Financial Ratio Analysis ..Very useful to get knowledge

 Financial Ratio Analysis

In credit proposals, Ratio analysis plays a significant role in analysing the financial health of units. Structuring the ratios in a proper manner not only results in gauging the performance of the unit, but also in analysing its exact financial needs.

let us understand various Profitability ratios along with rationales.
1. Operating Profit / Net Sales (%):
This ratio gives clue about the profitability of the unit from its core operations.
Rationale: It is to understand whether profitability reported by the unit is on account of its core operations or from non operating income.
2. Profit Before Tax (PBT) / Net Sales (%):
Indicates Profitability levels. It gives an indication regarding percentage of profit reported by the unit out of total income in a particular financial year
Formula for PBT: Net Sales (-) Operating expenses (-) Interest (+) Non operating income (-) Non operating expenditure.
For example, if PBT is Rs 10/- out of net sales of Rs 100/-, then the unit has a profitability of 10% in its business.
Rationale: PBT is arrived after considering Non operating income and Non operating expenditure. It is to understand whether profitability reported by the unit is on account of its core operations or from non core operations.
3. Operating cost to sales:
Operating cost is sum total of expenditure incurred from the stage of raw materials purchased to selling, General and administration expenses.
Rationale: This ratio is important in understanding the total amount of cost involved out of per unit sale. For example, an Operating cost to sales of 0.75 indicates, that the unit is incurring an amount of Rs 75/- in the form of operating costs while generating a revenue of Rs 100/-
4. Long Term Loans /Earning Before Interest, Depreciation, Taxation and Amortization (EBIDTA):
It indicates the comfortable level of EBIDTA to take care of term loan repayment obligations.
Rationale:Lower the ratio, greater is the comfort. If the ratio is low, it indicates that unit is not excessively indebted and is able to fulfil its debt obligations. Conversely, if the ratio is high, it indicates that company is heavily burdened with debt.
5. Interest Coverage Ratio (ICR) = Profit before Depreciation, Interest and Tax (PBDIT) / Interest):
It determines the cushion available in the hands of the unit out of surplus generated from its operations to pay interest on its outstanding debt. This ratio explains the sufficiency of available funds (PBDIT) in the hands of the unit to take care of interest obligations.
Rationale: This signifies that the unit has to generate sufficient income to meet its interest obligations, even when the business prospects are adverse.
A lower ICR indicates that less operating profits are available to meet interest payments and that the unit is more vulnerable to volatile interest rates. Therefore, a higher interest coverage ratio is desirable which indicates stronger financial health.
6. Return on Equity (ROE) %:
ROE is calculated as a ratio of net profit to the equity. It indicates what is the percentage of return, the equity share holders are deriving from their investment made in the business.
Rationale: ROE represents the capacity of the unit to serve its equity holders. Higher the level, higher is the return derived by share holders.
7. Debt Service Coverage Ratio (DSCR):
‘Debt’ means maturing term obligation within a year viz., instalment repayable during a year under all term loans/deferred payment guarantees and ‘service’ means cash accruals consisting of net profit plus depreciation and non-cash expenses written off.
This ratio has to be calculated for the entire tenor of term loan. While calculating DSCR, existing term loan and its repayment should also be considered along with proposed term loan. Apart from this, any other term loan sanctioned by any other financial institution should also be considered.
Gross DSCR = [PAT + Depreciation and other non cash expenses** + Interest on term loan] / [Annual Principal instalments + Interest on term loan]
Net DSCR = [PAT + Depreciation and other non cash expenses**] / [Annual Principal instalments]
** Amortization, unrealized gains, unrealized losses etc.
Average Gross DSCR: It is calculated by dividing sum total of cash + Interest on term loan for the entire period of term loan with sum total of Annual Principal instalments + Interest on term loan for the entire period of term loan.
Rationale: DSCR is most important, as it indicates the ability of an enterprise to meet the liabilities (by way of instalments of Term Loans and Interest) out of cash accruals generated and forms the basis to fix repayment schedule in respect of the Term Loans sanctioned

TIME MANAGEMENT..Nice Article

 TIME MANAGEMENT

Many of us claim our days are never wasted. "I'm very organised" we say, "I know where I
am going and what I'm going to do". If you truly feel that way then you are in the minority.
Most people become frustrated with a day that is unproductive. We would all like to get more
done in a day.
The idea of time management has been in existence for more than 100 years. Unfortunately
the term "Time management" creates a false impression of what a person is able to do. Time
can't be managed, time is uncontrollable we can only manage ourselves and our use of time.
Time management is actually self-management. It’s interesting that the skills we need to
manage others are the same skills we need to manage ourselves: the ability to plan, delegate,
organise, direct and control
There are common time wasters, which need to be identified. In order for a time
management process to work it is important to know what aspects of our personal
management need to be improved. Below you will find some of the most frequent reasons for
reducing effectiveness in the workplace. Tick the ones which are causing to be the major
obstacles to your own time management. These we refer to as your "Time Stealers".
Identifying your time stealers
 Interruptions - telephone
 Interruptions - personal visitors
 Meetings
 Tasks you should have delegated
 Procrastination and indecision
 Acting with incomplete information
 Dealing with team members
 Crisis management (fire fighting)
 Unclear communication
 Inadequate technical knowledge
 Unclear objectives and priorities
 Lack of planning
 Stress and fatigue
 Inability to say "No"
 Desk management and personal disorganisation

Fortunately there are strategies you can use to manage your time, be more in control and
reduce stress, but you can analyse your time and see how you may be both the cause and the
solution to your time challenges.
Below, we examine time management issues in more detail
1. Shifting priorities and crisis management.
Management guru Peter Drucker says that "crisis management is actually the form of
management preferred by most managers" The irony is that actions taken prior to the crisis
could have prevented the fire in the first place.
2. The telephone.
Have you ever had one of those days when you thought your true calling was in
Telemarketing. The telephone-our greatest communication tool can be our biggest enemy to
effectiveness if you don't know how to control its hold over you.
3.Lack of priorities/objectives.
This probably the biggest/ most important time waster. It affects all we do both professionally
and personally. Those who accomplish the most in a day know exactly what they want to
accomplish. Unfortunately too many of us think that goals and objectives are yearly things and
not daily considerations. This results in too much time spent on the minor things and not on
the things, which are important to our work/lives
4. Attempting too much.
Many people today feel that they have to accomplish everything yesterday and don't give
themselves enough time to do things properly. This leads only to half finished projects and no
feeling of achievement.
5. Drop in visitors.
The five deadliest words that rob your time are "Have you got a minute". Everyone's the
culprit-colleagues., the boss, your peers. Knowing how to deal with interruptions is one of the
best skills you can learn .
6. Ineffective delegation.
Good delegation is considered a key skill in both managers and leaders. The best managers
have an ability to delegate work to staff and ensure it is done correctly. This is probably the
best way of building a team’s moral and reducing your workload at the same time. The
general rule is -this; if one of your staff can do it 80% as well as you can, then delegate it.
7. The cluttered desk.
When you have finished reading this article look at your desk. If you can see less than 80% of it
then you are probably suffering from 'desk stress'. The most effective people work from clear
desks.
8.Procrastination.
The biggest thief of time; not decision making but decision avoidance. By reducing the amount
of procrastinating you do you can substantially increase the amount of active time available to
you.
9. The inability to say "no!”
The general rule is; if people can dump their work or problems on to your shoulders they will
do it . Some of the most stressed people around lack the skill to 'just say no' for fear of
upsetting people.
Meetings.
Studies have shown that the average manager spends about 17 hours a week in meetings
and about 6 hours in the planning time and untold hours in the follow up. I recently spoke to
an executive who has had in the last 3 months 250 meetings It is widely acknowledged that
about as much of a third of the time spent in meetings is wasted due to poor meeting
management and lack of planning If you remember your goal is to increase your self
management, these are the best ways to achieve this;
There are many ways we can manage our time. We have listed some strategies you can use
to manage your time.
1. Always define your objectives as clearly as possible.
Do you find you are not doing what you want because your goals have not been set. One of
the factors, which mark out successful people, is their ability to work out what they want to
achieve and have written goals, which they can review them constantly. Your long term goals
should impact on your daily activities and be included on your "to do" list. Without a goal or
objective people tend to just drift personally and professionally
2. Analyse your use of time.
Are you spending enough time on the projects, which although may not be urgent now are
the things you need to do to develop yourself or your career. If you are constantly asking
yourself "What is the most important use of my time, right now?" it will help you to focus on
'important tasks' and stop reacting to tasks which seem urgent (or pleasant to do) but carry
no importance towards your goals.
3. Have a plan.
How can you achieve your goals without a plan. Most people know what they want but have
no plan to achieve it except by sheer hard work. Your yearly plan should be reviewed daily
and reset as your achievements are met. Successful people make lists constantly. It enables
them to stay on top of priorities and enable them to remain flexible to changing priorities. This
should be done for both personal and business goals.
4. Action plan analysis.
Problems will always occur, the value of a good plan is to identify them early and seek out
solutions. Good time management enables you to measure the progress towards your goals
because "What you can measure, you can control". Always try to be proactive.
Time management (or self management) is not a hard subject to understand, but unless you
are committed to build time management techniques into your daily routine you'll only achieve
partial (or no) results and then make comments such as "I tried time management once and it
doesn't work for me". The lesson to learn is that the more time we spend planning our time
and activities the more time we will have for those activities. By setting goals and eliminating
time wasters and doing this everyday you may find you will have extra time in the week to
spend on those people and activities most important to you.




