issues in bank branch audit

8/6/2019 Issues in Bank Branch Audit

1/26

ISSUESISSUES ININ BANKBANK BRANCHBRANCH AUDITAUDIT


2/26

AUDITAUDIT OFOF BANKBANK BRANCHESBRANCHES

BankBank utilizeutilize thethe serviceservice of of

charteredchartered accountantsaccountants forfor differentdifferenttypestypes of of auditsaudits inin anan extensiveextensivemannermanner ii..ee.. forfor NonNon StatutoryStatutory

Audit/InspectionAudit/Inspection StatutoryStatutory AuditAudit


3/26

TYPESTYPES OFOF AUDITAUDITNonNon StatutoryStatutory auditsaudits

Concurrent AuditConcurrent Audit Internal AuditInternal Audit Revenue AuditRevenue Audit Stock Audit Stock Audit System Audit System Audit

Special/Snap AuditSpecial/Snap AuditStatutoryStatutory AuditAudit

The audit in accordance with the provision of statuteThe audit in accordance with the provision of statutegoverning itgoverning it--u/s. 30 of The Banking Regulation Act, 1949.u/s. 30 of The Banking Regulation Act, 1949.

--u/s. 10 of The Banking Companies Act, 1970/1980.u/s. 10 of The Banking Companies Act, 1970/1980.--u/s. 41 of The State Bank of India(Subsidiaries Bank)u/s. 41 of The State Bank of India(Subsidiaries Bank)Act, 1959Act, 1959--u/s. 19 of The Regional Rural Bank Act, 1976.u/s. 19 of The Regional Rural Bank Act, 1976.--u/s. 224 of The Companies Act, 1956.u/s. 224 of The Companies Act, 1956.

--Provides for the audit of the accounts of the bank.Provides for the audit of the accounts of the bank.


4/26

AppointmentAppointment && RoleRole ofof AuditorAuditor

BanksBanks appointsappoints CharteredChartered AccountantsAccountants toto carrycarryoutout thethe auditaudit andand certificationcertification ofof theirtheir booksbooks

andand returns,returns, outout ofof panelpanel compiledcompiled byby ICAIICAI andandRoleRole ofof thethe auditorauditor isis toto carrycarry outout auditaudit andandsubmitsubmit thethe reportreport toto thethe centralcentral auditorauditor..

What to do on appointment?What to do on appointment?

-- Letter of Engagement (AASLetter of Engagement (AAS 26)26)

-- Communication with the previous charteredCommunication with the previous chartered

accountantaccountant


5/26

AUDIT PLANNING & PROGRAMINGAUDIT PLANNING & PROGRAMING

BeforeBefore wewe planplan thethe audit,audit, wewe mustmust havehave anan ideaidea ofofthethe followingfollowing matters/criteriamatters/criteria ofof thethe BankBank BranchBranch

BusinessBusiness mixmix ofof thethe BankBank BranchBranch TypesTypes ofof thethe AdvancesAdvances andand NatureNature ofof AdvancesAdvances BiggerBigger AdvanceAdvance NoNo.. ofof AccountsAccounts NPANPA andand AmountAmount ofof NPANPA

SoftwareSoftware deployeddeployed atat thethe BranchBranch

Cont..Cont..


6/26

ContContOnOn thethe basisbasis ofof above,above, anan audit audit teamteam isis toto bebe

determineddetermined toto carrycarry outout thethe auditaudit..

