CHAPTER -1

INDUSTRY PROFILE AND COMPANY PROFILE

INTRODUCTION ABOUT PROJET :

"Loans and Advances with Special References to Kempegowda Pattana Souharda Sahakari Bank
Ltd," Tumkur, study done.

Project work is an essential component of the VTU MBA academic curriculum. It is a good
platform for exploring our knowledge and understands the various skills required to enter a
specific area of operation. It helped in understanding the theoretical knowledge and apply it in
real time. It also provides an understanding of professional cultures, allows for the analysis of
work place settings, and provides platforms for comparing different working styles.

The main goal is to understand the about lending system in Bank in the form of loans and
advances. "Loans and Advances," a topic dealing with the bank's lending activity. The public
will borrow loans from banks for several purposes. By granting loans individuals, bank in turn is
providing them build financial aid to promote or establish the business. An effort has been made
to understand the various lending under different categories. How the recovery of these loans are
being made and also to see if there is any impact on financial health of the bank due to their
lending and recovery.

In fact, the purpose of the study was to analyse and make recommendations based on data from
the previous five fiscal years.
INDUSTRY PROFILE

INTRODUCTION :

As per the Reserve Bank of India (RBI), India’s banking sector is sufficiently capitalised and
well-regulated. The financial and economic conditions in the country are far superior to any
other country in the world. Credit, market and liquidity risk studies suggest that Indian banks are
generally resilient and have withstood the global downturn well.

Indian banking industry has recently witnessed the roll out of innovative banking models like
payments and small finance banks. RBI’s new measures may go a long way in helping the
restructuring of the domestic banking industry.

The digital payments system in India has evolved the most among 25 countries with India’s
Immediate Payment Service (IMPS) being the only system at level five in the Faster Payments
Innovation Index (FPII).

Market Size :

The Indian banking system consists of 12 public sector banks, 22 private sector banks, 46 foreign
banks, 56 regional rural banks, 1485 urban cooperative banks and 96,000 rural cooperative banks
in addition to cooperative credit institutions As of September 2021, the total number of ATMs in
India reached 213,145 out of which 47.5% are in rural and semi urban areas.In FY18-FY21,
bank assets across sectors increased. Total assets across the banking sector (including public and
private sector banks) increased to US$ 2.48 trillion in FY21.In FY21, total assets in the public
and private banking sectors were US$ 1,602.65 billion and US$ 878.56 billion,
respectivelyDuring FY16-FY21, bank credit increased at a CAGR of 0.29%. As of FY21, total
credit extended surged to US$ 1,487.60 billion. During FY16-FY21, deposits grew at a CAGR
of 12.38% and reached US$ 2.06 trillion by FY21. Bank deposits stood at Rs. 162.41 trillion
(US$ 2.17 trillion) as of December 31, 2021.According to India Ratings & Research (Ind-Ra),
credit growth is expected to hit 10% in 2022-23 which will be a double-digit growth in eight
years. According to the RBI, bank credit stoodRs. 116.8 lakh crore (US$ 1.56 trillion) on 31st
December 2021.As of February 2022, credit to non-food industries stood at Rs. 114.10 trillion
(US$ 1.53 trillion).
INVESTMENTS :

Key investments and developments in India’s banking industry include:

 As of February 21, 2022, the number of bank accounts—opened under the government’s
flagship financial inclusion drive ‘Pradhan Mantri Jan Dhan Yojana (PMJDY)’—reached
44.63 crore and deposits in the Jan Dhan bank accounts totalled Rs. 1.58 trillion (US$
21.25 billion).

 On November 09, 2021, RBI announced the launch of its first global hackathon
'HARBINGER 2021 – Innovation for Transformation' with the theme ‘Smarter Digital
Payments’.

 In November 2021, Kotak Mahindra Bank announced that it has completed the
acquisition of a 9.98% stake in KFin Technologies for Rs. 310 crore (US$ 41.62 million).

 In July 2021, Google Pay for Business has enabled small merchants to access credit
through tie-up with the digital lending platform for MSMEs—FlexiLoans.

 In December 2020, in response to the RBI’s cautionary message, the Digital Lenders’
Association issued a revised code of conduct for digital lending

 On November 6, 2020, WhatsApp started UPI payments service in India on receiving the
National Payments Corporation of India (NPCI) approval to ‘Go Live’ on UPI in a
graded manner.

 In October 2020, HDFC Bank and Apollo Hospitals partnered to launch the ‘HealthyLife
Programme’, a holistic healthcare solution that makes healthy living accessible and
affordable on Apollo’s digital platform.

 In 2019, banking and financial services witnessed 32 M&A (merger and acquisition)
activities worth US$ 1.72 billion.In March 2020, State Bank of India (SBI), India’s
largest lender, raised US$ 100 million in green bonds through private placement.

 In February 2020, the Cabinet Committee on Economic Affairs gave its approval for
continuation of the process of recapitalization of Regional Rural Banks (RRBs) by
providing minimum regulatory capital to RRBs for another year beyond 2019-20 - till
2020-21 to those RRBs which are unable to maintain minimum Capital to Risk weighted
Assets Ratio (CRAR) of 9% as per the regulatory norms prescribed by RBI .
 GOVERNMENT INITIATIVES:

 National Asset reconstruction company (NARCL) will take over, 15 non-performing

loans (NPLs) worth Rs. 50,000 crores (US$ 6.70 billion) from the banks.

 National payments corporation India (NPCI) has plans to launch UPI lite this will provide
offline UPI services for digital payments. Payments of upto Rs. 200 (US$ 2.67) can be
made using this.

 In the Union budget of 2022-23 India has announced plans for a central bank digital
currency (CBDC) which will be possibly known as Digital Rupee.

 National Asset reconstruction company (NARCL) will take over, 15 Non performing
loans (NPLs) worth Rs. 50,000 crores (US$ 6.70 billion) from the banks.

 In November 2021, RBI launched the ‘RBI Retail Direct Scheme’ for retail investors to
increase retail participation in government securities.

 The RBI introduced new auto debit rules with a mandatory additional factor of
authentication (AFA), effective from October 01, 2021, to improve the safety and
security of card transactions, as part of its risk mitigation measures.

 In September 2021, Central Banks of India and Singapore announced to link their digital
payment systems by July 2022 to initiate instant and low-cost fund transfers.

 In August 2021, Prime Minister Mr. Narendra Modi launched e-RUPI, a person and
purpose-specific digital payment solution. e-RUPI is a QR code or SMS string-based e-
voucher that is sent to the beneficiary’s cell phone. Users of this one-time payment
mechanism will be able to redeem the voucher at the service provider without the usage
of a card, digital payments app, or internet banking access.

 As per Union Budget 2021-22, the government will disinvest IDBI Bank and privatise
two public sector banks.

 Government smoothly carried out consolidation, reducing the number of Public Sector
Banks by eight.
ACHIEVEMENTS:

Following are the achievements of the Government:

 In March 2022, Unified Payments Interface (UPI) recorded 4.62 billion transactions
worth Rs. 7.32 trillion (US$ 125.8 billion).

 According to the RBI, India’s foreign exchange reserves reached US$ 689.19 billion as
of January 18, 2022

 To improve infrastructure in villages, 204,000 point of sale (PoS) terminals have been
sanctioned from the Financial Inclusion Fund by National Bank for Agriculture & Rural
Development (NABARD).

 The number of transactions through immediate payment service (IMPS) reached 430.67
million and amounted to Rs. 5.70 trillion (US$ 39.75 billion) in October 2021.

ROAD AHEAD :
Enhanced spending on infrastructure, speedy implementation of projects and continuation of
reforms are expected to provide further impetus to growth in the banking sector. All these factors
suggest that India’s banking sector is poised for a robust growth as rapidly growing businesses
will turn to banks for their credit needs.

Also, the advancement in technology has brought mobile and internet banking services to the
fore. The banking sector is laying greater emphasis on providing improved services to their
clients and upgrading their technology infrastructure to enhance customer’s overall experience as
well as give banks a competitive edge.

