HISTORY OF BANKING
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INTRODUCTION A bank is a financial intermediary that intermediary that creates credit by lending money to a borrower, thereby creating a corresponding deposit on the bank's bank's balanc balancee sheet. sheet. Lending activities can be performed either directly or indirectly through capital markets.. Due to thei markets theirr impo import rtan ance ce in the the fin financ ancial ial sys system tem and and infl influe uenc ncee on national economies economies,, banks are highly regulated in regulated in most countries. Most nations have institutionalized a system known as fractional reserve banking under banking under which banks hold liuid assets eual to only a portion of their current liabilities. !n addition to othe otherr regul regulati ation onss inte intend nded ed to ensu ensure re liu liuid idity ity,, bank bankss are gene general rally ly sub" sub"ect ect to minimum capital reuirements based reuirements based on an international international set of capital standards, standards, known as the #asel Accords. Accords. #anks act as payment agents by conducting checking or current accounts for accounts for customers, paying cheues cheues drawn drawn by customers on the bank, and collecting cheues deposited to customers' current accounts. #anks also enable customer payments via other
paym ayment ent
metho thods
transfers or telegraphic
such
as Au Auto toma mate ted d
transfer , )*+- )*+-,,
$lear $l earin ing g
%ous %o usee &A$%, (ire
and automated
teller
machines&A+Ms.#anks machines &A+Ms.#anks borrow money by accepting funds deposited on current accou account nts, s, by accep accepti ting ng term dep deposi osits ts,, and and by issu issuin ing g debt ebt secu securi riti ties es such such as banknotes as banknotes and and bonds bonds.. #anks lend money by making advances to customers on current accounts, by making installment loans, loans, and by investing in marketable debt securities and other forms of money lending. #anks provide different payment services, and a bank account is considered indispensable by most businesses and individuals. /on0banks that provide payment services such as remittance companies are normally not considered as an adeuate substitute for a bank account. #anks can create new money when they make a loan. /ew loans throughout the banking system generate new deposits elsewhere in the system. +he money supply is usually increased by the act of lending, and reduced when loans are repaid faster than new ones are generated. generated. +here was an increase in the money supply, largely caused by much more bank lending, which served to push up property prices and increase private debt.
2
INTRODUCTION A bank is a financial intermediary that intermediary that creates credit by lending money to a borrower, thereby creating a corresponding deposit on the bank's bank's balanc balancee sheet. sheet. Lending activities can be performed either directly or indirectly through capital markets.. Due to thei markets theirr impo import rtan ance ce in the the fin financ ancial ial sys system tem and and infl influe uenc ncee on national economies economies,, banks are highly regulated in regulated in most countries. Most nations have institutionalized a system known as fractional reserve banking under banking under which banks hold liuid assets eual to only a portion of their current liabilities. !n addition to othe otherr regul regulati ation onss inte intend nded ed to ensu ensure re liu liuid idity ity,, bank bankss are gene general rally ly sub" sub"ect ect to minimum capital reuirements based reuirements based on an international international set of capital standards, standards, known as the #asel Accords. Accords. #anks act as payment agents by conducting checking or current accounts for accounts for customers, paying cheues cheues drawn drawn by customers on the bank, and collecting cheues deposited to customers' current accounts. #anks also enable customer payments via other
paym ayment ent
metho thods
transfers or telegraphic
such
as Au Auto toma mate ted d
transfer , )*+- )*+-,,
$lear $l earin ing g
%ous %o usee &A$%, (ire
and automated
teller
machines&A+Ms.#anks machines &A+Ms.#anks borrow money by accepting funds deposited on current accou account nts, s, by accep accepti ting ng term dep deposi osits ts,, and and by issu issuin ing g debt ebt secu securi riti ties es such such as banknotes as banknotes and and bonds bonds.. #anks lend money by making advances to customers on current accounts, by making installment loans, loans, and by investing in marketable debt securities and other forms of money lending. #anks provide different payment services, and a bank account is considered indispensable by most businesses and individuals. /on0banks that provide payment services such as remittance companies are normally not considered as an adeuate substitute for a bank account. #anks can create new money when they make a loan. /ew loans throughout the banking system generate new deposits elsewhere in the system. +he money supply is usually increased by the act of lending, and reduced when loans are repaid faster than new ones are generated. generated. +here was an increase in the money supply, largely caused by much more bank lending, which served to push up property prices and increase private debt.
2
!f all the banks increase their lending together, then they can e1pect new deposits to return to them and the amount of money in the economy will increase. )1cessive or risky lending can cause borrowers to default, the banks then become more cautious, so there is less lending and therefore less money so that the economy can go from boom to bust.
ORIGIN OF BANKING #anking in !ndia in the modern sense originated in the last decades of the 23th 23th century century.. Among Among the first first banks banks were the #ank #ank of %indu %industan stan,, which which was established in 2445 and liuidated in 23670869 and the :eneral #ank of !ndia, established in 243; but failed in 2472. *or many years the presidency banks had acted as uasi0central banks, as did their successors, until the
. 278> . !n 27;7 the !ndian government nationalized 2> ma"or private banks. !n 2735, ; more private banks were nationalized. +hese nationalized banks are the ma"ority of lenders in the !ndian economy. economy. +hey dominate the banking sector because of their large size and widespread networks. +he !ndian banking sector is broadly classified into schedu scheduled led bank bankss and non0sch non0schedu eduled led banks. banks. +he +he schedu scheduled led banks banks are those those which are included under the 6nd chedule of the .+he scheduled banks are further classified into? nationalized banks9 tate #ank of !ndia and !ndia and its associates9 associates9 7. 27>7. :enerally banking in !ndia is fairly mature in terms of supply, product range and reach0even though reach in rural !ndia and to the poor still remains a challenge.
