NCRD’S STERLING INSTITUTE OF MANAGEMENT STUDIES“RETAIL BANKING SYSTEM IN INDIA”PRESENTED BY:VARSHA GOLEKARMMS-II (FINANCE)A-18
Overview Of Bank Performance In Last Five Years
RETAIL BANKING SYSTEM Retail Banking in Retail Stores Way… AS IS / BEFORE TO BE /NOWPRIORITY Credit & Risk Customers & retailingAPPROACH Secure & conventional Customer centric retail location for financial banking transactions (Customer is King) (Banks dictate terms)CUSTOMER BASE Corporation & other banks Retail consumers, corporate clients, other banksFORMATS Single Entity Multi-location, multi branchMORE EMPHASIS Improving transactional Providing service andON efficiency value to consumersCUSTOMIZATION Rarely there Highly customized
PATH FORWARD FOR RETAIL BANKSRETAIL BANK OF TODAY – COMPLEX BANK RETAIL BANK OF FUTURE – LEAN BANK “LEADERS” Retail banks needs P to identify their focus area and build capability in one or two only. Product leader D U “LAGGARDS” Utility Retail banks, Distributor Processor continuing to pursue “ a doing P everything approach” will not be able to build D U strong capability in all models.
MULTI-STATE SCHEDULED CO-OPERATIVE BANKINCORPORATION: 1972BRANCHES: 64PROJECT PLACE: CENTRALIZED RETAIL BANKING CELL (CRBC) , NAUPADA. Techno-savvy Bank Multiple delivery channels such as ATM, Internet, Mobile First Bank in Co-operative sector to install Cheque Depository Machines and Automated Cheque Issuance Machine at 63 branches, which are operational 24 X 7 Bancassurance: Agent for Max New York Life Insurance Co. Ltd. for Life Insurance products and with The Oriental Insurance Co. Ltd. for General Insurance
PROCESSING OF RETAIL LOANS Processing Model Stand Alone Centralised Model ModelRefers to processing of retail loansindependently at the branch level. Refers to processing of loans atBranch will market the retail loans and a centralised place dependingprocess and sanction the loans based upon the geography ofon the eligibility of the applicants. branches.
WORKFLOW OF CENTRALIZED RETAIL BANKING CELL, TJSB The valuation Receipt of application Verification check and (wherever applicable) and details from the Process the application arrive at credit score through the panel branch valuer Advising the sanction of Obtain the Receiving acceptance the loan to the Arrive at the quantum Encumbrance Certificate for the terms and borrower/branch with of finance based on and legal opinion from conditions the terms and type of loan lawyer conditionsExecution of documents Auditing is done by for the loan and also Release of the loan to Verification of end use auditors on weekly completing the the borrower by the borrower basis sometime daily mortgage formalities basis. (wherever applicable)
IMPORTANT THINGS YOU NEED TO KNOW BEFORE APPLYING FOR LOAN You may not be offered the rate you see advertised A secured loan is held against your property Disbursement time of bank The best rates are available to those with the best credit scores The longer the term, the more interest youll pay A credit card may be a better option for short term lending It can cost you to pay back the loan early There may be other hidden fees Service , processing charges, private equity, franking charges, insurance charges Your repayments may be variable – Fixed or Floating You dont have to buy PPI when you take out a loan
GENERAL DOCUMENTS REQUIRED FOR LOAN APPRAISAL PROCESS
1. Promissory note 2. Term loan agreement 3. Deed of guarantee 4. Section 60 – Borrower,GENERAL DOCUMENTS Guarantor 5.Letter of Lien and set off 6. Post dated cheques Housing Personal Education loan Loan Loan 1. Society NOC 2. Sale deed 1. End use declairation 1. Institute fees 3. Title Deed structure 4. Valuation Report Supporting Doucuments 2. Fee receipt 5. Credit Report 3.Educational 6. Non encumbrance certificate Certificates 7. Mortgage deed Other supporting Other supporting document documents
RECOVERY OF LOANRecovery Policy clauses - Approaches torecovery of loan, general guidelines Giving notice to Borrowers- Written communication, telephonic reminders or visits by TJSB bank recovery agent Repossession of security- To recover dues and not to deprive the borrower, realisation of security after notice to borrower Valuation and Sale of property- Sale of repossessed property by TJSB bank - opportunity for borrower to repurchase the property
DATA ANALYSIS AND INTERPRETATION OF TJSB SAHAKARI BANK LTD.
Outcome Here • TJSB’s deposits has increased by 25.16% - shows opportunities for further growth. • Advances has increased by 32.55% in 2012, shows retail segment growth • Gross NPA has decreased and CRAR has also decreased by 0.61%. It also reflects the efficacy of banks’ credit risk management and the recovery environment. % Increase/Decrease 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% -5.00% Deposits Advances Net Profit Gross C.R.A.R N.P.A% Increase/Decrease 25.16% 32.55% 21.20% -0.79% -0.61%