Chairman's message

Dear Members,

I am proud and pleased to present to you the Balance Sheet and other financial statements for the financial year 2023-24 ended on 31st March. On examining the Balance Sheet and the statements you will also realize that you have maintained consistency in the business growth. You may not feel that the figures of the business are not attractive. However, if we think comprehensively, you will know that we have strengthened our inner capability. In any business the figures of the business are not important than the internal strength. An ideal business ensures that the internal strength is only going to take care of and to come out of the troubles, if at all they come in the future. Not only the banking, but a number of businesses, who went on increasing the figures of the business and overlooked the internal strength, not only landed into troubles but a number of businesses had to wind up their businesses unceremoniously. You know a number of such examples in the banking industry also. We have never shifted our focus from financial strength while increasing the business. You will observe this from the statements accompanying the Balance sheet and incorporated in this Annual Report. For me the business growth should have been more than what we ave achieved. However, I am happy that the inner strength has further increased.

When the external situation is fluid every business has to take decisions judging the coming future. It is not just possible to take accurate judgement of the future, however the events and the changes that are taking place, around us and beyond, provide certain clues. We should not overlook these indications. According to me external events impact us three way. Perhaps you may think as to how these events and situation can directly create an impact on us. It has been the experience of the past that every event and development, that takes place anywhere in the world, has the impact on most of the business world over. The degree of the impact may very, but the impact is sure to happen. The changes are broadly of three types. First,the changes caused by the fast changing technology. The technology is changing at such a pace that if we are negligent about this, we are surely to be pushed back. The Artificial Intelligence is in discussion now a days. This will drastically alter most of the sectors of businesses and social life which we cannot imagine. We have witnessed that the technology has removed human involvement from a number of sectors. Now by using only 10% human energy the work is being carried and that to more correct and faster. The second factor is the environmental changes. Global warming was so far a topic of discussion of the scientists and their warnings to the nations. Now, however, it has become the fact. The changes that are taking place in the environment are now very close to our lives. If we talk only about Maharashtra, we are witnessing that in Marathwada region, where the rains were scanty is getting devastating heavy rain. It is not that the percentage of the rainfall has changed, but the very time table of the rain has changed. It has become unpredictable and erratic. This causes tremendous damage to the agriculture and Government is compelled to provide assistance. This is necessary, but the funds that are expected to be used for the development of other sectors get diverted.The summer this year and also last year was hottest. This hot summers need more electricity, the hotter environment reduces the performance of human. The third factor is political changes. The changes in the polity are being watched and taken in to account by a number of international organisations. All these factors greatly impact the very living of the people.

During the current financial year there is adequate rainfall, inflation is under control and the GDP has increased. Therefore, the current year would be satisfactory as far as businesses are concerned.The progress of any business depends on the purchasing power, capacity and the needs of general public. All the above three factors, since put an impact, the businesses have to take these into account. For this we, though briefly, discuss the global situation. It is not the aim to take full review of the global situation. However, some changes happening elsewhere are mentioned here, because they have a direct or indirect impact on our business.

Global situation
I am mentioning only some selective events which have put pressure on economies of a number of countries. Rusia-Ukrain, Israel Palestine, Taiwan-China have a very tense and explosive situation. Such stressful situations are bound to put an impact on economies of the world.

Earth quakes, cyclones, heavy rainfall also greatly contribute to the adverse impact. One of the African countries has no water. The scarcity is so severe that the Government has imposed fine and action if anybody uses water even for bathing. The world is feeling the heat of Global warming. All these changes make various commodities scarce and the prices of these commodities increase. Purchasing power of the common citizen decreases. Obviously, since the savings is reduced, the first institutions that feel the pinch are Banking sector. The deposits do not grow with a reasonable pace and the demand for loan also decreases.

Progress of Pune People's Bank in the Financial Year
As stated above, since we have sharply focused on the internal strength, the figures of the business have not been inflated. In spite of this we have maintained consistency on all the parameters. The picture of the Banks performance would be seen in the following pages and could also be studies by the members.. Figures for 31.03.2024 are given below:

On looking to the above figures, I sure, you would feel that our progress should have been better than this. As said earlier our primary goal was to ensure that the internal strength is increased. Moreover, it has been our long term policy not to indulge any methods to increase and inflate the figures. Any business has to have a policy of earning profit and to strengthen the internal capacity. Some of the above figures are worth considering.

1) As per RBI directives Capital Adequacy has to be brought to 12% by the year 2026. We have however, not only achieved this, but have comfortably surpassed this required well before the dead line.

2) The requirement of Priority Sector advances was 60%. We have crossed this and have disbursed loans more than the mandatory level.

3) In respect of small loans we have surpassed the target 50% and have disbursed57% loans to this sector .

4) Per employee business has also improved to Rs.10 crore, which is an indication that we have been utilizing our efficiency adequatly.

