Final of Rohit

PROJECT ON
PANJAB NATIONAL BANK
PREPARED BY
ROHIT SURESH JAIN
ROLL NO : 13
TYBCOM (BANKING & INSURANCE)
SEMESTER- V YEAR ( 2015 -2016)
UNDER GUIDANCE OF
Ms.TRUPTI
SUBMITTED TO
SHREE SHANKAR NARAYAN COLLEGE
OF PROFESSIONAL COURSES.
NAVGHAR ROAD, BHAYANDER (E),THANE 401105
.(AFFILIATED TO UNIVERSITY OF MUMBAI )
PUNJAB NATIONAL BANK [Type text] 1

ACKNOWLEDGMENT
It gives me a great pleasure to present the project on. I thank my

honourable guide for her guidance PROF.TRUPTI who trusts me &
gives me opportunity to making this project. I take his opportunity
to express my sincere appreciation & gratitude to the college
librarian i also thank full to the managers & concern authority of
banks that has give me their valuable time & provide me information
also thank full my friends who are helping me successfully. I am
highly obliged to acknowledge our principal DR.V.N.YADAV and
our B.B.I coordinator PROF.VIVEK WANKHADE. For given me an
opportunity to conduct a detail study and analysis of the topic
relevant to my project.
Last but not the least ; I would like to thank all those who have
shown keen interest in the project and provided their guidance from
time to time.
I would like to appreciate the efforts of library staff and my friends

that have helps me in the completion of this project.

Sr. no TOPIC PAGE NO
1 General Information about the Company
2 Structure of Indian Banking Industry
3 Business should respect, protect, and make

efforts to restore the environment
4 Financial Details of the Company
5 Risk
6 CASE STUDY
7 CONCLUSION & RECOMMENDATION
8 BIBLIGRAPHY

INTRODUCTION
Punjab National Bank is an Indian financial services company based in New
Delhi, India. Founded in 1894, the bank has over 6,300 branches and over
7,900 ATMs across 764 cities. It serves over 80 million customers.[3]
Punjab National Bank is one of the Big Four banks of India, along with State Bank of
India, ICICI Bank and Bank of Baroda. It is the third largest bank in India in terms of
asset size ( billion by the end of FY 2012-13). The bank has been ranked 248th
biggest bank in the world by the Bankers' Almanac.
PNB has a banking subsidiary in the UK (PNB International Bank, with seven
branches in the UK), as well as branches in Hong Kong, Kowloon, Dubai and Kabul.
It has representative offices
in Almaty (Kazakhstan), Dubai, Shanghai (China),Oslo (Norway)
and Sydney (Australia). In Bhutan it owns 51% of Druk PNB Bank, which has five
branches. PNB owns 20% of Everest Bank Limited, which has 50 branches in Nepal.
Lastly, PNB owns 84% of JSC (SB) PNB Bank in Kazakhstan, which has four
branches.

Chapter 1
General Information about the Company
Introduction
Corporate Identity Number (CIN) of the Company - Not Applicable
1Name of the Company - Punjab National Bank
2Registered address-Punjab National Bank,Head Office, 7 Bhikhaiji Cama
3Place,- New Delhi-110607
4. Website - www.pnbindia.in
5. E-mail id - eicmasd@pnb.co.in, cmd@pnb.co.in
6. Financial Year reported - 2012-13
7. Sector(s) that the Company is engaged in (industrial activity code-wise)
Sn Sector
1 Banking Services
2 Credit Cards
3 Govt Business
4 Merchant Banking
5 Agency Business- Insurance, Mutual Funds etc.

8 List three key products/services that the Company manufactures/provides (as
in balance sheet)
The Bank offers wide range of products and services to its customers serving various
needs and
aspirations. Some of the key products offered are:
Deposits
_ Current Accounts
_ Savings Fund Account
_ Term Deposit Account

Advances

_ Cash Credit
_ Term loans
_ Bills Discounting
_ Letters of Credit
Ancillary Services
_ Lockers
_ Depository Services
_ Life and Non life Insurance Business
_ Mutual Funds
9. Total number of locations where business activity is undertaken by the Company

a. Number of International Locations (Provide details of major 5)
Types of Sn Destination
Office
Branches 1 Offshore Banking Unit, Mumbai
2 Kabul, Afghanistan
3 Hong Kong Main
4 Kowloon Hong Kong
5 DIFC, Dubai
Subsidiary 1 PNBIL, UK (7 branches)
2 DRUK PNB Ltd., Bhutan (5 Branches)
3 JSC SB PNB, Kazakhstan (4 Branches)
Joint Venture 1 Everest Bank Limited, Kathmandu, Nepal (48 Branches)
Rep. Offices 1 Almaty, Kazakhstan
2 2 Shanghai, China
3 3 Dubai, UAE
4 4 Oslo, Norway
5 5 Sydney, Australia
b. Number of National Locations

PNB has 10 FGMOs, 68 circle offices, 5874 Branch offices including extension
counters and
6313 ATMs as on 31st March 2013.
10. Markets served by the Company Local/State/National/International
National and International markets with large branch network.
Background

In India, the definition of the business of banking has been given in the Banking
Regulation Act, (BR Act), 1949. According to Section 5(c) of the BR Act, 'a banking
company is a company which transacts the business of banking in India.' Further,
Section 5(b) of the BR Act defines banking as, 'accepting, for the purpose of lending
or investment, of deposits of money from the public, repayable on demand or
otherwise, and withdrawable, by cheque, draft, and order or otherwise.'
Banking is the business of providing financial services to consumers, The basic

services a bank provides are saving account, Time deposit, Loans that consumers can
use to purchase goods and services and basic cash management services such as
foreign currency exchange.
Banking Industry at a Glance
The commercial banking industry in India started in 1786 with the establishment of
the Bank of Bengal in Calcutta. The Indian Government at the time established three
Presidency banks, viz., the Bank of Bengal (established in 1809), the Bank of Bombay
(established in 1840) and the Bank of Madras (established in 1843). In 1921, the three
Presidency banks were amalgamated to form the Imperial Bank of India, which took
up the role of a commercial bank, a bankers' bank and a banker to the Government.
The Imperial Bank of India was established with mainly European shareholders. It was
only with the establishment of Reserve Bank of India (RBI) as the central bank of the
country in 1935, that the quasi-central banking role of the Imperial Bank of India came
to an end.
To better align the banking system to the needs of planning and economic policy, it
was considered necessary to have social control over banks. In 1969, 14 of the major
private sector banks were nationalized. This was an important milestone in the history
of Indian banking. This was followed by the nationalization of another six private
banks in 1980. With the nationalization of these banks, the major segment of the
banking sector came under the control of the Government. The nationalization of
banks imparted major impetus to branch expansion in un-banked rural and semi-urban
areas, which in turn resulted in huge deposit mobilization, thereby giving boost to the

overall savings rate of the economy. It also resulted in scaling up of lending to
agriculture and its allied sectors. However, this arrangement also saw some
weaknesses like reduced bank profitability, weak capital bases, and banks getting
burdened with large non-performing assets.
To create a strong and competitive banking system, a number of reform measures were
initiated in early 1990s. The thrust of the reforms was on increasing operational
efficiency, strengthening supervision over banks, creating competitive conditions and
developing technological and institutional infrastructure. These measures led to the
improvement in the financial health, soundness and efficiency of the banking system.
One important feature of the reforms of the 1990s was that the entry of new private
sector banks was permitted. Following this decision, new banks such as ICICI Bank,
HDFC Bank, IDBI Bank and UTI Bank were set up.

Chapter 2
Structure of Indian Banking Industry
INTRODUCTION
The Reserve Bank of India (RBI) is the central banking and monetary authority of
India, and also acts as the regulator and supervisor of commercial banks.Scheduled
banks comprise scheduled commercial banks and scheduled co-operative banks.
Scheduled commercial banks form the bedrock of the Indian financial system,
currently accounting for more than three-fourths of all financial institutions' assets.
SCBs are present throughout India, and their branches, having grown more than four-
fold in the last 40 years now number more than 80,500 across the country (see Table
1.1). Our focus in this module will be only on the scheduled commercial banks. A

pictorial representation of the structure of SCBs in India is given in figure
Sources of risks considered in the model

Signals for credit risks can be picked up from a number of sources. The credit risk-
rating model considers the following broad areas in evaluating the default risk of a
borrower:
Financials Quality of Management
Business Performance Conduct of Account
Industry Outlook

The rating model is focused on the above-mentioned areas for assessing the credit risk
rating of a company. The areas are bifurcated into sub-areas and each sub-area is
further split into a number of parameters. The sub-areas as well as parameters used in
the different sections have been explained in detail in the following part of the report.
There are various models adopted for different projects and accounts which are
categorized and briefly explained below:
Credit Risk Applicability

RatingModel Total Limits from our Sales Sector
Bank
Large Corporate Above Rs. 15 Crore OR Above Rs.100 Crore Manufacturing and
Service
Mid Corporate Above Rs. 5 Cr and up Above Rs. 25 Cr. and Manufacturing,
to Rs. 15 Cr. OR
Up to Rs.100 Cr. for Service and
manufacturing and service
Trading
industry and irrespective
of limit in case of trading
activities.
Small Loans Above Rs.50.00 lakh Up to Rs.25 Cr. All sectors except NBFC/
and Up to Rs.5 Crores Banks/FIs
AND
Small Loans II Above Rs. 2 lakhs & up Up to Rs.25 Cr. All sectors except NBFC/
to Rs. 50 lakh AND Banks/FIs
NBFC All Non Banking Financial Companies irrespective of Limit
New Projects Above Rs. 5 Cr Cost of Project above All sectors, except
Rs.15Cr. NBFC/Banks/FIs and
OR
trading up to two years of
operations.
Entrepreneur Borrower setting up Cost of project up to Rs. All sectors, except

New Business new business and 15 cr. NBFC/Banks/FIs. However,
requiring finance above all new trading business
Rs. 20 lakh and up to irrespective of limits shall be
Rs. 5 cr. AND rated under this model.