The Eleven Biggest Time Management Lies !!


In the world of Time Management there are things said to us that we Accept as truth and we act
accordingly. The problem is sometimes they Are not truths. They are lies and as we believe
them, they waste our Time.
Those who speak these lies to us are not bad people at all because You and I are among them.
We all speak these untruths to one another from time to time. So let's not wish harm and doom
to the liars. Let's avoid the time traps their lying may cause us.
Here are the eleven biggest lies to shield yourself from.
1. "This will just take a minute." Has anyone grabbed you with that line? Does it ever "just take a
minute"? Rarely. What typically "just takes a minute", generally consumes several minutes and
more. Next time, when someone asks for your time and assures you," This will just take a
minute", tell them, "You're lying. You may not realize you're lying, but you are. I'll give you five
minutes. You may begin now."
2. "I need this as soon as possible." No you don't. That's a lie too. you need it by a certain date
and time because you are going to do something with what I provide for you. And if you're not
going to do anything with what I provide for you, why am I doing it for you in the first place?
Don't lie to me. Tell me when I have to get it to you. Be specific. You and I probably have two
difference dates in mind when we think in terms of "as soon as possible".

3. "I want this now." I doubt it. In this 24/7/365 world, everyone is under a sense of artificial
pressure to get it done "now" or worse," Yesterday". Things are generally not that urgent. Don't
get caught up in someone else's urgent trivialities. Call the liar to task. "I'm not sure I can get
that done now. What if I got it to you one week from today?" Use an outside deadline to give
yourself ample time to prevent getting into crisis management. Oh, and if they reject that
alternative, try three better dates for you. Why? Because, they may keep lying to you.
4. "It's not about the money." When it's not about the money, it's about the money.
5. "This is the best (investment, business opportunity, book, movie, restaurant, boss, job, etc.)
you'll ever find." Not true. There's always something better. The best is yet to come.
6. "I can get this done in an hour." It's a fib. Ever notice how it almost always takes twice as long
to get something done as what you thought it would? That's because few of us have a very
accurate internal clock to estimate the time required to complete most tasks.
7. "He's a' late' person." Most people who are "late" have a consistency about their behavior. My
friend Dwayne is 20 minutes late all the time. If we need to meet for lunch tomorrow, it will take
him 24 hours and twenty minutes to get there. Dwayne is not "late". He's "On-time; 20 minutes
later".
8."No Cost." You don't get "nothing for nothing". Everything has a cost. It may not cost you your
money but more often it will be your time and more of it than what you are getting in return for
"no cost".
9. "I'll prove you're wrong if it's the last thing I do." And it may well be. No one wants to be
proven wrong. Everyone likes to be caught doing things "right". Most, however, don't mind being
shown how to do things better.
10. "By the time I show him how to do it I could just as quickly have done it myself." If it's a onetime
proposition this may be true. It doesn't make a lot of sense to spend an hour to show
someone how to do a task that takes only 10 minutes.
But if it's a repetitive task, it's a lie. If that one hour investment will save you 10 minutes every
day, then in about a week you have your investment back and now you have a dividend of 10
extra minutes a day. What if you do that six different times? You get an extra hour in your day
and 365 hours over the next year.
11. "This is going to be really hard." Not true. Going through whatever you have to go through is
almost never as difficult as you imagined It to be. My high school principal, taught me that 95%
of what we fear coming at us will never hit us. It will ditch itself before it ever reaches us. And as
to the remaining 5%, tap your inner strengths to deal with it.

Do’s of Time Management


1) Draw out clear KPAs, time bound objectives and detailed plans for your job.
2) Plan your day ahead. List out the most important things to be done the next day in order
of importance.
3) Do delegate matters which you do not have to decide yourself. Insist on exercise of
delegated authority.
4) Be predictable. Know your staff and let your staff know your mind.
5) Record occasionally for some stretch of time how you spend your time and analyse
critically your time management.
6) Do accept that whatever your superior wants is urgent and important (till you are able to
convince him that it is not really so). But as a superior, decide priorities with reference to
organisational needs.
7) Do set aside fixed hours in a day when your staff can meet you or you will call them,
other than in any emergency.
8) Do set aside some time a week for innovative thinking and long range planning
regarding your area of responsibility, so as to anticipate problems and heighten your
contribution to the organisation.
9) Set aside some time, preferably towards the end of the day for trivial administrative
details.
10) Insist on completed staff work.
11) Finish the task you have taken up before getting to another.
12) Develop the habit of single handling i.e., making a decision or disposing of a paper at the
first opportunity itself.
13) Manage your time as you manage your money.
14) Do find time to relax, to draw back and look at what you are / have been doing (Review
time)
The trouble with service delivery is that it can’t be checked in advance, like a piece of crystal, or
a luxury car. We can’t sample it, package it, systemize it or automate service. It’s only produced
at the moment of consumption, our win-or-lose moment. That service delivery is often
performed by the most junior of our employees, often least motivated.
-- John Sharpe

Distress to De-Stress

 WHAT IS STRESS  ?

STRESS

 Is a reaction / Response to any kind of change

 Is physical and emotional responses to situations which are perceived as novel, frightening, confusing, exciting, or tiring.

 Gets precipitated by external demands

 Can also be generated from with in by our fears, hopes, expectations and beliefs

 Acts like a signal for body and mind to get ready to rise to an occasion.  It is an alarming reaction.

 Can’t be avoided.  It is every day fact of life.

 Creeps in stealthily and has potential to either make or mar us.

 Affects our mood and behaviour.

 Produces tension and pressure on bodily systems.

 Accelerates aging process.

 Reduces immunity to illness.

 Final effect may be serious illness of body or mind or even death.


So what? Is all the stress bad?

Good verses bad stress

 No, all stress is  not  Bad.

 It can be positive or Negative.

 Positive situations like, promotion, a new job, marriage prove to be stressful but these increase our resistance to stress on account of positive feelings like pleasure, confidence, and happiness generated by them.

 Negative situations like illness, interpersonal problems, financial losses, death of family members having been associated with negative feelings, like sadness, conflict, dissatisfaction lower our resistance to stress and make us more vulnerable to diseases.

 A certain amount of stress is essential for health, and to stimulate us to do simple day to day tasks.  Absence of stress in life makes our lives monotonous and dull.

 More and more negative situations, in quick succession and negative perceptions about our existing conditions make it difficult to adjust or adapt.  Then we feel anxiety, tension, worry and uneasiness.  At this state good effects of ‘positive stress’ in our lives are over powered, by effects of negative stress.  We start imaging all bad things that are likely to happen in our lives.  We drive our elves to illness.

 So, let us develop our capabilities to utilize good stress to our advantage and to prevent bad stress from spoiling our lives.

ROLE OF PERSONALITY FACTORS AND BEHAVIOURAL PATTERNS:

Every one responds differently to a potentially stressful situation.  It is not only the outside stressor alone that causes stress, but also our response to that stressor.  Let us note here that ‘what happens to us is not important, but how er react to what happens to us that is important.

Some PERSONALITIES SUSCEPTIBLE TO STRESS are
a) Suspicious :
Hyper vigilant, guarded, cold and unemotional by nature, uneasy in social interactions.  He causes stress to himself and also to those who deal with him.

b) Asocial  : Eccentric, isolated, lonely , aloof and uninvolved, lacks concern for others, engages excessively in day dreaming, lack of expression of appropriate anger, Introvert.  For him performing day to day functions is of too much burden.  It is difficult to handle such person at work and in house.

c) Volatile : Excitable, emotional, extrovert maintains deep long lasting attachments.  Highly demanding in inter personal relations, irrational behaviour, angry out bursts under stress.  Uncontrolled emotionality is stressful to him and those around him.

d) Antisocial : In conflict with acceptable social norms, rules, regulations, constant marital tensions, repeated physical fights, wife or child abuse, very unpopular, repeated lieing, drunk driving offenses appears stressful and hardy, underlying stress and frustration takes form of aggressive and antisocial behaviour.

e) Hypersensitive : Extreme sensitivity to rejection, socially withdrawn, low self esteem lack of self confidence, seeks jobs on the side lines, shy and eager to please others, creates stress in interpersonal relations.  These are handle with care variety.

f) Inadequate : Loves to sit back and enjoy life, passive.  Pessimistic, fearful about expressing fearful and aggressive feelings, avoids positions of responsibility, anxious and stressful to face responsibility.  Indecisive cause great stress to other family members.

g) Obsessive : Stubborn, insists on things being done in ways and suggested by them, preoccupied with order and detail, serious, formal, highly stressful to others.

h) Passive : Procrastinate, justifying their unreasonable behaviour , lacks assertiveness, critical of those on whom they depend on, don’t directly state needs, confused are mostly under stress.


