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effectiveness of Core Banking _ CORPORATION BANK PROJECT REPORT

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					To Determine the Effectiveness of Core Banking On Cash Flow



                             EXECUTIVE SUMMARY

        The Indian economic is growing. There are various factors contributing for the
development of economy. One of the industries which have revolutnalise the economy is
banking. Change in the IT & faster growth has changed the banking operations to a great
extent. Banking operations have led to a great development of economy & meeting
customer’s needs. Among various sectors that bank is involved, Core Banking is one area that
has changed gradually in meeting dynamic needs of customers.
   COMPANY PROFILE:

   Corporation bank was founded in the year 1906 in Udupi by the founder Mr. khan abdul.

   Its headquarter is at Mangalore, the chairman of the organization is Mr.sambmurthy as a

   key person to the organization. This industry holds banking services and having different

   banking products its present revenue is 110722 crores and net income for the present year

   is 2143.09 crores respectively.


TITLE OF THE PROJECT

“To Determine the Effectiveness of Core Banking On Cash Flow” of corporation bank at
RNR BRANCH.


BACKGROUND OF PROJECT TOPIC

   Since corporation bank at RNR BRANCH has introduced the concept of core banking

   recently. The Management, in this survey wants to find out the growth percentage of cash

   flow by introduction of core banking solutions & also to know the impact of core banking

   on employees & customers of corporation Bank.




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To Determine the Effectiveness of Core Banking On Cash Flow

NEED FOR THE STUDY
Since the research is to determine the effectiveness of core banking solutions

On cash flow statements of corporation bank at RNR BRANCH. Therefore the need for the

study is limited to corporation bank at RNR BRANCH.

 OBJECTIVES OF THE STUDY
        The main objective of the study is to determine the effectiveness of core banking on

         cash flow.

        To know the impact of core banking on employees & customers of corporation Bank.

        To analyze the core banking Activities


LIMITATIONS

1) A sample of 100 customers & 10 employees of the bank were chosen for the purpose of
study.
2) The study was restricted to 4 months.

   3) There were some difficulties when asked for personal details like cell numbers were

       asked.


METHODOLOGY

Data Collection Method
       To fulfill the objectives of my study, I have taken both into considerations viz primary
& secondary data.
Primary Data:

        Primary data was collected through making survey, which is systematic collecting of

         information directly from the respondents i.e. through Questionnaires.

  Secondary Data:

        Secondary data was collected through Organizational records.


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FINDINGS
              Employees of the bank should be given proper training with respect to core
               banking.
              Customers should be educated with respect to all the benefits available with

               the core banking.

              The concept of core banking should be speeded up so that it saves the time of

               employees & customers.


SUGGESTIONS

The project analysis has helped in knowing the satisfaction level of the Employees based on

the analysis it was found that majority of the employees are satisfied, the satisfaction level

could further be increased if the employees are given proper training with respect to core

banking.


CONCLUSION
The study was conducted to understand the effectiveness of core banking cash flow of

corporation bank RNR BRANCH. To serve the state objective of the survey, the response has

been collected from 10 employees & 100 customers of the bank & also an analysis was being

made on cash flow statement of corporation bank for a period of 2 years, which helped in

knowing the growth percentage on cash flow after the introduction of core banking, from the

analysis it was found that there has been an 43% increase on cash flow as compared to

previous years.

RECOMMENDATIONS

All the details with respect to core banking should be displayed at the Counter hall so that the
customers come to know the procedure instead of wasting their time.



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                   INTRODUCTION TO THE TOPIC:




The title of the project report is “To Determine the Effectiveness of Core Banking On
Cash Flow” of corporation bank at RNR BRANCH. Core Banking is normally defined as the
business conducted by a banking institution with its retail and small business customers.
Many banks treat the retail customers as their core banking customers, and have a separate
line of business to manage small businesses. Larger businesses are managed via the
Corporate Banking division of the institution. Core banking basically is depositing and
lending of money. Normal core banking functions will include deposit accounts, loans,
mortgages and payments. Banks make these services available across multiple channels like
ATMs, Internet banking, and branches. Core Banking Solutions is new jargon frequently
used in banking circles of India. The advancement in technology especially internet and
information technology has lead to new way of doing business in banking. The technologies
have cut down time, working simultaneously on different issues and increased efficiency. The
platform where communication technology and information technology are merged to suit
core needs of banking is known as Core Banking Solutions. Here computer software is
developed to perform core operations of banking like recording of transactions, passbook
maintenance, and interest calculations on loans and deposits, customer records, balance of
payments and withdrawal are done. This software is installed at different branches of bank
and then interconnected by means of communication lines like telephones, satellite, internet
etc. It allows the user (customers) to operate accounts from any branch if it has installed core

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To Determine the Effectiveness of Core Banking On Cash Flow

banking solutions. This new platform has changed the way banks are working. Now many
advanced features like regulatory requirements and other specialized services like share
(stock) trading are being provided.As the concept is new its necessary to know the
effectiveness of core banking solutions. As a project handler, we are interested to understand
how the concept works. Core banking is said to be effective, if it is feasible from the view
point of customers and bankers as well. Today in the present scenario, every banking concern
follows the system concepts for its smoothing operation but at the same time the quality of
system operations is equally important. It should be helpful and fit from both the angles. To
measure the effectiveness of core banking solutions the questionnaire was drawn which
contains some question to solicit the information. Everything has been taken into account so
as to conclude with the final results.



NEED FOR THE STUDY

Since the research is to determine the effectiveness of core banking solutions on cash flow

statements of corporation bank at RNR BRANCH. Therefore the need for the study is limited

to corporation bank at RNR BRANCH.

      To know the impact of core banking on employees & customers of corporation Bank.

      To analyze the core banking Activities

      Since corporation bank at RNR BRANCH has introduced the concept of core banking

       recently. The Management, in this survey wants to find out the growth percentage of

       cash flow by introduction of core banking solutions & also to know the impact of core

       banking on employees & customers of corporation Bank.




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                           ORGANIZATION PROFILE



   CORPORATION BANK




   Type                 Public (BSE, NSE:CORPBANK)

   Founded              Udipi, 1906



                        Corporation Bank,
                        CORPORATE OFFICE ,
   Headquarters         Mangaladevi Temple Road
                        Pandeshwar
                        Mangalore 575 001 India



   Key people           Chairman B. Sambamurthy

   Industry             Banking


   Products             Loans, Credit Cards, Savings, Investment vehicles, etc.


   Revenue                Rs 1107.22crore (2008-09)

   Net income             Rs 2,143.09 crore (2008-09)

   Website              http://www.corpbank.com/




                                             :

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                                     BRIEF HISTORY




Established in the year 1906, Corporation Bank is an organization based on the traditional
Indian values of service to the community. Corp Bank is regarded as one of the well-run
banks in the comity of Public Sector Banks in the country. The Bank has a unique history of
100 years of successful Banking and has stood the test of time by growing steadily, offering
vast, varied and versatile services with a personal touch. Today, its good customer service,
pre-eminent track record in House Keeping, adherence to Prudential Accounting norms,
consistent profitability and adoption of modern technology for betterment of customer service
have earned the Bank a place of pride in the Banking Community. The Bank has been richly
endowed with a relatively young, dynamic and efficient manpower, which is the key factor of
the Bank’s success. Excellence in performance and uniqueness in customer service form the
central core of the Bank’s organizational culture. The growing confidence of its clientele is
well reflected in the Bank’s performance in all critical areas of its Operations all through the
year.
The Bank is a Public Sector Unit with 57.17% of Share Capital held by the Government of
India. The Bank came out with its Initial Public Offer (IPO) in October 1997. The Bank’s
Net Worth stood at Rs. 3,374.89 core as on 31.03.2008.




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Corporation Bank (Profile)

    Metro 251 Branches.
    Personal Banking Branch 28.
    Urban & Port Town Branches 230.
    CAPS Branches 10.
    Industrial Finance Branch 6.
    Semi-Urban 181 Branches.
    SSI Branches 4.
    Rural Branches 173        .
    Asset Recovery Branches 5.
    Housing Finance Branches 4.
    Overseas Branches 2.
    Commercial Banking 2.
    NRI Branches 1.
    Service Branches 11.
    Commercial & Personal Banking 66.
    Foreign Exchange Service Br. 1.
    Fast Collection Service 5*.


BRANCH NETWORK

During the financial year 2005-06, 58 branches were opened, thereby taking the number of
branches to 835 as on 31.03.2008, spread over 23 states and 2 union territories. Out of the
above, the numbers of specialized branches are 145.The number of Extension Counters as on
31.03.2008 stood at 53.
      Business growth and branch network expansion Necessitated fresh recruitment to the
     extent of 966 employees during the year. The total staff strength stood at 12465 on 31st
     March, 2009 compared to 12011 in the previous year. 21.2 The staff productivity in the
     Bank increased from Rs.839.19 lakhs as on 31.03.2008 to Rs.1048.86 lakhs as on
     31.03.2009, recording a growth of 24.98%. Net Port per employee increased from
     Rs.4.79 lakhs to Rs.7.64 lakhs during the year.




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         The Bank has been following the guidelines for reservation in employment to speci.ed
         categories. During the year, 82 employees belonging to Scheduled Caste/Scheduled
         Tribe category were promoted to the next higher cadre. The representation of Scheduled
         Caste/Scheduled Tribe employees in the total staff strength was 3166 as on 31.03.2009,
         constituting 25.40% of the total employees.
         The Bank also has a fair representation of other reserved categories. As on 31st
         March, 2009, 1401 Other Backward Communities, 219 Physically Handicapped and
         629 Ex-servicemen were on the rolls of the Bank.


ADVERTISING AND PUBLICITY
The Bank continued to communicate messages on products, services, interest rates and the
performance of the Bank to the customers, shareholders and the general public through mass
media. In order to bring more customers into its fold, the Bank launched various promotional
campaigns during the year.
During the year, concerted efforts were made for brand building and the Bank continued to
communicate messages on its products, services, interest rates and the performance to the
customers, shareholders and the general public through advertisements and outdoor publicity
units.


MARKETING INSURANCE PRODUCTS

Under life insurance, the Bank has mobilized first premium business aggregating to Rs.51.04
Core as against the target of Rs. 40.84 Crore in the previous year. Bank could mobilize
premium under General Insurance aggregating Rs.14.01 Crore. Under Mutual Fund Business,
the bank has mobilized a fund business of Rs. 55 Crore as against the target of Rs. 40 Crore
fixed for just concluded fiscal. As at the end of March, 2008 total number of accounts
outstanding under Corp Jeevan Raksha Scheme and Corp Jeevan Griha Raksha Scheme have
reached a level of 36000 and 3300.




