: Accepting, for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise and

withdrawable by cheques, draft, order or otherwise. A bank is an institution that deals with money and Credit. However, in reality Banks are service organisations selling banking services. Economic importance: Contribution to GDP 4.7% Employing approx. 1.5million employees Slide 3: 1870 Bank of Hindustan First Bank Presidency Banks - Bank of Calcutta, Bank of Bombay and Bank of Madras 1921 - All 3 banks amalgamated and became Imperial Bank of India 1934 RBI was Constituted 1949 RBI came under government control 1955 Imperial Bank became State bank of India Slide 4: Post Independence The Banking Regulation Act provided that no new bank or branch of an existing bank may be opened without a licence from the RBI, and no two banks could have common directors. Nationalization Nationalisation of the 14 largest commercial banks Liberalisation Liberalisation Policy was implied which gave licences to a small number of private banks. Relaxation in the norms for Foreign Direct Investment Slide 5: Banking: A Bank is a financial institution licensed by a government. Its primary activities include borrowing and lending money. It provides Services like Credit card, debit card , interest on deposits, Finance: A financial institution provides financial services for its clients or members. Probably the most important financial service provided by financial institutions is acting as financial intermediaries. Most financial institutions are highly regulated by government bodies Slide 6: The banking activities can be classified as : Accepting Deposits from public/others (Deposits) Lending money to public (Loans) Transferring money from one place to another (Remittances) Acting as trustees Acting as intermediaries Keeping valuables in safe custody Collection Business Government business Slide 10: Keeping money safe while also allowing withdrawals when needed Issuance of check books so that bills can be paid and other kinds of payments can be delivered by post Provide personal loans, commercial loans, and mortgage loans (typically loans to purchase a home, property or business) Issuance of credit cards and processing of credit card transactions and billing Issuance of debit cards for use as a substitute for checks Allow financial transactions at branches or by using Automatic Teller Machines (ATMs) Provide wire transfers of funds and Electronic fund transfers between banks Facilitation of standing orders and direct debits, so payments for bills can be made automatically Provide overdraft agreements for the temporary advancement of the Bank's own money to meet monthly spending commitments of a customer in their current account. Provide Charge card advances of the Bank's own money for customers wishing to settle credit advances monthly. Provide a check guaranteed by the Bank itself and prepaid by the customer, such as a cashier's check or certified check. Notary service for financial and other documents Slide 12: Allahabad Bank | Andhra Bank | Bank of Baroda | Bank of India | Bank of Maharashtra | Canara Bank | Central Bank of India | Corporation Bank | Dena Bank | Indian Bank | Indian Overseas Bank | Oriental Bank of Commerce | Punjab & Sind Bank | Punjab National Bank | State Bank of India | Syndicate Bank | UCO Bank | United Bank of India | Union Bank of India | Vijaya Bank Slide 13: Old generation private banks New generation private banks Foreign banks operating in India Scheduled co-operative banks Non-scheduled banks Examples: Bank of Punjab | Bank of Rajasthan | Catholic Syrian Bank | Centurion Bank | City Union Bank | Dhanalakshmi Bank | Development Credit Bank | Federal Bank | HDFC Bank | ICICI Bank | IDBI Bank | IndusInd Bank | ING Vysya Bank | Jammu & Kashmir Bank | Karnataka Bank | Karur Vysya Bank | Laxmi Vilas Bank | South Indian Bank | United Western Bank | UTI Bank Slide 14: Categories: State co-operative Banks Central co-operative banks Primary Agriculture Credit Societies They are governed by the Banking Regulations Act 1949 and Banking Laws (Co-operative Societies) Act, 1965. Some facts about Cooperative banks in India Some cooperative banks in India are more forward than many of the state and private sector banks. The total deposits & lendings of Cooperative Banks in India is much more than Old Private

