New Union Bank of India Final - Copy

7/27/2019 New Union Bank of India Final - Copy

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Chapter 1.

Introduction


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1. OVERVIEW OF THE INDUSTRY

The Indian banking can be broadly categorized into nationalized (government owned), Private

banks and specialized banking institutions. The Reserve Bank of India acts as a centralized body

monitoring any discrepancies and shortcoming in the system. Since the nationalization of banks

in 1969, the public sector banks or the nationalized banks have acquired a place of prominence

and has since then seen tremendous progress. The unleashing of products and services through

the net has galvanized players at all levels of the banking institution market grid to look anew at

their existing portfolio offerings. Conservative banking practices allowed Indian banks to be

insulated partially from the Asian Currency crisis. Indian banks are now quoting at higher

valuation when compared to banks in other Asian countries (viz. Hong Kong, Singapore,

Philippines etc.) that have major problems linked to huge Non-performing Assets (NPAs) and

payment defaults. Co-operative banks are nimble footed in approach and armed with efficient

brand networks focus primarily on the high revenue niche retail segments.

The Indian banking has finally worked up to the competitive dynamics of the New In dian

market and is addressing the relevant issues to take on the multifarious challenges of

globalization. Banks that employ IT solutions are perceived to be futuristic and proactive

players capable of meeting the multifarious requirements of the large Customer Base. Private

Banks have been fast on the uptake and are reorienting their strategies using the internet as the

medium. The internet has emerged as the new and challenging frontier of marketing with the

convenient physical world tenets being just as applicable like in any other marketing medium.

The Indian banking has come from a long way from being a sleepy business institution to a

highly proactive and dynamic entity. This transformation has been largely brought about by the

large dose of liberalization and economic reforms that allowed banks to explore new business


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opportunities rather than generating revenues from conventional streams (i.e. borrowing and

lending). The banking in India is highly fragmented with 30 banking units contributing to almost

50% of deposits and 60% advances. Indian nationalized banks (banks owned by the government)

continue to be the major lenders in the economy due to their sheer size and penetrative networks

which assures them high deposit mobilization. The Indian banking can be broadly categorized

into nationalized, private banks and specialized banking institutions.

The Reserve Bank of India acts as a centralized body monitoring any discrepancies and

shortcoming in the system. The nationalized banks (i.e. government owned banks) continue to

dominate the Indian banking areas. Industry estimates indicate that out of 274 commercial banks

operating in India, 223 banks are in the public sector and 51 are in private sector. The private

sector bank grid also includes 24 foreign banks that have started their operations here. Under the

ambit of the nationalized banks come the specialized banking institutions. These co-operatives,

rural banks focus on areas of agriculture, rural development etc.

1.1 ECONOMIC FUNCTIONS:

The economic functions of banks include:

Issue of money, in the form of banknotes and current accounts subject to cheque or paymentat the customer's order.

netting and settlement of payments -- banks act both as collection agent and paying agentsfor the benefit of the customers, and participate in inter-bank clearing and settlement systems to

collect. This enables banks to economize on reserves held for settlement of payments, since it is

noted that inward and outward payments offset each other.

Credit intermediationbanks borrow and lend back to bank.


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Credit quality improvement -- banks lend money to ordinary commercial and personalborrowers (ordinary credit quality), but are high quality borrowers.The improvement comes from

diversification of banks assets andbanks own capital which acts as buffer. However, since

banknotes and deposits are generally unsecured in nature, if the bank gets into difficulty and

pledges assets as security to try to get the funding it needs to continue to operate, this puts the

note holders and depositors in an economically subordinated position.

Maturity transformation -- banks on the one hand borrow more on demand debt and shortterm debt, but on the other provide more long term loans. Bank can do this because they can

aggregate issues like accepting deposits and issuing banknotes and redemptions like withdrawals

and redemptions of banknotes, maintain reserves of cash, invest in marketable securities that can

be readily converted to cash if needed, and raise replacement funding as needed from various

sources such as wholesale cash markets and securities markets) because they have a high and

more well known credit quality than most other borrowers.

1.2 LAW OF BANKING:

Banking law is based on a contractual analysis of the relationship between the bank and the

customer.

The law implies rights and obligations into this relationship as follows:

The bank account balance is the financial position between the bank and the customer, whenthe account is in credit, the bank owes the balance to the customer, when the account is

overdrawn, and the customer owes the balance to the bank.

The bank pays the customer's cheques up to the amount standing to the credit of theircustomer's account and any agreed overdraft limit.


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The bank may not pay from the customer's account without permission from the customer,such as a cheque drawn by the customer.

The bank promptly collects the cheques deposited to the customer's account as the customer'sagent, and to credit the proceeds to the customer's account.

The bank has a got right to combine the customer's accounts, since each account is just anaspect of the same credit relationship.

The bank has a lien on the cheques deposited to the customer's account, to the extent that thecustomer is indebted to the bank.

The bank must not disclose the details of the transactions going through the customer's

account unless the customer consents, there is a public duty to disclose, the bank's interests

require it, or under compulsion of law.

The bank should not close a customer's account without giving reasonable notice to thecustomer, because cheques are outstanding in the ordinary course of business for several days.

These contractual terms may be modified/altered by express agreement between the customer

and the bank. The rules and regulations in force in the jurisdiction may also modify the above

terms and/or create new rights, obligations or limitations relevant to the bank-customer

relationship.

1.3 LIST OF SOME BANKS IN INDIA

Allahabad bank

Bank of Baroda

Barclays Bank

Centurion Bank

Citibank


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Corporation Bank

ICICI Bank

Indusland Bank

State Bank of India

IDBI Bank

Punjab National Bank

HDFC Bank

Canara Bank

Union Bank

The growth in the Indian Banking Industry has been more qualitative than quantitative

and it is expected to remain the same in the coming years.

Based on the projections made in the "India Vision 2020" prepared by the Planning Commission

and the Draft 12th Plan, the report forecasts that the pace of expansion in the balance-sheets of

banks is likely to decelerate. The total assets of all scheduled commercial banks by end-

March 2012 is estimated at Rs 60, 90, 000 crores. This will comprise about 65 per cent of

GDP at current market prices as compared to 67 per cent in 2002-03. Bank assets are expected to

grow at an annual composite rate of 13.4 per cent during the rest of the decade as against the

growth rate of 16.7 per cent that existed between 1994-95 and 2002-03. It is expected that there

will be large additions to the capital base and reserves on the liability side.

The Indian Banking Industry can be categorized into non-scheduled banks and scheduled banks.

Scheduled banks constitute of commercial banks and co-operative banks. There are about 67,000

branches of Scheduled banks spread across India. As far as the present scenario is concerned the

Banking Industry in India is going through a transitional phase.


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The Public Sector Banks (PSBs), which are the base of the Banking sector in India account for

more than 78 per cent of the total banking industry assets. Unfortunately they are burdened with

excessive Non Performing assets (NPAs), massive manpower and lack of modern technology.

On the other hand the Private Sector Banks are making tremendous progress. They are leaders in

Internet banking, mobile banking, phone banking, ATMs. As far as foreign banks are concerned

they are likely to succeed in the Indian banking industry.

In the Indian Banking Industry some of the Private Sector Banks operating are IDBI, ING

Vyasa Bank, SBI Commercial and International Bank Ltd, Bank of Rajasthan Ltd. and banks

from the Public Sector include Punjab National bank, Vijaya Bank, UCO Bank, Oriental Bank,

Allahabad Bank among others. ANZ Grindlays Bank, ABN-AMRO Bank, American Express

Bank Ltd, Citibank are some of the foreign banks operating in the Indian Banking Industry.

The India Industry scene has made an impressive move on during the last few decades. The

number of industries in India have increased manifold in the past few years. Though the main

occupation has been agriculture for the bulk of the Indian population, it was realized that India

would become a prosperous and a modern state with a good industrial base. Therefore different

programs were formulated and initiated to build up an adequate infrastructure for rapid

industrialization and improve the industry scene in India. .

