matter

Success Story of Bank of Baroda

INTRODUCION

Maharajah of Baroda sir Sayajirao Gaikwad founded the Bank on July 20,

1908 in the princely state of Baroda, in Gujarat.

Bank of Baroda has total asset in excess of Rs. 1.78 lake Crores or Rs.

1,780bn on network of over 300 branches and offices and about 1000+ ATM’s. If

offer a wide range of banking product and financial services to corporate and retails

customer through a variety of delivery channel and through it’s specialized

subsidiaries and affiliates in the area of investment banking, credit card and asset

management.

The new logo of bank comprises dual “B” alphabets holding the sun rays. It is

referred as the Baroda sun. It’s main aim “to be a top ranking national bank of

international standard committed to augment stakeholder’s value through concern,

care and competence.

Definition:-

Section 5(b) of the banking companies act, 1949 defines a banking as “The

accepting for the purpose of lending or investment of deposit of many from the

public, repayable on demand or otherwise and withdrawal by cheque, draft or order or

otherwise.”

1


HISTORY OF BANK OF BARODA

Bank of Baroda was founded by Maharaja Sayajirao Gaikwad of Baroda on

July 20, 1908 with a paid up capital of Rs 10 lakes. Since then bank has traversed an

eventful and successful journey of almost 100 years. Today, Bank of Baroda has a

network of 2737 branches including 39 overseas branches spread over 20 countries.

In mid-eighties, the Bank of Baroda diversified into areas of merchant

banking, housing finance, credit cards and mutual funds. In 1995 the Bank raised Rs

300 corers through a Bond issue. In 1996 the Bank tapped the capital market with an

IPO of Rs 850 cores.

Bank of Baroda took the lead in shifting from manual operating systems to a

computerized work environment. Today, the Bank has 1918 computerized branches,

covering 70% of its network and 91.64% of its business.

Bank of Baroda gives high priority to quality service. In its quest for quality,

the Bank has secured the ISO 9001:2000 certifications for 15 branches. By end of the

2009-10, the Bank is targeting 54 more branches for this quality certification.

CORPORATE DETAILS

Bank of Baroda India from an organization based on private capital, princely

patronage and state ownership, at present is an epitome of enterprise and corporate

governance, situated in Mumbai. It was founded by Maharaja Sayajirao Gaekwad in

1908 in Baroda. The new logo of the bank comprises dual B alphabet, holding the sun

rays. It is referred as the Baroda Sun.

2


ACTIVITIES:

The general product and services offered by the Bank of Baroda India are:

PERSONAL

Deposits, Gen-Next Services, retail loans, credit cards, debit cards, Baroda

Health, Multi City Cheque, lockers

BUSINESS

Deposits, loans and advances, Multi City Cheque, BoB money express,

Collection services, ECS, lockers

CORPORATE

Wholesale banking, deposits, loans and advances, appraisal and erchant

banking, cash management and remittances

INTERNATIONAL

NRI services, FCNR (B) loans, offshore banking, export and import finance,

international treasury

TREASURY

Domestic and forex operations

RURAL

Deposits, priority sector advances, remittances, pension, lockers.

Along with the above facilities the Bank of Baroda India also offers some

value-added services like Baroda internet/mobile banking, Baroda OMNI, Baroda

RemitXpress and Money Transfer Service Scheme.

3


BRAND AMBASSADER

Brand Ambassador Shri Rahul Dravid and Executive Directors, Shri V.

Santhanaraman and Shri S.C. Gupta launching the new product - Baroda Gold Coin.

ORGANIZATION

Dr. M. D. Mallya is the Chairman & Managing Director of the Bank of

Baroda India.

The Bank of Baroda is the fifth largest bank in India. It has total assets in

excess of Rs. 1.78 lakh crores, or Rs. 1,780 bn., a network of over 2800 branches and

offices, and about 1000+ ATMs. Bank of Baroda offers a wide range of banking

products and financial services to corporate and retail customers through a variety of

delivery channels and through its specialized subsidiaries and affiliates in the areas of

investment banking, credit cards and asset management.

4

http://commons.wikimedia.org/w/index.php?title=Crores&action=edit&redlink=1

http://commons.wikimedia.org/w/index.php?title=Lakh&action=edit&redlink=1


OBJECTIVES

To initiate & institutionalise globally competitive HR practices in the Bank in

our pursuit to become a Bank of international standards and to become an

employer of preferred choice.

To put in place relevant HRD strategies and use modern methodologies to

undertake organizational renewal; identify and nurture talent, bring about

marked changes in the mindset of employees at all levels so as to enhance HR

Quality;

To create a performance-driven culture and an exciting workplace for the

employees

To create a pool of entrepreneurial managers and business leaders for future;

To inculcate a strong and effective sales and service culture across levels in

the organization in order to generate strong stakeholder affiliation;

To create a learning organization for employees’ intellectual growth and

creativity; and to re-skill the workforce to operate in digitally enabled modern

core banking environment.

5


HUMAN RESOURCES

Bank of Baroda has the tradition of continuous enrichment of its human asset

so that they deliver value to the business.

In the ongoing Business Transformation Programme, our PEOPLE play a vital

role and are one of the key business enablers. Under its plan of organizational

transformation through people processes and systems, the Bank has launched a few

innovative employee centric initiatives and has also undertaken revamp of key

systems and practices.

