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VOLUME NO. 4 (2013), ISSUE N O. 01 (J ANUARY) ISSN 0976-2183

CONTENTS
Sr. Page
No. TITLE & NAME OF THE AUTHOR (S) No.
1. DIFFERENCE IN THE BUSINESS STRATEGIES ADOPTED BY BANKS: A REVIEW OF BANKS IN THE UAE 1
DR. KAUP MOHAMED
2. CUSTOMER’S CRITERIA IN SELECTING A BANK: A CASE OF PAKISTANI BANKING INDUSTRY 4
DR. ANSAR ALI RAJPUT, SABIR HUSSAIN KALHORO & SAIMA AMMAR
3. THE RELATIONSHIP BETWEEN THE FOREIGN DIRECT INVESTMENT AND BANKING INDUSTRY 9
MEHDI BEHNAME & MOHAMMAD JAVAD RAZMI
4. IMPORTANCE AND IMPACT OF FOREIGN DIRECT INVESTMENTS IN GCC COUNTRIES AND ITS INWARD FLOW 12
GEEVARGHESE PHILIP MALAYIL & ARINDAM BANERJEE
5. ISLAMIC BANKING IN INDIA: DEVELOPMENTS, PROSPECTS AND CHALLENGES 24
MANZAR ALI KHAN & NAZIMAH HUSSIN
6. ETHICS AND JOURNALISM EDUCATION IN NIGERIA 29
DR. IFEDAYO DARAMOLA & IBUKUN AKINSULI
7. DIVERSIFICATION AS A BUSINESS GROWTH AND SUSTAINABILITY STRATEGY IN GAINING COMPETITIVE ADVANTAGE 34
ESTHER WANJIRU MAINA
8. THE IMPACT OF COMPLIANCE WITH INFORMATION DISCLOSURE IN FINANCIAL STATEMENTS ON TOTAL ASSETS, PROFITABILITY AND 39
EARNINGS PER SHARES OF QUOTED COMPANIES IN NIGERIA
SAMUEL IYIOLA KEHINDE OLUWATOYIN & UMOGBAI, MONICA E.
9. FERTILITY DECISIONS OF HOUSEHOLDS IN RESPONSE TO ENVIRONMENTAL GOODS SCARCITY: THE CASE OF SEKOTA DISTRICT, WAG 51
HIMRA ADMINISTRATE ZONE OF THE AMHARA REGION, ETHIOPIA
ZEWDU BERHANIE
10. INVESTMENT POLICY OF COMMERCIAL BANKS IN INDIA 62
DR. BHAVET, PRIYA JINDAL & DR. SAMBHAV GARG
11. IS THERE A WAY OUT? (A CASE STUDY ON DEBT TRAP) 68
DR. K. SANTI SWARUP
12. ANALYSIS OF CAPITAL ADEQUACY OF PRIVATE SECTOR INDIAN BANKS 71
SULTAN SINGH, MOHINA & SAHILA CHOUDHRY
13. CHANGING PARADIGMS OF INSURANCE COMPANIES - A STUDY 75
P.MANIVANNAN
14. A STUDY ON THE IMPORTANCE OF SOFT SKILLS AND POSITIVE ATTITUDE AS PERCEIVED BY INDUSTRY WITH SPECIFIC REFERENCE TO 78
FRESH ENGINEERS
B R VENKATESH
15. PROSPECTS AND CHALLENGES OF WOMEN ENTREPRENEURSHIP WITH SPECIFIC REFERENCE TO DALITS 86
DR. ANNAPOORANI & P.DEVI BHUVANESHWARI
16. PROBLEMS OF RURAL MSMEs: A STUDY IN THENI DISTRICT 90
DR. J.MARY SUGANTHI BAI & DR. R.GUNASUNDRADEVI
17. THE DEFINING MOMENTS OF SOCIAL ENTREPRENEURSHIP 95
L. JIBON KUMAR SHARMA & MEMCHA LOITONGBAM
18. DEVELOPMENT AND VALIDATION OF FINANCIAL LITERACY SCALE 99
S.SUGANYA, DR. S. SAKTHIVELRANI & K.DURAI
19. THE ROLE OF MICROFINANCE IN THE DEVELOPMENT OF COTTAGE & SMALL SCALE INDUSTRIES IN NORTH EASTERN REGION OF INDIA 105
DR. HARSH VARDHAN JHAMB & MUSHTAQ MOHMAD SOFI
20. EXCELLENT PRACTICES OF EXPATRIATE RELATIONSHIP MANAGEMENT (ERM) IN INFORMATION TECHNOLOGY ENABLED SERVICE SECTOR 113
RAGHAVENDRA A.N. & DR. NIJAGUNA G.
21. THE ROLE OF MEDIA AGENCY IN ADVERTISING INDUSTRY 119
NEHA SULTANIA & G.TEJASVINI
22. LIQUIDITY, SOLVENCY AND PROFITABILITY ANALYSIS OF MANUFACTURING INDUSTRIES: A STUDY WITH REFERENCE SELECTED 123
MANUFACTURING INDUSTRIES IN INDIA
KUSHALAPPA. S & REKHA SHETTY
23. A STUDY ON NPA MANAGEMENT IN INDIAN BANKING INDUSTRY 128
DR. SAMBHAV GARG, PRIYA JINDAL & DR. BHAVET
24. A HUMAN RESOURCE DOWNGRADING - JOB HOPPING 133
DR. M. JANARTHANAN PILLAI & R.V.NAVEENAN
25. WORK LIFE BALANCE: AN OVERVIEW OF INDIAN COMPANIES 138
DR. KARAMVIR SINGH SHEOKAND & PRIYANKA
26. ORGANIZED RETAIL SECTOR IN INDIA – OPPORTUNITIES AND CHALLENGES IN PRESENT ASPECTS 144
DR. RAGHAVENDRA DWIVEDI & RAM KUMAR
27. AN EMPIRICAL EXAMINATION OF PERFORMANCE MANAGEMENT ON EMPLOYEE RETENTION 148
L.R.K. KRISHNAN, SUDHIR WARIER & KETAN KANAUJIA
28. AN EMPIRICAL STUDY OF EFFECTIVENESS OF SALES PROMOTION ACTIVITIES IN A BANK 157
ANKITA SRIVASTAVA & NIRAJ KISHORE CHIMOTE
29. A STUDY ON OCCUPATIONAL HEALTH HAZARDS AMONG WOMEN BEEDI-WORKERS OF MURSHIDABAD DISTRICT IN WEST BENGAL 163
CHANDRA KANTA DAS
30. A PERCEPTUAL STUDY ON BUYING BEHAVIOR OF CUSTOMERS TOWARDS READYMADE GARMENTS 167
IRSHAD AHMAD BHAT
REQUEST FOR FEEDBACK 172
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VOLUME NO. 4 (2013), ISSUE N O. 01 (J ANUARY) ISSN 0976-2183

