Group No.

Ankita Gada Nilesh Gaikwad Dolly Gatta Hiten Gohil Gayatri Gowekar Paridhi Gupta Twinkle Haria

7422 7423 7424 7427 7428 7429 7430

The Banking & Insurance Industry of India

Introduction
History of more than 200 years
Indian Banking Sector has 6th Rank Globally General Bank of India in 1786 First Bank

Types Of Banks
Public sector Banks Private sector Banks Co-operative Banks Development Bank/Financial institutions

Public sector Banks

Central Bank of India Corporation Bank Dena Bank Bank of India Indian Overseas Bank Oriental Bank of Commerce Punjab & Sind Bank

Private sectors Banks

Old generation private banks New generation private banks:
ICICI bank IDBI bank Axis bank

Foreign banks operating in India :

HSBC bank CITI bank ABN-AMRO bank Standard charted bank

Co-operative Banks
IDBI BANK(Industrial Development Bank of India).

IFCI BANK(Industrial Finance Cooperation of India).

APEX Bank.

Development Banks/Financial Institutions

These banks are mainly used for developing industries and countries. Some Examples

Federal Bank HDFC Bank HSBC ICICI Bank Indian Overseas Bank ING Vysya Bank

FUNCTIONS OF BANKS
Accepting Deposits from public/others (Deposits) Lending money to public (Loans) Transferring money from one place to another

(Remittances)

Acting as trustees
Government business

The Reserve Bank of India

Established on April 1,1935 Nationalized in the Year 1949. It regulates control credit, issue licenses and functions as bankers of

all banks

Major objectives: Regulate the issue of banknote and keeps reserves with a view to

secure monetary stability To operate the credit and currency system of the country to its advantage

EXPORT IMPORT BANK

Established by an Act passed by Indian parliament in

September 1981 Owned by Indian Government

MAIN OBJECTIVE

To provide economic assistance to importers and exporters

To function as a financial institution

Banking Sector in Budget 2008

Small and Marginal Farmers were relieved from all

Farm Loans Indira Awas Yojana was brought under the ambit of public sector banks The Finance Minister also advised the Indian PSU Banks to open 288 branches in minority districts of India In another Landmark decision Finance Minister said the ex-banking service men in India would be offered Employment Opportunities in Banking sector

 Another major announcement was that Banking Cash

Transaction Tax would be withdrawn from the financial year 2009-10

Moreover Experts are Skeptical about long term

benefits of such Agricultural Loan Waiver as offered through the Union Budget 2008-09

Despite Recession, India Gets Record Inflow of Funds

The country is on track to receive as much as $40

billion in funds from Indians living overseas, far more than the World Bank's estimate of $30 billion

Upcoming Foreign Banks in India

RBS (Royal Bank Of Scotland Group).

Industrial & Commercial Bank of China.

Banking Industry Vision Report 2010

Qualitative Growth Consolidation Risk and Reward Technology

Social Banking
Regulation

Problems and Challenges to the Banking Industry

Lack of product expertise Lack of distribution expertise Limited use of technology Inefficient capital allocation Competition in market
Post office Insurance Foreign Banks

Possible Suggestions to Overcome Problems

Technological Advancement

Rural Banking
Improving Risk Management

CONCLUSION OF BANKING INDUSTRY

Indian INSURANCE INDUSTRY Overview

Introduction of Insurance
Insurance may be described as a social device to reduce or eliminate risk of life and property. Under the plan of insurance, a large number of people associate themselves by sharing risk, attached to individual.

The risk, which can be insured against include fire, the peril of sea, death, incident, & burglary. Any risk contingent upon these may be insured against at a premium commensurate with the risk involved.

Insurance is actually a contract between 2 parties whereby one party called insurer undertakes in exchange for a fixed sum called premium to pay the other party happening of a certain event.
.

Insurance is a contract whereby, in return for the payment of premium by the insured, the insurers pay the financial losses suffered by the insured as a result of the occurrence of unforeseen events. With the help of Insurance, large number of people exposed to a similar risk make contributions to a common fund out of which the losses suffered by the unfortunate few, due to accidental events, are made good.

History of the Insurance Sector

Milestones of the life insurance business in India are:
1912 1928 1938 1956

General Insurance Business

Milestones of the General Insurance Business are:
1907 1957 1968 1972

Major reforms
In 1993, Malhotra Committee was set up. In 1994, the committee submitted a report suggesting

recommendation like Structure Government stake should be brought down to 50%

Competition Private companies should have minimum rs.1 billion paid up capital Foreign companies should be allowed to enter

Major reforms
Regulatory body

An insurance regulatory body should be set up.

Customer service

LIC should pay interest on delay in payment Computerization of operation to be carried out in industry.

Insurance Regulatory and Development Authority (IRDA)

Insurance Regulatory and Development Authority

Act,1999 IRDA was established on 19th April, 2000 Operating condition

Should follow Companies Act ,1956 Equity share holdings of foreign co. should not exceed

26% Companies sole purpose should be insurance business Minimum paid capital for life and general insurance is Rs. 100 crores and that of reinsurance is Rs.200 Crores

Present scenario of the industry

Market size went up to US$ 47.89 billon in 2007, from

US$ 21.11 billon in 2000. Market increased from just 1 company in last decade to 22 life insurance companies. Enter into Semi-urban and Rural market. Country's insurance sector is likely to experience 17% growth this year. 78% people aware of insurance, out of which only 24% own a policy.

Global companies
Companies Base country Type of insurer

QBE Holdings (AAP) Pty Limited

Australia

General Insurance

Aetna CIGNA Bupa

US US UK

Health insurers Health insurers Health insurers

Ace

US

Life and Non-Life sectors

Functions of insurance
Primary Functions Secondary Functions Other Functions

Primary Functions
Provide Protection Collective Bearing of Risks Assessment of Risk

Secondary Function
Prevention of losses Small Capital to Cover Larger Risk Development of Larger Industries

Other Functions
Means of Savings And Investment Source of Earning Foreign Exchange Risk Free Trade

Recent Trends & Opportunities in the insurance industry

Opportunities Rural-Urban Mix

CONCLUSION
Insurance Sector Futuristic Growth ASSOCHAM has started that Indias Insurance Sector is likely to reach US $ 46.25 billion by 2010

Thank you