RMCB PROJECT 2105-2017

ANALYSIS OF PERFORMANCE OF UCO BANK

TEAM 6
GROUP MEMBERS:
MEGHALI NAINA
MEHSHINA BANO
MOHD SHAMOON ANSARI
PRAGYA SAHAI
PRAGYA TANDON
PRIYARANJAN KUMAR

TO WHOMSOEVER IT MAY CONCERN

THIS IS TO CERTIFY THAT THE PROJECT STUDY REPORT, TITLED:

ANALYSIS OF PERFORMANCEOF UCO BANK
SUBMITTED BY TEAM 6 SECTION A AS PARTIAL FULFILMENT OF REQUIREMENT OF THEIR
TWO YEAR PGDM (2015-2017) IS A BONAFIDE WORK CARRIED OUT BY THEM AT OUR
INSTITUTE.

THIS PROJECT STUDY IS THEIR ORIGINAL WORK AND HAS NOT BEEN SUBMITTED TO ANY
OTHER UNIVERSITY/INSTITUTE.

DR SHYAMJI MEHROTRA
(FACULTY FOR RMCB)

DATE:
PLACE:

ACKNOWLEDGEMENT

It is not possible to prepare a project report without the assistance & encouragement of other people. This
one is certainly no exception.
On the very outset of this report, we would like to extend my sincere & heartfelt obligation towards all the
personages who have helped us in this endeavor. Without their active guidance, help, cooperation &
encouragement, we would not have made headway in the project.
We are ineffably indebted to the team for conscientious support and encouragement to accomplish this
assignment.
We are extremely thankful and pay my gratitude to my faculty DR. SHYAMJI MEHROTRA for his
valuable guidance and support on completion of this project in its presently.
We extend our gratitude to JAIPURIA INSITITUE OF MANAGEMENT, LUCKNOW for giving us this
opportunity.
We also acknowledge with a deep sense of reverence, our gratitude towards our parents and member of our
family, who have always supported us morally as well as economically.
At last but not least gratitude goes to all of our friends who directly or indirectly helped us to complete this
project report.
Any omission in this brief acknowledgement does not mean lack of gratitude.

Thanking You.

EXECUTIVE SUMMARY

Founded in 1943, UCO Bank (UCO Bank or the Bank) provides retail banking, corporate banking,
treasury, and other banking services to individual and corporate customers in India. The Bank was formerly
known as The United Commercial Bank Ltd. and changed its name to UCO Bank in 1985.
For FY 2016, total deposits with the bank stood at Rs. 2,07,118 Cr. as compared to Rs. 2,14,337 Cr. in FY
2015. For the same period, net NPAs stood at 9.09 % as compared to 4.30 % in FY 2015.
As of March 31, 2016, the Banks retail loan portfolio registered a sharp growth of 11.30% YoY to reach Rs.
20,834 Cr.
CASA share in Total Deposits stood at 32.23 % as at the end of March 2015.

TABLE OF CONTENT
INTRODUCTION..............................................................................................................................................6
Mission Statement..............................................................................................................................................6
Overview............................................................................................................................................................6
Strengths.............................................................................................................................................................6
Organization Structure.......................................................................................................................................6
Commitment to Customers................................................................................................................................7
ANALYSIS OF UCO BANK.............................................................................................................................8
Key Financial Figures........................................................................................................................................9
Profitability Analysis..........................................................................................................................................9
Key Balance Sheet Figures..............................................................................................................................10
Efficiency Analysis...........................................................................................................................................11
Valuation Analysis............................................................................................................................................12
Dividend History..............................................................................................................................................12
Liquidity and Credit Analysis..........................................................................................................................12
Ownership pattern............................................................................................................................................13
OVERALL FINDINGS....................................................................................................................................17
CONCLUSION................................................................................................................................................17
APPENDIX......................................................................................................................................................18

INTRODUCTION
Founded in 1943, UCO Bank is a commercial bank and a Government of India Undertaking. Its Board of
Directors consists of government representatives from the Government of India and Reserve Bank of India
as well as eminent professionals like accountants, management experts, economists, businessmen, etc.
Shri Ravi Krishan Takkar
MD & CEO

