Financials

HIGHLIGHTS OF THE FINANCIAL RESULTS FOR THE YEAR ENDED 31st MARCH, 2011 The Board of Directors of State Bank of Mysore approved the financial results for the year ended 31st March, 2011 at its meeting held in Delhi on 29th April 2011. The highlights of the performance and working results are as under. 2. NET PROFIT The Net Profit of the Bank increased to Rs.500.62 crores from Rs.445.77 crores in the previous year registering a growth of Rs. 54.85 crores (12.30%). While the net profit growth on a quarter on quarter basis is over 32%, the net profit grew by over 24% sequentially (from 3rd quarter to 4th quarter). The lower year on year growth (12.30%) is caused by the necessity to make higher provisions towards non-performing assets, to improve the Provision Coverage Ratio. The Banks Board has maintained a dividend rate of 100% for the year 2010-11, on an enlarged capital base. The payout ratio works out to 9.35%, compared to 8.08% for previous year. 3. OPERATING PROFIT The Operating Profit increased to Rs 1173.75 crores as on 31st March 2011 from Rs. 937.40 crores as on 31st March, 2010 representing a growth of over 25%. The increase in Operating Profit is on account of growth of Rs.399.45 crores (from Rs 1236.55 cr to Rs 1636 cr, at over 32%) in Net Interest Income. (Operating profit grew from Rs 290.91 crores to 304.22 crores on a quarter on quarter basis). While interest Income grew, year on year, by 14.62%, we were able to restrict Interest Expenses growth to 5.20% by increasing low cost Current and Savings Deposits. Growth in respect of operating expenses was higher at over 26% largely on account of higher staff expenses emanating from higher provisions towards gratuity and pensions. While a higher provision for gratuity was required to be made consequent upon the Parliament enactment approving hike in gratuity payments, higher pension provisions were made to meet the additional liability emanating from one more option for pension permitted in terms of the last wage settlement concluded at industry level. 4. KEY FINANCIALS

The Return on Assets is at a healthy level of 1.03%, while Return on Equity is 16.17%.

Net Worth of the Bank increased from Rs. 2070.44 crores to Rs. 3096.50 crores representing a growth of over 49%.

The Bank has been BASEL II compliant since 31st March 2008 and Capital to Risk weighted assets (CRAR) under Basel II, is at 13.76% against the regulatory benchmark of 9%. Core CRAR is at 9.78%.

Earnings Per Share (EPS) improved to Rs. 121.66 from Rs.110.07. The Book Value of a share (Face value Rs 10) has improved to Rs.662 from Rs.576, on an increased capital base.

Business per Employee has risen from Rs. 680 lacs in March 2010 to Rs. 782 lacs in March, 2011

Net Interest Margin (NIM) improved to 3.71% from 3.19%. Cost of Deposits declined to 5.56% from 6.01%, mainly owing to increase in CASA share from 31.06% to 33.97%.

Yield on Advances improved from 10.24% to 10.33%.

5. DEPOSITS Total Deposits increased from Rs.38880 crores in March 2010 to Rs.43225 crores in March, 2011 registering a growth of over 11% (Rs.4345 crores). Our focus was predominantly on CASA deposits which grew by over 21%. The Bank continued to restrict the growth of bulk deposits. 6. ADVANCES Total advances of the Bank reached Rs.34442 crores in March 2011, registering a growth of over 15% over the previous year. Our focus was predominantly on small loans including micro/ small enterprises, agricultural sector and other retail sector, which recorded a growth rate of over 23% year on year. While our priority sector advances recorded a growth of over 28% year on year, our loans to micro and small enterprises grew by over 47%. Under personal segment, our housing loans grew by Rs 386 crores and vehicle loans grew by Rs 57 crores. The Bank has lent Rs 3658 crores to MSE sector, Rs 5378 crores to Agriculture, Rs 2981 crores to housing, and Rs 560 crores to Education. The Credit Deposit Ratio stood at 80.51% as at March 31st, 2011. The Bank has achieved the benchmark under priority sector. 7. AGRICULTURE FINANCE Agricultural advances continued to receive high priority. Banks advances to agriculture in Karnataka stood at Rs.4153 crores and constituted 26.26% of the total advances of the bank in the State. The Agriculture Debt Waiver and Debt Relief Scheme 2008 of Government of India were implemented by the Bank. In terms of guidelines issued by Government of India, the farmers eligible for relief under Agriculture Debt Relief Scheme were also provided with an opportunity to settle their dues till 30th June 2010. The Bank also implemented Coffee