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EARLY PHASE (1786 TO 1935) #anking in !ndia originated in last decades of the 23th century. +he first banks were the general bank of !ndia, which started in 243;, and the #ank of %industan, %industan, both of which are now defunct. defunct. +he oldest bank in e1istence e1istence in !ndia is the state bank of !ndia, which originated in the #ank of $alcutta in @une 235;, which almost immediately became the #ank of #engal. +his was one of three presidency bank, the other two being the bank of #ombay and the #ank of Madras, all three of which were established under characters from the #ritish east !ndia company. *or many years the presidency bank acted as uasi0central banks, as did their successors. +he )ast !ndia company established bank of #engal, bank of #ombay and bank of madras as independent units and called it presidency banks. +he three banks merged in 276= to form the imperial bank of !ndia, which, upon !ndia's independence, became the state bank of !ndia. *oreign banks too started to arrive, particularly in $alcutta, in the 23;5s. +he comptoired' escompte de aris opened a branch in $alcutta in 23;5 and another in #ombay in 23;69 branches in madras and ondicherry, then a *rench colony, followed. %#$ established itself in #engal in 23;5. $alcutta was the most active trading port in !ndia, mainly due to the trade of the trade of #ritish empire, and so became a banking center. !ndian merchants in $alcutta established the union bank in 2387, but it failed in 23>3 because of the economic crisis of 23>30>7. +he Allahabad bank, established in 23;= and still functioning today, is the oldest "oint stock bank in !ndia.
JOINT STOCK BANKS American civil war played a ma"or role in the development of banking in !ndia. +he ne1t big thin gun folded in the early phase of banking was formation of "oint stock companies, with limited liability. +he American civil war cut off the supply of American cotton to )ngland caused an unprecedented boom in !ndia's cotton trade with )ngland. +he first "oint stock bank was bank of upper !ndia, which was established in 23;8, and which survived until 2728, when it fai led, with some of its assets and liabilities being transferred to the alliance bank of himla. +he first
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entirely !ndian "oint stock bank was the -udh commercial bank, established in 2332 in faizabad. !t failed in 27=3. +he ne1t was the un"ab national bank, established in Lahore in 237=, which has survived to present and is now one of the largest banks in !ndia.
STABILITY & GROTH Around the turn of the 65th $entury, the !ndian economy was passing through a relative period of stability. Around five decades had elapsed since the !ndian Mutiny, and the social, industrial and other infrastructure had. improved. !ndians had established small banks, most of which served particular ethnic and religious communities. +he presidency banks dominated banking in !ndia but there were also some e1change banks and a number of !ndian "oint stock banks. All these banks operated in different segments of the economy. +he e1change banks, mostly owned by )uropeans, concentrated on financing foreign trade. !ndian "oint stock banks were generally undercapitalized and lacked the e1perience and maturity to compete with the presidency and e1change banks. +his segmentation let Lord $urzon to observe,
SADESHI !O"E!ENT +he wadeshi movement inspired local businessmen and political figures to found banks of and for the !ndian community. A number of banks established then have survived to the present such as #ank of !ndia, $orporation #ank, !ndian #ank, #ank of #aroda, $anara #ank and $entral #ank of !ndia. Ammembal ubba
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+he fervor of wadeshi movement lead to establishing of many private banks in Dakshina Bannadaand Cdupi district which were unified earlier and known by the name outh $anara &outh Banara district. *our nationalized banks started in this district and also a leading private sector bank. %ence, undivided Dakshina Bannada district is known as $radle of !ndian #anking. !. !!. !!!. !. . !. !!. !!!. !E. E. E!.
#ank of #engal 2357 #ank of #ombay 23>5 #ank of Madras 23>8 Allahabad #ank 23;= un"ab /ational #ank Ltd 237> $anara #ank 275; !ndian #ank 2754 #ank of #aroda 2753 $entral #ank of !ndia 2722 #ank of Mysore 2728 Cnion #ank of !ndia 2766.
PRE NATIONALI#ATION PHASE (1935 TO 1969) -rganized banking in !ndia is more than two centuries old. Cntil 278= all, the banks were in private sector and were set up by individuals andFor industrial houses, which collected deposits from individuals and used them for their own purposes. !n the absence of any regulatory framework, these private owners of banks were at liberty to use the funds in any manner, they deemed appropriate and resultantly, the bank failures were freuent. *or many years the residency banks acted as uasi0central banks, as did their successors. #ank of #engal, #ank of #ombay and #ank of Madras merged in 276= to form the !mperial #ank of !ndia, which, upon !ndia's independence, became the tate #ank of !ndia. )ven though consolidation in banking was building trust among the investors but a central regulatory, authority was much needed. #ritish :overnment in !ndia passed many trade and commerce laws but acted little on regulating the banking industry.
RESER"E BANK OF INDIA Another breakthrough happened in this phase, which was
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$ommission on !ndian $urrency and *inance also known as the %ilton0Goung $ommission. +he commission submitted its report in the year 276;, though the bank was not set up for nine years. issued a notification and on @anuary 2>, 278=, the <#! came into e1istence, though it was formally inaugurated only on April 2, 278=.
!AIN FUNCTIONS OF RBI 4. After the partition of !ndia, the 3 when the tate #ank of akistan commenced operations.