Shri Charan Singh

Executive Director

Mr. G.Subramania Iyer

Executive Director

Vision Statement
To emerge as the most trusted, admired and sought-after world class financial institution and to be the most
preferred destination for every customer and investor and a place of pride for its employees.
Mission Statement
To be a Top-class Bank to achieve sustained growth of business and profitability, fulfilling socio-economic
obligations, excellence in customer service; through up gradation of skills of staff and their effective
participation making use of state-of-the-art technology.
Global banking has changed rapidly and UCO Bank has worked hard to adapt to these changes. The Bank
looks forward to the future with excitement and a commitment to bring greater benefits to you.
UCO Bank, with years of dedicated service to the Nation through active financial participation in all
segments of the economy - Agriculture, Industry, Trade & Commerce, Service Sector, Infrastructure Sector
etc., is keeping pace with the changing environment. With a countrywide network of more than 3000 service
units which includes specialized and computerized branches in India and overseas, UCO Bank has marched
into the 21st Century matched with dynamism and growth.
Overview
It is in the Service of Community since 1943. They have more than 3000 Service Units spread all over
India. We also operate in two Major International Financial Centers, namely Hong Kong and
Singapore. They have our Correspondents/Agency arrangements all over the world. We undertake Foreign
Exchange Business in more than 50 Centers in India. We have Foreign Exchange Dealing Operations at 1
Center.
Strengths
Country-wide presence Overseas Presence with Profitable Overseas Operations Strong Capital Base High
Proportion of Long Term Liabilities A Well Diversified Asset Portfolio A Large and Diversified Client
Base All Branches under Core Banking Solution(CBS) Branch representation in Top 100 Centers (as per
deposits) in the country

Organization Structure
Headquartered in Kolkata, the Bank has 42 Zonal Offices spread all over India. Branches located in a
geographical area report to the Zonal Office having jurisdiction over that area. These Zonal Offices are
headed by Senior Executives ranging up to the rank of Deputy General Manager, depending on size of
business and importance of location. The Zonal Offices report to 8 Circle Offices headed by General
Managers/senior Deputy General Managers.
Commitment to Customers
In all their promotional activities, they will be fair and reasonable in highlighting the salient features of the
schemes marketed by us. Misleading or unfair highlighting of any aspect of any scheme/service marketed by
the Bank leading to unfair practice shall not be resorted to by the Bank.
In commemorating the 50th Year of Independence of India, the Bank released a booklet entitled "Our
Commitment to Customers" incorporating the Citizens Charter on services provided by the Bank.
In our continuing endeavor to serve our customers better, they have considerably extended the business
hours for public transaction at the branches on all week-days.
MARKET POSITION
As on 31 March 2012, government share-holding in the bank was 84%. Branch expansion started at a fast
pace, particularly in rural areas, and the bank achieved several unique distinctions in Priority Sector lending
and other social uplift activities. To keep pace with the developing scenario and expansion of business, the
Bank undertook an exercise in organizational restructuring in the year 1972. This resulted in more functional
specialization, decentralization of administration and emphasis on development of personnel skill and
attitude. Side by side, whole hearted commitment into the government's poverty alleviation programs
continued and the convenorship of State Level Bankers' Committee (SLBC) was entrusted on the Bank for
Odisha and Himachal Pradesh in 1983.total numbers of branch more than 4,000.

ANALYSIS OF UCO BANK

BANK PROFITABILITY ANALYSIS OF UCO BANK
SI.NO
1.
2.
3 (1-2)
4.
5.

DETAILS
Interest earned
Gross Interest Income
Net interest Income (Spread)
Non-Interest Income
Operating expenses(Non-Interest

2015

2016

19,358.99
13796.54
5,562.45
2,003.55
2,655.78

18,560.97
13712.95
4,848.02
1,596.31
2,840.94

6 (4-5)
7 (3-6)
8.

a. Employees cost
b. Other operating cost
Net non- interest income (Burden)
Operating Profit
a. Provisions & contingencies

652.23
4,910.22
3,328.36

1244.63
3,603.39
6,382.55

9 (7-8)
10.
11 (9+/10)
12.
13.
14.
15.
16.

b. Exceptional Items
Net operating profit after provisions
Profit/Loss from sale of securities
Profit before tax
Extra Ordinary Items
Taxes
Profit After Tax
Dividends
Retained Profit

1581.86
1,581.86
20.09
1,137.80
215.12
3,513.08

(2779.16)
(2,779.16)
444.06
(2,799.25)
2,949.94

Income)

