To the Members,
Introduction:
Your Directors take great pleasure in presenting the 23rd Annual Report on
the business and operations of your Bank, together with the audited accounts for the year
ended March 31, 2017.
The year under review has been extremely satisfying with your Bank witnessing an
increase in asset size, revenues and profitability. What is more, it was able to manage
the bad loans much better than the industry. The metric that best captures performance is
the domestic loan growth which stood at about 23.7 per cent against the overall banking
system loan growth of around 5 per cent. The other key performance indicators are Balance
Sheet size (up 16.6 per cent), Total Deposits (up 17.8 per cent), Net Profit (up 18.3 per
cent) and Net Interest Income (up 20.1 per cent). Cost to Income Ratio improved to 43.4
per cent. This assumes even more significance as it came in the face of demonetisation
which led to growth pangs in the third quarter.
The performance is a reflection of the following:
1) Leveraging digitization to improve customer experience, productivity and Cost to
Income Ratio
2) Consolidation of its lead over peers as India's top Digital Bank in metro, urban,
semi urban and rural markets
3) Establishing itself as India's leading rural focused bank with unmatched reach,
product range and innovation
4) Unique use of artificial intelligence and data analytics to sharpen product offering
It is also an outcome of a strong brand built on the twin engines of customer and
community centricity. As you are aware, your Bank has been Creating Sustainable
Communities' through its social initiatives which help people break out of the vicious
circle of poverty and enable them to lead a better life. In pursuance of the Board mandate
to make 1 crore families economically self-reliant, we are happy to report that 68 lakh
families at the bottom of the pyramid have already been covered. We are also proud to
state that during the year, your Bank has crossed the mandatory 2 per cent CSR spend.
Last but not the least, words cannot be enough to thank our employees who made all this
possible. Especially during demonetisation when they were faced with chaos and crises by
the day and went beyond the call of duty.
Summary of Financial Performance |
|
|
|
|
(Rs.crore) |
Particulars |
For the year ended / As on |
|
March 31, 2017 |
March 31, 2016 |
Deposits and Other Borrowings |
7,17,668.5 |
6,31,393.2 |
Advances |
5,54,568.2 |
4,64,594 |
Total Income |
81,602.5 |
70,973.2 |
Profit Before Depreciation and Tax |
22,972.2 |
19,343.8 |
Profit After Tax |
14,549.6 |
12,296.2 |
Profit Brought Forward |
23,527.7 |
18,627.8 |
Total Profit Available for Appropriation |
38,077.3 |
30,924 |
Appropriations |
|
|
Transfer to Statutory Reserve |
3,637.4 |
3,074.1 |
Transfer to General Reserve |
1,455 |
1,229.6 |
Transfer to Capital Reserve |
313.4 |
222.2 |
Transfer to / (from) Investment Reserve |
4.3 |
(8.5) |
Proposed Dividend* |
- |
2,401.8 |
Tax (including cess) on Dividend* |
- |
488.9 |
|
|
|
Dividend (including tax / cess thereon) pertaining to previous year paid during the
year, net of dividend tax credits |
(1.7) |
(11.7) |
|
|
|
Balance carried over to Balance Sheet |
32,668.9 |
23,527.6 |
*The Board of Directors, at the meeting held on April 21, 2017 has proposed a dividend
of Rs.11.00 per equity share aggregating Rs.3,392.7 crore, inclusive of tax on dividend.
The proposal is subject to the approval of shareholders at the Annual General Meeting. In
terms of revised Accounting Standard (AS) 4-Contingencies and Events Occurring after the
Balance Sheet date as notified by the Ministry of Corporate Affairs through amendments to
Companies (Accounting Standards) Amendment Rules, 2016, the Bank has not appropriated
proposed dividend from Statement of Profit and Loss for the year ended March 31, 2017.
However, the effect of the proposed dividend has been reckoned in determining capital
funds in the computation of the Capital Adequacy Ratio as on March 31, 2017.
The Bank's Total Income rose to Rs.81,602.5 crore for the year under review from
Rs.70,973.2 crore in the previous year. Its Net Profit increased by 18.3 per cent to
Rs.14,549.7 crore from Rs.12,296.2 crore. Appropriations from Net Profit have been
effected as per the table given above.
Dividend
Your Bank has a dividend policy that, inter alia, balances the objectives of
appropriately rewarding shareholders and retaining capital in order to maintain a healthy
Capital Adequacy Ratio. It has had a consistent track record of steady increase in
dividend distribution over its history with the Dividend Pay-Out Ratio ranging between 20
to 25 per cent. The dividend policy of your Bank is available on the Bank's website at the
following link:
http://www.hdfcbank.com/htdocs/common/pdf/corporate/Dividend-Distribution-Policy.pdf
Consistent with this policy and in recognition of the overall performance during the year
under review, your Directors are pleased to recommend a dividend of Rs.11 per equity share
of Rs.2 as against Rs.9.50 in the previous year. As you are aware, this dividend shall be
subject to tax to be paid by the Bank.
Ratings Instrument |
Rating |
Rating Agency |
Comments |
Fixed Deposit Programme |
CARE AAA (FD) |
CARE Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. Such instruments carry lowest credit
risk. |
|
IND Taaa |
India Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. Such instruments carry lowest credit
risk. |
Certificate of Deposits Programme |
CARE A1+ |
CARE Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. Such instruments carry lowest credit
risk. |
|
IND A1+ |
India Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
|
|
Such instruments carry lowest credit risk. |
Long Term Unsecured, Subordinated (Lower Tier 2) Bonds |
CARE AAA |
CARE Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
IND AAA |
India Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
|
|
|
|
|
|
Such instruments carry lowest credit risk. |
Tier I Perpetual Bonds |
CARE AAA |
CARE Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
|
|
Such instruments carry lowest credit risk. |
|
CRISIL AAA |
CRISIL |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
|
|
Such instruments carry lowest credit risk. |
Upper Tier 2 Bonds |
CARE AAA |
CARE Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
|
|
Such instruments carry lowest credit risk. |
|
CRISIL AAA |
CRISIL |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
|
|
Such instruments carry lowest credit risk. |
Infrastructure Bonds |
CARE AAA |
CARE Ratings |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
|
|
|
|
|
|
Such instruments carry lowest credit risk. |
|
CRISIL AAA |
CRISIL |
Instruments with this rating are considered to have very strong degree of safety
regarding timely servicing of financial obligations. |
|
|
|
|
|
|
|
Such instruments carry lowest credit risk. |
Tier I Bonds (Under Basel III) |
CARE AA+ |
CARE Ratings |
Instruments with this rating are considered to have high degree of safety regarding
timely servicing of financial obligations. Such instruments carry very low credit risk. |
|
CRISIL AA+ |
CRISIL |
Instruments with this rating are considered to have high degree of safety regarding
timely servicing of financial obligations. Such instruments carry very low credit risk. |
|
|
|
|
|
|
|
|
|
IND AA+ |
India Ratings |
Instruments with this rating are considered to have high degree of safety regarding
timely servicing of financial obligations. Such instruments carry very low credit risk. |
|
|
|
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|
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|
|
Issuance of Equity Shares
During the year under review, 3,43,59,200 equity shares were allotted to the employees
of your Bank in respect of the equity stock options exercised under the Employee Stock
Option Schemes. As on March 31, 2017, the issued, paid up and authorised capital of your
Bank stood at Rs.512,50,91,434 comprising 256,25,45,717 equity shares of Rs.2 each.
Employee Stock Options
The information pertaining to Employee Stock Options is given in ANNEXURE 1 to
this report.
Capital Adequacy Ratio
Your Bank's total Capital Adequacy Ratio (CAR) calculated in line with Basel III
capital regulations stood at 14.6 per cent as on March 31, 2017, well above the regulatory
minimum of 10.25 per cent including Capital Conservation Buffer of 1.25 per cent. Of this,
Tier I CAR was 12.8 per cent. The effect of the proposed dividend has been taken into
account in computing these ratios.
Subsidiary Companies
Your Bank has two subsidiaries, HDB Financial Services Limited (HDBFSL) and HDFC
Securities Limited (HSL). The detailed financial performance of the companies is given
below.
HDB Financial Services Limited
HDBFSL is a leading Non-Banking Financial Company that caters to segments not covered
by the Bank through a network of 1,151 branches in 22 states and 3 Union Territories.
Using both physical and digital channels, the company offers loan and asset finance
products to individuals, emerging businesses, and micro enterprises across manufacturing,
trading and services sectors. Additionally, the company provides Business Process
Outsourcing (BPO) solutions to HDFC Bank.
In the year under review, HDBFSL's Net Interest Income grew by 41 per cent to
Rs.2,037.2 crore from Rs.1,444.5 crore in the previous year. Net Profit rose 28 per cent
to Rs.684.2 crore from Rs.534.4 crore.HDBFSL is rated AAA for its long-term debt and A1+
for its short-term debt facilities by CARE & CRISIL respectively indicating the
highest degree of safety regarding timely servicing of financial obligations.
Under the scheme of amalgamation approved by the Bombay and Gujarat High Courts, two
associate companies, Atlas Documentary Facilitators Company Private Limited (ADFC) and HBL
Global Private Limited (HBL) have been amalgamated with HDBFSL with effect from December
1, 2016. The appointed date of the merger was April 1, 2014. The scheme has accordingly
been given effect to in these financial statements. HBL provided marketing and promotion
services while ADFC was in the BPO business.
In the year under review, HDBFSL raised Rs.1,099.4 crore through a rights issue. This
resulted in a higher capital base and Capital Adequacy Ratio (CAR) of 20.8 per cent, well
beyond the mandatory requirement of 15 per cent. The proceeds of this issue will be
utilised for capital expenditure, working capital and business growth. As on March 31,
2017, your Bank held 96.2 per cent stake in the company.
HDFC Securities Limited
HDFC Securities Limited (HSL) is among India's largest retail broking firms offering
its 18 lakh customers a large bouquet of services. The company had the second highest
number of active (transacting) customers among all broking houses.
In the year under review, the capital markets surged on the back of a good monsoon,
higher FII inflows, improved corporate performance and the passing of the Goods and
Services Tax Bill. This is reflected in the company's performance.
HSL's Total Income grew by 37.7 per cent to Rs.553.2 crore from Rs.401.6 crore in the
previous year. Net Profit grew by 61.9 per cent to Rs.215.9 crore from Rs.133.3 crore.
Digital channels remain a core focus with more than 20 per cent of customers
transacting through the mobile app and overall 68 per cent of customers being serviced
digitally. In line with its increased thrust on digitisation, HSL added 11 branches in the
year under review as against 12 in the previous year. As on March 31, 2017, it had 273
branches.
During the year under review, HSL won three prestigious PFRDA Awards for National
Pension Scheme (NPS), viz. Best Point of Presence (POP) All Citizen, Best POP NPS
Corporate and Best POP NPS Private Sector. It was adjudged runner up in the Best
e-Brokerage category at the Outlook Money Awards 2016.
As on March 31, 2017, your Bank held 97.9 per cent stake in HSL.
The annual reports of HDBFSL and HSL are available on the website of the Bank
(www.hdfcbank.com). Shareholders who wish to have a copy of the annual accounts and
detailed information may write to the Bank. These documents shall also be available for
inspection by shareholders at the registered offices of the Bank and its two subsidiaries.
MANAGEMENT DISCUSSION AND ANALYSIS
Macroeconomic and Industry Developments
India's economy recorded a growth rate of 7.1 per cent in terms of real Gross Domestic
Product (GDP) in 2016-17. While agriculture growth rose to 4.4 per cent in 2016-17 from
0.8 per cent in 2015-16, services sector growth declined to 7.9 per cent from 9.8 per cent
during the same period. Inflation moderated, with the average level of Consumer Price
Inflation declining to an estimated level of 4.6 per cent in 2016-17 from 4.9 per cent in
2015-16. Foreign Direct Investment inflows (FDI) increased by 12 per cent in the
AprilDecember period of 2016 over the corresponding period of the previous year.
A range of supply side measures, including prudent food stock management, appropriate
monetary policy action and subdued global commodity prices led to the decline in
inflation. Meanwhile, a close to normal monsoon, liberalisation of FDI rules and higher
government capital expenditure supported domestic economic growth in 2016-17. While the
cash-squeeze in the third quarter of the year under review had an impact on private
consumption, there has been a speedy recovery in consumer demand since then.
Going forward, weakness in private investment cycle and asset quality strain in the
banking sector could prevent a full-fledged recovery though some improvement in the growth
rate is quite likely. Risks on the external front continue to loom on account of policy
uncertainty in the US and a slew of impending elections in Europe.
The growth inflation mix should continue to remain broadly unchanged in 2017-18. Going
by the Union Budget, the focus of fiscal policy in the coming year will be the revival of
rural economy and sustained increase in capital expenditure. Besides, higher outlay on
various social sector programmes and implementation of 7th Central Pay
Commission Awards should boost consumer spending. Going forward, headline GDP growth is
likely to increase to 7.5 per cent in 2017-18 from 7.1 per cent in 2016-17.
