JK Bank Shriya

PROJECT REPORT
ON
ASSESSMENT OF RETAIL LOAN IN RELATION TO
THE EXTANT SCHEMES OF THE BANK
THE JAMMU&KASHMIR BANK LTD
SUBMITTED TO:
For the degree of

Bachelor of Business Administration
(BBA)-111
Submitted by: Supervised by:

SHRIYA RAINA
BBA-1V
Roll -2
ACKNOWLEDGEMENT
Gratitude is the hardest of emotions to express and one often does not find
adequate words to convey what one feels and trying to express it
The success of any disciple depends upon the grace and able guidance of the master. Words
fail to express our thanks to almighty whose benign benedictions empowered with a zeal and
strength for completion of our task.
It is my Pleasure to place on record my sincere gratitude towards my research guide Mr.

who spent precious time for successfully completion of my project report. It was his direction
and encouragement at every movement and step tat motivated me to steer the research work
confidently and successfully. Under his moral support and guidance, this has been a source of
inspiration to me.
I acknowledge my sincere gratitude to all the banking staff especially Mr who helped
me in completion this project successfully. Under their moral support and guidance, this has
been source of inspiration to me.
I am highly thankful to my parents for their support and encouragement last but not the least
I would like to owe an external sense of gratitude to my friends who helped me, guided me
from time to time in proper execution of this project.
DECLARATION
I hereby declare that the work presented in this project titled Process followed by J&K Bank
in assessment of the retail loan in relation to the Extant scheme of the bank. submitted
towards completion of summer internship project in BBA IV SEM from INSTITUTE OF
MANAGEMENT STUDIES (JAMMU UNIVERSITY) is an authentic record of my
original work completed under the guidance of project guide, Mr. Rajesh Gupta, Asst .Vice
President. The information submitted here is true to the best of my knowledge.
SHRIYA RAINA
EXECUTIVE SUMMARY
The project assigned is Retail Loans which focuses on loans provided to a larger mass of
people or customers for consumption, investment or production purposes.
Different banks, whether public or private, are in the race of outperforming each other &
getting most of the coverage of this sector. As per the report on Trend and Progress of
Banking in India, 2011-2012, the loan values of this retail lending typically range between
Rs.20, 000 to Rs.100 lakhs. J&K bank is also trying to mark its name in providing facilities
of Retail Lending to different customers.
The objective is to understand the procedure of assessment of the retail loan in relation to
the
Extant scheme of the bank.
To ascertain the potential of the credit policy of J&K Bank and look into various industries
which have been a part of J&K Bank credit policies.
To observe the steps adopted by the bank to access the eligibility of the borrower. How the
retail loan requirements are ascertained at J&K Bank.
Contents
1. PROFILE OF BANK
History of bank
Unique characteristics
Product& services
2. LOAN OVERVIEW
3. EDUCATIONAL LOAN
Scheme
Case study
4. CAR LOAN
Scheme
Case study
5. HOME LOAN
Scheme
Case study
ANALYSIS
6. RESEACH METHOLOGY
7. SUGGESTIONS
8. FINDINGS
9. CONCLUSION
10.BIBLOGRAPHY
INTRODUCTION J&K BANK

PROFILE OF J&K BANK
Incorporated in 1938 as a limited company.

Governed by the companies ACT and banking regulation ACT of India.
Regulated by the Reserve Bank Of India and Security Exchange Board of India.
Listed on the National Stock Exchange and Bombay Stock Exchange.
53% owned by the government of J&K.
Rated P1+ by standard and POOR CRISIL connoting highest degree of safety.
1.1 HISTORY
Jammu and Kashmir Bank Limited was incorporated on 1st October, 1938 as a
limited company and commenced its business from 4th July, 1939 in Kashmir (India).
The Bank was the first in the country as a State owned bank. The Jammu & Kashmir
Bank Limited has been the first of its nature and composition as a State owned bank in
the country. The Bank was established as a semi State Bank with participation in capital
by State and the public under the control of State Government.
According to the extended Central laws to the state, Jammu & Kashmir Bank was
defined as a private Company as per the provision of Indian Companies Act 1956. In the
year 1971, the Bank received the status of scheduled bank. It was declared as "A" Class
Bank by RBI in 1976.
The bank had to face serious problems at the time of independence when out of its
total of ten branches two branches of Muzaffarabad and Mirpur fell to the other side of
the line of control (now Pak Occupied Kashmir) along with cash and other assets.
BRAND IDENTITY
The new identity of J&K Bank is a visual representation of the Banks philosophy and
business strategy.
The three colored squares represent the regions of Jammu, Kashmir and Ladakh.
Green signifies growth and renewal.
Blue conveys stability and unity.
Red represents energy and power.
The counter- form created by the interaction of the squares is a falcon with outstretched
wings A symbol of power and empowerment. The synergy between the three regions
propels the bank towards new horizons.
All these attributes are integrated and assimilated in the white counter-form.
1.2 UNIQUE CHARACTERSTICS AND SERVICES
Private sector Bank despite government holding 53 per cent of equity.
Sole banker and lender of last resort to the Government of J & K.
Plan and non -plan funds, taxes and non-tax revenues routed through the bank.
Salaries of state Government officials disbursed by the Bank.
Only private sector bank designated as agent of RBI for banking.
Carries out banking business of the Central Government.
Collects taxes pertaining to Central Board of Direct Taxes in J & K.
1.3 MISSION OF J&K BANK
To provide the people of J&K internationally Quality financial services and

solutions.
To be a super specialist bank in the rest of the country.
To empower the people of J&K.
These together will make J&K Bank the most profitable bank in the Country.
1.4 PRODUCTS AND SERVICES
Support Services
Anywhere Banking.
Internet Banking
SMS Banking
ATM Services
Debit Cards
Credit Cards
Merchant Acquiring
Depositary Services
Demat Account
Other Services
Third Party Services
Mutual Funds
Insurance Services Life and Non Life
Remittace Services
Cash Management Services

Real time gross settlement
National electronic funds transfer
1.5 FUNCTIONS
The bank provides financial assistance for the benefit of Handicapped persons/
orphans/ poor patients suffering from serious ailments. Provides direct assistance
or through Prime Ministers Relief Funds or Chief Ministers relief Funds or any
other National or State level to needy who have suffered due to natural disaster
and calamities.
Helps in rehabilitation of handicapped children/ persons belonging to depressed
classes of society.
Provides financial support to orphanages.
Provides scholarships to meritious students of depressed sections of the society at
various levels with focus on the needy.
Provides financial assistance for protection of environment/ ecology.
1.6 SPECIALISED FINANCES
Help Tourism (For Kashmir Valley only)

All purpose Agri term Loan
Fruit advances scheme(apples)
Zafran finance
Roshini finance scheme
Dastkar finance
Giri finance scheme
Commercial premises finance
1.7 OBJECTIVES
To educate and provide the underprivileged sections financial services through

intervention and community participation.
To chive balanced economic growth with social justice.
To generate incomes to buy the food requirements above the subsistence level
To ensure productive employment opportunities and other social conditions
To raise the standard of people and alleviate poverty.
To promoter health, sanitation, communication and education.
CREDIT POLICIES
Credit policies are essentially aimed at supporting the business strategies,

achieving target earnings with satisfaction of customer needs and maintaining a sound
credit portfolio.
Main objectives:
Create a framework to ensure smooth and timely flow of credit to the banks
customers, ensure a prudent credit growth- both qualitative and quantitative- and
to augment interest & non interest income within the statutory framework
prescribed by RBI.
Adhere to the lending norms prescribed by the bank, RBI & Govt. from time to
time.
Ensure consistency in and standardization of credit practices.
Ensure balanced sectoral & diversified growth of credit so as to have a proper risk
spectrum within prudential exposure norms.
Evolve a well defined system to identify, measure, monitor and control various
risks attached to credit portfolio of the Bank.
BALANCE SHEET OF J&K BANK
BALANCE SHEET OF J&K BANK
(In Rs. Cr)
PARAMETERS MAR16 MAR17 YOY
% (Change)
Sources of funds
Share capital 48.49 48.49 0.00%
Share warrants and 0.00 0.00 0.00%

out standings
Total reserves 6,061.56 5,675.12 6.81%
Shareholders fund 6,110.05 5,723.61 6.75%
Deposits 65,756.19 69,335.86 -5.16%
Borrowings 2,339.67 1,765.00 32.56%
Other liabilities and 1,879.54 1,795.25 4.70%

provisions
TOTAL 76,085.45 78,619.73 -3.22%

LIABILTIES
Application of funds
Cash and balance 2,373.06 3,045.59 -22.08%

with reserve bank of
India
Balance with banks 1,360.71 1,168.31 16.47%

and money at call and
short notice
Investments 25,124.30 26,195.07 -4.09%
Advances 44,585.82 46,348.60 -3.88%
Gross blocks 1,317.27 1,074.53 22.59%
Accumulated 662.52 568.01 16.64%

depreciation
Impairment of assets 0.00 0.00 0.00%
blocks 654.75 506.52 29.26%
Lease adjustments 0.00 0.00 0.00%

Capital work in 34.16 27.29 25.17%
progress
Other assets 1,952.66 1,292.35 51.09%
TOTAL ASSETS 76,085.45 78,619.73 -3.22%
Contingent liabilities 21,697.24 16,140.72 34.43%
Bills of collection 1,173.09 1,235.89 -5.08%
INTRODUCTION OF LOANS
LOAN: A loan is a type of debt. Like all debt instruments, a loan entails the redistribution
of financial assets over time, between the lender and the borrower. In a loan, the borrower
initially receives or borrows an amount of money, called the principal, from the lender, and is
obligated to pay back or repay an equal amount of money to the lender at a later time.
Typically, the money is paid back in regular installments, or partial repayments; in an annuity,
each installment is the same amount. and restrictions is enforced by contract, which can also
place the borrower under additional restrictions known as loan covenants.
Acting as a provider of loans is one of the principal tasks for financial institutions. For other
institutions, issuing of debt contracts such as bonds is a typical source of funding. Types of
loans
Secured
Unsecured
Secured Loans:
A secured loan is a loan in which the borrower pledges some asset (e.g. a car or property) as
collateral for the loan.
A mortgage loan is a very common type of debt instrument, used by many individuals to
purchase housing. In this arrangement, the money is used to purchase the property. The
financial institution, however, is given security a lien on the title to the house until the
mortgage is paid off in full. In some instances, a loan taken out to purchase a new or used car
may be secured by the car, in much the same way as a mortgage is secured by housing. The
duration of the loan period is considerably shorter often corresponding to the useful life of
the car. There are two types of auto loans, direct and indirect. A direct auto loan is where a
bank gives the loan directly to a consumer. An indirect auto loan is where a car dealership
acts as an intermediary between the bank or financial institution and the consumer.
A type of loan especially used in limited partnership agreements is the recourse note.
A stock hedge loan is a special type of securities lending whereby the stock of a borrower is
hedged by the lender against loss, using options or other hedging strategies to reduce lender
risk.
Unsecured Loans:
Unsecured loans are monetary loans that are not secured against the borrower's assets. These
may be available from financial institutions under many different guises or marketing
packages:
credit card debt

