Role of Foreign Commercial Banks in Indian Economy

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Role of Foreign CommercialBanks in Indian Economy

Presentation By-

Santosh Parashar

Program Co-ordinator (Finance)Institute of Advanced Management &Research, Ghaziabad

E-mail:[email protected]

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Topics CoveredTopics Covered IntroductionIntroduction

Pre-requisites for banking business in IndiaPre-requisites for banking business in India Licensing to Foreign Banks in IndiaLicensing to Foreign Banks in India

Policies adopted by RBI for Foreign banks ; Road MapPolicies adopted by RBI for Foreign banks ; Road Map

Foreign Banks Operation in India; Financial Performance of Foreign BanksForeign Banks Operation in India; Financial Performance of Foreign Banks

ConclusionConclusion

ReferencesReferences

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For the past three decades Indias bankingFor the past three decades Indias bankingsystem has several outstanding achievementssystem has several outstanding achievementsto its credit.to its credit.

The most striking is its extensive reach. It isThe most striking is its extensive reach. It isno longer confined to only metropolitans orno longer confined to only metropolitans orcosmopolitans in India. In fact, Indian bankingcosmopolitans in India. In fact, Indian bankingsystem has reached even to the remotesystem has reached even to the remotecorners of the country.corners of the country.

Thus, Growing Indian economy is the result ofThus, Growing Indian economy is the result ofeffective Indian banking system amongsteffective Indian banking system amongstmany other responsible internal and externalmany other responsible internal and externalfactors, in which the role played by foreignfactors, in which the role played by foreigncommercial banks in the country is also acommercial banks in the country is also acrucial one.crucial one.

Foreign banks likeForeign banks like Citibank, HSBC, StandardCitibank, HSBC, StandardChartered BankChartered Bank, etc are the branches of those, etc are the branches of thosebanks which are incorporated in foreignbanks which are incorporated in foreigncountries. Most of them perform essentiallycountries. Most of them perform essentiallythe same range of services as local banks,the same range of services as local banks,except that their focus in terms of product andexcept that their focus in terms of product andcustomers may be different due to their limitedcustomers may be different due to their limitedbranch network.branch network.

Introduction

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They bring in new technology and facilitate inThey bring in new technology and facilitate inthe introduction as well as assimilation ofthe introduction as well as assimilation ofinternational products into the domesticinternational products into the domesticmarkets.markets.

They help the local banking industry keepThey help the local banking industry keep

pace with developments in the financial pace with developments in the financialcentres abroad. They also help providecentres abroad. They also help provideIndian corporations access to foreign capitalIndian corporations access to foreign capitalmarkets.markets.

In keeping with the general trend towardsIn keeping with the general trend towardsliberalization, the Government hasliberalization, the Government hasintroduced several measures for wideningintroduced several measures for widening

the scope for foreign banks to enter andthe scope for foreign banks to enter andoperate in India.operate in India.

On the one hand if they always brought anOn the one hand if they always brought anexplanation about the prompt services toexplanation about the prompt services tocustomers then on the other hand they offercustomers then on the other hand they offerbiggest competition to the domestic banks inbiggest competition to the domestic banks inIndia.India.

This paper focuses on RBI regulationThis paper focuses on RBI regulation(licensing requirement) for foreign banks,(licensing requirement) for foreign banks,economic contribution and prospects ofeconomic contribution and prospects offoreign Banks in Indian economy.foreign Banks in Indian economy.

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AA foreign bankforeign bank is a bank organized under foreign law and located outside theis a bank organized under foreign law and located outside thecountry of its origin. A foreign bank includescountry of its origin. A foreign bank includes offices, branches, and agenciesoffices, branches, and agenciesof commercial banks or trust companies, private banks, national banks, thriftof commercial banks or trust companies, private banks, national banks, thriftinstitutions, credit unions, and other organizations chartered under bankinginstitutions, credit unions, and other organizations chartered under bankinglaws and supervised by banking supervisors of country of operation.laws and supervised by banking supervisors of country of operation.

