Title of the Term Paper: Banking Sector Group No: 2

Submitted to: Dr. MOUSUMI SENGUPTA

Submitted by: ASHISH PATODIA(11127) BRUNDA M(11132) GIRISH S D(11137) JANAKISHAN REDDY Y(11142) LIJIN RAJ (11147) NAVIN PRAKASH (11152) PAUL JOSEPH FERNANDEZ (11157) RAHUL M K (11162) SAMRAT RAHA(11167) SOUMYA SIDDHARTHA ROUT(11172) VAMSI KRISHNA N V(11177)
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Contents
Background Information.....................................................................................................3 Major Players......................................................................................................................6 Data collection Bank of Baroda...............................................................................................................7 State Bank of Mysore.....................................................................................................14 HDFC Bank....................................................................................................................16 Similarities and Differences...............................................................................................20 Findings and Conclusion....................................................................................................21 References..........................................................................................................................22

Background information about the sector

The banking system in India is significantly different from that of many other nations because of the countrys unique geographic, social, and economic characteristics. The Banking industry in India started with the setting up of The General Bank of India in 1786, and Bank of Hindustan in 1790(Both of which have since become defunct). A couple of decades later, foreign banks like Credit Lyonnais started their Calcutta operations in the 1850s. The oldest bank in existence in India is the State Bank of India (SBI), which originated as the Bank of Calcutta in June 1806 which later came to be known as the Bank of Bengal. This was later joined by the Bank of Bombay and the Bank of Madras, all three of which were established under charters from the British East India Company and where known as the presidency banks. For many years, these banks acted as quasi-central banks until they were merged in 1921 to form the Imperial Bank of India and it acted like a Central bank and as a banker for other banks The RBI (Reserve Bank of India) was established in 1935 as the Central Bank of the Country. In 1949, the Banking Regulation act was passed and the RBI was nationalized and acquired extensive regulatory powers over the commercial banks. During the 1950s and 60s, there was wave of nationalization, which started with the nationalization of the Imperial bank in 1955 and the acquiring of eight state owned banks to form the State bank group. Later the Government Nationalized six more commercial private sector banks such as Andhra bank,Vijaya bank etc. The main objective of nationalizing was to extend banking facilities on a large scale more particularly in the rural and semi-urban areas and to diverse other public purposes. The 1990s ushered in a new phase called Liberalization era which was guided by the recommendations of the Narasimhan committee and spearheaded by economists such as Dr Manmohan Singh. This started with the licensing of a few private banks. These came to be known as New Generation tech-savvy banks, and included Global Trust Bank, Axis Bank, ICICI Bank, HDFC Bank etc. The next stage for the Indian banking has been set up with the proposed relaxation in the norms for Foreign Direct Investment, where all Foreign Investors in banks may be given voting rights which could exceed the present cap of 10%,at present it has gone up to 74% with some restrictions This move, along with the rapid growth in the economy of India,
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revitalized the banking sector in India, which has seen rapid growth with strong contribution from all the three sectors of banks, namely, government banks, private banks and foreign banks. The country today is flooded with foreign banks and their ATM stations. Efforts are being put to give a satisfactory service to customers. Such latest technologies as phone banking and net banking have been introduced. The entire system became more convenient and swift. Financial Structure The Indian financial system comprises the following institutions: 1. Commercial banks a. Public sector b. Private sector c. Foreign banks d. Cooperative institutions (i) Urban cooperative banks (ii) State cooperative banks (iii) Central cooperative banks 2. Financial institutions a. All-India financial Institutions (AIFIs) b. State Financial Corporations (SFCs) c. State Industrial Development Corporations (SIDCs) 3. Nonbanking Financial Companies (NBFCs) 4. Capital Market Intermediaries