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CUSTOMER SERVICE AND TECHNOLOGY

       Clientele acquisition is thrust area for marketing network put in place in the Bank.
        Pay Roll Savings Bank accounts with attractive features are offered for this purpose.
        Similarly, campaigns are held for acquisition of new customers under Current,
        Savings and Retail Term Deposits. Bank has added more than 3.30 lakhs new
        customers during the financial year taking the overall clientele base to over 63 lakhs.
       The Bank has introduced various innovative techno savvy products/services and
        revised various existing schemes during the year to suit the convenience of the
        customers by focusing on the ever-increasing customer needs.
       New Products/Services introduced and existing schemes revised during the year
        include:
        Corp Pragathi Savings Bank a/c: No Frills Savings Bank account aimed at the
          low income segment to achieve the Financial Inclusion goal of the Central
          Government.
        Acquiring of MasterCard: The Bank has tied up with MasterCard International
          wherein MasterCard Debit / Credit card holders can access their accounts through
          our ATMs.


ATMs:
With the accelerated thrust for ATM network, in tune with the changes and customer
preferences, the Bank has operationalised and networked 100 additional ATMs during the
year 2005-06 taking the total number of ATMs to 901 across the country.
Automated Teller Machines
The Bank has operationalised and networked 75 additional ATMs, taking the total number of
ATMs to 1032, across the country. Firewall has been installed at the Bank’s FTS Centre,
Bangalore. The Bank’s Switch has been upgraded to Triple DES. Direct Tax payment
through ATMs successfully tested, pending for launching. Real Time VISA Money transfer –
instantaneous credit to the customer, is in the pipeline for implementation. Varied by Visa
(VbV) – with a view to ensure better security for card not present transactions for e-
commerce transactions will be made live shortly.




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Bio-Metric ATMs
The Bank has installed 7 Bio-metric ATMs to cater to the requirements of rural clientele on
pilot basis. After seeing the performance of these ATMs, the Bank proposed to examine the
feasibility of expanding the network of such ATMs at other Rural/Semi Urban areas so as to
facilitate the rural populace to have access to products and services that are on par with the
metro locations.
Social Concern
      As in the previous years, during 2005-06 too the Bank took several steps to fulfill its
       social commitment. The Bank donated Rs.1.00 crore to the Maharashtra Chief
       Minister’s Relief Fund (Natural Calamities) to provide relief to the people affected by
       the flood in Mumbai during August, 2005. An amount of Rs.100 lakhs was donated to
       the Karnataka Chief Minister’s Drought and Natural Calamities Relief Fund for relief
       and rehabilitation of the victims of the flood in Karnataka. Further, an amount of
       Rs.100 lakhs was donated to Indraprastha Cancer Society and Research Centre, New
       Delhi towards spreading awareness amongst the people about the fatal ailment.
      As a centenary celebration project the Bank dedicated a modern library and
       numismatic museum to the citizens of Mangalore at a cost of Rs.2.31 crore.
      The Bank also set up libraries in 25 villages in the states of Karnataka, Tamilnadu and
       Andhra Pradesh, where Banking services are offered only by our Bank.
      Apart from the above, the Bank also actively associated itself with various societal
       concerns in accordance with its donation policy.


Corporation Bank Self-Employment Training Institute
[COBSETI]




The Corporation Bank Self-Employment Training Institute [COBSETI] established on
22.03.1996 is a training institute sponsored by the Bank. The institute takes care of the


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vocational training needs of Chikmagalur and Kodagu districts wherein the Bank has Lead
Bank responsibility. During the training period, boarding and lodging is provided free to the
candidates. As at March 2008, the Institute imparted training to 5651 candidates, out of
which 3354 persons have taken up self-employment ventures. The Institute is making all out
efforts to motivate the trained persons in establishing self-employment ventures by co-
coordinating with development departments in providing necessary linkages. During the year,
the institute moved into its own building with all the basic amenities for the trainees.
Including the grant of Rs 20.00 Lakhs received from the Government of Karnataka, the bank
has incurred an expenditure of about Rs.77.44 Lakhs in the construction of a new building
and in providing the required infrastructure and Computers to the Institute.

PERFORMANCE OF SUBSIDIARIES AND OTHER UNITS SPONSORED BY THE
BANK
Corp Bank Homes Ltd
Corp Bank Homes Limited, the wholly owned housing finance subsidiary of the Bank, has
earned an operating profit (Profit before Tax) of Rs.1.09 crore for the year 2005 – 2008 as
against Rs.5.96 crore for the previous year. As against the cumulative provisioning of Rs.4.45
crore during 2004-2005, at the end of the current year, the
Provisioning has doubled to Rs.8.90 crore. The Net Profit after Tax for the year ended March
31, 2008 was Rs.1.29 crore as against Rs.4.97 crore for the previous year. The Loan
disbursement by the Company aggregated to Rs.17.83 crore during the year and the
outstanding advances stood at Rs.270.83 crore as at March 31, 2008. The net worth of the
Company increased to Rs.33.19 crore as against Rs.31.90 crore in the previous year.


MERGER OF CORP BANK HOMES LIMITED
The Board of Directors of the Bank has taken a decision to merge its subsidiary, Corp Bank
Homes Limited, with the Bank, after meeting statutory and all other requirements. The
merger petition has already been filed with the Honorable High Court of Karnataka at
Bangalore.




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CORP BANK SECURITIES LIMITED
The wholly owned subsidiary of the Bank, Corp Bank Securities Limited, a primary dealer in
Govt. Securities posted loss of Rs 1.96 crore, during the fiscal, as against Rs. 68.68 Crore
during the previous year as a result of continued rise in bond yields, tightness in liquidity and
increased demand for credit in preference to debt instruments. The 10 year yield, which was
6.69% as at the end of March 05 rose to 7.52% as at the end of current fiscal. As Primary
Dealer, the Company had to take involuntary position in each primary market auction and to
provide room for fresh securities, by paring the portfolio even in under favorable market
conditions. The loss is brought down from Rs. 68.68 Crore to Rs. 1.96 Crore. The outright
and repo turnover for 2005-06 was Rs 54,478 crore. Consequent to the operating loss, the Net
Owned Funds marginally came down from Rs 133.42 crore to Rs 131.49 crore, while the
Capital Adequacy Ratio position was comfortable at 553%, on account of lower risk
weighted assets held as against the Net Owned Funds as on 31.3.2008.
Corp Bank Securities Limited The wholly owned subsidiary of the Bank, Corp Bank
Securities Limited, (CBSL) earned total income of Rs.8.64 crore during 2008-09, posted
Profit before tax of Rs.8.29 crore and Profit after tax of Rs.6.67 crore. During the .scald, the
company paid an interim dividend of Rs.5 crore and also bought back 25% its Equity Share
of Rs.25 crore face value at a consideration of Rs.35.63 crore i.e. at a premium of Rs.10.63
crore. The Paid-up Share Capital, post buy back and as on 31.3.09 was Rs.75 crore and
consequently the Net Owned Funds came down to Rs.107.83 crore as against Rs.142.85 crore
as the end of previous year. The Company, apart from its existing business of distribution of
Mutual Fund products, started dealing in Certificate of Deposits, Dated Govt. Securities and
Treasury Bills and earned net business income of Rs.0.97 crore for the year. Besides, the
Company could earn interest & dividend income of Rs.5.90 crore on its investment of surplus
funds. The Company would continue to pursue various other business activities in the .scald
2009-10 after securing approvals from its Board and other regulatory authorities.
Chikmagalur-Kodagu Grameena Bank [CHIKO Bank] the Chikmagalur-Kodagu Grameena
Bank [CHIKO Bank], sponsored by the Bank has a network of 52 branches, of which
5 branches were opened during the year. Deposits of CHIKO Bank stood at Rs.246.47 crore
and advances at Rs.172.90 crore [gross] as on 31.03.2009. CHIKOBank recorded a net profit
of Rs.4.02 crore [before taxation] and Rs.2.52 crore [after taxation] for the year ended
31.03.2009.



 BABASAB PATIL                                                                             13
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CORPORATE GOVERNANCE IN CORPORATION BANK
Corporation Bank has been practicing the principles of good corporate governance
consistently over the years. Corporate Governance at Corp Bank is evolved not only by
ensuring compliance with regulatory requirements but also by being responsive to customer
needs. The Bank strives for excellence with the objectives of enhancing satisfaction both to
its customers and shareholders.

COMPLETES A 100YRS OF BANKING
Corporation Bank has completed 100 years of existence on 12 March 2008. The Centenary
celebrations were launched by Shri V. Leeladhar, Deputy Governor, Reserve Bank of India
with the Bank's Foundation Day lecture on 12 March 2005. As a part of the Bank's centenary
celebrations, a number of programmes and projects were planned and executed. As a first
step, the Bank has launched the Corp Kissan Card - debit card tied up with VISA
international,, to enable the farmers make timely purchases for agricultural operations. at
Yeshwantpur-Malur in Kolar District on 13 March 2005. A modern public library was
dedicated to the citizens of Mangalore in DK District, the birth place of the Bank by Shri P.
Chidambaram, Union Finance Minister on 2 March 2008. The library building also houses a
Numismatic Museum and a multi purpose hall for intellectual activities. The Bank has also
set up libraries in 25 villages and given away scholarship to 100 meritorious students of such
villages for the pursuit of their higher education. Such libraries will be set up in 75 more
villages in a phased manner.


RATINGS

CRISIL has re-affirmed the following programmes of Corporation Bank:

      Rs.2 billion Bond issue AAA.
      Certificate of Deposits Programme P1+.
      Fixed Deposit Programme FAAA.




 BABASAB PATIL                                                                          14
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AWARDS WON

      National Award for Assistance to Exporters from the President of India (1976-77)
      Gem & Jewellery Export Promotion Council Award successively for 5 years from
       1981 to 1985
      Shiromani Award 1992 for Banking from Union Minister for Commerce
      Best Bank Award for Excellence in Banking Technology from Institute for
       Development and Research in Banking Technology (IDRBT), Hyderabad (2001)
      Best Bank Award for Innovative Usage and Application on INFINET (Indian
       Financial Network) from Institute for Development and Research in Banking
       Technology (IDRBT), Hyderabad (2002)
      Best Bank Award for Delivery Channels from Institute for Development and
       Research in Banking Technology (IDRBT), Hyderabad (2003)
      Runner-up Awards in the “Best Online and Multi-channel Banking Team” and
       “Outstanding achiever of the year-corporate” categories in recognition of outstanding
       achievement in Banking Technology for 2004, instituted under the aegis of Indian
       Banks Association and Trade Fairs & Conferences International.