AA "foreign bank""foreign bank" does not includedoes not include any foreign central bank or monetaryany foreign central bank or monetaryauthority that functions as a central bank, or any international financialauthority that functions as a central bank, or any international financialinstitution or regional development bank formed by treaty or internationalinstitution or regional development bank formed by treaty or internationalagreement.agreement.

On the basis ofOn the basis ofpurpose to operate,purpose to operate, there arethere are two main typestwo main types of foreign banksof foreign banks

-those that come into developing countries primarily to serve their home-those that come into developing countries primarily to serve their homeclients, the socalledclients, the socalled traditionaltraditionalororclassicalclassicalbanksbanks, and the, and the opportunistopportunist,, whowhocome looking for profit (short or long-run) opportunities in developingcome looking for profit (short or long-run) opportunities in developingcountries.countries.

On the basis ofOn the basis ofchannel to operate /mode of presencechannel to operate /mode of presence, there are, there are three typesthree types ofofforeign Banks- first foreign Banks- first Branches, second -A wholly owned subsidiary (WOS)Branches, second -A wholly owned subsidiary (WOS)and A subsidiary with maximum foreign investment of 74% in a private bank.and A subsidiary with maximum foreign investment of 74% in a private bank.

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Pre-requisites of banking business in IndiaPre-req

uisites of banking business in IndiaIn terms of Sec 22 of the B.R. Act-1949, no company shall carry onIn terms of Sec 22 of the B.R. Act-1949, no company shall carry on

banking business in India, unless it holds a license issued in that behalf bybanking business in India, unless it holds a license issued in that behalf byReserve Bank and any such license may be issued subject to suchReserve Bank and any such license may be issued subject to such

conditions as the Reserve Bank may think fit to impose. Before grantingconditions as the Reserve Bank may think fit to impose. Before granting

any license, RBI may require to be satisfied that the following conditionsany license, RBI may require to be satisfied that the following conditionsare fulfilled:are fulfilled: that the company is or will be in a position to pay its present or future depositorsthat the company is or will be in a position to pay its present or future depositors

in full as their claims accrue;in full as their claims accrue; that the affairs of the company are not being , or are not likely to be, conducted inthat the affairs of the company are not being , or are not likely to be, conducted in

a manner detrimental to the interests of its present or future depositors;a manner detrimental to the interests of its present or future depositors; that the general character of the proposed management of the proposed bank willthat the general character of the proposed management of the proposed bank will

not be prejudicial to the public interest or the interest of its depositors;not be prejudicial to the public interest or the interest of its depositors; that the company has adequate capital structure and earning prospects;that the company has adequate capital structure and earning prospects; that having regard to the banking facilities available in the proposed principalthat having regard to the banking facilities available in the proposed principal

area of operations of the company, the potential scope for expansion of banksarea of operations of the company, the potential scope for expansion of banksalready in existence in the area and other relevant factors the grant of the licensealready in existence in the area and other relevant factors the grant of the licensewould not be prejudicial to the operation and consolidation of the banking systemwould not be prejudicial to the operation and consolidation of the banking systemconsistent with monetary stability and economic growth.consistent with monetary stability and economic growth.

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Licensing to Foreign Banks in IndiaLicensing to Foreign Banks in India

Procedurally, foreign banks are required to apply to RBI for opening theirProcedurally, foreign banks are required to apply to RBI for opening theirbranches in India. Foreign banks application for opening their maidenbranches in India. Foreign banks application for opening their maidenbranch is considered under the provisions of Sec 22 of the BR Act, 1949.branch is considered under the provisions of Sec 22 of the BR Act, 1949.

Before granting any license under this section, RBI may require to beBefore granting any license under this section, RBI may require to besatisfied that the Government or the law of the country in which it issatisfied that the Government or the law of the country in which it isincorporated does not discriminate in any way against banks from India.incorporated does not discriminate in any way against banks from India.