The public sector commercial banks are divided into three categories. State Bank Group: The group consists of 8 Banks. This consists of the State Bank of India (SBI) and Associate Banks of SBI. The Reserve Bank of India (RBI) owns the majority share of SBI and some Associate Banks of SBI. SBI has 13 head offices governed each by a board of directors under the supervision of a central board. The board of directors and their

committees hold monthly meetings while the executive committee of each central board meets every week. Nationalized Banks: The group consists of 19 banks. In 1969, the Government arranged the nationalization of 14 scheduled commercial banks in order to expand the branch network, followed by six more in 1980. Nationalized banks are wholly owned by the Government, although some of them have made public issues. In contrast to the state bank group, nationalized banks are centrally governed, i.e., by their respective head offices. Thus, there is only one board for each nationalized bank and meetings are less frequent (generally, once a month). The state bank group and nationalized banks are together referred to as the public sector banks (PSBs). Regional Rural Banks (RRBs): In 1975, the state bank group and nationalized banks were required to sponsor and set up RRBs in partnership with individual states to provide low-cost financing and credit facilities to the rural masses. Reserve Bank of India and Banking and Financial Institutions RBI is the banker to bankswhether commercial, cooperative, or rural. The relationship is established once the name of a bank is included in the Second Schedule to the Reserve Bank of India Act, 1934.Such bank, called a scheduled bank, is entitled to facilities of refinance from RBI, subject to fulfilment of the conditions laid down in Section 42(6) of the Act. RBI is authorized to exclude the name of any bank from the Second Schedule if the bank, having been given suitable opportunity to increase the value of paid-up capital and improve deficiencies, goes into liquidation or ceases to carry on banking activities.

Major players in Indian and global market in the same sector

List of Major Banks in India (Based on the Number of Branches) Bank Name State Bank of India Punjab National Bank Central Bank Of India Bank Of India Canara Bank Bank of Baroda Union Bank of India Syndicate Bank ICICI Bank Allahabad Bank UCO Bank Indian Overseas Bank HDFC Bank Indian Bank Oriental Bank of Commerce

List of Major Global Banks Bank Name Citigroup Deutsche Bank Allianz AG BNP Paribas HSBC J.P. Morgan & Chase Co. Bank of America Royal Bank of Scotland ABN Amro Royal Bank of Canada
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Data Collection
Bank of Baroda
Bank of Baroda General Transfer policy The Bank of Baroda effects transfers of its employees on the basis of Regulation 47 of the Bank of Baroda (Officers) Service Regulations, 1979 In Bank of Baroda officers are transferred: 1) On Promotion 2) Under Job Rotation 3) For providing Rural/Semi-urban branch experience.

1. On Promotion Officers are transferred on promotion from surplus to deficit zones. Such transfers necessitated for bringing about a balance of staff in all zones are done pursuant to completion of promotion exercise depending upon the requirements of each zone. In the transfer exercise of officers from surplus to deficit zones, officers are identified on the basis of merit list of the promotion exercise by following the descending order of merit. In such transfers, exemptions are given to the following: i) Officers who were transferred out of the zone/state in the past and who have completed three years of service on such transfers. ii) Officers in the age group of 55 years and above. Transfers of such officers who are not to be transferred from surplus to deficit zones are decided depending upon the needs of the zone and the suitability of officers.

2. Under Job Rotation Officers have to be rotated from one office/branch to another office/branch on completion of 3 years period at an office/branch. These guidelines have been implemented by the Bank and Job rotation of Officers is done accordingly.

3. Rural/Semi Urban Posting For promotions to scales II & III an Officer is required to put in 2/3 years service in a Rural/Semi - Urban branch. Exemption from Rural/Semi-urban posting is being given to specialist officers; officers posted in EDP Cells/ abroad and physically handicapped officers etc. in terms of the directives received from the Govt.
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The above transfer policy is applicable to officers in Junior Management Grade/Scale I, Middle Management Grade/Scale II and Middle Management Grade/ Scale III. As regards officers in Senior Management Grade/Scale IV and above, postings are decided by the Bank by taking into account administrative needs and suitability.

