.

Directors Report 2013-14

Dear Members,
The Board of Directors is pleased to present the
Twelfth Annual Report of the Bank together with the
Audited Statement of Accounts, Auditor's Report and
the report on business and operations of the Bank for
the financial year ended 31st March 2014.
PERFORMANCE HIGHLIGHTS:
Particulars
Share Capital
Total Number of Share
member

2012-2013

2013-2014

2775.46

2784.52

0.33%

9687

35.54%

7147

Change(%)

Total Investments

12711.94

13561.52

6.68%

Total Deposits

16543.54

19230.19

16.24%

Daily Deposits

509.56

1004.10

97.05%

Total Advances

3301.18

4664.00

41.28%

Interset Income

1461.68

1796.86

22.93%

22307.04

23838.92

6.87%

Total Assets/Liabilities

PROFITABILITY:
The Bank continued to deliver a steady growth in
both business and earnings, in the midst of
staggering economic growth. The deposits of the
Bank have increased substantially showing a growth
of 16.24% and the Daily Deposits almost doubled
since last year. Despite a challenging year marked by
slow growth, persistent inflation, currency volatility
and high interest rates we managed a profit of at
`46.47 Lacs for the Financial Year 2013-2014.
Operating Incomes have increased by 23.01% while
the non operating income has shown a considerable
increase to `165.38 Lacs.
DEPOSITS:
The total deposits of the Bank for the Financial Year
2013-2014 stands at `19230.19 Lacs which is up by
16.24% compared to last year. The success of the

daily deposit scheme is reflected in its manifold

increase from 509.56 lacs to 1004.10 lacs registering
a decent growth of 97.05% CASA deposits out of the
total deposits amounts to `8702.41 Lacs. The
Deposits of the bank were covered under the DICGC
insurance cover, thereby protecting depositor
interest. With the various deposit schemes designed
to meet the customer desires and the attractive
interest rates offered on the same, it is expected
that deposits shall grow significantly in the ensuing
year.
ADVANCES:
The advances stands at `4664.00 Lacs which is rise
of over 16% from last fiscal year. The bank continued
its focus on the small loans particularly its flagship
scheme of HCBL-BPL loans to customers coming
from weaker sections of the society. BPL loans saw a
rise of over 119% and amounts to `11.31 Lacs as on
31st March 2014. The improvement in CD Ratio of
the bank continued and has shown a healthy
increase and stands at 24.25% compared to the last
year's 19.95%. The credit policy of the bank is based
on the best practices in the industry with explicit
rules and guidelines for processing, appraising and
sanctioning of loans and advances. Besides, the
Bank has a wide range of Loan schemes to cater to
the credit needs of all sections of the society.

Advances
5000
4500
4000
3500
3000
2500
2000
1500
1000
500
0

Advances (in lacs)

2012-13

2013-14

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12 ANNUAL REPORT -2013-2014

SHARE CAPITAL:
The share capital of the Bank stands at `2784.51
Lacs as on 31st March 2014. The share membership
of the Bank has increased from 7147 members to
9687 members as on 31.03.2014. The total nominal
members of the Bank were 2138 as on 31.03.2013
which have increased to 2514 as on 31.03.2014.
INVESTMENTS:
The Bank ensures adequate liquidity position before
deploying funds so that liquidity is not adversely
affected. The Bank also fulfills the prescribed CRR
and SLR Norms from time to time. The Bank has
invested the excess money in SLR securities under
AFS category of investment. All investments are
done after an analytical study of the market and
considering the ALM Buckets. The Bank ensures that
there is no negative mismatch in the first two
buckets which shows that the liquidity of bank is
st
adequate. As on 31 March, 2014, the book value of
investments made in various Central and State
Government amounts to `13561.52 lacs which
comprises of `4772.44 lacs in Government approved
securities.
AUDITORS:
The Bank is guided by a strong policy framework
with robust internal control guidelines and a
supervisory system to overview the day to day
functioning of the operations. A well informed
Internal Audit team comprising of vigilant officers
supervises the daily functioning at the Branch level
and the Head Office. The Bank has also appointed
various Concurrent Auditors for various Branches
and Information System Auditor in tune with the RBI
Guidelines. The External auditors alongwith the
Internal auditors ensure a stringent compliance of
Bank policies and guidelines.