Mission, Business Strategy and Approach to Business
Your Bank's mission is to be a World Class Indian Bank', benchmarking itself
against international standards and best practices in terms of product offerings,
technology, service levels, risk management, audit and compliance. The objective is to
continue building sound customer franchises across distinct businesses so as to be a
preferred provider of banking services for its target retail and wholesale customer
segments, and to achieve a healthy growth in profitability consistent with the Bank's risk
appetite.
Your Bank's business philosophy has been based on 5 core values: Customer Focus,
Operational Excellence, Product Leadership, People and Sustainability. Based on these
cornerstones, it is your Bank's aim to build an Indian Bank that meets the financial needs
of, and provides services of a high quality to its customers across the country. Your Bank
is committed to do this while ensuring the highest levels of ethical standards,
professional integrity, corporate governance and regulatory compliance. This is
articulated through a well-documented Code of Conduct that every employee, including
senior management, has to affirm annually that he/she will abide by.
Consistent with the mission and approach, your Bank's business strategy emphasises the
following:
Increase market share in India's expanding banking and financial services
industry
Increase geographical reach
Cross-sell broad financial product portfolio across customer base
Continue investments in technology to support digital strategy
Maintain strong asset quality through disciplined credit risk management
Maintain a low cost of funds
Financial Performance
The financial performance of your Bank during the year ended March 31, 2017 remained
healthy with Total Net Revenues (Net Interest Income plus Other Income) increasing by 18.5
per cent to Rs.45,435.7 crore from Rs.38,343.2 crore in the previous year. Revenue growth
was driven by an increase in both Net Interest Income and Other Income. Net Interest
Income grew by 20.1 per cent due to acceleration in loan growth coupled with a core Net
Interest Margin (NIM) of 4.3 per cent in the year ended March 31, 2017.
Other Income grew 14.4 per cent to Rs.12,296.5 crore. The largest component was fees
and commissions, which increased by 13.6 per cent to Rs.8,812 crore. Foreign exchange and
derivatives revenue was Rs.1,263.4 crore, gain on revaluation and sale of investments was
Rs.1,139.4 crore and recoveries from written-off accounts was Rs.864.3 crore in the year
under review.
Operating (Non-Interest) Expenses increased to Rs.19,703.3 crore from Rs.16,979.7
crore. During the year under review, your Bank opened 195 new branches and 260 ATMs. This,
along with strong growth in retail asset and card products resulted in higher
infrastructure and staffing expenses. Staff expenses also increased on account of annual
wage revisions. Despite the addition to the infrastructure, your Bank's Cost to Income
Ratio improved to 43.4 per cent.
Total Provisions & Contingencies was Rs.3,593.3 crore as compared to Rs.2,725.6
crore. Your Bank's provisioning policies remain more stringent than regulatory
requirements. The Coverage Ratio based on specific provisions alone excluding write-offs
stood at around 69 per cent and including general and floating provisions around 130 per
cent as on March 31, 2017. Your Bank made General Provisions of Rs.392.2 crore during the
year.
In the year under review, your Bank's Profit Before Tax grew by 18.8 per cent to
Rs.22,139.1 crore. After providing for Income Tax of Rs.7,589.4 crore, the Net Profit
increased by 18.3 per cent to Rs.14,549.7 crore from Rs.12,296.2 crore. Return on Average
Net Worth was 18 per cent while the Basic Earnings Per Share was Rs.57.2 up from Rs.48.8.
CUSTOMER As on March 31, 2017, your Bank's Total Balance Sheet stood at Rs.8,63,840
crore, an increase of 16.6 per cent over Rs.7,40,796 crore on March 31, 2016. Total
Deposits increased by 17.8 per cent toDIGITALI Rs.6,43,640 crore from Rs.5,46,424 crore.
This was after considering maturities of about US $ 3 billion of Foreign Currency
Non-Resident (FCNR) deposits raised (and swapped
RISK into rupees with RBI at a concessional rate) during the year ended March 31, 2014.
Current Account and Savings Account (CASA) Deposit growth witnessed a spurt during the
year under review largely attributable to the demonetisation exercise.
Savings Account Deposits grew by 30.9 per cent to Rs.1,93,579 crore while Current
Account Deposits grew by 30.7 per cent to Rs.1,15,574 crore. Time Deposits stood at
Rs.3,34,487 crore representing an increase of 7.9 per cent. CASA Deposits accounted for 48
per cent of the Total Deposits as against 43 per cent earlier. Advances stood at
Rs.5,54,568 crore, an increase of 19.4 per cent. This was after considering repayments
during the year of about US $ 2 billion of overseas loans linked to FCNR deposits. The
Bank's domestic loan portfolio of Rs.5,38,642 crore grew by 23.7 per cent over March 31,
2016. The Bank had a share of 5.9 per cent in Total Domestic Deposits and 6.8 per cent in
Total Domestic Advances. Its Credit Deposit (CD) Ratio stood at 86 per cent on March 31,
2017.
Business Segments Update
Retail Banking
Your Bank follows a multi-channel strategy to reach out to its customers bringing to
them choice, convenience and a superior experience. Innovation has been the springboard of
growth in this segment. So has a strong focus on analytics and Customer Relationship
Management (CRM) which has helped the Bank know the customer better and offer tailor-made
solutions. This leads to deeper customer engagement in a cost effective manner.
The growth in your Bank's retail banking business was robust during the year under
review. Total Retail Deposits grew by 17.7 per cent to Rs.5,06,843 crore on the back of a
higher than usual CASA which, thanks to demonetisation, grew at 32.9 per cent.
Auto Loans, Personal Loans and Credit Cards accounted for a bulk of the retail business
revenues. Your Bank is a leader in the Auto Loans segment with a strong presence in
commercial vehicle and two wheeler financing.
The Bank's Retail Advances grew by 18.9 per cent to Rs.2,95,161 crore.
During the year under review, your Bank added 195 branches taking its physical
distribution network to 4,715 branches in 2,657 cities/towns. Number of ATMs increased to
12,260 from 12,000 during the same period. The Bank grew its customer base to 4.05 crore
from 3.77 crore with a continued focus on semi-urban and rural markets that accounted for
more than 52 per cent of its branches.
In Credit Cards, the Bank's focus on existing customers continued, who accounted for
about 75 per cent of the new cards issued with the number of Point-of-Sale (PoS) terminals
crossing 4.25 lakh. What is more, the transactions on these witnessed a sharp spurt in the
third quarter due to demonetisation.
In addition to this, the Bank operates in the Home Loan business in conjunction with
HDFC Limited. As per this arrangement, the former sells loans provided by the latter
through its branches, while the latter approves and disburses it. The Bank receives
sourcing fee for these loans and has the option to purchase up to 70 per cent of the fully
disbursed loans either through the issue of mortgage backed Pass Through Certificates
(PTCs) or by a direct assignment of loans. The balance is retained by HDFC Limited. Your
Bank originated, on an average, Rs.1,500 crore of Home Loans every month in the year under
review. It also purchased loans worth Rs.13,146 crore under the Loan Assignment'
route during the year ended March 31, 2017.
Your Bank also distributes Life Insurance, General Insurance and Mutual Fund products
through its tie-ups with insurance companies and mutual fund houses. Third Party
Distribution Income contributed approximately 16 per cent of total fee income for the year
ended March 31, 2017, compared to 14 per cent in the previous year.
Wholesale Banking
Like in retail, the Wholesale Banking business logged a strong growth ending the year
under review with a loan book of about Rs.2,63,000 crore constituting 47 per cent of the
Bank's total book. It grew 20.1 per cent in the year under review catering to
institutional customers like large and emerging corporates, and SMEs. Government business
is another major contributor. The breadth of offering includes Working Capital and Term
Loans as well as Trade, Cash Management, Foreign Exchange and Investment Banking services.
Growth came primarily on the back of impeccable execution of your Bank's time-tested
strategy of offering customers a wide range of products and services, customisation and
cross selling. Dedicated Relationship Managers helped in the customisation and cross
selling process. Technology further aided to improve the customer experience. All this led
to higher share of customer wallet.
Corporate Banking, which focuses on large and well rated companies was the biggest
contributor with its asset size growing by over 20 per cent to cross Rs.1,25,000 crore in
the year under review. This growth was achieved, in an otherwise subdued credit
environment, through securing a higher share of the customer wallet, addition of new
clients, introduction of differentiated product offerings in the market place and gaining
market share from competition. It pioneered in creating products and services to match the
changing market dynamics and customer behaviour.
Emerging Corporates Group, which focuses on the mid-market segment, recorded a 34
per cent growth in asset size to cross Rs.65,000 crore on March 31, 2017. The strength of
this business lies in its diversified portfolio in terms of both industry and geography.
Its success was due to its ability to acquire a higher share of wallet from existing
clients as well as securing new ones on the strength of a strong product offering plus a
solution based approach.
The Investment Banking business cemented its prominent position in Debt Capital
Markets. A testimony to this is the Bloomberg rankings of INR Bond book runners where your
Bank was placed 2nd for two consecutive years.
In Government business, your Bank's focus on tax collections continued to gather
pace. In the year under review, the direct tax collected by your Bank was about Rs.2.16
lakh crore and indirect tax Rs.1.19 lakh crore. Apart from the several state Governments
for which your Bank has been collecting taxes/duties, the Bank has also been authorised to
collect GST. Your Bank continues to enjoy its eminent position in both Cash Management
Services (CMS) and Cash Settlement Services for major stock and commodity
exchanges in the country.
In line with the Bank's drive towards digitisation, it has further ensured a larger
conversion of cash payments into electronic ones. The Trade-on-Net' offering which
provides customers access to a host of services like Remittances, Letters of Credit and
Guarantees gained even greater acceptance.
International Operations
Your Bank currently has branches at three locations outside India. These are at
Bahrain, Hong Kong and Dubai International Finance Centre (DIFC) in Dubai. The DIFC branch
offers advisory services to High Net Worth Individuals and Corporates. Your Bank also has
Representative Offices in Abu Dhabi, Dubai and Nairobi which are engaged in promotional
and marketing activities of the Bank's brand name among the Non-Resident Indians. As on
March 31, 2017, the combined balance sheet size of overseas branches was around US $ 4
billion. Advances at these branches constituted close to 4 per cent of the Bank's gross
advances as on March 31, 2017. The total income of the overseas branches constituted over
1.2 per cent of the Bank's total income for the year.
Your Bank had mobilised US $ 3.4 billion in special FCNR (B) deposits from NRI clients
under RBI swap window in 2013. As a major portion of these deposits were for a 3-year
tenor, they came up for redemption during September-November 2016. US $ 3.02 billion of
these flowed out and US $ 355.67 million was outstanding for the year ended March 31,
2017.
Treasury
The Treasury Group is responsible for compliance with reserve requirements and
management of liquidity and interest rate risk on the Bank's balance sheet. On the foreign
exchange and derivatives front, revenues accrue from spreads on customer transactions
based on trade flows and their demonstrated hedging needs. Your Bank recorded revenues of
Rs.1,263.4 crore from foreign exchange and derivative transactions in the year under
review. These revenues were distributed across large and emerging corporates, business
banking and retail customer segments for plain vanilla foreign exchange products and
across primarily large and emerging corporate segments for derivatives. The Bank offers
Indian Rupee and foreign exchange derivative products to its customers, who use them to
hedge their market risks.
Your Bank enters into foreign exchange and derivative deals with counterparties after
it has set up appropriate counterparty credit limits based on its evaluation of the
ability of the counterparty to meet its obligations in the event of crystallisation of the
exposure. Appropriate credit covenants may be stipulated where required as trigger events
to call for collaterals or terminate a transaction and contain the risk. Where the Bank
enters into foreign currency derivative contracts not involving the Indian Rupee with its
customers, it lays them off in the inter-Bank market on a matched basis. For such foreign
currency derivatives, the Bank primarily carries the counterparty credit risk (where the
customer has crystallised payables or mark-to-market losses). The Bank also deals in
derivatives on its own account, including for the purpose of its own balance sheet risk
management.
Given the regulatory requirement of holding government securities to meet the Statutory
Liquidity Ratio (SLR) requirement, your Bank maintains a portfolio of Government
Securities. While a significant portion of these SLR securities are held in the
Held-to-Maturity' (HTM) category, some of these are held in the Available for
Sale' (AFS) category. Your Bank is also a Primary Dealer for Government Securities. As a
part of this business, as well as otherwise, the Bank holds fixed income securities in the
Held for Trading' (HFT) category.
Implementation of Indian Accounting Standards (IND-AS)
The Ministry of Corporate Affairs, in its press release dated January 18, 2016, issued
a roadmap for implementation of Indian Accounting Standards (IND-AS) for scheduled
commercial banks, insurers/insurance companies and non-banking financial companies. This
roadmap requires these institutions to prepare IND-AS based financial statements for the
accounting periods beginning from April 1, 2018 onwards with comparatives for the periods
beginning April 1, 2017 and thereafter. The Reserve Bank of India (RBI), vide its circular
dated February 11, 2016 requires all scheduled commercial banks to comply with the Indian
Accounting Standards (IND-AS) for financial statements for the periods stated above. RBI
does not permit banks to adopt IND-AS earlier than the timelines stated above. The said
guidelines also state that RBI shall issue necessary instructions/ guidance/clarifications
on the relevant aspects for implementation of IND-AS as and when required.