POST NATIONALI#ATION PHASE (1969 TO 199$) ! think nationalization 4 of banks in !ndia was an important phenomenon. -n @uly 27, 27;7 0 the erstwhile government of !ndia nationalized 2> ma"or private banks. /ationalization of bank in !ndia was not new or happening first time. *rom 27== to 27;5, tate #ank of !ndia and other seven subsidiaries were nationalized under the #! Act of 27==.
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$entral #ank of !ndia #ank of Maharashtra Dena #ank un"ab /ational #ank $anara #ank !ndian #ank !ndian -verseas #ank !t was not a step taken at random or because of the whims of the leadership
of the time, but reflected a process of struggle and political change which had made this an important demand of the people. /ationalization took place in two phases, with a first round in 27;7 covering 2> banks followed by another in 2735 covering seven banks. $urrently there are 64 nationalized commercial banks.
HAT IS NATIONALI#ATION /ationalization, also spelled nationalization, is the act of taking an industry or assets into the public ownership of a national government or state. /ationalization usually refers to private assets, but may also mean assets owned by lower levels of government, such as municipalities, being state operated or owned by the state. +he opposite of nationalization is usually privatization or de0nationalization. +he motives for nationalization are political as well as economic.
REASONS FOR NATIONALI#ATION +he need for the nationalization was felt mainly because private commercial banks were not fulfilling the social and developmental goals of banking, which are so essential for any industrializing country. Despite the enactment' of the #anking 7 and the nationalization of the largest bank, the tate #ank of !ndia, in 27==, the e1pansion of commercial banking had largely e1cluded rural areas and small0scale borrowers +he developmental goals of financial intermediation were not being achieved other than for some favored large industries and established business houses. (hereas industry's share in credit disbursed by commercial banks almost doubled between 27=2 and 27;3, from 8> percent to ;3 per cent, agriculture received less than 6 per cent of total credit.
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+he stated purpose of bank nationalization was to ensure that credit allocation occur in accordance with plan priorities.
AD"ANTAGES OF NATIONALI#ATION /ationalized banks had to provide 23 per cent of their net credit to the agricultural sectors. +his was targeted to reduce the hold of moneylenders and make more funds available for agricultural development. +his has substantially helped farmers. +he reach of banking widened9 the entry barriers that e1isted for customers to bank, social economic and political were lowered. +his resulted in a massive uantitative e1pansion of the bank customer base as well as in the nature of services provided. Absence of concern for profitability and targeting made banks to e1pand rapidly in unbanked areas thereby the entire country was linked to banking activity. )nhanced bank credit to the farm sector became instrumental for the success of green revolution and the increase of aggregate food grain production in north and northwest !ndia in the 2745s and in the eastern region in the 2735s. !ncrease in e1ports by small0scale manufacturers over the 2735s and 2775s, such that they accounted for around two0third of the total value of all e1ports, was strongly related to access to bank credit provided by priority sector norms. $ollection of saving? rivate banks were not that good in attracting more saving. %owever, with nationalization banks were now backed by :overnment of !ndia, which. tremendously improved their credibility. +his helped in more deposits, more savings hence more supply of money.
9
DISAD"ANTAGES OF NATIONALI#ATION tate intervention to some e1tent distorted the banking sector. +he domination of the tate has had a negative effect on the contribution of the banking sector as a whole to the economy. Absence of profitability, non0realization of its potential as a business and the deterioration in service has all affected citizens. +he intervention by the tate and e1cessive domination and intervention by the bureaucracy and polity into the functioning of banks has led to deterioration on economic efficiency, which runs counter to the principles of a good :overnment. Low rofitability? (hen the ownership is in public sector, the employs do not work for profit and do not their performance and efficiency of the employs remains poor. $ompetition is necessary for development and increasing the production. /ationalization has decreased the spirit of competition. +his phase of !ndian banking not so happening for entry of new banks. Cndoubtedly, it was a phase of e1pansion, consolidation and increment in many ways. +he banking sector grew at a phenomenal rate, fruits of nationalization were evident, and common person was now banking with great trust. /ational #ank for Agricultural and
H
*inancial
under ick $ompanies &pecial rovisions Act 273= and started its operations wed May 2=, 2734. !t is meant to deal with sick companies or potential sick companies as defined under the Act. #!*<, based on a reference by the concerned sick company, takes a decision whether the company should be rehabilitated or wound up.
!ODERN PHASE FRO! 1991 TILL DATE +his is the phase of /ew :eneration tech0savvy banks. +his phase can be called as +he
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SCHEDULED BANKS cheduled #anks in !ndia constitute those banks, which have been included in the econd chedule of .
<#!
in turn
includes only those banks in this schedule which satisfy the criteria laid down vide section >6 &; &a of the Act. As on 85th @une 2777, there were 855 scheduled banks in !ndia having a total network of ;>,723 branches. +he scheduled commercial banks in !ndia comprise of tate bank of !ndia and its associates &3, nationalized banks &27, foreign banks &>=, private sector banks &86, co0operative banks and regional rural banks.