India’s digital lending stood at US$ 92 billion in FY18 and is estimated to reach US$ 2 trillion
by FY23 driven by the five-fold increase in the digital disbursements. By 2025, India's fintech
market is expected to reach Rs. 7.2 trillion (US$ 86.48 billion).
FUNCTIONS OF BANK:

1. Accepting the deposits:

 Demand deposits:

It is also known as current deposits are those which can be withdrawn by depositor any time by
means of cheques. Bank does not pay any interest on demand deposits, it is convenient for the
businessmen to pay creditors by drawing cheques and also get the cheques received by them
collected

 Savings deposits:

Savings deposits on which the bank pays a certain percentage of interest to depositors, but the
bank abode certain restrictions on their withdrawals.

 Fixed deposits:

Fixed deposits are those deposits which can be withdrawn after expiry of a specified fixed
period. These are also called as time deposits the rate of interest is more than allowed on saving
deposits.

2. Lending of funds

 Loan:
Loan is a financial accommodation under which bank grants an advances a separate
account called loan account. Interest was changed on the entire amount of loan
sanctioned loans are given to all types of persons be the personal security of the borrower
or beside the personal movable or immovable proper.
 Overdraft :
An overdraft is a financial accommodation under which a current account holder was
allowed to overdraft his account up to an agreed limit, interest is charged on the exact
amount overdraft by the customer. It is granted against the security of the borrower.

 Cash credit:

A cash credit is a financial accommodation under which an advances is granted on a

separate account called cash credit account up to a specified limit. Interest is changed on
the amount made use by the borrower it is granted against the security of goods or
personal security of one or more persons other than borrower.
 STRUCTURE OF INDIAN BANKING SYSTEM
The modern banking system in India was evolved to meet the financial needs of trade and
industry and also satisfy the institution of the country.

Bank can be Dividend in to 2 types:

 Scheduled bank
 Non-scheduled bank

CO-OPERATIVE BANK AND CREDIT SOCIETY

These are established with the main intention of meeting the people in the rural area with their
requirements. Usually, these banks are governed under the rules and regulation of co-operative
bank , which are framed by co-operative members. Not only rules of co-operative bankis
applicable, even the some provisions of banking regulation act, 1949 is applied.

The co-operative societies are classified on the basis of geographical area that is state co-
operative bank, district co-operative banks and primary co-operative society. The strategy is to
provide financial assistance and the development of agriculture with the time period of short
term and the medium term is given for the seeds, fertilizers and implements etc. for the formers.
 INDIAN BANKING STRUCTURE

Reserve Bank of India

Scheduled bank Non -Scheduled banks

Co-operative Bank Commercial Bank

State Co-operative Urban Co-operative Public sector Private Regional

Foreign banks
bank bank banks sector Rural banks
banks

StateBank of Other Public

Nationalized Banks
India
SCHEDULED BANK

The schedule bank is one which is registered in the second the reserve bank of India. It is away
under the domain of the different credit control measures of the RBI. They are required to keep
up a specific minimum balance in their records with the RBI.

The scheduled banks are qualified borrowings and re-discounting offices from the reserve bank
of India.

Schedule bank classified into two types:

1. Schedule co-operative bank:

Co-operative banks came in to existence with the development of the co-operative bank
act of 1904 which accommodated the arrangement of co-operative societies.
FURTHER IT ISDIVIDED IN TO 2 TYPES CO-OPERATIVE BANKS:

• State co-operative:

This bank is a federation of central co-operative bank and acts watch of the co-
operative banking structure in the state. The state co-operative banks lend money
to central cooperative bank and primary societies and not directly to the
agriculturists.

• Urban co-operative bank:

The urban co-operative bank thought not formally defined refers to co-operative
banks located in urban and semi urban region. Urban co-operative banks are
permitted to lend money only for non-agricultural purposes .

2. Scheduled commercial banks:

These banks are those included in the second scheduled of RBI act 1934. The banker in
one who in the conventional course off his business and get cash which he repays by of
peoples from whom or on whose account he receives it.
 • Public sector banks:
It is a bank in which the government has a major holding it is divided in to 2 types

1) State bank of India

2) Nationalized bank

• Private sector banks:

It is a bank in which larger part of state or hold by private individual people.

• Regional rural banks:

This Banks are conceived has institution that combines the local feel and
familiarity with rural problems.

• Foreign banks:

This banks are foreign in origin and which have their head work places a situated
outside in India. This Banks are also called as exchange banks.

NON-SCHEDULED BANK

The banks which are excluded in the second schedule of the RBL non-scheduled banks are not
qualified for every one of those offices that the scheduled banks benefit of from the RBI the
banking regulation act 1949 non-scheduled banks have likewise gone under the RBI control.
 COMPANY PROFILE

BACKGROUND & HISTORY OF THE BANK:

Kempegowda Pattana Souharda Sahakari Bank Limited Popularly Known as KEMPEGOWDA

BANK’ is one of the reputed Co-operative Bank in Tumkur District of Karnataka State,
functioning with its registered office at 4th Cross, Ashokanagara, Tumkur. The chief promoters
of the Bank are Sri.H.S.Seshadri Senior Advocate, Sri S. Putteerappa Social Worker, Sri R.
DoddalingappaRtd Asst. Director of fisheries, Sri. LingannaRtd ASO Statistical Dept. Sri R.
Kamaraj Editor Gangavahini, Sri A.N. GovindarajRtd Special D.C., and others.

The Kempegowda Pattana Souharda Sahakari Bank Ltd., popularly known as “KEMPEGOWDA
BANK” was incorporated on 08-05-1998 by registering at Assistant Registrar of Co-operative
Societies Tumkur Division, Tumkur with a register No: ART/RCS No.24507/1998-99 under The
Karnataka State Co-operative Societies Act, 1959 in the name of KempegowdaPattanaSahakari
Bank Ltd with 2,982 members and authorized capital of Rs. 50.00Lakhs and again The Bank was
incorporated on 12-03-2003 as “ KEMPEGOWDA PATTANA SOUHARDA SAHAKARI
BANK LTD.,” by registering at Registrar of Cooperative societies at Bangalore with a register
No. RSR:SOUKAA:173:NONDANI:073:2001-02 under The Karnataka State SouhardaSahakari
Act, 1997.

The KEMPEGOWDA BANK was inaugurated by his holiness JAGADGURU SRI SRISRI
BALAGANGADHARANATHA SWAMIJI PONTIFF OF ADICHINCHANAGIRI MUTT &
SRI SRISRI NANJAVADOOTHA SWAMIJI PONTIFF OF SRI GURUGUNDA
BRAMHESWARA MUTT PATTANYAKANAHALLI and stared its business on 04-04-1999 at
Vidyodaya Law College Complex, Kunigal Road, Tumkur later the place of business shifted to
its own building at4th cross, Ashokanagar, Tumkur. Sri.H.S.SESHADRI& Sri.
S.PUTTEERAPPA are the founder President &VicePresident of the KEMPEGOWDA BANK
respectively and both of them continues to be the president and Vice-president of the bank. Bank
has made considerable progress between 1999 and till now, when there were only 2,982
members having share capital of Rs.32,32,000/-. Since then there is considerable increase of
members joining the bank.
KEMPEGOWDA BANK is fully computerized Bank and Bank offering good and services to its
customers and Bank is increasing its profits over the years .

Objectives and goals of Kempegowda Pattana Souharda Sahakari Bank:

The bank is working with the following objectives and goals:

1. To encourage theft, self help and co – operation among the member / associated and
normal members and deposits of the bank.
2. To banking section business as defined under section 5 (b) of the banking regulation
Act, 1949 (as applicable to co – operative societies) and also engage in such other
business is permitted under section of the raid act.
3. To mobilize or borrow funds.
4. To prepare and finance projects to improve the economic conditions of the members
particularly those belonging to the weaker sections of the society.
5. To lend money to its members on hire purchase / hypothecation of the motor vehicles as
defined in the motor vehicles act.
6. To passes, acquire alter or consultant site / building etc., for the use and convenience of
business of the bank.
7. To issue to accept, to sell or purchase .
8. To invest surplus funds of the bank in Government securities, debentures, share loan
bonds of such co-operative societies which are guaranteed by the Government and other
institutions as are permitted under section 58 of the act.
9. To issue demand draft as the customer requirement throughout India.