Sector Banks & also the New Private Sector Banks. This exponential growth of Co operative Banks in India is attributed mainly to their much better local reach, personal interaction with customers, and their ability to catch the nerve of the local clientele. Slide 15: IFCI IDBI ICICI IIBI SCICI Ltd. NABARD Export-Import Bank of India National Housing Bank Small Industries Development Bank of India North Eastern Development Finance Corporation Slide 16: SBI has 30 Regional Rural Banks in India known as RRBs. Till date in rural banking in India, there are 14,475 rural banks in the country of which 2126 (91%) are located in remote rural areas. RRBs are banks which functions for the development of the rural areas in India. Few of them are as follows. Haryana State Cooperative Apex Bank Limited NABARD Sindhanur Urban Souharda Co-operative Bank United Bank of India Slide 17: Banking channels are of the following types : Proxy Banking ATM Mobile/ Tele Banking/SMS Banking Internet Banking/E-Banking Merchant Banking Slide 18: This kiosk has been set up by ICICI Bank in partnership with network n-Logue Communications in remote villages of Southern part of the country. This is known as Proxi Banking. With the help of fibre optic cables, this kiosk works on wireless in local loop technology . Benefits to rurals Small loans given for buying buffaloes. Loans for setting up a tea shop. Life and non-life insurance provided. Weather insurance given to farmers. Insurance policies sold to farmers like groundnut, castor, soya, paddy crop, etc. Slide 19: A mobile hand set with a connection is the only instrument needed to make a gateway to your banking transaction, the latest innovation of technology . Mobile Banking, SMS Banking, Net Banking and ATMs are the major services by the banks in India. Slide 20: The first bank to introduce the ATM concept in India was the Hongkong and Shanghai Banking Corporation (HSBC ) in the year 1987 The first bank to cross 1,000 marks in installing ATMs in India is ICICI . The Corporation Bank has the second largest network of ATMs amongst the Public Sector Banks in India . The Indian banks have also come up with a 'Swadhan' scheme. Under this scheme, the banks can use each other's ATM at a cost, usually Rs. 35 extra from their customers. Cost of setting ATM center Approximately Rs.1mn it takes for the setting of an ATM center. Rs.1.2-1.4mn per annum is needed for its maintenance. To keep the cost in equilibrium position, there should be around 250-300 transactions per day per ATM. Slide 21: With mobile banking facilities, one can bank from anywhere, at anytime and in any condition or anyhow. The system is either through SMS or through WAP. Services offered on Mobile: Bill payments Fund transfers Check balances Any many more which is also available in SMS Banking Slide 22: Balance enquiry Last three transactions Cheque payment status Cheque book request Statement request Demat Free Balance Holding Demat - Last two Transactions Bill Payment SMS banking is also very much safe. First, one authenticates the mobile number with the authentications key. Second, the customer uses secret Mobile Personal Identification Number (MPIN). Slide 23: Features of Net banking: The banks offer only relevant information about their products and services to the mass. Few banks provide interaction facility between the banks and its customers. Banks are coming up with arrangements of utility payments, like telephone bills, electricity bills, etc. Cost of installation of services The cost for providing such services to the banks come around Rs 40 lakh to Rs 50 lakh. Slide 24: Queries Check Balance See Statement Inquire about cheque status Ask for a Statement Ask for a Cheque Book Security Token devices Inquire about Fixed Deposit Inquire about TDS details See Demat Account Update profile

Transactions Stop a Cheque Pay Bills Ask for a Demand Draft Transfer funds between your accounts Transfer funds to a third party Request for a new Fixed Deposit Shop Online Pay Bank Credit Card Dues Slide 25: Bank Name Technology Vendor Service offering ABN AMRO Bank Infosys (BankAway) Net Banking Bank of India Iflex BOIonline Citibank Orbitech (now Polaris) Citibank Online Corporation Bank I-flex CorpNet Federal Bank Sanchez FedNet Global Trust Bank Infosys (BankAway) ibank@gtb HDFC Bank i-flex/ Satyam Net Banking HSBC Online@hsbc ICICI Bank Infosys, ICICI InfoTech Infinity IDBI Bank Infosys (BankAway) i-net banking IndusInd Bank CR2 Indus Net Standard Chartered Bank In-House Me Standard Chartered Online State Bank of India Satyam/Broad vision onlinesbi.com UTI Bank Infosys (BankAway) iConnect Slide 27: For setting up a new bank in India, the RBI cane out with new guidelines in Jan 2001, as follows: Minimum Net-worth requirement for private banks Rs.200 Crores NBFCs of high net-worth and good track record to convert themselves into regular banks. It is necessary for promoters to have minimum net-worth of Rs.200 Crores to set up a bank but they should raise it to Rs.300 Crores in three years. They should have NPAs of less than 5% and Capital Adequacy Ratio (CAR) above 12%. Triple credit rating is also needed. Corporates will not be permitted to setup banks irrespective of their net-worth. New Banks cannot set up a subsidiary or mutual fund during the initial 3 years. The newly licensed banks have to observe all existing requirements of priority sector. Additionally, they should commit to having 25% of their branches in the rural and semi-urban areas. Slide 28: Sources: Deposits from public: Saving deposit Current deposit Fixed deposits Borrowings from Banks: Interbank borrowings Interbank deposits Borrowings from RBI: Borrowings from financial institutions Borrowings