NON%SCHEDULE BANKS /on0scheduled bank in !ndia means a banking company as defined in clause &c of section = of the #anking 7 &25 of 27>7, which is not a scheduled bank. #anks in !ndia can also be classified in a different way.
ublic ector #anks rivate ector #anks *oreign #anks
with the previous one. ublic ector, rivate ector and *oreign #anks fall the category of scheduled banks. $urrently, !ndia has 33 scheduled commercial banks &$#s 0 64 public sector banks &that is with the :overnment of !ndia holding a stake, 82 private banks &these do not have government stake9 they may be publicly listed and traded on stock e1changes and 83 foreign banks. +hey have a combined network of over =8,555 branches and 24,555 A+Ms. According to are port by !$
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PROFILE OF THE BANK
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INDIAN O"ERSEAS BANK !ndian
-verseas
#ank &!-#
is
a
ma"or public
sector bank
based
in $hennai &Madras, with about 8455 domestic branches, including 22=5 branches in +amil /adu, 8 e1tension counters, and eight branches and offices overseas as of 85 eptember 652>. !ndian -verseas #ank has an !- certified in0house !nformation +echnology department, which has developed the software that its branches use to provide online banking to customers9 the bank has achieved 255I networking status as well as 255I $# status for its branches. !-# also has a network of about 8855 A+Ms all over !ndia. !-# has branches in ingapore, %ong Bong, $olombo, eoul, and #angkok. !t has representative offices in :uangzhou, ietnam, and Dubai. !-# also is part0 owner of a "oint0venture bank in Malaysia. +he net profit for the uarter ended 85 @une 652> stood at !/< 646 $rores. +he #usiness touched !/< >,65,487 $rores &GoG :rowth 3.2;I for the uarter ended 85 eptember 652>. Deposits stood at !/< 6,87,668 $rores &GoG :rowth 26.>4I, $AA stood at 68.4;I, Advances stood at !/< 2,32,=2= $rores &GoG :rowth 6.7;I -perating rofit for J6 2>02= is !/< 467 $rores.
HISTORY OF IOB -n 25th *ebruary 2784, +hiru.M. $t. M. $hidambaram $hettyar established the !ndian -verseas #ank &!-# in Madras. !t was created to encourage overseas banking and foreign e1change operations. !-# started up simultaneously at three branches, one each in Baraikudi, Madras, and 2. +he bank served the /attukottai $hettiars, who were a mercantile class that at the time had spread from $hettinad in +amil /adu state to $eylon &ri Lanka, #urma &Myanmar, Malaya, ingapore, @ava, umatra, and aigon. As a result, from the beginning !-# specialised in foreign e1change and overseas banking. Due to the war, !-# lost its branches in 6 under @apanese supervision.
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!n 27>= or 27>; !-# opened a branch in $olombo. !n 27>4, !-# opened a branch in #angkok. +hen !-# added a branch each in !poh, Blang, and Malacca, all in Malaya. ome years later, in 27==, !-# opened its first branch in %ong Bong. -thers would follow. !/ 27;8 the revolutionary government in #urma nationalized !ndian -verseas #ank's branches in . !n the 27;5s, the banking sector in !ndia was consolidating through the merger of weak private sector banks with stronger ones.
IOB ACUIRED A NU!BER OF LOCAL BANKS • • •
• • •
$oimbatore tandard #ank &ac. 27;89 one branch at Madras, /an"innad #ank &or /an"anad #ank, $oimbatore asunthara #ank &or $oimbatore asundara #ank9 est. @une 276>9 %ead office and three branches9 ac. 27;>, Bulitalai #ank &est. 27889 ac. 27;>9 si1 branches, rinivasa erumal #ank &est. /ovember 278= at $oimbatore9 ac. 27;;, &riFLord enkateswara #ank &est. @une 2782 as alem hevapet ri enkateswara #ank9 ac. 27;49 two branches in alem, +amil /adu. +hen in 27;7 the :overnment of !ndia nationalized !-#. At one point,
probably before nationalisation, !-# had twenty of its eighty branches located overseas. %owever, Malaysian law forbade foreign government ownership of banks in Malaysia. After nationalisation !ndian -verseas #ank, like all the nationalized banks, turned inward, emphasizing the opening of branches in rural !ndia. !n
2748,
!-#, !ndian #ank and Cnited $ommercial #ank established Cnited Asian #ank #ehead in Malaysia. &!ndian #ank had been operating in Malaysia since 27>2 and Cnited $ommercial #ank had been operating there since 27>3. +he banks set up Cnited Asian to comply with the #anking Law in Malaysia, which prohibited foreign government banks from operating in the country. )ach contributed their operations in Malaysia to the new "oint0venture bank, with each of the three parent banks owning a third of the shares.
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At the time, !ndian #ank had three branches, and !ndian -verseas #ank and Cnited $ommercial #ank had eight between them. Also, !-# and si1 !ndian private banks established #harat -verseas #ank as a $hennai0based private bank to take over !-#'s #angkok branch. !n 2744 !-# opened a branch in eoul. it also opened a branch in +sim ha +sui, Bowloon, %ong Bong. +wo years later, !-# opened a foreign currency banking unit in $olombo, ri Lanka. !n 2738 ethnic sectarian violence in the form of anti0+amil riots resulted in the burning of !-#'s branch in $olombo. !ndian #ank , which may have had stronger ties to the inhalese population, escaped unscathed. !n 2733K37, !-# acuired #ank of +amil /adu, and its 77 branches, in a rescue. #ank of +amil /adu &or #ank of +amilnadu, had been established in 2758 in +irunelveli as the outh !ndia #ank. !n 2776 #ank of $ommerce &#-$, a Malaysian bank, acuired Cnited Asian #ank &CA#. !n 6555, !-# engaged in an initial public offering &!- that brought the government's share in the bank's euity down to 4=I. !n 6552 !-# acuired the Mumbai0based Adarsha @anata ahakari #ank, which gave it a branch in Mumbai. +hen in 6557 !-# took over hree uvarna ahakari #ank, which was founded in 27;7 and had its head office in une. hree uvarna ahakari #ank had been in administration since 655;. !t had nine branches in une, two in Mumbai and one in hirpur . +he total employee strength was estimated to be little over 255. !-# opened an e1tension counter at /ew Bathiresan +emple comple1, #ambalapitiya, $eylon, on 67 August 6558.!n 655= !-# opened a representative office in :uangzhou, $hina. +he ne1t year !-# opened another representative office, this time in Buala Lumpur. !n the new millennium, international e1pansion picked up once again. !n 6554, !-# took over #harat -verseas #ank . +hree years later, Malaysia awarded a commercial banking license to a locally incorporated bank to be "ointly owned by #ank of #aroda, !ndian -verseas #ank and Andhra #ank .