DU PONT ANALYSIS
DU PONT

2016

2015

ROE

26.46

10.08

ROA

-1.14
30.48

0.47
30.74

FL

Key Financial Figures

Standalone

(Rs. Cr)

Particulars

FY 2012

FY 2013

FY 2014

FY 2015

FY 2016

Interest earned

14,632.37

16,751.71

18,229.92

19,358.99

18,560.97

Interest expended

10,730.27

12,170.18

12,170.83

13,796.54

13,712.95

Net Interest Income

3,902.10

4,581.53

6,059.09

5,562.45

4,848.02

Other income

965.55

952.17

1,320.51

2,003.55

1,596.31

Operating expenses

2,056.23

2,176.62

2,439.20

2,655.78

2,840.94

Operating Profit

2,811.42

3,357.08

4,940.40

4,910.22

3,603.39

Provisions (other than provisions for

tax) and contingencies

1,661.16

2,710.31

3,216.30

3,328.36

6,382.55

PBT

1,150.26

646.77

1,724.10

1,581.86

(2,779.16)

Tax

41.59

28.58

213.55

444.06

20.09

PAT (before Minority Interest and share

of Associates)

1,108.67

618.19

1,510.55

1,137.80

(2,799.25)

Profitability Analysis
Standalone

(%)

Particulars

FY 2012

FY 2013

FY 2014

FY 2015

FY 2016

Net Profit Margin Ratio

7.11

3.49

7.73

5.33

(13.89)

Cost to Net Income Ratio

42.24

39.33

33.05

35.10

44.08

Other Income to Net Income Ratio

19.84

17.21

17.89

26.48

24.77

Net profit margin is arrived at by dividing profit after tax by the total income generated (i.e. interest earned
plus other income) and shows what is left for the shareholders as a percentage of total income.

Cost to net income ratio is particularly important in valuing banks. It is derived by dividing operating
expenses by the net income generated (i.e. net interest income plus the other income). The ratio highlights
the efficiency with which the bank is being run the lower it is, the more profitable the bank will be. If this
ratio rises from one period to the next, it means that costs are rising at a higher rate than income. Together
these ratios help in understanding the cost and profit structure of the bank and analyzing business
inefficiencies.
Other income largely constitutes of fee income such as commission and brokerage fees and client based
merchant foreign exchange trade, service charges from account maintenance, transaction banking (including
cash management services), syndication and placement fees, processing fees from loans and commission on
non-funded products (such as letters of credit and bank guarantees) etc. Banks in developed countries derive
nearly 50% of their income from these non-funded sources. A high other income to net income ratio is
good for the bottom line (i.e. net profit) as income from this stream is derived without significant
mobilization of deposits and hence the cost associated with this income is relatively lower compared to
interest income.

Profitability Ratios

Key Balance Sheet Figures

Sources of Funds / Liabilities

(Rs. Cr)

Particulars

FY 2012

FY 2013

FY 2014

FY 2015

FY 2016

Share Capital

2,487.71

2,575.63

1,014.71

1,075.59

1,075.59

Share Application Money

935.00

Reserves & Surplus

6,125.72

7,106.79

10,211.58

11,473.36

10,511.36

Net worth (shareholders funds)

8,613.43

9,682.41

11,226.29

12,548.96

12,521.95

Deposits

1,54,003.4
9

1,73,431.0
5

1,99,533.5
5

2,14,336.7
1

2,07,118.24

Borrowings

12,901.42

9,492.43

20,718.24

10,252.54

17,240.44

Other liabilities and provisions

4,980.05

6,045.51

7,646.68

8,778.71

8,001.90

Total Liabilities

1,80,498.4
0

1,98,651.4
0

2,39,124.7
5

2,45,916.9
1

2,44,882.53

(Rs. Cr)

Application of Funds / Assets

Particulars

FY 2012

FY 2013

FY 2014

FY 2015

FY 2016

Fixed Assets

801.55

889.59

1,061.76

1,114.00

2,884.64

Cash and balance with RBI

7,811.53

5,705.36

8,049.21

8,267.52

7,949.96

Balances with banks and money at

call and short notice

5,792.16

6,638.75

6,962.80

13,901.45

10,609.28

Advances

1,15,540.0
1

1,28,282.8
6

1,49,584.2
1

1,47,350.8
7

1,25,905.37

Investments

45,771.50

52,244.90

67,451.69

68,859.43

83,974.20

Other Assets

4,781.66

4,889.93

6,015.08

6,423.64

13,559.09

Total assets

1,80,498.4
0

1,98,651.4
0

2,39,124.7
5

2,45,916.9
1

2,44,882.53

Efficiency Analysis

Particulars

FY 2012

FY 2013

FY 2014

FY 2015

FY 2016

Advances / Loan Funds Ratio

69.23

70.13

67.92

65.61

56.12

ROE / RONW

12.87

6.38

13.46

9.07

(22.35)

