasing the output or by minimizing the cost of the production for a
given output. The objective of profit maximization implies that any financial decisions would
be evaluated on the basis of its overall contribution to the profits or earnings of the enterprise.
c) Wealth maximization:
Wealth maximization is an appropriate objective of an enterprise. Financial theory asserts that
wealth maximization is the single substitute for a stock holder’s wealth. The individual stock
holders can use this wealth to maximizing the stock holder’s wealth and the firm can operate
consistently towards maximizing stock holders utility.
2. OTHER OBJECTIVES:
a) Ensuring maximum operational efficiency through planning, directing and controlling of
the utilization of the funds i.e. through effective employment of funds.
b) Enforcing financial decision in the organization while using financial resources through
coordination of the operations of the various decisions of the organizations.
c) Building up of adequate resources for financing growth and expansion and ensuring fair
returns to share holders.
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INRODUCTION TO BANKING:
Banking is nothing but a service. Banks are business organizations selling banking services.
Banks continuously reassess how a customer views bank services, what are new and
emerging customer aspirations and how these can be satisfied.
ORIGIN:
Since the banking activities were started in different periods in different countries, there is no
unanimous view regarding the origin of the word bank. The word bank is derived from the
French word ‘banco’ or ‘Bancus’, which means a bench. Infact the early Jews in Lombardy
transacted their banking business sitting on benches. When the business ailed, the benches
were broken and hence the word bankrupt came in to vogue.
DEFINITION:
The Indian Banking Companies Act, 1949 section 5(b), defines banking as “accepting for
purpose of lending or investing of deposits from the public, repayable on demand or
otherwise and withdrawals by cheque, drafts, and orders or otherwise”.
Banks are backbone of our society. A bank must meet the financial needs of a customer, by
acting as a custodian of his assets, providing credit facilities and assisting him to speedily put
through financial transaction of one type or another. Banking when you comer to think of it is
people. It is not figures, files and ledgers. Bank services needs considerable improvement on
an emergent basis. The time has come for banks to look inward to find out what is the nature
and quality of the products they sell, what is the product demanded by the customer.
It would be unrealistic today to believe that banks are mere financial institutions, working for
profit. Banks essentially are now social organizations, regarding financial services to sub
serving the socio-economic objectives of the society.
IN INDIA:
India has a system of indigenous banking from very early times, though it was not similar to
banking of modern times. There is evidence to show that money lending existed even during
the Vedic period. With the advent of the English traders in the seventeenth century and the
establishment of trading centers by the East India Company encouraged the establishment of
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what were known as the agency houses? The trading firms which undertook banking
operations for the benefit of their constituents. Some of the houses established during the
period were Alexander and Co. and Ferguson & Co. There were also Presidency Banks, Joint
stock banks and Exchange banks which took up gradually one after the other.
IMPERIAL BANK:
The Presidency Banks referred to above were amalgamated into the Imperial Bank of India,
which was brought into existence on 27th January 1921 by the Imperial Bank of India Act
1920. This Act, however, gave the bank no power to issue notes and this left out without
control over the currency of the country. But it was allowed to hold Government balances and
to manage public debt and clearing houses till the establishment of Reserve Bank Of India in
1935 which apart from taking over all these functions from the Imperial Bank of India, was
given the privilege of acting as an agent of the latter in places where it had no branches.
COMMERCIAL BANKS:
Amongst the banking institutions in the organized sector, the commercial banks initially were
established as corporate bodies with share holdings by private individuals, but subsequently
there has been a drift towards central ownership and control. Today 27 banks constitute the
strong public sectors in Indian Commercial Banking. Up to late 60’s Commercial Banks are
mainly engaged in financing organized trade, commerce & industry , since then they are
actively participating in financing agriculture, small-scale business ands small borrowers
also.
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SECONDARY FUNCTIONS:
Commercial banks perform a multitude of other non banking functions, which may be
classified as
The major historical event in the history of banking in India after independence is
undoubtedly the nationalization of the 14 major banks on 19th July 1969. In 1980, six more
private sector banks are nationalized extending the public domain further over the banking
sector. Nationalization was deemed as a major step in achieving the socialistic pattern of
society. The nationalized banks were to increase lending to areas of importance to the
government and to use their resources for sub-serving the common good. A detailed scheme
of objectives, regulations, management, etc was drawn up for these banks.
Nationalization was recognition of the potential of the banking system to promote broader
economic objectives. The banks had to reach out and expand their networks so that the
concept of mass banking was given importance over class banking.
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THE RESERVE BANK OF INDIA [RBI]:
The Central Bank of India called the Reserve Bank of India was constituted under the
Reserve Bank of India Act, 1934 to regulate the issue of bank notes and keeping of reserves
with a view to securing monetary stability in India and generally to operate the currency and
credit system of India to its advantage. Amongst its multifarious functions affecting the
Indian Financial System, the RBI regulates and prohibits the issue of prospectus or
advertisement soliciting deposits of money, regulates the functioning of non-banking
institutions and transacts Government business. Its regulatory involvement in the Indian
Capital Markets is primarily of debt management through primary dealers, foreign exchange
control and liquidity support to market participants. The RBI regulates participants in the
securities markets when a foreign transaction is involved. Transactions that include Indian
issuers issuing of security outside India, such as GDRs and ADRs, and Financial Institutional
Investors (FIIs) or Foreign Brokers selling, buying or dealing in Indian Securities need the
permission of RBI.
As the central banking authority of India, the Reserve Bank of India performs the following
traditional functions of the central bank:
I. It provides currency and operates as the clearing system for the banks.
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It seeks to integrate the unorganized financial sector with the organized
financial sector.
It encourages the extension of the commercial banking system in the
rural areas.
It influences the allocation of credit.
It promotes the development of new institutions.
Banking sector reforms have brought about considerable shift in the progress of different
banks. Credit has once again gained importance. Technology has brought banking to the very
doorstep of customers. With the coming of foreign banks, competition has increased and they
are models for the other banks in terms of service level, banking convenience technology and
staff productivity. In order to keep them alive in the race for survival and in order to increase
profitability, banks have been forced to become active in offering services to customer. In
fact globally the dominance of internet and cyber banking has changed the banking scenario.
