A REPORT ON

THE CO-OPERATIVE BANK

OF RAJKOT LTD.
(RAJ BANK)

Submitted To :
GUJARAT TECHNICAL UNIVERCITY

Submitted By :: -
MODI NIRAJ
(M.B.A)

Guidance :: -
MR. NIRAJ PANDYA

Academic Year :: -
2005-2006

College :: -
H.N SHUKLA COLLEGE
RAJKOT.

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 PREFACE
Practical training is the part of our study in M.B.A it is
compulsory for each student to take training for 45 days in any
service sector and prepare the project report on that service
sector.

The training has been undergone at “THE CO-

OPERATIVE BANK OF RAJKOT LTD.” for the knowledge of
practical study of unit. This report contains the true knowledge
and all the aspect over gone in the practical. It covers all the
various department like marketing department, financial
department and personnel department.

“THE CO-OPERATIVE BANK OF RAJKOT LTD.”

“Sahkar Sarita” Panchanath Road, Rajkot – 360 001. Phone :
(0281) 2224120 / 2234733 / 2233155. Fax : (0281) 2236682.
E–mail : raj bank.

I have prepared the report of “THE CO-OPERATIVE

BANK OF RAJKOT LTD.” on the basic of information, which I
collected from various department of the company. I got all the
information, which I wanted from this company.

DATE :: - ___________
PLACE ::- ___________

(SIGNATURE)

MODI NIRAJ

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 ACKNOWLEDGEMENT
The preparation of the report is my own work, but I have
taken help from many persons. I am thankful to all those persons
who helped me in activity out this work.

I express my deepest of gratitude the manager of “THE

CO-OPERATIVE BANK OF RAJKOT LTD.” and all the
members who provided all the necessary information.

He gives me grate pleasure in thanking Mr. NIRAJ PANDYA

who helped me out in my work. Without him ever ready help,
whole hearted guidance, never ending encouragement and
enthusiasm. It was difficult to bring this report to its present form.

I would be failing my duty if I will not mention thanks to

family members, relatives and friends to helping me throughout.

DATE :: - ___________
PLACE ::- ___________

(SIGNATURE)

MODI NIRAJ

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 DECLARATION
I, the undersigned MODI NIRAJ student of M.B.A. from
the Shri HNS COLLEGE of Commerce & Business management
& Computer studies, declare that this project report is prepared
taken a help of my college and professor for the purpose of
guidance only and to add that, myself prepare this report.

DATE :: - ___________
PLACE ::- ___________

(SIGNATURE)

(MODI NIRAJ.)

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 CONTENTS
Preface 2

Acknowledgement 3

Declaration 4

Banking Sector In India 9

General Information Of Co-Op. Banks 11 - 19

 Introduction 12

 Definition Of Co-Operative 13
 Principles & Characteristics 14
 Types Of Co-Operative Bank 16
 Role Of Co-Operative Bank 18
 Registration & Licensing 19

RAJ BANK At Glance 20 - 32

 Introduction 21
 Corporate Mission 22
 The Executive Committee 23
 Branch Network & Structure 24
 Awards & Accolades 29
 Corporate Governance & RAJ BANK 30
 Relationship Management 32

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Services At The RAJ BANK 34 - 52
 Introduction 35
 Depository Services 36 - 42
 Current Deposit 36
 Saving Deposit 38
 Term Deposit 40
 Recurring Deposit 41
 Children Deposit 42

 Advance Services 43 - 49
 Business Loan 43
 Medical Equipment Loan 44

 Term Loan 44
 Mortgage Loan 45
 Secured Overdraft 45
 Clean Overdraft 46

 Personal Loan 46
 Vehicle Loan 47
 Loan against NSC / KVP / LIC. 48
 Home Loan 49

 Other Services 50 - 52

 Safe Deposit Vault 50

 Cash – Card Facility 51
 ATM Facility 52
 Cheques Depository Service 52

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H. R. M. At The RAJ BANK 53 - 63
 Introduction 54
 Human Resource Policies & Program 55
 Recruitment 57
 Selection 58
 Orientation & Placement 59
 Employee Remuneration 60
 Training & Development 62
 Promotion & Transfer 63

Marketing At The RAJ BANK 65 - 68

 Introduction 66
 Promotional Activities 67
 Marketing Research & Information 68

Finance Management At The RAJ BANK 69 - 81

 Introduction 70
 Financial Planning 71
 Capital Structure Of The RAJ BANK 72
 Capitalization 73
 Cash Management 74
 Ratio Analysis 75
 Finance Information 76
 Progress Report 77
 NPA & Recovery Management 79
 Risk Management 81

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S. W. O. T. Analysis 83
Future Plan 86
Suggestion 88
Conclusion 90
Bibliography 92

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Bankin
g
Sector
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 In
India

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 BANKING SECTOR
IN INDIA
The importance of banking as the nerve sector of economic
development can not be over emphasized. Banking industry has
acquired a key position in mobilizing resources for defense & for
socio economic development of the country. It is said that “Bank
which are that need of & great wealth of our country have got to
be kept very sacred. Just as water is for irrigation, good banks are
for the country’s industry & trade.” Since the beginning of
planning in India banking industry has grown not only in size but
also in depth this industry has become one big complex.

Today banks have become a part & parcel of our life. Ti was
the time when the dwellers of city alone could enjoy their
services. Now banks offer access to even a common man & their
activities extend to areas hither to untouched & after the
globalization & liberalization policy of India, many foreign banks
have entered in Indian market with different services &
innovation technologies. Apart from their traditional business
oriented functions, they have now come out to fulfill national
responsibilities. Today’s banks cater to the needs of agriculturists,
industrialist, traders, women, students & to all other sections of
the society. Thus they accelerate the economic growth of a
country & steer the wheel of the economy towards it’s goal of
“Self reliance in all fields.” Hence today banking sector has
become the lifeline of the economy.

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 In present age in India there are many banks including
foreign banks, public sector, private sector, commercial banks &
co-operative banks.

General
Informatio
n of
Co-
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Operative
Banks

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 INTRODUCTION
Over the year the difference between co-operative banks &
commercial banks has blurred as they all have come under a
common law. All products & services are offered by co-operative
banks are on the par with commercial banks, with a few
exceptions related to government business. In 1904 the co-
operative movement started in India with a view to provide
finance to the agriculturist at a low rate of interest. The co-
operative society has to take the place of the money lenders &
provide cheap loan to the farmers for productive purposes. Even
though many types of co-operative societies have been started
particularly for the artisans & others, the most common form of
such societies deal in rural credits. And today co-operative banks
have started verities of services with different technologies. Once
the Mahatma Gandhiji has remarked that “there is sweetness in
co-operation; there is no one who weak or strong among those
who co-operate. Each is equal to other.”

So, after having such easy government policy, today many

co-operative banks have started in India. And they are catering to
the all section of the society, & also today co-operative sector has
grown in all over the world, with globalization of the world they
have also started to implement new technologies & various
management tools. Now, they are in same market with all the
other banks. So, by this way the co-operative banks are in the key
position in the economy.

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 DEFINITION OF
CO-OPERATION
Co-operation has been defines in slightly different ways in
various sciences & by various scholars. This is due to its flexible
nature which can lend itself to variety of purpose & social system,
in order to have a through understanding of the concept some
well known definitions are discussed below.

“Co-operation is a form of organization where in persons

voluntarily associate together as human beings on a basis of
equality, for the promotion of economic interests of them selves.”

-Hubert Calvert

“Another protagonist is an association for the purpose of

joint trading, originating among the weak & conducted always in
an unselfish spirit, on such terms that all who are prepared of
assume the duties of membership my share in it’s reward in
proportion to the degree in which they make use of there
association.”

- C. R. FAY

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 PRINCIPLE &
CHARACTERISTICS

Careful analyses of the above definitions will reveal the

following principles & characteristics of co-operative organization.

 VOLUNTARY ASSOCIATION ::-

Co-operative organization is purely a voluntary association if

individual who join together for betterment of their economic
interest through collective efforts. A member is at liberty to leave
the organization at any time & withdrawal his capital by giving
due notice. But it should be remembered that a member is not
allowed to transfer his shares to another person as found in the
company organization.