Career Progression in the Bank Promotions are mainly decided on the twin factors of performance and potential. Motion exercises are regularly carried out by the Bank every year in all grades / scales and hence, sufficient progression opportunities are available to deserving officers.

GENERAL MANAGER ASSISTANT GENERAL MANAGER DEPUTY GENERAL MANGER

CHIEF MANAGER

SENIIOR MANGER

MANAGER

OFFICER

BANK OF BARODA EMPLOYEES DISCIPLINE AND APPEAL Appellate Authority means the designated authority to dispose of appeals in case of conflicts and disagreements. PENALTIES The following are the penalties, which may be imposed on an officer employee, for acts of misconduct or for any other good and/or sufficient reasons.

MINOR PENALTIES (a) Censure, (b) Withholding of increments of pay with or without cumulative effect; (c) Withholding of promotion; (d) Recovery from pay or such other amount as may be due to him of the whole or part of any pecuniary loss caused to the Bank by negligence or breach of orders; (e) Reduction to a lower stage in the time scale of pay for a period not exceeding 3 years, without cumulative effect and not adversely affecting the officers pension.

MAJOR PENALTIES (g) Reduction to a lower grade or post; (h) Compulsory retirement; (i) Removal from service, which shall not be a disqualification for future employment; (j) Dismissal, which shall ordinarily be a disqualification for future employment.

SUSPENSION (1) An officer employee may be placed under suspension by the competent authority(a) Where a disciplinary proceeding against him is contemplated or is pending; or (b) Where a case against him in respect of any criminal offence is under investigation, inquiry or trial. (2) An officer employee shall be deemed to have been placed under suspension by an order of the competent authority(a) With effect from the date of his detention, if he is detained in custody, whether on a criminal charge or otherwise, for a period exceeding forty-eight hours; (b) With effect from the date of conviction, if in the event of a conviction for an offence, he is sentenced to a term of imprisonment exceeding forty-eight hours and is not forthwith dismissed or removed or compulsorily retired consequent to such conviction.

Posts/Grades of Officers immediately prior to July 1979 1 2 3 4 General Managers Deputy General Managers and Chief Legal Adviser Assistant General Managers Regional Managers, Chief Managers and Dy. Chief officers Top Executive Grade Scale VII Top Executive Grade Scale VI Senior Management Grade Scale V Senior Management Grade Scale IV 1st Grade in which Placed

All Assistant Chief Officers and All Officers in 'A' & 'B' Salary 5 Grades (other than those fitted in Senior Management Grade Scale IV & V) All Officers in 'C' & 'D' Salary 6 Grades (other than those Middle Management Grade Scale II Middle Management Grade Scale III

fitted in Middle Management Grade/Scale III and above)

All Officers in 'E' & 'F' Salary Grades Junior Management Grade Scale I

SCALES OF PAY Scale I = Rs.10000 12820 14320 - 18240 Scale II = Rs.13820 - 14320 19920 Scale III = Rs.18240 21040 22280 Scale IV = Rs.20480 21040 - 24140 Scale V = Rs.24140 - 26620 Scale VI = Rs.26620 - - 29340 Scale VII = Rs.29340 30700 31600 - 32600 .

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PERSONAL ALLOWANCES The allowances permitted by the bank are the following i. House Rent Allowance, wherever payable. ii. Post Allowances to Branch Managers/ Accountants/Assistant Chief Officers/ Deputy Chief Officers. iii. City Compensatory Allowance iv. Agent's Allowance v. Split Duty Allowance. vi. Hill & Fuel Allowance. vii. Custodian Allowance. viii. Project Area Compensatory Allowance. ix. Temporary Special Allowance.

