INSTITUTE OF PROFESSIONAL EDUCATION AND RESEARCH BHOPAL

MANAGERIAL ECONOMIC
Assignment no.1(module2) A report on banking sector in India

SUBMITTED TO

SUBMITTED BY Akash Yadav Preeti Jalkhare Ram Kumar Rathore Rohini Gop Shweta Mishra
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PROF. Dr. Resham Chopra

CONTENT
Cover page. Content. Introduction of sector Overall scenario of sector.. Major players in banking. Services in banking. Total revenue. Performance of banks.. Fluctuation in services. Analysis and conclusion. References.. Page no.1 Page no.2 Page no.3 Page no.4-6 Page no.7-8 Page no.9-10 Page no.11 Page no.12 Page no.13 Page no.14 Page no.15

INTRODUCTION OF SECTOR
in the last decades of the 18th century. The first banks were The General Bank of India, which started in 1786, and Bank of Hindustan, which started in 1790; both are now defunct. The oldest bank in existence in India is the State Bank of India, which originated in the Bank of Calcutta in June 1806, which almost immediately became the Bank of Bengal. In this sector there are many banks involved like:1. Public banks 2. Private banks 3. Cooperative banks 4. foreign banks.

Banking in India originated

Functions of banks
Accepting deposits from public/ other(deposit) Lending money to public (loan) Transferring money from one place to another (Remittances) Keeping valuable in safe custody.
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OVERALL SCENERIO OF BANKING SECTOR IN ECONOMY (2009-2010) BANK CREDIT RATE:decreased. But later on due to reserve banks revised activity the interest rate was increased 13.9% against 22.0% and the non food bank rate was decreased year by year in the previous year 2009. Growth in aggregate deposits in 2009-10 was broadly compatible with the growth in the previous year. During 2009-10, public-sector banks (PSBs) were observed to be faring better in terms of growth in credit extended as compared to the deceleration in private banks and decline in foreign banks. Due to financial crises the bank credit rate was

INTEREST RATE:1. DOMESTIC DEPOSITRY RATE:- Interest rates offered by PSBs on

deposits of maturity of one year to three years declined from the 8.00-9.25 per cent range in March 2009 to 6.00-7.25 per cent in December 2009, while those on deposits of maturity of above three years came down from the 7.50-9.00 per cent range to the 6.25-7.75 per cent during the same period.

2. LENDING RATE:- The benchmark prime lending rates (BPLRs) of PSBs

moved from the 12.25-13.50 per cent range in March 2008 to 11.50-14.00 per cent in March 2009 and 11.00-13.50 per cent in December 2009 The BPLRs of PSBs, private-sector banks and foreign banks decreased from their September 2008 levels in March 2009 and further declined in December 2009.

HOUSING LOANS:- Banks were advised that loans granted to housing finance
companies (HFCs) for on-lending to individuals for purchase/construction of a dwelling unit per family be classified as housing loans under the priority sector, provided the housing loans granted by HFCs do not exceed Rs 20 lakh per dwelling unit. Eligibility under this measure was restricted to 5 per cent of the individual banks total priority-sector lending, on an ongoing basis. This special dispensation is made applicable for loans granted by banks to HFCs up to March 31, 2010.

KISAN CREDIT CARD SCHEME:- 5.24 The KCC scheme has become a widely
accepted mechanism for delivery of credit to farmers. The banking system has issued 878.30 lakh KCCs as of November 30,2009. The scheme now also covers borrowers of the long-term cooperative credit structure. The KCC has thus become a single window for a comprehensive credit product. The year-wise and agency-wise break up of the cards issued since inception.

FINANCIAL PERFORMANCE OF BANKS:-5.35 The balance sheets of SCBs in

India available as of 2008-09 indicate that the SCBs remained robust. However, the Indian banking sector was not completely insulated from the effects of the slowdown in the economy in 2008-09. 5.36 The consolidated balance sheets of SCBs expanded by 21.2 per cent as in end-March 2009 as compared to 25.0 per cent in the previous year. While the balance sheets of PSBs maintained their growth momentum, private-sector and foreign banks registered a deceleration in growth. The working results of SCBs under different categories are abstracted. During 2008-09, the growth rate of banks lending to industries, personal loans and services witnessed a deceleration, while the growth rate of banks lending to agriculture and allied activities increased substantially. Overall, the incremental creditdeposit (C-D) ratio declined sharply reflecting the slowdown in credit growth.