THE MAIN SOURCES OF FUNDS

1. Savings Deposits
2. Fixed Deposits
3. Current Deposits
4. Regular Deposits
BOARD OF DIRECTORS AT THE TIME OF ESTABLISHMENT IN THE
YEAR 1999 .

DIRECTORS:
1. SRI.HS SHESHADRI
2. SRI.S PUTTIRAPPA
3. SRI.R. KAMARAJ
4. SRI. Dr. G. PARAMESHWAR
5. SRI.A N GOVINDRAJU
6. SRI.L LINGANNA
7. SRI.R DODLINGAPPA
8. SRI.K RAMSANJEVIAH
9. SMT. CHANDRA CHIDAMBARAIAH
10. SRI.B MARULIAH
11. SRI.V H ANJANAPPA

INVITEES:
1. SRI.B.MARULAIAH
2. SRI. V.H.ANJANAPPA

THE FINANCIAL POSITION OF THE BANK AS AT THE END OF FIRST YEAR 31-03-
2022
TABLE -01
PARTICULARS AMOUNT (RS)
No of Members 4 ,636
Share Capital 12,423,800.00
Deposits 521,904,434.16
Loans and Advances 362,105,945.92
Investments 136,283,753.00
Net Profit 60,81,902.97

PRESENT BOARD OF DIRECTORS

1. SRI.H.S. SESHADRI PRESIDENT

2. SRI. LINGANNA L VICE-PRESIDENT
DIRECTORS:

1. SRI. R. DODDALINGAPPA

2. SRI.R. KAMARAJ

3. SRI. SIDDALINGAIAH

4. SRI SHIVARAMAIH

5. SRI. H.L. CHANDRASHEKHARA GOWDA

6. SMT.NAGAVENI L

7. SMT. SHAILA KUMARI B

8. SRI. ANIL KUMAR G R

9. SMT. REKHA S

10. SMT. MAHALAKSHMI K N

11. SRI. R SIDAPPA

12. SRI. M JAYRAMSHETTY

Address of Bank

Kempegowda Pattana Souharda Sahakari Bank Niyamitha

4 th Cross, Ashok Nagara, Tumkur-572102

Various sections in bank:

1. Administrative section / department

2. Loans sections

3. Recovery of loans section

4. Deposit section

5. Accountant section

6. Computer section.

Business Hours:

Monday - Friday: Working Hours: 10.00 AM to 5.30 PM

Saturday: Working Hours: 10.00 AM to 5.00PM

Sunday: Holiday

LOAN FACILITIES

SL PARTICULARS RATE OF TERM /

NO INTEREST P.A. DURATION

1. Property or mortgage Loan 12% 120 To 180 months

2. House loan / construction 10.5% 120 To 180 months

3 Vehicle Loan (only new 12% 30 To 60 months

vehicle )

4. Personal Loan 14.00% 6 months

5. Joint Loan 16% 6 months

6. Over draft Loan 13 % 1 year

7. Staff Loan 7% 1 Year

RATE INTEREST ON DEPOSITS .

SLNO Term / Duration of deposit Rate of interest

P.A.

1 30 Days To 90 Days 3.00%

2 91 Days To 180 Days 4.00%
3 181 Days Up To 1 Year 5.00%
4 Above 1 Year Up To 2 Year 5.50%
5 Above 2 Year Up To 3 year 6.00%
6 Above 3 Year 5.50%
For senior citizen (60 and above ) additional 0.50% P.A
Interest will be given on Deposits of above one year .

SWOT Analysis:

SWOT is the acronym for strength, weakness, opportunities and threats. Strengths are the
internal. Positive Characteristics that the company processes. One look at these competitive
advantages. Weaknesses are internal as well and are the negative aspects of the company and
indicate competitive vulnerabilities. These should be distinguished from problems such that
immediate collapse is not likely. Weakness should be overcome in order to achieve future
growth and improvement of the company. Threats are external to the company and action is
required.

STRENGTHS :

Strengths are advantages that a company holds over its competitors.

1. Centralized services.
2. High security.
3. Improved Customer Experience .
WEAKNESS:
Weaknesses are disadvantages that a company has which hampers its growth ,these factors
should be reduced as much as possible .

1. Visibility .
2. Lack of ATMs .
3. Low customer credibility.

OPPORTUNITIES:
Opportunities are useful factors that help the company get some specific goals on which they can
work to grow .

1. NPA .
2. Personalized offers / discounts.
3. Coverage in Rural Areas .

THREATS :

Threats are potential harms that need to be addressed to avoid any losses of the company .

1. Economic Slowdown .
2. Highly competitive Environment.
3. Monopolization.
 FINANCIAL STATEMENT:

BALANCESHEET OF KEMPEGOWDA PATTANA SOUHARDA SAHAKARI

BANK LIMITED from 31-03-2018 to 31-03-2022

Capital and 2017-18 2018-19 2019-20 2020-21 2021-22

Liabilities

Share capital 1,39,29,400.00 1,38,21,600.00 1,31,66,900.00 1,24,23,800.00 1,22,74,500.00

Reserves fund 7,62,76,511.27 8,85,81,721.18 10,34,94,834.9 12,06,95,361.7 13,76,56,629.69

and other 9 2
reserves

Deposits and 41,72,71,601.0 50,04,35,448.7 53,81,30,093.3 52,19,04,434.1 53,76,59,538.26

other accounts 5 1 8 6

Borrowings - - - - -

Bills for - - - - -
collcetion being
bills receivables

Branch 95,87,782.50 41,25,595.50 42,15,961.00 1,70,91,011.00 1,94,95,848.22

Adjustments

Over due interest 10,93,040.00 11,74,560.00 16,38,367.00 19,36,876.00 17,94,074.00

reserve on non
performing
assets

Interest payable 3,18,232.00 4,31,351.00 3,40,842.00 2,22,213.00 2,30,986.00

Other Liabilities 27,69,189.00 41,17,337.97 32,59,481.76 42,40,296.62 54,13,934.64

Merged banks - - 16,90,307.00 18,77,507.00 -

collection
account
payable/Deffere
d tax Liability.

Profit and loss 76,98,770.91 62,05,726.81 64,97,572.73 60,81,902.97 48,45,575.22

account

Total Current 52,89,44,527.6 61,88,93,341.1 67,24,34,359.8 68,64,73,402.6 71,93,71,086.03

Liability 3 7 6 9

Contingent
Liabilities : 10,93,040.00 11,74,560.00 16,38,367.00 19,36,876.00 17,94,074.00
Over due interest
on NPA
Letters of credit - - - - -
issued

Total Liability 52,78,51,487.6 61,77,18,781.1 67,07,95,992.8 68,45,36,526.6 71,75,77,012.03

3 7 6 9

Property and
Assets

Cash and bank 24,54,865.00 39,44,303.00 20,18,206.00 19,43,457.00 27,36,319.00

balances

Balances with 749,47,849.23 7,52,25,833.58 8,87,18,944.39 10,14,59,865.1 9,34,37,038.27

other banks 8

Money at call 2,60,00,000.00 2,80,00,100.00 4,49,99,900.00 4,99,97,900.09 -

and short notice

Investments 8,60,98,976.00 13,55,22,036.0 11,13,29,322.0 13,62,83,753.0 23,10,16,729.02

0 0 0

Advances 30,73,58,427.9 34,78,63,998.8 39,43,78,611.4 36,21,05,945.9 35,58,21,646.52

0 0 2 2

Interest
receivable

*Interest on
deposits and 8,93,917.00 9,46,801.00 11,07,942.27 15,94,177.00 22,00,902.00
securities.