Dearness Allowance: Allowance shall be payable for every rise or fall of 4 points over 2288 points in the quarterly average of the All India Average Working Class Consumer Price Index (General) Base 1960 at the following rates : (i) 0.18% of pay up to Rs.9, 650/- plus (ii) 0.15% of pay above 9,650/- and up to Rs.15, 350/- plus (iii) 0.09% of pay above 15,350/- and up to Rs.16, 350/- plus (iv) 0.04% of pay above Rs.16, 350

House Rent Allowance: 1 Major A Class Cities and Project Area Centres in Group A 2 Other places in Area I and Project Area Centres in Group B 3 Other places 6.5% of Pay 7.5% of Pay 8.5% of Pay

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City Compensatory Allowance CCA is awarded to the person working in specified places as mentioned in the table below Area 1 Places in Area 1 and in the State of Goa 2 Places with population of five lakhs and over and State Capitals and Chandigarh, Pondicherry and Port Blair 4% of Basic Pay 3% of Basic pay Rs.375/- p.m. Rate Max Amount Rs.540/- p.m.

1. If an officer is transferred from one place to another in the midst of an academic year and if he has one or more children studying in school or college, in the former place, a Mid- Academic Year Transfer Allowance of Rs. 150/- p.m. from the date he reports to the latter place up to the end of the academic year in respect of all the children, provided that such allowance shall cease if all the children cease studying at the former place. 2. If an officer is deputed to serve outside the Bank, he may opt to receive the emoluments attached to the post to which he is deputed. Alternatively, he may be in addition to his pay, draw a Deputation Allowance of 7.75 % of pay subject to a maximum Rs. 1000/- and such other allowances as he would have drawn had he been posted in the Bank's service at that place. 3. If he is required to officiate in a post in a higher scale for continuous period of not less than 7 days at a time or an aggregate of 7 days during a calendar month, he shall receive an Officiating Allowance equal to 6% of his pay, pro-rata for the period for which he officiates. 4. If he is posted at a branch where books are closed on 31st March and 30th

September a Closing Allowance of Rs. 250/- for each of the two closings. 5. If his working hours during a day are split with minimum interval of 2 hours, a Split duty Allowance of Rs.125/- p.m. 6. If an officer is required to work as custodian of a vault or locker on a holiday, a Diem Allowance at the rate to which he is entitled. 7. If an officer is required to work in high altitudes and hill areas a special Hill and Fuel Allowances is provided.

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LEAVE Kinds of Leave: Subject to the grant of leave being determined by the exigencies of service, an officer shall be eligible for the following kinds of leave:

1. Casual leave An officer shall be eligible for Casual Leave on full emoluments for12 working days in a year provided that not more than four days casual leave may be availed of at any time. Casual leave not availed of in any year may be suffixed or prefixed to sick leave in the following year

2. Privilege leave An officer shall be eligible for privilege leave computed at one day for every 11 days of service on duty provided that at the commencement of service, no privilege leave may be availed of, before completion of 11 months of service on duty. An officer on privilege leave shall be entitled to full emoluments for the period of leave.

3. Sick leave An officer shall be eligible for 30 days of sick leave for each completed year of service subject to a maximum of 18 32 of 50 months during the entire service. Such leave can be accumulated up to 540 days during the entire service and may be availed of only on production of medical certificate by a medical practitioner acceptable to the bank or at the bank's discretion nominated by it at its cost. In respect of the period of sick leave, an officer shall be eligible to receive one half of the full emoluments.

4. Maternity leave On and from 1st day of April, 2000, leave up to a period of -6- months at a time may be granted by way of Maternity Leave including in respect of post-natal period or at the time of miscarriage or abortion or medical termination of pregnancy.

5. Extra-ordinary leave on loss of pay An officer shall be eligible for extra-ordinary leave on loss of pay for not more than 360 days during the entire period of service. Such leave may not be availed of except for sufficient reasons on more than 90 days at a time. Provided that in very special circumstances, the
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Board may grant extra- ordinary leave on loss of pay to an officer up to a total period of 720 days.

6. Special casual leave and special leave An officer may be granted special casual leave and any special leave as may be decided by the Board in accordance with the guidelines of the Government.

