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ROJECT

EPORT

OST

UTTING

& P

ROFIT

AXIMIZATION

ANKS

RESENTED

OOJA

OTHRA

OLL

:CBS/CHE/ BFSM/08-09/009

ABLE

ONTENT

…

Introduction……………………………………………………3Relevance of Cost Cutting & Profit Maximization in Banks....5Detailed Analysis……………………………………………..7Cost Cutting Strategies………………………………………..8Profit Maximization Strategies……..…………………………13Ratios………………………………………………………….18Findings & Suggestions............……………….………………23Conclusion…………………………………………………….25Bibliography………………………………………………….26

INTRODUCTION

The Industrialization of Financial Services, Banking used to be a relatively simple business, only slightly more complex than the old industry joke that claimed the businessoperated on a 3-9-3 rule: take deposits at 3 percent, lend them at 9, and get to the golf 2

course by three o'clock. But those days are long gone. To capture a larger share of themarket, most leading banks have extended their product portfolios, and many of thelargest banks have diversified into new lines of business that range from financial adviceall the way to insurance. At the same time, they have looked overseas and across borderstoward new markets and sought greater scale through acquisitions.

VARIOUS PHASES OF INDIAN BANKING SECTOR Phase I

General Bank of India was set up in the year 1786India Company established Bank of Bengal (1809)Bank of Bombay (1840) and Bank of Madras (1843) were established asindependent units and called were called Presidency Banks.Reserve Bank of India in the year 1935The Banking Company Act, 1949People as a convention had most of their savings in Post Offices

Phase II

Nationalization of imperial bank of India and formation of sate bank of India(1955) Nationalization of SBI and Subsidiaries(1960)Insurance cover extended to depositsCreation of credit guarantee corporationCreation of regional rural banks

Phase III

This phase had introduced many more products and facilities in the banking sector in itsreforms measure. In 1991, under the chairmanship of M Narasimham, a committee wasset up by his name which worked for the liberalisation of banking practices.3