INDIAN BANKING ..……..SECTOR……….

CONTANTS• • Bank • • History of Bank • • Types of Bank Sectors• • Definition of Public Sector Banking • • Definition of Private Sector Banking• • Definition of Cooperative Sector Banking • • Rural Banking • • Foreign Banks in India

Cont…

• • Top 10 Banks in India • • Co-operative banking structure in India.• • Differences Between Public & Private Sector

Banks• • Main Competitors• • Present Scenario• • STATE BANK OF INDIA (Public Sector Bank)• • HDFC BANK (Private Sector Bank)

BANK

• The word of bank is derived from the Italian banca, which is derived from German and mean bench.

• The term bankrupt and broke is similarly derived from banca rotta.

• Which refers to an out of business bank, having its bench physically broken.

• Money lenders in Northern Italy originally did business in open areas or big open rooms with each lender working from his own bench or table.

HISTORY OF BANK

• Banking in the modern sense of the word can be traced to medieval and early Renaissance Italy, to the rich cities in the north like Florence, Venice and Genoa.

• The Bardi and Peruzzi families dominated banking in 14th century Florence, establishing branches in many other parts of Europe. Perhaps the most famous Italian bank was the Medici bank, set up by Giovanni Medici in 1397.

• The earliest known state deposit bank, Banco di San Giorgio (Bank of St. George), was founded in 1407 at Genoa, Italy.

List of banks in India• 1 Nationalized banks– 1.1 Central bank– 1.2 State Bank of India & associates (also

nationalized)– 1.3 Nationalized banks– 1.4 Old private sector banks– 1.5 New private sector banks– 1.6 Foreign banks operating in India

Cont…• 2 Co-operative Banks– 2.1 Scheduled Urban Co-operative Banks– 2.2 Non-Scheduled Urban Co-operative Banks– 2.3 Indian Banks with business outside India– 2.4 Foreign banks with business in India• 2.4.1 Foreign Banks with Representative Offices

in India

Nationalized banks• Central bank• Reserve Bank of India

• State Bank of India & associates (also nationalized)• State Bank of Hyderabad• State Bank of Indore (now merged into state bank of India)• State Bank of Mysore• State Bank of Patiala• State Bank of Saurashtra (Now merged into State Bank of

India)• State Bank of Travancore• SBI is a nationalized bank.

Cont…• Allahabad Bank• Andhra Bank• Bank of Baroda• Bank of India• Bank of Maharashtra• Canara Bank• Central Bank of India• Corporation Bank• Dena Bank• IDBI Bank• Indian Bank• Indian Overseas Bank

Foreign banks operating in India• ABN AMRO Bank N.V.• Abu Dhabi Commercial Bank• American Express Bank• Arab Bangladesh Bank• Bank International Indonesia• Bank of America NA• Bank of Bahrain and Kuwait B.S.C.• Bank of Ceylon

PUBLIC SECTOR BANKS

• All government owned banks fall in this variety. • Besides the Reserve Bank of India, the State Bank of

India and its associate banks and about 20 nationalized banks, all comprises of the public sector banks.

• Many of the regional rural banks that are funded by the government banks can also be clubbed in this genre.

PRIVATE SECTOR BANKS

• A new wave in the banking industry came about with the private sector banks in India.

• With policies on liberalization being generously taken up, these private banks were established in the country that also contributed heavily towards the growth of the economy and also offering numerous services to its customers.

• Some of the most popular banks in this genre are: Axis Bank, HDFC Bank, ICICI Bank, Kotak Mahindra Bank and SBI Commercial and International Bank.

• The Foreign Banks in India like HSBC, Citibank, and Standard Chartered bank etc can also be clubbed here.

COOPERATIVE BANKING SECTOR

• Cooperative banks are owned by their customers and follow the cooperative principle of one person, one vote.

• Unlike credit unions, however, cooperative banks are often regulated under both banking and cooperative legislation.

• They provide services such as savings and loans to non-members as well as to members and some participate in the wholesale markets for bonds, money and even equities.

• Many cooperative banks are traded on public stock markets, with the result that they are partly owned by non-members.

Rural banking• •Rural banking in India started since the establishment of banking

sector in India. Rural Banks in those days mainly focussed upon the agro sector.

• •The Haryana State Cooperative Apex Bank Ltd. commonly called as HARCOBANK plays a vital role in rural banking in the economy of Haryana State and has been providing aids and financing farmers, rural artisans, agricultural labourers, entrepreneurs, etc. in the state and giving service to its depositors.

• •National Bank for Agriculture and Rural Development (NABARD) is a development bank in the sector of Regional Rural Banks in India. It provides and regulates credit and gives service for the promotion and development of rural sectors mainly agriculture, small scale industries, cottage and village industries, handicrafts.

Foreign banks in India

• •Foreign Banks in India always brought an explanation about the prompt services to customers. After the set up foreign banks in India, the banking sector in India also become competitive and accurative.

• •New policies are introduced by RBI for them –The policy conveys that foreign banks in India may not acquire Indian ones (except for weak banks identified by the RBI, on its terms) and their Indian subsidiaries will not be able to open branches freely.