personal loans
bank overdrafts
credit facilities or lines of credit
corporate bonds
The interest rates applicable to these different forms may vary depending on the lender and
the borrower. These may or may not be regulated by law. In the United Kingdom, when
applied to individuals, these may come under the Consumer Credit Act 1974. Customer's
expectation from banks while taking loan
Banks and financial institutions touch all most every body life in more than one ways. From a
simple saving accounts to credit cards, fixed deposits, personal loans, car loans, educational
loans, home loans etc. they offer a host of services.
Here is a list of things that one should expect from their bank or any financial institutions
while taking a loan. The customer should be provided with all the necessary information
about a particular product so that he is able to determine the pros and cons of the particular
product. If a customer has applied for loan his application should be acknowledged and a
timeframe should be given within which the bank will take its decision and convey it to the
applicant.
The banks and the financial institutions should clearly communicate the interest rates on
different loan products through various popular media like the banks branches, outlets,
websites, print and other media.
CSR ASPECT OF THE BANK
The Corporate Social Responsibility (CSR) of the J&K Bank seeks to recognize
obligations towards society and aims to integrate the CSR ideals into its
mission for optimizing both business and social performance.
It stresses on promoting work life balance, give attention to social and
environmental concerns and host of factors that facilitate business pursuits and
accomplishment of economic goals.
The Bank besides playing its role in economic development of
the State and country contributes significantly towards the social cause. Be it
victims of natural calamity, like fire, flood, snowstorm or tsunami and disabled or
patients with serious ailment who lack reliable means of survival, the bank has been
all through supporting them.
Heritage preservation is an important responsibility of every conscious individual,

institution or agency. The thrust areas to assist in this respect for the Bank will be
preservation of historical/religious monuments, development of tourist sites,
national properties, museums, libraries, protection of environment/ecology etc.
The Bank has been playing a vital role in the promotion of tourism and it is in
this backdrop that the Bank has been shouldering the responsibility of
registering yatris for the Shree Amarnath ji Yatra through its extensive
network of branches spread across the country.
In addition to this, accidental insurance cover facilitity of Bajaj Allianz General

Insurance Co. Ltd. to the pilgrims at a nominal premium is made available to the
yatris.
Apart from above activities the Bank has been constructing/developing the public
utility service like public parks, bus stands, drinking water posts, laboratories,
conveniences, rain shelters. In addition to this, the bank organizes relief camps,
service camps, night shelters, health resorts, health clinics, disaster calamity
management centers, rehabilitation centers etc.
CHAPTER-2
INTRODUCTION TO PROJECT
AND
RETAIL LOAN IN RELATION TO THE EXTANT
SCHEMES OF THE BANK
EDUCATIONAL LOAN SCHEME
Education Loan Scheme for Pursuing Higher Education in India & Abroad
1. ELIGIBILITY CRITERIA:
1.1 Student eligibility:
Should be an Indian National

Should have secured admission to a higher education course in recognized institutions
in India or Abroad through Entrance Test/ Merit Based Selection process after
completion of HSC(10 plus 2 or equivalent).
Entrance test or selection purely based on marks obtained in qualifying examination
may not be the criterion for admission to some of the post graduate courses or research
programmes. In such cases, sanctioning powers shall lie with A&AP, CHQ which will
take a view of extending the education loan based on appropriate criteria of
employability and reputation of the institution concerned.
Sanctioning powers in such cases shall lie with President, A&AP, CHQ.
Note: It would be in order for business units to consider a meritorious student (who
qualifies for a seat under merit quota) eligible for loan under this scheme even if
the student chooses to pursue a course under Management Quota.
2.2 Courses eligible

a. Studies in India: (Indicative list)
Approved courses leading to graduate/ post graduate degree and P G diplomas

conducted by recognized colleges/ universities recognized by UGC/ Govt./ AICTE/
AIBMS/ ICMR etc.
Professional courses: Engineering, Medical, Agriculture, Veterinary, Law, Dental,
Management, Computer etc.
Courses like ICWA, CA, CFA etc.
Courses conducted by IIM, IIT, IISc, XLRI. NIFT,NID etc.
Regular Degree/Diploma courses like Aeronautical, pilot training, shipping, degree/diploma
in nursing or any other discipline approved by Director General of Civil
Aviation/Shipping/Indian Nursing Council or any other regulatory body as the case may be, if
the course is pursued in India.
Approved courses offered in India by reputed foreign universities.
Courses offered by National Institutes and other reputed private institutions.
2.3. The above list is indicative in nature. Bank may approve other job oriented courses
leading to technical/ professional degrees, post graduate degrees/diplomas offered by
recognized institutions under this scheme.
2.4. Courses other than the above offered by reputed institutions may also be considered on the
basis of employability. Part-time courses, research work and job oriented specialized programs
could be considered based on merit and placement records at banks discretion
2.5. In respect of Courses, which are not covered under the criteria mentioned above,
A&AP Department, CHQ shall take a view for extension of education loan under the
scheme taking into account the future prospects / recognition by user institution. In
such cases, sanctioning powers shall lie with A&AP, CHQ which will take a view of
extending the education loan based on appropriate criteria of employability and
reputation of the institution concerned.
b. Studies abroad: -
Graduation: For job oriented professional/ technical courses offered by reputed

Universities.
Post graduation: MCA, MBA, MS, etc.

Courses conducted by CIMA- London, CPA in USA etc.
Degree/diploma courses like aeronautical, pilot training, shipping etc provided these
are recognized by competent regulatory bodies in India/abroad for the purpose of
employment in India/abroad.
Classification
Advances allowed under Education loan Scheme upto Rs 10 lacs in respect of studies in India
and Rs 20.00 lacs for studies abroad will be classified as priority sector.
3. EXPENSES CONSIDERED FOR LOAN:
Fee payable to college/ school/ hostel. Reasonable lodging and boarding charges will be
considered in case the student chooses / is required to opt for outside accommodation. Such
expenses may be capped at 20% of the total loan sanctioned.
Examination/ Library/ Laboratory fee.

Travel expenses/ passage money for studies abroad.
Insurance premium for student borrower, if applicable.
Caution deposit, Building fund/refundable deposit supported by Institution bills/receipts,

subject to the condition that the amount does not exceed 10% of the total tuition fees for the
entire course.
Purchase of books/ equipments/ instruments/ uniforms*.
Purchase of computers at reasonable cost, if required for completion of the course*.
Any other expense required to complete the course - like study tours, project work, thesis,
etc*.
Note: For courses under Management quota seats considered under the scheme, fees as
approved by the State Government/Government approved regulatory body for
payment seats will be taken, subject to viability of repayment.
* It is likely that these expenditures may not be available in the schedule of fees and
charges prescribed by the college authorities. Therefore, a realistic assessment may
be made of the requirement under these heads. However, the maximum expenses
included under these heads may be capped at 20% of the total tuition fees payable for
completion of the course.
4. QUANTUM OF FINANCE:
Need based finance taking into account expenses worked out as per specifications mentioned
above after considering the margins mentioned at Para 5 below, subject to repayment
capacity and following ceilings *.
Studies in India - Maximum `10.00 lacs.

Studies Abroad - Maximum ` 20 lacs
* The ceilings fixed for studies in India and abroad correspond to the limits fixed by the RBI for
treatment as priority sector lending. Operative levels may consider higher quantum of loan on course
to course basis (eg: courses in IIMs, ISB etc). It may also be noted that even loans in excess of ` 10
lakhs qualify for interest subsidy under Central Sector Interest Subsidy Scheme for loans up to ` 10
lakhs. (For cases where loans in excess of ` 10 lakhs is provided for studies in India, the Central
Subsidy Scheme can be availed for portion of loan upto ` 10 lakhs.)
Sanctioning powers for loan amount beyond above ceilings shall lie with President, A&AP
Department, CHQ.
5. MARGIN:
Upto ` 4 lacs Nil
Above ` 4 lacs : Studies in India 5%
Studies Abroad 15%

Scholarship/ assistantship to be included in margin.
Margin may be brought-in on year-to-year basis as and when disbursements are made
on a pro-rata basis.
6. SECURITY:
For pursuing courses in IIT/IIM/ISB*:

For loan up to Rs.10.00 lacs- Co-obligation of parents/ guardian, 3rd party guarantee of 2
persons and assignment of future income of the student. No collateral security is
required
*ISB means Indian School of Business, Hyderabad.
For others:
Up to ` 4.00 lacs Parents to be joint borrower(s).

No Security
Besides the parent(s) executing the documents as joint
borrower(s), collateral security in the form of suitable third
Above ` 4 lacs and up to party guarantee will be taken. The Bank may, at its discretion,
in exceptional cases, waive off third party guarantee if
` 7.5 lacs. satisfied with the net-worth / means of parent/s who would be
executing the document as joint borrower(s).Such powers
shall lie with President, A&AP Department
Parent(s) to be joint borrower(s)

Above `.7.5 lass Tangible collateral security of suitable value acceptable to
bank.
7. RATE OF INTEREST:
As circulated by A&AP Department, CHQ from time to time.
Servicing of interest during study period and the moratorium period till
commencement of repayment is optional for students. Accrued interest will be added to
the principal amount borrowed while fixing EMI for repayment.
Simple interest to be charged during the study period and up to commencement of

repayment. At the time of account opening, business units shall give Interest on
Interest flag (in Interest Details) as N so that interest can be applied as simple. Once
the moratorium period is over, Interest on Interest flag (in Scheme details) shall be
reset to Y so that compounding can happen there on.
Concession of 0.50% on interest rate shall continue to be allowed in case of

education loans availed by girl students (circular No.CR-42-413 dated
06.03.2009).
Students pursuing courses from IITs / IIMs and ISB shall be extended 0.50%
concession in rate of interest (circular no. 171 dated 02/09/2008).
1% interest concession shall be provided by the bank, if interest is serviced during

the study period and subsequent moratorium period prior to commencement of
repayment. At the time of commencement of repayments, B. Units shall be
required to make necessary modifications in interest fields of specific accounts to
ensure that interest rebate of 1% is provided only till commencement of
repayment starts (circular no. 171 dated 02/09/2008).
The concessions in pricing are subject to effective price not falling below the floor
limit of Base Rate.
9. REPAYMENT:
Repayment of the loan will be in equated monthly installments for periods as under:
For loans up to `7.5 lakhs - upto 10 years