CHIEF PATRON
PROF. K. K. AGGARWAL
Chancellor, Lingaya’s University, Delhi
Founder Vice-Chancellor, Guru Gobind Singh Indraprastha University, Delhi
Ex. Pro Vice-Chancellor, Guru Jambheshwar University, Hisar

FOUNDER PATRON
LATE SH. RAM BHAJAN AGGARWAL
Former State Minister for Home & Tourism, Government of Haryana
Former Vice-President, Dadri Education Society, Charkhi Dadri
Former President, Chinar Syntex Ltd. (Textile Mills), Bhiwani

CO-
CO-ORDINATOR
DR. SAMBHAV GARG
Faculty, M. M. Institute of Management, MaharishiMarkandeshwarUniversity, Mullana, Ambala, Haryana

ADVISORS
DR. PRIYA RANJAN TRIVEDI
Chancellor, The Global Open University, Nagaland
PROF. M. S. SENAM RAJU
Director A. C. D., School of Management Studies, I.G.N.O.U., New Delhi
PROF. M. N. SHARMA
Chairman, M.B.A., HaryanaCollege of Technology & Management, Kaithal
PROF. S. L. MAHANDRU
Principal (Retd.), MaharajaAgrasenCollege, Jagadhri

EDITOR
PROF. R. K. SHARMA
Professor, Bharti Vidyapeeth University Institute of Management & Research, New Delhi

CO-
CO-EDITOR
DR. BHAVET
Faculty, M. M. Institute of Management, MaharishiMarkandeshwarUniversity, Mullana, Ambala, Haryana