Your Bank has formed a steering committee comprising members from cross-functional
areas for the purpose of implementation oversight. Under the guidance of the steering
committee, the Bank has formed working groups, including external consultants, dedicated
to specific functional areas. The objective of these working groups is to undertake a
review of the diagnostic analysis of the differences between the current accounting
framework and IND-AS, review the accounting policy options provided under IND-AS 101-First
Time Adoption, determine the methodologies for each accounting treatment, finalise process
and system changes, review and update policies and incorporate in business planning any
specific action points over the transition period. In addition, the Audit Committee of the
Board of Directors oversees the progress of the IND-AS implementation process.
The Bank has undertaken a diagnostic analysis of the differences between the current
accounting framework and IND-AS, including the disclosure requirements.The Bank is
currently in the process of finalising its accounting policies under IND-AS. The Bank has
evaluated the systems requiring significant changes and identified additional system and
process requirements for implementation of IND-AS. The Bank is engaging with vendors for
technology solutions for implementation of IND-AS. The Bank undertakes training programs
for its personnel in business and support functions.
The implementation of IND-AS is expected to result in significant changes to the way
the Bank prepares and presents its financial statements. The areas that are expected to
have significant accounting impact on the application of IND-AS are summarised below: a)
Financial assets (which include advances and investments) shall be classified under
amortised cost, fair value through other comprehensive income (a component of Reserves and
Surplus) or fair value through profit/loss categories on the basis of the nature of the
cash flows and the intention of holding the financial assets.
b) Interest will be recognised in the income statement using the effective interest
method, whereby the coupon, fees net of transaction costs and all other premiums or
discounts will be amortised over the life of the financial instrument.
c) Stock options will be required to be fair valued on the date of grant and be
recognised as staff expense in the income statement over the vesting period of the stock
options.
d) The impairment requirements of IND-AS 109, Financial Instruments, are based on an
Expected Credit Loss (ECL) model that replaces the incurred loss model under the extant
framework. The Bank will be generally required to recognise either a 12-Month or Lifetime
ECL, depending on whether there has been a significant increase in credit risk since
initial recognition. IND-AS 109 will change the Bank's current methodology for calculating
the provision for standard assets and non-performing assets (NPAs). The Bank will be
required to apply a three-stage approach to measure ECL on financial instruments accounted
for at amortised cost or fair value through other comprehensive income. Financial assets
will migrate through the following three stages based on the changes in credit quality
since initial recognition:
Stage 1: 12 Months ECL
For exposures which have not been assessed as credit-impaired or where there has not
been a significant increase in credit risk since initial recognition, the portion of the
ECL associated with the probability of default events occurring within the next twelve
months will need to be recognised.
Stage 2: Lifetime ECL-Not Credit Impaired
For credit exposures where there has been a significant increase in credit risk since
initial recognition but are not credit-impaired, a lifetime ECL will need to be
recognised.
Stage 3: Lifetime ECL- Credit Impaired
Financial assets will be assessed as credit impaired when one or more events having a
detrimental impact on the estimated future cash flows of that asset have occurred. For
financial assets that have become credit impaired, a lifetime ECL will need to be
recognised.
Interest revenue will be recognised at the original effective interest rate applied on
the gross carrying amount for assets falling under stages 1 and 2 and on written down
amount for the assets falling under stage 3.
e) Accounting impact on the application of IND-AS at the transition date shall be
recognised in Equity (Reserves and Surplus).
Information Technology
A pioneer in digital banking among private banks in India, your Bank has a following
firsts to its credit:
Centralized Core Banking System
Enterprise data warehouse
Online real time centralised ATM switch
Debit cards
Analytical CRM system for direct marketing
Solution to check retail loan application fraud
Mobile banking app
SMS based mobile commerce
The list has only been growing. The recent ones being the 10 Second Loan' and
Digital Loan Against Securities' (Digital LAS). Technology has enabled your Bank to
improve process and system efficiencies, scale up and offer customer convenience across
the country. To address the infrastructure limitations in deep geographies, branches and
ATMs have been commissioned using both fixed line and mobile broadband telecom networks.
Bandwidth acceleration and compression technology has been implemented to improve telecom
network speeds in rural/semi urban branches. QuickBanking, a mobile app catering to the
off-line Internet has been further enhanced this year to incorporate Unified Payment
Interface (UPI) which rides on the USSD 2.0 platform of National Payments Corporation of
India and enables fund transfer to beneficiaries across banks on a 24*7 basis.
Cyber Security
Your Bank has set up an effective governance framework to manage cyber security. A
suitable organisational structure has been put in place to monitor various cyber security
threats and minimize them. In order to protect critical assets from cyber attacks, the
Cyber Security Operations Center (SoC) operates on a 24*7 basis. In the year under review,
your Bank further enhanced SoC to manage, respond and resolve cyber security incidents in
an effective/timely manner.
Further your Bank conducts:
Regular vulnerability assessments and penetration tests to assess/ remedy
vulnerabilities in applications and IT infrastructure
Anti-phishing services have been subscribed to ensure that the phishing sites
are shutdown in a timely manner and customers prevented from being lured to fraudulent
sites
Risk engine and transaction monitoring systems are implemented to monitor
suspicious transactions on Internet Banking, ATM and e-commerce channels
Humans being the weakest link in cyber security, your Bank has been carrying out
continuous awareness among employees and customers
The critical websites of the Bank are scanned and monitored continuously for
early detection of any malware
A testimony to the Bank's crisis preparedness is that it has secured PCI DSS 3.0
certification and ISO 27001 certification for its critical information assets. Its efforts
have been further recognized through awards from IDRBT, DSCI-NASSCOM for various cyber
security initiatives.
Particularly in the year under review, your Bank made significant investments in
strengthening protection against Distributed Denial of Service (DDoS) attacks and Web
Application Firewall (WAF). Various simulation exercises were carried out to learn from
techniques like ethical hacking and smoke screen & decoy testing. The Bank also
participated in IDBRT's cyber security drills to identify weak links and strengthen
defence. It will continue to invest further in the coming years in the areas of cyber
security to take it to the next level.
During the year under review, it implemented a 3-way disaster recovery solution for its
Core Banking platform. This ensured that Core Banking Systems went without any prolonged
outage. In addition, your Bank has a well-rehearsed disaster recovery set-up, so as to
ensure 99.5 per cent up-time of important applications.
Service Quality Initiatives
A regular process of reviewing the service levels and capturing feedback from customers
is undertaken for continuous improvement in product, processes and services. The
multi-channel strategy of the Bank necessitates real-time monitoring of customer
experience, securing feedback and response. This process is critical as the customer can
now access the Bank's services across traditional touchpoints like branches, ATMs as well
as the digital ones like the Internet and Mobile. Your Bank has therefore augmented the
training and skill development mechanism to empower and equip employeesTESTSS to deliver
improved quality of customer service, as well as put in place a more stringent grievance
monitoring and redressal mechanism. Mystery shopping activities using decoy customers
ENSURE THAT are also undertaken across branches and retail asset centres to
continuously evaluate regulatory compliance, process adherence and quality of service
delivery to customers. The findings are workedARER upon using Lean and Six Sigma
methodologies to bring in process improvements. The effectiveness of these measures is
reviewed periodically at different levels including the Customer Service Committee of the
Board. In addition to SECURITY__ the aforementionedYOURU measures, in compliance with
regulatory guidelines, your Bank has appointed a senior retired banker as Internal
Ombudsman.
As a result of the continued focus on customer service, your Bank has received written
appreciation from many Banking Ombudsmen appointed by Reserve Bank of India across
locations such as Andhra Pradesh, Chhattisgarh, Goa, Gujarat, Himachal Pradesh, Kerala,
Lakshadweep, Madhya Pradesh, Maharashtra, Odisha, Puducherry, Punjab, Sikkim, Tamil Nadu
and West Bengal.
Risk Management and Portfolio Quality
The Bank is exposed to risk by the very nature of its business. These can be classified
as:
Credit Risk including Residual Risks
Credit Concentration Risk
Market Risk
Business Risk
Operational Risk
Strategic Risk
Interest Rate Risk in the Banking Book
Compliance Risk
Liquidity Risk
Reputation Risk
Intraday Risk
Model Risk
Technology Risk
Counterparty Credit Risk
Outsourcing Risk
Group Risk (covering HDBFSL and HSL)
These material risks are factored in while determining the capital requirements. The
most important of these are Credit Risk, Market Risk, Liquidity Risk and Operational Risk
which are explained below. Identifying, measuring, monitoring and managing these are
critical to balancing the risk-return trade off and determining the ultimate success of
the Bank.
Your Bank has a Board approved risk strategy and policy in place. The implementation of
this well-defined policy is supervised by the Risk Policy and Monitoring Committee of the
Board. The committee periodically reviews risk level and direction, portfolio composition,
status of impaired credits as well as limits for treasury operations.
Credit Risk
The Bank has a comprehensive centralised risk management function, independent of the
operations and business units of the Bank. Distinct policies, processes and systems are in
place for the Retail and Wholesale Lending businesses. In the Retail Loan business, the
credit cycle is managed through appropriate front-end credit, operational and collection
processes. For each product, programmes defining customer segments, underwriting standards
and security structure are specified to ensure consistency of credit buying patterns.
Given the granularity of individual exposures, retail credit risk is monitored largely on
a portfolio basis, across various products and customer segments. For wholesale credit
exposures, management of credit risk is done through target market definition, appropriate
credit approval processes, ongoing post-disbursement monitoring and remedial management
procedures. Overall portfolio diversification, prudential ceilings across various
dimensions (individual/ borrower group, industry, credit risk rating grades and country),
product mix, security structures and periodic as well as proactive reviews facilitate risk
mitigation and management.
The asset quality of the Indian banking industry continued to be under severe pressure
due to macroeconomic factors as well as sector specific issues. The banking industry on an
overall basis saw a sharp increase in stress and non-performing assets. Your Bank did not
witness any significant deterioration in overall asset quality and continues to maintain
the highest standards of governance in respect of recognition and provisioning of
non-performing loans.
As on March 31, 2017, your Bank's ratio of Gross Non-Performing Assets (NPAs) to gross
advances was 1.05 per cent. Net Non-Performing Assets (Gross Non-Performing Assets less
Specific Loan Loss provisions) was 0.3 per cent of Net Advances as on March 31, 2017.
Total restructured assets (including applications under process for restructuring) was
0.06 per cent of gross advances as on March 31, 2017. As a matter of abundant caution, the
Bank provides more than regulatory requirements for its NPAs while adhering to regulatory
norms for the provision of Standard Assets.
Market Risk
This arises out of the Bank's trading portfolio and is managed through a well-defined
Board approved investment policy which caps exposures to various securities through
stringent trading risk limits/triggers. These include position limits, gap limits, tenor
restrictions, sensitivity limits viz. PV01, Modified Duration of Hold To Maturity
Portfolio and Option Greeks, Value-at-Risk (VaR) Limit, Stop Loss Trigger Level (SLTL) and
Potential Loss Trigger Level (PLTL). This is backed up further by a Board approved stress
testing policy and framework which simulates various market risk scenarios in order to
measure losses and initiate control measures.
Liquidity Risk
The framework for liquidity and interest rate risk management is established in the
Bank's Asset Liquidity-Management policy which is in line with regulatory requirements.
Your Bank has established various Board approved limits like maturity gap limits and
limits on stock ratios for liquidity risk and limits on income impact and market value
impact for interest rate risk. Your Bank's Asset Liability Committee (ALCO) is responsible
for adherence to liquidity risk and interest rate risk limits. Additionally, your Bank has
a comprehensive Board approved stress testing programme covering liquidity and interest
rate risk which is aligned with the regulatory guidelines. The Liquidity Coverage Ratio
(LCR) is a global minimum standard for Bank liquidity. The ratio aims to ensure that a
bank has an adequate stock of unencumbered High-Quality Liquid Assets (HQLA) that can be
converted into cash easily and immediately to meet its liquidity needs for a 30-day
calendar liquidity stress scenario. In June 2014, RBI released Basel III Framework on
Liquidity Standards-Liquidity Coverage Ratio (LCR), Liquidity Risk Monitoring Tools and
LCR Disclosure Standards. Based on the guidelines, LCR became effective on January 1,
2015.
The minimum requirement for the ratio was 80 per cent on January 1, 2017. This was to
increase by 10 percentage points every year to touch 100 per cent on January 1, 2019. The
Bank's average LCR was in excess of this stipulation and was 99.52 per cent on a
consolidated basis for the quarter ended March 31, 2017.
In accordance with RBI's guidelines, the Bank is currently on the Standardized Approach
for Credit as well as Market Risk and the Basic Indicator Approach for Operational Risk.
It is at the same time progressing towards migrating to an advanced approach for these
risks when permitted by the regulator. The Bank has a structured management framework in
the Internal Capital Adequacy Assessment Process (ICAAP) for the identification and
evaluation of the significance of all risks that the Bank faces, which may have a material
adverse impact on its business and financial position and the adequacy of capital to cover
these risks.
