BUSINESS ENVIRONMENT

BANKING AND CAPITAL MARKET IN INDIA F.Y.BMS PRASHANT GUPTA-19

SUMIT SHUKLA-55

the first bank established in India. then the nationalization of banks in 1969 and recently the liberalization of the same since 1991 .Banking in India Introduction: Banking dates back to 1786.

Banks in India Banking services in India Financial and banking sector reforms Reserve bank of India Easy banking Banking services for NRIs Indian bank association (IBA) Proxy banks in India .

In terms ownership and function. . completion has increase in banking sector. commercial bank can be classified into 3 groups: Public sector banks regional rural banks and private banks (both domestic and foreign) These banks have a very large number of branches spread across the country. After the financial sector reforms.Development of banks in India: Banks in India can be classified as commercial banks and Co-operative banks.

Every bank which expects to succeed must first of all prove its value to the community.The Functions of Banking The most important functions of banking may be classified as follows:  to assemble capital and make it effective  to receive deposits and make collections  to check out and transfer funds  to discount or lend  to exercise fiduciary or trust powers  to issue circulating notes. .

providing services to midmarket business corporate banking. dealing directly with individuals and small businesses business banking. relating to activities on the financial markets. directed at large business entities private banking. . investment banking.Types of banks Bank activity can be divided into following types: retail banking. providing wealth management services to high net worth individuals and families.

One way that the companies or the government raise these long term funds is through issuing bonds.What is capital market? Basically the capital market is a type of financial market. the higher return is paid through interest that accrues on the money that the government or company borrows. which is where a person buys the bond for a set price and allows the government or company to borrow their money for a certain time period but they are promised a higher return for allowing them to borrow the money. But in general the capital market is the market for securities where either companies or the government can raise long term funds. it includes the stocks and bonds market as well. .

Capital Market       Legislations  Capital Issues (Control) Act. Custodial Services Intermediaries Underwriter. Broker. 1992  Securities Contract (Regulation) Act. Merchant Banking. 1996  Companies Act.1956  Depositories Act.1947  SEBI Act. RBI and SEBI Instruments  Traditional  Modern-Derivatives. Registrar. Euro Issues etc. Exchange Traded Funds. DCA. Services  Underwriting. 1956 Regulators  DEA. Advisors etc. Banker. .

National Stock Exchange (NSE) NSE was recognized as a stock exchange in April 1993 under the Securities Contracts (Regulation) Act. whereas the derivative segment started in 2000. . It commenced its operations in Wholesale Debt Market in June 1994. The capital market segment commenced its operations in November 1994.

Structure of capital market in India: .

Securities and Exchange Commission is in charge of regulating the capital market. used during the Renaissance by Jewish Florentine bankers. who used to make their transactions above a desk covered by a green tablecloth However. and the secondary market where existing securities are traded. Both of these markets are regulated so that fraud does not occur and in the United States the U. there are traces of banking activity even in ancient times.S. The first market is the primary market and it is where new issues are distributed to investors.Conclusion The name bank derives from the Italian word banco "desk/bench". . The capital market actually consists of two markets.

2010 .26th Feb.

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