Thus, personality determines how we perceive life events, how we behave in responsive to stress encounters and how quickly and how easily we handle stress.

STRESS PERSONALITY – ILLNESS

Understanding personality types help us to modify our behaviour patterns in order to relieve stress symptoms and thereby prevent related illness.

Type A:  Ambitious, impatient, competitive, always struggle to achieve, irritable and annoyed if any thing gets in their way.

Those who don’t show above characters are type ‘B’.

None of the above two types is type ‘B’

Type A is more prone to heart attack and other heart related problems / disorders.  In case of loss of control over SITUATIONS ‘A’ type falls into state of collapse.

Cancer Prone : Severe emotional disturbances before 15 years as children felt sense of loss, loneliness, anxiety, rejection, try to please people to win their affection.


Migraine prone : Feels sense of unworthiness, accepts greater burden than they can cope, easily given to frustration, sudden outbursts of anger, poor judgment.


Other uncertain, qualities : concerned above neatness, morality, conformity, can’t express anger / hostility.  Therefore, facts are given not to threaten readers, but to encourage them to take positive preventive action to deal with stress.

Not only personality facts, but also a host of other factors also determine stress to individual.  We may not be able to change stress situations or our genetic inherent characters but, we can change our reactions to stress and how we perceive it.


STRESSORS

Life events cause stress.  No. of life events in particular period of time can lead to increased ill health.


These are birth, death, marriage, divorce, job, retirement, moving house  But what is important is how often we experience them.  All of them need social readjustment to a new change.


Greater the amount of readjustment required, greater the likelihood of developing illness.  Loss events like death or loss of job cause more stress induced illness than gain events like birth or new job.  In addition to daily events our beliefs and attitudes, unrealistic expectations and negative self-talk lead us to stress.


The stressors can be classified as Domestic, occupational and social


Domestic : Marriage, children divorce
Occupational : Physical environment, job structure, Interpersonal relations, Burnout unemployment, Role o f working  women.


Socio-economic : Tax problems communal tension, over population, strikes etc come under political stress.

HOW TO RECOGNIZE STRESS


The body has its own ways of signaling that it is in discomfort.  Whenever it is subjected to prolonged stress.  Presence of symptoms is suggestive of the fact that some thing has gone wrong some where in body.

But, some people are so externally oriented that they are not aware of their own feelings.  Until and unless we recognize our sysmptoms of stress, we can’t prevent/minimize them.  Let us try to recognize “BAD STRESS SYMPTOMS” are:

Mental :  Increased irritability and angry out bursts.  Lack of concentration, Indecisiveness, Forget fullness.

Emotional : Becoming fussy, suspicious, touchy or weepy, feeling anxious, hopelessness, guilty, insecure, increased moodiness.

Physical : Tense muscles, irregular breathing sweaty palms, cold fingers dryness of mouth, palpitations, Diarrhea.  More urination, Restlessness, shaky hands / legs.

Behavioural : Increased smoking, drinking, increased/decreased eating, sleep, nail biting, hair pulling, not mixing with others, neglecting looks, tapping fingers, lipsmacks, mannerisms, non stop talking, workholism/absenteeism.



Recognizing these symptoms and having appropriate timely intervention can prevent us from falling prey to severe stress related disorders/illness.

HEALTH CONSEQUENCES OF STRESS

Reaction to stress occurs in four ways

Normal : Alertness followed by action of defense
Neurotic : Alert/anxiety is so great, that defense becomes ineffective.
Psychotic : Alert is mis-interpreted or ignored.

Psychosomatic : Defense by mind fails, alert is transmitted to bodily system causing changes in body tissues and leading to several health problem as shown here under:

Prolonged alertness / tension / stress can produce physiological  disorders, which includes, tension headache,back ache, migraine and triggers off asthma, eczema, arthristis, palpitations indigestion, diarrhea, constipation, disturbed sleep.


 It can also increase our succeptability to High Bold Pressure, Heart disease, Diabetes or Cancer.  Even though, certain level of stress is needed in the life, but prolonged pervasiveness and high level of stress can ruin our physical as well mental Health.



So, recognize early signs symptoms and timely intervention can prevent future health hazards.


How to prevent / overcome?

COPING WITH STRESS

Stress is inescapable.  So, it should be maintained in manageable levels.  For this, every one develop his own strategies… coping is nothing but think strategies to handle stress.  Coping with stress means the ways and means to be adopted to keep stress in manageable levels.  For managing the stress, we shall bring CHANGE in 3 areas of ourlife.  Self, others environment.

Some people try to choose to cope with stress NEGATIVELY.  It is not good in long run.  In negative coping one tries to manage or control stress by using methods, which on surface appear to be worthwhile efforts, but in reality only further add to increase stress levels in imperceptible ways.  Negative coping strategies are smoking, Drinking too much coffee, alcohol, tranquilizers, eating too much, too little food.  These habits rob away the resources from the body, which has already been stressed much.  Managing stress is more than coping it is learning to cope adaptively, effectively.

POSITIVE COPING STRATEGIES includes

Nutrition : Healthy habits and supplementing body with vitamins/foods rich in vitamins like B complex, C and E protect body from stress.
Relationship : Developing meaningful relationship with others reduces stress.
Diversion : Theater, T.V.  Amusement parks, provide a source of joy and entertainment and help us to tackle our problems in positive frame of mind.  But diversion is a temporary escape from stress.

Removal : Temporarily getting away from stress situation resorts/beaches, gurus, Religious organizations.  They  give needed Relaxation, sleep and re-change body to meet stress situation again.  But it fades away again after sometime of our facing stress situation.  But his can’t give any direct solution.
Selecting a few of the techniques, which are most suitable to us land practicing them daily can give us direct solution to our stress.


WHAT ARE OTHER TECHNIQUES
Mental techniques

Breathing : There is direct relationship between mind and breathing.  Out of the chest breathing and abdominal breathing, the later one is most efficient type as it enhances greater expansion and ventilation of lungs.  Increases circulation and increases mental and physical relaxation.
The abdominal breathing also called as Diaphromatic breathing diaphragm is a sheet of muscle separating chest from abdomen.  In abdominal breathing while we breath, Diaphragm contracts and pushes downward.  This relaxes abdominal muscles.  When we breath out, abdominal muscles contract, Diaphragm relaxes.This helps to reduce anxiety, depression, irritability, Tension, fatigue, Reduces shallow breathing.  It can be learned in a few minutes.  Do it five minutes at a time, twice a day.
PROGRESSIVE RELAXATION   : Reduces muscular Tension, anxiety, insomnia, fatigue, irritable bowls, muscle spasm, neck and back pain, high B.P. Mild phobias, stuttering.
Sit in a chair in a relaxed and comfortable way.. select a part of your body.  Tighten the muscles of that part.. as tight as is possible.  Relax muscles.  Do it thrice.  Then select another part.  Tighten and Relax muscles.  Like this do it in all the parts including face, scalp etc abdomen, back etc.
After the exercise is over raise slowly, to allow body to readjust.
Do it twice a day
Autogenic Training, Self Hypnotism, Visualizing (Guided Imagining), Positive thinking Meditation, Yoga are some other methods available.  Learning them from some one who is eminent in them and practicing them regularly will help us not only from reducing stress in our lives but also prevent the health hazards we are likely to face.  French pharmacist, emil coue commands his patients  to repeat following phrase.

“EVERY DAY IN EVERY WAY I AM GETTING BETTER AND BETTER”.

This positive statement had cured many diseases under his guidance.  So, why not say it to yourself everyday atleast 20 times immediately after getting up from bed.


BEHAVIOURAL TECHNIQUES TO COMBAT STRESS


Bio-feed back : Is use of instrumentation to observe bodily processes which are otherwise not visible or audible and to bring them under voluntary control.  Information about your body is fed to you by means of a visual audio display.  So that you are actually able to observe how your heart, breathing etc.  behaves when you are stressed.  Biofeed back machines serves as a an ‘inner eye’ offering.  This is helpful in reducing Tension headache, Migraine, Hypertension, Insomnea, Muscle Spasm, Epilepsy, anxiety, Phobia, asthma and stuttering.

