FOREIGN EXCHANGE MANAGEMENT: A STUDY ON EXCHANGE RISK MANAGEMENT TECHNIQUES OF THE CUSTOMERS OF IOB, PONDICHERRY. Done for Project report submitted in partial fulfillment of the requirement of Pondicherry University for the award of the degree of MASTER OF BUSINESS ADMINISTRATION Submitted By KARTHIGA. D (Reg No.1095526) Under the guidance of INTERNAL GUIDE: EXTERNAL GUIDE: Dr. B. CHARUMATHI, Mr. S. RAJARAJAN Associate Professor Manager (Foreign Exchange Dept) Department of Management Studies Indian Overseas Bank School of Management Puducherry. Pondicherry University
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FOREIGN EXCHANGE MANAGEMENT: A STUDY ON EXCHANGE
RISK MANAGEMENT TECHNIQUES OF THE CUSTOMERS OF IOB,
PONDICHERRY.
Done for
Project report submitted in partial fulfillment of the requirement of Pondicherry University for
the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
Submitted By
KARTHIGA. D
(Reg No.1095526)
Under the guidance of
INTERNAL GUIDE: EXTERNAL GUIDE:
Dr. B. CHARUMATHI, Mr. S. RAJARAJAN
Associate Professor Manager (Foreign Exchange Dept)
Department of Management Studies Indian Overseas Bank
School of Management Puducherry.
Pondicherry University
DEPARTMENT OF MANAGEMENT STUDIESSCHOOL OF MANAGEMENTPONDICHERRY UNIVERSITY
PUDUCHERRY- 605 014
MAY-JUNE 2010
DEPARTMENT OF MANAGEMENT STUDIES
SCHOOL OF MANAGEMENT
PONDICHERRY UNIVERSITY
PUDUCHERRY-605014
CERTIFICATE
This is to certify that this project entitled “FOREIGN EXCHANGE MANAGEMENT: A
STUDY ON EXCHANGE RISK MANAGEMENT TECHNIQUES OF THE
CUSTOMERS OF IOB, PONDICHERRY.” done for INDIAN OVERSEAS BANK, Main
Branch, Puducherry, is submitted by KARTHIGA. D, I year MBA (Reg NO. 1095526) to the
Department of Management Studies, School of Management, Pondicherry University in
partial fulfillment of the degree requirement for the award of degree Master of Business
Administration and is certified to be an original and bonafide work.
DR.R.P.RAYA DR.B.CHARUMATHI
Professor & Head of the Department Reader
Place: Puducherry
Date:
DECLARATION
I, KARTHIGA. D, Student of Department of Management Studies, Pondicherry
University, hereby declare that this project report titled “FOREIGN EXCHANGE
MANAGEMENT: A STUDY ON EXCHANGE RISK MANAGEMENT
TECHNIQUES OF THE CUSTOMERS OF IOB, PONDICHERRY” is an
original work done by me and submitted to the Department of Management
Studies, for the award of Master Degree in Business Administration. I further
declare that any part this project itself has not been submitted elsewhere for award
of any degree.
PLACE:
DATE: Signature of the candidate
ACKNOWLEDGEMENT
I am indebted to the powerful Almighty God for all the blessings he showered on me and
for being with me throughout the study.
I place on record my sincere gratitude and appreciation to my project guide
Dr.B.CHARUMATHI, Reader, Department of Management Studies, for her kind co-operation
and guidance which enabled me to complete this project.
I express my sincere thanks to Dr.R.P.RAYA, HOD, Department of Management Studies,
School of Management, Pondicherry University, who provided me an opportunity to do this
project.
I am deeply obliged to Mr.S.RAJARAJAN, Manager (Foreign Exchange Department), Indian
Overseas Bank, Main Branch, Puducherry, for his exemplary guidance and support without
whose help this project would not have been success.
I take this opportunity to dedicate this project to my parents who were a constant source of
motivation and I express my deep gratitude for their never ending support and encouragement
during this project.
Finally I thank each and everyone who helped me to complete this project.
KARTHIGA. D
(Signature of the Candidate)
EXECUTIVE SUMMARY
This report summarizes the result of the project done by Karthiga. D, student of
Department of Management Studies, School of Management, Pondicherry University, at Indian
Overseas Bank, Main Branch, Puducherry. This project aims at a study on the exchange Risk
Management techniques of the customers of Indian Overseas Bank.
