Brief History of the Bank: The  Jammu Central Co-operative  Bank Limited was registered in the year 1914 as a District Central Co-operative Bank with its area of operation confined to Jammu District only. However, with the partition of the Country some of the other  similar type of Central Co-operative Banks were merged with the Jammu Central Co-operative Bank  Limited Jammu. These Banks were of Districts Rajouri, Poonch, Doda, Kathua, Udhampur and thus the area of operation of the bank got extended to whole of the  Jammu region comprising of Six districts Viz. Jammu, Kathua, Udhampur,Doda, Rajouri and Poonch.There are 63 Branches and 3 Extension Counters of the Bank. Formerly, the Bank was having a nominated Board but  after  3rd September 2001 there is  duly elected  Board of Directors of the Bank.

Financial Indicators

(Amt. in Lakhs)

Kissan Credit Cards: Kissan Credit Cards Scheme was operationalized  during 99/2000 in accordance with NABARD's guidelines which improved the quality of Institutional Credit Delivery for agricultural  purposes. Bank have covered a significant  proportion of borrowers under the Kissan Credit Card Scheme which proved an innovative  attempt at  further refining the crop absorption capacity of Primary Agricultural Societies. Bank have so far issued 17710 Cards with credit facility of Rs.1732.21 lakhs, the year-wise  break-up is as under:

Y e a r	Target of KCC	KCC Issued	Amount Sanctioned
1998-99	0	152	30.58
1999-00	650	304	41.45
2000-01	11000	7880	728.11
2001-02	57500	4696	431.25
2002-03	25000	2208	212.90
2003-04	5000	721	119.52
2004-05	5000	1749	168.40

Affiliated Societies: There are 1273 societies  affiliated with the bank as on 31st March 2005, with district-wise  break-up  as under:

S.No.	District	Type of  Societies
		Primary	Secondary	Others	Total
1	Jammu	456	9	112	577
2	Kathua	113	1	16	130
3	Udhampur	223	3	7	233
4	Rajouri	88	2	6	96
5	Poonch	24	1	6	31
6	Doda	194	2	10	206
	Total :-	1098	18	157	1273

Board of Management: The Board is the Governing Body of the Bank to whom the management of the affairs of the Bank is entrusted. The strength  of the elected  members of the Board does not exceed  sixteen members.

The Board is elected as follow:

• Members representing Individual Share Holders not exceeding one.
• Members representing the share holding Primary Agri. Credit Societies not exceeding twelve, elected @ two from each district by his class of member societies from his District.
• Members representing share holding non-agriculture Credit Societies not exceeding one.
• Members representing share holding Marketing Societies not exceeding one.
• Members representing other share holding societies not falling in any of the above category not exceeding one.

Of the above two seats are reserved for the members who belong to the Scheduled Castes and other Backward classes  and one for a women representative. If no such persons are elected the elected members  may coopt  the required number of persons entitled to such representation with the approval of the Registrar.

Chief  Executive is the Ex-Office Member Secretary  of the Board.

Besides Govt. nominees as may be nominated  in accordance with the provision of Act, one seat each shall be reserved for the nominees of J&K State Coop. Bank and National Coop. Development Corporation.

The term of  office of all the elected  members  of the Board is three years from the date of election. Should the election  be not conducted by the Competent  Authority  before the expiry of the term, the term of the Board shall be deemed to have been extended until such time within which the Competent Authority as prescribed under the Act and Rules, gets the elections conducted.

Revival of PACS: Based on target to identify  one society  per block as a Model Society, 43 Societies are identified as per district-wise  detail appended hereunder :

S.No.	District	No. of  Societies  identified  as Modal Societies
1	Jammu	11
2	Kathua	8
3	Udhampur	11
4	Doda	4
5	Rajouri	6
6	Poonch	3
	Total :-	43

District Managers have been directed to focus their attention particularly towards  these societies for affecting recoveries  and subsequently  providing loans for seasonal agricultural  operations and other allied  activities.Against 43 identified societies, 29 societies  have already been  made  eligible. Efforts are being made to revive  other societies also.

