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INDIAN FINANCIAL SYSTEM
1. Indian Financial Systems
Finance is defined in numerous ways by different groups of people. Though it is
difficult to give a perfect definition of Finance following selected statements will help
you deduce its broad meaning.
“Finance is the management of money and other valuables, which can be easily
converted into cash.”
“Finance is a simple task of providing the necessary funds (money) required by the
business of entities like companies, firms, individuals and others on the terms that
are most favorable to achieve their economic objectives.”
2. FINANCIAL SERVICES
As per section 65(10) of the Finance Act, 1994, “banking and financial services”
means the following services provided by a banking company or a financial institution
including a non banking financial company, namely;
(i) FINANCIAL LEASING SERVICES INCLUDING EQUIPMENT LEASING AND HIRE-PURCHASE BY A
BODY CORPORATE;
(ii) CREDIT CARD SERVICES;
(iii) MERCHANT BANKING SERVICES;
(iv) SECURITIES AND FOREIGN EXCHANGE (FOREX) BROKING;
(v) ASSET MANAGEMENT INCLUDING PORTFOLIO MANAGEMENT, ALL FORMS OF FUND
MANAGEMENT, PENSION FUND MANAGEMENT, CUSTODIAL DEPOSITORYAND TRUST
SERVICES, BUT DOES NOT INCLUDE CASH MANAGEMENT;
(vi) ADVISORY AND OTHER AUXILIARY FINANCIAL SERVICES INCLUDING INVESTMENT
AND PORTFOLIO RESEARCH AND ADVICE, ADVICE ON MERGERS AND ACQUISITION AND
ADVICE ON CORPORATE RESTRUCTURING AND STRATEGY; AND
vii) PROVISION AND TRANSFER OF INFORMATION AND DATA PROCESSING.
6. Call and Notice Money Market: This market functions only for an
extremely short period. Here, funds are transacted on an overnight
basis. The participants are mostly banks. Therefore, it is also called
the Inter-Bank Money Market. In the notice money market, funds are
transacted for 2 days and a 14-day period.
CALL MONEY MARKET
7. TREASURY BILL MARKET (T-BILLS)
This market deals in Treasury Bills of a short-term duration issued by
the RBI on behalf of the Government of India. At present, three types
of treasury bills are issued through auctions, namely, 91-day, 182-day
and 364-day treasury bills.
8. CERTIFICATE OF DEPOSITS (CDS)
These are issued by Commercial banks and development financial
institutions for funds deposited. CDs are unsecured, negotiable promissory
notes issued at a discount to the face value. The scheme pertaining to CDs
was introduced in 1989 by the RBI, to mainly enable commercial banks to
raise funds from the market. At present, the maturity period of CDs ranges
from 3 months to 1 year. They are issued in multiples of INR 25 lakhs subject
to a minimum of INR 1 crore.
9. COMMERCIAL PAPERS (CPS)
Commercial Papers are unsecured money market instruments issued in the
form of promissory notes or in demat form. These were introduced in
January 1990. Commercial Papers can be issued by a listed company that
has a working capital of not less than INR 5 crores. They could be issued in
multiples of INR 25 lakhs. The minimum size of issue is INR 1 crore. At
present, the maturity period of CPs ranges between 7 days and 1 year. CPs
are issued at a discount to its face value and redeemed at its face value.
10. Financial
Institutions
Banking
Institutions
Public sector banks
Private sector
banks
Foreign banks
Regional rural
banks
Non-banking
Institutions
Tourism Finance
Corporation of
India Ltd. (TFCI):
General Insurance
Corporation (GIC):
Export-Import
Bank of India
(EXIM)
National Bank for
Agriculture and
Rural Development
(NABARD)
National Housing
Bank (NHB):
11. Tourism Finance Corporation of India Ltd. (TFCI)
The GoI had, pursuant to the recommendations of the National Committee on
Tourism (i.e. the Yunus Committee set up under the aegis of Planning Commission),
decided in 1988, to promote a separate All-India Financial Institution for providing
financial assistance to tourism-related activities/ projects.
12. General Insurance Corporation (GIC)
The entire general insurance business in India was nationalized by
General Insurance Business (Nationalization) Act, 1972 (GIBNA). The General
Insurance Corporation of India (GIC) was formed in pursuance of Section 9(1) of
GIBNA. It was incorporated on 22 November 1972 under the Companies Act,
1956, as a private company limited by shares. GIC was formed for the purpose of
superintending, controlling and carrying on the business of general insurance. It
has a number of need-based insurance schemes to meet the diverse and emerging
needs of various segments of society.