The Indian economy has undergone drastic changes in the recent years whereby it ceased
to be a closed and protected economy, and adopted the globalization route, to become a part of
the world economy. In the pre-liberalization era, marked by State dominated, tightly regulated
foreign exchange regime, the only Risk Management tool available for corporate enterprises was,
‘lobbying for government intervention’. With the advent of LERMS (Liberalised Exchange Rate
Mechanism System) in India, in 1992, the market forces started to present a regime with steady
price volatility as against the earlier trend of long periods of constant prices followed by sudden,
large price movements. The unified exchange rate phase has witnessed improvement in
informational and operational efficiency of the foreign exchange market, though at a halting
pace.
In the corporate finance literature, research on Risk Management has focused on the
question of why firms should hedge a given risk. This project tells us that measuring risk
exposures is an essential component of a firm's Risk Management strategy. Without knowledge
of the primitive risk exposures of a firm, it is not possible to test whether firms are altering their
exposures according to the global market. The First generation derivative instruments are the
most popular and most preferred one - Forward contracts. In my project, the study is done based
on these Forward contracts which were considered as the most important hedging tool
undertaken by the customers of the Indian Overseas Bank, Pondicherry Branch.
In addition to the traditional instruments like the Forward contracts, the Second-
generation instruments, namely Swaps and Futures have also come into use. This is followed by
the Third Generation category, the Rupee-Dollar Options that are being largely preferred.
Corporate enterprises have had to face the challenges of the shift from low risk to high
risk operations involving foreign exchange. There was increasing awareness of the need for
introduction of financial derivatives in order to enable hedging against market risk in a cost
effective way. Earlier, the Indian companies had been entering into Forward contracts with
banks, which were the Authorized Dealers (AD) in foreign exchange. But many firms preferred
to keep their risk exposures un-hedged as they found the Forward contracts to be very costly. In
the current formative phase of the development of the foreign exchange market, it will be
worthwhile to take stock of the initiatives taken by corporate enterprises in identifying and
managing foreign exchange risk.
This study gives an outlook in the area of NRI accounts and the Pre-shipment and Post-
shipment advances provided to the customers. This gives an idea about the current position of
these facilities granted to their customers.
The spurts in foreign investments in India have led to substantial increase in the quantum
of inflows and outflows in different currencies, with varying maturities. This study also tells us
how the banks are managing their inflow and outflow of their currencies. It is also examined
whether this branch of the bank can manage their import remittances through their own export
payments without going to the foreign exchange markets.
INTRODUCTION
1.1 INTRODUCTION TO THE TOPIC
The importance of Risk Management has been extensively recognized by banks and
securities firms when deciding the amount of risk they are willing to take. Moreover, bank
regulators now put an emphasis on Risk Management practices in attempting to reduce the
fragility of financial and banking system.
India had earlier followed a tightly regulated foreign exchange regime. The liberalization
of the Indian economy started in 1991. The 1992-93 Budget provided for partial convertibility of
Indian Rupee in current accounts and, in March 1993, the Rupee was made fully convertible in
current account. Demand and supply conditions now govern the exchange rates in our foreign
exchange market. A fast developing economy has to cope with a multitude of changes, ranging
from individual and institutional preferences to changes in technology, in economic policies, in
regulations etc. Besides, there are changes arising from external trade and capital account
interactions. These generate a variety of risks, which have to be managed. There has been a
sharp increase in foreign investment in India. Multi-national and transnational corporations are
playing increasingly important roles in Indian business. Indian corporate units are also engaging
in a much wider range of cross border transactions with different countries and products. Indian
firms have also been more active in raising financial resources abroad. All these developments
combine to give a boost to cross-currency cash flows, involving different currencies and different
countries.
With increased emphasis on Risk Management in business, the use and varieties of
derivatives have multiplied. Similarly in the management of foreign exchange, derivatives have
a significant role to play.
1.2 NEED FOR THE STUDY
The face of banking in India is changing rapidly. The enhanced role of the banking
sector in the Indian economy, the increasing levels of deregulation along with the increasing
levels of competition have facilitated globalization, thus, leading the corporate and banks to face
various challenges and risks.
The major risk the global firms face is the exchange risk which is caused by the
fluctuations in the exchange rates. These fluctuations have created unbalanced profit and loss
patterns to the global business firms. Thus, in order to reduce these risks, the corporate make
use of the various derivative instruments available with the banks.