For loans above `7.5 lakhs - upto 15 years
Repayment shall start after Repayment holiday/Moratorium period , which shall be as

under;
Repayment Course period + 1 year or 6 months after getting job, whichever is

holiday/Moratorium earlier.
The accrued interest during the repayment holiday period to be added to the principal and
repayment in Equated Monthly Installments (EMI) fixed.
If the student is not able to complete the course within the scheduled time, extension of
time for completion of course may be permitted for a maximum period of 2 years. If the
student is not able to complete the course for reasons beyond his control, Sanctioning
authority (which has sanctioned the case) may at his discretion consider such extensions
as may be deemed necessary to complete the course. In case the student discontinues the
course midway, appropriate repayment schedule will be worked out by the Business Unit
in consultation with the student/parent
While EMI based repayment is the generally accepted practice, many times the salary
levels at the start of the career may not facilitate comfortable payment of EMI in certain
cases (e.g. professionals like Doctors). Telescoping of repayment with stepped up
installments with passage of time may be considered in such cases. Such ballooned
repayment shall be normally allowed only if allowed at the time of initial sanction,
clearly documented in the sanction letter and applicable from the first repayment
installment.
Penal interest @ 2% be charged for non-repayment of loan installments, subject to

provisions of priority sector advances, i.e.
Up to Rs 25,000- Nil
Above Rs 25,000 As applicable to retail advances,(Presently 2% on default/ irregular

portion).
9. PREPAYMENT
Prepayment shall be allowed without any prepayment penalty, during the repayment period.
Pre-payment penalty of 0.25% of the outstanding loan amount shall be applicable, for
repayment before the repayment period.
10. INSURANCE
B.Units, with the consent of borrowers, shall arrange for Life insurance of the borrower to the
tune of the loan amount, preferably with MetLife India ltd.
11. FOLLOW UP/TRACKING:
Students to arrange for furnishing of his progress report from the institution at regular
intervals to the concerned B.Unit. In case of studies abroad, student to provide SSN/Unique
Identification Number (UIN)/Identity Card to the B.Unit which shall note the same in its
records. The UID number issued by UIDIA may also be captured in banks system as and
when available.
12. PROCESSING CHARGES
For studies in India-Nil.
For Studies abroad Upfront fee @ 1% of the loan amount sanctioned with a maximum of `
5,000 to be refunded on availment of loan.
13. CAPABILITY CERTIFICATE:
Some of the foreign universities require the students to submit a certificate from their bankers
about the sponsors' solvency/ financial capability, with a view to ensure that the sponsors of
the students going abroad for higher studies are capable of meeting the expenses till
completion of studies. Such capability certificates may be issued by the branches after
obtaining financial and other supporting documents from applicant / guardian / co-obligator,
if required.
14. OTHER CONDITIONS:
14.1. Sanction of loan to more than one child from the same family
Existence of an earlier education loan to the brother(s) and/or sister(s) will not affect
the eligibility of another meritorious student from the same family obtaining
education loan as per this scheme from the bank.
14.2. Age Limit
There is no specific restriction with regard to the age of the student to be eligible for
education loan. However, if the student was a minor while the parent executed
Documents for the loan, the bank will obtain a letter of ratification from him/her upon
attaining majority. The upper age limit shall be capped at 50, which can be relaxed on
case to case basis. Such relaxation powers shall be with President, A&AP, CHQ.
14.3. Top up loans
Top up loans to students pursuing further studies within the overall eligibility limit
can be considered on merits of each case, if such further studies are commenced
during the moratorium period of the first loan. The repayment of the loan will
commence after the completion of the second course and further moratorium period,
as provided under the scheme.
14.4. Joint Borrower
The joint borrower should normally be parent(s)/guardian of the student borrower. In

case of a married person, joint borrower can be spouse or the parent(s)/parents-in-law.
15. No Due Certificate
No due certificate need not be insisted upon as a pre-condition for considering

educational loan. However, B.Unit may obtain a declaration / an affidavit confirming
that no loans have been availed from other banks / branches.
16. Change of Address
In cases of student staying with parents and where such parents have transferable jobs
or there is change in address, the student borrower and his / her parents would be
required to keep the Bank well informed of any change in address. An undertaking
from the co-obligator parents shall be obtained in this regard.
17. Disposal Application
Loan applications have to be disposed of in the normal course within a period of 15

days to 1 month, but not exceeding the time norms stipulated for disposing of loan
applications under priority sector lending.
18. Relaxation / Flexibility in terms:
Relaxation / flexibility in terms like eligibility, margin, security norms, shall be

considered on case-to-case basis by A&AP, Corporate Office. Powers for the same
shall be vested with President, A&AP Department and CHQ.
19. Tie-Ups with Educational Institutions
All existing tie-ups with various educational institutions shall continue as per the terms
& conditions already circulated from time to time.
20. Pre-sanction documentation (Check list):

Education Loan Application Form duly filled in.
Mark sheets of last qualifying examination
Letter of admission from the Institute.
Schedule of expenses for the specified course, from the institution.
2 passport size photographs of the co-applicants.
Income proof of the co-applicant (Pay Slip / ITR copy etc) & Guarantor, if applicable.
Statement of assets and liabilities of the Co-borrower/ Guarantor.
KYC documents for the Applicant & Co-applicant (Residential proof, ID proof)
Proof of Age.
In case the loan is collaterally secured by mortgage of immovable property, copy of Title Deed,
MEC from approved lawyer of the Bank to be obtained at the cost of the borrower.
The valuation report from approved valuer of the Bank at the cost of the applicant borrower.
Education loans with tenure up to 5 years (at fixed interest rate )
Educational loans with tenure exceeding 5 years (at floating interest rate)
Up to Rs.5.00 lacs NA NA 12.25%
Above Rs.5.00 lacs & NA NA 13.25%
up to Rs10.00 lacs
Above Rs.10..00 lacs & NA NA 14.00%
up to Rs20.00 lacs
Up to Rs.5.00 lacs PLR-3.00% BR+1.50% NA

Above Rs.5.00 lacs & PLR-2.00% BR+2.50% NA
up to Rs10.00 lacs
Above Rs.10..00 lacs & PLR-0.75% BR+3.75% NA

up to Rs20.00 lacs
CASE STUDY-EDUCATION LOAN
Zonal Office Jammu (Central)
C CREDIT PROPOSAL DATED 12.01.2015

Education loan in favour of Ms. Saahitpreet Kour (borrower) and Mrs. Harminder Pal Kour
Raina (Co-borrower)
1. Student Data:
Name of the student : Ms. ABC,XYZ
Date of Birth : 23.03.1996
Educational Qualification : Higher Secondary Part-II (12th)
2 Particulars of Mother (Co-borrower)
Name of Mother : Mrs. Harminder Pal Kour Raina
Residential Address : H.No. 121/2, ward no. 3, Govind Pura Satwari,

Jammu Cantt
ENW Rs 22.00 lacs as per Cr
Occupation of Mother : Pensioner
3. Particulars of course study
Name of the proposed course : Bachelor of Nursing along with Certificate in

Prehealth Science
Name of the Institution/University : Christchurch Polytechnic Institute of Technology,

Christchurch, New Zealand
Duration of course : 3 Years 4 Months (2015-18)
Date of commencement : Feb-2015
Expected monthly income : Rs. 150000/- (Approx. NZ$3000 min)
Loan applied : Rs. 16, 00,000/-
4. Securities offered:
Primary: 1. Assignment of the future income of the student for payment of the installments.
2. Co-obligation of Mother (Co-borrower).
Collateral:
Mortgage of plot of land measuring 8 marlas along with house property constructed over it
standing in the name of Ms. Saahitpreet Kour D/o S. Harbajan Singh valuing Rs. 38.67 lacs as
per valuation dated 6.01.2015 (distressed value Rs. 30.93 lacs).
Third party guarantee of two Persons Namely
1. Sh. Sunpreet Singh Raina (Age 33 years)
S/o S. Harbajan Singh Raina
R/o H.no. 121/2, ward no. 3 govind Pura, Satwari Jammu-180003
ENW Rs 15.45 lacs as per Cr dated 6.01.2015

2. Sh. Satish Koul (Age 46 years)
S/o Sh. H N Koul
R/o 25, Lane no. 7, Buta Nagar, Paloura, Jammu
ENW Rs 28.66 lacs as per Cr dated 6.01.2015
5. Introduction:
Ms. Saahitpreet Kour (borrower) and Mrs. Harminder Pal Kour Raina (Co-borrower) have
approached BU Gandhi Nagar for an education loan of Rs 16.00 Lacs for pursuing 3 years & 4 months
for carrying three year Bachelor of Nursing degree course from Christchurch Polytechnic Institute of
Technology, Christchurch, New Zealand.
Ms. Saahitpreet Kour (borrower) has completed higher secondary part-II (class 12 th) from
CBSE Board in 2013 (copy of marks certificate enclosed). Now he has secured admission in 3 year 4
months Bachelor of Nursing degree course from Christchurch Polytechnic Institute of Technology,
Christchurch, New Zealand. The proposed borrower has already received letter of acceptance from the
college. The entire course fee for the course is 69458/- NZD$ which is approximately Rs 33,88,252/-
(taking one NZ Dollar as Rs. 49.00). The borrower is paying margin money of Rs. 17,88,252/-
(52.78%) and has applied Education loan for the rest of the amount i.e. Rs. 16,00,000 (47.22%). The
branch has stated that the amount of loan shall be utilized for payment of tuition fee in such case
we will consider the amount of tuition fee alone for computation of MPBF and the rest amount
i.e. boarding and lodging expenses to be paid from own sources.
Mrs. Harminder Pal Kour Raina (Co-borrower) is a Pensioner and drawing pension from B/U
Gandhi Nagar and has net monthly pension is Rs. 12538/-. The younger brother of the applicant is
already working in New Zealand. After completion of the course, a minimum of INR 1,50,000/- is
likely to be earned by the applicant on monthly basis which is sufficient to pay the EMI of the loan.
6. Fee Structure:
The total expenses of the course are estimated at 69148= NZ Dollar which are approximately Rs
33,88,252/- approximately as per copy of letter of admission of the Institute attached along with the
proposal. The borrower has requested for a loan facility of Rs 16,00,000/-. The breakup of the
expenses is given hereunder: The conversion rate is Rs 49.00(approx) as viewed over internet:
S.no. Particulars Amount in NZ Amount in Rs
Dollar
01. Certificate in Pre Health & $ 7864.00 Rs.3,85,336/-