Thought stopping : Useful for getting rid of obsessive and phobic behaviour.  Obsessive though are irrational, repetitive thoughts that worry a person leading to constant self doubt and severe anxiety, phobias are extreme fear reactions leading to avoidance of specific objectives or situations.


Thought stopping involves stopping a specific though chain.  Concentrate on unwanted thought for a brief period and suddenly stop of empty your mind.  A verbal command ‘stop’ or a loud sound are useful to interrupt unpleasant thoughts.

This is highly useful in treating obsessive thoughts of failures, accidents, death, sexual inadequacy, obsessive memorises etc. also useful in treating phobias like fear of snake, driving in the dark, lifts, fear of going mad, fear of diseases.


An aid to improve effectiveness of thought stopping is wearing a Rubber Band around your wrist.  When ever you say ‘stop’ stretch the rubber band and leave it, so that it inflicts a small degree of pain.  This sort of little self punishment will stop the ongoing thoughts.  The main idea is to stifle the each difficult thought as soon as it comes.  Such thoughts will slowly decrease in frequency and eventually go away altogether.


STRESS INOCULATION/COPING SKILLS


Preparation for a battle is half the battle won.  Similarly, awareness of what causes stress in preparation to combat its effects boldly.  Our body responds to mental images we create within us.  By relax the mind.  We can prepare ourselves mentally and physically to face an anticipated stressful event.  This is a rehearsal in imagination for real life event that are threatening or distressing.   This is useful in situation like… appearing an interview, presentation of paper before audience, arrival of new boss at work, first day in college, giving important speech.

Steps involved in this are as under:

01. Imagine forth coming event
02. prepare adequately
03. Rehearse before event
04. Give a break to yourself with pleasurable activities
05. Prepare for the worst.
06. Relax before the event
07. Expect some stress
08. Take time to recover
09. Reward yourself
10. Tell yourself in the middle of stressful situations, anxiety conquering statements like… ‘stay calm’ ‘don’t loose your cool’.  You have handled this before, Relax now, you cn surely do this, he can’t really hurt me’.  More you concentrate on these coping statements, quicken the relief from stress.

Assertiveness training

Being assertive means being able to standup for your rights, needs and feelings without violating rights or sensitivities of others, without showing aggression.  It is learning to communicate effectively in a polite firm honest and open manner.  It is the only way in which you can have your opinion heard, feelings appreciated and rights honoured.. assertiveness involves communicating effectively both verbally and non-verbally.  It is also a state of mind.  It is having choice and exercising that choice.

First find out to which style of behaviour you belong to among aggressive, passive or Assertive.  One should learn to behave in Assertive style.

In this process of learning we shall learn assertive body language, listening skills, getting compromise and being persistent.


Body language : Maintain eye cantact, erect body posture, speak clearly audibly, firmly.  Don’t use apologetic tone., use gestures and facial expression of emphasis
Listening : Be ready, beware of your own needs and feelings give undivided attention to other person.  Look at his point of view, let other person know that you are listening to him.
Compromise : Meet halfway, part of what I want with part of what you want etc.
Persistence  : Don’t get put off by people who say things to anger you or distressed you.  Don’t give up till you get satisfactory answer.
Avoid manipulation : learn to avoid being manipulated by others.  When some one refuses to take ‘no’ as answer, use a carefully, chosen sentences to use it as a ‘broken record’ and say it over and over agin.


Learn can ‘Defuse’ anger of other one by putting of discussion when some body in salts or criticizes you, give appearance of agreeing without promising change.  This is ‘clouding’.  Assertive inquiry, Assertive delay will help us in calming down our critic.

Assertive behaviour reduces distress and induces a positive state of mind and general good health.


JOB STRESS MANAGEMENT

Overload of work, time pressures, deadlines, conflicting demands, job uncertainty, under utilization of skills, unsympathetic Boss, and work monotony are some of common sources of job stress.
The individual, organization and environment in which organization functions determine one’s vulnerability to job-stress.  Management of this job stress is essential for healthy functioning of individuals and Institution.
Job Stress Management helps us to improve our ability to cope, gives sense of control at work, decreases feelings of guilt anxiety and low self esteem, improves relationships at work, increases problem solving abilities, reduces Psychosomatic symptoms, such as fatigue, insomnia Backaches, Ulcer etc.

How to Manage Job Stress:
01. Identify your symptoms of Job stress

02. Identify your sources of your job stress like lack of control, information gap, conflicts, over load under load, conflict in values etc.

03. Identify how you are responding to your job stressors

04. Set goals to change the ways of dealing with above job stress.

05. Change your thinking.  Make realistic appraisal of situation, Repetition of coping statements (I can handle it)  don’t blame yourself or anyone else.

06. Deal with your relationships at work.

07. Learning skills of negotiation in dealing with trouble some people / situations artfully.
These steps followed with thorough consideration will enable us to reduce our Job stress.

STEPS TO PREVENT JOB STRESS:
01.. Having Rational belief and attitude towards job, yourself and job performance.
02. Develop skills to develop behaviours need to do job effectively.
03. Develop support system at work.
04. Learn to Relax and use leisure time constructively.

LIFE STYLE CHANGES

NUTRITION: Adopting healthy habits and taking proper Nutrition increases resistance to stress.  Eat variety of foods, eat slowly, eat regularly, Don’t eat when feeling bored, or in angry or tired or anxious, eat smaller portions, Don’t see T.V. or Read News Paper when eating.

Avoid fats, particularly animal fate, avoid sugars, eat more lightly steamed fruits, whole grains cereals, avoid salt, alcohol, coffee, maintain vegetarianism, eat frequent small needs.

SLEEP:A sound sleep is one of the most important preprequisite for a healthy body and a healthy mind. So,

1. Go to bed only when sleepy
2. Have regular selling hours
3. Take warm milk before sleep
4. Don’t try hard to fall asleep
5. Stop worrying about not being able to sleep
6. Exercise during day
7. Engage in quite pleasant activities before sleep
8. Get massage for neck and shouders

EXERCISE:Jogging and waling are best exercises.  Do this for 20 to 40 minutes daily.  Indoor exercise equipment, yoga exercises, warmup exercises all help us in reducing stress.

TIME MANAGEMENT: Helps us in reducing Dead line anxiety.  Symptoms of poor time management are avoidance anxiety and job fatigue.  Constant rushing, Vacillating between unpleasant choices, missing deadlines.  Not having breaks in between to Relax, sense of being overwhelmed by work demands.

Strategies For Time Management

Establish priorities, create time by eliminating low priority tasks, learn to make basic decisions, plan in terms of time rather than tasks don’t start number of tasks at a time.  Complete a task before going to next task.  Group similar tasks,  allow some time for family, some time for yourself, you must have time to feel a sense of accomplishment and contentment.

OTHER STRATEGIES


LAUGHTER:

Improves breathing, lowers B.P. Releases healing harmones.  When you smile whole body becomes calm-humor, which eliminates gloom and worry, improves the bodies natural resources.  Laughter, the best medicine, can keep us healthy.  So try to spend time with cheerful people.  Try not to be too serious always, go through books, comedy videos/films.

ANGER:

 Is acid which can do more harm to vessel in which it is poured, than to thing on which it is poured.  It is normal human reaction.
We should learn to.  Reduce it in a healthy way.  Recognize the anger you feel, decide what makes you angry.  Give the provoker the benefit of doubt, practice mental relaxation, listen, learn the art of forgiving…. Use anger creatively.  Accept anger and handle it effectively.

MASSAGE:

Relaxes tensions from aching Muscles.  Stimulates blood flow, eases stress helps fluid drainages, generates sense of whole someness and peace.  Stroking, kneading, preasure and friction are four basic Manage movements.

SELF MASSAGE:

 Can be done while watching T.V. or taking Bath.  If necessary pleasant smelling oil can be used to lubricate.  It’s helpful in relieving pains and aches. Start from face, to scalp , neck, shoulders, back, hands and arms, legs and thighs, feet, Massage helps to rediscover healing power.  Get your mind of thoughts and concentrate on task of massaging.

Where to seek help?

PROFESSIONAL HELP
Some time it may not be possible to cope with stress despite using several strategies mentioned earlier.  It such case we could seek the help of our doctor, Psychiartist or Psychologist or Trained Counceler.They would listen to you objectively, analyse problem situation more clearly classify your thinking and offer a course of action that is tailored to suit your individual needs.

MEDICINES:
Play a role in acute intense stress related symptoms to be used only as a last resort and for a short term.