Before we start an audit, it is necessary to goBefore we start an audit, it is necessary to gothrough the following reports/Returnsthrough the following reports/Returns

Study of Closing Instruction CircularStudy of Closing Instruction Circular Various Audit Reports/Inspection Reports includingVarious Audit Reports/Inspection Reports including

last year statutory audit reports and effect of MOC iflast year statutory audit reports and effect of MOC ifanyany

Study of Important Circulars / guidelinesStudy of Important Circulars / guidelines

Study of Annual Closing Returns including Form AStudy of Annual Closing Returns including Form Aand Form Band Form B On the basis of above, issue a letter of requirementOn the basis of above, issue a letter of requirement

to the Branch in charge/Manager that needs toto the Branch in charge/Manager that needs tocomplete the audit assignmentcomplete the audit assignment


7/26

AUDIT & ASSURANCE STANDARDAUDIT & ASSURANCE STANDARDAuditorAuditor hashas toto considerconsider thethe applicabilityapplicability ofof thethe AuditAuditandand AssuranceAssurance StandardsStandards whilewhile auditaudit ofof thethe bankbankbranchbranch..

AllAll thethe standardsstandards areare applicableapplicable toto bankbank branchbranch auditauditexceptexcept belowbelow::AASAAS 1010 Using the work of another auditorUsing the work of another auditorAASAAS 1212 Responsibility of joint auditorResponsibility of joint auditorAASAAS 3131 Engagement to compile financialEngagement to compile financial

informationinformationAASAAS 3232 Engagement to perform agreed uponEngagement to perform agreed upon

procedures regarding Financial Informationprocedures regarding Financial InformationAASAAS 3333 Engagement to Review FinancialEngagement to Review Financial

StatementsStatements


8/26

ACCOUNTING STANDARDS & DISCLOSURESACCOUNTING STANDARDS & DISCLOSURES

ReserveReserve BankBank ofof IndiaIndia hashas issuedissued MasterMaster CircularCircular NoNo.. RBI/RBI/20052005--0606//3232 dateddated 0101..0707..20062006 regardingregarding thethe disclosuredisclosure requiredrequired totobebe mademade inin thethe BalanceBalance sheetsheet.. TheThe CircularCircular depictsdepicts asas belowbelow::

Disclosures as per accounting standardsDisclosures as per accounting standards

--Wh

ere RBIh

as issued guidelinesWh

ere RBIh

as issued guidelinesAccounting Standards ,9,15,17,18,21,22,23,24 & 25Accounting Standards ,9,15,17,18,21,22,23,24 & 25-- Other Accounting StandardsOther Accounting Standards

Banks are require to comply with the disclosure norms stipulatedBanks are require to comply with the disclosure norms stipulatedunder the various accounting standards issued by ICAIunder the various accounting standards issued by ICAI

Enhanced DisclosuresEnhanced DisclosuresThereThere areare certaincertain otherother disclosuresdisclosures areare requiredrequired toto bebe mademade asasspecifiedspecified byby thethe RBIRBI andand thethe samesame isis calledcalled asas enhancedenhanced disclosures,disclosures,thethe samesame havehave beenbeen achievedachieved throughthrough revisionrevision ofof BalanceBalance sheetsheet andandProfitProfit && LossLoss AccountAccount ofof banksbanks andand enlargingenlarging thethe scopescope ofof disclosuresdisclosurestoto bebe mademade inin NotesNotes onon AccountAccount


9/26

ANALYSIS & VERIFICATION OF ACCOUNTSANALYSIS & VERIFICATION OF ACCOUNTS

Following are the key/Check points to analyze the accounts.Following are the key/Check points to analyze the accounts.

Physical VerificationPhysical Verification-- Cash, Adhesive Stamps, Postage and tally with GLCash, Adhesive Stamps, Postage and tally with GL-- Physical verification of valuable stationery and fixed assets.Physical verification of valuable stationery and fixed assets.

Verification of BalancesVerification of Balances-- Opening Balance with last year audited accountsOpening Balance with last year audited accounts-- Closing Balance of GL with subsidiary recordsClosing Balance of GL with subsidiary records-- VerificationVerification ofof thethe ReturnsReturns andand certificatescertificates withwith BalanceBalance sheetsheet

andand ProfitProfit && LossLoss AccountAccount andand otherother recordsrecords availableavailable atat thethe

BankBank BranchBranch-- Verification of the Exceptional Transaction ReportVerification of the Exceptional Transaction Report

Cont..Cont..


