1. 1.1.

Your Board of Directors have pleasure in presenting the 75th Annual Report ofyour Bank, together with the audited Balance heet, !rofit and "oss Account and the reporton #usiness and operations for the year ended $1st %arch, &'1$. 1.&. (he Bank has delivered a strong perfor)ance in *Y &'1&+1$. (he Bank,sstrategy of consolidation, re+engineering, re+pricing and re+organisation has resulted inproductive and efficient growth, ro#ust #alance sheet, reality asset #ook and su#stantialprovisions. *inancial highlights for the year under review are presented #elow2. Performance at a Glance &.1 (he aggregate #usiness of the Bank crossed yet another )ilestone )ark and stood atRs. 1,'$,.&1.'$ /rores at the end of *Y &'1&+1$. (he total #usiness of the Bank increased#y Rs. 10,110.71 /rores fro) the previous year,s figure of Rs. 20,.&..$& /rores,registering a growth of 11.073. &.& (he total deposits of the Bank have grown #y Rs. 1',27$.7& /rores fro) Rs. 5$,$.0.1' /rores, as on $1st %arch, &'1&, to Rs. .0,&&'.0& /rores, as on $1st %arch, &'1$,registering a growth of &'.$23. /A A deposits of the Bank at Rs. &5,111 /rores constituted$1.&$3 of total deposits of the Bank. &.$ /ost of deposits for current *Y stood at 0.273. &.. (he Bank continued its prudent approach in e4panding 5uality credit assets in linewith its policy on /redit Risk %anage)ent. (he net advances of the Bank increased #y Rs. 0,1&&.11 /rores fro) Rs. $$,'77..& /rores, as on $1st %arch, &'1&, to Rs. $1,&''..1/rores, as on $1st %arch, &'1$, a growth of 12.513. &.5 Yield on advances for the current *Y i)proved to 1&.513, co)pared to 1&.1&3 for *Y&'11+ 1&. &.0 !riority sector advances 67ross8 stood at Rs. 11,511.52 /rores, as on $1st %arch,&'1$. $. (he Bank,s perfor)ance in the recovery of 9!As during the year continued to #egood. (he Bank effected cu)ulative cash recovery: upgradation of 9!As and technicalwrite+off of Rs. $&7.2$ /rores, co)pared to Rs. $10.11 /rores in the previous year. .. ;nvest)ent portfolio of the #ank increased #y Rs. .,110.7. /rores fro) Rs. &1,0&..$&/rores, as on $1st %arch, &'1&, to Rs. &5,7.1.'0 /rores, as on $1st %arch, &'1$. 5. Insurance Business 5.1. (he Bank,s inco)e reached Rs. $7..1 /rores fro) the ;nsurance Business. ;nlife insurance, the Bank )o#ilised #usiness of Rs. 0$... /rores and in non+life seg)ent,#usiness of Rs. 1&.22 /rores was )o#ilised during the year. 6. Income Analysis 0.1. ;nterest inco)e of the Bank recorded a growth of Rs. 1,$'1.&& /rores and increasedfro) Rs. .,2$5.52 /rores in *Y &'11+1& to Rs. 0,1$0.2' /rores in *Y &'1&+1$. ;ntereste4penses increased fro) Rs. &,117.&& /rores to Rs. $,2&'.70 /rores during the year. (he9et ;nterest ;nco)e increased fro) Rs. 1,2$2.$0 /rores to Rs. &,$10.'. /rores on YoY#asis. 0.&.(he 9et ;nco)e fro) operations <;nterest pread plus 9on+interest ;nco)e= hasincreased to Rs. &,711.77 /rores in *Y &'1&+1$ fro) Rs. &,17&..2 /r in *Y &'11+1&, growing#y &2.273. 0.$.(he >perating ?4penses e4hi#ited an increase of Rs. 120.20 /rores during *Y &'1&+1$and stood at Rs. 121.'1 /rores, as co)pared to Rs. 2'&.15 /rores in *Y &'11+1&. 0... (he /ost to ;nco)e ratio 6>perating ?4penses to 9et >perating ;nco)e8 has co)edown fro) $0.1&3 in *Y &'11+1& to $5.$$3 in *Y &'1&+1$.