SOCIAL SUPPORT
This plays an important role.

1. Emotional support providing sympathy care and concern, love, trust.
2. Instrumental support provides to needs, like money, looking after children.
3. Informational support provides information helpful in coping with stress
4. Appraisal support provides indirect support by approving and recognizing persons actions.

Social support reduces stress, impact of stress, improves resistance to illness, workplace friends, family members, clubs religious groups can provide social support.

HELPING OTHERS TO HELP YOUR SELF:
Regular voluntary service actually increases life expectancy.   It is good for one’s mind and nervous system.  Ultimately when going gets really tough, One should into shy away from seeking professional help or mobilizing social support in dealing with stressful time.

REMEMBER
TOUGH TIMES DON’T LAST
BUT
TOUGH PEOPLE DO

HOW TO BE HAPPY ALWAYS

  HOW TO BE HAPPY ALWAYS

Happiness – the mantra every human being on this earth is often chanting now a day. Then, we must know what actually the “happiness” is? If I ask this question, few people may reply that having bungalow, big car, handsome salary and good bank balance – is happiness. Some may say keeping good health, others may say earning name and fame in the society. Then after getting all the materialistic comforts like car, bunglow, bank balance, name and fame, is human being staying happily throughout their life? These things may keep the person happy for a temporary period only, but not always. In reality, happiness is available to all of us, right now. A bunglow or a new car won’t actually make a person happier; it is the simple joy in life that brings true happiness.

Then, what to do to attain the real happiness in our life, which will be with us forever. Here are some interesting areas one can choose as per their interest to lead a real happy life.

1. Help Others:

Sometimes after accomplishing their personal goals, people still feel empty inside because they have not made meaningful contribution to someone else’s life to those who are in real need. Helping needy and downtrodden people in the society makes people finding their own happiness.

2. Share with others:

When we share our ideas, our time and our abilities with others, we feel better for it. A life lived without sharing can become lonely and boring. When you share with others, they will also feel great towards you and help you to feel more happiness in your life.

3. Smile More:

Whenever there is an opportunity, smile and make people around you also smile. Smile costs nothing. In fact smile rejuvenates your nerves system, helps relief from tension. Smile can make you happier.

4. Spend time with your loved ones:

After completing your office / business work, spend the leisure time with your family and children. Try to take food with all the family members once in a day, preferably at night. Keep away all your electronic gadgets when you are spending time together. This enables focused attention towards our loved ones. Make sure that you are a fond member of the family who cares for them.

Friends and relatives are also plays a prominent role in our life. Try to allocate time and meet them occasionally and interact with them. Try to plan for holidays at least twice in a year with family and

friends. This helps not only keeps you happy, but makes the entire family and friends happy and strengthen the bondage among you all.

5. Dump negative thinking:

It is quite natural for a human being to carry negative feelings, negative thoughts for long time. Moreover, they do not leave this negativity easily. Because of this characteristic, people feel sorrow, stressed and unable to live happily. Once a person comes out from these negative thoughts then only they can be happy in their life. To overcome this, try to choose people with positive mindset as your companion and try to spend time with them.

6. Forgive and forget:

The greatest virtue in a human being is “Forgiveness”. A person who forgives faults, mistakes, and wrong doings of others will be adjudged as a saint. By virtue of this forgiveness, the heart and mind is clean always and he/she does not carry any grudge against any one, which enables the person to lead a happiest life.

7. Be yourself:

As Steve Jobs said, “your time is limited, so don’t waste it living someone else’s life”. Accept who you are, just be yourself and you will feel a world of difference.

Hope, everyone try to follow these small traits and get immense happiness throughout their life. Finally I would like to conclude this with the following saying of Lord Gautama Buddha

Very important legal

  Sole Prop: 

Rationale: There is no difference between the sole proprietary account and individual account.  Hence RBI advised banks to extend the facility of nomination to proprietary concerns also for smooth settlement of accounts.  No legal existence separate from owner.

JOINT HINDU FAMILY (HINDU UNDIVIDED FAMILY) :

A JHF can be formed for ancestral business

A JHF is governed by Hindu Succession Act

Generations : 3

All male members of the family are called as Coparceners and after the amendment of Hindu Succession Act in 2005, even the daughter of a coparcener get the status of a coparcener 

In the Mitakshara school of Thought the son/daughter acquires the right over the JHF property by birth 

In Dayabhaga the son/daughter acquires the right only after the death of his father (West Bengal)

Karta is the eldest coparcener of the family

Karta can bind the share of all the coparceners in JHF property for payment of any loan taken by him for JHF activity

Karta’s liability is unlimited whereas the coparceners’ liability is limited to the extent of their share in the JHF property

Karta can give a mandate to other coparceners (senior) to operate the bank account but not to third parties

Every  6 months confirm / authorize transaction done

Loan  request / document to be signed by all coparceners 

When the Karta dies, the next senior most coparcener will take over as Karta

A JHF cannot be a partner in a partnership firm.

If Karta becomes insolvent, stop operations on the account and await the court order. 

In case of minor coparceners, a signature of guardian is obtained on his attaining majority, fresh HUF letter is obtained.

Bank has designed JHF letter COS 38

CLUBS / ASSOCIATIONS :

Society Registration Act 1860 

Clubs and Associations need not be registered but Banks does not open account for unregistered societies.

If to be registered, then they must be registered with Registrar of Societies

Resolution, Registration Certificate & Bye-Lawsare  important documents to be obtained at the time of opening the account

Any cheque issued by the Secretary can be paid by the banker if presented even after his death

No loans can be given as these are non-trading bodies          

Nonprofit making companies(sec 25 of companies act)

Generally for promotion of Art, Literature, Religion

Govt. approval is required

TRUSTS :

Indian Trust Act 1882 mainly deals with Private Trust

A- Creator/Author/Settler

B – Grand Son / Daughter (beneficiary)

C- Trustee (X/Y/Z)

The trustee is supposed to take care of the trust even after the death of the Creator

A trust can be a Private Trust or a Public Trust which is also known as Charitable Trust

Private Trust is governed by Indian Trust Act whereasPublic Trust is governed by Public Trust  Act of the State concerned

Private Trust can be registered with Registrar of Assurances whereas a Charitable Trust can be registered with Charity Commissioner

There is no ceiling regarding the number of trustees

Trustees are acting in fiduciary capacity

A cheque drawn by a trustee can be paid even after his deathwhereas in the case of a sole trustee it is not paid after his death

Rationale: Trustee of a Trust is acting in a fiduciary capacity.  His death will not affect the trust unless he is sole Trustee.  The Banker can pay the cheques drawn by the Trustee even after his death.  If sole Trustee dies, the cheque will not be paid.  Another Trustee to be appointed by Creator / Court/  Does not affect if there is more than one Trustee.

A trustee cannot delegate his authority to third parties

Sec 190 of Contract Act – A delegate cannot further delegate

All trustees should sign the account opening form

The bank has to go as per the provisions of the trust deed

The bank should not open an account in the name of a trust unless it is clearly indicated in the title of the account

Document to identify the Trustees,Trust deed, Regn Certificate of Charity Commissioner, Resolution to open account, Authorised persons, Power to borrow are to be verified.

Trust accounts are to be scrutinized by the Branch Manager at the time of takeover of the branch and thereafter annually.

An insolvent person can act as a trustee.

In the case of a public trust (chairtable trust), a resolution passed by board of trustees has to be obtained to know the names of the trustees who will be operating the bank account and the mode of operation. It should tally with the provision in the trust deed.

PARTNERSHIP FIRMS :

Partnership act 1932

There should be minimum two partners in a firm as per Sec.4 of Partnership Act and maximum 100 as per Sec.464 of Companies Act

A partner is an agent of firm and also agent of other partners (Sec.18)

A partner has no implied authority for opening a bank account of the firm in his personal name (Sec.19)

Sec 19(1) The partner can bind the firm only if he signs for and on behalf of the firm 

Implied authority of a partner can be curtailed or enlarged by all the partners (sec 20)

Partners’ liability is joint and several(Sec.25)

A minor can be admitted to the benefits of a partnership (sec 30)with the consent of all the partners within 6 months of attaining majority.

A partner cannot continue as a partner if he becomes an insolvent (Sec.34)

Death or insolvency of a partner dissolves the partnership firm unless otherwise stated in the  partnership deed (Sec.42)

When the assets of the firm are insufficient to liquidate its liabilities, then any surplus in the individual partners’ assets after paying off their personal liabilities is brought into the firm and firm’s liabilities are paid off (Sec.49)

Registration of partnership firm is optional (Sec.58) Banks will not give loan to unregistered firms.