State Bank of Mysore

Training There are two staff training centres of SBM. They are located in Bangalore and Mysore. Every year one compulsory training program has to be attended by all the employees of the Bank. The training is conducted in batches of 30 employees each. There will be periodic training on changes is banking software. Compensation Salary settlements are at the national level. There are various scales which an employee can get promoted to. All employees will start at Scale 1. One can climb up the ladder by merit or through experience. A scale 2 employee will be a Branch Manager in charge of branch with 15 crores turnover. Similarly for scale 3 it is 50 crores and 100 crores turnover branch for a scale 4 Branch Manager. The position of Assistant General Manager will have a scale of 5. Promotion Policy Promotion is either on the basis of seniority or merit. The bank provides free pre-promotional training for SC/ST employees. There are lot of promotional opportunities at present. Transfer Policy All officer cadre employees are subjected to transfer every 3 years and award staff once in 5 years. The Bank has preferential transfer policy if both husband and wife work for SBM.

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Benefits 1. Incentives are given for better performing regions with performance parameters being NPA, Deposits, and Advances. 2. Leave Travel Concession once in 4 years. 3. Allowance for telephone and newspaper. 4. Allowance for 105 litres of petrol per month. 5. Loans carry simple interest of 7%. 6. Group insurance under staff welfare policy. 7. Scholarship for 2 kids (for scores above 60%) 8. Maternity leave for 6 months and for 3 times. 9. Cash gift on employee birthday. 10. Medical reimbursement i) ii) iii) Issues: Bringing political intervention in matters connected to transfers had increased in the recent times. Hence the management has issued a circular prohibiting such practices and if the same practice continues then employees will face disciplinary action. Learnings SBM has one Deputy General Manager in the head office to look into the HRM issues connected with the bank. The bank leaves no matter unresolved when it comes to employee grievances. The attrition rate is very low, hence their might be a taken for granted attitude among employees when it comes to performance. The bank has a policy to have the right man in the right job. It has very few branches outside Karnataka state which the bank can work on. Self -100% Dependents 75% Children Some percentage of the medical bill.

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HDFC BANK
RECRUITMENT & SELECTION PROCESS Recruiting and selecting the right people is paramount to the success of the HDFC BANK LTD. and its ability to retain a workforce of the highest quality. This recruitment and selection policy sets out the procedure to ensure that the best people are recruited on merit and that are the recruitment process is free from bias and discrimination. PRINCIPLES: Following are the guiding principles for recruitment and on-boarding process. Attracting and recruiting the right people. Merit will be the single most important factor in selection process. Ensure diversity, both gender and ethnicity by targeted candidate sourcing with the help of recruitment vendors and the referral program. Hiring people who are team players and have the right attitude most relevant to the culture of the organization. Attitude is as important as aptitude. They believe in providing their employee with fulfilling career paths. Towards this, they will post vacancies internally as a preferred option while evaluating external candidates. They treat all the candidates with the utmost respect. They will be open and fair in communication with them; this way they also enhance the brand image of the organization. They will continuously assess, identify and cultivate strategic talent pools including those at the universities, management schools, and community forums to address their long term needs. HIRING APPROVAL All recruitment activities shall be undertaken based on the hiring plan as approved by the Business Head, HR Head & the CEO. For each approved position, a hiring requisition will be required prior to initiation of any recruitment activity. If the hiring was not included in the planned budget, it will also require approval from the CEO based on a recommendation from the Head HR and the CFO. Recruitment expense will be allocated to the concerned business unit, and expenditure should be budgeted and pre-approved by the business unit head and the HR Head.

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CANDIDATE SOURCING:

The hiring manager along with the Human Resource Department would decide the channel / source to use based on the nature of the recruitment. The following sources of recruitment may be considered: Internal Sources: - Whenever any vacancy arises, the possibility of fulfilling the requirement internally via reassignment and relocation, re-allocation of the responsibilities or internal promotion will be explored by the hiring function along with the HR Department. - Internal job postings to explore internal candidates. Employee Referrals HDFC will encourage employees to refer suitable candidates for open positions. Other external sources include: - Recruitment agencies - External job postings - College / campus requirement - Requirement advertisements

APPLICATION PROCESSING HDFC will process all applications promptly and inform the applicant or source regarding the status of the application. HDFC will respond to all solicited applications within 5 working days of receiving the application.