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MAJOR RECOGNITIONS

      One of the Best 200 companies world over outside the US having a turnover under a
       billion US$ - Forbes Global, Hong Kong, issue dated 27 October 2003
      India’s Best Public Sector Bank - Business Today - KPMG Survey dated 7 December,
       2003
      India’s Strongest and Asia’s Second Strongest - The Asian Banker, Singapore dated
       15 December 2003
      India’s Best Public Sector Bank - Outlook Money , 15 March 2004
      One among the Best 200/100 companies in Asia/Pacific and Europe having turnover
       under a billion US $ - Forbes Global, Hong Kong dated 1 November 2004
      One among India’s Best Public Sector Banks - Business Today, 26 February 2008




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                               ORGANIZATION CHART

                Organization Structure of corporation Bank at RNR BRANCH

                                      Branch
                                      Manager




                                      Officer



                                      Spl Asst




   Clerk                Clerk                   Clerk Cash      Clerk Cash
Cash Receipts        Cash Payment                Clearing          Term
                                                                 Deposits




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                                BOARD OF DIRECTORS




                              CHAIRMAN & MANAGING
                                   DIRECTOR



                               EXECUTIVE DIRECTOR




                       GENERAL MANAGERS PORTFOLIOS

   1. Management Committee
   2. Audit Committee
   3. Departmental Promotion Committee
   4. Investor Grievance Committee
   6. Risk Management Committee
   7. Committee to monitor large value frauds
   8. Share Transfer Committee
   9. Customer Service committee
   10. Remuneration committee



                            GM Offices/Regional Offices - 18



                                      Branches - 8100




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The Board of Directors
The Board is constituted in accordance with the Banking Companies (Acquisition and
Transfer of Undertakings Act 1980 and Nationalized Banks Scheme 1980 and is
represented by persons with diversified professional experience. The Directors bring in wide
range of expertise and experience to the Board, facilitating proficient and unbiased direction
and control to the Bank.
                      The Board has constituted various committees as under, which provide
specific and focused governance in the important functional areas and control affairs of the
Bank.




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Management Committee:

The Management Committee is constituted as per the provisions of Nationalized Banks

(Management and Miscellaneous provisions) Scheme 1980 and consists of 6 Directors.



Audit Committee:

The formation and functioning of Audit Committee is governed by the directions of RBI. The

Audit Committee provides direction as also oversees the operation of the total audit functions

in the Bank and follow up the statutory/external audit of the Bank and inspection of RBI.



Departmental Promotion Committee:

The Committee assesses the disciplinary cases and promotions to top executive cadre in the

Bank.



Investor Grievance Committee:

The Committee looks into the redressal of investor grievances.

Information Technology Committee:

In the changing environment, to suit the growing needs of customers, the Bank has been

taking various initiatives. To guide the bank for accelerated implementation of these projects

and also to explore the possibility of providing innovative technology based products, this

Committee has been constituted.



Risk Management Committee:

The Committee was formed to guide the bank in respect of integrated risk management.




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Integrated Risk Management System

Risk Management is an integral part of a Bank’s organizational structure and business

strategy. Identification, measurement, monitoring and controlling the risk enables the

Bank to minimize losses and maximize profits. The major types of risk faced by the Bank are

Credit Risk, Market Risk and Operational Risk.

Risk Management Committee of Executives and Risk Management Committee of the Board

are looking after the implementation of integrated risk management systems in the Bank.

Bank has well laid down risk management policies for management of credit risk, market risk

and operational risk. In the area of credit risk, the Bank had in the year 2006 upgraded the

rating models applicable for borrowers under commercial loan segment. The rating models

are working on web based enterprise wide solution called Risk Assessment Model (RAM).

The software, apart from rating the borrowers helps in preparation of appraisal notes. This

software will enable the Bank to build database for moving over to IRB approach of Basel –

II. The software also has a module called Capital Assessment Model (CAM), which is used to

compute capital for credit risk under Standardized Approach of Basel-II as prescribed by

RBI. Bank has complied with the timeframe prescribed by RBI for computation of capital as

per Basel II norms, i.e. 31.03.2009.

For management of operational risk, Bank has introduced the system of incident reporting,

which helps in identifying operational risks. Corrective steps are taken for mitigating these

risks and for upgrading the control mechanism. Under Risk Based Supervision, Risk Profile

Templates covering business risks and two control risks are prepared on quarterly basis and

submitted to Reserve Bank of India.




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Committee to monitor large value frauds:

With a view to provide focused attention on monitoring frauds of Rs.1 Crore and above, this

Committee has been formed.

Share Transfer Committee:

In order to meet the request of the shareholders such as transfer, re materialization and

duplicate shares, the Committee was constituted.

Customer Service Committee:

With a view to safeguard the individual customer’s right and to deliver better customer

service, the Committee was constituted.

Remuneration committee:

The Remuneration committee was constituted to evaluate the performance for arriving at the

eligible incentive amount under performance linked incentives to the whole time directors

(viz.CMD and ED).




 BABASAB PATIL                                                                              25
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                           WHAT IS CORE BANKING?




  Core Banking is normally defined as the business conducted by a banking institution

     with its retail and small business customers. Many banks treat the retail customers as

     their core banking customers, and have a separate line of business to manage small

     businesses. Larger businesses are managed via the Corporate Banking division of the

     institution. Core banking basically is depositing and lending of money.

  Normal core banking functions will include deposit accounts, loans, mortgages and

     payments. Banks make these services available across multiple channels like ATMs,

     Internet banking, and branches. Core Banking Solutions is new jargon frequently used

     in banking circles of India. The advancement in technology especially internet and

     information technology has lead to new way of doing business in banking.




 BABASAB PATIL                                                                       26
To Determine the Effectiveness of Core Banking On Cash Flow

  The technologies have cut down time, working simultaneously on different issues and

     increased efficiency. The platform where communication technology and information

     technology are merged to suit core needs of banking is known as Core Banking

     Solutions. Here computer software is developed to perform core operations of banking

     like recording of transactions, passbook maintenance, and interest calculations on loans

     and deposits, customer records, balance of payments and withdrawal are done. This

     software is installed at different branches of bank and then interconnected by means of

     communication lines like telephones, satellite, internet etc. It allows the user

     (customers) to operate accounts from any branch if it has installed core banking

     solutions.

  Core banking is a centralized approach to handling of bank data and applications. thus

     the data and application of all the branches reside in one centralized location [in a

     common server] and the branches can access their data through a link provided to the

     centralized server.Besides,branches will also have access to the data of other branches

     and can handle operations across branches.

  In core banking, a centralized server is maintained at a designated place and a

     connectivity network is also established as a backbone. Such centralized data

     maintenance will give strategic advantage to the bank. Customers will be the big

     beneficiaries. At the same time, a centralized data maintenance and MIS will relieve the

     branches and the zonal set ups the burden of information generation and follows up.




 BABASAB PATIL                                                                         27
To Determine the Effectiveness of Core Banking On Cash Flow




 BABASAB PATIL                                                28
To Determine the Effectiveness of Core Banking On Cash Flow

FEATURES
               Although decentralized automation at the micro or the branch level, achieved the

     primary objectives of handling additional volumes, imparting better customer service /

     customer convenience, improving productivity etc. to a great extent, at the macro level,

     there was always a scope for improvement.

               The decentralized environment was handicapped to an extent in imparting the desired

     extent of flexibility to MIS generation, introduction of Customer Relationship Management

     [CRM] functions, Data warehousing and Data mining facilities etc. Further, the

     implementation of innovative delivery channels and techno-savvy products are also

     relatively difficult in decentralized environments.

               A typical Core Banking Solution envisages the branches being linked to a centralized

     location for accessing data. The users will be logging on to the Core Server from remote

     branches and all program executions will take place only at the Core Server. From the view

     point of the institution, the availability of data centrally affords the flexibility of using the

     consolidated pool of information at the disposal which is capable of tremendous processing and

     information generation capabilities.



FACILITIES

     Compared to a decentralized setup, the Core Banking Solution has the following advantages:

             • Centralized database for performing various online banking utilities

             • Facilitates Any Branch Banking

             • Shifting of time consuming activities like End of Day (EOD) processing,

               Interest calculation, interest posting, debiting inward clearing cheques etc., to centralized

               location to enable the field level functionaries to concentrate on customer service and

               marketing activities


 BABASAB PATIL                                                                                        29
To Determine the Effectiveness of Core Banking On Cash Flow

       •       Facilitates centralized auditing of branches

       •       Provides for effective monitoring by the controlling offices

       •       Facilitates ease of maintenance of the package

       •       Enables simultaneous launching of new products across all branches connected

               To the CBS

       •       Paves the way for setting up a Data Warehouse

       •       Facilitates better MIS as a decision support tool.

       The Core Banking environment offers a totally different perspective from the business

     angle when compared to a decentralized environment. With the Core Banking in place, the

     focus of erstwhile "Branch Banking" will shift to "Bank Banking". Further, the banking

     operations assume "Round the clock" capability which is not limited by closure of the

     branches, holidays etc.



DEPENDENCIES
               As in the case of any technology based service, there are some dependencies for

                  the Core Banking applications also. Some of the critical dependencies are on the

                  Network, Competent Manpower and the Pre-Core Activities to be completed at

                  the branches.

               The Bank has all its branches automated using the TBA package. In a typical

                  scenario, the branches start afresh on Core Banking package. This requires the

                  details of all the existing accounts, masters etc. to be created afresh. The Bank has

                  gone in for a Core Banking solution which offers the flexibility of migrating from

                  the existing TBA by converting all the relevant data to the Core.




 BABASAB PATIL                                                                                  30
To Determine the Effectiveness of Core Banking On Cash Flow

                  This entails that a lot of pre-core activities have to be accorded due importance as

                     the success of the CORE Banking setup [CBS] hinges on these activities to a great

                     extent.



PRE-CORE ACTIVITIES AT BRANCHES

    Whilst on this it may be relevant to note that there are certain activities, which need to be

       done by the branch officials in co-ordination with the officials of the Zonal Computer Centers so

       as to be in all readiness for the transition from an automated branch to a core banking

       branch.



    With a view to helping the branch officials for smooth transition from TBA to Core Banking,

       the following step by step activities are listed. Needless to mention, these activities have to

       be completed at least 15 days prior to migration to the Core Banking solution.


HOUSE-KEEPING

             Balancing and tallying of accounts is one of the important pre-requisites for

                 migration to Core Banking. It shall be ensured that the balances of the following

                 heads of accounts are tallied with the General Ledger:

        •    Running accounts like SB, CA, OD, CC etc.

        •    Loan accounts like HPL, DLS, HL etc.,

        •    Deposit accounts like FD, KCC, RD, JD etc.,

        •    Interest Payable Account

        •    Pay Orders Account

       •     Bills like DBC, BDD, OBCC, OBCO, IBC, BE, BELC, LRDS etc.