Its Board approved Stress Testing Policy and Framework entails the use of various
techniques to assess potential vulnerability to extreme but plausible stressed business
conditions. The changes in the levels of various risks and the changes in the on and off
balance sheet positions of the Bank are assessed under such assumed scenarios and
sensitivity factors which generally relate to the impact on its profitability and capital
adequacy.
Operational Risk
A Board approved Operational Risk Management Framework has been put in place which is
implemented by a dedicated team within the Risk Management function. A bottom up risk
control self-assessment process identifies high risk areas, potential gaps and serves as
an early warning system so that remedial measures can be initiated in a timely manner.
Internal Controls, Audit and Compliance
Your Bank has Internal Audit and Compliance functions which are responsible for
independently evaluating the adequacy of all internal controls and ensuring operating and
business units adhere to internal processes and procedures as well as to regulatory and
legal requirements. The audit function also proactively recommends improvements in
operational processes and service quality. To mitigate operational risks, the Bank has put
in place extensive internal controls including audit trails, appropriate segregation of
front and back office operations, post transaction monitoring processes at the back end to
ensure independent checks and balances, adherence to the laid down policies and procedures
of the Bank and to all applicable regulatory guidelines. The internal audit function also
carries out management self-assessment of adequacy of the Bank's internal financial
controls and operating effectiveness of such controls in terms of Sarbanes Oxley (SOX) Act
and Companies Act, 2013. Your Bank has always adhered to the highest standards of
compliance and governance and has put in place controls and an appropriate structure to
ensure this. To ensure independence, the internal audit function has a reporting line to
the Chairman of the Audit Committee of the Board and only a dotted line reporting to the
Managing Director. The Audit Committee of the Board also reviews the performance of the
audit and compliance functions and reviews the effectiveness of controls and compliance
with regulatory guidelines.
Corporate Social Responsibility (CSR)-Creating Sustainable Communities
Creating Sustainable Communities' is the underlying philosophy that drives your
Bank's CSR initiatives and it springs from one of its Core Values: Sustainability. The
objective is to enable families break the vicious circle of poverty and draw them into a
cycle of growth, development and empowerment without disturbing the ecological balance.
Your Bank is committed to identifying and supporting outreach programmes aimed at
developing and advancing the community in this manner. The Bank works through partnerships
with Non-Governmental Organisations (NGOs) as well as directly through its various
businesses to create social value through its products and services.
Your Bank's Holistic Rural Development Programme (HRDP) is its flagship CSR initiative.
This programme aims to improve the economic and social conditions of the villages where it
operates. The focus areas of HRDP are Promoting Education; Skills Training and Livelihood
Enhancement; Natural Resources Management; Healthcare and Hygiene; Financial Literacy and
Inclusion. Under the programme, the Bank is working in over 500 villages across 14 states
in the country.
Promoting Education
Your Bank's education programmes are structured to create a conducive and effective
learning environment in schools. This includes providing basic infrastructure, teacher
training, learning improvements, scholarships and career guidance programmes. The
programmes are spread across a wide geography and close to 900 schools are being covered.
The distinctiveness of these programmes is the focus on improving the skills of
teachers, which in turn benefits the students. More than 65,000 students have benefitted
through these programmes.
Through the Zero Investment Innovation for Educational Initiatives (ZIIEI), your Bank
has reached out to more than 5.5 lakh school teachers. ZIIEI is a unique platform to
implement best practices in education across more than 75,000 schools in Uttar Pradesh.
The project has been executed jointly with a leading NGO for the state government.
Skills Training and Livelihood Enhancement
To create a sustainable community, your Bank believes that people must have a steady
source of income which will contribute to a thriving economy. To this end, the Bank
provides skills training and development to enable beneficiaries to earn a living, with a
special focus on women and youth. Your Bank addresses this need through multiple projects
ranging from competency-based skill-oriented training and placement, capacity building,
promoting entrepreneurial activities and upskilling for agricultural and allied practices.
These initiatives are tailor-made programmes that focus on addressing the specific needs
of a community.
Nearly 16,000 individuals have benefited through the Bank's efforts in skills based
training. It has supported more than 1,100 individuals to become entrepreneurs. The
projects are spread across varied geographies from Jammu & Kashmir in the North,
Meghalaya in the North East, Tamil Nadu in the South to Gujarat in the West. One of the
projects to provide job-based skills training in Uttar Pradesh, has benefitted more than
5,000 individuals.
Natural Resource Management
While working on issues such as livelihood and water, your Bank makes a concerted
effort towards managing local natural resources. The multi-focused interventions include
the areas of soil and water conservation, water management, construction, renovation and
maintenance of water harvesting structures for improving surface and ground water
availability as well as for promoting organic fertilisers and renewable energy.
Your Bank has planted more than 67,000 trees, with the twin objectives of developing
horticulture and ensuring top soil retention for better agriculture yield. A little over
3,800 acres of agricultural land has been treated for enhanced agricultural produce. In
order to provide proper irrigation support more than 200 water harvesting structures have
been constructed or renovated. Crop diversification has been carried out in over 840 acres
for higher output as well as enriched fertility of the soil.
Healthcare & Hygiene
Your Bank promotes the cause of good hygiene and sanitation practices in the community.
Towards this end, the Bank supports construction of toilets and provision of clean
drinking water facilities. Close to 7,500 households and 900 schools in rural India have
been covered under the toilet programme so far. A primary healthcare centre was set up in
the flood affected regions of Uttarakhand, which benefited around 50,000 people.
Financial Literacy
Financial literacy is the first step towards real financial inclusion. With this
belief, the Bank conducts financial literacy workshops for communities to enable them to
make smart financial decisions and sustain themselves. These workshops are executed
through the Bank's business units as well as its NGO partners.
Dhanchayat, is the Bank's financial literacy programme on wheels and this has been
running successfully, making more and more people in the rural areas aware of the perils
of informal banking. Your Bank also disseminates information on general banking, credit
counselling and digital banking across a wider society such as schools, colleges,
pensioners and senior citizens.
Over 40 lakh households have benefited from the Bank's financial literacy drive.
Financial Inclusion
Your Bank is fully committed to digital transactions and the recent push given to it by
the Union Government. It now offers last mile access through mobile applications like
BHIM, UPI, USSD, Scan & Pay as well as Aadhaar and RuPay enabled Micro-ATMs.
In another ongoing effort to bring more of the under-banked sections of the population
into formal financial channels, your Bank has opened over 17 lakh accounts under the
Pradhan Mantri Jan Dhan Yojana (PMJDY) and enrolled over 26 lakh customers in
social security schemes since inception. It now ranks among the leading private sector
banks in this regard. Loans to the tune of Rs.5,522.5 crore were extended under the
Pradhan Mantri Mudra Yojana (PMMY) and nearly Rs.143.5 crore under the Stand Up
India' scheme to Scheduled Caste/Scheduled Tribe women borrowers in the year under review.
Environment Sustainability
Maintaining a balance between the natural capital and communities is now integral to
the Bank's functioning. Towards this end, your Bank's ATMs have gone paperless, enabling
reduction of carbon footprint. The Bank has given this effort a further fillip by ensuring
multi-channel delivery through NetBanking, PhoneBanking and MobileBanking. This reduces
carbon emission from operations as well as on account of reduced customer travel
requirements. Another source for reducing the environmental footprint is solar ATMs. These
use rechargeable Lithium Ion batteries that reduce power consumption.
Blood Donation Campaign
The year 2016 was a milestone year for the campaign for two reasons. One, it was its 10th
year. Two, it witnessed record participation in terms of cities, camps and colleges
resulting in over 1.7 lakh blood units being collected from more than 2 lakh people. The
tie up with corporate and defence establishments to organise camps at their premises also
helped in the unprecedented collection.
Sustainable Livelihood Initiative (SLI)
Your Bank's Sustainable Livelihood Initiative (SLI) is about Creating Sustainable
Communities' by empowering people, and helping them break the vicious circle of poverty.
The Bank takes immense pride in stating that through its Board mandated SLI, it has made a
difference in the lives of lakhs of women at the bottom of the pyramid by creating
long-term sustainable solutions rather than just providing short-term relief.
The basic premise of the SLI model is that empowering women means empowering families.
Women participants form Self Help Groups (SHGs) or Joint Liability Groups (JLGs) that are
nurtured by the Bank's employees. The approach under SLI covers occupational skills
training, financial literacy, credit counselling, livelihood finance and market linkage.
Today, SLI is harnessing the collective power of women's groups to make an impact in
village communities by implementing health and sanitation programmes.
Apart from the holistic approach, what makes this programme one-of-its-kind in the
world is its scale. Sample this; 8,000 dedicated bank employees working with millions of
people at the bottom of the pyramid in trying conditions driven purely by a passion to
transform lives.
The SLI programme is being accelerated further through digitisation notwithstanding
hurdles like poor awareness and telecom infrastructure. These are being overcome by using
platforms like USSD which work on feature phones. Furthermore, to facilitate card-based
transactions, the Bank has installed PoS machines in more than 200 villages.
At the end of the year under review, 68 lakh households in 25 states were covered
through this programme. These include Assam, Bihar, Chhattisgarh, Meghalaya, Madhya
Pradesh, Odisha, Rajasthan, Sikkim, Tripura, Uttar Pradesh and Uttarakhand.
The disclosures pertaining to CSR as required under Rule 8 of the Companies (Accounts)
Rules, 2014 have been given in ANNEXURE 2 to this report.
Agriculture & Allied Activities
Your Bank's credit to Agriculture & Allied activities stood at Rs.77,921 crore on
March 31, 2017 representing an increase of about 17 per cent over the March 31, 2016
figure of Rs.66,890.4 crore.
With about half of India's population living on agriculture, this is an important
business segment for the Bank. The suite of products offered include the Kisan Gold Card,
Tractor and Cattle Loans. Apart from loans directly linked to agriculture, the Bank offers
other credit products such as two-wheeler loans, car loans, loans against gold jewellery
and mortgage loans.
The Kisan Gold Card is now being offered in 60,000 villages. Your Bank has designed a
range of crop and geography specific products keeping in mind the harvest cycles and local
needs of farmers spread across diverse agro climatic zones. Credit is targeted at allied
agricultural activities like dairy, pisciculture and sericulture through specific
products.
Using technology, your Bank is able to deliver some loans within three working days in
select geographies, and loan enhancements in a few seconds through ATMs or mobile phones.
The Bank also enables faster cash flows to the farmer through products like post-harvest
Cash Credit and Warehouse Receipt Financing.
HDFC Bank's focus in the rural markets has not just been on increasing credit off-take
but also on cementing relationships with customers by empowering them. As a part of these
efforts, 11 Kisan Dhan Vikas Kendras have been rolled out across Punjab, Maharashtra,
Uttar Pradesh and Madhya Pradesh where farmers secure information on soil health, mandi
prices, various government initiatives and expert advice. These services are also
available on the Bank's website in vernacular languages. Advisories on weather, cropping
and harvesting are also shared through SMS.
Milk-to-Money (MTM)
The Bank's MTM footprint (including Micro ATMs) crossed the landmark of 1,000 in the
year under review. Approximately 3.17 lakh farmers are covered across 16 states including
Gujarat, Maharashtra, Punjab and Rajasthan. Farmers receive Direct Benefit Transfers from
the Government in the same account.
Under this initiative, Multi-function Terminals (MFTs), popularly known as
Milk-to-Money ATMs, are deployed in dairy societies. The MFTs link the milk procurement
system of the dairy society to the farmers' account to enable faster payments. MFTs have
cash dispensers that function as standard ATMs. The transparency in the milk collection
process benefits both farmers and society. Payments are credited without the difficulties
associated with the cash distribution process. What is more, this creates a credit history
which can then be used as the basis for accessing bank credit. Apart from the Dairy and
Cattle Loans, customers gain access to all bank products including digital offerings such
as
10 Second Personal Loans, Kisan Credit Card, Bill Pay and Missed Call Mobile Recharge.
Loans against Gold Jewellery
As on March 31, 2017, Loans against Gold Jewellery stood at Rs.4,800 crore as against
Rs.4,531 crore on March 31, 2016.
Banks have started making inroads in a market traditionally dominated by the
unorganised sector and pawn brokers. The entry of such players has resulted in increased
awareness, and at the same time provided greater transparency by substituting the money
lenders. The availability of the asset and the ease of securing a loan have made this a
convenient and viable credit option.
Micro, Small and Medium Enterprises (MSME)
The year under review has been a challenging but defining one for the MSME business.
Demonetisation was a temporary setback for a business whose customers traditionally
transact in cash. Your Bank was able to overcome this in the last quarter. The Bank's
advances to MSMEs grew by 14.4 per cent to touch Rs.85,166.6 crore on March 31, 2017 from
Rs.74,657.3 crore on March 31, 2016.
Demonetisation and the advent of the next-generation of entrepreneurs has seen a steady
shift towards digital transactions. In what could be a potential game changer for the
business, the Bank launched a complete online solution-the SM@Bank'. Through this,
customers can access-credit facility information, request adhoc/temporary overdraft
facilities, ask for new facilities and submit documents to the Bank for straight through
processing on a 24*7 basis. This gained significant traction in the very first year and is
now poised to gain further momentum.
