2. PROJECT FINANCING Project finance is the financing of long-term infrastructure and industrial projects based upon a complex financial structure where project debt and equity are used to finance the project. Project financing scheme involves a number of equity investors, known as sponsors, as well as a syndicate of banks which provide loans to the operation. The loans are most commonly non-recourse loans, which are secured by the project itself and paid entirely from its cash flow, rather than from the general assets or creditworthiness of the project sponsors. The financing is typically secured by all of the project assets, including the revenue-producing contracts. Project lenders are given a lien on all of these assets, and are able to assume control of a project if the project company has difficulties complying with the loan terms. Generally, a special purpose entity is created for each project, thereby shielding other assets owned by a project sponsor from the detrimental effects of a project failure. As a special purpose entity, the project company has no assets other than the project. Capital contribution commitments by the owners of the project company are sometimes necessary to ensure that the project is financially sound. Project finance is often more complicated than alternative financing methods. It is most commonly used in the mining, transportation, telecommunication and public utility industries.
3. ABOUT THE BANK HISTORY OF J&K BANK The Jammu & Kashmir Bank was founded on October 1 1938 under letters patent issued by the Maharaja of Kashmir, Hari Singh. The Maharaja invited eminent Kashmiri investors to become founding directors and shareholders of the bank, the most notable of which were Abdul Aziz Mantoo, Pesten Gee and the Bhaghat Family, all of whom acquired major shareholdings. The Bank commenced business on July 4, 1939 and was considered the first of its nature and composition as a State owned bank in the country. The Bank was established as a semi-State Bank with participation in capital by State and the public under the control of State Government. The bank had to face serious problems at the time of independence when out of its total of Ten branches two branches of Muzaffarabad, Rawalakot and Mirpur fell to the other side of the line of control (now Azad Kashmir) along with cash and other assets. Following the extension of Central laws to the state of Jammu & Kashmir, the bank was defined as a government company as per the provisions of Indian companies act 1956
4. PRODUCT OR SERVICE OFFER J&K BANK PERSONAL LOAN J &K BANK HOUSING LOAN J&K BANK CAR LOAN J &K BANK EDUCATION LOAN J &K BANK INDUSTRIAL LOAN AND ALL OTHER LOANS
5. Mission of J&K Bank: “To catalyze economic transformation and capitalize on growth.” The bank aspires to make Jammu & Kashmir the most prosperous state in the country, by helping create a new financial architecture for the J&K economy, at the center of which will be the J&K. Vision of J&K Bank: To provide the people of J&K international quality financial service and solutions and to be a super-specialist bank in the rest of the country.
6. PERFORMANCE OF THE BANK The Bank’s aggregate business crossed yet another psychological mark and stood at Rs. 70,869.57 Croresat the end of the financial year 2010-11. The Bank’s total business increased by Rs. 10,575.18 Croresfrom the previous year’s figure of Rs 60,294.39 Crores, registering a growth of 17.54%. The core segments of Bank’s business viz. Deposits, Advances, Foreign Exchange and Treasury Operations recorded an impressive growth. The Bank registered highest ever Net Profit of Rs. 615.20 Croresfor the financial year 2010-11 compared to Rs. 512.38 Croresfor the financial year 2009-10, registering 20.07% surge. The Return on Average Net Worth, Earnings per Share and Book Value per Share for the financial year 2010-11 stood at 18.96%, Rs. 126.9/- and Rs. 717.58/- , against 18.19%, ` 105.69 and ` 621/- respectively for the previous year.
7. SCOPE OF THE PROJECT Company has given various guidelines, advice and projection for obtaining the finance from the banks and other financial services. And developing of the company keeping in the view economic of the country. I have under taken the study of fast developing company with reference to its financial position. It is necessary to under taken the impact of “ANY OTHER COMPANY” & various services provide to their clients.
8. OBJECTIVES OF THE PROJECT To analyse the market strategies adopted by the bank. To know & understanding the banking monetary system and how the bank sanction the loan. To find out the right projection of the company.