Unlike the restrictive practices of certain foreign countries, India is liberal inUnlike the restrictive practices of certain foreign countries, India is liberal inrespect of the licensing and operation of the foreign bank branches asrespect of the licensing and operation of the foreign bank branches asillustrated by the following:illustrated by the following:

India issues a single class of banking license to banks and henceIndia issues a single class of banking license to banks and hencedoes not place any undue restrictions on their operations merely ondoes not place any undue restrictions on their operations merely onthe ground that in some countries there are requirements of multiplethe ground that in some countries there are requirements of multiplelicenses for dealing in local currency and foreign currencies withlicenses for dealing in local currency and foreign currencies withdifferent categories of clientele.different categories of clientele.

Banks in India, both Indian and foreign, enjoy full and equal accessBanks in India, both Indian and foreign, enjoy full and equal accessto the payments and settlement systems and are full members of theto the payments and settlement systems and are full members of theclearing houses and payments system.clearing houses and payments system.

All banks can carry on both retail and wholesale banking.All banks can carry on both retail and wholesale banking. Deposit insurance cover is uniformly available to all foreign banks atDeposit insurance cover is uniformly available to all foreign banks at

a non-discriminatory rate of premium.a non-discriminatory rate of premium. The norms for capital adequacy, income recognition and assetThe norms for capital adequacy, income recognition and asset

classification are by and large the same. Other prudential normsclassification are by and large the same. Other prudential normssuch as exposure limits are the same as those applicable to Indiansuch as exposure limits are the same as those applicable to Indianbanks.banks.

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Policies adopted by RBI for Foreign banksPolicies adopted by RBI for Foreign banks

The policy for approving foreign banks applications to openThe policy for approving foreign banks applications to openmaiden branch and further expand their branch presencemaiden branch and further expand their branch presencehas been incorporated by RBI in thehas been incorporated by RBI in the Roadmap forRoadmap forpresence of Foreign banks in India indicated in the Presspresence of Foreign banks in India indicated in the Press

Release dated February 28, 2005 as well as in theRelease dated February 28, 2005 as well as in theliberalized branch authorization policy issued onliberalized branch authorization policy issued onSeptember 8, 2005.September 8, 2005.

The branch authorization policy for Indian banks has beenThe branch authorization policy for Indian banks has beenmade applicable to foreign banks subject to the followingmade applicable to foreign banks subject to the followingsteps specified in the roadmap:steps specified in the roadmap:

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Road MAP:Road MAP:Phase I: March 2005 to March 2009Phase I: March 2005 to March 2009

Foreign banks are required to bring an assigned capital of US $25Foreign banks are required to bring an assigned capital of US $25million up front at the time of opening the first branch in India.million up front at the time of opening the first branch in India.

Existing foreign banks having only one branch have to comply with theExisting foreign banks having only one branch have to comply with the

above requirement before their request for opening of second branchabove requirement before their request for opening of second branchare considered. Foreign banks may submit their branch expansion planare considered. Foreign banks may submit their branch expansion planon an annual basis.on an annual basis.

Foreign banks and its groups track record of compliance andForeign banks and its groups track record of compliance andfunctioning in the global markets is considered. Reports from homefunctioning in the global markets is considered. Reports from homecountry supervisors are sought, wherever necessary.country supervisors are sought, wherever necessary.

Weightage is given to even distribution of home countries of foreignWeightage is given to even distribution of home countries of foreign

banks having presence in India. The treatment extended to Indian banksbanks having presence in India. The treatment extended to Indian banksin the home country of the applicant foreign bank is considered .in the home country of the applicant foreign bank is considered . Due consideration is given to the bilateral and diplomatic relationsDue consideration is given to the bilateral and diplomatic relations

between India and the home country.between India and the home country. The branch expansion of foreign banks is considered keeping in viewThe branch expansion of foreign banks is considered keeping in view

Indias commitments at World Trade Organization (WTO). As a part ofIndias commitments at World Trade Organization (WTO). As a part ofmarket access, India is committed to permit opening of 12 branches ofmarket access, India is committed to permit opening of 12 branches offoreign banks every year. As against these commitments, Reserve Bankforeign banks every year. As against these commitments, Reserve Bankof India has permitted up to 17- 18 branches in the past .of India has permitted up to 17- 18 branches in the past .