1.4 TYPES OF BANKING:

Personal Banking: including personal finance, banking on an international arena, bankingon a priority basis.

Transaction Banking: includes management of cash, facilities related to credit availabilityand services related to trade.

Relationship services with the investors.


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Depository Services including dematerialized account openings and associated updates.

Internet Banking services: comprising of account specifications, transaction details,performance of monetary transactions, bill payment through electronic means, etc

Latest News and updates related to the market (world/national)

All the information related to the bank under the head of About Us

Specifications and online availability of loans, debit and credit cards, insurance and other

investment services (including capital market, derivative market, forex market, etc).

Small business banking: It can show us a way to improve revenue generation techniquefrom small business segment. It is true that there is a complexity of any business products,

because of which sometimes it becomes a bit tough to sell the products to both the customers and

branches. In this context, small business banking can make a difference by simplifying the

business strategies. The target ofsmall business banking is to add value and make business

banking an inherent part of the establishment.

One of the prime targets of small business banking is to earn the revenue. This revenue

generation technique can be applied through the following ways:

The most fundamental way to generate revenue is to increase the value of the small businessproduct to the client.

The branches should also be in a active position for the development of the small businesssegment.

The cognitive process to attain the interest of the customer. The other very effective strategy is to inculcate the confidence in the sales and branch stafffor selling the product segment.

Risk practice is also a useful technique to grow the business.


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Effective utilization of call center management can be a sound strategy to enhance the salesand services of the business.

One of the good strategies is to set incentive programs to persuade someone to buy. Last but not least, the simplification of the product should surely help the customers and salespeople to enhance the small business.

Small business banking can operate in a structured way if an advisory board is formed to

regulate the business strategy effectively. Regular meeting among the executive members of the

board can help to evolve new business ideas and strategies, which can be a powerful

management tool to promote the business all over.

In recent times, many reputed banks are targeting the small business market and they are trying

to innovate new ideas to serve their needs.

Establishment of community partnership can also make credit more accessible to small

businesses. Financial establishments are also trying to make small business banking a

coherent part of theirbusiness strategy. For that they are continuing to pursue small business

lending without external partners. To make small business banking a successful one, the banks

are taking part with government agencies, like community organization, national intermediaries

and other banks to make a common goal for the enhancement ofsmall business.


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Chapter2.

RESEARCH

METHODOLOGY


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2.1 SIGNIFICANCE

The purpose of the research is to discover answers to the questions through the application of

scientific procedures. The main aim of research is to find out the truth which is hidden and which

has not been discovered as yet. Though each research study has its own specific purpose, we may

think of research objectives as falling into a number of following broad categories:-

To gain familiarity with the phenomenon or to achieve new insights into it (studies with theseobjects in a view are termed as exploratory or formulative research studies).

To portray accurately the characteristics of particular individual, situation or a group (studieswith this object in view are termed as descriptive research).

Working with the organization I learned how to understand client's need in the defined sector

like banking, investments plans etc. There are different demands which are raised by differentclients for the products and to meet these demands one have to understand the client's need, their

organization structure, their existing operations and activities, scale of operations and objectives.

2.2 MANAGERIAL USEFULNESS OF THE STUDY

The projects undertaken will be adding value to the company in the following manner

i. The advisors created will be doing sales of their services which in turn will bringgoodwill for the company

ii. The advisors created will further make some more advisors among there social groupsthereby expanding the network of advisors.

iii.

The expanding the product knowledge to there immediate social group there bycreating the awareness for the company product and its name.

Since the company has huge product portfolio there are high chances of making sales since the

products serving different needs of the customers are already available.

2.3 OBJECTIVES

To study the services provided by Union Bank of India. To study the Customer Satisfaction on the services provided by UBI. To compare services provided by UBI with other banks. To study the future prospects of growth in UBI.


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2.4 SCOPE OF THE STUDY

Analyzing the potential of ATM & Bank lobby as a captive market for promotion of NonBranch Delivery products.

Accepting Feedback from the customers regarding different products and services & alsogiving them information of the newly launched products & services.

2.5 METHODOLOGY

Research Methodology is a way to systematically solve the research problem. It may beunderstood as a science of how research is done scientifically. Under it we study the various

steps that are generally adopted by a researcher in studying his research problem along with the

logic behind them. It is necessary for the researcher to know not only the research methods/

techniques but also the methodology. In common parlance it refers to search of knowledge.

According to the advanced learner Dictionary of Current English lays down the meaning of

research as a careful investigation or inquiry especially through search for new facts in anybranch of knowledge. Reman and Mory defines Research as a Systematized effort to gain new

knowledge. Research is, thus an original contribution to the existing stock of knowledge

making for its advancement. It is the pursuit of truth with the help of study. As such the termResearch refers to the systematic method consisting of enunciating the problem, formulating a

hypothesis, collecting the facts or data, analyzing the facts and reaching certain conclusion either

in the form of solution towards the concerned problem or in certain generalization for some

theoretical formulation.

METHODS OF DATA COLLECTION

The Data is collected through two ways:

a) Primary DataIt is obtained by design to fulfill the data are original in character and are also

generated in a large number of surveys conducted mostly by government and also by institution

and research bodies. The method of collecting primary data are Observation method, Interviewmethod, and through Questionnaires etc. My mode of collecting primary data is through

questionnaires. A Questionnaire is a very effective method of collecting primary data because

with the help of questionnaires we can know about the views of customers.

b) Secondary Data These are not originally collected rather obtained from Published andUnpublished Sources. The methods of collecting Secondary Data are Magazines, Newspaper,

Journal and Internet etc.


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2.6 SAMPLE DESIGN

When secondary data are not available for the problem under study, a decision may be taken to

collect primary data by using any of the methods. The required information can be either census

method or sample method.

Census or Complete Enumeration Survey Method, data are collected for each and every unit

(person, household, shop etc.) as the case may be of population or universe which is thecomplete set of items which are of interest in any particular situation. This method is not

popularly used in practice. The effort, money and time required for carrying out complete

enumeration will generally very large.

Sampling is simply the process of learning about the population on the basis of a sample drawn

from it. Thus, in the sampling technique instead of every unit of the universe only a part of the

universe is studied and the conclusions are drawn on that basis for the entire universe. A sampleis a subset of population units. The process of sampling involves three elements:

1. Selecting the sample,2. Collecting the information and3. Making the inference about the population.

Various methods of Sampling:

A. Non- Probability Sampling Methods:

1) Judgment Sampling In this method of sampling the choice of sample items depends

exclusively on the judgment of the investigator.

2) Quota SamplingIt is the most common method of sampling. In this quotas are set upaccording to some specified characteristics such as so many in each of several income

groups, so any in each ago, so many with certain political and so on.

3) Convenience Sampling It is obtained by selecting convenient population units. The

method of convenience sampling is also known as Chunk method. Convenience samples

are prone to bias by their very nature selecting population elements, which are the

convenient to choose, almost always make them special or different from the best of theelements in the population in some way.

B. Probability Sampling Methods:

1. Simple or Unrestricted Method It refers to that sampling technique in which each andevery unit of population has an equal opportunity of being selected in the sample. Forexample: Lottery Method.


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C. Restricted Sampling Methods

1. Stratified Sampling: It is the one of the random method, which by using the availableinformation concerning the population, attempts to design a more efficient sample than

obtained by the simple random procedure.

2. Systematic Sampling: selecting one unit at random and then selecting additional units atevenly spaced intervals until the sample has been formed form it.

3. Multi-Stage or Cluster Sampling: In this method the random selection is made ofprimary, intermediate and final units from a given population.