from abroad Paid up capital/Reserves Uses: Term Loans Overdraft Cash credit Loans and advances Packing credit Bill purchase and discounting Inland and foreign investment Approved securities and other shares & securities Slide 29: Abn Amro Bank In India Allahabad Bank In India American Express Bank In India Andhra Bank In India Bank Of India Canara Bank Central Bank Of India CITI Bank Corporation Bank HDFC Bank HSBC Bank ICICI Bank IDBI Indian Overseas Bank Oriental Bank Of Commerce Punjab National Bank State Bank Of India (SBI) Standard Chartered Bank United Bank Of India Axis bank Slide 30: Currently, India has: 88 scheduled commercial banks (SCBs) 28 public sector banks (that is with the Government of India holding a stake) 29 private banks (these do not have government stake; they may be publicly listed and traded on stock exchanges) 31 foreign banks. They have a combined network of over 53,000 branches and 17,000 ATMs. According to a report by ICRA Limited, a rating agency, the public sector banks hold over 75 percent of total assets of the banking industry, with the private and foreign banks holding 18.2% and 6.5% respectively. Slide 31: Demat account Sb a/c -Savings bank account CA a/c - Current account Salary Account Recurring deposit account Overdue account - OD a/c Fixed deposit account Proprietorship account Partnership account Firm account Company account Slide 32: At the time of opening of a new deposit account of a senior citizen, the branch should satisfy about the age through verification of any of the following documents:- Affidavit-cum-indemnity PAN Card Photo ID issued by PSUs to retired persons Ration Card Secondary School Leaving Certificate indicating date of Birth LIC Policy Voters Identity Card Pension Payment Order Birth Certificate issued by the competent authority Passport Slide 33: The first bank in India to be given an ISO Certification Canara Bank The first Indian bank to have been started solely with Indian capital Punjab National Bank The first among the private sector banks in Kerala to become a scheduled bank in 1946 under the RBI Act South Indian Bank India's oldest, largest and most successful commercial bank, offering the widest possible range of domestic, international and NRI products and services, through its vast network in India and overseas State Bank of India India's second largest private sector bank and is now the largest scheduled commercial bank in India The Federal Bank Limited Bank which started as private shareholders banks, mostly Europeans shareholders Imperial Bank of India The first Indian bank to open a branch outside India in London in

1946 and the first to open a branch in continental Europe at Paris in 1974 Bank of India, founded in 1906 in Mumbai The oldest Public Sector Bank in India having branches all over India and serving the customers for the last 132 years Allahabad Bank The first Indian commercial bank which was wholly owned and managed by Indians Central Bank of India Slide 34: MICR (Magnetic Ink Character Recognition): To make National Electronic Fund Transfer quick and efficient RBI introduced 9 digit MICR code 3 digit corresponds to city code, next 3 digit to bank code and later 3 digit to branch code. IFSC stands for Indian Financial System Code. The code consists of 11 Characters First 4 characters represent the entity; Fifth position has been defaulted with a '0' (Zero) for future use; and the Last 6 character denotes the branch identity. Slide 36: Strength Support from the government Financial assistance Weakness Too many small Banks Regulatory environment Opportunities Electronic forms of business Technology Untapped market Young India &rising standard of living Globalization Threats Investment of foreign banks Unorganized money lending market Threat of nationalization Slide 37: Reserve Bank of India (RBI) announced the Monetary Policy for the year 2009-10: RBI has cut Repo rate by 25bps from 5.0% to 4.75%. Reverse Repo rate has been cut by 25bps from 3.5% to 3.25%. The bank rate is left unchanged at 6.0%. The CRR has been left untouched at 5.0%. Slide 38: Bankers Book Evidence Act, 1891 The Hire-Purchase Act, 1972 The Industrial Disputes (Banking and Insurance Companies) Act, 1949 The Industrial Disputes (Banking Companies) Decision Act, 1955 Introduction to Law of Negotiable Instruments Negotiable Instruments by Avtar Singh Banking, Public Financial Institutions & Negotiable Instruments Laws (Amend.) Act, 1988 by EBC Company Secretaries Act, 1980 by EBC National Housing Bank Act, 1987 by EBC Negotiable Instruments Act, 1881 by EBC Regional Rural Banks Act, 1976 by EBC Recovery of Debts due to Banks and Financial Institutions Act, 1993 with Debts Recovery Tribunal (Procedure) Rules, 1993 by EBC Small Industries Development Bank of India Act, 1989 by EBC Industrial Development Bank of India Act, 1964 by EBC Export Import Bank of India Act, 1981 by EBC Banking, Public Financial Institutions & Negotiable Instruments Laws (Amend.) Act, 1988 by EBC Reserve Bank of India Act, 1934 by EBC