Licenses issued for off-site ATMs installed by foreign banks are notLicenses issued for off-site ATMs installed by foreign banks are notincluded in the ceiling of 12.included in the ceiling of 12.

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The Reserve Bank follows a liberal policy where the branches areThe Reserve Bank follows a liberal policy where the branches aresought to be opened in unbanked/under-banked areas.sought to be opened in unbanked/under-banked areas.

Permission for conversion of existing branches of a foreign bankPermission for conversion of existing branches of a foreign bankinto a WOS will be guided by the manner in which the affairs of theinto a WOS will be guided by the manner in which the affairs of thebranches of the bank are conducted, compliance with the statutorybranches of the bank are conducted, compliance with the statutory

requirements and the overall supervisory comfort of RBI. Also, forrequirements and the overall supervisory comfort of RBI. Also, forreckoning the minimum net worth the local available capitalreckoning the minimum net worth the local available capitalincluding the remittable surplus retained in India will qualify.including the remittable surplus retained in India will qualify.

In order to allow Indian banks sufficient time to prepare themselvesIn order to allow Indian banks sufficient time to prepare themselvesfor global competition, initially entry of foreign banks will befor global competition, initially entry of foreign banks will bepermitted only in the private sector banks that are identified by thepermitted only in the private sector banks that are identified by theRBI for restructuring. In such banks, foreign banks would beRBI for restructuring. In such banks, foreign banks would be

allowed to acquire a controlling stake in a phased manner.allowed to acquire a controlling stake in a phased manner. RBI will consider the application for acquisition of 5% or moreRBI will consider the application for acquisition of 5% or more

stakes in a foreign bank depending upon the reputation of thestakes in a foreign bank depending upon the reputation of theforeign bank, its desired level of presence in the country and theforeign bank, its desired level of presence in the country and theinterest of the shareholders of the investee bank.interest of the shareholders of the investee bank.

RBI may also specify, if necessary, that the investor bank shallRBI may also specify, if necessary, that the investor bank shallmake a minimum acquisition of 15% or more and the period of timemake a minimum acquisition of 15% or more and the period of time

for such acquisition. The overall limit of 74% will continue to befor such acquisition. The overall limit of 74% will continue to beapplicable.applicable.

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Phase II: April 2009 onwardsPhase II: April 2009 onwards

In the second phase, the removal of limitations on the operations ofIn the second phase, the removal of limitations on the operations ofthe WOS and treating them on par with domestic banks to the extentthe WOS and treating them on par with domestic banks to the extent

appropriate will be designed and implemented after reviewing theappropriate will be designed and implemented after reviewing thesuccess of Phase I.success of Phase I.

The WOS of foreign banks on completion of a minimum prescribedThe WOS of foreign banks on completion of a minimum prescribedperiod of operation will be allowed to list and dilute their stake (by wayperiod of operation will be allowed to list and dilute their stake (by wayof IPO or offer for sale) so that at least 26% of the paid up capital ofof IPO or offer for sale) so that at least 26% of the paid up capital ofthe subsidiary is held by resident Indians.the subsidiary is held by resident Indians.

After a review is made with regard to the extent of penetration ofAfter a review is made with regard to the extent of penetration of

foreign banks in India and their functioning, foreign banks may beforeign banks in India and their functioning, foreign banks may bepermitted, to enter into merger and acquisition transactions with anypermitted, to enter into merger and acquisition transactions with anyprivate sector bank in India subject to the overall investment limit ofprivate sector bank in India subject to the overall investment limit of74%.74%.

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Foreign Banks Operation in IndiaForeign Banks Operation in India

As at June 2009, 32 foreign banks were operating in India with 295As at June 2009, 32 foreign banks were operating in India with 295branchesbranches as compared with 30 foreign banks with 279 branches as atas compared with 30 foreign banks with 279 branches as atend June 2008.end June 2008.

These banks originatedThese banks originated from 23 different countries.from 23 different countries. In addition,In addition, 4343foreign banks operated in India through representative offices.foreign banks operated in India through representative offices.