*Overdue 10,93,040.00 11,74,560.00 16,38,367.00 19,36,876.00 17,94,074.00

interest on loans
and advances.

Branch 95,87,782.50 41,25,595.50 42,15,961.00 1,70,90,811.22 1,94,95,848.22

adjustments

Bills receivable - - - - -
being bills for
collection.

Premises less - - - - 1,03,42,594.00

depreciation

Fixed assets 1,49,16,221.00 1,40,09,042.00 1,32,33,467.00 1,25,60,776.00 13,67,434.00

Other assets: 55,93,449.00 80,81,071.29 1,07,93,638.78 14,99,841.28

*P&M 2,61,194.00

*Miscellaneous 8,97,307.00

Non banking - - - - -
assets acquired
in satisfaction of
claims

Deferred tax - - - - -
assets

Total performing 52,89,44,527.6 61,88,93,341.1 67,24,34,359.8 68,64,73,402.6 71,93,71,086.03

Assets 3 7 6 9

Over due interest 10,93,040.00 11,74,560.00 16,38,367.00 19,36,876.00 17,94,074.00

on NPA

Letter of credit - - - - -
Issued

Total Assets 52,78,51,487.6 61,77,18,781.1 67,07,95,992.8 68,45,36,526.6 71,75,77,012.03

3 7 6 9

STATEMENT OF PROFIT AND LOSS OF KEMPEGOWDA PATTANA

SOUHARDA SAHAKARI BANK LIMITED from 31-03-2018 to 31-03-2022.

PARTICULARS 2017-18 2018-2019 2019-20 2020-2021 2021-22

INCOME

Other incomes

Interest & discount 5,27,32,075.75 5,60,65,447.00 6,58,33,320.37 6,31,09,967.00 57,37,744.33

Commission ,excha 38,259.00 220,831.00 15,503.00 12,839.00 15,087.00

nge& brokerage

Subsidies & - - - - -

Donations

Income from non - - - - -

banking assets &

profit.

Other Receipts 11,14,781.73 10,93,684.18 12,89,673.10 9,59,132.56 12,29,642.21

Profit on sale of - 19,35,798.51 24,85,406.39 20,23,649.36 22,74,325.77

investments

Total Income 5,38,85,116.48 5,91,15,760.69 6,96,23,902.86 6,61,05,587.92 6,08,90,799.31

EXPENSES

Interest on 2,85,63,997.00 29998465.00 35677083.00 32515242.00 29394651.0

deposits ,Borrowing 0
,etc

Salaries 60,65,838.00 8096365.00 9704725.00 9762902.00 9719950.00

&allowances &
provident funds

Directors & local - - - - -

Committee
member’s fees
&allowances

Rent ,taxes,insuranc 7,60,142.00 811546.04 1038002.27 1114612.72 1104448.85

e ,lighting etc

1038002.27 1114612.72 73861.00 32195.00 44222.00 57405.00

Auditor’s fees 66,000.00 223000.00 178000.00 200000.00 230000.00

Depreciation & 12,47,257.00 1043671.92 989555.00 938679.76 809178.26

repairs

Stationary ,printing 2,70,609.00 286163.66 276785.00 304518.00 279119.00

& advertisement

Other 10,40,341.57 1218983.26 1903432.86 1208161.47 985730.98

expenditure
 CHAPTER -02

CONCEPTUAL BACKGROUND OF THE STUDY AND

LITERARUTRE REVIEW

2.1 THEORETICAL BACKGROUND OF THE STUDY

The main business of the bank is lending money and improves the economic conditions of
members through granting loans and advances.

Most important activities of the banks are granting loans and advances this is because advances
are chief source of the profit for the bank further advances enable trade, industry and commerce
to meet their financial requirements.

LENDING OF MONEY :

The commercial bank lends money in four different ways .

1. Direct Loans
2. Cash Credit
3. Overdraft
4. Discounting of bill

To great loans and advances for many reasons, some reasons are as follows:

 To Possess acquire, alter or construct site\building.

 To the members on hire purchase\hypothecation of motor vehicle.
 To small scale cottage transport operation and self-employed professional to promote their
business.

2.2 Meaning of Loans and Advances :

LOANS

The amount lent by the lender to the borrower for a specific purpose like the construction of the
building, capital requirements, purchase of machinery and so on, for a particular period of time is
known as Loan. In general, loans are granted by the banks and financial institutions. It is an
obligation which needs to be repaid back after the expiry of the stipulated period.

The loan carries an interest rate on the debt advanced. Before advancing loans, the lending
institution checks the credit report of the customer, to know about his credibility, financial
position and capacity to pay.
Loan is classified in the following categories:
On the basis of Security:

1.Secured Loan:A Secured loan is a loan backed by collateral financial assets you own like a
home or a car that can be used as payment to the lender if you don’t pay back the loan .

2.Unsecured Loan:Unsecured loans are debt products offered by banks credit unions and online
lenders that aren’t backed by collateral .

On the basis of Repayment:

1. Demand Loan: The loan which is repaid on demand of the lender is Demand Loan.

2. Time Loan: Loan, which is repaid in full at a future specified date is Time Loan.

3. Instalment Loan: Loans which are to be repaid in evenly distributed monthly instalments is
Instalment Loan.

On the basis of Purpose:

1. Home Loan

2. Car Loan

3. Education Loan

4. Commercial Loan

5. Industrial Loan

ADVANCES

Advances are the source of finance, which is provided by the banks to the companies to meet the
short-term financial requirement. It is a credit facility which should be repaid within one year as
per the terms, conditions and norms issued by Reserve Bank of India for lending and also by the
schemes of the concerned bank.

They are granted against securities which are as under:

1. Primary Security: Hypothecation of Debtors, Stock Pro-notes, etc.

2. Collateral Security: Mortgage of land and buildings, machinery, etc.

3. Guarantees: Guarantees given by partners, directors or promoters, etc .

 2.3 Various types of Loans and Advances :
1. Life insurance policies
2. Real Estates (land ,buildings,etc.)
3. Fixed deposit receipt (FDR)
4. Finacial Securities (Share and Debentures)
5. Gold Ornaments , jewellery etc.
6. Safety of movable or permanent property .
7. Hypothecation of stocks .

2.4 Purpose of Loans and Advances :

On the bases of the purpose ,the loan is granted for ,loan can be sorted out into the
following .
1. Commercial loans .
2. Industrial loans .
3. Agricultural loans .
4. Educational loans .
5. Medical loans .

The following are the forms of bank advances:

1. Short term loans: Advance in which the entire amount is provided to the borrower at one
time.

2. Overdraft: A facility provided by the bank in which the customer can overdraw money from
his account up to a specified limit.

3. Cash Credit: A facility granted by the bank in which the customer can advance money up to
a certain limit against the asset pledged.

4. Bills Purchased: An advance facility provided by the bank against the security of bills.
The role played by banks in business world by way of loans and advances are as
follows-
1. Bank does not interfere with the use, management and control of borrowed money but takes
care to ensure that the money lent is used only in business purpose.
2. Loan and advances are utilized for making payment of current liabilities, wages and salaries
of the employees and also the tax liability of business.
3. Loan and Advances from banks are found to be economical for traders and businessman
because banks charge a reasonable rate of interest on such loans and advances.
4. Loan and advances can be arranged from banks in keeping with the flexibility in business
operation.
5. Loan and advances by Banks generally carry element of secrecy with it. Banks are duty-
bound to maintain secrecy of their transactions with the customers.

2.5 Review of Articles / Literature

1. Charles B. Dodson, Bruce L. Ahrendsen, (2018)

They stated that loans necessitating more complex loan modifications and borrowers with
previous loans restructuring. Huge systems little equity in loan collateral. The small or no capital
and or little to no fluidness are less likely to perform following loans restructuring. Which could
suggest a following possible futility in a providing concessions to these type of borrowers.

