A revere wipe frre aren fern PROJECT REPORT ON ce STUDY OF LOAN SYSTEM AND ITS MANAGEMENT WITH SPECIAL REFERENCE TO LOKMANGAL CO-OP. CREDIT SOCIETY LTD, SOLAPUR (BRANCH:-SANGOLA) To PUNYASHLOK AHILYADEVI HOLKAR UNIVERSITY SOLAPUR In partial fulfillment of the Award of the Degree of Master of Commerce SUBMITED BY | MR. GANPATI .D. GUND INDER THE GUIDENCE O aN 4 pR.S.T. MORE | 0 <) THROUGH DEPARTMENT OF COMMERCE DESHBHAKTA SAMBHAJIRAO GARAD MAHAVIDYALA MOHOL 2022-23 | PagelDIRECTOR CERTIFICATION This is to certify that the project entitled " A STUDY OF PERFORMANCE OF LOAN SYSTEM AND RECOVERY MANAGEMENT" OF LOKMANGAL CO. OP CREDIT SOCITY LTD, SOLAPUR prepared by [Link] .[Link]. Impartial fulfillment MASTER OF COMMERCE is carried out under the dto the supervision and guidance of DR.S. T MORE and same is forwa university. lalso wish her all the best for her career and success to every step she Move in life. Date: _ _ 2023 MR. PRAVIN .S. JAGDALE (BRANCH MANAGER) ee Page 2Reg No Date: 2022 CERTIFICATE This is to certify that Mr/Ms. GANPATI. D. GUND has successfully completed his/her SIP titled "THE STUDY OF LOAN AND ITS MANAGEMENT" on partial fulfillment of degree of MASTER OF COMMERCE under PUNYASHLOK AHILYADEVI HOLKAR UNIVERSITY SOLAPUR in Academic Year 2022-23. DR. S.T. MORE Prof. (Dr). PATIL.N. J (Project Guide). (PRINCIPAL) PRN NO. 202101003011757 Place: MOHOL DATE:- - 20 Page 3DECLARATION | hereby declare that the project report entitled "A STUDY OF PERFORMANCE OF LOAN SYSTEM AND RECOVERY MANAGEMENT", with reference to "LOKMANGAL CO-OP. CREDIT SOCIETY LTD, SOLAPUR " is an original work prepared by me under the guidance of DR S.T. MORE the empirical findings in this report are based on the data collected during the project work. The matter included in this report is true and verified. This report has not been presented anywhere else of the awarded of any degree, diploma or title. | understand that any such copying is there then. | liable to be punished as the authorities deem fit. Date Cruel MR. GANPATI .D. GUND Page 4ACKNOWLEDGEMENT This study is an attempt A STUDY OF PERFORMANCE OF LOAN SYSTEM AND. RECOVERY AND MANAGEMENT WITH LOKMANGAL CO-OP. CREDIT SOCIETY LTD, SOLAPUR, | owe my deep sense of gratitude for this for this successful completion of this project was made possible through co- operation of many people. | am deeply conscious of the fact that study would have not been possible without willing co-operation of Mr PRAVIN |S. JAGDALE (Branch Manager) by giving permission for collecting the data | also extend thanks to m project Guide DR. ST MORE. for valuableguidance | Date |INDEX CHAPTER NO TOPICS | PAGE NO ae | INTRODUCTION TO STUDAY Voihamaarel anger | Object 7a Scope 2. BANK PROFILE Introduction of organization 12-14 L —_|___History of orgonaization a THEROTICAL BACKGROUND | Concept and definition | 15-27 | | Basic,types,techniques _ | z| 4 LITERATURE REVIEW | 28-30 aay 5: DATA ANALYSIS AND INTERPRETATION ae | 31-36 | E | : ae | 6. OBSERVATION AND FINDINGS 37-39 ia "| SUGGESTIONS ae asa | 40-42 | BIBLIOGRAPHY E | 43-44 | Page 6 |HAPTER 1 INTRODUCTION OF THE STUDY Page 7INTRODUCTION OF STUDY Banking” is witnessing the rapid change than ever before. The age old "Business of deposits from the public for purpose of leading” has become more diversified and complex with added services offered to public. With the liberalization and opening of services industry. banking sector witness spurt of neo private bank with state of art technology resulting in banking industry. Customer expectation increased necessitating rapid change in technology to suit the changing business requirement thus has become a prerequisite in maintaining competitive edge over other players Thus it can be observed that the Indian banking landscape has witness unprecedented transformation in the decide from operating in tightly regulated and to an increasingly deregulated and marked driven comparative environment. Alongside introduction of new players and instruments there has been strengthening of financial, indian banks are now well placed to capitalized on increasing global opportunities for further growth through diversification in words of RBI governor Dr. D Suburban "Our banking cannot afford to lag behind international standard nor remain unaffected by global development in banking” Origin of the world: The World Bank was borrowed in middle English from middle office bank from old ifficu banca, from Old High German banc, bank "bench center”. Benches used as desks or exchange counter during the Renaissance by Florentine bankers, who used to make their