THE KERALA STATE FINANCIAL ENTERPRISES LIMITED

Corporate Office, “Bhadratha”, Thrissur – 680 020

Ref.No.3035 Date: 29/12/2001

CIRCULAR NO: 214/2001 (PLG)
(M.O.P.CORRECTION SLIP NO.170)

Sub: Reduction in Lending Rates – Short term Gold Loan for 3 months at special rate – Removal of
compounding system of interest under Gold Loan Scheme – collection of appraiser charges at the
time of payment of loan – reg.

Ref: 1. Circular No.135/2001(Plg) dt.13.08.2001(MOPCS No.162)

2. Circular No.101/2000(Plg) dt 16.06.2000(MOPCS No.145)
3. Circular No.111/2000(Plg) dt.27.06.2000(MOPCS No.146)
4. Circular No.43/97 dt.23.09.1997(MOPCS No.89)
5. Circular No.55/97 dt.26.11.1997(MOPCS No.94)
6. Circular No.87/2000(Plg) dt.24.05.2000(MOPCS No.144)
7. Circular No.139/2000(Plg) dt.07.08.2000(MOPCS No.150)
8. M O P Chapter XII,Para 12.12.

.....
To keep live the customer focus on our schemes, a cut in the lending rate has become essential and the
Board of Directors of the Company in their 310th meeting held on 21.12.2001 have decided to reduce
the rate of lending under the following schemes:

Name of scheme Existing Reduced Special Conditions

rate rate
Advance payment of prize money 16% p.a. 15%p.a. Nil

NHFS – Rs.2 lakhs and below 13.5% p.a. 12% p.a. Maximum period 7 years
(Yearly (Yearly
Diminishing) Diminishing)

NHFS – Above Rs.2 lakhs 14% p.a. 12.5%p.a. Maximum period 15 years
NHFS - Rs.2 lakhs and below for a 13.5%p.a 12.5% p.a
period above 7 years

RCL Maximum Rs.25000 14% p.a. 13% p.a. Maximum period 48 months.
(Yearly (Yearly
Diminishing) Diminishing)

The above changes will come inot force with effect from 01.01.2002.

Gold Loan
The Board of Directors have also decided to remove the compounding structure of gold loan interest
and to introduce a short term gold loan for 3 months in addition to the existing loan for 6 months.
 -2-

Short term Gold Loan: Maximum period of loan 3 months. Rate of interest 13% p.a. Maximum
advance 85% of the market price in proportion to the quality of gold. Other conditions: If the interest
is not remitted on or before the due date the account is liable for an extra charge of 1% of the principal
and the loan will be settled at 14% (simple) p.a. The auction sale procedure of the security should be
completed within a month from the due date of loan, if the account is defaulted.

Modification to the loan for 6 months: The rate of interest will be 14% p.a. (simple) maximum loan
amount 70% of the market price in proportion to the quality of gold. In case interest is not remitted in
full on or before the due date 1% of the principal will be levied as extra and the loan will be settled at
15% p.a. (simple). The auction sale procedure of security should be completed within one month from
the due date of the loan, if the account is defaulted.

Both the loans can be renewed for a total period of two years (including the original loan period).
Renewals can be made in fractions of the original loan period (or longer duration permitted),
provided the loanee has cleared the interest for the loan period completed or made upto date the
remittance of interest on the overdue loan. A loan originally taken for 3 months can be extended for 6
months on the higher rate of interest, but the loan taken for 6 months originally will not be extended
further for a period of 3 months on lower rate of interest. Appraiser charges will be collected at the
time of loan payment and for renewals no appraiser charges will be levied.

The new scheme and modifications above will come into force with effect from 01.01.2002.

For THE KERALA STATE FINANCIAL

ENTERPRISES LIMITED,

M.K.KARTHIKEYAN,
MANAGING DIRECTOR.

To : All Unit Heads

Copy to : 1. All Regional Managers
2. All Dept. Heads in H. O.
3. All I. A. Teams.
4. P.A. to M.D
5. Circular File