 OPEN MEMBERSHIP ::-

Membership of co-operative organization is open to all

irrespective of religion caste, colour, creed, political affiliations
belief & status to which a person belongs. The membership fees
& the entrance fees are kept relatively low so as to enable the
economically weak to become the members.

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 EQUAL VOTING RIGHTS ::-

Equality is the quintessence of co-operative organization.

Members have equal voice in the management of it’s affairs with
the underlying principle “ ONE FOR ONE VOTE .“

 SERVICE MOTIVE ::-

It is mainly intended to goods first to it’s members & then

to outsiders at profit the primary aim of any co-operative
organization is to render service to its member. So these are the
primary motive or principles. There are other principles, co-
operative organization has to follow those principles like state
control, democratic organization etc.

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TYPES OF
CO-OPERATIVE BANKS
There are mainly three types of co-operative banks
in India.
State co-operative banks
Central co-operative banks
Urban co-operative banks

 STATE CO-OPERATIVE BANKS ::-

These banks are also known as apex bank & are registered
under co-operative societies act – 1912. In fact these banks are
established to function as a leading co-operative financial
institution of the state offer co-operative societies should grow.
The “apex banks “as they are called are they to render financial
help as & when the co-operative societies are in need of their
help.

 CENTRAL CO-OPERATIVE BANKS ::-

A district level of central co-operative banks is functioning

as a commercial bank & that too as an independent unit. They
are there in order to strengthen the co-operative movement in the
country. In fact these banks are the key link between people &
apex bank & render valuable services to downtrodden & rural folk
in taking them out of the financial wood central co-operative
banks get funds from

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(A) share capital (B) deposits (C) financial help from state co-
operative banks (D) state bank of india & (E) commercial banks.
Their working capital is usually provided by state government.

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 URBAN CO-OPERATIVE BANKS ::-

Urban co-operative banks are organized & established in

towns on the pattern of joint – stock banks but are established
under co-operative societies act – 1912. For funds these banks
depend on their own sources. However central co-operative banks
are helping them in financially viable. Central co-operative banks
are directly links with the state co-operative banks. Urban primary
co-operative banks provide funds to rural folk in easy terms to
help them in agriculture work aid its development today they
have started playing a significant role in rural upliftment. They are
in tune with the government policies & program.

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 ROLE OF
CO-OPERATIVE BANKS

Now-a-days co-operative banks are progressing very fast

then any commercial or nationalized banks. The customer service
lending services & other banking facilities given to the society is
being better than other banks. So people are also being attracted
& interested in co-operative banks.

The main aim of the bank is to extend credit facilities to the

small traders, workers & other middle class people. This bank
derive their funds for working partly through share capital
contributed by the members & partly through deposits collected
from members, general public & render usual banking services.
The liability of members is normally unlimited. This enables the
society to raise funds from outside agencies & also encourages
member to take keen interest in working of the society.

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 REGISTRATION &
LICENSING
There should be co-ordination between the state co-
operative department & RBI for the registration & licensing of
urban banks. Urban banks should build up their share capital &
reserve to the revised minimum level with in period of 3 year
which can be extendedly by the RBI to a further period of 2 years
whenever necessary.

For organization or urban co-operative bank in each state

there should jointly survey local areas & identify the potential
growth centers where urban banks could be organized once such
centers are located prominent person of the locality might be
contacted to seek their assistance for registration of the urban
banks. New banks are to be organized in backward areas or by
weaker section of the community may not be able to collect the
initial minimum share capital required for obtaining license.
Government assistant in the form of share capital contribution for
such new banks may be equal to that collected by members.

These banks derive their funds for working partly through

share capital contributed by the numbers & partly through
deposits collected from members & non-members & renders
usual banking services. The shares are of higher value. But the
liability of the member is limited to the extent to the shares hold
by them.

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Raj
Bank
At A
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Glance

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 INTRODUCTION

The co-operative bank of Rajkot ltd. popularly known as Raj

bank is established on 25 - 11 – 1980 under the strong, effective
leader ship of one of the national co-operative hero honor Shri
Ramnikbhai Dhami with the intention of survive the common
man.

The local intensity of the bank in it’s customer centric

approach, hassle free execution of the decision & technologies
are their main difference from commercial banks, also high level
of commitment at all levels of management & self committed
ground level staff makes them different from other commercial
banks.

At present Raj bank has achieved a key position in the

market of saurashtra. It has 11 branch in all over Saurashtra
including main branch with the advanced technologies and
educated staff, as it it said that “In the emerging competitive
business environment Co-operative banks who adhere to strict
Financial discipline. Only will survive” On this basis at present Raj
bank is becoming more prestigious in the banking sector.

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CORPORATE MISSION
Survive to the common man.
Enhance the value of share holders.
Emerge as a symbol of public trust & confidence by
creating a positive image.
Maintain excellence in operation & management by
bringing in transparency & integrity.
Develop & motivate human resource there by cultivating
professional culture in the banking operation.
Ensure speedy & satisfactory customer services through
continuous product innovation & aggressive marketing
strategies.
And the last but not least that is….
“To assist the weaker section of the society” Is the
primary motto of the Raj Bank.

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 THE EXECUTIVE
COMMITTEE
Sr. Designation Name Occupation
1 Chair Man Ramnikbhai Sejpal Industrialist

2 Vice Chair Man Bhanjibhai Patel Industrialist

3 Managing Director Ramnicbhai Dhami Advocate

Joint Managing ------

4 Kamalbhai Dhami
Director

Satyaprakash
5 General Manager ------
Khokhara

6 Director Kiritbhai Kamdar Architect

7 Director Manubhai Nasit Industrialist

8 Director Manharbhai Shah Businessman

9 Director Chandubhai Pamphar Charted Eng.

10 Director Jamnadas Faldu Industrialist

Chandrakantbhai
11 Director Industrialist
Patel

12 Director Govindbhai Khunt Businessman

13 Director Dr. Vallabhbhai Hirani Doctor

14 Director Gopalbhai Karia Businessman

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15 Director Shsikantbhai Maheta Builder

16 Director Shirishbhai Dhruv Engineer

17 Director Madhusudan Donga Industrialist

18 Director Muljibhai Chauhan Govt. Contractor

19 Director Bakulbhai Zalavadia C. A.

20 Director Lilaben Dhami Social Worker

21 Director Arunaben Chudasama Social Worker

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 BRANCH NETWORK &
STRUCTURE
1 Panchnath Road Branch ( With ATM)
“Sahkar Sarita” Panchnath Road Rajkot – 1.
Phone : 2233722, 2234454
At Your Service From : 25–11–1980
( RBI Licence No. ACD.Gj.219 Dt :- 12–08–1980)

Mr. D. M. Dave Manager

Mr. S. K. Makwana Dy. Manager
Mr. N. S. Patel Dy. Manager
Mr. S. M. Kalyani Asst. Manager
Mr. K. D. Dalsania Asst. Manager

2 Dhebarbhai Road Branch

Near Trikon Baug, Rajkot – 360 001.
Phone : (0281) 2236766, 2227948
At Your Service From : 10-04–1989
( RBI Licence No. UBD.BL 1937 Dt. 26–10–87)

Mr. B. P. Vekaria Manager

Mr. U.S. Padalia Asst. Manager
Mr. J. C. Solanki Asst. Manager

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3 Saurashtra Uni. Road Branch (With ATM)
Saurashtra Uni. Road, Rajkot – 360005
Phone : (0281) 2573600, 2573601
At Your Service From : 05–04–1993.
( RBI Licence No. UBD. AH/4 Dt. 12–08–1994)

Mr. R. S. Boda Manager

Mr. V. N. Maheta Asst. Manager
Mr. N. R. Boda Asst. Manager
Mr. V. H. Chavda Asst. Manager

4 Jasdan Branch
Jeram Plot, Chitalia Kuva Road,
Jasdan – 360050. Phone : (02821) 220830.
At Your Service From : 16–01–1996.
( RBI Licence No. UBD. AH/95 Dt : 09-08-1994)

Mr. H. T. Joshi Asst. Manager

Mr. Z. P. Kalkani Asst. Manager

5 Morvi Branch
1, Kalika Plot, Ravapar Road,
Morvi – 363641, Phone : (02822) 230920.
At Your Service From : 05-06-1995
( RBI Licence No. UBD. AH/96 Dt : 09-08-1994)