transaction atop desks covered by green tablecloths. Definition The definition of bank varies from country. Under English common law, a banker is defined as a person who carries on the business of banking, which is specified as: Conducting current accounts for his customer ‘Paying cheques drawn on him, and © Collecting cheques for his business Banks often start as microcredit or saving clubs which become formalized, first as credit. Unions and later savings which transform themselves from co-operatives to limited liabilities companies A fuller difficulty of these forms appears below. Da... Page 8Banking is generally a high regulated industry, government restriction on financial activities by bank have varied over time location Economy func in: The economic function of bank includes: 1. Issue of money in the form of bank notes and current accounts subject to cheque or payment. At the difficult order. This claim on banks can act as money because they are difficulty or repayable on demand, and hence valued at par. They are effectively transferable by mere delivery, in the case of bank notes, or by drawing the cheque that the payee may bank or cash. 2. Netting and settlement of payment: banks act as both collecting and paying agent for customer, participating in interbank clearing settlement system to collect, present, be presented with and payment with, and payment instruments. This enable banks to economize on reserve held for settlement of payment, science inward and outward payment of set each other. It also enables the difficulty of payment flows between geographical areas, reducing the cost of settlement between them, 3. Credit Intermediation: banks borrow and land bank to bank on either on their own account as middlemen. 4. Credit quality improvement: bank lend money to ordinary commercial and personal borrowers [ordinary credit quality], but are high quality borrows the improvement comes from diversification of banks assets and the capitals which provides a buffer to observe losses without difficulty on its obligations however bank notes and deposits are generally unsecured; if banks gets into difficulty and pledges assets as security to rise the funding its needs to continue to operate, this puts the note holders and depositions in an economically subordinating position. 5. Maturity transformation: banks borrow more on demand debt and short term debt, but provide more long term loans. In other words, they borrow short and lend long, With a stronger credit quality than most other borrows, bank can do this aggregating issuesle.g. accepting deposit and issuing bank notes] maintaining reserve of cash, investing in marketable securities that can be readily converted to cash needed and raising Page 9replacement funding as needed from various sources (e.g. wholesale cash markets and securities markets. Objective and importance of study: 1. To evaluate the financial ranking: The fiscal positioning of an enterprise is influen fiscal reserve it possess, its monitory arrangement, its liquidity and its com to transformation in market in which it operate. etence to get used 2. To evaluate the bank performance: is the aptitude of the enterprise to accrue revenues that have been endowed in it. Knowledge about the capacity and inconsistency of revenues assists the firm in predicting the anticipated monetary flows from the firm current reserve and in Predicting possible additional found influx from extra resources that can be endowed in the enterprise... 3. To evaluate the alteration in fiscal ranking: users of fiscal report look for information about the endowments, subsidizing and financial activities that the enterprise embark on while treatment period. This data assists in evaluating how effectively the enterprise in able to generate fund and money and how the firm uses the cash influx 4, The main objective of doing this project is to study the corporate culture 5, To analyze various method of operating loan facilities. Scope of study in future circumstance. B. To indicate the amount, timing and probability of future cash flows A. To provide information on bank liquid and NPV and ability to change cash flows. Study is restricted to the B. Also fund flow has their own limitation. For listed bank cash flow is mandatory and is recognized by ICAI C. Days are insufficient to study the whole loan system of the LOKMANGAL CO-OP, CREDIT SOCIETY LTD, SOLAPUR. d. The secrecy of holders prevents the researcher from getting extra information, Page 10Limitation of study: 1. This study is restricted to LOKMANGAL CO-OP. CREDIT SOCIETY LTD, SOLAPUR. 