Table 1: Number of scheduled operating in India: 1989-90 to 2000-2001

commercial

banks

As at the end of 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 March Scheduled Commercial Banks (other than Regional Rural Banks) a. In 74 76 77 76 75 88 95 100 103 104 101 100 operation b. Data 74 76 77 76 74 86 92 100 103 104 101 100 covered Regional Rural Banks a. In 196 196 196 196 196 196 196 196 196 196 196 196 operation

b. Data 194 196 196 196 196 196 196 196 196 196 196 196 covered

MAJOR PLAYERS IN BANKING SECTOR

Introduction of RBI in India:-The Reserve Bank of India collects
various data/information from the banks through periodical returns/ statements. For processing these data on a computer system.

Market share of banks in India( in percent)

SOME OTHER MAJOR PLAYERS (PUBLIC):1. Punjab National Bank (PNB) 2. Central bank of India 3. Bank of India

PRIVATE BANKS:1. ICICI Bank 2. HDFC Bank 3. Standard charted bank 4. AXIS Bank

SERVICES OF BANK IN THREE YEAR (2008-09,09-10,1011)

In(2008):customer care service were launched in 2008 in form of SMS

through mobile by ICICI bank in July2008. And some additional services are also launched that was telecoms may start syphoning of traditional bank customers who dont need mortgages.

In(2009):In(2010):-

some additional services were launched through mobile again i.e.

some retail services were launched and the SMS facilities got merged into article. Revised rate of interest from 10.25% to 10.65% by VIJAYA BANK &

they have started a new vacancies for students. Union Bank and Nokia has been roll out of mobile payment service in December 2010 in a annual meet in Union Bank. In 2010 the FBI has passed a statistics of banking crime in Indian banks
Bank Crime
Federal Insured January 1 in 2010

.
(BCS)
Larcenies 5 0 0 1 2 8

Statistics

Financial Institutions Robberies 4997 47 103 396 3 5,546 Burglaries 57 4 2 11 0 74

Types of Bank
Commercial Banks Mutual Savings Banks Savings and Loan Associations Credit Unions Armored Company Total

Predicts 2010: Bank Services Hubs

(By Kristin Moyer in january 2010) Strategic Planning Assumption: By 2013, 90% of bank services hub initiatives that are planned or under way will need to be re-architected on a global basis

In(2011):- (By Syndicate Bank) Bank has launched a special Rainbow Package
CASA campaign from 01.09.2011.
RAINBOW PACKAGE CASA CAMPAIGN Bank launches a special CASA campaign from 1st of September 2011 across all its 2550+ branches in the Country. The campaign is aimed to bring in more new customers (both individuals & Business enterprises) into the Banks fold. The special attraction of this campaign is that the Bank offers Rainbow benefits/package to the Savings Bank customers, i.e. : 1. 2. 3. 4. 5. 6. 7. Instant global debit cards (VISA/Master) SyndSuraksha (Life Insurance cover against payment of premium ) Utility bill payment through payment gateway SMS Banking NEFT/RTGS facility Internet banking Any Branch Banking (ABB).

Open an SB account & avail bouquet of value added services offered on our savings account.

RBI guidelines on settlement of failed ATM transactions and free ATM transactions at other Bank ATMs effective from 01.07.2011 Card holder is entitled for compensation @ Rs.100 per day if the amount of claim is not credited to the account within 7 working days from the date of complaint. Customers are entitled for such compensation only if the claim is lodged with the issuing bank within 30 days from the date of transaction. Complaints related to failed ATM transactions to be resolved in 7 working days from the date of submission of complaint at the card issuing branch.
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TOTAL REVENUE OF THE BANK IN YEAR(2008-09,200910,2010-11)

year 2008-09 20092010 2010-11 total revenue(in crores) 3007.25 1741.78 2748.71

TOTAL REVENUE GENERATED:- The above figure has been taken

by the annual report of the Bank Of Baroda of year2008-09, 2009-10, 2010-11. The report has told the actual final position of the bank in different years and they have compared it with the year by year performance of the bank.
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PERFORMANCE OF BANKING OF SECTOR