2. Riddhi Bhandari, (2017)

He stated that this chapter examines how the everyday appearance that are fostered with the
circulation of debt implementing the socioeconomic order in which they operate. Employing the
theoretical work frame of "circuits of commerce, scholars have examined how social relations
and the economic actions intertwine, are negotiated and transformed through the transferring of
debt. The focus of such studies has been on the impressing of actors, such as the anticipating for
relationship-making, and structural conditions.

3. Amithghosh, (2016)

He stated that Greater capitalization, liquidity and the over-hera costs reduces real estate lending.
While banks diversification and the structure of the banking industry in every state enlarge such
lending. However the real estate loans are originate to be procyclical to state economic cycles
with a rise in state level gross domestic.
 4. G. Sathish June, (2016)

He tells that Cooperative Banking System has two large systems i.c. urban and rural
cooperatives, creates an integral part of the India's Financial System. Urban Cooperative Banks
plays an important role as financial intermediaries in measuring to the credit requirements of
both priority sector and sick section of the communities.

5. Esther Laryea, Matthew Ntow-Gyamfi, Angela AzumahAlu, (2016)

They explains that the study discoveries new evidence of the bank definite factors as well as
microeconomic factors finding NPIs. Inflation and industry concentratrion as not well in
substantial in determining NPLs.

6. B. Katti Guest Lecturer, Dr. Rathod Motilal. (2016)

When one thinks to satisfy his needs, he must required to follow the principle "I for you and you
for me. Loan is an art because they tradeing with other people's money deposited with the full
confidence that it will be repayable on the due date. Loans are confirming for future payments
from the point of view of borrower.

7. Sathyajit dhar , Avijit Bakshi, (2015)

They explains that certain bank definite factors, in particular net interest margin and capital
adequacy ratio exhibit the negative and significant impact on the gross non performing advances
(GNAP) ratio of Indian PSBs. And such a result is relationship is statistically significant with it.

8. Richard Barkham, Malcolm Frodsham, (2015)

They evaluated that the purpose of this is to be ensure an in suggestion of the earnings to the
commercial assets advancing over the last 30 centuries in United-kingdom. An average over the
long-term debt returns is higher than equity returns however in a particular period, the losses
affected by the real estate lenders.

9. $ Radhika. (2015)

She stated that loans and advances is a being part of the bank, because until and unless the
success of this department is involved. The survival is a question to every banks in the world. If
this section do not accurately work the Bank itself as bankrupt. This is important because, this is
the camnings sources of all the banks.

10. Dennis Olson, Taisier A.Zoubi, (2014)

They examine that evidence gives suggestions that two accounts are jointly measured the Dennis
Chison, results support the earning management hypothesis. The authors also know that LLP and
all gives sign also about Future earnings of individuals.
 11. DR.P. Karthikeyan (2014)

He evaluated that mobilization of saving and allocation of saving to invest on products "Bank as
a economic institution which collects deposited money from the community, for those who it to
spare. And who are saving it to for the purpose of saving from their income and lends to those
who are required.

12. Kochan Carol (2013)

He stated that the GWLA libraries find that the best practices are adopted in 2002 improves
service by lowering turnaround time and increasing pattern access to another arrangement types.
Other library consortia are also used in parallel group best practices that increases resources
sharing.

13. Rajni and Dr. Navkiranjit Kaur Dhaliwal (2013)

Both of them examines that the current study makes an trying attempt to measure the loans. and
advances and recovery presentation of state co-operative agricultural and rural development
banks in Punjab by measuring through statistical tool.

14. Ron Weber (2012)

He stated that they are revealing that agricultural firms having higher difficulties to get credit but
as soon as possible they have access to credit. Their loans are differently capacity rationed than
those of non-agricultural firms.

15. Tina Baich, (2012)

He stated that during the period of the study borrowing begging for often access materials
enlarged while overall request held study. As the number of appeal adopted unlikely that
interlibrary loan needs will decrease for due to the mounting amount of open access material
available.

16. Benjamin Collier, Ani L. Katchova, Jerry R. Skees, (2011)

Both of them stated that the results shows El nino, slightly improved problem loans Specifically,
the level of streamlined loans. while restructured loans asual of 0.5% of the total loan portfolio
before the El Nino, The estimation snowballing effects of El Nino shows the additional 3.6% of
portfolio values was restructured due to that event.

17. Abdelkader Boudriga, Neila Boulila Taktak, Sana Jellouli, (2009)

They are stated that the observed results gives that huge capital capital adequacy (CAR) ratio
and judicious provisioning policy looks to reduce the equal of problem of loans and advances.
The paper also gives a desirable effect of private ownership.
 18. Liang Han, Francis Greene, (2007)

They stated that the paper finds that online loan behaviour is enormously measured by the
features of the entrepreneur. Rather than the of the venture its also finds that factors that
conviction. Evident in the value of the the association between the and their primary leaders, is
important factor. Moderating these effects is another evidence that advise the number of lenders
and distance from lenders and applicants has a marked effects on online loan behaviours.

19. VERSHA MOHINDRA AND GIAN KAUR (2011)

The present study attempts to empirically examine the relative efficiency of regional rural banks
during the most reform period spanning from 1991-92 to 2006-07 by using non-parametric
technique of data envelopment analysis.

20. G Sathish (2016)

He claims that the cooperative banking systems, which consists of two big systems: urban and
rural co-operative, is an important aspect of India's financial system. As financial intermediaries,
urban co-operative banks play an important role in assessing the credit needs of both the priority
sector and the sick segment of the population .
 CHAPTER -03

RESEARCH DESIGN

STATEMENT OF THE PROBLEM :

“A study on Loans and Advances with special reference to “KEMPEGOWDA PATTANA
SOUHARDA SAHAKARI BANK NIYAMITHA , TUMKUR’’ .

NEED FOR THE STUDY :

The financial management of public products is a grinding problem before the mobility of
internet resources. Even with the results and intense industries in the field deal with big money
crush and in inadequacy inside the mobility of internet resources. Even with the outcomes along
with suggestion of a great deal of committee appointed by the authorities to enquire in on the
working capital problems of public sphere devices.

OBJECTIVES OF THE STUDY :

1. To know the operations of the bank and its lending activity .
2. To understand the various types of Loans and Advances provided by the bank .
3. To Understand impact of Providing Loans and Recovery of various loans

SCOPE OF THE STUDY

1. The study limits to Kempegowda Pattana Souharda Sahakari Bank Niyamitha, Tumkur
2. The study covers the analysis of loans and advances under various heads.
3. For the analysis five years financial data has been considered and results are based on the
analysis of these data.

RESEARCH METHODOLOGY
The study uses descriptive research to try to prove that the reason for NPA creation and banker
performance. Based on the review of the literature was a found that there is the indifferent
performance of loan disbursement and recovery management but the result finds some negative
and positive inputs therefore the study is gain to ascertain whether it is impact positive or
negative concerning the related bank by consisting the study period of fiveyears.

COLLECTION OF DATA:

a. Primary Data: Primary data is collected through interaction with managers, and employees
of the bank.
b. Secondary Data: Secondary data sources are collected from Bank financial reports, Annual
reports, Journals, and Articles.
STATISTICAL TOOL USED

Karl Pearson’s co-efficient of correlation

Correlation: is a measurement that action that demonstrates the level to which at least 2 factors
move according to one another, a positive relationship determines the degree to which those
factors increment or lessening comparative a negative relationship shows the degree to which
one variable increment as the other reduction.

r xy =n ∑ xy −¿ ¿ ¿

HYPOTHESIS
A Theory is a proposed clarification for a wonder. For a speculation to be a logical theory, the
logical strategy necessitates that one can test it. Researchers by and large base logical
speculations on past perception that can't sufficiently be clarified with the accessible logical
hypotheses.

Types of hypotheses:
1. Research hypotheses.
2. Logical hypotheses (H0).
3. Statistical hypotheses.