2. This study Is based on primary and secondary data. All limitation of primary and secondary data applicable to this study, 3. A period 30 days is sufficient for the purpose of the study. Research Methodology The two data collection method had been used for collection company data A. Primary data collection B. Secondary data collection C. Primary data collection The primary data collection from Discussion with the employees and observations of the banking system. Secondary data collection The sources of secondary data collection are Bank website Through internet Books Bank magazineCHAPTER 2 BANK PROFILE —_—— $$ Page 12Bank profile Introduction of LOKMANGAL MULTISTATE CO- OP. CREDIT SOCIETY LTD, SOLAPUR Established 28 APR 1998. © Registered under Co-Operative Credit Societies Act, 1960" registration no MSCS/CR/420/1998 © Registered under "Co-Operative Credit Societies Act, 1960" registration no MSCS/CR/420/1998 DT 28/04/1998 During the early period of LOKMANGAL CO-OP-SOCITY, its founder needed some finances for its development purpose. He approached a local leading which showed little enthusiasm in loaning out any amount to this baby institution. This was a very challenging situation for him, with whi of LOKMANGAL CO-OP-SOCITY ch he dealt successfully by establishing his own bank" in 1998. in this task he got co- operation from his colleagues who had tremendous faith in his abilities. Within a short span of time the bank won over the confidence of hundreds of its customers and established its reputation as one of the trustworthy and leading bank The bank has now 100+ branches and one extension counter operating in, MAHARASTRA and KARNATAKA at other places located mostly in rural areas. the locker facilities are provided in most of its branches. © There are three landmarks u of Underlining the ever ascending graph of success of LOKMANGAL CO-OP-SOCITY. © The bank has earned a audit class every year continuously since its establishment The bank has paid to its share holder's annual dividend at the rate of 15% every year. @ The bank is one of the few bank in Maharashtra, which has been given the status both as a f ns r k Pagel3History of the bank LOKMANGAL Co-Operative Society Itd. Solapur has been established on 28/04/1998. Mr. SUBHASH S. DESHMUKH is the organizer of LOKMANGAL only in eight years multistate start branches in cities and also in other cities. He approached local leading bank, which showed little enthusiasm in loaning cut 15.25,000/- to this baby institution this was very challenging situation for him, with which he dealt successfully by establishing [Link] bank LOKMANGAL Solapur as on 28/04/1998. The shareholder, customer. employee and well-wisher are integral part of the progress on the bank. Their involvement and contribution is immense which help us for making the progress of the bank in large. LOKMANGAL CO-OP-SOCITY having vision of opening branches in all territories like rural camp: urban areas, to develop society by economic upliftment of people at large, bank is working hard with mission of "reaching every person who is needful for his and societies overall development" Mr. SUBHASH S. DESHMUKH, founder of the bank has established the bank with motto/goal to uplift the life of common man of the society and make himself sufficient on economic front. Bank having more than 25 bank lacks customers, along with mix business more than rs.1300 Cr. and earned net profit of rupees 39 cr. as on 31 MAR 2022. had made steady progress of LOKMANGAL CO-OP-SOCITY and today bank has 100+ branches and spread in MAHARASTRA AND KARNATKA by knowing competition bank introducing shortly rtg, next and net banking facility as acustomer service Vision: Opening branches in all territories like rural and urban areas, to develop society and helping nation development, progress. Mission: Reaching every person who is needful for his and societies overall development. PageCHAPTER 3 THEROTICAL BACKGROUND Vays 15Indian economy: An Indian prepared herself for becoming an economical super power. it must expedite socio- economic reforms an take steps for overcoming institutional an infrastructural bottleneck in the rent in system. Available of both physical and social infrastructure is central to sustainable economic growth. Since independence Indian economy thrived hard for improving its pace of development. Not ably in few years the cities in indian had undergone tremendous infrastructure up gradations but the situation is not similar in most part of rural Indian. Similarly in the realm of health and education and other human development indicators Indian performance