Within this segment, the Bank continued its approach of targeting the manufacturing,
retailing, wholesale, trading, and services sectors.
Innovation
Your Bank has embarked on a Mobile First' digital strategy that builds on the
last two decades of investment in technology. This strategy enables your Bank to offer an
entire spectrum of banking products which can now be accessed not only on high-end smart
phones and tablets, but also on feature phones that require little or no Internet
connectivity.
As you are aware, digital innovation has been the prime driver across businesses for
the last two years. It has got further impetus with emphasis on artificial intelligence,
chatbots and machine learning enabling your Bank to offer a superior customer experience.
The Bank hosted the 2nd Digital Innovation Summit in February 2017 to tap
into the fin-tech and start-up ecosystem and harness the emerging technological trends. In
the 2nd Digital Innovation Summit, the Bank invited entries in rural fin-tech
category as well along with submissions in other categories. Five companies have been
chosen as winners, whose solutions the Bank is evaluating for potential application. These
companies are in Artificial Intelligence, Marketing, Mobile Payments, Quality Assurance
and Biometric Payments domains with special focus on solutions that will help semi-urban
and rural customers.
Some of the major digital innovations introduced in the year ended March 31, 2017 are:
Interactive Humanoid IRA': HDFC Bank now has a humanoid, IRA, which is
a technology demonstrator in the field of artificial intelligence and robotics. It can
support customer service.
HDFC Bank's Virtual Assistant EVA': An Artificial Intelligence based
customer service chatbot deployed on your Bank's website that responds to customer queries
and provides product information.
HDFC Bank OnChat: Your Bank has forayed into social media banking to reach
out to the millennial customers. At present, customers and non-customers can complete
e-commerce transactions on Facebook Messenger.
Expense Tracker: This personal financial management tool gives customers a
snapshot of their income, expenses, and investments and helps them secure control over
their finances. This enhancement in your Bank's MobileBanking app has received encouraging
customer response.
Other innovations like PayZapp, SmartBuy and the 10 second personal loan
continued to gather momentum in the year under review.
People
Your Bank believes that the key to building an organization is People. The philosophy
of the Bank can be summarised as: Hiring right talent and retaining them by creating a
conducive environment through a combination of financial and non-financial incentives.
Besides innovation, the organization also fosters a culture of empowerment and ownership.
This paid-off during demonetisation, when our employees went well beyond the call-of-duty
to make customers comfortable. In an extremely chaotic environment with crises erupting by
the day, they came up with creative solutions.
To reiterate the five broad pillars of HDFC Bank's People Strategy are:
Resourcing and Hiring: In an industry where agility in talent acquisition
and deployment is key to geographic expansion and growth, your Bank has leveraged online
recruitment along with other channels like job-ready model to develop reach and quality of
hires. It has created a strong leadership pipeline across levels by identifying the right
talent internally and grooming them for challenging roles. This has resulted in an 84,000
plus work force that is well motivated and trained to deliver value to the customer.
Increased digitisation, improved process efficiencies and rebalancing capacities over the
years has led to a small decrease in the employee base.
Career Management: Your Bank's talent management processes create
opportunities for employees to develop and grow. The systematic investment of time in
career discussion with employees, competency assessment and intensive functional as well
as behavioural training through the Gurukul programmes reiterate the Bank's commitment to
employees on career progression.
Employee Engagement: The Bank has nurtured an enabling performance culture
in line with its vision to be a `World Class Indian Bank'. The Performance Management
System aligns organization goals with key objectives for each business. Role-based
scorecards at the employee level coupled with managerial feedback provide clarity and
support to help employees excel.
In addition, your Bank strives to strengthen its connect with employees. The Bank
conducted an employee survey to understand various aspects of their experience and
followed through with appropriate interventions spanning from the local to pan-Bank level.
The Bank also conducts several employee engagement events, both at local and national
levels.
? Josh Unlimited: Pan-India Sports event conducted in 27 cities
? Stepathlon: An Employee Wellness initiative that saw the participation rise by
1,000 to about 3,500
? Hunar: Pan-India in-house talent competition
? Corporate Online Library: A knowledge resource available to all employees for
accessing nearly 1.5 lakh books
? Employees can also participate in the HDFC Bank Voice Hunt Contest' in
association with Shankar Mahadevan Academy and Corporate Photography Contest' which
is an inter-corporate event.
The Bank encourages employees to participate in community and social work. Through your
Bank's Employee Payroll Giving' programme, personnel can choose to donate a certain amount
from their salary each month towards specific social causes.
The other flagship programmes are the Blood Donation Drive and the Bank's volunteering
programme which entails employees imparting financial literacy and contributing to relief
efforts in case of natural calamities.
HDFC Bank Cares' is an initiative to address healthcare needs of employees.
Benefits under this programme include health mailers, doctor on call, health check-up
camps and talks on wellness by experts. The Bank runs an on-site crche at Kanjurmarg,
Mumbai.
These initiatives create a connect among employees and also helps them forge an
emotional bond with the organization. Further, a strong feedback mechanism helps shape the
programmes and aligns them with people's expectations and organisation policies.
Training and Development: Training plans are developed based on analysis of
training needs identified in consultation with various businesses. An extensive bouquet of
training programmes are delivered covering on-boarding, product and process training,
advanced programmes and behavioural training. The on-boarding training ensures that new
employees are trained comprehensively and equipped with necessary know-how, as well as
functional and behavioural skills required for the role. The product training and advanced
programmes enable skill development, regular updates and build expertise. The training
methodology has evolved to application based training including simulations, case studies
and games. Leveraging technology, many of the class room programmes are now being
delivered through online mode. The role specific learning plan ensures effective use of
blended learning method.
Rewards: Merit is the driving force in the organisation and objectivity the
watchword while rewarding employees on a financial and non-financial basis. This fair and
equitable approach encourages people to give their best. The compensation policy ensures
that remuneration is not only competitive but also includes wealth creation opportunities
through long-term rewards like ESOPs. Your Bank's comprehensive compensation policy is
aligned with the guidelines of the Reserve Bank of India. The Star Awards' is an
institutionalised recognition programme that periodically recognizes performers. The
Tejaswini Awards' is a special category to recognize women achievers.
Other Statutory Disclosures
Board and Board Committees
The details of Board meetings held during the year, attendance of Directors at the
meetings and constitution of various Committees of the Board are included separately in
the Corporate Governance Report.
Extract of Annual Return
Pursuant to section 92 (3) of the Companies Act, 2013 and Rule 12 (1) of the Companies
(Management and Administration) Rules, 2014, the extract of the Annual Return is annexed
as ANNEXURE 3 to this report.
Directors' Responsibility Statement
Pursuant to Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013,
the Board of Directors hereby state that:
In the preparation of the annual accounts, the applicable accounting standards
have been followed along with proper explanation relating to material departures, if any
We have selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view
of the state of affairs of the Bank as on March 31,2017 and of the profit of the Bank for
the year ended on that date
We have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 2013 for
safeguarding the assets of the Bank and for preventing and detecting fraud and other
irregularities
We have prepared the annual accounts on a going concern basis
We have laid down internal financial controls to be followed by the Bank and
that such internal financial controls are adequate and were operating effectively
We have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems were adequate and were operating effectively
Installation of green locks and AC controllers in air conditioning machines in
order to save energy and support go-green initiative
Installation of energy capacitors at high consumption offices to control the
power factor and to reduce energy consumption
All main signboards in branches switched off post 10 p.m.
Put controls on usage of lifts, ACs, common passage lights and other electrical
equipment
Auditors
The Auditors, M/s. Deloitte Haskins & Sells, Chartered Accountants, will retire at
the conclusion of the forthcoming Annual General Meeting and are eligible for
re-appointment. During the year under review, fees paid to the auditors were as follows:
Fees (including taxes) |
Rs.lacs |
Statutory Audit (Rs.1,90,00,000 plus taxes) |
218.50 |
Certification & other services provided as statutory auditors |
39.08 |
Total |
257.58 |
Members are requested to consider their re-appointment for financial year 2017-18.
Disclosure under Foreign Exchange Management Act, 1999
The Bank is in compliance with the Foreign Exchange Management Act, 1999 (FEMA)
provisions with respect to downstream investments made in its subsidiaries. Further, the
Bank has obtained a certificate from its statutory auditors certifying that the Bank is in
compliance with the FEMA provisions with respect to downstream investments made in its
subsidiaries in the year under review.
Related Party Transactions APPLICABLE
Particulars of transactions with related parties referred to in Section 188 (1), as
prescribed in Form AOC-2 under Rule 8 (2) of the Companies (Accounts) Rules, 2014 is
enclosed as ANNEXURE 4.
Particulars of Loans, Guarantees or Investments
Pursuant to Section 186 (11) of the Companies Act, 2013, THEHMAINTENANCEE the
provisions of Section 186 of Companies Act, 2013, except sub-section (1), do not apply to
a loan made, guarantee given or security provided by a banking company in the ordinary
course of business. Further, in terms of the Companies (Removal of Difficulties) Order,
2015, nothing in Section 186 except sub section (1) shall apply to any acquisition made by
a banking company in the ordinary course of business. The particulars of investments made
by the Bank are disclosed in Schedule 8 BE FOLLOWED of the Financial Statements as per the
applicable provisions of Banking Regulation Act, 1949.
Financial Statements of Subsidiaries and Associates
In terms of Section 134 of the Companies Act, 2013 and read with Rule 8 (1) of the
Companies (Accounts) Rules, 2014 the performance and financial position of the Bank's
subsidiaries and associates are enclosed as ANNEXURE 5 to this report. There were
no entities which became or ceased to be the Bank's subsidiaries, associates or joint
ventures during the year, except Atlas Documentary Facilitators Company Private Limited
and HBL Global Private Limited, associates of the Bank, which amalgamated with the Bank's
subsidiary HDB Financial Services Limited, pursuant to the approval of the Honourable
High Court of Gujarat and Bombay with effect from December 1, 2016. The appointed date
of the merger as per the scheme of amalgamation was April 1, 2014.
Whistle Blower Policy/Vigil Mechanism
The Bank has adopted a Whistle Blower Policy pursuant to which employees of the Bank
can raise their concerns relating to fraud, malpractice or any other activity or event
which is against the interest of the Bank or society as a whole. Details of complaints
received and the action taken are reviewed by the Audit Committee. The functioning of the
Whistle Blower mechanism is reviewed by the Audit Committee from time to time. None of the
Bank's personnel have been denied access to the Audit Committee.
Declaration by Independent Directors
Mrs. Shyamala Gopinath, Mr. Partho Datta, Mr. Bobby Parikh, Mr. A. N. Roy, Mr. Malay
Patel and Mr. Umesh Chandra Sarangi are Independent Directors on the Board of the Bank as
on March 31, 2017. All the Independent Directors have given their respective declarations
under Section 149 (6) and (7) of the Companies Act, 2013 and the Rules made thereunder. In
the opinion of the Board, the Independent Directors fulfil the conditions relating to
their status as Independent Directors as specified in Section 149 of the Companies Act,
2013 and the Rules made thereunder.
Board Performance Evaluation
The Nomination and Remuneration Committee (NRC) has approved a framework/policy for
evaluation of the Board, Committees of the Board and the individual members of the Board.
The said framework/policy was duly reviewed during the year. A questionnaire for the
evaluation of the Board and its Committees, designed in accordance with the said framework
and covering various aspects of the performance of the Board and its Committees, including
composition and quality, roles and responsibilities, processes and functioning, adherence
to Code of Conduct and Ethics and best practices in Corporate Governance was sent out to
the Directors. The responses received to the questionnaires on evaluation of the Board and
its Committees were placed before the meeting of the Independent Directors for
consideration. The assessment of the Independent Directors on the performance of the Board
and its Committees was subsequently discussed by the Board at its meeting.
Your Bank has in place a process wherein declarations are obtained from the directors
regarding fulfilment of the fit and proper' criteria in accordance with the
guidelines of the Reserve Bank of India. The declarations from the Directors other than
members of the NRC are placed before the NRC and the declarations of the members of the
NRC are placed before the Board. Assessment on whether the Directors fulfil the said
criteria is made by the NRC and the Board on an annual basis. In addition, the
framework/policy approved by the NRC provides for a performance evaluation of the
Non-Independent Directors by the Independent Directors on key personal and professional
attributes and a similar performance evaluation of the Independent Directors by the Board,
excluding the Director being evaluated. Such performance evaluation has been duly
completed as above.
Policy on Appointment and Remuneration of Directors and Key Managerial Personnel
The Nomination and Remuneration Committee (NRC) recommends the appointment of Directors
to the Board. It identifies persons who are qualified to become Directors on the Board and
evaluates criteria such as academic qualifications, previous experience, track record and
integrity of the persons identified before recommending their appointment to the Board.
The remuneration of whole time Directors is governed by the compensation policy of the
Bank. The compensation policy of the Bank, duly reviewed and recommended by the NRC has
been articulated in line with the Reserve Bank of India guidelines.
