Org Stdy Final

CMRIMS (Autonomous) The J&K Bank Ltd.
CHAPTER 1
INDUSTRY PROFILE
INTRODUCTION
Origin of the Word “Bank”
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Opinion is not uniform with regard to the origin of the word “bank”. According to
some authors the word “bank” is derived from the words “bancus” or ‘banquet’ that is
a bench. The early bankers, the Jews in Italy transacted their business on the benches
in the market place, when a banker failed; his bench was broken into pieces by the
people, which indicated the bankruptcy of the individual banker. But the explanation
was turned out on the ground that the Italian moneychangers as such were never
called bankers in the Middle Ages. Some others say that the word ‘bank’ originally
derived from the German word “pack” meaning a “joint stock fund”, which was
Italianated into “banco”, when the Germans were masters of the great part of Italy.
According to Professor Ramachandra Rao “whatever be the origin of the word bank,
it would trace the history of banking in Europe from the middle ages.”
Crowther defines, a bank “collects money from those who have it to spare or who are
saving it out incomes, and lends this money to those who require it”
The Indian companies Act 1949, defines banking as “ the accepting for the purpose
of Indian Companies lending or investment, of deposits of money from the public,
repayable on demand or otherwise, withdrawals by cheques, drafts, orders or
otherwise”.
As per Act term banking includes not only the above mentioned important activities
but also several activities such as collection of cheques, drafts and bills, remittance of
funds, acceptance of safe deposits etc. which is generally referred to as subsidiary
services.
The term bank in the modern times refers to an institution having the following
features:
1. It deals with money; it accepts deposits and advances loans.
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2. It also deals with money; it has the ability to create Credit i.e., the ability to
expand its liabilities, as a multiple of its reserves.
3. It is a commercial institution; it aims at earning profit.
Origin of Banks
A bank is a financial institution that accepts deposits and channels those deposits into
lending activities. Banks primarily provide financial services to customers while
enriching investors. The invention of banking preceded that of coinage. Banking
originated in Ancient Mesopotamia where the royal palaces and temples provided
secure places for the safe-keeping of grain and other commodities. Receipts came to
be used for transfers not only to the original depositors but also to third parties.
Eventually private houses in Mesopotamia also got involved in these banking
operations and laws regulating them were included in the code of Hammurabi.
In Egypt too the centralization of harvests in state warehouses also led to the
development of a system of banking. Written orders for the withdrawal of separate
lots of grain by owners whose crops had been deposited there for safety and
convenience, or which had been compulsorily deposited to the credit of the king, soon
became used as a more general method of payment of debts to other persons including
tax gatherers, priests and traders. Even after the introduction of coinage these
Egyptian grain banks served to reduce the need for precious metals which tended to
be reserved for foreign purchases, particularly in connection with military activities.
Precious metals, in weighed quantities, were a common form of money in ancient

times. The transition to quantities that could be counted rather than weighed came
gradually. On page 29 of A History of Money Glyn Davies points out that the words
“spend", "expenditure", and "pound" (as in the main British monetary unit) all comes
from the Latin "expender" meaning "to weigh". On page 74 the author points out that
the basic unit of weight in the Greek speaking world was the "drachma" or
“handful" of grain, but the precise weight taken to represent this varied considerably,
for example from less than 3 grams in Corinth to more than 6 grams in Aegina.
Throughout much of the ancient world the basic unit of money was the stater,
meaning literally "balancer" or "weigher". The talent is a monetary unit with which
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we are familiar with from the Parable of the Talents in the Bible. The talent was also a
Greek unit of weight, about 60 pounds.
Banking
Banking in one form or another, it was in existence even in ancient times. Authorities
on banking are divided in their option regarding the origin of the term bank. The
banking scenario of the country has undergone a radical transformation owing to
liberalization, globalization, automation and implementation of reforms. This has
prompted banks to redefine business strategies to survive and sustain competition.
Beginning of Issue and Deposits:
The money business performed by the earlier goldsmiths in England has been
considered as the beginning of the banking. The goldsmiths who received money for
sake custody against their signed receipts have given an undertaking to return the
money to the depositor or the bearer on demand. This development in course to time
gave rise to emergence of the issue and deposit banking. The goldsmiths having
accepted the money for safe custody issued receipts, which became bank notes. The
bank notes accepted in exchange of money and vice versa and enjoyed considerable
circulation. This marked of the beginning of the banking in England.
Evolution of Modern Banking
The growth of banking in England in the nineteenth century paved the way for the
establishment of the systemized banking system in the world. Banking institutions
were having past performed limited functions such as receiving deposits against bank
notes and the issuing notes in the country. As the time advanced, commerce industry
expanded and the scope of the banking also expanded. Banking institutions deal with
the large number of the services to the customers. They serve as custodian of stocks,
shares and valuables. They finance imports and exports. The documents relating to
imports and exports are passed through banks. They deal not only with bills of
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exchange, but also with bills of lading, railway receipts, warehouse, warrants and
receipts, marine insurance policies and so on.
Origin of Banking in India
India has a well developed banking system. Most of the banks in India were founded
by Indian entrepreneurs and visionaries in the pre-independence era to provide
financial assistance to traders, agriculturists and budding Indian industrialists. The
origin of banking in India can be traced back to the last decades of the 18th century.
The General Bank of India and the Bank of Hindustan, which started in 1786 were the
first banks in India. Both the banks are now defunct. The oldest bank in existence in
India at the moment is the State Bank of India. The State Bank of India came into
existence in 1806. At that time it was known as the Bank of Calcutta. SBI is presently
the largest commercial bank in the country.
Banking in India originated in the last decades of the 18th century. The first banks
were The General Bank of India which started in 1786, and the Bank of Hindustan,
both of which are now defunct. The oldest bank in existence in India is the State Bank
of India, which originated in the Bank of Calcutta in June 1806, which almost
immediately became the Bank of Bengal. This was one of the three presidency banks,
the other two being the Bank of Bombay and the Bank of Madras, all three of which
were established under charters from the British East India Company. For many years
the Presidency banks acted as quasi-central banks, as did their successors. The three
banks merged in 1921 to form the Imperial Bank of India, which, upon India's
independence, became the State Bank of India.
When the American Civil War stopped the supply of cotton to Lancashire from

the Confederate States, promoters opened banks to finance trading in Indian cotton.
With large exposure to speculative ventures, most of the banks opened in India during
that period failed. The depositors lost money and lost interest in keeping deposits with
banks. Subsequently, banking in India remained the exclusive domain of Europeans
for next several decades until the beginning of the 20th century.
Foreign banks too started to arrive, particularly in Calcutta, in the 1860s.

The Comptoire d'Escompte de Paris opened a branch in Calcutta in 1860, and another
in Bombay in 1862; branches in Madras and Pondicherry, then a French colony,
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followed. HSBC established itself in Bengal in 1869. Calcutta was the most active

trading port in India, mainly due to the trade of the British Empire, and so became a
banking centre.
The first entirely Indian joint stock bank was the Oudh Commercial Bank, established
in 1881 in Faizabad. It failed in 1958. The next was the Punjab National Bank,
established in Lahore in 1895, which has survived to the present and is now one of the
largest banks in India.
Around the turn of the 20th Century, the Indian economy was passing through a
relative period of stability. Around five decades had elapsed since the Indian Mutiny,
and the social, industrial and other infrastructure had improved. Indians had
established small banks, most of which served particular ethnic and religious
communities.
The presidency banks dominated banking in India but there were also some exchange
banks and a number of Indian joint stock banks. All these banks operated in different
segments of the economy. The exchange banks, mostly owned by Europeans,
concentrated on financing foreign trade. Indian joint stock banks were generally
undercapitalized and lacked the experience and maturity to compete with the
presidency and exchange banks. This segmentation let Lord Curzon to observe, "In
respect of banking it seems we are behind the times. We are like some old fashioned
sailing ship, divided by solid wooden bulkheads into separate and cumbersome
compartments."
The period between 1906 and 1911, saw the establishment of banks inspired by
the Swadeshi movement. The Swadeshi movement inspired local businessmen and
political figures to found banks of and for the Indian community. A number of banks
established then have survived to the present such as Bank of India, Corporation
Bank, Indian Bank, Bank of Baroda, Canara Bank and Central Bank of India.
The partition of India in 1947 adversely impacted the economies of Punjab and West

Bengal, paralyzing banking activities for months. India's independence marked the
end of a regime of the Laissez-faire for the Indian banking. The Government of
India initiated measures to play an active role in the economic life of the nation, and
the Industrial Policy Resolution adopted by the government in 1948 envisaged
a mixed economy. This resulted into greater involvement of the state in different
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segments of the economy including banking and finance. The major steps to regulate
banking included:
 In 1948, the Reserve Bank of India, India's central banking authority, was

nationalized, and it became an institution owned by the Government of India.
 In 1949, the Banking Regulation Act was enacted which empowered the
Reserve Bank of India (RBI) "to regulate, control, and inspect the banks in India."
 The Banking Regulation Act also provided that no new bank or branch of an
existing bank could be opened without a license from the RBI, and no two banks
could have common directors.
However, despite these provisions, control and regulations, banks in India except
the State Bank of India continued to be owned and operated by private persons. This
changed with the nationalization of major banks in India on 19 July 1969
By the 1960s, the Indian banking industry had become an important tool to facilitate
the development of the Indian economy. At the same time, it had emerged as a large
employer, and a debate had ensued about the possibility to nationalize the banking
industry. Indira Gandhi, the-then Prime Minister of India expressed the intention of
the GOI in the annual conference of the All India Congress Meeting in a paper
entitled "Stray thoughts on Bank Nationalization." The paper was received with
positive enthusiasm. Thereafter, her move was swift and sudden, and the GOI issued
an ordinance and nationalized the 14 largest commercial banks with effect from the
midnight of July 19, 1969. Jayaprakash Narayan, a national leader of India, described
the step as a "masterstroke of political sagacity."Within two weeks of the issue of the
ordinance, the Parliament passed the Banking Companies (Acquisition and Transfer
of Undertaking) Bill, and it received the presidential approval on 9 August 1969.
The nationalized banks were credited by some; including Home minister P.