Science-L3 7.
2.02.2015-12.06.2015
02 Bachelor of Nursing L7 $ 61284.00 Rs. 3,00,29,16/-
July-2015-July-2018
Total $ 69458.00 Rs. 33,88,252
Bank Finance Rs. 16,00,000
Borrower Rs. 17,88,252
MPBF:-
a) Total fee of the course : Rs 33,88,252/-
b) Margin stipulated @15% : Rs 5,08,238/-
c) Margin Offered : Rs 17,88,252/- (52.78%)
d) Loan requested/recommended : Rs. 16,00,000/- (47.22%)
e) Permissible Loan : Rs 16,00,000/-
(a-b OR c whichever is less)
8. Repaying Capacity:-
After Course period & moratorium: -
Total Loan amount : Rs 1600000/-
Repayment Perio : 7 years
Rate of Interest BR+3.25% (Floating)
Interest during moratorium to be factored in repayment
(After providing 0.50% concession on account of girl Child as permitted vide circular no. Cr-42-
213 dated-6.03.2009)
Expected monthly income of the : Rs 150000/-
Student (after course completion)
09. Recommendations: -
Keeping in view, the foregoing we may if approved sanction an Education loan of Rs.16,00,000/-
(Rupees Six Lac only) in favour of Ms. Saahitpreet Kour (borrower) and Mrs. Harminder
Pal Kour Raina Co-Borrower) for 3 years & 4 months for pursuing Bachelor of Nursing
degree course from Christchurch Polytechnic Institute of Technology, Christchurch, New Zealand
against following securities, terms & conditions:
Securities offered
Primary: 1. Assignment of the future income of the student for payment of the installments.
2. Co-obligation of Mother (Co-borrower).
Collateral:
Mortgage of plot of land measuring 8 marlas along with house property constructed over it
standing in the name of Ms. Saahitpreet Kour D/o S. Harbajan Singh valuing Rs. 38.67 lacs as
per valuation dated 6.01.2015 (distressed value Rs. 30.93 lacs).
Third party guarantee of two Persons Namely
1. Sh. Sunpreet Singh Raina (Age 33 years)
S/o S. Harbajan Singh Raina
R/o H.no. 121/2, ward no. 3 govind Pura, Satwari Jammu-180003
2. Sh. Satish Koul (Age 46 years) S/o Sh. H N Koul
R/o 25, Lane no. 7, Buta Nagar, Paloura, Jammu

Terms & Conditions:
Interest: BR +3.25 % p.a(Floating)
Interest during moratorium to be factored in repayment
(After providing 0.50% concession on account of girl Child as permitted vide circular no. Cr-42-
213 dated-6.03.2009)
Penal interest: As applicable under the scheme.
Moratorium period Course Period + 1 year
OR
Course Period + 6 months after getting the job, whichever is earlier.
Disbursement: The amount of loan to be disbursed in stages as per the schedule of the
University after obtaining the requisite margin and Payments to be made
directly in favour of the Institute through Account Payee Demand draft or
Online Transfer against demand letter of the college and a proper receipt to
be obtained. Branch to obtain the Fee Structure of the entire course from
the concerned institute & place a copy of the same on record.
S.no. Particulars Amount in NZ Amount in Rs

Dollar
01. Certificate in Pre Health $ 7864.00 Rs.3,85,336/-

& Science-L3
2.02.2015-12.06.2015
02 Bachelor of Nursing L7 $ 61284.00 Rs. 3,00,29,16/-
July-2015-July-2018
Total $ 69458.00 Rs. 33,88,252
Bank Finance Rs. 16,00,000
Borrower Rs. 17,88,252
Margin: Rs 17,88,252/-- The margin to be brought- in and total fees to be disbursed to the college.
However, any increase in course fee and other education related expenses (like boarding and
lodging) will be borne by the applicant from their own sources. The escalation in the currency shall
also be borne by the borrower.
Repayment: Principal + Interest accrued during the moratorium to be re-paid in 84

equated monthly (7 years) installments commencing one year after
completion of course or 6 months after getting the job whichever is
earlier. EMI to be computed at time of start of repayment.
Insurance: Accidental insurance policy of at least equivalent to the loan amount to be

kept by the student with usual Bank clause in the policy. The cost of the
insurance to be borne by the co-borrower.
Processing Charges 1% of the loan amount sanctioned with a maximum of Rs 5,000 subject to the
conditions that this amount would be adjusted against the loan amount once
the loan is availed from our bank.
CAR LOAN SCHEME

Clause Particulars
1) Name of the J&K Bank Car Finance Scheme (Fresh Cars) for
Product Individuals / Proprietorship Concerns.
a) Permanent Employees of State / Central Government,

Government / Semi-Government Undertakings &
2) Eligibility Autonomous Bodies.
b) Employees of Private Limited Companies, Private
Organizations, Reputed Establishments & Employees on
contractual basis with Central/State Government,
Government/ Semi-Government Undertakings&
Autonomous bodies*
c) Professionals, Self Employed Individuals & Proprietorship
Concerns.
d) Persons engaged in agricultural and allied activities.
e) Retired Employees of State / Central Government, Public
Sector Undertaking
For purchasing New Car/ Van/ Jeep/ SUV/ MUV For Private
Use Only
Joint borrowers are also eligible.
*Employees on contractual basis with Central/State

Government, Government/Semi-Government Undertakings&
Autonomous bodies shall be eligible, if they have been in
current contractual job for a period not less than I year and the
remaining contract period is longer than the chosen repayment
period. Employees on adhoc basis shall not be eligible.
Eligibility Criteria: (For a & b)
Minimum age of Applicant: 21 years.
Maximum age of Applicant at loan maturity: 60 years or

age of retirement whichever is earlier.
Minimum employment: The applicant must have been in

current employment for a period of not less than 1 year.
Minimum Gross Annual Income: 3.00 Lakh
Eligibility Criteria: (For c & d)
Minimum age of Applicant: 21 years
Maximum age of Applicant at loan maturity: 70years
Experience: At least 3 years in business.
Eligibility Criteria: (For e)
Maximum age of Applicant at loan maturity: 70 years

3) Maximum 36 months net monthly salary of the applicant or 3 times
Loan Amount / net annual income. However, in case of employees of
Quantum of private organizations, employees on contract basis and
Finance
pensioners, the maximum finance shall be limited to 24
CASE STUDY CAR LOAN
Re :Car loan proposal of Mr. Lalit Rai

B/o :TPT, Shastri Nagar, Jammu
Name and address of borrower
Mr. Lalit Rai S/o Shri Krishan Kumar Rai R/o 29, Durga Bhawan, Amphala,
Jammu.
Details of the case
Sanction of loan : Rs.3.75 lacs

EMI : Rs.8800
Rate of interest : 11.50%
Term of loan : 5 years
Date of advance : 19.11.07
Security : - Hypothecation of the vehicle
- Collateral security by third party Guarantee of
two person
Quantum of loan
Cost of vehicle {Tata Indigo (STDI)}: Rs.5, 03,999.00
Advance payment to the Dealer : Rs.20, 000
Balance : Rs.4, 83,999
Loan : Rs.3, 75, 000
Margin Money : Rs.1, 08,999
Documents Attached
1) Car Loan Application form
2) Credit report of Borrower i.e. Mr. Lalit Rai
3) Personal statement of borrower
4) Copy of Income Tax Return of Borrower
5) Copy of Pan (Permanent A/c Number)
Legal Documents
D.P Note (Hindi)
Consent Letter of Borrower.

Loan Agreement
Letter of Authority Letter

of Undertaking
Trust receipt (Not to Breach or Hypothecation agreement)

Hypothecation Agreement
Affidavit
Irrevocable power of authority.

Consent letter of Guarantor Deed of
Guarantee
HOUSING LOAN SCHEME
1. Title J&K Bank Housing Finance Scheme for Individuals.
2. Nature of Facility Term Loan.

3. Sector Loans to individuals up to Rs.25 lakh in Metropolitan centers
Classification with population above 10 lakh and Rs. 15 lakh in other
centers for purchase/construction of a dwelling unit per family
(excluding loans sanctioned to banks own employees)
th
sanctioned on or after 20 July 2012 shall be classified
as priority sector loans.
Loans for repairs to the damaged dwelling units of families
up to Rs.2 lakh in rural and semi- urban areas and up to Rs.5
lakh in urban and metropolitan areas sanctioned on or after
20th July
2012 shall be classified as priority sector
4. Purpose/ Types of loans.
For purchase of a plot only, provided a declaration is obtained
Constructions eligible from the borrower that he will construct a house on the said plot, with
for finance. the help of bank finance or otherwise, within a period of 2 years.
Advance is not permitted against plots purchased
on power of attorney basis
Supplementary finance in the shape of additional loan may be
granted within the overall ceiling for carrying out alterations/
additions/repairs to the house/flat already financed.
Finance for repairs & renovation of house/flat already
constructed with own resources or having no housing loan
outstanding.
Housing loan can be sanctioned for purchase/construction of
nd
2 house, provided the borrower is not availing any housing
loan or has adjusted the previous housing loan, if any, against
st
the 1 house.
rd
Housing loan cannot be sanctioned for 3 house.
5. Eligibility Individuals having regular income, who belong to any of the following
categories:
a) Salaried Individuals:
Individuals working in Govt. Deptt (State/Central) as a
confirmed employee.
Individuals working in Public Sector Undertakings/Autonomous
Bodies / Reputed Companies /Bodies with a minimum of 3
years of service.
b) Professionals/ Self Employed :
Professional/Self employed doctors, engineers, dentists,
architects, chartered accountants, cost accountants, company
secretaries, management consultants, advocates etc, with a
minimum 3 years standing in the current profession.
6. Age of borrower 1) Minimum: 18 years as on date of sanction.
2) Maximum: 65 years (70 years in case of pensioners) i.e. the age
by which the loan shall be fully repaid, subject to availability of
sufficient, regular and continuous source of income for
servicing the loan repayment.
However, age can be relaxed upto 70 years (72 years in case

of pensioners) in those cases only where the tenor of loan has
been increased to keep the EMI unchanged in case of floating
interest rate loans on the request of borrower.
7. Maximum Quantum of For the purpose of estimation of loan assistance, project cost shall be
Finance estimated on a realistic basis, at current cost of construction, ensuring at
the same time utmost economy in the use of land, building materials and
built-up space. Accordingly the loan amount shall be assessed as under:
i. Loan for fresh construction/purchase of house/flat: Need
based subject to Maximum of 72 times of net monthly
income/salary.
ii. For State/Central Govt Pensioners: 36 times of the

gross monthly pension subject to the condition that loan
sanctioned shall be fully repaid by the time pensioner attains the
age of 70 years and total deductions do not exceed 50% of their
home take monthly pension.
iii. Loan for carrying out repairs / renovations / additions

/ alterations to a borrower who is not availing any housing
loan: Maximum Rs.15.00 lacs or 36 times of net monthly
income/salary whichever is lower.
iv. Supplementary/Additional Finance for carrying

out repairs/renovations/additions/alterations to a person who
is already availing housing loan from the bank:
Maximum
Rs.10.00 lacs or 36 times of net monthly income/salary
whichever is lower subject to the condition that total loan (i.e. BOS
of existing loan + sanctioned amount of additional loan) as on date
of sanction is within the overall ceiling of housing loan limit of 72
times net monthly income/salary.
v. Purchase of land: Housing loan facility can be sanctioned for

purchase of land/plot to be used for construction of house. The
finance for purchase of land/plot shall form part of housing loan
within the overall entitlement under the scheme and shall be
restricted to the extent of maximum 36 times net monthly
income/salary of the applicant borrowers or Rs.15.00 or 75% of the
cost of plot of land whichever is less, provided the area of proposed
land shall not be more than 5440 Sq ft or 1 Kanal. Loan amount
shall be within the overall ceiling of housing loan limit of 72 times
of net monthly income/salary.
Note: Bank will not finance land purchase of more than 5440
sq ft or 1 kanals for housing purpose.
vi. Loan for construction of house in case borrower is availing

housing loan for purchase of land for housing purpose: Loan
Limit in such cases shall be fixed after deducting BOS in existing
loan as on date of sanction within overall limit of maximum 72
times net monthly income/salary i.e. BOS in the existing loan
account and fresh loan to be sanctioned shall not be more than
72 times net monthly income/salary as on date of sanction.
8. Income Calculation I. For salaried borrower last salary certificate having complete
details of present deductions of borrower, date of joining, date of
retirement & date of birth shall be relied upon. Net salary as per pay
slip shall be compared with salary account statement of borrower
and any variations shall be inquired into. For arriving at Net
income/salary, additional PF/RD Installments shall not be
reckoned as deductions.
II. Income of spouse, son / father / mother & brother, if
working/earning, may be added for the purpose of arriving at
net monthly Income for computation of loan limit provided:
a) All the persons whose income is considered for calculation of
loan limit shall be the co-borrowers i.e. loan to be sanctioned in
joint names.
b) All the persons, except spouse, have to be the joint
owners of the land/flat/house.
c) In case of person who is already availing any loan or the
income is already charged in case of any other liability, only
residual income will be considered.
d) Account statements & ITRs (if applicable) of all the persons
shall be obtained to verify their quantum of income.
III. Eligibility criteria for service/minimum business standing of
family members for computation of loan limit shall be similar as
mentioned for borrower under Eligibility norms.
IV. For businessmen/professionals income can be assessed/verified
from the last three years Income Tax Returns, Audited/Certified
Balance sheet/Profit & loss A/C etc (as per requirement)supported
by ITRs.
9 Margin/ Loan to Value For fresh construction/purchase.

