Monday, 6 May 2013

Training and Development Case Studies in Bank of India

Project Report on Training and Development in Bank of India

Case Studies on Training and Development in Bank of India

Dissertation on Training and Development Topic

Company Profile

Bank of India, a public sector banking institution in India reported an extraordinary rise in standalone net profit for the quarter ended December 2008 due to sharp rise of 45.84% in interest on advances coupled with rise of 20.81% on investment income. During the quarter, the profit of the company rose 70.38% to Rs 8,721.70 million from Rs 5,118.90 million in the same quarter previous year. During the quarter, interest on advance stood at Rs 34,401.90 million while investment income stood at Rs 8,651.60 million. Interest earned for the quarter rose 37.83% to Rs 43,431.70 million, while total income for the quarter jumped 45.57% to Rs 53,937.40 million, when compared with the prior year period. The company posted earnings
of Rs 16.61 a share during the quarter, registering 58.19% growth over prior year period.

Bank has made adequate provisions for terminal benefits of Rs. 1003.6 million estimated and provided during the quarter. Bank has also made a provision of Rs.720 million towards wage revision during the quarter. Global Net Interest Margin improved during the quarter to 3.40% from 3.14%. The rise in Credit portfolio from Rs.1036560mn to Rs.1361100mn (31% y-o-y) contributed to a higher Net Interest Income of Rs.15210mn for Q3 FY09 as against Rs.10790mn in Q3 FY08.

The Gross NPAs of the Bank stood at Rs.22130mn as on December 2008, with a Gross NPA ratio of 1.63% (1.90% as on 31.12.2007) and Net NPA ratio of 0.52% (0.62% as on 31.12.2007).NPA Provision Coverage ratio is at 77.28%. Capital Adequacy Ratio rises to 13.39% as per Basel II.

Bank has implemented Agriculture Debt Waiver and Debt Relief Scheme 2008 as per RBI guidelines and Rs.6467.2mn has waived under the scheme in 341136 accounts for which preliminary claim has been preferred with RBI. And an amount of RS.2651.6mn (41% of the claim amount) has been reimbursed by the RBI on 24.12.2008. The amount of Rs.2226.2mn is eligible for relief under the scheme in 85101 accounts and claim will be submitted by September 2009.

Training and Development in Bank of India Case Study
Peer Group Comparison

Key Concerns

• The Banking industry is very competitive and the ability of banks to grow depends on their ability to compete effectively.

• Banking in India is a heavily regulated industry and material changes in the regulations could adversely affect Banks business.

• Exchange rate fluctuations may have an impact on banks financial performance.

• A slowdown in economic growth in India could cause banks business to suffer.

• The introduction of technology in banking operations has also imposed greater responsibility to protect against various information security threats and to ensure wider assurance of safeguard of the interest of customers.

• Regulatory amendments.

• Implementation of Basel II requires higher capital.

Global Outlook

The global economic environment continues to be uncertain. The world economy, which was passing through unprecedented financial turmoil since August 2007, experienced a jolt in September 2008 when the failure of Lehman Brothers led to widespread panic across global financial markets. The liquidity crisis that ensued not only engulfed developed markets but also quickly transmitted to emerging markets, including India. The US Federal Reserve responded by infusing dollar liquidity into large financial centres through currency swap arrangements with major foreign central banks in addition to massive injection of liquidity in the domestic market through several innovative schemes.

Domestic Outlook
Like other EMEs, India too has been affected by the global financial crisis. Real GDP growth moderated to 7.8 per cent in the first half of 2008-09 as against 9.3 per cent in the first half of 2007-08. The third quarter of 2008-09 witnessed signs of further moderation in growth, especially in the industrial sector and some segments of the services sector. Over the last five years, India clocked 8.8 per cent average annual growth, driven largely by domestic consumption and investment even as the share of net exports rose. While the benign global environment, easy liquidity and low interest rates helped, at the heart of India’s growth have been its growing entrepreneurial spirit and rise in productivity. These fundamental strengths continue to be in place. Nevertheless, the global crisis will dent India’s growth trajectory as investments and exports slow. Clearly, there is a period of painful adjustment ahead of us. However, once the global economy begins to recover, India’s turnaround will be sharper and swifter, backed by our strong fundamentals and the untapped growth potential. Meanwhile, the challenge for the Government and the Reserve Bank is to manage the
adjustment with as little pain as possible.

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