Chidambaram, to have helped the Indian economy withstand the global financial
crisis of 2007-2009.
In the early 1990s, the then Narsimha Rao government embarked on a policy

of liberalization, licensing a small number of private banks. These came to be known
as New Generation tech-savvy banks, and included Global Trust Bank which later
amalgamated with Oriental Bank of Commerce, Axis Bank(earlier as UTI
Bank), ICICI Bank and HDFC Bank. This move, along with the rapid growth in
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the economy of India, revitalized the banking sector in India, which has seen rapid
growth with strong contribution from all the three sectors of banks, namely,
government banks, private banks and foreign banks.
The next stage for the Indian banking has been setup with the proposed relaxation in
the norms for Foreign Direct Investment, where all Foreign Investors in banks may be
given voting rights which could exceed the present cap of 10%, at present it has gone
up to 74% with some restrictions.
The new policy shook the Banking sector in India completely. Bankers, till this time,
were used to the 4-6-4 method (Borrow at 4%; Lend at 6%;Go home at 4) of
functioning. The new wave ushered in a modern outlook and tech-savvy methods of
working for traditional banks. All this led to the retail boom in India. People not just
demanded more from their banks but also received more.
Currently (2007), banking in India is generally fairly mature in terms of supply,

product range and reach-even though reach in rural India still remains a challenge for
the private sector and foreign banks. In terms of quality of assets and capital
adequacy, Indian banks are considered to have clean, strong and transparent balance
sheets relative to other banks in comparable economies in its region. The Reserve
Bank of India is an autonomous body, with minimal pressure from the government.
The stated policy of the Bank on the Indian Rupee is to manage volatility but without
any fixed exchange rate-and this has mostly been true.
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CHAPTER 2
COMPANY PROFILE
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INTRODUCTION
The J&K Bank is one of the fastest growing listed banks in the country with more
than 632 offices across the country and has recently become a billion Dollar
Company. The bank has a history of more than 6 decades of the operations and a track
record of dividend payment and profitability for last more than 4 decades. The bank
has been rated among top 1000 banks of the world and 100 banks of the Asian region,
ahead of most of its contemporaries. With an annual turnover of more than US$ 10
billion, J&K Bank is on its way to become the universal bank in Jammu & Kashmir, a
super specialist bank in India and world-class services bank within the global banking
space.
The bank has its headquarters in Srinagar city and has various departments &
branches in different parts of the country. All these are well established all over the
country. It is a Sole banker and lender of last resort to the Government of J & K. The
company has well past records and profitability over four decades. The bank is best in
its corporate social responsibility. It is the fastest growing bank and has changed lives
of many people.
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History
The idea of establishing ‘The Jammu & Kashmir Bank’ was conceived in the 1920 by
the then Maharaja of the state his highness Maharaja Hari Singh with the aim to
ameliorate the economic and social position of the people of the state. The scheme to
incorporate the bank was formulated by an imminent banker Sir Sorobiji N.
Pochkanwalla, the then Managing Director of the central Bank of India. The bank got
incorporated on 1st October 1938 commencing business on 4th July, 1939. 53% of the
equity is held by the Government of J&K. it is the first state owned bank of the
country having a consistent track record of growth and profitability. The bank has a
unique distinction of being the banker to J&K state government and has been
appointed by the RBI as its agency in J&K for carrying general banking business of
the central government and collection of taxes pertaining to central Board of Direct
taxes. Until 1955, the bank’s energies remained focused on consolidation with the
strength of offices confined to 13. From this small beginning the bank has spread to
every note and corner of the country with a network of 632 offices. The bank serving
as a beacon light with the goal of earning customer trust blended with a personal,
human touch in traversing on the path of prosperity with a well-defined corporate
mission. The bank keeping its promise and fulfilling its purpose provides a stepping
stone to the state economy with a particular emphasis on the developing trade,
commerce, industry and agriculture, areas that had been pushed in the background in
absence of a state bank. Today the bank is literally a leader with a well-diversified
range of products and services serving a wide range of client. In recognition of the
making contribution in the field of the banking, the bank had been ranked No. 2
among private sector banks. With the advent of the laissez-faire the banks all set to
face challenges posed by the fluid and changing global banking. According to the
extended Central laws of the state, Jammu & Kashmir Bank was defined as a govt.
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. Today the bank has more than 632 offices across the country and has
recently become a billion Dollar Company.
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Brand Identity
The new identity for J&K Bank is a visual representation of the Bank’s philosophy
and business strategy. The three colored squares represent the regions of Jammu,
Kashmir and Ladakh. 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. Green signifies
growth and renewal, blue conveys stability and unity, and red represents energy and
power. All these attributes are integrated and assimilated in the white counter-form.
Technology driven operations:
J & K Bank has Implemented Human Capital Management with the help of Wipro
InfoTech. The solution has helped streamlining the HR management of the bank, J &
K Bank has an employee force of more than 10,000. It will also enable the cutting
down of paper work to a major extent and reduction of manual work thereby lending
alacrity to HR processes, according to the company. Some of the modules
implemented by Wipro include talent acquisition manager and candidate gateway
(Recruitment), administer training, e-Development, e-Performance, e-Profile Manager
Desktop, e-Profile, profile management, global payroll for India, absence
management and approval workflow engine. As a result of this implementation all the
zones and branches are connected to the centralized HR system and a customized
claims management system has been deployed to facilitate the claims process, which
also includes an interface to Oracle's PeopleSoft Enterprise Payroll. In today's
competitive world it is important to streamline processes through an effective
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implementation of technology. In these difficult times, it is imperative to cut down

processes so as to increase efficiency.
J & k bank have re-engineered the HR processes. They have replaced the old manual
HR system to centralize the HR information thereby improving efficiencies in their
HR processes and Systems. Maintaining a progressive outlook, the J&K Bank is
keeping pace with the changing technology. The Bank continues to leverage
information technology as a strategic tool for its business operations. The IT strategy
emphasizes enhanced level of customer services through 24x7 availability, multi
channel banking, and cost efficiency through optimal use of electronic channels,
wider market reach and opportunities for cross selling. The initiatives already under
way have been given a further to accelerate growth with tech commitment.
The bank has issued over 2.5 lakh J&K Bank Global Access Debit Cards until March
end 2010. Bank has already launched credit card which is available at all offices of
the bank across the country. Tele banking facility is now available at 62 business
locations of Jammu and Kashmir Zones. Currently 98.4 % business of the bank is
computerized.
The number of offices brought under computerization programme has increased to

520 at the end of March 2010. The bank has an ambitious plan of achieving total
automation of operations by the year 2011.Anywhere banking facility was extended
too many new locations, thereby giving the customer the advantage of anywhere
banking at 300 offices at the end of 31 st march 2010. The number of ATMs of the
Bank already installed or under process of installation has increased to 220 during the
year under report.
Philosophy
The bank’s philosophy is woven around its total commitment to the ethical practices
in the conduct of its business, while striving in the constant quest to grow with profits
and enhance shareholders value and align the interests of the stakeholders and society
through adoption of best international practices and standards. J & K Bank is
committed to the best and transparent corporate governance practices, which in turn
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provides best value to all its stakeholders through highly motivated personnel,
visionary leadership, respect for people and society.
Goals
 Keep on creating wealth and focus on high earnings and growth.

 To be partners in the economic and social transformation of the nation.
 Become visible in the International market.
 Make banking activity more simple and fast.
 To engender and catalyze the economic transformation of Jammu and
Kashmir and capitalize from the growth induced financial prosperity.
Vision
“To catalyze economic transformation and capitalize on growth”. J & K Bank’s vision
is to engender and catalyze economic transformation Of Jammu and Kashmir and
capitalize from the growth induced financial prosperity thus engineered. The Bank
aspires to make Jammu and Kashmir the most prosperous state in the country, by
helping create a new financial architecture for the J&K Economy, at the center of
which will be the J&K Bank.
Mission and strategy:
J & K Bank’s mission is two-fold: To provide the people of J&K International quality
financial service and solutions and to be a super specialist Bank in the rest of the
country. The two together will make J & K Bank the most profitable Bank in the
country. The mission of the bank is to strive to be a financially strong, sound, growth
oriented and profitable bank with main focus towards providing convenient, reliable,
cost effective and personalized services to its customers.
 To focus on high earnings growth with low volatility.
 To increase visibility in market and enhance market share by exploiting new
markets in India’s expanding Baking and Financial services industry by
following a disciplined growth strategy.
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 To maintain high quality asset and credit risk management.
Unique characteristics: one of a kind
Value
 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 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.
Staff & Work environment
 As the people are the most important resource to achieve the growth and
enhance the corporate image of an organization, foremost importance is given
to development of human resources in the Bank to enable them to cope up
with the rapidly changing Banking needs. As the quality of human resources
indicates the ability of Bank to deliver value to its customers, foremost
attention is being given to development of skill, attitude and knowledge of the
staff. Emphasis has been on integrating HRM strategies with business
strategies. HRM strategies of the Bank include managing change, creating
commitment, infusing flexibility and improving teamwork.
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People Management
 In a landmark move, the J&K Bank had announced an enviable package of

incentives and opportunities for its employees to groom an energized and
committed human resource for the Bank's ambitious expansion plans.
 "The philosophy and approach of leadership towards people's issues is that the
employee oriented issues must include recruitment, development and learning,
work environment and communication, rewards and recognition, health and
well being, balancing work and personal life and last but not the least financial
security,
 The crucial role played by the employees of the Bank in its exceptional
growth, the organization emphasizes that the employees are the drivers of the
human resource while the top management and the human resource team are
only the facilitators.
 Transparency, people-oriented policies and a culture of knowledge-sharing is

the Bank's philosophy, and the management of the Bank is committed to
ensure a work place, a work culture and a work environment that fully engages
the intellectual and emotional commitment of its employees.
 The employee-oriented measures would achieve a real competitive advantage

by nurturing the real assets of the Bank - its people. The set of incentives
include skill advancement programmes, pay enhancement, mass promotions,
an improved transfer policy, increase in variable and revamped performance
management system, regularization of all the adhoc employees, a new
generation organizational set up and designations and foreign tour on LFC.
Style of organization
The bank’s framework had been changed, as per the restructured organizational
framework, The General Managers have been designated as Presidents, DGMs as
Vice-Presidents, AGMs as Senior Executive Managers, Chief Mangers as
Executive Mangers, Scale-III as Senior Executive, Scale-II as Executive, Scale-I
as Associate Executive, Cashier-cum-Clerk as Banking Associates, Assistant
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Cashier-cum-Clerks as Assistant Banking Associates and Peons as Banking

Attendants.
Achievements, Recognition and Awards
 J&K Bank was awarded Wisitex ICT Ratan in July 2010.

 Bank has established MetLife office in Srinagar.
 J&K Bank had handled registration of Amaranth Yatris.
 J&K Bank recommended 220% dividend to shareholders .
 J&K Bank was awarded Jamnalal Bajaj Uchit Vyavahar Puraskar in 2003.
 J&K Bank also got ‘P1+’ rating.
 J&K Bank also sliced lending rates, it also announced special package for
handicraft sector. 3.75% interest rate was cut in Agriculture sector which
boosted the sector.
 Retirement Age was enhanced to 60 from 58.
 Various campaigns have been launched like “I am listening” campaign.
Corporate social responsibility
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 CSR is not
just recognized as promulgating the Bank's own values and principles of philanthropy
but also the values and principles of all those who have a stake in it or are affected by
its operations. By supporting social cause aligned to the mission the CSR strategy
differentiates the Bank's brand and enhances its reputation. The Bank manages social
issues in the same manner as any other strategic business issues.
The Bank besides playing its role in economic development of the State and country
contributes significantly towards the social cause.
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 The Bank has established its credentials for the poor and needy by donating
generously for various philanthropic activities aimed at ameliorating their
sufferings.
 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. The one and a half decades
long turmoil in the State of J&K has added to the agonies of people with
hundreds of children losing their parents to fend for themselves in this harsh
world.
 The Bank realizing its responsibility of saving the life/ future of these
blooming children, adopt several of them by providing financial support either
through various orphanages where they are sheltered or directly to the orphans
by bearing their educational or other expenditure.
 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. and sponsoring seminars and awareness camps, art
and literary works, 3rd cultural activities, social service camps, college or
university students clubs 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 Amaranth Yatra through its extensive network
of offices spread across the country. The Yatra is an annual religious function
of Hindu community, wherein devotees travel by foot to pay obeisance to
Holy Shiv Lingam at Shree Amaranth cave.
 Apart from above activities the Bank has been constructing/developing the
public utility service like public parks, bus stands, drinking water posts,
lavatories, conveniences, rain shelters.
 Managing CSR is not viewed as an extra cost or burden but is viewed not only
as making good business sense but also contributing to the long-term
prosperity of our Bank and ultimately its survival. Being a good neighbor and
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showing that you care on the one hand and being a successful business on the
other, are flip sides of the same coin.
The vision of bank is summed up in one word “growth”
 The fastest growing bank with more than 632 offices across the country.
 A listed Company on BSE and NSE with 53% equity held by J&K State
Government.
 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 SEBI.