You are aware that all the Directors of the Bank are performing a role of Trustee. Therefore, just for exhibiting unreal performance, the figures are never inflated by indulging in unwise decisions. The effect of this policy is that though the figures of business do not look attractive, the internal strength, that it organic strength of the Bank gets more stronger. Our Bank has never been involved in any financial scam or misdeed, nor has it been in the news for wrong reason. This is because of our policies and selfless working.

For your evaluation of the business of the bank all the statements are given in this Report. Instead of me making more comments on this, it would be more appropriate that you do the evaluation. I am happy and satisfied that the members of the Bank are keenly observing the working of the Bank and have been providing valuable guidance and suggestions from time to time.

Recently in one of his speeches Hon'ble Governor of Reserve Bank of India expressed his anxiety over declining growth rate of the deposits. He said that during the financial year 2023-24 the growth rate of loans has been more than the growth rate of deposits. This has happened because of increased financial literacy of common depositor, attractive investment options etc. There are now options of Stock, Mutual funds, which are offering attractive returns. The CASAdeposits have come down from 43% to 39%, which is a warning for the Banks to take special drives to ensure that the deposit growth is increased. Presently people are coming to Banks, most of the time due to the tax provisions of other investment options.

Reserve Bank Policies

After .February 2023 the Repo Rate is unchanged and is presently at 6.50%. According to the RBI's economic Report for 2023-24, the Growth Rate of Indian Economy would be 7%.. This estimate has been drawn taking into account the uncertain and erratic rain, political situation .GST collection, in the year under review has crossed 20 lakh crore. This indicates that the demand and the production in the coming year also would be at an increased level. Last year Government has created a separate Ministry for Cooperative sector. This would facilitate cooperative banks and other institutions to take up their problems directly to this ministry. RBI is keenly observing the position of Cooperative Banks from a view to ensure security of the depositors and has been taking harsh steps.

However, those bank which did not stick up to the norms, the licences of those banks were cancelled. Following are the figures of cancelled licences.

• Licences cancelled from 2014 : 78
• Licences cancelled from Feb.23 to Dec.23 : 18
• Licences cancelled from Feb.2024 to July 2024 : 10

Recently on 4th July 2024 Licence of Banaras Mercantile Co Op Bank has been cancelled. Such actions would be useful for the Banks which are operating efficiently to protect their image. Such actions also help in cautioning banks to be more vigilant in doing business. It is seen that the Reserve Bank of India has sharpened its policy as a regulator. RBI has also ensured that where ever needed to educate the Banks and to help them stay within the norms and work efficiently.

Prompt Corrective Action, which was introduced for erring banks, will be applicable to Urban Cooperative Banks from 2025. The actions under this include a deeper Audit of all aspects, Preparation of Action Plan in consultation with RBI, Education of Directors, provision of removing CEO or Senior Officer if felt necessary, restrictions on raising Capital, restriction on expenditure etc. Reserve Bank of India has sharpened its role as an inspecting and auditing authority. Where ever needed the RBI will provide guidance and will educate the Directors before taking strict action.

In short, Reserve Bank of India will have its involvement in the Banking operations as well administration of the Bank also. RBI will have direction interaction with the Directors and concerned officers of the Bank. RBI can have surprise and deeper inspection whenever it feels essential. Now Reserve Bank of India officers are periodically visiting banks and examining the working. They are making on the spot suggestions for making needed change in the working.

As the restrictions from RBI became stringent, the events of irregularities by the Banks have almost stopped. With RBI, the State and Central Government also have become more aware and alert about the cooperative sector. It has been observed that instead of just reprimanding there is an approach of understanding the problems and help. It is seen that the need and the unusefulness of Cooperative Bank has been realized by all the regulators. Therefore, there would be more conducive ambience for the progress and growth of this sector.

Important events of the Reporting Year

1)During a conference of Urban Co Op. Banks, held in Mumbai Adv. Shri Subhash Mohite and CA Shri Janardan Ranadive had direct dialogue with the Governor RBI. The problems of Cooperative Banks, the present position etc. was discussed and told to the Governor.

2)An Umbrella Organisation has been established for all Urban Cooperative Banks in India,. This National Urban Co Op. Finance and Development Corporation was inaugurated at Delhi, for which Adv. Subhash Mohite and myself were present.

3) During the year we have been honored with an Award, Banko Blue Ribbon Award 2023. Bank has also been awarded 'Top Mobile Initiative for Consumer' award by ICONIC LEADER.

4) I am happy to inform that our Bank has been awarded Best Multistate Bank Award by NAFCUB and B2B . This award was presented to our Bank in 8th All India Urban Banks Conference held in Mumbai.

5)Looking to the performance of the bank, the working and the efficiency of the bank, our Bank was invited to participate in a panel discussion arranged and telecast by Lokshahi TV Chanel. Adv. Subhash Mohite and CA Janardan Ranadive participated in the discussion. The panel comprised experts from the field of cooperative sector.

6) On 8th March, being World Women Day, Bank had arranged various programmes simultaneously at Branches in Pune and around and also at Belgavi and Thane.. Women from Government service, Police Officers, Business women, working women, house hold etc. were felicitated appropriately at all the branches.