10/26

ContCont

DepositsDeposits Obtain the weekly statements, Review the movement in theObtain the weekly statements, Review the movement in the

deposits and if any, divergent trend, obtain the clarification fordeposits and if any, divergent trend, obtain the clarification forthe same.the same.

Review the difference of deposits as on 31.03.2007 and dateReview the difference of deposits as on 31.03.2007 and dateof audit.of audit.

Review the Target with achievement.Review the Target with achievement. Review the Overdue/Matured Term Deposits shown in demandReview the Overdue/Matured Term Deposits shown in demand

deposits, whether interest provision have been made or not.deposits, whether interest provision have been made or not.

Check the date when interest applied on the deposits.Check the date when interest applied on the deposits. Verification of Staff AccountsVerification of Staff Accounts

Whether the segregation of InWhether the segregation of In--operative accounts have beenoperative accounts have beenmade or not? Review the Operations in Inmade or not? Review the Operations in In--operative accountsoperative accounts

Review overdraft in Deposit accountsReview overdraft in Deposit accounts Verify premature withdrawals of Term Deposits.Verify premature withdrawals of Term Deposits.

ContCont


11/26

ContContAdvancesAdvances

From the Weekly Statements, verify the movements in theFrom the Weekly Statements, verify the movements in theAdvances.Advances.

Verify the difference of advances as on 31.03.2007 and date ofVerify the difference of advances as on 31.03.2007 and date ofaudit.audit.

Verify the Target with AchievementVerify the Target with Achievement Verify the Loan Application Register and Sanctioned RegisterVerify the Loan Application Register and Sanctioned Register Review the powers of the Branch ManagerReview the powers of the Branch Manager

Verify the documents of Advances Fund based and Non FundVerify the documents of Advances Fund based and Non Fundbased disbursed adopting LIFO methodbased disbursed adopting LIFO method

Review the security available against the advances disbursedReview the security available against the advances disbursed Scrutinize the Ledger of Advances including BP/BD limits andScrutinize the Ledger of Advances including BP/BD limits and

Review the disbursement made.Review the disbursement made. Obtain the List of Potential NPA AccountsObtain the List of Potential NPA Accounts Verify the NPA Register and Movement in NPA AccountsVerify the NPA Register and Movement in NPA Accounts Verify the suit filed and decreed accounts & their follow upVerify the suit filed and decreed accounts & their follow up Verify the invoked NonVerify the invoked Non--Fund based Advances, BG, LCFund based Advances, BG, LC Verify the statement of the Overdue accountsVerify the statement of the Overdue accounts

Cont..Cont..


12/26

ContCont

OthersOthers Analysis of entries outstanding in the Suspense Accounts, SundryAnalysis of entries outstanding in the Suspense Accounts, Sundry

Debtors, Sundry CreditorsDebtors, Sundry Creditors Checking of Addition/deduction to the fixed assets.Checking of Addition/deduction to the fixed assets. Review Locker Register and Locker Rent and provision of the same.Review Locker Register and Locker Rent and provision of the same. Review the Inter branch reconciliation, whether any repetitiveReview the Inter branch reconciliation, whether any repetitive

entries? Need reporting?entries? Need reporting?

Verify all the balances are shown under proper headsVerify all the balances are shown under proper heads Verify credit balance of Advance and Debit Balance in Deposits areVerify credit balance of Advance and Debit Balance in Deposits are

not netted off and shown properlynot netted off and shown properly Verify the Interest accrued but not due in case of deposits andVerify the Interest accrued but not due in case of deposits and

advances are not included in respective heads but shown separatelyadvances are not included in respective heads but shown separately Verify the Inward/Outward collection and outstanding entries if anyVerify the Inward/Outward collection and outstanding entries if any

Compare all the figures with previous years figuresCompare all the figures with previous years figures Verify the TDS deducted paid in time/Form 15G, 15H obtained andVerify the TDS deducted paid in time/Form 15G, 15H obtained andsubmitted to the I.T. department in time.submitted to the I.T. department in time.

