OVERVIEW OF ECONOMY

In 2010-11 Economy took off in an environment of incipient domestic recovery and uncertainty about the State of global economy.

Economy estimated to have grown by 8.6 percent vis-à-vis growth of 8 percent in 2009-2010.

GDP growth in 2010-11 mainly aided by a rebound in agricultural growth at 5.4% vis a vis 0.4% in 2009-10 and sustained momentum in the Service Sector.

ECONOMIC OUTLOOK , 2011-12

Sustaining high growth will get impacted by persistent high inflation on account of high commodity prices.

Current Account Deficit is expected to be significant in 2011-12 – is financing will remain an issue…..?

Debt problems in the euro area.

Implication of abrupt rise in long term interest rates in advance economies.

Strong credit demand , prediction of normal monsoon, good pipeline investment and reduced energy intensity per unit of output may help sustain growth.

CHALLENGES BEFORE BANKING SECTOR

Growth in deposit lagging behind the projected credit growth.

Impact on Net Interest Income on account of tightening of provisioning norms and increase in SB Rate.

Transmission of global banking uncertainties impacting Emerging Economies.

Increased competition on account of opening of Banking Sector to Foreign / Indian Private sector entities.

WE ARE A BANK - - - - -

5

With Pan India Presence Having 2/3rd branch network in rural and semi

urban areas offering scope to improve client base Consistent growth in business with diversified

portfolio Technology deployment at par with the best in the

biz. Long experience in overseas operations.

Pan-India Presence

Covering all States & UTs• Zones : 35• Branches : 2204• EC : 4• ATM : 608

81

46

47

48 51

70

7747

56

44

70

5957

75

50

5573

71

90

91

51

60

64

48

54

89

71

96

46

77

59

47

29

52

47

As on 31st MAR, 2011

•Present in all States and UTs

•2 branches each in Singapore &Hongkong Total 4 branches

•Rep offices in KualaLampur & Guangzhou in China

6

Total Branches 2204

(+4)Rural 805

Semi Urban 462

Urban 478

Metro 457

ATM 608

BRANCH NETWORK (31.3.2011)

All branches under CBS Presence in all States & Union Territories Two Branches each in Hong Kong & Singapore Centres Representative Offices in Kuala Lumpur & Guangzhou in China

7

805

462478

457 Rural

Semi Urban

Urban

Metro

Govt . of India

68.13%

FIs 1.10%

FIIs 5.41%

Insurance Cos

9.14%

Corporate Bodies

3.30%

Public 12.51%

Others 0.41%

Share Holding Pattern, Mar. 2011

68.13%1.10%

5.41%

9.14%

3.30% 12.51%

0.41%

GOI FIs FIIs Insurance Cos Corporate Bodies Public Others

8

Rs. in Crore

PARAMETER FY 2009-10 FY 2010-11 Y-O-Y GrowthDEPOSIT 122415 145278 18.68%ADVANCE 83371 100561 20.62%INVESTMENT 43700 43124 -1.32%BUSINESS 205786 245839 19.46%

Y O Y ↑

18.68%Y O Y ↑

20.62%

FY 2009-10 FY 2010-11

122415145278

DEPOSIT

DEPOSIT

FY 2009-10 FY 2010-11

83371

100561ADVANCE

ADVANCE

GLOBAL BUSINESS

Rs. in CroreCOMPOSITION OF DOMESTIC DEPOSITS

PARAMETERS FY 2009-10 FY 2010-11 Y-O-Y Growth(%)

TOTAL DEPOSIT 115956 136415 17.64%

CASA 27322 31652 15.85%

Term Deposit 88634 104763 18.20%

TOTAL DEPOSIT CASA Term Deposit

115956

27322

88634

136415

31652

104763

FY 2009-10FY 2010-11

DOMESTIC ADVANCES CATEGORY WISERs. in Crore

PARAMETERS FY 2009-10 FY 2010-11Corporate Credit 53,633 68,098Retail 10,229 9,421SME 13,706 15,727Agriculture 14,309 11,664Total Loans & Advances 77,568 93,246

Corporate Credit Retail SME Agriculture

53,633

10,22913,706 14,309

68,098

9,42115,727

11,664

FY 2009-10FY 2010-11

INTEREST INCOME (Global)Rs. in Crore

PARAMETERS. `FY 2009-10 FY 2010-11

Y-O-Y Growth(%)