        •    Sundry Assets and Suspense Accounts


 BABASAB PATIL                                                                                    31
To Determine the Effectiveness of Core Banking On Cash Flow

            The branches shall submit a confirmation to this effect by furnishing the details sought

               in the Format prescribed for the purpose for recording the balancing figures, GL

               figures, No. of accounts etc. in Annexure-1, Annexure-2, & Annexure-3. These

               formats shall be duly authenticated by the officials of the branch on recording the

               relevant details.

            Further, the branches shall ensure that:

       • All balances of breakup GLs under a Sub GL are tallied with respective Sub-GL balance

       • All the SUB-GLs under a GL are tallied with respective Main GL balance.

            The scanning and tagging of signatures are activities which are pre-requisites for

               effective CBS and for implementation of Any Branch Banking [ABB]. If the signatures

               are not scanned and tagged, the branches would find it difficult to honor the

               cheques of a customer of another branch under ABB. The branches therefore need to

               accord top priority to this activity and are advised to scan and tag the signatures on a day

               to day basis and to keep them updated.

REPORT GENERATION IN IBAS6


            In order to check the accuracy and integrity of data on migration to CBS, the branch

               shall generate the various reports mentioned below in the TEA environment before

               migration. As it is also planned to preserve the generated report files, the following

               steps shall be followed:

       Create a separate directory CORE in J:\REPORTS

       •     Map J: =VOLl:\REPORTS\CORE so that all the reports will be generated in

J:\REPORTS\CORE..The branches shall take 2 sets of these reports and these printed reports are

to be verified for accuracy and authenticated by the branch personnel. One copy of the report shall

be preserved by the branch permanently for future reference and auditing purposes and the other copy


 BABASAB PATIL                                                                                      32
To Determine the Effectiveness of Core Banking On Cash Flow

shall be forwarded to the Core Centre, Bangalore for verification of these reports with the reports

generated in the Core Server after migrating the branch data.

The following reports shall be generated for the dates mentioned:

        •        Last day of the previous three quarters

        •        First day of the previous three quarters

            01      R_RDSHT                  RD/TB

            02      R_TRIAL                  Trial Balance
            03      R_CORPBK                 Sub day book
            04      R_GLASON                 GL as on date
            05      R_CSHSCL                 Cash scroll
            06      RJTRFSCR                 Transfer Scroll
            07      R_BPOOST                 PO outstanding list
            08      R_CLGSCR                 Clearing Scroll
            09      P-OCAUTH                 Clearing register
            10      R_OCLED                  Clearing ledger
            11      R_PAC                    For a few selective parties
            12      R_OUTGS                  Outstanding BGs
            13      R_SUMBAL                 Balancing of all GLs for above dates
            14      R_ACBAL                  Balancing name wise (for a few heads)
            15      R_MSM01                  MSM for a date
            16      R_BOOK81                 Originating Entries
            17      R_BOOK82                 Responding Entries
            18      P_B81DF                  IBR Data file generation
            19      R_EXLST                  Exception Transaction List
            20      R-TCHK                   Transaction Check list
            21      R_CCLST                  Master data printing




 BABASAB PATIL                                                                               33
To Determine the Effectiveness of Core Banking On Cash Flow

STANDARDIZATION OF GL/SUB-GL/BREAKUP-GL

             As the entire database of the Bank in the CBS will be available in a single place, to
               maintain uniformity and ensure compatibility, there is a need for standardizing most of
               the Master Records to be used by the branches like :


       •    Prefix master
        •   Mode of Operation
        •   Place Master
       •    Country Master
       •    State Code Master
       •    Branch master of the Bank
       •    General Ledger, Sub-GLs and Breakup GLs


             The standardization of Masters is also very critical to generate meaningful MIS
               from the Core Centre. A list of standardized GL/SUB-GL/BREAKUP-GL is
               enclosed in Annexure-4 for your information.


             Instances have been observed wherein branches have posted some transactions
               for a given GL/Sub-GL/Breakup-GL in one accounting year (For e.g.:
               Transaction posted in the year 2002-2003 for 821/52/71 - Sundry Assets -
               Sundry Debtors - Advances drawn by XYZ) and have deleted such Sub-GLs or
               Breakup GLs in the subsequent year (For e.g.: the branch has deleted the Breakup-
               GL 71 of 821/52 in the year 2003-2004).


             In all such instances the transactions posted for the deleted Sub-GLs / Breakup
               GLs will be displayed when the program Q_TR or Q_TRAN is invoked, as
               these transactions are not deleted. But they may not get displayed when
               Q_GLASON is invoked as the Sub-GL/ Breakup-GLs are deleted. This will
               result in anomaly m the R_GLASON report generated by the branch for dates of
               the earlier year.




 BABASAB PATIL                                                                                  34
To Determine the Effectiveness of Core Banking On Cash Flow

            In order to ascertain whether such mistakes have taken place in the branch, the
              program R_GLSCAN shall be run which will read the transaction files and
              generate a report of such of those transactions for which master details of GL/ Sub-
              GL / Breakup-GLs are not available.


            If any Sub GL / Breakup-GLs are missing, the same should be created using
              M_GLSH and M_GLGB (option 17 and 18 of Main Menu).


            The program R_MISSSG shall give a report on missing Sub-GL for Breakup-GLs.
              The missing Sub-GLs can be created using M_GLSH.


            Wherever unwanted break-up GLs exist and if there is no balance or no
              transactions during the last 2 years, the same may be deleted.


            The existing GL/SUB-GL at the branch has to be mapped to the standardized GL
              supplied by the Core. If the branch finds any Breakup-GL which has been now
              brought to the level of GL/ SUB-GL in the standard supplied by the CORE, they are
              to be mapped accordingly. Branches have to write the mappings in the
              R_GLASON report taken at the branch.


STANDARDIZATION OF MASTERS
    Under the Core Banking environment, standardization of MASTERS has been earned out.

       A List of standardized MASTERS is enclosed (Annexure-5 and Annexure-6).

    Some instances have been observed wherein the branches have deleted some SUB-

      TYPES of some account types after putting through transactions in those accounts and sub

      types for some time. This is similar to deletion of Sub-GL / Breakup GL as explained earlier

      resulting in some anomaly. In order to identify such deletion, the programs R_AMTYPE, and

      R_BLTYPE shall be run which shall give report on missing Parent Master for Account

      type/Sub type, Bill type. These reports shall indicate account type/bill type used and

      subsequent deletion of the account type/bill type master. '***' in the report indicates


 BABASAB PATIL                                                                              35
To Determine the Effectiveness of Core Banking On Cash Flow

      missing Master but used at the account level. The Conversion Team from the Zonal

      Computer Centre shall decide whether such master is to be added or not. If it is to be added,

      as some live accounts could be available, after adding the same such account types/bill

      types are to be mapped to the standard masters supplied to the branch.

    The Conversion Team from the Zonal Computer Centre shall map all the deviations in

          the master with the Standard Master supplied by the Core Centre. The branch shall then

          take the printouts of Masters using print option available in the respective master

          programs. (Refer Annexure 5 & Annexure 6)


BRANCH SPECIFIC PARAMETERS
         As mentioned earlier, standardized parameters shall be created for each of the modules

               Arid these parameters shall be bifurcated as given below:

               (a) Parameters maintained by the Core Centre which is applicable to all branches

               (b) Branch specific parameters,

         For example, parameters like Deposit Interest Rate, TDS Rate, Account Closure, Outward

     Bills Charges, DD/PO accounting parameter etc. are maintained at the Core and the branches will

     not be in a position to modify these parameters whereas parameters like Locker Charges, DD/PO

     charges etc. which are specific to branches are examples of Branch-wise parameters which can be

     changed by the branches. The branch specific parameters shall be kept ready by all branches

     identified for Core Banking for different modules like :

      •        Demand Drafts

      •        Pay Orders,

      •        Telegraphic Transfer/Mai 1 Transfer,

     •         Bills/Cheques for Collection,

     •         Purchase of Bills/cheques,


 BABASAB PATIL                                                                                36
To Determine the Effectiveness of Core Banking On Cash Flow

     •          Outward clearing returns,

     •          Inward clearing returns,

     •          Locker rent,

     •          Folio charges,

     •          Cheque book issue charges,

     •          Charges for duplicate statement of accounts,

     •          Charges for not maintaining minimum balances,

     •          Charges for utilizing cheque leaves,

     •          Other charges for OD/CC accounts while calculating interest etc.

        These branch specific parameters will be updated at the Core Centre, branch-wise as a one

     time measure before the branch goes live under the Core environment. Subsequent changes

     required for these parameters are to be effected by the branches by choosing the appropriate

     options.

        Branch shall also provide the following information in the Annexure-7 format.

     •        Last Inter Branch Transaction Serial Number used (TSL. NO.)

     •        Last used Pay Order Serial Number

     •        Last used Account Serial Numbers under each account types and sub-types.

     •        Last used serial numbers of LC/BG/LOCKER

     •        Last used serial number for Telegraphic Transfer

     •        Last used serial number for Mail Transfer

     •        Last used serial numbers for Inward & Outward Bills/Cheques

     •        Last used serial number for TDS- 16A




 BABASAB PATIL                                                                              37
To Determine the Effectiveness of Core Banking On Cash Flow

STANDARDISATION OF LOGIN-ID/USER-ID


        In the Core Banking environment, the Login-ID for the Core UNIX Server shall be the

     respective Employee numbers (E.g. E02336). Standardization has also been made in

     respect of Login-IDs in the Core UNIX Server and User-IDs in the Application Software.

     Since the operating system used in the Core server being UNIX is case sensitive, the

     users shall take care to remember the upper or lowercase in which the characters are

     entered while keying in the passwords for logging into the Core UNIX Server

        The User-ID in the application software shall always be in upper case as hitherto being used

     in IBAS6, Hence, the alphabet 'E' at the beginning of the employee number of the user-id shall

     be given in upper case only, (E.g. E02336). Please note that the Password is also case

     sensitive. (E.g. the password LASER is different from laser and Laser is different from

     Laser)

        In view of the above changes and to assist the Core Migration Team to create the users of

     each branch, the branches are required to prepare a list mentioning the following details in

     respect of all the employees working presently in the branch :

     •        E. No.