During the period from July 2008 to June 2009During the period from July 2008 to June 2009 , permission has been, permission has beengrantedgranted to theto the four existing foreign banks to open 12 branchesfour existing foreign banks to open 12 branches and toand tothree new banksthree new banks,, (viz., CIMB Bank Berhad, Malaysia, Commonwealth(viz., CIMB Bank Berhad, Malaysia, CommonwealthBank of Australia and FirstRand Bank Ltd. of south Africa)Bank of Australia and FirstRand Bank Ltd. of south Africa) to open oneto open onemaiden branch each in India.maiden branch each in India.

During the same period, permission was granted to three foreignDuring the same period, permission was granted to three foreignbanksbanks ((viz.viz., Kfw-IPEX Bank GmbH, Toronto Dominion Bank and, Kfw-IPEX Bank GmbH, Toronto Dominion Bank andDuncan Lawrie Ltd.)Duncan Lawrie Ltd.) to open a representative office each in India.to open a representative office each in India.

Three foreign banksThree foreign banks viz., DBS Bank ltd., Deutsche Bank AG andviz., DBS Bank ltd., Deutsche Bank AG andFirstRand Bank Ltd.FirstRand Bank Ltd. together set up 12 branches during July 2008 totogether set up 12 branches during July 2008 toJune 2009. Besides, two foreignJune 2009. Besides, two foreign viz.viz., DnB NOR Bank and KfW IPEX, DnB NOR Bank and KfW IPEXBank GmbHBank GmbH opened a representative office each in India during theopened a representative office each in India during the

same period.same period.

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Offices of Commercial Banks in India-2005-09

Bank Group As on March 31

2005 2006 2007 2008 2009

(1) (2) (3) (4) (5)

State Bank of India and its Associates 14006 14294 14651 15814 16731

Nationalized Banks$ 35096 35848 37413 39204 40766

Foreign Banks 242 259 272 279 295

Regional Rural Banks 14763 14776 14812 15029 15384

Other Scheduled commercial Banks 6462 6828 7415 8294 9186

Non-Scheduled Commercial Banks 37 41 46 46 46

Total 70606 72046 74609 78666 82408

Notes : No. of offices includes administrative offices.$ Includes IDBI Bank Ltd.

Data for 2005 to 2008 have been revised and data for 2009 are provisional.

Source: Master Office File (latest updated version) on commercial banks, Department of Statistics and Information Management, RBI.

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Offices of Com mercial Banks in Ind ia

Nationalize

Banks, 4076

SBI & its

Ass ociates, 167

Foreign Bank

295

Regional Rur

Bank s, 1538

Other Schedule

Com m erc i a lBanks, 9186

Non-Schedule

Com m erc i a l

Bank s, 46

SBI & its A ss ociates

Nationalized Banks

Foreign Bank s

Region al Rural Bank s

Other ScheduledCom m er cial Banks

Non-Scheduled Com m er

Banks

Source: Master Office File (latest updated version) on commercial banks, Department of Statistics and Information Management, RBI

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Fig- OCCUPATION WISE DISTRIBUTION OF CREDIT BY FOREIGN BANKS-2008(AS ON 31ST MARCH)

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Financial Performance of Foreign Banks in India (As on 31st March)

DepositInvestment Advances

2007 2008 2009 2007 2008 2009 2007 2008 2009

150,750 191,443 214,077 71,471 99,092 130,353 126,339 161,959 165,415

Statement II: Foreign Banks in India: Total Assets/Gross NPAs/Net NPAs (Rs. Crore)

Total AssetsGross NPA Net NPA

2007 2008 2009 2007 2008 2009 2007 2008 2009274,392 365,255 447,070 2,263 2,872 6,807 927 1,254 2,973

Statement I: Foreign Banks in India: Deposits/Investments/Advances (Rs. Crore)

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Financial Performance of Foreign Banks in India (As on 31st March)

Statement III: Foreign Banks in India: Income (Rs. Crore)