EDITORIAL ADVISORY BOARD

DR. RAJESH MODI
Faculty, YanbuIndustrialCollege, Kingdom of Saudi Arabia
PROF. SANJIV MITTAL
UniversitySchool of Management Studies, Guru Gobind Singh I. P. University, Delhi
PROF. ANIL K. SAINI
Chairperson (CRC), Guru Gobind Singh I. P. University, Delhi

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DR. SAMBHAVNA
Faculty, I.I.T.M., Delhi
DR. MOHENDER KUMAR GUPTA
Associate Professor, P.J.L.N.GovernmentCollege, Faridabad
DR. SHIVAKUMAR DEENE
Asst. Professor, Dept. of Commerce, School of Business Studies, Central University of Karnataka, Gulbarga

ASSOCIATE EDITORS
PROF. NAWAB ALI KHAN
Department of Commerce, Aligarh Muslim University, Aligarh, U.P.
PROF. ABHAY BANSAL
Head, Department of Information Technology, Amity School of Engineering & Technology, Amity
University, Noida
PROF. V. SELVAM
SSL, VIT University, Vellore
PROF. N. SUNDARAM
VITUniversity, Vellore
DR. PARDEEP AHLAWAT
Associate Professor, Institute of Management Studies & Research, MaharshiDayanandUniversity, Rohtak
DR. S. TABASSUM SULTANA
Associate Professor, Department of Business Management, Matrusri Institute of P.G. Studies, Hyderabad

TECHNICAL ADVISOR
AMITA
Faculty, Government M. S., Mohali

FINANCIAL ADVISORS
DICKIN GOYAL
Advocate & Tax Adviser, Panchkula
NEENA
Investment Consultant, Chambaghat, Solan, Himachal Pradesh

LEGAL ADVISORS
JITENDER S. CHAHAL
Advocate, Punjab & Haryana High Court, Chandigarh U.T.
CHANDER BHUSHAN SHARMA
Advocate & Consultant, District Courts, Yamunanagar at Jagadhri

SUPERINTENDENT
SURENDER KUMAR POONIA

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BOOKS
• Bowersox, Donald J., Closs, David J., (1996), "Logistical Management." Tata McGraw, Hill, New Delhi.
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CONTRIBUTIONS TO BOOKS
• Sharma T., Kwatra, G. (2008) Effectiveness of Social Advertising: A Study of Selected Campaigns, Corporate Social Responsibility, Edited by David Crowther &
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JOURNAL AND OTHER ARTICLES
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Vol. 21, No. 1, pp. 83-104.
CONFERENCE PAPERS
• Garg, Sambhav (2011): "Business Ethics" Paper presented at the Annual International Conference for the All India Management Association, New Delhi, India,
19–22 June.
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• Kumar S. (2011): "Customer Value: A Comparative Study of Rural and Urban Customers," Thesis, Kurukshetra University, Kurukshetra.
ONLINE RESOURCES
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• Garg, Bhavet (2011): Towards a New Natural Gas Policy, Political Weekly, Viewed on January 01, 2012 http://epw.in/user/viewabstract.jsp

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INVESTMENT POLICY OF COMMERCIAL BANKS IN INDIA

DR. BHAVET
FACULTY
M M INSTITUTE OF MANAGEMENT
MAHARISHI MARKANDESHWAR UNIVERSITY
MULLANA
Email: bhavetgarg@gmail.com
Voice: +91-9896989571

PRIYA JINDAL
FACULTY
DEPARTMENT OF HUMANITIES & SOCIAL SCIENCES
MAHARISHI MARKANDESHWAR UNIVERSITY
MULLANA

DR. SAMBHAV GARG

FACULTY
M M INSTITUTE OF MANAGEMENT
MAHARISHI MARKANDESHWAR UNIVERSITY
MULLANA
Email: jaisiyaramki@gmail.com
Voice: +91-9996009890

ABSTRACT
In the study of the financial institutions, the investment and investment problems will revolve around the concept of managing the surplus financial assets in such
a way, that will lead to the wealth maximization and providing a significant further source of income. Thus the investment is the management of the surplus
recourses in such a way that it works for providing benefits to the supplier of the funds by letting it managed by a third party. However, the investment needs to
be a procedural task. It must follow a definite process, to ensure the formulation of proper investment policy. Banks are disbursing their money as investment in
trade business and industry. Therefore, banks should be following the principle of investment for profit. An investment policy should ensure maximum profit and
minimum Risk. A huge collection and investment policy plays vital role for the economic development of whole economy. The main focus of this study will be
towards the investment practices of the banks. The study suggests the way to the policy makers to improve the management of investment policy and
recommends suggestions to raise the profit.

