RETAIL BANKING & WHOLESALE BANKING

PRESENTED BY. PRITI SENAPATI(113) SANJEEB SAHOO(114) SAJAN PRADHAN(115) DEEPTIKANT SAHU(116) ANUSRI DALAI(118) SATYAJEET MOHAPATRA(125)

RETAIL &WHOLESALE BANKING

MEANING OF RETAIL BANKING

Retail

banking is generally refers to offering financial services, products related to deposits and asset to individual customers for personal consumption. concentrate on various segment like professional, housewives, pensioner, children, salaried class etc.

Bank

CONTD
Different

types of product like recurring deposits, saving bank deposits, F.D, credit cards, housing & consumer loans are offered by bands of the above mentioned market segments.

PRESENT SCENARIO

Indian retail banking phenomenal growth

has

been

showing

In 2009-10, 62% of credit growth came from retail Over the last 5 years CAGR has been over 39%

Retail credit levelcrossed Rs.230K Crore in 200910

Market has transformed into a buyers market from a sellers market

Comprises of multiple products, channels of distribution and multiple customer groups

ECONOMY VS. RETAIL BANKING

Retail assets are just 22% of the total banking assets of India Contribution of retail loans to GDP: India 6% China 15 %, Thailand 24% Taiwan 52% Indian population below 35 yrs of Age 70 % Reach of Formal Banking Channels 20-25% of Indian population

DRIVERS OF RETAIL GROWTH

CHANGING CONSUMER DEMOGRAPHICS

Growing disposable incomes Youngest population in the world Increasing literacy levels Higher adaptability to technology Growing consumerism Fiscal incentives for home loans Changing mindsets-willingness to borrow/lend Desire to improve lifestyles Banks vying for higher market share

MARKET SHARE: RETAIL LOAN - 2005

Consumer Durables 7%

Auto 28% Home 49%

Other personal Loans 16%

INDUSTRYS RESPONSE TO THE CHANGE

Any where, Any time Banking Improved processes/Bundled product offerings Faster service/Reduced TATs Customer specific products/offerings on a regular basis Bank customer has replaced Branch customer Focus on understanding customer needs/ preferences Segmentation/Differentiation of customers Customer driven strategies Building relationships

FUTURE OF RETAIL BANKING

The accelerated retail growth has been on a historically low base Penetration continues to be significantly low compared to global bench marks

Share of retail credit expected to grow from 22% to 36%

Retail credit expected to grow to Rs.575,000 crs by 2010 at an annual growth rate of 25%

FUTURE OF RETAIL BANKING

CONTD.

Dramatic changes expected in the portfolio of Banks in the next 5 years

credit

Housing will continue to be the biggest growth segment, followed by Auto loans

Banks need to expand and diversify by focussing on non urban segment as well as varied income and demographic groups Rural areas offer tremendous potential too which needs to be exploited

CHALLENGES

Sustaining Customer loyalty NPA reduction & Fraud prevention

Avoiding Debt Trap for customers

Bringing Rural masses into mainstream banking

ADVANTAGES OF RETAIL BANKING

Less risk Smooth ALM(Asset Liability management)

Cheap funds
Increasing income of middle class

PROBLEMS OF RETAIL BANKING

Infrastructure

Less

spread

Increasing

volumes

Customers

are attracted towards other financial products like mutual funds.

MEANING OF WHOLESALE BANKING

It is generally refers banking services between merchant banks and other financial institutions. Wholesale banking also is an option that is open for real estate developers, market investors and other businesses that operate in the buying and selling for properties and other forms of investment.

It provide services involves dealing with other banks, the central bank, private companies and investment institutions.

ADVANTAGES OF WHOLESALE BANKING

Application is the easy access to the total financial portfolio. Transfer fund between two accounts much simpler. Focuses more on corporate-style entities. High value transaction.

DEMERITS OF WHOLESALE BANKING

Focuses only large institutions.

CONCLUSION.

THANK YOU.