HR BUSINESS MODEL

6


7


BANK OF BARODA BRANCHES

BRANCH NETWORK (AS ON 02/08/2009)

Area No. of Branches

Metro 626

Urban 524

Semi-Urban 642

Rural 1092

Total(Indian) 2884

Foreign(Overseas) 76

Total(Global) 2960

CONTROLLING OFFICES

Zonal Offices 10

Regional Offices 43

HUMAN RESOURCES (STAFF AS OF SEPTEMBER 2006)

Officers 13525

Clerks 16497

Sub-Staff 8041

Total 38063

8


ATM / DEBIT CARD SERVICES OF BANK

No. of branches with ATMs 250

No. of networked ATMs 219

No. of VISA ATMs in India for use 15,000

2009-10 HIGHLIGHTS

+ Rs. 250,000 Croer Global Business Size

+ 24%Worldwide Business Growth

+ Rs. 1435 Crore Net Profit

+ 33 Million Global Customer Base

+ 1700 CBS Branches

9


ROLE OF BANK OF BARODA

Kinds of business that can be done : a part from the main business that is listed

down under sections 5 (b) of the act, banking companies are allowed to carry on

other form of the business that are stated in section 6 of the act. They can be classified

as follows:-

OVERVIEW

Bank of Baroda provides banking and financial services to the individual,

business, and corporate customers in India and internationally. The company offers

various deposit products, including fixed, current, and savings accounts. Its loan

portfolio comprises retail loans, credit loans, and debit cards; working capital finance,

term finance, SME Gold Card, small business, and traders loan; line of credit, bill

finance, MIBOR linked finance, sub-PLR finance, bridge loans, advance against

shares, loan against rent receivables, term finance, short term corporate loans, project

finance, and infrastructure finance; and agriculture and small scale industries loans.

Main function i.e., usual banking activities,

Subsidiary function or service.

MAIN FUNCTIONS

The banking companies are permitted to do the following main activity.

The borrowing, raising or taking of money.

The lending of money with or without security.

The granting & issuing of letters of credit of various kinds, travelers cheques

etc,

The buying, selling & dealing in bullions / species.

The buying & selling of foreign exchange including foreign currencies.

10


The acquiring, holding, issuing on commission, underwriting & dealing in

stock, funds, shares, debentures, bonds, securities & investment of all kinds.

The purchasing & selling of bonds, scripts etc., on behalf of customer or

receiving such securities for safe custody.

The providing of sale deposit vaults.

The collection & transmission of money and securities.

Above all, they are allowed to deal in the following instrument.

Bills of exchange, hundies, promissory notes, coupons, draft, bills of lading

railways receipt, warrants, debenture, certificates, script & other instrument.

SUBSIDIARY FUNCTIONS

In additional to the above main functions, thanking companies are permitted to

render the followings subsidiary services.

Acting as agents for individuals, governments etc.

Carrying on agency business of any description.

Carrying on and transactions every kind of guarantee and indemnity business.

Dealings with all or any part of the property and rights of the company.

Doing any other business notified by the central government as lawful for a

banking company.

Acquiring and undertaking the whole or any part of the business of any person

or company authorized under this sub-section.

Managing, selling and realizing any property which may.

Come into its position in satisfaction of any of its claims.

Acting as trustees for customers.

Contracting, negotiating and issuing public and private lone.

The acquisition, construction and alterations of any building if necessary and

convenient for the purposes of the company.

11


KEY DEVELOPMENT

Bank of Baroda Announces Earnings Results for the First Quarter Ended June

30, 2008

07/29/2008

Bank of Baroda announced earnings results for the first quarter ended June 30,

2008. For the quarter, the company reported net profit of INR 3,708.60 million as

compared to INR 3,308.40 million for the quarter ended June 30, 2007. Total Income

has increased from INR 30,248.00 million for the quarter ended June 30, 2007 to INR

38,063.70 million for the quarter ended June 30, 2008.

Bank of Baroda Declares Dividend for Fiscal Year 2008; Plans to Open New

Branches

07/28/2008

Bank of Baroda declared a dividend of 80% to its shareholders for the year

2007-08. The bank also announced the AGM's decision to open 190 new branches in

India and 10 more overseas branches of the bank during the current year. This would

take the total number of BOB branches to 3,000 in the domestic front and 100 in

overseas. Bank of Baroda Launches 21 New Branches and Five Retail Loan Factories

12


DIRECTOR’S OF BANK OF BARODA

Bank of Baroda announced the roll out of a bouquet of initiatives including

opening of 21 new branches and five more retail loan centers. The 21 new branches

have been set up in the urban and semi-urban centers across states including Madhya

Pradesh, Tamil Nadu, Uttar Pradesh, Gujarat and Bihar.

The bank is expanding its operations to more centers which will fuel the

overall business growth in the coming months. These apart, the bank opened ten

Baroda Grameen Paramarsh Kendras, which are counseling centers specializing in

providing assistance to farmers, small entrepreneurs and Self Help Groups (SHGs).

SERVICES OF BANK OF BARODA

13

http://www.bankofbaroda.com/pfs/fixed.asp


Wholesale Banking

SME Banking

Retail Banking

Rural Banking

Demat

WHOLESALE BANKING

Bank has identified the following new business segments as a step toward

becoming Multi Specialist Bank.

Wholesale (Large & Mid Corporates)

Urban Retail

Small & Medium Enterprises

Rural/Agri Business

Under Wholesale Banking the corporate customers are identified as Large and

Mid corporates. Companies having annual sales turnover of over Rs. 500 crore are

classified as Large Corporate and those having annual sales turnover between Rs 100

crore to 500 crore are classified as Mid Corporate.

Under Wholesale Banking it has been proposed that Large & Mid Corporate

customer of the Bank are located at the identified branches for providing them better

services. By locating the Corporates at the identified branches, they would have the

following advantages.

Single point contact to cater to all the banking requirements of the Corporates.

Expeditious decision making and shorter turnaround time.

Availability of product specialist who can customize existing products as per

the Corporate’s specific requirements & can also develop new products.

Existence of Core Banking Solution facilities & World-class infrastructure.

