INTRODUCTION OF CO-OPERATIVE BANK

Unlike commercial banks which are engaged in serving the industrial and commercial sectors of the economy, the cooperative banks, on the other hand provide credit and allied facilities to the rural and agricultural sectors. The dawn of this country saw the evolution cooperative movement in India. Cooperative societies came into being when the Cooperative Societies Act, 1904, was enacted. The movement was started with the aim of providing farmers funds with low rates of interest so that exploitation by the village moneylenders is foiled. The Act provided for the formation of cooperative credit societies and a number of small primary credit societies were established in various parts of the country. These societies, however, could not mobilise enough resources as compared to loans demanded by its members. This led to the enactment of a new act in 1912. The Cooperative Societies Act of 1912 provided for starting Central Cooperative Banks with headquarters located in urban centers. In 1914, necessary steps were taken by the then government to strengthen the cooperative movement .The government appointed the Maclagan Committee to look into and make recommendations for the improvement of a State Cooperative Bank for each State. The state Cooperative Bank is formed by the federation of Central Cooperative Banks functioning at the district level. The present organisation of the cooperatives in India is based on the recommendation made by the Maclagan Committee. In 1919, the Montague Chemsford Act made Cooperation a provincial subject. Since then, separate Cooperative Societies Acts have been passed by all state governments. Although cooperative banks in India have shown progress since their establishment, there still exists a number of defects in the organisation. This has led qualitative improvement to suffer. However, the Reserve Bank of India took

the initiative to revitalize, reorganize and promote the growth of cooperative banking in India. Under the Banking Regulation Act of 1949, Cooperative banks have been brought under the control of the Reserve Bank of Bank. Farmers in India are scattered all over the country and need short-term small borrowings for agricultural purposes. This need is not fulfilled by commercial banks which are unsuited for financing agriculture. Land which these farmers can offer to cover bank advances is not generally accepted as security by commercial banks. Therefore, special types of banks are necessary for the financing of agriculture. Co-operative banks are best suited for this purpose. The object of cooperative banks is to offer banking facilities to persons of limited means requiring credit for productive purposes in the use of the land and labour at their disposal. The co-operative banking structure in India may be divided into three component parts, viz.,

1. Primary co-operative credit societies. 2. Central / district co-operative banks. 3. State co-operative banks (also called as apex banks) at the top.

1. Primary co-operative credit societies: -

Primary credit society is at the bottom of the three-tier structure of cooperative banks.

The society normally contacts farmers. So, only a few people living within the area of society are admitted as members. Here individuals of a particular area meet together inspired by sentiment of co-operation. Every member has to pay his share In a share capital. The price of a share is nominal so that even a common

man can be a member. The functioning of such society is limited. The society is managed by elected people. Hon-secretary and members of working committee. Such a society collects its funds by admission fees ,share capital and deposit of people. In case of need such society also get finance from central co-operative banks or state co-operative bank. Normally society grants loans to members on individual responsibility.

2. District co-operative Bank: This bank is a link joining state co-operative bank with the primary credit society. After the report of all India rural advances inquiry committee in 1945, the central co-operative banks earned much importance the flow of rural advances reach to every farmer's home through this bank via credit society. In reality central co-operative banks were establish to supply financial help to primary credit society.

3. State Co-operative Banks: This is the apex bank in the three tier structure set up of the country. Maclegan Committee appointed in 1974 recommended to establish at least one state co-operative bank per state. To day every state has the state co-operative bank. This bank especially co-operative ordinates them and give required guidance. There were approximately 26 state co-operative banks at the end of 77/78 in India.

Since state co-operative bank is an apex bank, its main function is coordination of co-operative lending, its balance and controlling. The financial help for co-operative lending activity given by Reserve Bank is also given through state co-operative bank.

OBJECTIVSS OF THE PROJECT y The main objective of behind this project is to analysis the actual position of NPA deeply

y To know about the NPA classification and provisioning requirement for non-performing asset:

y To calculate the total non-performing asset and compare with other banks and on the basis to decide the growth rate of different bank.

y The main object is know about the proper system of bank for reducing nonperforming asset or for conversion of non-performing asset.

y To know the various and strategies for non-performing asset for the bank.

y To learn about how to solve the problem of non-performing asset.