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ROLE OF BANKS IN ECONOMIC DEVELOPMENT:
Commercial banks are playing a crucial role in the economic development of the country. In
fact without the development of commercial banks in 18th century, industrial revolution
would not have taken place in England at all. It is also true that economic development of
country depends entirely on the development of sound commercial banking.
Banks provide short term loans which serve as capital for industrial establishment. Without
capital it is impossible to start an industry. After starting the industry, the banks provide the
industrialists necessary working capital. Thus by providing with investment capital and short
term working capital, the banks encourage industrial advancement in the country.
Banks extend credit facilities to industry and trade to develop right type of industry and
business. Expansion of credit will provide more funds for the entrepreneurs to start new
industries, which results in more employment and income. Commercial banks by providing
funds encourage production and cause an increase of national income by means of
transferring surplus resources obtained from rural sector. Banks promote capital formation by
means of pooling savings from the people. They mobilize the idle and dormant capital of the
community and provide it for investment. Banks can also influence the economy in so many
other ways. Banks can regulate the interest rates in the money market by means of regulating
the supply of the funds. A cheap money policy with low rate of interest will tend to stimulate
economic activity during the period of inflation. A reverse policy is followed during
depression.
BANKING SCENARIO:
During the year 2005-2006, the reserve bank of India took several initiatives aimed at
improving the prudential regulation. These include stipulating higher provisioning
requirement for NPAs included under “doubtful for more than three years” category effective
from March 31, 2006, prohibiting banks from investing in unrelated non-SLR securities,
advising banks to maintain capital charge for market risk etc. Further several initiatives were
also taken during the year aimed at improving the credit delivery to the agricultural and SSI
sector. The govt. announced a comprehensive policy envisaging a 30% increase in agriculture
credit in 2005-06 and doubling the credit flow to the agriculture sector in three years.
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LOAN:
A loan is a financial transaction in which one party (the lender) agrees to give another party
(borrower) a certain amount of money with the expectation of total repayment. The specific
terms of a loan are often spelled out in the form of a promissory note or other contract. The
lender can ask for interest payments in addition to the original amount of the loan (principal).
The borrower must agree to the repayment terms, including the amount owed, interest rate
and due dates. Some lenders can also assign financial penalties for missed or late payments,
because a loan can contain many hidden costs such as interest payments and finance charges.
Many people tend to avoid applying for one until it becomes absolutely necessary.
Purchasing a new vehicle or home always necessitates some form of financial loan, whether
it is a bank mortgage or a private loan with the seller. Financing a higher education may also
require a federally-backed student loan. Interest rates on these types of large loans can be
fixed at the time of the application or may vary according to the federal prime interest rate.
There is a very important legal difference between a gift and a loan. A very generous relative
or friend may give you $ 5000 for car repairs, for example, if there is no expectation of
repayment, the money can be considered as a gift. The giver could not sue for repayment later
in a civil lawsuit. But if the lender designates the money as a loan and the borrower pays back
even one dollar, the money can be considered a legal loan and the lender can demand
repayment anytime. Small claims courts spend much of their time determining whether or not
a transaction involving money was a gift or loan. This is why paperwork is essential, when
making private loans to friends or relatives.
Most loan applications are handled by banks or other professional lending institutions. They
may use any number of criteria to determine if a potential borrower is eligible for a loan. Past
credit history is always considered, along with current income and assets. The purpose of the
loan may also be a factor-a proven investment opportunity may have more appeal than an
unproven idea for a new restaurant. One important consideration is the income to debt ratio of
the borrower. Can the borrower afford to pay the loan back with interest? Professional
lenders essentially ‘sell’ money, so borrowers must realize how much a loan actually ‘costs’
in terms of real dollars and cents.
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(B) REVIEW OF THE RELATED LITERATURE:
An asset becomes Non Performing Asset (NPA) when it ceases to generate income for the
bank. Earlier an asset was considered as Non-Performing Asset based on the concept ‘Past
Due’ for a specific period of time. The specific period was reduced in the phased manner as
under:
With effect from March 31, 2001, ‘overdue’ concept is to be used instead of ‘past due’ for
classifying an asset. Accordingly, as from March 31, 2001 a Non-Performing Asset (NPA)
shall be an advance where
An amount is considered as ‘Past Dues’, when it remains outstanding for 30 days beyond the
due date. However, with effect from 31st march 2004, however gold loans and small loans up
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to Rs.100000 have been exempted from the 90 days norm for recognition of loan impairment,
such loans would continue to be governed by 180 days norms for classification as Non
performing Asset even after this date Accordingly with effect from 31st march 2004, a non
performing asset shall be a loan or van advance where:
Interest/installment of principal remains overdue for a specific period of more than 180 days
in respect of a term loan.
1. The account remains ‘out of order’ for a period of 180 days in respect of
overdraft/cash credit.
2. The bill remains overdue for a period of 180 days in case of bills
purchased or discounted.
3. Interest/installment of principal remains overdue for two harvest seasons
but for a period not exceeding two half year in case of an advance granted
for agriculture purpose.
4. Any amount to be received remains overdue for a period of more than
180 days in respect of other accounts.
As a facilitating measure for smooth transactions to 90 days norms, banks advised to move
over to charging of interest at monthly rests, by April 1, 2002. However the date of
classification of an advance as Non-Performing asset should not be changed on account of
charging of interest at monthly rest. Banks should, therefore, continue to classify an account
as Non-Performing Asset only if the interest charged any quarter with effect from April 1,
2002 and 90 days from the end of the quarter with effect from March 31, 2004.
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INTRODUCTION:
It’s a known fact that the banks and financial institutions in India face the problem of
swelling non-performing assets (NPA’s) and the issue is becoming more and more
unmanageable. In order to bring the situation under control, some steps have been taken
recently. The Securitization and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 was passed by parliament, which is an important step towards
elimination or reduction of NPA’s.