14


The Corporate accounts will be served at these branches by the Client Service

Team (CST) of competent credit officers.The team will comprise of

Relationship Manager

Relationship Officer

Product Specialist

Credit officer (dedicated from Corporate Office)

The following are the areas in which Client Service Team can help the Large

& Mid Corporate :

Trade Finance products

Cash Management Products

Treasury Products

Bridge Loans

Syndicated Loans

Infrastructure Loans

Cross Currency/Interest Rate Swaps

Foreign Currency Loans and many more depending upon the needs of the

Corporates.

SME BANKING

SME SHORT TERM LOANS

PURPOSE:

To meet temporary shortfall / mismatch in liquidity, for meeting genuine

business requirements only.

ENTERPRISES GROUP:

Small and Medium-sized corporates, business and Trading houses (including

partnership firms).

ELIGIBILITY CRITERIA

15


Satisfactory credit rating for the last three years

Latest Balance Sheet etc. should be available.

Satisfactory financial performance in terms of sales / turnover and profits.

Negative variance, if any, should not be more than 10%.

Satisfactory dealings with the Bank for at least five years.

LOAN AMOUNT:

Up to 25% of the existing Fund based Working capital limits (depending on

the Credit Rating), subject to a minimum of Rs. 10 Lakhs and maximum of

Rs. 250 Lakhs.

PERIOD:

Not exceeding 180 days – minimum 90 days

SECURITY

First charge / Equitable mortgage of fixed assets of the company / firm or

extension of existing first charge / equitable mortgage of fixed assets, ensuring

that there is a minimum asset cover of 1.50.

Extension of Charge on current assets for the additional facility ensuring that

adequate drawing power is available.

Extension of all existing guarantees of Directors / Third party guarantees to

cover the additional facility.

RATE OF INTEREST:

0.5% below the existing rate on working capital limits

PROCESSING CHARGES:

0.1% of the amount of loan, with a minimum of Rs. 10,000/- and maximum of

Rs. 25,000/-.

16


SME MEDIUM TERM LOANS

PURPOSE:

To augment enterprise’s working capital gap and to help in improvement of

current ratio and also for meeting genuine business requirements. The facility

will also be available for repayment of secured and unsecured Loans of other

banks or institutions, but not for any purpose, which is not related to the

enterprises activity.

ENTERPRISES GROUP:

Small and Medium-sized corporates, business and trading houses (including

partnership firms).

ELIGIBILITY CRITERIA

Satisfactory credit rating for the last three years

Latest Balance Sheet etc. should be available.

Satisfactory financial performance in terms of Sales/turnover and profits.

Negative variance, if any, should not be more than 10%.

Debt-equity ratio should not be higher than 2.5:1 and average DSCR should be

not less than 1.5:1.

Satisfactory dealings with the Bank for at least Three years.

LOAN AMOUNT:

Up to 25% of the existing fund based Working capital limits (depending on

the Credit Rating), subject to a minimum of Rs. 25 Lakhs and maximum of

Rs. 500 Lakhs.

PERIOD:

Not exceeding –36- months, to be repaid in equal quarterly or half-yearly

installments.

17


SECURITY

First charge / Equitable mortgage of fixed assets of the Company / firm or

extension of existing first charge/ equitable mortgage of fixed assets, ensuring

that there is a minimum asset cover of 1.50

RATE OF INTEREST:

0.5% - 1.0% over the Bank’s BPLR, only for the additional Loan to be granted

under the Scheme.

Prepayment penalty of 1%, if loan is prepaid within -24- months of drawdown.

PROCESSING CHARGES:

0.1% of the amount of loan, with a minimum of Rs. 25,000/- and maximum of

Rs. 50,000/-.

RETAIL BANKING

PERSONAL BANKING SERVICE

THE STRENGTH AND INTEGRITY OF RELATIONSHIPS

Bank of Baroda believes in the strength and integrity of relationships built

with its customers like you. With over 100 years of experience in the banking industry

and a wide network of over 3000 branches all over the country, we have always been

active in extending financial support and adapting to your changing needs.

18

http://www.bankofbaroda.com/branchlocator.asp


Our Deposit Products, Retail Loans, Credit Cards and Debit Cards help

you with your growing financial needs. With facilities like Lockers we ensure that

your valuables are safe with us.

Our countrywide branches offer you convenience and ease in operating your

account wherever you are. Our 24-hour ATMs enable you to withdraw cash, check

your account balance and request for a new chequebook even after banking hours.

FASTER TECHNOLOGY FOR BETTER SERVICE

Baroda Internet Banking / Baroda Mobile Banking, our latest Internet and

Mobile banking initiatives enable you to operate your account just as you would in

any of our branches. You can through the Internet check your balance, request for

cheque books and print account details. Choose from our various products and

services, that we sincerely feel will put a smile on your face; an investment we would

like to bank on forever.

RURAL BANKING SERVICES

STRENGTHENING THE RURAL ECONOMY

Rural India contributes a major chunk to the economy every year. To give this

sector a stronghold on finance and to enable economic independence, Bank of

19

http://www.bankofbaroda.com/pfs/lockers.asp

http://www.bankofbaroda.com/pfs/atm_debitcards.asp

http://www.bobcards.com/

http://www.bankofbaroda.com/pfs/retailloans.asp

http://www.bankofbaroda.com/pfs/deposits.asp


Baroda has special offerings that extend credit facilities to small and marginal

farmers, agricultural labourers and cottage industry entrepreneurs.

With the objective of developing rural economy through promotion of

agriculture, trade, commerce, industry and extending credit facilities particularly to

small and marginal farmers, agricultural labourers and small entrepreneurs, Bank of

Baroda, over the years, has reached out to larger part of rural India. We extend loans

for agricultural activities and a host of services for farmers well tuned to the rural

market, and aim to make a Self Reliant Rural India.

