Chairman VJ Joseph-South Indian Bank Addressing Shareholders South Indian Bank has again proved its overall stability and strength. We are again equipped with solid balance sheet ratios having pursued a generally prudent and cautious business policy ,once again confirming our enthusiasm to maintain steady and consistent growth. This performance reported by the Bank is encouraging and it demonstrates our continuing commitment to delivering sustainable results .I thank our valued clients and our colleagues most sincerely for their confidence and dedication. We know that "a Trustee is an individual or corporation named by an individual, who sets aside property to be used for the benefit of another person, to manage the property as provided by the terms of the document that created the arrangement". So Banks as trustees have a sacred duty to manage the funds of the public placed with them .It is this conviction which has been guiding our beloved institution for the past 80 years .May I assure our esteemed clients that we will continue to prove worthy of the confidence reposed in our beloved organization ? I am also glad to inform you that last week the Oscar Award Winner Mr. Resool Pookutty has launched our service for NRIs of the "New Pension System" recently started by Govt. of India which is being implemented by Pension Fund Regulatory & Development Authority (PFRDA). The "New Pension System" is the ideal scheme for the NRIs to promote security of their income in their old age. NPS is open to NRIs who continue to hold Indian passport. The contribution should be in Indian rupee. This scheme will empower a subscriber – NRI or Resident – to plan his/her retirement and pension. It not only will help them save for life after retirement but also is a good investment tool. The contributions for the scheme, which is open to anyone from 18 years to 55 years of age, can be made only till the 60 years and pension will start at the age of 60 years. I am also happy to inform you that our Bank is the largest service provider of NPS in India having more branches authorized by PFRDA than any other bank. Our Bank has launched a novel Savings Bank account exclusively for women called , "SIB: MAHILA'.This packaged savings bank product is linked with recurring deposit with 'house-to-house' travel insurance (including insurance cover against chain snatching, inter alia ) for Rs .0.50 lac and accident death insurance cover for Rs. 1.00 lac –the cost of premia for both being borne by the Bank for the first year and a host of ten technological products/services provided free of cost. This has been mainly designed for our NRIs who are concerned about their spouses . Patrons, you would have noticed that the Reserve Bank of India, in its monetary policy, has decided to set provisioning for non-performing assets (NPA) at 70%. The RBI proposal means that banks will have to set aside a bigger slice of their earnings for a non-performing loan, even if the borrower may not eventually default. Banks with lower NPA coverage ratios will find it difficult to achieve the target, if it becomes a rule, in the stipulated time of four quarters. Fortunately ,our bank has achieved, as on 30/09/2009 , 66.74 % provisioning coverage for non-performing assets (NPAs) against the new RBI requirement of 70% to be achieved by September 2010 . Our Bank could contain fresh NPAs and recover Rs.169.15 crore against the Half-yearly Recovery Target of Rs.144.00 Crore, thereby already achieving 75 % of the Annual Recovery Target of Rs.225.00 Crore in September 2009 itself .The Bank could also reduce the Net NPA to 0.43 % as on 30/09/09 from 0.68 % as on 30/06/09.We are confident that we can maintain the hard-earned title of 'Best Bank in Asset Quality' in the private sector-which includes the new generation as well as the traditional Banks- at a time when banks are concerned over the creeping of NPAs into the balance sheets. To achieve that objective , we always do remember :"we are only trustees(not owners) of the funds of the public placed with us and also that as trustees we have a sacred duty to manage the funds of the public placed with us".
Safe Harbor Statement:
Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints.
Nothing in this article is, or should be construed as, investment advice.
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