BANKING : Corporate And

Investment
GROUP 7

Banking :
Banking Regulation Act of India, 1949 defines Banking as
accepting for the purpose of lending of investment on
deposits of money from the public which is repayable on
demand or withdrawal by cheque , draft order . The
Reserve Bank of India Act, 1934 and the Banking Regulation
Act, 1949, govern the banking operations in India.

Banking Structure in India:

A well-regulated banking system is a key comfort for local and foreign

stake-holders in any country.

Prudent banking regulation is recognized as one of the reasons why India
was less affected by the global financial crisis.
Banks can be broadly categorized as Commercial Banks or Co-operative
Banks.
Banks which meet specific criteria are included in the second schedule of
the RBI Act, 1934. These are called scheduled banks.

Structure of Banks in India

Current period :
All banks which are included in the Second Schedule to

the Reserve Bank of India Act 1934 are Scheduled Banks.

Scheduled Commercial Banks in India are categorised into
five different groups according to their ownership and/or
nature of operation. These bank groups are:
State Bank of India and its Associates
Nationalized Banks
Private Sector Banks
Foreign Banks
Regional Rural Banks

Adoption of Banking Technology

The RBI set up a number of committees to define and coordinate banking technology. These have included:
Introducing of MICR technology in all the banks in the
metropolises in India .
In the year 1988, the RBI set up the Committee on
Computerization in Banks.
In 1994, the Committee on Technology Issues relating to
Payment systems, Cheque clearing and Securities settlement in
the Banking Industry.

Types of Banks :
Savings Banks- This Banks are suited for employees with a monthly

salary. Low waged people may open an account in the savings bank.
Commercial banks- These banks collects money from people in various

sectors and give the same as a loan to businessmen and make profits
in interest.
Industrial banks- These banks collect cash by issuing shares and

debentures and provides long term loan to industries.

Land Development Banks- These banks are also known as Agricultural

banks because these are formed to finance agricultural sector.

Indigenous Banks- Indigenous banks means money lenders and

sahukars. They collect deposits from general public and grant loans to
the needy people.
Central/National banks- These central banks are the banks of other banks.

It is a non profit making institution. The main responsibility of these bank is

control on currency of a country.
Co-operative banks- they generally give credit facilities to small

farmers, salaried employees, small scale industries, etc.

Consumers banks- The main objective of this bank is to give loans to

consumers for purchase of the durables like motor car, television set,
furniture etc. Consumers have to repay the loans in easy installments .

RTGS System :
'RTGS' stands for Real Time Gross Settlement.
It enables transfer of money in real times.
RTGS payment transaction do not involve any

waiting period.
Majority of commercial banks have employed
RTGS and it is available in over 30472 branches.

Money transfer happens in

real time and directly
through the banking
system

NEFT System :
NEFT stands for National Electronic Funds

Transfer.
It is an online system of transferring funds
between financial institutions.
NEFT functions on a deferred net settlement basis
where transactions are completed in batches at
specific times.
NEFT facility is available in 32407 brunches of
banks.

Money is aggregated in clusters for

reconciliation and settlement

Investment Banks :
Investment Banks helps the companies and

governments and their agencies to raise money by

issuing and selling securities in primary market.
Provides strategic advisory services for mergers ,
acquisitions and other types of financial transactions.
They assist public and private corporations in raising
funds in the capital markets

Functions of Investment Banking :

To help public and private corporations in issuing

securities in the primary market.

Provides financial advice to investors and serves them
by assisting in purchasing securities and trading
securities.
To guarantee by standby underwriting or best efforts
selling and foreign exchange management.
Other services include acting as intermediaries in
trading for clients.

Instruments in Investment Banking :

Certificates of Deposits are the most convenient

instruments to depositors as they enable their short term

surpluses to earn higher return.
Treasury Securities - Treasury securities are usually easy to
sell on the secondary market, but they typically pay a low
rate of interest relative to other financial instruments.
Bonds a debt instrument issued for a period of more than
one year with the purpose of raising capital by borrowing.
Equity Securities an instrument that signifies an ownership
position in a corporation and represents a claim on its
proportional share in the corporations assets or profits.

Corporate Banking :
Corporate banking refers to financial services offered to
large clients. It is also a very profitable division for banks.
Financial services provided by banks to the Corporate for
meeting their banking and financial needs for :
Setting up new projects
Expansion
Diversification
Modernization
Financial restructuring
Commercial banking facilities

Services provided under Corporate Banking :

Insurance : These service allow corporate clients to

access many different services within a single financial

institution.
Shareholding : Banks can participate in the
management of own shares in companies.
Project Finance : For large infrastructure and other
projects, banks offer specific loans which are repaid
based on the revenue generated by that project.

THANK YOU
PRESENTED BY:
Rafiya Shaikh
Deesha Gaonkar
Richa Sawant
Sanjana Pednekar
Animesh Talawanker
Nischay Naik