The sources of collection of secondary data are:

Questionnaire Books Websites Magazine Brochure

2.7 QUESTIONNAIRE DESIGN / FORMULATION:

Questionnaires: - A questionnaire consists of a set of questions presented to respondent for their

answers. It can be Closed Ended of Open Ended

Open Ended: - Allows respondents to answer in their own words & are difficult to Interpret and

Tabulate.Close Ended: - Pre-specify all the possible answers & are easy to Interpret and Tabulate.

Types of question included:

i) Dichotomous Questions :-

Which has only two answers Yes or No.

ii) Multiple choice questions :-

Where respondent is offered more than two choices.

Importance scale:-

A scale that rates the importance of some attribute.Rating scale:-

A scale that rates some attribute from highly satisfied to highly unsatisfied and veryinefficient to very efficient


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2.8 SAMPLE SIZE

Size of sample means the number of sampling units selected from the population for the

investigation. Sample size should neither be too small nor too large. It should be optimum.

Optimum Size, according to Pattern, is one that fulfills the requirements of efficiency, reliability,

representatives and flexibility.

Method of Sampling used in this Project

In this project I have used the method of Convenience Sampling. It is obtained by selecting

convenient population units. The method of convenience sampling is also known as ChunkMethod. Convenience Samples are prone to bias by their very nature selecting population

elements, which are the convenient to choose, almost always make them special or different from

the best of the elements in the population in some way. I have to submit the project report on

Banking Sector and on the basis of convenience I have chosen Union Bank of India because it isnear to our house.

Sample Size in This Project

In this project I have taken the Sample Size as 25 Respondents or customers of the Bank through

which I got the primary data of my project.

2.9 LIMITATIONS OF THE RESEARCH

1.

In case of Primary data, sometimes it was difficult to contact or meet the clients, becauseof their work schedules and personal reasons.2. The opinions of the clients could have been biased against some personal preferences and

which would have led to unjustified responses.

3. Personally contacting the clients involved time and cost.4. It was difficult to find information that exactly fitted the needs of the project at hand in

case of secondary data or information is concerned.

5. Secondary data when collected was invaluable but due to passage of time and with manydynamic changes taking place in the markets, the information losses its value in thecurrent scenario.

6. The study is based on limited sample size, which is only 25.7.

Period of study is too short to draw generalizations.8. The study is organization specific.

9. Large amount of Identity proof pose as a hindrance.10.Data is reliable to a certain period only after that it becomes non reliable.


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Chapter 3.

Profile of the Organization


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3. Profile of the Organisation

The dawn of twentieth century witnesses the birth of a banking enterprise par excellence-

UNION BANK OF INDIA- that was flagged off by none other than the Father of the Nation,

Mahatma Gandhi. Since that the golden moment, Union Bank of India has this far unflinchingly

traveled the arduous road to successful banking........ A journey that spans 88 years. Union Bank

of India, reiterate the objective of our inception to the profound thoughts of the great Mahatma...

"We should have the ability to carry on a big bank, to manage efficiently crores of rupees

in the course of our national activities. Though we have not many banks among us, it does

not follow that we are not capable of efficiently managing crores and tens of crores of

rupees."

Union Bank of India is firmly committed to consolidating and maintaining its identity as a

leading, innovative commercial Bank, with a proactive approach to the changing needs of the

society. This has resulted in a wide gamut of products and services, made available to its

valuable clientele in catering to the smallest of their needs. Today, with its efficient, value-added

services, sustained growth, consistent profitability and development of new technologies, Union

Bank has ensured complete customer delight, living up to its image of, GOOD PEOPLE TO

BANK WITH. Anticipative banking- the ability to gauge the customer's needs well ahead of

real-time - forms the vital ingredient in value-based services to effectively reduce the gap

between expectations and deliverables.

The key to the success of any organization lie with its people. No wonder, Union Bank's unique

family of about 26,000 qualified / skilled employees is and ever will be dedicated and delighted

to serve the discerning customer with professionalism and wholeheartedness.


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Union Bank is a Public Sector Unit with 55.43% Share Capital held by the Government of India.

The Bank came out with its Initial Public Offer (IPO) in August 20, 2002 and Follow on Public

Offer in February 2006. Presently 44.57 % of Share Capital is presently held by Institutions,

Individuals and Others.

Over the years, the Bank has earned the reputation of being a techno-savvy and is a front runner

among public sector banks in modern-day banking trends. It is one of the pioneer public sector

banks, which launched Core Banking Solution in 2002. Under this solution umbrella, All

Branches of the Bank have been 1135 networked ATMs, with online telebanking facility made

available to all its Core Banking Customers - individual as well as corporate. In addition to this,

the versatile Internet Banking provides extensive information pertaining to accounts and facets of

banking. Regular banking services apart, the customer can also avail of a variety of other value-

added services like Cash Management Service, Insurance, Mutual Funds and Demat.

The Bank will ever strive in its endeavor to provide services to its customer and enhance its

businesses thereby fulfilling its vision of becoming THE BANK OF FIRST CHOICE IN

OUR CHOSEN AREA BY BUILDING BENEFICIAL AND LASTING RELATIONSHIP

WITH CUSTOMERS THROUGH A PROCESS OF CONTINUOUS IMPROVEMENT.


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3.1 BusinessDescription

Union bank of India (BSE: 532174), a public sector bank, is the most modern among public

sector banks (the first large Public Sector Bank in the country to have achieved 100% core

banking solution (CBS) roll out). It is also the sixth largest among public bank with an asset base

of Rs. 1,610 billion as on 31st March 2009 and is based in western India. Union Bank of India

(UBI) is one ofIndia's largest state-run banks and is also listed on the Forbes 2000. It has assets

of USD 13.45 billion. Because of its acronym UBI, the public sometimes confuses it with United

Bank of India.

The Union Bank of India has 2261 branches out which 1031 branches are under CBS. Presently

939 ATMs spread out across India both Onsite and Offsite. All the ATMs are inter-connected

through the Banks ATM Switch, thus facilitating on-line operations in case of CBS customers.
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The Bank is a member of Cash Tree consortium and also has bilateral arrangement with State

Bank of India, enabling the Banks ATM cardholder access to over 20000 ATMs across the

country. UBI Net connects 65 Offices and 984 branches located in 323 centers, facilitating

speedier transmission of MIS data (Network Map). The network also facilitates the

implementation of Core Banking Solution, apart from DEMAT services, Cash Management

services, fund transfers, messaging system, etc.The Bank is using VSAT network for connecting

branches and ATMs wherever leased line connectivity is not feasible. We have 590 VSATs

operational, connecting 194 branches/extension counters and 316 ATMs.

From 2006 to 2009, the bank managed to open an additional 500 branches, far outpacing the 72

branches opened from 1996 to 2006. In FY 09, the Bank began offering anywhere banking

services to all of its branches, also known as core banking solutions (CBS). With 100% CBS

branches, the Bank managed to increase its total business (sum of deposits and advances) by

31.84%, to reach Rs. 2,390 billion compared to Rs. 1,797 billion in FY08. The bank had net

interest margin of 3.24% which is 39 bps higher than its peers average, aided by lowest cost of

funds in the industry at 6.35%. With the continuous competition from private and other PSU

Banks, Union Bank of India has been focusing on increasing other income streams like

Insurance, Mutual Fund and wealth management services.

The Company's principal activity is to provide commercial banking services. It provides

merchant banking, direct finance, infrastructure finance, venture capital fund, advisory,

trusteeship, forex, treasury and other related financial services. The Company operates through

2361 branches including 136 extension counters in India.

During FY09, the Bank enhanced its profitability by focusing on high yielding loan portfolio -

retail, MSME (Medium, Small and Micro Enterprises) and agriculture credit, and reduced its


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exposure on low yielding advances. As a result, its return on assets stood at 1.27% which was

well above its peers average of 1.10% as on 31st March 2009. Similarly, return on equity stood

at 24.79% against its peers average of 22.04%.

3.2CORPORATEMISSION

A logical extension of the Vision Statement is the Mission of the Bank, which is to gainmarket recognition in the chosen areas.

