1.

Q.

What is your Bank?  Is it a Cooperative Bank?

A.

The Coastal Local Area Bank Ltd.,  is like any other private sector bank, viz ICICI Bank, Axis Bank, Laxmi Vilas Bank, Karur Vysya  Bank, ING Vysya Bank etc.,

The bank was registered under Companies Act.1956, as per the license issued by the Reserve Bank of India (RBI).  The bank is under the regulatory supervision of the RBI.  RBI conducts annual financial inspection (AFI) every year and ensures proper conduct of the bank operations as per the regulations.

2.

Q.

At what level the RBI has assessed the performance of the Coastal Local Area

Bank Ltd.,?

A.

The Bank’s performance is considered satisfactory.

3.

Q.

A.

The bank has been functioning in 3 districts of Andhra Pradesh. They are Guntur, Krishna and West Godavari. We have 15 branches functioning in these 3 districts. The names of branches, their addresses and phone numbers are furnished in the pamphlet supplied.

We have applied to RBI for licenses to open more branches during 2009-10. The response of RBI is awaited.

4.

Q.

A.

The strength of a bank is judged by certain important parameters and a comparison with other peer banks.

5.

Q.

A.

Coastal local area bank ltd is a strong bank, governed by competent and experienced personnel. The bank is functioning on strong fundamentals, with the board approved policies, systems and procedures, complying with the RBI regulations.  The asset (loan) portfolio is strong and safe with adequate collaterals consisting about 52% gold loans to total credit portfolio and highly satisfactory recovery performance.

The deposits of each individual are insured up to Rs.1.00 lakh, with the Deposit Insurance Corporation (DICGC), which is an extended arm of RBI.

6.

Q.

A.

The details are furnished in the pamphlet supplied.  The bank is offering the highest rates of interest on deposits compared to any other commercial bank operating in these 3 districts.

Further, we are offering 1% interest extra for senior citizens (60 years age and above) for the term deposits of one year and above. For deposits of less than one year, we are offering 0.50% extra.

7.

Q.

A.

There is a difference in overall functioning of the Cooperative Banks and Commercial Banks.  The commercial banks are under the total control and regulation of RBI and there are restrictions on lending rates of certain segments like priority sector advances.  Keeping in view all the parameters, including statutory reserves (CRR & SLR), the deposit interest rates are fixed, however in tune with the market trend. That is the reason why, the failure of commercial banks under the RBI control is a rarity.

8.

Q.

A.

The interest rates on advances are related to interest paid on deposits, operating cost for the bank, risk perception, overheads and profit.  Further, there is no level field for the public sector banks (PSBs) and private sector banks.  The PSB’s are benefited with major part of low cost deposits and hence their lending rates are low.

Each bank fixes its PLR (Primary lending rate). Our bank’s PLR is 12.50% now.  The PLR of some other private sector banks functioning in our area is around 14% and in one large sized bank it is 16.25%. PLR is the rate of interest at which the bank lends to its important and the best customers. In that way, the rate of interest at which we are lending is highly reasonable.

9.

Q.

A.

 A. Deposits :

 B.  Advances:

10.

Q.

A.

The cost of operations of the bank is continuously going up.  The salaries, telephone charges, conveyance, printing and stationery, premises rent etc., are going up year after year.  The service charges of our bank are not revised for the last about 10 years.

We made an attempt to cost the operations of various products and services.  Further, we compared the service charges being levied by other banks.  We finalized the service charges in such a way that the levy is comparatively lesser than other banks.

The so called less rates offered by some banks if any , have a tag attached to the minimum level balances  to be maintained by the customers in their Current /SB a/cs. Such a provision is available with our bank also.

11.

Q.

A.

We are lending 46.93% of our total advances to priority sector, against prescribed 40% (Agriculture & allied activities 30.85% against prescribed 18%, weaker sections 24.11% against prescribed 10%, women 11.28% against prescribed 5% of total advances), as at 31.12.2009.

12.

Q.

A.

The bank is supported by “Core Banking Solutions” (CBS).  All the 15 branches are net worked and we are able to provide on-line banking facility.  We are having arrangements with a private bank (Axis Bank) and on line transfer is possible to anywhere in India and abroad under various funds transfer methods like RTGS, NEFT, SWIFT etc.,

13.

Q.

A.

We are in the process of planning for installation of ATMs. It may take some more time. However, we may add here to say that all our branches have split business hours (i.e.10.00 AM to 2.00 PM and 4PM.To 7.00 PM on all working days. On Saturdays the timings are restricted). Customers may make use of split business hours for convenience banking. We do not have plans for issuing Debit/Credit cards in the immediate future.

14.

Q.

A.

The bank is totally manned by officers only.  The staff is empowered with adequate knowledge and there may not be any situation for a grievance. However, each branch is headed by a Manager, who is an experienced officer.  He is available at the branch throughout the business hours for sorting out any grievance of customers.  If the customer is not satisfied with the support or a reply from the branch manager, he/she can approach the appellate authority i.e. Chief General Manager, whose address is displayed in each branch.

15.

Q.

A.

As on 31^st December 2009, the bank has 122 employees working at its corporate office and 15 branches. We have plans to go in for recruitment through a process, subject to getting licenses from RBI for opening of new branches.

16.

Q.

A.

Yes. Our Bank is earning profit every year, since inception.  The profit for the year ending 2008-09 was Rs.243.94 Lakhs.  We are sure to earn more profit during the current year.

17.

Q.

A.

Yes. We extend loans to all sectors, subject to viability and compliance to standards fixed by the Bank.  Credit policy is in place and all the proposals complying with the standards are considered for sanction.

18.

Q.

A.

The Bank earned a good name for personalized services to its customers. The important aspect is that the Bank is investing (lending) all its resources (deposits + other available funds) in the 3 districts where it is operating. The Bank stands for “OUR AREA” , “OUR CLIENTELE”, “OUR BANK”.

FIRST IN SERVICE                   &                  BEST IN TRUST