 Listed on the National Stock Exchange (NSE) and Bombay Stock Exchange
(BSE)
 Rated "P1+" by Standard and Poor- CRISIL connoting highest degree of
safety.
 Four decades of uninterrupted profitability and dividends.

 Tele-banking facility available at 62 offices.
 Net Profit up 25 % at Rs 512.38 crore for the financial year ended Mar, 2010
as compared to Rs 409.84 crore for the previous financial year.
 The Business Turnover as on March 31, 2010 has increased by 12 % to Rs
60294 crore from Rs 53935 crore as on March 31, 2009.
 24 hours and 365 days banking service through Automated teller machines
(ATMs) available at 210 locations connected with IST switch for single card
usage at all locations.
Performance of the Bank
Previous Annual Reports The Bank continued to make strides in its
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business operations. The Bank achieved an all time high business turnover
of Rs. 60294 crore during the year under report against the last year figure
of Rs 53935 crore recording a steady growth of 12%. The core segments of
Bank’s business viz. Deposits, Advances, Foreign Exchange and Treasury
Operations recorded an impressive growth. The outstanding performance
recorded by the Bank in its operations boosted the price of Bank’s share in
the stock market to all time high of more than Rs. 1000 despite subdued
equity market in the last year.
Capital & Reserves
The Capital & Reserves of the Bank increased by Rs. 305 crore to Rs. 1242
crore during the year from Rs. 937 crore of the previous year registering an
impressive growth of 32.55%. The Statutory and other Reserves increased
by 34.46% to Rs. 1195.35 crore from Rs. 889 crore of the previous year.
Profit The Bank posted a net profit of Rs. 512.8

crore for the financial year 2009-10
recording an impressive increase of 25%
over the last year’s net profit of Rs. 409.00
crore.
Turnover The total income of the Bank at Rs. 60294

crore for the year under report recorded a
growth of 12% over the previous year
figures of Rs. 53935 crore. The per branch
and per employee income has increased to
Rs. 437.39 lakhs and Rs. 24.11 lakhs
respectively.
Dividend In view of the sustained excellent financial

results, Directors are pleased to recommend
payment of Rs. 106.65 crore dividend @
220 % (Rs 22.00 per share) for the year
ending March 2010 as compared to Rs
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81.97 crore @ 169 % (Rs 16.90 per share)

for the financial year ended Mar, 2009.
Foreign Exchange
The Foreign Exchange business of the Bank continued its splendid growth.
During the year under report the Bank achieved Foreign Exchange business
turnover of Rs. 3666.37 crore against Rs. 2954.44 crore of the previous
year showing a remarkable growth of 24.10%. The contribution of this
segment to the Bank’s gross income has been to the tune of Rs. 27.54 crore
against Rs. 18.93 crore of the previous years. The export turnover of the
Bank increased from Rs. 1339.11 crore to Rs. 1782.45 crore registering a
growth of 33.10%. The Dealing Room and Treasury Operations recorded a
turnover of Rs. 40317.02 crore and generated a net earning of Rs. 5.46
crore against Rs. 3.30 crore of the previous year, thus registering an
emphatic increase of 65.45%.
Insurance Business
During the year under report the Bank formally commenced distribution of
insurance products of M/S Metlife Insurance India (P) Ltd. and Bajaj
Allianz General Insurance Co. Ltd. It is a matter of satisfaction that a good
beginning has been made in this area of business. Bank has been able to sell
3639 life policies of MetLife and collected annualized premium amount of
Rs. 410.64 lakhs in the first year. In the case of non-life business, the Bank
has been able to perform even better and collected aggregate premium
amount of Rs. 535.33 lakhs thereby surpassed the target of Rs. 450 lakhs
fixed for the year under report. This has yielded non-interest income of Rs.
170.84 lakhs resulting in net earnings of Rs. 58.05 lakhs to the Bank during
the year.
Lead Responsibility of the Bank
The Bank continued to discharge its Lead Bank Responsibility in 8 out of

14 districts of J&K State satisfactorily. Two State Level Bankers’
21
Committee meetings (SLBC) and two Subcommittee meetings of State

Level Bankers’ Committee were convened during the year 2008-09. The
block and district level meetings such as BLBC, DCC and DLRC were held
as per schedule in all the lead districts. The district credit plans were
prepared in time and their implementation monitored closely at the State
and district Levels.
Community Service
The Bank as a responsible corporate citizen continued its concern for poor and
needy. Be it fire victims, earthquake victims, disabled or patients with serious
ailments who have no means to fall back upon for their survival, the Bank
continued its support and help to them. The Bank continued to adopt orphans by
providing financial support to orphanage homes, and donating computer systems
to enable the socially / economically deprived children to acquire IT knowledge.
During the year a three days rehabilitation camp for physically disabled persons
was organized by the Bank in association with Bhagwan Mahaveer Viklang
Sahayata Samiti, Jaipur where 210 persons were provided with artificial limbs and
appropriate treatment to many more.
Rating of Bank’s Debt Instrument
The Credit Rating Information Services of India Ltd (CRSIL) one of the
leading credit rating agency of the country re-affirmed "P1+" rating to the
Bank’s Certificate of Deposit Programme, indicating the highest degree of
safety for timely payment of principal and interest.
22
BANKING PRODUCTS
There are over 300 products already in market, some of them are listed below:-
1. Deposit schemes
2. Term Deposit schemes
3. Value Added Schemes
4. Current Accounts holders schemes
5. Loans / Advances
6. Automobile Finance
7. Agricultural schemes
8. Services
9. Insurance
10. Finance schemes
11. Mutual funds
23
Some of them are described below:-
Deposit schemes
Knowing the human behavior with respect to wants and needs or rather making wants to
be felt as need is first challenge in marketing the bank schemes. The second challenge is
the resistance to change and / or new ideas, which becomes a tough barrier in the process
of marketing products / service of a bank. Therefore Banks,, tailor their various deposited
schemes and market them to either their / existing customer are the new segments of the
customer. Before selling the deposited schemes, it becomes necessary to identify the need
and aspirations of the customer to make the most ideal and acceptable to satisfy their
needs
From the marketing angle the different deposited schemes of the bank can grouped on the
basis of;
A. The mode of deposited,
B. The mode of repayment
C. Additional benefits
D. The end use of accumulated funds
E. The calculation and payment of interest
F. Need for liquidity, safety, growth etc.
The Jammu and Kashmir bank ltd. has always inclination to launch new deposited
schemes /Products depending upon the market condition and requirement of customers.
The schemes are tailored to suit every body’s requirements.
24
1. Saving bank deposit schemes:
A convenient and easy to operate that helps the customers to save both time and
money; this scheme suits the person who does not have a regular income. Any
deposited and any time withdrawal is the main feature of this scheme. Saving bank
account can e opened with a minimum initial deposit of Rs. 100 - Rs. 582.
The deposited scheme can be opened by:
A. A person is his / her name
B. More than one person in their joint names,
C. Minor through guardian or himself if above 10 of age.
D. A Illiterate persons
E. Blind persons.
F. Association, clubs, societies, trust etc.
Facilities
 Anywhere banking facility.

 ATM/Debit card.
 Tele banking facility.
 Cheque book facility.
25
2. Fixed deposit schemes
It is a term that pays interest at the end of each colander quarter. The fixed deposited
scheme is suited to the persons who wish to keep their invested money in fact and require
quarterly income to meet their requirements. It can open with a deposited of Rs. 100 and
above for different maturities ranging from 7 days to 10 years.
Salient features
Up to 90 per cent of the amount deposited with the Bank. (Conditions Apply)
Who can open this Account?
 A person in his/her name. More than one person in their joint names. Minor
through guardian or himself if above 14 years of age. Blind Persons, Associations,
Clubs, Societies, Trusts etc.
Loan Facility
Ideal product for short-term investors. Interest accrued on quarterly basis, but
payable at maturity of the deposit.
 Can be opened with Rs.100/= and above for different maturities ranging from 7
days to 10 years.
Loans / advances:
Like the deposit account is lifeblood or raw material for the bank, the advances / loans
are essentials to deploy those funds to earn revenue for the bank. In order to balance
liquidity and profitability properly, bank has to use its available (loan able) funds
judiciously keeping in mind the statutory requirements imposed by RBI.
26
1. Housing finance Loan
Quantum of loan
 For Construction /Purchase 60 months net salary or 75.00 Lakhs whichever is

lower.
 For repairs/renovation 20 months net salary, subject to a maximum of Rs.10.00
Lakhs.
 For purchase of land: 20 months net salary/income subject to maximum of Rs.5
Lakhs within J&K and Rs10.00 Lakhs outside J&K.
 Also as an incentive for small borrowers, the loans up to Rs. 1.5 Lakhs granted for
repairs/renovations of existing houses would now be secured by third party
guarantee of two persons or such other security as is deemed appropriate by the
Bank.
Eligibility
 Employees of Govt., Semi-Govt. Dept., Civic Bodies, PSU's with minimum 5

years service.
 Reputed Businessmen with minimum 5 years standing.
 Professionals & Self employed like Doctors ,Engineers , CA's , Advocates with
minimum 5 years standing
Security
 Mortgage of the house/property to be purchased/ constructed.

 Third party guarantee of one person or Assignment of LIC policies, pledge of
govt. securities etc.
 Negative lien on the property to be repaired/renovated without mortgaging the
same to the Bank.
27
Repayment
 For construction of new house 20 years including 9 months moratorium in equal

monthly installments.(Applicable to new loans and disbursements only)
 For addition / Renovation 7 years including 2 months moratorium in equal
monthly Installments.
Margin
 15% for construction/purchase of built house flat.

 20% for renovation/purchase of land.
Processing charges
0.25% of loan amount
2. Educational loan scheme
Scale of Finance
 Rs.10.00 Lakhs for studies in India.