But an unregistered firm cannot sue its debtors (Sec.69)

Sec 59 to 61 of act rule in Clayton’s case – 1st creditwill wipe out 1st debit in the Partnership account.

Two firmscannot form a third partnership firm

But two companies can form partnership provided their MOA allows it.

A partner cannot delegate his authority to third parties without the consent of  other partners

A JHF cannot be a partner in the firm

Partnership Deed, Letter, Address proof ,Tel Bill in Firm Name & Partners, Regr. Certificate

Partnership Letter – to inform the Bank any change.Undertaking by the partners that the liability is joint and several.

Identical Firms – where partners are same

Partnership at will – Anyone can retire by giving reasonable notice

The firm is compulsorily dissolved on the happening of any of the following events

       a)  All the partners become insolvent

 b) When the business of the firm becomes unlawful

 c) When a competent court passes an order for the dissolution of the firm

COMPANIES :

One Person Company: Single Man company is different entity / concept. No compulsion on AGM. Minimum Capital 1 lac. Paid up capital up to Rs.50 lacs Turnover upto Rs.2 crores. Convert to Pvt. / Pub Ltd. if crossed.

The minimum paid-up capital of a Private limited company should be NIL and that of Public limited company should be NIL(amended in 2015).

Minimum number of shareholders for a private limited company is 2 and maximum is 200.

Minimum number of shareholders for a public limited company is 7 and there is no restriction regarding the maximum number of shareholders 

The minimum number of directors for a Private limited company should be two and for that of Public limited company should be threemaximum 15 in both cases. Max directors can be increased with prior approval from the central government.

A person can be director of 20 companies; independent director of 7.

One woman director S149(1) Paid up capital 100 crore or more & TO 300 crore or more; one director should be resident Indian.

Directors are acting in fiduciary capacity

Rationale: A company is separate legal entity and the directors are acting in fiduciary capacity.  Therefore, the death of the director will not affect the company.  Hence, Banks do not stop operations on the account of the company.

An insolvent director cannot continue as a director of the company

Borrowing powers of the company is mentioned in the Memorandum of Association whereas the borrowing powers of the directors is mentioned in Articles of Association

A company cannot be declared as an insolvent but it can be wound up

Certificate of commencement of business is issued by the ROC only after 90% of shares of the company are subscribed by the public has been withdrawn now.

Escrow Account – A collection account to be opened for collection of application money (collection of cheque and drafts) No debits allowed only credits

When the entire share capital is held by the Government, the company is called Public Sector Undertaking

If the Government is holding majority share capital of not less than 51%, it is called a Government company

Memorandum of Association contains the objects of the company, its activities, borrowing powers etc.

Articles of Association contain what the Board of Directors can do on behalf of the company to carry on the activities of the company and their borrowing powers.

Directors’ liability is limited to the extent of shares held by them in the company. Hence while  sanctioning a loan to the company, personal guarantee of the directors is obtained to make them personally liable

Death of a director does not dissolve the company. Bank need not stop operations on the account as long as the minimum number of directors as stipulated is maintained

The official liquidator is appointed by the Court when a company goes for compulsory winding up.

If the company decides to wind up voluntarily, then the board of directors appoint a liquidator after taking the approval of the shareholders in the general body meeting

A cheque drawn by a director can be paid even after his death since the director acted in fiduciary capacity. A company is defined as a separate legal entity with perpetual succession.

No separate introduction is obtained while opening an account in the name of company – because the memorandum, articles of association and certificate of incorporation provides enough documentary evidence to prove that the company has come into existence.  These documents can be accessed by the banks online in the website of the ROC.  Therefore, banks do not insist for separate third party introduction.

Board resolution is obtained at the time of opening an account in the name of company – as the resolution authorizes the company to appoint a particular banker as the banker of the company.  Further it also furnishes the name of the officials of the company who are authorized to operate the bank account together with the mode of operation.

DRT MATTERS

1. The normal cut off limit to file an application in DRT shall be Rs.  20 Laksand above

2. Where the cases before Debt Recovery Tribunal are decided, Tribunal awards Certificate of

Recovery (RC – Recovery Certificate).

3. The appeal on a DRT judgment is to be filed at Appellate Tribunal at respective centres

4. Whether already decreed accounts in various courts can be transferred to DRT YES, Where E P

amount reaches Rs. 20 Lakhs & above

5. Cases before DRT are presented by- Empanelled Advcoate

6. An appeal against the decision of DRT can be filed by customers - Before appellate tribunal (DRAT)

7. Time limit for filing application with DRT for Recovery Certificate in respect of civil court decrees

passed for less than Rs.20 lakhs 3 years from the date when the decretal amount accrues to Rs. 20

lakhs

GENERAL ASPECTS

1. Garnishee order is issued by: Any competent court

2. An income tax attachment order has been received in the name of Mr. Mishra who has an FDR

with your branch. The FDR has already matured for payment. Before payment to IT authorities -The

bank need not insist on production of FDR

3. A banker owes to his customer certain duties as implied contract out of which the most important

duty is - Duty of secrecy

4. Under Bankers Book Evidence Act, 1891 certified copies of banks books are admissible as

evidence in the court.

5. Bank A requests the Bank B for opinion on one of its customers. Bank B Will give information in

general terms disclaiming any responsibility

6. The person attesting the thumb impression/furnishes the attestation in Form No.821 must know

the language in which the loan documents are executed

7. Following documents need not be witnessed Agreement, hypothecation, Pledge etc

8. Which of the following documents need attestation? Mortgage Deed, Sale Deed, Will, Indemnity

Bond etc

9. When an advance is made to a Joint Hindu Family, the Loan documents are to be Signed by Only

the Kartha. However it is advisable to get it signed by all major members including female members

and minors to be represented by respective natural guardians.

10. Registration of documents is compulsory under Section 17 of the Registration Act in the case of

Gift, Sale Deed, Simple Mortgage etc

11. Payment of a cheque is complete: When cash is parted with

12. The Registration of a Will is: Optional

 

13. Average Clause ― in the insurance policy restricts the amount of claim in proportion to amount

of insurance and value of security.

14. Following documents can be treated as legally valid only originally typed copy of loan agreement

(not on copy/ carbon copy)

15. Legally, Bank is in order if part of the blank columns in the loan papers are filled up subsequent

to execution, if The executants put their signature authorising such filling up, after filling up

16. Stop payment instructions can be issued by Drawer

17. When cheques or bills of exchange are collected by the bank on behalf of its customer, the

relationship between them is that of A principal and an agent

18. What is the alternative if presenter of a cheque refuses to sign on its reverse? Money can be paid

after obtaining receipt on separate paper

19. A corporate customer requests the bank for returning to them the cheques drawn by them and

already paid by the bank - The cheques can be returned periodically after retaining the true copies

on record. The cost to be borne by the customer

20. Can the original cheques be returned to the drawer after payment?

YES, the bank can return the paid cheques if requested within the period for which bank is required

to preserve them

21. The banker and purchaser of a demand draft have a relationship of Seller and purchaser

22. The Banker can disclose information about the customer - When the customer expressly or

impliedly permits disclosure/when the Banker is compelled by law/when the Banks own interest is to

be protected.

23. In case of telegraphic transfer (RTGS/NEFT) of funds the relationship between the banker and

the remitter is that of Principal and agent

24. Collection of supply bills is undertaken by banks on the strength of Power of Attorney given by

supplier in favour of bank

25. Presentment of the bills received for collection to the drawees is done at - The address

mentioned in the bill/hundi

26. Whether protection is available to the bank for collection of inward bills received by it Under N I

Act NO

27. Banks keep cash in currency chest as a bailee

28. Supply bills are Not accompanied by Document of Title to Goods, are actionable claims and not

governed by N I Act

29. A suit against a common carrier for loss of or injury to goods entrusted to him for carriage

cannot be filed - Unless a written notice of such a loss is given within 6 months from the date of

notice of loss before institution of suit

30. Whether partner‘ s interest in a firm can be attached before judgment YES

31. The time limit for impleading legal heirs in a pending suit is 90 days from the notice of the date

of death

32. The Stop-Payment Instruction given by one of the two joint account holders can be lifted by:

Both of them jointly

33. The periodical interest payable on such deposits should be credited... Credited to respective loan

account, if any loan is a sanctioned against it.

34. With in how many days the rectification and compliance report of shortcomings pointed by

Labour enforcement officials during their inspection under Payment of Gratuity Act, 1972, Equal

Remuneration Act, 1976 and Payment of Bonus Act, 1965 should be sent to Deputy Chief Labour

Commissioner/Regional Lab

our Commissioner and Labour Enforcement Officer -Within 2 days by

Regd Post

SARFEASI ACT

• The act has two parts, first part stands for securitization and reconstruction of financial assets and

other part is enforcement of security interest.