Hypotheses:

Null Hypothesis (H0): There is no significance relationship between Personal Loan lending and
Personal Loan recovery of loans.

Alternative Hypothesis (H1): There is a significance relationship between Personal Loan

lending and Personal Loan recovery of loans.

LIMITATIONS OF THE STUDY

1. This study covers only aspects involving to the Loans and Advances of the bank.
2. The figures and facts declared in the financial statement and in additional forms are assumed
to be true.
3. The study is based on information pertains to only five years ending 31.03.2017 to
31.03.2021.
4. The study is limits due to the time constraints.
 CHAPTER -04
ANALYSIS AND DATA INTERPRETATION

Table Shows the Lending and Recovery of Property Loan from 2018 to2022

Table No .4.1

Year LoanLending Loan Recovery Recovery

(amount in Crores ) (amount in Crores) Percentage (%)

2017-2018 16,85,25,000.00 10,86,42,402.00 64.47%

2018-2019 12,34,00,000.00 10,29,34,961.2 83.42%

2019-2020 10,87,75,000.00 11,66,19,028.00 107.21%

2020-2021 6,02,50,000 .00 12,37,93,041.00 205.47%

2021-2022 7,87,20,000.00 10,59,02,798.00 134.53%

(Sources: Bank Records)

Analysis:

This table shows the details position of outstanding amount of Property Loan. We can interpret
that 64.47% of Property loan recovered in the financial year 2017-2018. In the year 2018-2019
loan recovery from the customer is 83.42%. In the year 2019-2020 loan recovery from the
customer is 107.21%. and the year 2020-2021& 2021-2022 the loan recovery from the customer
205.47% &134.53%
The Graph Shows That Lending and Recovery of Property loan from 2018 to
2022.

Graph No : 4.1

180000000
168525000
160000000

140000000
123400000 123793041
120000000 108775000 116619028
108642402 105902798
102934961
100000000
78720000
60250000
80000000

60000000

40000000

20000000

0
2017-18 2018-19 2019-20 2020-21 2021-22

Series 1 Series 2 Column1

Interpretation:

This graph shows the detailed information about Property Loan in Kempegowda pattana
Souharda Bank Limited. basically the recovery and Non recovery isbased on income of
customer , First 2 years recovery of loan is Lessbecause the customers have not paid the interest
regularly .And the loan recovery amount has increased in the next 3 years because the customers
have paid the interest regularly .
Table shows the lending and recovery of Fixed Deposit Loan from 2018 to
2022.

Table No. 4.2

Year Loan Lending Loan Recovery Recovery Percentage

(%)
(Amount in crores) (Amount in Crores)

2017-2018 1,28,37,152 1,13,61,849 88.51%

2018-2019 1,88,98,000 2,62,88,102 139.11%

2019-2020 17,97,900 84,01,632 97.31%

2020-2021 1,96,93,000 2,04,52,626 103.86%

2021-2022 1,66,92,567 73,38,000 43.96%

(Sources: Bank Records)

Analysis :

This table shows the details position of outstanding amount of Fixed deposit Loan. We can
interpret that 88.51% of Fixed deposit loan recovered in the financial year 2017-2018. In the
year 2018-2019 loan recovery from the customer is 139.11%. In the year 2019-2020 loan
recovery from the customer is 97.31%. and the year 2020-2021& 2021-2022 the loan recovery
from the customer 103.86%& 43.96% .
The Graph Shows That Lending and Recovery of Fixed Deposit loan from
2018 to 2022.

Graph No : 4.2
30,000,000

26,288,102
25,000,000
20,452,626
19,693,000
20,000,000 18,898,000
16,692,567
11,361,849
15,000,000
12,837,152

10,000,000
8,401,632
7,338,000

5,000,000
1,797,900

0
2017-18 2018-19 2019-20 2020-21 2021-22

Loan Lending (amount in crores) Loan Recovery (amount in Crores )

Interpretation:

This graph shows the detailed information about Fixed deposit Loan in Kempegowda pattana
Souharda Bank Limited.First year`s graph shows that the loan recovery is less because of the
less fixed deposit in that year , in next 4 years recovery of loan has increased because of fixed
deposits have increased which means they have provided more loan to the customer and
henceforth it is the reason for more recovery in all the year .
Table shows the lending and recovery of Vehicle Loan from 2018 to 2022.

Table No. 4.3

Year Loan Lending Loan Recovery Recovery Percentage

(%)
(Amount in crores) (Amount in Crores)

2017-2018 1,09,30,000 8,31,91,921 77%

2018-2019 63,50,000 87,80,382 138.27%

2019-2020 1,10,63,000 1,10,97,720 100.31%

2020-2021 69,30,500 99,65,645 143.79%

2021-2022 78,73,000 1,23,40,838 156.75%

(Sources: Bank Records)

Analysis :

This table shows the details position of outstanding amount of Vehicle Loan. We can interpret
that 77% of Vechile loan recovered in the financial year 2017-2018. In the year 2018-2019 loan
recovery from the customer is 138.27%. In the year 2019-2020 loan recovery from the customer
is 100.31%. and the year 2020-2021& 2021-2022 the loan recovery from the customer
143.79%&156.75 % .
The Graph Shows That Lending and Recovery of Vehicle loan from 2018 to
2022.

Graph No : 4.3

90,000,000
83,191,921
80,000,000

70,000,000

60,000,000

50,000,000

40,000,000

30,000,000

20,000,000
11,097,720 12,340,838
10,930,000 11,063,000 9,965,645
10,000,000 8,780,382 7,873,000
6,350,000 6,930,500

0
2017-18 2018-19 2019-20 2020-21 2021-22

Loan Lending (amount in crores) Loan Recovery (amount in Crores)

Interpretation:

This graph shows the detailed information about Vehicle Loan in Kempegowda pattana
Souharda Bank Limited. As it is a long term loan it requires 2.5 or 5 years to recover the interest
as well as the principal amount , First 3years graph shows increased trend because the customer
has to pay the interest regularly , and4th year has also increased, And the loan recovery amount is
increased in final year bank and has to maintain constant position in loan in upcoming year .
Table shows the lending and recovery of Housing Loan from 2018 to 2022.
Table No. 4.4

Year Loan Lending Loan Recovery Recovery Percentage

(Amount in crores) (Amount in Crores) (%)

2017-18 265,50,000 1,92,80,628 72.62%

2018-19 3,10,00,000 2,07,10,567 68.81%

2019-20 2,12,00,000 2,23,67,262 105.51%

2020-21 1,82,88,158 63,50,000 34.72%

2021-22 2,03,00,000 1,53,68,360 75.71%

(Sources: Bank Records)

Analysis :

This table shows the details position of outstanding amount of Housing Loan. We can interpret
that 72.62% of Housing loan recovered in the financial year 2017-2018. In the year 2018-2019
loan recovery from the customer is 68.81%. In the year 2019-2020 loan recovery from the
customer is 105.51%. and the year 2020-2021& 2021-2022 the loan recovery from the customer
34.72%&75.71 % respectively.
The Graph Shows That Lending and Recovery of Housing loan from 2018 to
2022.
Graph No : 4.4

Chart Title
35,000,000

30,100,000
30,000,000
26,550,000
25,000,000 21,200,000 22,367,262
20,710,567 18,288,158 20,300,000
20,000,000 19,280,628
18,288,158
15,368,360
15,000,000

10,000,000

5,000,000

0
2017-18 2018-19 2019-20 2020-21 2021-22

Loan Lending (amount in crores) Loan Recovery (amount in Crores )

Interpretation:

This graph shows the detailed information about housing loan in Kempegowda pattanaSouharda
Bank Limited. As it is a long term loan it requires 10years to recover the interest as well as the
principal amount , First 2 years graph will show decrease in loan recovery because customer
does not pay the interest regularly ,3rd yearrecovery has increased because the recovery is good
in that year , 4th year there shows constant trend because of pandemic their was no recovery, in
the 5th year recovery is decrease of this pandemic situation there is a decrease in the recovery .
Table shows the lending and recovery of Joint Loan from 2018 to 2022.
Table No. 4.5