DEMAT

The Depository system was introduced in India more than a decade back.

Today the word "Demat" is well known and most of the investors are conversant with

the Demat of shares and securities.

Presently, there are only two depositories functioning in India and they are:-

National Securities Depository Limited (NSDL) and

Central Depository Services (India) Limited (CDSL).

Financial Institutions, banks, custodians and stockbrokers complying with the

requirements prescribed by Securities & Exchange Board of India (SEBI) can be

registered as a Depository Participant (DP).

A "Depository Participant" is an agent of the Depository (NSDL or CDSL)

who is authorized to offer depository services to investors. Thus to open a Demat

account of an investor, a bank or its branch has to get registered as a DP of a

depository i.e. NSDL or CDSL or both.

CENTRALIZATION OF DP OPERATIONS IN OUR BANK

20


The above pattern of DPs, at different branches, represents a distributed

database and operations in which each of the above DPs is separately linked to either

CDSL or NSDL. However, to have a better control & to consolidate DP operations

and make available the facility to a large number of branches, our bank, under

technology enabled Business Transformation Programme, has initiated steps to have a

centralized DP operations by migrating the above DPs and their data to a centralized

set up and link up identified CBS branches in India to this centralized set up. This

approach shall enable Bank to offer Depository services to customers across large

number of CBS branches.

PRODUCTS OF BANK OF BARODA

Deposit

Retail Loan

ATM/Debit Cards

Internet Banking

Baroda e-Trading

DEPOSITS

Bank of Baroda offers various deposit plans that you can choose from

depending on the term period, nature of deposit and its unique saving and withdrawal

features.

Apart from competitive interest rates and convenient withdrawal options, our

deposit plans offer other features such as overdraft facility, outstation cheque

collections, safe deposit lockers, ATM's etc.

Choose from Fixed, Current and Savings Deposit plans. Fixed deposits are

categorized into deposits with a term period of less than 12 months, more than 12

months and recurring deposits. These deposit plans offer convenient solutions to both

working individuals as well as senior citizens.

21

http://www.bankofbaroda.com/pfs/savings.asp

http://www.bankofbaroda.com/pfs/current.asp




Current and saving deposits are ideal for individuals who wish to take

advantage of multiple benefits within the same plan and even be eligible to opt for

overdrafts.

RETAIL LOANS

A wide range of solutions for your financial needs.

Bank of Baroda offers a wide range of retail loans to meet your diverse

needs. Whether the need is for a new house, child's education, purchase of a new car

or home appliances, our unique and need specific loans will enable you to convert

your dreams to realities.

ATM/DEBIT CARDS

22


The Bank of Baroda International Debit Card is accepted at over 32000

Visa Electron ATMs in India and 1000000 ATMs worldwide.

The card is also accepted at any 350000 merchant outlets in India and around

29 millions globally. The card enables you to enjoy the convenience of cash-less

purchasing power without the fear of overdrawing your account.

KEY BENEFITS

Take advantage of the most widely accepted card and be able to withdraw

from any ATM displaying the VISA logo, in India and abroad.

At VISA Electron merchant shops, it can also serve as your electronic purse,

and money gets debited instantly from your account, as you pay.

The Card allows you to get mini-statements from Bank of Baroda ATMs, or to

check the balance in your account, avoiding visits to even our nearest

branches.

BARODA INTERNET BANKING

23


"Baroda Connect" is an internet banking facility introduced as an alternative

delivery channel for rendering effective customer service on 24 X 7 basis. It offers

unique customized services to both Retail & Corporate customers. All customers can

register under Baroda Connect for View and / or Transaction facility

Under VIEW facility customer can

View Account summary of all operative, deposit and loan accounts

View all multiple Account information online with a single user id

Get Account statements

Under TRANSACTION facility customer can

Pay through Online Tax - Direct and Indirect taxes online such as Excise

Duty, Service Tax, Customs Duty, Income Tax etc.

Pay through Baroda Easy Pay - utility bills like electricity, mobile etc ,

Donations, Subscription, Travel plan booking online

Book Rail Ticket – IRCTC

Additionally a Corporate user can

Set up multiple workflow of initiators and approvers for transactions and

requests

View all trade finance related facilities availed eg. Export / Import LC, Inland/

Export Bills, Forward Contracts Bank Guarantees, Packing Credit account etc

Use upload facility for single debit-multiple credit, multiple debit-multiple

credit and single credit-multiple debit.

BARODA E-TRADING

Welcome to hassle free on-line investment and trading in shares

Bank of Baroda in association with India Infoline Ltd. brings forward a fast,

easy, transparent and hassle-free way for investing / trade in shares in secondary

24


capital market through National Stock Exchange and Bombay Stock Exchange.

Investment in shares traded on the NSE and BSE can be made without having to visit

your share-broker. All other associated hurdles like tracking of settlement cycles,

paying and receiving funds in savings account, paying and receiving shares in Demat

accounts have been removed.

Now from a remote location while on tour, picnic, holiday - through internet

and laptop / personal computer - you can also trade in the stock market. What's more

you have access to world class research reports, absolutely free, on trading and

investment from India Infoline.

25


How Baroda e-Trading can help you?

Baroda e-Trading is 3-in-1 integrated account. Bank of Baroda helps you to

integrate your banking, demat and trading accounts. You can trade in shares backed

by funds and securities available in your bank / demat account. Trading has been

made very easy even for beginners.