7. Gross Profit 7.1. (he 7ross !rofit for *Y &'1&+1$ stood at Rs. 1,21'.70 /rores, as co)pared to Rs. 1,$7'.$$ /rores in *Y &'11+1&, registering a growth of $&.1.3. (he aggregate #usiness of the Bank crossed yet another )ilestone )ark and stood at Rs. 1,'$,.&1.'$ /rores at the end of *Y &'1&+1$. e total #usiness of the Bank increased #y Rs. 10,110.71 /rores fro) the previous year,s figure of Rs. 20,.&..$& /rores, registeringa growth of 11.073. 8. Provisions 2.1. (he !rovision for "oan "osses, !rovision on tandard Assets, (a4ation and othersaggregated to Rs. 755.00 /rores in *Y &'1&+1$, as co)pared to Rs. 507.'2 /rores in *Y&'11+1&. 9. Net Profit and Dividend 1.1. (he Bank registered highest ever 9et !rofit of Rs. 1'55.1' /rores for *Y &'1&+1$,as co)pared to Rs. 2'$.&5 /rores for *Y &'11+1&, up #y an i)pressive $1.$53. 1.&.(he Board of Directors has reco))ended a record dividend of 5''3 for *Y &'1&+1$. 1.$.;n ter)s of e4tant guidelines, the Bank will pay the dividend distri#ution ta4 for*Y &'1&+1$. Accordingly, the total outflow on account of dividend for *Y &'1&+1$ will #eRs. &2$.52 /rores, including the dividend distri#ution ta4. !. Net "ort# and $%A% 1'.1. (he 9et @orth of the Bank increased to Rs. .,2.0.01 /rores, as on $1st %arch,&'1$, fro) Rs. .'1$.12 /rores on $1st %arch, &'1&. 1'.&. (he /apital to Risk AdAusted Assets Ratio 6/RAR8 under BA ?"+; stood at 1&.$.3,as on $1st %arch, &'1$, which is )uch a#ove the nor) of 13 stipulated #y the Reserve Bankof ;ndia. (he (ier+; co)ponent of /RAR stood at 1'...3, as on $1st %arch, &'1$. 1'.$. (he Bank has i)ple)ented new capital ade5uacy fra)ework w.e.f. $1st %arch, &''1.Bnder new nor)s, the Bank,s /RAR 6BA ?"+;;8 works out to 1&.2$3, which is higher thanthe /RAR as co)puted under BA ?"+; nor)s. (he advantage has ste))ed )ainly fro) higherrated ;nvest)entC/redit portfolio. (he (ier+; co)ponent of /RAR under new nor)s is 1'.203under BA ?"+;. 1'...(he Return on Average 9et @orth, ?arnings per hare and Book Dalue per hare forthe *Y &'1&+1$ stood at &$.503, Rs. &17.0. and Rs. 1,''$..1, as against &1.&&3, Rs. 105.01and Rs. 2...$., respectively, for the previous year. . Branc# Net&or' During *Y &'1&+1$, 7' new #ranches were esta#lished and 1& ?4tension /ounters wereupgraded into full+fledged Branches, there#y taking the nu)#er of #ranches to 025, as on$1st %arch, &'1$, spread over &' states and one union territory. (he area+wise #reakup ofthe #ranch network 6e4cluding e4tension countersC)o#ile #ranches and ervice #ranches8, asat the end of *Y &'1&+ 1$ is as underArea Branc#es %etro (9 Br#an 78 e)i+Br#an (6 Rural ((2

)*)A+ 685 2. I) initiatives durin, -. 2! 2/ ( (echnology has played a pivotal role in the growth of the Bank. (E; D depart)enthas always #een at the forefront in delivering solutions in line with the changing#usiness needs of the organisation. As a )atter of policy, the Bank has always providedindustry #est solutions, so as to align the technology with #usiness goals. (he details ofvarious technology initiatives taken during *Y &'1&+1$ are enu)erated #elowF %o#ile Banking introduced with the following featuresi8 ;ntra Bank *und (ransfer ii8 ;nter Bank *und (ransfer 6;%! 8 iii8 Balance ;n5uiry iv8 tate)ent Re5uest v8 /he5ue top Re5uest vi8 /he5ue Book ;n5uiry F /he5ue (runcation yste) 6/( 8 was deployed at Gydera#ad, (hiruvanthapura),Hochi, %ysore, Holkata, /handigarh and /oi)#atore. F 1'5 new A(% were co))issioned during the year, taking the total nu)#er of A(% to 01$. (he Bank continued its prudent approach in e4panding 5uality credit assets in line withits policy on /redit Risk %anage)ent. e net advances of the Bank increased #y Rs. 0,1&&.11/rores fro) Rs. $$,'77..