In late 80s the concept of classification of bank advances in several health code categories
took place though the terminology non-performing advances did not exist at that time. This is
followed by early 90s Anglo-American model of categorization of bank lending portfolio in
several blocks of nomenclature in that included the non-performing advances.
The rapid popularity of the phenomenon can be ascribed to the opening up of the Indian
economy and consequent pressure from western powers to influence our banking system in
the name of international standards of accounting, congruence of banking supervision by
Basle committee, and so on.
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MEANING OF NPA’s:
An asset is classified as non-performing asset (NPA’s) if the borrower does not pay dues in
the form of principal and interest for a period of 180 days. However with effect from March
2004, default status would be given to a borrower if dues are not paid for 90 days, if any
advance or credit facilities granted by bank to a borrower become non-performing, then the
bank will have to treat all the advances/credit facilities granted to that borrower as non-
performing without having any regard to the fact that there may still exist certain advances/
credit facilities having performing status. In simple words, an asset which ceases to yield is a
non-performing asset.
The committee has defined non-performing assets as advances here, as on the date of balance
sheet,
1. In respect of term loans, interest remains past due for a period of more than 90 days.
2. Overdrafts and cash credits accounts remain out of order for more than 90 days.
3. Bills purchased and discounted remain over due and unpaid for a period of more than
90 days.
An amount is considered past due when it remains outstanding for 30 days beyond the
due date.
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RBI REGULATION REGARDING INCOME RECOGNITION,
ASSETS CLASSIFICATION AND PROVISIONING:
INCOME RECOGNITION:
RBI has notified regulations concerning the income recognition of banks while accepting the
recommendations of the Narasimham committee report. The following is the regulations
regarding income recognition of banks:
Performing assets
Non-performing asset
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I) PERFORMING ASSETS:
Performing assets is also known as standard assets/loans, where the interest or principal are
not overdue beyond 180 days at the end of the financial year. Such loans don’t carry more
than the normal business risk.
Any loan the repayment of which is overdue beyond 180 days or two quarters is considered
as NPA. It is further classified into:
a. Sub-standard assets
b. Doubtful assets
c. Loss assets
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make collection or liquidation in full, on the basis of currently known facts, conditions and
values, highly questionable and improbable.
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I). Willful default:
Some borrowers though have the capacity and resources to repay the loan will not do the
same. These sorts of people will come under willful defaulters. They will take advantage of
the loopholes in the legal system. As per RBI guidelines, willful default broadly covers the
following:
1. Deliberate nonpayment of the dues despite adequate cash flow and good net worth.
2. Assets financed have either not being purchased or have been sold and the proceeds
have been misutilised.
3. Misrepresentation/ falsification of records.
4. Disposal/ removal of securities without the banks knowledge.
5. Fraudulent transaction by the borrower.
The identification of the willful defaults is to be made keeping in view the track record of the
borrower and not on the basis of isolated transaction/ incident. The default to be categorized
as willful must be intentional, deliberate and calculated.
II). Failure of a business unit either resulting from lack of its own competitive advantage or
generic weakness of the industry. Business failure like product failing to capture the market,
inefficient management, strike or strained labour relations, wrong technology, technical
problems, product obsolescence, etc.
III). Lack of adequate risk assessment and monitoring system within the bank. Absence of
proper credit management system is a very serious issue i.e., in many of the Indian banks
particularly state owned ones there are several dimensions to the problem. The most
important being the lack of trained manpower i.e. the analysts should be in adequate number
to appraise critically the credit worthiness of the potential clients.
IV). Lack of prudential regulation. Risk management practices can be effective only when
financial statements present accurate picture of level of risk.
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VI). Internal factors like raw material shortage, raw material/input price escalation, power
shortage, industrial recession, excess capacity, natural calamities like floods, accidents, etc.
VIII). Deficiencies on the part of the banks viz. in credit appraisal, monitoring and follow-
up, delay in release of limits, delay of settlement of payments or subsidies by govt. bodies
etc.
In conclusion, this means that the management of non performing advances depends on the
causes rather than treating the lag indicators which are nothing but symptoms. If all the five
causes stated above are taken care of, the problem, at least the intensity of it would have
automatically come down. It should be appreciated that the issue on non performing advances
is serious as the absence of income stream from this category of assets causes continued
deterioration in the health of banks. Taking piecemeal corporate debt recast body will only
not solve the problem., but also keep the real issues underground that may cause more
damages in future on a long term basis.
Early identification:
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III) A systematic review of problems loans should be done. The time norms for the
problem loan review should be adhered to. Action plan to be drawn up for each
account and follow up.
Recovery:
Actual recovery occurs in the accounting in which the total recovery of the dues is
warranted. Through regular pre and post sanction monitoring, follow-ups, the NPA’s can
be eliminated.
Up gradation:
The NPA accounts in which part recovery of the total, dues will upgrade the account from
NPA to performing asset. Generally the NPA accounts with less than 2 years of the age under
NPA are covered. The main characteristic of these accounts is after elimination from NPA,
also these accounts continued to be part of advances. Since lending is a main business of the
banks up gradation of accounts is preferred.
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Rehabilitation:
Rehabilitation of units should be taken up in deserving cases.
Repayment:
Fixing repayment programme for accounts while continued viability is in doubt.
Fixing installments for irregular amount were limits to be continued with reduced
exposure.
Compromise:
Through compromise the accounts are closed by negotiated settlement with the borrowers as
per the compromise policy of the bank. Generally compromises are encouraged in cases of
chronic NPA accounts.
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THE SECURITISATION AND RECONSTRUCTION OF
FINANCIAL ASSETS AND ENFORCEMENT OF SECURITY
INTEREST ACT, 2002 (SARFAESI ACT):
There was an acute need being felt for assistance to the banks and other financial
institutions in the recovery of loans, for there were heavy losses being incurred on
account of unpaid debts. To regulate securitization and reconstruction of financial assets
and enforcement of security interest the president, on 21st day of June 2002 promulgated
the securitization and reconstruction of financial assets and enforcement of Security
Interest Act.