Ratio Loan Amount Minimum Maximum LTV
Margin Ratio
Upto Rs.20.00 lacs 15%* 85%**
Above Rs.20.00 lacs 20%* 80%**
*Cost of plot of land as per sale deed in case of purchased land
and Forced sale value of land in case of owned land, can be taken
as part of margin contribution by the borrower subject to
obtaining of valuation report from the approved valuer on panel
of bank or sale deed as the case may be.
** Stamp duty, registration and other documentation charges shall not
be included in the cost of the housing property to be financed so that
the effectiveness of LTV norms is not diluted. In case of already built
houses/flats LTV is the ratio of the fair market value of an asset to
the value of the loan granted for purchase of the asset and is
calculated by dividing the loan amount by the fair market value of the
property. Loan-to-value tells the lender if potential losses due to
nonpayment of the loan can be recouped by selling the asset. Cost of
land is also to be included in the fair value of property if the land is
mortgaged to the bank.
For Supplementary/ repairs/renovation/additions/alterations:
For Loans Upto Rs.5.00 lacs :
NIL
For Loans above Rs.5.00 lacs
&
Upto Rs.10.00 lacs : 10%.
For Loans Above Rs.10.00 lacs :
15%
10. Security Purchase/Construction:
Primary:
Equitable/ Registered Mortgage of house property/flat to
be constructed/ purchased. (House property to include
land underneath & appurtenant thereto in case of
independent house only).
The title of the property must be clear, marketable and
free from encumbrance.
Collateral:
rd
No collateral security/3 party guarantee is required for
Govt. Employees drawing their salaries through the bank
and where their employer undertakes to deposit the
monthly salary in the borrowers salary account.
In case of pensioner guarantee of spouse, who is entitled
for family pension, to be obtained.
In other cases, third party guarantee of one or two person of
sufficient net worth to withstand the guarantee shall be
obtained.
Or
Assignment of Life insurance policies, Government securities,
NSCs, Shares and debentures or such other tangible security of
adequate value as is deemed appropriate by the Sanctioning
Authority.
rd
In case of NRIs 3 party guarantee of two resident Indian of
sufficient means to cover the liability apart from the other
securities shall be obtained.
11. Door to Door Tenor of 20 years or number of remaining years of service in case of
Loan employees or till the borrower attains the age of 65 years (70
years in case of pensioners only) whichever is earlier including
moratorium period.
However, tenor can be increased to maximum 25 years and
age to maximum 70 years (72 years in case of pensioners) only
in those cases where borrower has opted for increase in tenor of
loan to keep the EMI unchanged due to increase in
interest rates for floating interest rate loans.
In case of employees increase in tenor is subject to
availability of remaining service period.
12. Moratorium Period Maximum 9 months from the date of disbursement in case of
loans sanctioned for construction of house/flat.
Maximum 3 months in case of loans sanctioned for
repairs/renovations/additions etc.
Maximum 3 months in case of loans sanctioned for outright
purchase of fully built up flat/apartment/land for
housing purpose.
Till date of possession as mentioned in the agreement or
maximum 3 years, in case of under
construction builder/society flat/house.
13. Disbursement A. For construction of house/flat: To safeguard the banks
interests and to prevent the misuse of funds, disbursement
shall be made only in phases co-related to the actual progress
made in the construction e.g. at stages like completion of
plinth, completion of linter level, completion of roof etc. The
disbursement plan has to be drawn up and disbursement made
only after the branch is fully satisfied about the proper end use of
funds by making site inspection and correlating ground realities.
Moreover, it has to be ensured that the borrower contributes the
stipulated margin on pro rata basis while making first and
subsequent disbursements of the sanctioned loan.
B. For outright purchase of fully built house/flat/land: After

obtaining the requisite margin money from the borrower the
payment shall be remitted directly to the vendors/seller/builder
by means of Crossed Accounts Payee Demand Draft/Bankers
cheque in the court at the time of registration at the written
request of the borrower and against receipt from vendors.
C. For under construction builder/society flat/house: To be

made in phases closely linked to the stages of the construction of
housing project as per agreement between builder/society &
borrower through account payee instruments only in favour of
the builder/society. Upfront disbursal of entire loan in lump-
sum should not be made in cases of incomplete/under-
construction/green field housing projects.
14. Repayment Principle along with interest shall be repaid in Equated
Monthly
Installments (EMIs) after moratorium which shall be refixed with
every increase/decrease in interest rate during the tenor of loan in
case of floating interest rate loan. However, EMI shall not become
less than the amount fixed at the time of initial sanction due to
decrease in interest rate.
The repayment period and the EMIs calculated for repayment shall
be decided on the merits of each case on a realistic basis after
taking into account the repaying capacity of the borrower.
While fixing the EMI it has to be ensured that:
i. Total Deductions do not exceed 50% of the
borrowers
Gross monthly income.
ii. Total Deductions do not exceed 60% of the
borrowers gross monthly income in case borrower
has monthly gross income of more than Rs.30000.00
and is a Govt. employee.
iii. Estimated Income tax, PF contribution, Payment
of
Insurance premium and other compulsory
deductions shall be included for computing the gross
deductions..
The loans for carrying out repairs or additions shall be repaid in
Equated Monthly Installments (EMIs) within a maximum period of
10 years including moratorium period of 3 months.
Repayment period of loans sanctioned for purchase of plot of
land for housing purpose shall be the same as for fresh
construction.
For pensioners repayment period shall be 10 years or till the
pensioners attains the age of 70 years whichever is earlier.
However, borrower may be given option to choose for increase
in repayment period by maximum 5 years (2 years in case of
pensioners) in order to keep the EMI unchanged due to increase
in interest rates for floating interest rate loans. However, In case
of employees such increase in tenor shall commensurate with
their remaining service period.
Interest during moratorium has to be serviced by the borrower as
15. Interest Rate As per latest Interest Rate Circular.
16. Processing Charges 0.25% of the loan amount with minimum of Rs. 500 and maximum
of Rs 10000, plus applicable service tax.
In case of takeover from other banks/FIs, no processing charges
will be levied.
B/U to mention the loan processing charges on the sanctioned
letter issued to borrower.
17. Prepayment Penalty As per latest service charges schedule

B/Us to stipulate the prepayment charges, if any, in the sanction
letter issued to the borrower. Prepayment charges on loans
sanctioned at Dual Rates / Special Rates i.e. which are fixed for first
few years and floating thereafter shall not be charged from the
date the rate of interest on loans becoming floating.
Note: No Pre-payment penalty to be charged on housing loans
granted on floating interest rate basis.
18. Documents (Personal & A. Documentation for Borrower/s(For all applicants)
Financial).
Personal Documents:
Pre-Sanction. Duly filled in application form signed by applicant (s).
Two Latest passport size photographs of applicant (s).
Identity & Residence Proof: As per KYC norms
Age proof. The documents which could be submitted for
the same are Passport, , Date of birth certificate from
Municipality or equivalent body, School leaving certificate
or any other document to the satisfaction of the Bank
Address Proof of Office (For Business men/ Professionals
& Self Employed Individuals only): Recent Utility bill
/ Lease deed / Excise or Sales Tax Receipt/Shops &
Establishment Act Registration, etc.
A photocopy of Registration Certificate of establishment
under Shops and Establishments Act/Factories Act
(wherever applicable)
Certificate of Practice (for professionals only)
Signature identification from present bankers (for non-
customers only).
Financial Documents:
i. Salaried Customers: Last Pay Certificate showing
all deductions. Pay certificate shall also have information
about the DoB of the applicant, date of joining & date of
retirement.
ii. Business men/Professionals & Self Employed
Individuals: Last 3 years Income Tax Returns (self and
business) & last 3 years Profit /Loss and Balance Sheet
Certified/Audited by Chartered Accountant as per statutory
requirements.
iii. Bank account Statement of prospective borrower(s) for last
six months. In case of salaried employees, statement of
account shall be of that account in which their salary is
being credited. In other cases it shall be of the account
declaration of which has been made in the income tax
returns. This is to facilitate ascertaining general conduct of
the account including his/her other borrowings.
iv. Letter of Confirmation, wherever available.
v. Details of all obligations and loans taken, outstanding
balance, EMI liability of all current loans and repayment
record of all previous loans to be submitted by applicant/s.
vi. Income proof of spouse (if spouse income is to be clubbed).
B. Documentation for
Guarantor/s
Two photographs
Proof of identification
Proof of residence.
Proof of business address( If applicable)
Income Proof.
Personal Statement of Assets and Liabilities
Signature identification from present bankers (for non-
customers only).
19. Documentation A. Construction of house on a plot of land already owned by the
(Pre-sanction) Applicant (In J&K State).
Intikhabi Jamabandi attested by Tehsildar/ Naib Tehsildar
concerned.
Intikhabi Khasra-e-Girdawari attested by Tehsildar/ Naib
Property Documents Tehsildar concerned.
Aksa-e-Shajra attested by Tehsildar/ Naib
Tehsildar concerned.
Naqsha-Amini (If the land falls within municipal limits of
Srinagar, J&K).
Khaka-e-Dasti (If the land falls outside municipal limits of
Srinagar, J&k).
Copy of Sale Deed/ Lease Deed.
In case of properties leased out to borrower by Govt
agencies on perpetual lease basis, letter of authority from
appropriate authority permitting mortgage.
Permission for construction from the Designated
Government Authority.
Copy of order under the Urban Land Ceiling Act.
Copy of certificate from the collector that the subject piece
Non-encumbrance certificate.
Detailed cost estimate from Banks panel/approved Chartered
Engineers/Architects.
D. Purchase of a built house/Construction of house on a plot

of
Land to be purchased by Applicant ( In J&K State)
Proof of title to the vendor
Deed of Conveyance, duly stamped & registered, by virtue of
which the seller has acquired the title to the property.
In case of properties leased out to borrower by Govt agencies
on perpetual lease basis, letter of authority from appropriate
authority permitting mortgage.
Permission for construction from the Designated Government
Authority. In case of construction of house on land to be
purchased, permission shall be required after availing the
loan for purchase of land but before loan for construction of
house is released in his favour.
Copy of N.A. permission for the land from the collector.
Detailed cost estimate/ Valuation Report from Bank
empanelled /approved Chartered Engineers/Architects.
E. Repairs/Renovation/Addition/Alteration of house
In case the property is to be mortgaged: Same as in the
case of Construction of house on a plot of land already owned
by the Applicant.
In case the property not to be mortgaged: Applicant
shall furnish documents of title in his possession for
verification of his title over the property.
Permission for construction from the Designated Government
Authority.
Nonencumbrance Certificate & Detailed cost estimate from
Bank empanelled /approved Chartered Engineers/Architects
is to be submitted in both cases.
F.Purchase of a built Flat i)