To build a sizeable market shares in each of the chosen areas of business througheffective strategies in terms of pricing, product packaging and promoting the product in the

market.

To facilitate a process of restructuring of branches to support a greater efficiency in theretail banking field.

To sustain the mission objective through harnessing technology driven banking anddelivery channels.

To promote confidence and commitment among the staff members, to address theexpectations of the customers efficiently and handle technology banking with ease.

3.3 Union Bank of India Training System

Seldom has there been a time in which it has been necessary for Organizations to attune

Attitudes, upgrade Skills and kindle sparks of Knowledge in their human force to the extent and

with the rapidity required today.

Those who dominate the market in times to come will be those who are prepared to seize

opportunities as they come.


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At Union Bank, the training facilities offer an admirable approach to these opportunities.

Askand it shall be Given.

TO BE THE BEST COME TO THE BEST

Union bank has one of the best training systems in India. The training experience here goes back

to over four decades. Presently the training structure consists of the Staff College at Bangalore,

and seven centers in various parts of the country. The training is designed, delivered and

assessed, based on systems suggested and put in place by our overseas consultants M/s. Vinstar

Limited (AGL Group) of New Zealand. These systems have been tested and refined by practical

application.

The training system of Union Bank has been awarded the prestigious Golden Peacock National

Training Award instituted by the Institute of Directors, New Delhi for the best training system in

the Country.

In our pursuit of achieving higher standards we have further upgraded our systems and sized up

to 'international norms'. After a rigorous audit, in February 2001, the College is awarded ISO

9001 certification (for Design and Development of Customized Training Programs) by Det

Norske Veritas, of the Netherlands. We are the only Bank to obtain ISO certification for the

training system.

THE COLLEGE - AMBIENCE FOR LEARNING

Union Bank Staff College stretching over 36 acres of sylvan setting, on the out skirts of

Bangalore city, has been the cynosure of appreciation as an apt option, for the best ambience for

learning. Here physical, mental, spiritual and social up gradation of self for an individual and

building of teams of performers of outstanding Organizations take place in the most natural way.

We have got excellent, air-conditioned learning centers [we call them "channels" of learning],


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computer-backed presentation packages, interactive learning processes, salubrious living

conditions in hostel rooms with provisions for intellectual and physical games, group exercises

and teambuilding fun in verdurous mango-groves, where mimicking monkeys and shy sheep are,

perhaps, the only onlookers! Yoga, somnolent reverie after a relaxed splash in the swimming

pool, or a stroll down the jogging tracks and exercise stations or a stretch of paddling or rowing

on the boat around the natural pond are true tonics for invigoration. If the weather does not

encourage outdoor relaxation (unusual in the 'Garden City' of Bangalore!) a workout in the

luxury of the Gymnasium, a game of snooker, a solitary tryst with computer games or online

learning facilities - are other options.

3.4 PRODUCTS AND SERVICES

1. Union Bank of India Credit CardsUnion Bank of India has three International Credit Cards designed to meet your unique lifestyle

and shopping needs. Bank has three types of credit cards-Union card- Classic, Silver and Gold.

The bank offers various features and benefits on its cards including Cash Advance round the

clock at all ATMs, Photo card option, Accident Insurance, Reward Program, Flexi payment, etc.

2. Union Bank of India International Debit CardATM SERVICES

A T M (Automated Teller Machine) facilitates the customer to do Banking transactions such as

Cash withdrawal, balance enquiry, obtaining mini-statement, transfer of funds between his/her

own accounts etc. Union Bank of India tied up with Visa for issuing International Debit Cards to

the customers of all its branches. The Debit Card provides ANY TIME / ANY WHERE

Banking to the customers. Presently, Bank has 1276 ATMs (As on 30.06.2008) which are on-

line, conveniently located and spread across the country. The Debit Card can also be used for


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In the USA, all Remittances over USD 1000 are FREE. In the UK, all Remittances over GBP

2500 are FREE.

7. Union Bank of India BULLETFund Transfer never made so easy. Under REAL TIME GROSS SETTLEMENT (RTGS) we

ensure the fastest, efficient and secure mode of fund transfer without making the Demand Draft.

You can avail this facility through our Union Bullet. Quick, hassle-free RTGS transfer to any

RTGS registered branch. Convenient, Paperless, Multi City and Multi Branch Banking. For

further details please contact the nearest branch.

8.

Union Bank of India Life Guard

Health is very important and medical expenses are soaring to new heights. It is essential for

individuals to make some provision for health care for all members of your family. Union Bank

has various initiatives to care for your money and also your life. Now you need not worry about

unforeseen medical hospitalization expenses. Our Union Life Guard provides cashless/ hassle

free hospitalization. "Union Life Guard" facilitates instant admission in all participating

hospitals. You can repay the amount in just 36 installments.

9. Union Bank of India Union DIAL24Hour Customer Care

Union is at your service 24*7*365. Customers in India can reach the call Centre through an All-

India Toll Free number 1800 22 22 44 and customers abroad can reach us through +91-22-

25719600. Presently Bank is starting this service in English and Hindi only.

10. Union Bank of India LoansThe various types of loans provided by the Union Bank of India are:

1. Home loan


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2. Personal loan

3. Educational loan

4. Car loan

11. Union Bank of India Savings Account

Union Bank of India has three types of saving account- multi gains savings account, no frills

savings account and union super salary account. Bank has categorized the savings account

keeping in mind needs of different people. The multi gain savings account is basically a general

savings account in which one has to maintain a minimum balance of Rs 25000/-.

12. Union Bank of India Fixed Deposit

Union Bank of India Union Cumulative Deposit Scheme has been designed for household saving

plan for small investors. Account can be opened with a minimum amount of Rs 50/-. Interest is

compounded annually.

3.5 FUTURE PLANS OF THE ORGANISATION

Mumbai, Oct. 25 Union Bank of Indias net profit surged by 31.16 per cent to Rs 362 crore for

the quarter ended September 30, aided by a 49 per cent increase in its net interest income.

However, the banks non-interest income declined marginally due a loss in investments to the

tune of Rs 38 crore.

This was a difficult quarter. Despite the rising cost of resources, the banks net interest margin

increased to 3.01 per cent, up 52 basis points, from 2.47 per cent in the year ago period, said Mr

M.V. Nair, Chairman and Managing Director, Union Bank of India.

While the banks cost of deposits fell to 6.25 per cent (6.41), the yield on advan ces increased to

11.16 per cent (10.26).


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The banks net NPAs also declined by 51 basis points to 0.14 per cent, indicating a significant

improvement in asset quality, he said. Asked of the possibility of an increase in delinquencies in

the third quarter, Mr Nair said the bank has been performing stress tests on its assets on a regular

basis and most of the accounts are performing well.

The delinquencies have come down in the retail, SME and agricultural sectors.

A also improved by 60 basis points from 32.5 per cent to 33.1 per cent for the quarter under

review.

The bank aims to grow its total balance sheet size by 22 per cent to Rs 2,20,000 crore by the end

of this fiscal, Mr Nair said while elaborating the banks future plans.

For this, the bank is targeting a 23 per cent deposit growth and 22 per cent advances growth.

The bank would focus on increasing its non-interest income and containment of the cost of

funds. Retail, agri business, SME and corporates will be the four growth engines, he added.

On Friday, the shares of the bank fell to Rs 123.25, against the previous close of Rs 139.55.


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ORGANIZATIONAL CHART


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3.6 PROBLEMS OF THE ORGANISATION

The most severe problem faced by the branches of Union Bank of India are:

1. Negative environment.

2.Banks are being hit hard on all sides. Competitive challenges are not the only threat, however,

structural and technology challenges are radically changing the game too, with the euro and Y2K

just being some key examples.

3.For those in retail financial services the next five years are likely to prove the most dynamic

the industry has ever seen but they could also be some of the most destructive.

