Corparare finane exim bank


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Corparare finane exim bank

  1. 1. ASSIGNMENT<br />ON<br />FUNCTIONS AND ROLES OF EXIM AND COMMERCIAL BANK<br />PREPARED BY<br />JABIR PK <br />REGNO: 1015951<br />EXIM BANK OF INDIA<br />set up by an act of parliament in september 1981<br />wholly owned by government of india<br />commenced operations in march 1982<br />apex financial institution<br />OBJECTIVES:<br />“… for providing financial assistance to exporters and importers, and for functioning as the principal financial institution for coordinating the working of institutions engaged in financing export and import of goods and services with a view to promoting the country’s international trade…” <br />Financing Programmes<br />Financing Programmes (Various Currencies)Import CreditLoans for Exporting UnitsMedium / Long TermLines of CreditBuyer’s CreditSupplier’s CreditShort TermPre/Post Shipment CreditImport Loan for capital goodsBulk Import Loan for Raw MaterialsTerm Loans for expansion/ diversification/ new projects/ export product development/ export marketing/ research & developmentTerm Loans for overseas equity investmentDirect equity stake in Indian/ Overseas ventures of exporting companies<br />EXPORT MARKETING FINANCE<br />administered an export marketing fund from world bank <br />smes extended export marketing finance to implement strategic export marketing plans aimed at entry into developed country markets and term loans for supply side upgradation <br />exim bank’s assistance resulted in generation of significant exports to developed country markets<br />many of these companies have become large companies with high export orientation<br />based on the successes achieved in the programme implemented by exim bank in india, the bank has shared its experience with other developing countries, with world bank funding<br />over 300 companies supported in variety sectors:<br />LINES OF CREDIT <br />Exim Bank’s extends export Lines of Credit (LOC) to overseas financial institutions, regional development banks and foreign governments and their agencies and Buyers’ Credits (BC) to foreign corporates <br />LOCs also extended at the behest of Government of India <br />LOCs serve as a market entry mechanism to Indian exporters and provide a safe mode of non-recourse financing option to Indian exporters<br />LOCs/BCs are particularly relevant for Indian SME exporters as the payment risk is borne by Exim Bank<br />Bank has in place 117 operative LOCs covering more than 94 countries of value of over US$ 3.85 billion<br />ENTERPRISE MANAGEMENT DEVELOPMENT SERVICES<br />Competency as Collateral :<br />Development of Loan.Com an IT tool kit which will enable SMEs to develop bankable business plans thereby enhancing their access to finance<br />Tool kit will also enable lending institutions to screen viable projects<br />Pioneering initiative for supporting SMEs and for providing term loans and export finance facilities to identified units to help them in their globalisation efforts.<br />Learning from the programme to be transferred to other developing countries; capacity creation and institution building in the global arena. <br />Exim Bank has already financed select firms by way of term loans and export finance facilities, using the tool kit<br />Global Trade Finance under IFC<br />Agreement between Exim Bank and International Finance Corporation (IFC)<br />Envisages confirmation of Letters of Credit (L/Cs), Standby letters of Credit, demand guarantees, promissory notes or bills of exchange received by Indian exporters<br />From 105 pre-approved banks in more than fifty countries of IFC’s operation<br />Covers the risk of non-payment by Issuing Bank to Negotiating / Paying banks<br />Export Marketing Services<br />Exim Bank has launched an ‘Export Marketing Services’ programme <br /><ul><li>Seeks to help Indian SME sector to establish their products overseas and enter new markets through Exim’s overseas offices and institutional partner network</li></ul>Helps Indian SMEs in their export efforts by proactively assisting in locating overseas buyers/partners for their products/services<br />No upfront fees, but operates on success-fee basis<br />Some of the sectors assisted include : <br />EXIM BANK: PARTNER IN GLOBALISATION<br />TechnologyCapital (Foreign Investment)Raw MaterialsCapital GoodsFinal ProductsCapital GoodsCapital(Overseas Ventures)Product DevelopmentProductionMarketingPre shipmentPost shipmentVALUEADDITIONEXPORTMITROP<br />COMMERCIAL BANKS IN INDIA<br />Evolution &Management<br />The history of banking dates back to the 13th Century when the first bill of exchange was used as money in the medieval trade.<br />In 1683, the first bank was set up in Madras by the officers of the East India Company.<br />Between 1770 and 1850, agency houses established the Bank of Hindustan, the Commercial Bank, the Bank of Calcutta and the Bank of Bombay. <br />Later, The Commercial and the Calcutta Bank merged to form the Union Bank.<br />Three Presidency Banks-the Bank of Bombay, the Bank of Madras, and the Bank of Bengal, which were set up between 1809 and 1843, were amalgamated into the Imperial Bank of India in 1921.<br />The Imperial Bank of India eventually became the State Bank of India.<br />The Principle of limited Liability was a landmark in Indian Banking <br />The sudden boom of investment in 1900.s led to the emergence of Joint Stock Banks such as Punjab National Bank (1895), the Bank of India (1906), the India Bank (1907), the Bank of Baroda (1909), Central Bank of India (1911), and the Union Bank of India (1919).<br />The major functions of these banks was to finance foreign trade, while domestic trade was largely handled by moneylenders<br />Between 1941 and 1945, the number of banks rapidly increase from 473 to 737, but these banks suffered from certain limitations such as inadequate capital structure and unsound methods of operations and management.<br />To overcome these limitations, the Government of India, in consultation with RBI, enacted the Banking Companies Act in 1949. <br />Through elimination and mergers, the number of banking institutes was reduced considerably. Between 1947 and 1969, Banks were under the private ownership of Maharaja, or kings, of the Princely states of India.<br />These banks used to serve rich families and industrial houses and this narrowed the growth of the banking system.<br />The RBI accelerated the task of consolidation in 1960, when the scope of Banking Companies Act was widened.<br />This resulted in decline in the number of banks from 548 in 1947 to 89 in 1969Between 1969 and 1992, there was a rapid expansion of branch network.<br />The number of bank branches increased from 8262 to 60570, deposits rose from Rs 4646 Crores to Rs 2,37, 566 crores, advances from Rs 3599 Crores to Rs 131520 crores in 1991, reflecting a rapid growth of banking activity.<br />The banking system spread to rural areas, small-scale, tiny and cottage industries, and the small entrepreneurs benefitting from the spread of the bankning system. <br />