     •        Name

     •        Designation

     •        Signing Power Number (In the case of Special Assistant & Officers)

     •        Date of joining at the Bank and Branch

     •      Details of employees on deputation to the branch need to be mentioned with

            Information about their base branches as per format in Annexure-8




 BABASAB PATIL                                                                                 38
To Determine the Effectiveness of Core Banking On Cash Flow

PHASE-1-HISTORY DATA


              On completion of the aforesaid exercises, the backup of data shall be taken with the

     assistance of the officials of the ZCCs. The officials of the ZCC shall also scan the data of the branch

     for any corruption. Once the scanning process is completed, the data from the date of computerization

     of the branch till the previous quarter shall be backed up in CDs in 3 sets / copies by the officials

     of the ZCC. The CDs containing the files *.7*, *.8*, *.9*, *.0* (except current quarter) shall

     be sent to Core Centre, Bangalore in advance so as to enable the Core Centre to start the

     preparatory work in connection with data migration in advance. The Branch shall also send a letter

     in duplicate enclosing the CDs to the Core Centre, Bangalore as per format in Annexure-10. The

     Core Centre on receipt of the CDs shall return the duplicate copy of the letter to the branch duly

     signed, as a confirmation for having received the CDs. It is essential for the Core Centre to

     receive the data CDs of the branches identified for migration to Core banking at least 15 days

     in advance.

    One copy each of CDs shall be kept in the fireproof cabinet at the branch as well as at the

       Zonal Computer Centre.



PHASE-H-CURRENT QUARTER DATA

      It is ideal to take up the migration process only on weekly holiday / holiday of the branches

     so that the converting team has sufficient time to convert the data. One day prior to the

     planned date of migration (on Friday in most of the cases if Sunday is the weekly holiday)

     the data of the branch shall be scanned by the officials of the ZCC for corruption, if any,

     so that such corrupted data can be recovered and kept ready for being sent to the Core

     centre, the next day. Once the data is ensured free from corruption, the *.BNK and *.0*

     files of current quarter, *.COB, *.SCN, *.EXE, *.BAT, *,MSG & *.COM,


 BABASAB PATIL                                                                                        39
To Determine the Effectiveness of Core Banking On Cash Flow

     *.DLL etc. available in the LIVE AREA i.e. L:\1BAS6 and also the reports generated in

     J:\REPORTS\CORE shall be copied in CDs by the officials of the ZCC. The CDs shall

     be cut into 3 copies / sets. The Branch shall send a letter in duplicate enclosing the CDs to

     the Core Centre, Bangalore as per format in Annexure-10. The Core Centre on receipt of

     the CDs shall return the duplicate copy of the letter to the branch duly signed, as a

     confirmation for having received the CDs. It shall be ensured that the copying of data from

     the live area to CDs as mentioned above shall be undertaken only after tallying RD/TB and

     completing the EOD process for that day i.e. on the eve of migrating to Core Banking. It

     shall also be ensured that if any Outward Clearing Returns have been marked, the same has

     been debited to the respective accounts / heads by executing 'Clearing the Unclear option'.

     This is required since in the new software, procedure for marking the returns has been

     changed to accept the Clearing date & Serial number under which the instruments have been

     returned.

      One copy of the CDs containing the data of the current quarter shall also be sent to the

     Zonal Computer Centre and another copy shall be kept in the fireproof cabinet at the

     branch.



NEW MENU (FOR INFORMATION)

    Under the Core Banking software, flexibility is available to define the MENU to be shown

       To different levels of users such as:

       •         Manager & Officer

       •         Operator

    A copy of the new menu list is provided to the branch so as to enable the staff members

       to become familiar. The details of the different levels of the menus are displayed in

       Annexure-9

 BABASAB PATIL                                                                              40
To Determine the Effectiveness of Core Banking On Cash Flow


STATUS OF MODULES IMPLEMENTED


    In order to ascertain whether all the modules have been ported and also for the purpose

       of migrating al the implemented modules, the branches shall provide the details in the

       format as per Annexure-12.



MANAGEMENT OF HISTORY DATA IN THE NOVELL SERVER

    The branch servers used until the date of migration will be available in the branches only for

       verification of entries made, printing of old entries in Pass Book, attending to the queries of

       Customers, Government Agencies etc.

    The data from the beginning of the previous financial year onwards, till the current date of

       migration will only be migrated to Core immediately.[ i.e. a branch getting migrated to Core

       Banking in the financial year 2003-04 from TEA shall have only data from 01-04-2002 in the

       Core Banking setup]. The migration of data from the date of computerization of the branch till

       the year end up to which the data has been migrated to Core Banking [i.e. 31-03-2002 in the

       above case] will be taken up at a later date.

    Therefore, till such time the entire history data is migrated to Core Banking, the branch shall

       use the Novell Server for all the queries, pass book printing, statement of accounts, report

       generation etc.

    As a security measure, all the entry programs in the Novell Server shall be deleted by the

       officials of the ZCC permanently so that it is not possible to put through any entries / transactions in

       the Novell Server.

    Further, the officials of the branch shall once login to the Novell Server using Admin-ID and

       password to ascertain whether the password is accepted / correct. Once successfully logged

       into the Novell Server using ADMIN ID and password, the Admin password shall be kept in a

 BABASAB PATIL                                                                                          41
To Determine the Effectiveness of Core Banking On Cash Flow

       sealed cover and preserved in the Double Lock of the branch. A copy of the Admin password

       shall be also kept in a sealed cover and handed over to the ZCC official who visits the branch for

       Migration activity for preservation at ZCC under double lock.



POST-CORE ACTIVITIES

    User ID of Branch Officials

       Once the data migration is completed, the USER-IDs of the branch officials will be created at the

       Core Centre. The default password will also be given at the Core Centre. These User-IDs

       and the default passwords will be communicated to the respective branches.

    User ID of the Branch Staff

       As soon as the officials of the branch using the User-IDs, log in to the Core UNIX Server,

       There will be a prompt to change the password. The Branch Officials shall change the password

       immediately. The USER-IDs for all the staff members working at the branch shall be created.

       The same need to be authenticated by two officials other than the official who has created

       the USER IDs.

    Generation of reports in Core Unix Server

            Based on the information provided on Mapping of Account Types, GLs, Sub-

               GLS, Breakup GLs, Masters etc., the Core Team shall execute a set of programs

               for mapping the branch data to the core data and perform a process by which the

               Master and Transaction data of the branch will be migrated to a format as required

               by the Core Banking Software. As the migration process has also ensured

               standardized masters, GL, SubGL, Breakup GLs, Account Types etc., it is

               necessary to check the integrity of the converted data.

            A report will be generated at the Core Centre showing the details of the mappings

               carried out. This report will be sent to the Branch and the Officials at the branch /

 BABASAB PATIL                                                                                    42
To Determine the Effectiveness of Core Banking On Cash Flow

              Branch Manager shall verify the report and certify the accuracy on the same day.

              Specimen of the Certificate is attached as Annexure-11.

            To perform such an integrity check, the branch shall generate various reports

              mentioned above from the migrated data from Core Unix Server and verify with the

              reports generated earlier in TEA [IBAS6] of Novell Server. The figures in both

              the reports should tally. The Branch shall report the inconsistencies if any, to

              the Core Conversion team immediately.

            If the Branch is satisfied about integrity of the data based on the various reports

              generated from the Core UNIX Server, they should give a certificate to the

              effect that the Branch has successfully converted, on the migration day itself.

              Specimen of the format of the Certificate is attached as Annexure-11. The Certificate

              along with the reports generated both in NOVELL SERVER and CORE UNIX

              SERVER should be authenticated by the branch officials/Branch Manager. The same

              should be filed and kept in double lock for future verification and auditing.




 BABASAB PATIL                                                                                43
To Determine the Effectiveness of Core Banking On Cash Flow

CASH FLOW STATEMENT OF CORPORATION BANK

The cash flow statement is distinct from the income statement and balance sheet because it

does not include the amount of future incoming and outgoing cash that has been recorded on

credit. Therefore, cash is not the same as net income, which, on the income statement and

balance sheet, includes cash sales and sales made on credit.


Cash flow is determined by looking at three components by which cash enters and leaves a

company: core operations, investing and financing,


OPERATIONS

Measuring the cash inflows and outflows caused by core business operations, the operations

component of cash flow reflects how much cash is generated from a company's products or

services. Generally, changes made in cash, accounts receivable, depreciation, inventory and

accounts payable are reflected in cash from operations.

               Cash flow is calculated by making certain adjustments to net income by

adding or subtracting differences in revenue, expenses and credit transactions (appearing on

the balance sheet and income statement) resulting from transactions that occur from one

period to the next. These adjustments are made because non-cash items are calculated into net

income (income statement) and total assets and liabilities (balance sheet). So, because not all

transactions involve actual cash items, many items have to be re-evaluated when calculating

cash flow from operations.




 BABASAB PATIL                                                                           44
To Determine the Effectiveness of Core Banking On Cash Flow

INVESTING

Changes in equipment, assets or investments relate to cash from investing. Usually cash

changes from investing are a "cash out" item, because cash is used to buy new equipment,

buildings or short-term assets such as marketable securities. However, when a company

divests of an asset, the transaction is considered "cash in" for calculating cash

From investing.



FINANCING

Changes in debt, loans or dividends are accounted for in cash from financing. Changes in

cash from financing are "cash in" when capital is raised, and they're "cash out" when

dividends are paid. Thus, if a company issues a bond to the public, the company receives cash

financing; however, when interest is paid to bondholders, the company is reducing its cash.


BENEFITS FROM USING CASH FLOW

The cash flow statement is one of the four main financial statements of a company. The cash

flow statement can be examined to determine the short-term sustainability of a company. If

cash is increasing (and operational cash flow is positive), then a company will often be

deemed to be healthy in the short-term. Increasing or stable cash balances suggest that a

company is able to meet its cash needs, and remain solvent. This information cannot always

be seen in the income statement or the balance sheet of a company.



                                LITERATURE SURVEY

 The title of the project report is “To Determine the Effectiveness of Core Banking On

Cash Flow” of corporation bank at RNR BRANCH.




 BABASAB PATIL                                                                          45
To Determine the Effectiveness of Core Banking On Cash Flow

BODY OF THE REPORT:

    The research is under taken to determine the effectiveness of core banking on cash

       flow introduced by corporation bank.

    Primary data was collected by administration questionnaire of 100 customers & 10

       employees (All) of corporation bank at RNR BRANCH.

    The questionnaire was specially framed to meet the requirement of the survey.

    Direct contact was made with the respondents through random sample to collect the

       needful information with reference to our objective as for to meet the survey

       requirements.

STATEMENT OF PROBLEM:

    “ To Determine the Effectiveness of Core Banking On Cash Flow” of

       Corporation bank at RNR BRANCH.

MANAGEMENT PROBLEM:

    Today every bank is offering the services which can simplify the banking system.

   Corporation Bank is serving the customer community since past 101 years & has now

   introduced a unique concept of banking that is core banking at RNR BRANCH. The

   Management now wants to know the effectiveness of core banking on cash flow.