Definition of securitization:
Securitization means acquisition of financial assets by any securitization company or
reconstruction company from any originator, whether by raising of funds by such
Securitization Company or Reconstruction Company from qualified institutional buyers
by issue of security receipts representing undivided interest in such financial assets.
When the borrower fails to repay the loan amount, then according to RBI guidelines the
construction company can take following measures:
The proper management of business of the borrower, by change in, or take over
of, the management of the business of the borrower.
The sale or lease of a part or whole of the business of the borrower.
Rescheduling of payments of debts payable by the borrower.
Enforcement of security interest in accordance with the provisions of this Act.
Settlement of dues payable by the borrower.
Taking possession of secured assets in accordance with the provisions of the act.
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STEPS OR INTIATVES TAKEN BY RBI TO CURTAIL NPA:
Recognizing the fact that the origin of Non-performance could be at the initial stage of loan
decision-making, RBI had impressed upon banks from time to time, to strengthen credit
appraisal and credit supervision. After sanction and dispersal of credit, banks are required to
closely monitor the operation of the borrower units and accounts by way of ostentation of
periodic stock/operation statements brought down, end use, etc. in the cases of incipient cases
sickness, nursing back the sick units, etc. problem accounts above a certain outstanding
balance are required to be monitored individually by designated senior officials of the bank.
In respect of accounts where the classification of assets of the banks are required to take
prompt steps to recover the dues and staff accountability is required to be examined.
Banks have also been advised to take decisions regarding finding of source expeditiously and
to effectively follow up the cases of suit filed and decreed accounts. During periodic
discussions with bank management, special emphasis is given on monitoring of large NPA
accounts at the highest level in the banks and also on reductions of NPA through up
gradation, recovery and compromise settlements. RBI has advised and accordingly bank
boards have laid down policies in regard to credit dispensation, recovery of credit etc. Banks
have constituted recovery cells, recovery branches and NPA management departments and
fixed recovery targets.
Policies evolved and steps taken in this regard are critically examined during the annual on
sight inspection of banks. The off sights returns also provide RBI and insight into the quality
of credit portfolio at quarterly intervals.
Introduction of prudential norms on income recognition, asset classification , provisioning
during 1992-93 and other steps initiated apart from beginning in transparency in the loan
portfolio of banking industry have significantly contributed towards improvement of the pre-
sanction appraisal and post sanction supervision which is reflected in lowering of the levels
of fresh accretion of non-performing advances of banks after 1992.
RBI impressed upon the banks to strengthen the credit appraisal and credit
supervision.
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Reduction in transition period of sub-standard asset to doubtful category to
12 months as against the current norm of 18 months effective from March
2005.
Revision in the CRAR norms in terms of new Basel Capital Accord after
2005.
RBI has advised and accordingly bank’s boards laid down policies in regard
to credit dispensation, recovery of credit, etc.
Policies evolved and steps taken are critically examined during the annual
on sight inspection of banks.
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The act applies only to cases where the amount of debt due to banks/financial institution is Rs
10 lakhs or above. Filing of cases at the DRT has been a cause of concern for almost every
bank in the country today. One reason for the slow pace is the requisite infrastructure at the
respective DRT was inadequate to handle the huge number of cases pending with it. There
has been a decision to add about 7 more DRT to the existing 22 DRT and 5 appellate
authorities. This enables the banks to settle some of the pending NPAs.
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2. LOK ADALATS:
For recovery of smaller loans, the Lok Adalat has proved a very good agency for quick
justice and settlement of dues. The Gujarat State Legal Service Authority and the DRT,
Ahmadabad have nominated and appointed conciliators to deal with the cases before the
Lok Adalat comprising of retired High Court Judge and two members from senior
advocates/industrialists/executives of the banks. These Adalats in the state of Gujarat
have been found to be useful as supplement to the efforts of the efforts of the recovery by
the DRTs. Such agencies should be established in all the states.
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business volumes, non-interest income, recovery and cost control are likely to increase
further. Technology would further influence customer service, delivery of products and risk
management practices. In order to conform to the global best practices in the area of risk
management, banks would be increasingly focusing more on new types of risk like
operational risks.
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STATEMENT OF THE PROBLEM:
The scope of this study is limited only to the study of non performing asset management in
Jammu & Kashmir Bank Limited, cluster 2nd north.
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(d) NEED FOR THE STUDY:
The need for the study is to identify the bank’s impact on profitability due Non
performing asset to identify the various causes for NPAs and ways to reduce NPA
and ways to reduce NPA.
The need is to identify NPAs in all branches of Jammu & Kashmir Bank & the
methods adopted by Jammu & Kashmir Bank to reduce to the same.
(a) RESEARCH DESIGN OF THE STUDY:
The conception of the research design plan is a critical step in the research process. The
design of the study constitutes the blue print for the collection, measurement and analysis of
the data. In other words, the research design is a conceptual structure with in which research
is conducted.
PRIMARY SOURCE:
“Primary data is first hand information which is collected a fresh and thus happens to be
original in character”
The primary data was collected by the way of well framed Questionnaire. Questionnaire was
administered to gather the information relating to NPA from the managers from all the
branches of Bank.
SECONDARY SOURCE:
“Secondary data are those which have already been passed through the statistical process”.
The data which was pre-essential for this study relating to management of NPA was based on
secondary source of data. This data was collected from materials provided by bank, annual
reports, management reports, magazines, journals, RBI circulars and some essential books on
banking was referred. Some information was also obtained from J&K Bank website.
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(c) SAMPLING PLAN:
Population Size:
The population size is the managers of Jammu & Kashmir Bank in cluster 2nd north.
Sample Size:
10 branches of Jammu & Kashmir Bank
Sample Method:
Random Sampling is used for all branches of Jammu & Kashmir Bank.