Half Yearly Applicable to all listed companies as well as all accounts having exposure from our
Review of bank (Fund Based+Non Fund Based) of above Rs. 50 crore
Rating
Counter Party All banks and Financial Institutions
Table 1: Credit Risk Rating Entity Model
As shown in the Table above, the bank considers different business clients as different
type of entities based on a certain criteria. These parameters are explained as follows:
Large Corporates: The clients who have net sales of over Rs. 100 crore are
categorized in this class. This class is qualified to avail limits of more than Rs.
15 crore from the bank. This class generally has clients from Manufacturing
and Service sectors.
Mid Corporates: The clients who have net sales between Rs 25 crore and Rs
100 crore are categorized as Mid Corporates. This class is qualified for limits
between Rs 5 crore and Rs 15 crore. This class generally has clients from
Manufacturing, Trading and Service sectors.
Small Loans-I: The firms that have sales upto Rs 25 crore can be classified as
Small Loans-I clients. These can avail limits ranging from Rs 50 lakh to Rs 5
crore. This class is applicable to all the sectors except NBFC/Bank/FIs.
Small Loans-II: The firms that have sales upto Rs 25 crore can be classified
as Small Loans-II. These can avail limits ranging from Rs 2 lakh to Rs 50 lakh
from the bank. This class is applicable to all the sectors except
NBFC/Bank/FIs.
NBFC: There is no limit to this category in terms of sales or limits. This
category is specially reserved for Non Banking Financial Companies (NBFC).
New Projects: This class has clients that have cost of project more than Rs 15
crore. A limit of over Rs 5 crore can be availed by these firms. All sectors are
applicable in this class except NBFC/Banks/FIs and trading firms for the first
two years of operations.
Entrepreneur New Business: The new projects that cost less than Rs 15 crore
qualify for this class. Funding of the project that can be availed by the bank
lies between Rs 20 Lakh and Rs 5 crore.
Counter Party: All banks and financial Institutions
Usage of the credit risk

The following text describes the basic rating procedure followed when implementing
the rating model for a client.
1. The scores are assigned to each of the parameters in the different sections on a
scale of 0 to 4 up to two decimal points with 0 being very poor and 4 being
excellent. The scoring of some of these parameters is subjective while for
some others it is done on the basis of pre-defined objective criteria.
Wherever a particular parameter is not applicable, no score should be given.
The parameter should be made NA so that the weight assigned to that
parameter gets distributed among the other parameters in that section
automatically.
2. The scores given to the individual parameters multiplied by allocated weights

are aggregated and a composite score for the company is arrived at in
percentage terms. Weights have been assigned to different parameters based
on their importance.
The following table shows the various parameters and the weights assigned to
them:
S No. Factor Weight Assigned

1 Financial 40
2 Business / Industry 20
3 Management 20
4 Conduct of Account 20
Total 100
3. The overall percentage score obtained from step 2 on a scale of 0 to 100 is

then translated into a rating on a scale from AAA to D according to a pre-
defined range as under:
Rating Risk Profile Score (%) obtained Grade within the
category (Description) rating category

PNB Minimum Risk
Above 80.00 PNB- AAA
AAA
PNB-AA Marginal Risk Above 77.50 up to 80.00 PNB- AA+
Above 72.50 up to 77.50 PNB- AA
Above 70.00 up to 72.50 PNB- AA-
PNB-A Modest Risk Above 67.50 up to 70.00 PNB- A+
Above 62.50 up to 67.50 PNB- A
Above 60.00 up to 62.50 PNB- A-
PNB-BB Average Risk Above 57.50 up to 60.00 PNB- BB+
Above 52.50 up to 57.50 PNB- BB
Above 50.00 up to 52.50 PNB- BB-
PNB-B Marginally Above 47.50 up to 50.00 PNB- B+

Acceptable Risk Above 42.50 up to 47.50 PNB- B
CHAPTER 4
Financial Details of the Company

1 Paid up Capital (INR) - Rs 353.47 Crore
2 Total Business (INR) - Rs 700285 Crore
3 Total profit after taxes (INR) - Rs 4747.52 Crore
4. Total Spending on Corporate Social Responsibility (CSR) - as percentage of profit
after tax (%)During FY13 the total spending on CSR activities was Rs 324.43 lakhs
on 1624 activities. This constituted .07% of Profit after Tax.
5. List of activities in which expenditure in 4 above has been incurred:-
a. Medical Camps
b. Health Camps for Farm animals
c. Farmers Training including visits of farmers to Agriculture Universities.
d. Tree Plantation
e. Blood Donation Camps
f. Distribution of Artificial Limbs

g. Adoption of New Born Care and Malnutrition ward at Government Hospital, Sikar,
Rajasthan.
Other Details
1. Does the Company have any Subsidiary Company/ Companies?

Yes the company has five domestic subsidiaries viz:
a. PNB Gilts Ltd.
b. PNB Housing Finance Ltd.
c. PNB Investment Services Ltd.
d. PNB Insurance Broking Pvt. Ltd.*
e. PNB Life Insurance Company Ltd.#
* PNB Insurance Broking Pvt. Ltd is non functional. The broking License has been
surrendered and steps are
being taken for winding up of the company.
# The Company is under liquidation
The three international subsidiaries of the Bank are:
a. Punjab National Bank (International) Ltd, UK.

b. Druk PNB Bank Ltd
c. JSC SB PNB Kazakhstan
2. Do the Subsidiary Company/Companies participate in the BR Initiatives of the
parent company?
If yes, then indicate the number of such subsidiary company(s)
No.
3 Do any other entity/entities (e.g. suppliers, distributors etc.) that the Company
does business
with, participate in the BR initiatives of the Company? If yes, then indicate the
percentage of
such entity/entities? [Less than 30%, 30-60%, More than 60%]
No
Details of Director

1. Does the policy relating to ethics, bribery and corruption cover only the company?
Yes/ No.
Does it extend to the Group/Joint Ventures/ Suppliers/Contractors/NGOs /Others?
The Bank considers Corporate Governance as an integral part of good management.
The Bank
has an accountability policy which covers ethics, bribery, corruption and related
issues.
This being the first year the policy is presently applicable to the Bank. However it
will be
gradually extended to cover subsidiaries.
2. How many stakeholder complaints have been received in the past financial year and
what
percentage was satisfactorily resolved by the management? If so, provide details
thereof, in
about 50 words or so.
55433 complaints were received from stakeholders during the current year. Out of
these
54956 complaints have been resolved.
Principle 2: Businesses should provide goods and services that are safe and contribute
to
sustainability throughout their life cycle
1. List up to 3 of your products or services whose design has incorporated social or
environmental
concerns, risks and/or opportunities.
Being a service organization, the Bank does not deal with products which are
hazardous in nature. However there are certain financial products which have
relevance for the
marginalized sections of society:
1. Biometric Smart Cards: They enable an illiterate to withdraw money from his Bank
account. The system identifies the individuals on the basis of fingerprints.
2. PNB Kalyani Cards: They are given to women in rural areas for their general needs
and
upliftment.

3. PNB Krishak Sathi: It is a loan scheme for farmers to liberate them from
indebtedness at
the hands of the moneylenders.
4. Internet banking: It allows customers to access their Bank accounts from across the
world.
It is paperless and as such an eco-friendly channel of delivery.
2. For each such product, provide the following details in respect of resource use
(energy, water,
raw material etc.) per unit of product(optional):
i. Reduction during sourcing/production/ distribution achieved since the previous year
throughout the value chain?
ii. Reduction during usage by consumers (energy, water) has been achieved since the
previous year?
As the Bank deals in services, this section is not applicable.
3. Does the company have procedures in place for sustainable sourcing (including
transportation)? If yes, what percentage of your inputs was sourced sustainably? Also,
provide
details thereof, in about 50 words or so.
The Bank believes in protecting the environment.
The first step in this direction has been taken by setting up a Green Lobby at
our branch at
Bhikhaiji Cama Place, New Delhi. The Cash Deposit Machine, Passbook Updation
Machine and
Cheque Deposit Machine installed in the lobby are all powered by solar energy. Bank
will be
taking further action to increase the use of solar energy for powering its machines.
4. Has the company taken any steps to procure goods and services from local & small
producers, including communities surrounding their place of work?
If yes, what steps have been taken to improve their capacity and capability of local
and small
vendors?
The Bank provides services at its branches across India and thus serves the
various

communities that fall within the service area of its branches. Given the nature of its
business,
there is little scope for sourcing from local vendors. However, the Bank does
encourage its
MSME borrowers to source the bulk of their inputs from micro enterprises.
5. Does the company have a mechanism to recycle products and waste? If yes what is
the percentage of recycling of products and waste (separately as <5%, 5-10%, >10%).
Also, provide details thereof, in about 50 words or so.
The Bank has an e-waste disposal policy. E-waste dealers/recyclers have been
approved for
disposing of old and obsolete computers, servers, monitors, printers, fax machines,
ATMs,
UPSs, etc. The branches and administrative offices are disposing of their hardware
using the
services of these dealers.
Old records that have outlived their utility and are earmarked for destruction
are disposed by
sales to approved agencies that recycle the paper.
1. Please indicate the Total number of employees.

The total number of employees as on 31st March 2013 is 63415.
2. Please indicate the Total number of employees hired on
temporary/contractual/casual basis.
The Bank does not hire employees on temporary/contractual/casual basis.
3. Please indicate the Number of permanent women employees.
The total number of permanent women employees as on 31st March 2013 is 11594.
4. Please indicate the Number of permanent employees with disabilities
The Number of permanent employees with disabilities as on 31st March 2013 is
919.
5. Do you have an employee association that is recognized by management?
No employee association has been recognized by the Bank. However the following
two
majority Unions/Associations represent the workmen/officers staff.