 BABASAB PATIL                                                                       46
To Determine the Effectiveness of Core Banking On Cash Flow

PURPOSE OF THE STUDY:

   Since corporation bank at RNR BRANCH has introduced the concept of core banking

   recently. The Management, in this survey wants to find out the growth percentage of cash

   flow by introduction of core banking solutions & also to know the impact of core banking

   on employees & customers of corporation Bank.

OBJECTIVES OF THE STUDY

      The main objective of the study is to determine the effectiveness of core banking on

       cash flow.

      To know the impact of core banking on employees & customers of corporation Bank.

      To analyze the core banking Activities

      To find out the growth percentage of cash flow by introduction of core banking.

      To analyze the difficulties of core banking and suggest suitable remedies.




 BABASAB PATIL                                                                           47
To Determine the Effectiveness of Core Banking On Cash Flow

                                     METHODOLOGY
Sample size:

         A sample of 100 customers & 10 employees of the bank were chosen for the purpose

          of study.

Sampling procedure:            Random Sampling Method.

         From the large number of account holder’s of the bank, 100 customers were selected

          randomly from the bank’s data base & since there are only 10 employees working

          under the concept of core banking all the employees were considered for the study.

Research design

         Since the management problem is already known the research design best suitable for

          this research is Descriptive research design.



Data Collection Method

        To fulfill the objectives of my study, I have taken both into considerations viz primary

& secondary data.

  Primary Data:

        Primary data was collected through making survey, which is systematic collecting of

         information directly from the respondents i.e. through Questionnaires.

  Secondary Data:

        Secondary data was collected through Organizational records.

        The various sources that were used for the collection of secondary data are

         o Internal files & materials

         o Websites – www.corporation.com




 BABASAB PATIL                                                                            48
To Determine the Effectiveness of Core Banking On Cash Flow

Measuring tools

      For this purpose measurement technique used for survey is questionnaire to collect

       information from the respondents. Having collected the information, the information

       was represented by using statistical tools like bar charts and pie charts.

      Second measuring tool is the result of the analysis of cash flow statements.




 BABASAB PATIL                                                                        49
To Determine the Effectiveness of Core Banking On Cash Flow

                                ANALYSIS AND INTERPRETATION

                                          (ONLY FOR EMPLOYEES)
1. EMPLOYEE EXPERIENCE


            PARTICULARS                              FREQUENCY                    PERCENTAGE
           A. SINCE 1 YEAR                               1                            10
          B. SINCE 2-5 YEARS                             2                            20
        C. MORE THAN 5 YEARS                             7                            70
                          TOTAL                               10                              100



                              80
                              70
            PERCENTAGE




                              60
                              50
                              40



                                                                                               70
                              30
                              20
                                                                       20




                              10
                                                10
                                          1




                                                                 2




                                                                                        7



                               0
                                            R                    S                        S
                                          EA                   AR                       AR
                                      Y                      YE                  5Y
                                                                                    E
                                  CE1                    2-5
                              SIN                   CE                      AN
                                                                          TH
                         A.                     SIN                    RE
                                           B.                        MO
                                                            C.
                                                           PARTICULARS




INTERPRETATION:
The objective of the question was to know the employees experience in this bank. This will

reflect the relationship with the bank.10% of the Employees have been working in this bank

since 1 year, 20% of the Employees have been working in this bank since last 2-5 years and

70% of the Employees have been working in this bank more than 5 years.




 BABASAB PATIL                                                                                      50
To Determine the Effectiveness of Core Banking On Cash Flow

2. SATISFACTION LEVEL.


                          PARTICULARS                           FREQUENCY                   PERCENTAGE
                     1. VERY MUCH SATISFIED                         6                           60
                     2. SATISFIED                                   4                           40
                     3. DELIGHTED                                   -                            -
                              TOTAL                                    10                          100



                                      70
                                      60
        PERCENTAGE




                                      50
                                      40
                                                           60


                                      30


                                                                                  40
                                      20
                                      10
                                                     6




                                                                        4




                                                                                                  0
                                                                                                           0
                                          0

                                                     IED                     D                     E   D
                                               ISF                    FI E                      HT
                                            AT                    TI S                      LI G
                                          S                     SA                     DE
                                     CH                    2.
                                   MU                                            3.
                              RY
                           VE
                      1.
                                                                   PARTICULARS




INTERPRETATION:

The Objective of the question is to understand the satisfaction level of the employees. Most

of the employees are satisfied with the concept of core banking. The percentage of the

satisfaction is 60% and 40% respectively. It states that most of the employees are satisfied.

The concept can be more effective if all the employees are fully satisfied with the concept.




 BABASAB PATIL                                                                                                 51
To Determine the Effectiveness of Core Banking On Cash Flow


3. ANALYSIS ON BENEFIT OF CORE BANKING.



                              PARTICULARS       FREQUENCY      PERCENTAGE
                                   1.YES            10             100

                                  2.NO                  -                -
                                TOTAL                  10               100


                        120

                        100
           PERCENTAGE




                        80

                        60
                                                100




                        40

                        20
                                     10




                                                                    0


                                                                              0


                         0

                                           ES                       2.N
                                                                       O
                                    1 .Y

                                                      PARTICULARS




INTERPRETATION:

The Objective of the question is to understand whether the customers of the bank are really

benefited from the concept or not. The percentage of the response is 100%.It states that most

of the employees believe that the concept is really helping the customers of the bank.




 BABASAB PATIL                                                                           52
To Determine the Effectiveness of Core Banking On Cash Flow


4. IMPACT ON CASH FLOW.


                            PARTICULARS       FREQUENCY    PERCENTAGE
                                 1.YES            8             80

                                2.NO                2               20
                              TOTAL                10               100



                       90
                       80
                       70
          PERCENTAGE




                       60
                       50
                                             80




                       40
                       30
                       20                                                 20
                       10
                                  8




                                                                2




                       0

                                        ES                      2.N
                                                                   O
                                 1 .Y

                                                  PARTICULARS




INTERPRETATION:

The Objective of the question was to know the effectiveness of core banking on cash flow.

The percentage of the response is 80% and 20% respectively. It states that majority of the

employees believe that the concept of core banking solutions helps in increasing the cash

flow. The percentage of the response can be increased if the problems are properly diagnosed

which in turn helps in knowing the effectiveness of core banking on cash flow.



 BABASAB PATIL                                                                        53
To Determine the Effectiveness of Core Banking On Cash Flow


5. ANALYSIS OF TIME & MONEY.


                           PARTICULARS        FREQUENCY      PERCENTAGE
                                1.YES             9               90

                                2.NO                 1               10
                               TOTAL                10               100



                         100
                         90
                         80
                         70
            PERCENTAGE




                         60
                         50
                                              90




                         40
                         30
                         20
                         10
                                                                           10
                                   9




                                                                 1




                          0

                                         ES                      2.N
                                                                    O
                                  1 .Y

                                                   PARTICULARS




INTERPRETATION:

The Objective of the question was to know whether the concept of core banking saves time &

money of the employees & customer of the bank. The percentage of the response is 90% and

10% respectively. It states that majority of the employees believe that the concept of core

banking solutions saves time & money of the employees & customer of the bank .Hence it is

effective as far as time & money is concerned.




 BABASAB PATIL                                                                       54
To Determine the Effectiveness of Core Banking On Cash Flow




6. COMPARISION WITH PREVIOUS CONCEPT.


                PARTICULARS                       FREQUENCY               PERCENTAGE
                    1.IBAS                            -                        -

              2.CORE BANKING                              10                  100

                    TOTAL                                 10                 100



                                      20




                                                                     20
                                      18
                                      16
                                      14
                                GE




                                      12
                                TA
                              EN




                                                                10

                                      10
                            RC




                                       8
                          PE




                                       6
                                       4
                                       2
                                                  0
                                                      0




                                       0
                                                  S
                                                BA             NG
                                            1.I              KI
                                                           AN
                                                         EB
                                                    OR
                                                 2.C
                                        S
                                     LAR
                            TICU
                         PAR


INTERPRETATION:

The Objective of the question was to know which of the concept is more easier and advantage

one is the core banking concept and another is IBAS (which was used before core banking)

.The percentage of the response is 100% respectively. It states that majority of the employees

believe that the concept of core banking solutions is easier and advantage as compared to

IBAS.



 BABASAB PATIL                                                                          55
To Determine the Effectiveness of Core Banking On Cash Flow



7. ANALYSIS OF TRAINING.


                    PARTICULARS             FREQUENCY       PERCENTAGE
                         1.YES                  10              100

                           2.NO                 0                      0
                          TOTAL                10                     100


                    120

                    100

                    80
              age
           nt




                    60
           e




                                      100
        rc
      pe




                    40

                    20
                             10




                                                                            0


                     0                                                            0
                                    1.YES                                       2.NO

                                                                 rs
                                                          cula
                                                    parti



INTERPRETATION:

Since the concept of core banking is new to the organization, the Objective of the question

was to know whether bank/management has given any training for the employees for the

smooth operation of the work. The percentage of the response is 100% and 0% respectively.

This clearly shows that bank/management given any training with respect to core banking for

the smooth operation of the work.




 BABASAB PATIL                                                                         56
To Determine the Effectiveness of Core Banking On Cash Flow



8. EFFECTIVENESS OF TRAINING.


                PARTICULARS                    FREQUENCY         PERCENTAGE
        1.VERY MUCH SATISFIED                      3                  30
        2. SATISFIED                               7                  70
        3. NOT AT ALL SATISFIED                    0                   0
                      TOTAL                           10                100



                 80
                 70
                 60

                 50
           age
        nt




                 40
        e




                                                           70
     rc
   pe




                 30

                 20
                                  30




                 10
                                                  7
                           3




                                                                         0


                  0                                                            0
                         1.VERY MUCH            2. SATISFIED          3. NOT AT ALL
                           SATISFIED                                    SATISFIED

                                                        lars
                                                pa rticu



INTERPRETATION:

The Objective of the question was to know the effectiveness of the training program given by

the bank. This will help in analyzing the problem with the concept of core banking. The

percentage of the response is 30% and 70% respectively.




 BABASAB PATIL                                                                        57
To Determine the Effectiveness of Core Banking On Cash Flow




9. ANALYSIS OF DRAWBACK.


                       PARTICULARS             FREQUENCY      PERCENTAGE
                            1.YES                  6               60

                                   2.NO             4                  40
                            TOTAL                   10                 100



                                               60
                                     60


                                     50


                                     40


                                                                  40
                               ge
                               a
                            nt




                                     30
                           e
                        rc
                       pe




                                     20


                                     10
                                           6




                                                              4




                                      0
                                      rs   1.YES
                               cula                           2.NO
                         parti




INTERPRETATION:

The Objective of the question was to know the drawback of the concept if there are any. This

will help in analyzing the problem with the concept of core banking and coming out with a

problem solution. The percentage of the response is 60% and 40% respectively. This clearly

shows that some employees of the bank are not completely satisfied with the concept since

they believe there are some drawbacks. Once the drawbacks are analyzed the concept can be

called as effective.