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+he new bank, !ndia !nternational #ank &Malaysia, commenced operations in 6526 in Buala Lumpur, which has a large population of !ndians. Andhra #ank holds a 6=I stake in the "oint0venture9 #ank of #aroda owns >5I, and !-# the remaining 8=I.!-# opened an -ffshore #anking Cnit in $olombo, ri Lanka, on 82 August 6528. +he bank also upgraded its e1isting )1tension $ounter at #ambalapitiya into a full0fledged branch.
IOB !ILESTONES
27=4 0 #ank established its own training center 27;> 0 !nauguration of !-#s %ead -ffice in Mount 0 -fficial Language Department established in 274> 273> 0 2555th branch opened 2772 0 #ank moved its taff $ollege premises to an own spacious learning zone
at Boyambedu 277; 0 #anks profit reached !/< 255 cr. for the first time i.e. CD2;.;7Mn
2CDN
+he first public sector bank to introduce anywhere banking at its 267 branches in the four metros, is e1tending the connectivity to another 255 branches in %yderabad, #angalore, Ahmedabad and Ludhiana +he first public sector bank in the country to introduce mobile banking services using (ireless Application rotocol &(A. 655= 0 Launched Debit $ard 655; 0 Launched !A $ard, 8.=655O #harat -verseas #ank Ltd. (as merged with !-# and *irst -ff site A+M at Bamatchi %ospital, $hennai 6557 0 255I $#
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6525 0 6555th #ranch 0Gamuna ihar, /ew Delhi0opened 6522026 0 /o. of #ranches in +amil /adu reached 2555, and !-# celebrated latinum @ubilee 6526028. As on 82.8.6528, total deposits reached !/< 656,28= cr. &CD 84,68;Mn. 2CD N.63=5O As on 82.8.6528, +otal Advances reached !/< 2;>,8;;cr. &CD85,643 M/. As on 82.8.6528, +otal #usiness Mi1 is at !/< 8;;,=52cr. &CD ;4,=2>Mn., +otal /o. of #ranches 6753 652>0 #ank has surpassed the landmark of 8555 A+Ms as on 82.54.652> 0 +irumalaipatti #ranch 652= 0 !-# launched new Android Mobile #anking Application. @oint entures F +ie0Cps !-# entered into /on0Life !nsurance #usiness with Cniversal ompo :eneral !nsurance &C:! $ompany Limited with euity participation of 27I along with Allahabad #ank, Barnataka #ank and Dabur !nvestments. !ndian -verseas #ank &!-# has tie up with Apollo Munich %ealth !nsurance to provide specialized health and personal accident products to its customers
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PROFILE OF THE BRANCH
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/ame of the #ank?
!/D!A/ -)<)A #A/B
/ame of the #ranch?
elachery0+aramani link road
#ranch $ode?
6328
Manager name?
Mr. <. #ALAB
Assistant manager?
Mrs. Bavitha anthanagopal
enior clerk?
Mr. athya udhakar. $.
$lerk F$hief $ashier?
Mr. .
$lerk?
Mrs. :. idya
/o. of. taffs?
5=
Address?
6F2;, Bennedy treet, +hanthai eriyar /agar, elachery0+aramani link road
$ity?
$hennai
tate?
+amil /adu
)0mail?
iob6328Piob.in9
Micr $ode?
;55565654
!*$ $ode?
!-#A5556328
wift $ode?
!-#A!/D#552
(ebsite?
www.iob.in
ACCOUNT DETAILS +-+AL /-. -* A!/: AF$ K ;56= +-+AL /-. -* $C<<)/+ A$$-C/+ 0233
DEPOSIT DETAILS AS ON 31'1'$15 +-+AL D)-!+? .42
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SER"ICE RENDERED BY THE BRANCH TYPES OF ACCOUNTS A deposit account is a savings account, current account, loan, deposit, or other type of bank account, at a banking institution that allows money to be deposited and withdrawn by the account holder. +hese transactions are recorded on the bank's books, and the resulting balance is recorded as a liability for the bank and represents the amount owed by the bank to the customer. ome banks charge a fee for this service, while others may pay the customer interest on the funds deposited.
SA"ING BANK ACCOUNT avings #ank Deposit chemes 0 C name it we have it !ndian -verseas #ank provides various avings #ank Deposit schemes meant for people belonging to all sections of the society. +he #ank stays committed to society to inculcate savings habit among the people while allowing them to use their funds as per their convenience.
