Commercial Banks

Structure of Banking System in India

Scheduled Banks Non-Scheduled Banks

Central Coop. Banks and primary credit societies State Coop. Banks Commercial Banks

Commercial Banks

Public Sector Banks

Private Sector Banks Old(17) New(8)

Foreign Banks(31)

SBI & Associate Banks(7)

Other Nationalized Banks(20)

Definition of Commercial Banks

An institution which accepts deposits, makes business loans, and offers related services. Commercial banks also allow for a variety of deposit accounts, such as checking, savings, and time deposit. These institutions are run to make a profit and owned by a group of individuals. Commercial banks offer services to individuals, they are primarily concerned with receiving deposits and lending to businesses.

Functions of Commercial Bank

Primary Functions
Accepting Deposits
Current Deposits; Saving Deposits; Fixed deposits; Recurring Deposits; Miscellaneous Deposits.

Granting Loans and Advances.

Short-term Loans
Cash Credit; Overdraft; Discounting of Bills.

Long-term Loans
Demand Loan; Term Loan.

Functions of Commercial Bank Continue

Secondary Functions
Agency Services
Collection and payment of cheques and bills on behalf of the customer; Collection of dividends, interest and rent, etc. on behalf of the customer, if so instructed by them; Payment of rent, interest, insurance premium, etc. on behalf of customers, if so instructed; Acting as agents or correspondents on behalf of customers for other banks and financial institutions at home and abroad.

General utility Services

Issuing letters of credit and travelers' cheques; Underwriting of shares, debentures, etc.; Safe-keeping of valuables in safe deposit locker; Supplying trade information and statistical data useful to customers; Acting as a referee regarding the financial status of customers; Undertaking foreign exchange business.

Commercial Banks at a glance

State bank of India and its associates

Sl. No. Name of bank Year of incorporation 1966 1941 1955 1960 1913

1 2 3 4 5

State Bank of Bikaner & Jaipur State Bank of Hyderabad State Bank of India State Bank of Indore State Bank of Mysore

6
7

State Bank of Patiala

State Bank of Travancore

1917
1945

Nationalized Commercial Banks

Sl. No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Name of bank Allahabad Bank Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra Canara Bank Central Bank of India Corporation Bank Dena Bank IDBI Bank Ltd Indian Bank Indian Overseas Bank Oriental Bank of Commerce Punjab & Sind Bank Punjab National Bank Syndicate Bank UCO Bank Union Bank of India United Bank of India Vijaya Bank Year of incorporation 1865 1923 1908 1906 1935 1906 1911 1906 1938 1994 1907 1937 1943 1908 1895 1925 1943 1919 1950 1931

Old Private Sector Commercial Banks

Sl. No. Name of bank 1 2 3 Catholic Syrian Bank City Union Bank Development Credit Bank Year of incorporation 1920 1904 1995

4
5 6 7

Dhanalakshmi Bank
Federal Bank ING Vysya Bank Jammu & Kashmir Bank

1927
1931 1930 1938

8 9 10
11 12 13 14 15 16 17

Karnataka Bank Karur Vysya Bank Lakshmi Vilas Bank

Lord Krishna Bank Nainital Bank Ratnakar Bank Sangli Bank SBI Comm. & Intl. Bank South Indian Bank Tamilnad Mercantile Bank

1924 1926 1926

1940 1922 1943 1948 1993 1929 1921

New Private Sector Commercial Banks

Sl. No. Name of bank Year of incorporation

1
2 3 4 5 6 7

Centurion Bank
HDFC Bank ICICI Bank IndusInd Bank Kotak Mahindra Bank Axis Bank Yes Bank

1994
1994 1994 1995 1985 1994 2003

Recent Development in Commercial Banking

Interest rate deregulation Electronic Clearing Services (ECS) Electronic Funds Transfer (EFT) The opening of new clearing houses, interconnection of clearing houses through the Indian Financial Network (INFINET) The development of a Real-Time Gross Settlement (RTGS) System Centralized Funds Management System (CFMS)

Continue.
E-banking E-payment Automated teller machines(ATM) Negotiated Dealing System (NDS) The Structured Financial Messaging System(SFMS).