& /rores, as on $1st %arch, &'1&, to Rs. $1,&''..1 /rores, as on$1st %arch, &'1$, a growth of 12.513. F (he network of all the outside state #ranches was )igrated to %!" with higher#andwidth and in#uilt redundancy. F yste) "evel Asset /lassification was upgraded to include all the accounts, asagainst the ceiling of sanction li)it of Rs. 5' lacs in the first phase. F upporting the >rganisations #ranch e4pansion plans, 77 new ols were opened on/B , taking the total ol count to 7.2, which includes Branches, >ffices and ?4tensioncounters. All the network+related infrastructures have #een provided at all the #ranchesopened during the financial year. F (he three+way Disaster Recovery 6DR8 proAect has #een co)pleted and twosuccessful DR drills conducted on the new set up. During the financial year, DR for @;*(and ;(% has #een put in place. (he DR setup for /( is under i)ple)entation. F %; CAD* solution was i)ple)ented and parallel runs were conducted for *inancial/onsolidator. F /learing Gouse at Hargil )ade functional. F ;n order to facilitate issuance of eBR/ in our Bank, which has replaced thesyste) of uploading eBR/, an in+house @e#+Application has #een developed. (his has ensuredco)pliance to RB; directives in this regard. F As a part of co)pliance to the )andate on "( C(D fro) 9!/;, necessarycusto)isation stands i)ple)ented on A(% witch. (his feature will reduce custo)erco)plaints on account of failed transactions. F ;)ple)ented the ;( 7overnance fra)ework, as prescri#ed #y RB;. ;ndependentfunctions for assurance and security were put in place. (. Advertisin, and Pu0licity

/ontinuing with its proactive approval of #rand positioning within the wider pu#licconsciousness and )e)ory, the Bank )aintained its #rand pri)acy during the year. (he Bank,s products, services, functioning and achieve)ents were effectivelyadvertised and co))unicated to the respective target audience, which includes custo)ers,stakeholders and general pu#lic through properly packaged )essages, using wider andrelevant )edia. (he Bank also entered into the virtual space of social )edia networking to furthersupple)ent its online processes of i)age #uilding and pu#licity. 1. $or2orate 3ocial %es2onsi0ility/$3% IEH Bank #elieves in putting people #efore profits. (he /orporate ocial Responsi#ility 6/ R8 of the Bank is aligned with its visionstate)ent of e)powering people through servant leadership. ;t recognises o#ligationstowards society and ai)s at )a4i)ising #oth #usiness and social perfor)ance. IEH Banktreats contri#utions to / R as an earning, rather than e4penditure. *ro) )atters of health to heritage, education to entrepreneurship, poverty alleviationto paucity aug)entation + our / R policy covers it all. (he ai) is to instil a sense of relief and protection a)ong the vulnera#le sections ofsociety, #esides providing opportunities for the survival, sustenance and e)power)ent ofpeople. (he approach adopted in conceiving, handling and i)ple)enting / R initiatives issi)ple, yet professional. At ti)es, it is )assive yet )ethodical. (aking a long+ter) view of its / R initiatives, IEH Bank e)ploys organised andinnovative interventions to ensure )a4i)isation of #oth social and econo)ic returns. (hus,capitalising on the e4pertise of the professionals and organisations pursuing variouscauses of societal concern continue to #e our guiding force in the i)ple)entation ande4ecution of our / R initiatives. 5. 