_ All India PNB Employee Federation.
_ All India PNB Officers Association.
6. What percentage of your permanent employees is members of this recognized
employee
association?
Nearly 76% of PNBs employees are members of employee associations.
7. Please indicate the Number of complaints relating to child labour, forced labour,
involuntary labour, sexual harassment in the last financial year and pending, as on the
end of the financial year.
Sn. Category No of Complaints No of Complaints

filed during the pending as on end of
financial year the financial year
Child labour/forced Nil Nil
1 labour
/involuntary labour
2 Sexual harassment 2 Action has been

taken
3 Discriminatory Nil Nil

employment
8. What percentage of your under mentioned employees were given safety & skill up-
gradation training in the last year?

A. Permanent Employees : 95%
B. Permanent Women Employees: 11.5%
C. Casual/Temporary/Contractual Employees: NA
D. Employees with Disabilities: 0.56%
A soft skills training programme, 'I am PNB, has reached out to almost all employees
during the year 2012-13.
Principle 4: Businesses should respect the interests of, and be responsive towards all
stakeholders, especially those who are disadvantaged, vulnerable and marginalized.
1. Has the company mapped its internal and external stakeholders? Yes
Shareholders are divided into different subsets, viz., Government, Foreign
Institutional
Investors, Financial Institutions, Insurance Companies, Mutual Funds, Banks and
Individuals.
Customers are segmented into large corporate, mid-corporate, small and medium
enterprises
and retail customers. Dedicated branches provide service to these segments.
Retail customers are further segmented into premier customers and other customers.
The HR division looks after the interests of the Bank employees.
CSR initiatives reach out to communities in which the Bank operates.
2. Out of the above, has the company identified the disadvantaged, vulnerable &
marginalized
stakeholders?
The Bank has identified the disadvantaged, vulnerable and marginalized
stakeholders. Some
of these are the Small and Marginal Farmers, Tenant Farmers and Oral-Lessee
Farmers, Landless Labourers and rural women, all of whom are provided credit under
special credit
schemes such as Kisan Credit Card, General Credit Card, PNB Kalyani Card (for the
upliftment
of rural women), PNB Tatkal scheme (for the small farmer in need of immediate
credit) and
PNB Krishak Sathi Scheme (with the objective of liberating farmers from the clutches
of rural
moneylenders).

3. Are there any special initiatives taken by the company to engage with the
disadvantaged,
vulnerable and marginalized stakeholders. If so, provide details thereof, in about 50
words or
so.
The Bank reaches out to the financially excluded through its Business
Correspondents and has
developed technology for these segments. The Bank has tied up with technology
service
providers to capture the Bio-metrics (fingerprints) of these customers enabling them
make
withdrawals at their doorstep on visit by the BCs.
The Bank is also continually upgrading its Financial Inclusion capabilities. Recently
a Kiosk
Banking Solution has been put in place in remote villages to make on-line banking
services
available at affordable costs to the underprivileged.
The Bank is taking steps to implement the Swavalamban Scheme of the Government
of India,
which aims to provide micro pension to the unorganized sector. 5200 branches under
61
circles have already been registered for implementation of the scheme and more than
2000
beneficiaries have been enrolled.
RSETIs provide vocational training to poor villagers, particularly women.
Improving Financial Literacy: The Financial Literacy and Credit Counseling Centres
(FLCCs)
established by the Bank, provide wide range of financial counseling to its customers.
Principle 5: Businesses should respect and promote human rights
1. Does the policy of the company on human rights cover only the company or extend
to the
Group/Joint Ventures/Suppliers/Contractors/NGOs/Others?
The Bank does not have a stated Human Rights Policy. However these aspects are
covered

under the Human Resource policies and practices of the Bank.
2. How many stakeholder complaints have been received in the past financial year and
what
percent was satisfactorily resolved by the management?
The total number of stakeholder complaints received during the year was 55433 out
of which
the Shareholders complaints were 122, employee complaints were 766 and customer
complaints were 54545.
More than 99% of these complaints were resolved.
Chapter 3
Business should respect, protect, and make efforts to restore the

environment
1. Does the policy related to Principle 6 cover only the company or extends to the
Group/Joint Ventures/Suppliers/Contractors/NGOs/others.
The Bank has a Green initiatives policy, which lists a series of small routine
actions that can be taken to work in harmony with the environment.
2. Does the company have strategies/ initiatives to address global environmental
issues such as climate change, global warming, etc? Y/N. If yes, please give hyperlink
for webpage etc.
The Bank shares the global concern about environmental issues and this is reflected
in many of the CSR initiatives it has taken. The Van Mahotsav, tree plantation camps,
plantation along road sides, greening of traffic circles in different cities and

maintenance of parks in residential areas are some of the initiatives the Bank has
taken in this direction.
Some of the other initiatives can be found in the Corporate Social Responsibility
Report, the Hyperlink for which is https://www.pnbindia.in/En/ui/SocialBanking.aspx
3. Does the company identify and assess potential environmental risks? Y/N
Presently this is not being done. However, the Bank is committed to reducing its
carbon footprint at its places of operation.
4. Does the company have any project related to Clean Development Mechanism? If
so, provide details thereof, in about 50 words or so. Also, if Yes, whether any
environmental compliance report is filed?
Given the nature of the Banks business, the Bank does not have a Clean
Development Mechanism project.
5. Has the company undertaken any other initiatives on clean technology, energy
efficiency, renewable energy, etc. Y/N. If yes, please give hyperlink for web page etc.
Bank promotes renewable energy projects by extending finance to solar and wind
energy projects at a concessional rate.
Bank is exploring scope for rain water harvesting in its existing/new buildings.
Bank has installed energy efficient equipments in some of its office buildings.
Electricity audit of all offices has resulted in efficient functioning with cost benefits.
Our CMD has signed Green Initiative (an initiative of Ministry of New and
Renewable Energy) on behalf of the Bank.
Bank has taken steps to reduce wastage of resources and energy. MARD (HO)
conducts risk based management audit of the administrative offices of the Bank on
Green Initiatives.
6. Are the Emissions/Waste generated by the company within the permissible limits
given by CPCB/SPCB for the financial year being reported?
The Bank being a financial institution is not required to seek environmental
clearance for its operations from the CPCB. However, DG sets at Head Office and
other offices are checked by the Delhi Pollution Control Committee to monitor noise
levels and these have been found to be in order.
7. Number of show cause/ legal notices received from CPCB/SPCB which are
pending (i.e. not resolved to satisfaction) as on end of Financial Year.
Nil

Principle 7: Businesses, when engaged in influencing public and regulatory policy,
should do so in a responsible manner
1. Is your company a member of any trade and chamber or association? If Yes, Name
only those major ones that your business deals with:
The Bank is a member of:
a. Indian Banks Association (IBA)
b. Federation of Indian Chambers of Commerce and Industry (FICCI)
c. International Chamber of Commerce (ICC)
d. The Associated Chambers of Commerce and Industry of India (ASSOCHAM)
e. Confederation of Indian Industry (CII)
2. Have you advocated/lobbied through above associations for the advancement or
improvement of public good? Yes/No; if yes specify the broad areas (drop box:
Governance and Administration, Economic Reforms, Inclusive Development Policies,
Energy security, Water, Food Security, Sustainable Business Principles, Others).
In the field of economic reforms, the Bank has advocated policies that would be
socially beneficial.
Principle 8: Businesses should support inclusive growth and equitable development

1. Does the company have specified programmes/initiatives/projects in pursuit of the
policy related to Principle 8? If yes details thereof.
The Bank has taken an active role to promote Financial Inclusion. It has covered all
the 4588 villages allotted to it by the Government of India under Swabhiman, the
financial inclusion plan. The Bank through its Business Correspondents and
Technology Service Providers is bringing banking services to the doorsteps of the
underprivileged.
The Bank has 2232 rural branches with more than 30000 villages in the service area
of its villages. The Bank is looking after the banking needs of these villages through
its branches and contributing to their development.
The Bank has opened almost 90 lac Basic Savings Bank Deposit Accounts, for
excluded sections who did not have access to banking facilities.
Farmers Training Centres (FTCs): These training centres provide training to farmers
and make them aware of latest developments in agriculture and spread the message of
improving productivity in harmony with the environment. During FY13, these

RSETIs conducted 967 training programmes and trained 30267 trainees. 49% of these
trainees were in the BPL category.
Rural Self Employment Training Institutes (RSETIs): There are 44 RSETIs at
present. These training institutes provide vocational training to the rural women and
youth and prepare them for taking up gainful employment.
Financial Literacy Centres: There are presently 100 FLCs which have conducted
programmes attended by 264371 individuals during FY-13. They have given advice
on deposit and credit products and on debt related issues.
The Bank has been actively associated with financing of various Govt. sponsored
programmes, especially NREGA project, funding of social sectors like education,
health, etc.
PNB Vikas is a village adoption scheme. Under the scheme, 120 villages have been
adopted so far.
Some of the other initiatives undertaken by Bank for improving the lot of the
underprivileged include:
a) PNB JANMITRA Project: Under this project the Bank provides credit support to
rickshaw pullers.
b) Weavers Project, Varanasi: Under this project, Bank is encouraging weavers and
helping them to become self reliant.
2. Are the programmes/projects undertaken through in-house team/own
foundation/external NGO/government structures/any other organization?
The Banks CSR projects are undertaken through an internal team as well as in
partnership with NGOs and Government Institutions.
PNB PRENA is one such initiative in the form of an association of the wives of the
Top executives which undertakes CSR activities in association with various Non
Governmental Organizations.
1. Does the company have specified programmes/initiatives/projects in pursuit of the
policy related to Principle 8? If yes details thereof.
The Bank has taken an active role to promote Financial Inclusion. It has covered all
the 4588 villages allotted to it by the Government of India under Swabhiman, the
financial inclusion Business Responsibility Report 13 plan. The Bank through its
Business Correspondents and Technology Service Providers is bringing banking
services to the doorsteps of the underprivileged.