13. Export-Import Bank of India (EXIM)
Export-Import Bank of India is the premier export finance institution of the
country, set up in 1982 under the Export–Import Bank of India Act, 1981. The
Government of India launched the institution with a mandate, not only to enhance
exports from India but also to integrate the country’s foreign trade and investment
with the overall economic growth. For financing overseas investments, EXIM has
put in place a Technology and Innovation Enhancement and Infrastructure
Development (TIEID) for MSMEs by partnering with Banks/FIs.
14. National Bank for Agriculture and Rural Development (NABARD)
This is the apex institution in the country and it looks after the development of the
cottage industry, small industry and village industry, and other rural industries.
NABARD also reaches out to allied economies and supports and promotes
integrated development. Against the backdrop of the massive credit needs of rural
development and the need to uplift the weaker sections in rural areas, the National
Bank for Agriculture and Rural Development was set up in 1982 under the
National Bank for Agriculture and Rural Development Act 1981.
15. National Housing Bank (NHB)
This was set up on 9 July 1988 under the National Housing Bank Act,
1987. It is wholly owned by the Reserve Bank of India, which contributed
the entire paid-up capital. The Head Office of the NHB is in New Delhi.
The NHB has been established to promote a sound, healthy, viable and
cost-effective housing finance system to cater to all segments of the
population and to integrate the housing finance system with the overall
financial system.
16. Industrial Finance Corporation of India (IFCI)
Government of India set up the Industrial Finance Corporation
of India (IFCI) in July 1948 under a special Act. This is the first
financial institution set up in India with the main object of making
medium and long term credit to industrial needs.
17. The corporation grants loans and advances to industrial concerns.
Granting of loans both in rupees and foreign currencies.
The corporation underwrites the issue of stocks, bonds, shares etc.
The corporation can grant loans only to public limited companies and
co-operatives but not to private limited companies or partnership firms.
Entrepreneur Development
Industrial Development in Backward Areas
The functions of the IFCI
18. Industrial Development Bank of India (IDBI) established under Industrial
Development Bank of India Act, 1964, is the principal financial institution for providing
credit and other facilities for developing industries and assisting development institutions.
Till 1976, IDBI was a subsidiary bank of RBI. In 1976 it was separated from RBI and the
ownership was transferred to Government of India. IDBI is the tenth largest bank in the
world in terms of development. The National Stock Exchange (NSE), the National
Securities Depository Services Ltd. (NSDL), Stock Holding Corporation of India (SHCIL)
are some of the Institutions which has been built by IDBI.
Industrial Development Bank of India (IDBI)
19. Functions of IDBI
Provide financial assistance to industrial
enterprises
Technical and
administrative
assistance for
promotion
management
Expansion of industry
Promote
institutions
engaged in
industrial
development
Undertake market and
investment research
and surveys in
connection with
development of
industry.
20. India’s State Finance Corporations SFCs
The State Finance Corporations (SFCs) are the
integral part of institutional finance structure in the country.
SFC promotes small and medium industries of the states.
Besides, SFCs are helpful in ensuring balanced regional
development, higher investment, more employment generation
and broad ownership of industries.
21. Functions
The SFCs grant loans mainly for acquisition of fixed assets like land,
building, plant and machinery.
The SFCs provide financial assistance to industrial units whose paid-up
capital and reserves do not exceed Rs. 3 crore (or such higher limit up to
Rs. 30 crore as may be specified by the central government).
The SFCs underwrite new stocks, shares, debentures etc., of industrial
concerns.
The SFCs provide guarantee loans raised in the capital market by
scheduled banks, industrial concerns, and state co-operative banks to be
repayable within 20 years.