Scope of the study Credit card and debit card system and ATM card RTCS system IFC code system

LIMITATION
o The bank I have chosen is totally on rural or agricultural bases, so the bank cannot provide some English literature for helping me in project.

o It is on rural basis, and other banks, which are comparing and with it are not only rural basis so comparison will not made properly.

o This bank is on basis of rural or agricultural part so it will not accept the system of urban banks.

o The amount of loans and advances are also limited so it is obvious that the non-performing of this bank will les than the other comparatives banks.

o Non performing asset cannot be totally converted into performing asset but only these are some solutions for reducing it.

METHODOLOGY OF THE PROJECT This project is prepared on Non-Performing Assets. The methodology used in this project is as follows.

y First of all I have the basis studied the basic concept of NPA. y After the introduction, the asset classification is described and the provisioning norms for it by NAARD are shown. y All the above matters according to narsimha committee is shown. y Then according to NPA statement the NPA analysis is done on the basis of previous years financial data. y Comparative statement on the basis of various ratios is done. y At, last the recovery part is shown & various reasons, strategies, warning signals, recovery procedure and steps for reducing NPA are included.

Chapter 2 Company profile

Introduction to organization
Brief History : First decade of 20th century was a very important era in the history of cooperation for entire country and Surat District as well. Many cooperative institutions were initiated during this period. First Coop. Society in Surat District was registered at Degam, Taluka Chikhli on 23-51906 (Now in Bulsar District). In the year 1909, with the efforts of Late Shri B.A.Modi and Late Shri K.G.Desai. The Surat Dist Co.op.(Urban) union Ltd., was registered on 17-6-1909. It was the institution which is later on known as THE SURAT DISTRICT CO.OP. BANK LTD. In the year 1921, this society had undertaken banking activities in absolute terms. In 1923 The Surat District Co.op. (Urban) union was converted into The Surat District Co.op. Bank Ltd., The work extended to the entire Surat District, which had 21 talukas and a vast working area with geographical variation. The coastal area which included city of Surat and towns like Navasari Bulsar Bilimora, the fertile flat land and sizeable tribal area with hills and dense forests. The Vast Surat District was bifurcated in1965 and district of Bulsar was separated. At present there are 15 talukas in the Surat district, of which 9 are in the tribal area. Bank is having separate department for agriculture advances since 1944, and become an effective central agency for coordination and smooth flow of finance to cooperative sector in the district. Co-Operative Organizations like :     

The Surat District Milk Producers Co-op. Union Ltd.(SUMUL), The Purushottam Farmers Co-op. Ginning & Pressing Society Ltd., The Surat Distrcit Co-op. Spinning Mills Ltd., The Surat Jilla Sahakari Sale & Purchase Union., The Surat Central Co-op. Stores Ltd., Cotton Co-op Socities of Olpad Taluka,

have since been developed and Bank has provided timely assistance to them. During this period, Forest Labourers Co-op. Societies were also very active in tribal area and were engaged in coop cutting activity for which substantial finance was provided to them. After 1956 when Shree Khedut Sahakari Khand Udyog Mandali Ltd., Bardoli came into existence, the entire Surat District gradually became a sugar belt. All existing eight sugar factories had toothing financial troubles in the beginning, However, Bank had provided them enough finance as also assisted even for meeting share capital also. By lapse of time Sugar cane

has now become principal crop in the district and out of total cultivable area of 490000 hectares 83191 hectares is under sugar cane cultivation. This revolution in agriculture was amply