KEYWORDS
Wealth Maximization, Investment Policy, Risk.

INTRODUCTION

I
nvestment in financial sense is putting the capital in the hands of an expert individual or expert group to maximize the profit. Investment by individuals,
business and government involves a present sacrifice of income to get expected future benefits as a result investment raises economy of nations.
According to William F. Shape, Gordon J. Alexander and Jeffery V. Baily "Investment in its broadest sense means the sacrifice of current dollars for future
dollars. Two different attributes are generally involved time and risk. The sacrifice takes place in the present and its magnitude generally is certain" (Shape
Alexander and Baily, 1998) .Banks accept money as a deposit from public and invest it in form of loan and advances. Financial institutions act as an intermediary
role between the persons who lend and who borrow. Bank pools the scattered funds and mobilizes them in productive sector. Banks came into existence mainly
with the objective of collecting the idle Fund, mobilize them into productive sector and causing an overall economic development. The bankers have the
responsibility of safeguarding the interest and deposited amount of depositors.

STATEMENT OF PROBLEM
In 1991 the policy of Liberalization, Privatization and Globalization was adopted by the government of India. Due to this policy, now a day’s commercial bank,
developments bank and financial companies are operating with high competition. The fast growth of such organizations has made pro-rata increment in
collecting deposit and their investment. These institutions collected a huge amount from public but couldn't allocate it in new investment sectors. It impacted
the faith of the investors and also impacted the market value of the shares negatively. Though several commercial banks have been established however, they
failed to ensure satisfactory returns.
Generally after providing the loan there is no practice by the banks to find out if the debtor has utilized the loan for the same purpose or not. It is one of the
unhealthiest practices in banking business and such practices have contributed to the piling of unrecovered bank loans. Thus it is necessary that the banks must
formulate a very strong and organized investment policy.

REVIEW OF LITERATURE
Sharma, M.P. & Bhatt, M.P. (2002), in their article “Priority receiver sector” has present “The commercial banks should take care of board national interest &
they showed not confine their lending activities only to commercial area providing quick interest if some proportion could be directed to the area conclusive to
build economic infrastructures of the country it would create atmosphere conductive to their investment in future. In our society where ignorance & literacy is
in wild scale, it is necessary that the banks search entrepreneurs instead of entrepreneurs searching book. So, they have opinioned that the priority sector
program is a timely & opportunities there by increasing production & the general living standard or rural poor. Shrestha (2004) conducted a study on “Nepal
Rastra Bank Guidelines on Investment policy of commercial banks in Nepal (A case study of Nepal Investment Bank)”. The main findings of the study are:1.Bank
is in good position to meet the daily cash requirement as bank has maintained the average cash & bank balance in respect to total deposit.2.The performance of

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NIBL regarding deposit collection granting loan & advance & investment is quite satisfactory but doesn't seem to follow definite policy.3.NIBL has not efficiently
utilized its equity capital hence return on equity is not satisfactory because of lack of sound investment policy for mobilization of its equity capital. Chen Ping,
Yang Hailiang, Yin George (11) (2008) conducted study on”Markowitz's mean-variance asset-liability management with regime switching: A continuous-time
model” This paper analyzed an asset-liability management (ALM) problem under a continuous-time Markov regime-switching model. By adopting the techniques
of Zhou, X.Y., Yin, G. Markowitz's mean variance portfolio selection with regime switching: A continuous-time model. SIAM J., they investigated the feasibility,
obtain the optimal strategy, delineate the efficient frontier, and establish the associated mutual fund theorem.

OBJECTIVES OF THE STUDY

The main objective of the study is to assess the investment policy and strategy followed by the bank with reference to Corporation Bank and Oriental Bank of
Commerce. The main objectives of this study are mentioned below:
1. To analyzes the deposit utilization for five years of Corporation Bank and Oriental Bank of Commerce.
2. To analyzes the financial position of Corporation Bank and Oriental Bank of Commerce in terms of deposit collection and investment procedure.
3. To suggest and recommend on the investment policy of sample banks.