Directions stand issued to all the District Managers for early revival of these societies and also to enrol more and more families as a member of the society, to bring them under Cooperative fold. Based on guidelines  received from Govt. of India, Bank has targeted to double the flow of agriculture credit by the  end of March 2007.

Development Action Plan (DAP) Strategies thereof: A.       Bank  attaches  considerable importance to Development Action Plan  in an attempt to improve the viability.The Development Action Plan is prepared, taking into account the strengths and weaknesses of the Bank.In the process, the efforts  are made to deal with the problems and exploit the business potentials. The different phases in DAPs are:

• Diagnosis of problem
• Problem definition
• Potential analysis
• Action Planning
• Implementation
• Monitoring and Review
• Refinement of plan

Future Outlook and Strategies: Looking at the Financial indicators (as given  under para 03 above) and the working  of the Bank,  a specific course of action is planned for:

• Reduction in cost of funds
• Reduction in risk cost
• Reduction in transaction cost
• Increase in yield

Reduction in Cost of Funds: Aggregate deposits of the Jammu Central Coop. Bank Ltd, are growing at all times though the rate of growth during certain periods in the past was more and during certain other periods it was less.But the concern of our bank is not growth rate perse but the  changing composition  of deposits portfolio. The volume of time deposits was growing  at a faster rate  then the demand deposits. One of the implications - the most significant  one - is higher outgo in the form of interest on these  deposits. This alongwith the decrease in the lending rates, squeezes  the margin available.

To reduce the cost of funds, there is no other alternative but to alter the  mix of deposits.The Bank has to mobilise more and more of savings and current  account deposits.During the last two years Bank's Board has taken  a policy decision not to  encourage  term deposits under reinvestment plan(under Money Multiple Deposit Scheme).Besides  ^1/2% extra interest incentive which the Bank was providing to its clients  for the last many  years stands withdrawn.Both these  decisions checked the growth of Term Deposits.Whereas percentage  of Term deposits (high cost deposits) was 66.85%  as on 31^st March 2002, it came down to 56.88%  as on 31^st March 2005.This changed  composition  of deposit  portfolio  decreased the interest cost  of deposits as Rs.5.64 per hundred  rupees  during 2004-05 as against  Rs.7.21 per hundred  rupees during 2001-02.

Bank  has planned to further  bring down  the cost of deposits  at Rs.4.88 per hundred rupees by the end  of 31^st March 2007 as against Rs.5.64 per hundred  rupees as on 31^st March 2005.

Reduction in Transaction/Risk Cost: A major part of transaction cost is related to payments to be made to staff. It may not be possible  to reduce these costs in absolute terms.Some of the costs like Stationery, Telephones, Travelling expenditure may be brought  down in absolute terms. But then the reduction  may not be very significant. Bank has to ensure that at least the increased business does not carry proportionate increase in transaction cost.Transaction cost  as a percentage of working funds  would be brought down. In the  Development Action Plan for the year 2005-06 & 2006-07, COM is projected  at Rs.2.33 and Rs.2.03 respectively as against  Rs.2.49 per hundred  rupees ending 31^st March 2005. Keeping in view  the past experience  and freezing  of fresh appointments in the Bank, it would not be difficult  to achieve the target.

Transaction costs have also a relationship with risk cost.To minimise the risk cost in future, the Bank staff is advised to maintain the quality of loan assets, to have sound systems of borrower selection, appraisal, monitoring  and recovery so that  non-performing  assets are reduced  in absolute as well as in percentage terms.

Increase in Yield :

• In view of the stagnant credit  absorption capacity  of Primary Agricultural Co-operative  Societies,  the Bank has to diversify its loan portfolio and to search for high yield loans to increase the proportion of such assets  in the total portfolio. Two possible  courses of action are :-