STATUTORY COMPLIANCE:
The Board of Directors informed the members that
during the Financial Year 2013-2014, the Bank
complied with all the Statutory provisions and all the
prescribed monthly, quarterly and yearly returns
were submitted to the Reserve Bank of India and the
Registrar of Co-operative Societies without delay.
The Bank has also adopted the various XBRL format
of reporting as prescribed by RBI for filing of the
monthly, quarterly and annual returns. There was no
violation of any statutory or regulatory compliance
prescribed by Reserve Bank of India.
Based on norms of Audit Classification of Primary
(Urban) Co-operative Bank HCBL Co-operative
Bank Limited is awarded as grade A for the
Financial Year 2013-2014.
BOARD OF DIRECTORS:
The Board of Directors of the Bank is a fine blend of
professionals in different fields of accounting, law,
finance, banking and insurance. The various
decisions and policies implemented in the Bank are
subject to the various rounds of discussion and
analytical study by the Directors, who lend their rich
experience and expertise, in the best interest of the
Bank. Presently, the Board is headed by Shri Anil
Vikram Singh as the Chairman and Shri Ram Sudhar as
the Vice Chairman. There are 12 elected Directors
and two co-opted directors having remarkable
professional experience and expertise.
S.No.

Name of Director

Shri Anil Vikram Singh

Shri Ram Sudhar

Shri Nand Lal

Shri Sadhu Saran

Qualifications and Experience

Remarks

Diploma in Mechanical Engineering

with many years of experience in
different industries
M.Com, CAIIB, Diploma in Business &
Finance. Worked in various capacities
in Reserve Bank of India since 1972 to
November 2008. Served as DGM in
charge of Urban Banks Department of
RBI, Lucknow. Provides consultancy
services to various UCBs in U.P &
Uttarakhand
B.A, M.A, B.Ed, LLB. 25 Years of
experince in Legal profession.

Professional
Director
(Banking)

Professional
Director (Legal)

LLB, Post Graduate in Mass Communication Professional

and Journalism. 20 years experience in Director (Legal)
Law and Journalism.

S.No.

Name of Director

Qualifications and Experience

Smt.Putul Dey

M.A and many years of experience as

a Teacher

Smt.Mithlesh Khare

B.A., Housewife

Shri.Pushkal Singh

Smt.Madhuri Johri

M.A ,Housewife

Smt.Chandana
Chatterjee

B.Sc. Many years of experience as

Teacher in Govt. school

10

Smt.Vandana Mehrotra

M.Com, B.Ed. Worked as Teacher

Remarks

Diploma in Mechanical Engineering.

Served in UPPCL as Junior Engineer
for 28 years.

Professional
Director
(Finance
and Insurance)

11

Dr.(Smt.)Pratibha
Thukral

Ph.D (Physics), Gold Medalist in Post

Graduate, Associate of Insurance
Institute of India (A.I.I). Past Experience:
Was associated with 'United India
Insurance Co. Ltd.' with last posting as
Divisional Manager. Has vast experience
of 25 years in the Insurance sector.
Presently working as administrator of
Sanjeevani Hospital and is actively
associated with Social Welfare programs
for rehabilitation of mentally challenged
children

12

Smt. Leela Singh

Graduate, Social Worker

13

Shri.K.C.Misra

M.A, CAIIB. Worked for 36 years as officer Professional

in RBI and retired as General Manager Co-opted
from RBI. He is a noted educationist and Director
is presently associated with the College
of Agriculture -RBI, Pune.