has been far more satisfactory, showing a wide range of regional inequalities with urban area getting most of the benefits. in order to attend the status that currently only few country in the world enjoyed and provide a more egalitarian society to its mounting populations, appropriate measures need to be taken. Indian banking industry the major participants of the indian financial system are the commercial bank, the financial institutions (Fil) encompassing team-leading institutions, investment institutions, specialized financial institutions and the state level development banks, non banking financial corporation's (NBFCS) and other market intermediaries such as stock brokers and money lenders, the commercial banks and certain variants of NBFS are among the oldest of the market participants. The FIL (foreign institutional investor) on other hand are relatively new entities in the financial market place. With years, banks are also adding services to their customer, the customer. The customer have more choice in choosing their bank. a competition has been established within the bank operating in Indian. With stiff competitions and advertisement of technology, the service provided the bank has become more easy and convenient. The past day are witnesses to an our being cleared in one month in the south. This section of banking deals with the latest discovery in banking instruments along with the polished version of old system. Page 16* Liberalizations of the Indian banking industry: During the 1990's the Indian banking sector witness more reforms than most other sector of the Indian economy. interest rates have been. deregulated, and entry into the banking sector has been liberalized. The cash reserve ratio and the statutory liquidity ratio are their historical tows, there by granting the bank control over a greater shares of their deposit base. Bank is | now to invest in hitherto for contraband asset like equity. Further on interest income by way of fees and off balance sheet activities is Increasingly becoming in important part of bank revenues, Finally routinely take position in the markets for complex instruments like derivatives. As part of economic reforms banking industry has been deregulated, and made competitive, new players have added to competitions, Further due to exposure to global trends after information explosion led intern. Customer both individual and corporate is now demanding better services with time and stop financial supermarket. Eventually the bank plan to market bonds and debentures, when allowed, Insurance pending by will be reality soon. debenture, liberalization we find the that banks that today are able to offers a number of products of which compensation play a fundamental role for these customized products as we ‘shall see later in our distribution. * Advances changes and effects: Indian banking industry has made rapid strides on many fronts reaching greater heights in profits, resources mobilization and credit diversification and in extending computer based achievements. Expanding the retail credit segment has become the hallmark of their resources development: housing loan and personal loans have moved in to the forefront. atoms instead of opening new branches is the new strategy adopted for special expansion. New frontiers have been opened in customer's relations, anywhere banking is the supplements by real time gross settlement, spending up cash transfers. On the industrial relation front, the prevalence of cordiality is reflected in an improvement in labor productivity, even if employee all banks barring a few exceptions has reported appreciable improvement. Thanks to new low interest regime, most urban Indians are in the position to attain the dreams in their thirties and even in their twenties and play for it equated monthly installment Page 17Business of banking: In today global banking is a business. But ike other business it not only concentrated on maximization of profits but also customer services satisfaction; because customer is king. And without depositing them back cannot grant loan. So it has to main functions i.e "accepting deposit and granting loans" on deposits it pays interest where on loans it charges interest & the rate of interest on deposits is always lower than the rate of interest for loans. The difference between these two constitutes the banks. Business of banking Accepting Grantin deposit gloans As without granting standard loans bank does not service so now we concentrate more on that function.LOANS: Very often in economics the benk is described as » manufacture of credit or 