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Functioning of the Treasury Department:

During the year total Investment increased from Rs.2154.2 Crore as on

31.03.2010 to Rs. 2469.21 Crore as on 31.03.2011 and Average investment

increased from Rs.2175 Crore in 2009-10 to Rs. 219 Crore in 2010-11.During theyear bond market was negative due to high inflation and Reserve Bank of India’s

action of increasing interest rates. To control inflation RBI increased Cash Reserve

Ratio once by 25bps and Repo/Reserve rates on seven occasions by 175 bps and

225 bps respectively.The Government security yield curve flattened due to tight

liquidity conditions.The one year Government yield moved up almost 250 bps

due to increase to overnight Repo/Reverse Repo Rates. The 5 year Government

security yield moved upwards by around 70bps. 10 year benchmark Government

security yield moved up from 7.5% as on 31st March,2010 to 7.98% on 31st March,2011.Treasury Department earned Gross interest income of Rs.174.63

Crore.Loss on sale of investment amounted to Rs.7.03 Crore.Further due to

upward shift in yield curve,additional mark-to-market provision of Rs.5.27 Crore

was required to be made at the end of the year.After considering the loss on

sale,mark to market provision and amortization of premium amounting to

Rs.1.9+9 Crore, the net income of Treasury Department amounted to Rs.160.34

Crore,resulting in 7.30% net return on average investments.The newly started

Foreign Exchange Treasury earned exchange income of Rs.1.90 crore.

Functioning of Forex Department :

Your bank has registered a growth of 83% in the total foregian exchange

turnover compared to the previous year.Your bank is presently having tie-up with

M/s, “UAE Exchange and Fianancial Services Ltd. For handling Global Money

Transfer Sevices,”Xpressmoney” abd “Money Gram” under Money TransferService Scheme (MTSS) of Reserve Bank of India.Similar arrangement with

M/s.Weizman Forex Ltd. For their product Western Union Money Transfer is

being finanlized.Necessary permission from the Reserve Bank of India has been

obtained. This facility will offer one more window for Money Transfer services.

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Considering the present satisfactory volume and the future potential of forex

business in the Fort area of Mumbai,it has been decided to designate our Fort

branch in Mumbai for independent handling of the forex transactins.

Functioning of the Clearing Department:

Your bank’s Mumbai clearing Department,processed on an average

12,000 numbers of Inward cheques and 12,000 numbers of outward cheques

daily during the current financial year.Your bank has arrangement with

HDFC/ICICI Banks for issuing upcountry cheques spread all over India. Your bank

his partivipating in “Speed Clearing” introduced by RBI ,where outstation cheques

are being cleared in local clearing reducing the time taken for realization of 

outstation cheques.