Sanghvi Innovative Academy

Definition of Bank
Financial institutions that conduct current
accounts for customers and enable customers
to pay and be paid by third parties.
 The Banking Sector in India
 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.

 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.
 WHO CONTROLS OVER BANKS?
The Reserve Bank of India (RBI)
History :-
Become operational on April 1,1935
Nationalized in the Year 1949.
Major objectives:-
Regulate the issue of banknote.
Maintain reserves with a view to securing
monetary stability.
To operate the credit and currency system of the
country to its advantage
Functions of RBI
 Traditional functions
Monopoly of currency notes issue
Banker to the Government
Fight against economic crisis and ensures stability
of Indian economy.
Maintaining the external value of domestic
currency
 Promotional functions
Extension of the facilities for the small scale industries
Innovating the new banking business transactions.
Extension of the facilities for the provision
of the agricultural credit through NABARD
(NATIONAL BANK FOR AGRICULTURE AND RURAL
DEVELOPMENT)
 Supervisory function
Granting license to Banks.
Periodical review of the work of the commercial banks
Control the non-banking finance corporation.
 Past Trends
The banking industry in India seems to be unaffected from
the global financial crises which started from U.S in the last
quarter of 2008. Despite the fallout and nationalization of
banks across developed economies, banks in India seems to
be on the strong fundamental base and seems to be well
insulated from the financial turbulence emerging from the
western economies.
The Indian banking industry is well placed as compare to
their banking industries western counterparts which are
depending upon government bailout and stimulus
packages.
 Key Banking Sector Analysis
The new market research report by RNCOS, provides
extensive research and rational analysis on the Turkish
banking industry. This report has been made to help clients
in analyzing the opportunities, challenges and drivers
critical to the growth of banking industry in Turkey.

 It gives a brief account of the Political, Economic, Social

and Technological environment of the country with respect
to its banking industry to better evaluate the forces
influencing the industry.
 Forecasting of Banking Sector
 The report “Indian Banking Sector Forecast to 2012” contains comprehensive
research and rational analysis on various segments, like assets size, income
level and number of cardholders, in the Indian banking industry.

 The forecast given in this report is not based on a complex economic model but
is intended as a rough guide to the direction in which the market is likely to
move. The future projection is done on the basis of the current market
scenario, past trends, and rules and regulations laid by the regulator and
supervisor of the financial system, Reserve Bank of India (RBI).

 Industry Forecast till 2011-12

- Banking Industry Assets in Rs Crore
- Banking Industry Income in Rs Crore
- Banking Industry Deposits in Rs Crore
- Banking Industry Loans and Advances in Rs Crore
- Number of Credit Cards in Million
- Number of Debit Cards in Million
 Analysis Method
The analysis methods include ratio analysis, historical
trend analysis, linear regression analysis using
software tools, judgmental forecasting, and cause and
effect analysis.