 BABASAB PATIL                                                                        58
To Determine the Effectiveness of Core Banking On Cash Flow


  10. ANALYSIS OF PROBLEM.


               PARTICULARS                             FREQUENCY          PERCENTAGE
        1. LACK OF TRAINING                                2                   20
        2. AWARENESS                                       8                   80
        3. TIME CONSUMING                                  0                    0
                        TOTAL                                10                     100




                                                      80
                                 80
                                 70
                                 60
                                 50
                       age
                    nt




                                 40
                    e
                 rc




                                 30
               pe




                                           20




                                 20
                                 10
                                                  8
                                       2




                                  0
                                                           0
                                                           0




                          c   ul ars   1.
                                          LA       2.        3.
                  parti                      CK       AW
                                                         AR
                                                                 TIM
                                                  OF        EN       EC
                                                     TR         ES     ON
                                                       AI          S      SU
                                                         NI                  MI
                                                           NG                  NG




INTERPRETATION:

The Objective of the question was to know the problem that the employees of the bank are

facing with respect to core banking. This will help in analyzing the problem with the concept

of core banking and coming out with a problem solution. The percentage of the response is

20% and 80% respectively. This clearly shows that some employees of the bank are facing

problem with lack of training and awareness of the concept. If this problem is over come then

the concept can be called effective.


 BABASAB PATIL                                                                            59
To Determine the Effectiveness of Core Banking On Cash Flow



11. NEED FOR IMPROVEMENT OF THE CONCEPT.



                  PARTICULARS          FREQUENCY              PERCENTAGE
                       1.YES               10                     100

                            2.NO                         0         0
                      TOTAL                          10           100


                                            100
                               100
                                90
                                80
                                70
                                60
                        a ge
                     nt




                                50
                      e
                   rc




                                40
                pe




                                30
                                20
                                       10




                                10
                                   0
                                                              0
                                                              0




                                                  1 .Y
                                                         ES     2.N
                                                                   O
                             lars
                     pa rticu




INTERPRETATION:

The Objective of the question was to know scope for improvement of the concept. This will

help in further improvement of the concept. The percentage of the response is 100%

respectively.




 BABASAB PATIL                                                                      60
To Determine the Effectiveness of Core Banking On Cash Flow


                                            (ONLY FOR CUSTOMERS)


12. ANALYSIS DURATION OF CUSTOMERSHIP.



                       PARTICULARS                 FREQUENCY               PERCENTAGE

        1.SINCE 1 YEAR                                    26                     26
        2.SINCE 2-5 YEARS                                 43                     43
        3.MORE THAN 5 YEARS                               31                     31
                           TOTAL                         100                     100


                      50

                      45

                      40

                      35
         PERCENTAGE




                      30

                      25
                                                    43




                      20
                                                                      31




                      15
                                26




                      10

                      5

                      0
                           1.SINCE 1 YEAR    2.SINCE 2-5 YEARS   3.MORE THAN 5
                                                                    YEARS

                                             PARTICULARS




INTERPRETATION:

The objective of the question was to know the period for which the customers are the account

holders of the bank. This will reflect the relationship with the bank.26% of the customers

have been the customers of this bank since1Year,43% of the customers have been the

customers of this bank since 2-5 Years and 31% of the customers have been the customers of

this bank since last 5 years.



 BABASAB PATIL                                                                          61
To Determine the Effectiveness of Core Banking On Cash Flow


13. ANALYSIS ON AWARENESS


                       PARTICULARS                   FREQUENCY           PERCENTAGE

                            1. YES                        87                      87
                            2. NO                         13                      13
                            TOTAL                        100                      100


                      100

                      90

                      80

                      70
         PERCENTAGE




                      60

                      50
                                          87




                      40

                      30

                      20

                      10
                                                                        13




                       0
                                     1.        YES                 2.        NO
                                                     PARTICULARS




INTERPRETATION:

The objective of this question was to know the awareness of Core Banking, 87% of the

customers are aware of Core banking and another 13% of the customers are not aware of this

concept. The response from the respondents about the awareness of this concept will help the

banker to understand awareness level among the existing customers.81% of the customers are

aware of the system and this is a plus point to the bank.




 BABASAB PATIL                                                                          62
To Determine the Effectiveness of Core Banking On Cash Flow



14. UTILIZATION OF CONCEPT.


                       PARTICULARS          FREQUENCY            PERCENTAGE

                            1.YES                69                      69
                            2.NO                 31                      31
                           TOTAL                100                     100


                      80


                      70


                      60
         PERCENTAGE




                      50


                      40
                                     69




                      30


                      20
                                                                31




                      10


                      0
                                    1.YES                      2.NO
                                            PARTICULARS




INTERPRETATION:

Corporation Bank has introduced this concept for the better services for its customers.69% of

the respondents have used the concept while other 31% are just aware of the concept, but

they have never worked with the concept. Though the respondents are aware of the concept,

sometimes they have not avail the benefit of the concept. If they are taking the benefit of the

concept then we can find out the effectiveness of core banking in the banking Organization.




 BABASAB PATIL                                                                           63
To Determine the Effectiveness of Core Banking On Cash Flow


15. SATISFACTION LEVEL.



                PARTICULARS                                  FREQUENCY      PERCENTAGE
        1.VERY MUCH SATISFIED                                    25              25
        2. SATISFIED                                             53              53
        3. DELIGHTED                                             22              22
                                 TOTAL                             100              100


                      60



                      50



                      40
         PERCENTAGE




                      30
                                                        53




                      20
                                    25




                                                                             22




                      10



                      0
                           1.VERY MUCH SATISFIED    2. SATISFIED         3. DELIGHTED

                                                   PARTICULARS




INTERPRETATION:

The Objective of the question is to understand the satisfaction level of the customers. Most of

the customers are satisfied with the concept of core banking. The percentage of the

satisfaction is 25%, 53% and 22% respectively. It states that most of the customers. The

concept can be more effective if all the customers are fully satisfied with the concept.




 BABASAB PATIL                                                                             64
To Determine the Effectiveness of Core Banking On Cash Flow


16. EMPLOYEE RESPONSE TOWARDS THE CONCEPT.



                PARTICULARS                        FREQUENCY       PERCENTAGE
        1.VERY GOOD                                    28               28
        2. GOOD                                        56               56
        3. SATISFACTORILY                              16               16
                            TOTAL                     100                  100


                      60



                      50



                      40
         PERCENTAGE




                      30
                                              56




                      20
                               28




                      10
                                                                     16




                      0
                           1.VERY GOOD      2. GOOD           3. SATISFACTORILY

                                         PARTICULARS




INTERPRETATION:

The Objective of the question is to understand the employee’s response towards customers.

Most of the customers are satisfied with the employee’s response. The percentage of the

satisfaction is 28%, 56% and 16%.




 BABASAB PATIL                                                                     65
To Determine the Effectiveness of Core Banking On Cash Flow



17. ANALYSIS OF PROBLEM.



                PARTICULARS                            FREQUENCY      PERCENTAGE
        1.TIME CONSUMING                                   37              37
        2. AWARENESS                                       43              43
        3. FLEXIBILITY                                     20              20
                              TOTAL                          100               100


                      50

                      45

                      40

                      35
         PERCENTAGE




                      30

                      25
                                                  43




                      20
                                 37




                      15
                                                                        20




                      10

                      5

                      0
                           1.TIME CONSUMING   2. AWARENESS         3. FLEXIBILITY

                                              PARTICULARS




Interpretation:

The Objective of the question was to know the problem that the customers of the bank are

facing with respect to core banking. This will help in analyzing the problem with the concept

of core banking and coming out with a problem solution. The percentage of the response is

37%, 43% and 20% respectively.




 BABASAB PATIL                                                                         66
To Determine the Effectiveness of Core Banking On Cash Flow

18) As a customer which system do prefer comfortable?



                  PARTICULARS                   FREQUENCY            PERCENTAGE
        a) SMS Banking                               2                     2
        b) E-banking                                 9                     9
        c) R.T.G.S                                   5                     5
        d)N.E.F.T                                    6                     6
        e)ATM any where withdrawal                  42                    42
        f) At par cheques                           28                    28
        g) Fund transfer                             8                     8

                      TOTAL                             100                   100



  45
  40
  35
  30
  25
                                                              42




  20
  15
                                                                         28



  10
   5
                       9




                                                                                      8
                                               6
                                   5
           2




   0
         a) SMS       b) E-    c) R.T.G.S   d)N.E.F.T   e)ATM any      f) At par    g) Fund
       Banking     banking                                 where      cheques       transfer
                                                        withdrawal




Interpretation : The Objective of the question was to know the prefererence towards the

services of core banking . This will help in analyzing the preference with the concept of core

banking and coming out with a solution. The percentage of the response is 2%, 9%,5%

,6%,42%,28%,8% respectively.




 BABASAB PATIL                                                                             67
To Determine the Effectiveness of Core Banking On Cash Flow


19) Which product do you prefer in banking?



                 PARTICULARS                             FREQUENCY          PERCENTAGE
        A) S B A/C                                           30                  30
        B) Super A/C                                          6                   6
        C) Current A/C                                       16                  16
        D) O D A/C                                            8                   8
        E) F D A/C                                            7                   7
        F) Gold Loans                                         6                   6
        G) Agri Loans                                        18                  18
        H) Auto Loans                                         9                   9
                       TOTAL                                  100                100



  35

  30


  25

  20
           30




  15


  10
                                                                                  18
                                  16




   5
                                                                                            9
                                               8




                                                            7
                      6




                                                                        6




   0
       A) S B A/C   B) Super   C) Current   D) O D A/C   E) F D A/C   F) Gold   G) Agri   H) Auto
                     A/C          A/C                                 Loans     Loans     Loans




Interpretation: The Objective of the question was to know the product prefererence towards

the services of core banking. This will help in analyzing the product preference with the

concept of core banking and coming out with a solution. The percentage of the response is

30%, 6%, 16%, 8%, 7%, 6%, 18%, and 9% respectively.




 BABASAB PATIL                                                                                  68
To Determine the Effectiveness of Core Banking On Cash Flow



ANALYSIS OF CASH FLOW STATEMENT OF CORPORATION BANK


The analysis of cash flow statement of corporation bank at RNR BRANCH is for 2 years.

Since bank has introduced the concept of core banking last year i.e. the analysis of 2 years of

cash flow statement helps in knowing the growth percentage of cash flow of corporation

bank, which in turn helps in knowing the effectiveness of core banking on cash flow.