  • To give  larger loans  by meeting  the credit requirements of customers in full and
  • to build  a loan portfolio  which consists of both long term and short term loans.
• Managerial talent in the JCCB  is more synonymous with deposit mobilisation  capacity instead of "COMPLETE BANKERS" with ability  of  asset liability  management skills.The emerging scenario shall  be changed.The  talent shall be nurtured and  recognised more on the lines of raising  resources for profitable deployment, Training infrastructure  alongwith technology support shall be geared up.
• Recovery of interest  income is  another factor  that affects the yield. Bank shall pay greater  attention towards  monitoring  of regular  payment  of interest by the borrowers.This would be achieved by reducing  the NPAs of the Bank. Process of recovery of JAKFED's  default  is in the pipeline  and likely to be finalised during the current financial year.This would not only reduce the accumulated losses of the bank but recycling of funds( Rs.62.04 Crores) would  further generate interest income for the Bank. In view of this, the Bank is likely to comply with the provision of Section 11(i) of the B.R. Act.1949(AACS) by the end of March 2007.
• Another  area of concern is "judicious cash management and management of funds".Opportunities for earning income are lost by lack of proper  MIS, insufficient  cash handling procedures, ineffective remittance mechanism and irregular monitoring system.By focusing  attention on improving  the funds management system bank would be in a position to maximise the returns from investments with negligible incremental  transaction cost.

Audit Classification/ NABARD Classification: Bank is continuously being  classified  under "D" Category  by the Audit Team constituted by the  Cooperative Department. Reasons are high  level of overdues and accumulated losses (mainly due  to JAKFED's  default as not only the level of overdues  increased but non recycling  of these funds also affected the further increase in interest income of the Bank, resulting into increase in accumulated losses)

Human Resource Development Programmes: Key inputs which  would make Bank's planning as successful are those pertaining to human resources  and these are being taken care of. Taking stock of the volume and quality of the human resources available, the future  requirements  of the Bank in accordance with the profile of  business  anticipated in the next few years  shall be  planned for. Training and equipping  the staff  with relevant  expertise for future  shall be an integral part of the plan.

Further, the plan for grooming the second and  third  lines of  management  to discharge their functions independently  shall be part of the H.R.D. initiatives.The  staffing  norms shall be followed  based on profitability and viability considerations.Any move, in future, to augment staff strength  shall be first vetted through  viability considerations.

Computerisation: Bank in 1997-98 had set up its first fully computerised  branch in Jammu in its new Central Office Complex with a concept of  "Serving one to one basis". Uptill now 9 branches in Jammu City, besides  all the District Offices  stands already computerised. Bank intends to have all its District Head Quarter branches fully computerised.

Ensuring continued Public confidence: Bank had been in the past  taking steps  to improve public confidence  and in 2003-04, set up its first ATM at Parade Branch  in collaboration with Bank of Punjab Ltd.Another ATM has been installed at Rail Head Branch  during 2004-05.Clients of the Bank  having ATM  Card, can  now operate through ATMs  of Bank of Punjab Ltd, all over India. Bank intends  to open more such ATMs  in other City Branches.

Vision   2005-2010: Any vision statement refers to a complete  set of dispositions that evolve entire trend  of futuristic view. Vision  is a combination of vista (V) of any imaginary (I) situation  based on impulses, synthesised and synergised  (S) with intuition  (I), optimism (O) and  novel (N) ideas for FUTURE.

The life of every individual is guided by the vision  he has for the future  and the mission  for him is to achieve the same. It is more pertinent  for an institution  as well as  any structure to have a clearly defined vision and determined mission to reach the goal.

Vision       

The Jammu Central Co-operative Bank dedicates itself  to all round of growth of PACS by providing  required credit to them. It also  swears  to serve the general public  by extending improved banking services and enhanced credit dispersal better than any other  banking channel.

Mission

The Jammu Central Co-operative  Bank shall have the visionary  look and missionary zeal to achieve its awarded  objectives. The Bank shall fine tune its functioning  to challenge the  competitive on  slaught from the commercial Banks and  Regional Rural Banks. For developing  a mission, there shall be a two step process :-

Corporate Mission

As a corporate process, the uniqueness and distinct  culture of the Jammu Central Co-operative Bank is our  experience specialisation in the field of  agricultural credit and vast clientele base.Therefore, as a corporate mission, our focus would be agricultural finance and needs of the rural people. In light  of above, the corporate mission  would be to double the flow of Agriculture Credit  during the next three years.

Organisation Mission

The organisational mission would be  to inculcate sense of belongingness  by bringing  professionalisation in true sense to introduce and upgrade technology based skill with human face and strengthen its resource base by  broadening its customer base.