4.Retail commercial banks worldwide face a revolution not only in how financial services can be

delivered but also in customer expectations.

5.Deregulation and new technology have allowed aggressive new entrants into the banks' cosy

world and unless the banks can dramatically change their traditional attitudes towards .

3.7 S.W.O.T. ANALYSIS

STRENGTHS

Dedicated relationship manager Relatively low eligibility balance Priority loungeWEAKNESSES

Lack of Promotional Activities Relatively Less Services HoursOPPORTUNITIES

Rapid Expansion of Dwarka Residential Society


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School, College Students Parents CorporateTHREATS

Increased Competition

3.8 COMPETITORS INFORMATION

1. Canara Bank

Canara Bank has a can-do attitude about banking in India. One of India's largest banks, Canara

Bank (also known as CanBank) has a network of more than 2,500 branches throughout India and

branches in Hong Kong and London. All of Canara Bank's branches -- including those located in

rural areas -- are computerized, in a country where it is not a given that banks can make such a

claim. (The bank considers 30% of its branches to be located in rural areas.) The modernization

of all branches allows the bank to offer its customers networked ATMs, telebanking, internet

banking, and debit card services. Other services include asset management and factoring. The

financial institution is 73% owned by India's government.

2. ICICI BANK

ICICI Bank is India's #2 bank (after State Bank of India), with some 950 branches and 3,300

ATMs nationwide. It also has locations in nearly 20 other countries. ICICI's retail banking group

offers lending and deposit services to small businesses and individuals. Larger businesses are

served by the corporate banking group, which offers finance services and treasury products.

ICICI's rural and government banking unit offers micro-loans and agricultural banking. Foreign
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operations, as well as services related to international trade finance and expatriate Indians, fall

under the international banking group. Other ICICI offerings include online banking, asset

management, and insurance.

3. State Bank of India

State Bank of India is the nation's largest bank. Tracing its roots back some 200 years to the

British East India Company (and initially established as the Bank of Calcutta in 1806), the bank

operates more than 14,000 branches within India, where it also owns majority stakes in seven

associate banks. State Bank of India has more than 50 offices in nearly 35 other countries,

including multiple locations in the US, Canada, and Nigeria. The bank has other units devoted to

capital markets, fund management, factoring and commercial services, and brokerage services.

The Reserve Bank of India owns about 60% of State Bank of India.

4. Punjab National Bank

With over 56 million satisfied customers and 5002 offices including 5 overseas branches, PNB

has continued to retain its leadership position amongst the nationalized banks. The bank enjoys

strong fundamentals, large franchise value and good brand image. Besides being ranked as one

of India's top service brands, PNB has remained fully committed to its guiding principles of

sound and prudent banking. Apart from offering banking products, the bank has also entered the

credit card, debit card; bullion business; life and non-life insurance; Gold coins & asset

management business, etc.
http://stockmarkettoday.in/wp-content/uploads/2009/09/pnb_logo.gif


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5. Bank of Baroda

Bank of Baroda believes in the strength and integrity of relationships built with its customers

like you. With over 102 years of experience in the banking industry and a wide network of over

3237 branches (including 26 extension counters) all over the country, we have always been

active in extending financial support and adapting to your changing needs.

Our Deposit Products, Retail Loans, Credit Cards and Debit Cards help you with your

growing financial needs. With facilities likeLockerswe ensure that your valuables are safe with

us.

Our countrywide branches offer you convenience and ease in operating your account wherever

you are. Our 24-hour ATMs enable you to withdraw cash, check your account balance and

request for a new chequebook even after banking hours.

6. Indian Bank

A premier bank owned by the Government of India

Established on 15th August 1907 as part of the Swadeshi movement

Serving the nation with a team of over 19000 dedicated staff

Total Business crossed Rs.1,67,980 Crores as on 30.09.2010

Operating Profit increased to Rs. 2747.35 Crores as on 31.03.2010

Net Profit increased to Rs.1554.99 Crores as on 31.03.2010

Core Banking Solution(CBS) in all 1801 branches
http://www.bankofbaroda.com/branchlocator.asphttp://www.bankofbaroda.com/branchlocator.asphttp://www.bankofbaroda.com/pfs/deposits.asphttp://www.bankofbaroda.com/pfs/deposits.asphttp://www.bankofbaroda.com/pfs/retailloans.asphttp://www.bankofbaroda.com/pfs/retailloans.asphttp://www.bobcards.com/http://www.bobcards.com/http://www.bankofbaroda.com/pfs/atm_debitcards.asphttp://www.bankofbaroda.com/pfs/atm_debitcards.asphttp://www.bankofbaroda.com/pfs/lockers.asphttp://www.bankofbaroda.com/pfs/lockers.asphttp://www.bankofbaroda.com/pfs/lockers.asphttp://burnyourfuel.com/My_Files/Other/indian-bank-logo.jpghttp://www.bankofbaroda.com/pfs/lockers.asphttp://www.bankofbaroda.com/pfs/atm_debitcards.asphttp://www.bobcards.com/http://www.bankofbaroda.com/pfs/retailloans.asphttp://www.bankofbaroda.com/pfs/deposits.asphttp://www.bankofbaroda.com/branchlocator.asphttp://www.bankthailand.info/images/Baroda-logo.gif


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This Code for Collection of Dues And Repossession of Security (CDRS Code), is a non-statutory

code issued on voluntary basis.

II. Applicability:

This code will apply to Union Bank Of India from 19th January 2004.

III. Contents:

Introduction

Dues Collection Policy Statement

Security Repossession Policy Statement

General Guidelines

Grievance Redressed

1. Introduction:

Union Bank Of India is committed to:

Following fair practices especially with regard to collection of dues and repossession of

security

Fostering customer confidence and long-term relationship.

2. Dues Collection Policy Statement:

Dignity and Respect to Customers is Union Bank of India's Debt Collection Policy and

the Bank do not follow policies that are unduly coercive in collection of dues.

Union Bank of India's dues collection policy is built on courtesy, fair treatment and

persuasion.

3. Security Repossession Policy Statement:

Union Bank of India's Security Repossession Policy aims at recovery of dues in the event

of default and is not aimed at whimsical deprivation of the property.


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The Policy recognizes fairness and transparency in repossession, valuation and

realization of security.

4. Guidelines:

All the members of the staff or any other person authorized to represent Union

Bank of India in dues collection or/and security repossession would follow the guidelines set out

below:

General:Before taking action for collection of dues and repossession of security, Bank would give notice

to the Borrower asking him to repay the dues and the Borrower will be generally given minimum

15 days time to repay dues.

Guidelines for Collection of dues: Customer would be contacted ordinarily at the place of his choice and in the absence of

any specified place, at the place of his residence in the case of retail customers and in the place

of business or residence as the case may be in the case of other customers.

Identity and authority to represent would be made known to the customer at the first

instance.

Customer privacy would be respected.

Interaction with the customer would be inacceptable business language.

Customer calling time would be between 0700 and 1900 hours unless the special

circumstances of the borrower's business or occupation demand otherwise.

Customer requests to avoid call at a particular time or at a particular place would be

honored as far as possible.

Time and number of calls and contents of conversion would be documented.


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Customer would be provided with all the information regarding dues at the time of notice

of recall of loan and as and when demanded by the Customer.

All assistance would be given to resolve disputes or differences in a mutually acceptable

and in an ordinary manner, if any as regards dues.

During visits to customers' place for dues collection, decency and decorum would be

maintained.

Inappropriate occasions such as bereavement in the family or such other calamitous

occasions would be avoided for making calls/visits to collect dues.

Demeanor that would suggest criminal intimidation or threat of violence would be

scrupulously avoided.

Guidelines for Repossession of Securities: Due process of Law would be followed for repossession of securities

Bank would give one week's notice before taking possession of/seizing securities

In case Bank engages services of a Recovery/Seizure Agent for repossession of securities

then a notice of such appointment will be given to the Borrower.