The Bank has 2232 rural branches with more than 30000 villages in the service area
of its villages. The Bank is looking after the banking needs of these villages through
its branches and contributing to their development.
The Bank has opened almost 90 lac Basic Savings Bank Deposit Accounts, for
excluded sections who did not have access to banking facilities.
Farmers Training Centres (FTCs): These training centres provide training to farmers
and make them aware of latest developments in agriculture and spread the message of
improving productivity in harmony with the environment. During FY13, these
RSETIs conducted 967 training programmes and trained 30267 trainees. 49% of these
trainees were in the BPL category.
Rural Self Employment Training Institutes (RSETIs): There are 44 RSETIs at
present. These training institutes provide vocational training to the rural women and
youth and prepare them for taking up gainful employment.
Financial Literacy Centres: There are presently 100 FLCs which have conducted
programmes attended by 264371 individuals during FY-13. They have given advice
on deposit and credit products and on debt related issues.
The Bank has been actively associated with financing of various Govt. sponsored
programmes,
especially NREGA project, funding of social sectors like education, health, etc.
PNB Vikas is a village adoption scheme. Under the scheme, 120 villages have been
adopted so far.
Some of the other initiatives undertaken by Bank for improving the lot of the
underprivileged include:
a) PNB JANMITRA Project: Under this project the Bank provides credit support to
rickshaw pullers.
b) Weavers Project, Varanasi: Under this project, Bank is encouraging weavers and
helping them to become self reliant.
2. Are the programmes/projects undertaken through in-house team/own
foundation/external NGO/government structures/any other organization?
The Banks CSR projects are undertaken through an internal team as well as in
partnership with NGOs and Government Institutions.
PNB PRENA is one such initiative in the form of an association of the wives of the
Top executives which undertakes CSR activities in association with various Non
Governmental Organizations.

Chapter 4
BUILDING CONTRUCTION OF PUNJAB NATIONAL BANK
Brief :
Bank is having Basement,-1floor, GF and upper eight floors in Head office building, 7
Bhikaiji Cama Place, New Delhi with a total built up area of about 170000.00 sq. ft.
This includes Central AC system and fire fighting system etc. Building is fully
occupied and various departments of Punjab National Bank are functioning from the
said building.
Project:
Punjab National Bank intends to do Renovation and Furnishing work along with other
allied works at G.F, 2nd, 3rd, 4th, 5th & 8th Floor of Head office building, 7 Bhikaiji
Cama Place, New Delhi. The Tentative cost of the work is Rs. 2000.00 Lacs.

Time that shall be taken for such magnitude/nature of job after entering into
agreement to completion of work shall be 24 months as work is to be executed in
phases in a functional building.
Expression of interest is invited only from Central Govt. or a Central Govt.
Undertaking to take up the above mentioned work at New Delhi as a Deposit
Work on Turn key basis including Architectural services. Interested Central
Govt. Agencies/Undertakings, who have executed at least one work of similar nature
amounting to Rs.1600 lakh on tunkey basis or two works of similar nature amounting
to Rs.1000 lakhs on turn key basis or three similar work amounting to Rs.800 lakh
each on turn key basis in the last three years, may submit their EOI as under:-
A. For undertaking the above mentioned Renovation & Furnishing work as a
Deposit Work on Total Turn key basis.
The profile of the interested agency along with details of similar works executed on
turn key basis supported with completion certificates showing amount may be
submitted in separate sealed cover super scribing as Envelope No.1.for Renovation
and Furnishing work along with other allied works of G.F, 2nd, 3rd, 4th, 5th & 8th
Floor of Head office building, 7 Bhikaiji Cama Place, New Delhi.
The Agency charges in percentage for the services for the following may be
submitted in sealed cover super scribing as Envelope No.2 for Renovation and
Furnishing work along with other allied works of G.F, 2nd, 3rd, 4th, 5th & 8th Floor
of Head office building, 7 Bhikaiji Cama Place, New Delhi.
Before quoting the agency charges intending parties are requested to visit the site
and acquaint themselves with the site conditions/working conditions.
For undertaking deposit work on turn-key basis with Arhitectural services.
(----- % of actual cost)
The draft agreement, indicating terms & conditions to undertake the said work as a
deposit work, proposed by the Bank is as Annexure B below.
Envelope No 2 for only those Agencies will be opened who are finally approved by
the Bank for assigning this work as deposit work.
For any further information or clarification, you may contact Asstt. General Manager,
GAD, PNB Head Office, 6th Floor, 7, Bhikaiji Cama Place, New Delhi. Phone
No.26168503, 26102303/ Extn.-227.
Bank reserves the right to accept or reject any or all agencies without assigning any

reason whatsoever. The last date of receipt of applications will be 30 days from the
date of release of press advertisement.
RESPONSIBILITIES OF THE EXECUTING AGENCY

The planning, designing of the project shall be done by the Executing Agency
after getting the design concept and detailed specifications approved from
Employer. The Executing Agency shall also get the work executed as per the
drawings "Good for Execution" and other details. The Executing Agency shall
be responsible for getting local body approvals, if required.
Subsequent to signing of the agreement, the Executing Agency shall forthwith
take possession of the site from the Employer in phased manner on mutually
agreed terms and shall nominate a responsible Engineer for execution of the
project under intimation to the Employer.
Executing Agency shall prepare preliminary estimates of cost of the various
items of work as required by Employer on CPWD plinth area rates (where ever
applicable) enhanced by the cost index of the area and market rate analysis
for items which are not included in CPWD, PAR, to be worked out as per
standard methods.
Executing Agency shall execute the works at preliminary estimated cost
inclusive of agency charges for project management and planning, designing,
consultancy services. In case at detailed design/ execution stage, if there is an
increase in this anticipated cost, the Execution Agency shall submit the details
of the same with the supporting documents and technical/administrative
justification to the Employer.
Executing Agency shall prepare the tender documents comprising the
technical specification BOQ, General Terms and Conditions, Special Conditions
etc. for inviting tenders.: 4 :
Executing Agency shall be wholly and solely responsible for any
observations/Comments/defects pointed out by C.T.E/C.V.C. in the
procedures of execution of this project.
The Executing Agency shall be wholly, solely and fully responsible for the
timely completion of the project, the quality of work as per tender

specification and also the structural safety during & after completion of
the project.
It is understood that the Employer or any person authorized by them may
inspect and check the Renovation & Furnishing work from time to time to
see that the buildings are being constructed as per drawings &
specifications as provided in the Banks approved Estimate. If any defects
or variation made without the written request of the Employer or are
found during the inspection, they will be rectified within 30 (thirty) days
from its receipt. During the various stages of execution, Executing Agency
shall submit monthly progress reports with site photographs.
The Executing Agency shall be responsible for proper structure
specifications and workmanship. Liability for all defects in the Renovation
& furnishing work by the executing agency shall rest with them for a
period of twelve months from the date of its handing over to the
Employer. Executing Agency shall be responsible for satisfactory
rectification of defects.
Any defects discovered and brought to the notice of the Executing Agency
during the period aforesaid shall be rectified by Executing Agency
forthwith at its own cost and expenses. In the event of the failure on the
part of the Executing Agency to rectify the defects, the same may without
prejudice to any other rights available to it in law, be rectified by the
Employer for and on behalf of Executing Agency and at the cost and
expense of the Executing Agency, after due notice to the Executing
Agency.
The Employer shall have the right to deduct or set off the expenses
incurred by it in rectifying the defects as aforesaid from or against any
amount due and payable or becoming due and payable by the Employer
to the Executing Agency under this agreement or any other whatsoever.
The Employer shall be entitled to claim the balance due and recover the
same from the Executing Agency, if the amount claimed is not paid on
demand.
The Executing Agency shall unless otherwise specified be fully responsible
for procurement of all materials and services for the Renovation &
Furnishing activity.

The Executing Agency shall be fully responsible to defend any suits or
arbitration cases arising out of a project in connection with the work
between the Executing Agency and its Contractor(s). All such disputes or
differences shall be settled as per the provisions of Arbitration and
Reconciliation act, 1996.
RESPONSIBILITIES OF THE EMPLOYER I EXECUTING

AGENCY
4.1 The Employer shall demarcate and make available the site in phased
manner for the work at site.
4.2 The Executing Agency shall, wherever required, obtain in writing approval
of the local bodies or statutory bodies for the planning, construction as
contemplated in this agreement. However, the Employer shall help the
Executing Agency to the extent of writing letters to local bodies regarding
getting such approvals.
5.0 COMPLETION OF THE PROJECT
5.1 The date of start of the work shall be reckoned from the 15th day after the
signing of agreement.
5.2 The work shall be completed in all respect within a period of 24 months
decided upon from the date specified in clause 5.1 above.

5.2.1 The period of 24 months mentioned at clause no. 5.2 include 6 months for
planning and 18 months for execution and completion.
5.3 Executing Agency shall be required to complete the Renovation &
Furnishing work within the period stipulated in para 5.2 above. In case of
delay, which may occur due to the reasons beyond the control of
Executing Agency, Executing Agency would approach the Employer with
full details for extension in time limit for completion of the works. In case
of delay due to sole default on part of Executing Agency, or its contractors
/ sub-contractors the Executing Agency shall be liable to pay to the
Employer compensation (not amounting to penalty) at the rate of not
exceeding V4 % (One quarter percent) of the total anticipated Execution
Agency charges per week of delay subject to maximum of 10% (Ten percent) of the
total agency charges or such smaller amount as may be fixed by the Employer.
5.4 Any compensation levied by the Executing Agency due to non-fulfillment of
any clause of the contract by the contractor or any such recovery from the
contractor for bad work or any other reasons whatsoever shall be passed
on to the Employer.
5.5 The cost of any arbitration award or the cost as a result of any direction of
any court in respect of the work done or to be done shall be borne and
paid by the respective parties as per the order of the Arbitrator/Court.
5.6 The Executing Agency shall be fully responsible for observance of all labour
and other laws applicable in the matter and shall indemnify and keep
indemnified the Employer against effect of non-observance of any such laws.
5.7 The Executing Agency shall send completion report with as- built drawings
and maintenance schedules for all the services to the office of the
Employer in writing within 15 days of completion of work.
Responsibility to obtain Completion Certificate and Occupancy Certificate
rests with the executing agency, if required, and the project shall deemed
to have been completed and at the stage of handing over only when these
are obtained from the local body.
5.8 Executing agency shall be responsible for providing temporary
infrastructure in the buffer space for shifting of officials working in the
space in the buffer space and re shifting them to furnished space till
completion of the work as a whole.