Interest on Advances 7107 8,505 19.68Interest on Investments 2189 2700 23.34Other Interest Income 231 165 -28.57Total Interest Income 9526 11371 19.37

INTEREST INCOME UP by 19.37%

7107

2189231

FY 2009-10

Interest on Advances

Interest on Investments

Other Interest Income 8505.39

2700165

FY 2010-11

INTEREST EXPENDED (Global) Rs. in Crore

PARAMETERS. FY 2009-10 FY 2010-11Y-O-Y

Growth(%)

Interest on Deposit 6577 6842 4.03Interest Paid on Refinance 146 88 - 39.73Interest Paid on Bond 271 380 40.22Other Interest Paid 209 215 2.87Total Interest Expenditure 7202 7525 4.48

6577

146271 209

FY 2009-10

Interest on Deposit

Interest Paid on Refinance

Interest Paid on Bond

Other Interest Paid

6842

88380215

FY 2010-11

Interest increased

only by 4.48% while

Deposit increased by 18.68%

OTHER INCOME (GLOBAL)

OTHER INCOMEFY 2009-

10FY 2010-

11 Recovery in Written off A/c 43 84 Profit on Exchange Transaction 66 113 Profit on Sale of Investment 243 92 Fee based Income 249 251 Others 365 386 TOTAL OTHER INCOME 966 926

Rs. in Crore

4366

243

249

365

FY 2009-10 Recovery in Written off A/c

Profit on Ex-change Transac-tion

Profit on Sale of Investment

Fee based Income

Others

84 113

92

251

386

FY 2010-11

STAFF COST & OPERATING EXPENSES

PARAMETERSFY 2009-

10FY 2010-

11Y-O-Y

Growth(%)

STAFF EXPENSES 1058 1480 39.89

OTHER EXPENSES 527 595 12.90

STAFF EXPENSES OTHER EXPENSES

1058

527

1480

595FY 2009-10FY 2010-11

Rs. in Crore

Employee Benefits as per AS-15

Rs. In Crore

Particulars9 months ended 31.12.2010

Q4 - quarter ended 31.03.2011

Full Year 2010-11

Pension 324 201 525Gratuity 84 60 144Leave encashment & other 45 (3) 42

Total 453 258 711

Rs. In Crore No. Amount

Second pension optees:Retired / Expired 2427 55

Inservice 10563 101 Existing pension optees 24316 369

Total 37306 525

Working Expenses Provision Working Expenses Provision Rs.265 cr Rs.188 cr Rs.128 cr Rs.130 cr

PARAMETERSFY 2009-

10FY 2010-

11Y-O-Y

Growth(%)

Total Interest Income 9526 11371 19.37Total Interest Expenditure 7202 7525 4.48

Net Interest Income 2324 3846 65.49

Total Interest Income Total Interest Expenditure Net Interest Income

9526

7202

2324

11371

7525

3846FY 2009-10

FY 2010-11

NII UP BY 65.49%

NET INTEREST INCOME (Global) Rs. in Crore

OPERATING PROFIT & PROVISIONING Rs. in Crore

PARAMETERS FY 2009-10 FY 2010-11 Y-O-Y Growth(%)

OPERATING PROFIT 1705 2695 58.06

PROVISION 693 1788 158.01

NET PROFIT 1012 907 -10.38

OPERATING PROFIT PROVISION NET PROFIT

1705

6931012

2695

1788

907

FY 2009-10FY 2010-11

UP BY 58.06%

Details of Restructured Account Accounts Amount

Total Restructured Assets as on 31.03.2010 79091 5851

Add: Accounts restructured during 9-month i.e. 01.04.2010 to 31.03.2011 3391 474

Total Restructured Assets as on 31.03.2011 82482 6325Less: Total NPA accounts restructured included above 1546 114Total Standard account restructured up to 31.03.2011 80936 6211% of Restructured Advances/Portfolio to Total Loans and Advances (as on 31-03-2011)   6.24

Of which slippage into NPA 5768 820Provision made for diminution in fair value in Restructured Standard Accounts   165