Your Bank's compensation policy is aimed to attract, retain, reward and motivate
talented individuals critical for achieving strategic goals and long term success.
Compensation policy is aligned to business strategy, market dynamics, internal
characteristics and complexities within the Bank. The ultimate objective is to provide a
fair and transparent structure that helps the Bank to retain and acquire the talent pool
critical to building competitive advantage and brand equity.
Your Bank's approach is to have a pay for performance culture based on the belief that
the Performance Management System provides a sound basis for assessing performance
holistically. The compensation system should also take into account factors like roles,
skills/competencies, experience and grade / seniority to differentiate pay appropriately
on the basis of contribution, skill and availability of talent on account of competitive
market forces. The details of the compensation policy are also included in Schedule 18
Notes forming part of the Accounts - Note no. 25. Non-Executive Directors are paid
remuneration by way of sitting fees for attending meetings of the Board and its
Committees, which are determined by the Board based on applicable regulatory
prescriptions. Non-Executive Directors are also reimbursed expenses incurred by them for
attending meetings of the Board and its Committees at actuals. The remuneration payable to
the Non-Executive Directors and Independent Directors is governed by the provisions of the
Banking Regulation Act, 1949, RBI guidelines issued from time to time and the provisions
of the Companies Act, 2013 and related rules to the extent it is not inconsistent with the
provisions of the Banking Regulation Act, 1949 and RBI guidelines. In terms of the
guidelines issued by RBI for compensation of Non-Executive Directors of private sector
banks dated June 1, 2015 and the approval of shareholders at the 22nd Annual
General Meeting, Non-Executive Directors of the Bank, other than the Chairperson, are paid
profit-related commission of Rs.10,00,000/- (Rupees Ten Lakh only) per annum for each
Non-Executive Director.
Mr. Aditya Puri is the Non-Executive Chairman of HDB Financial Services Limited, Bank's
subsidiary. Mr. Puri does not receive any remuneration from the subsidiary. None of the
Directors of your Bank other than Mr. Puri is a director of the Bank's subsidiaries as on
March 31, 2017.
Significant and Material Orders Passed By Regulators
During the financial year 2016-17, further to the media reports in October 2015 about
irregularities in advance import remittances in various banks, the Reserve Bank of India
(RBI) had conducted a scrutiny of the transactions carried out by the Bank under Section
35 (1A) of the Banking Regulation Act, 1949. The RBI issued a Show Cause notice to which
the Bank had submitted its detailed response. After considering the Bank's submission, the
RBI imposed a penalty of Rs.2 crore on the Bank vide its letter dated July 19, 2016 on
account of pendency in receipt of bill of entry relating to advance import remittances
made and lapses in adhering to KYC/AML guidelines in this respect. The penalty has since
been paid. The Bank has implemented a comprehensive corrective action plan, to strengthen
its internal control mechanisms so as to ensure that such incidents do not recur.
Directors and Key Managerial Personnel
The Bank proposes to re-appoint Mr. Paresh Sukthankar and Mr. Kaizad Bharucha as Deputy
Managing Director and Executive Director of the Bank, respectively, for a period of three
years each with effect from June 13, 2017, subject to the approval of the Reserve Bank of
India and the shareholders at the ensuing Annual General Meeting. In compliance with
Section 152 of the Companies Act, 2013, Mr. Sukthankar and Mr. Bharucha will also retire
by rotation at the ensuing Annual General Meeting and are eligible for re-appointment. The
Bank also proposes to re-appoint Mrs. Shyamala Gopinath at the ensuing Annual General
Meeting as the Part Time Non-Executive Chairperson of the Bank for a period of three years
commencing from January 2, 2018 till January 1, 2021 or till such other earlier or later
date(s) as may be approved by Reserve Bank of India, and as subsequently extended by the
Reserve Bank of India from time to time.
During the year, Mr. Srikanth Nadhamuni was appointed as an Additional Director of the
Bank with effect from September 20, 2016 to hold office till the conclusion of the ensuing
Annual General Meeting. Mr. Nadhamuni has been appointed as a director having expertise in
the field of Information Technology. In terms of Section 152 of the Companies Act, 2013,
it is proposed to appoint Mr. Nadhamuni as a Director of the Bank at the ensuing Annual
General Meeting. The Bank has received a notice from a member proposing his candidature as
Director of the Bank. Mr. Nadhamuni shall be liable to retire by rotation.
The brief resume/details regarding the Directors proposed to be appointed/re-appointed
as above are furnished in the report on Corporate Governance. There have been no changes
in the Directors and Key Managerial Personnel of the Bank other than the above.
Familiarisation Programme for Independent Directors
The various programmes undertaken for familiarising Independent Directors with the
functions and procedures of the Bank are disclosed in the Corporate Governance Report.
Particulars of Employees
The information in terms of Rule 5 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 is given in ANNEXURE 6 and ANNEXURE 7 to
this report.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
(A) Conservation of Energy
Your Bank has undertaken several initiatives in this area such as
(B) Technology Absorption
Your Bank has been at the forefront of using technology absorption and evaluates
innovative technology with multiple fintech partners. In the year under review, it
organised its 2nd Digital Innovation Summit' and shortlisted several
fintech startups to carry out multiple proof of concepts in both customer facing and
internal processes.
Your Bank uses advanced analytics to create a 360 degree view of all 4.05 crore
customers. The analytics engine uses machine learning to analyze structured and
unstructured data which help in offering relevant product/ service recommendations using
advanced algorithms. These are delivered via personalized campaigns through an
omni-channel approach. Your Bank has also begun using robotics and artificial intelligence
in digital commerce, corporate supply chain and payment settlement systems to reduce time
to market and turnaround time.
(C) Foreign Exchange Earnings and Outgo
During the year, the total foreign exchange earned by the Bank was Rs.1,263.4 crore (on
account of net gains arising on all exchange/derivative transactions) and the total
foreign exchange outgo was about Rs.221 crore towards the operating and capital
expenditure requirements.
Secretarial Audit
In terms of Section 204 of the Companies Act, 2013 and the Rules made thereunder, M/s.
BNP & Associates, Practising Company Secretaries have been appointed as Secretarial
Auditors of the Bank for the financial year 2016-17. The report of the Secretarial
Auditors is enclosed as ANNEXURE 8 to this Report. The observations in the said
report are self-explanatory and no further comments/explanations are called for.
Corporate Governance
In compliance with Regulation 34 and other applicable provisions of the Securities and
Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,
2015, a separate report on Corporate Governance along with a certificate of compliance
from the Secretarial Auditors, forms an integral part of this Report.
Business Responsibility Report
The Bank's Business Responsibility Report containing a report on its Corporate Social
Responsibility Activities and Initiatives in the format adopted by companies in India as
per the guidelines of the Securities and Exchange Board of India in this regard is
available on its web site www.hdfcbank.com
Information under the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013
The relevant information is included in Section E-Principle 3 of the Business
Responsibility Report for 2016-17.
Acknowledgement
Your Directors would like to place on record their gratitude for all the guidance and
co-operation received from the Reserve Bank of India and other government and regulatory
agencies. Your Directors would also like to take this opportunity to express their
appreciation for the hard work and dedicated efforts put in by the Bank's employees and
look forward to their continued contribution in building a World Class Indian Bank.'
Conclusion
The global economy is facing risks emanating from policy uncertainty in the US,
imminent elections in several European countries and rising protectionism. The Indian
economy seems better placed. And so is your Bank which is on course to continue to outgrow
the system, as it has in the year under review.
Like in the past, the Bank will continue to leverage its distribution strength and
digital platforms especially in the rural and semi-urban parts of the country for
sustainable growth.
Needless to say, the Bank will continue to focus on its 5 core values namely Customer
Focus, Operational Excellence, Product Leadership, People and Sustainability. Its
commitment to the highest possible standards of corporate governance remains unwavering.
All of this will help the Bank on its onward growth journey and help create long-term
shareholder value.
|
On behalf of the Board of Directors |
|
Mrs. Shyamala Gopinath |
|
Chairperson |
Mumbai, May 29, 2017 |
|
ANNEXURE 1 to the Directors' Report
The ESOP Schemes of the Bank are in compliance with SEBI (Share Based Employee
Benefits) Regulations, 2014 ("the Regulations") and the details as per the
Regulations are as under:
EMPLOYEES' STOCK OPTIONS AS ON MARCH 31,2017
Plan / Schemes |
Date of Shareholders' Approval |
Total No. of Options Approved |
Grant Price (') |
Number of Options Outstanding at the beginning of the year |
Number of Options Granted / Options Re-instated |
Options Vested |
Number of Options Exercised & Shares Allotted during the year |
Number of Options Forfeited during the year |
Number of Options Lapsed during the year |
Number of Options in Force at the end of the year |
Plan E- ESOS XVI |
30th June, 2010 |
100,000,000 |
440.16 |
1,674,000 |
- |
- |
1,674,000 |
- |
- |
- |
Plan E- ESOS XVII |
30th June, 2010 |
100,000,000 |
508.23 |
111,600 |
- |
- |
111,600 |
- |
- |
- |
Plan E- ESOS XVIII |
30th June, 2010 |
100,000,000 |
468.40 |
12,552,500 |
- |
- |
10,413,000 |
- |
100 |
2,139,400 |
Plan E- ESOS XIX |
30th June, 2010 |
100,000,000 |
680.00 |
23,512,100 |
- |
8,878,500 |
10,449,800 |
86,100 |
21,000 |
12,955,200 |
Plan D- ESOS XX |
16th June, 2007 |
75,000,000 |
680.00 |
5,133,900 |
- |
1,835,400 |
1,748,800 |
30,000 |
20,800 |
3,334,300 |
Plan C- ESOS XXI |
17th June, 2005 |
50,000,000 |
680.00 |
5,260,800 |
- |
1,719,300 |
942,400 |
- |
- |
4,318,400 |
Plan E- ESOS XXII |
30th June, 2010 |
100,000,000 |
664.45 |
- |
- |
- |
- |
- |
- |
- |
Plan C- ESOS XXIII |
17th June, 2005 |
50,000,000 |
835.50 |
480,000 |
- |
142,200 |
122,600 |
24,000 |
7,400 |
326,000 |
Plan F- ESOS XXIV |
27th June, 2013 |
100,000,000 |
835.50 |
36,442,200 |
- |
11,282,900 |
7,059,900 |
651,400 |
59,000 |
28,671,900 |
Plan F- ESOS XXV |
27th June, 2013 |
100,000,000 |
1092.65 |
43,484,200 |
- |
17,291,600 |
1,837,100 |
1,201,000 |
38,000 |
40,408,100 |
Plan F- ESOS XXVI |
27th June, 2013 |
100,000,000 |
1097.80 |
3,000 |
- |
1,200 |
- |
- |
- |
3,000 |
Total |
- |
- |
- |
128,654,300 |
- |
411,51,100 |
343,59,200 |
1,992,500 |
146,300 |
92,156,300 |
Options Exercised during the aforesaid period |
34,359,200 |
Share Capital Money received during the above period (?) |
68,718,400 |
Share Premium Money received during the above period (?) |
22,546,443,173 |
Perquisite Tax Amount collected during the aforesaid period (?) |
7,074,356,786 |
Total Amount collected during the aforesaid period (?) |
29,689,518,359 |
Note:
1. One (1) share of the face value of' 2/- each would arise on exercise of One (1)
Equity Stock Option.
