Presented by :

Bharti Bhambhwani Swati Gupta (04) (11)

Introduction
The Banking Companies Act of 1949, define : A bank is a financial intermediary which accepts deposits and in turn converts the deposits into lending

Functions of Bank
Accepting deposit from people and others(deposit) Lending money to public (loan) Transferring money from 1 place 2 another Acting as a trustee Keeping valuables in safe custody Investment decisions and analysis Other types of lending and transaction Acts as a guarantor

Banking Sector in India

Banking structure in India

Public

Private

Co-operative

Rural

Foreign

Bank of Maharashtra Central Bank of India

ING Vysya Federal Bank

Saraswat Co-op TJSB

Marathwada Gramin Bank Thane Gramin Bank

HSBC Citibank

Commercial role of banking

Issue of banknotes (promissory notes issued by a banker and payable to bearer on demand) Processing of payments by way of telegraphic transfer, internet banking or other means Issuing bank drafts and bank cheques Accepting money on term deposit Lending money by way of overdraft, installment loan

Economic role of banking

Issue of money, in the form of banknotes and current accounts subject to cheque or payment at the customer's order. Netting and settlement of payments. Credit intermediation Credit quality improvement Maturity transformation

Pre Independence banking system of India

Banking in India originated in the last decades of the 18th century. The first banks were The General Bank of India which started in 1786, and the Bank of Hindustan, both of which 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 . This was one of the three presidency banks, the other two being the Bank of Bombay and the Bank of Madras, all three of which were established under charters from the British East India Company.

Indian merchants in Calcutta established the Union Bank in 1839, but it failed in 1848 as consequence of the economic crisis of 1848-49. The Allahabad Bank, established in 1865 and still functioning today, is the oldest Joint Stock bank in India. The presidency banks dominated banking in India but there were also some exchange banks and a number of Indian joint stock banks..The exchange banks, mostly owned by Europeans, concentrated on financing foreign trade. Indian joint stock banks were generally under capitalized and lacked the experience and maturity to compete with the presidency and exchange banks.

 The first entirely Indian joint stock bank was the Oudh Commercial Bank, established in 1881 in Faizabad. It failed in 1958. The next was the Punjab National Bank, established in Lahore in 1895, which has survived to the present and is now one of the largest banks in India.

Post Independence Banking system of India

In the post-independence period, India observed the emergence of large number of institutions for providing finance to different sectors of the economy. There were two nationalizations of banks in India, one in 1969 and the other in 1980. The entry activities of private sector and foreign banks were restricted through branch licensing and regulation norms. The over regulated and over administered polices eroded the capital base of most of the public Sector banks and recapitalization of 19 nationalized banks was made by government through of budgetary provision.

The other remarkable developments to enhance competition in banking sector reforms.. 1) It abolished administered interest rate regime by allowing banks to determine lending and deposit rates. 2) Competition has infused by allowing the operation of new private sector banks and more liberal entry of foreign banks. 3) Measures to broaden the ownership base of PSBs have also taken. 4) The system has also observed greater levels of transparency and standards of disclosure.

Future of Banking Sector in India

Mortgages to cross Rs 40 Trillion by 2020

Wealth management will be big business with 10x

growth The branches to grow by 2x and ATMs by 5x Mobile Banking to see huge growth New Models to serve Small and Medium Enterprise

Investment Banking to grow by 10 folds

Challenges
Financial Inclusion

Competition and consolidation

Resourse mobilization

Future for an MBA

Finance
Reorganizing the financial system Improvise their nose-dived profit graph

Marketing
Market Investment Product Direct selling agents

HR
Sustainability of bank Challenges in recruiting, training, and developing

Conclusion

Thank You