BANK OF MAHARASHTRA Share price

V. BANK AND MANAGEMENTBRIEF HISTORY AND BACKGROUNDThe Bank was registered on September 16 1935 at Puneasa Public LimitedCompany in the name "The Bank of Maharashtra Ltd.". The Bank wasstarted by a group of visionaries from Pune with the objective toserve especially the common men. The operations commenced on February8 1936. Right from its inception the focus of the Bank has been toassist small business enterprises traders self-employed and othercommon men. In 1944 the Bank became a Scheduled Bank.The Bank has made steady progress to become a household name inMaharashtra. From a modest beginning the Bank has grown in size andstature to become one of the major banks in India. The growth of theBank was also helped by take over of small banks like Bank of KonkanLtd. Bank of Nagpur Ltd. Bharat Industrial Bank Ltd. Barthia BankLtd. In 1969 the nationalisation of 14 major banks in the country tookplace and Bank of Maharashtra was one of these major banks. The Bankmarched ahead in the changed scenario and crossed many milestones. Atthe time of nationalisation the Bank had 211 branches which has grownto 1251 branches on September 30th 2003. The Bank is one of theprogressive nationalised banks that achieved autonomy in 1998 andcontinues to enjoy the status by virtue of good performance. The Bankhas prospered with consistent growth and in the last year the businesshas grown by 15.67% and the profit by 52.69%.The Bank with its 1251 branches spread over 21 States and 2 Unionterritories serves well diversified industries consisting Steel & AutoDiamond & Jewellery Petroleum Chemicals and Pharmaceuticals PowerHotels Education Infrastructure & Housing sectors. The Bank hassigned MOD with EXIM Bank of India in February 2000 for co-financing ofproject exports.The Bank has also sponsored 3 Regional Rural Banks (RRBs) as a part offulfilment of its social responsibilities towards the rural developmentand poverty alleviation. The Bank is acting successfully as theConvenor of State Level Banker's Committee for the State of Maharashtraand also for Rajbhasha. The Bank has the Lead Bank responsibility in 6districts namely Aurangabad Jalna Pune Satara Thane and Nasik.The Bank has a fully owned subsidiary Maharashtra Executor and TrusteeCompany Ltd. which has been extending trusteeship services for thelast 57 years. The company undertakes management of public/privatetrust and administration and execution of wills. The Company has beenearning profits continuously over the years.The Bank has also entered into Joint Venture with Nextstep Infotech P.Ltd and Magic Software Enterprises Israel in promoting Magic eMoneyLtd engaged in software development and providing software solutions.The Company has started operations in May 2001 and has earned profitsin its very first year of operation.The growth profile of the Bank over the last 67 years is given below: (Rs. in Crores)Year Capital Deposits Advances No of Branches (Excl. Extension counters)1936 0.01 0.07 0.03 11940 0.02 0.28 0.13 31950 0.16 2.31 1.25 191960 0.33 15.14 6.83 531970 1.49 103.68 71.97 2111980 2.30 832.02 472.84 7141990 84.50 3234.25 1649.61 11161998 748.69 9134.30 3592.61 11621999 330.51 10928.52 4061.84 11752000 330.52 13406.55 5252.21 11952001 330.52 17024.56 6672.53 12192002 330.52 19130.63 8255.12 12222003 330.52 22175.75 9508.14 1232As is evident from above the Bank has seen a steady and consistentgrowth in both its advances and deposits. In the last five years thedeposits and advances of the Bank have grown at a compounded averagerate of 19.41% per annum and 21.49% per annum respectively.The Bank's deposits have doubled during the last four years from Rs10928.52 crores on March 31st 1999to Rs. 22175.75 crores on March31st 2003. At the same time advances have more than doubled over thelast four years to reach the level of Rs 9508.13 crores as on March31st 2003 from Rs 4061.84 crores as on March 31st 1999.PRESENT STATUSThe Bank as on September 30th' 2003 has 1251 domestic branches (239metropolitan 232 urban 194 semi-urban and 586 rural) including 12service branches. This further includes specialised branches namely 2Industrial Finance branches 6 SSI Branches 1 personal banking branch4 Agricultural Hitech Branches. Bank has also 37 extension countersunder its domestic operation. Further the Bank serves the customersthrough 45 ATMs.Bank has been participating in various social upliftment programmes ofthe Government including its role under Service Area Approach and otherrural/urban employment generation programmes.The Bank has the policy to improve its income and profit through growthin business. Its track record of business growth has been better thanindustry average as has been detailed elsewhere in the document. As onMarch 31st 2003 Bank's total business stood at Rs. 32200.54 crore. TheBank earned an operating profit and net profit during the year FY03 ofRs. 520.58 crore and Rs. 222.02 crore respectively. Net NPA of theBank as on March 31s* 2003 stood at Rs. 459.14 crore which is equalto 4.82% of its net advances.The Bank's Capital Adequacy as on March 31st 2003 was 12.05%. Thecapital structure as on that date include Rs. 420.00 crore asSubordinated Bonds which it could raise successfully during FY 1998-99FY 2000-01 FY 2001-02 and FY 2002-03 respectively. The present capitalof the Bank stands at Rs. 330.52 crores.Bank subscribes to the policy of transparency and makes disclosures asis required under the existing policy of regulatory Authority. It hasput in place citizen charter fair practices code and adheres to theprinciples of corporate governance.