Advances to Loan funds ratio: This ratio indicates the efficiency with which the bank is able to deploy the
funds it mobilizes and is arrived at by dividing the banks total advances by its total deposits (i.e. deposits +
borrowings). A high advance to loan fund ratio indicates that the bank might not have enough liquidity to
cover any unforeseen fund requirements; if the ratio is too low, banks may not be earning as much as they
could be.
Return on Equity (ROE) or Return on Net worth (RONW): measures the amount of profit which the
company generates on money invested by the equity shareholders (i.e. share capital + reserves and surplus).
In short, ROE draws attention to the return generated by the shareholders on their investment in the
business. ROE is widely used in comparing the profitability of the company with other companies in the
same industry.

Efficiency Ratios

Valuation Analysis
Standalone
Particulars

FY 2012

FY 2013

FY 2014

FY 2015

FY 2016

Net Interest Income Rs.

3,902.10

4,581.53

6,059.09

5,562.45

4,848.02

Growth (%)

1.49 %

17.41 %

32.25 %

(8.20 %)

(12.84 %)

PAT (Rs. Cr.)

1,108.67

618.19

1,510.55

1,137.80

(2,799.25)

Growth (%)

22.30 %

(44.24 %)

144.35 %

(24.68 %)

(346.02 %)

Earnings Per Share Basic (Rs. )

15.02

6.30

19.44

11.20

(26.03)

Earnings Per Share Diluted (Rs. )

15.02

6.30

19.44

11.20

(26.03)

Price to Earnings

5.24

8.85

5.52

5.25

Price Earnings Ratio

Dividend History
The Company has maintained an average dividend yield of 3.13 % over the last 5 financial years.
Liquidity and Credit Analysis
Standalone

(%)

Particulars

FY 2012

FY 2013

FY 2014

FY 2015

FY 2016

Net Interest Margin Ratio (NIM)

2.77

2.34

2.82

Capital Adequacy Ratio

12.35

14.15

13.40

12.18

9.63

Net NPAs

1.96

3.17

2.38

4.30

9.09

NIM: Banks focus on lending or advancing money at a rate higher than the rate at which they accept
deposits. Net Interest Margin is calculated by dividing the difference between Interest earned (on advances)
and interest expended (on deposits) by the amount of (average) Invested Assets. If this ratio rises from one
period to the next, it indicates that the bank is able to deploy its funds more efficiently which results in
greater profitability.
Capital Adequacy Ratio (CAR): or Capital to Risk Weighted Assets Ratio (CRAR) is a measure of a
banks capital (net worth plus subordinated debt) expressed as a percentage of a banks risk weighted credit
exposures (loans).
Two types of capital are measured: tier I capital, which can absorb losses without a bank being required to
cease trading (such as ordinary share capital and free reserves); and tier II capital, which can absorb losses in
the event of a winding-up and so provides a lesser degree of protection to depositors (such as long term
unsecured loans and revaluation reserves which is taken at a discount of 55 % while determining its value
for inclusion in Tier II capital).
Measuring credit exposures requires adjustments to be made to the amount of assets shown on a banks
balance sheet. This is done by weighting the loans made by a bank according to their degree of riskiness, e.g.

loans to Governments are given a 0 %weighting whereas loans to individuals are weighted at 100 %.
Similarly off-balance sheet items such as guarantees and foreign exchange contracts are also weighted for
their riskiness. On-balance sheet and off-balance sheet credit exposures are added to get total risk weighted
credit exposures.
As per the Basel II norms the minimum capital adequacy ratios that apply are:
Tier I capital to total risk weighted credit exposures to be not less than 4 %;
Total capital (Tier I plus Tier II less certain deductions) to total risk weighted credit exposures to be not less
than 8%.
The RBI currently prescribes a minimum capital of 9 % of risk-weighted assets, which is higher than the
internationally prescribed percentage of 8 %.
Applying minimum capital adequacy ratios serves to protect depositors and promote the stability and
efficiency of the financial system.
NPA: Non-Performing Asset or NPA is a classification used by financial institutions that refer to loans that
are in jeopardy of default. Once the borrower has failed to make interest or principal payments for 90 days
the loan is considered to be a non-performing asset. Any rise in the percentage of NPAs results in a sharp
decline in the overall profitability.