Verify that Service Tax payment have been made by the branch inVerify that Service Tax payment have been made by the branch intime.time.

Verify the lease Deed and AMC in force.Verify the lease Deed and AMC in force.

Review other internal controls and checksReview other internal controls and checks


13/26

VERIFICATION OF THE ADVANCESVERIFICATION OF THE ADVANCES While verification of the advances, we must have knowledge of the followingWhile verification of the advances, we must have knowledge of the following

aspects:aspects:

Provision of The Banking Regulation Act override the one in any other law.Provision of The Banking Regulation Act override the one in any other law. Restriction on certain advances by the RBI and/or HO of the Bank.Restriction on certain advances by the RBI and/or HO of the Bank. RBI has issued aRBI has issued a Master Circular No. RBI/2006Master Circular No. RBI/2006--07/17 dated 01.07.200607/17 dated 01.07.2006

viz. Loans & Advancesviz. Loans & Advances Statutory & Other restrictionsStatutory & Other restrictions. Some important. Some importantaspects of the circulars are:aspects of the circulars are:

Bank can not finance against its own sharesBank can not finance against its own shares Generally Bank can not finance directly or indirectly to the directorsGenerally Bank can not finance directly or indirectly to the directors

of its own bankof its own bank No advance shall be granted to the relatives of the directorsNo advance shall be granted to the relatives of the directors

without prior approval of the Board of the Bank.without prior approval of the Board of the Bank. Restriction to grant of financial assistance to industries producingRestriction to grant of financial assistance to industries producing

/consuming Ozone Depleting Substance/consuming Ozone Depleting Substance No loan granted against partly paid sharesNo loan granted against partly paid shares No loans to be granted to proprietorship/partnership concernNo loans to be granted to proprietorship/partnership concern

against the primary security of shares/debenturesagainst the primary security of shares/debentures No loans granted against the FDR of the Other BanksNo loans granted against the FDR of the Other Banks Bank can not grant advance against certificate of depositBank can not grant advance against certificate of deposit Bank can not grant finance to construct building meant purely forBank can not grant finance to construct building meant purely for

govt. or semi govt.govt. or semi govt. Bank should not advance against bullion/Primary Gold/SilverBank should not advance against bullion/Primary Gold/Silver There are other restrictions to the advances mentioned in theThere are other restrictions to the advances mentioned in the

above sited circulars.above sited circulars.


14/26

Verification of Documents for AdvancesVerification of Documents for Advances

Verification of the documents bifurcated in three parts:Verification of the documents bifurcated in three parts:

A.A. CREDIT APPRAISALCREDIT APPRAISALCreditCredit appraisalappraisal isis thethe verificationverification ofof thethe prepre sanctionedsanctioneddocumentsdocuments ofof thethe advancesadvances disburseddisbursed.. FollowingFollowing areare thethelistlist ofof somesome ofof documentsdocuments whichwhich requiredrequired reviewreview whilewhileverificationverification ofof thethe advancesadvances::

-- Contribution of the promoter (Project Report)Contribution of the promoter (Project Report)

-- Justification of the Projections, existing or newJustification of the Projections, existing or new

ventureventure

-- Branch Visit Report (PreBranch Visit Report (Pre--Sanction Visit Report)Sanction Visit Report)-- CR of other Banks and No DuesCR of other Banks and No Dues

-- Powers to borrow of the borrower.Powers to borrow of the borrower.

-- Valuation Reports of the Property/Properties.Valuation Reports of the Property/Properties.