Identity of Recovery/Seizure Agent so appointed will be disclosed to you

Such Recovery/Seizure Agents will have a covenant with the Bank to be bound by this

Code.

Any violation of Code by Recovery/Agent will be viewed seriously and the Bank will

take prompt action in preventing the violation.

Bank would an approved value the securities and ascertain fair market value before

resorting to sale.


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Ordinarily Bank would not sell the securities below the fair market value unless the

circumstances warrant. In the event of sale of securities being done at a price below the fair

market value then Borrower would be given one opportunity to arrange for bidders at or above

the fair market value.

Sale of securities will be conducted only after expiry of 30 days from the date of notice of

sale.

In case the borrower comes forward and reaches a settlement and repays the dues of the

Bank, then repossessed securities will be returned within 10 days from the date of satisfaction of

dues.


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Chapter4.

Risk Management


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Risk Management

Risk is inherent part of Banks business. Effective Risk Management is critical to any Bank for

achieving financial soundness. In view of this, aligning Risk Management to Banks

organizational structure and business strategy has become integral in banking business. Over a

period of year, Union Bank of India (UBI) has taken various initiatives for strengthening risk

management practices. Bank has an integrated approach for management of risk and in tune with

this, formulated policy documents taking into account the business requirements / best

international practices or as per the guidelines of the national supervisor. These policies address

the different risk classes viz., Credit Risk, Market Risk and Operational Risk.

The issues related to Credit Risk are addressed in the Policies stated below;

Loan Policy. Credit Monitoring Policy. Real Estate Policy. Credit Risk Management Policy. Collateral Risk Management Policy. Recovery Policy. Treasury Policy.The Policies and procedures for Market Risks are articulated in the ALM Policy and Treasury

Policy.

The Operational Risk Management involves framework for management of operational risks

faced by the Bank. The issues related to this risk is addressed by;

Operational Risk Management Policy. Business Continuity Policy.


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Outsourcing Policy. Disclosure Policy.Besides, the above Board mandated Policies, Bank has detailed Internal Control Principles

communicated to the business lines for ensuring adherence to various norms like Anti-Money

Laundering, Information Security, Customer complaints, Reconciliation of accounts, Book-

keeping etc.

Credit Risk Credit Risk Management Policy of the Bank dictates the Credit Risk Strategy. These Polices spell out the target markets, risk acceptance / avoidance levels, risktolerance limits, preferred levels of diversification and concentration, credit risk measurement,

monitoring and controlling mechanisms.

Standardized Credit Approval Process with well-established methods of appraisal andrating is the pivot of the credit management of the bank.

Bank has comprehensive credit rating / scoring models being applied in the spheres ofretail and non-retail portfolios of the bank.

The Credit rating system of the Bank has eight borrower grades for standard accounts andthree grades for defaulted borrowers.

Proactive credit risk management practices in the form of studies of rating-wisedistribution, rating migration, probability of defaults of borrowers, Portfolio Analysis of retail

lending assets, periodic industry review, Review of Country, Currency, Counter-party and Group

exposures are only some of the prudent measures, the bank is engaged in mitigating risk

exposures.


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The current focus is on augmenting the banks abilities to quantify risk in a consistent,reliable and valid fashion, which will ensure advanced level of sophistication in the Credit Risk

Measurement and Management in the years ahead.

Market Risk Bank has well-established framework for Market Risk management with the AssetLiability Management Policy and the Treasury Policy forming the fulcrum for procedures,

processes and structure. It has a major objective of protecting the banks net interest income in

the short run and market value of the equity in the long run for enhancing shareholders wealth.

The important aspect of the Market Risk includes liquidity management, interest rate risk

management and the pricing of assets and liabilities. Further, Bank views the Asset Liability

Management exercise as the total balance sheet management with regard to its size, quality and

risk.

The ALCO is primarily entrusted with the task of market risk management. TheCommittee decides on product pricing, mix of assets and liabilities, stipulates liquidity and

interest rate risk limits, monitors them, articulates Banks interest rate view and determines the

business strategy of the Bank.

Bank has put in place a structured ALM system with 100% coverage of data on bothassets and liabilities. To measure liquidity and interest rate risk, Bank prepares various reports

such as Structural Liquidity, Interest Rate Sensitivity, Fortnightly Dynamic Statement etc.

Besides RBI reporting many meaningful analytical reports such as Duration Gap analysis,

Contingency Funding Plan, Contractual Maturity report etc. are generated at periodic intervals

for ALCO, which meets regularly. Statistical and mathematical models are used to analyze the

core and volatile components of assets and liabilities.


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The objective of liquidity management is to ensure adequate liquidity without affectingthe profitability. In tune with this, Bank ensures adequate liquidity at all times through

systematic funds planning, maintenance of liquid investments and focusing on more stable

funding sources.

The Mid Office group positioned in treasury with independent reporting structure on riskaspects ensure compliance in terms of exposure analysis, limits fixed and calculation of risk

sensitive parameters like VaR, PV01, Duration, Defeasance Period etc. and their analysis.

Operational Risk

Operational Risk, which is intrinsic to the bank in all its material products, activities,

processes and systems, is emerging as an important component of the enterprise-wide risk

management system. Recognizing the importance of Operational Risk Management, Bank has

adopted a Comprehensive Operational Risk Management Policy. This would entail the bank to

move towards enhanced level of sophistication in the years ahead and to capture qualitative and

quantitative measures of Operational Risk indicators in management of operational risk.

Bank has comprehensive system of internal controls, systems and procedures to monitorand mitigate risk. Bank has also institutionalized new product approval process to identify the

risk inherent in the new product and activities.

The Internal audit function of the Bank and the Risk Based Internal Audit, complimentsthebanks ability to control and mitigate risk.

4.1 COMPENSATION POLICY

Technological progress in payment and settlement systems and the qualitative changes in

operational systems and processes that have been undertaken by various players in the market

have enabled market forces of competition to come into play to improve efficiencies in providing


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better service to the users of the system. It will be the banks endeavor to offer services to its

customers with best possible utilization of its technology infrastructure. Withdrawal of the

Reserve Bank of India instructions to banks on time frame for collection of outstation cheques,

payment of interest on delayed collection of outstation cheques/instruments, with effect from 1st

November 2004, had offered bank further opportunities to increase its efficiency for better

performance. This Compensation policy of the bank is therefore, designed to cover areas relating

to unauthorized debiting of account, payment of interest to customers for delayed collection of

cheques/instruments, payment of cheques after acknowledgement of stop payment instructions,

remittances within India, foreign exchange services, lending, etc. The policy is based on

principles of transparency and fairness in the treatment of customers.

The objective of this policy is to establish a system whereby the bank compensates the customer

for any financial loss he/she might incur due to deficiency in service on the part of the bank or

any act of omission or commission directly attributable to the bank. By ensuring that the

customer is compensated without having to ask for it, the bank expects instances when the

customer has to approach Banking Ombudsman or any other Forum for redressed to come down

significantly.

It is reiterated that the policy covers only compensation for financial losses which customers

might incur due to deficiency in the services offered by the bank which can be measured directly

and as such the commitments under this policy are without prejudice to any right the bank will

have in defending its position before any forum duly constituted to adjudicate banker-customer

disputes.


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2. ECS direct debits/other debits to accounts

The bank will undertake to carry out direct debit/ ECS debit instructions of customers in time. In

the event the bank fails to meet such commitments interest at the prevailing rate applicable for

fixed deposit of 1 to 3 years will be paid for the period of delay to compensate financial loss the

customer would incur on account of delay in carrying out the instruction/failure to carry our the

instructions. No other financial loss will be compensated.

