Banking Operation Ppt Presentation 1n4f1v

Presentation on

Public Sector & Private Sector Bank.

Presented To:

Prof. Prasad Joshi

By:

Somnath Pagar

Abhishek Mahale

What is Bank? Bank is a lawful organization, which accepts deposits that can be withdrawn on demand. It also lends money to individuals and business houses that need it.

Types of Bank

Commercial Bank DefinitionCommercial Banks are banking institutions that accept deposits and grant short-term, medium and long term loans and advances to their customers. Public sector banks – Majority stake is held by the Government of India or Reserve Bank of India. Ex – SBI, Bank of Baroda, Dena Bank, etc. Private sector banks – Majority of share capital of the bank is held by private individuals, ed as companies with limited liability. Ex – ICICI Bank, HDFC Bank, YES Bank etc.

Market Shares of Indian Financial Sectors

6% 4% 8%

19% 63%

Banks Insurance Companies Non-Banking Financial Institutions Mutual Funds Provident And Pension Funds

*Source: Banking Structure Report by- D. Subbarao.

Market Shares of Indian Banking Sectors 80 70 60 50 40 30 20 10 0

67.2

18.7

6.5

2.7

3.4

1.5

*Source: Banking Structure Report by- D. Subbarao.

Public & Private Sector Banking Structure State Bank of India Public Sector Banks (26)

Associates Banks (6) Nationalized (19)

Private Sector Banks (20+2)

Old Private Sector Banks (13) New Private Sector Banks (7+2)

New Banking Licenses issued by RBI in 2014  Infrastructure Development Finance Company(IDFC)  Bandhan Micro-finance

Licensing Policy The RBI issues bank licences under section 22 of the Banking Regulation Act, 1949. The licence enables the bank to do banking and other financial services activities listed in the Banking Regulation Act. For Public Sector & Private Sector Banks1) Eligible Promoters 2) Foreign shareholding in the bank – Not exceed 49 %. 3) Capital Requirement Minimum capital requirement Rs 1 Billion(1991) Minimum capital requirement Rs 3 Billion(2001) Minimum capital requirement Rs 5 Billion(2013)

Legal Framework for Banking At present, commercial banks are governed by the following six statutes The Banking Regulation Act, 1949  Banking Companies (Acquisition & Transfer of Undertaking) Act, 1970/1980  State Bank of India Act 1955  State Bank of India (Subsidiary Banks) Act, 1959  Industrial Development Bank (Transfer of Undertaking and Repeal) Act, 2003 and  The Companies Act, 2013 ( Old-1956).

Presence of Indian Public & Private banks abroad Indian banks are allowed to expand overseas under a policy framework of Reserve Bank of India and Government of India. In February 2005, RBI had come out with a press release stating that the applications from Indian banks for setting up representative offices / branches / subsidiary’s outside India. State Bank of India ed for the largest share (29.71%) in the total assets of the overseas branches of Indian banks as on March 31, 2013. Bank of Baroda with 20.53% Bank of India with 16.08% and ICICI Bank with 15.47%.

Spread across 17 countries.

Comparative Analysis: Public vs. Private Sector Banks Return on Assets and Return on Equity Bank Sector

Return on Assets

Return on Equity

2012-13

2013-14*

2012-13

2013-14*

SBI

0.78

0.89

13.24

15.25

Nationalised Banks*

0.74

0.88

12.34

14.65

SBI Group

0.88

0.94

15.29

14.95

Old Pvt. Sector Banks

1.26

1.42

16.22

17.05

New Pvt. Sector Banks

1.74

1.86

16.51

17.94

Public Sector Banks

Private Sector banks

Source: RBI Published data Notes: 1. Return on Assets = Net profit/Average total assets. 2. Return on Equity = Net profit/Average total equity. 3. *The data for 2014 is provisional. 4. * Nationalised banks include IDBI Bank Ltd.

Priority Sector Advances (Amount in

billion)

Notes: 1. Figures in brackets are percentages to ANBC or CE of OBE, whichever is higher, in the respective groups. 2. The data for 2014 is provisional. Source: RBI Annual Report 2014.

Ranking of Indian banks in the global league Name of Indian Bank

Ranking

SBI

38

ICICI Bank

99

HDFC Bank

126

Axis bank

175

PNB

189

BOB(Baroda)

206

*Source: http://brandirectory.com/league_tables/table/banking-500-2013

Thank You…!