Liquidity & Credit Ratios

Ownership pattern
In its latest stock exchange filing dated 31 March 2016, UCO Bank reported a promoter holding of 72.83 %.
Large promoter holding indicates conviction and sincerity of the promoters. We believe that a greater than
35 % promoter holding offers safety to the retail investors.
At the same time, institutional holding in the Company stood at 17.83 % (FII+DII). Large institutional
holding indicates the confidence of seasoned investors. At the same time, it can also lead to high volatility in
the stock price as institutions buy and sell larger stakes than retail participants.

PRODUCTIVITY PARAMETERS
AVERAGE BUSINESS PER EMPLOYEE
Average business per employee is a ratio that is calculated as company's revenue divided by the current
number of employees. This ratio is most useful when comparing it against other companies in the same
industry. Ideally, a company wants the highest revenue per employee possible, because it indicates
higher productivity and effective use of the firms resources. Its formula is
= (average deposit + average advance)/number of full time employees
The average business per employee is coming to 13.066 which is a good number. It means that employees
deliver higher productivity and there is effective use of the firms resources
AVERAGE PROFIT PER EMPLOYEE
The profit per employee ratio is related with the profit-employee productivity. It reflects the profit or the
earnings generated by per employee of the bank. It can be calculated by dividing the net profits of the bank
by number of employees. Higher the ratio, more profitable is the bank
Profit per Employee = Net Profit/ Number of Employees
The profit per employee of Uco bank is low which 0.113 is. Profit earning and timely growth in the profit
earning is an essential feature for the continued success of a bank. Without profit no commercial activity can
sustain for a long period. Improved operational efficiency along with lower provisioning can be welcome
step for improving the performance of the bank

Vulnerability and Liquidity Parameters

2016
10%

2015
12%

2014
13%

2013
14%

2012
12%

ratio
Gross NPA

20907.73,15

10265.05,7

6621.37,4%

7130.09,5%

4086.20,3%

Net NPA
Provision

%
11443.59,9%
30.52%

%
6330.58,4%
32.42%

3556.43,2%
46.08%

4069.31,3%
33.09%

2263.94,2%
33.5%

19.4

22.06

26.20

29.9

23.24

Capital
adequacy

Coverage
ratio
Contigent
liabilities to
total
liabilities
Liquidity
coverage
ratio
Interpretation

Capital adequacy ratio it is within the benchmark range in the year 2016, but above the benchmark
range in rest four years. Thus it is evident that the bank is having high risk absorbing capacity and
will be able to protect its depositors interests.
Gross NPA it has increased gradually in the earlier years and drastically in the year 2016 from 7%15%, just the double of previous year. This may be because of the poor credit rating of the customers
by the bank and ineffective recovery tribunal. This is a serious loss to the bank.
Net NPA it has also increased gradually in the earlier years and drastically in the year 2016 from 4%9%, just the double of previous year. This is also because of the poor credit rating of the customers
by the bank and ineffective recovery tribunal. This is a serious loss to the bank.
Provision coverage ratio it has increased initially but decreased from 2014-2016. The provision
coverage ratio (PCR), a measure of the funds set aside by banks to cover bad loans, has declined
steeply in the past three years for almost all public sector banks. A decline in the ratio means that
provisions have not been made to the extent of the rise in bad loans. Except for a few banks such as
State Bank of India, Central Bank of India and Indian Bank where PCR has remained more or less
stable or increased marginally since March 2013, the ratio has declined sharply at most public sector
banks.
Contingent liabilities to total liabilities it has increased initially but decreased from 2014-2016.
This is because Contingent liabilities are reduced from 2014-16.
Liquidity coverage ratio not applicable.

Analysis :

Deposit growth has declined substantially. It rose during the years 2012 to2014 but substantially it
declined from 2015 to 2016. The Industrial growth of deposits is higher in comparison to the UCO
bank growth .

The Industrial growth of advances is higher in comparison to the UCO bank advance growth . The
bank was growing at par with the industry during the year 2012 to 2014 but during the year 20152016, the growth of advances of UCO bank declined substantially.