O* S+,-./0 B+. D240- S220 -.:2 I avings #ank /o *rills Account0 >I
!-# avings #ank :old ! !f the uarterly average balance is between
Q
balance e1ceeding
!-# savings #ank :old !! !f the uarterly average balance is between
20
#ank account with us and en"oy hassle free #anking. (ith our $ore #anking solution, you have the fle1ibility to operate your account from any of the 6;55R $ore #anking #ranches all over !ndia.
CURRENT ACCOUNT C**2. D240- S220 $urrent Deposit chemes are cheaue operated accounts primarily meant for businessmen, firms, companies, public enterprises etc. that have numerous daily banking transactions. !t is the name given to a transactional account in the Cnited Bingdom and countries with a CB banking heritage, offering various fle1ible payment methods to allow customers to distribute money directly to others. Most current accounts come with a cheaue book and offer the facility to arrange standing orders, direct debits and payment via a debit card. $urrent accounts may also allow borrowing via an overdraft facility.
FI;ED DEPOSIT
T2 <2.2=-0 4= + F->2: D240- +he option to withdraw the deposit at any time before maturity without any difficulty Gou can avail loans up to 3=I of the principal ariable deposit periods ranging from ; months to 265 months Gou get interest once in ; months.
RECURRING DEPOSIT
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T2 <2.2=-0 4= + *2**-./ D240-
"ARDHAN DEPOSIT "+*:+.? % D240- 4= S2.-4* C-[email protected] 4 -0 + 02.-4* --@2. Any individual who has completed ;5 years of age is treated as enior $itizen for the purpose of opening account under ardhan scheme.
H4 4 ,2*-= 2 +/2
Age can be verified by calling for anyone of the following document. ension ayment -rder. chool leaving certificate. oters identity card L!$ policy where age is admitted. #irth certificate issued by competent authority. assport. Driving License At the time of renewal of a ardhan deposit branches need not insist on
producing the documents in proof of age again. LOANS
Loans can come from individuals financial, corporations, institutions and governments. +hey are a way to grow the overall money supply in an economy as well as open up competition, introduce new products and e1pand business operations. Loans are a primary source of revenue for many financial institutions such as banks, as well as some retailers through the use of credit facilities. TYPES OF LOANS
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HOUSING LOANS
E-/-<--
:roups of individuals Members of $o0operative ocieties !ndividuals not more than == years of age Loan must be liuidated before attaining ;= Gears of age.
F4* 0++*-2: -.:-,-:+
A permanent "ob with a minimum of6 or 8 years service F4* 02=%242: *4=200-4.+
A minimum period of three years of activity in the related field "+2 A::--4.
(e are e1tending ehicle Loan to our e1isting %ousing Loan #orrowers &Minimum -ne Gear
+o buy, build or renovate flatFhouse. +. 4= 4+.
A ma1imum of 75I of the cost of the houseFflat or
+he minimum margin is 25I of the estimated cost &including the cost of the land for new as well as old houses flats. R2+2.
23
A ma1imum holiday period of 23 months from the date of first disbursement or completion of construction 0 whichever is earlier. !n case the house is purchased, the holiday period is 8 months. S2*-
*irst mortgage on the property to be bought, constructed or renovated. +he land should be in the applicant's name or "ointly with spouse who should be a co0obligant hould have a clear and marketable title over the property should have comprehensive insurance on the property for adeuate value Additional security in the form of /$, L!$, Cnits of C+! will also be accepted P*4200-./ +*/20
A flat rate of 5.=3I of the loan amount0 ma1imum of
An application form. alary certificate as a proof of income &for employed individuals roof of income &for professionals, business people etc. Agreement for sale of house flat roof of membership &for co0operative societies etc. roof for e1perience in the line of activity &for professionals, business people etc. )stimates for $onstructionFaluation
EDUCATIONAL LOANS% "-:+ J4-
24
E-/-<--
hould be an !ndian /ational hould have secured admission to professionalFtechnical courses in !ndia or abroad P*402
Loan is made available for :raduationFost graduationFDiplomaF$omputer education in any recognized tateF$entral :overnmentFCniversity, professional courses including )ngineering, Medical, Agriculture, eterinary, Law, Dental, Management, courses like !$(A, $A, $*A, etc., courses conducted by @!M, !!$, EL<+, /!*+ etc. courses offered in !ndia by reputed foreign universitiesF)vening courses of approved institutes, regular degreeF diploma courses like Aeronautical , ilot training , shipping etc. approved by Director :eneral of $ivil A viationF shipping if the course is pursued in !ndia. !n case the course is pursued abroad, the institute should be recognized by the competent local aviationF shipping authority. *or studies abroad, loans
will be
made available only for :raduation and ost0
:raduation $ourses offered by
Ma1imum of
idya"yothi 0 loan for pursuing higher education? Cp to lakhs
26.6=
T lakhs and up to
28.=5
Above
28.6=
25
S2*-
ecurity *or loans up to
$o obligation of parents. /o security
<. > lakhs *or loans above
$o obligation of parents together with collateral security
lakhs and up
in the form of suitable third party guarantee.
to s. 4.=5 lakhs *or loans above
$o obligation of parents together with collateral security.
$ollateral security in the form of /$ FBF L!$ olicyF :oldF haresFDebentures or immovable properties #ank Deposits in the name of studentFarentF:uardian or any other third party with suitable margin. (herever the landF building is already mortgaged the unencumbered portion can be taken as security on second charge basis provided it covers the reuired loan amount. !n case the loan is given for the purchase of computer, the computer has to be hypothecated to the bank...