4a5or $3% Initiatives ta'en 0y t#e Ban' ?ducation continued to receive top priority. (o a school of re)ote Haprin village in hopian district, the Bank provided &$ co)puters for esta#lishing a co)puter la# thatcaters to the students fro) the near#y areas, in addition to the students of that school."ikewise co)puters and other learning aids were donated to doJens of schools. (he Bankfurther e4panded its progra))e of sponsoring education of children #y partnering with alocal 97> for professionally )anaging education of &' children co)ing fro) socially andecono)ically disadvantaged #ackgrounds, under the organisation,s scientificallyoriented Re)ote /hild ponsorship !rogra))e. (his is in addition to the colla#oration thatthe Bank already has with two )ore such organisations pursuing the cause of educationCreha#ilitation of specially a#led children. ;n the health seg)ent, the Bank )adereasona#le )onetary contri#utions for various health proAects undertaken #y reputednot+for+ profit organisations, like ;ndian Red /ross ociety, /ancer ociety of Hash)ir andso on. (he Bank also participated in the progra))es 6of Aditya+Iyoti and /?9KB;9, two reputed97>s8 )eant for reha#ilitation of various slu) dwellers and other initiatives outsideIEH to e)power the poor people. (he Bank provided financial assistance to theGe)ophilia ociety, Delhi, for the treat)ent of he)ophilia patients fro) (ullwari, are)ote village along "o/, which was adopted #y the Bank in &'11. (he #ank kick+started its !latinu) Iu#ilee cele#rations on &1st %arch, &'1$, the dayo#served as the @orld Ar#or Day. ;t started the cele#rations #y a )assive, week+longplantation drive, in which 75,''' saplings of various species were planted throughout thestate of Ia))u and Hash)ir. (he highly acclai)ed / R progra))e of the Bank to develop and)aintain parks for providing )eans of entertain)ent to the people of the state, was takenfurther #y dedicating one

)ore such park, Rani Bagh, to the people of outh Hash)ir.9ota#ly, with Rani#agh, the nu)#er of parks developed and )aintained #y IEH Bank has)oved up to nine. (he Bank played a lead role in providing relief and reha#ilitation in*rislan, a village near the world fa)ous tourist resort of !ahalga). %ore than thirtyhouses were destroyed in a devastating fire in *rislan, leaving victi)s ho)eless and in astate of despair. 6. +ead Ban' %es2onsi0ility (he IEH Bank is the only private sector #ank in the country assigned with theresponsi#ility of convening tate "evel Bankers, /o))ittee )eetings. (he Bankcontinued to discharge its lead #ank responsi#ility in 1& out of && districts of IEH tate satisfactorily. (he tate Annual /redit !lan for the *Y &'1&+1$ was launched in ti)e and itsi)ple)entation was )onitored on 5uarterly intervals in tate "evel Bankers, /o))ittee)eetings. During *Y &'1&+1$, out of the total A/! target of Rs. 0,'1..5' /rores for thestate, #anks operating in the state dis#ursed credit of Rs. .,112.1. /rores, registeringan achieve)ent of 213. >ut of the total priority sector credit of Rs. .,112.1. /rores dis#ursed #y all #anksin the tate upto $1st %arch, &'1$, IEH Bank alone has dis#ursed Rs. $,&&5.07 /roresagainst the target of Rs. $,1&$.&& /rores, there#y achieving 1'$3 of its annual A/!target, which accounts for a lion,s share of 003 of the total flow of credit topriority sector #y all #anks in the state. Durin, -. 2! 