The market share of deposit was same in the first three years i,e 2012 to 2014. But it declined
substantially after the year 2014.

The market share of advances was high in the first year i.e 2012. But it declined substantially after
the year 2012 and thereafter it remained the same.

The Credit deposit ratio has declined substantially during the five year starting from 2012. It suggests
that the capacity of banks to deploy in current asset declined during these substantial years.

Analysis:

The operating ratio for the past five years is low which is suitable for the company. However it
increased over a period of five years which is negative news for the company.

Cost of funds has decreased substantially over a period of five years which is positive for the
company. Cost of fund has decreased substantially from 0.0717 million rupees in 2012 to 0.0651
million rupees in 2016.

CHAIRMANS REPORT
Bank's Performance:

Global business of the bank stood at `342626 crore as of Mar'16, against `366149 crore as of Mar'15.
This is partly due to conscious decision taken for shedding the bulk deposits & focusing on more
sustainable retail business and also because of a slowdown in industrial credit offtake and poor
earnings growth.
Global deposits stood at `207118 crore as of Mar'16, against `214337 crore as of Mar'15.
Global advances stood at `135508 crore as of Mar'16, against `152812 crore a year ago.
Bank's CASA proportion was 31.68% of Total deposits .Savings deposits rose by 11.63% during the
financial year. Bank has grown by 17.89% and 43.25% in home loan and property loan respectively.
Bank registered a net loss of `2799 crore for FY 2015-16, against a net profit of Rs.1138 crore for
FY 2014-15. The difference is primarily due to the higher provisioning requirements for NPAs'. The
Bank has fully complied with asset classification and provisioning requirements in respect of all the
borrower accounts identified by RBI during asset quality review in the current financial year 201516.
The bank's clientele rose by 10% to reach 2.86 crore by Mar'16.
The bank has contributed to the government's inclusion ambitions by taking its schemes such as
PMJDY (72.25 lac accounts), PMSBY (10.60 lac enrolments), PMJBY (4.78 lac enrolments), APY
(31172 subscribers), to the needy people actively.

Future Course:
The FY 2016-17 will be the year of "Strategic Resource Alignment", and all efforts will be dedicated
towards fine-tuning the banks key resources viz. its Human resources, Technological resources and
knowledge resources to achieve its vision of emerging into the most preferred financial services brand, along
with establishing robust business models to generate profits sustainably.
The focus on increasing CASA, Retail business, improving Asset quality and expediting NPA recovery will
be retained to facilitate the above aspirations. The bank will also continue its emphasis on financial inclusion
and PS advances.
The bank is in the process of launching its POS business, and this is expected to impact the bank's CASA
growth positively. The bank, which is using technology to add value in all spheres, will also actualize its
business potential at the bottom of the pyramid, through technological innovations to achieve, financial
inclusion profitably.

Risk Management Practices

Credit Risk Management Policy:
Banks Credit Risk Management practices are based on policy directives duly approved by the Board which,
inter-alia, encompasses the following:
Credit Risk acquisition strategies & policies,
Credit approval processes.
Credit Risk monitoring processes.
Credit Risk control processes.
Operational Risk Management Policy:
In order to provide independent assessment of adequacy of and compliance with, banks established policies
and procedures adequate internal audit coverage is in place as a part of ongoing monitoring. The Audit
committee of the Board ensures the scope and frequency of the audit

programme . The Inspection

department develops and oversees the internal function.

All financial departments/business units have been informed to keep the RMD fully informed of new
developments, initiatives, products and operational changes to identify all associated risks at an early stage.
The Bank has been collecting the relevant operational risk loss data loss event types and business lines wise
to meet the requirement of Advanced Measurement Approaches. Bank has obtained membership of
CORDEx for accessing the external loss data.
As per RBI directives, the bank has been maintaining capital for operational risk under Basic Indicator
approach (BIA). The capital requirement as per BIA is Rs.1143.21 crores as on 31.03.2016.
Operational Risk Management Policy:

For this the Bank adopted policies approved by the Board for Domestic as well as Overseas
Branches.
Policy provides various limits on exposures. Local ALCO Committee of overseas centers takes care
of strategies and processes as per approved policy for overseas centers.
Periodic Reporting of full details of Banks exposure undertaken by the domestic and overseas
branches are sent to Head Office. Quarterly reporting with evaluation of risks are also made. Any
breaches from various prudential and other limits fixed by the Bank are also referred to H.O for
necessary approval.
The Banks policy is to maintain near square position in Forex. However various limits like daylight,
overnight in respective currencies as well as overnight open position limit in Indian rupees for the
Bank as a whole have been fixed and the same is monitored through periodic reporting.