Mr. S. V. Patel Dy. Manager

Mr. M. C. Vadaviya Asst. Manager

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6 Jetpur Branch (With ATM)
Kanakai Plot, Jetpur -360 370
Phone : (02823) 223151.
At Your Service From : 16-01-1996
( RBI Licence No. UBD. AH/94 Dt : 09-08-1994)

Mr. M. K. Sheth Dy. Manager

Mr. V. K. Siddhpara Asst. Manager

7 Upleta Branch
Raj Marg, Upleta – 360 490
Phone : (02826) 222955.
At Your Service From : 15-01-1999
( RBI Licence No. UBD. AH/334 Dt : 19-06-1997)

Mr. S. M. Virapara Asst. Manager

Mr. R. J. Lunagaria Asst. Manager

8 Gondal Branch
Kailash Complex, Kailash Baug,
Gondal – 360 311. Phone : (02825) 223143
At Your Service From : 15-01-1999.
( RBI Licence No. UBD. AH/348 Dt : 25-09-1997)

Mr. H. J. Pipariya Asst. Manager

Mr. R. M. Chuhan Asst. Manager

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9 Sahakar Society Area Branch
Hasan Wadi Main Road, Nr. Trishul Chowk,
Rajkot – 360 002. Phone : (0281) 2363536
At Your Service From : 26-01-2002.
( RBI Licence No. UBD. AH/610 Dt : 10-08-2001)

Mr. K. R. Viradia Dy. Manager

10 Raiya Raod Branch

Omkar Towers, Opp. Nirmala School.
Rajkot -7. Phone : (0281) 2589494.
At Your Service From : 27-01-2002.
( RBI Licence No. UBD. AH/608 Dt : 10-08-2001)

Mr. D. V. Maheta Manager

11 Junaghar Branch (With ATM)

“Sardar Bhavan” Maharshi Arvind Marg,
Junaghar – 362 001. Phone : (0285) 2621313
At Your Service From : 31-10-2003.
( RBI Licence No. UBD. AH/642 Dt : 28-05-2003)

Mr. Sarfaraz Munshi Asst. Manager

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AWARDS & ACCOLADES

1) “Zero NPA” excellence bank award given by

Mr. Ghanshyambhai Amin

2) Sahkar Ratna award to managing director

Mr. Ramnikbhai Dhami given By
Mr. Jayrambhai patel & Mr. Vallabhbhai Kathiriya

3) From beginning Raj bank has been awarding

As Audit calls “A” By district register.

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 CORPORATE
GOVERNANCE & RAJ
BANK
As Co-operative banks come under common law but then
also the banks have to follow such guidelines of the RBI. The
prudential measures have been stipulated by RBI for the urban
co-operative banks according to which the position of Raj Bank is
as follow.

Prudential norms of RBI Raj Banks position

Capital adequacy ratio is to Raj Bank has maintain this
Maintain at 9%. Ratio at more then 31%.

Prohibition on advance Raj Bank has never made

Being made to share booker. Such advances.

Prohibition on advance Raj Bank has never made

against shares & debentures. Such advances.

Maxi. 2% debt can be Raj Bank has never borrowed

Obtain from call money any debt from call money
Market (This 2% will be on market from the date of
the deposit of the P. Y.) incorporation.

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Prohibition to keep fix deposit Raj Bank has never maintain-
With other urban co-op. bank. Ed fix deposit with any other
Urban co-op. bank.

It is compulsory for non- Raj Bank’s investment in

Scheduled co-op. bank such type of security is
To invest 15% of NDTL in more then 25%.
Govt. approved securities.

Scheduled co-op. banks Inspite of Raj Bank is

should compulsorily invest non-scheduled bank, it's
25% in govt. & other investment in such
approved govt. securities. Securities are more then 25%.

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 RELATION SHIP
MANAGEMENT
The importance of relationship can not be measurable in
our life. In our life we have to maintain such relation, we can not
across it. In earlier we use to call it maintenance for relation but
now a days it is being called as relationship management.
Without maintaining relation, firm can not go further or can not
get development. Because without customer or employee, who
will give importance to the organization. But an organization
needs to keep its eye on every side and need to manage every
relation. For every organization there are main three relations
such as customer relation, employee relation and social relation.

 EMPLOYEE RELATION

To provide best service to customer it would be difficult task

for Raj bank if there would not proper human resource
management. In success of any organization, relationship
between employee and employee, employee and management
employee and labours etc. should be good. Raj bank takes care
it’s employee just like a family member. And not only looks after
their intelligence but also takes care of there emotional and
spiritual quotient. Bank has maintain healthy relation with there
employee, bank also tries to satisfied there need.

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 SOCIAL RELATION

Bank has maintained health relation with society also.

Society consist of other bank, government, businessman etc.
bank has to maintain good relation with societal factor. So by this
way for Raj bank relationship management is as important as
other management and as a result of good relationship
management, today bank has very strong market position and
goodwill in society.

 CUSTOMER RELATION

Raj bank believes that customer satisfaction is it’s best

reward by providing best services so customer is a king for Raj
bank. Bank always tries to maintain healthy relation with
customer.

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Service
Of The

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 Raj
Bank
INTRODUCTION
It was a time when a function of the banks limited to the
collection saving from the public & lending to the people who are
in of money. But in modern age, now it’s not like that , in modern
time banks have become the important part of colony due to the
only expansion in the function. One reason for development in
banking function is that the developing of the market means
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today’s competition & to maintain position in the market banks
they have to develop their services. The modern function or the
services provided by the banks are as follows.

To collect spare funds from people’s saving & pay them

interest.
To make these funds available to the businessman &
industrialist as loan & advance. They charge interest from
them.
They also help in assisting international trade by arranging
exchange of currency to another one.
Banks render services for the welfare & development of
weaker section of the society, they help in setting up small
industries, cottage etc.
Banks help farmer to buy tractors & other agricultural
equipments, middle class people to buy home appliances
like T. V. & provide finance for house.

In RAJ Bank out of these services most of services are being

served. Not only that but also they are providing ATM facility, Cash
card facility, Demand draft facility & many other services.

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 CURRENT DEPOSIT
Current account refers to regularity of transecting in
account with in banking hours on all working day. The banker’s
liability in this regard is to honor all the demand of the customer
to the extent to which his account shows a credit balance. It is
because of this obligation current account deposit is known as
bankers demand liability & in order to fulfill this liability they
keeps sufficient cash ready every moment.

A current account is an account which is generally opened

by businessmen, companies, institutes, corporations,
industrialists etc.

Who have huge working capital in their hand.

Who are interested in keeping money safe.
Who transect with their banker daily.
Who received and make payment usually through cheques.
Who utilize the agency services of the banker frequently
Who are engaged in large scale business activity, social
services and government activities.

At present in RAJ BANK the condition of

current account is as under.

No. of depositors total deposit amt. % of total deposit

10,748 30, 32, 78,368.52 10.59%

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 Features of the current account And Facilities
provided to the current account holder.

Easy Procedures for account opening.

24 hours banking facility through their ATM centers.
Personalized services & special facility by the way of
telephonic inquiry.
Regular bank statement is provided at home through post or E-
mail.
Special facility of over draft cleans O.D. & secured O.D.

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 SAVING DEPOSIT
Saving deposit account is an ideal account or those who
2have money to save but who can not advantageously invest
them any where else as their saving are not of much significance
to the capital market because their saving are too small. This
amount is therefore meant of smaller saver. The account is
therefore encourages small saving and tries to forge a saving
habit in the general public. The attitude to save is important
which this account tries to create and thus mobilize such small
savings for greater social good saving deposits account is for that
section of society and put to fruitful utilization.

 Features of the saving deposit

Restriction on with drawl of amount.
Restriction on deposit of amount.
Payment of interest.

At present in RAJ BANK the condition of

saving deposit is as follows.