India Infoline

Baroda e-Trading, an on-line share trading in shares facility is offered under a tie-

up arrangement with M/s India Infoline Ltd. (IIL), one of the most reputed and

leading brokerage house. IIL is SEBI registered member of both the stock exchanges

NSE, BSE. They are also leading brokers in commodities market. Under Baroda e-

Trading following will be provided to you by IIL:

Investor Terminal & Trader Terminal - Trading work station that refreshes the

rates on its own of stocks that are of interest to you. For traders, this is a

premium service and available at a cost or minimum brokerage amount.

Multi exchange trading :Trade execution on both the exchanges, BSE & NSE.

Instant Limit - based on funds transferred to trading account

MIS - You can generate / view / print your accounts related reports and details

(contracts/bills/ledger, trade register, net position details, etc.) any time

anywhere.

26


MARKETING

The brand “Baroda” has steadily gained the mind share over the past two years

driving the Bank towards higher growth trajectory. During the last two years, the

Bank’s focus was on quality reach. Towards this, the marketing department put in

place a progressive sales structure on the one hand and had conceived and

implemented sales campaigns with specific business targets, and lead generation

programs. As a part of best practice initiatives, the endeavor has been to impact an

attitudinal change across the operational level where customer interface takes place

through consistent sales and soft skills training.

The specific product campaigns in liability and asset products have helped the

Bank achieve higher business growth. The Centenary Savings Bank Campaign

fetched Savings Bank deposit of Rs1,593 crore, while the Centenary Current Account

Campaign mobilized Rs1,098 crore. The Traders’ Loan and Retail Loans Campaigns

generated business to the tune of Rs 2,884 crore.

As the Bank stands at the threshold of its next century, marketing would

become a key growth driver. The thrust areas would be on enhancing sales, raising

brand equity through continuous market research for information. The existing sales

structure needs to be expanded.

The department is working out a strategic mass communication and events

plan for the financial year 2008-09 focused towards brand enhancement. Significant

27


initiatives in customer education are also envisaged in the coming year for our CRM

initiatives. As a result of above initiatives, the Bank has received recognitions both

nationally and internationally. The Baroda brand is ranked at Number One among

nationalized banks by Brand Finance.

The Bank moved up to 258th rank, improving by 158 positions over the

previous year in “The Banker” a magazine published from U.K. Besides these, the

Baroda brand won many industry level awards for its marketing and business

initiatives and strives to optimize its competitive edge in the banking space.

The Baroda brand positioning was entrenched in the consumer mind as

“India’s International Bank”, balancing its time tested values over its 100 years of

existence with the contemporary challenges of being market sensitive and responsive

as it marches tirelessly towards its next century.

MARKET RISK

Market risk is the risk that exposure to price movements of financial

instruments arising as a result of changes in market variables, such as interest rates,

exchange rates and other asset prices, will result in loss suffered by the Bank.

The objective of market risk management is to avoid excessive exposure of the

Bank’s earnings and equity to loss and to reduce the Bank’s exposure to the volatility

inherent in financial instruments such as securities, foreign exchange contracts, equity

and derivative instruments, as well as balance sheet or structural positions.

28


The primary risk that arises for the Bank as a financial intermediary is interest

rate risk due to the Bank’s Asset-liabilities management activities. Other market

related risks to which the Bank is exposed are foreign exchange risk on foreign

currency positions, liquidity, or funding risk, and price risk on trading portfolios.

The Bank has a clearly articulated integrated treasury management policy and

asset liability management policy to address market risk. These policies comprise

management practices, procedures, prudential risk limits, review mechanisms and

reporting systems.

These policies are revised periodically in line with changes in financial and

market conditions. Interest rate risk is measured through interest rate sensitivity gap

report and Earning at Risk. Further, Bank is calculating duration, modified duration,

Value at Risk for its investment portfolio consisting of fixed income securities,

equities and Forex positions on monthly basis.

The bank monitors the short term Interest rate risk by NII (Net Interest

Income) perspective and long term interest rate risk by EVE (Economic Value of

Equity) perspective. Value at Risk for the treasury positions is calculated for 10 days

holding period at 99% confidence level. Stress testing of fixed interest investment

portfolio through sensitivity analysis and equities through scenario analysis is

regularly conducted. Based on the RBI directions the bank is also estimating the

Economic value of equity impact on a quarterly basis.

29


30


SUCCESS STORY OF BANK OF BARODA

Prior to independence from the British Rule, the ancient India was ruled by

princely states, scattered over the width and breadth of the large Indian nation. The

Maharajas of the inner States of colonial India contributed to the welfare of their

respective regions as well as the Indian nation as a whole. Their vision and foresight

in founding various financial, charitable, social and philanthropic organizations

during their time is still cherished by any one going into the history of modern India

and its achievements in every walk of life. The Maharaja of Baroda, a princely state

of British India, by name Sir Sayyajirao Gaekwad III, had the same vision in

establishing a bank for servicing the public at large and the citizens of Baroda State, a

Gujarathi population in particular. On 20th July 1908, Bank of Baroda was

established under the rules of Companies Act 1897, in a small building at Baroda, by

the Maharaja with a paid up capital of Rs.10 lakhs. The guidelines set by the

Maharaja for the bank was to serve the people of the State of Baroda as well as the

neighboring regions with money lending, saving, transmission and encouraging the

development of arts, science, commerce and trade for the people.

Even during the worst financial disaster caused by the First World War, during

the period 1913 to 1917, when as many as 87 banks closed their shutters, Bank of

India survived the turbulence with its clear vision, ethical standards and financial

prudence to grow from strength to strength. There were heroes to sustain the

development of this bank to its present glory, from ordinary people as customers and

the heirs of the Royal family of Baroda.

The success story of the Bank of Baroda is studded with many a leaps and

strides it made in the International presence, apart from establishing branches all over

the Indian nation, by acquisition of already popular banking entities, as also

commencing new commercial banking establishments, in the unique Gujarathi style.