2 desler in credit Whatever be the name the bank has to give loans because they will bring the establishment. Therefore credit le NOt only sources of banks income but also the ife blood for survival TYPES OF LOAN: 1 loan 2. Conforming oan 3. Mon-contorming loan 4 Secured toan 5, Unsecured loan 6. loan 7, Case-ended loan 1) Conventional loans Conventional loans are mortgage loans from mortgage lending institution not backed bby an agency of the government. Such as the US Department of Veterans Affairs or the Federal Housing Adm oF non-contorming 2) Conforming loans ton. Conventional loans can be either conforming A conforming loan conforms to the guidelines set by Fannie Mae and Freddie Mac The main guideline is the maximum loan amount. This amount can ary depending on the home’s lacation-for example, 2 house in high-income area can be eligible for a larger loan than one in 2 general income area. Other qualification guidelines are concerned with the borrower's debt-to-income ratio, loan-to-value ratio and credit history. 3) Non-Conforming Loans Non-Contorming loans do not conform to the qualifications and guidelines set by Fannie Wae and Freddie Mac corporations. if you require a loan larger than a conforming loan, you will be looking at non-conforming loans, such as jumbo loans. LSS Page 194) Open-ended loans open-ended loans that you can borrows ove and over. Credit cards and lines of credit are the most common types of open. ended loans, Both of these loans have a credit limit which is the maximum amount we have to borrow at one time. We can use all or part of our credit limit depending on our needs, 5) Closed-ended loans | Closed-ended loans that cannot be borrow again once they have been repaid. As we make payment on closed-ended loans, the balance of the loan goes down. However we don't have any available credit we can use on closed-ended loans | ‘A. NON FUND BASED: Here the bank stand as a guarantor or a surety on behalf of the customer where no fund are released as in the case guarantee, differed payment guarantee, bid bank, acceptance on bills. The bank will pay the amount undertaken in the case of default. Here the bank collect commission on the amount guaranteed say at 2% per annum and advance and levies penal interest. If there are no defaults or claims the commission will be a clean profit as no funds are involved. These facilities are called | “off the Balance Sheet" transaction because they are only contingent liabilities and | not direct liabilities: They are "Free based Transaction" where only commission or fees are collected and not interest. This type of loan includes letter of credit (IC). Bank Guarantee [BG] solvency Certificate, etc 8. FUND BASED: | Here the bank acts as a lender or creditor by releasing fund as in the case of loan cash, cheque purchase and Bill Discounting Facilities. On these facilities the bank collects interest. So here cash outlay occurs. Fund Based Loans are further divided in two types such as 1. Secured Loans 2. Unsecured Loans ET Page 201) SECURED LOANS: incase of secured and partly security or the docume to the property are pi bank derives its right of Hold over the security by virtue of various provisions of the Indian Contract Act 1872. The Negotiable Instrument Act 1881, and The Transfer of Property Act 1862 ts evider ed on to the bank. As a creditor th ing the right of title Examples of secured loans are HOUSING LOANS, EDUCATION LOAN, VEHICAL LOAN, etc. secured loan can classified as 1. Priority Sector Loading 2. 2Weaker Sector Leading 1. Priority Sector Lending: To appreciate the spirit behind the priority sector leading we may have to further divide it into two segments the General Priority and The Core Priority Sector. The core priority is consisting of the anti poverty programs sponsored by the Government for the poorest among the state. In the general priority 5 Jean amount depends upon limit. The borrows is required to bring in 1 tor, the argin money from his own sources and sometimes guarantees and collaterals are also insisted depending upon the strength and weakness of the case, The credit proposals are not sponsored by any sponsoring agency and monthly the intending borrows themselves have to approach the bank of fir The following are included under priority sector advances 1 Agriculture: Direct finance to farmers and indirect finance to agriculture include credit for financing of fertilizers, pesticides, seeds, etc 2. Funds to Regional Rural Banks 3. Small Scale SS Page 2Pa 4, Small road and water Transport Operation 5, Retail Traders 6. Small business 7. Professional and self employed person , Advance sanctions to state sponsored organization for SC/STS 9, Education loans [Link]: Direct finance 11. Loans to self-help groups and NGOs 12. Loans and National Minorities Development and Finance Corporation 13. Software Industry. 