As prescribed in the By Laws of the Bank, the

meetings of the Board of Directors are held every
month to discuss key issues, policies and working of
the Bank. Besides this, the Board has also delegated
various functions and powers to different
Committees for the smooth functioning of the day to
day operations of the Bank. The main Committees
formed by the Board are:
n
The Executive Committee overviews the credit
functions of the Bank, sanctioning of loans and
advances which are subject to Board power,
approval of membership, allotment of shares,
transfer & refund of shares and investor
grievance matters.
n
The Audit Committee monitors the
implementation of Bank's system and procedures
and validates the credibility & correctness of the
Bank's financial statements and working.
n
The Investment & Risk management Committee
reviews the market risks, liquidity position,
money market trends, treasury management
aspects and guides the management to take

strategic decisions regarding investments so as to

earn better returns on the funds.
n
The ALCO (Asset Liability Management)
Committee is there to evaluate, monitor and
approve practices relating to risk due to
imbalances in capital structure. The Committee
oversees ALM functions including fixation of
interest rates for various components of assets
and liabilities, its composition, maturity and
duration.
n
The Human Resource Committee which reviews
the role of HR in handling manpower, analysing
vacancies, conducting interviews for new
openings, selecting the right candidates for the
right poistion, handling employee grievances and
also conduting exit interviews to get vital
feedback.
n
Customer Grievance Handling Committee to
handle customer grievances related to customer
services, accesibility to banking facilities etc.
MANPOWER RESOURCES:
Empowering human assets with best professional
knowhow skills and a pleasant working environment
has always being the priority of the management.
The Bank has framed its HR Policy keeping in view
its youthful workforce, filled with vital energy and
future aspirations. We aim to channelise this
youthful energy and bring productive results for the
Bank.
st

As on 31 March, 2014 the Bank had a vibrant

workforce of 127 employees dedicated to the
achievement of Bank's Vision and Mission.
HCBL BANK. CHALLENGING OUR LIMITS:
Working in a conservative Co-operative
environment, where Co-operative Banks are looked
upon with ambiguity and contempt, it is indeed a
challenge to overcome all regulatory and statutory
hurdles and deliver the results aimed at. However,

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12 ANNUAL REPORT -2013-2014

over these twelve years, we have faced every

challenge upfront and used it as a stepping stone for
a brighter tomorrow. Our regulatory and statutory
limits have never stopped us and we find new
solutions to the challenges thrown at us.
Coping with our limits and with the valuable
patronage of our esteemed customers and the high
spirits of of our workforce, we aim to overcome all
limits and surge ahead for boundless success.
PERFORMANCE THROUGH SERVICE, TECHNOLOGY
& INFRASTRUCTURE:
HCBL Co-operative Bank always believes in serving
through quality services. Customer Service,
Infrastructural facilities and Technological
innovations in banking are the cornerstone of our
Customer Service policy.
Driven by these driving forces, your Bank indeed
stands out as the Khaas Bank amongst its
contemporaries.
SERVICES:
n
E-Lobby: Following the lines of one roof banking
solution, all branches have one E-Lobby where
customers can avail banking facilities 24x7. Elobby is equipped with modern machines like
ATM, Coin Dispensor, Intranet Kiosk, Loan
Information Kiosk, MEGA BANKER etc. Now our
customers can avail facilities like Cash deposit,
Cheque deposit, Pass Book printing and
Statement printing at the click of a button
through our MEGA BANKER.
n
Banking Mall: Our Bank has not only restricted its
services to core banking but has widened its
canopy of services and is providing complete
banking solution to its customers in the form of
Insurance services, Mutual Fund selling, Pan
Allotment, NSC /KVP , Portfolio Management and
Tax Consultancy, all under one roof-in the form of
Banking Mall.
n
Banc Assurance: Our Bank has entered into tie-