2/ (6 follo&in, meetin,s &ere conducted7 F *our 5uarterly tate "evel Bankers /o))ittee 6 "B/8 )eetings, viJ. 25th, 20th,27th and 22th to review perfor)ance under A/!. F (wo )eetings conducted, one on &5th August, &'1&, and the other on &2th %arch,&'1$ of the teering u#+/o))ittee of IEH "B/ to )onitor flow of credit to theAgriculture ector A )eeting of the su#+co))ittee of tate "evel ;nter+;nstitutional/o))ittee 6 ";;/8 to discuss reha#ilitation of sick % %? units in IEH tate held on$rd August, &'1&. F A %eeting of the u#+group of IEH "B/ constituted to prepare a @orka#leAction !lan for enhancing /.D.Ratio of IEH tate held on 1&th April, &'1& 6to co)plywith the directive of 7overnor, RB;, given in the pecial "B/ )eeting8. F (he #i+annual )eeting of /hair)an, IEH Bank, with all the "ead District%anagers of IEH state at rinagar, as per 7o;, %o* Directive. F (he tate "evel teering /o))ittee 6 " /8 on R ?(;s held on 15th Iuly, &'1&, at rinagar. F (he district level and #lock level )eetings, such as D//C D"R/C B"B/ and otherrelative )eetings under "ead Bank che)e held during *Y &'11+1&, as per schedule in alldistricts. Im2lementation of -inancial Inclusion Plan 8-IP9 F (he target of providing ;nfor)ation and (echnology /o))unication 6;/(8+#ased#anking services in 715 identified un#anked villages 6having population over &,'''8 wasal)ost acco)plished, leaving only nine villages uncovered due to lack of connectivity andother infrastructural deficiencies at these places. >ut of the total priority sector credit of Rs. .,112.1. /rores dis#ursed #y all #anksin the tate upto $1st %arch, &'1$, IEH Bank alone has dis#ursed Rs. $,&&5.07 /roresagainst the target of Rs. $,1&$.&& /rores, there#y achieving 1'$3 of its annual A/!target, which accounts for a lion,s share of 003 of the total flow of credit topriority sector #y all #anks in the state. F (he Road)ap for coverage of 5,52& villages 6having population #elow &,'''8during *Y &'1&+ 1$, &'1$+1., &'1.+15 and #eyond &'15, was for)ulated as per regulatoryre5uire)ents of RB;, which were allocated to five participating #anks, viJ. IEH Bank 6$,&71 villages8, B; 675$

villages8, !unAa# 9ational Bank 6&1.villages8, IEH 7ra)een Bank 61,'&0 villages8 and ?DB 6&$2 villages8. ;tsi)ple)entation is #eing vigorously )onitored #y "ead Bank Depart)ent and over 1'3 of thetarget 61,$1. villages8 set for *Y &'1&+1$ has #een already acco)plished up to $1st %arch,&'1$. %es2onsi0ility of settin, u2 of %3:)Is in ;<= 3tate7 ;n ter)s of %inistry of Rural Develop)ent guidelines, 7overn)ent of ;ndia, setting upthe Rural elf ?)ploy)ent (raining ;nstitutes 6R ?(;s8 in all the districts of IEHstate was assigned #y "ead Bank Depart)entCIEH "B/ to two Banks, viJ. IEH Bankand B;. Accordingly, IEH Bank has already set up 1& R ?(;s in its allocated 1& leaddistricts of rinagar, 7ander#al, Budga), Bara)ulla, Bandipora, Hupwara, Anantnag, Hulga),!ulwa)a, hopian, !oonch and RaAouri. tate Bank of ;ndia has set up nine R ?(;s up to theend of %arch, &'1$ in districts of Ia))u, a)#a, Hathua, Bdha)pur, Reasi, Doda, Ra)#an,Hishtwar and "eh. %es2onsi0ility of settin, u2 of -+$s in ;<= 3tate7 ;n ter)s of RB; guidelines, target of setting of *inancial "iteracy /entres 6*"/s8 inall the districts of the state has #een fully acco)plished with IEH Bankoperationalising 1& *"/s in its 1& allocated lead districts and B; operationalising 1'*"/s in its 1' allocated lead districts. !!> covera,e of farmers under =$$ 3c#eme7 (he initiative of 1''3 coverage of far)ers under H// che)e was launched in IEHstate in ter)s of 7o;, %o* directives. ;ts i)ple)entation is #eing vigorously pursued withall the stakeholders including #anks, Agriculture Depart)ent, "ead District %anagers andso on. (he ti)elines for covering total 1&.2. lacs far)ing fa)ilies in IEH tate has#een e4tended #y 7o; to $'th Iune, &'1$. Bp to the end of %arch, &'1$, 5'3 of the targethas already #een achieved. 