No. of depositors total deposit amt. % of total deposit

50,314 71,23,43,463.83 24.87%

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 Extra features to the saving account holder of
the Raj Bank.
Attractive Rate of interest (3.5%)
Easy procedure for account opening.
24 hours banking facility through their ATM centers.
Personalized services & special facility by the way of
telephonic inquiry.
Regular bank statement is provided at home through post
or E-mail.
Attractive computerized passbook.
No charges for saving account holder.

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 TERM DEPOSIT
This account attracts those customers who have money
invest for a longer period but do not want to take much of risk.
Such person prefers to deposit with commercial banks for a
specified period at a specified rate of interest. The interest rate
varies from one period to another. A deposit of 15 days attracts a
smaller rate of interest and deposits for 5 or more years. The
highest rate of interest. The period for which deposits are to be
made depends upon the depositor himself. However, once a
decision is taken by the depositor any money deposit usually he is
not allowed to withdrawal the same before the interest earned till
that date or accepts a lower rate of interest than stipulated at the
time of deposits.

At present in RAJ BANK the condition of the term deposits is as

under.
No. of depositors total deposit amt. % of total deposit
77,750 182,84,67,000.00 63.84%

 Interest rate structure on fixed deposits.

No. of % of total
Between Total deposit amt.
depositors deposit
6% to 8% 40,626 49,70,61,053.63 17.35%
8% to 10% 17,997 68,02,61,362.86 23.75%
10% to 12% 15,365 50,57,25,251.47 17.66%
above 12% 3,755 14,54,19,938.10 5.08%

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 .

RECURRING DEPOSIT

To encourage regular saving habits in the depositing public

the bank in the country provide an opportunity to them to save
regularly. According to their capacity and need and earn more
than what saving deposit accounts offers to them. The following
are the main features of the recurring deposits.
The deposits are made every month of fixed amount say
Rs. 5,10,15,25 and so on.
The deposit is made for fixed period say 6,
12,24,36,48,60,72,84, months and so on.
The account can be transfer from one bank to another in
the country on request by customer.
This account can be opened by every one competent to
enter in to contract including the minor one.
A passbook is supplied to the customer and entry is made
there in every month after every deposit.
The account attract higher rate of interest.
The customer is allowed to raise loan against his recurring
deposit account to the maximum limit of 75% of the
deposit he has made till the date of raising the loan.

As far as concerned with recurring deposits at the Raj Bank,

than these are the features are the provided to the recurring
deposit holders.
Easy and simple account opening procedure.
Speedy and timely services.
Account can be opened with any convenient amount,

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 Attractive rate or interest and special rate for senior
citizenship.

CHILDREN DEPOSIT
The main purpose of such account is to develop a habit of
saving in student community. The main features of this account
are as follows.
The student can deposit a minimum of paisa.
The bank’s branch is usually operated in the school
premises.
The student may withdrawal the money as and when they
choose to do so.
On a balance of Rs.5 and above interest at saving deposit
account rate is allowed.

Features of the children deposit scheme at the

Raj Bank.

A special scheme for school and college students.

Attractive rate of interest.
Special gift will be provided to them on extra ordinary
performance in academic and other curriculum activities.
No withdrawal will be allowed from such account point to
maturity.
Attractive passbook will be provided with their printed
name on it.

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 BUSINESS LOAN
Any kind of traders, businessmen or a person, who is going
to start a new business, can get business loan. Bank grants
business loan for the purpose of fulfillment or short term working
capital need in the business.

Bank grants this type of loan Rs. 2 lacs to maximum 25

lacs. Bank charges rate of interest as under.

CREDIT RATING ROI

Prime BLPR + 00.00%
AAA BLPR + 00.25%
AA BLPR + 01.25%
A BLPR + 02.25%
 BPLR 10.75% w.e.g. 01-08-2004

A person who is gating business loan he has to mortgage

land, building or any other fixed assets.
Document of properties have to be given to the bank by a
person. Bank takes all these documents as a security.
A person has to give reference of two people who are
depositor in the Raj Bank as guarantors.

 NECESSARY DOCUMENTS ARE…

Application form, other documents specified in the

application form, if applicant want mortgage than he need to

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submit the whole file of that assets valuation report of that
assets. Proof of guarantor’s income (one time only).

MEDICAL
EQUIPMENT LOAN
Any registered medical practitioners whose age should be
25 years to 55 years and should have at least one year
experience.
Purpose of this loan is to build a new clinic, to purchase
other medical equipments or any property for clinic.
Bank grants this loan up to 3 crores.
Rate of interest charged on this loan is 10% to 11%.
As a security a person has to mortgage any fixed assets
whose reliable market value is enough in proportion of loan.
Loan repayment period is maximum 6 years.

TERM LOAN
It is one of the major sources of debt finance for a long
term project. Term loans are generally repayable in more than a
year but less than 10 years. These loans are offered by all Indian
financial institutions. Term loans are generally secured through a
first mortgage or by way of deposit of title deeds of immovable
properties.
Any business operator for the purpose of purchase
necessary building, build a building or purchase a new
machinery.
For the purpose of this loan is to invest in long term capital.
Bank grants these loan 2 lacs to 25 lacs.
Rate of interest charged on this loan is 10% to 13%.

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 As a security a person has to mortgage any fixed assets
whose reliable market value is enough in proportion of loan.

MORTGAGE LOAN
Any kind or traders, businessmen or an industrialist can get
mortgage loan. Bank grants mortgage loan for the any
purpose.
Bank grants this type of loan Rs. 50,000 to maximum 10
lacs. Bank charges rate of interest on this loan is 12.5% to
13.5%.
A person who is gating mortgage loan he has to mortgage
land, building or any other fixed assets.
Document of properties have to be given to the bank by a
person.
A person has to give reference of two people who are
depositor in the Raj Bank as guarantors.
Loan repayment period is 3 years to 7 years.

SECURED OVERDRAFT
Any kind of traders, businessmen, personally, professional
& industrialist can get secured over draft.
Bank grants secured overdraft for the purpose of fulfillment
or short term working capital need in the business.
Bank grants this type of over draft Rs. 1 lacs to maximum
100 lacs. Bank charged interest on this over draft is
10.75% to 14%.
As a security a person has to mortgage any fixed assets
whose reliable market value is enough in proportion of over
draft.

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A person has to give reference of two people who are
depositor in the Raj Bank as guarantors.

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CLEAN OVER DRAFT
Any kind of traders, businessmen, personally, professional
& industrialist can get clean over draft.
Bank grants secured overdraft for the purpose of fulfillment
or short term working capital need in the business.
Bank grants this type of over draft Rs.50, 000.
Bank charged interest on this over draft is 12%.
As a security a person has to mortgage any fixed assets
whose reliable market value is enough in proportion of over
draft.
A person has to give reference of two people who are
depositor in the Raj Bank as guarantors.

PERSONAL LOAN
Any localize person can get this loan.
Bank grants personal loan for the purpose of purchase
fridge, T. V., washing machine or any other thing which
can be useful for home management.
Bank grants this type of loan Rs. 10,000 to maximum
50,000 or 70% to 90% of the quotation price of the
product.
Bank charges rate of interest on this loan is 11%.
Applicants need to make such documents of purchase
products of purchased product in favor of the bank as a
security.
A person has to give reference of two people who are
depositor in the Raj Bank as guarantors.
Loan repayment period is 3 years to 5 years.

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 VEHICLE LOAN
Any kind of traders, businessmen, personally,
professional or any person can get this type of loan.
Bank grants personal loan for the purpose of purchase
old or new vehicle for personal or business use.
Bank grants this type of loan Rs. 15,000 to maximum
10, 00,000 or 70% to 90% of the quotation price of the
product.
Bank charges rate of interest on this loan is 11%.
Applicants need to make such documents of purchased
vehicle in favor of the bank & in RTO applicant need to
register as a hire purchased vehicle as a security.
A person has to give reference of two people who are
depositor in the Raj Bank as guarantors.
Loan repayment period is 3 years to 7 years.
Quotation of vehicle, proof of guarantor’s income (one
time only), RTO certificate & other documents are required
with the application form.

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 LOAN AGAINST
NSC, KVP, LIC.