Direct from Builder
Deed of Conveyance, duly stamped and registered.
Title Documents e.g. Sale Deed/s, Gift Deed/s, Lease Deed
by virtue of which the Seller/Lessee has acquired the title
over the flat. Chain of title to be established including
verification of title of the actual builder.
Permission for Construction from the
Designated
Government Authority.
Development agreement between the owner of land and
the builder
Property register card from City Survey Department.
of land is non agricultural land.
Commencement certificate & Occupation certificate
granted by Corporation/Nagar Pallika /Development
Agency, etc.
No Objection Certificate from the builder on his letterhead.
Letter from the builder/architect indicating the latest
progress of construction for under construction cases
A certificate by the legal adviser of the builder to the effect
that the builder has a good reputation and it is free from
encumbrances and other charges.
A certificate from builders Chartered Accountant
certifying
that the builder has not mortgaged the property anywhere
else.
Partnership deed or memorandum of association of the
builders firm/ Company.
Original stamped receipts for the payments already made
to the builder , till date.(if applicable)
Clearance from the appropriate Income Tax authorities if,
applicable.
In case of leasehold property, letter of authority from
Latest receipt of taxes paid towards the flat to be
purchased.
ii) Directly in Registered Co-operative Housing

Society :
Original share certificate issued by the society (if issued,
if not then NOC from the builder)
Copy of the lease deed, if executed.
Certificate of the registration of the society
Copy of the bye laws of the Society
Deed of Conveyance, duly stamped and registered.
Title Documents e.g. Sale Deed/s, Gift Deed/s, Lease
Deed by virtue of which the Seller/Lessee has acquired the
title over the flat. Chain of title to be established including
verification of title of the society.
Permission for Construction from the Designated Authority
of the Government in this regard.
Property register card from City Survey Department.
Commencement certificate & Occupation certificate
granted by Corporation/ Nagar Pallika /Development
Agency, etc
The latest receipts of taxes paid for the property
No Objection Certificate from the society, on
their letterhead.
of land is non agricultural land.
Original stamped receipts for the payments already made
to the society , till date.(if applicable)
iii) Directly from any Development
Authority
Deed of Conveyance, duly stamped & registered.
Copy of the lease deed, if executed.
Original receipts, issued by the Development
Authority, for the payments made for the flat, if applicable.
Letter f r o m t h e D e v e l o p m e n t A u t h o r i t y indicating
the latest progress of construction for under construction
flats.
Non-encumbrance Certificate.
20. Title Verification/ Search A) Within J&K State: Title Verification report shall be obtained
Report (Pre-Sanction) from Law Department of Concerned Zonal Office.
B) Outside J&K State: B/U to obtain search report, non-
encumbrance certificate, title verification report from the local
lawyer in the panel of approved lawyers o f the bank.
21 Legal Documents Loan Agreement.
D. P. Note.
Post Sanction & Pre Deed of guarantee (where ever applicable).
Agreement to Sell.
Disbursement Letter of undertaking.
Mortgage Deed/ Letter of Deposit of Title Deeds/ Memorandum of
entry/ Letter of Negative Lien ( as applicable)
Affidavit for construction/purchase/repair & renovation
of
house/flat.
Irrevocable Power of Attorney.
In case of purchase of under-construction/ to be constructed
house or flat from the Housing Board/ Society or a Construction
Company/ Builder (where mortgage cannot be created
immediately), a tripartite agreement shall be executed amongst
the 1) Housing Board/ Society /Construction Company/ Builder, 2)
The Borrower and 3) The Bank wherein Housing Board/
Society
/Construction Company/ Builder shall undertake that the title to
Borrower shall be transferred to the Borrower immediately on
receipt of the entire sale consideration and the Banks lien shall
also be marked in their records, thereafter to be followed by
execution of mortgage Deed in favour of the Bank once the project
has been completed and Sale Deed (Deed of apartment/
Conveyance Deed also in case of Flats) has been executed. Besides
tripartite agreement an affidavit cum undertaking from the
Housing Board/ Development Authority / Co-operative Society/
Construction Company/ Builder to the effect that the construction
shall be as per the sanctioned plan & building bye -laws
Charge to be registered in favour of the Bank with the concerned
authorities.
Post dated Cheques, wherever applicable.
An affidavit-cum-undertaking shall be obtained from the borrower
to the effect that he/she shall not violate the approved
construction plan & construction shall be strictly as per the
sanctioned plan, in case of constructions.
An affidavit-cum-undertaking that the built up property has been
constructed as per the sanctioned plan and/or building bye-laws
shall be obtained in case of purchase of built up house/flat.
Any other documents as suggested by Local Lawyer on panel of
bank/ Law Department of the bank.
NOTE: In case of loan for purchase of built up house/flat/land, the

branch shall issue account payee payment order/bankers cheque in
the name of the seller. The payment whereof shall be subject to
execution and production of registered sale deed. B/Us shall
ensure that the sale deed is executed for the full amount of
consideration/ sale price accepted by the bank as per the
agreement to sell submitted by the borrower. The payment can be
made to the seller in the court of law at the time of registration of
sale deed. Thereafter, registered/equitable Mortgage of property
purchased out of bank finance shall be done within 7 days from the
date of release of loan.
Besides the above, the following documents shall also be obtained
while formulating the proposals at the branch level.
i. Agreement for sale/detailed cost estimates and plan from a
technically qualified architect/approved engineer.
ii. Approved plan of flat/house sanctioned by the
Municipality/Local Authority along with copy of building
permission.
iii. Letter of undertaking to meet the escalation of the cost from
personal resources to be obtained from the borrower.
22. Procedure for vetting of A) Within J&K State: Legal Documents to be obtained in
legal documents. consultation with the Law Department of concerned Zonal
office along with the vetting certificate.
(Pre-
B) Outside J&K State:
Disbursement)
B/Us to obtain set of security documents (copy/original) as
suggested by Lawyer required for creation of valid charge in
favour of the bank.
Draft of set of legal documents to be also obtained from local
lawyer.
All these documents along with copy of search report, title
verification report & others to be forwarded to Law Department
of concerned Zonal Office for vetting purpose.
After receiving the vetting report, legal documents to be
prepared on stamp papers as per local laws, executed by the
borrower/guarantors and mortgage shall be created in favour
of the bank in consultation with Local Lawyer on panel.
23. Other Important Lein of bank/valid charge should be created with the concerned
Instructions authority/ies.
In case of equitable mortgages, charge to be created with
CERSAI within 30 days from the date of deposit of title deeds
with the bank.
Loans for purchase of an old house/flat/apartment under the
scheme can be granted provided that the age of
house/apartment/flat is not more than 20 years at the time of
sanction of loan. Further, in case of such loans B/U to
obtain
residual life certificate of house/flat from approved Civil
Engineer on panel of bank and ensure that the remaining
life of house/flat is not less than the proposed total tenor of
the loan.
Branch Head/Credit Officer shall also inspect such
properties and satisfies itself about the quality of
construction and residual life of house.
Escalation in cost, if any, shall be met by the borrower
exclusively from his/her own sources. An undertaking shall be
obtained from the borrower to that effect before disbursing the
loan.
A close follow-up/monitoring has to be maintained over the
construction of houses/tenements to be constructed with housing
loans to ensure proper end use of funds. The loans shall
preferably be sanctioned / availed at the branch nearest to the
construction site.
Satisfactory documentary evidence, such as, original titles
to
the property and connected documents with legal
opinion, original plans as sanctioned by the
municipality/local authority (Notified/Town Area
Committees), estimates of the houses/flat prepared by a
technically qualified Architect/Engineer as required by local
laws shall be obtained and verified.
Monitoring & follow up of the housing
loans sanctioned/disbursed, including pre-sanction/post
disbursement inspection of the house financed, regular
recovery of loan installments/interest, renewal of insurance
cover for the property etc. shall be meticulously done. Cases of
default in repayment of installments shall be monitored closely
and necessary follow-up action taken expeditiously.
The flat/house either acquired or built with loans obtained
under the scheme cannot be sold till the entire loan along with
interest is repaid by the borrower. If the house/flat is rented
out, the borrower shall undertake that the entire rental
income, even if it is more than the prescribed repayment
installment will be utilized towards repayment of the loan.
Housing loans shall not be sanctioned for repayment of loans
availed from friends/relatives, private financial
institutions/societies. However, payment to debtors on
account of supply of construction material etc, to
the borrower, before availment of housing loan,
may be
considered on production of credible documentary
evidence.
The borrower will open his account with the branch and shall
have to confine all his banking transactions with the branch.
Letter of confirmation has to be obtained from DDOs of
the
employees except from those employees who are drawing
their salary through saving accounts maintained with
J&K Bank.
B/Us to write a letter to the DDOs of the concerned employee
informing them about sanctioning of housing loan in favour of
the employee. The letter shall be posted through registered
post only and shall not be sent through the employee in any case.
Branches to ensure that correct classification of loans has been
made, correct interest rate codes & proper repayment details
filled in while opening the housing loans accounts.
In light of Supreme Court of India orders banning any transfer
of property on General Power of Attorney or Sale Agreement,
housing loan shall not be allowed for purchase of
house/flat/Plot on power of attorney basis.
24. Takeover of Housing Branches may take over housing loan accounts of borrowers availed
loan from other Banks from other Banks/ FIs after ensuring the following:
/ Financial Institutions a. That the loan availed has been utilized properly and the party
(FIs) has contributed his/her margin, thereby having sufficient Loan
to Value ratio / security cover to the bank.
b. The party has not defaulted in repayment with its existing
lender.
c. The party fulfills all the terms of housing loan scheme of our
bank.
d. Account statement & Sanction letter of existing housing loan
account shall be obtained to ensure that the repayment has been
regular and there are no overdues in the account of the party with
transferee bank.
e. Accounts having risk rating grade of 1 to 5 in case of Govt
Employees and risk rating grade of 1 to 3 in other cases only are
eligible for takeover.
f. Computation of income & MPBF shall be strictly done as per
scheme norms.
25. Sanctioning Powers. As per existing power structure circulated by A&AP CHQ Srinagar.
26. Special Instructions a. B/U to issue sanction letter to the borrower on its letter head
mentioning all the terms & conditions of the sanction viz.
amount of loan, tenor of loan, moratorium period, repayment
period, no. & amount of EMIs, interest rate fixed/floating,
processing charges, prepayment charges if any and all other
conditions. Copy of sanction letter dully acknowledged by
borrower & guarantor(s) shall be kept on record.
b. Branch to obtain a declaration from the borrower that he will
construct a house on the plot acquired out of the bank finance,
with the help of bank finance or from any other source, within a
period of 2 years otherwise bank is allowed to charge 3%
additional interest from the date of disbursement of loan till full
& final adjustment of loan and in case of pre-payment of said
loan, if house is not constructed, 2% prepayment penalty in
addition to 3% extra interest shall be paid on outstanding amount
as on date of prepayment.
c. Housing Loan for building construction:
i) In cases where the applicant owns a plot/land and
approaches the bank for a credit facility to construct a
house, a copy of the sanctioned plan/approved
construction plan by competent authority in the name of the
person applying for such credit facility shall be
obtained before sanctioning the housing loan.
ii) An affidavit-cum-undertaking shall be obtained from the
borrower to the effect that he/she shall not violate the
approved construction plan & construction shall be strictly
as per the sanctioned plan.
iii) Branch Head/Manager Advances to monitor the
construction of house regularly and shall obtain a
certificate from the competent authority that
construction of buildings is strictly as per the sanctioned
plan.
d. Housing Loan for purchase of constructed property/ built up
property
i) Certificate from competent authority that the built up
property is strictly as per sanctioned plan and/or building
bye-laws has been followed shall be obtained before
disbursement.
ii) An affidavit-cum-undertaking that the built up property
has been constructed as per the sanctioned plan and/or
building bye-laws shall be obtained.
e. Unauthorized colonies: No loan shall be given in respect of
those properties which fall in the category of unauthorized
colonies unless and until they have been regularized and
development and other charges paid.
f. Commercial Property: No loan shall be given in respect of
properties meant for residential use but which the applicant
intends to use for commercial purposes and declares so while
applying for loan
27. Follow Up A close follow-up has to be maintained over the construction of