2. No Stock Options were granted during the year 2016-17.
Vesting Requirements |
Except for the death / permanent disablement or retirement of the employee, the
options will vest only if the employee is in the continuous employment of the Bank as on
the date of vesting |
Maximum Term of Options |
Provided the employee is in the continuous employment of the Bank, the options vested
will lapse in case the same are not exercised by the employee within 4 years from the date
of vesting. Except in the case of death/ permanent disablement or retirement of the
employee, all unvested options get forfeited on the employee's last working date in the
Bank. |
Source of shares |
Primary |
Variation in terms of ESOS |
Nil |
Diluted Earnings Per Share (EPS) pursuant to the issue of shares on exercise of option
calculated in accordance with Accounting Standard (AS) - 20 (Earnings Per Share) |
The diluted EPS of the Bank calculated after considering the effect of potential
equity shares arising on account of exercise of options is ' 56.4 |
Where the company has calculated the employee compensation cost using the intrinsic
value of the stock options, the difference between the employee compensation cost so
computed and the employee compensation cost that shall have been recognized if it had used
the fair value of the options, shall be disclosed. The impact of this difference on
profits and on EPS of the company shall also be disclosed |
Had the Bank followed fair value method for accounting, the stock option compensation
expense would have been higher by ' 812.7 crore. Consequently profit after tax would have
been lower by ' 812.7 crore and the basic EPS of the Bank would have been ' 54.0 per share
(lower by ' 3.2 per share) and the diluted EPS would have been '53.3 per share (lower by '
3.2 per share) |
Weighted average exercise prices and weighted average fair values of options shall be
disclosed separately for options whose exercise price either equals or exceeds or is less
than the market price of the stock options |
The weighted average price of the stock options exercised is '658.2 and the weighted
average fair value is '235.3 |
Method used and assumptions made to incorporate effects of expected early exercise |
The exercise multiple, which is based on historical data of early option exercise
decisions of the employees, incorporates early exercise price effect in the valuation of
ESOPs. The exercise multiple indicates that option holders tend to exercise their options
when the share price reaches a particular multiple of the exercise price. |
How expected volatility was determined, including explanation of the extent to which
expected volatility was based on historical volatility |
Stock expected volatility is completely based on GARCH volatility forecasting model
using historical stock prices from the market. |
Whether and how any other features of the option grant were incorporated into the
measurement of fair value, such as a market condition |
Stock price and risk free interest rate are variables based on actual market data at
the time of ESOP valuation. |
ANNEXURE 4 to the Directors' Report
Form No. AOC - 2
(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of
the Companies (Accounts) Rules, 2014)
Form for disclosure of particulars of contracts/arrangements entered into by the
company with related parties referred to in sub-section (1) of section 188 of the
Companies Act, 2013 including certain arm's length transactions under third proviso
thereto
1. Details of contracts or arrangements or transactions not at arm's length basis: Nil
2. Details of material contracts or arrangement or transactions at arm's length basis
|
|
(? crore |
(a) Name(s) of the related party |
HDB Financial Services Limited |
HDFC Securities Limited |
Nature of relationship |
Subsidiary of the Bank |
Subsidiary of the Bank |
(b) Nature of contracts/ arrangements/ transactions |
Receipt of Deposits |
Payment towards collection services availed |
Payment of Back Office Support Service Fees |
Payment of Sales Support Service Fees |
Credit facility provided |
Interest earned on Credit Facility provided |
Syndicator/ Arranger & Investor |
Receipt of Deposits |
(c) Duration of the contracts / arrangements/ transactions |
Varying maturities |
Until termination |
5 years |
2 years |
Up to 42 months |
|
Varying maturities |
Varying maturities |
(d) Salient terms of the contracts or arrangements or transactions including the
value, if any: |
Term and demand deposits placed with the Bank |
Services availed for follow-up and collection of customer dues and
claims from insurance companies |
Back office support services such as data processing availed by the Bank |
Sales support services for loans and third party products provided by
the Bank |
Cash Credit and Term Loans provided |
Interest earned |
Syndicator/ Arranger Fees for NCDs/ Bonds Value: 0.83 |
Term and demand deposits placed with the Bank |
|
Outstanding Value: 126.44 |
Value: 103.13 |
Value: 561.52 |
Value: 786.11 |
Outstanding Value: 1180.15 |
Value: 139.21 |
Investment Value: 1427.00 |
Outstanding Value : 471.22 |
(e) Date(s) of approval by the Board, if any: |
N.A. |
N.A. |
N.A. |
N.A. |
N.A. |
N.A. |
N.A. |
N.A. |
(f) Amount paid as advances, if any: |
Nil |
Security deposit: 9.75 |
Nil |
Nil |
Nil |
Nil |
Nil |
Nil |
The above mentioned transactions were entered into by the Bank in its ordinary
course of business. Materiality threshold is as prescribed in Rule (3) of the Companies
(Meetings of Board and its Powers) Amendment Rules, 2017.
Certain transactions are not disclosed due to banker- customer relationship.
These transactions are at arm's length basis.
ANNEXURE 5 to the Directors' Report
Performance and financial position of subsidiaries and associates of the Bank as on
March 31,2017
|
|
(' crore) |
Name of entity |
Net assets as of March 31,2017 |
Profit or loss for the year ended March 31,2017 |
|
As percentage of consolidated net assets** |
Amount*** |
As percentage of consolidated profit or loss |
Amount*** |
Parent: |
|
|
|
|
HDFC Bank Limited |
97.46% |
89,462.38 |
95.39% |
14,549.66 |
Subsidiaries*: |
|
|
|
|
1. HDFC Securities Limited |
0.88% |
807.41 |
1.42% |
215.90 |
2. HDB Financial Services Limited |
5.84% |
5,362.90 |
4.49% |
684.21 |
Minority Interest in all subsidiaries |
0.32% |
291.44 |
0.24% |
36.72 |
*The subsidiaries are domestic entities
**Consolidated net assets are total assets minus total liabilities including minority
interest ***Amounts are before inter-company adjustments.
|
|
(' crore) |
Name of entity |
Investment as per equity method as of March 31,2017 |
Share of profit or loss for the year ended March
31,2017 |
|
As percentage of consolidated net assets |
Amount |
As percentage of consolidated profit or loss |
Amount |
Associate*: |
|
|
|
|
International Asset Reconstruction Company Private Limited |
0.04% |
40.30 |
0.02% |
2.34 |
*The associate is a domestic entity
ANNEXURE 6 to the Directors' Report
Disclosures on Remuneration
1. Ratio of Remuneration of each director to the median employees' remuneration for the
year
Designation |
Ratio |
Managing Director |
187:1 |
Deputy Managing Director |
113:1 |
Executive Director |
93:1 |
Note:
a. We have considered fixed pay for the computation of ratios as the performance bonus
for the previous year for Whole time Directors is subject to RBI approval.
b. Fixed pay includes-Salary Allowances, Retiral Benefits as well as value of
perquisites excluding ESOPs
c. The above includes all employees of the Bank excluding overseas employees.
2. Percentage increase in remuneration of each Director, CFO, CEO, CS or Manager, if
any, in the FY
Designation |
Percentage Increase |
Managing Director |
20.00 |
Deputy Managing Director |
20.00 |
Executive Director * |
40.00 |
Chief Financial Officer |
5.00 |
Company Secretary |
7.00 |
The increase in the remuneration includes increase given for salary alignment with
Whole Time Directors both internally and externally.
3. Percentage Increase in the median remuneration of employees in the financial year
The percentage increase in median remuneration of employees in the financial year was
11.12 per cent. The percentage movement in the median remuneration of the employees for
the financial year was 1.51 per cent.
4. The number of permanent employees on the rolls of the Bank
As of March 31,2017 the number of permanent employees on the rolls of the Bank was
84,325.
5. Average percentage increase already made in the salaries of employees other than the
managerial personnel in the last financial year and its comparison with the percentage
increase in the managerial remuneration and justification thereof and point out if there
are any exceptional circumstances for increase in the managerial remuneration.
The average percentage increase for Key Managerial Personnel |
18.40 per cent |
The average percentage increase for Non Managerial Staff |
9.69 per cent |
6. Affirmation that the remuneration is as per the remuneration policy of the company:
YES
ANNEXURE 7 to the Directors' Report
Statement under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 for year ended March 31,2017
Name of the Employee |
Designation |
Date of joining the Bank |
Qualifications |
Age |
Exp. |
Total (') |
Last Employment |
Details of top ten employees in terms of remuneration drawn |
Aditya Puri |
Managing Director |
12-Sep-94 |
B.Com, CA. |
66 |
44 |
100,572,147 |
Citibank |
2 Paresh Sukthankar |
Deputy Managing Director |
01-Sep-94 |
B.Com, M.M.S, A.M.P (Harvard Business School) |
54 |
32 |
60,808,440 |
Citibank |
3 Kaizad M. Bharucha |
Executive Director |
04-Oct-95 |
B.Com |
52 |
31 |
46,610,835 |
SBI Commercial & International Bank Ltd. |
4 Abhay Aima |
Group Head |
02-Jan-95 |
Grad. from National Defence Academy |
55 |
30 |
26,264,867 |
INDSEC Securities & Finance Ltd. |
5 Rakesh Singh |
Group Head |
11-Apr-11 |
MBA, B.Sc |
48 |
24 |
24,476,625 |
Roth Child |
6 Navin Puri |
Group Head |
01-Feb-99 |
B.Com, MBA, CA |
59 |
34 |
24,090,454 |
ANZ Grindlays Bank |
7 Ashish Parthasarthy |
Group Head |
01-Nov-94 |
B.E., PGDM |
49 |
28 |
23,523,385 |
INDSEC Investments Ltd. |
8 Bhavesh Zaveri |
Group Head |
13-Apr-98 |
M.Com., CAIIB |
51 |
28 |
23,389,168 |
Barclays Bank |
9 Sashidhar Jagdishan |
Group Head |
05-Feb-96 |
B.Sc., ACA., M.A (Economics) |
52 |
25 |
23,134,669 |
Deutsche Bank |
10 Payal Mandhyan* |
Vice President |
18-Jan-05 |
PGDBM |
39 |
13 |
22,684,467 |
India Bulls Securities Ltd. |
Persons in service for the whole year and drawing emoluments more than '
10,200,000/- per annum, other than the above |
Abhishek Bhuwalka |
Sr Vice President-I |
10-Jun-99 |
MBA, CWA, B.Com |
40 |
21 |
13,784,220 |
Matchless Packaging Industries (P) Ltd. |
2 Ajay Kumar Kapoor |
Sr Exe Vice President |
09-Oct-95 |
M.Sc. |
53 |
31 |
12,955,221 |
Times Bank Ltd. |
3 Akshat Lakhera |
Sr Vice President-I |
09-Sep-10 |
PGDM, B.Sc |
40 |
16 |
15,567,571 |
BNP Paribas |
4 Ameya Shekhar Shenoy |
Vice President |
20-Mar-06 |
MBA, CA, B.Com |
38 |
13 |
11,499,582 |
Tionale Enterprises Pvt Ltd |
5 Amit Dayal |
Exe. Vice President |
19-Dec-94 |
B.Sc., DBM |
50 |
26 |
16,814,052 |