7. %e,ional %ural Ban' s2onsored 0y ;<= Ban'7 (he IEH 7ra)een Bank has co)e into e4istence on $'th Iune, &''1, with the issuanceof statutory notification #y 7o;, %o*, Depart)ent of *inancial ervices under su#+section618 of section &$ 6A8 of the Regional Rural Banks Act, 1170 vide *. 9o. 1C.C&''0+RRBproviding for a)alga)ation of Ha)raJ Rural Bank and Ia))u Rural Bank into a single newRegional Rural Bank under the na)e of IEH 7ra)een Bank with its Gead >ffice at Ia))uand has co))enced #usiness fro) '1.'7.&''1. Business (he #usiness of the #ank increased fro) Rs. &,55$.'1 /rores to Rs. $,'&..10 /roresduring *Y &'1&+1$, registering a growth rate of 12..53. De2osits (he deposits of the Bank have increased fro) Rs. 1,275.&1 /rores to Rs. &,105.&& /roresduring *Y &'1&+1$, there#y registering a growth rate of 15..03. Advances (he gross advances of the Bank, as on $1st %arch, &'1$, stood at Rs. 252.1. /rores, asagainst Rs. 077.22 /rores on the corresponding date of the previous year, recording agrowth of &0.7'3. $D %atio (he /D Ratio of the Bank has increased #y $.5&3 fro) $0.1.3, as on $1st %arch, &'1&, to$1.003 as on $1st %arch, &'1$. Priority 3ector Advances (he priority sector advances of the Bank, as on $1st %arch, &'1$, stood at Rs. 0''.5'/rores, as against Rs. .0'.50 /rores on the corresponding date of the previous year,recording a growth of $'.$23. !ortion of advances to the priority sector accounts for01.113 of total advances, )uch

a#ove the #ench)ark of 0'3. NPA Position (he gross 9!As of the Bank, as on $1st %arch, &'1$, stood at Rs. 52.5' /rores,accounting for 0.213 of gross advances. (he 9et 9!A, as on $1st %arch, &'1$, stood at Rs. 15.01 /rores, which accounts for 1.113 of net advances. Profita0ility (he #ank has shown operating profit of Rs. &1.5' /rores, as on $1st %arch, &'1$. 6!re+audit figures8 $B3? $om2uterisation (he Bank has achieved 1''3 /B rollover of its #ranch network. $a2ital to %is'/&ei,#ted Asset %atio (he /RAR position of IEH 7ra)een Bank, as on $1st %arch, &'1$, is 11.0.3, )ucha#ove the )andatory re5uire)ent of 13. Business 2er :m2loyee Business per e)ployee, as on $1st %arch, &'1$, stood as Rs. $.$0 /rores. Profit 2er :m2loyee !rofit per e)ployee, as on $1st %arch, &'1$, stood as Rs. &.$1 lacs. Business 2er Branc# Business per #ranch, as on $1st %arch, &'1$, stood at Rs. 15.'. /rores. Profit 2er Branc# !rofit per #ranch, as on $1st %arch, &'1$, stood at Rs. 1'.01 lacs. 8. -inancial Inclusion (he o#Aective of financial inclusion is to reach out to the large hitherto un#ankedpopulation and e4tend financial services to unlock its growth potential. (he Bankfor)ulated *;! envisaging reaching out to and providing #anking outlets for delivery of#asic #anking services in 1,&0' identified un#anked villages, co)prising 5$5 "B/+allocated a#ove+&,''' population villages and 7&5 other un#anked villages, under aself+set target to #e co)pleted #y the end of %arch, &'1& and &'1$, respectively. Apartfro) a#ove, "B/ has also allocated 1,'1$ villages in the population range of a#ove 1,'''and less than &,''' to #e provided with B/ coverage #y the end of %arch, &'1$. >ut of&,$5$ 61,&0'L1,'1$8 identified and allocated villages, *inancial ;nclusion Depart)ent hasrolled out 1,1&2 villages to B/s for e4tending ;/(+ena#led financial services through theoperation of s)art cards. "B/ has also allocated &,172 villages in the population rangeof #elow 1,''' to #e provided with B/ coverage #y the end of %arch, &'10. (he *;! rolloutis #ased on a )i4 of #ranch network and B/ )odel on engage)ent of / /s #y delivery ofservices through s)art cards. (he Bank has already su#)itted Board+approved *;! to RB; for $,&71 #elow+&,'''population villages to #e covered fro) April, &'1$ to %arch, &'10. -IP Ac#ievements? Pro,ress as on ( st 4arc#6 2! ( F 1,1&2 identified un#anked villages have #een provided with Business/orrespondents 6B/s8, with coverage co)prising .