RESTRUCTURED ACCOUNTSRs. in Crore

PARAMETERSFY 2009-10 FY 2010-11

GROSS NPA OPENING 1540 1666

ADD: FRESH 1109 2730

LESS: CASH RECOVERY 399 434

UPGRADATION 212 226

WRITE OFF 371 586

CLOSING GROSS NPA 1666 3150

% GROSS NPA 1.99 3.13

NET NPA 966 1825

% NET NPA 1.17 1.84

PROVISION COVERAGE RATIO(%) 50 51.6

IMPAIRED ASSETSRs. in Crore

SUBSTANDARD ASSETS DOUBTFUL ASSESTS

LOSS ASSETS

FY 2009-10 FY 2010-11

700

1797

154 202

NPAProvision Coverage

FY 2009-10 FY 2010-11

9151112

518674

NPAProvision Cov-erage

FY 2009-10 FY 2010-11

175 180175 180

NPAProvision Coverage

Rs. in Crore

PROVISION DETAILS FY 2009-10 FY 2010-11 Y-O-Y Growth(%)

PROVISION TOWARDS NPA 354 1180 233.33

DEPRECIATION ON INVESTMENTS 89 192 115.73

STANDARD ASSET 6 68 1033.33

ARREAR SALARY 134 13 -90.30

PENSION/EMP BENEFITS 148 318 114.86

MAT 37 38 2.70

TOTAL PROVISION 693 1788 158.01

1180

192

68

13318 38

FY 2010-11

354

89

6

134

14837

FY 2009-10PROVISION TOWARDS NPA

DEPRECIATION ON INVEST-MENTS

STANDARD ASSET

ARREAR SALARY

PENSION/EMP BENEFITS

MAT

Rs. in Crore

PROVISION COVERAGE

FY 2009-10 FY 2010-11

1.99000000000001

3.13

% GROSS NPA

% GROSS NPA

FY 2009-10 FY 2010-11

1.17

1.84

% NET NPA

% NET NPA

FY 2009-10 FY 2010-11

50

51.6

PROVISION COVERAGE RATIO(%)

PROVISION COVERAGE RATIO(%)

Transfer to counter cyclical buffer account : Rs 210 Cr

PERFORMANCE RATIOS

PARAMETERS FY 2009-10 FY 2010-11COST OF DEPOSIT (%) 6.44 5.74

YIELD ON Investment (%) 7.20 7.46

YIELD ON ADVANCE (%) 10.13 10.00

COST OF DEPOSIT (%

)

YIELD O

N Investm

ent (%)

YIELD O

N ADVANCE (%)

6.44 7.20

10.13

5.74 7.21

10.00

FY 2009-10FY 2010-11

IMPROVING PERFORMANCE INDICES

FY 2009-10 FY 2010-11

6.445.74

COST OF DEPOSIT (%)

FY 2009-10 FY 2010-11

10.13 10.00

YIELD ON ADVANCE (%)

FY 2009-10 FY 2010-11

7.20 7.21

YIELD ON Investment (%)

FY 2009-10 FY 2010-11

2.19

3.07

NET INTEREST MARGIN (%)

FY 2009-10 FY 2010-11

48.1643.51

COST TO INCOME RATIO (%)

PERFORMANCE RATIOS

PARAMETERS FY 2009-10 FY 2010-11

EARNING PER SHARE 17.4714.29

BOOK VALUE 65.74 82.00

EARNING PER SHARE BOOK VALUE 0

10

20

30

40

50

60

70

80

90

17.47

65.74

14.29

82.00

FY 2009-10FY 2010-11

CAPITAL ADEQUACY BASEL - II

PARAMETERSFY 2009-10 FY 2010-11

BASEL-II (%) 13.21 13.71

TIER -I(%) 7.05 8.52

TIER -II (%) 6.16 5.19

FY 2009-10 FY 2010-11

7.05

8.52

6.16

5.19

TIER -I(%)

TIER -II (%)

5012

4376

7012

4266

T1 includes Rs 673 Cr PNCPS & Rs 940 Cr as equity received from Govt. at a premium of Rs. 110.27

T-1 Rs. In Crs.

T-2 Rs. In Crs.

Equity 628Upper T-2 1620PNCPS 1823Lower T-2 2015IPDI 380Others 631R & Surplus 4181   Total 7012Total 4266

INTEREST INCOME

PARAMETERS. `Q 4

MAR 10

Q 4 MAR 11

Y o Y Growth

Interest on Advances 1751 2,299 31.30Interest on Investments 608 727 19.57Other Interest Income 77 43 -44.16

Total Interest Income 2436 3,069 25.99

UP by 25.99%

1751

60877

Q 4 MAR 10

Interest on Advances Interest on Investments Other Interest Income

2299

72743

Q 4 MAR 11

Rs. in Crore

INTEREST EXPENDED

PARAMETERS.