ups with SBI-Life Insurance & Bharti Axa General

Insurance and provides a wide range of their
products. Thus, we aim at providing all the
financial solutions to our customers under one
roof. The Third Party Business Model of our Bank
has been very helpful to our Bank in earning extra
revenue.
n
Any Branch Banking: Because of the Core
Banking Solution, our customers can avail
banking facilities from any branch of the bank
irrespective of the branch in which they hold
their base account.
n
SMS Banking facility : Customers can avail our
SMS Banking facility wherein they can know their
account balances through a simple SMS.
Customers can know their last three transactions,
account balances and send request for cheque
book by sending a simple SMS to our helpdesk no.
9839007777.
n
Access to other Bank ATMs: Our Bank provides its
customers accessibility to the ATMs of all major
public sector, private sector and co-operative
banks of the country. Similarly, other Bank's
customers can also withdraw from our ATMs using
their ATM Cards.
n
Discount Bonanza: Now, our customer can also
avail discount at various shops, hospitals,
restaurants, parlours, medical stores etc. by
showing our bank's ATM Card on purchase.
n
Daily Deposit Scheme: For promoting Financial
Inclusion and for generating the habit of saving
amongst lower segment of society, our authorised
agents collect small savings under our scheme
named HCBL ASHA Pigmy deposit scheme using a
biometric hand held device that generate an
automatic receipt on collection.
TECHNOLOGY:
Advance Data Centre: Our Data Centre is
n
equipped with the latest Blade Server Technology
provided by IBM, which provides us the power to

.
manage our banking services, it has in-built
capability of clustering of disk and single point of
control for management of various servers
running in the single chassis. There are various
services controlled by our Data Centre like
Banking application software, ATM applications,
SMS Services, Intranet Banking application etc.
There are various in-house services that are also
running and managed by our data centre to
facilitate the employees of our bank like E-Mail
services which are managed by e-mail server and
personalized data storage facility which is
managed by file server. We are also managing web
server for running our website with our in-house
data centre through Domain Name Server (DNS).
For better security of our bank's network we are
also managing our own Anti-virus Server in the
Data Center. Our Data Center is equipped with
latest networking equipments which is powered
by CISCO. There are various Switches, Routers
and Firewalls which are fully configured and
provide us robust network, so that we are able to
provide better network access to our end users.
n
Innovative Machines: The bank is equipped with
the modern machines based on the modern
technology. The best example is our E-Lobby
which consists of Automated Teller Machines,
MEGA BANKER Machine which is a comprehensive
machine comprising of the Cash collection
machine, Cheque depositor machine, Pass Book
printing and statement printing machines.
Besides, the Bank also uses other machines like
Coin Dispensers, to meet the needs of coins of
customers, cheque deposit machines and pass
book printing machines. A note sorter machine of
the highest make and composition is also used by
the Bank for sorting currency notes.
n
Use of technology for security: As far as security
is concerned, the bank has never compromised

with our security systems. The Bank uses high

quality close circuit cameras and security
arrangements like smoke detectors, burglar
alarms, fire alarms etc. to ensure the
maintenance of high standards of security in all
its set ups.
INFRASTRUCTURE:
n
State of the art infrastructure: State of the art
infrastructure with premium quality interiors and
exteriors is an outstanding feature of all our set
ups. For serving the customers with a
comfortable and appealing ambience, all
branches are designed with the latest interiors
and furnished with the most premium quality
layouts. All branches are of international feel and
are fully air conditioned.
n
Priority Lounge : .To make our high net worth
customers & senior citizens feel privileged, all
our branches have Priority Lounge where they
can sit and avail the banking facilities in more
comfortable way.
n
Kids Corner: All branches have a kids corner
where kids can enjoy the rockers and swing while
the parents are engaged in banking with us.
SEMINARS/MEETINGS:
Knowledge updation and acquiring new skills are the
vital requirements for enhancing staff quality and
preparing them to work in a challenging banking
scenario. The Bank regularly organises training
programmes and Seminars for employees, offering
specific trainings to staff members dealing with a
particular job position. Special Know your Note
classes are organised for cashiers to professionally
equip them to handle cash and other challenges
associated with the job position. Similarly classes on
Investment and risk management is specially
organised for the Treasury department to help them
have a better understanding of the markets.

