1995
OREINTAL BANK OF COMMERCE
CHIARMAN'S REPORT
ESTEEMED SHAREHOLDERS,
At the outset, I extend to you a hearty welcome and place before you Bank's
Annual Report for the year 1994-95 for the first time after nationalisation
of the Bank 1980. As you are aware, OBC has had the distinction of being
the first nationalist Bank of tap capital market after the Bill to amend
Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980
was passed in the Parliament. I cannot but feel a sence of pride on the
overwhelming responce the issue received from the public. The issue not
only accorded wider publicity to the Bank but also offered an opportunity
to share its prosperity with a large number of investors like you spread
all over the country. I assure you that OBC shall do everything possible
to come up to your expectations.
Coming to the performance of the Bank during 1994-95 it has been excellent
on various fronts. The net profit of the Bank increased by Rs. 81.25 crore
(253.04%) from Rs. 32.11 crore in 1993-94 to as high as Rs. 113.36 crore in
1994-95. The capital and reserve increased significantly to Rs. 709.48
crore as against Rs. 244.60 crore in the previous year, i.e. up by Rs.
468.88 crore (190.06%). The Earning Per Share (EPS) during 1994-95 based
on average weighted capital works out Rs. 7.71 as against Rs. 3.35 in 1993-
94. The deposits growth of the Bank was of the order of 27.38%. Bank
credit during the above period expanded by around 37%. The Bank has
already fulfilled the norm of priority sector lending of 40% and the export
credit of the Bank constitutes 12.48% of its total net credit as against
the prescribed norm of 10%. During 1994-95 the Bank opened 35 branches
including 7 specialised branches to take its branch network to 618 spread
over 19 States and 1 Union Territory. Keeping in view Bank's excellent
performance, it has been accorded P 1 + Rating for the Certificate of
Deposit programmer and FAAA Rating for the Fixed Deposits Programmer by
CRISIL. These ratings indicates Highest Safety regarding timely payment of
interest and principal by the Bank.
I am pleased to state that during the very first year of going public, the
Bank proposes to declare a dividend of 18% on prorata basis. This is
higher than 15% mentioned in the Offer Document and stands testimony to our
commitment for an increased return on the shareholders investment.
Banking is undergoing significant changes. The process of economics
reforms and libralisation undertaken since the last few years and the
various measures announced thereunder have opened new opportunities and
chalalenges for the banking system. Banks have, therefore, to reorient
their activities and energies their areas of operations in a manner
conducive to the changing scenario. This is one single factor that would
ensure their futher vaibility. We, in OBC, have created many reocrds in
the past few years. The financial highlights for the last five years given
in the Annual Report indicate Bank's handsome growth in business and its
spectacular performance in other key areas of operations. The customer
service of the Bank is of very high order and industrial relations excellent. Each and every employees of OBC is fully committed and
dedicated to the task of taking this Institution to glorious heights in the
coming years. Your entry as a shareholders has added further strength to
our mission and I have no doubt that with your continued mission and I have
no doubt that with your continued support and cooperation we shall make OBC
one of the strongest banks not only in the Indian market but international
nationally too.
Your Sincerely,
(S.K. SONI)