 Rs.20.00 Lakhs for studies abroad.
Courses Financed
 Graduate / Courses in: BA, B.Com. B.Sc., etc. Medicine, Surgery, Engineering,
Hotel Management, Design, Architecture, Biochemistry, Agriculture, Veterinary
etc.
 P.G Courses in: Business Management, Chartered or Cost Accounting, Company

Secretary Ship, Masters PhD.
 Professional Courses: Engineering, Medical, Agriculture, Veterinary, Law,
Dental, Management, Computer etc. Computer Certificate Courses: of reputed
institutes accredited to Dept. of Electronics or institutes affiliated to university.
28
 Courses like ICWA, CA, CFA etc. Courses Conducted by IIM, IIT, IISc, XLRI.
NIFT etc.
Services:
1. Credit Card:
Plastic money or credit cards have become very popular as bank’s product/ services and
have widely acceptance in Indian market. The credit card allows a holder to make
purchases ( up to his sanctions credit limit) without making purchases in lending shops/
markets to make payments of bills – electricity or telephone or a with\draw funds ( cash
up to pre decided limit ) as and when required. The bank launched its credit card, a long
awaited product in association with MasterCard. The J & K Bank Credit Card has three
specifications Gold, Silver and Blue. The product would not only facilitate bank’s
customers but would also be instrumental in giving fillip to the bank’s non interest
income.
2. Internet Banking:
The bank has internet banking service, which is available to the customers of the CBS
offices of the bank. To begin with, the internet banking facility is available for non –
financial transactions only and would be thrown open for financial transactions after RBI
approval, for which all formalities have been completed.
The bank added one more feather to its cap by introducing Mobile ATM service at
Srinagar. The service one of its kinds in the northern part of the country acts as another
delivery channel of services to our customers.
Features
 20-50 day Credit Free Period

 Revolving Credit Facility on paying of minimum payment due in the same billing
period.
29
 Hassle free credit facility at competitive rate of interest.

 Cash Withdrawal Facility up to 20% of total credit limit.
 Loyalty programme
3. Automated Teller Machines (ATM)
These were introduced in UK in the form of cash dispensary by BARCLAYS BANK in

1968. The main objectives of the distribution facility were to save costs and staff and to
provide greater customer convenience ( i.e. Service outside normal banking hours.)
Support services
Technology application has remained the thrust area of the Bank for last many years with
an objective to offer state of the art world class banking facilities to its customers. The
Bank continued to leverage information technology as a strategic tool for its business
operations, to gain competitive edge in customer service as well as improving
productivity and efficiency. The Bank’s IT strategy emphasizes enhanced level of
customer services through 24x7 availability, multi-channel Banking and cost efficiency
through optimal use of electronic channels, wider market reach and opportunities for
cross-selling. The Bank’s focus is on harnessing technology for integrating diverse
products and services. Keeping this in view, the Bank continued to widen the scope of
multiple delivery channels such as ATM installations, Anywhere Banking, Internet
Banking and SMS Banking at more & more centers.
 Anywhere Banking & Internet Banking

 Corporate Internet Banking
 Ecommerce facility for J&K Bank E - banking customers
 E - Payment of Tax for J&K Bank E - banking customers
 SMS Banking
30
 ATM Services Debit Cards

 Debit Cards
 National Electronic Fund Transfer (NEFT)
All the above products are available to all the sections of the society, be it individuals,
households, commercial enterprises, large corporations, manufacturers, retailers, etc.
There are no restrictions to anybody provided proper documents are provided to the bank.
These schemes are provide to weaker sections of society with some relaxation also in
terms of interest rates or repayment period.
31
COMPETITOR
The major competitors in state of J & K are:-State Bank of India, Punjab National Bank,
Canara Bank, HDFC, and ICICI. SBI, Punjab National Bank and Canara Bank were from
the earlier phase but recent entering of HDFC and ICICI Banks has increased in
competition.
1. State Bank of India (SBI)
It is a large financial services group, operating in the banking industry. The bank is
engaged in providing trading services, international banking and traditional banking and
treasury operations. The Reserve Bank of India holds more than half of SBI's equity
capital. As of 31 March, 2010, SBI had a network of over 11,448 branches. In addition,
the seven associate banks of SBI have more than 4,900 branches. As of March 2010, the
bank had 84 foreign branches. The bank also increased its ATM network by 44% to 8,581
by the end of Fiscal year 2010.The bank also offers treasury services including
international banking, corporate banking, retail banking, NRI services, agricultural
banking, small and medium enterprise (SME) banking and other services. SBI conducts it
activities through two reportable segments, namely, Banking Operations and Treasury
Operations.SBI, along with its subsidiaries, is engaged in providing a wide range of
financial services including Life Insurance, Merchant Banking, Mutual Funds, Credit
Card and Factoring, Security trading and primary dealership in the Money Market. The
bank is headquartered in Mumbai, India.
The company reported revenues of (Rupee) INR 916,670.10 million during the fiscal year
ended March 2010, an increase of 28.21% over 2009. The operating profit of the
company was INR 290,405.50 million during the fiscal year 2010, an increase of 23.31%
over 2009. The net profit of the company was INR 109,552.80 million during the fiscal
year 2010, an increase of 22.26% over 2009.
32
2. Canara Bank (Canara Bank)
It is a banking service provider engaged in commercial and personal banking, and

financial services. The bank offers a range of products and services, including savings,
current, fixed, and recurring deposits, as well as term deposits and other deposit products,
and loans and advances, including personal loans, loans for traders, agricultural loans,
export finance, housing loans, and other loans. The bank also provides non-resident
banking services, rural and social banking services and international banking services.
Canara Bank has a network of 2,710 branches in India. Canara Bank provides IT-based
services, with 100% computerization of the branches. The bank provides a wide array of
services, such as, Networked ATMs, Anywhere Banking, Telebanking, Remote Access
Terminals Internet & Mobile Banking, Debit Card, etc. The bank is headquartered in
Bangalore, India and employs 45,260 people.
3. Bank of Baroda (BOB)
It is a leading financial institution in India. The bank is engaged in providing financial

products and services including personal banking, corporate banking, international
business, treasury banking and rural banking. It offers credit cards, debit card, deposits,
retail loans, lockers and other services through Personal banking segment. Business
banking comprises deposits, loans & advances, services and lockers. Corporate banking
includes cash management and remittances, muti-city cheques, appraisals and merchant
banking. International business includes correspondent banking, export finance, import
finance, international treasury and other solutions. Treasury banking comprises domestic
operations and forex operations. Rural banking includes retail loan, small businesses and
small scale industries. The bank operates internationally with its branches and associates
in 25 countries. The bank is headquartered at Vadodara, India.
The bank reported interest income of (Rupee) INR 155,475.61 million during the fiscal
year ended March 2010, an increase of 27.81% over 2009. The net interest income after
loan loss provision of the bank was INR 50,558.82 million during the fiscal year 2010, an
33
increase of 43.42% over 2009. The net profit of the bank was INR 23,840.79 million
during the fiscal year 2010, an increase of 53.97% over 2009.
4. ICICI Bank Limited
(ICICI Bank) is an India-based banking company. ICICI Bank provides banking

products and financial services in the areas of investment banking, venture capital, life
and non-life insurance, and asset management to corporate and retail clients. The bank
offers fixed deposits, savings accounts, recurring deposits, security deposits, child
education plans, salary accounts, EEFC accounts, and resident foreign currency
accounts; and consumer and commercial cards. It also provides home loans, commercial
business loans, automobile loans, two wheeler loans, personal loans, and credit cards. In
addition, the bank provides dematerialization services, NRI services and online services.
ICICI Bank operates through a wide network of 1,449 branches and 4,721 ATMs across
India.
The company reported revenues of (Rupee) INR 362,507.06 million during the fiscal year
ended March 2010, an increase of 6.32% over 2009. The operating profit of the company
was INR 97,634.54 million during the fiscal year 2010, an increase of 17.24% over 2009.
The net profit of the company was INR 35,769.50 million during the fiscal year 2010, an
increase of 5.26% over 2009.
34
CHAPTER 3
ORGANIZATION
STRUCTURE
35
ORGANIZATIONAL HIERARCHY
Chart no. 6.1
Organizational Hierarchy
OFFICES
OFF ICES
BRANCH
H EAD
ZON AL
TER
632-
CLUS
36
Corporate governance
J&K Bank has been committed to all the basic tenets of good Corporate Governance well
before the Securities and Exchange Board of India and the Stock Exchanges pursuant to
Clause 49 of the Listing Agreement mandated these. In line with the vision, J&K Bank
wants to use Corporate Governance innovatively in a transitional economy like Jammu
and Kashmir. The Bank wants to use Corporate Governance as an instrument of
economic and social transformation. In due course, we would set our self- targets of
social and economic reporting as a part of annual disclosures. This will help us
conceptualize and contextualize the form and content of Corporate Governance in a
developing state. Given the fact that J & K Bank is and is seen as a great success of
“public-private partnership”, our Bank as a business is expected to play a role in social
transformation of the economy. This lends urgency to implementation of good
governance practices which go beyond the Corporate Governance code. Operating in an
environment that is emerging from a situation of civil strife, the issue of Corporate
Governance assumes a different and greater relevance. The prime corporation of Jammu
and Kashmir, have a vested interest in making the state a safe place for business. J&K
Bank has a key role to play in providing public and private services, financial
infrastructure and employment. As such, the efficiency and accountability of the
corporation is a matter of both private and public interest and governance, therefore,
comes at the top of the agenda. The fact that the bank is state owned but professionally
managed, having a large size of international investors, governance is critical. For us,
Corporate Governance is concerned with the systems of laws, regulations and practices,
which will promote enterprise, ensure accountability and trigger performance. The J&K
Bank, for one, stands for being more accountable, practice self-policing and make
financial transactions transparent and constitutional.
Board of Directors
37
The responsibility for good governance rests on the Corporate Board which has the
primary duty of ensuring that the principles Of Corporate Governance, both as imbibed in
law and regulations and those expected by stakeholders, are religiously and voluntarily
complied with and the stake holder’s interests are kept at utmost high level.
Name of The Board of Directors
1. Haseeb A Drabu Chairman & C.E.O

2. M.S.Verma Director
3. G.P.Gupta Director
4. B.B.Vyas Director
5. Abdul RaufFazili Executive Director
6. Mustaq Ahmad Executive Director
7. Mohd. Yaseen Mir Director
8. B.L.Dogra Director
9.Umar KhurshidTramboo Director
Composition
The Bank’s Board of Directors comprises a judicious mix of executive, non-executive
and independent Directors as per Corporate Governance requirements. Appreciating the
fact that Board Composition is key to Corporate Governance, the Board of Directors of
your Bank consists of eminent persons with considerable professional experience and
expertise in Banking, Finance, Economics, Industry, Law etc., combining their wide
ranging experiences to impart values and provide direction to Bank’s development. Your
Board is professional and an active Board which meets frequently during the year to chart
out policies and practices. The Assent strength of the Board is seven comprising of
Chairman, two Executive Directors and four Non-Executive Directors.
38
Committees of the board

