INTRODUCTION

State Bank of Travancore (SBT), is a subsidiary of the State Bank Group and also has private share-holders. It is the premier bank of Kerala, India, where it has 700 branches. Overall, SBT has a network of over 792 branches spread over 16 Indian states. For the year ended 31 March 2011, P Pradeep Kumar, Managing Director of State Bank of Travancore, reported growth of 21% in operating profit at Rs. 1,176 crore against Rs. 972 crore in the previous year, driven by growth of 21% in Net Interest Income at Rs. 1,696 crore against Rs. 1,400 crore last year. Total income improved by 18% to Rs. 5,810 crore from Rs. 4,906 crore. Total expenditure, excluding provisions and contingencies, stood at Rs. 4634 crore against Rs. 3,934 crore with interest expenditure accounting for Rs. 3,533 crore. After taking into account additional provisions for staff, NPA and income tax, the net profit has moved up by 6% to Rs. 728 crore from Rs. 684 crore. Operating Profit for the fourth quarter was higher by 13% at Rs. 315 crore against Rs. 278 crore in the same quarter last year. Net Profit for the quarter improved to Rs. 238 crore from Rs. 217 crore. The directors declared a total dividend of Rs. 18 per share. The bank had already paid an interim dividend of Rs. 8 per share in October 2010. Earnings per share improved to Rs. 146 from Rs. 137 and the book value to Rs.641 from Rs. 532. The net interest margin has improved from 2.82 to 2.87%. Return on Assets stood at 1.1%, while Return on Equity was at 25%, which continues to be amongst the highest among Public Sector Banks. The Banks Board of Directors had earlier approved a Rights Issue of shares to the shareholders for an amount of Rs. 500 crore. The approvals from the RBI and State Bank of India for the issue have been received. The capital augmentation will serve to improve the Capital adequacy ratio of the Bank in 2011-12. The overall business of the bank registered a growth of 20% at Rs. 1,04,202 crore against Rs. 89,345 crore with Deposits accounting for Rs. 58,158 crore (Rs. 50,883 crore) and Advances Rs. 46,044 crore (Rs. 38,461 crore). Priority sector advances grew by 22 per cent to Rs. 17,353 crore from Rs. 14,260 crore. The share of Priority sector lending has moved to 44% of the Adjusted Net Bank credit, up a little from the previous year and ahead of the stipulated benchmark of 40%. Agriculture segment was the star performer during the year. The advances under this segment moved up by 70% to Rs. 5,580 crore from Rs. 3,289 crore at the end of previous year. The percentage of Gross NPAs to Gross Advances stood at 1.8% on 31st March 2011 with the Gross NPA level at Rs. 835 crore. The percentage of Net NPA to Net advances remained just below 1%. The Banks Provision Coverage Ratio stood at 69%, and is comfortably ahead of the timelines agreed with RBI to reach 70% coverage ratio by September 2011. The total CRAR position under Basel-II framework as on 31/03/2011 was 13% against a minimum of 9%

stipulated by RBI. The Tier-I CRAR as on 31/03/2011 at 9%. The Bank has further expanded its credit deployment in Kerala, particularly in Housing Loans, Car Loans and other Retail Loans. Banks CD Ratio in Kerala has improved from 59% in March 2010 to 62% in March 2011