(d) LIMITATIONS:
Some of the information is considered confidential and not available for the study.
The data collected is raw and it is complied, classified, tabulated and then analyzed using
financial techniques and statistical tools. Graphs and charts are used to highlight the statistics.
Based on these data and analysis, inferences were drawn.
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(f) CHAPTER SCHEME:
Chapter-IV gives the profile of the bank, its mission, vision, and
Financial details.
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INTRODUCTION TO THE J & K BANK:
Jammu and Kashmir bank was incorporated on 1st October, 1938 and commenced business in
July, 1939. From a small beginning the bank has grown to become a giant with a network of
520 branches spread over the length and breadth of the country.
The J & K Bank is the first state owned bank of the country and 53% of equity is held by the
government of Jammu and Kashmir. The bank has a consistent track record of growth and
profitability. It has a unique distinction of being banker to the Jammu and Kashmir state
government and has also been appointed by RBI as its agency in J & K, responsible for
carrying general banking business of the Central government and collection of taxes
pertaining to the Central Board of Direct Taxes.
J & K Bank has over the past few years been reporting sustained excellent performance in all
the vital areas of business and achieving record-breaking levels in profit generation. However
what I feel is more reassuring is that bank is quietly working on a much larger objective of
setting a strong foundation that will serve as a launching pad to support the aggressive growth
plans in the future. J & K Bank has today acquired significant financial strengths on key
bench marks that will give it great confidence in the journey forward.
Today the bank has a status of value driven organization and is always working towards
building trust with shareholders, employees, customers, borrowers, regulators and other
diverse stakeholders. It has adopted a strategy directed to developing a sound foundation of
relationship and trust aimed at achieving excellence which of course comes from the womb
of good corporate governance. Good governance is a source of competitive advantage and a
critical input for achieving excellence in all pursuits. J & K Bank considers good corporate
governance as the sine qua non of a good banking system and has adopted a policy based on
all four pillars of good governance –transparency, disclosures, accountability and value,
enabling it to practice trusteeship, transparency, fairness and control, leading to stakeholders
delight, enhanced shareholder value and ethical corporate citizenship. It also ensures that
bank is managed by an independent and highly qualified Board following best globally
accepted practices, transparent disclosure and empowerment of shareholders, besides
ensuring to meet shareholder aspirations and societal expectations following the principals of
management executive freedom to drive the bank forward without undue restraints but within
the framework of effective accountability. The excellence achieved by the bank in its
operations stemming from the roots of voluntary and bank has recently bagged three very
prestigious award for following fair business practices and commitment to social obligations.
38
HISTORICAL BACK GROUND OF J&K BANK:
Before independence moneylenders use to perform entire banking in the Jammu and Kashmir
state that too on exorbitant interest rates. Punjab National Bank, Imperial Bank of India and
Grind lay’s bank were the banks that use to take deposits but no lending due to their statutory
limitations. Money lenders mostly known as Munimji conducted financial transactions in the
entire state of Jammu and Kashmir. Under this scenario banks could not ameliorate the
financial and social position of the people of the state. To overcome this critical situation, the
then Maharaja of the state conceived an idea of setting up of a state bank in the state.
After a prolonged exercise and deliberations the assignment for establishment of “The Jammu
and Kashmir Bank limited” was given to the late Sir Sorabji N Pochkhanawala, the then
Managing Director of the Central Bank of India. Mr. Pochkhanawala formulated a scheme on
24-09-1930, suggesting establishment of a semi state bank with participation in capital by
state and the public under the control of state government. Thus the bank was formally
incorporated on the 1st of October 1938 and commenced business from 4th of July 1939 at its
registered office Residency road Srinagar, Kashmir.
The Jammu and Kashmir bank Limited has been the first of its nature and composition as a
state owned bank in the country. The state government besides contributing half of the issued
capital also appointed it as its bankers for general banking and treasury business. In its
formative years, the bank had to encounter several serious problems particularly around the
time of independence when out of its total of ten branches; two branches of Muzaffarabad
and Mirpur fell to the other side of the line of control (now Pakistan Administered Kashmir)
along with cash and other assets in 1947. However the State government came to its rescue
with the assistance of Rs.6.00 Lacs to meet the claims, however the bank fastly over came its
difficulties and kept growing. Following the extension of Central Laws to the state of Jammu
and Kashmir, the bank was defined as a government company as per the provisions of Indian
Companies Act 1956. The bank had its first full time chairman in 1971, following social
central measures in banks. The year 1971 was a turning point for the bank on conferment of
scheduled bank status and witnessed remarkable progress in all the vital fields of operations.
The bank was declared as “A” class bank by Reserve Bank of India in1976. In recognition of
dominant role and exalted performance, Reserve bank of India as its agent for performing the
general banking business of the central government especially in maintaining currency chests
and collection of taxes.
39
FINANCIALS DETAILS:
While registering a business turnover of Rs51,975.56 crore during the quarter ended
june,2009, the J&K bank recorded an increase of 41% over the corresponding period of
the previous year in the operating profit which increased to Rs256 crore. For the said
quarter, the bank recorded ante profit of Rs117.05 crore, an increase of 24% over
Rs94.56 pertaining to the corresponding period of the previous year.
The bank announced the un-audited financial results for the quarter end
June 2009,following the approval of its board of directors in a meeting held on July
14.2009
“The financial results of the bank speak the performance despite adverse
market conditions prevailing in J&K state.Infact, the growing profits vet the renewed
strategy where bank has focused on J&K state and banks investment strategy in a
declining interest rate scenario,”. Further the bank has leveraged technology to maximize
efficiency in the system and also to bring down the operating expenses
The Gross NPAs and the net NPAs as proportion of gross and net customer
assets for the quarter ended June , 2009 were at 2.44% and 0.77% respectively. The NPA
coverage ratio, whish is an indicator of safety and shows the level of provision has for its
bad assets, has gone up to68.79%from59.53% a year ago. It is now amongst the highest in
the industry’s result of efficient leveraging of its assets, the bank has been able to bring
down its cost to income ratio to32.79% a year ago. The return on assets has improved to
1.29%(annualized)compared to 1.16%a year ago.