LIMITATION OF THE STUDY

1. This study is mainly concerned to only two banks i.e. Corporation Bank and Oriental Bank of Commerce.
2. The whole study is based on secondary data from the respective banks, internet, article and newspapers.
3. The study is base only on the latest five year data.
4. Lack of sufficient time and resources.
5. In this study only selected tools and techniques have been used.

RESEARCH METHODOLOGY
PERIOD OF STUDY
The Post- reform period of five years (2008-2012) has been taken for analyzing the trend in deposits, investment and loans & advances in banking sector.
SAMPLE SIZE
In context of India, 28 Public Sector Banks are in operation. These twenty eight banks are regarded as population. But, it is not possible to study all data related
with these twenty eight banks. Hence two banks have been taken as sample from the whole population i.e. twenty eight banks. The sample banks are as
follows:-
• Corporation Bank
• Oriental Bank of Commerce
SAMPLING PROCEDURE
The selection procedure of the sample is purposive it is not random. The banks are selected for study on the basis of business per employee as on March
2011.These banks have the highest business per employees among all other banks.
SOURCES OF DATA
This study mainly depends on the use of secondary data that consists of annual reports of the concerned banks. However besides the annual reports various
other sources of data have also been used for the purpose of study i.e. plan documents, newspaper, magazine, economic journals and RBI reports etc.
DATA ANALYSIS PROCEDURE
To achieve the objectives of the study, trend analysis of deposit, loan & advances, and investments has been used.

ANALYSIS AND DISCUSSION

TREND ANALYSIS OF TOTAL DEPOSIT OF SELECTED BANK
The trend value of total deposit of Corporation Bank and Oriental Bank is calculated under this section. An effort has been made to forecast for next three years
from 2013 to 2015 on the basis past data of total deposit of Corporation Bank and Oriental Bank of Commerce from March 2008 to March 2012.

TABLE 1: ESTIMATION OF THE DEPOSIT FOR THE YEAR 2013 TO 2015

Years Deposits (Rs. In crore)
Corporation Bank Oriental Bank of Commerce
2008 55424 77857
2009 73984 98369
2010 92734 120258
2011 116748 139054
2012 136142 155965
2013 156266 177370
2014 176686 197060
2015 197106 216750
(Source: Annual reports)
The above table shows the total deposit of the banks is in increasing trend. If other things remain constant the total deposit of Corporation Bank will be
Rs.1,97,106 crore in the FY 2015 and that of Oriental Bank of Commerce will be Rs. 2,16,750 crore.
TREND ANALYSIS OF LOAN AND ADVANCES OF SELECTED BANK
An effort has been made to forecast the amount of loan & advances of Corporation Bank and Oriental Bank of Commerce for the next 3 years from March 2013
to March 2015.
TABLE 2: ESTIMATION OF THE LOAN AND ADVANCES FOR THE YEAR 2013 TO 2015
Years Loan and Advances (Rs. In crore )
Corporation Bank Oriental Bank of Commerce
2008 39186 54566
2009 48512 68500
2010 63203 83489
2011 86851 95908
2012 100469 111978
2013 115916 125558
2014 132007 139781
2015 148097 154004
(Source: Annual reports)

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The above table shows that both the banks have increasing trend of loan and advances. It is forecasted that both of banks will have increasing trend of loans and
advances. The possible capacity of granting loan and advances of Oriental Bank of Commerce seems higher than that of Corporation Bank. Oriental Bank of
Commerce seems to be more successful in the future to earn more profit than that of Corporation Bank because the expected future value of loan & advances of
Oriental Bank of Commerce in the year 2015 is Rs. 1,54,004 crore and the same of Corporation Bank is only Rs. 1,48,097 crore.
TREND ANALYSIS OF TOTAL INVESTMENT OF SELECTED BANKS
Under This topic, the trend values of total investment for five years from March 2008 to March 2012 is calculated and forecasted for next three years from
March 2013 to March 2015.
TABLE 3: ESTIMATION OF INVESTMENT FOR THE YEAR 2013 TO 2015
Years Investments (Rs. In crore)
Corporation Bank Oriental Bank of Commerce
2008 16512 23951
2009 24938 28489
2010 34523 35785
2011 43453 49545
2012 47475 52101
2013 80035.4 61181.9
2014 88079.4 68917.8
2015 96123.4 76653.7
(Source: Annual reports)
The above table shows that investment capacities of both the bank have increasing trend. It is also clear from the table that both the banks will have increasing
trend of investment in the future. The investment of Corporation Bank during the years 2015 would be up to Rs.9,61,23.4 crore which is higher in comparison
than Oriental Bank of Commerce i.e. up to Rs.7,66,53.7 crore in the year of 2015.