Q 4 MAR 10

Q 4 MAR 11 Y o Y Growth

Interest on Deposit 1540 2049 33.05Interest Paid on Refinance 31 18 -41.94Interest Paid on Bond 71 93 30.99Other Interest Paid 50 64 28.00Total Interest Expenditure 1692 2224 31.44

1540

31 71 50

Q 4 MAR 10

Interest on Deposit Interest Paid on RefinanceInterest Paid on BondOther Interest Paid 2049

18 93 64Q 4 MAR 11

Rs. in Crore

PERFORMANCE RATIOSPARAMETERS Q 4 MAR 10 Q 4 MAR 11

COST OF DEPOSIT (%) 5.58 6.34YIELD ON Investment (%) 7.16 7.39

YIELD ON ADVANCE (%) 9.29 9.86NET INTEREST MARGIN (%) 2.63 2.35

5.587.16

9.29

2.63

6.347.39

9.86000000000001

2.35

Q 4 MAR 10Q 4 MAR 11

GROWTH IN NII BY 13.58

%

NET INTEREST INCOME

PARAMETERS Q4 2010 Q4 2011Y-O-Y

Growth(%)

INTEREST INCOME 2436 3069 25.99

INTEREST EXPENSES 1692 2224 31.44

NET INTEREST INCOME(NII) 744 845 13.58

INTEREST INCOME INTEREST EXPENSES NET INTEREST INCOME(NII)

2436

1692

744

3069

2224

845

Q4 2010Q4 2011

Rs. in Crore

PERFORMANCE RATIOS

PARAMETERS Q 4 MAR 10 Q 4 MAR 11

EARNING PER SHARE 6.68 3.48

BOOK VALUE (`) 65.74 82.00

Q 4 MAR 10 Q 4 MAR 11

6.6814.29

65.74

83.16

EARNING PER SHARE (%)BOOK VALUE (`)

Rs. in Crore

PERFORMANCE RATIOS

PARAMETERS. Q 4 MAR

10 Q 4 MAR 11

Employment Cost 287 381

Other Ops 144 176

Q 4 MAR 10 Q 4 MAR 11

287

381

144176

Employment CostOther Ops

PERFORMANCE RATIOS

PARAMETERS. Q 4 MAR

10 Q 4 MAR 11

Treasury Ops 27 28Exchange Profit 69 87Forex Profit 16 28Other Non Interest Income 141 150

27

69

16

141

28

87

28

150

Q 4 MAR 10Q 4 MAR 11

Rs. in Crore

Eight Field General Managers posted across the country as extended arms of Head Office to oversee and control all 35 Zones and vested with all necessary administrative and lending powers for seamless operation.

Zonal Offices directly controlling the service outlets / branches.

Flagship Corporate and Mid Corporate lending being handled directly by the respective Headoffice verticals.

NPA management & recovery above a threshold limit done by the Asset Recovery Branches

Central Processing Centres, Retail Processing Hubs, and SME hubs in place for quick disposal of credit proposals and ensuring acquisition of quality assets.

City Back Offices providing support system to branches for better customer service.

Branches transformed into “service outlets ” to concentrate on customer acquisition / retention, fee-based income, govt. & e-business.

Leveraging technology for efficiency, cost savings & increasing market share.

EXISTING SETUP

Entry level Recruitment of clerks

Entry level Recruitment of Probationary Officers

Direct recruitment of Officers from the leading management institutes.

Lateral Recruitment of Chartered Accountants and Specialist Management Executives and HR Specialist.

Executives/Officers deputed for trainings in leading management institutes in India and Abroad.

HRM Initiatives

LOOKING AHEAD……

By Mar’2013 By Mar’2016

3000 domestic branches 4000 domestic branches

3000 ATMs 5000 ATMs

Rs.2.2 lac crore deposit Rs.3.60 lac crore deposit

Rs. 3.5 lac crore business Rs.6.00 lac crore business

3 crore a/c holders 4.8 crore a/c holders

Expanded overseas operations to better serve globalised customer base.