Performance of all Banks up to March 2011 under the Annual Credit Plan 201011

Sector/Scheme Nos. of Districts Lead

Banks with Lead Bank Responsibilities SBI PNB CBI CAN 7 12 10 1 UCO BOB 4 2 UNION 2

RRBs Others AGT ** ** 38 69.06 100 100 48.50 87.36 137.57

ACP Achievement 79.57 77.42 75.53 100 (%) Share in Targets 22.07 10.51 9.29 5.00 (%) Contribution (%) 25.42 11.83 10.16 7.24 PMEGP-2010-11 (%)

81.05 77.09 97.32 3.61 2.55 4.24 2.84 1.82 2.57

61.66 55.26 20.79 24.36 17.00 18.7 34.18 * 141.74 * 90.07 60.67

46.52 64.71 57.50 63.19 75.83 67.46 78.63 36.20 86.51 53.09

SGSY55.28 76.91 61.23 100 Achievement (%)

KCC-Achievement 65.61 54.75 51.42 109.13 55.62 102.62 85.93 (%)

Performance of all Banks up to March 2010 under the Annual Credit Plan 2009-10

Sector/Scheme Nos. of Districts Lead

Banks with Lead Bank Responsibilities SBI 7 PNB 12 CBI 10 CAN 1 UCO 4 BOB 2 UNION 2

RRBs Others AGT ** ** 38 83.00 100 100 103.12 89.30

ACP Achievement 94.65 93.70 91.98 111.02 85.85 91.78 149.22 72.21 88.54 (%) Share in Targets 24.95 11.82 9.86 3.48 (%) Contribution (%) 28.45 13.34 10.93 4.65 SGSY55.93 54.55 60.81 76.34 Achievement (%) KCC80.24 72.77 73.36 85.90 Achievement (%) 3.3 3.41 2.7 2.99 1.72 3.09 16.92 25.25 15.33 17.81 66.87 *

310.88 65.42 80.00

79.22 101.81 105.03 83.04 *

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FLUCTUATION IN THE SERVICE OF BANK(Increased and decreased)

Reason for increased in the service of bank:1. Due to technological change the services in bank is increased day to day. 2.In year2008 the mobile facility has firstly been started it worked so efficiently in urban areas but it was not so efficient in rural areas so the bank has started some campaigns to aware the public. 3.The bank has sated a target and due to that they have contributed to achieve that so they have achieved the target of achieving it. 4.The latest technology is also used in working of banks and with the help of it the work of banks become so easy and it will take less time to complete any work.
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ANALYSIS
What will be the opinion for the sector as a manager?
Ans:- 1. As the SLR and CRR ratio of banks results some time in loss for the bank because some % of amount they have not allowed to gave loan on that so the bank rate has to be revised by the RBI. 2. The bank has to work hardly on its thurt areas like:

Credit delivery innovations o Micro finance initiatives o Kisan credit cards Restructuring co-operative

3. The minimum capital adequacy ratio has to be increased to take credit risk by the banks. 4. A strong banking team has to be made who can check only the transparency of work in the bank and they have to took a inspection in every bank time to time. 5. The bank has to adopt latest technology and have to update it time to time. 6. The bank has to be very transparent with their customers about their savings, investment & the legislatives of the bank.

CONCLUSIONS:Banking sector is a backbone of any country because of its concern towards the economy. They play a major part to generate the largest revenue to the country. As finance is needed for every small and large scale purposes so banking sector avail those resources to them. To measure the economical status or strength of any country and financial based organization we took help from the banking sector to identify it.

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REFERENCES:http://www.bankofindia.com/UserFiles/File/Bank%20of%20Ind ia%20AR%202011.pdf

http://www.google.co.in/

http://en.wikipedia.org/wiki/Bank

http://indiabudget.nic.in/

http://www.rbi.org.in/home.aspx

http://www.keralabanking.com/html/list_of_banks_having_we bsites.html

http://www.nos.org/Secbuscour/15.pdf

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