DEVELOPMENT FINANCIAL INSTITUTION IN INDIA

Preeti sharma

MEANING OF DEVELOPMENT BANKS

Development banks are the financial agencies that provide medium and long term financial assistance and act as catalytic agents in promoting balanced development of the country

Industrial finance is a very complicated problem. It is of vital importance as development of any country depends on industrial development of that country s economy. Why there is need of finance 1) Long term 2) Medium term 3) Short term

CONTINUE.
Long term capital is also known as block capital or fixed capital. it is needed to acquire -fixed and permanent assets Medium term capital is required for repairs, replacements, maintenance of machines and building etc. Short term capital is needed for purchase of raw material , and to meet day to day expenses

TYPES OF FINANCIAL INSTITUTIONS IN INDIA

Term lending Refinance institutions Investment institutions State level institutions

TERM LENDING
IFCI (Idustrial Finance Corporation Of India IDBI (Indutrial Development Bank Of India) ICICI (Industrial Credit And Investment Corporation Of India) EXIM (Export Import Of India) TFCI (Tourism Finance Corporation In India)

REFINANCE INSTITUIONS
NABARD ( National Bank For Agriculture And Rural Development) SIDBI (Small Industries Development bank Of India) NHB (National Housing Bank)

IFCI (INDUSTRIAL FINANCE CORPORATION OF INDIA)

It was established in 1948 First development bank of India Objective was to make medium and long term credits more readily available Management - BOD total 12 members(4 by idbi,2 by center govt, 6 by shareholders) - -full time chairperson

CONTINUE.
Resources of IFCI -ownership capital -Issue of shares and bonds -borrowing from RBI,IDBI AND CENTER GOVT -accepting deposits from public, state govt and local authorities

FINANCIAL ASSISTANCE BY IFCI/IDBI

Purpose New projects sanction(crores) IDBI 15919.6 67498

Expansion /acquisition Rehabilitation Modernization Working capital

6649.2 115.7 5459.7 837

50627 1415 12976 5138

IDBI (INDUSTRIAL DEVE. BANK OF INDIA)

Set up in 1964 It was fully owned subsidiary of RBI but in 1976 delinked from RBI and made as autonomous body of GOI H.O in Mumbai 11 branch offices It is managed by a chairman and MD appointed by central govt, a deputy governor nominated of RBI, 20 other directors.

With effect from 1 oct,2004 it has renamed as IDBIL. It has been accepted as a deemed banking co under banking regulation act. The govt holds the majority (58.47%) shares of IDBI LTD. During last 40 years IDBI has given a qualitative dimension to the process of industrial development of the country.

ABOUT ICICI
Established in 1955 As a public ltd co, at the initiative of world bank Authorized capital of 60 crores and issued capital 22 crores The objectives of icici are to encourage establishment of new industries, to help in expansion and modernization, technical and managerial aid to increase production and employment.

CONTINUE
In October 2001 .BOD Approved ICICI LTD AND ICICI BANK LTD. With effect from MAY 2002 IT IS SIMPLY ICICI bank . ICICI is now the largest bank with total assets of more than 3000 billions More than 700 branches and over 2200 ATM spread all over the country It mainly deals in Retail banking, wholesale banking, project finance, international business and special assets mgt

CONTINUE

Icici is known for its many firsts. -it was first Indian co to listed in New york stock exchange. Foreign financial investor own around 38% shares . Technology, strategy, low cost branches innovations are key reasons of icici success. They are the first to introduce mobile banking, on line financial information, portals to allow accounts and information on line. It was the first to introduce e-commerce. It has the largest no of call centers.

EXIM
Established on1st JAN,1982. Authorized capital 1000 crores and paid up is 650 crores. Exim bank came into existence when international finance division of idbi was transferred to exim bank in 1982. Exim started its working from march 1982 The issued capital is wholly subscribed by center govt

CONTINUE

The main objective of exim is to provide financial assistance to exporters and importers. It has to coordinate the working of those institutions which can promote international trade. Management is MD+17 other directors representing govt,RBI,ECGC,public sector banks Resources of EXIM -GOI -RBI -any organization approved by GOI TYPES OF ASSISTANCE -fund based -non fund based

ASSITANCE BY EXIM

Fund based Pre shipment credit Foreign currency Post shipment credit Deemed exports Loans to commercial banks for bills discounting Finance for consultancy and technology

Non fund based Guarantees

REFINANCING INSTITUITIONS
Are

those which do not give finance directly but they create such structure by which the funds are allocated up to the minimum level.

NABARD-NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT

Started functioning from 1july 1982 Set up with an initial capital of 100 crores, now it is 2000 crores fully subscribed by GOI AND RBI. H.O IN Mumbai, with 28 regional and 391 district offices It is an apex orga for policies, planning and operations of agriculture ,ssi ,handicraft and village industries It mainly deals in three types of functions -credit ,developmental ,regulatory functions

CONTINUE

Funds created by NABARD -rural infrastructural deve fund 28749 crores -R&d fund -Soft loan assistance fund -Credit and financial services fund

SIDBI
Set up in oct 1989 Wholly owned subsidiary of IDBI It is the principal financial institution for promotion ,financing and deve of small scale industries In sep 2000 IDBI transferred 51% in favor of banks and other institutions in the first phase.

NHB-NATIONAL HOUSING BANK

Set up in July 1988 A principal agency to promote housing finance Wholly owned subsidiary of RBI Registered With capital of 350 crore which can be increased to 2000 crores. The board is authorized to issue increased capital to RBI, center govt.

INVESTMENT INSTITUITIONS
Are

those who invest the money collected in further securities and investments outside .LIKE LIC GIC UTI

LIC
Set up in 1956 Lic was formed by nationalizing 245 life insurance companies The main aim was to - spread insurance - Mobilize savings - Investing funds - Act as trustees

CONTINUE..
-promoting a sense of pride and job satisfaction among agents and employees Diversification by LIC -LIC HOUSING FINANCE -LIC MUTUAL FUNDS -Jeevan bima sahyog assets mgt co(JBSAMC) -LIC International EC

THANK YOU