Any person who should have share certificate on his own name
or any LIC policy holder.
Bank grants loan for any purpose.
Bank grants this type of loan 70% to 90% of the price of the
NSC, KVP, LIC.
Bank charges rate of interest on this loan is 11.50%.
Applicant need to give share certificate or LIC policy.
Applicant has to repayment this loan within the due date of
that certificate or policy.
Application form, other documents specified in the application
form and if an applicant has to give Share certificate or
policy than need to sign in favor of the bank.

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.

HOME LOAN
Any localize person can get this loan.
Bank grants personal loan for the purpose of purchase or to
build home.
Bank grants this type of loan Rs. 15,000 to maximum
15,00,000 or 70% to 90% of the price of the home.
Bank charges rate of interest on this loan is 11.50%.
Applicants need to make such documents of purchased home
in favor of the bank & bank takes all the documents as a
security.
A person has to give reference of two people who are depositor
in the Raj Bank as guarantors.
Loan repayment period is 3 years to 15 years.
Application form, other documents specified in the application
form and if an applicant want to mortgage any assets than
he need to give whole file of that assets and title report
through advocate approved by bank only proof of
guarantor’s income (one time only).

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 SAFE DEPOSIT VAULT
 Safe Deposit Vault (locker facility)

At Raj bank there is a proper locker department at ground

floor here locker facility has been providing to the customer.
Customer can keep all the ornaments, important documents and
many other papers and many things. For every bank this facility is
become just like primary function and for providing best customer
service Raj bank is managing this service too.

Any shareholder or depositor can easily get their personal

locker of bank. There are mainly three types of lockers at Raj
bank Small size locker, Medium size locker, and large size locker.
And for to maintain best services Raj bank has different
department and enough staff for locker department. Different
charges and deposits for different locker are as under.

Types of locker Yearly rent Deposit

Small 200 5000
Medium 250 10000
Large 300 15000

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 And for the management of this locker
department they are mainly follow these activities.

They have locker attendance register in which the

identification, address, full name and signature of locker
holder are being maintained.
Before any locker holder open his/her personal locker the staff
member has been verifying the signature of that parson
and than they allow him to open locker.
They are also maintained time register in which the entry time
and exist time a locker holder is being written. So this is
very essential function for Raj Bank.

CASH CARD FACILITY

Cash card facilities totally new and plastic product is started
by only Raj bank among the nation by cash card any customer
can every with drawl amount up to Rs. 15000 from ATMs by cash
card. There are no charges for cash card and in also one silent
feature is there is no minimum balance require for cash card
system. It is a unique facility of Co-Operative bank of Rajkot ltd.
Cash card is given instead of token for the payment of cheques.

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 ATM FACILITY
ATM has given a new dimension to banking by giving rise to
self service banking. Customer have long been constrained by
conventional banking services which have been characterized
generally by fixed location and fixed timing on the other hand.
Customers not desiring to keep much money on them expect
their money to be available to them. Whenever and wherever they
need money, 24 hours banking services is available for any time.
ATM can be used for withdrawal of cash. For Raj bank it is a
matter of great proud that it is pioneer in introducing ATM in the
entire Saurashtra region in Co-Operative banking sector. At
present Raj bank has four ATM. By this ATMs any customer can
easily withdrawal maximum 10000 per day.

CHEQUE DEPOSITORY
SERVICE
For the purpose of providing best customer service with
advanced technologies to their customer, Raj bank has also
started Cheques depository service through cheques depository
machine. This service provided to the customer 24 hours of 365
days. CDM facility started on 17th July 2004 at main branch. Now
any customer can easily deposit cheques through CDM at any

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time and any day without filling big slips and without standing in
big queue.

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H. R.
M.
At
The
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 Raj
Bank
INTRODUCTION
Human resources in any organization, be it public private of
Co-Operative constitute perhaps the most vital assets of that
organization. An organization will fail if its human resources are
not competent to execute the work assigned to them. There is no
getting away from fact that human resources represent a
subsystem which dominates all other sub system to the
organization.

Moreover, people are the only assets of an organization that

appreciate over a period of time while all the other assets
depreciate. The more an organization is investing in human
resources, the greater the return from the investment is likely to
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be and it has been rightly pointed to in one of the books of inter
national Co-Operative alliance “The gains accruing out of
structural reforms can be best capitalized only it the personnel
maintained by the Co-Operative institution are in a position to
execute the policies effectively”. This implies the need and
necessity of proficient and capable human resources which is on
e of the primary aims of ht human resource management.

According to national institute of personnel management of

india “Personnel management is that part of management
concerned with people at work and with their relationship within
the organization it seeks to bring together men and women who
make u an enterprise enabling each to make his own best
contribution to it’s success both as an individual as a working
group.”

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 H. R. POLICY AND
PROGRAMMES
A sound foundation for selection of the right kind of human
resources is laid with the formulation of sound human resources
policies. According to William R. Spiegel a human resources
policy can be defined as, “A body of principles and rules of
conduct that governs the enterprises in it’s relationship with it’s
employees. Thus the sound personnel policies set the tome for
proper administration of the personnel programmers, So as to
achieve the objective of the organization.

As Raj Bank is one of the leading Co-Operative bank in the

Co-Operative sector, though its performance is very good but than
also such policies for human resources they can not make by
their own. It has to follow the rules of policies given by the
government and RBI so in the matter of the personnel policies Raj
Bank is restricted to some level. Than also the bank have
adopted a policy of recruiting only CA and MBA for their
management level for better management. So, by this way where
they get chance they are making or improving personnel policies
at Raj Bank.

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 The next important stage in the selection process is the
human resource planning. “Planning applied in the field of
personnel” it is the comprehensive and on going process. Broadly
conceive human resource planning as Thomas H Patten Jr. states,
“Human resource planning is process by which an organization
ensures that it has right no. and kinds of people in the right place
at the right time doing the things which they are economically
most useful.”

In the Raj bank there is a very educated staff as it is

concerned with the human resource planning recently they has
adopted policy of selection only C.A. & M.B.A. For their human
resource has as far as concerned with the human resource
planning. There is no long term planning but at a time or
requirement of staff they used to recruit staff either out side or
from with in the firm through transfer or promotion.

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 RECRUITMENT
Among the function of human resource manager, one man
function is to procure best people for their organization, means
search of prospective employees to suit the job recruitment. A
firm has to pass through well and good recruitment process for
having best human resource this recruitment can be possible
through many sources. A firm can recruit proper candidate mainly
through two success recruitment sources these are as under.

Recruitment Sources
Internal sources External sources
1) Transfer 1) Advertisement
2) Promotion 2) Education institutes
3) Relative & friends 3) Placement agencies
4) Labours contractor

In case of Raj bank, the main source or recruitment is daily

news paper advertisement. They also recruit employees by
transfer and promotion. Generally as per the recruitment of the
job they give advertisement in newspaper and collect the pool of
application.

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 SELECTION
Managing people is not easy but it can be made easier if
you make sure that you have selected the right people in the first
place. And also it said that “selection of people is easy but
selection of right people is difficult task.” The selection procedure
is concerned with securing relevant information about an
applicant is secured. The objective of selection process is to
determine whether the applicant meets the qualification for a
specific job and to choose the applicant who is most likely to
perform well in that job.

Thus an effective selection program is a non random

process because those selected had been choose on the basis of
the assumption that they are likely to be “better” employees then
those who have been rejected. Selection process or activities
typically follow a standard pattern being with an initial screening
of applicant, interview and concluding with final employment
decision. The selection procedure of raj bank is quit simple. The
stages of including in the selection process are as follows.

New paper advertisement

Receipt of application

Screening

Arrangement and interview

Selection

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Placement and confirmation

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 ORIENTATION
After the selection of employee, management of the firm
has to pass through such process. So new employee can be
aware of the atmosphere of the firm and also can be familiar with
the other employee. This process is called orientation or
induction. In any organization this process performs very vital role
because this is the only process which can create better
environment in the organization and a new comer can be aware
about his working condition, his area of responsibility and
everything about organization. Proper orientation process can be
beneficial to both, a new comer as well as organization.

PLACEMENT
Once an employee has been selected he should be placed
on a suitable job. Putting the right man at the right job is as
important as hiring the right person. Placement is a process of
assigning a specific job to each one of the selected candidates. It
involves assigning a specific rank of and responsibilities of an
individual. It implies matching requirement of a job with the
qualification of a candidate.

