Industrial finance in india new


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Industrial finance in india new

  1. 1. Industrial Finance In IndiaRole Of Financial Institutions & Commercial Bank
  2. 2. SynopsisIntroductionThe regulatory bodies of the financial institution Industrial financeList of finance institutionTypes Of Financial InstituteRole of finance institutionImpact of finance institution
  3. 3. What Is A Financial Institute Financial Economics Financial Institution An Institution Financial Services Financial Intermediaries. Regulated By The Government
  4. 4. Definition Of Financial Institute A Bank Or Other Financial Institution That Serves As A Facilitator Between Two Parties To A Financial Arrangement. Execution Of Loans, Property Sales, Business Contracts, Or Other Agreements Often Require AFinancial Intermediary To Guarantee Payment ToOne Party, Or To Provide Access Of Funding For Completion Of The Agreement.
  5. 5. The Regulatory Bodies Of TheFinancial Institutions In India  Reserve Bank of India (RBI)  Securities and Exchange Board of India (SEBI)  Central Board of Direct Taxes (CBDT)  Central Board of Excise & Customs
  6. 6. List of AIFI’s Industrial Development Bank Of India (IDBI) Industrial Finance Corporation Of India (IFCI) Export - Import Bank Of India (Exim Bank) Industrial Reconstruction Bank Of India (IRBI) Now (Industrial Investment Bank Of India) National Bank For Agriculture And Rural Development (NABARD) Small Industries Development Bank Of India (SIDBI) National Housing Bank (NHB)
  7. 7. Continued… Unit Trust of India (UTI) Life Insurance Corporation of India (LIC) General Insurance Corporation of India (GIC) Risk Capital and Technology Finance Corporation Limited. (RCTC) Technology Development and Information Company of India Ltd.(TDICI) Tourism Finance Corporation of India Ltd. (TFCI) Shipping Credit and Investment Company of India Ltd. (SCICI) Discount and Finance House of India Ltd. (DFHI)
  8. 8. Organizations Of The Mutual Funds Companies In IndiaThe Mutual Funds In India Has 5Constituents The Board Of Trustees Or The Trust The Sponsors The Asset Management Company The Custodian The Unit Holders
  9. 9. Types Of Financial Institute Depositary Institutions Contractual Institutions Investment Institutions
  10. 10. Role Of Specialized Financial Institution SFIs Are Institution Set Up Mainly By The Government For Providing Medium And Long Term Financial Assistances To Industry As These Institutions Provide Developmental Finance, That Is Finance For Investment In Fixed Assets They Are Also Known As Development Bank Or Development Financial Institution These Institution Receive Funds For Their Financing Operations Primarily From The Government Or Other Public Institutions These Institution Also Raise Funds From The Capital Market
  11. 11. The Impact Of Financial Institutions And Financial Markets On The Real EconomyThe Critical Role of Financial IntermediationFinancial Turmoil and LiquidityNew Credit Facilities
  12. 12. Industrial Of Employment For Financial Manager [CATEGORYOthers BANKING NAME] 4% NON-BANK PDs [PERCENTA insurance companies GE]Provident mutual funds BANKING financial institution Funds 47% financial FIIs mutualcorporates corporates 7% institution 1% funds 2% FIIs 0% insurance Provident Funds NON-BANK RBI companies PDs Others 21% 0%
  13. 13. Industries of employment for Architects Construction 4% Self Employed 22% Construction Architectural &Government 3% Engineering services Government Self Employed Architectural & Engineering services 71%
  14. 14. Industries of Employment for Food Scientists 12%, 22% 20%, 37% 7%, 13% 15%, 28% Manufacturing Educational Institutions Federal Government Self Employed
  15. 15. Consulting 7% Operations17% 32% Banking & Finance Marketing & Sales12% IT & IT Service 14% 18% Others
  16. 16. Industries of Employment for Financial Managers Government 12% 15% Retail & Wholesale Self Employed20% 15% Healthcare Educational Service 8% Admin & Support 15% 5% Company & enterprises 10% Management
  17. 17. Commercial bank Nature of commercial bank Facts about bank formation List of commercial banks in India Functions of commercial bank Role’s of commercial bank Role of commercial bank in 21st century Risk In Commercial Bank Virtual banking Conclusion
  18. 18. Nature Of Commercial BankCommercial banks play an important and active role in the economic development of a country.If the banking system in a country is effective, efficient and disciplined it brings about a rapid growth in the various sectors of the economy.The following is the significance of commercial banks in the economic development of a country.