SHARE PRICE ANALYSIS OF UCO BANK:

SHARE

2016
47.80

2015
45.45

2014
46.85

2013
46.85

2012
46.85

PRICE
Interpretation
The share price of the company was constant from 2012-2014. It then dropped by approx. 1 Rs in the year
2015, but again increased by 2 Rs. In the year 2016.
High and low for past 5 years
HIGH
LOW

BSE
115.75
27.80

NSE
115.60
27.40

SPREAD AND EFFECIENCY:

The net interest rate spread is the difference between the average yield a financial institution receives from
loans and other interest-accruing activities and the average rate it pays on deposits and borrowings. The net
interest rate spread is a key determinant of a financial institution's profitability. In simple terms, the net
interest spread is like a profit margin. The greater the spread, the more profitable the financial institution is
likely to be; the lower the spread, the less profitable the institution is likely to be. While the federal funds
rate plays a large role in determining the rate at which an institution lends immediate funds, open market
activities ultimately shape the rate spread.
In 2016 the interest spread was 4848.02 and in 2015 and 2014 it was 5562.45 and 6059.09.It means that
interest spread has gone down during the years. The bank should reduce the investments and increase the
profits. It should reduce the interest expenses.

PEER ANALYSIS:

OVERALL FINDINGS
The bank incurred a Net Loss of Rs. 2799 cr for the whole year ending 31.03.2016 compared to the net
profit of Rs.1138 cr for the corresponding previous year. Operating Profit for the year ended Mar, 2016 is
Rs. 3603 cr compared to Rs. 4910 cr for the last year.
Total provisioning and contingencies of bank increased to Rs. 6403cr compared to Rs. 3772cr for the last
year.
The banks total income stood at Rs. 20157 cr as of March 2016 compared to Rs. 21, 363cr last year. While
interest income from loans and advances stood at Rs.12293 cr; interest from investment stood at Rs. 5663 cr.
Net Interest income was Rs. 4848 cr as of Mar''16 against Rs. 5562 cr as of Mar''15. The Non-Interest
income earned is Rs. 1596 cr as on Mar''16 as compared to Rs. 2004 cr in the corresponding previous year.
The banks interest expenses marginally declined to Rs.13713cr for March 2016 from Rs.13797 cr in March
2015.Bank''s total expenses stood at Rs. 16554 cr as on Mar''16 against Rs. 16452 cr as of March, 2015.
The Banks cost of deposit declined to 6.11% and yield on advances increased to 10.17% as at March 2016
from 6.35% and 9.92% respectively in Mar''15. Cost to income ratio increased to 47.19% from 37.74%.
Net worth of the Bank has decreased to Rs. 9720 crore during the financial year ending 2015-16 from Rs.
11585 crore of the corresponding previous year. In 2015-16, Govt. of India infused Rs. 935 cr capital in the
bank by way of preferential allotment of Equity Shares on 30.3.2016 which was maintained in the Share
Application Money Account. (On 10.05.2016, Bank allotted 22,54,64,190 equity shares to the Government
of India on preferential basis at an issue price ofRs.41.47 per share determined in accordance with SEBI
ICDR Regulations,2009 against the capital contribution of Rs. 935 crore.)
As per Basel III framework, the Banks Capital Adequacy Ratio of 9.63 % as at 31.03.2016 was higher than
the regulatory requirement of 9%.