Year Loan Lending Loan Recovery Recovery percentage

(amount in Lakhs) (amount in Lakhs) (%)

2017-18 27,70,000 30,97,458 111.82%

2018-19 26,10,000 27,80,398 106.53%

2019-20 25,30,000 26,22,884 103.67%

2020-21 17,10,000 21,64,830 126.50%

2021-22 17,10,000 16,36,676 95.71%

(Sources: Bank Records)

Analysis :

This table shows the details position of outstanding amount of Joint Loan. We can interpret that
111.82% of Joint loan recovered in the financial year 2017-2018. In the year 2018-2019 loan
recovery from the customer is 106.53%. In the year 2019-2020 loan recovery from the customer
is 103.67%. and the year 2020-2021& 2021-2022 the loan recovery from the customer
126.50%& 95.71% .
The Gaph Shows That Lending and Recovery of Joint loan from 2018 to 2022.
Graph No :4.5

Chart Title
3,500,000
3,097,458
3,000,0002,770,000 2,780,398
2,610,000 2,530,000 2,622,884
2,500,000
2,164,830
2,000,000 1,710,000 1,710,000 1,636,676

1,500,000

1,000,000

500,000

0
2017-18 2018-19 2019-20 2020-21 2021-22

Loan Lending (amount in Lakhs) Loan recovery (amount in Lakhs)

Interpretation:

This graph shows the detailed information about Joint Loan in Kempegowda pattanaSouharda
Bank Limited. As it is a short term loan it requires 6 months to recover the interest ,The first 4
years the graph show the increase because they have paid the interest immediately , 5 th year
recovery has decreased because of the pandemic situation the customers have not paid the
interest .
Table shows the lending and recovery of Over draftLoan from 2018 to 2022.
Table No. 4.6

Year Loan Lending Loan Recovery Recovery Percentage

(amount in Crores) (amount in Crores) (%)

2017-18 5,63,45,423 5,53,72,382 98.27%

2018-19 5,46,27,022 6,30,08,028 115.34%

2019-20 4,78,11,506 3,60,42,634 75.38%

2020-21 3,55,00,187 3,44,69,370 97.09%

2021-22 2,65,54,797 2,91,18,683 109.65%

(Sources: Bank Records)

Analysis :

This table shows the details position of outstanding amount of Over draft Loan. We can interpret
that 98.27% of Over draft loan recovered in the financial year 2017-2018. In the year 2018-2019
loan recovery from the customer is 115.34%. In the year 2019-2020 loan recovery from the
customer is 75.38%. and the year 2020-2021& 2021-2022 the loan recovery from the customer
97.09%& 109.65% .
The Graph Shows That Lending and Recovery of Over draft loan from 2018
to 2022.
Graph No :4.7

Chart Title
70,000,000
56,345,423 63,008,028
60,000,000
55,372,382 54,627,022

50,000,000 47,811,506

36,042,634
40,000,000
35,500,187 34,469,370 29,118,683

30,000,000 26,554,797

20,000,000

10,000,000

0
2017-18 2018-19 2019-20 2020-21 2021-22

Loan Lending (amount in Crores) Loan Recovery (amount in crores)

Interpretation:

This graph shows the detailed information about Over draft Loan in Kempegowda pattana
Souharda Bank Limited. As it is a short term loan it requires 1 year to recover the interest ,The
first years the graph show the decrease in recovery because they have take the loan , 5 th year
recovery is decrease because of the pandemic situation the customers have not paid the interest .
Table shows the lending and recovery of Personal Loan from 2018 to 2022.
Table No. 4.7

Year Loan Lending Loan Recovery Recovery

percentage
(amount in Lakhs) (amount in Lakhs )
(%)
2017-18 1,50,000 1,85,520 123.68%

2018-19 50,000 1,24,889 249.78%

2019-20 3,00,000 2,10,146 70.05%

2020-21 1,00,000 1,92,914 192.91%

2021-22 - 1,14,521 -

(Sources: Bank Records)

Analysis :

This table shows the details position of outstanding amount of Personal Loan. We can interpret
that 123.68% of Personal loan recovered in the financial year 2017-2018. In the year 2018-2019
loan recovery from the customer is 249.78%. In the year 2019-2020 loan recovery from the
customer is 70.05%. and the year 2020-2021& 2021-2022 the loan recovery from the customer
192.91%& 0% .
The Graph Shows That Lending and Recovery of Personal loan from 2018 to
2022.
Graph No :4.8

Chart Title
350,000
300,000
300,000

250,000
210,146
200,000 185,520 192,914

150,000
150,000
124,889
114,521
100,000
100,000
50,000
50,000
0
0
2017-18 2018-19 2019-20 2020-21 2021-22

Loan Lending (amount in Lakhs) Loan Recovery(amount in lakhs)

Interpretation :

This graph shows the detailed information about Personal Loan in Kempegowda pattana
Souharda Bank Limited. The personal loan is given only for bank employee ,The first 2 years
the graph show the increase because they have paid the interest immediately , next 2 year
recovery I shows decrease in recovery because the bank employee had not paid the interest
regularly ,the 5th year the bank does not pay any loan to employee because of pandemic and last
year interest they have collected in that year .
Table shows the lending and recovery of Staff Loan from 2018 to 2022.
Table No. 4.9

Year Loan Lending Loan Recovery Recovery Percentage

(amount in Lakhs) (amount in Lakhs ) (%)

2017-18 19,50,000 14,33,869 73.53%

2018-19 10,00,000 12,33,272 123.33%

2019-20 45,00,000 4,81,365 10.68%

2020-21 44,05,000 26,82,710 60.90%

2021-22 26,00,000 39,66,911 152.57%

(Sources: Bank Records)

Analysis :

This table shows the details position of outstanding amount of Staff Loan. We can interpret that
73.53% of Staff loan recovered in the financial year 2017-2018. In the year 2018-2019 loan
recovery from the customer is 123.33%. In the year 2019-2020 loan recovery from the customer
is 10.68%. and the year 2020-2021& 2021-2022 the loan recovery from the customer 60.90%&
152.57% .
The Graph Shows That Lending and Recovery of Staff loan from 2018 to
2022.
Graph No :4.9

Chart Title
5,000,000
4,500,000 4,405,000
4,500,000

4,000,000

3,500,000

3,000,000 2,682,710 2,600,000

2,500,000
1,950,000
2,000,000
1,433,869 1,233,272
1,500,000
1,000,000
1,000,000
481,365
500,000

0
2017-18 2018-19 2019-20 2020-21 2021-22

Loan Lending (amount in Lakhs) Loan Recovery (amount in Lakhs )

Interpretation :

This graph shows the detailed information about Staff Loan in Kempegowda pattanaSouharda
Bank Limited. The Staff loan is given only for bank employee ,The first years the graph show
there is decrease in recovery because they had not paid the interest immediately , next year
recovery hasincreased because the bank employee havepaid the interest regularly ,the 3rd and 4th
year the bank recovery has decreased because the staff members have not paid the interest
regularly ,In 5th year there was be no recovery because of pandemic.
HYPOTHESIS TESTING :

Lending(X) and Recovery(Y) of Personal Loan

Year x y xy x2 y2

2017-18 1,50,000.00 1,85,520.00 27,82,80,00,000 22,50,00,00,000 34,41,76,70,400

2018-19 50,000.00 1,24,889.00 6,24,44,50,000 25,00,000,000 15,59,72,62,321

2019-20 3,00,000.00 2,10,146.00 63,04,38,00,000 90,00,00,00,000 44,16,13,41,316

2020-21 1,00,000.00 1,92,914.00 19,29,14,00,000 10,00,00,00,000 37,21,58,11,396

2021-22 0 1,14,521.00 0 0 13,11,50,59,441

Total 6,00,000.00 8,27,990.00 1,16,40,76,50,000 1,25,00,00,00,000 1,44,50,71,44,874