Package to assist the small growers with 25 acres of plantation holdings during the year, in line with the scheme advised by Government of India. During the year, Bank implemented new loan scheme to assist farmers viz., KRISHI KALYAN (MYBANK RAITHAMITRA). KRISHI KALYAN provides for simultaneous sanction of crop loans and produce loans facilitating farmers to avoid distress sale and fetch remunerative prices for their produce. 8. OTHER NEW SCHEMES/ PRODUCTS INTRODUCED A. SALE OF GOLD COINS: The Bank recently commenced sale of gold coins, with a view to provide gold at its purest form to the general public. Gold coins are available in tamper-proof see through pack with assay certification, signifying 999.9 purity, in 2, 4, 5, 8, 10, 20 and 50 gms. The sale is open for both customers and non-customers. The Bank has plans to sell about 500 kg of gold during current year. B. SME SECTOR: While continuing with all the existing products and schemes introduced to take care of the varying financial needs of the sector, the Bank has introduced during the year, several new schemes for micro and small enterprises viz., - MYBANKSME Welcome, DALLMILLS PLUS, SBM DOCTOR PLUS, and SME Shoppe. Bank also entered into tie-up arrangements with reputed truck and tractor manufacturers for extending hassle-free loans to transport operators and farmers. Micro Sector Collateral Free loan scheme provides for sanction of loans up to Rs.10.00 lacs without any collateral security or third party guarantee, (increased from Rs 5 lacs). 9. AWARDS FINANCING OF SELF HELP GROUPS The Bank has Credit linked 16918 groups with an advance amount of Rs.303 crores during the current year. The cumulative total of such credit linkage program covers 1,32,958 groups with a financial outlay of Rs.1200 crores up to 31st March 2011. These efforts of the Bank have been recognized and the Bank has been awarded the 1st Best Bank Award instituted by NABARD under the Commercial Banks Category for its performance under SHG Bank Linkage Program for the year 2009-10. The Bank has been the winner of either the 1st or the 2nd prize award since March 2000 continuously. The Banks Branch at Malavalli has also been selected as the best performer in SHG Financing amongst all the commercial bank branches in the State of Karnataka. 10. NPA MANAGEMENT Gross NPA ratio stood at 2.51% and Net NPA ratio stands at 1.38%, as at March 2011. NPA coverage ratio including prudential write offs is at 67.60%. 11. TECHNOLOGY The bank is fully on Core Banking Platform since 1st January 2006. The software provides for Anywhere Banking, Internet Banking, Mobile Banking, Operations through ATM, Remittance through various electronic modes such as Real Time