In other words, “placement is the determination of the job

which an accepted candidate is to be assigned and his
assignment to the job.” As Raj bank is very careful about this
process. And one thing is that, at the time of requirement only
they hire new employees. So hire it is specified that for which job

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they are recruiting. After the final selection, they have been
marking the job of the new employee.

EMPLOYEE
REMUNERATION
Remuneration is the compensation an employee receives in
return for his or her contribution to the organization.
Remuneration occupies an important place in the life of an
employee. Standard of living of employee, states in the society,
motivation, loyalty and productivity depends upon the
remuneration. For the employee remuneration is significant
because of its contribution to the cost of production. For human
resource management, remuneration is the major function. The
HR specialist has a difficult task of fixing wages and wage
differentials acceptable to employee and their leaders. There are
mainly 3 three components of employee remuneration. These are
as follows…..
1) Wages and salary, 2) Incentives and 3) Non monitory benefits.
As far as it is concerned with the Raj bank, there is a
specific policy of employee remuneration formed by RBI and
govt., and it self also. So and also for the management of
employee remuneration there is a specific administration
department which cares of wages and salary and all things about
remuneration.

 WAGES & SALARY :: -

Wages represent Hourly rates of pay and, salary refers to

the monthly rate of pay irrespective of the number of hours put by
an employee. Wages and salaries are subject to annual
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increments they differ from employee to employee and depend
upon the nature of job seniority and merit.
 INCENTIVES ::-

Incentives are also called ”payment by result” are paid in

addition to wages and salaries. Incentives depend upon
productivity, sales, profit or cost reduction efforts there are.
1) Individual incentive schemes and
2) Group incentive program

Individual incentive are applicable to specific employee are

applicable to specific employee performance. Where a given task
demands group effort for completion, incentives are paid to the
group as a whole. The amount is later divides among incentives
refer to variable rewards granted to the individual in terms of
changes in specific results in organizational setting besides
wages and salaries, employees are paid incentives depending
upon their performance. Incentives payment is quite substantial
and is paid as regularly as wages and salaries. The primary
advantage of incentives is the inducement and motivation of
workers for higher efficiency and grater output. It option schemes
and the like perquisites are offered to retain competent
executives.

 NON MONITORY BENEFITS ::-

These include challenging job responsibilities. Recognition

of merit, growth prospects, competent supervision, comfortable
working condition and job sharing.

As far as Raj Bank is concerned that is specified

department who cares about employee remuneration. Apart from

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salaries they are also provides bonus (one month salary) also
provides provident fund scheme and gratuity and also VRS
scheme, group insurance too.

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 TRAINING &
DEVELOPMENT
Training is the process of increasing the knowledge and
skills for doing a particular job. It is an organized procedure by
which people learn knowledge and skills for a definite purpose.
The purpose of training is basically to bridge the gap between job
requirement and present competence of an employee. Training is
aimed at improving the behavior and performance of a person. It
is a never ending or continuous process. In any organization their
should be proper training program to improve employee
resources, as well as organization development. Training involves
helping an individual learn how to perform his present job
satisfactorily.
On the other hand development is long term education
process utilizing a systematic and organized procedure by which
managerial personnel learn conceptual and the critical
knowledge for general purpose. So in the any organization the
importance of the training and development is very vital, nobody
can ignore it. As far as it is a continuous process there. Raj
bank is working with advanced technologies. At every step better
training and development is required.
At present every employees of the firm are getting trained
by its own EDP department n advanced computer technologies.
They are also organizing internal seminar for improvement of the
firm and also they are sending their employees outside like
Gandhinagar, Ahmnedabad,Delhi, Pune and Mumbai to o\o for
the better development. As it is banking firm there is continuous
training and development program organized by other banking

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firm and association for improvement of whole banking sector in
India.

PROMOTION
AND TRANSFER
Mobility and flexibility in the workforce are necessary to
cope with the changing requirement of an organization. Job
changes provide necessary flexibility, employees move from one
job to another one through transfer, promotion. So the
importance of employee movement in the organization in very
important.

 Promotion:: -
Promotion refers to advancement of an employee to a
higher post carrying grater responsibilities higher status and
better salary. It is the upward movement of an employee in the
organization’s hierarchy to another job commanding grated
authority higher status and better working condition when an
employees is assigned a higher level job with more pay and
powers he is said the promoted promotion may be temporary or
permanent depending upon the needs of the organization so this
is just like tool which can be useful in two way one way it is a
motivation second way it becomes a source of recruitment from
with in a organization so the promotion in the organization is who
is present as other activities in case of the Raj bank as it is Co-
Operative sector they have to follow promotion policy of
government is merit cum seniority in case of promotion they are
not independent too.

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 Transfer::-
A transfer refers to a horizontal or literal movement of an
employee from on a job to another in the same or organization
with out any significant change in status any pay. It has defined
as “ A literal shift causing movement of individual from one
position to another. Usually without involving any marked change
in duties as responsibility will needed of compensation. The need
for transfer may grid due to several reason transfer mane of
which the following objective.
To meet organizational need
To satisfy employee needs
To better utilize employees
To make the employee more versatile
To adjust the work force
To provide relief
To punish employees.

The transfer is beneficial in many ways the benefits of the

transfer is as under
Increase in productivity and effective need of the organization.
Greater job satisfaction to employees
Stabilize fluctuation work needs
Improve employee skills
Remedy for faulty placemen
Develop employees for further promotions
Avoid monotony and boredom.
So, the transfer is also important as far as concerned with
Raj bank there is no specific transfer policy but according to
requirement and for convenience of the employee they use to
make transfer.

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 Marketi
ng
Departme
nt
(76)
 At
Raj
Bank

(77)
 INTRODUCTION

Today, marketing is spread in every field of like hospitals,

services, goods even politics and many more. In banking sector
too the importance of marketing also can not measurable, still it
has not developed in public sector it is only limited to foreign
banks and private sector. The reason for success of foreign in
India is only best marketing efforts. Today in banking sector there
is a cutthroat competition among public sector, private sector and
foreign bank.

Marketing is a human activity directs at satisfying the needs

and wants of customers, there are five stages of bank marketing
firstly marketing g is advertising, sales promotion and publicity,
secondly marketing is smiling and Co-friendly atmosphere, thirdly
marketing is innovation like the ATMs or cheques with drawls on
fixed deposits, fourthly marketing is positioning. When all banks
advertise and innovate, they look alike so, they should try to
position themselves differently, even through symbols, logos or
aggressive advertising so that the customer can distinguee
between one bank and another and finally marketing is analyzing,
planning and control.

At Raj bank though there is no specific marketing

department. for marketing of different services but providing vest
services to their customers and getting good customer
satisfaction, and doing such efforts of marketing like promotion
activities they are in directly getting benefits of the marketing.
Today they are also planning for such continuous marketing

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efforts. And with in the few years they will have aggressive
marketing department.

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PROMOTIONAL ACTIVITIES
Promotion tools are also essential in the bank’s marketing
mix. We need personal selling in customer contact, development,
personal service. And so on. Similarly, bank marketing program
need advertising as mass communication tool. The bank is a
sponsor. It sends a message to prospective buyers (the audience)
by means of a medium (The carrier of the message). An
advertisement in bank marketing is a promise3 a promise of
satisfaction to prospects who buy or use the service offered by the
bank or who are willing to patronize the bank. Banks are using all
media of advertisement such as newspaper, radio television,
magazines etc., for advertising their services and for getting the
business. Bank marketing also uses sales promotion devices such
as point of purchase materials, advertising specialties (ball pens,
calendars, diaries, notes pads etc.) brochures and booklets
describing bank services, etc. a bank has also to use public
relation as mode of promotion to build up and maintain its bright
image in the community.
As far as it is concerned with promotion activity than Raj
bank is not doing any personal selling but bank is believe in very
strong goodwill and also best customer satisfaction they are using
advertising they are giving their advertisement in news paper like
Sandesh, Gujarat samachar etc. and also in banking magazine
and for publicity they are organizing such shows like recently they
have organized three bug shows. First in Morvi and second and
third in Rajkot with Sunidhi Chauhan and Anu Malik and second
with great Andnd Murti Guruma. By this way be using very simple
and less expenses tools of marketing like advertising and
publicity. They are getting goods response from society and for
Raj bank work of work of month is their best publicity.