22. 1. Andhra Pradesh State Financial Corporation
(APSFC)
2. Himachal Pradesh Financial Corporation (HPFC)
3. Madhya Pradesh Financial Corporation (MPFC)
4. North Eastern Development Finance Corporation
(NEDFI)
5. Rajasthan Finance Corporation (RFC)
6. Tamil Nadu Industrial Investment Corporation
Limited
7. Uttar Pradesh Financial Corporation (UPFC)
8. Delhi Financial Corporation (DFC)
9. Gujarat State Financial Corporation (GSFC)
10. The Economic Development Corporation of Goa
(EDC)
11. Haryana Financial Corporation (HFC)
12. Jammu & Kashmir State Financial Corporation
(JKSFC)
13. Karnataka State Financial Corporation (KSFC)
14. Kerala Financial Corporation (KFC)
15. Maharashtra State Financial Corporation (MSFC)
16. Odisha State Financial Corporation (OSFC)
17. Punjab Financial Corporation (PFC)
18. West Bengal Financial Corporation (WBFC)
List of state financial corporation
23. Industrial Credit and Investment
Corporation of India (ICICI)
The IFCI and SFCs confined themselves to lending activity and kept
away from underwriting and investing in business though they were
authorized to subscribe for the shares and debentures of the companies and
to undertake underwriting business. Therefore, a large number of up and
coming enterprises faced continuous problems in raising funds in the capital
market.
Besides, they were not in a position to secure the desired amount of
loan assistance from the financial institutions due to their thin equity base. To
encourage industrial development in the private sector, a considerable
provision of underwriting facility was considered necessary to accelerate the
phase of the industrialization.
24. To assist in creation, growth and modernization of business enterprises in the
non-public sector.
To encourage and promote the involvement of internal and external capital
sources, in such enterprises.
To motivate pvt ownership of industrial investment and to promote and assist
in the expansion of markets.
To provide equipment finance.
To provide finance for rehabilitation of industrial units.
Objectives of the ICICI
25. Providing finance in the form of long-term or medium term loans or equity
participation.
Sponsoring and underwriting new issues of shares and other securities,
Guaranteeing loans from other private investment sources.
Making funds available for reinvestment by revolving investment as
rapidly as possible.
Functions of the ICICI
26. Export-Import Bank of India
The Export-Import Bank of India, commonly known as the EXIM bank,
was set up on January 1, 1982 to take over the operations of the international
finance wing of the IDBI and to provide financial assistance to exporters and
importers to promote India’s foreign trade. It also provides refinance facilities to
the commercial banks and financial institutions against their export-import
financing activities.
27. Financing of export and import of goods and services both of India and of outside
India.
Providing finance for joint ventures in foreign countries.
Undertaking merchant banking functions of companies engaged in foreign trade.
Providing technical and administrative assistance to the parties engaged in export
and import business.
Offering buyers’credit and lines of credit to the foreign governments and banks.
Providing advance information and business advisory services to Indian exports in
respect of multilaterally funded projects overseas.
Production Equipment Finance Programme
Export Marketing Finance
Export Vendor Development Finance
Functions of the EXIM
28. The National Small Industries Corporation Ltd. (NSIC), an ISO 9000 certified
company, since its establishment in 1955, has been working to fulfill its mission of promoting,
aiding and fostering the growth of small-scale industries and industry related small-scale
services/businesses in the country.
Over a period of six decades of transition, growth and development, the NSIC has
proved its strength within the country and abroad by promoting modernization, up gradation
of technology, quality consciousness, strengthening linkages with large and medium
enterprises and enhancing export projects and products from small-scale enterprises.
At present, the NSIC operates through 6 Zonal Offices, 26 Branch Offices, 15 Sub-
offices, 5 Technical Services Centres, 3 Extension Centres and 2 Software Technology Parks
supported by a team of over 5000 professionals spread across the country. To mange
operations in Gulf and African countries, the NSIC operates from its offices in Dubai and
Johannesburg.
National Small Industries Corporation Ltd
29. Provide machinery on hire-purchase scheme to small-scale industries.
Provide equipment leasing facility.
Help in export marketing of the products of small-scale industries.
Participate in bulk purchase Programme of the Government.
Develop prototype of machines and equipment's to pass on to small-scale industries for
commercial production.
Distribute basic raw material among small-scale industries through raw material depots.
Help in development and up-gradation of technology and implementation of modernization
programmes of small-scale industries.
Impart training in various industrial trades.
Set up small-scale industries in other developing countries on turn-key basis.
Undertake the construction of industrial estates.
Its main functions
30. The Life Insurance Corporation of India (LIC) came into existence on July
1, 1956 and the LIC began to function on September 1, 1956. The LIC gets a large
amount of insurance premium and has been investing in almost all sectors of the
economy, viz, public sector, private sector, co-operative sector, Joint Sector and now
it is one of the biggest term-lending institutions in the country. LIC was established
to spread the message of Life Insurance in the country and mobilize people’s
savings for nation-building activities.