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12 ANNUAL REPORT -2013-2014

IN HOUSE TRAINING PROGRAMMES:

S.NO
1

NAME OF TOPIC

FACULTY NAME

Know Your Notes and upkeep of Cash vaults

Mr. Ravi Singh- M.Com

Basic Record Keeping, File Numbering and

upkeep of security stationary, stock creation

Mr. Pramod Kumar SinghMBA, JAIIB

Charter of Guidelines for Branch

Operations

Ms. Molly Swaroop- FCS, CAIIB,

M.Com

Issues related to Cheque Books and issue

of duplicate cheque books.

Mr. Sharat Kumar Arora- Retd.

Banker from Allahabad Bank

Nomination Guidelines

Ms. Molly Swaroop- FCS, CAIIB,

M.Com

In consensus with Banks Charter of Guidelines for Branch Operations

Features and Importance of CTS Cheque books Mr.Pramod Kumar SinghMBA, JAIIB
Business Communication skills and business
Mr. Ram Sudhar- M.Com, CAIIB
skills
Diploma in Business & Finance
(Retd.Banker from RBI)

Accounting Entries

Mr.Pradeep Shukla- CAIIB, AMFI

Basics of Treasury Management

Mr.Pradeep Shukla- CAIIB, AMFI

10

Legal aspects affecting Urban Co-operative

Banks

Mr.Himanshu Srivastava- M.Com,

MBA
Mr. Chetan Saxena- LLB

11

Ratio Analysis

Mr.Mohit Kapoor- CA

12

Basics of Taxation

Mr. Pradeep Kumar Shukla- CAIIB,

AMFI

13

Fake Note Detection

Mrs. Prachi.A.Mishra- MBA

FINANCIAL INCLUSIONTOUCHING LIVES OF THE

UNBANKED:
In tune with the ambitious flagship programme of
Reserve Bank of India to promote Financial
Inclusion, our Bank is also contributing its share of
touching thousands of households in its area of
operation and bringing it under the canopy of
organised banking sector. The Bank has designed
various schemes and policies to promote its concept
of Social Inclusion before Financial Inclusion.
Over the past three years, the Bank is seamlessly
promoting the dual ideas of Social Inclusion and
Financial Inclusion, through various efforts like
adoption of villages, organising of health camps,
free medicine distribution camps, organising of
vocational training classes etc,. in the rural
unbanked areas. To tap the urban unbanked areas,
we are committed to provide finance to the chikan
karigars and zardoji karigars and assist them in

setting up their individual karkhanas. The detailed

report on the efforts of the Bank in the direction of
Financial Inclusion is annexed to this report.
CSR INITIATIVES OF HCBLSERVICE BEFORE SELF:
While organisations strive hard to inflate their
profits and adopt all means to sustain the cut throat
competition, we believe that our Bank has a sincere
responsibility towards the society in which we
function and also towards the people, specially
those facing a difficult life. Corporate social
responsibility has always being a prime agenda of
the Bank and we have stood ahead to extend help,
whenever the situation demands so. This year,as the
state of Uttarakhand faced the worst calamity in
history, we at HCBL stood selflessly to provide the
best possible assistance to the people of the tragedy
struck region.
A detailed report featuring the corporate social
responsibility initiatives of the Bank is also annexed
to this report.
ACHIEVEMENTS AND ACCOLADES :
In the financial year 2013-14 the bank has won
following awards:
n
Jewels of Uttar Pradesh awarded to Shri
Pawan Kapoor, CEO of the Bank by Zee Ltd. for
the contributions made by Shri Kapoor in the
field of co-operative banking and services
especially in the state of Uttar Pradesh.
n
Banking Frontier Award-2013 for the Best
Annual Report.
n
Award of Excellence, 2013 by the National
th
Co-operative Union of India in its 16 Indian Cooperative Congress Meet for Bank's contribution
towards the co-operative banking sector and
efforts to provide best quality customer services.
In the yester year the bank has also won the
following awards :
n
The Bank has soared to new heights under