5.9 Punjab National Bank (Employer) will not be liable directly to the
contractors/ suppliers of the items required for execution of contract.
Further, Punjab National Bank shall not liable in any manner whatsoever,
for damages/compensation under Workmen Compensation Act or any
other law or in torts or in civil law. This condition shall be agreed to in the
Contract executed between the Executing Agency and Contractor.
5.10 The service tax including any other cess as applicable on the execution
agency charges shall be paid/reimbursed to the execution agency by
Employer in addition to the agency charges.
6.0 ASSIGNMENT OF THE AGREEMENT

The Executing Agency shall not assign or transfer or part with any of the rights,
duties of obligations, wholly or in part, under this agreement without the previous
consent in writing of the Employer.
PAYMENT SCHEDULE
a) The Employer shall give 10% (Ten percent only) interest free advance on approved
budget estimate. This advance however would be retained for adjustment against the
last bill of the estimated expenditure.
b) Employer will give further advance of 10% (Ten percent only) of the estimated cost
at the time of award of work to the contractor. Employer will recover this advance
from the Executing Agency @ 15% from each running bill after 2nd running account
bill of the Contractor till the reserve deposit with the Executive Agency equals to the
proportionate expenditure required for the 2 continuous months
c) The Executing Agency shall give the reimbursement bill Bi-Monthly along
with their expenditure claim (including agency charges), copy of the expenditure duly
certified by a representative of Executing Agency on the project, for reimbursement of
expenditure incurred from the funds advanced to the Executing Agency. On
completion of work, the accounts of the work shall be closed and a final statement

shall be submitted for settlement along with refund of excess deposit received, if any,
audited
5.0 COMPLETION OF THE PROJECT
5.1 The date of start of the work i.e. planning and thereafter execution and completion
shall be reckoned from the 15th day after the signing of the agreement.
5.2 The work shall be completed in all respect within a period of 21 months
calculated from the date specified in clause 5.1 above.
5.3 The period of 21 months mentioned at clause no. 5.2 will include 6 months for
planning and 15 months for execution and completion of construction work
including Interiors.
5.4 Executing Agency shall be required to complete the Construction work including
Interiors within the period stipulated in Para 5.2 above. In case of delay, which
may occur due to the reasons beyond the control of Executing Agency,
Executing Agency would approach the Employer with full details for extension in
time limit for completion of the works. In case of delay due to sole default on part
of Executing Agency, or its contractors / sub-contractors the Executing Agency
shall be liable to pay to the Employer compensation (not amounting to penalty) at
the rate of not exceeding 1/4 % (One quarter percent) of the total anticipated
Executing Agency charges per week of delay subject to maximum of 10%
(Ten percent) of the total agency charges and shall be liable for the escalation
in project cost on account of such delay caused by Executing Agency.
Punjab National Bank
The name you can BANK upon!
Type Public
Traded as BSE: 532461

NSE: PNB
CNX Nifty Constituent
Industry Banking, Financial services

Founded 19 May 1895[1][2]
Founder Lala Lajpat Rai
Headquarters New Delhi
Key people Usha Ananthasubramanian (MD & CEO)
Products Credit cards, consumer banking, corporate banking, finance and insurance, investment
banking, mortgage loans, private banking,private equity, wealth management
Revenue 47400 crore (US$7.2 billion)(2013)[3][4]
Net income 4748 crore (US$720 million) (2013)[3][4]
Total assets 478877 crore (US$72 billion) (2013)[3][4]
Owner Government of India
Number of 62,392 (March 2013)[3]

employees
Website www.pnbindia.in
Timeline
In 1900, PNB established its first branch outside Lahore in Rawalpindi. Branches
in Karachi and Peshawar followed.
The next major event occurred in 1940 when PNB absorbed Bhagwan (or Bhugwan)
Dass Bank, which had its head office in Dehra Dun.
At the Partition of India and the commencement of Pakistani independence, PNB lost
its premises in Lahore, but continued to operate in Pakistan. Partition forced PNB to
close 92 offices in West Pakistan, one-third of its total number of branches, and which
held 40% of the total deposits. PNB still maintained a few caretaker branches. On 31
March 1947, even before Partition, PNB had decided to leave Lahore and transfer its
registered office to India; it received permission from the Lahore High Court on 20

June 1947, at which time it established a new head office at Under Hill Road, Civil
Lines in New Delhi. Lala Yodh Raj was the Chairman of the Bank.
In 1951, PNB acquired the 39 branches of Bharat Bank (est. 1942). Bharat Bank
became Bharat Nidhi Ltd.
In 1960, PNB again shifted its head office, this time from Calcutta to Delhi.
In 1961, PNB acquired Universal Bank of India, which Ramakrishna Jain had
established in 1938 in Dalmianagar, Bihar. PNP also amalgamated Indo Commercial
Bank (est. 1932 by S. N. N. Sankaralinga Iyer) in a rescue.
In 1963, The Burmese revolutionary government nationalized PNB's branch in

Rangoon (Yangon). This became People's Bank No. 7.[7]
After the Indo-Pak war, in September 1965 the government of Pakistan seized all the
offices in Pakistan of Indian banks. PNB also had one or more branches in East
Pakistan(Bangladesh).
The Government of India (GOI) nationalized PNB and 13 other major commercial
banks, on 19 July 1969.
In 1976 or 1978, PNB opened a branch in London. some ten years later, in 1986,
the Reserve Bank of India required PNB to transfer its London branch to State Bank
of Indiaafter the branch was involved in a fraud scandal.
That same year, 1986, PNB acquired Hindustan Commercial Bank (est. 1943) in a
rescue. The acquisition added Hindustan's 142 branches to PNB's network.
In 1993, PNB acquired New Bank of India, which the GOI had nationalized in 1980.
In 1998 PNB set up a representative office in Almaty, Kazakhstan.
In 2003 PNB took over Nedungadi Bank, the oldest private sector bank in Kerala. At
the time of the merger with PNB, Nedungadi Bank's shares had zero value, with the
result that its shareholders received no payment for their shares. PNB also opened a
representative office in London.
In 2004, PNB established a branch in Kabul, Afghanistan, a representative office in

Shanghai, and another in Dubai. PNB also established an alliance with Everest
Bank in Nepal that permits migrants to transfer funds easily between India and
Everest Bank's 12 branches in Nepal. Currently, PNB owns 20% of Everest Bank.

Two years later, PNB established PNBIL Punjab National Bank (International) in
the UK, with two offices, one in London, and one in Southall. Since then it has
opened more branches, this time in Leicester, Birmingham, Ilford, Wembley, and
Wolverhampton. PNB also opened a branch in Hong Kong.
In January 2009, PNB established a representative office in Oslo, Norway. PNB hopes
to upgrade this to a branch in due course.
In January 2010, PNB established a subsidiary in Bhutan. PNB owns 51% of Druk
PNB Bank, which has branches in Thimpu, Phuentsholing, and Wangdue. Local
investors own the remaining shares. Then on 1 May, PNB opened its branch in
Dubai's financial center. PNB purchased a small minority stake in Kazakhstan-based
JSC Dena Bank. Within the year PNB increased its ownership and now PNB owns
84% of what has become JSC (SB) PNB. The subsidiary has branches
in Almaty, Astana, Karaganda, and Pavlodar. Dena Bank was established on 20
October 1992 in Pavlodar.
September 2011: PNB opened a representative office in Sydney, Australia.
December 2012: PNB signed an agreement with US based life Insurance

company Metlife to acquire a 30% stake in MetLife's Indian affiliate MetLife
India Limited. The company would be renamed PNB MetLife India Limited and
PNB would sell MetLife's products in its branches.[8]
Financial performance[edit]
FY 2008- FY 2009- FY 2010- FY 2011- FY 2012-

# Particulars[3]
09 10 11 12 13
A Deposits (' INR crores) 209,761 249,330 312,899 379,588 391,560
B Advances (' INR crores) 154,703 186,601 242,107 293,775 308,725
Total Business (A+B) ('

C 364,464 435,931 555,006 673,363 700,285
INR crores)

Total Assets (' INR
D 246,919 296,633 378,325 458,192 478,877
crores)
Operating Profit (' INR

E 5,690 7,326 9,056 10,614 10,907
crores)
F Net Profit 3,091 3,905 4,433 4,884 4,748
G Business/Employee 655 808 1,018 1,132 1,165
Profit/Employee (' INR

H 5.64 7.31 8.35 8.42 8.06
lakhs)
I Return on assets (%) 1.39 1.44 1.34 1.19 1.00
J Gross NPAs (%) 1.60 1.71 1.79 2.93 4.27
K Net NPAs (%) 0.17 0.53 0.85 1.52 2.35
L Total Branches 4,665 4,997 5,189 5,670 5,874
Listings and shareholding
PNB's equity shares are listed on Bombay Stock Exchange and the National Stock
Exchange of India.[9][10] It is a constituent of the CNX Nifty at the NSE.[11]
Shareholders (as on 31-Dec-2013) Shareholding[12]
Promoter Group (Govt. of India) 58.87%
Foreign Institutional Investors (FII) 17.51%