The bank would debit the customers account with any applicable service charge as per the

schedule of charges notified by the bank. In the event the bank levies any charge in violation of

the arrangement, the bank will reverse the charges when pointed out by the customer subject to

scrutiny of agreed terms and conditions. In such cases interest will be paid at the prevailing rate

applicable for fixed deposit of 1 to 3 years for the relevant period so as to compensate any

consequential financial loss to the customer. No other financial loss will be compensated.

Where it is established that the bank had issued and activated a credit card without written

consent of the recipient, the bank would not only reverse the charges immediately but also pay a

penalty without demur to the recipient amounting to twice the value of charges reversed.

3. Payment of Cheques after Stop Payment Instructions

In case a cheque has been paid after stop payment instruction is acknowledged by the bank, the

bank shall reverse the transaction. Such debits will be reversed within 2 working days of the

customer intimating the transaction to the bank. Any consequential financial loss to the customer

will be compensated as provided under Para 1 above.


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4. Foreign Exchange Services

The Bank would not compensate the customer for delays in collection of cheques designated in

foreign currencies sent to foreign countries, as the bank would not be able to ensure timely credit

from overseas banks. It is the banks experience that time for collection of instruments drawn on

banks in foreign countries differ from country to country and even within a country, from place

to place. The time norms for return of instruments cleared provisionally also vary from country

to country. Bank however, would consider upfront credit against such instrument by purchasing

the cheque/instrument, provided the conduct of the account has been satisfactory in the past.

However, the bank will compensate the customer for undue delays in affording credit once

proceeds are credited to the Nostro Account of the bank with its correspondent. Such

compensation will be given for delays beyond one week from the date of credit to Nostro

Account/ due date after taking into account normal cooling period stipulated. The compensation

in such cases will be worked out as follows:

a) Interest for the delay in crediting proceeds as indicated in the collection policy of the

bank

b) Compensation for any possible loss on account of adverse movement in foreign exchange

rate. The compensation will be the difference between the RBI reference rate between the dates

the credit should have been passed on to the customer and the date the credit is actually passed

on.

5. Remittances in India

The compensation on account of delays in collection of instruments would be as indicated in the

banks collection policy, which is reproduced below for information:


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Payment of Interest for delayed Collection of Outstation Cheques -

As part of the compensation policy of the bank, the bank will pay interest to its customer on the

amount of collection instruments in case there is delay in giving credit beyond the time period

mentioned above. Such interest shall be paid without any demand from customers in all types of

accounts. There shall be no distinction between instruments drawn on the banks own branches

or on other banks for the purpose of payment of interest on delayed collection.

Interest for delayed collection shall be paid at the following rates -

a) Fixed deposit rate prevailing at the time of payment of interest for the period of delay

beyond 7/10/14 days as the case may be in collection of outstation cheques.e.g. If a cheque

payable at Chennai is deposited at Mumbai on 1st

January 2007 and credited to the customers

account on 11th

January 2007, the actual period of delay will be 3 days. Interest will be payable

for the period of 3 days at the rate of interest applicable for equivalent period of deposit. Since

the actual number of days is less than 7 days, the applicable rate of interest will be the

corresponding rate of interest for minimum tenure of term deposit i.e. 714 days.

b) In case of extraordinary delay, i.e. delays exceeding 30 days (excluding normal period of

collection) interest will be paid at the rate of 2% above the corresponding Term Deposit rate. e.g.

If a cheque payable at Chennai is deposited at Mumbai on 1st

January 2007 and credited to the

customers account on 11th

February 2007, the actual period of delay will be 34 days consisting

of 30 days normal delay and 4 days abnormal delay. Interest will be payable for the period of 30

days at the rate of interest applicable for equivalent period of deposit and for the period of 4 days

at 2% over and above the interest applicable for delay. The applicable rate of interest will be the

corresponding rate of interest for the period of 34 days.


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c) In the event the proceeds of cheque under collection were to be credited to an

overdraft/loan account of the customer, interest will be paid at the rate applicable to the loan

account. For extraordinary delays, interest will be paid at the rate of 2% above the rate applicable

to the loan account

It may be noted that interest payment as given above would be applicable only for instruments

sent for collection within India.

The banks compensation policy for financial loss suffered by the customers due to loss of

instrument after it has been handed over to the bank for collection by the customer would also be

as indicated in our collection policy. The same is extracted below for information:

Cheques / Instruments lost in transit / in clearing process or at paying banks branch:

In the event a cheque or an instrument accepted for collection is lost in transit or in the clearing

process or at the paying banks branch, the bank shall immediately on coming to know of the

loss, bring the same to the notice of the accountholder so that the accountholder can inform the

drawer to record stop payment and also take care that cheques, if any, issued by him / her are not

dishonored due to non-credit of the amount of the lost cheques / instruments. The bank would

provide all assistance to the customer to obtain a duplicate instrument from the drawer of the

cheque.

In line with the compensation policy of the bank the bank will compensate the accountholder in

respect of instruments lost in transit in the following way:

a) Expenses incurred for obtaining duplicate instruments will be paid @2% of the amount of

instruments subject to maximum of Rs.500.

b) Interest will be paid for a maximum period of 30 days at the rate applicable for relevant

period of fixed deposit prevailing at the time of payment of interest.


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c) In case the customer demands, the bank would also compensate the customer any charges

incurred by the drawer for recording stop payment of the lost cheque/instrument upon production

of receipt.

6. Violation of the Code by banks agent

In the event of receipt of any complaint from the customer that the banks representative / courier

or DSA has engaged in any improper conduct or acted in violation of the Code of Banks

Commitment to Customers, which the bank has adopted voluntarily, bank shall take appropriate

steps to investigate and to handle the complaint and to compensate the customer for financial

losses as being done in case of cheques /instruments lost in transit/ in clearing process or at

paying banks branch.

7. Transaction of at par instruments of Co-operative Banks by Commercial Banks

The RBI has expressed concern over the lack of transparency in the arrangement for payment of

at par instruments of co-operative banks by commercial banks resulting in dishonor of such

instruments when the remitter has already paid for the instruments. In this connection it is

clarified that the bank will not honor cheques drawn on current accounts maintained by other

banks with it unless arrangements are made for funding cheques issued. Issuing bank should be

responsible to compensate the cheque holder for nonpayment/delayed payment of cheques in the

absence of adequate funding arrangement.

8. Force Majeure

The bank shall not be liable to compensate customers for delayed credit if some unforeseen event

(including but not limited to) civil commotion, sabotage, lockout, strike or other labour

disturbances, accident, fires, natural disasters or other Acts of God, war, damage to the banks


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facilities or of its correspondent bank(s), absence of the usual means of communication or all

types of transportation, etc. beyond the control of the bank prevents it from performing its

obligations within the specified service delivery parameters.

4.2 GRIEVANCE REDRESSAL POLICY

In the present scenario of competitive banking, excellence in customer service is the most

important tool for sustained business growth. Customer complaints are part of the business life of

any corporate entity. This is more so for banks because banks are service organizations. As a

service organization, customer service and customer satisfaction are the prime concern of the

bank.

This policy document aims at minimizing instances of customer complaints and grievances

through proper service delivery and review mechanism and prompt redressal of customer

complaints and grievances.

The banks policy on grievance redressal is governed by the following principles:

i. Customers are treated fairly at all times

ii. Complaints raised by customers are dealt with courtesy and on time

iii. Customers are fully informed of avenues to escalate their complaints/grievances within

the organization and their rights to alternative remedy, if they are not fully satisfied with the

response of the bank to their complaints.

iv. Bank will treat all complaints efficiently and fairly and will be seen as opportunities for

improvement.

v. The bank employees must work in good faith keeping in mind Banks policy and without

prejudice to interest of the customer.


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In order to make banks redressal mechanism more meaningful and effective, a structured system

is built up towards such end. The system ensures that the redressal sought is just and fair and is

within the given framework of rules and regulations. The policy document will be made

available at all branches. The concerned employees will be educated about the complaint

handling process.