PRE-EMPLOYEMENT CHECKS This will include both a professional reference check as well as the background check. Professional reference check will be completed by the hiring manager. HDFC will request contact information for 2 references from the candidate, and check the quality of previous work experience and key personal characteristics/conduct/ previous record etc. For key positions in areas, HDFC will also perform a background check to assess the integrity / conduct of the candidate. The following information regarding the candidate will be verified: Proof of educational qualifications Any professional certificate that is essential to the job Address details Passport details Date of birth Proof of previous employment (service certificate)
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Any negative feedback and comment in the reference check will be investigated by HR and if found genuine shall be a cause for disqualification of the candidate or dismissal from employment.

OFFER PROCESS Once the hiring decision is finalized, HR will prepare an offer / fitment as per the compensation structure and grade and keeping in mind the internal equity. The offer would be communicated to the selected candidates by the hiring manager along with HR. The candidate will sign the contract letter to formally accept employment from the organization.

PRE-EMPLOYMENT PROCESS As an organization, HDFC will make all necessary arrangements to ensure a smooth joining process for the employees. HR will provide the candidate a check list prior to joining to ease joining formalities. EMPLOYEE ON-BOARDING PROCESS The overall purpose of the new hire integration process is to ensure that the new employee is able settle in smoothly and is able to contributing at the earliest.

PRE EMPLOYMENT INDUCTION HDFCs employee induction process shall begin as per the employee accepts the job offer. The process includes: Welcome pack: As soon as the candidate accepts the offer, a welcome pack will be sent to the employee A congratulatory note regarding the decision to join the organization Contact details of a HR representative and the hiring manager A brief company overview document Pre-joining checklist: Include details of the documents required from the employee. In case the employee is relocating from a different location, details of the relocation process and the visa requirement will be outlined in this checklist Expectations on the first day of the joining Office resources: HR shall intimate the immediate supervisor the joining date and immediate supervisor shall work with the IT and administration team to set up the following 5 days prior
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to employee joining, the following elements and are in working order: Email ID, phone, computing resources, work space/office, access cards, joining kit including bank account opening form, initial reading material

POST JOINING ORIENTATION AND INDUCTION Joining kit: The employee upon joining would be welcomed by the HR representative and would be given a joining kit that will include: Access card, information on employees email and phone number, Bank account opening form, corporate insurance application form(if applicable),HR & Admin policy manual, other relevant reading material ( to be prepared by hiring manager) Classroom Induction: The employee integration process will also include classroom training and induction where the employee will receive presentations and trainings on various topics that would further ingrain the into the organization On the job training: Besides formal training sessions, the employee will undergo on-the-job function specific trainings that are facilitated by the respective functions to help the new employee acquaint himself/herself with work in progress.

PROBATION POLICY Probation is a trial that is mutual opportunity for the employee and HDFC to confirm suitability for continued employment. The probation period is to establish a stronger understanding of mutual capabilities, expectations and understanding which may include functional training. The employee must demonstrate suitability for continued employment. An assessment will be based on factors related to work performance, work habits, productivity, attitude and compatibility, attendance and punctuality, and any other matter that is linked to job performance and expectations. All new hires will be placed on probation for a period of 6 months from the date of joining HR will initiate the confirmation process by sending an appraisal form to the immediate supervisor before the completion of probationary period. The appraisal form will need to be approved by the supervisors leadership All letters of confirmation or extension of probation will be signed by the HR head and will be stored in employee file for records.