SUGGESTION FOR SOUND INVESTMENT POLICY

A sound lending & investment policy is not only prerequisite for a bank's profitability but also crucially significant for the promotion of commercial savings of a
developing country like India. Therefore, the following principles or features of investment policy must be abided by the commercial banks in order to achieve
the goals.
• SAFETY AND SECURITY
Commercial banks must pay a special attention to the principle of safety and security. In a developing country like India in case there is any kind of loss than it
will lead to decrease in public faith towards banks and impacts the overall deposits of the banks. So, the banks must ensure investing the amount in safe and
secure sectors. Investment in unsafe and insecure sectors with the hope of getting more returns is to compromise with the security of capital.
• PROFITABILITY
The profit of commercial bank mainly depends on the interest rate, volume of loan, its time period and nature of investment in different securities. It is a fact
that a commercial bank can maximize its volume of wealth through maximization of return on their investment and lending so, they must invest their funds to
gain maximum profit. Ambition of profit to commercial bank seems reasonable as the bank has to cover all the expenses and make payment in the forms
dividend to the shareholders who contribute to building up of bank's capital and interest to the depositors. For this the bank calculates the cost of fund and
likely return.
• PURPOSE OF LOAN
A very important question for every banker is that, why a customer is in need for loan. If borrower misused the loan granted by the bank, he can never repay.
Therefore, in order to avoid this situation each and every bank should demand all the essential detailed information about the scheme of the project and all the
activities should be examined before lending.
• DIVERSIFICATION
"A bank should not lay all its eggs in the same basket." This saying is very important to the bank and it should be always careful not to grant loan in only one
sector. To minimize risk, a bank must diversify its investment on different sectors. Diversification of loan helps to sustain loss according to the law of average; if
the security of a company is divided off there may be an appreciation in the securities of other companies.

CONCLUSION
In the present research, study different financial and statistical tools have been used to measure the Investment policy of the selected banks. It is found that
both selected banks have strong financial performance but comparatively Oriental Bank of Commerce is in better position. It is concluded that Oriental Bank of
Commerce has adopted better investment policy than that of Corporation Bank. In conclusion, it can be said that RBI is required to direct the commercial banks.
Commercial Bank should move as per the direction given by the central bank. Banks should have optimum policy to collect the deposit in various accounts.
Higher the deposit higher will be the chances of mobilization of working fund and profit thereto. Banks should not invest their' fund haphazardly. It should be
careful while advancing loan because loan is the life blood of the commercial bank for survival. If commercial banks do not apply sound investment policy they
will face the challenges of recovery. Banks should invest their fund in various portfolios after a deep study of the project to be safe. Commercial Banks should
not cross the boundary level set by RBI to make their investment policy.

REFERENCES
1. American Institute of Banking. (1972). Principal of Bank Operation. USA:AIB.
2. Bexley, J.B.(1987). Banking Management. New Delhi: Sujeet publication.
3. Chen Ping, Yang Hailiang ,Yin George (2008) “Markowitz's meanvariance asset-liability management with regime switching: A continuous209 time model”
Insurance, Mathematics & Economics. Amsterdam: (Dec 2008.Vol. 43, Issue. 3);(Pg. 456-461)
4. Chipalkatti Niranjan , Rishi Meenakshi (2007) “Do Indian banks understate their bad loans?” The Journal of Developing Areas. Nashville: (Spring 2007. Vol.
40, Issue. 2) ;( Pg. 75-91)
5. Kothari, C.R. (1994).Quantitative Techniques. New Delhi: Vikash publishing Pvt. Ltd.Radhaswamy, M. and Vasudevan, S.V. (1979). A text book of Banking.
New Delhi: S. Chand Company Ltd.
6. Sharpe, W.F., Alexender, G.J. and Bailey, J.V. (1998). Investments. New Delhi: Pentice Hall of India Pvt. Ltd.
7. Singh, P. (1986). Investment Management. Bombay: Himalaya Publishing, House.