The Life Insurance Corporation of India (LIC)
31. To mobilize maximum savings of the people by making insured savings more
attractive.
To extend the sphere of life insurance and to cover every person eligible for
insurance under insurance umbrella.
To act as trustees of the insured public in their individual and collective
capacities.
Promote all employees and agents of the LIC, in the sense of participation
and job satisfaction through discharge of their duties with dedication
towards achievement of LIC objectives.
To ensure economic use of resources collected from policy holders.
To conduct business with utmost economy and with the full realization that
the money belong to the policy holders.
Objectives of LIC
32. Unit Trust of India
Unit Trust of India (UTI) is a statutory public sector investment
institution which was set up in February 1964 under the Unit Trust of India Act,
1963. UTI began operations in July 1964. It provides opportunity for small-
savers to invest in areas where their risk is diversified.
The Unit-holders, if necessary, can sell their units to UTI at the prices
determined by UTI. One of the attractions is that the investment in UTI has an
income-tax rebate and the income from the UTI is exempted; from income-tax
subject to certain limits.
33. The primary objectives
To encourage and pool the savings of the middle and low income groups.
To enable them to share the benefits and prosperity of the industrial
development in the country.
Objectives
34. To accept discount, purchase or sell bills of exchange, promissory note,
bill of lading, warehouse receipt, documents of title to goods etc.,
To grant loans and advances.
To provide merchant banking and investment advisory service.
To provide leasing and hire purchase business.
To extend portfolio management service to persons residing outside India.
To buy or sell or deal in foreign exchange dealings.
To formulate unit scheme or insurance plan in association with or as
agent of GIC.
To invest in any security floated by the Central Government, RBI or
foreign bank.
Functions of UTI
35. 1. Unit scheme—1964.
2. Unit Linked Insurance Plan—1971.
3. Children Gift Growth Fund Unit Scheme—1986.
4. Rajyalakhmi Unit Scheme—1992.
5. Senior Citizen’s Unit Plan—1993.
6. Monthly Income Unit Scheme.
7. Master Equity Plan—1995.
8. Money Market Mutual Fund—1997.
9. UTI Growth Sector Fund—1999.
10. Growth and Income Unit Schemes.
Schemes of UTI
36. Section 45I of the Reserve Bank of India Act, 1934 defines ‘‘non-banking
financial company’’ as–
A financial institution which is a company;
A non-banking institution which is a company and which has as its principal
business the receiving of deposits, under any scheme or arrangement or in
any other manner, or lending in any manner;
Such other non-banking institution or class of such institutions, as the Bank
may, with the previous approval of the Central Government and by
notification in the Official Gazette, specify
NON BANKING FINANCIAL INSTITUTIONS
37. Concept of NBFC
A Non-Banking Financial Company (NBFC) is a company registered under the
Companies Act, 2013 engaged in the business of loans and advances, acquisition of
shares/stocks/bonds/debentures/securities issued by Government or local authority or
other marketable securities of a like nature, leasing, hire-purchase, insurance business,
chit business but does not include any institution whose principal business is that of
agriculture activity, industrial activity, purchase or sale of any goods (other than
securities) or providing any services and sale/purchase/construction of
immovable property.
38. Type of NBFCs
Asset Finance
Company
(AFC)
Investment
Company
(IC)
Loan
Company
(LC)
Infrastructure
Finance
Company
(IFC)
Systemically
Important
Core
Investment
Company
(SIC-ND-SI)
Infrastructure
Debt Fund:
Non-
Banking
Financial
Company
(IDFNBFC)
Non-Banking
Financial
Company -
Micro
Finance
Institution
(NBFCMFI
Non-Banking
Financial
Company –
Factors
(NBFC-
Factors)
Mortgage
Guarantee
Companies
(MGC)
NBFC- Non-
Operative
Financial
Holding
Company
39. An AFC is a company which is a financial institution carrying on as its
principal business the financing of physical assets supporting
productive/economic activity, such as automobiles, tractors, lathe machines,
generator sets, earth moving and material handling equipment's, moving on
own power and general purpose industrial machines. Principal business for this
purpose is defined as aggregate of financing real/physical assets supporting
economic activity and income arising there from is not less than 60% of its total
assets and total income respectively.
Asset Finance Company (AFC)
40. IC means any company which is a financial institution carrying on as
its principal business, the acquisition of securities.