Top 10 Banking in Public & Private Sector Banking

• 1. State Bank of India (SBI)

• 2. HDFC Bank

• 4. ICICI Bank

• 5. Punjab National bank(PNB)

• 6. UTI Bank (AXIS Bank)

• 7. Hongkong & Shanghai Banking Corp(HSBC)

• 8. Kotak Mahindra Bank

• 9. Sundaram Bank

• 10. Oriental Bank of Commerce

Co-operative Banking Structure in India is Divided into Five

• 1. Primary Urban Co-operative Banks.• 2. Primary Agricultural Credit Societies.• 3. District Central Co-operative Banks.• 4. State Co-operative Banks.• 5. Land Development Banks.

DIFFERENES BETWEEN PUBLIC & PRIVATE SECTOR BANKS

• Public Sector bank means any Government Sector Bank/Institute that goes public... means that issues it share to general public.. It also has a greater share of government(more than 50%) so that the main motto of social welfare other than Maximising Profit remains.

• Where as Private Sector Banks are those Banks where the management is controlled by Private individuals and Government does not have any say in the management of these banks. Maximising profit is the basic motto.

Main competitors for banking sector

• •Post offices.• •Mutual fund• •Share market• •Insurance.• •Money lenders• •Family and friends

Present scenario• •Banking industry has been undergoing a rapid transformation.

•Banks today are market driven and market responsive.

• •With the entry of new players and multiple channels, customers (both corporate and retail) have become more discerning and less "loyal" to banks.

• This makes it imperative that banks provide best possible products and services to ensure customer satisfaction.

• •They have been managing a world of information about customers - their profiles, location, needs, requirements, cash positions, etc.

Cont…

• •They are focusing on region-specific campaigns rather than national media campaigns as effective strategy for a diverse country like India.

• •Customer-centricity also implies increasing investment in technology.

• •Apart from the Mobile Banking, including of SMS Banking, Net Banking and ATMs are the major steps taken by the banks in India towards modernization.

Services given by banks

• •Demat account• •Lockers• •Cash management• •Insurance product• •Mutual fund product• •Loans• •ECS(Electronic clearance system)• •Taxes

STATE BANK OF INDIA (PUBLIC SECTOR BANK)

• The State Bank of India, popularly known as SBI, is one of the leading banks in India. The bank traces its origin to the first decade of the 19th century. Later on, it was merged with the Imperial Bank. In the year 1955, the Government of India nationalized the Imperial Bank along with the Reserve Bank of India. Ever since that time, the bank acquired its present name that is SBI.

• The State Bank of India is India's largest commercial bank. The bank has been striving sincerely to adhere to the efforts of providing utmost customer satisfaction to the best possible

CONT…

• Head quarters Mumbai, Maharashtra, India • Key people O. P. Bhatt(Chairman)• Products Investment Banking, Consumer Banking, • Commercial Banking, Retail Banking, • Private Banking, Asset Management• Pensions ,Mortgages, Credit Cards• Revenue ▲ 85,962.07 crore (US$18.65 billion) (2010) • Profit ▲ 9,166.05 (US$198.9) (2010) • Total assets ▲ $323.04 billion (2010) • Total equity ▲ $18.519 billion (2010)• Owner(s) Government of India

Rating Given By Moody To SBI.

• "The rating action considers SBI's capital situation and deteriorating asset quality.

• Our expectations that non-performing assets (NPA) are likely to continue rising in the near term .

• due to higher interest rates and a slower economy - have caused us to adopt a negative view on SBI's creditworthiness," said Beatrice Woo.

Cont…• On the asset quality front, the bank's NPA, as of

June 30, 2011, reached a three-year high of 3.52% of loans and 277,68 crore on an absolute basis.

• For the system, the ratio was 2.3% as of March 31, 2011. Against a backdrop of a slowing economy and higher interest rates, the rising trend evident in SBI's new NPA formation rate since the third quarter of FY11 will continue.

HDFC BANK (PRIVATE SECTOR BANK)

• The State Bank of India, popularly known as SBI, is one of the leading banks in India. The bank traces its origin to the first decade of the 19th century. Later on, it was merged with the Imperial Bank. In the year 1955, the Government of India nationalized the Imperial Bank along with the Reserve Bank of India. Ever since that time, the bank acquired its present name that is SBI.

• The State Bank of India is India's largest commercial bank. The bank has been striving sincerely to adhere to the efforts of providing utmost customer satisfaction to the best possible

CONT…• • Headquarters Mumbai, India• • Key people Jagdish Capoor (Chairman)• Aditya Puri (MD)• • Products Investment Banking, Commercial Banking,• Retail Banking, Private Banking,• Asset Management, Mortgages, • • Credit Cards• • Revenue ▲ 20,266.99 crore (US$4.4 billion) (2010)• • Operating income ▲ 4,419.01 crore (US$958.93 million)

(2010)• • Profit ▲ 3,032.92 crore (US$658.14 million) (2010)• • Total assets ▲ US$ 39.723 billion (2009)• • Total equity ▼ 21,158.15 crore (US$4.59 billion) (2010) • • Employees 51,888 (2010)