Factors that affect the profitability
Non Performing Assets(NPA)
Net Interest Margin (NIM)
Business & Profit per employee
Cost per transaction
Utilization of technology and human resources
Base rate, MSF, repo rate, CRR and SLR
Basel norms – II and III
Allied banking services
Revenues from fees and commission.
Opportunities in banking
Mortgages to cross Rs.40 Lakh crores by 2020.
Wealth Management to be a big business.
Rapid growth of branches and ATM.
Mobile banking to see huge growth.
Infrastructure financing to reach over Rs.20 trillion
on commercial banks book by 2020.
New Models to serve the Small & Medium
• In 2011-12, the industry faced major concerns in regards
to deteriorating asset quality, with gross non-performing
assets (NPAs) of banks registering a sharp increase in
different sectors such as aviation, infrastructure and
• The present rates:
Bank rate – 8.75%
CRR – 4%
SLR – 3%
Repo rate – 7.75%
Reverse Repo rate – 6.75%
M&A in banking industry
Private Sector Banks Merged with other banks
1. Global Trust Bank (merged with Oriental Bank of Commerce - 14th
2. Bank of Punjab (merged with Centurian Bank, which was later on
merged with HDFC Bank)
3. Centurion Bank (merged with HDFC Bank)
4. The Nedungadi Bank (merged with PNB)
5. The Bank Of Rajasthan (merged with ICICI in 2010)
6. Bharat Overseas Bank (Merged with Indian Overseas Bank)
7. Lord Krishna Bank (Merged with Centurion Bank of Punjab, which
was merged with HDFC Bank)
8. The Sangli Bank (merged with ICICI Bank in 2006)
9. The Ganesh Bank of Kurundwad (merged with Federal Bank)