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 MARKETING RESEARCH
AND INFORMATION
Good marketing decisions are not made in a vacuum.
Hence, even in bank marketing. We need marketing research and
information to enable bank executive to make sound decisions.
The increase in the use of marketing research in bank marketing
is due to two forces:

competition pressures to be right, and Customer –

orientation in marketing planning and program. Banks are now
establishing a separate marketing organization. Conduction
marketing research, setting up sales training program and
adopting sales promotion divides promotion devices to attach
customer we have special bank advertisement through radio. T.V.
and newspapers. Marketing research may be defines as “The
scientific and controlled process of gathering of none routing,
marketing information, helping management to solve marketing
problems.”

As far as it concerned with the marketing research process

at Raj bank. They have been continuously doing such research
from beginning. But one positive point for marketing research is
that they not doing any big expenses for marketing research and
for executives. Bank’s staff member themselves goes to market
and gathers requited information or data. Such information or
data they are collection from direct RBI or other banks. So, by this
way they are getting benefits by using marketing research
process.

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Finance
Departme
nt
At
(82)
 Raj
Bank

(83)
 INTRODUCTION
Finance is the fuel of administration. Without adequate
financing no business enterprise can raise its potentials for
growth and success. And it would be worthwhile to recall what
“Henry Ford” once remarked “Money is an arm or leg. You either
use it or lose it.” This statement though apparently simple and
quite meaningful, it brings home the significance of money or
finance. In the modern money oriented economy finance is one of
the basic foundations of all kind of economic activities.

Finance management is indeed the key to successful

business operations. Without proper administration and effective
utilization of finance, no business enterprise can utilize it’s
potentials for growth and expansion. Organization and control of
these function is important for all types of business units.
Specially in public undertaking massive investment has so far
been much less productive, it is necessary to organize the finance
functioning such a manner that should help the business in
achieving it’s basic objective with minimum cost.

According to Hoagland “Financial management is

concerned mainly with such matter as how of business
corporation raises it’s finance and how it make use of that.”

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 FINANCIAL PLANNING
Planning is very necessary for the smooth running of the
business can not be carried on without planning. Planning means
deciding in advance what is to be done for each functional area of
management. The planning of each area should link to the
objectives of the organization. Financial planning means deciding
in advance the financial activities to be carried on to organization.
So, the basic purpose of financial planning is to make sure that
adequate funds are raised at minimum cost and they are used
widely. A proper planning of the business on one hand and to
allow a fair return to their contribution on the other.

Thus financial planning includes the following…

1) Determination of financial objectives.

2) Formation of financial policy.
3) Development of financial procedure.

In Raj Bank, the financial planning has been done through

proper management in various areas like liquidity planning,
investment planning, profit planning, cash management etc.

(85)
 CAPITAL STRUCTURE
OF THE RAJ BANK
Capital structure decision is yet another important area
under financial management. Capital structure refers to the mix
or proportion of firm’s permanent long term financing
represented by debt preference must ensure the maximization of
wealth of shareholders so even the capital structure decision
must be taken in the light of wealth maximization objectives. That
particular mix of debt and equity which maximizes the value of
the firm is known as optimum capital structure in simple
word capital structure refers to the composition of capital.

Capital structure = Long term debts + Preference share

capital + Equity share capital + Reserves.

1. Capital Rs. 4,60,00,000.00

2. Reserves & surplus Rs. 45,41,50,000.00
3. Deposit Rs. 2,86,41,00,000.00
4. Borrowings Nil
5. Other liabilities & provision Rs. 2,70,00,000.00

(86)
 CAPITALIZATION
Capital plays an important role in any business at the time
of corporation of the business, it is the first problem before
promotes to decide how much capital is to be required and in
what form. It is not an easy task. A financial plan is to be
prepared form the purpose of explaining the abort term and long
term needs of finance to the company. Sever consideration would
be kept in mind such as cost of capital fair return to the
contributors of capita risk involved flexibility etc. while taking
decision in this regard it required proper capitalization.

Proper capitalization reveres to the total amount of capital

required in the long run to run the business smoothly
capitalization uses in its quantities aspect and reveres to the
amount at which a company’s business can be valued most of the
traditional authors define the terms in this sense the sum total of
the par value of all share. After definition of capitalization are
being reproduces below in order to understand the term well.

E.F. Lincoin, The amount of capital at any time should not

excepted none should it be less than the amount required in both
situation it there firm will be loser. These conditions are called
under capitalization and for capitalization. In case the amount is
hiring than it is required the company his have to pay more
interest on the surplus capital are they rescuing the proper of the
concern of the total capitalize not sufficient to discharge the
function of the business the concern with not be in a position of
even reasonable profits due to lack of funds it is there fore,
necessary to have proper capitalization.
(87)
 CASH MANAGEMENT
Cash is the medium of exchange which allows
management to carry on the various activities of the business on
day to day basis. And management of cash is one of the most
important answers of over all working capital management due to
the fare there cash is the most liquid type of current assets. As
such it is the responsibility of the finance function to see that the
various functional areas of the business have sufficient cash were
ever they require the same at the same time if has also it be
ensured that funds are not blocked in the form of idle cash as the
cash remaining idle also involves cost in the form of interest cost
and opportunity cost as such the management of cash have to
kind a mean between these two extremes of shortage of cash as
well as idle cash.

The basic objectives of cash management of are to reduce

the operating cash balance requirement to maintain possible
extent without affecting the routine transaction. For the
management of cash flow statement is the most important tool
cash low statement provided information about the cash ratio
and payment of a firm for again period. It provides important
information that compliments the profit and loss account and
balance sheet.

(88)
 RATIO ANALYSES
Financial analyses of an organization depend to a large
extent on the use of ratios. The technique is commonly known as
financial ratio analyses. Ratio analyses is a very powerful
analytical tool useful for measuring performance of an
organization the ratio analysis helps the management to analyses
the past performance of the firm and to make further projection.
Ratio analysis is a process of comparison of on figure against the
calculation of ratio relatively easy and simple task but the proper
analyses and interpretation of the ratio can be made only be the
skilled analysis.

The ratio of The Raj Bank of the last year is as under.

(89)
(90)
 FINANCIAL
INFORMATION

The liberalization of the financial sector is the key for the

over all liberalization process. Gradually, the structure of the
financial market itself has begun to change, in the changing
Financial Market; The Co-Operative Bank Of Rajkot Ltd. has
market the progressive growth and profitability both the financial
year 2004-2005 which is reflected in the following Financing
since inception:

(Rs. In Lacs)

Particulars 31-3-04 31-03-05

Members 27,400 29,100

Share Capital Rs. 475 Rs. 480

Deposit Rs. 2620 Rs. 2860

Advances Rs. 1120 Rs. 1420

Net Profit Rs. 805 Rs. 810

Working Capital Rs. 28100 Rs. 32425

(91)
 PROGRESS REEPORT

NET PROFIT
AMOUNT (Rs. In Lacs)

1000
780 805 810
750

500

250

0
2003 2004 2005
YEAR

INVESTMENTS

200
AMOUNT (Rs. In Crore)

147.5
150 125.5 130

100

50

0
2003 2004 2005
YEAR

(92)
 DEPOSITS
AMOUNT (Rs. In Lacs)

286
300 262
212
200

100

0
2003 2004 2005
YEAR

ADVANCES

200
AMOUNT (Rs. In Crore)

150 142
112
100 92

50

0
2003 2004 2005
YEAR

(93)
 NPA & RECOVERY
MANAGEMENT
The core banking business is of mobilizing the deposits and
utilizing if leading to industry. Leading business is generally
encourages because it has the effect of funds being transferred
from the system to products purposes which results into
economic growth. However leading also carries credit risk which
arises from the failure of borrower to fulfill its contractual
obligation.

 Meaning of NPA ::-

An asset is classifies as non performing assets (NPAs) if

dues in the form of principle and invest are not paid by the
borrower for a period of 180 days however with effect from march
2005 defaulters would be differs to a borrower if dues are not
paid for to days if any advance or credit facilities arranged to that
borrower is non performing with out having any regard to the fact
that there may still exist certain advances credit felicities having
performing status.