.
the able leadership and guidance of its C.E.OShri Pawan Kapoor and his untiring efforts in
this direction were acknowledged by the Indian
Organisation for Commerce and Industry by
awarding him with the Indian Achievers
Award-2008.
n
The Bank has also won the Banking Frontiers
Award-2011 for Technological Innovations for
implementing the latest and most innovative
technology in its day to day Banking procedures.
n
Our Bank has been awarded the ISO
Certification ISO 9001:2008 Certification for
Quality Management System & ISO 27001:2005
Certification for Information SecurityManagement System. The certification has been
obtained from world's leading certification bodyQuality Austria.
n
Our Bank has also been awarded the
prestigious Excellence Award for Co-operative
Bank Development for the year 2012 awarded
by Global Achievers Foundation. The award is
honoured to selected people and organizations
working incessantly in the Co-operative Sector
and who have taken the lead in the contemporary
banking systems, services and quality
achievements.
n
Banking Frontiers appreciated the Banks
effort in the direction of Financial Inclusion and
the unique concepts of E-Lobby & Banking Mall by
awarding the Bank with the prestigious Best
Alternate Channel Project Award-2012 &
Best Payment Project Award-2012.
QUALITY POLICY:
HCBL Bank believes in optimum satisfaction of our
esteemed customers and contributes to the growth
of customers wealth and overall development of the
country's economy and deliver the best returns to
our shareholders. We look forward towards creating
a model co-operative bank in the country of an
international level and equipped with all the latest

information technology best of customer services

and best banking products to give optimum returns
to customers on their savings. We exercise this
responsibility through adequate training of our
employees, adherence to the regulatory and
statutory guidelines issued by our regulators,
customer service innovations, systematic internal
procedures, total commitment to meet the
customer requirements, and maintaining a cooperative culture in organisation that fosters
continuous improvement.
To qualitatively standardize the systems and
procedures implemented in the Bank, the Bank
opted for ISO Certification (ISO 9001:2008 & ISO
27001:2005), to be certified by Quality Austriaworld's leading certification body. On a stringent
review and audit of the existing standards, the Bank
has been successfully granted the ISO Certification
of ISO 9001:2008 & ISO 27001:2005.
ACKNOWLEDGEMENTS:
The Board expresses its gratitude for the support
extended by the Reserve Bank of India-specially the
Urban Banks Department, Registrar of Co-operative
Societies and other regulatory bodies for their
valuable support and guidance.
We also acknowledge the unstinted support of our
customers and shareholders and also wish to place
on record our appreciation for all staff members for
been the constant driving force behind our
successful and eventful journey of more than a
decade.
DIRECTOR'S RESPONSIBILITY STATEMENT:
The Board of Directors hereby declares and confirms
that:
i. The applicable accounting standards have been
followed in the preparation of the annual
accounts and proper explanations have been
furnished, relating to material departures.

th

12 ANNUAL REPORT -2013-2014

ii. Accounting policies have been selected, and

applied consistently and reasonably, and prudent
judgments and estimates have been made so as
to give a true and fair view of the state of affairs
of the Bank and of the Profit & Loss of the Bank
for the financial year ended 31 March 2014.
iii. Proper and sufficient care has been taken for the
maintenance of adequate accounting records, in
accordance with the prescribed provisions, for
safeguarding the assets of the Bank and for
preventing and detecting fraud and other
irregularities.
iv. The annual accounts have been prepared on a
going concern basis.
v. The Bank has in place a system to ensure
compliance of all laws applicable to the Bank.

Sd/(Anil Vikram Singh)

Chairman

Sd/(Pawan Kapoor)
Secretary