  19. 19. Facts About Bank FormationEligible promotersCorporate structureMinimum capital requirementForeign shareholdingCorporate governanceBusiness modelOther conditions
  20. 20. RESERVE BANK OF INDIA CENTRAL BANK AND SUPREME MONETARY AUTHORITY SCHEDULED BANKS COMMERCIAL BANKS CO-OPERATIONSForeign Regional Urban State Banks Rural Cooperatives Cooperatives (40) Banks(196) (52) (16)Public Sector Banks Private Sectors Banks (27) (30) OLD New (22) (8) State Bank Of India Other Nationalised And Associate Banks Banks (8) (19)%
  21. 21. Function of commercial bank1. Accepting deposits2. Giving loans3. Overdraft4. Discounting of Bills of Exchange5. Investment of Funds6. Agency Functions7. Miscellaneous Functions
  22. 22. Role of Commercial Banks in the Economic Development of a Country1. Banks promote capital formation2. Investment in new enterprises3. Promotion of trade and industry4. Development of agriculture5. Balanced development of different regions6. Influencing economy activity7. Implementation of Monetary policy8. Monetization of the economy9. Export promotion cells
  23. 23. Role of Commercial Banks in the Economic Development of a Country1. Banks promote capital formation: Commercial banks accept deposits fromindividuals and businesses, these deposits are then made available to the businesses which make use of them for productive purposes in the country. The banks are, therefore, not only the store houses of the country’s wealth, but also provide financial resources necessary for economic development.
  24. 24. Role of Commercial Banks in the Economic Development of a Country 2. Investment in new enterprises:Businessmen normally hesitate to invest their money in risky enterprises. The commercial banks generally provide short and medium term loans to entrepreneurs to invest in new enterprises and adopt new methods of production. The provision of timely credit increases the productive capacity of the economy.
  25. 25. Role of Commercial Banks in the Economic Development of a Country 3. Promotion of trade and industry:With the growth of commercial banking, there is vast expansion in trade and industry. The use of bank draft, check, bill ofexchange, credit cards and letters of credit etc. has revolutionized both national and international trade.
  26. 26. Role of Commercial Banks in the Economic Development of a Country 4. Development of agriculture: The commercial banks particularly indeveloping countries are now providing creditfor development of agriculture and small scale industries in rural areas. The provision of credit to agriculture sector has greatly helped in raising agriculture productivity and income of the farmers.
  27. 27. Role of Commercial Banks in the Economic Development of a Country 5. Balanced development of different regions: The commercial banks play an important role in achieving balanced development in different regions of the country. They help in transferring surplus capital fromdeveloped regions to the less developed regions. The traders, industrialist etc. of less developed regions are able to get adequate capital for meeting their business needs. This in turn increases investment, trade and production in the economy.
  28. 28. Role of Commercial Banks in the Economic Development of a Country 6. Influencing economic activity:The banks can also influence the economic activity of the country through its influence on a. Availability of credit b. The rate of interest If the commercial banks are able to increase theamount of money in circulation through credit creation or by lowering the rate of interest, it directly affects economic development. A low rate of interest can encourage investment. The credit creation activity can raise aggregate demand which leads to more production in the economy.
  29. 29. Role of Commercial Banks in the Economic Development of a Country 7. Implementation of Monetary policy:The central bank of the country controls and regulatesvolume of credit through the active cooperation of the banking system in the country. It helps in bringing price stability and promoteseconomic growth with in the shortest possible period of time.
  30. 30. Role of Commercial Banks in the Economic Development of a Country 8. Monetization of the economy:The commercial banks by opening branches inthe rural and backward areas are reducing the exchange of goods through barter. The use of money has greatly increased the volume of production of goods.The non monetized sector (barter economy) is now being converted into monetized sector with the help of commercial banks.
  31. 31. Role of Commercial Banks in the Economic Development of a Country 9. Export promotion cells:In order to increase the exports of the country, the commercial banks have established export promotion cells.They provide information about general trade and economic conditions both inside and outside the country to its customers. The banks are therefore, making positive contribution in the process of economic development.
  32. 32. Role of Banks in 21st century  The commercial banks are now not confined to local banking.  They are fast changing into global banking, understanding the global customer, using latest information technology, competing in the open market with high technology system, changing from domestic banking to investment banking etc. The commercial bank are now considered the nerve system of all economic development in the country.
  34. 34. Risk In Commercial BankTypes Of Risk Interest Sensitive Assets Credit Risk Interest Rate Risk Liquidity Risk Operational Risk Monitoring Risk Foreign Ex-change Risk Derivatives Treasury Function
  35. 35. RBI Guidelines For Risk ManagementCredit RiskLiquidity RiskInterest Rate RiskMarket RiskOperational Risk
  36. 36. Virtual BankingWhat is virtual banking?Providing the banking services through extensive use of information technology without direct recourse to the bank by the customer is called virtual banking.The origin of virtual banking can be traced to the 1970,s with the installation of ATM’s.The principal types of virtual banking services include automated teller machines (ATM’s), phone banking and most recently internet banking.With the increasing use of internet banking there is greater reliance now on information technology and the decrease of physical bank branches to deliver the banking services to the customer.
  37. 37. CONCLUSION Banks were the earliest credit institutions extendingloans(credit) to customers. It was their job to transform short-term liquid deposits in to long-term illiquid financial assets that can fund longgestation activities and enhance economic growth.