Commercial Banks

IntroductionTheoretical Basis of Banking operationsBalancing Profitability with liquidity Management, Management of Reserves, Creation of Credit

Special Role of Commercial Banks

The privileged role Safe and convenient Lending to industries

Bank Performance
Interests-80% of the income Fee based Activity Trading Income

Banking Innovations
Participation Certificates and inter bank operations Consortium Approach Credit Card New Technology Stock investment Other Diversification in Banking Risk Management ATMS

Changes in the concept of bank lending

Liquidation and going concern approach Credit plans Agricultural credit plan Determinants of bank credit

Other aspects
Seasonal character Credit Information Techniques for attracting savings Utilisation of resources Retailing banking Banks foreign business Bank as authorised dealers Micro Finance

Co-operative Banks
Introduction Origin and Growth- tasks of production, processing, marketing, distribution, servicing and banking 1904- rural and agriculture related

Features of co-operative banks

The principles of co-operation, self-help and mutual help They function on no profit , no loss basis They perform all the banking operations Business mainly in the rural and agriculture related activities They are the first government supported, sponsored and subsidised financial agency They belong to capital as well as money market Partially financial intermediaries Subject to CRR AND Liquidity requirements Cooperative banks accept current, saving, and fixed deposits from individuals and institutions including banks It is a three tier linkages

Structure
It is a three tier linkages between the state, district and village RBI NABARD SCBs SLDBs UCBs DCCBs DCLDBs PACs PLDBs Branches of SLDBs

Salient Features
The cooperative banks now operating in India outnumbered the commercial banks Deposits, credit working capital and other indicators have grown manifold The DCCBs have been mobilizing the largest amount of deposits

Khusro Committee Recommendations

It felt that the cooperative banks must work as a total system The higher tiers of the system must take proper care of the lower tier system There should be always a mutual benefit within the whole system There should be a commonly shared interest in the in deposits mobilisation, profits and reserves Reforms suggested is to set up an apex institutions NCCI