Insurance Companies 15.46%
Individual shareholders 04.05%
Banks/Financial Institutions/Mutual Funds/UTI 03.02%
Others 01.09%
Total 100.0%
PNB office in Lucknow
Employees
As on 31 March 2013, the bank had 63,292 employees, out of which 11,594 were
women (18%). It also had 919 employees withdisabilities on the same date (1.45%).
[3]
The average age of bank employees on the same date was 46 years.[3] The bank
reported business of INR 11.65 crores per employee and net profit of INR 8.06 lakhs

per employee during the FY 2012-13.[3] The company incurred INR 5,751 crores
towards employee benefit expenses during the same financial year.[3]
Awards and recognitions
Punjab National Bank was ranked #717 in the Forbes Global 2000 in May
2013.[13]
Punjab National Bank was ranked #26 in the Fortune India 500 ranking of
2011.[14]
PNB was awarded the 'Best Public Sector Bank' by CNBC TV18 in 2012.[15]
The bank was recognised as the 'most socially responsive bank'

by Businessworld and PwC in 2012.[16][17]
In 2011, it received Golden Peacock Award for "Excellence in Corporate

Social Responsibility"[18] and "National Training Award".[19]
Initiatives
The bank incurred INR 3.24 crores on CSR activities like medical camps, farmer
trainings, tree plantations, blood donation camps etc. during the FY 2012-13.[3]
See also
Banking in India

List of banks in India
List of companies of India
External links[edit]
Official website
News articles on PNB at Times of India
PNB at Bombay Stock Exchange
Categories:
CNX Nifty
Companies based in New Delhi
Banks of India
Banks established in 1894
Government-owned banks of India
Companies nationalised by the Government of India
Government-owned companies of India
ratio (CAR), well above the Basel2 regulatory requirement, at 12.96% as on June
2008, despite being exposed to numerous market and credit risk elements.
Constantly strengthening the capital adequacy ratio through internal accruals and a
regular increase in Tier 1 capital has put the bank on a very comfortable and
formidable position. Punjab National Bank has a net interest margin (NIM) higher
than the industry average due to a mix of improving yields and low cost funding base

and has one of the healthiest low cost current account saving account (CASA) ratio of
41.31%. It also enjoys the highest rating by all four domestic rating agencies and one
of the few banks to boast a AAA rating on its perpetual debt issue.
The bank has ambitious plans of major technological upgradation to establish
capability of having 100,000 terminals under the Core Banking Solutions (CBS) with
a greater thrust on increasing international footprints.The bank has successfully
migrated to the Basel 2 accord in February this year.
In a macroprudential analysis of the Indian economy, it seems as the Indian banking
industry has come a long way and entered in its ever challenging growth phase in a
very prominent time as more than 49% of population financially excluded offers
immense opportunity to the bank.
The core focus of the bank will be on retaining and further improving low cost
deposits, lending to agriculture and small and medium enterprises and repositioning of
subsidiaries and joint ventures.
At the time of global financial turmoil, where the banks all over the world are
creeping under tremendous pressure, Punjab National Bank has managed to insulate
itself away from fatal transactions and has strictly adhered to the RBI guidelines.
In July 2011, Punjab National Bank agreed to pick up a 30% stake in MetLife India
which will make it the single largest shareholder in the private insurance company.
The two parties have agreed that once the deal is finalized the company will be
renamed PNB MetLife India.
Awards:
National Award for Excellence in SSI Lending Ranked 2nd for four consecutive
years from 2002 to 2005
The Banker's Almanac Ranked 3rd amongst banking sector in India and 323rd rank
in the world in 2006
The Banker, London Ranked 386 amongst Top 1000 Global Banks in July 2005
AC Nielson Survey 9th amongst Top 50 Most Trusted Services Brands in India
Golden Peacock Award for excellence in corporate governance in 2005
2010
Best Corporate Social Responsibility Practice Award
SCOPE Meritorious Award for Excellence in Corporate Governance 2009.
Golden Peacock Award for Excellence in Corporate Governance for 2009

India Pride Awards for Excellence in PSU Category
Award for Priority Sector Lending including Financial Inclusion
5 National Awards for the contribution made in promoting MSMEs
Skoch Challenge Award 2010 for livelihood linkage of the Milk producers in
Bulandshahar District Uttar
Pradesh
Golden Peacock Innovative Product and Services Award for BCP Implementation for
the year 2010
Best Info Sphere Warehouse Solution Award 2009 IBM
IDC Financial Insights Innovation Awards 2010
CIO 100 Awards for the Year 2009
Emerson Uptime Champion Awards for 2009 in the Government and PSU Category
Excellence in Training Award in 200910
2011
SCOPE Meritorious Award for Best Managed Bank

Wind Power India Awards Second Prize under the category of ?Best Wind Power
Project Financier ? 2011
Golden Peacock Award for Excellence in Corporate Social Responsibility
Golden Peacock National Training Award 2010 6th BML Munjal Award for
Excellence in Learning & Knowledge Development ? 2010
Rolta Corporate Award 2010 Top Indian Company under ?Banks? Category
Best Corporate Social Responsibility Practice Award 2011
Award for ?Computerization of RRBs ? for 2010
Award for ? Best Home Loan Provider? for 2010
Award for ?Best Education Loan Provider? 2010
Global HR Excellence Award 2010 for the outstanding Contribution to the cause of

Education
Asia's Best Employer Brand Award
Award for Brand Excellence under Banking & Financial Services
CSR Excellence Award
2010
2012
Best Bank Award 2011
Most Socially Responsive Bank 2011
Overall Most Productive Bank Award 2011
Golden Peacock National Training Award
Best in Corporate Social Responsibility overall
Skoch Financial Inclusion Award for its Jana Mitra Rickshaw Scheme
India pride Awards in Corporate Social Responsibility (CSR)
Editorial Board Roll of Honour by CNBC TV18 India Best Banks and Financial
Institutions Awards
Global HR Excellence Award under the category ''Organisation with Innovative HR
Practices''
Two Awards for SME financing
For lending under Prime Minister's Employment Generation Programme
(PMEGP)Scheme in North Zone and for Lending in Khadi and Village Industry
Commission ( KVIC) Interest Subsidy Scheme on All India level.
Best Bank Awards among Large Banks for ''IT for Internal Effectiveness''
Golden Peacock Award for HR Excellence 2011
Award for Excellence in Training
2013
Golden Peacock Business Excellence Awards for the year 201112
Social and Corporate Governance Award Best Corporate Social Responsibility
Most Socially Responsive Bank 2012
Best Public Sector Bank
Best Bank and Financial Institutions Awards
Organisation with Innovative HR Practices
Best online Bank ( 1st Runner Up) Indian Banks' Association
Bank with Best Use of Business Intelligence (W inner)

Bank with Best Risk Management and Security Initiatives(winner)
Bank with Best Financial Inclusion Initiatives (Second Runner Up)
Best Bankers' Award under Agriculture CreditLarge
Best Public Sector bank under Priority Sector Lending
3rd CMO Asia Excellence for Branding & Marketing under Banking, Financial
Institutions and Insurance
3rd Asia's Best Employer Brand Awards Excellence in Training '
Subsidiaries of Punjab National Bank
PNB Gilts
PNB Housing Finance
PNB Investment Services
PNB Insurance Broking
PNB Life Insurance Co.
Joint Ventures of Punjab National Bank
Principal PNB Asset Management Company
Principal Trustee Company
Assets Care Enterprises
India Factoring & Finance Solutions
Objective of the Project

The objective of this project is to study in depth the credit appraisal procedure
followed by PUNJAB NATIONAL BANK, which includes
Understanding the different types of credit facilities and credit delivery

mechanisms provided to industrial customers viz. Overdraft, Cash Credit,
Drawing Rights, Fund Based Credit, Non Fund Based Credit etc.
Understanding the different methods available for risk vetting of lending
proposals, different risk assessment models and the different credit rating
procedures used in Punjab National Bank.
Understanding the appraisal process of Term Loan and working Capital
financing and sanctioning of working capital, issuing term loan, to corporate,
through different case studies, on the job training.
Assessing the qualitative factors which influence the decision making of
lending to a particular client apart from theoretical parameters.
Chapter 5
RISK
The credit risk rating model has been developed with a view to provide a standard
system for assigning a credit risk rating to the borrowers of the bank according to
their risk profile. This model is applicable to all large corporate borrowal accounts
availing total limits (fund based and non-fund based) of more than Rs. 15 crore or
having total sales of more than Rs. 100 crore.
Inputsto the model are the financial data of the borrower, industry information and the
evaluation of the borrower on various objective and subjective parameters.

The model evaluates the credit risk rating of a borrower on a scale of AAA to D with
AAA indicating minimum risk and D indicating maximum risk. The credit risk-rating
model incorporates and includes possible factors of risk for determining the credit
rating of the borrower. These risks could be internal and specific to the company, the
industry in which the company is operating or the entire economy and can influence
the repayment capacity and / or willingness of the company.
T A
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Figure 1: Types of Risks
Important factors considered in the rating process of the clients
The rating model contains several qualitative parameters that are to be evaluated
subjectively. It is, therefore, necessary to be adequately familiar with the company
and the industry. Visiting the company and interacting with its management generally
helps the rater in understanding the underlying activity behind the financial data of
the company being analysed; the business prospect of the company and its
management. Information should be collected about the company from all possible
sources to conduct this exercise completely, accurately and in an authenticated
manner.
The data used to rate companies should be annualised & made comparable before it is
used for rating purposes. Similarly the financials of the company should be made
comparable with peers in case of change in accounting policies, merger, demerger,
acquisition, sell-off etc.

While evaluating a company against the industry the following points should be
kept in mind:
The companys value should be compared only with peers.