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H4-:+ 2*-4:
; months after getting the "ob or 26 months after completion of the course whichever is earlier. R2+2.
is left to the option of the student either to service the interest during the study?
period or pay it along with the principal over a period of = 0 4 years to commence from 26th month after completion of the study. I.2*20 02*,--./ % 4.200-4.
*or prompt servicing of interest for all months during the study period when repayment holiday is specified for interest F repayment under the scheme, an interest rebate P2.55
I
is allowed. !nterest concession at 5.=5I on all )ducation Loans to
:irl tudents for pursuing education in !ndia and Abroad is allowed. +he interest rebate thus calculated will be credited back to loan account at the time of commencement of repayment of the principal sum. Download the application form in M 0 (ord format. ave it on your computer, print it out and send it to the nearestFconvenient branch for processing.
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2.5.3.
"EHICLE LOANS E-/-<--
ermanent employment in a ... A :overnment -ffice A public sector undertaking A reputed private enterprise or A self0employed professional +he loan can be applied for in the name of the firm or company. /on
&*or /
!n confirmed service with a take home pay of more than =5I of the gross salary, after * and !nsurance Deductions +he total monthly income of the applicant including that of spouse and other income should be not less than
*or buying a new or used car ¬ more than = years old or new two0wheeler. L4+. +4.
/ew car K Cp to 75I of the cost of the car. Csed car K Cp to 4=I of the market value of the car. /ew two0wheeler 0 75I of the cost of the vehicle or 25 times the gross monthly income or
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/ew car 0 repayable in 46 euated monthly installments Csed car 0 repayable in 8; euated monthly installments /ew +wo0wheeler 0 repayable in 46 euated monthly installments S2*-
%ypothecation of the vehicle purchased +he #anks lien on the vehicle should be marked in the <.$. book ehicle should be insured for the full value with the bank clause P*4200-./ +*/20
*or loan up to F0 in rural areas and F0 per
An application form. alary certificate, !+ return or assessment order as a proof of income. JuotationFpreformat invoice for a new carl new two0wheeler. aluation certificate from two reputed auto dealers 0 for used car.
CLEAN LOAN )mployees in :overnment, ublic ector Cndertakings, reputed private enterprises, firms, companies etc. and confirmed in service. +he take home pay, after deduction of the proposed loan installment should be more than =5I of the gross pay. Lie agents are also eligible to apply for the loan sub"ect to conditions. *or any purpose including any socialFfinancial commitment. a +en times of salary or
29
b *or others, it ! = times of salary or
!n a ma1imum of ;5 months in case the loan is for 250month salary and 8; months in case the loan is for = months salary S2*-
+wo, third party personal guarantee, the salary of each guarantor being at least eual to that of the borrower. O2* 4.:--4.
2. +he employee should have a .#. account in the branch from where the loan is proposed to be availed. 6. alary of the employee should be routed through the .#. account at the branch where the loan is sanctioned. 8. Cndertaking letter from the employer undertaking to deduct from salary, loan installment every month and remit to bank to be produced. >. Letter from the employer, undertaking to recover the dues from the terminal benefits of the employee in case of death, retirement or resignation to be produced. D42.0 *2-*2:
Application form, alary certificate of applicant and guarantor with deduction particulars, undertaking letter from employer to deduct monthly installment and recover the dues from terminal benefit in case of necessity. P*4200-./ F22 -ne0time processing fee of F0 per lakh or part thereof
&sub"ect to change. R+2 4= *2*.0 $lean Loan 0 loan to employees of reputed organizations to meet personal e1penditure? 2=.6=I
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CONSU!PTION LOANS E-/-<--
!ndividual, confirmed permanent employee of a reputed organization or a professional or self0employed or businessperson with three years standing in the field of activity, can apply for the loan. *or salaried person the take home pay is at least >5I of the gross salary after taking into account the installment for the present loan. P*402
*or meeting social financial commitments such as marriage in the family, education of children, medical treatment etc. +he loan can be availed for any financial commitment with in the ambit of law. #ank will not verify the purpose declared. !+>- 4+.
Ma1imum loan amount is
ahayika0 Loan to meet social financial commitments? 2>I
CREDIT CARD #ank in association with !A has introduced isa !nternational $redit $ard in order to pay for the e1penses for shopping, dining, travelling etc. +he customers can also use the card for drawing cash from any of the !-#'s !nstant $ash A+M and all the A+Ms that display the !A logo. -ur #ank is issuing two types of cards i.e. !-# :old
H
!-# $lassic. !nterest charged is 6>I per annum &annualized. +he
minimum card limit is
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INTERNATIONAL "ISA DEBIT CARDS !ndian -verseas #ank has tied up with isa for its !nternational Debit $ard rogram. A large segment of the #ank's customers still prefers to spend from their income and savings rather than availing credit. (ith the introduction of Debit cards, this long felt desire of customers to pay for the purchases at shops and business establishments directly from their account would be fulfilled.
!t
would no longer be
reuired for the customer to draw cash either from the A +M or from the branch counters to pay for them spends. /o charges would be levied by our #ank on such oint of ale transactions, e1cept for using in etrol #unks. *or Drawing cash, customers can use these cards not only in our #ank's A+Ms, but also in any #ank's A+M that display the !A logo. +he #ank, in its constant endeavor to enhance customer service, has already tied up with a consortium of #anks under the banner of /* and $ash +ree by which customers can access their individual accounts from more than 3>,555 A+Ms. $ustomers can also use their Debit cards !-# during their visits abroad. !n addition, the cards can also be used through secured electronic payment gateways for ecommerce F !nternet payments.