Gross Settlement, (RTGS) National Electronic Funds Transfer (NEFT), SBGRPT (remittance within the State Bank group) etc. Automated Teller Machines (ATMs): The Bank installed 127 new ATMs during the year taking the total number of ATMs installed to 735 of which 629 are in the State of Karnataka. Our ATMs are part of 25060 strong ATM network of the State Bank Group. The card base has crossed 19.47 Lacs as on 31st March 2011. Paper less online ATM customer complaints reporting and redressing facility through the Banks intranet is available in the Bank facilitating reduction in the time gap between reporting and redressing of customer complaints relating to ATM transactions. 12. BRANCH EXPANSION The Bank opened 17 General Banking Branches and one Cash Management Branch during the year. The total branch network of branches as on 31st March 2011 stood at 707, which includes 571 branches in the State of Karnataka. 13. FINANCIAL INCLUSION The Bank has taken up the responsibility of financial inclusion in 261 villages covering 247 villages in the State of Karnataka and 14 villages in the State of Tamilnadu, with population of above 2000, based on 2001 Census. We have already covered 133 villages so far, including 118 villages in Chamarajanagar district in Karnataka, and opened more than 69000 accounts under Business Correspondents (BC) model. Smart Cards: To promote Branch-less Banking, Smart Cards are introduced in rural areas enabling the card holders to avail banking facilities in remote places under the Business Correspondent Model. Besides facilitating normal banking business, these cards enable the beneficiaries to receive payments under MGNREGA and Social Security Pensions (SSP) even in remote villages where no banking facilities are available. The Bank has participated in implementing financial inclusion Programme by issue of Smart Cards for the purpose of Electronic Benefit Transfer (EBT) payments in Bellary and Chitradurga Districts. 14. FUTURE PLANS The Bank proposes to reach a business level of over Rs.96,000 crores during the year 2011-12 aiming a growth rate of 23%, from the present level of Rs 77667 crores. The Bank has drawn up ambitious plans to open 90 new branches and install 156 additional ATMs during the financial year 2011-12. The Bank is in the process of adding more than 1000 personnel to support its expansion plans. It is our aim to emerge as the Bank of 1st Choice in Karnataka, to attract young and new customers and at the same time retain the existing customers. New IT enabled services and products are being introduced to suit the needs of all customers on an ongoing basis. The Bank is aiming to achieve a higher mindspace of customers to emerge as MOST PREFERRED BANK in the state. BANGALORE 30th April 2011 DILIP MAVINKURVE MANAGING DIRECTOR

Audited Financial Results for the year ended 31st March 2011 <<

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State Bank of Mysore H .O.: K.G.Road, Bangalore - 560009, INDIA Phone: 91 80 22353901 to 22353909 ; 22353473. Fax: 91 80 22384480

Balance Sheet of State Bank of Mysore

Mar '11 12 mths Capital and Liabilities: Total Share Capital Equity Share Capital Share Application Money Preference Share Capital Reserves Revaluation Reserves Net Worth Deposits Borrowings Total Debt Other Liabilities & Provisions Total Liabilities 46.80 46.80 0.00 0.00 3,052.67 583.85 3,683.32 43,225.47 3,307.95 46,533.42 1,815.73 52,032.47 Mar '11 12 mths Assets Cash & Balances with RBI Balance with Banks, Money at Call Advances Investments Gross Block Accumulated Depreciation Net Block Capital Work In Progress Other Assets Total Assets 2,705.68 234.60 34,029.81 12,927.14 1,127.62 402.62 725.00 0.00 1,410.23 52,032.46

------------------- in Rs. Cr. ------------------Mar '10 12 mths Mar '09 12 mths Mar '08 12 mths

12

36.00 36.00 0.00 0.00 2,037.40 591.89 2,665.29 38,880.00 2,274.01 41,154.01 1,589.64 45,408.94 Mar '10 12 mths

36.00 36.00 0.00 0.00 1,635.11 599.93 2,271.04 32,915.77 2,762.08 35,677.85 2,536.89 40,485.78 Mar '09 12 mths

36.00 36.00 0.00 0.00 1,341.81 0.00 1,377.81 27,462.40 1,731.53 29,193.93 2,497.96 33,069.70 Mar '08 12 mths

1,1

1,1

22,0

23,0

2,6

26,8

12

2,765.62 213.85 29,535.86 11,494.41 1,107.10 374.11 732.99 0.00 666.20 45,408.93

1,735.05 407.66 25,616.05 11,377.96 1,060.28 328.91 731.37 0.00 617.70 40,485.79

2,661.55 244.54 21,027.15 8,402.76 406.56 283.57 122.99 0.00 610.72 33,069.71

2,0

16,4

6,9

26,8

Contingent Liabilities Bills for collection Book Value (Rs)

13,333.64 4,099.18 662.28

20,057.35 51.60 575.94

17,073.90 2,935.50 464.20

12,871.72 2,888.47 3,827.26

5,9

1,7

3,1