Banking Sector in India

Introduction on Banking Sector

The Banking sector in India has always been one of the most preferred avenues of employment. In the current decade, this has emerged as a resurgent sector in the Indian economy. As per the McKinsey report ‘India Banking 2010’, the banking sector index has grown at a compounded annual rate of over 51 per cent since the year 2001, as compared to a 27 per cent growth in the market index during the same period. It is projected that the sector has the potential to account for over 7.7 per cent of GDP with over Rs.7,500 billion in market cap, and to provide over  1.5
million jobs.

Banks are defined as the  “Organizations which accepts deposits from the public and lend the same to persons, firms and companies for productive purposes. In the present time they are over and above this definition. Banks are providing innovative services with innovates styles. ATMs, Credit cards and Internet banking have changed the quality of delivery of services of banks. Banking services are growing with many new additions such as money transfers, Bancassurance, NRI services and so on. Promotion of service has been a challenging task. Banking services being of a sophisticated nature should be promoted carefully, clearly and innovatively.

Today, banks have diversified their activities and are getting into new products and services that include opportunities in credit cards, consumer finance, wealth management, life and general insurance, investment banking, mutual funds, pension fund regulation, stock broking services, custodian services, private equity, etc. Further, most of the leading Indian banks are going global, setting up offices in foreign countries, by themselves or through their subsidiaries.

As reported in the Economic Times, the country’s leading public sector bank, State Bank of India has plans to recruit 25,000 employees in the year 2009. Besides, its life insurance venture, SBI Life, has plans to hire 13,000 agents and 200 sales managers. Also, Punjab National Bank, the country’s second largest public sector lender, and Union Bank of India have plans of hiring 5,000 people each. The financial year 2008-09 has already shown the banking sector to be among the largest job providers in the country with over 50,000 vacancies being notified and filled up in the public sector banks alone.

Significantly, the RBI has the tenth largest gold reserves in the world after spending US$ 6.7 billion for the purchase of 200 metric tonnes of gold from the International Monetary Fund (IMF). The purchase has increased RBI’s share of gold holdings from approximately 4 per cent to about 6 per cent.

Following the recent financial crisis, new deposits have gravitated towards the public sector banks. According to RBI’s ‘Quarterly Statistics on Deposits and Credit of Scheduled Commercial Banks: June 2009′, nationalised banks, as a group, accounted for 49.7 per cent of the aggregate deposits, while State Bank of India (SBI) and its associates accounted for 24.2 per cent. The share of other scheduled commercial banks, foreign banks and regional rural banks in aggregate deposits were 17.5 per cent, 5.6 per cent and 2.9 per cent, respectively.

With respect to gross bank credit also, nationalised banks hold the highest share of 50.4 per cent in the total bank credit, with SBI and its associates at 23.5 per cent and other scheduled commercial banks at 18.0 per cent. Foreign banks and regional rural banks had a share of 5.7 per cent and 2.4 per cent respectively in the total bank credit.

The report also found that scheduled commercial banks served 34,676 banked centres. Of these centres, 28,167 were single office centres and 62 centres had 100 or more bank offices.

The confidence of non-resident Indians (NRIs) in the Indian economy is reviving again. NRI deposits have increased by nearly US$ 3.7 billion in the first four months of 2009-10, despite the volatile movements in the interest rates. NRI fund inflows increased since April 2009 and touched US$ 45.33 billion till July 2009, as per the RBI’s September bulletin. Most of this has come through Foreign Currency Non-resident (FCNR) accounts and Non-resident External Rupee Accounts. India’s foreign exchange reserves rose to US$ 281.861 billion as on October 9, 2009 as against US$ 253.0 billion in April 10, 2009.

India has finalised negotiations for a US$ 2 billion loan from the World Bank to help recapitalise state-run banks.

List of Banks in India:

Nationalised Banks:

• 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 and Sind Bank
• Punjab National Bank
• Syndicate Bank
• UCO Bank
• Union Bank of India
• United Bank of India
• Vijaya Bank
• State Bank of India

Private Banks:

• Axis Bank
• Bank of Rajasthan
• Development Credit Bank
• Dhanalakshmi Bank
• Federal Bank
• HDFC Bank
• ICICI Bank
• IndusInd Bank
• INGVysya Bank
• Kotak Mahindra Bank
• Laxmi Vilas Bank
• South Indian Bank
• Tamil Nadu Merchantile Bank
• Yes Bank

Foreign Banks:

• ABN- AMRO Bank
• Abu Dhabi Commercial Bank
• American Express Bank
• Bank of America
• Barclays Bank
• BNP Paribas
• Citibank
• DBS Bank
• Deutsche Bank
• HSBC Bank
• JP Morgan Chase Bank
• Standard Chartered Bank
• State Bank of Mauritius

Source: www.time4education.com/career_in_banking.asp

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Related posts:

1. History of Banking Sector in India
2. State Bank of India
3. Forms of E-Banking
4. What is Life Insurance ?
5. Impact of Recession on Real Estate in India

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