The Board of Directors of your Company has constituted several Committees of Board to
take decisions on matters requiring special focus. The role and functions of the main
Committees of the Board is described hereunder:
 AUDIT COMMITTEE
 INTEGRATED RISK MANAGEMENT COMMITTEE
 COMPENSATION COMMITTEE
 SHAREHOLDERS / INVESTORS GRIEVANCE COMMITTEE
 MONITORING OF LARGE VALUE FRAUDS COMMITTEE
 SHARE TRANSFER COMMITTEE
39
U
C
E
X
M
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A
R
G
V
I
T
A
H
N
C
M
O
W
U
X
T
C
E
R
I
D
V
S
S
M
V
G
N
A
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C
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B
A
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C
E
R
I
F
S
P
D
R
N
E
T
I
S
CMRIMS (Autonomous)
Chart no.6.2
Organizational structure of Jammu and Kashmir bank:
Chart no. 6.3
40
The J&K Bank Ltd.
IV
X
E
N
B
A
S
T
R
U
C
O
G
K
D
Organizational structure of the offices of the jammu and kashmir bank:
Chart no. 6.4
41
Work structure of the Jammu and Kashmir Bank:
CHAPTER 4
The lowest working units of the Bank are branches also called as Business Units. The
next level of working is done in Cluster Head Offices which are set up district wise. After
FUNCTION OF
that come Zonal Offices which are set up for some states & then at last comes the Head
Quarter called Corporate Office which spearheads the overall working of the bank.
DEPARTMENTS
42
DEPARTMENTS
There are three main departments of the bank :-
Marketing, Finance and Human Resources.
43
Under corporate headquarters there are other departmental offices all over India.
a) Strategy and business development

b) Finance and risk management
c) Inspection & Vigilance
d) Stationary
e) Customer care & Information
f) Law
g) Trainings
h) Credit
i) Offices
j) Security
k) Advertisement
l) Discipline
m) Taxation
n) Human resource department
o) Integrated risk management
p) Foreign exchange
q) Information technology and information systems
r) Advance and asset planning
s) Asset value management
The chairman cum managing director, who is nominated by the Jammu and Kashmir
Government, heads the organization. The board of Directors assist the chairman in
undertaking some important decisions. As on 31.03.2010 there were 9 members
functioning as board of directors.
Departments of the J & K Bank
The Bank J & K bank is a diverse and complex organization. The bank’s main
departments are described below:
a) Audit
44
b) Banking operations
c) Communications
d) Corporate services
e) Debt administration
f) Executive and legal services
g) Financial markets
h) Financial services
i) Monetary and financial services
j) Research
Audit – It is responsible for conducting independent and objective appraisals that

examine and evaluate bank operations.
Banking operations – There are three key players in the bank’s core functions which are
currency, financial systems and funds management.
Communications – communications helps the bank to meet its commitment to openness

and transparency and public relations.
Corporate services – Comprises the following services area: human Resources,

information Technology, marketing, knowledge and information, facilities and protective
services.
Debt administration - Ensures the delivery of cost – effective back – office operations
and provides policy advice
Executive and legal services – Supports the bank’s management by providing decision –
support functions to be executive and to the board of directors.
Financial markets – Functions include implementing monetary policy, managing the

federal government’s cash balances and foreign exchange reserves.
Financial services – Responsible for the accounting and financial reporting of the bank.
45
Monetary and Financial analysis – Monitors and carries out research on the financial
sector.
Research – Provides the bank is management with high – quality analysis of the
economy and related policy issues and new trends in the market.
Non-business offices:
The Jammu and Kashmir Bank has 4 non-business offices known as regional collection
centers all over India. Normal banking business does not take place here. They mainly
deal with clearance of cheques and drafts. As at certain centers, accumulation of cheques
or drafts become varies in number, thus the need of such offices has arisen. Non-business
offices are under the control of corporate headquarters. Taking into consideration the
increasing nature of foreign exchange business that is taking place in India, The Jammu
and Kashmir Bank has identified and authorized 28 offices at important places to deal
with foreign exchange transactions. Such places are Srinagar, Jammu, Ludhiana, Panipat,
New Delhi, Agra, Noida, Hyderabad, Bangalore, and Chennai. Etc.Co-operate
headquarter of Jammu and Kashmir has three main departments, Marketing, HRD and
finance department. Other departments like vigilance customer service cell etc are
forming a part of co-operate headquarter.
46
Marketing department
As far as central office is concerned marketing and research cell enjoys the key position
among the various departments. The main function of the department is that is formulates
the systems and procedures to be adopted by the bank for smooth running of bank affairs.
The department adopts the systems in consonance with RBI. It receives and studies the
guidelines from different quarters, revises them and circulates them to various ranches for
adoptions. Marketing department of Jammu and Kashmir bank performs various other
functions which are mentioned as below.
 It acts as a liaison office between headquarters and other offices of Jammu and
Kashmir bank. It figures of the procedure and systems to be adopted for smooth
functioning. Marketing department acts as designer of new product and services
adopted by bank from time to time.
 The department is also in charge of formulating the system and procedure to be
followed by the offices for acceptance of taxes. Payment of various kinds of fees
such as examination fee and other related items offered by universities etc are
taken by marketing department.
 It is responsible for fixing service charges and is responsible for monitoring cost
on funds / deposits / services. It formulates rate of interest on deposits with the co-
operation of ALCO.
47
MARKETING STRATEGY USED BY J&K BANK LTD.
A company’s marketing environment consists of the factory and forces that affect the
company’s ability to develop and maintain successful transactions with its target
customers. In the present banking environments strategic marketing approach is needed,
the marketing strategy invariably includes:
1. Identifying customer’s financial needs and wants.

2. Developing appropriate banking services to meet these needs.
3. Pricing for the services so developed.
4. Advertising to promote the services to the existing as well as prospective
customers and the future financial markets.
The marketing strategies on these points developed by J&K Bank are as under.
1. Marketing officers as offices continuously determine the customer’s financial

needs and wants. They employ any suitable approach to get the feedback through
questionnaire, interviews or any other feasible method. They send the report on
consolidating findings with their observations / recommendations to M & R Cell,
corporate headquarters.
2. M & R Cell at central office analyses the feedback received from the marketing
officers for developing banking services / products to meet these needs. Pricing
and promotional aspects are taken into consideration.
3. Marketing research is undertaken by marketing officers at other organizational
Offices on continuous basis. Marketing is a responsibility of these people they
also involve marketing committees also for accomplishing the task. The data can
be collected by any of the methods found feasible by marketing officers.
48
Advertising and Publicity
Advertising and publicity have become backbone of any industrial activity. Advertising,
one of the key ingredients in national economic growth is a forceful tool in molding the
attitudes and behavior of people towards product, ideas and services. It not only presents
ideas, goods, services but also permanent people to respond positively to the advertised
message, in another way, advertising is a method form of non personnel presentation and
promotion of ideas and services. Being a paid form, it helps in introducing a new product
in the market and also helps company in sustaining the market share of the established
product. Advertising builds a positive image of the company to the sell the product or
service. Most often a new product sells because of the company background.
The Jammu and Kashmir bank limited uses advertising not only for image building but
also for molding public support for various kinds of its deposit as well as its loaning
schemes.
Continuous media campaign of the activities of the bank through advertising and
publicity will not only help the bank to sustain its image of being “the only Shining Star
of J & K” but will also improve it further. For advertising and publicity of bank’s image
and products, following things need to be kept in mind.
The bank utilizes the services of following media for advertising and publicity of its
products and services.
 Print Media
 Electronic media ( Radio & Television)
 Innovative Outdoor media.
49
Print media
The print and publication media consists primarily of newspapers and magazines. Since,
these are read basically for news, entertainment and editorial contents, but they carry the
advertising message to a large audience. While newspapers are read for the global,
national and local events of the day, magazines are generally read for interesting stories
and articles and sometimes editorial content.
i) Newspaper is one medium that practically every educated person reads. Since
no medium comes closer to experiencing a sense of community that the daily
newspaper, the Bank easily use this vehicle for carrying its message about
products and services. The display of merchandise in the daily newspaper
advertisements represents a catalogue of the information of which customers
look for necessary guidance as they plan their shopping ach day.
Local newspapers are of immense use as advertising vehicles. As they reach to the length
and breadth of the state.
The bank needs to concentrate more on newspaper medium for most on its advertising,
for following reasons, newspaper reach a vast audience. Newspapers provide an intensive
coverage of certain geographical area. Advertising in newspapers attracts immediate
response.
The bank also generates a more lasting effect on the reader through newspaper
advertisement. Newspapers have daily and yearlong readership so the bank can place its
advertisements at any time during the year. More people than the buyer read newspapers.
ii) Magazine: is a major print medium. They are characterized by readership that
is joined by common life styles or special interest because of this selective
market, magazines is the most popular advertisers. Some of the weakness of
newspapers becomes the strengths of the magazines. If newspapers appeals to
all people in the particular community: the magazines appeals to a particular
people in all kinds of communities. The bank chooses the magazine, which
50
has a maximum number of copies in elicitation and also on its direction on the
target market for the product or service. Under the prevailing competition in
the banking industry the placement of advertisement is directly related to the
extent to which the competitors of the bank are using these magazines.
Electronic media:
It primarily consists of the radio and television, which have a more persuasive influence
than the print media does. Radio and television advertising have similarities as well as
differences.
a) Radio:
Is widely used by the people to listen to music and news, most radio are portable
and are found in most homes and automobiles. Radio listing tends to be an
individual rather than family activity. There are various types of programs that
radio stations specialize in the bank can take advantage of such programs for its
image building and advertising its products or services. Because of its low cost
and continuous availability radio should be favored medium for beaming the J &
K Bank’s products and services to the common masses. The advertising messages
can be easily repeated a number of times as not high cost. The bank devotes a few
percentage of its advertising budget towards the radio. The radio message must be
designed to grab the attention of the target audience merely through the sense of
hearing.
b) Television: has become the dominant media for advertising product. It is one of
the most and effective media for reaching mass audiences. It has the potential for
communicating action, sound, color, emotion, demonstration better than any other
non personal medium. The widespread use of color television has given advertising a
new dimension that gently enhances the visual effects of commercials. Television
commands undivided attention and program dedication of viewers and an eye –
catching commercial is easily noticed thus creating product awareness among TV
viewers. Television has power to reach a great number of people.TV has the unique
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characteristics of the ability to demonstrate the operations and utility of the product.
This makes it the closest medium to personal selling. Even though TV is a very
expensive media in terms of commercials production and airtime, dollar for dollar
the cost per thousand viewers can be very low, given the advantage of sight, sound,
color,
action. Thus the Bank’s names can be established at a very low cost per viewer.
Keeping the high cost of TV advertising in view, the bank beams its product or
service on rare occasions. TV commercial is short lived. It is not possible to look at
the message.
Outdoor advertising:
Outdoor media or out home media is the goose laying the golden egg for the bank, if it is
explored to a full extent. They are cheap, effective, appealing and very spectacular.
Unlike indoor media, where advertisements move to people, mobile people move around
the outdoors. They are more direct and effective because of their visual’s appeal of great
record value. All the commercial outdoor media lend for variety and innovativeness and
that why new and formats emerge including illuminated hoardings, colorful posters, neon
signs of various colors and designs, animated displays, inflammable balloons, sky
writings pictures and car cards etc
One of the major advantages of outdoor advertising is that the message reaches the public
24 hours a day all year long, especially when the sign is illuminated. The message also
has a high frequency rate if it placed as strategic locations since people well see it a
number of times while traveling to work or shopping.
Another advantage is that the messages are useful to outside tourists. Since outdoor signs
are mobile in nature and offer a high level of geographical selectivity, the bank places its
advertising message at strategic locations to reach the maximum target audience.
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 Transit advertising: is also given due consideration as it delivers a message to

potential customers of the bank who use commercial and public transport
facilities such as buses, taxis etc.
 Car cards: big corporate and business houses use these small card type
advertisements for propagation of their business activities and image building
purposes. The bank safely banks propagation of their business activities and
image building purposes. The bank safely banks on these cards for an adv
everlasting impact on the minds of the people about the banks image, its products
and services.
1. Exterior posters these also render a great service in disseminating information

about bank’s activities and services. These posters designed with a visual effect in
multicolor are placed on the outside of the buses, trucks and other means of transport.
2. Special directories, Use of bank calendars and dairies