SBI Commercial & International Bank Ltd |
6 Anil L. Bhavnani |
Exe. Vice President |
16-Jun-03 |
CS, B.Com |
44 |
23 |
11,082,765 |
CitiCorp Finance I Ltd. |
7 Ankush Pitale |
Exe. Vice President |
28-Jul-14 |
MMS |
45 |
21 |
13,324,739 |
Religare Capital Markets Pvt. Limited |
8 Anupama Rajesh Munagekar |
Sr Vice President-I |
14-Feb-07 |
LL.B, B.Com |
49 |
25 |
13,680,448 |
Strategic Capital Corporation Pvt Ltd |
9 Arun Mohanty |
Exe. Vice President |
09-Nov-05 |
BA |
59 |
35 |
12,791,009 |
Reserve Bank Of India |
10 Arup Kumar Rakshit |
Sr Exe Vice President |
01-Aug-06 |
PGDM, B.E |
48 |
31 |
21,287,305 |
ABN Amro Bank |
11 Arvind Kapil |
Group Head |
18-Dec-98 |
MMS, B.E |
46 |
23 |
15,214,374 |
GE Countrywide Consumer Financial Services Ltd. |
12 Aseem Dhru |
Group Head |
02-May-15 |
CA,CWA, B.Com |
47 |
22 |
18,399,069 |
HDFC Securities Ltd |
13 Ashima Khanna Bhat |
Group Head |
07-Nov-94 |
B. Bus, MMS |
46 |
24 |
17,617,273 |
A F Ferguson & Co |
14 Ashok Khanna |
Group Head |
19-Jun-02 |
MA |
60 |
36 |
15,977,850 |
Centurion Bank |
15 Ashtosh Raina |
Sr Vice President-I |
03-Sep-07 |
CAIIB, B.Sc |
49 |
26 |
13,352,345 |
State Bank Of India |
16 Atul Sadashiv Barve |
Exe. Vice President |
28-Feb-07 |
MMS, MA, B.Sc |
54 |
33 |
11,704,496 |
IDBI Ltd |
17 Benjamin Frank |
Sr Exe Vice President |
05-Apr-04 |
MBA, B.Sc |
53 |
31 |
12,044,784 |
IDBI Bank Ltd. |
18 Bhaskar C. Panda |
Sr Vice President-II |
21-Nov-97 |
BA |
55 |
32 |
17,049,345 |
Times Bank Ltd. |
19 Charmaine Pereira |
Sr Vice President-II |
01-Nov-94 |
DBM, BA |
44 |
22 |
13,759,774 |
Fresher |
20 Debajeet Das |
Sr Vice President-II |
06-Aug-96 |
MA |
45 |
22 |
18,032,347 |
Texport Syndicate |
21 Dolreich D'Mello* |
Dy. Vice President |
09-Jan-97 |
B.Com |
41 |
20 |
12,406,545 |
ANZ Grindlays Bank |
22 Farid Ahmed* |
Asst. Vice President |
07-May-07 |
MBA, B.Sc |
39 |
17 |
11,767,196 |
Kotak Mahindra Bank Ltd |
23 Fayaz Ainodin Patel* |
Asst. Vice President |
02-Aug-10 |
MBA, B.Com |
38 |
14 |
10,303,038 |
Sharekhan Ltd |
24 Gopalkrishnan Santosh |
Exe. Vice President |
17-Jan-01 |
B.Com |
47 |
25 |
10,882,803 |
American Express Bank |
25 Govind Pandey |
Sr Exe Vice President |
05-Aug-98 |
MSC |
60 |
34 |
13,312,806 |
State Bank of Saurashtra |
26 Gulzar Singh |
Sr Exe Vice President |
28-Oct-96 |
PGDM, BA |
46 |
23 |
12,895,189 |
Times Bank Ltd. |
27 Harsh S Gupta* |
Sr Vice President-I |
04-Sep-00 |
PGDBA, B.Sc |
41 |
19 |
18,189,331 |
ICICI Cap Ltd |
28 Imran Ali Baig* |
Vice President |
05-Jun-97 |
PGDBA, CFA-A, B.Sc |
44 |
20 |
11,440,147 |
Fresher |
29 Jay Sonawala |
Sr Vice President-II |
12-Aug-99 |
MMS, B.Com |
41 |
18 |
12,498,838 |
Fresher |
30 Jimmy Tata |
Group Head |
15-Dec-94 |
B.Com., M.F.M., CFA |
51 |
29 |
20,012,753 |
Apple Industries Ltd. |
31 K. Manohara Raj |
Sr Exe Vice President |
06-Dec-96 |
CAIIB, B.Com |
59 |
37 |
11,579,370 |
Times Bank Ltd. |
32 Kapil Bansal |
Sr Vice President-I |
30-Sep-04 |
PGPM, B.Com |
39 |
18 |
13,053,654 |
ICICI Bank Ltd. |
33 Kinjul Sharma* |
Asst. Vice President |
22-Sep-08 |
Master's Degree/Dip,B.Com |
36 |
12 |
11,004,904 |
Citifinancial |
34 Madhusoodan Hegde |
Exe. Vice President |
11-Feb-97 |
CAIIB, B.Sc. |
56 |
32 |
12,095,216 |
Times Bank Ltd. |
35 Mahesh KumarJugal Kishoretaparia |
Sr Vice President-I |
11-Jun-05 |
LLB, CS, CA, B.Com |
40 |
15 |
11,183,867 |
UTI Bank Ltd |
36 Maheswara P Reddy |
Sr Vice President-I |
06-May-02 |
MBA, BA |
46 |
21 |
14,042,294 |
American Express Bank |
37 Makarand Shrikant Khandekar |
Asst. Vice President |
18-Mar-14 |
B.E |
42 |
19 |
12,260,022 |
ICICI Securities Limited |
38 Manu Joseph* |
Dy. Vice President |
13-Nov-11 |
MMS,B.E |
40 |
15 |
12,467,442 |
Citibank |
39 Mathew Varghese* |
Asst. Vice President |
15-Jul-10 |
MMS,B.E |
38 |
15 |
10,613,306 |
Citibank |
40 Mayuresh Vasant Apte |
Sr Vice President-II |
06-Nov-00 |
MMS, B.TECH, C.H.S.E, C.B.S.E |
48 |
24 |
11,889,576 |
Centurion Bank Ltd |
41 Michael Andrade |
Exe. Vice President |
01-Aug-97 |
MFA, DSM, B.Sc. |
49 |
29 |
10,359,492 |
Barclays Bank |
42 Mohammed Hannan Abdul* |
Asst. Vice President |
01-JUI-09 |
MBA, BSc |
38 |
14 |
12,313,621 |
Barclays Bank PLC |
43 Munish Mittal |
Group Head |
17-Aug-96 |
PGDM, B.Sc. |
49 |
30 |
14,329,500 |
Bank Of Punjab |
44 N. Srinivasan |
Exe. Vice President |
11-Nov-96 |
CA, CWA, CS., B.Com |
49 |
27 |
11,349,866 |
Credential Finance |
45 Neil Percy Francisco |
Group Head |
20-May-02 |
MBA, M.Sc., BE |
55 |
26 |
13,108,718 |
Standard Chartered bank |
46 Nirav Shah |
Group Head |
15-Jul-99 |
MMS, B.Com |
45 |
22 |
19,186,484 |
Global Trust Bank |
47 Nishant Nangia* |
Asst. Vice President |
04-Apr-05 |
B.Com |
35 |
14 |
12,816,723 |
E-Serve International Ltd |
48 Nishikant Das |
Exe. Vice President |
23-Apr-12 |
PGDM, B.TECH |
45 |
19 |
18,011,034 |
Standard Chartered Bank |
49 Nitin Chugh |
Group Head |
16-Apr-01 |
PGDM, B.TECH |
46 |
22 |
17,069,362 |
Standered Chartered Bank |
50 Nitin Subramanya Rao |
Group Head |
25-JUI-02 |
BE, MBA |
50 |
27 |
19,003,464 |
BNP Paribas |
51 Pallava Rathore* |
Vice President |
27-Jun-08 |
Master's Degree/Dip, BSc |
41 |
16 |
10,566,455 |
IDBI Bank Ltd |
52 Parag Rao |
Group Head |
15-Apr-02 |
MMS, B.E |
52 |
28 |
14,487,588 |
IBM Global Services |
53 Philip Mathew |
Group Head |
03-Apr-02 |
MA, B.Sc |
54 |
28 |
13,402,369 |
SSKI Investor Services |
54 Pratap Luthra |
Dy. Vice President |
13-Aug-05 |
MBA,BA |
35 |
14 |
12,284,191 |
ABN Amro Bank Ltd |
55 Rahul Bhandari* |
Vice President |
05-Feb-02 |
PGDBM, B.Com |
39 |
15 |
14,318,661 |
Fresher |
56 Rajeev Sengupta |
Exe. Vice President |
21-Sep-07 |
PG (Gen Mgmt), B.E |
56 |
34 |
11,452,865 |
Hutchison Essar Ltd |
57 Rajeev Wariar* |
Vice President |
15-Apr-10 |
PGDBA, B.E |
42 |
18 |
16,800,081 |
Citi Bank |
58 Rajender Sehgal |
Group Head |
23-Feb-98 |
B.Sc, MBA |
62 |
40 |
17,558,390 |
Times Bank Ltd. |
59 Rajesh Kumar Rathanchand |
Group Head |
22-May-00 |
PGDM, B.Sc |
46 |
28 |
14,425,888 |
Trans America Apple Finance Ltd. |
60 Rajesh Sharma |
Sr Vice President-II |
15-Nov-00 |
CA,CS, B.Com |
41 |
23 |
10,326,591 |
LCC Infotech Ltd |
61 Rajinder Babbar |
Exe. Vice President |
16-Jan-01 |
LLB, B.Sc |
50 |
30 |
13,530,295 |
Centurion Bank Ltd |
62 Raveesh Kumar Bhatia |
Sr Exe Vice President |
03-May-10 |
PGDM, B.Com |
51 |
26 |
13,371,292 |
Fore Consultants Pvt Ltd |
63 Ravi Narayan |
Group Head |
03-May-99 |
MBA, B.TECH |
48 |
24 |
15,488,261 |
Bank Of America |
64 Ravi Ssn |
Sr Vice President-II |
26-Nov-10 |
B.Com |
49 |
17 |
11,133,605 |
Deutsche Bank |
65 Reji John* |
Manager |
30-Aug-10 |
PG Diploma, MA, BA |
36 |
13 |
11,600,552 |
Aviva India Life Insurance Co Ltd |
66 Resham A. Mahtani |
Sr Vice President-I |
01-May-01 |
PGPIM, PGDBM, BA |
41 |
19 |
12,978,555 |
Mecklai Financial & Commercial Services Ltd. |
67 Ritesh Sampat |
Sr Vice President-II |
03-Jan-12 |
CA, B.Com |
41 |
17 |
15,096,463 |
Standard Chartered Bank |
68 Roli Jamthe* |
Asst. Vice President |
05-Apr-11 |
MBA, B.Sc, PGDSM |
40 |
16 |
19,818,230 |
Royal Bank Of Scotland |
69 Sanjay Dongre |
Exe. Vice President |
02-May-95 |
B.Com, ACS, CWAINT, LL.B. |
59 |
35 |
10,608,483 |
Boehringer Mannheim Ltd. |
70 Sanjay K.Singla |
Sr Vice President-II |
10-Nov-07 |
PGDM, B.Com |
58 |
35 |
14,887,359 |
State Bank of India |
71 Sanmoy Chakrabarti |
Exe. Vice President |
15-Jun-10 |
MS, B.Sc |
42 |
18 |
12,792,397 |
Bank Danamon |
72 Sathyamurthy Sampath Kumar |
Exe. Vice President |
07-Aug-00 |
B.Com |
45 |
27 |
14,737,500 |
Integrated Finance Co. Ltd. |
73 Shailesh B. Sukhthankar |
Exe. Vice President |
01-Dec-94 |
MMS, B.Com |
52 |
30 |
10,430,441 |
Citicorp Overseas s/w Ltd |
74 Sharad Rungta |
Sr Vice President-II |
02-Jun-12 |
CFA, CA, B.Com |
40 |
16 |
15,368,533 |
Credit Suisse AG |
75 Sheetal Kapadia* |
Asst. Vice President |
06-May-09 |
PGDMS, B.Com |
40 |
17 |
13,535,124 |
ICICI Bank Ltd |
76 Silvestre Anthony Pereira |
Vice President |
15-Sep-06 |
MBA, PG Diploma, B.Com |
39 |
15 |
14,974,588 |
UTI Bank Ltd |
77 Sitanshu Mitra |
Exe. Vice President |
01-Sep-95 |
MBA, B.Sc |
49 |
29 |
10,609,777 |
ABN Amro Bank Ltd. |
78 Smita Bhagat |
Sr Exe Vice President |
12-Jul-99 |
M.Com, MBA |
52 |
29 |
13,347,040 |
PDCOR Ltd. |
79 Sukarm Bali* |
Sr Vice President-I |
23-JUI-99 |
CA, B.Com |
50 |
25 |
18,515,532 |
Times Bank Ltd. |
80 Sumant Rampal |
Exe. Vice President |
10-Aug-99 |
MBA, B.Com |
42 |
20 |
10,834,497 |
Walchnad Capital Ltd. |
81 Sundaresan M. |
Exe. Vice President |
02-May-02 |
B.E (Mechanical), PSG, MBA |
46 |
30 |
10,289,554 |
GE Countrywide Consumer Financial Services Ltd. |
82 Umashankar Gopalan* |
Dy. Vice President |
13-Dec-12 |
B.Com |
49 |
23 |
14,509,765 |
ICICI Bank |
83 V S Unnikrishnan* |
Vice President |
12-Apr-03 |
MBA, B.Sc, PUC |
42 |
19 |
13,101,738 |
Global Trust Bank Ltd |
84 V. Chakrapani |
Group Head |
24-Nov-94 |
B.Com, CAIIB, ACS |
53 |
33 |
17,244,662 |
Standard Chartered Bank |
85 Veerendra Rai* |
Asst. Vice President |
23-Apr-11 |
PGDBA, BBA |
38 |
14 |
11,350,131 |
RAK Bank |
86 Vijay Krishna Mulbagal |
Exe. Vice President |
02-Jan-07 |
PGPM, B.Sc |
46 |
22 |
14,077,651 |
Diamond Management & Technology Consultants |
87 Vitthal Mangesh Kulkarni |
Sr Vice President-I |
22-Sep-07 |
M.Sc., B.E |
46 |
23 |
12,147,623 |
Barclays Capital |
Persons employed for part of the year drawing emoluments more than ' 850,000 per month |
|
|
|
|
|
|
|
88 Deepak Maheshwari |
Group Head |
09-Feb-96 |
CAIIB, B.Com |
62 |
42 |
12,429,522 |
Times Bank Ltd. |
89 Harsh Dugar |
Executive Vice President |
23-Oct-96 |
CFA, CWA, B.Com |
44 |
26 |
8,840,172 |
ICFAI Business School |
90 K Balasubramanian |
Group Head |
03-May-16 |
CA, ICWA, B.Com |
46 |
21 |
15,479,725 |
Citibank |
91 KartikJain |
Executive Vice President |
09-May-11 |
PGDM, B.Tech |
47 |
24 |
12,623,837 |
ICICI Lombard General Insurance Company Limited |
92 Nitin Jain |
Sr Vice President-II |
29-Sep-14 |
PGDBM, B.E |
52 |
29 |
2,818,964 |
Cipher Capital Advisors Pvt Ltd |
93 Ravi Santhanam |
Exe. Vice President |
01-Mar-17 |
PG Diploma, B.E |
47 |
24 |
1,154,682 |
Vodafone India |
94 T V N Raghuram* |
Senior Vice President - I |
09-Oct-98 |
B.Com |
48 |
28 |
9,989,208 |
Times Bank Ltd |
Notes:
1. Remuneration shown above includes basic salary, allowances, performance bonus, cash
allowances in lieu of perquisites or taxable value of perquisites, if availed as computed
as per Income-tax rules but excludes Gratuity, PF settlement, Super Annuation settlement,
Perquisite on ESOP & Super Annuation perquisite.
2. All appointments are terminable by one / three months' notice as the case may be on
either side.
3. The above list does not include Employees sent on Deputation whose salary is
reimbursed by the other company.
4. 'Employee in overseas location.
5. None of the employees listed above hold 2% or more of the paid-up share capital of
the Bank as at March 31,2017.
6. Other than Mr. Aditya Puri, Managing Director who holds 0.13% of the paid up share
capital of the Bank, the shareholding of the employees listed above does not exceed 0.05%
of the paid up share capital of the Bank as at March 31,2017.
7. None of the employees listed above is a relative of any director of the Bank.
|