CONCLUSION
Comparison of UCO Bank with Peers on 5 year performance: -30% to -5%

APPENDIX
Standalone Balance Sheet

------------------- in Rs. Cr. ------------------Mar '16

Mar '15

Mar '14

Mar '13

Mar '12

12 mths

12 mths

12 mths

12 mths

12 mths

Total Share Capital

1,075.59

1,075.59

1,014.71

2,575.63

2,487.71

Equity Share Capital

Capital and Liabilities:

1,075.59

1,075.59

1,014.71

752.63

664.71

Share Application Money

935.00

0.00

0.00

0.00

0.00

Preference Share Capital

0.00

0.00

0.00

1,823.00

1,823.00

Reserves

8,145.71

10,863.64

9,498.61

6,435.57

5,517.72

Net Worth

10,156.30

11,939.23

10,513.32

9,011.20

8,005.43

207,118.24

214,336.71

199,533.55

173,431.05

154,003.49

Deposits
Borrowings

17,240.44

10,252.54

20,718.24

9,492.43

12,901.42

Total Debt

224,358.68

224,589.25

220,251.79

182,923.48

166,904.91

Other Liabilities & Provisions

Total Liabilities

8,001.90

8,778.71

7,646.68

6,045.51

4,980.05

242,516.88

245,307.19

238,411.79

197,980.19

179,890.39

Mar '16

Mar '15

Mar '14

Mar '13

Mar '12

12 mths

12 mths

12 mths

12 mths

12 mths

7,949.96

8,267.52

8,049.21

5,705.36

7,811.53

10,609.28

13,901.45

6,962.80

6,638.75

5,792.16

Assets
Cash & Balances with RBI
Balance with Banks, Money at Call
Advances

125,905.37

147,350.87

149,584.21

128,282.86

115,540.01

Investments

83,974.20

68,859.43

67,451.69

52,244.90

45,771.50

Gross Block

2,878.25

1,066.27

1,018.28

878.61

801.55

Revaluation Reserves

2,365.66

609.73

712.97

671.21

608.00

512.59

456.54

305.31

207.40

193.55

6.38

47.73

43.48

10.98

3.20

Net Block
Capital Work In Progress

Other Assets

13,559.09

6,423.64

6,015.08

4,889.93

4,778.46

Total Assets

242,516.87

245,307.18

238,411.78

197,980.18

179,890.41

66,248.60

80,491.60

79,564.93

70,026.51

52,074.69

85.73

111.00

103.61

95.51

93.01

Contingent Liabilities
Book Value (Rs)

Standalone Profit & Loss account

------------------- in Rs. Cr. ------------------Mar '16

Mar '15

Mar '14

Mar '13

Mar '12

12 mths

12 mths

12 mths

12 mths

12 mths

Income
Interest Earned

18,560.97

19,358.99

18,229.92

16,751.71

14,632.37

Other Income

1,596.31

2,003.54

1,320.51

952.17

965.56

Total Income

20,157.28

21,362.53

19,550.43

17,703.88

15,597.93

13,712.95

13,796.54

12,170.83

12,170.18

10,730.27

Employee Cost

1,835.31

1,641.67

1,547.53

1,393.27

1,383.06

Selling, Admin & Misc Expenses

7,271.70

4,651.03

4,211.89

3,435.10

2,297.80

136.58

135.50

109.63

87.15

78.12

Operating Expenses

2,840.95

2,655.78

2,439.20

2,176.63

2,056.23

Provisions & Contingencies

6,402.64

3,772.42

3,429.85

2,738.89

1,702.75

22,956.54

20,224.74

18,039.88

17,085.70

14,489.25

Mar '16

Mar '15

Mar '14

Mar '13

Mar '12

12 mths

12 mths

12 mths

12 mths

12 mths

-2,799.26

1,137.80

1,510.54

618.20

1,108.67

3,513.08

2,949.94

2,114.58

2,111.11

1,685.17

713.82

4,087.74

3,625.12

2,729.31

2,793.84

0.00

215.12

252.00

288.94

342.19

Expenditure
Interest expended

Depreciation

Total Expenses

Net Profit for the Year

Profit brought forward
Total
Equity Dividend

Corporate Dividend Tax

0.00

43.01

42.83

49.11

55.51

-26.03

10.58

0.00

20.00

14.89

8.21

16.68

30.00

16.00

30.00

85.73

111.00

103.61

95.51

93.01

-14.35

316.53

380.36

276.68

285.03

0.00

0.00

-0.01

0.00

0.00

Per share data (annualised)

Earning Per Share (Rs)
Equity Dividend (%)
Book Value (Rs)
Appropriations
Transfer to Statutory Reserves
Transfer to Other Reserves
Proposed Dividend/Transfer to Govt

0.00

258.13

294.83

338.05

397.70

Balance c/f to Balance Sheet

728.18

3,513.08

2,949.94

2,114.58

2,111.11

Total

713.83

4,087.74

3,625.12

2,729.31

2,793.84