2. Weaker Sector Lending In the case of weaker sector, it is the Government Development agencies that sponsor the proposal to the bank. The schemes are meant for the very Poor people vino are suppose to live below the poverty line, to improve upon their standard of living by acquiring some means of livelihood through the bank finance. The target groups are socially and economically backward people and the income criterion is the income of the family as the whole. The sponsoring agency specifies the activity, amount of the and also the amount of the subsidy available. All that the bank has todo release the loan specified if otherwise found in order. The following are including under weaker section category: 1, Women 2. Small and Marginal Farmers3, landless Laborers 4, Tenant farmers 5, share croppers 6. Artisans 7. 1RDP. 8, SC/ST 9. DRI Beneficiaries 10. Self-help Group 11. Beneficiaries 2) UNSECURED LOANS: Unsecured advances shall include clean overdraft, loans against personal security, clean bill or Multi bundies purchases or discounted, cheques purchased and | drawalsai allowed against cherubs for collection but shall exclude a. Advance backed by guarantee of the central or state government, public sector financial bank and deposit insurance and credit Guaranties Corporation. Advances against supply bills drown on central or state government or state owned undertaking which are accompanied by duly authorized inspection notes orreceipted challis b. Advance against trust receipts C. Advance against D/A bills drawn under letters of credit 4. Advance against in land bills even where such bills are not drawn under letters of credit having since of not exceeding 90 days Page 23,a. ———____ . Advance granted to salaried employee against personal securities, provided, that the corporative societies Act of the state concemed contains an obligatory provision for deduction of periodical loan installment by the employer out of the employee salary wages to meet the banks claim and Provided further that the bankhas taken advantage of this provision in respect of each of such advance. F, Advance against supply bill drawn on provide of Parties of repute and receive | challenge of public limited companies and concern of r¢ or more than 90 days. SOURCES OF ‘epute and notoutstanding FINANCE: PRIVATE BANK SHEDUL a4 COMERCIAL | —__] PUBLIC BANK SECTOR BANK | | BANKS ae CO-OPRATIVE BANK DISTRICT CO- OPERATIVE BANK SIGNIFICANT ACCOUNTING POLICIES 1. Overview Bharti Sahakari co-operative bank Ltd, Solapur was registered in 8/9/1971 and in Providing banking and financial services.2, Basis of preparation the financial statements have been prepared and the historical under the historical convention on the actual basis of accounting and complete with generally accepted accounting principles statutory requirements prescribed under Co operative | societies Act Registration No. MSCS/CR/420/1998 date 28/04/198 And circulars and Guidelines issued by the Reserve Bank of India [RBI] Act. 1934 [schedule2] B,R,861/16.05.00/2001-02 DT. 17-5-2002, The R.B.1 License No UBD/MH. 892 p.. Date 26-10-1987. 3, Use of Estimate The preparation of the statement requires the management to make estimate and | assumption that affect the reported amounts of assets and liabilities Lincluding | contingent liabilities) as on the date of the financial statements and the reported income and expenses for the reporting period. Management believes that the estimate used in preparation of the financial statements is prudent and reasonable. Future result could differ from these estimates. Any revision in the accounting estimate is recognized prospectively. 4, Accounting Convention | The financial statements are drawn up in accordance with Historical Cost Convention and ongoing concem basis. 