&' self+set target villages, 5&7a#ove+&,''' population villages and 121 #elow+&,''' population villages. F 0&1 Dillage "evel ?ntrepreneurs 6D"?s8 of / /s have #een engaged as B/s and arelinked to $51 #ase #ranchesC#usiness units for providing ;/(+ena#led financial services. F 1.'1 lac accounts have #een opened in 1,1&2 villages, co)prising ..01 lacno+frillsCsaving #ank

deposits accounts and ...2 lac other accounts. F Gousehold coverage has reached 5..0'3 in 1,1&2 rolled out villages. F 1.5$ lac )art /ards have #een delivered to concerned #usiness units for #eingena#led for operations F !oint of (ransaction 6!o(8 devices have #een deployed at B/s and #usiness unitsas ter)inals to facilitate s)art card transactions. %BI ado2ted model @illa,es 8Pro,ress? Ac#ievements9 F 15 )odel villages selected #y RB; for 1''3 financial inclusion in the state have#een allocated to IEH Bank, which are operational and transactions are taking placethrough the operation of s)art cards. F .,211 s)art cards have #een issued in 15 RB;+selected villages. . :B)?I333? N*AP? 4GN%:GA F (he Bank has initiated the process of #ringing ; C %79R?7A account holders inthe a)#it of ?B( under e+governance progra))e and provided the) facility of availing;/(+ena#led financial services. F ?nrol)ent process for delivery of #anking services to ; C 9>A!C %79R?7A#eneficiaries through the )icro products under financial inclusion is underway. 2. -inancial +iteracy cum $redit counsellin, centres F ;n co)pliance to RB; Directive, IEH "B/ has assigned setting up of *"/s in1& lead districts of the state. (he Bank has appointed financial literacy facilitators andall the *"/s have #een )ade operational in the allocated lead districts of the #ank in thestate. $57 outdoor financial literacy ca)ps have #een conducted in the lead districts and.1,771 persons have attended the ca)ps. 9. $or2orate Governance IEH Bank has esta#lished a tradition of e4e)plary practices in corporategovernance. ;t enco)passes not only regulatory and legal re5uire)ents, #ut also severalvoluntary practices, ai)ed at a high level of #usiness ethics, effective supervision andenhance)ent of stakeholder value. everal )atters have #een voluntarily included in the state)ent on corporate governanceanne4ed to this report, #esides certificate fro) the /entral tatutory Auditors regardingco)pliance of conditions of /orporate 7overnance as stipulated in /lause .1 of the "istingAgree)ent. 2!. Board of Directors F %r. %oha))ad ;5#al Hhanday, !rincipal ecretary to 7ovt. *inance Depart)ent, wasno)inated #y the 7overn)ent of IEH as Director on the Board of the Bank with effectfro) 2th Iuly, &'1& and was recalled #y the tate 7overn)ent of IEH with effect fro)&$rd April, &'1$. F %r. %. ;. hahdad and %r. Dikrant Huthiala, were reappointed as Directors at thelast Annual 7eneral %eeting of the hareholders of the Bank held on 1..'7.&'1&. F @ith a view to #road+#asing the Board, %r. 9ihal /. 7arware, an e)inentpersonality, was reappointed as Additional Director of the Bank w.e.f 10.'7.&'1&. (he Bankhas gained i))ensely fro) his guidance and wide ranging e4perience and e4pertise. F %r. A. %. %atto and !rof. 9isar Ali retire #y rotation at the ensuing Annual7eneral %eeting, in accordance with Article 70 of the Articles of Association of the Bankand provisions of /o)panies Act, 1150, and are eligi#le for reappoint)ent.