SME Loan Hubs proposed across the country at major industrial clusters .Already setup at Mumbai, Newdelhi and Kolkata rest will follow.

Special SME vertical setup at Head Office to monitor and push SME advances.

These hubs shall deliver speedy disposal of credit proposal between Rs 25.00 lacs to Rs 25.00 crore pertaining to Small and Medium Enterprise.

In addition to SMEs as per RBI’s definition, all other entities with annual sales of Rs.1 Cr. to Rs.100 Cr. and New Infrastructure and real estate projects where the project cost upto Rs.50 Cr. Covered under SME.

SME INITIATIVES

Over 70% of SME Advances Revenue is concentrated in the top 15 Cities and 9 Industries

0

20

40

60

80

100

75

11

14

SME Advances Revenues

Pe

rrce

nt

1 Mumbai2 Delhi3 Chennai4 Kolkata5 Bangalore6 Hyderabad7 Ahmedabad8 Coimbatore9 Pune10 Chandigarh11 Ludhiana12 Jaipur 13 Varodara14 Ernakulam 15 Surat

Remaining Cities

25 Cluster Cities

Top 15 Cities

0

20

40

60

80

100

70

30

SME Advances Revenues

Perr

cent

1 Wholesale Traders2 Textiles3 IT & Profes-sion Services4 Retail Traders5 Metal Works6 Food Pro-cessing7 Real Estate8 Transport & Logistics9 Auto & Auto Ancillary

Remaining Sectors

Top 9 Sec-tors

IT INITIATIVES Core Banking Solution

All 2202 branches and 4 Extension Counters have been made live under Core Banking Solution (CBS) covering 100% of the business of the Bank

All branches of the Bank are RTGS and NEFT live

Extension of facility of RTGS and NEFT through E-Banking implemented

The implementation of CBS started in all the 5 RRBs of the bank and will be completed by the year end.

ATM

Total number of ATMs as on 31.03.2011 is 608

Deployment of 500 ATMs/CDs is in progress on CAPEX model .

Process of implementation of another 1000 ATMs/CDs on OPEX model (per transaction basis) started.

UCO E-Banking

Beneficiary Registration System:

Bank has successfully implemented Beneficiary Registration for e-Banking online fund transfer/Bill payment.

The SMS/email based One time Activation Code (OAC) since being generated and authenticated to register the beneficiaries for making any e-payments

UCO MOBILE BANKING:

Complete transaction based Mobile banking

has been successfully launched with the

features such as

Fund Transfer (from Mob to Mob & Mob to

a/c)

Balance enquiry and Mini Statement

Mobile Recharge

Bill Payment / e_ Ticketting

ATM card hotlisting etc

ON LINE SHARE TRADING:

An integrated solution for the e-Banking users

Customers having Demat accounts with our Bank for making online share trading through M/s Religare.

Online Share trading module has been integrated with e-Banking platform

Digital Slip implemented in DP Server to be used for online buy & sell of stocks.

Bank on Wheels: A single mobile infrastructure with complete

Bank-on-wheels

Banking services like customer enrolment through biometric ATM, issuance of non-personalized Debit Cards, receipt and payment of cash, printing of Passbook, collection of cheque, remittance facilities through DD / RTGS / NEFT, collection of loan applications and credit disbursal etc. made available at the doorstep of customers

24 Bank on Wheels has already been started functioning

OTHER IT INITIATIVES

Some other initiatives undertaken by the Bank:

ASBA facility – through designated branches and also extended

to e- banking customers of the Bank

Direct Tax Payment through ATM

Third Party Fund Transfer through ATM

Central Plan Scheme Monitoring System(CPSMS)

Collection of Railway freight

Online booking of Railway Tickets

IT INITIATIVES for 2011-12

A few of the major IT initiatives slated for 2011-2012 are : Global TreasuryData Ware housingCall CentersCRMPayment GatewayHRMSPrepaid Smart Cards

FINANCIAL INCLUSIONAll unbanked villages numbering 72,800 with

population of 2000+ are to be provided with banking facilities through formal financial system.

UCO Bank allocated 1780 unbanked villages which are to be covered by March 2012.

Financial Inclusion Plan drawn up having three way approach:

Brick and Morter Branches Mobile Banks ICT based BC Model

Till March 2011, 979 villages covered through above three approaches.

UCO SATHI