-- Title Clear Reports of the mortgaged propertyTitle Clear Reports of the mortgaged property


15/26

ContCont

B.B. BRANCH DOCUMENTATIONBRANCH DOCUMENTATION

BeforeBefore wewe startstart aa verificationverification ofof thethe documents,documents,wewe havehave followingfollowing aspectsaspects inin ourour knowledgeknowledge..TYPES OF ADVANCESTYPES OF ADVANCESThereThere areare followingfollowing typestypes ofof advancesadvances givengiven byby

thethe bankbank againstagainst thethe differentdifferent securitiessecurities..Fund Based AdvancesFund Based Advances Overdraft against securitiesOverdraft against securities Working Capital Finance/Packing CreditWorking Capital Finance/Packing Credit

Term Loan/WCTLTerm Loan/WCTL Bills Purchase/Bill Discount/FactoringBills Purchase/Bill Discount/Factoring

Non Fund Based AdvancesNon Fund Based Advances Bank GuaranteeBank Guarantee

-- Letter of CreditLetter of Credit


16/26

ContCont

TYP

ES OF SECURITIESTYP

ES OF SECURITIESThere are different types of securities against which theThere are different types of securities against which theabove said advances are generally granted by the banksabove said advances are generally granted by the banks Prime SecurityPrime Security

Collateral SecurityCollateral Security

PrimePrime SecuritySecurity isis thethe securitysecurity underunder thethe chargecharge ofof thethebankbank forfor whichwhich bankbank hashas givengiven thethe financefinance totocreate/build/construct/purchasecreate/build/construct/purchase thethe samesame..

CollateralCollateral securitysecurity isis thethe additionaladditional securitysecurity underunder thethechargecharge ofof thethe bankbank onon whichwhich chargecharge isis createdcreated toto covercoverthethe riskrisk // minimizeminimize thethe riskrisk /reduce/reduce thethe riskrisk ofof advanceadvancewherewhere thethe bankbank isis havinghaving nono actualactual possessionpossessionof/mortgageof/mortgage overover thethe primeprime securitysecurity..


17/26

ContCont

TYPES OF SECURITIESTYPES OF SECURITIES Security may be of the following:Security may be of the following: Land/Real EstateLand/Real Estate Stocks/SharesStocks/Shares DebenturesDebentures GoodsGoods Life PoliciesLife Policies

Book DebtBook Debt Fixed DepositsFixed Deposits Supply BillsSupply Bills Guarantee etc.Guarantee etc.


18/26

ContCont

MODE OF CHARGING

MODE OF CHARGING1.1. MortgageMortgageA. Simple Mortgage [sec 58(b) of the Transfer ofA. Simple Mortgage [sec 58(b) of the Transfer ofProperty Act]Property Act]

SimpleSimple mortgagemortgage isis thethe mortgagemortgage ofof thethe immovableimmovable

propertyproperty withoutwithout deliveringdelivering possessionpossession ofof thethe property,property,salesale of of suchsuch mortgagemortgage requiresrequires priorprior approvalapproval ofof thethecourtcourt..

B. Mortgage by way of Conditional Sale [SecB. Mortgage by way of Conditional Sale [Sec58(c)]58(c)]

ThisThis mortgagemortgage isis nothingnothing butbut conditionalconditional salesale of of thetheimmovableimmovable propertyproperty withwith certaincertain termsterms andand condition,condition,salesale becomebecome voidvoid if if certaincertain conditioncondition notnot fulfilledfulfilled asasmentionedmentioned inin thethe deeddeed ofof mortgagemortgage..


19/26

Cont..Cont..C. Usufructuary Mortgage [sec 58(d)]C. Usufructuary Mortgage [sec 58(d)]InIn thisthis typetype of of mortgagemortgage actualactual possessionpossession ofof thetheimmovableimmovable propertyproperty isis transferredtransferred toto thethe financerfinancer.. TheThepossessionpossession ofof thethe propertyproperty releasedreleased afterafter allall thethe duesdues ofoffinancerfinancer getget clearedcleared..