REFERRAL BONUS AMOUNT The Referral Bonus Program is operated under the authority of the Budget and Control
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Boards Employee Bonus Guidelines. Under these guidelines, an employee may receive multiple bonuses, the total of which may not exceed $2,000 in any fiscal year. Referral bonus payments may be paid in a lump sum or in periodic payments until the new employee has completed his or her probationary period. Payments cannot be made until the referred candidate has been employed for a minimum of one month. For example, a $1,000 referral bonus can be structured as follows: - $250 referral bonus awarded after three months from the hire date, - $250 referral bonus awarded after six months from the hire date, - $500 referral bonus awarded at the end of the probationary period.

Similarities and differences in terms of HR strategies and policies among the three banks
SBI Training 1. One compulsory training program has to be attended by all the employees of bank. 2. There will be periodic training on changes in banking software. 1. Training programs are conducted every year and it is made sure that employees are updated on latest banking practices. 1. Provides basic framework for a comprehensive and multifaceted training program that seeks to improve the all-round competencies of employees. 2. For senior management, education program that focuses on developing business leaders for future. 3. Our managers skills are regularly updated through various knowledge management initiatives. Compensation 1. Salary settlements are at national level. 2. In scale1 they get promoted by merit or through experience. 3.In scale 2 the branch manager in charge of bank with 15 crores turnover 1. It is designed to cover ideas related to unauthorized debiting of accounts, payment of interest to customers for delayed collection of cheques, payments of cheques after acknowledgement of stop 1. Performance-linked incentive packages for our employees. 2.Welfare benefits such as financial assistance in times in need, loans to assist payment of health-related expenses reimbursement of medical HDFC Bank of Baroda

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payment instructions, remittances within India. 2. Policy is based on principles of transparency and fairness of customer. Promotion policy

expense, academics scholarships etc.

1. On the basis of seniority or merit. 2. Free promotional training for SC/ST employees Transfer policy

1. On the basis of seniority or merit.

1. On the basis of seniority or merit.

1. For every 3 years. 2. Award staff once in 5 years. 3.Preferance transfer policy

1.Transfer on promotion 2. Transfer when requirement arises in new branches.

1. Transfer on promotion. 2. Under job rotation. 3.For providing rural/semiurban experience as required under regulation 17 of the Bank of Baroda service regulations

FINDINGS
1. Many people in the organization today are in the wrong jobs and as a result, they are not utilizing their full potential. 2. Hiring people based on personal connections when the person is not qualified for the job. 3. Most recruitment that involves managers is done during discussions at lunch hour, at social clubs or during the coffee break time. 4. Inadequate recruitment procedures resulted in a number of staff not being sufficiently qualified either for the positions they hold or their grades levels, especially in management positions. 5. Psychometric test is not conducted during the selection process. 6. Confusion in the designation and level to the employees even after permanent status for employment is given. 7. Proper training is not given to the recruitment team and manager. 9. Reaching few prospects due to internal recruitment, internet advertising most of the time.
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CONCLUSION
Recruitment is essential for effective Human Resource Management. It is the heart of the whole HR systems in the organization mainly in the service industry. The effectiveness of many other HR activities, such as selection and training depends largely on the quality of new employees attracted through the recruitment process. In Banking Sector policies should always be reviewed as these are affected by the changing environment. Management should get specific training on the process of recruitment to increase their awareness on the dangers of wrong placements. Effective recruitment is important in achieving high organizational performance and minimizing labour turnover. As of now Banks have a team of effective human resource which is efficiently managing the organization at its best. Though the recruitment process adopted by the organization needs to be improved, challenges are ahead for the HR Department to recruit people according to the changing business environments.

REFERENCES The Indian Banking Sector On the Road to Progress- G. H. Deolalkar (Former Managing Director of State Bank of India). Mr Raghuram, Assistant General Manager, State Bank of Mysore Staff Training College, Mysore. Mr. Jhanardhan, Assistant Branch Manager, HDFC Bank, Saraswathipuram, Mysore Mr. Ganesh Kumar, Assistant General Manager, Southren Zone, Kerala.

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