The utmost need for this project is to ensure whether the customers of Indian Overseas
Bank are aware of the exchange risks and the tools used to mitigate them. Further, this study
also deals with the analysis of the present trend of the NRI accounts and other facilities provided
to the customers by the bank.
1.3. STATEMENT OF THE PROBLEM
International transactions are exposed to various risks. This study makes an attempt to
know about the exchange risk and to understand exchange Risk Management techniques
employed at Indian Overseas Bank, Puducherry.
1.4 OBJECTIVES OF THE STUDY
The objectives as this study can be as follows:
1.4.1 PRIMARY OBJECTIVE
The foremost objective of this project is to understand the Risk Management Techniques
employed at Indian Overseas Bank, Puducherry.
1.4.2 SECONDARY OBJECTIVE
Further, this study also attempts to,
Analyze the trend of the NRI deposits at the Bank.
Identify the problems associated with Pre-Shipment and Post-Shipment advances
available to their clients.
Examine the relationship between the inflow and outflow of foreign currencies at the
branch level.
1.5 RESEARCH METHODOLOGY
All the findings and conclusions obtained in this report are based on the data available in
the bank and the conversation made with the customers of the bank.
1.5.1 RESEARCH DESIGN:
This Research was initiated by examining the secondary data to gain insight into the
situation prevailing in the bank. By analyzing the secondary data, the study aim is to explore the
short comings of the present system and primary data will help to validate the analysis of
secondary data besides on unrevealing the areas which calls for improvement.
1.5.2 COLLECTION OF DATA:
The data collected for this project is primary as well as secondary data.
Primary data:
A telephonic interview was made to the people of different profession. Some
were also personally visited and interviewed. They were the main source of Primary
data. The method of collection of primary data was direct personal interview through
word-of-mouth.
Secondary Data:
The secondary data was collected from internal sources. It was collected on the
basis of bank’s books of accounts, organizational file, official records, preserved
information in the bank’s database and their official website.
1.5.3 SAMPLING PLAN:
Sampling Units: The managerial professionals dealing with export and imports of
different companies were interviewed. The basic criterion is that their company should
maintain an account with the Indian Overseas Bank’s forex department, Puducherry.
Research Instrument: The managerial professionals were contacted through telephone
from the bank since they were situated in different areas. The customers who came to
bank were also asked the same questions.
Contact Method: Personal interview and Telephonic interview.
1.5.4 SAMPLE SIZE:
My sample size for this project is 28 respondents. The entire customers who deal with
import and export business was considered for this study. The telephonic interview method was
selected due to the geographical location of the customers as well as the number of customers
was very low.
1.5.5 RESEARCH LIMITATIONS:
Though I have covered all the customers of the Indian Overseas Bank the number of
customers was very low since it is a very small branch.
1.5 LIMITATIONS OF THE STUDY:
The operations of the Indian Overseas Bank are subject to certain limitations
which are identified as follows:
The study is done only at a micro level and is restricted to the Pondicherry branch. The
customers were less in number and whatever analyzed was limited to that extent.
The secondary data collected and taken into consideration in order to fulfill the objectives
of this project includes the data recorded in their books of accounts and the data available
from the website of the Bank. The data used for analysis cover a period of 4 years
starting from April, 2006 to March, 2010 and whatever analyzed is limited to the same
period.
The scope is limited to the types of foreign currency accounts that are currently
maintained in this branch and therefore the other types of foreign currency accounts that
are in existence are excluded.
1.7. CHAPTERIZATION:
Chapter 1: This chapter mainly deals with an introduction to the topic of study. It gives an
idea about the primary objective of the study and the problem to be addressed. It says about the
research methodology and tools used for analysis.
Chapter 2: This chapter gives an introduction to the banking industry and a detailed the
profile of the Indian Overseas Bank. It also gives an in depth study about the organization viz.,
IOB. It includes information right from the inception of the bank and its subsidiaries and their
financial highlights. Further, information is provided regarding the Forex Department of the
Bank, which has its inception since 1948.
Chapter 3: This chapter provides the conceptual framework about the topic of study. It gives
an introduction to the International Business. It explains about the Risk Management techniques
and the derivatives used to mitigate the exchange risk. It also gives an insight into various types
of exchange rates, different types of NRI accounts, Pre-Shipment and Post-Shipment advances.