Correlation Coefficient = r = 0.861246578

71

n=5

r xy =n ∑ xy −¿ ¿ ¿

5 ( 11640 7650000.00 )−( 600000.00)(827990.00)

rxy =
√625000000000−( 600000 ) ∗√722535724370−(827990)
2 2

582038250000−496794000000
rxy=
√625000000000−360000000000∗√722535724370−685567440100

85244250000
rxy=
√265000000000∗√ 36968284270
 85244250000
rxy= 514781.5070∗192271.3818

85244250000
rxy= 98977751675.9

rxy= 0.86124657871

Interpretation:
The correlation Coefficient is 0.86125 this Indicates of strong relationship between Personal
Loan Lending(X) and Personal Loan Recovery(Y) of loans and advances hence Null hypothesis
is rejected and alternative hypothesis is accepted.
 CHAPTER-5

FINDINGS, SUGGESTIONSANDCONCLUSION
FINDINGS:

 The recovery percentage of Vehicle Loan is increased in 2020-2021 that is 143.79%

compared to the previous years. And the year 2021-2022 it slightly increased to 156.75%.
 In case of Fixed Deposit loan Fluctuation year by year. In the year 2020-2021 it was
103.86% and in the year 2021-2022 it was decreased to 43.96%.
 In case of Housing loan, it is slightly increased by year to year. In the year 2020-2021 it was
increased to 288.00% and in the year 2021-2022 it was slightly decreased to 75.71%.
 The bank recovery of Personal Loan is fluctuating every year and in the year 2020-2021 it
was increased by 192.91%. And in the year 2021-2022 it was slightly decreased to 0%.
 The Property Loan is better recovery from the customers. In the year 2020-2021 it is
recovered 205.47% and next year in 2021-2022 it was slightly increased loan recovery is
210.75%.
 There is an decreased every year Joint loan recovery percentage , And in the year 2020-2021
it was increased 126.50%. And in the year 2021-2022 recovery percentages is slightly
decreased to 95.71%.
 The over draft loan was bank recovered from the customers is 97.09% in the year 2020-2021.
And in 2021-2022 the loan recovery was increased 109.65%.
 In case of Staff loan is fluctuate year by year. And in the year 2020-2021 the loan amount is
recovered 60.90%. And next year in 2021-2022 recovery percentage is 152.57%.
SUGGESTIONS:
The Kempegowda pattana Souharda Sahakari Bank Limited is performing their function
professionally through I wish to give the some following suggestion.

 The bank can maintain same level of lending and recovery practice of Personal loan.
 The bank should maintain same level of condition and policies towards the Vehicle loan.
 The bank should make changes in the period of repayment, by extending the repayment
period so that the loan can be easily recovered in the case of Housing loan.
 The bank should maintain the constant level to get proper recovery of gold Loan.
 The bank should maintain good level of interest so it useful to attract more number of
customers.
 The bank will take some measures for improve the loans and advances. It helps to increases
the value of bank.
 The bank has to introduce more and more schemes for all section people particularly for low
income groups.
 The bank should maintain the constant level to get proper recovery of cash credit loan.
 The bank must maintain the same situation for the deposit loan.
 The bank must maintain the same policy in the case of Staff loan.
 The bank should take some measures for increasing the advances, so the asset value of bank
will be increase.
CONCLUSION:
The study is made on Five years. I have observed that the Kempegowda pattana Souharda
Sahakari Bank Limited has providing good financial services to customers in over all Tumkur
district. The major activity of the bank is to provide the loan for customers, farmers and not only
for backward class peoples also for officials for the development. The bank barrows money from
depositors and lend that money to the other customers with reasonable interest rates . They have
taken many schemes and steps for the development and help to the customers.

Kempegowda Pattana Souharda Sahakari bank Limited is one of the well-known co-operative
sector bank in Tumkur district. The bank is performing its function very well.

Loan and Advances provided by Kempegowda Pattana Souharda Sahakari Bank Niyamita,
Tumkur is helping the customers .
 ANNEXURES

TOTAL LENDING

TYPES OF 2017-2018 2018-2019 2019-2020 2020-2021 2021-2022

LOAN

Property Loan 168525000.00 123400000.00 108775000 60250000 78720000

Fixed Deposit 12837152.00 18898000.00 1797900.00 19693000.00 7338000.00

Loan

Vehicle Loan 10930000.00 6350000.00 11063000.00 6930500.00 7873000.00

Housing Loan 26550000.00 30100000.00 21200000.00 6350000.00 20300000.00

Personal Loan 150000.00 50000.00 300000.00 100000.00 -

Joint Loan 2770000.00 2610000.00 2530000.00 1710000.00 1710000.00

Overdraft 56345423.00 54627022.90 47811506.90 35500187.60 26554797.80

Loan

Staff Loan 1950000.00 1000000.00 4500000.00 4405000.00 2600000.00

TOTAL RECOVERY

TYPES 2017-2018 2018-2019 2019-2020 2020-2021 2021-2022

OF
LOAN

Property 108642402.00 102934961.2 116619028.00 123793041.00 105902798.00

Loan 0

Fixed 11361849.00 26288102.00 8401632.00 20452626.00 16692567.00

Deposit
Loan

Vehicle 83191921.00 8780382.00 11097720.00 9965645.00 12340838.00

Loan

Housing 19280628.00 20710567.00 22367262.00 18288158.00 15368360.00

Loan

Personal 185520.00 124889.00 210146.00 192914.00 114521.00

Loan

Joint 3097458.00 2780398.00 2622884.00 2164830.00 1636676.00

Loan

Overdraft 55372382.00 63008028.00 36042634.00 34469370.20 29118683.00

loan

Staff 1433869.00 1233272.00 481365.00 2682710.00 3966911.00

Loan
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JOURNALS :

 Sathyajitdar, Avijit Bakshi, . (2015). A Study on Loans and Advances. Journals of Asia

Business Studies . 9 (1), 17-32.
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control . 18 (3), 252-265.
 Dennis Olson, Taisier A.Zoubi. (2014). A Study on Loans and Advances. Journal of
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 G. Sathish June, (2018). A Study on Loans and Advances. Journal of Asia Business

Studies . 9 (4), 56-80.
 Esther LaryeMatthew Ntow-Gyamfi, Angela AzumahAlu. (2016). A Study on Loans and
Advances. African journals of economic and management studieds. 7 (4), 462-481.
 B. Katti Guest Lecturer, Dr. Rathod Motilal. (2016). A Study on Loans and
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 DR .P. Karthikeyan . (2014). A Study on Loans and Advances. Journals of Economic

Perspective . 16 (3), 67-68.
  Rajni and Dr. Navkiranjit Kaur Dhaliwal . (2012). A Study on Loans and
Advances. Journal of Indian co operative review . 36 (2), 178-189.
 Ron Weber . (2012). A Study on Loans and Advances. Journal of Agricultural finance
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 Tina Baich. (2012). A Study on Loans and Advances. journals of Interlending and
document supply . 40 (1), 55-60.

 Benjamin Collier, Ani L. Katchova, Jerry R. Skees. (2011). A Study on Loans and
Advances. Journal an intervention analysis . 71 (1), 98-119.
 Abdelkader Boudriga, Neila Boulila Taktak, Sana Jellouli. (2009). A Study on Loans and
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 Liang Han, Francis Greene. (2007). A Study on Loans and Advances. Journal of small
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BOOKS :

 venkataraman R and other (2014). Accounting for managers . Mumbai: vision book

house. 315-412.
 SBLC ,Panchkula (2011). Staff Loans abd Advances . Mumbai: Industrial
Department,CC. 87-88.
 Bhattacharya S.K and John dear son (1970-1980). Account for management . Vikas
Publishing house : Vision book house . 125.
 Old report maintained by Kempegowda Pattana Souharda Sahakari bank Tumkur, Ashok
Nagar .
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