Directories are valuable source of information for all types of products and
services. Yellow pages and business directories have most common reach. The
bank uses space of popular such directories for its advertising messages. The bank’s
wall calendars and dairies are always in great demand. Almost every home and
business establishment in the state is flooded with bank’s wall calendars. The bank
inserts information about its products and services in calendars and desired reach of
the advertising message is reached. Use of this medium costs nothing to the bank,
as the bank gather information about various deposits and loaning schemes of the
bank and they do not have to visit the offices / offices simply for getting about
these schemes. This definitely improves the customer services of the bank
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3. Advertising agency
Since the promotional processes is going to determine the success or failure of an

organization, the choice of the right advertising agency becomes a matter of prime
importance, the choice of the wrong agency can prove to be very costly.
Publicity:
Publicity is any form of commercially significant new about an organization, physical

good, a service, an idea or a person, published by a mass media that has been paid by a
sponsor to this respect, publicity is free promotion Publicity is very important element in
total promotional and marketing. It has far more credibility than advertising. Publicity has
several advantages over advertising.
54
HUMAN RESOURCE DEPARTMENT
Quality of human resources is the key to competitive strength and performance of an

organization. The bank accords high priority to development of its vital resource HRD –
at all levels. HRM is the process of recruiting, selecting, training, motivating and
maintaining employees of an organizations.HRM being an important activity in any kind
of organizations. With the increased and changing environmental conditions .Jammu and
Kashmir bank is also started giving more careful considerations to the man power aspect
of planning. Jammu and Kashmir believes a famous saying. “A happy employee is a more
productive employee”. Jammu and Kashmir bank as a separate organization and personal
department headed by executed of the scale of president. It realizes that an employee
whose performance is continuously improving is the most valuable asset to an
organization. Jammu and Kashmir attitude to the man power is investment rather cost. the
objective of personal department of Jammu and Kashmir bank Ltd., is to make the best
use of their employee in order to ensure both their personal satisfaction and maximum
returns of bank at the cost of they represent.
The organizational and personal department is reckoned as a primary area

having the way for the bank in its endeavor towards competitive excellence. The bank
has acquired a top slot in the banking industry with a distinction of satisfying of all the
service efficiency criteria norms lay down by the working group of restructuring of weak
public sector bank.
Recruitment and selection
Recruitment means attracting external candidates to fill the positions in the organization.
Selection means offering job to valid and reliable candidates from among those whom
applied for the job it is the first time when prospective employee come in contact with
organization. Like most of the bank Jammu and Kashmir Bank is also follows a common
method of recruiting followed by selection, first of all need for fresh candidates /
employee are identified.
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Next to it comes a type i.e., the type of job, which they are expected to perform. After
identifying the right type and right number of employees required bank approach banking
service recruitment board. The function of requirement and selection are performed by
banking service recruitment board. Competence is the only criteria for selection.
Advertisement for vacancies is published in newspapers with all necessary aspects of jobs
e.g. Level of pay, degree of job security, promotional possibility and the like.
After receiving application form applicants they are called for written test. The rest is
conducted by BSRB prepares a list of successful candidates who qualify the written tests.
These candidates are called then for interview, according to the number jobs for which
they are needed etc. as they mentioned as in the requisition set to them to the bank. All
this is applicable to recruitment and selection of clerk cadre and probationary officer.
Rest of the vacancies is filled through promotion within the department.
In case of recruitment and selection of peon, sweeper and guards, bank approaches
employment exchange. In requisition then number and type is mentioned and accordingly
successful candidates are send to the bank. In case of recruitment and selection of peon,
sweeper and guards, bank approaches employment exchange. In requisition then number
and type in mentioned and accordingly successful candidates are sending to the bank. All
government regulations are strongly adhered to regarding local preference, cast, creed,
and like, special weight age in given to SC/ST and backward classes. Relaxation in age is
given to the ward of ex servicemen of the bank.
Training and development programme
Training is the act of increasing knowledge and skills of the employee for doing a
particular job. Every new incumbent as well as old timers need a regular training because
of rapid changes in technological needs, complexities and growth at present day
enterprises , new educational process etc. the training involves assisting employs to use
more effectively his/her skills, talent and knowledge and expand these and helping him to
a course and say ‘ he is trained’. It is continuous process and is progressively more
searching. It should encourage the trainee to learn to make of their facilities.
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The establishment of their own training center at Srinagar and Jammu has proved a
watershed in grooming the staff members in IT related services. Officer in scale four and
above are identified for advance training programme facilities of reputed institutions like
Bankers Training College (BTC), Mumbai, National Institute of Bank Management
(NIBM), Pune and Noida, Administrative staff college of India (ASCI), Hyderabad and
RBI College of Agriculture Banking, Pune is also invited to interact with the participating
in advance programmers.
Performance appraisal, promotion and transfers
Performance appraisal and promotions go hand in hand. Appraisal is the basis for
determining who is permutable to higher position. It is the integral part of managing and
key to it. The branch head prepares appraisal reports of officers, after receiving
instructions from the head office or regional office. The head office prescribes the
creation fro appraisal. The branch head marks it as excellent, good or satisfactory in the
professionally coded language. It is also known as confidential report. The rating and
other details in the confidential report of the employee are taken into account while
considering his promotion. For higher official method of self appraisal is employed after
deciding for the number and type of vacant posts.
Promotion may be on the basis of seniority track or fast track. Fast track is followed only
in case of grade 2 and grade 3, in the fast track candidate is called for an interview. This
is done to avoid any frustration grew among competent employees. The other method is
seniority track each year prepares a list of Officers in its service showing their names in
the order of their seniority an all India basis containing such other particulars as the bank
may determine. A copy of such list is kept at every branch or office of the banks.
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Car facility
The bank may grant to an officer confirmed in bank service loan for the purpose of car,
subject to some conditions. Car loan is granted up to grade 3.
Reimbursement of petrol up to a certain fixed limit per month is allowed. Bank car is
given to grade 4 and above officers other than those authorized by the board are allowed
the use of the bank car for personal use.
Free residency facility
All officers are entitled as of the right to be provided with free residential facilities by one
bank. The bank granted by the bank depends on the scale of the officer and place of his
posting.
In some big cities and metros the bank has its own apartments. In such cases employee is
allotted apartment and no separate rent is given.
Medical aid
An officer is eligible for reimbursement of medical expenses actually incurred by him in

respect of himself or his family, depending on the grade and pay scale. For this facility,
the employee needs to submit declaration every year.
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FINANCE DEPARTMENT
Finance is the science of funds management. The general areas of finance are business
finance, personal finance, and public finance. Finance includes saving money and often
includes lending money. The field of finance deals with the concepts of time, money, and
risk and how they are interrelated. It also deals with how money is spent and budgeted.
One aspect of finance is through individuals and business organizations, which deposit
money in a bank. The bank then lends the money out to other individuals or corporations
for consumption or investment, and charges interest on the loans.
Loans have become increasingly packaged for resale, meaning that an investor buys the
loan (debt) from a bank or directly from a corporation. Bonds are debt instruments sold to
investors for organizations such as companies, governments or charities. The investor can
then hold the debt and collect the interest or sell the debt on a secondary market. Banks
are the main facilitators of funding through the provision of credit, although private
equity, mutual funds, hedge funds, and other organizations have become important as
they invest in various forms of debt. Financial assets, known as investments, are
financially managed with careful attention to financial risk management to control
financial risk. Financial instruments allow many forms of securitized assets to be traded
on securities exchanges such as stock exchanges, including debt such as bonds as well as
equity in publicly traded corporations.
Central banks, such as the Federal Reserve System banks in the United States and Bank
of England in the United Kingdom, are strong players in public finance, acting as lenders
of last resort as well as strong influences on monetary and credit conditions in the
economy.
An entity whose income exceeds its expenditure can lend or invest the excess income. On
the other hand, an entity whose income is less than its expenditure can raise capital by
borrowing or selling equity claims, decreasing its expenses, or increasing its income. The
lender can find a borrower, a financial intermediary such as a bank, or buy notes or bonds
59
in the bond market. The lender receives interest, the borrower pays a higher interest than
the lender receives, and the financial intermediary earns the difference for arranging the
loan.
A bank aggregates the activities of many borrowers and lenders. A bank accepts deposits
from lenders, on which it pays interest. The bank then lends these deposits to borrowers.
Banks allow borrowers and lenders, of different sizes, to coordinate their activity.
Finance is used by individuals (personal finance), by governments (public finance), by

businesses (corporate finance) and by a wide variety of other organizations, including
schools and non-profit organizations. In general, the goals of each of the above activities
are achieved through the use of appropriate financial instruments and methodologies,
with consideration to their institutional setting.
Finance is one of the most important aspects of business management. Without proper
financial planning a new enterprise is unlikely to be successful. Managing money (a
liquid asset) is essential to ensure a secure future, both for an individual and for an
organization.
In corporate finance, a company's capital structure is the mix of financing methods it uses
to raise funds. One method is debt financing, which includes bank loans and bond sales.
Another method is equity financing - the sale of stock by a company to investors.