During the years of 1908 to 2007 (and the century year being round the corner) Bank

of Baroda’s growth owes to the excellence in rendering financial products and

services to the national and international population. Countries beginning from

31


America to Zambia, in the alphabetical order have been enjoying the of Baroda as of

today.

BALANCE SHEET AS ON 31st MARCH, 2005

Amount in Rupees (000's Omitted)

Schedules As on

31.3.2005

As on

31.3.2004

Capital & Liabilities

Capital 1 294,52,74 294,52,58

Reserves & Surplus 2 5333,22,71 4836,39,61

Deposits 3 81333,46,43 72967,32,38

Borrowings 4 1640,83,37 875,10,89

Other Liabilities & Provisions 5 6062,18,45 6135,30,96

Total 94664,23,70 85108,66,42

Assets

Cash and balances with Reserve Bank of

India

6 2712,32,19 3056,78,39

Balances with Banks and Money at Call

and Short Notice

7 6541,87,91 4210,02,65

Investments 8 37074,44,11 38018,81,04

Advances 9 43400,38,39 35600,88,22

Fixed Assets 10 860,80,33 815,26,86

Other Assets 11 4074,40,77 3406,89,26

Total 94664,23,70 85108,66,42

Contingent Liabilities 12 36710,37,65 30318,32,37

Bills for Collection 6200,98,31 4831,00,90

Significant Accounting Policies 17

Notes on Accounts 18

32

http://www.bankofbaroda.com/fin/fin_fy2005_notes.asp


Profit & Loss Account for the Year ended 31st March, 2005


Schedules Year ended 31st March,

2005 Year ended 31st March, 2004

I. Income

Interest Earned 13 6431,41,78 6147,06,93

Other Income 14 1304,82,78 1719,00,59

Total 7736,24,56 7866,07,52

II. Expenditure

Interest Expended 15 3452,14,60 3575,48,25

Operating Expenses 16 1982,18,61 1805,30,27

Provisions and Contingencies

1625,07,36 1518,29,41

Total 7059,40,57 6899,07,93

III. Profit

Net. Profit for the year 676,83,99 966,99,59

Add - Amount transferred from Investment Fluctuation Reserve

Nil

Nil

Available for Appropriation

676,83,99 966,99,59

AppropriationTransfer to :

a) Statutory Reserve 169,21,00 241,75,00

b) Capital Reserve - 2,50,96

c) Revenue and Other Reserves

I) Investment Fluctuation Reserve

- 475,00,00

II) General Reserve 332,39,51 26,26,91

II) Statutory Reserve (Foreign)

8,27,86 340,67,37 6,42,39 507,69,30

d) Dividend (including Dividend Tax)

I) Interim Dividend 59,94,95 99,25,08

II) Proposed Dividend 107,00,67 166,95,62 115,79,25 215,04,33

TOTAL 676,83,99 966,99,59

Basic & Diluted Earnings per Share

Rs.23.08 Rs.32.97

Significant Accounting Policies

17

33


BALANCE SHEET AS ON 31st MARCH, 2006


Schedules As on

31.3.2006

As on

31.3.2005


Capital 1 365,52,74 294,52,74


Deposits 3 93661,99,16 81333,46,43

Borrowings 4 4802,20,07 1640,83,37


Total 113392,52,73 94664,23,70

Assets


India

6 3333,43,34 2712,32,19


and Short Notice

7 10121,20,60 6541,87,91

Investments 8 35114,21,87 37074,44,11

Advances 9 59911,77,84 43400,38,39

Fixed Assets 10 920,72,69 860,80,33

Other Assets 11 3991,16,39 4074,40,77

Total 113392,52,73 94664,23,70








2006Year ended 31st March, 2005

34



I. Income

Interest Earned 13 7100,00,35 6431,41,78

Other Income 14 1191,68,50 1313,34,00

Total 8291,68,85 7744,75,78

II. Expenditure




1204,88,88 1635,97,23

Total 7464,72,88 7067,91,79

III. Profit



826,95,97 676,83,99

Appropriation

Transfer to :


b) Capital Reserve 7,61



-1042,54,43 -



6,96,58 1455,01,11 8,27,86 340,67,37


I) Interim Dividend - 59,94,95


TOTAL 826,95,97 676,83,99


Rs.27.10 Rs.23.08


17



Schedules As on 31st March, 2007 As on 31st March, 2006

I. Income

Interest Earned 13 9212,63,72 7049,95,39

Other Income 14 1173,24,10 1127,39,03

35


Total 10385,87,82 8177,34,42

II. Expenditure




1388,54,33 1090,54,45

Total 9359,41,37 7350,38,45

III. Profit



1026,46,45 826,95,97

Appropriation

Transfer to :


b) Capital Reserve 14,31,65 7,61



- -1042,54,43



57,00 503,07,35 6,96,58 412,46,68


I) Interim Dividend 124,60,65 -


TOTAL 1026,46,45 826,95,97


Rs..28.18 Rs.27.10


17


The Schedules referred to above form an integral part of the Profit & Loss Account.

