Presented By

Dr. Vishav Prakash Saini(355)

Amrit Rajan Prasad(358)

Commercial Banks and

It’s Recent Development

Structure of Banking System in India

Scheduled Banks Non-Scheduled Banks

Central Coop. Banks and primary credit

societies

Commercial Banks

State Coop. Banks

Commercial Banks

Public Sector Banks Private Sector Banks Foreign Banks(31)

SBI &Associate Banks(7)

Other Nationalized

Banks(20)

Old(17) New(8)

Definition of Commercial Banks• An institution which accepts deposits,

makes business loans, and offers related services.• Commercial banks also allow for a variety

of deposit accounts, such as checking, savings, and time deposit.

• These institutions are run to make a profit and owned by a group of individuals.

• Commercial banks offer services to individuals, they are primarily concerned with receiving deposits and lending to businesses.

Functions of Commercial Bank• Primary Functions– Accepting Deposits

• Current Deposits;• Saving Deposits;• Fixed deposits;• Recurring Deposits;• Miscellaneous Deposits.

– Granting Loans and Advances.• Short-term Loans

– Cash Credit;– Overdraft;– Discounting of Bills.

• Long-term Loans– Demand Loan;– Term Loan.

Functions of Commercial Bank Continue……• Secondary Functions– Agency Services

• Collection and payment of cheques and bills on behalf of the customer;

• Collection of dividends, interest and rent, etc. on behalf of the customer, if so instructed by them;

• Payment of rent, interest, insurance premium, etc. on behalf of customers, if so instructed;

• Acting as agents or correspondents on behalf of customers for other banks and financial institutions at home and abroad.

– General utility Services• Issuing letters of credit and travelers' cheques;• Underwriting of shares, debentures, etc.;• Safe-keeping of valuables in safe deposit locker;• Supplying trade information and statistical data useful to

customers;• Acting as a referee regarding the financial status of customers;• Undertaking foreign exchange business.

Commercial Banks at a glance

Sl. No. Name of bank Year of incorporation

1 State Bank of Bikaner & Jaipur

1966

2 State Bank of Hyderabad 1941

3 State Bank of India 1955

4 State Bank of Indore 1960

5 State Bank of Mysore 1913

6 State Bank of Patiala 1917

7 State Bank of Travancore 1945

State bank of India and its associates

Sl. No. Name of bank Year of incorporation

1 Allahabad Bank 18652 Andhra Bank 19233 Bank of Baroda 19084 Bank of India 19065 Bank of Maharashtra 19356 Canara Bank 19067 Central Bank of India 19118 Corporation Bank 19069 Dena Bank 1938

10 IDBI Bank Ltd 199411 Indian Bank 190712 Indian Overseas Bank 193713 Oriental Bank of Commerce 194314 Punjab & Sind Bank 190815 Punjab National Bank 189516 Syndicate Bank 192517 UCO Bank 194318 Union Bank of India 191919 United Bank of India 195020 Vijaya Bank 1931

Nationalized Commercial Banks

Sl. No. Name of bank Year of incorporation

1 Catholic Syrian Bank 1920

2 City Union Bank 1904

3 Development Credit Bank 1995

4 Dhanalakshmi Bank 1927

5 Federal Bank 1931

6 ING Vysya Bank 1930

7 Jammu & Kashmir Bank 1938

8 Karnataka Bank 19249 Karur Vysya Bank 1926

10 Lakshmi Vilas Bank 1926

11 Lord Krishna Bank 194012 Nainital Bank 1922

13 Ratnakar Bank 1943

14 Sangli Bank 1948

15 SBI Comm. & Intl. Bank 199316 South Indian Bank 1929

17 Tamilnad Mercantile Bank 1921

Old Private Sector Commercial Banks

Sl. No. Name of bank Year of incorporation

1 Centurion Bank 1994

2 HDFC Bank 1994

3 ICICI Bank 1994

4 IndusInd Bank 1995

5 Kotak Mahindra Bank 1985

6 Axis Bank 1994

7 Yes Bank 2003

New Private Sector Commercial Banks

Recent Development in Commercial Banking

• Interest rate deregulation• Electronic Clearing Services (ECS)• Electronic Funds Transfer (EFT)• The opening of new clearing houses,

interconnection of clearing houses through the Indian Financial Network (INFINET)

• The development of a Real-Time Gross Settlement (RTGS) System

• Centralized Funds Management System (CFMS)

Continue……….

• E-banking• E-payment• Automated teller machines(ATM)• Negotiated Dealing System (NDS)• The Structured Financial Messaging

System(SFMS).

Growth of Commercial Banks

21-05-2010 22-05-2009 23-05-2008

Aggregate Deposits of Residents(1+2)

44,59,788 39,02,674 31,77,793

1. Demand Deposits 5,73,356 5,09,968 4,51,609

2. Time Deposits of Residents(2.1+2.2)

38,86,432 33,92,706 27,26,184

2.1 Short-term Time Deposits

17,48,894 15,26,718 12,26,783

2.2 Long-term Time Deposits

21,37,537 18,65,988 14,99,401

Funding from Financial Institutions

1,15,192 1,04,429 1,04,075

Source: Reserve Bank Of India

Branches and ATMs of Scheduled Commercial Banks (As at end-March 2009)

Bank Group Number of Bank/Branches Number of ATMs Off-siteATMs

aspercentage oftotal

ATMs

ATMs as percent age of Branches

Rural Semi-urban

Urban Metro politan

Total On-siteOff- site Total

1 2 3 4 5 6 7 8 9 10 11i) Nationalised Banks 13,381 8,669 8,951 8,375 39,376 10,233 5,705 15,938 35.8 40.2

ii) State Bank Group 5,560 4,835 3,043 2,624 16,062 7,146 4,193 11,339 37.0 29.0

iii) Old Private Sector Banks

842 1,554 1,344 933 4,673 1,830 844 2,674 31.6 56.9

iv) New Private Sector Banks

271 1,084 1,371 1,478 4,204 5,166 7,480 12,646 59.2 296.6

v) Foreign Banks 4 4 52 233 293 270 784 1,054 74.4 357.3

Total (i to v) 20,058 16,146 14,761 13,643 64,608 24,645 19,006 43,651 43.5 67.0

Transactions through Retail Electronic Payment MethodsType

Volume of transactions (000’s) Growth in

volume (per cent)

Value of transactions (Rs. crore)

2006-07 2007-08 2008-09 2007-08

2008-09 2006-07 2007-08 2008-09

1 2 3 4 5 6 7 8 9

1. ECS-Credit 69,019 78,365 88,394 13.5 12.8 83,273 7,82,222 97,487

2. ECS-Debit 75,202 1,27,120 1,60,055 69.0 25.9 25,441 48,937 66,976

3. EFT/ NEFT 4,776 13,315 32,161 178.8 141.5 77,446 1,40,326 2,51,956

4. Credit Cards 1,69,536 2,28,203 2,59,561 34.6 13.7 41,361 57,984 65,356

5. Debit Cards 60,177 88,306 1,27,654 46.7 44.6 8,172 12,521 18,547

Total 3,78,710 5,35,309 6,67,825 41.4 24.8 2,35,693 10,41,990 5,00,322