Possession of the stock gives the investor part ownership in that company, in proportion
to the number of shares the investor owns. In return for the stock, the company receives
cash, which it may use to expand its business or to reduce its debt.
The investors, in both bonds and stock, may be institutional investors - financial
institutions such as investment banks and pension funds - or private individuals, called
private investors or retail investors.
Personal finance
Questions in personal finance revolve around
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 How much money will be needed by an individual (or by a family), and when?
 Where will this money come from, and how?
 How can people protect themselves against unforeseen personal events, as well as
those in the external economy?
 How can family assets best be transferred across generations (bequests and
inheritance)?
 How does tax policy (tax subsidies or penalties) affect personal financial
decisions?
 How does credit affect an individual's financial standing?
 How can one plan for a secure financial future in an environment of economic
instability?
Personal financial decisions may involve paying for education, financing durable goods
such as real estate and cars, buying insurance, e.g. health and property insurance,
investing and saving for retirement.
Personal financial decisions may also involve paying for a loan, or debt obligations.
Corporate finance
Managerial or corporate finance is the task of providing the funds for a corporation's
activities. For small business, this is referred to as SME finance (Small and Medium
Enterprises). It generally involves balancing risk and profitability, while attempting to
maximize an entity's wealth and the value of its stock.
Long term funds are provided by ownership equity and long-term credit, often in the
form of bonds. The balance between these elements forms the company's capital
structure. Short-term funding or working capital is mostly provided by banks extending a
line of credit.
Another business decision concerning finance is investment, or fund management. An

investment is an acquisition of an asset in the hope that it will maintain or increase its
61
value. In investment management – in choosing a portfolio – one has to decide what, how
much and when to invest. To do this, a company must:
 Identify relevant objectives and constraints: institution or individual goals, time

horizon, risk aversion and tax considerations;
 Identify the appropriate strategy: active v. passive – hedging strategy
 Measure the portfolio performance
Financial management is duplicate with the financial function of the Accounting

profession. However, financial accounting is more concerned with the reporting of
historical financial information, while the financial decision is directed toward the future
of the firm.
The Finance Department of J & K Bank performs a lot of functions. Being a financial
institution it mostly deals with financing, so it has a lot if financial aspects. The Finance
Department is present in every Business Unit (branch) of the bank. It deals with finance
right from small branches to Corporate Head Office.
The branches are divided into different categories depending upon the volume of their
business. These categories are A, B & C categories. Branches having high volume of
business come under category A & the branches having low volumes of business come
under category C. The branches having average type of business come under category B.
there are even some loss making branches but the bank has not shut them due to
Corporate Social Responsibility factor.
The powers of category A branch managers are higher than the powers of category C
branch managers in respect of sanctioning finances to individuals or corporate. The
branch managers have powers of issuing more finances in case of mortgage than in case
of third party. In case of mortgage finances the value of underlying mortgage should be
more than 100% of the value of finance. Smaller amounts upto certain extent is provided
by branch manager under the powers vested in him. After that the next authority for
sanctioning the finances are cluster head offices, after that come zonal offices & the still
higher amounts are sanctioned in Corporate Head Quarters. Amounts upto five crore are
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sanctioned by various offices up to zonal level. But when the amount exceeds five Crores
it is referred to the Finance Department of the Corporate Head Quarters.
The overall Finance Department of the Corporate Head Quarters is first divided into
Retail Finance Department & Corporate Finance Department. Retail Finance Department
deals with the financing of retailers, big shop outlets, etc while as the Corporate Finance
Department deals with the financing of large corporate & manufacturing units.
Earlier the strategy of the Finance Department was to provide huge finances to big
corporate mainly outside Kashmir but now the strategy has changed & the small firms in
Kashmir are being provided with financial help so that the economy of Kashmir will
develop.
The Finance Department of Corporate Head Quarters has three sub-departments so that
the work is divided & done effectively & efficiently. These departments are:
Advances & Asset Planning Department
Follow-up Department
Supervision & Control Department
The work of the Advances & Asset Planning Department is to scrutinize the party & its
documents to check whether it is eligible for the sanction of finances or not. The
department scrutinizes the profile of the party, project report & estimated profits,
reliability of the project & estimated cash inflows & outflows.
After scrutinizing all these things this department decides whether the party is eligible for
finance & the amount up to which the bank can finance it.
Follow-up Department keeps an eye on the working of the establishments which are
financed by the bank. On the basis of the returns & other documents which the financed
establishment provides to the bank, it decides in which direction it is going & provides
warning signals if any. If any financed establishment or any other asset doesn’t provide
any return for the period of 90 days it is put in the category of nonperforming assets
(NPA). This department provides the information to Supervision & Control Department.
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Supervision & Control Department supervises the functioning of the financed

establishment. It takes note of the information & warning signals provided by the Follow-
up Department & then acts & also asks the financed establishment to act accordingly.
This department also conducts audits to check the working of the financed establishments
& also the various branches of the bank. A number of audits are conducted. These
include daily concurrent audits, monthly audits, quarterly audits, six monthly audits,
yearly audits & one yearly audit by RBI.
The bank also has its agents in Money Market to maintain the proper liquidity position so
that it meets any shortfall of cash at any point of time.
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OFFICE MANAGEMENT
Every game has its own rules and methods and when these are followed it becomes as
organized game. In the same manner the work to be done in an office cannot be left to a
group of individuals. With the rapidly mounting volume of office work being alone and
the equally rapid increase in the number of office workers required. J & K also realizes
the importance of effective office management. Management of an office is quite as
important job as the management of a factory or any other industrial enterprise. First, to
ensure that the work is done quickly. Second, to eliminate unnecessary work which
causes delays and increase expenses without justification. So office activities must be
properly arranged, which cause and increase expenses without justification.
Furnishing and layout
Office layout refers to the arrangement and placing of men, materials, furniture and
equipment within each section or department of the office in such a way that the
utilization of space is done in the best possible manner. In all the offices the office layout
is more or less same. The branch is furnished and all articles are maintained in good
condition and are adequately insured against fire and other risks. Items such are
computers are regularly and properly serviced and maintained in perfect working
condition. All the items of fixture and furniture are properly entered in the inventory
register and numbers given in the register are printed / embossed on the concerned items.
The cash safe and cashier’s cabin is kept separate for the purpose of security. Strong
room is generally underground. In most offices direct type of lightning is used. Electric
generators are placed on the flooring and also floor of the offices to reduce the sound of
footstep.
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Safety and security
All possible steps are in force with regard to safety and security. There is a proper
arrangement of word and watch of the premises. It is ensured that that the gun license is
in order. The guns and store of cartridges are periodically examined by the competent
persons to ensure their working conditions. So fire fighting equipments are also
maintained properly and tested periodically. There are multiple exits incase of fire.
Adequate insurance coverage is obtained on almost everything. Records are protected
from white ants. Almost all offices are guarded by police force of the state. Mo doubt
bank has employed its own – armed guards for the purpose of security.
Cash management
Cash is in joint custody of head cashier and manager. The keys of grill gate are in
the joint custody of head cashier and manager. Requisite cash is placed at the counter in a
cash box and surplus or excess cash s kept in reserve in the safe. Whenever any
withdrawal or deposit is made the cash held in the reserve. The same is recorded in the
cash reserve register. Which shows the running balance of the ash in the safe from time to
time? At the time of close of business the balance is shown in the cash reserve register
should agree with the cash tallied book. The cash reserve register is with the manager
during the day and overnight it is kept in the store room.
Office correspondence
Office correspondence is mainly through UPC, registered post and courier service. Other
mode of correspondence is fax machines, internet. All outward and inward mail is
entered in suitable registers. Every time two copies of circular are mailed to the offices.
Out of these original one is filed in the master file and other is communicated to
concerned employee. All letters are received are opened by or in the presence of
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authorized officials and are branded immediately with the data stamp. All these letters
cover cheques; bills etc are distributed to the officers.
Maintenance, preservation and destruction of records
Records means written papers, documents, statements, invoices vouchers,

correspondence, books of accounts, concerning an organization. Record management
refers to the activities designed to control the life cycle of a record from the creation to its
ultimate destination. The banking being a service industry has to deal with innumerable
customers, which involves a lot of paper work and as Such accumulation of record of
each transaction is evitable. The period of keeping records depends upon nature of the
record. The old / obsolete records create bottlenecks, obstruct workflow consume
valuable space and give an ugly look. Hence there is a need for having a system for
maintenance, preservation and destruction of old to bring about operational efficiency at
the offices and every branch has supplied with booklet regarding maintenance and
destruction of old records.
Maintenance of current records
A current means all running records that are to be kept forever. In branch keeping
is under the supervision of a senior clerk / officer, who is assigned the duty of
maintenance of proper records. The files are indexed chronologically. For closed /
completed files, its date of commencement, the description of the file and date of
completion is recorded on its cover. This is noted in the file index register.
Preservation of old records
All records are not required for current use but are required in future are included under
this category. In case completed / closed ledgers, sheets are taken out as usual from the
binders and got rebound with hard cloth binding. All items of records are kept free from
67
dust. All the records which are required to be preserved are pasted with labels on the
thick side of the book vertically containing particulars as name of the branch, no. etc.
FUNCTIONS OF VARIOUS OTHER DEPARTMENTS
Investment department: this is one of the important departments of the Jammu and
Kashmir Bank. It is headed by a President and comprises of officers also. This
department is concerned with the management of cash to meet short term and long term
requirements. It controls and allocates the financial resources to different units to ensure
their optimum utilization. It also comprises of Economic and Planning Cell, Financial
Reporting Cell
Inspection and vigilance department
This department is prescribed by the executive manager inspection and executive

manager vigilance. It investigation and vigilance department checks the working of
different offices. The department comprises the following:-
Enquiry cell -conducts enquires regarding the charges leveled against the officials of the
bank
Revenue audit cell checks the revenue i.e., income and expenditure of the offices and
sees that if there is any revenue leakage
Customer service cell looks in to the complaints lodged by the customers against the
officials of the bank.
Disciplinary department This department is presided over by a executive manager.
Law department This department of the bank is over looked by three president. At Delhi
zone, corporate Headquarters, Srinagar and Jammu zone. It sues in the court of law
68
against the borrowers if they fail to pay back the amount that has been advanced to them.
It also represents J & K Bank in the court of law against any sues whatsoever.
Advanced department
Advances or granting loans is one of the main functions of any bank. A bank gives
money on credit to its customers and charges interest which accounts for a substantial
portion of its profit.
Computer policy and planning department
The main function of this department is to develop policies and plans and
computerization of offices of the bank. The computers engineers working in this
department also work for the customization of various applications purchased from the
market and also develop software for various departments of the bank
Foreign exchange department
It deals with the foreign business of the bank. It conveys the rates of foreign currencies to
the office of the bank.
Stationery department and Estates department
It looks for premises of offices for the bank. It also arranges furniture and fixture
for offices. It has to arrange and supply the required stationary items to the bank. The
department interacts with the various printing presses and other ailed supply agencies to
fulfill the needs of the bank.
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CHAPTER 5
SWOT ANALYSIS
70
SWOT ANALYSIS
Strengths
 A listed Company of the state on BSE and NSE.

 Fastest growing bank in India with 632 Offices spread across in the country.
 Four decades of un–interrupted profitability and dividends.
 Internet banking.
 Tele banking, anywhere banking, sms and mobile banking.
 98.4 % of the total business computerized.
 Banker to the Government of Jammu and Kashmir State.
 Company Owned property.
 Social banking.
Weaknesses
 Less coverage in east and south India.

 Less public savings.
 Improper working of ATM’s.
 Lack of proper approach of Bankers towards the customers.
 Lack of proper performance appraisal system.
Opportunities
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 Continued emphasis on infrastructure facilities.