It justifies the need for the study.
Chapter 4: This chapter provides the detailed analysis of the primary data collected through
telephonic interview and secondary data collected from the organization. It is followed by
interpretation of the same.
Chapter 5: This chapter indicates the summary of findings, suggestions and conclusion of the
analysis done in Chapter 4.
CHAPTER 2
2.1 AN INTRODUCTION TO INDIAN BANKING INDUSTRY:
The Indian Banking industry, which is governed by the Banking Regulation Act of India,
1949 can be broadly classified into two major categories, non-scheduled banks and scheduled
banks. Scheduled banks comprise commercial banks and the co-operative banks. In terms of
ownership, commercial banks can be further grouped into nationalized banks, the State Bank of
India and its group banks, regional rural banks and private sector banks (the old/ new domestic
and foreign). These banks have over 67,000 branches spread across the country.
The first phase of financial reforms resulted in the nationalization of 14 major banks in
1969 and resulted in a shift from Class banking to Mass banking. This in turn resulted in a
significant growth in the geographical coverage of banks. Every bank had to earmark a minimum
percentage of their loan portfolio to sectors identified as “priority sectors”. The manufacturing
sector also grew during the 1970s in protected environs and the banking sector was a critical
source. The next wave of reforms saw the nationalization of 6 more commercial banks in 1980.
Since then the number of scheduled commercial banks increased four-fold and the number of
bank branches increased eightfold.
After the second phase of financial sector reforms and liberalization of the sector in the
early nineties, the Public Sector Banks (PSB) s found it extremely difficult to compete with the
new private sector banks and the foreign banks. The new private sector banks first made their
appearance after the guidelines permitting them were issued in January 1993. Eight new private
sector banks are presently in operation. These banks due to their late start have access to state-of
the-art technology, which in turn helps them to save on manpower costs and provide better
services.
During the year 2000, the State Bank of India (SBI) and its 7 associates accounted for a
25 percent share in deposits and 28.1 percent share in credit. The 20 nationalized banks
accounted for 53.2 percent of the deposits and 47.5 percent of credit during the same period. The
share of foreign banks (numbering 42), regional rural banks and other scheduled commercial
banks accounted for 5.7 percent, 3.9 percent and 12.2 percent respectively in deposits and 8.41
percent, 3.14 percent and 12.85 percent respectively in credit during the year 2000.
Current Scenario
The industry is currently in a transition phase. On the one hand, the PSBs, which are the
mainstay of the Indian Banking system, are in the process of shedding their flab in terms of
excessive manpower, excessive non Performing Assets (NPAs) and excessive governmental
equity, while on the other hand the private sector banks are consolidating themselves through
mergers and acquisitions.
Private sector Banks have pioneered internet banking, phone banking, anywhere banking,
mobile banking, debit cards, Automatic Teller Machines (ATMs) and combined various other
services and integrated them into the mainstream banking arena, while the PSBs are still
grappling with disgruntled employees in the aftermath of successful VRS schemes. Also,
following India’s commitment to the W To agreement in respect of the services sector, foreign
banks, including both new and the existing ones, have been permitted to open up to 12 branches
a year with effect from 1998-99 as against the earlier stipulation of 8 branches.
Meanwhile the economic and corporate sector slowdown has led to an increasing number
of banks focusing on the retail segment. Many of them are also entering the new vistas of
Insurance. Banks with their phenomenal reach and a regular interface with the retail investor are
the best placed to enter into the insurance sector. Banks in India have been allowed to provide
fee-based insurance services without risk participation, invest in an insurance company for
providing infrastructure and services support and set up of a separate joint-venture insurance
company with risk participation.
Governmental Policy
After the first phase and second phase of financial reforms, in the 1980s commercial
banks began to function in a highly regulated environment, with administered interest rate
structure, quantitative restrictions on credit flows, high reserve requirements and reservation of a
significant proportion of lendable resources for the priority and the government sectors. The
restrictive regulatory norms led to the credit rationing for the private sector and the interest rate
controls led to the unproductive use of credit and low levels of investment and growth. The
resultant ‘financial repression’ led to decline in productivity and efficiency and erosion of
profitability of the banking sector in general. This was when the need to develop a sound
commercial banking system was felt. This was worked out mainly with the help of the
recommendations of the Committee on the Financial System (Chairman: Shri M. Narasimham),
1991. The resultant financial sector reforms called for interest rate flexibility for banks, reduction
in reserve requirements, and a number of structural measures. Interest rates have thus been
steadily deregulated in the past few years with banks being free to fix their Prime Lending Rates
(PLRs) and deposit rates for most banking products. Credit market reforms included introduction
of new instruments of credit, changes in the credit delivery system and integration of functional
roles of diverse players, such as, banks, financial institutions and non banking financial
companies (NBFCs). Domestic Private Sector Banks were allowed to be set up, PSBs were
allowed to access the markets to shore up their Cars.