Size / capacity / volume are indicative factors in selecting peers.
The sample of companies chosen for the industry comparison should be
identical as far as possible for rating all companies under one particular
industry having similar size / capacity / nature of activity.
The number of companies in sample should be reasonable i.e. neither too low
nor too high.
The sample size should be of at least 5 companies. The sample should
preferably be selected from the activities in which company is operating.
Special considerations in case of unavailability of data for clients
For companies where industry data is not available, data for other comparable
industries can be used. For example, blade-manufacturing companies can be
compared with combined sample of companies manufacturing blade and other
shaving products etc. Similarly Hindustan Aeronautics Ltd. may be compared with
other heavy engineering companies, which also uses intensive technologies and have
a similar size, say in terms of sales turnover.
For multi-divisional companies, which are involved in more than one industry,
evaluation should be done separately for each business. Thus the management
evaluation, conduct of account and financial evaluation will be done on a common
basis. For the business section, each business should be evaluated and scored
separately, taking into account the different industries involved. A weighted average
of these business scores should be calculated, where the weights are proportional to

the contribution of each business to the companys total sales. This weighted average
should then be combined with the scores in the other sections to arrive at the overall
rating for the company.
The credit risk rating exercise should be done immediately after receipt of audited
financial results of the company and should be delinked invariably from the regular
renewal exercise. The updating of the credit ratings should be undertaken normally at
quarterly intervals or at least at half-yearly intervals, operationalising of Preventive
Monitoring System (PMS) will be an aid in this regard.
In case latest data of peers is not available for industry comparison, then last available
data, not more than one year old, may be considered.
For companies, which have not been banking with PNB earlier, the score obtained
excluding conduct of account should be scaled up to 100 and the rating assigned
accordingly, as the PMS score will not be available.
The Credit Policy and Risk Management Department (CPRMD), Head Office will
provide the industry score to be used for all major industries, progressively. Until such
time the industry score may be assigned as 50%.
Parameters considered in the PNBs Credit Risk Model
Parameter 1: Financial Strength Of The Clients

The financials of a company are indicative of the health of the company and potential
risks in lending to the company e.g. if the company already has a large amount of debt
on its balance sheet, compared to its cash flow generation capacity, a loan to this
company would be risky.
Parameter 2: Business Performance Of The Clients

The business performance of a company has a direct relationship with the credit risk
of the company as the business performance determines the generation of cash for
debt repayment. The companys competence in its activities as well as its position
relative to its competitors are key indicators of how a company is expected to perform
and its ability to generate funds to repay its debts.

Parameter 3: Industry Outlook Of The Clients
The credit rating of a company cannot be assessed without considering the outlook of
the industry in which the company is operating. Industry performance very often has a
direct bearing on the performance of a company. Two companies in different
industries would have different credit worthiness depending on the outlook for their
industries
Parameter 4: Management Evaluation Of The Clients

The quality of management and management structure are very important indicators
of a companys credit risk. The performance of a company driven by a strong
management is likely to be better than that of a company having a poor management
irrespective of the industry to which it belongs.
Evaluation of management is important not only due to its impact on the companys
performance, which determines its capability to repay, but also from the point of view
of its integrity. This is because the intentions of the management determine the
willingness of the company to repay its debts.
The management quality thus influences both aspects of default risk, the ability as
well as the willingness of the borrower to repay its debts. Thus the evaluation of
management quality is an essential input for credit risk assessment.
Parameter 5: Conduct Of Account

The conduct of account refers to as to how the borrowers existing accounts with our
Bank as also with other banks are being conducted and whether any problems are
being faced. The conduct of account provides useful indications about the ability and
willingness of the borrower to meet his obligations. The manner in which a borrower
has been conducting his accounts in the past is a good indicator of how the account is
likely to behave in future as well.
Assessment of the Parameters of the Model
Assessment of financial strength
The financial strength of a company may be assessed by critically analysing the past
financial performance, its trend and expected future performance. This analysis help

in predicting the potential risk involved. These parameters are taken normally from
the annual financial statements of the company i.e. Balance Sheet, Profit & Loss
Statement and the Cash Flow statement. Past performance is taken as a guide to
realistically assess future performance.
Besides, it is essential to determine the quality of these financial statements as to what
extent these can be accepted at face value. Further, the trends in financial
performance over the past few years also indicate how the companys performance
has been changing over the past few years.
The financials are evaluated under four broad areas as under:
1. Past financial performance

While credit risk rating is done to evaluate the ability of a company to repay its debts
in future, evaluation of past financials is very important as it reflects the present
financial health of a company, which is a good indicator of how a company is
expected to perform in future.
The past performance is evaluated on the basis of figures given in the financial
statements of the company as well as industry data. Some of the parameters are
evaluated against absolute benchmarks while some are judged in comparison to peers.
In respect of certain parameters percentage growth of the company over the past few
years are compared while in respect of certain parameters, the ratios derived from the
previous years financial reports are compared. The evaluation of each of the
individual parameters is explained in detail in the following pages.
2. Future risk expectations
The expectation of future financial risk is an important input to the credit rating
process. This is used to evaluate the cash flows of a company as well as any major
risks, which the company might be facing in future that may adversely impact its
financial performance.
The evaluation of future risk expectations is a subjective matter based on the
assessment of the companys future performance. These expectations are based on the
performance of the company in the past as well as its plans for the future. The
contingent liabilities of the company, the Foreign Transaction Risk and the cash flow
adequacy etc. are considered in this section.
3. Subjective assessment of quality of financial figures

The assessment of the financial figures of a company is very essential to determine
the extent of reliability of the figures given in the financial statements of a company.
Companies often resort to tactics meant to distort the figures in the financial
statements such as adjustments in depreciation method, income recognition,
capitalisation of interest/expenses, pricing of inventory etc. Hence there is a need to
assess the extent to which the figures given in the balance sheet are reliable and how
transparent the accounts of the company are.
Further, the actual realisable value for these assets may also be different from that
given in the balance sheet. These aspects are to be taken into consideration while
evaluating the financials of a company.
4. Trends in financial performance over the past few years

The assessment of past financials relies on figures for the previous year. The pattern
of change over the previous years is an important indicator of the companys future
performance. The evaluation of trends in respect of certain identified parameters is
done using the figures given in the financial statements of the company. The
evaluation of these parameters takes into account the direction & magnitude of
changes over the past years.
Within these areas, parameters are defined to determine the companys position on
each of these areas. Scores are assigned to the parameters within these areas and they
are combined to arrive at a score for each of the above areas. The scores for these
areas are then combined according to the weights assigned to different areas to arrive
at the cumulative financial score.
The subjective assessment of financials as well as trends in financial performance is
used to adjust the score obtained under past financials.
Past financial performance
The assessment of past financial performance is done on the following parameters and
each of them is assigned a different weightage in order to arrive at a cumulative rating
for the past performance.
Gross Sales Growth Rate Debt-Equity ratio
OPBDIT Total Net Worth
Short Term Borrowings Current Ratio
Operating Cash flow Interest Coverage Ratio
Net Cash Flow DSCR

Assessment of business performance
The performance of a company is influenced both by its own set up as well as its
competitive position within the industry. Thus the two broad sub-areas used to assess
the business performance of a company are:
1. Operating Efficiency
2. Market Position
Within these areas parameters are defined separately for manufacturing and service
sectors. The parameters defined for Service Sector and detailed guidance for
evaluating these parameters are given under Section 4.5. Scores are assigned to the
parameters within these areas and they are combined to arrive at a score for each of
the above areas. The scores for these areas are then aggregated according to the
weights assigned to different areas to arrive at the cumulative score for the company
on business performance.
1. Operating Efficiency of the Client

This covers the operations of a company and how efficient it is at performing its core
activities and takes care of aspects like the asset utilisation of the company, its
working capital management, cost effectiveness of operations etc. These factors play
an important role in determining the business performance of a company and thus are
evaluated for determining the business performance.
The evaluation of the parameters under this area is done on an objective basis using
the figures in the financial statements of the company. Within these, some parameters
might require a subjective assessment and have to interpret from the financial
statements. This would be applicable specifically to parameters like Credit Period
Availed and Credit Period Allowed. e.g. if credit period availed is very high as
obtained from the financial statements, then it could be due to a very good reputation
of company in the market, or because the company is not paying its suppliers in time.
Thus an interpretation of these figures will have to be made to decide what score is to
be assigned.
There are various parameters on which the evaluation is done but the most important
parameters out of these will be selected and scores assigned to them. The selection of

these parameters may be made on the basis of its relevance in a particular industry &
these will be decided by the Credit Systems and Tools Team and updated from time to
time as needed.
2. Market Position of the Client
The business performance of a company is not governed simply by its own operations
but also by the competition in the industry as well as the companys position vis--vis
its competitors. This also covers risks related to buyers, suppliers and technology used
by the company. An evaluation of the parameters helps in determining how well the
company is placed to compete in the market and how efficient its operations are. It
also reflects how fluctuations in the market and developments in the industry would
influence the operations of the company.
The parameters that would be used for evaluating the market position of a company
would vary from industry to industry. Also, within these parameters, assignment of
scores would require a large number of sub-parameters to be considered. The Credit
Systems & Tools Team in association with the industry specialist teams would decide
these parameters and sub-parameters for different industries.
The rater assigns scores to the individual sub-parameters, which would then lead to a
final score for the parameters, after combination of weightage assigned to the
individual sub-parameter. Assignment of scores to the parameters/sub-parameters will
be subjective.
Assessment of Industry Outlook of the Client

The industry rating is used to adjust the score obtained by a company on business
performance. The rationale for this is that a company belonging to an industry that
score highly on industry rating would be in a better position to strengthen its business
position. Conversely a company belonging to an industry with a poor industry
outlook would have adverse impact on its business position.
Good performers are given greater benefit and penalised less for the industry outlook
because they would be in a better position to exploit the opportunities in the industry
as well as protect against the uncertainties in the industry.
The Credit Policy and Risk Management Department (CPRMD) provide the industry
score to be used for all major industries, progressively. Until such time the industry
score may be assigned as 50%.