Balance Sheet as on 31st March, 2008


Schedules As on

31.3.2008

As on

31.3.2007


36



Capital 1 365,52,77 365,52,76


Deposits 3 152034,12,72 124915,97,93

Borrowings 4 3927,04,80 1142,56,16


Total 179599,51,62 143146,17,46

Assets


India

6 9369,72,34 6413,52,02


and Short Notice

7 12929,56,33 11866,84,51

Investments 8 43870,06,78 34943,62,75

Advances 9 106701,32,41 83620,86,98

Fixed Assets 10 2427,00,81 1088,80,75

Other Assets 11 4301,82,95 5212,50,45

Total 179599,51,62 143146,17,46









I. Income

Interest Earned 13 11813,47,67 9004,08,55

Other Income 14 2051,03,61 1381,79,27

Total 13864,51,28 10385,87,82

II. Expenditure


37





1593,02,86 1388,54,33

Total 12428,99,13 9359,41,37

III. Profit



1435,52,15 1026,46,45

Appropriation

Transfer to :


b) Capital Reserve 84,64,85 14,31,65


651,05,38

65,503,07,35

I) General Reserve 650,35,08 502,50,35


70,30 57,00


340,93,88 252,45,84

I) Interim Dividend 0 124,60,65

II) Proposed Dividend 340,93,88 127,85,19

TOTAL 1435,52,15 1026,46,45


39.41 28.18


17


Balance Sheet as on 31st March, 2009


Schedules As on

31.3.2009

As on

31.3.2008


Capital 1 365,52,77 365,52,77

Reserves & Surplus 2 124700135 10678,39,91

Deposits 3 1923969517 152034,12,72

38


Borrowings 4 5636,08,59 3927,04,80


Total 227406,72,54 179599,51,62

Assets


India

6 10596,34,35 9369,72,34


and Short Notice

7 13490,77,35 12929,56,33

Investments 8 52445,87,58 43870,06,78

Advances 9 143985,89,61 106701,32,41

Fixed Assets 10 2309,71,93 2427,00,81

Other Assets 11 4578,11,72 4301,82,95

Total 227406,72,54 179599,51,62









I. Income

Interest Earned 13 15091,57,74 11813,47,67

Other Income 14 2757,65,80 2051,03,61

Total 17849,23,54 13864,51,28

II. Expenditure




2077,80,43 1493,02,86

39



Total 15622,03,36 12428,99,13

III. Profit



2227,20,18 1435,52,15

AppropriationTransfer to :


b) Capital Reserve 358,25,58 84,64,85


I) General Reserve 707,41,44 650,35,08

II) Special Reserve u/s 36 (1) (viii)

220,00,00 -

III) Statutory Reserve (Foreign)

1,17,48 70,30

d)Proposed Dividend (including Dividend Tax)

383,55,63 340,93,88

TOTAL 2227,20,18 1435,52,15


61.14 39.41


17


2005 2006 2007 2008 2009

SUMMARY OF PERFORMANCE

(Rs in crores)

Country 2005 2006 2007 2008 2009

40



Owned Fund 2945 3655 3055 3655 3655

Total Asset 946642 74789 828441 106783 124700

Net Profit 6768 8269 10264 14355 22272

FUTURE PLANS OF BANK OF BARODA

The Bank has drawn further ambitious plans for expansion abroad, besides

penetration in countries where it has presence to serve its 33 million global customers

still better. Other countries, where the process is under way are Canada, New Zealand,

Russia, GCC countries - Qatar, Kuwait, Saudi Arabia and Mozambique in Africa.

The Bank is also planning to upgrade/expand its existing network in countries

like China (branches-Guangzhou and Shanghai); Malaysia (Joint Venture); Kenya

(Nakuru); UAE (Fujairah) and Oman (Sohar). The Bank has plans to extend its

service area in UAE, where it is the only Indian Bank with full banking license, by

opening five Electronic Banking Service Units (EBSUs) and installation of additional

41


PRODUCTS AND SERVICES

The Bank continues to expand its vast array of international banking products

and services for meeting the needs of its global customers. These include – customer-

centric assets & liabilities products, international trade finance – buyers/ suppliers

credit, treasury products, arranging funds from international markets through foreign

currency loans, syndications for large foreign currency requirements, debt instruments

like FRN/Bonds, structured/tailor-made financial solutions, payments and receipts,

remittances, merchant banking/advisory services for foreign currency convertible

bonds/ ADR/GDR, full banking services to joint ventures/ wholly-owned subsidiaries

(WOS) of Indian corporates in the countries where it operates.

The Bank launched many customer-centric initiatives during the year with a

view to enhance customer service and convenience. A retail shoppe; SME loan

factory, central processing cell were opened in UAE. Various value added services for

NRIs were launched during the year.

“RapidFunds2India” an instant remittance facility to India was extended to

US, Seychelles and Mauritius besides existing countries of UAE, Oman and UK.

Through this facility, money can be transferred instantly to over 1,700+CBS branches

of the Bank in India and for near-instant remittances to RTGS/NEFT-linked branches

of other banks in India.Steps were also taken to tie up with various Exchange Houses

in the Middle East to increase the collection points for inward remittances. Realty

sector in India has been booming. With a view provide margin money to NRIs

seeking Home Loans in India, a special product was launched in UAE & Oman.

FUTURE PLANS ON TECHNOLOGY FRONT

1,919 domestic branches will be brought on the CBS platform by September,

2009 and two overseas in New York and Brussels will be brought on the CBS

platform by December, 2009.Internet Banking will be launched in Fiji, Tanzania and

Hong Kong during the current year.During the period April –September 2009, RTGS

and NEFT will be interfaced with the Bank’s internet banking portal.

42


This will give the Bank’s customers the facility of making inter bank money

transfers without approaching the branch.AML will be implemented in India during

April–June 2009 along with two to three other overseas territories.

Three Regional Back Offices (RBOs) are expected to be operational during

the period July-December 2009. These will be at Baroda, Chennai and Jaipur. The

remaining two RBOs are planned for the first calendar quarter of 2010. The RBOs

will cater to a cluster of 350 – 400 branches for back office activities, such as, account

opening, signature scanning, cheque book issue, statement printing, FDR renewals,

TDS certificates and some part of MIS.Single integrated Global Treasury covering

India as well as the Bank’s Treasury Operations at overseas locations in Singapore,

Hong Kong, UAE, Oman, Mauritius, Bahamas and Bahrain will be completed by

December 2009.

