Note To: The Deputy General Manager

From : Operations & Services Department KMR.

Date : 10.01.2011, Ref: No. DGM/KMR/OPS & SER//Note

ISSUE FOR CONSIDERATION:

To consider waiver of Cash Handling Charges, - Ms Sagar Vyapar P Ltd A/c no

11520200000285 – International Business Branch (IBB )

BACKGROUND: M/s Sagar Vyapar P Ltd is maintaining a current account with

our Intt’l Business Branch since 17.11.2001. They deal in umbrella and Umbrella
components which involve also import of materials. The customer is maintaining
quarterly average balance of Rs.34.23 Lacs since the inception of CBS in 2006.
The branch has recommended for the waiver of Rs.42672.00 charged as cash
handling charges for the period 01.04.2009 to 30.06.2010

COST BENEFIT ANALYSIS: (for full year) Amount in lacs:

Branch has recommended for waiver of Rs. 42,672.00 for 15 months. Yearly
average for 12 months comes to Rs34138.00 (Rs. 42672*12/15)

PARAMETERS CD SB TD TOTAL
Average Inter Bank Deposit 34.23 --- 1.08 35.31
Interest Paid -- .08 0.08
Notional Interest @ 7.00 2.40 -- 0.08 2.48
Total interest Benefit 2.40 -- 0.00 2.40
Total service charges benefit 4.64 -- 4.64
from c/c a/c
Amount of Waiver(cash handling) (-)0.43 -- (-)0.43
Net Benefit 6.61 -- 0.00 6.61

S.L. PARAMETERS AMOUNT (in lacs)

1 Average Funded credit Outstanding ------
2 Interest earned (annualized) ------
3 Average Non fund business ------
4 Earning on non –fund Business -----

5 Waiver/Concession in Service charge proposed ----

6 Average yield in the account after taking

waiver/concession into consideration, credit ---------------
Balance, Margin Money etc.
However, if we consider the current rate of business and keeping the average
quarterly deposit as the same as reported above cost benefit would be as under:

Net benefit from deposit & service charges Rs. 6.61lacs

Total benefit Rs. 6.61 lacs

Justification

1. Net benefit after the waiver would be Rs. 6.61 lacs for full year.
2. The deposit is zero cost deposit.
3. Per month Cash handling Charges is only Rs2845.00 (42672/15).

Recomendation

Considering the following, we may accept the proposal for waiver in service
charges as recommended by the branch,

However, such waiver facility would be under following terms & conditions:

1) Waiver for Rs.42672.00 in cash Handling Charges for the period from
01.04.2009 to 30.06.2010 for one time.

2) Branch is to maintain all records of such waivers.

3) As per circular No. HO:Br: 101.43 dated 04.04.2009the waiver is within your
delegated authority.

Kindly advise.

S. Radhakrishnan
Asstt General Manager