Assessment of Management Quality of the Client
Evaluation of management is done to determine both their competence as well as their
integrity.
The two sub-areas considered for this purpose are:
Achievement of past targets by the company
Subjective assessment of management quality
Within these two sub-areas, parameters are defined which enable us to determine the
companys position on each of these sub-areas. Scores are assigned to the parameters
within these areas and they are combined to arrive at a score for each of the above
areas. The scores for these areas are then aggregated in accordance with the weights
assigned to different areas to arrive at the cumulative score for the company on
management quality.
1. Achievement of targets by the Client

The targets quoted by the company at the beginning of the year are used as the
benchmark with which the actual performance is compared. This gives an indication
of the managements ability to drive the company by properly gearing it to the
performance target set by them.
The actual results of the company are compared to the targets that had been set by the
company at the beginning of the year and the extent to which the targets have been
achieved is used to assign scores to the parameters.
Achievement of actual sales against estimated/projected sales Score
< 75% 0
75% to 79% 1
80% to 89% 2
90% to 95% 3

> 95% 4
Table 2: Achievement of Sales Targets by the Management
2. Subjective assessment of the management of the client

The assessment of management on criteria like integrity, honesty, and track record is
assessed in this section. This area is important as this indicates both the quality as well
as integrity of management. Hence it is essential to be completely familiar with the
management of the company and its track record, organisation structure and reporting
relationships within the organisation as well as the qualifications of the top
management personnel.
Assement of Conduct of Account of the Client
The evaluation of the conduct of an account is done on the basis of its PMS Rank or
PMS Index Score (Maximum). The outlook and performance of an industry depend
on a number of parameters that include the structure of the industry as well as its
financials. Some of the broad parameters that are used for evaluating an industry are:
1 Expected industry growth rate
2 Capital market perception: The industry P/E ratio is a useful indicator
in this regard
3 Regulatory framework
Tax Concessions
Tariff Protection
4 Demand-supply mismatch
5 Financial performance of industry
Return on capital employed

Price stability
Operating profit margins
Earning stability
6 Threat from globalisation
7 Structural attractiveness
Supplier power
Buyer power
Threat of product substitution
Threat of new entrants and entry barriers
Competition within the industry
Comparison Of The Model With The Industry Standard
The current Credit Risk Model of PNB can be compared to the Industry standard that
has been arrived at by the secondary research done through research papers. The
model used by PNB is evaluated on the basis of each of those parameters that are
considered important for a banks credit rating system as follows:
Disciplined way of looking at Credit Risk and estimation of the overall

health status of an account: The model has predefined sub parameters in
different sub areas that help the bank to evaluate a project on various different
areas that can affect the Credit Risk to the bank. The financial, management,
operation, industrial and historical data is all taken into consideration while
evaluating an account.
Assessment of impact of a new loan asset on the portfolio: The bank
follows strict guidelines that limit the funding of the projects. These limits are
prescribed as a percentage of the total funding available to the bank. This

helps the bank to limit the risk involved in its operations. This characteristic of
the model helps the bank to cover for the losses in case of defaults.
Sector wise Risk monitoring: The bank has operational poilicies in the credit
risk model that helps the bank to monitor its activites in a particular sector.
This helps the bank to limit the risk involved in case of changing traditions
and policies of the entire industry that might have an adverse effect.
Relationship managers for high value accounts: Bank does not have a
policy of appointing relationship managers for high value account. However,
bank has included a structure of approval of the projects such that the projects
are looked into by the different offices in terms of power and hierarchy. High
Value projects are generally handled by Regional or Zonal Offices while
smaller projects can be handled at the District Headquarter level or Branch
Office level.
Rating procedures should be implemented:PNB has a rating system of the
clients set up in place that considers a number of parameters and sub-
parameters to calculate the worthiness and risk quotient of the client. These
parameters are based on financial, environmental, internal, operational and
historical performance of the firms.
Case Study
Tulip telecoms connectivity presence across 1415 cities,enable
HDFC banks aggressive expansion plan even in remotest of area .
HDFC Bank was incorporated in august 1994 & has its registration
office in Mumbai HDFC bank commenced operations as a scheduled
commercials bank in January 1995 it currently has a nationwide of
1506 branches and 3573 ATMs in 635 indian towns and cities for
the half year ended September 30, 2009 the bank earned a total
income of Rs 10136 corer
HDFC Bank has been expanding its branches aggressively in metros

smaller cities and remote areas the bank was facing challenges in
terms of connectivity in many of these remote areas. Since they had
to ramp up their branches in a short time the development has to

be rapid as well.therefore the bank has been looking for the service
provider who could help them connect 500 of their branches spread
across the country
In several locations, tulip telecom had the edge over other in terms
of feasibility and delivery, says ajit tiwari ,deputy vice president,
HDFC Bank
HDFC Banks deployed tulips MPLS VPN solution in cities including A

& B class cities on fiber and wireless on the last mile in the remote
area.now HDFC bank avails tulips metro Ethernet networks for
their high bandwidth requirement on fiber for connecting there B &
C class location also.along with this tulip has provided high
bandwidth o fiber for the banks offices and branches located in the
metros. 20 Mbps fiber link has been provisioned connecting the
banks heads office to their data centre location in Mumbai two
backhaul links each of 60 Mbps have been deployed on fiber, one in
Bangalore and the other in Mumbai tulips has also provisioned an 8
Mbps link on fiber connecting their branches office in Vijayawada
over MPLS. The engagement with tulips telecom started over four
year ago, since them HDFC has been banking on tulip telecom to
manage their connectivity link

Tulip has always maintained good a turnaround time in
term of circuit delivery, says tiwari HDFC bank also signed
an SLA with tulip for the maintenance of the circuit
Conclusion
The financial status of the clients is a very important factor in determining the
funding limits and loans to the firms.
For new projects, viability of the projects is an essential factor in determining
whether the project should be funded or not.
For large corporate accounts, PMS rating and account history is the most
crucial factors along with the project viability.
The subjectivity in evalutating the parameters for a project provide the bank
with a provision to incorporate the reports made by Lending Engineers for the
projects.
The model also has a provision for including the reviews of external rating
agencies (CRISIL, ICRA etc.) in case of need of external verificaton.

Recommendations
Based on the analysis and the results arrived from the research, various
recommendation that can be made to enhance the existing model for PNB are:
Financial and operational performance of the company applying for loan

should be compared with its industry peers. Relative performance comparisons
will not only highlight the management capability but also help in identifying
any abnormalities in the information submitted by the company.
Compliance with Basel-III norms has to be met by 2018, as prescribed by the
RBI. The bank must be pro-active in developing and designing the policies to
meet the requirements and stabilize the Tier-I and Tier-II capital ratios.
Forward looking statements with respect to sales, profitability etc. provided in
the DPR and other reports submitted by the company should be treated with
caution. Market analysis, demand analysis, sales projections etc. should be
evaluated on with prevailing norms of the RBI.
If any of the critical ratios is marginally unfavorable, then additional collaterals
could be charged or pricing of the loan could be revised upward to compensate
for the additional risk
Due to increased activism and regulatory crisis like that with spectrum allocation,
mining leases, land acquisitions issues, environmental considerations etc. viability of
otherwise sound projects is threatened. Social, political and economical risks should
also be taken into consideration while deciding project viability.

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PROJECT ON

PANJAB NATIONAL BANK

ROHIT SURESH JAIN

TYBCOM (BANKING & INSURANCE)

SEMESTER- V YEAR ( 2015 -2016)

SHREE SHANKAR NARAYAN COLLEGE

NAVGHAR ROAD, BHAYANDER (E),THANE 401105

.(AFFILIATED TO UNIVERSITY OF MUMBAI )

PUNJAB NATIONAL BANK [Type text] 1

It gives me a great pleasure to present the project on. I thank my

I would like to appreciate the efforts of library staff and my friends

PUNJAB NATIONAL BANK [Type text] 2

1 General Information about the Company

2 Structure of Indian Banking Industry

3 Business should respect, protect, and make

PUNJAB NATIONAL BANK [Type text] 3

PUNJAB NATIONAL BANK [Type text] 4

General Information about the Company

5 Agency Business- Insurance, Mutual Funds etc.

_ Savings Fund Account

_ Term Deposit Account

PUNJAB NATIONAL BANK [Type text] 5

9. Total number of locations where business activity is undertaken by the Company

b. Number of National Locations

PUNJAB NATIONAL BANK [Type text] 6

Banking is the business of providing financial services to consumers, The basic

Banking Industry at a Glance

PUNJAB NATIONAL BANK [Type text] 7

PUNJAB NATIONAL BANK [Type text] 8

PUNJAB NATIONAL BANK [Type text] 9

Sources of risks considered in the model

PUNJAB NATIONAL BANK [Type text] 10

Credit Risk Applicability

NBFC All Non Banking Financial Companies irrespective of Limit

Entrepreneur Borrower setting up Cost of project up to Rs. All sectors, except

PUNJAB NATIONAL BANK [Type text] 11

Table 1: Credit Risk Rating Entity Model

Usage of the credit risk

PUNJAB NATIONAL BANK [Type text] 12

2. The scores given to the individual parameters multiplied by allocated weights

S No. Factor Weight Assigned

3. The overall percentage score obtained from step 2 on a scale of 0 to 100 is

PUNJAB NATIONAL BANK [Type text] 13

PNB-AA Marginal Risk Above 77.50 up to 80.00 PNB- AA+

Above 72.50 up to 77.50 PNB- AA

Above 70.00 up to 72.50 PNB- AA-

PNB-A Modest Risk Above 67.50 up to 70.00 PNB- A+

Above 62.50 up to 67.50 PNB- A

Above 60.00 up to 62.50 PNB- A-

PNB-BB Average Risk Above 57.50 up to 60.00 PNB- BB+

Above 52.50 up to 57.50 PNB- BB

Above 50.00 up to 52.50 PNB- BB-

PNB-B Marginally Above 47.50 up to 50.00 PNB- B+

Financial Details of the Company

PUNJAB NATIONAL BANK [Type text] 14

1. Does the Company have any Subsidiary Company/ Companies?

a. Punjab National Bank (International) Ltd, UK.

PUNJAB NATIONAL BANK [Type text] 15

PUNJAB NATIONAL BANK [Type text] 16

PUNJAB NATIONAL BANK [Type text] 17

1. Please indicate the Total number of employees.

PUNJAB NATIONAL BANK [Type text] 18

Sn. Category No of Complaints No of Complaints

2 Sexual harassment 2 Action has been