house/tenement to be constructed with housing loan, to ensure
proper end-use of funds.
Supervision and control over the housing loans
sanctioned/disbursed, including pre-sanction/post disbursement
inspection of the unit financed, regular recovery of loan
installments/interest, renewal of insurance cover for the property etc.
shall be meticulously done. Cases of default in repayment of
installments shall be monitored closely and necessary follow-up
action taken expeditiously.
28. Failure to commence In case construction of the house is not completed within 2 years
construction/ Non from date of initial disbursement of the loan, penal interest rate at
Completion of 2% over & above the prescribed rate of interest shall be charged.
construction within In case of Purchase of land and construction of house thereon, the
stipulated time. construction must commence on the purchased plot within 24 months
from the date of initial disbursement and must complete within 4
years of the initial disbursement, failing which penal interest rate at
2% over & above the prescribed rate of interest will be charged in
case of breach of either or both of the deadlines.
In case of under construction builder/society flats the above
conditions will not apply.
29 Risk Weight on Housing

loans
Amount of Loan LTV ratio =or<75 % LTV ratio >75 %
Up to Rs 30 lacs 50% 100%
Above Rs 30 lacs 75% 100%
30. Procedure for Post Minimum 24 Postdated cheques complying with CTS-2010 standard
dated Cheques/ formats signed by borrower towards repayment of monthly
RECS/ ECS. installments along with Letter of Deposit and one undated cheque with
blank amount field to be obtained from borrowers other than Government
Employees/Pensioners drawing salary/pension through our branches in
locations where the facility of ECS/RECS is not available. The cheques
shall be drawn in the name of The Jammu & Kashmir Bank Limited
Housing Loan Ac No. XXXX of Mr./Ms. YYYYYY and borrower
details shall be written on reverse.
31. Issuance of Interest Branches may issue Interest Certificates, on demand,
Certificates the
borrower(s) who have availed housing loan from the bank to enab
them to avail benefits under the provisions of income tax act. Su
certificates shall be issued on the prescribed Preforma.
RATE OF INTEREST HOUSING LOAN
LOAN AMOUNT INTEREST RATE PRESENT EFFECTIVE

INTEREST RATE
Upto Rs 50.00 lacs B.R i.e +9.85% 9.85%
Above 50-75 lacs BR+0.75% p.a 10.55%
Above Rs 75lacs B.R+1.50%p.a 12.05%
CASE STUDY FRESH HOUSING LOAN
Reg: Fresh Housing loan in favour of S Amarjeet Singh (Borrower) for renovation of the
house
1.1 1. Branch Office Nanak Nagar jammu
2. Name & Address of the borrower :

1. S Surjeet Singh (age 61 years)
S/o S Bhagat Singh
R/o H.No F -43 Sector 14 Nanak Nagar Jammu. ENW Rs 55.00 Lacs.
2. Mrs. Gurdeep Kour (47 years) W/o S Surjeet

Singh R/o H.No F -43 Sector 14 Nanak Nagar
Jammu.
3 Occupation : 1. Pensioner.
2.Business (boutique)
4. Monthly Income : Gross Deductions Net

1. Pension slip for the M/o Sept 2013 Rs.16203/- Rs 3534
Rs.12669 2 As per ITR2013-14 Rs 21500/- Rs 518 Rs.
20982
Total Rs 37703/- Rs 4052
Rs.33651
5. Remaining Service : not applicable
6. Purpose of loan : Renovation of house
7.Loan requested : Rs. 10.00 lacs
8. Securities offered : Registered Mortgage of land measuring 01 Kanal

80sft comprising Khewat No 141, Khata No
199, Khasra No 385 situated at Chhani Rama
Jammu (H .no 43-F Sector 14 Nanak Nagar)
along with construction thereupon Standing in
the name of S Surjeet Singh valuing Rs 71.00
lacs as per valuation report of M/s Architect
Allied dated16.03.2013.
Third party guarantee of two persons.
9. Profile of the Guarantor:
1. Sh kamal Preet Singh (33 years)
S/o S Surjeet Singh ,
R/o H.No 43-F Sector 14 Nanak Nagar Jammu
Occupation: Govt Employee (Naib Tehsildar) ENW Rs 13.00 lacs.
10. Total cost of renovation : Rs 13.41 lacs.

Prepared by M/s Architect Allied
11. Recommendation of the branch : Rs.10.00 lacs

12. Details of existing loan facilities: Nil
14. Branch Recommendations : The Branch has recommended for sanction of

housing loan of Rs.10.00 lacs in favour of the
applicant for renovation of house on the
securities mentioned above.
15. Background of the Applicant:
The instant loan proposal has been submitted by BU Nanak Nagar Jammu recommending
their in for sanction of a housing loan of Rs 10.00 lacs for renovation of the existing house in
favour of S Surjit Singh & Mrs. Gurdeep Kour.
The proposed borrower is a pensioner retired from Consumer Affairs& Public Administration
Deptt and the co borrower namely Mrs. Gurdeep Kour is the spouse of the borrower and
running boutique from her residence.
The branch has submitted that the title verification of the property proposed to be mortgaged
was obtained by Law Department vide letter No JKB/ZOJ/2011-2081 dated 27.07.2011 along
with non encumbrance certificate of the advocate when the proposed borrower had availed
mortgage loan of Rs 7.80 lacs sanctioned Vide Zonal Office sanction No ZOJ/JKB/Adv/2011-
296 dated 29.10.2011. As reported by the branch the said loan stand liquidated by the party
on 03.12.2012.
15. Quantum of loan:
Estimated Cost of completion of house : Rs.13.41 lacs
Stipulated Margin@ 10% : Rs.1.34 lacs
Margin Offered : Rs.3.41 lacs
A) Permissible Bank Finance : Rs.10.00 lacs
B) Gross Monthly income of the borrowers : Rs.37703/-
Net monthly salary of the borrowers : Rs.33651/-
36 times net monthly salary : Rs.5.69 lacs
C) Eligible Amount
( A or B whichever is less) : Rs. 12.11 lacs
16. Repayment:
Loan amount : Rs.10.00 lacs
Repayment Period : 97 months
Moratorium : 03
Rate of Interest : BR i.e. 10.25 % (Floating)
EMI : Rs.15300/-
Gross Monthly Income of the borrower : Rs37703/-
Present deductions : Rs.4052/--
Installment of Proposed Loan : Rs.15300/-
Total Deductions : Rs.19352-
%age deductions : 51.32 %
Since the deductions have exceeded 50% of the gross income. we may reduce the quantum of
loan to Rs 9.50 lacs and recalculate the deductions
Loan amount : Rs.9.50 lacs

Repayment Period : 97 months
Moratorium : 03
Rate of Interest : BR i.e. 10.25 (Floating)
EMI : Rs.14500/-
Gross Monthly Income of the borrower : Rs37703/-
Present deductions : Rs.4052/--
Installment of Proposed Loan : Rs.14500/-
Total Deductions : Rs.18552/-
%age deductions : 49.20 %
So we may consider a loan of Rs 9.50 lacs in favour of the borrowers.
7. Recommendations:
Keeping in view the foregoing paras and recommendations of the branch, we may, if
approved, accord sanction for a Housing Loan of Rs.9.50 lacs (Rupees Nine Lacs and fifty
thousand only) in favour of S Surjit Singh & Mrs. Gurdeep Kour for renovation of
house No F-43 Sector 14 nanak Nagar Jammu against the following securities, terms and
conditions:
Securities: -
Primary: -
Registered Mortgage of land measuring 01 Kanal 80sft comprising Khewat No 141, Khata
No 199, Khasra No 385 situated at Chhani Rama Jammu (H .no 43-F Sector 14 Nanak
Nagar) along with construction thereupon Standing in the name of S Surjeet Singh valuing
Rs 71.00 lacs as per valuation report of M/s Architect Allied dated16.03.2013.
Collateral: Third party guarantee of two persons namely:
1. Sh Ravinder Singh S/o Sangat Singh R/o Upper Gadigarh Jammu . ENW Rs
28.00 lacs as per Cr dated 04.11.2013.
2. Sh kamal Preet Singh (33 years) S/o S Surjeet Singh, R/o H.No 43-F Sector 14 Nanak
Nagar Jammu
Terms & Conditions:

a. Margin : Rs.3.91 lacs or 10% of the cost of renovation which ever is higher Any
escalation in cost shall be borne by the proposed borrowers from their
own resources
b. Interest : BR i.e 10.25% p.a with monthly rests or such other rate of interest as
may be prescribed by the bank from time to time. Interest to be charged
monthly on daily outstanding balances.
c. Moratorium : 03 months
d. Disbursement : The loan amount for completion of house shall be disbursed as and
when required in favour of the borrower after satisfying that the
borrower has invested the stipulated margin contribution. Branch to
release the amount along with margin directly in favour of suppliers by
way of payees a/c PO and keep a record of bills.
Branch will ensure that there is no diversion of funds for purpose other than renovation
of house.
e. Repayment: Loan amount shall be repayable in 97 equated monthly installments

of Rs.14500/- each commencing three months after the disbursement.
f. Insurance: The house property to be insured from a reputed insurance Co against all risks
with usual Bank Clause at the partys cost.
g.Prepayment Penalty: As per latest service charges schedule.
h.Processing: As applicable
Charge.
RESEARCH METHODOLOGY
RESEARCH METHODOLOGY
OBJECTIVE OF THE STUDY:
The objective of my study / learning is to:
o See what has been the Bank's contribution towards the retail loan.
o How the Bank's policies have under gone change to facilitate the growth of
this sector, over the years.
o Up to what extent the bank has been able to achieve the targeted growth in this
sector.
SCOPE OF THE STUDY:
Since the concept of customer satisfaction is very wide with varied dimensions, the study
views pertaining to experience and expectation of the customer regarding Retails Loans
rendered by J&K Bank as compared to other Banks.
METHODOLOGY:
The study is conducted by collecting data through personal contact & discussion with
customers , the selected sample of different branches of J&K Bank .The main method of
study includes information collected through structured questionnaire administered
personally from the customer of the different branches of J&K Bank.
SAMPLE DESIGN: Since the study aims to examine the comparative study of Retail Loans
in J&K Bank with other Banks .A sample of 150 customers were selected by following the
random selection procedure by giving due representation to each customer in different
branches of J&K Bank.
DATA ANALYSIS AND INTERPRETATION

PEOPLE TAKING LOAN:
Total no. of people No. of people taking loan No. people not taken loan
150 65 85
Thus, it clear that out of 150 respondents 65 people i.e. 43% have taken loan and 85
respondents i.e. 57% have not taken loan.
PREFERENCES FOR HOME LOANS:
Out of 150 Customers
SBI J&K Bank ICICI PNB Other
60 50 8 11 21
Thus, from the above table and pie chart one can easily determine that 60 respondents i.e.
40% preferred to take home loans from SBI, 50 respondents i.e.34% from J&K Bank, 8
respondents i.e.5% from ICICI, 11 respondents i.e7% from PNB and 21 respondents i.e. 14%
will opt. other Bank for Home Loan.
PREFERENCES FOR PERSONAL LOANS:
45 65 10 8 22
Thus, from the above table and bar graph one can easily determine that 45 respondents
preferred to take Personal loan from SBI ,65 respondents from J&K Bank, 10 respondents
from ICICI, 8 respondents from PNB and 22 respondent will opt. other Bank for Personal
Loan.
59
PREFERENCES FOR EDUCATIONAL LOANS:
60 55 8 10 17
Thus, from the above table and graph one can easily determine that 60 respondents preferred
to take Education loan from SBI, 55 respondents from J&K Bank, 8 respondents i.e.5% from
ICICI, 10 respondents from PNB and 17 respondents will opt. other Bank for Education
Loan.
PREFERENCES FOR CAR LOANS:
60 70 6 8 6
Thus, from the above table and graph one can easily determine that 60 respondents preferred
to take car loans from SBI, 70 respondents from J&K Bank, 6 respondents from ICICI, 8
respondents from PNB and 6 respondents will opt. other Bank for Car Loan.
ANALYSIS OF FORMALITIES OF J&KBANK WHETHER GENUINE OR NOT
Genuine Not Genuine
110 40
Thus , it is clear that out of 150 maximum no. 110 think that formalities which J&K Bank
ask for taking loan is genuine and 40 believe that it is not genuine.
ANALYSIS OF ADVERTISEMENT NEEDED BY J&KBANK
People in favors of People against
120 30
In response to this question 120 people thinks that J&K Bank should go for advertisement
and 30 people were against it.
LEVEL OF SATISFACTION WITH J&KBANK
Highly Satisfied Satisfied Normal Not Satisfied
10 70 55 15
It is depicted from the above pie chat that majority of respondents i.e. 46% are satisfied, 7%
are highly satisfied, 37% are normal, and 10% are not satisfied with J&K Bank.
64
PEOPLE'S PREFFERED BANK OTHER THAN J&K BANK:
Out of 150 customers
ICICI SBI PNB Other
15 60 40 35
Thus it is clear that out of 150 people 15 people would prefer ICICI Bank , 60 would prefer
SBI, 40 prefer PNB, and 35 would prefer other bank against J&K bank
SATISFACTION OF INTEREST RATES PROVIDED BY J&KBANK AS
COMPARE TO OTHER BANKS
Out of 150 customers
Yes No
90 60
Thus, it is clear that out of 150 , 90 respondents are satisfied with the interest rate provided by
J&K Bank and 60 are not satisfied.
IS J&K BANK CONTINOUSLY IMPROVING ITS SERVICES
Yes No
110 40
Thus, one can easily depict that majority of respondent i.e. 73% believes that J&K Bank is
continuously improving its services and 27% are against it.
Suggestions:
All banks are providing finance to retail loans and each one is having some unique and
some common things. However the banks having dominance in retail loans generally
provide loans to people living in cities having good source of income. But if we see the
performance of J&K Bank it provides retail loans facility not only to people living in
cities but also to those living in far flung areas having extreme climatic conditions and
no infrastructure. Moreover the retail loan schemes of J&K Bank are so good that a
common man can also easily avail such schemes on bearable rate of interest and on easy
terms.
In my view point I may suggest to bank

To open Separate specialized branches for retail loans considering the fact that
beside salary class business class is also availing various types of loans from J&K
Bank resulting in heavy rush in branches due to which many times a normal
customer unable to get proper attention.
I also suggest that the appraisal process should also be simplified
More powers need to be given to the branch heads for immediate sanction
of loans and for negotiation of rate of interest applied on loans which are at
present are not given to the branch heads.
Findings:
The following are the main findings of the survey:-
1) Personal Loan:- PNB Bank charges processing fees which make their personal
loan policy more expensive as comparison to J&K Bank.
2) 3rd party guarantee is required in PNB Bank whereas no 3rd Party guarantee is
required in J&K Bank for this purpose.
3) Car Loan:-For availing such facility from PNB Bank one has to give security other
than car, no such security is required in J&K Bank.
Housing Loan:- Processing charges are quite high in PNB Bank

CONCLUSION
At J&K Bank the bank provides loans at affordable rate of interest so that not
only the rich people can avail the benefits but also the people living in far flung
and remote areas having limited sources in the same roof with much ease and
comfort.
With this information we can conclude that there is good organizational

collaboration.
Besides it the customers are fully satisfied with the organization and responded
in a positive attitude towards the organization. Satisfaction level of most
respondents is higher for J&K Bank ltd.Therefore the customers are highly
comfortable about J&K Bank ltd. And as a part of the study on Retail loans it can
be concluded that J&K Bank Ltd is successful in attaining its goal and objectives
along with the higher level of satisfaction, productivity and endeavor of the
customers.
After conducting a study on the topic Retail loans for J&K Bank Ltd. we came
to know that there is a very good work done by J&K Bank.
Bibliography
Retail lending, Credit monitoring, Documentation and Recovery
management
(Book by D.D Mukherjee)
Financial Management
(Book by N.S.Toor)
J&K Bank Loans and Advances Manual
www.j&kbank.net
(Website of J&K Bank)

www.rbi.org.in (Website
of RBI Bank)
www.icicibank.com
(Website of ICICI Bank)
www.statebankofindia.com
(Website of SBI Bank)
www.pnbindia.com
(Website of PNB Bank)
68
69

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PROJECT REPORT

THE JAMMU&KASHMIR BANK LTD

For the degree of

Submitted by: Supervised by:

It is my Pleasure to place on record my sincere gratitude towards my research guide Mr.

INTRODUCTION J&K BANK

Incorporated in 1938 as a limited company.

Private sector Bank despite government holding 53 per cent of equity.

Sole banker and lender of last resort to the Government of J & K.

Salaries of state Government officials disbursed by the Bank.

Only private sector bank designated as agent of RBI for banking.

Carries out banking business of the Central Government.

Collects taxes pertaining to Central Board of Direct Taxes in J & K.

1.3 MISSION OF J&K BANK

To provide the people of J&K internationally Quality financial services and

1.4 PRODUCTS AND SERVICES

Cash Management Services

1.6 SPECIALISED FINANCES

Help Tourism (For Kashmir Valley only)

To educate and provide the underprivileged sections financial services through

Credit policies are essentially aimed at supporting the business strategies,

Ensure consistency in and standardization of credit practices.

(In Rs. Cr)

PARAMETERS MAR16 MAR17 YOY

Share capital 48.49 48.49 0.00%

Share warrants and 0.00 0.00 0.00%

Total reserves 6,061.56 5,675.12 6.81%

Shareholders fund 6,110.05 5,723.61 6.75%

Deposits 65,756.19 69,335.86 -5.16%

Borrowings 2,339.67 1,765.00 32.56%

Other liabilities and 1,879.54 1,795.25 4.70%

TOTAL 76,085.45 78,619.73 -3.22%

Cash and balance 2,373.06 3,045.59 -22.08%

Balance with banks 1,360.71 1,168.31 16.47%

Investments 25,124.30 26,195.07 -4.09%

Advances 44,585.82 46,348.60 -3.88%

Gross blocks 1,317.27 1,074.53 22.59%

Accumulated 662.52 568.01 16.64%

Impairment of assets 0.00 0.00 0.00%

blocks 654.75 506.52 29.26%

Lease adjustments 0.00 0.00 0.00%

Other assets 1,952.66 1,292.35 51.09%

TOTAL ASSETS 76,085.45 78,619.73 -3.22%

Contingent liabilities 21,697.24 16,140.72 34.43%

Bills of collection 1,173.09 1,235.89 -5.08%

credit card debt

CSR ASPECT OF THE BANK

The Bank besides playing its role in economic development of

Heritage preservation is an important responsibility of every conscious individual,

In addition to this, accidental insurance cover facilitity of Bajaj Allianz General

RETAIL LOAN IN RELATION TO THE EXTANT

SCHEMES OF THE BANK

EDUCATIONAL LOAN SCHEME

1.1 Student eligibility:

Should be an Indian National

2.2 Courses eligible

Approved courses leading to graduate/ post graduate degree and P G diplomas

Graduation: For job oriented professional/ technical courses offered by reputed

Post graduation: MCA, MBA, MS, etc.

3. EXPENSES CONSIDERED FOR LOAN:

Examination/ Library/ Laboratory fee.

Insurance premium for student borrower, if applicable.

Caution deposit, Building fund/refundable deposit supported by Institution bills/receipts,

Purchase of books/ equipments/ instruments/ uniforms*.