The Indian banking system is financially stable and resilient to the shocks that may arise
due to higher non-performing assets (NPAs) and the global economic crisis, according to a stress
test done by the Reserve Bank of India (RBI).
Significantly, the RBI has the tenth largest gold reserves in the world after spending US$
6.7 billion towards the purchase of 200 metric tonnes of gold from the International Monetary
Fund (IMF) in November 2009. The purchase has increased the country's share of gold holdings
in its foreign exchange reserves from approximately 4 per cent to about 6 per cent.
In the annual international ranking conducted by UK-based Brand Finance Plc, 20 Indian
banks have been included in the Brand Finance® Global Banking 500. In fact, the State Bank of
India (SBI) has become the first Indian bank to be ranked among the Top 50 banks in the world,
capturing the 36th rank, as per the Brand Finance study. The brand value of SBI increased from
US$ 1.5 billion in 2009 to US$ 4.6 billion in 2010. ICICI Bank also made it to the Top 100 list
with a brand value of US$ 2.2 billion. The total brand value of the 20 Indian banks featured in
the list stood at US$ 13 billion.
Meanwhile, loan disbursement from scheduled commercial banks which included
regional rural banks as well posted a growth of 16.04 per cent by March 12, 2010, on a year-on-
year basis, as per the latest data released by RBI. The RBI had earlier predicted that the credit
growth during 2009-10 would be around 16 per cent.
Following the financial crisis, new deposits have gravitated towards public sector banks.
According to RBI's 'Quarterly Statistics on Deposits and Credit of Scheduled Commercial
Banks: September 2009', nationalised banks, as a group, accounted for 50.5 per cent of the
aggregate deposits, while State Bank of India (SBI) and its associates accounted for 23.8 per
cent. The share of other scheduled commercial banks, foreign banks and regional rural banks in
aggregate deposits were 17.8 per cent, 5.6 per cent and 3.0 per cent, respectively.
With respect to gross bank credit also, nationalised banks hold the highest share of 50.5
per cent in the total bank credit, with SBI and its associates at 23.7 per cent and other scheduled
commercial banks at 17.8 per cent. Foreign banks and regional rural banks had a share of 5.5 per
cent and 2.5 per cent respectively in the total bank credit.
The report also found that scheduled commercial banks served 34,709 banked centres. Of
these centres, 28,095 were single office centres and 64 centres had 100 or more bank offices.
The confidence of non-resident Indians (NRIs) in the Indian economy is reviving again.
NRI fund inflows increased since April 2009 and touched US$ 47.8 billion on March 2010, as
per the RBI's June 2010 bulletin. Most of this has come through Foreign Currency Non-resident
(FCNR) accounts and Non-resident External Rupee Accounts.
Foreign exchange reserves were up by US$ 1.69 billion to US$ 272.8 trillion, for the
week ending June 11, on account of revaluation gains. June 21, 2010.
Major Developments:
The Monetary Authority of Singapore (MAS) has provided qualified full banking (QFB)
privileges to ICICI Bank for its branch operations in Singapore. Currently, only SBI had QFB
privileges in country.
The Indian operations of Standard Chartered reported a profit of above US$ 1 billion for
the first time. The bank posted a profit before tax (PAT) of US$ 1.06 billion in the calendar year
2009, as compared to US$ 891 million in 2008.
Punjab National Bank (PNB) plans to expand its international operations by foraying into
Indonesia and South Africa. The bank is also planning to increase its share in the international
business operations to 7 per cent in the next three years.
The State Bank of India (SBI) has posted a net profit of US$ 1.56 billion for the nine
months ended December 2009, up 14.43 per cent from US$ 175.4 million posted in the nine
months ended December 2008.