Several other Projects like Corporate Cash Management, Online Trading and

Centralized Pension Processing Cell will also be enabled during 2009-10. The

implementation of “IT-enabled Business Transformation Project” provides “Anytime,

Anywhere and Anyhow Banking” to the Bank’s customers and an organized and

better work set up to its operational staff at branches. The Bank’s ultimate objective is

to reorient itself as a highly technology enabled Bank to emerge as a leader in the

global market place.

TECHNOLOGY UPGRADATION

43


In the year 2009-2010, the Bank embarked on an IT enabled Business

Transformation Project to reposition itself in the intensely competitive banking

environment. The Project envisaged a host of applications to be implemented in the

Bank over a five year period ending March 2011, which would help the Bank to

transform itself into a customer-centric organization and reduce the cost of its

services. To support the integrated transformation project, the Bank set up its own

state-of-art Data Centre on 10th December 2005 conforming to Uptime Institute Tier-

3 standard. The Bank also established a 1:1 replicant Disaster Recovery Site at

Hyderabad taking into account international requirements of 500 km distance and

different seismic zone.

TECHNOLOGY PROGRESS IN 2009-10

*Core Banking Solution: *Wide Area Network:

*Internet Banking:. *City Back Offices (CBOs):

*ATM Network: *RTGS/NEFT:

*Online Money Transfer Service: *Global Treasury:

*Help Desks: *IS Security:

*Other IT Initiatives: *Anti Money Laundering:

CASE STUDY

Customer Name: Bank of Baroda [New York Branch

Project Header and Details: Complete Web Solution.

Customer Contact Info

Mr. Sanjay Gokhale.

Bank of Baroda

One Park Avenue

New York, NY 10016, USA.

URL: http://www.bankofbaroda-usa.com

44


PROFILE

Bank of Baroda (BOB) New York Branch established in 1979. BOB New

York Branch provides wide range of products and services to its customers for their

international business requirements. This branch is Well-equipped to deal

International Trade Business with a focus on Indo US Trade with personal touch.

THE CHALLENGE

Bank of Baroda wanted us to register quality top-level domain name for their

New York branch and host the site on our high speed Windows server. Our team

asked to develop corporate and professional website which had good content, but was

dated and needed a nice look with easy navigation and usability. Also we need to

promote their web site in all major search engines with top ranking.

THE SOLUTION

With our extensive background, knowledge and marketing tenacity we are

capable and willing to make the Internet work for any one. Our team identified the

bank’s requirements and worked out the systematic plan to satisfy their all needs and

wants.

THE METHOD

We constantly research, examine and implement new applications as they

emerge to ensure that our clients’ web sites are both cutting-edge and effective.

CGS’s most significant contribution to the web site is the easy-to-use information

pages. We created quality informative web pages, attractive layout with easy

navigation system, which could promote web site quickly and generate maximum

traffic.

RESULT

45


We designed a clean and professional web site, which was sensitive to their

status, history and image, while incorporating a modern approach. Stringent security,

sensitivity to needs and respect for the nature of the client were paramount. Web site

is now listed and getting higher ranking in all the major search engines.

46


QUESTIONNAIRES

1. What type of facilities provides your bank?

2. What are the product and services offered by bank?

3. Various types of accounts, number of department-a regular

function in

details.

4. Latest technology adopted by bank recently.

5. What is payment core solution?

6. What is money multiplier facility?

7. What are the electronic services provided by the bank to your

customers?

8. What are the present services in demand?

9. Is customer a service is an instrument creates sense of

competition

among banks?

10. What do you think of future of bank of Baroda?

47


CONCLUSION

The banking scenario has changed drastically. The changes which have taken

place in the last ten years are more than the changes took place in last fifty years

because of the institutionalization, liberalization, globalization and automation in the

banking industry. Bank of Baroda banking system has several outstanding

achievements to its credit, the most striking of which is its reach. Bank is now spread

out into the remote corners of our country.

Today bank is marked by high customer expectations and technological

innovations. Technology is playing a crucial role in the day to day functioning of the

bank. Baroda banks that have harnessed and leveraged technology best have a

strategic advantage. To face competition it is necessary for banks to absorb the

technology and upgrade their services.

In today’s context bank are following the strategy of “relationship banking”

than “mass banking” which is need of the hour. The customer services are playing a

very significant role in banking business. In India major events leading to

deregulation, liberalization and privatization have unleashed forces of competition,

making the bank run for their business, not only to create the customer, but more

difficult to run for their business, not only to create the customer, but more difficult to

retain the customer. Prompt and efficient customer service, thus, has become very

significant

.

48


BIBLOGRAPHY

BIBLIOGRAPHY AND REFERENCES

PRIMARY DATA

MR. D.W. BAGUL, SENIOR MANAGER (BANK OF BARODA)

BOOKS

BANKING AND FINANCIAL SYSTEM:-BY-MITHANI GORDON

INDIAN BANKING:- BY-S.NATRAJAN

WEBSITES

www.bankofbaroda.com

www.bankofbarodausa.com

www.wikipidia.com

NEWSPAPER

ECONIMICS TIMES

BUISNESS STANDARD

SEARCH ENGINES

Www.google.com

www.yahoo.com

www.answer.com

49

http://WWW.ANSWER.COM/

http://WWW.YAHOO.COM/

http://WWW.GOOGLE.COM/

http://WWW.WIKIPIDIA.COM/

http://WWW.BANKOFBARODAUSA.COM/

http://WWW.BANKOFBARODA.COM/

matter

Documents

baroda history of bank

largest bank

baroda remitxpress

baroda health

baroda omni

baroda activities

baroda objectives

barodabank of baroda