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Chairman's Address at the 88th Annual General Meeting of the Bank on 29th September 2015.

Dear Shareholders,

I deem it a privilege to welcome you all to the 88th Annual General Meeting of Dhanlaxmi Bank Limited for the financial year 2014-15 being held here today. The Directors’ Report and the Audited Financial Statements for the year ended 31st March 2015 are already with you and with your permission, I take them as read. At the outset, I thank all of you for your esteemed presence, continued trust and unwavering patronage extended to the Bank all these years which enabled the Bank to progress over the years.

Before I profile the performance of the Bank, I would like to touch upon the macro environment in which your Bank performed during the fiscal year 2014-15.

Economic and Banking Scenario:

Economic recovery in major global economies was slow and there are no signs of respite, on account of large scale quantitative easing (QE). The fallout of Greek crisis, uncertainty over the rate increase by the US Federal Reserve, especially the Chinese Stock market crash, the devaluation of Yuan has created volatility in stock markets and depreciation of Rupee.

However, the Indian economy showed improvement over the previous year. As per the data released by central statistical organization (CSO), India’s gross value added (GVA) at basic prices grew by 7.2% for FY 2014-2015 as against 6.6% in the previous year. The inflation rates both whole sale and retail have moderated from their peaks and CPI based inflation was at 5.2% in March 2015 and WPI based inflation was at -2.33%.

Agricultural activity was adversely affected by unseasonal rains and hailstorm in North India during March 2015, scaling down the estimated 94 lakh hectares of area sown under the rabi crop. The deterioration in export performance affected economies across Asia as global demand fell and the fall in commodity prices impacted the terms of trade for commodity exporters. Gold imports spiked in the month of March and remained elevated in April owing to festival demand and regulatory relaxations.

India’s relatively stronger macroeconomic fundamentals in terms of growth, inflation, current account and fiscal deficits provide a reasonable degree of resilience to Indian financial system in the event of spillover effects from external factors.

The Indian economy is now on the threshold of a major transformation with expectations of policy initiatives being implemented. Positive business sentiments, improved consumer confidence and more controlled inflation should help boost the economic growth. Higher spending on infrastructure, speedy implementation of projects and continuation of reforms will provide further trigger to growth. All this should translate into a healthy growth potential for banking sector also.

Performance of the Bank:

Major performance highlights for the financial year 31 st March 2015 are:

  • Total Business of the Bank crossed Rs. 20,500 Cr.
  • The total Deposits of the Bank increased to Rs. 12,382 Cr.
  • The total Advances stood at Rs. 8,122 Cr.
  • CASA as a percentage to total deposits stood at 24.34%.
  • The net interest income (NII) stood at Rs. 298.84 Cr. and Net Interest Margin (NIM) increased from 2.27% to 2.37%.
  • The operating profit increased by Rs. 10.52 Cr. from Rs. 6.06 Cr. and stood at Rs. 16.58 Cr.
  • Cost of deposits decreased from 8.13% to 7.87%.
  • However, on account of higher provisioning requirements, the net loss stood at Rs. 241.47 Cr.
  • Capital Adequacy Ratio (CRAR) stood at 9.71% (Basel II) and 9.59% (Basel III).

Human resources policies and practices of your Bank focus on attracting, motivating and retaining skilled manpower. Training and development assumed significant importance. The Bank’s Staff Training College identifies the skill gap of the personnel and trains them for qualitative improvement. Your Bank has effectively leveraged technology and introduced several variants of traditional products and new e-based services, tailor made to the diversified needs of the customers.

The Bank has put in place risk management architecture and practices that is overseen by a Committee of Directors. Your Bank has in place a robust risk management structure which proactively identifies the risk faced by the Bank and helps in mitigating it while maintaining proper tradeoff between risk and return thereby maximizing the shareholder value.


The Bank’s CSR policy strictly conforms to the guidelines of RBI and Ministry of Corporate Affairs.

The Bank strengthened its endeavors in this area during the year. It continued its association with “Walkers Park” in Thrissur. In alliance with Thrissur Management Association, it had initiated in the year 2010 scholarship programs for deserving MBA students seeking financial assistance. During the year 2014-15, the Bank gave scholarship to two MBA students.

Customer Service:

The Bank has taken several initiatives to become customer centric by introducing various customer friendly products and services. Customers’ enquires and complaints are redressed quickly and efficiently. The code of commitment to customers issued by the Banking Codes and Standards Board of India (BCSBI) is available in Bank’s website. To assess the quality of customer service rendered by the branches a customer satisfaction survey form is available in Bank’s website. Customers can also e-mail their complaints/suggestions.

Goals for FY 2015 - 2016:

Your Bank’s long standing commitment of financial soundness, long term customer relationships and proactive management is as important today as ever before. Going forward, your Bank continues with its thrust on growth and quality. The Bank would try to protect and further improve the current levels of its key financials like net interest margin, return on assets, earnings per share, asset quality etc through dedicated focus on low-cost deposit mobilization, improvement in non-interest income, efficient pricing of deposits and loans and effective credit monitoring. I may add that the Board of your Bank as also its specific committees has been quiet active in taking all possible initiatives in bringing down the level of non-performing assets.


The Board of Directors places on record its gratitude to the Government of India, Reserve Bank of India, State Governments, Securities and Exchange Board of India and other regulatory bodies including stock exchanges where the Bank’s shares are listed for their support and guidance. The Board also places on record its appreciation for the valuable services rendered by M/s Sagar & Associates, Chartered Accountants, Statutory Auditors during the year under review. The Board further places on record its gratitude to the Bank’s customers, shareholders, other stakeholders and well wishers for their valued patronage. The single most important piller of any institution is its personnel, more so in the case of a service entity like a Bank. The Board expresses its sincere appreciation for the dedicated services rendered by officers and employees of the Bank at all levels.


Before I conclude, I would like to assure you, that your Bank has put in place appropriate plans and strategies to bring about business growth with quality and profitability. I seek your continued support and patronage to place your Bank in the next higher orbit of excellence.

Thank you, Ladies and Gentlemen, for your time and attention

September 29,2015



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