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VOLUME NO. 4 (2013), ISSUE N O. 01 (J ANUARY) ISSN 0976-2183
TREND ANALYSIS OF TOTAL DEPOSIT

ANNEXURE 1.1: ESTIMATION OF DEPOSIT OF CORPORATION BANK FOR THE YEAR 2013 TO 2015 (Rs. in crore)
Year Deposit(Y) Year (X) XY X2
2008 55424 1 55424 1
2009 73984 2 147968 4
2010 92734 3 278202 9
2011 116748 4 466992 16
2012 136142 5 680710 25
sum 475032 15 1629296 55
Here, the actual equation of linear trend is Y = a + bx
Two normal equations are
∑ Y=na+b ∑ x
∑ XY=a ∑ X+b ∑ X2
Putting the values on normal equations from the above table
475032= 5a+15b .............. (I)
1629296= 15a + 55b ............ (II)
To solve the above equation we multiply equation (I) by three and subtracting (I) from (II) we get,
1629296= 15a + 55b
1425096= 15a + 45b
- - -
204200 =10b b
b=204200/10
b=20420
Substituting the value of 'b' in equation (I), we get
475032 =5a +15x20420
5a =475032-306300
a = 168732/5
a = 33746.4
Thus, the required trend is
Y = 33746.4 +20420 X
Forecasting the deposit for the upcoming next 5 years
Y2013 = 33746.4+ 20420x6 = 156266
Y2014 = 33746.4+ 20420x7 = 176686
Y2015 = 33746.4+ 20420x8 = 197106

ANNEXURE 1.2: ESTIMATION OF DEPOSIT OF ORIENTAL BANK OF COMMERCE FOR THE YEAR 2013 TO 2015 (Rs. In crore)
Year Deposit(Y) Year- (X) XY X2
2008 77857 1 77857 1
2009 98369 2 196738 4
2010 120258 3 360774 9
2011 139054 4 556216 16
2012 155965 5 779825 25
sum 591503 15 1971410 55
Here, the actual equation of linear trend is Y = a + bx
Two normal equations are
∑ Y=na+b ∑ x
∑ XY=a ∑ X+b ∑ X2
Putting the values on normal equations from the above table
591503= 5a+15b...(I)
1971410= 15a +55b...(II)
To solve the above equation we multiply equation (I) by three and subtracting (I) from (II) we get,
1971410= 15a + 55b
1774509 = 15a + 45b
- - -
196901 = 10b
b =196901/10
b=19690
Substituting the value of 'b' in equation (I), we get
591503=5a+15x19690
5a=591503-295350
a= 296153/5
a = 59230
Thus, the required trend is
Y= 59230+19690 X
Forecasting the deposit for the upcoming next 5 years
Y2013 = 59230+19690 x 6 = 177370
Y2014 = 59230+19690 x 7 = 197060
Y2015 = 59230+19690 x 8 = 216750

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TREND ANALYSIS OF LOAN AND ADVANCES

ANNEXURE 1.3: ESTIMATION OF LOAN & ADVANCES OF CORPORATION BANK FOR THE YEAR 2013 TO 2015 (Rs. In crore)
Years Loan and Advances(Y) Year(X) XY x2
2008 39186 1 39186 1
2009 48512 2 97024 4
2010 63203 3 189609 9
2011 86851 4 347404 16
2012 100469 5 502345 25
sum 338221 15 1175568 55
Here, the actual equation of linear trend is Y = a + bx
Two normal equations are
∑ Y=na+b ∑ x
∑ XY=a ∑ X+b ∑ X2
Putting the values on normal equations from the above table
338221= 5a+15b…….(I)
1175568=15a + 55b……(II).
To solve the above equation we multiply equation (I) by three and subtracting (I) from (II) we get,
1175568= 15a + 55b
1014663= 15a + 45b
- - -
160905 = l0b
b =160905/10
b = 16090.5
Substituting the value of 'b' in equation (I), we get
338221 = 5a + 15 x 16090.5
5a =338221 -241357.5
a = 96863.5/5
a = 19373
Thus, the required trend is Y=19373+16090.5X
Forecasting the loan & advances for the upcoming next 5 years
Y2013 =19373+16090.5 x6= 115916
Y2014= 19373+16090.5 x7=132007
Y2015= 19373+16090.5 x8=148097