• Eligible assets under the act may be enforced without intervention of court or tribunal with the laid

down procedure under the act.

• If party failed to deposit the amount, possession of charged/ secured assets is obtained from the

bank under section 13(4) of the act. Publication of possession notice in the act within 07 days is

mandatory.

• No secured creditor shall exercise any right, unless exercise of such right is agreed upon by the

secured creditors representing not less than 3/4th in value of the amount outstanding.

• If borrower restricts the bank to take physical possession of secured assets, petition is filed under

section 14 of the act to the CMM/DM praying to get the physical possession of the assets.

• No action is taken before 45 days of taking possession, as 45 days time is given under the act to

appeal against the action of the bank.

• Appeal with DRT can be filed by the party only after taking possession of the assets under section

17 of the act. Thereafter appeal can also be filed with DRAT under section 18 of the act. Civil court

does not jurisdiction to entertain any suit under provision of the act.

• Secured assets can be disposed off / sold giving 30 days notice to the parties concerned followed

by 30 days publication of sale through auction/ tender notice of these assets in the vernacular

newspaper and national daily.

• 60 days notice is served under 13(2) of SARFEASI

• Action is taken for the dues exceed Rs.1 lakh

• Agriculture Land and lease hold property can not be enforced

• Appeal is made within 45 days of possession of secured asset 

• 30 days notice is served indicating there in the sale of asset

• 30 days publication is made for auction of secured assets

• Possession of property is obtained under 13(4) SARFEASI Act

• Publication of possession of property -within 7 days from the date of possession.

• SERFEASI ACT 2002 does not apply to the following assets –

A -lien on any goods, money or security.

B -A pledge of moveable.

C – Creation of any security in any aircraft or vessel.

D – Any property that can not be attached under any other law.

E – Any security interest for securing repayment any financial asset not exceeding Rs.1 lac.

F – Any case in which the amount due is less than 20% of the principal amt.

G – Any interest created in agriculture land.

SECURITISATION & RECONSTRUCTION OF FINANCIAL ASSETS AND ENFORCEMENT OF

SECURED ASSETS ORDINANCE 2002 - SARFAESI Act - 2002

1. Is it necessary to classify the account as NPA for initiating action under the Act? YES

2. The above Act is applicable in respect of debts due to Nationalised Banks only

3. The Provisions of the Act are applicable in respect of All NPA a/cs with liability above Rs. 1 lac

4. Enforcement is not possible under this Act in respect of Time barred debts, where the present

liability is less than 20% of principal + int. &where the secured asset is an Agricultural Land

5. Whether limitation is suspended or saved while proceeding under the act? No

6. Movables seized under this Act have to be got valued by Valuer in the panel approved by the

Board of the Bank

7. When there is more than one creditor in respect of a secured asset, action under this Ordinance

can be initiated only if 75% of creditors in value agree

8. Whether advocate can issue notice under the Act? No.

9. Under SARFAESI ACT 2002 whether demand notice is required to be issued to Guarantor also?

Only when the guarantor extends his property as a security apart from his Personal guarantee

10. Can appeal under SARFAESI ACT 2002 would be made to DRT even in cases for claims less than

10 lakhs Appeal can be made with DRT in all the cases

11. For an agricultural loan, if any security other than agricultural land is taken whether it can be

enforced under the act? The Act is not applicable only where the security is agricultural land and

hence, we can enforce the securities in the referred case.

12. Can the Bank entrust the work of taking possession of securities to seizure agent? Authorised

officer alone is entitled to take possession of the property

13. Who is the authority to fix the reserve price when the assets are auctioned? Authorized officer in

consultation with the appropriate authority

14. Who can issue the sale certificate under the act? Authorised officer (SMGS IV and above)

15. Whether Banks attach salary of the borrower/guarantor under the act? No, as these are not

secured assets

16. Provisions of SARFAESI Act 2002 enables the Bank to sell their financial assets to Asset

reconstruction company AND Securitisation company

17. When Mortgaged property is a tenanted property before the mortgage whether under SARFAESI

Act Tenant can be evicted NO Bank has to evict the tenant only through eviction proceedings as per

Law covered under Indian Tenancy Act.

18. Whether the Lease/tenancy created after the Mortgage will bind the Bank No it is not binding

on the Bank

19. Whether the Mortgagor has powers to lease the property As per Sec 65A of Transfer of Property

Act the Mortgagor can lease the property but not for more than 6 months and that too the lease is

subject to mortgage

FIFTY BANKING TERMS FOR BANK INTERVIEWS/EXAMS

  FIFTY BANKING TERMS FOR BANK INTERVIEWS/EXAMS

1. Repo Rate

1.When RBI provides a loan to the bank for short-term between 1 to 90, RBI takes some interest from the bank which is termed as Repo Rate.

2. Reverse Repo Rate

⏫When bank deposit it's excess money in RBI then RBI provides some interest to that bank. This interest is known as Reverse Repo Rate.

3. SLR –(Statutory Liquidity Ratio)

⏫Every bank has to maintain a certain % of their total deposits in the form of (Gold + Cash + bonds + Securities) with themselves at the end of every business days. Current SLR is 20.75%.

4. Retail banking

⏫Retail banking is a type of banking in which direct dealing with the retail customers is done.

⏫This type of banking is also popularly known as consumer banking or personal banking.

⏫It is the visible face of banking to the general public.

5. Bitcoin

⏫Bitcoin is a virtual currency/ cryptocurrency and a payment system.

⏫It can be defined as decentralized means of tracking and assigning wealth or economy, it is a software protocol.

⏫Bitcoin uses two cryptographic keys, one public (username) and one private (password) are generated.

⏫1Bitcoin= 108 Satoshi.

6. Call money

⏫Call/Notice money is the money borrowed on demand for a very short period. When money is lent for a day it is known as Call Money.

7. Notice money

⏫When the money is borrowed or lent for more than a day up to 14 days it is called Notice Money.

8. Difference between Capital market and Money market

⏫A capital market is an organised market which provides long-term finance for business.

⏫Whereas Money market provides short-term finance for business

9. Scheduled bank

Banks which are included in 2nd Schedule of RBI Act 1934 are known as a scheduled commercial bank. These banks should fulfil two conditions:

⏫Paid up capital and collected funds should not be less than Rs.5 Lacs.

⏫Any activity of the Bank should not adversely affect the interests of the customers.

10. Non Performing Assets

⏫NPA is an asset of a bank which is not producing any income.

⏫Bank Usually classify as nonperforming assets any commercial loans which are more than 90 days overdue and any consumer loans which are more than 180 days overdue.

11. Money Inflation

⏫Money Inflation is a State in which the Value of Money is Falling and the Prices are rising, over a period of time.

12. Negative interest rate

⏫When there is less demand for loans the banks park their excess fund with the central bank by which they get an interest.

⏫Negative interest rate policy (NIRP) means that central banks will deduct money from commercial banks for depositing their money with the central bank. Commercial banks, in turn, will do the same to common people.

⏫So the end effect is that people will have to pay money to banks to hold their cash.

13. Green Banking

⏫Green banking means promoting environmentally friendly practices and reducing your carbon footprints from your banking activities.

⏫Green banking aims at improving the operations and technology along with making the clients habits environment-friendly in the banking business.

⏫It is like normal banking along with the consideration for social as well as environmental factors for protecting the environment.

14. Blockchain system

⏫These days the transactions in the banking sector are becoming a very tedious task and so as to ensure that this tedious task to be removed, our banking sector is trying to emerge towards blockchain technology.

⏫To simplify the transactions without the help of any third party in a secure manner is really a great challenge, but to overcome this challenge an anonymous online ledger (collection of financial accounts) which uses the data structure to simplify it is called blockchain technology.

15. Balloon mortgage

⏫A mortgage is a transfer of a right to stable property for the security purpose of a loan amount.

⏫Balloon mortgages are just for short term and it has fixed rate mortgage.

⏫In balloon mortgage, a monthly payment is lower because of large payment at the end of a term.

⏫A balloon payment is for the honest and qualified borrowers who have the good credit history.

16. Retail credit operations

⏫Retail Credit Operations means the sequential process which involves screening, evaluation of risk(s), and ensuring that the bank lends to a creditworthy client from the asset products applications sourced.

17. Skimming

⏫Skimming is a method used by fraudsters to capture customer's personal or account information of credit card.

⏫Customer's card is swiped through the skimmer and the information contained in the magnetic strip on the card is then read into and stored on the skimmer or an attached computer.

⏫Skimming is a tactic used predominantly for credit-card fraud, but it is also a tactic that is gaining in popularity among identity thieves.

18. Money laundering

⏫Money laundering is a process of conversion of illegal money from various sources to appear to have originated from legitimated (Legal) source.