L-=2 I.0*+.2%IOB J22,+. IOB%J22,+. % G*4 L-=2 I.0*+.2 S22 -. +004-+-4. - L-2 4= I.:-+ + -0 IOB%J22,+. S22
+he scheme is a :roup +erm Assurance scheme for the account holders of !ndian -verseas #ank, with very low premium offered in association with L!$ of !ndia. +he insurance cover is available to account holders who pay the prescribed premium.
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4 +*2 2-/-<2 4 4-. 2 022 Y4 +*2 2-/-<2 -= 4 +*2
)1isting account holder of the #ank maintaining a avings #ank or a $urrent Deposit account in your individual capacity either singly or "ointly with others. -pened a fresh .#. or $.D. account in your individual capacity either singly or "ointly with others. $ompleted 23 years of age and not over => years of age. TA; SA"ER SCHE!E
!n the *inance Act 655;, ection 35$ of !ncome +a1 Act 27;2 was amended to include deposits placed with a scheduled bank to ualify for deduction under 35$. +he amount of investment up to
+he deposit scheme is open to individuals. +he Barta of a %indu Cndivided *amily &%C* can open in his capacity as Barta. +he deposit can be in the single name of the depositor or in "oint names of two adults or "ointly in the name of an adult with a minor &only two "oint account holders are permitted payable to either or survivor. !n the case of deposits in the "oint names, the ta1 benefit can be claimed by the first named depositor. H4 :240- +. <2 +22:
A ma1imum of
+he deposit is accepted for any period from = years to 25 years.
33
T20 4= :240- + +. <2 +22:
+he deposit can be accepted in the form of reinvestment deposit &
+he deposit can be accepted by all branches of the #ank. T*+.0=2* 4= :240-
(hile transfer of deposit between branches of !-# is permitted, transfer between banks is not permitted. #ranches, therefore, should not accept deposits transferred from another bank. S2-+ 4.:--4.0 =4* -002 4= :240- *22-
+he A/ number of the depositor and his signature will appear on the deposit receipt. L4+. +/+-.0 :240- +2-./ 2 :240- +0 4+2*+ 02*-
Loan cannot be granted against the deposit nor can the deposit be accepted as collateral security. R2+2. 4= :240-
Deposit is repayable on or after maturity date in the normal course. remature closure is not permitted till the deposit completes = years from date of deposit. R+2 4= I.2*20
pecial rate of interest is offered for the deposits. pecial rate for deposits of
34
N4-.+-4.
/omination can be made for the deposits as per the e1isting rules for nomination. /o nomination, however, can be accepted in the case of deposits held for and held by or on behalf of a minor. R2+22. 4= 40:20*42: :240- *22-
!n case of deposit receipt lost or destroyed, duplicate receipt can be issued by furnishing an indemnity. D2+ 4= :240-4*
!n case of death of depositor, the nominee is entitled to claim the deposit amount before or after the maturity date. +he claim from nominee will be settled as per the current guidelines in force for settlement of claim on death of depositors. !n case of deposits where the depositor died without giving nomination, the deposit amount can be settled to the legal heirs. T+> -+<-- 4. -.2*20 4. 2 :240-
!nterest on the term deposit is liable to ta1 under the !ncome +a1 Act.
35
LEARNING PROCESS
36
FIRST EEK !n the first week of internship the intern learnt about the general banking operations in day today life. +he intern also leant about how to fill the different types of challan available in the bank and the intern also helped out the customers. +he intern also learnt about how to handle cash receipts and payments. +he intern learnt about the procedures for opening different deposit accounts &savings account, current account, fi1ed deposit account. +he intern learnt about the process of clearing the bank cheaue9 lodging of own bank cheaue and posting them. +he intern was helping customers with -pening and posting of avings #ank account, fi1ed deposit account, current account, etc.
SECOND EEK During the second week of internship the intern learnt about demand draft printing, issuing and cancelling to update transactions. +he intern was taught about e0banking facility. +he intern learnt about debit credit transfer and the issue of closing book. +he intern also learnt about opening and closing of recurring deposit, fi1ed deposit, account opening and closing and posting them.
THIRD EEK During the third week of internship the intern learnt about master creation, interest calculation and closure of advances. +he intern learnt how to loan and renewal of loan. +he intern learnt about the procedures to avail different kinds of loan. +he intern was also taught about the gold loan calculations9 filling of clean loan, study loan, vehicle loan, personal loan forms and pensioners loan forms. +he intern also learnt about life certificate9 verification of performing and non0 performing assets of day end process in a bank.
FOURTH EEK During fourth week of internship the intern helped the customers by printing pass book entries, lodging and posting of withdrawal challans and self cheues, then issuing of tokens. +he inter also learnt about opening of an A+M account9 recording and issuing of A+M cards to the customers. +he intern learnt about charges for A+M service from customers. +he intern was also taught about the lockers operations.
37
CONSOLIDATION OF REPORTS
38
CONCLUSION
65
+o conclude, this internship at !ndian -verseas #ank gave the inter the necessary e1posure to work in an environment which thrives for e1cellence. +he intern was made aware of the various banking activities and the different schemes and policies offered to its customers. +he intern e1perienced what it is like to work with a diverse group of people who belong to different age groups. +he intern gained e1perience in dealing with customers and learnt how a friendly and efficient atmosphere is maintained in the workplace. +he intern was able to understand and the vital role it plays in the society.
66
ANNE;URES
BIBLIOGRAPHY
78