ANNEXURE 1.4: ESTIMATION OF LOAN & ADVANCE OF ORIENTAL BANK OF COMMERCE FOR THE YEAR 2013 TO 2015 (Rs. In crore)
Years Loan & Advances(Y) Year(X) XY x2
2008 54566 1 54566 1
2009 68500 2 137000 4
2010 83489 3 250467 9
2011 95908 4 383632 16
2012 111978 5 559890 25
sum 414441 15 1385555 55
Here, the actual equation of lineal trend is Y = a + bx
Two normal equations are
∑ Y=na+b ∑ x
∑ XY=a ∑ X+b ∑ X2
Putting the values on normal equations from the above table
414441= 5a+15 b (I)
1385555=15a + 55 (II)
To solve the above equation we multiply equation (I) by three and subtracting (I) from (IT) we get,
1243323= 15a + 55b
1385555= 15a + 45b
- - -
142232 = l0b
b =142232/10
b=14223
Substituting the value of 'b' in equation (I), we get
414441=5a+15x14223
5a=414441-213345
a=201096/5
a=40220
Thus, the required trend is
Y = 40220+14223X
Forecasting the deposit for the upcoming next 5 years
Y2013 = 40220+14223x6 = 125558
Y2014= 40220+14223x7=139781
Y2015 =40220+14223 x8= 154004

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TREND ANALYSIS OF INVESTMENTS

ANNEXURE 1.5: ESTIMATION OF TOTAL INVESTMENTS OF CORPORATION BANK FOR THE YEAR 2013 TO 2015 (Rs. In crore)
Years Investment Years (x) XY X2
2008 16512 1 16512 1
2009 24938 2 49876 4
2010 34523 3 103569 9
2011 43453 4 173812 16
2012 47475 5 237375 25
sum 166901 15 581144 55
Here, the actual equation of linear trend is Y = a + bx
Two normal equations are
∑ Y=na+b ∑ x
∑ XY=a ∑ X+b ∑ X2
Putting the values on normal equations from the above table
166901= 5a+15b… (I)
581144= 15a +55… (II)
To solve the above equation we multiply equation (I) by three and subtracting (I) from (II) we get,
581144= 15a + 55b
500703= 15a + 45b
- - -
80441 = l0b
b=80441/10
b=8044
Substituting the value of 'b' in equation (I), we get
166901=5a+15x8044
5a=166901-8044
a = 158857/5
a=31771.4
Thus, the required trend is Y= 31771.4+8044X
Forecasting the deposit for the upcoming next 3 years
Y2013 =31771.4+8044x6 = 80035.4
Y2014 = 31771.4+8044x7 =88079.4
Y2015 = 31771.4+8044x8 =96123.4

ANNEXURE 1.6: ESTIMATION OF INVESTMENTS OF ORIENTAL BANK OF COMMERCE FOR THE YEAR 2013 TO 2015 (Rs. In crore)
Years Investments (Y) Year(X) XY x2
2008 23951 1 23954 1
2009 28489 2 56978 4
2010 35785 3 107355 9
2011 49545 4 198180 16
2012 52101 5 260505 25
sum 189871 15 646972 55
Here, the actual equation of linear trend is Y = a + bx Two normal equations are
∑ Y=na+b ∑ x
∑ XY=a ∑ X+b ∑ X2
Putting the values on normal equations from the above table
189871= 5a+15b… (I)
646972=15a+55… (II)
To solve the above equation we multiply equation (I) by three and subtracting (I) from (II) we get,
646972= 15a + 55b
569613= 15a + 45b
- - -
77359 = 10b
b =77359/10
b=7735.9
Substituting the value of 'b' in equation (I), we get
189871= 5a+15x7735.9
5a =189871-116038.5
a= 73832.5/5
a = 14766.5
Thus, the required trend is
Y= 14766.5+7735.9X
Forecasting the deposit for the upcoming next 5 years
Y2013 = 14766.5+7735.9 x 6 = 61181.9
Y2014 = 14766.5+7735.9 x 7 = 68917.8
Y2015 =14766.5+7735.9 x 8 = 76653.7

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