9. RESEARCH METHODLOGY The most of important part and main strength of project comes from the process of collecting; classification and analyzing work will depend upon the methodology. It is in a way proposed plan of the study. SOURCE OF DATA COLLECTION: Data Collection is key part of project work. There are two types of data collection, first is primary source and second is secondary of data collection. PRIMARY DATA: The primary data includes company profile, financial statements, and case study has been obtained from Sharma paper limited company’s financial services. SECONDARY DATA: The primary data includes company profile, financial statements, and case study has been obtained from Sharma paper limited company’s financial services. SAMPLE SIZE: 40 and different question have different sample size.
10. DATA ANALYSIS AND INTERPREATION NAME OF THE BANKS AND NO.OF BRANCHES OPERATING IN DISTRICT SRINAGAR. J & K BANK : 29 SBI BANK : 5 PNB BANK: 4 COOPERATIVE BANK : 4 CANARA BANK: 3 HDFC BANK: 5
11. Q.1 How many loans you have given during the current financial year The above graph shows that JK Bank is the only bank in the district which has provided more than half of the total loans in the district. SBI is the second one and PNB is the third one in providing the loans in the district Srinagar.
12. Q.2 DO YOUR CUSTOMER REGULARLY PAY THE LOAN INSTALLMENT OR NOT? SAMPLE SIZE= 40
13. Q.3 HOW MANY NUMBERS OF DEFAULTERS CASES YOUR BANKS HAS FACES DURING THE CURRENT FINANCIAL YEARS?
14. INTERPREATION The above graph shows that J & K Bank is leading in case of default cases with total no. of default cases equal to 40 during the current financial year, then the second leading one among default cases is PNB Bank with total no. equal to 12, the third being the SBI &COOPERATIVE with total no. of default cases equal to 10, then CANARA Bank equal to 11 . HDFC is the bank with total no. of default cases equal to 9
15. Q.4 HOW MUCH TIMES DOES YOUR BANK GIVES TO DEFAULT CUSTOMERS TO TAKE OVER THEIR MORTGAGE? The above graph shows that all the banks give 2-4 years for their default customers to take their mortgage. The Canara bank gives only one year for their default customers to take their mortgage.
16. Q.6 WHEATHER YOUR BANK CHARGE INCREASED OR DECREASED RATE OF INTEREST TO THE DEFAULTER? SAMPLE SIZE=7 Out of the seven respondents five of them said that they decrease the interest rate to their default customers while as two of the respondents said that they increase the interest rate. The decreasing rate are mainly charged by the Kamraz Rural Bank
17. -CREDIT SURVEY OF J&K BANK The J & K Bank is the only bank in the Srinagar town which has more than fifty percent of the credit share in the town. The bank has about 77.7 % of the total credit in the market. Every shop of the town is banked with the J&K Bank whether it is the local manufacturing unit or the distributing unit or whether it is the local vegetable grower or the local fruit grower .The J&K Bank has almost covered the entire Srinagar district with a small portion Remaining aside. The different sections in which J&K Bank has provided loans include term loans, housing loans, trade loans, industry loans, tourism loans, agriculture loans, transport loans, educational loans and other loans. The total credit of the bank in the Srinagar town is about 70,869.57 crores which are distributed in the different economic sectors of the town. The weight age of the different credits in different sectors is given in the graph below.
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19. FINDINGS During the survey of the town the main findings are as under- The J&K bank is the only bank in the state having about more than one third of the total credit share in the town. In other words we can say J&K bank is having monopoly in the town Education has not been properly served by any bank of the district Some people are in confusion over the interest rates of the credit provided to them by the different bank
20. SUGGESTIONS Education should be given prompt attention and new schemes should be developed for this purpose People should be informed about the new schemes of the JK bank so that maximum profit can be generated by using these schemes by a customer.
21. LIMITATIONS Data collection was strictly confined to secondary source thus is subject to slight variation than what the study includes in reality There were various technical terms used in the project, which were difficult to understand
22. BIBLIOGRAPHY NAME OF THE BOOKS REFER FINANCIAL MANAGEMENT , AUTHOR I.M PANDAY, VIKAS PUBLISHING HOUSUNG LTD FINANCIAL MANAGEMENT, AOTHOR M.Y.KHAN AND P.K. JAIN, PUBLISHING TATA MCGRAW HILL CO .LTD. Source of information: http://www.mcmullan.net/eclj/BOT.html www.worldbank.org WWW.GOOGLE .COM