The customer will have the full right to register his complaint if he is not satisfied with the

services provided by the bank. He can give his complaint in writing, orally or over telephone. If

customers complaint is not resolved within given time or if he is not satisfied with the solution

provided by the bank, he will have the right to approach Banking Ombudsman with his

complaint or other legal avenues available for grievance redressal.

4.3 Internal Machinery to handle Customer complaints/ grievances

4.3.1 Three tier grievance redressal system

The Bank will have public grievances machinery functioning at three levels i.e. Branch, Regional

and Central Office level. All complaints received at every level will be immediately

acknowledged, redressed and final reply will be given to the complainants.

4.3.2 Nodal Officer and other designated officials to handle complaints and

grievances

Bank will appoint a Nodal Officer of the rank of General Manager who will be responsible for

the implementation of customer service and complaint handling for the entire bank. At field level

Regional Heads will be designated to handle complaints/grievances in respect of branches falling

under their control...


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If the complaint is received in writing, bank will send an acknowledgement/ a response within a

week. If the complaint is relayed over phone at our designated telephone helpdesk or customer

service number bank will provide the customer a complaint reference number and keep him/her

informed of the progress within a reasonable period of time. After examining the matter, bank

will send to the customer final response or explain why we need more time to respond within a

period of six weeks of receipt of the complaint and will tell the customer how to take the

complaint further if he/she is still not satisfied.

Branch and Regional Office will send action taken report on complaints received to the Regional

Office and Central Office respectively at the end of every month.

4.6 Committees on Customer Service in Bank

Customer Service Committee of the Board

While board is the Competent Authority for formulation of a Comprehensive Deposit Policy and

Loan Policy, recommendations of this sub-committee of the Board will be taken into account for

fine- tuning the policies and processes. This Committee will review the functioning of Standing

Committee on Customer Service including compliance with the recommendations of the

Committee on Procedures and Performance Audit of Public Services (CPPAPS). The Committee

will also suggest innovative measures of enhancing the quality of customer service and

improving the level of customer satisfaction for all categories of customers at all times.

Standing Committee on Customer Service

The Standing Committee on Customer Service will be chaired by the Managing Director/

Executive Director of the bank. Besides two to three senior executives of the bank, the


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committee will also have two to three eminent non-executives drawn from the public as

members. The Committees functions are as under:

i. The Committee will evaluate feedback on quality of customer service received from

various quarters.

ii. The committee will also review comments/ feedback on customer service and

implementation of commitments in the Code of Banks Commitments to Customers received

from BCSBI.

iii. The Committee will be responsible to ensure timely and effective implementation of all

regulatory instructions regarding customer service. It will also receive necessary feedback to

determine that the action taken by various departments is in tune with the spirit and intent of

such instructions.

iv. The Committee will look into the simplification of procedures and practices prevailing in

the Bank, with a view to safeguarding the interests of common persons, be they current or

savings accountholders, depositors or borrowers from any unfair procedural practices by banks.

v. The Committee will review the systems in place for providing service to the customers in

respect of

(i) meeting their demands for fresh/good notes and coins of all denominations,

(ii) exchanging soiled notes,

(iii) adjudicating mutilated notes and (iv) accepting coins and notes either for transactions or

in exchange.

vi. The Committee will review the regulations and procedures prescribed by Reserve Bank

of India that impinge on customer service of banks and make suitable recommendations for


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4.8 Sensitizing operating staff on handling complaints

Staff will be properly trained for handling complaints. We are dealing with people and hence

difference of opinion and areas of friction can arise. With an open mind and a smile on the face

we should be able to win the customers confidence. It will be the responsibility of the Nodal

Officer to ensure that internal machinery for handling complaints/grievances operates smoothly

and efficiently at all levels. He should give feed back on training needs of staff at various levels

to the HR Dept.

Tech-SavvyWith the age of global banking, Union Bank of India also changed its style, boasting of

urbanized and computerized core banking systems. A front runner among public sector banks in

modern-day banking, it has all the facilities that a modern bank should have - internet banking

and centrally computerized branches. UBI was one of the pioneer public sector banks, which

launched Core Banking Solution in 2002. As of September 2005, more than 670

branches/extension counters of Bank are networked under Core Banking Solution. The Bank has

launched multiple Electronic Delivery Channels and has installed nearly 423 networked ATMs.


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Chapter5.

Products & Services


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5.1 Union Bank of India Credit Cards

Union Bank of India has three International Credit Cards designed to meet your unique lifestyle

and shopping needs. Bank has three types of credit cards-Union card- Classic, Silver and Gold.

The bank offers various features and benefits on its cards including Cash Advance round the

clock at all ATMs, Photo card option, Accident Insurance, Reward Program, Flexi payment, etc.

1.

Classic Card :

Cards are issued with photograph and signature of the cardholder printed for enhancedsafety. SPENDING LIMIT: 25% of annual income with a minimum of Rs.15000 and a

maximum of Rs.5.00 lacs.

Option to pay a minimum of 10% of the outstanding amount and option to carry over thebalance.

Lowest interest rate of 20.40% per annum only on the outstanding balance on dailyproduct basis. 25% of Annual gross income reported with a minimum limit of 15000/.

2. Silver Card:

Cards are issued with photograph and signature of the cardholder printed for enhancedsafety. SPENDING LIMIT: 25% of Annual Gross Income reported with a minimum of Rs.25000



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3. Gold Card:

Cards are issued with photograph and signature of the cardholder printed for enhancedsafety. SPENDING LIMIT: 25% of Annual gross income or Rs.1 lac whichever is higher.



Union Bank of India International Debit Card

5.2 ATM SERVICES

A T M (Automated Teller Machine) facilitates the customer to do Banking transactions such as

Cash withdrawal, balance enquiry, obtaining mini-statement, transfer of funds between his/her

own accounts etc. Union Bank of India tied up with Visa for issuing International Debit Cards to

the customers of all its branches. The Debit Card provides ANY TIME / ANY WHERE

Banking to the customers. Presently, Bank has 1276 ATMs (As on 30.06.2008) which are on-

line, conveniently located and spread across the country. The Debit Card can also be used for


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making purchases. The daily withdrawal limit through ATMs is Rs.25000/- and the limit for

making purchases is Rs.25, 000/- (combined limit Rs.50, 000/-).

Issue of ATM cum Debit Card to customer is made very simple and most convenient. A Ready

kit containing both Debit Card and Pin are handed over to the customer immediately on opening

of the account and in case of existing customers, the same is provided immediately on demand.

The Debit Card is activated on the next working day. There is absolutely no waiting period for

obtaining the Debit Card from the Bank. Experience for yourself by opening an account with any

of our CBS branches and getting the Ready kit instantly. .

The Debit card gets activated only when it is used along with PIN at ATM for cash withdrawal.

Only after the first transaction at ATM, the customer will be able to use the Debit Card for

making purchases.

For providing better facility and wider acceptance of the Debit Card, the Bank has entered into

ATM sharing arrangements with Cash Tree Group, SBI group, NFS group and VISA. Under

these arrangements Union Bank cardholder can access over 32000 ATMs of 42 banks across the

country

Union Bank has completely freed the transaction charges for using its cards in any other Banks

ATM all over India. International Transactions2% Currency Conversion charges extra


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5.3 Union Bank of India Online Tax-Payment

Online Tax payment is the facility which allows the bank's customer to pay their Taxes online.

DIRECT TAX PAYMENTUnion Bank of India has extended the online direct tax payment facility to its Internet Banking

users.

CENTRAL EXCISE & SERVICE TAX PAYMENTUnion Bank of India has extended the online tax payment facility to its Internet Banking users.

Customer can generate duplicate challans from his Internet Banking module.

ICEGATE - INDIAN CUSTOMS AND EXCISE GATEWAYUsers registered at ICEGATE can use the facility of online payment in addition to the existing

facility. The registered users will be able to make the duty payment for all the documents filed

throug

Documents

New Union Bank of India Final - Copy