Cash flow is an accounting term that refers to the amounts of cash being received and spent

by a business during a defined period of time, sometimes tied to a specific project.

Measurement of cash flow can be used


      To evaluate the state or performance of a business or project.

      To determine problems with liquidity. Being profitable does not necessarily mean

       being liquid. A company can fail because of a shortage of cash, even while profitable.

      To generate project rate of returns. The time of cash flows into and out of projects are

       used as inputs to financial models such as internal rate of return, and net present

       value.

      To examine income or growth of a business when it is believed that accrual

       accounting concepts do not represent economic realities. Alternately, cash flow can be

       used to 'validate' the net income generated by accrual accounting.




 BABASAB PATIL                                                                           69
To Determine the Effectiveness of Core Banking On Cash Flow




                                 CORPORATION BANK

    CASH FLOW STATEMENT FOR THE YEAR MARCH 2007 AND MARCH 2006.


                                                                     (Rs. In ‘000)


                     Particulars                    Year ended 31-   Year ended 31-
                                                       03-2009          03-2008



    A. Cash flow from operating activities.           41519533        24067254




    B. Cash flow from investing activities.            872197          5005797




    C. Cash flow from financing activities.           1820585          1594266




    D. Balances at the beginning of the year:         89158549        67191358
             (cash & Balances)



    E. Balances at the end of the year:              127985300        89158549
             (cash & Balances)

    F.Total cash flow during the year (a+b+c)         38826750        21969664



(Compared to previous year there has been an increase of 43. 42% on cash flow)




 BABASAB PATIL                                                                       70
To Determine the Effectiveness of Core Banking On Cash Flow


LESS: Interest paid                        43710184           30630925
Operating expenses                        10018982            8922584
Provisions                                 9054655            5129028
Profit on sale of fixed assets             8247               3288
Dividend received from
subsidiaries
                                             50000            0
                                          62825574            44679249
ADD: depreciation                           551324            596688
Provision for contingencies                9054655            5129028
                                           9605979            5725716


Cash flow from                            18558647            13224627
operations(B.T)
LESS: Taxes Paid                          5540039             2360807
Cash flow from
operations(A.T)                        13018608               10863820
Cash flow from operating              186160656               130838891
ASSETS --
AND LIABILITIES

                                           28500925           13203434
Cash flow from operations                   41519533          24067254




Cash flow from investing           1404529                    552636
activities                              532332                46839
Addition in fixed assets                   0                  0
Dividend from subsidies
                                                              505797
                                 872197
Total

Cash flow from financing
activities                                   0                0
Increase in share capital                    0                3
Share premium                             1820585             1594269
Dividend
                                 1820585                      1594266




 BABASAB PATIL                                                            71
To Determine the Effectiveness of Core Banking On Cash Flow



                                     CORPORATION BANK

    CASH FLOW STATEMENT FOR THE YEAR MARCH 2007 AND MARCH 2006.




                         TOTAL CASH FLOW DURING THE YEAR

             140000000                         127985300

             120000000
             100000000                   89158549                                 89158549

              80000000                                                      67191358

              60000000
                          41519533                  38826751
              40000000                                     24067254                    21967191
                                     1820585
              20000000                                         505797
                              872197                                    1594266
                     0


                               09                                08
                      1-0 3-20                          1-0 3-20
                  ed 3                              ed 3
       Yea   r end                       Yea   r end




INTERPRETATION:

An analysis was being made on cash flow statement of corporation bank for a period of 2

years, which helps in knowing the growth percentage on cash flow after the introduction of

core banking, from the analysis it was found that there has been 43.42% increase in cash flow

as compared to previous years.




 BABASAB PATIL                                                                                    72
To Determine the Effectiveness of Core Banking On Cash Flow


FINDINGS


        Employees of the bank should be given proper training with respect to core
           banking.

        Customers should be educated with respect to all the benefits available with the
           core banking.

        The concept of core banking should be speeded up so that it saves the time of
           employees & customers.

        All the details with respect to core banking should be displayed at the counter hall
           so that the customers come to know the procedure instead of wasting their time.

        Customer meet should be held in the branch to introduce the product and its
           utilization for customers as a mass practical campaign.

        Detailed scheme broachers should be held at branch counters which helps the
           customers to read leisurely.

        Customers are very much comfortable at ATM & at-par cheques.

        Customers normally prefer products like S.B account , Current account &
           Agricultural loan accounts




 BABASAB PATIL                                                                         73
To Determine the Effectiveness of Core Banking On Cash Flow



                  SUGGESTIONS & RECOMMENDATIONS.

        The project analysis has helped in knowing the satisfaction level of the Employees
           based on the analysis it was found that majority of the employees are satisfied, the

           satisfaction level could further be increased if the employees are given proper

           training with respect to core banking.

        An analysis was being made on cash flow statement of corporation bank for a
           period of 2 years; from the analysis it was found that there has been an increase of

           43.42% on cash flow as compared to previous year. The growth percentage would

           further be increased if the employees of the bank are given effective and complete

           training on core banking and also by educating & increasing the awareness level

           of core banking to the customers of the bank.

        Customers of the bank are less aware of the concept of core banking so employees
           of the bank are suggested to conduct some awareness program with respected to

           core banking.

        Customers should be educated with respect to all the benefits available with the
           core banking.

        Some suggestions were given to the employees of the bank to educate & increase
           the awareness among customers. The following are the details:

                 All the details with respect to core banking should be displayed at the
                   Counter hall so that the customers come to know the procedure instead
                   of wasting their time.
                 Customer meet should be held in the branch to introduce the product
                   and its utilization for customers as a mass practical campaign.
                 Detailed scheme broachers should be held at branch counters which
                   helps the customers to read leisurely.


 BABASAB PATIL                                                                           74
To Determine the Effectiveness of Core Banking On Cash Flow


CONCLUSION


The study was conducted to understand the effectiveness of core banking cash flow of

corporation bank RNR BRANCH. To serve the state objective of the survey, the response has

been collected from employees & 100 customers of the bank & also An analysis was being

made on cash flow statement of corporation bank for a period of 2 years, which helped in

knowing the growth percentage on cash flow after the introduction of core banking, from the

analysis it was found that there has been an 43.42% increase on cash flow as compared to

previous years.

                  This shows that the introduction of core banking has made a significant

impact on cash flow of corporation bank at RNR BRANCH. The growth percentage would

further be increased if the employees of the bank are given effective and complete training on

core banking and also by educating & increasing the awareness level of core banking to the

customers of the bank.

                   Everything has been taken into account to judge the effectiveness. To

conclude with the concept of core banking has made a significant effect on cash flow of

corporation bank at RNR BRANCH.




 BABASAB PATIL                                                                          75
To Determine the Effectiveness of Core Banking On Cash Flow




                                   QUESTIONNAIRE


Dear sir/madam




Name              : _____________________________________________________

Address           : _____________________________________________________

E-mail            :_____________________________________________________
Mobile No         : _____________________________ Ph No _________________



                                  (ONLY FOR EMPLOYEES)


1. How long you have been working in this bank?

       a) Since 1 year            b) since 2-5 years       c) More than 5 years


2. How much are you satisfied with the concept of core banking solutions?

         a).Very much satisfied

         b).Satisfied

         c).Delighted


3. Do you believe that Core Banking Solutions is really helping customers of this Bank?

         a) Yes                   b) No



4. Do you think that concept of core banking solutions helps in increasing the cash flow?

         a) Yes                   b) No

 5. Does the concept of core banking saves time & money of employees & customers of this
bank?

 BABASAB PATIL                                                                          76
To Determine the Effectiveness of Core Banking On Cash Flow


       a) Yes                   b) No

 6. Which of the concepts do you feel is easier and advantage?

        a) IBAS                       b) Core Banking Solutions?

7. Has bank given you any training program with respect to core banking?

       a) Yes                   b) No

8. If yes how much are you satisfied with the training program?

       a).Very much satisfied

       b).Satisfied

       c).Delighted

9. Does the concept of core banking solutions have any draw backs?

       a) Yes                   b) No

10. As an Employee what problems do you face with the core banking concept?

       a). Lack of Training

       b). Awareness

       c). Time consuming


11. Do you think there is a need to improve in the concept of core banking?

       a).Yes                 b) No




                                (ONLY FOR CUSTOMERS)


12. How long you have been the customer of this bank?

       a) Since 1 year            b) since 2-5 years          c) More than 5 years



 BABASAB PATIL                                                                       77
To Determine the Effectiveness of Core Banking On Cash Flow


13. Do you know that bank has introduced the concept of core banking?

       a) Yes                   b) No


14. Did you ever use the concept of Core Banking Solutions?

       a) Yes                   b) No


15. How much satisfied are you with the concept of core banking solutions?

       a).Very much satisfied

       b).Satisfied

       c).Delighted


16. How well does the employees of the bank response to the concept?

       a).Very Good

       b).Good

       c). Satisfactorily


17. As a customer what problems do you face with the core banking concept?

       a). Time consuming

       b). awareness

       c). Flexibility




18) As a customer which system do prefer comfortable?

A) SMS Banking

B) E-banking

c) R.T.G.S


 BABASAB PATIL                                                               78
To Determine the Effectiveness of Core Banking On Cash Flow


D) N.E.F.T

E) ATM any where withdrawal

f) At par cheques

g) Fund transfer


19) Which product do you prefer in banking?)

A) S B A/C

b) Super A/C

c) Current A/C

D) O D A/C

E) F D A/C

F) Gold Loans

g) Agri Loans

h) Auto Loans


                      THANKS FOR YOUR COOPERATION




                               BIBILOGRAPHY


        BOOKS:

          M.Y.KHAN and P.K. JAIN (1981). Management Accounting, New Delhi:

          Tata McGraw-HILL Publishing Company Limited.

 BABASAB PATIL                                                       79
To Determine the Effectiveness of Core Banking On Cash Flow



        REPORTS

           Corporation bank (2009).Annual Report, Manglore.


        WEB SITES
               http://www.corpbank.com

               http://www.google.com

               http://www.encyclopedia.com

               http://www.wikipedia.com

               http://www.tutor2u.com




 BABASAB PATIL                                                80

				
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babasab patil babasab patil management trainee https://sites.google.com/site/babambafinance/
About is presently working for ASHOK IRON group Belguam he has completed his MBA master degree in Finance from Basaveshwar Engineering College, Bagalkot.(Autonomous)Patils some majour projects are Organization : GIOJIT PNB PARIBAS Financial Services Ltd Bagalkot.Project Title:A Study on Technical Analysis of Automobile Sector. Organization :S S H S K LTD NIPANI.  Project Title :A study on Ratio Analysis of SSHSK LDT Nipni.