D. Equitable Mortgage [Sec 58(f)]D. Equitable Mortgage [Sec 58(f)]

EquitableEquitable mortgagemortgage isis nothingnothing butbut thethe DepositsDeposits ofof thetheTitleTitle DeedsDeeds withwith thethe financer,financer, suchsuch mortgagemortgage onlyonlyeffectedeffected inin thethe towntown notifiednotified byby thethe statestate govtgovt..TitleTitle DeedsDeeds meansmeans documentsdocuments oror deedsdeeds oror legallegalinstrumentinstrument whichwhich provesproves thethe rightright ofof aa personperson inin aa

particularparticular propertyproperty..

E. Anomalous Mortgage [Sec 58(g)]E. Anomalous Mortgage [Sec 58(g)]Mortgage Created not covered by above types ofMortgage Created not covered by above types ofmortgage, means it is generally combination of themortgage, means it is generally combination of the

above two or three mortgages.above two or three mortgages.


20/26

Cont..Cont..2. Pledge2. Pledge

PledgePledge meansmeans bailmentbailment ofof goodsgoods forfor thethe purposepurpose ofofprovidingproviding securitysecurity forfor thethe paymentpayment of of debt debt ororperformanceperformance ofof promisepromiseThereThere mustmust bebe aa actualactual deliverydelivery ofof goodsgoods..

3. Hypothecation3. HypothecationHypothecationHypothecation meansmeans aa chargecharge againstagainst movablemovablepropertyproperty forfor anan amount amount of of debt debt wherewhere neitherneitherpossessionpossession nornor ownershipownership isis passedpassed toto thethe creditorscreditors..GoodsGoods remainremain inin thethe possessionpossession ofof thethe borrower,borrower, onlyonly

equitableequitable chargecharge isis createdcreated overover movablesmovables..4. Assignment4. Assignment5. Lien, and5. Lien, and6. Set6. Set--offoff


21/26

ContContWith this KnowledgeWith this Knowledge

Read the Sanction Letter carefully, what type of chargeRead the Sanction Letter carefully, what type of chargeis mentioned in the same and Review the documentsis mentioned in the same and Review the documentsthat the same is obtained is in consonance with thethat the same is obtained is in consonance with thestipulations of the sanction or not?stipulations of the sanction or not?

For Guarantee, Letter of GuaranteeFor Guarantee, Letter of Guarantee

For Hypothecation, Hypothecation DeedFor Hypothecation, Hypothecation Deed For, Assignment, Lien and SetFor, Assignment, Lien and Set--off, Deed of Generaloff, Deed of GeneralLetter of Lien and Letter of SetLetter of Lien and Letter of Set--off.off.

For Pledge, Deed of PledgeFor Pledge, Deed of Pledge For Mortgage, Generally memorandum of deposits ofFor Mortgage, Generally memorandum of deposits of

title deedstitle deeds In Case of Bank Guarantee, Counter GuaranteeIn Case of Bank Guarantee, Counter Guarantee Letter of Partnership/Proprietorship/ResolutionLetter of Partnership/Proprietorship/Resolution Insurance/ECGC/Forward ContractsInsurance/ECGC/Forward Contracts Any other undertaking mentioned in the Sanction LetterAny other undertaking mentioned in the Sanction Letter


22/26

ContContC. REVIEW OF THE ACCOUNTSC. REVIEW OF THE ACCOUNTS

-- Audited AccountsAudited Accounts

-- Achievements with TargetsAchievements with Targets

-- Account with other banksAccount with other banks

-- Turnover with Bank and in BooksTurnover with Bank and in Books-- Adhoc facilities granted, request letter from theAdhoc facilities granted, request letter from the

borrower and justificationborrower and justification

-- M.O. Reports i.e. Branch Visit ReportsM.O. Reports i.e. Branch Visit Reports-- Other Audit RemarksOther Audit Remarks

-- Letter of Acknowledgement of Debt.Letter of Acknowledgement of Debt.