2 . Name of t#e Board of Directors of t#e Ban' 1. %r. %ushta5 Ah)ad /hair)an E /?> &. %r. Gari 9arayan ;yer Director $. %r. %. ;. hahdad Director .. %r. Dikrant Huthiala Director 5. !rof. 9isar Ali Director 0. %r. A. %. %atto Director 7. %r. R. H. 7upta Director 2. %r. 9ihal /. 7arware Director 22. Directors %es2onsi0ility 3tatement (he Board of Directors here#y confir)s that1. ;n the preparation of the annual accounts, the applica#le accounting standards have#een followed, along with proper e4planation relating to )aterial departures. &. @e have selected such accounting policies and applied the) consistently and )adeAudg)ents and esti)ates that are reasona#le and prudent to give a true and fair view ofthe state of affairs of the /o)pany at the end of the financial year and the profitClossfor the period under report. $. @e have taken proper and sufficient care for the )aintenance of ade5uate accountingrecords in accordance with the provisions of the /o)panies Act, 1150, for safeguarding theassets of the /o)pany and for preventing and detecting frauds and other irregularities. .. @e have prepared the annual accounts on a going concern #asis. 2(. Particulars of :m2loyees !articulars of e)ployees as per section &176&a8 of the co)panies act, 1150, read withthe co)panies 6particulars of e)ployees8 rules, 1175, for the year ended $1st %arch, &'1$,are as under1. ?)ployed throughout the financial year and in receipt of re)uneration aggregatingRs. 0','','''C+ or )ore per annu) +ast em2loy %emunera Date of ment Name Desi,nat Nature A,e of tion :B2erie commence #eld 3. of ion? of Aualifica em2lo received nce in ment t#e of 0efore No :m2lo Nature em2loy tion yee 8%s. In year em2loyme 5oinin, yee of Duties ment 8years9 lacs9 nt t#e $om2an y 4r. ;n whole /hair)an 4us#t ti)e IEH E /hief B.A. aC 0' e)ploy) .' years '0+1'+&'1' 0$ Bank ?4ecutiv /A;;B+; A#ma ent of the "td. e >fficer d Bank &. ?)ployed for part of the financial year and in receipt of re)uneration aggregatingRs. 5,'','''C+ or )ore per )onth + nil. 21. Ac'no&led,ements

a. (he Directors thank the valued custo)ers, shareholders, well+wishers andcorrespondents of the Bank in ;ndia and a#road for their goodwill, patronage and support. #. (he Directors acknowledge with gratitude the valua#le and ti)ely advice, guidanceand support received fro) 7overn)ent of ;ndia, 7overn)ent of Ia))u E Hash)ir, ReserveBank of ;ndia, ecurities and ?4change Board of ;ndia 6 ?B;8, ;nsurance RegulatoryDevelop)ental Authority 6;RDA8, 9ABARD, ;DB;, ;BA, *;%%DA, *?DA;, tock ?4changes, Dept.of /o)pany Affairs, Registrar of /o)panies, /o)ptroller E Auditor 7eneral, *inancial;nstitutions and the /entral tatutory Auditors of the Bank in the functioning of theBank. c. (he Directors place on record their deep appreciation of the valua#le contri#utionof the )e)#ers of the staff at all levels for the progress of the Bank during the year andlook forward to their continued cooperation in realisation of the corporate goals in theyears ahead. *or and on #ehalf of the Board of Directors 4us#taC A#mad /hair)an E /?> !lace- rinagar 6IEH8 Date- 15th %ay, &'1$