5. Revenue Recognition Items of and expenditure are accounted on accrual basis expect for the following: * Interest on advance classified on Non Performing Asset is recognized to the extend realize as per RBI Directives: Unrealized interest on such advances is shown | under the head overdue interest reserve. | * Commission and exchange and locker are accounted as income on receipt basis 6. Advances: | * All the advances are classified as per RBI guidelines into performing and non- performing assets. ne nea Page 25performing assets are further classified into sub-standard, doubtful and loss assets for recognition and provisioning, , Non income F « provision for non-performing assets is determined in accordance with RBI guidelines, 7. Employees Benefits: «The provision of employee provided fund and miscellane sole to the Multistate accordingly the contribution made t tothe profit and loss account, 'e0Us provisions applicable Act, 2002 rowards the provident fund is charged + A group gratuity LIC scheme has been accepted by the bank and premium paid towards the labiity of group gratuity is also charged to the profit and loss account as and when paid. + Leave encashment of the employees is accounted on cash basis. 8, Taxes Income: ‘+ Current tax expenses are measured at the amount expected to be paid inaccordance with the provision applicable for the asst2017-18. + Deferred tax is recognized subject to the consideration of prudence of timing difference representing difference between taxable income and accounting income and originated in one period and is capable of reversal in one or more subsequent period. Deferred tax assets and liabilities. ) Services Training to staff: Banks development is depending on the bank staff. Its depends on these devotion towards bank. Bank management and bank manager and their subordinates they have to maintain their personal relation very fast and helpful. Bank is always taking care of their staff security. To face the day to day new technology and there problems we have to give a special courses ‘egarding Modern Banking, high technology, quality technique and personality development. ) Core banking facilit Bank has adopted recently new core banking facility. Due to core banking we will provide quality and advance service to the customer. Page 26ee social bonding and cultural activity :In the co-operate filed the co-operative bank have to ) intain their good relation with social and cultural activity. We have to maintain social service a ; through banking: Page 27CHAPTER 4 LITERATURE REVIEW ee | Page 28,the present research deals with the identification of challenges faced by private banks in Mumbai ‘and recognize the contribution of recovery laws. The research also deals with evaluation of regulatory guidelines in bank loan recovery process. Hence, considering the same, study of literature has been undertaken by the researcher. [Link] (2003), in his article of "Non-Performing Assets - Causes, Extent and Remedies” has observed that conceptual irregularities in the guidelines issued by the Central Bank as the NPA position in Indian Banking is exaggerated, although called non-performing assets (NPAs) the ratio of non-performing credit is related to credit and not to assets. Dr. N. Bachhawat (2001) in "Management of Non-Performing Assets in Commercial Bank” has stated that the prudential norm of 90 days for classifying the A/C as NPA is very much strict looking to the Indian conditions where whole of economy i stil based on Agriculture and field is based on Monsoon and which is uncertain and erratic, instead of this Bank's should recruit technical/ field officers for vigorous follow up and supervision of such accounts. RBI should reassess to bring fresh policy for recruitment of field staff for follow-up and supervision to control NPAs. KH. Vora (2007) in his study entitled "Management of Non-Performing Assets And Asset Reconstruction Company” observed the impact of NPAS. The effect of NPA on the bank is such that there is loss of interest income and the current profit is reduced, es banks have to make provision for NPA. Further, Capital adequacy ratio is also affected as its directly related to the Quality of assets It also affects the liquidity position of bank as also recycling of funds due to asset liability mismatch Page 29Upadhyay (1994) in "Recovery through SEIZURE: Some Aspects Want to say that the legal actions involve takes high cost and long time. Even after settlement of the case, the decree has to be filed and executed periodically as per the term which is an unpleasant and difficult task, This process also slows down the speed of follow up and results in lethargic attitude by banker.CHAPTER 5 be DATA ANALYSIS AND INTERPERETATION » Page 31Disbursement of Gold Lone: (year | GOLDLONE PERCENTAGE 2021 194848751 —— a — 7023 359432158 42.18% —E_ yoral=~=~=«~*z Az =i Gold Loan 20 =202 2003 Interpretation : The above table is of Golden Loan. In 2021 the percentage sd loan is 22.86 %, in year 2022 the perscentage of loan Is 34. semana venice percentage of lone is 42.18 %,the highest percents8e of loan is in B And lowest percentage of loan is in 2021 le 