23/26

Important RBI CircularsImportant RBI CircularsBankBank havehave ceasedceased toto issueissue aa passpass bookbook toto thethe savingssavings

accountaccount holdersholders (Individual),(Individual), BankBank areare advisedadvised totoinvariablyinvariably offeroffer thethe passpass bookbook facilityfacility toto allall itsits savingssavingsbankbank accountaccount holdersholders (Individual)(Individual) withoutwithout anyanychargescharges..

RBI/2006RBI/2006--07/139 dated 04.10.200607/139 dated 04.10.2006

TDSTDS requiredrequired toto bebe deducteddeducted fromfrom thethe paymentpayment ofofinterestinterest paid/payablepaid/payable underunder seniorsenior citizencitizen savingssavingsaccountaccount schemescheme 20042004 oror toto obtainobtain FormForm NoNo.. 1515HH..

RBI/2006RBI/2006--07/171 dated 10.11.200607/171 dated 10.11.2006BankBank ShallShall ObtainObtain thethe CertificateCertificate fromfrom thethe approvedapproved

architectarchitect thatthat constructionconstruction ofof thethe propertyproperty isis asas perperthethe approvedapproved planplan && affidavitaffidavit fromfrom thethe borrowerborrower ininthisthis regardregard shallshall alsoalso bebe obtainedobtained inin casecase ofof housinghousingloansloans..



24/26

ContContIfIf lockerlocker notnot operatedoperated forfor moremore thanthan oneone andand threethree years,years, bankbankshouldshould immediatelyimmediately contactcontact thethe lockerlocker hirerhirer andand adviseadvise themthem totooperateoperate thethe lockerlocker oror surrendersurrender thethe lockerlocker thoughthough rentrent paidpaidregularlyregularly byby thethe lockerlocker hirerhirer..

RBI/2006RBI/2006--07/198 dated 04.12.200607/198 dated 04.12.2006InIn casecase ofof seniorsenior citizencitizen savingssavings schemescheme 20042004,, ifif nomineesnominees areareNRINRI and/orand/or PIOs,PIOs, inin casecase of of deathdeath of of seniorsenior citizen,citizen, thethe

nomineesnominees cancan neitherneither continuescontinues thethe accountaccount nornor repatriaterepatriate thetheproceedsproceeds ofof thethe accountsaccounts..

RBI/2006RBI/2006--07/217 dated 22.12.200607/217 dated 22.12.2006BankBank shouldshould dodo awayaway withwith thethe staplingstapling ofof anyany notenote packetspackets..BankBank shouldshould sortsort notesnotes intointo rere--issuableissuable andand nonnon--issuable,issuable, soiledsoiled

notesnotes inin unstapledunstapled conditioncondition maymay bebe tenderedtendered atat RBIRBI inwardinwardremittanceremittance throughthrough currencycurrency chestchest.. BankBank shouldshould forthwithforthwith stopstopwritingwriting ofof anyany kindkind onon watermarkwatermark windowwindow ofof BankBank notesnotes



25/26

ContCont

BankBank shouldshould obtainobtain minimumminimum twotwoindependentindependent valuationvaluation reportsreports forfor thethepropertiesproperties valuedvalued atat RsRs.. 5050..0000 crorescrores ororaboveabove..

RBI/2006RBI/2006--07/224 dated 04.01.200707/224 dated 04.01.2007BankBank shouldshould notnot grantgrant freshfresh loanloan oror renewrenewexistingexisting loansloans inin excessexcess ofof RsRs.. 2020..0000 lakhlakhagainstagainst NR(E)RANR(E)RA andand FCNR(B)FCNR(B) Deposits,Deposits,

eithereither toto depositorsdepositors oror toto thirdthird partyparty..



26/26

Thank YouThank You

Worry is theWorry is the

Interest you payInterest you payon troubleon trouble (Loan)(Loan)before it comesbefore it comes

(disbursed)(disbursed)