Investment Company (IC)
LC means any company which is a financial institution carrying on as
its principal business, the providing of finance whether by making loans or
advances or otherwise for any activity other than its own but does not include
an Asset Finance Company.
Loan Company (LC):
IFC is a non-banking finance company a) which deploys at least 75 per cent of
its total assets in infrastructure loans, b) has a minimum Net Owned Funds of Rs 300
crore, c) has a minimum credit rating of ‘A ‘or equivalent d) and a CRAR of 15%.
Infrastructure Finance Company (IFC)
41. Systemically Important Core Investment Company
NBFC carrying on the business of acquisition of shares and securities which satisfies
the following conditions:-
It holds not less than 90% of its Total Assets in the form of investment in equity
shares, preference shares, debt or loans in group companies
Its investments in the equity shares (including instruments compulsorily
convertible into equity shares within a period not exceeding 10 years from the
date of issue) in group companies constitutes not less than 60% of its total assets;
It does not trade in its investments in shares, debt or loans in group companies
except through block sale for the purpose of dilution or disinvestment;
42. It does not carry on any other financial activity referred to in Section 45I(c) and 45I(f)
of the RBI act, 1934 except investment in bank deposits, money market instruments,
government securities, loans to and investments in debt issuances of group companies
or guarantees issued on behalf of group companies.
Its asset size is Rs 100 crore or above and
It accepts public funds
43. IDF-NBFC is a company registered as NBFC to facilitate the flow of
long term debt into infrastructure projects. IDF-NBFC raise resources through
issue of Rupee or Dollar denominated bonds of minimum 5 year maturity.
Only Infrastructure Finance Companies (IFC) can sponsor IDFNBFCs.
Infrastructure Debt Fund: Non- Banking Financial
Company (IDFNBFC)
44. Non-Banking Financial Company - Micro Finance Institution
(NBFCMFI)
NBFC-MFI is a non-deposit taking NBFC having not less than 85% of
its assets in the nature of qualifying assets which satisfy the following criteria.
Loan disbursed by an NBFC-MFI to a borrower with a rural household
annual income not exceeding Rs 1,00,000 or urban and semi-urban
household income not exceeding Rs 1,60,000
Loan amount does not exceed Rs 50,000 in the first cycle and Rs 1,00,000 in
subsequent cycles
Total indebtedness of the borrower does not exceed Rs 1,00,000
45. Tenure of the loan not to be less than 24 months for loan amount in excess of Rs 15,000
with prepayment without penalty
Loan to be extended without collateral
Aggregate amount of loans, given for income generation, is not less than 50 per cent
of the total loans given by the MFIs
Loan is repayable on weekly, fortnightly or monthly installments at the choice of the
borrower
Non-Banking Financial Company - Micro Finance Institution
(NBFCMFI) Cont.,
46. NBFC Factor is a non deposit taking NBFC engaged in the principal
business of factoring. The financial assets in the factoring business should
constitute at least 50 percent of its total assets and its income derived from
factoring business should not be less than 50 percent of its gross income.
Non-Banking Financial Company – Factors (NBFC-Factors)
MGC are financial institutions for which at least 90% of the business
turnover is mortgage guarantee business or at least 90% of the gross income
is from mortgage guarantee business and net owned fund is Rs 100 corer.
Mortgage Guarantee Companies (MGC):
47. It is a financial institution through which promoter / promoter groups will
be permitted to set up a new bank . It’s a wholly-owned Non-Operative Financial
Holding Company (NOFHC) which will hold the bank as well as all other
financial services companies regulated by RBI or other financial sector
regulators, to the extent permissible under the applicable regulatory prescriptions.
NBFC- Non-Operative Financial Holding Company (NOFHC)
48. FINANCIAL SERVICES
As per section 65(10) of the Finance Act, 1994, “banking and financial
services” means the following services provided by a banking company or a financial
institution including a non banking financial company, namely;
(i) FINANCIAL LEASING SERVICES INCLUDING EQUIPMENT LEASING AND HIRE-PURCHASE BY A BODY
CORPORATE;
(ii) CREDIT CARD SERVICES;
(iii) MERCHANT BANKING SERVICES;
(iv) SECURITIES AND FOREIGN EXCHANGE (FOREX) BROKING;
(v) ASSET MANAGEMENT INCLUDING PORTFOLIO MANAGEMENT, ALL FORMS OF FUND MANAGEMENT, PENSION
FUND MANAGEMENT, CUSTODIAL DEPOSITORY AND TRUST SERVICES, BUT DOES NOT INCLUDE CASH
MANAGEMENT;
(vi) ADVISORY AND OTHER AUXILIARY FINANCIAL SERVICES INCLUDING INVESTMENT AND PORTFOLIO
RESEARCH AND ADVICE, ADVICE ON MERGERS AND ACQUISITION AND ADVICE ON CORPORATE
RESTRUCTURING AND STRATEGY; AND
vii) PROVISION AND TRANSFER OF INFORMATION AND DATA PROCESSING.
