Growth in Banking Sector-(154)
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Transcript of Growth in Banking Sector-(154)
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Prepared byDivya Sharma
15412303910
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Indias banking sector is booming at a great pace.Indian banking sector has 6th rank in all over the
world.
Most of the banks paid their focus on the retailsector and provide internet banking, phone banking
and mobile banking services to their customers andhave cornered one of the largest segments of the
India's banking sector by targeting the India's growingmiddle income class.
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Cont.SBI has 6500+ ATMs all over the country.
ICICI bank has 3500+ ATMs all over the country.
RBI had printed 9,39,948 lakh crore notes till 6th november2011.
Acc. To business magazine survey, the no. of ATMs grew28% yearly.
Inspite of it India has 23+ ATMs per million people.
Transactions done through ATMs is around 70,000 crore ina year.
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BANK????
A bank is a financial institution whose primaryactivity is to act as payment agent for customersand to borrow and lend money.
An institution where one can place and borrowmoney and take care of financial affairs
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Functions of Banks
Accepting deposits from public/others.
Lending money to public.
Transferring money from one place to another.
Acting as trustees.
Keeping valuables in safe custody.
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Types of BanksPublic sector banks
Private sector banks
Co-operative banks
Development banks/financial institutions
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Public sector Banks in India
Central bank of IndiaCorporation bank
Dena bank
Bank of India
Indian overseas bank
Oriental bank of commercePunjab & sind bank
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Private sector Banks
ICICI bankIDBI bank
Axis bank
Foreign banks operating in India
HSBC bank
Citi bank
ABN-AMRO bank
Standard chartered bank
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Co-operative Banks The Co operative banks in India started functioning almost
100years ago. The Cooperative bank is an importantconstituent of the Indian Financial System. They are setupto provide easy loans to farmers or other persons to set uphis business. They are non profitable banks. Cooperativebanks in India finance rural areas under
FarmingCattleMilkHatcheryPersonal finance
Some example of co-operative banks in India IDBI BANK(INDUSTRIAL DEVELOPMENT BANK OF INDIA) IFCI BANK(INDUSTRIAL FINANCE COOPERATION OF INDIA)
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Development Banks/financial
institutionsThese banks are mainly used for developing industries
and countries.
Some examples are:
Federal bank
HDFC bank
HSBC
ICICI bank
Indian overseas bank
ING Vysya bank
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A glimpse of Banking sectorPhase 1
Early phase from 1786 to 1969 of Indian Banks
GENERAL BANK OF INDIA 1786(FIRST BANK)
RESERVE BANK OF INDIA 1935
SLOW GROWTH AND PERIODIC FAILURE
THE BANKING COMPANY ACT 1949
PEOPLE Mostly SAVE IN POSTAL DEPOSITSS
Ph 2
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Phase 2Nationalization of Indian Banks and up to 1991 prior to
Indian banking sector Reforms
Nationalization of imperial bank of India andformation of state bank of India(1955)
Nationalization of SBI and Subsidiaries(1960)
Insurance cover extended to deposits
Creation of credit guarantee corporation
Creation of regional rural banks
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Phase 3
New phase of Indian Banking System with the advent ofIndian Financial & Banking Sector Reforms after 1991
Entry of Foreign Banks
Phone Banking and Net-Banking
Shelter from external macroeconomic shock
System become more convenient and swift
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Major reforms initiatives
Some of the major reform initiatives in the last decadethat have changed the face of the Indian banking are:-
Interest Rate Deregulation-Interest
Government equity in banks
New private sector banks
New areas have been opened up for bank financing
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Effect of New Technologies on
Banks The Indian banking sector has seen an acceleration
with the introduction of technological transformationlike
ATMs, telephone banking,
online banking,
web based products,
e-cheques, credit cards,
debit cards.
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Guidelines for FDI in Banking
In the private banking sector of India, FDI is allowedup to a maximum limit of 74 % of the paid-up capitalof the bank.
Foreign Direct Investment and Portfolio Investment in
the public or nationalized banks in India are subjectedto a limit of 20 % in totality.
This ceiling is also applicable to the investments in theState Bank of India and its associate banks.
FDI limits in the banking sector of India wereincreased with the aim to bring in more FDI inflows inthe country along with the incorporation of advancedtechnology and management practices.
P I i B i
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Pro ems ace y In ian Ban ingsector
FDI in Indian banking sector resolves the followingproblems often faced by various banks in the country:
Inefficiency in management
Instability in financial matters
Innovativeness in financial products or schemes
Technical developments happening across variousforeign markets
Non-performing areas or properties
Poor marketing strategies
Changing financial market conditions
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Benefits of FDI in Banking Sector
in India
Transfer of technology from overseas countries to thedomestic market
Ensure better and improved risk management in thebanking sector
Assures better capitalization
Offers financial stability in the banking sector in India
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