(94)
 As the Raj Bank is concerned than there is gross NPA is
“ZERO” since beginning and net NPA is also very nearest to ZERO.
Today the net NPA is 00.26%. And for managing this NPA they
constantly affording for the best and also the have centralized
department for advances this is one of the result for having ZERO
NPAs. And before granting any loan they used to concern the
repay capacity of the applicant and for granting the loan every
branch head a power to grant loan up to 2,00,000 lacs only.

But more tan that amount that loan only by a permission of

a main branch and management will grant and for they used to
make credit report of that person in that report the name, history,
business, annual income and other information to be prepared by
C.A. of the bank or other staff members. And step by step
procedure takes place. And for recovery they have very strong
department. But according to them they only care at a time of
granting the loan so, they have no need to very strong recovery
and for recovery these are the steps followed by the bank. First by
the telephone and that bank notice and than personal visit and
tan notice through advocate and lastly they do government
procedure through court.

(95)
 RISK MANAGEMENT
Risk management is the strategic tool, which helps I
identifying, quantifying, monitoring and controlling risk. Risk
management protects an organization from dying due to
insolvency resulting from the adverse effects of risk. Though
universally relevant it is of immense importance to a banking
organization or financial institution. In view of the same Risk
management is analysis here from the banking perspective.
However with large corporate house establishing their own
independent dealing rooms, risk management systems are no
longer limited to banking organization.

 Classification of Risks:-

Risk normally has to dimensions i.e. the quality of risk and

the quantity or risk. Quality of risk is essentially the probability of
the risk during into an actual loss. Quantity of risk is the financial
effect of the risk turning into a loss. Both these dimension are
extremely difficult to measure, primarily because it is an
estimation of the future, which is highly uncertain. To understand
risk management it is extremely important to understand the
various types of risks, their characteristics and their inter
relationships.

(96)
 Liquidity Risk:-

Liquidity risk is essentially a result of adverse movements

of other risks i.e. credit risk, interest rate risk, foreign exchange
risk. Small information in the market about the liquidity problems
faced by a bank may result into withdrawal of enormous deposits,
thereby affricating the problem. Liquidity risk also includes rising
of funds at an abnormal cost to need its commitments.
Management of interest rate risk and liquidity risk is together
knows as assets liability management. Thus asset liability
management is a subset of the whole gamut of risk management
tools.

Credit Risk:-

Credit risk is the most fundamental risk faced by a banking

company. Credit risk is the risk of default by a borrower of funds
or decline in the credit standing of a borrower. It is the most
difficult to quantify due to the large amount of subjectivity
involved in it. Thus credit risk management can assist in decision
making; it can not be a substitute to the judgmental decision of a
credit officer.

Market Risk:-

It is the risk of loss due to adverse movements in the

market rates during the compulsory holding period having an
impact on the portfolio held by market is also important in
constantly determining the true worth of a collateral security
provided by the borrower. Foreign exchange risk is often regarded

(97)
as a part of the market risk, but may be bifurcated for facilitating
better analysis.

S.
W.
O.
T.
(98)
 Analysis
 STRENGTHS ::-

Net NPA Zero since inception.

Professional management & Co-Operate team spirit.
Strong Brand equity.
Fully computerization and Automation.
Respectable ranking and position in Gujarat’s top Co-
Operative banks.
Profitability and sound liquidity.
Branches in all most developed parts of saurashtra.

 WEAKNESS ::-

Lack of marketing expertise.

Lack of modern management concepts.
Sometimes communication gap is found which signs lack of
professionalism.
Lack of scheduled status which may affect expansion of their
business.
Lower volume of advances due to higher rate or interest.
Strong need for a more disciplines, smooth and sophisticated.

(99)
Environment for working and customer service.

(10
0)
 OPPORTUNITIES ::-

General insurance business at higher level.

No. of branches can be increased in all overall state.
After getting scheduled status we may apply multi state bank
to expand their business.
Introduction of various retail services.
Tax consultancy can be provided by using the skills of the
professional personnel and experienced seniors.

 THREATS:-

Confidence crises in the co-operative banking sector can

disturb the bank’s progress.
Changes in govt. rules and regulation.
Cut throat competition and entry of new foreign bank and its
sound financial structure.

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1)
Future
Plan
of

(10
2)
 Raj
Bank

(10
3)
 VISION - 2010
To maintain excellence in operation & management by
bringing I transparency & integrity.
To emerge as symbol of public trust & confidence by creating a
positive image.
To ensure speedy & satisfactory customer services through
continuous product innovation & aggressive, marketing
strategies.
To adopt policy for technological up gradation& advancement
to boost up total computerization & inter branch
connectivity for all the branches.
To develop & motivate human resources there by cultivating
processional culture in the banking operations.
To strive for continuous growth & profitability through branch
expansion & modernization.
To introduce more ATM centers & various “plastic products” for
better customer services.
To maintain the asset quality at the optimum level by
continuous efforts for credit risk management.
To provide multi dimensional services to customers by
incorporating various modern service areas like insurance,
bill collection and providing one door service to clients.
To explore more non-fund based business like latter of credit,
bank guarantee, custodial services to increase bank’s non
interest income.
To achieve business turnover of Rs.650 cores & net worth of
80 cores by 2010.
To continue to maintain the NET NPA at ZERO level.
To plan Bank’s balance sheet with judicious ALM.

(10
4)
Suggesti
on
To
(10
5)
Raj
Bank

(10
6)
 SUGGESTION
As improvement is a constant requirement for every one
and if we try to learn from a little things also. Than every minute
we will improve ourselves. And for constant improvement in
organization management should keep their eye on every
concern, during my visit at bank I have tried to cover everything
and according to my knowledge I am trying to give suggestion to
the Raj bank and I am sure that it surely will be helpful in
progress of the bank.

First and foremost suggestion for Raj bank is that, yet they
are not using such marketing tools in the area of cutthroat
competition in banking sector. Each bank should try for better
and different marketing. Raj bank should make one group of
executive, who can help to the management and can provide
different services like collection from home only and they should
use such slogan for innovative products like “only one call can
make your life better.” This slogan can be sued for assets product.
So by using not only simple advertisement but also strategic
marketing tool bank can improve a lot in the market.

And last but not least that is there is need to improve web
site of Raj bank during my report work I have found very poor
contents in the web site of Raj bank as Bank have their own EDP
department with high educated staff. And by creating attractive
web site bank surely will be able to create good image. And one
thing is also there should professionalism in management at
every level.

(10
7)
C
O
N
C
L
U
S
I
O
(10
8)
N

(10
9)
 CONCLUSION
After having all the required information for preparing my
report, I have tried to analyze each and every function of the Raj
Bank. During my report all the staff member of the Raj bank had
well co-operate me. And also I have found that the, there is a very
good level of commitment in all the staff members. During my
report I have tried to cover each functional area of the bank and
after having clear idea about everything in the bank, I can
conclude that the Raj bank is one of the leading firm in the bank,
I can conclude that the Raj bank is one of the leading firm in the
co-operative sector, and with advanced technologies and
educated staff to trying to positioning in the banking market. But
than also due to such weaknesses of co-operative sector Raj bank
is also suffering from such limits.

So, at last we can conclude that the Raj bank is being

leader in the market and due to great leadership of Mr.
Ramnikbhai Dhami (Managing Director) bank is getting great
goodwill in the market and also great goodwill of the other
director helps director helps to the bank in creating good image in
the field of the bank.

For, better future a great success my all good wishes always

with the Raj bank. I wish them for better achievement

(11
0)
B
I
B
L
I
O
G
R
A
P
H
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Y

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 BIBLIOGRAPHY

 Books ::-

Human Resource Management & Personnel

Management
By :- K. Aswatthappa
Publication :- Tata Mc-Graw Hill

Marketing Management
By :- S. A. Sherlekar
Publication :- Himalaya Publication House

Finance Management
By :- B. S. Shah
Publication :- S. B. Shah on Behalf of B. S. Shah

 Web Sites::-
WWW.RAJBANK.NET
WWW.GOOGAL.COM

 25th Annual Report Of The Raj Bank

(2004-2005)

(11
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