Amongst the private banks, Axis Bank's net profit surged by 32 per cent to US$ 115.4
million on 21.2 per cent rise in total income to US$ 852.16 million in the second quarter of 2009-
10, over the corresponding period last year. HDFC Bank has posted a 32 per cent rise in its net
profit at US$ 175.4 million for the quarter ended December 31, 2009 over the figure of US$
128.05 million for the same quarter in the previous year.
Government Initiatives:
The government plans to invest US$ 3.63 billion into public sector banks to aid them for
maintaining their Capital Adequacy Ratio (CAR), as per the Union Budget presented by the
Union Finance Minister in February 2010. Out of the total allocation, US$ 2.1 billion would be
used for recapitalisation of the public sector banks during April-June 2010 and US$ 1.5 billion
will be invested during the rest of 2010-11.
The RBI has allowed banks to make changes in the repayment schedules or drawdown
without prior approval from the central bank. However, such a change could be made on the
condition that the average maturity of the loan should remain the same. The move is expected to
make external commercial borrowing (ECB) transactions easier. Transactions both through
automatic and approval routes can take advantage of this change. Now, without the prior
approval of RBI, Indian companies may borrow up to US$ 500 million in a year.
Further, RBI also allowed domestic scheduled commercial banks to open up their
branches in Tier III to Tier VI regions that have population of up to 49,999 without the prior
permission of the central bank. Banks such as PNB and UCO Bank are planning to take
advantage of this initiative and would open around 440 and 89 branches, respectively, in such
regions.
In its platinum jubilee year, the RBI, the central bank of the country, in a notification
issued on June 25, 2009, said that banks should link more branches to the National Electronic
Clearing Service (NECS). Ideally, all core-banking-enabled branches should be part of NECS.
NECS was introduced in September 2008 for centralised processing of repetitive and bulk
payment instructions. Currently, a little over 26,000 branches of 114 banks are enabled to
participate in NECS.
The repo rate and the reverse repo rate were increased by 25 basis points each in mid-March
2010.
The Monetary Policy Statement 2010-11, dated April 20, 2010, specifies the following monetary
measures:
i. The repo rate has been raised by 25 basis points from 5.0 per cent to 5.25 per cent with
immediate effect.
ii. The reverse repo rate has been raised by 25 basis points from 3.5 per cent to 3.75 per cent
with immediate effect.
iii. The cash reserve ratio (CRR) of scheduled banks has been raised by 25 basis points from
5.75 per cent to 6.0 per cent of their net demand and time liabilities (NDTL) effective the
fortnight beginning April 24, 2010.
Meanwhile, outstanding bank credit in the 15 days up to January 29, 2010 rose by US$
4.32 billion, pointing to a revival in credit growth. This is the highest year-on-year growth
recorded since August 14, 2009. Furthermore, the outstanding bank credit in the 15 days up to
February 12, 2010, rose by US$ 4.87 billion to US$ 658.24 billion, according to data from the
Reserve of Bank of India (RBI), marking a 15.07 per cent year-on-year growth in credit.
2.2 PROFILE OF THE BANK
INDIAN OVERSEAS BANK: INTRODUCTION
Indian Overseas Bank (IOB) was founded on 10th February 1937 and has distinction of
three branches at Chennai, Karaikudi and Rangoon(Myanmar) simultaneously commencing
business on the inaugral day. The founder Chairman was M. Chidambaram Chettiyar. It was
started with a vision to specialise in foreign exchange and overseas banking business in India.
At the dawn of Independence, IOB had 38 branches in India and 7 branches abroad. Its
deposits stood at Rs.6.64 Crores and advances at Rs.3.23 Crores at that time. Before 1969, it has
ventured into consumer credit, had begun with computerisation and had 195 branches in India.
In 1969, when it was nationalised, the bank has 208 branches with aggregate deposits of Rs.
67.70 Crores and advances of Rs. 44.90 Crores.
IOB is currently one if the major banks based in Chennai, with 1845 domestic branches
and 12 branches overseas. IOB also has an ISO certified in house information technology
department, which has devloped the software that most of its branches use to provide online
banking to customers. IOB has a network of more than 500 ATMs all over India and IOB’s
international visa debit card is accepted at all the ATMs. IOB offers internet banking (E-see
banking) and is one of the banks that the government of India has approved for online payment
of taxes.
IOB provides various banking services, including saving bank, current account, credit
facilities nad other services. IOB also provides Non residential Indian (NRI) services, personal