 Increase business activities particularly in south and east India.
 Taking up newly and big venture projects.
 Making banking activity more simple and fast.
 Innovative financial products.
 Offshore banking.
Threats
 Customer shift to newly established banks and other banks particularly outside J
& K state.
 Better facilities in terms of technology, people and funds.
 Economic liberalization allowed private banks to operate completely, thus forcing
a threat.
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CHAPTER 6
SPECIAL TASK
73
Introduction
The bank takes proper care so that the confidential management related information is not
leaked out to public. During the internship period in the bank I felt that the bank
functions properly & is not having any problem. When I inquired various officials in the
bank in regard to any problem or dilemma faced by the management of the bank, the
bank officials replied there is no such problem at this point of time. Further I was told
that even if there is any problem or dilemma it is not in the rules of the bank to share it
with any outsider.
Taking the above points in consideration, I decided to throw light on the problem which
is not faced by the bank only but by all organizations in the Kashmir Valley. But my
concentration would be more on the bank than on any other organization.
Problem
Regular & long period shutdowns in Kashmir Valley
History
The starting point of these shutdowns dates back to 1930’s when the autocratic Maharaja
Hari Singh of that time signed some document giving accession of Kashmir to India
against the will of the public. In this regard the people of Kashmir assembled to protest
on 13th July 1931 but were brutally killed by army of the Maharaja. Since then 13 th July is
celebrated as Martyr’s Day in Kashmir.
Then in 1947 when India got its independence Kashmir was having threat of war from
Afghans & at that time Indian army was deployed on the borders of Kashmir to protect
against the attack from Afghans. This was just for protection & Indian PM of that time
Mr. Jawaharlal Nehru himself promised Kashmiris that after the period of threat is over
the people of Kashmir will be given choice to decide whether to join India, Pakistan or to
be separate as was decided by United Nations Organization. But that choice was never
provided to Kashmiris. Then in 1989 armed struggle against Indian forces started in
Kashmir due to which India sent more & more forces to Kashmir & took full control of
Kashmir. Even the army & CRPF were deployed in all the interior areas of Kashmir. Day
74
by day many draconian laws like Armed Forces Special Powers Act (AFSPA),
Prevention of Terrorism Act (POTA) and Public Safety Act (PSA) were enforced in
Kashmir which gave special powers to security forces. All these laws lead to Human
Rights violations in Kashmir. When armed struggle failed the pro freedom leaders chose
the non violent way of demanding freedom & revocation of draconian laws. Whenever
any wrong decision was taken by the State Government pro freedom leaders were giving
calls for strikes, civil curfews & march calls. Sometimes when situation goes out of
control of government, it imposes curfew. It is disclosed by survey that since 1990
Kashmir was shut down for four years that is, more than 1300 days.
Impact
Due to these shutdowns the business establishments have suffered great losses including
banks. The bank is not able to run its business due to these shut downs. It has affected the
bank mainly in the following ways:
 The employees are not able to reach the respective offices.

 The bank is not able to collect cash from parties.
 Work is not done on time.
 There is uncertainty about when the particular work will finish.
 Sometimes the protesters destroy the property of the bank e.g. branches, ATM’s,
etc.
 Bank is not able to sanction finance to eligible parties on time.
 Since the shut downs affect the financed establishments also, it has impact on
profitability of the bank as many assets of the bank turn into non performing
assets due to long shut downs.
Sugession
The general solution which is at the hands of the political parties is the revocation of
draconian laws. Acts like AFSPA need to be amended so that there are no human rights
violations so that pro freedom leaders don’t get chances to call for shut downs.
75
The solution in the hands of the management of the bank is to manage the higher
departments virtually i.e. introduce the concept of virtual organization whereby the
employees can take work to their homes & do it there. The bank is more than 95%
computerized now & is using Finacle & intranet facilities. The employees can do their
work well from their homes & upload the information to the server. But this can be done
to higher departments only & not branches because branches deal with public directly.
There is 10 am to 5 pm shift in bank, to overcome the effect of shutdowns the branches
can be thrown open in night shifts because both strikes by pro freedom leaders & curfews
by government come to an end by 7 pm in the evening.
76
CHAPTER 7
FINDINGS, SUGESSIONS
& CONCLUSION
FINDINGS
77
 J & k bank have re-engineered the HR processes. They have replaced the old manual HR
system to centralize the HR information, thus keeping a pace with technology.
 Jammu and Kashmir bank is rated as one of the fastest growing bank in the country with
an increase in profit by 70 % having four decades of un-interrupted profitability and
dividends.
 Only private sector bank designated as agent of RBI for banking.
 More and bigger venture are coming up which are going to result in rise in profit.
 Net Profit up 25 % at Rs 512.38 crore for the financial year ended Mar, 2010 as
compared to Rs 409.84 crore for the previous financial year.
 The Business Turnover as on March 31, 2010 has increased by 12 % to Rs 60294 crore
from Rs 53935 crore as on March 31, 2009.
 Other Income for the current year increased considerably by 70 % to Rs 416.23 crore as
compared to Rs 245.05 crore for the previous financial year, mostly driven by Treasury /
Trading income.
 The Net NPA’s have further decreased to Rs 64.33 crore from 287.51 crore a year ago.
The Gross and Net NPA Ratios have come further down to 1.97 % and 0.28 %
respectively compared to 2.64 % and 1.37 % for the previous financial year.
 The NPA Coverage Ratio at the end of year ended Mar, 2010 improved to 86.09 %
compared to 48.59 % a year ago, well above the RBI stipulated 70 %.
 Investments Portfolio of the Bank as on Mar, 2010 at Rs 13956 crore increasing by 30 %
over last year’s Rs 10736 crore.
 Low cost Demand and Savings Deposits of the Bank as on Mar, 2010 increased to Rs
15153 crore up by 20 % from Rs 12579 crore as on Mar, 2009 taking the CASA ratio up
to 40.69 % from 38.11 % a year ago.
 Cost to Income ratio for the year ended Mar, 2010 has improved to 37.60 % from 37.81
% for the previous financial year.
 EPS and Net Asset Value improved further to Rs 105.69 and Rs 621.00 for the financial
year ended Mar, 2010 from Rs 84.54 and Rs 541.04 for the previous financial year.
78
 For the financial year ended Mar, 2010, the Board of Directors has recommended a
dividend of Rs 106.65 crore as compared to Rs 81.97 crore for the financial year ended
Mar, 2009.
 Since it is aiming at making banking activities more simple and fast, it could result in
increase in customers coming from rural areas.
 Marketing strategy used by bank is one of the best resulting in more publicity and
exposure of bank, thereby attracting customers.
 The bank has recently launched electronic & mobile banking for its customers by which
the customers get SMS’s of their account balances & can also check statement of their
accounts through internet make transactions also.
79
SUGGESTIONS
 As per my study the bank should increase banking activities by creating more and more
branches to encourage more customers. This is evident, as the bank has decreased its
investments in fixed assets. So in order to diversify its business there is an urgent need to
increase its investments in fixed assets.
 With a view to increasing its reach to the potential markets and extending banking
facilities to un–banked areas the bank should look for a good location, market and rival
competition.
 Changing trends in the use of technology in the banking sector should be given
utmost priority.
 Training’s should be imparted to the employees on on–going basis to enhance
their knowledge, efficiency, skills, and competencies.
 Since it has 632 offices across the country, in spite of this it has less coverage in
east and south India. More branches should be opened in this area since east and south
India has good number of potential customer.
 Board members should put more stress towards south India.
 Maintaining the customer should be one of the basic aims and customer’s service
should be given more priority. Customized products can be launched for long term loyal
and profitable parties.
 Function of ATM’s should be improved which result in convenience for banking
activities thereby improving customer satisfactions. This can be done by making the
ATM squad more vigilant.
 Since India is one of the major tourist’s spots of the world more and more offices
should be given foreign remittance, which can result in flow of foreign currency.
 The bank should also mobilize savings in the form of fixed deposits by increasing the rate
of interest; this will help the bank in making more funds which can be later utilized in the
expansion and modernization of the bank.
80
CONCLUSION
The J&K Bank is one of the fastest growing listed banks in the country with more than
632 offices. The new identity has revolutionized J&K Bank and has representation of
the Bank’s philosophy and business strategy. J & k bank have re-engineered the HR
processes and moved a step ahead. It is highly ethical in nature as the bank’s
philosophy is woven around its total commitment to the ethical practices in the conduct
of its business. It is the only private sector bank designated as agent of RBI for bank.
The Jammu and Kashmir Bank has Four decades of uninterrupted profitability and
dividends.
Many competitors have failed to compete with the Bank due to its Quality service. It is
the only social bank of Kashmir.
At last it can be concluded that Jammu and Kashmir Bank is one of the leading banks
of India and its maintaining is profits are growing year by year, but management should
put more stress on customer satisfaction and providing much better facilities in term of
banking activities.
81

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CMRIMS (Autonomous) The J&K Bank Ltd.

Origin of the Word “Bank”

1. It deals with money; it accepts deposits and advances loans.

Precious metals, in weighed quantities, were a common form of money in ancient

Beginning of Issue and Deposits:

Evolution of Modern Banking

Origin of Banking in India

When the American Civil War stopped the supply of cotton to Lancashire from

Foreign banks too started to arrive, particularly in Calcutta, in the 1860s.

followed. HSBC established itself in Bengal in 1869. Calcutta was the most active

The partition of India in 1947 adversely impacted the economies of Punjab and West

 In 1948, the Reserve Bank of India, India's central banking authority, was

The nationalized banks were credited by some; including Home minister P.

In the early 1990s, the then Narsimha Rao government embarked on a policy

Currently (2007), banking in India is generally fairly mature in terms of supply,

Technology driven operations:

implementation of technology. In these difficult times, it is imperative to cut down

The number of offices brought under computerization programme has increased to

 Keep on creating wealth and focus on high earnings and growth.

Mission and strategy:

 To maintain high quality asset and credit risk management.

Unique characteristics: one of a kind

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

Staff & Work environment

 In a landmark move, the J&K Bank had announced an enviable package of

 Transparency, people-oriented policies and a culture of knowledge-sharing is

 The employee-oriented measures would achieve a real competitive advantage

Cashier-cum-Clerks as Assistant Banking Associates and Peons as Banking

Achievements, Recognition and Awards

 J&K Bank was awarded Wisitex ICT Ratan in July 2010.

Corporate social responsibility

The vision of bank is summed up in one word “growth”

 Incorporated in 1938 as a limited company.

 Regulated by the Reserve Bank of India and SEBI.

 Four decades of uninterrupted profitability and dividends.

Performance of the Bank

Previous Annual Reports The Bank continued to make strides in its

Capital & Reserves

Profit The Bank posted a net profit of Rs. 512.8

Turnover The total income of the Bank at Rs. 60294

Dividend In view of the sustained excellent financial

81.97 crore @ 169 % (Rs 16.90 per share)

Lead Responsibility of the Bank

The Bank continued to discharge its Lead Bank Responsibility in 8 out of

Committee meetings (SLBC) and two Subcommittee meetings of State

Rating of Bank’s Debt Instrument

Some of them are described below:-

A. The mode of deposited,

B. The mode of repayment

D. The end use of accumulated funds

E. The calculation and payment of interest

F. Need for liquidity, safety, growth etc.

1. Saving bank deposit schemes:

The deposited scheme can be opened by:

A. A person is his / her name

B. More than one person in their joint names,

C. Minor through guardian or himself if above 10 of age.

F. Association, clubs, societies, trust etc.

 Anywhere banking facility.