22.86%. ll Page 32 |Disbursement of Mortage Loane |MORTAGELONE | PERCENTAGE ate a ~*([33seeeas6 Sata | 265892359 | es 389562348 ae | 791347163 10.00% Mortgage Lone Mortgage Lone 2021 202 2003 ferpretation: The above table shows disbursement of Mort oan. In 2021 the It jisbursement of Mortgage | bove table s! percentage of loan is 17.17 %in year 2022 the percentage of loan Is 33, 2 The highest percentage of loan is in 2023 .e.49.22% and lowest percentage of loans in 2021 Le 49.22%. M loan is it i,er Recovery Position of Loan ecovery of Gold Loan: R EAR GOLD LOAN PERCENTAGE ait | 6451897 iat ae jo | 92504185 33.34% | a3 98303456 ae Total | 277259538 00.00% ae | Column1 | Interpretation: the above table shows th the percentage of loan is 31. 18% in year 202: year 2023 the percentage of loan is 35.45%. 2 the percentage of loan is 33.3 The highest percentage is i Lie, 31.18%. s=2021 2202 2023 e recovery of Gold Loan. In year 2021 4% and in 2023 i.e. 35.45% and the lowest percentage of loan is in 202 Page34RECOVERY OF MORTGAGE LOAN i; Mortgage Loan Percentage 75956012 29.10% | 85987515 a 95998525 36.78% anaene i | 260942052 100.00 Mortgage Lone Mortgege Lone —_L Page 35Interpretation: The above table shows the recovery of mortgage loan. In year 2021 the percentage of loan is 29.10%, in year 2022 the percentage of loan 32.95% and in year 2023 the percentage of loan is 36.78%. The highest percentage is in | 2023 i.e. 36.78% and the lowest percentage of loan is in year 2021 i.e. 29.10%. tn ie nent nt Page 365.3 Non Performance Assets Non performance Assets of Gold Loan: Fh | Gold Loan Percentage 2021 325689235 35.10% 3022 145231656 15,65 2023 456892356 49.24% TOTAL 927813247 100.00% Gold Lone Gold Lone Interpretation: The above table shows the NPA of gold loan. In year 2021 the Percentage of loan is 35.10%. in year 2022 the percentage of loan is15.65% and in Year 2023 the percentage of loan is 49.24%. The highest percentage of loan is in 2023 i.e. 49.24% and lowest is in 2021 i.¢.35.10 — Page 37Year 2021 2022 2023 TOTAL 5.6 Non Perfomance assets of Mortgage Loan | Mortgage Loan | Parcentage 1 14819589 | 18.02% 28651881 | saa 38745327 ] 471 82216797 100.00%, Column1 Interpretation: The above table shows the NPA of Mortgage loan. in year 2021 the Percentage of loan is 18.02% in year 2022 the percentage of loan is34.84% and in Year 2023 the percentage of loan is 47.12%. the highest percentage of loan is in 2023 i.e. 47.12% and lowest percentage of loan is in 2023-19 i.e. 18.02% —____ Page38CHAPTER 6 FINDING AND OBSEVATIONS.pisbursement of loan system ;, ttwas found that a bank has disburse the into types in a. Gold Loan b. Mortgage Loan Which has found that the bank has disbursed the loan maximum through individual compare toconstruction loan. 2Recovery of loan system a. twas observed that loan maximum through mortgage loan compare to gold loan [Link] observe that the recovery performance of gold loan shows volatile but the performance of mortgage loan recovery process shows continuous increases [Link] overall the recovery proportion on of gold loan shows more compare to mortgage lone. 3. Non performance assets a. It was found that the performance of shows volatile position about gold loan and is shows satisfactory performance in 2023, nm Page.40». It was observed that the perfor mance of NPA indivi dissatisfactory because every year NPA position about individual shows quite an increased by 1% 2% and 3% 4, It was observed that the relationshi tionship of di gold loan ip of disbursement and recovery position of ae eee Page 41CHAPTER 7 CONCULSION AND SUGGESTIONa! 1 innovation loan system: it has suggested in future bank should try to focus to launch different types of innovation loan types as per potential customer/borrows categories wise such as 4, senior citizen types of loan b. Children plan loan [Link] + Widow + Women entrepreneur Which we help to increase number of borrows in future. 2. Strict policy on recovery system: It has suggested that in future the bank should try to follow strict policy and decision on recovery process. So in future the bank will achieve 0% NPA level in future. [Link] strategies: Ithas suggested that in future the bank should the following marketing strategies to increase satisfaction level of customer and borrowers. a. E-service b. For eg E-statement, E-alert of dues ©. Appreciation letter to the regular borrowers. 4. Conference, seminar and get together programs for depositor holder and borrowers to understand different level of problems in future. Page 43CHAPTER 8 BIBLIOGRAPHY DIDEEAana—10 Annual Report: Website: [Link]