⏫The major sources of illegal money are tax evasion, bribe, Smuggling etc.

19. Cheque

⏫Cheque is an unconditional order addressed to a banker, signed by the person who has deposited money with a banker, requesting him to pay on demand a certain sum of money only to the order of the certain person or to the bearer of the instrument.

20. Direct Debit

⏫Direct Debit is a financial activity in which one person withdraws funds from another person's bank account.

⏫It is a facility in which the payee withdraws the amount from the payer's account, the payer has instructed the bank to allow the payee directly withdraw the amount from the account.

21. Cash Credit

⏫Cash Credit is a proper limit sanctioned by the bank to the borrowing manufacturing/trading unit against the value of the raw materials, semi-finished goods and finished goods including stores.

22. Bill of Exchange

⏫A bill of exchange is a non- interest bearing written order which is used primarily in foreign trade which binds one party to pay a fixed amount of money to another party at a decided future date.

⏫A bill of exchange is signed by the creditor and accepted by a debtor.

23. Cash Reserves Ratio

⏫Every bank Maintain certain % of their total deposits with RBI in the form of Cash and Net demand & Time Liabilities.

⏫ Every Bank has to pay the amount to RBI on every 15 Days.

24. Bank Rate

⏫Bank rate is also termed as “Discount Rate”

⏫The rate through which RBI charges certain % for providing money to other banks without any security for a Long period of time for 90 Days 

25. Marginal standing facility

⏫MSF is the rate through which bank can borrow funds for Short time – Overnight basis.

26. Minimum Reserve system of RBI

⏫The current system of the Indian government to issue notes is “Minimum Reserve System”.

⏫Under this policy, the minimum reserves to be maintained in the form of gold and foreign exchange should consist of rupees 200 crores.

⏫Out this reserve, the value of gold to be maintained is rupees 115 crores.

⏫This system was introduced in 1956 replacing the proportional reserve system.

27. Clean note policy of RBI

⏫Lots of people in our country have a bad habit of writing something on the currency note, folding currency note, also somebody staple it which spoils the Note and reduces notes durability.

⏫So to avoid such occurrences RBI introduced the Clean Note Policy in 2001 in an order to increase the life of currency notes.

⏫The main objective of this Clean Note Policy is to provide good quality currency notes and coins to the citizens of our country.

28. CAMELS rating system

⏫CAMELS is a rating system developed in the US that is used by supervisory authorities to rate banks and other financial institutions.

⏫It applies to every bank in the U.S and is also used by various financial institutions outside the U.S.

Each factor is assigned a weight as follows:

⬅Capital adequacy 20 %

⬅Asset quality 20%

⬅Management 25%

⬅Earnings 15%

⬅Liquidity 10%

⬅Sensitivity 10%

29. Masala Bonds

⏫The bonds listed on the London Stock Exchange (LSE) is termed as Masala Bonds.

⏫These bonds are offered and settled in US dollar to hike Indian Rupee in International market .

⏫These bonds help to raise Indian rupees from International investors for infrastructural development in India.

⏫International Financial Corporation (IFC) converts bond from dollars into rupees and uses the rupees to finance private sector investment in India.

30. Core Banking Solutions

⏫Core Banking Solution (CBS) is networking of branches, which enables customers to operate their accounts, and avail banking services from any branch of the Bank on CBS network, regardless of where he maintains his account.

⏫The customer is no more the customer of a Branch.

⏫He becomes the Bank’s Customer.

31. Unified Payment Interface

⏫This interface will integrate the entire payment systems in India.

⏫It uses a single application programme interface with a series of Application Programme interface (API’S).

⏫The mobile devices are the primary object for all the payments.

32. Micro ATM S

⏫Micro ATMs are not any special type of ATMs

⏫It is the advanced version of Point of Sale (PoS) having an additional feature of Biometric scanning.

⏫It is also known as a mini version of ATMs.

⏫These machines are connected with the GPRS (General Packet Radio Service) mobile internet and it uses Core Banking Solution (CBS) platform to perform the different types of services.

33. Letter of Credit

⏫The letter of credit is one of the negotiable instrument.

⏫It is given by the bank, that guarantee’s buyer’s payment to the seller shall be received on time along with the proposed amount to be paid.

⏫In this instinct, if the buyer is unable to make the agreed payment to the seller, then the bank will cover the full or remaining amount of purchase.

34. Bancassurance

⏫Bancassurance is the concept of selling insurance products of insurance companies by banks.

⏫The bank acts as an agent and promotes Banca (bancassurance) products under section 6(1)(o) of the Banking Regulation Act, 1949.

⏫It was originated in Europe in the 1980s and was successful.

⏫The bancassurance business model is a globally accepted profitable business.

35. Banking Ombudsmen

⏫Banking Ombudsman is a senior official appointed by RBI.

⏫He handles and redresses customer complaints against deficiency in certain banking services.

⏫The Banking Ombudsman Scheme was introduced under Section 35 A of the Banking Regulation Act, 1949 by RBI with effect from 1995.

36. The Balance of Trade

⏫The difference of the country’s exports and the value of its imports are known as the Balance of Trade.

⏫It normally incorporates trade in services unless mentioned as the balance of merchandise trade.

⏫It includes earnings (interest, dividends, etc.) on financial assets.

37. A Balance of Payments

⏫A list that states a country’s transactions with other countries for a certain time period (generally 1 year).

⏫Payments into the country (receipts) are entered as positive numbers, called credits.

⏫Payments out of the country (payments) are entered as negative numbers called debts.

⏫A single number summarises the country’s international transactions: the balance of payments surplus.

38. NOSTRO Account

⏫A NOSTRO account is one which is maintained by an Indian Bank in the foreign countries.

39. VOSTRO Account

⏫A VOSTRO account is one which is maintained in India by a foreign bank with their corresponding bank.

40. LIBOR

⏫The full form of LIBOR is London Interbank Offered Rate.

⏫It is the interest rate at which funds are borrowed by banks in marketable size, from other banks in the London interbank market.

41. MIBOR

⏫The full form of MIBOR is Mumbai Interbank Offered Rate.

⏫It is the interest rate at which funds are borrowed by banks in marketable size, from other banks in the Mumbai interbank market.

42. CASA Account

⏫CASA stands for Current Account Savings Account.

⏫The CASA ratio displays the value of deposits maintained in a bank in the form of current and savings account deposits in the total deposit.

⏫A higher CASA ratio means the better operating efficiency of the bank.

43. RAFA Account

⏫RAFA stands for Recurring Deposit Account Fixed Deposit Account.

⏫The RAFA ratio shows how much deposit a bank has in the form of Recurring and fixed deposits.

44. DEMAT account

⏫The full form of Demat Account is Dematerialized account.

⏫This is a type of bank account for citizens in India so that they can trade in stocks or debentures which are listed in the stock market.

⏫Just as a savings account contains money saved, a demat account has stocks saved.

45. Legal Tender

⏫As per provisions of coinage Act 1996, bank notes, currency notes and coins (Re. 1 and above) are legal tender for the unlimited amount.

⏫The subsidiary coins (below Re. 1) are legal tenders for the sum not exceeding Re 1.

⏫Issue of 1, 2 and 3 paisa coins discontinued wef Sep 16, 1981.

46. Currency Chest

⏫Currency chests are operated by the Reserve Bank of India (RBI) so that they can provide good quality currency notes to the public.

⏫However, RBI has appointed commercial banks to open and monitor currency chests on behalf of RBI.

⏫The money kept in currency chests in the commercial banks is considered to be kept in RBI.

47. Insolvency

⏫An organization, a family, person, or company is declared as insolvent when they are unable to pay their debts back on time.

⏫One of the most common solutions for insolvency is bankruptcy.

48. Bankruptcy

⏫Bankruptcy is a legal declaration of person who is unable to pay off debts.

⏫In generally, Bankruptcy is of two types- Reorganization and Liquidation bankruptcy.

⏫Under the bankruptcy of reorganization, debtors should restructure their bill plans to make them more easily met.

⏫Whereas under liquidation bankruptcy, Debtors has to sell their assets to make money so that they can pay off their creditors.

49. Amortisation

⏫Amortization is a periodic payment of a debt like a loan or a mortgage.

⏫Amortization is the arrangement of a lump sum cash flow into many periodic instalments over a span of time, which is also called amortization agenda.

50. Credit Crunch

⏫A credit crunch is also known as a Credit squeeze or credit crisis.

⏫A credit crunch is a condition in which there is an immediate decline in the availability of a loan or the credit.

⏫A situation in which suddenly the credit becomes difficult to get.

⏫Sometimes it can be done by reverse actions like by strict rules and regulations to avail the fund from the financial institutions like banks, NBFCs, and many other lenders.