Professional Documents
Culture Documents
Banking
Banking
Group ‘7’
Agenda
01 INTRODUCTION
02 HISTORY
03 MARKET SIZE
04 TYPES
05 KEY RATES
Banking - INTRODUCTION
The banking sector is the lifeline of any modern economy. It is one of the important fina
ncial pillars of the financial sector
They play an important role in the mobilization of deposits and disbursement of credit to
various sectors of the economy
The strength of an economy depends on the strength and efficiency of the financial syste
m, which in turn depends on a sound and solvent banking system
The current global crisis that hit every country raised various issue regarding efficiency a
nd solvency of banking system in front of policy makers
Banking - HISTORY
The Banking system in India can be categorized in two phases
Three presidency banks Bank of Bengal, Bank of Bombay and Bank of Madra
s established in the 19th Century under the charter of the British East India C
ompany.
Six more banks further nationalized in the year 1980. With the second wave of
nationalization, the target of priority sector lending was also raised to 40%.
Kotak Mahindra Bank and Yes Bank got a license from RBI to entry in the system
in the year 2003 and 2004.
In 2014, RBI grants in-principle approval to IDFC and Bandhan Financial Services
to set up banks.
Section Break
Banking - Market Size
The Indian banking system consists of
27 public sector banks
21 private sector banks
49 foreign banks
56 regional rural banks
1,562 urban cooperative banks
94,384 rural cooperative banks
In FY07-18, total lending increased at a CAGR of 10.94 per cent
Total deposits increased at a CAGR of 11.66 per cent.
India’s retail credit market increased to US$ 281 billion on December
2017 from US$ 181 billion on December 2014.
Banking - GDP Contribution
The Indian Banking industry is currently worth Rs. 81 trillion (US $ 1
.31 trillion)
Industrial Banks
Agricultural Banks
Banking - Types
Payments Bank
A payments bank is like any other bank which carry most banking operation
s on a small scale without involving any credit risk.
CRR, SLR & Repo Rate Reverse Repo
Rate
CRR (cash reserve SLR (statutory liquidity
ratio) ratio)
Under CRR a certain percen SLR, statutory liquidity ratio is th
tage of the total bank deposi e amount of money that is invest
ts has to be kept in the curre ed in certain specified securities
nt account with RBI predominantly central governme
which means banks do not h nt and state government securiti
ave access to that much am es.
ount for any economic activit The current rates are (as of June
y or commercial activity 2018) 19.5%
The current rates are (as of
June 2018) CRR is 4 %
Repo Rate Reverse Repo Rate
The term ‘Repo’ stands for ‘Re Reverse Repo rate is the rate at wh
purchase agreement’. It is the r ich Reserve Bank of India borrows f
ate at which Reserve Bank of In unds from all the other commercial
dia lends money to all the com banks in the country. Current revers
mercial banks in the country in t e repo rate is calculated at 6%.
he event of scarcity of funds.
Current repo rate is 6.25%.
Thank you