7) Bank has launched its modern Mobile App, through which customers would will get more and convenient service. This was a gift to the customers on the occasion of Rakshabandhan.

8) 3Besides this Bank has distributed Tents to Warkari Dindis, education aids and computers to the schools.

9)As suggested by RBI and as it has become mandatory, we have constituted Customer Service Committees at all the Branches. The suggestions and complaints received from customers would be considered by the Committee and shall provide feed back to the Board. This will be useful in making suitable changes in our policies and working. The meetings of these committees are held regularly.

10) Bank is always careful about the convenience of its customers, their benefit and the service. With this mind set we have shifted our Talegaon Dabhade ( Station) Branch in our own premises on a prominent location in a spacious and well equipped premises. Bank will be shortly shifting its Belgavi Branch in our own premises.

Cyber Security

We have been reading news of cyber crimes and the great financial loss to the customer. This has increased since the Cashless transactions have increased. For ensuring security of our customers we have been giving timely alerts to our customers through SMS etc. We have established a Customer Care system and we have advised our customers to be in touch with this cell immediately if something seems to be doubtful and fishy. We continuously educate our customers through our Website. Our mobile app is secured. However, we have a three step security to see that the customer is not cheated by Cyber criminal. For providing adequate security to the customers, the expenditure on Technology has been on the increase.

Establishment of Special Compliance Department

To ensure that no bank lands into trouble from one reason or the other, the RBI hasdecided to provide more attention on supervision of the working. To ensure that the working of the Bank is as per the guidelines of the RBI and customer care is being ensured, we have established a department called Special Compliance Department. This department will ensure that all these guidelines and parameters are adhered to. RBI in the past was taking action under PAC. However, now the RBI has decided to have interaction with Directors, CEOs etc. on the problem areas and to guide them for avoidance of misdeeds or financial irregularities.

Employee wage revision

It is the thinking of the Bank that employees, customers and the directors of the Bank are members of an extended family. Interests and welfare of all these constituents is interdependent. Wage revision agreement was completed on 31st Jan.2024 So far an amount of Rs.4.77 crore has been paid to the employees under this agreement. Following are the highlights of the agreement that has been entered between the employee organization and the Bank management:

1. Increase in salary from Rs.2200 to Rs.11800 per month depending upon the post, service seniroty etc.
2. Loans at concessional interest rates
3. Housing Loan at just 5% p.a.
4. Provision of keeping lien on service during the period of education abroad
5. Health Insurance for Family for Rs.3.00 lakh.
6. Personal and accident insurance cover for Rs.10 lakh
7. Full Body check of the employees at the cost of the Bank has also been completed.

Bank regularly organizes training programmes for keeping the employees updated on various aspects of banking and management. Bank has always opened opportunities of promotions to reward the deserving and efficient staff. The wage revision discussion took place in pleasing atmosphere. All the employees have expressed happiness over the revision and other provisions. Slimilarly we shall be considering opening of branches at other developing centres.

Future plans

Suburb of Sambhajinagar and Baramati are two of the fast developing centers. Both these centers have potential for industrial and commercial advances. We have received permission from Reserve Bank of India . We have finalized premises for these branches and during the current financial year these branches will be in service of people. Technology is going to bring a number of challenges before us. It is therefore necessary that we keep ourselves updated. Developing Digital technology, need for a Corporate Governance, lack of knowledge and skill of the employees, conducive atmosphere for banking etc. are likely to put financial burden on Cooperative banks.

Presently we have UPI, Q R Code, ATM, RTGS, NEFT, IMPS, E statement etc. During this financial year we are going to launch UPI Lite ( Unified Payment Interface) system and introducing other services that are presently available at big banks. We are also introducing RuPay Contactless ATM Card We are making the facility of opening Fixed Deposit Account through their mobile, so that the customers will not have to come to the Bank for this. We are planning to use Cloud system to store ever increasing data of the Bank. I am pleased to inform you that shortly we will be allotted IFSC Code and shall get direct membership. Work of Interior etc. of our Head Office building is nearing completion. We shall be shifting our Head Office in the New Building in near future.

Our Bank has been consistently paying Dividend. This year our financial position is better so it has been proposed to give dividend of 12.5%. I am sure, the members will approve this proposal.

Thanks and acknowledgements

During the period under report Bank received valuable cooperation, assistance and guidance from a number of institutions and persons. This includes Reserve Bank of India, Finance Ministry, Maharashtra Government, NAFCUB, NCUI, Cooperative Commissioner, various experts, Law experts, Auditors, Statutory Auditors SUNSVG Associates, Shri S.D.Ghodekar who designed the Annual Report, various service providers and wel wishers of the Bank. We have always received such cooperation from all of them. I sincerely thank all them.

All my colleagues on Board, my colleagues from Management Committee have through out provided me with needed cooperation and guidance. I am proud that we have been working as a strong team. I thank all officers and employees for their contribution.

I am grateful to all the members of the Bank. I am thankful to them for their encouragement, their suggestions and cooperation.

CA Janardan Ranadive

Chairman