Dr.Drabu cited productization of financial services, where the bank has
tailored a wide range of products to suit various sectors of economy, be it
agriculture,horticulture,artisianor industries sector, as a major contributing factor for the
healthy performance of the bank. This initiative has resulted in tapping the un explored
areas of our economy and enhanced our outreach to unbanked areas in the state” he
emphasized.
“Due to improvement in yield on advances from10.37%in financial year2008-
2009 to 11.5% for the current quarter, the interest income on advances went up by 19%
on a y on basis. Despite increase in interest expenses by 20%y on y, attributed to rising
cost of deposits, bank has been able to maintain its margins at 3.10% due to concurrent
increase in the lending rates.
40
Operating income(net interest income plus other income) stood at Rs 381.67 crore
for the quarter ended June 30,2009 as against Rs291.13crore for the corresponding
quarter of last fiscal registering an increase of 31%. The other income of the bank has
gone up by 78% to Rs115.68crore from Rs 64.88 crore a year ago, largely on account of
trading income.
The bank has restructured loans during the quarter to the extent of around
Rs100 crore mostly by way of realignment of interest rates.
The capital adequacy ratio under the Basel I norms stands at 14.33% at the year
ended of June 30,2009 and Tier 1 capital amounted to 13.63 % .Net worth of the bank
stood at Rs 2739.91 crore as on June 30,2009 compared to Rs 2403.49 crore a year
earlier, registering a growth of 14%.
INNOVATIVE PRODUCTS:
To maximize value to its customers, the innovation in products and improving the quality and
speed of services is the hallmark of Bank’s business strategy. In keeping with this objective,
the bank has launched several unique and innovative deposit products, which includes
“Mehendi Deposit Scheme”, “Recurring plus Deposit Account”, “Flexi Deposit Scheme”,
etc. These schemes have flexibility of depositing variable monthly installments as per the
convenience of the depositor. In synchronization with the Bank’s new strategy focus on
increasing lending and financial deepening of economy in J & K state, a host of new products
customized and tailored to the requirements of customers were designed and launched. Some
of these products are:
All purpose Agri-Term Loan.
JKBank Term Loan for B.Ed/M.Ed Courses.
Housing Loan for Leh.
Tax Saver Term Deposit Scheme.
Smart Saver.
Naunihalon Ka Naya Savera.
Used-car Loan
Value Added Current Accounts.
JK Bank Dastkar Finance Scheme
JK Bank Khatamband Scheme
JK Bank Roshni Finance Scheme
41
DIVERSIFICATION OF BUSINESS:
The Bank diversified its business activities into insurance, both life and non-life. The
bank not only became the strategic partner of MetLife Insurance India (P) Limited,
but also has been acting as corporate agent of the said company for distribution of
their life insurance products through network of its branches. The Bank also entered
into a tie-up with Bajaj Allianz General Insurance Company for distribution of their
non-life insurance products. In view of Bank’s deep branch network and loyal
customer base particularly in Jammu and Kashmir, the Bank has been able to
distribute insurance products in deep rural and far flung areas and has made
penetration in the new areas thereby adding to its non-interest and fee based income.
42
properties, museums, libraries, protection of environment/ecology, etc and
sponsoring seminars and awareness camps, art and literary works, social service
camps, etc. The Bank has been playing a vital role in the promotion of tourism and it
is in this backdrop that the bank has been shouldering the responsibility of registering
yatris for the Shree Amarnathji Yatra through its extensive network of branches
spread across the country. Apart from above activities the bank has been
constructing/developing the public utility service like public parks, bus stands,
drinking water posts, lavatories, rain shelters, etc. The glimpses of some programmes
of the bank launched for this purpose are as under:
MISSION:
The mission of J & K Bank is two-fold: TO provide the people of J & K international
quality financial service and solutions and to be a super-specialist bank in the rest of
the country. The two together will make J & K Bank, the most profitable bank in the
country.
43
TECHNOLOGY DRIVEN OPERATIONS:
Maintaing a progressive outlook, the J & K bank is keeping pace with the changing
technology. The bank continues to leverage information technology as a strategic tool
for its business operations. The highlights of information technology initiatives
undertaken by the bank during 2008-09 are as under:
44
NAME OF THE BOARD OF DIRECTORS:
The various new business initiatives taken by Jammu and Kashmir Bank Limited are as
under:
Investment banking.
Channel financing.
45
Classification and Tabulation of Data:
Classification of Data:
Classification is the process of arranging. It is done prior to tabulation.
Tabulation of Data:
After the transcription of data is over, data is summarized ands arranged in compact form for
the analysis. This process is known as tabulation. It involves counting of number of cases into
each of several categories. It can be done through manually, mechanical or electronic devices.
The choice depends upon the size and type of the study, cost considerations and time
availability.
In this section analysis and interpretation of data collected from the managers of Jammu and
Kashmir Bank Limited is made. The data was collected through Questionnaire. The
tabulation is shown below.
2-3 2 20
3-5 3 30
Source: Questionnaire.
46
Analysis:
We can observe that 50% of branches are functioning since 5 years & all other branches are
functioning from a minimum period of 2-3 years.
Inference:
The above table shows that most of the branches of J&K Bank have been functioning since 5
years and above. Hence the management is looking forward for the maintenance of the
present branches.
60
50
50
Percentage
40
30
30 Percentage
20
20
10
0
0
e
s
ov
s
ar
ar
ar
ab
ye
ye
ye
&
3
5
2
2-
3-
s
ar
ye
5
Years
Source: Questionnaire
47
Table 5.2 Showing presence of NPA
1-2 1 10
2-3 2 20
3-4 2 20
5 & above 4 40
Total 10 100
Source: Questionnaire
Analysis:
From the above table it can be interpreted that in nearly 40% of branches NPAs are present
since 5 years and above. And in 20% of branches NPAs are present between 3-4 years. And
in rest of branches NPAs are present from 3 years.