49.
50. FunctionsofFinancialServices
Facilitating transactions (exchange of
goods and services) in the economy.
Mobilizing savings (for which the
outlets would otherwise be much more
limited).
Allocating capital funds (notably to
finance productive investment).
Monitoring managers (so that the funds
allocated will be spent as envisaged).
Transforming risk (reducing it through
aggregation and enabling it to be
carried by those more willing to bear
it).
54. Fund based activities: The traditional services which come under fund based activities
are the following:
Underwriting or investment in shares, debentures, bonds, etc. of new issues (primary
market activities).
Dealing in secondary market activities.
Participating in money market instruments like commercial papers, certificate of
deposits, treasury bills, discounting of bills etc.
Involving in equipment leasing, hire purchase, venture capital, seed capital etc.
Dealing in foreign exchange market activities. Non fund based activities
55. Non fund based activities: Financial intermediaries provide services on the basis of non-
fund activities also. This can be called ‘fee based’ activity. Today customers, whether
individual or corporate, are not satisfied with mere provisions of finance. They expect
more from financial services companies. Hence a wide variety of services, are being
provided under this head. They include:
Managing the capital issue i.e. management of pre-issue and post-issue activities
relating to the capital issue in accordance with the SEBI guidelines and thus enabling
the promoters to market their issue.
Making arrangements for the placement of capital and debt instruments with investment
institutions.
Arrangement of funds from financial institutions for the clients project cost or
his working capital requirements.
Assisting in the process of getting all Government and other clearances
56. Modern Activities
Rendering project advisory services right from the preparation of the project report till the
raising of funds for starting the project with necessary Government approvals.
Planning for M&A and assisting for their smooth carry out.
Guiding corporate customers in capital restructuring.
Acting as trustees to the debenture holders.
Recommending suitable changes in the management structure and management style with a
view to achieving better results.
Structuring the financial collaborations/joint ventures by identifying suitable joint venture
partners and preparing joint venture agreements.
Rehabilitating and restructuring sick companies through appropriate scheme of
reconstruction and facilitating the implementation of the scheme.
Hedging of risks due to exchange rate risk, interest rate risk, economic risk, and political
risk by using swaps and other derivative products.
Managing in-portfolio of large Public Sector Corporations.
57. TRADITIONAL FINANCIAL SERVICES
FUND BASED SERVICES
• Equipment Leasing /
Finance
• Hire Purchase and
Consumer Credit
• Bill Discounting
• Venture Capital
• Housing Finance
• Insurance Services
NON FUND BASED SERVICES
• Issue Management
• Portfolio Management
• Corporate Counseling
• Loan Syndication
• Merger and Acquisition
• Capital Restructuring
• Credit Rating
• Stock Broking etc
58. MODERN FINANCIAL SERVICES
1. Rendering project advisory services.
2. Planning for mergers and acquisitions.
3. Guiding corporate customers in capital restructuring.
4. Acting as Trustees to Debenture holders
5. Recommending suitable changes in financial structure.
6. Structuring the financial collaboration through joint ventures
7. Rehabilitating and reconstructing sick companies through reconstruction.
8. Hedging of risks through derivative trading.
9. Managing portfolio of public sector corporations.
10. Asset liability management.
59. Undertaking risk management services like insurance services, buy-back options etc.
Advising the clients on the questions of selecting the best source of funds taking into
consideration the quantum of funds required, their cost, lending period etc.
Guiding the clients in the minimization of the cost of debt and in the determination of
the optimum debt-equity mix.
Promoting credit rating agencies for the purpose of rating companies which want to go
public by the issue of debt instrument.
Undertaking services relating to the capital market, such as 1)Clearing services,
2)Registration and transfers, 3)Safe custody of securities, 4)Collection of income on
securities.