supported by The Surat District Co.op. Bank Ltd., These factories have become main strength of the economic structure of the district, particularly for farmers. All together these factories have a crushing capacity of 35500 tons per day. Annual sugar production exceeds Rs.880/- crores. Bank has sanctioned enough financial limits to this sector. Now a days, bank has started financing projects for Drip irrigation, Medicinal crops, Fishery, Green house etc. and would like to escalate the same on substantial extent. As per the instructions/ guidelines of NABARD, of-late, Bank has also started financing to the Non-farm sector including textile industry. Bank has been enjoying privilege of having prominent citizens in fields like Social, Co-operation and Agriculture, on its Board. The present and former members of the Board included outstanding Lawyers, Members of Parliament, District Panchayat Presidents, Mayor of Surat City and Leaders from various walks of life including Ministers.
Particular Deposite Advance Profit Gross NPA NPA% Recovery Networth 31-32010 237854.43 50282.66 775.00 1000.92 1.99 98 15640.11 31-2011 213704.05 51002.38 825.00 674.55 1.32 98.90 17114.55 Growth -10.15 +1.43 +6.42 -32.57 -33.67 +0.92 +9.42

Past Chairman of the Board Shri P.K.Desai was awarded Kaka Saheb Gadgil award for his outstanding services to the society and was also awarded by the Gujarat State Co.op. Union by Sahakari Award . Shree Popatbhai Vyas, the present Director on the borad, remained as Home Minister of the State. Shree Dilipbhai Bhakta, the present Chairman is also the Chairman of Madhi Vibhag Khand Udyog Sahakari Mandali Ltd., and also enjoying key position in different Co-operative Societies functioning in various fields. Bank has been also committed for overall upliftment of the society. Donations of lacs of Rupees are given to the Hospitals, Schools, Colleges and Social Charitable Institutions. Also a separate fund has been created for donations to the Educational organizations only. Another Trust is also created for Donation to the Charitable and Social Service organizations viz. Surat District Cooperative bank Charitable Trust. Bank has donated lacs of Rs. for the ultimate benefit of people affected with natural calamities to the different organization setup, for betterment of medical education etc. Management has always remained progressive, be a challenge after Bank Nationalization introduction of nonfarm advances, introduction of New banking concepts in liberalized economy.

Board has formed committees for loans, staff matters, Legal matters etc. Powers have been delegated appropriately to smoothen day to day working.

Conclusion : Bank has assisted all type of co. operative institutions and farmers in hours of crisis. In a natural calamity like floods, riots etc bank has assisted people of society oftenly. Bank has made remarkable progress during last 98 years and has successfully overcome the challenges . Bank's ,management and staff has worked hand to hand. Mutual confidence between staff union and management has benefited the organization. The bank was judged as best bank by NABARD & Best performance award for the year 1995-96 was awarded by NABARD. Bank has always been securing Audit classification under category A and has paid highest permissible dividend under state co.op. Act. To its members. Under the new environment of liberalization bank has to plan for modernization of its activities. To keep a pace with modern banking system, bank has accepted to go for Automation of banking work, at present all 57 branches are computerized. To mitigeded the customer's requirement of prompt service bank has plan for ancillays business like gold coin selling, work related to General insurance and life insurance has also started. Bank has recently decided to go for implementation of core banking solution in few selected branches in current year.

BOARD OF DIRECTORS NAME Shri Dilipbhai B. Bhakta (Chairman) Shri Amarsinh Z. Chaudhari (Vice Chairman) Shri Popatlal M. Vyas Shri Bhagabhai P. Patel Shri Maganlal R. Patel Shri Narayanbhai H. Donwala Shri Haribhai L. Patel Shri Ramanlal A. Patel Shri Sharadbhai S. Patel Shri Narendarabhai D. Solanki TELEPHONE NO (O)(0261) 2475772 (R)(02625) 233226 (O)(0261) 2470254 (R)(02626) 220036 (0261) 2227259 (02621) 247327 (02622) 255351 (02624) 222075 (02621) 223251 (0261) 2640331 (02628) 251039 (02629) 231675

Shri Maganbhai B. Vasava Shri Jaysinhbhai D. Vasava Shri Kiritbhai R. Desai Shri Pravinchandra C. Parekh Shri Parbhubhai N. Vasava Shri Chotubhai L. Patel Shri Nayanbhai N. Bharatiya Shri Jayantibhai U. Patel (Apex Bank Nominee) Shri Vasantbhai M. Desai (Government

(02628) 222125 (02629) 253542 (02622) 265237 (02625) 256869 (O) (02623) 271188 (0261) 2432253 (R) (0261) 2223219 (O) (02632) 220646