Inference:
NPAs are present maximum in those branches which have been performing since 5 years and
above, it can also be observed that NPAs are present in all branches of J&K Bank.
48
Graph 5.2 Showing presence of NPAs
45 40
40
35
Percentage
30
25 20 20 Percentage
20
15 10 10
10
5
0
s
s
ar
ar
ar
ar
ar
Ye
Ye
Ye
Ye
Ye
e
1
4
2
ov
0-
1-
2-
3-
ab
&
5
Years
Source: Questionnaire
Table 5.3 showing approximate value of NPAs in branches
10-20 2 20
20-30 1 10
30-50 3 30
50 & above 4 40
Total 10 100
Source: Questionnaire
49
Analysis:
From the above table it can be interpreted that in nearly 40% branches NPAs are above 50
lakhs. Another 30% of branches have NPAs of about 30-50 lakhs & in rest of branches NPAs
upto 30 lakhs are found.
Inference:
The branches of the bank have NPAs to quite a large extent. NPAs above 50 lakhs have been
found in 4 branches out of 10 branches.
45
40
35
Percentage
30
25
Percentage
20
15
10
5
0
0-10
10-20
20-30
30-50
50 & above
Amount in Lakhs
Source: Questionnaire
50
Table 5.4 Showing total amount of NPAs in different categories of loan accounts
Analysis:
We can observe that in personal loan category more NPAs are found i.e. RS 3, 06, 00,000
followed by housing loan with an amount of RS 2, 65, 00,000 than the vehicle loan & others.
Inference:
It is observed that personal loan is having more NPAs followed by housing loan & vehicle
loan.
51
Graph 5.4 showing total amount of NPAs in
different categories of loan accounts
4.53
Personal loan
46.27
Vehicle loan
40.06
Agri-term loan
Housing loans
9.12
Source: Questionnaire
Source: Questionnaire
52
ANALYSIS:
We can observe that the willful default is the major cause of NPA formation with a highest
average of 3.5 followed by improper selection of borrowers and deficiency in processing with
a weighted average of 2.5 each, and then lack of supervision and follow up with a weighted
average of 2.33 and then improper appraisal of assets with weighted average of
1 2 3 4 5
S.No. Causes Rs Rs 10- Rs Rs Rs 50 Total Weighted Weighted
10 20 20- 40-50 & respondents total average
40 above
1 Improper 2 1 2 1 0 6 14 2.33
selection of
borrowers
2 Deficiency in 2 1 2 3 0 8 22 2.75
processing
3 Improper 3 0 2 1 0 6 13 2.16
appraisal of
assets
4 Lack of 0 1 1 1 0 3 9 3
supervision
and follow p
5 Natural 0 0 0 0 0 0 0 0
calamities
6 Willful 3 1 2 1 0 7 15 2.14
default
1.INFERENCE:
It can be observed that willful default is the main cause of NPA formation in the bank
followed by improper selection of borrowers.
Source: Questionnaire
Table 5.6.2 Showing the NPA encountered for each of the causes
53
Causes Weighted
Average
Improper selection of borrowers 2.33
Deficiency in processing 2.75
Improper appraisal of assets 2.16
Lack of supervision and follow up 3
Natural calamities 0
Willful default 2.14
Source: Questionnaire
ANALYSIS:
We can observe that the Lack of supervision and follow up is the main cause with weighted
average of 3, followed by deficiency in processing with a weighted average of 2.75, followed
by improper appraisal of assets with weighted average of 2.33.
INFERENCE:
It can be observed that Lack of supervision and follow up and deficiency in processing are
the main causes for such huge NPAs encountered in the bank.
54
G r a p h 5 .6 .2 s h o w in g N P A e n c o u n te r e d fo r e a c h o f th e s e c a u s e s
3 .5 3
3 2 .7 5
2 .3 3 2 .1 6 2 .1 4
2 .5
W e ig h te d
weighted Average
2
1 .5 A ve ra g e
1
0 .5 0
0
Im p r o p e r Im p r o p e r L a c k o f
s e le c tio n Do ef fic ie n ca yp p r a is a sl ou fp e r v is io Nn a tu r a l W illfu l
b o r r o w e r s in a s s e ts a n d fo llo wc a la m itie s d e fa u lt
p r o c e s s in g up
C ause s
Source: Questionnaire
Source: Questionnaire
ANALYSIS:
From the above table, it can be interpreted that nearly 50% of respondents have told that
definitely NPAs can be controlled and another 40% respondents say that NPAs can be
controlled, while 10% of respondents could not make any decision.
55
INFERENCE:
It can be observed that respondents are sure that NPAs can be controlled and reduced.
60 50
50 40
Percentage
40
30 Percentage
20 10
10 0 0
0
No
s
y
fin N o
an s
Ye
sa
Ye
ly
’t
ly
ite
ite
C
fin
De
De
Respondents Response
Source: Questionnaire
56
Table 5.8 Showing effective measures to reduce the NPAs
Measures Weighted
Average
Constant dialog with the borrowers 4.42
Perfect documentation 4.5
Recovery camps 4.33
Staff involvement 4.63
SARFAESI Act 3.66
Lok Adalats 3
Debt Recovery Tribunals 2
Source: Questionnaire
ANALYSIS:
We can observe that staff involvement is the most effective measure taken by the bank to
reduce NPA level with a weighted average of 4.63, perfect documentation is another effective
measure with a weighted average of 4.5 and followed by others like constant dialogue with
borrowers and Recovery camps with weighted average of 4.42 and 4.33 respectively.
INFERENCE:
It can be observed that staff involvement is the most effective measure taken by the bank to
reduce the NPA level in the Bank.
G ra p h 5 .8 s h o w in g e ffe c tiv e m e a s u re s to re d u c e th e N P A s
3 2 W e ig h t e d A ve ra g e
2
1
0
Recovery
involvement
Staff
Lok
Debt
camps
Recovery
Adalats
Tribunals
documentation
Perfect
SARFAESI Act
dialog with the
Constant
borrowers
M e a su re s
57
Source: Questionnaire
Table 5.9 Showing NPAs converted into good assets
Source: Questionnaire
ANALYSIS:
From the above table, it can be interpreted that 40% of NPA have been converted into good
assets to the extent of 5% or more.
58
INFERENCE:
The Bank is controlling the level of NPA and converting the NPAs into good assets by
effective implementation of NPA reduction techniques.
50
40
40
Percentage
30
20 20 Percentage
20
10 10
10
0
0
1% 2% 3% 4% 5% >5%
Percentage of NPAs converted
into Good Assets
Source: Questionnaire
Table 5.10 Showing the extent to which profits are affected by NPA
ANALYSIS:
59
We can observe that 40% of respondents have told that profitability is affected to the extent
of 0-5% due to NPA and other 30% respondents think that profitability is affected to the
extent of 5-10% while other 20% of respondents think that profitability is affected to the
extent of 10-20% and the remaining 10% of respondents think that profitability is affected to
the extent of more than 20%.
INFERENCE:
It is observed that NPAs affect the profitability to a considerable extent.
45 40
40
35 30
30
Percentage
25 20 P erc entage
20
15 10
10
5
0
0-5 5-10 10-20 20 & above
P e rce ntage of profit affe cte d by N PA
Source: Questionnaire
60
Table: 5.11 Showing improvement in profitability after adopting NPA reduction
techniques.
Improved 3 30
Can’t Say 1 10
Not improved 1 10
Definitely not 0 0
improved
TOTAL 10 100
Source: Questionnaire
ANALYSIS:
In the above table, it can be interpreted that 50% of respondents say that profitability has
been improved after adopting NPA reduction Techniques & 10% of respondents say that
profitability has not been improved while the remaining 20% of respondents could not make
any decision.
INFERENCE:
The bank successfully reduced the level of NPAs by NPA reduction techniques.
61
Graph 5.11 showing improvement in
profitability after adopting NPA reduction
techniques
10
0
10
Definitely improved
50 Improved
Can’t Say
Not improved
30
Definitely not
improved
Source: Questionnaire
62
SUMMARY OF FINDINGS:
The main causes for NPA is willful default, followed by improper selection of
borrowers and then lack of supervision and follow up.
Personal loan constitutes for nearly 46.27% of the total NPA, Agri-term loan
constitutes 40.06%, vehicle loan constitutes 9.12% of the total NPA and Housing
loan constitute 4.53%.
It can be observed that 50% of respondents agree that NPA can be controlled, &
within this 40% are highly confident that NPAs can be controlled.
We can observe that majority of respondents say that staff involvement in the
processing helps to reduce the NPAs and other respondent’s feel that proper
documentation helps in reducing NPA.
In 4 branches NPA have value more than 50 lakhs and in 3 branches NPA is more
than 30 lakhs and in others more than 10 lakhs.
63
CONCLUSION:
The problem of non-performing assets has been a major issue for the banking industry. The
RBI which is the apex body for controlling the level of non-performing assets has been
giving guidelines and getting norms for the banks in order to control the incidents of defaults.
This study on management of non-performing assets with specific reference to J&K bank was
conducted, to find out the reasons for the incidence of non-performing assets and how public
sector banks managed it and its effect on performance of the bank.
The NPA of Jammu & Kashmir Bank Limited was studied and it was observed that
all branches of bank had NPA.
The study revealed that the J&K bank has been successful in controlling its level of
Non-performing assets as compared to the recent banking industry trends.
The causes for NPA in Jammu & Kashmir Bank Limited were analyzed, the extent to
which profitability has been reduced, was also analyzed.
64
RECOMMENDATIONS:
Constant interactions have to be maintained with the customers to keep track of their
loan payment.
Strict measures have to be taken while issuing or sanctioning the loan. The measures
can include verification of job and salary slips, verification of securities and the like.
The J&K bank ltd. is trying to reduce NPA through various techniques and it is
suggested that these measures have to be continued.
65
Annexure
Address:____________________________________________
Name of respondent:___________________________________
4. For which category the NPA is being observed (please mention in Rs)
66
Agri-term loan [ ] Rs…………………………....
5. Rate the following on a scale of 1-5. Rank ‘5’ being most effective and ‘1’ being least
effective.
S.No. CAUSES 5 4 3 2 1
1 Improper selection of Borrowers.
2 Deficiency in processing (sanctioning and
realizing the fund).
3 Improper appraisal of assets.
4 Lack of supervision and follow up
5 Natural calamities.
6 Willful default of the Borrowers.
6. What is the NPA encountered for each of these causes (Rs in Lakhs).
67
7. Do you think that NPA can be controlled?
8. What measures have been taken to reduce the NPA? Which measures you consider
the most effective?
Highly Effective Can’t Say No Definitely No
Effective
Constant dialogue [ ] [ ] [ ] [ ] [ ]
With the Borrowers
Recovery camps [ ] [ ] [ ] [ ] [ ]
Self involvement [ ] [ ] [ ] [ ] [ ]
SARFAESI Act [ ] [ ] [ ] [ ] [ ]
Lok Adalats [ ] [ ] [ ] [ ] [ ]
Debt Recovery [ ] [ ] [ ] [ ] [ ]
Tribunals
[ ] [ ] [ ] [ ] [ ] [ ] [ ]
68
10. To what extent the Profitability has been affected by NPA
[ ] [ ] [ ] [ ]
11. Has the profitability improved after adopting NPA reduction Techniques?
Definitely Improved Can’t Say Not Improved Definitely Not Improved
Improved
[ ] [ ] [ ] [ ] [ ]
69
BIBLOGRAPHY:
4.) Law and Practice of Banking by H.R. Appannaiah, P.N. Reddy and S.Vijayendra.
5.) Greater Kashmir.
6.) Hand book of banking information by N S Tour.
(B) WEBSITES
1.) www.jkbank.net
3.) www.rbi.org
70