Interest IncomeOther Income Total Income

2007 2008 2009 2007 2008 2009 2007 2008 2009

17,924 24,422 30,322 7,044 10,616 14,890 24,968 35,037 45,211

Statement IV: Foreign Banks in India: Expenditure (Rs. Crore)

Interest ExpendedOperating Expenses Total Expenditure#

2007 2008 2009 2007 2008 2009 2007 2008 2009

7,603 10,609 12,817 7,745 10,374 12,298 15,348 20,983 25,114

# excludes provisions and contingencies

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Statement V: Foreign Banks in India: Profit (Rs. Crore)

Operating ProfitsProvisions

&ContingenciesNet Profit

2007 2008 2009 2007 2008 2009 2007 2008 2009

9,619 14,054 20,097 5,034 7,441 12,588 4,585 6,613 7,509

Financial Performance of Foreign Banks in India (As on 31st March)

N t P fit T d f F i B k ( 31st M h 2007 t 2009 )

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Net Profit Trend of Foreign Banks(As on 31st March)

4585

6613

7509

0

1000

2000

3000

4000

5000

60007000

8000

1 2 3

years

Netprofi

years

net profit

Net Profit Trend of Foreign Banks (as on 31st March 2007 to 2009 )

44.23%

Growth

13.54%

Growth

By having look on performance of foreign banks in India mentioned inBy having look on performance of foreign banks in India mentioned in

statement I to V it is very clear that theirstatement I to V it is very clear that theirDeposits/Investments/AdvancesDeposits/Investments/Advanceshave increased altogether from year 2007 to 2009have increased altogether from year 2007 to 2009But with the increase in net NPAsBut with the increase in net NPAs (Proportionately more in year 2009)(Proportionately more in year 2009)over the years their net profits has declined in year 2009over the years their net profits has declined in year 2009, as the, as thepercentage increase in net profits in year 2008 was 44.23% whereas inpercentage increase in net profits in year 2008 was 44.23% whereas inyear 2009 it was only 13.54%.year 2009 it was only 13.54%.

(Rs, in Crores)

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Rising non-performing assets, or NPAs, and constraints on capitalRising non-performing assets, or NPAs, and constraints on capitalflows following the global financial turmoil have taken their toll onflows following the global financial turmoil have taken their toll onforeign banks operations in India.foreign banks operations in India.

Banks need capital to expand loan assets, but in many cases,Banks need capital to expand loan assets, but in many cases,

parents of foreign banks operating in India are not in a position toparents of foreign banks operating in India are not in a position toinfuse capital.infuse capital.

Rising NPAs are also discouraging foreign banks from theRising NPAs are also discouraging foreign banks from theaggressive asset creation they pursued in the past few years whenaggressive asset creation they pursued in the past few years whenthe Indian economy was growing at an average pace of 8.5% andthe Indian economy was growing at an average pace of 8.5% andconsumers were buying homes and cars and spending more onconsumers were buying homes and cars and spending more ontheir credit cards.their credit cards.

Banks have to set aside money to cover NPAs, for which theyBanks have to set aside money to cover NPAs, for which theyrequire more capital.require more capital.

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However, by the year 2010, the list of foreign banks in India may becomeHowever, by the year 2010, the list of foreign banks in India may becomemore quantitative as numbers of foreign banks are still waiting withmore quantitative as numbers of foreign banks are still waiting withbaggage to start business in India despite of liquidation decisionbaggage to start business in India despite of liquidation decisiondiscouraging foreign players- like,discouraging foreign players- like, RBS which has 31 branches in IndiaRBS which has 31 branches in Indiaand employs about 10,000 people has already approached the Indianand employs about 10,000 people has already approached the Indian

central bank for approval of liquidation deal andcentral bank for approval of liquidation deal and

The Reserve Bank ofThe Reserve Bank of

India has confirmed that it will require foreign banks to undergo a full auditIndia has confirmed that it will require foreign banks to undergo a full auditof their Indian operations prior to be allowed to establish new branches.of their Indian operations prior to be allowed to establish new branches.

The requirement to audit foreign banks before further expansion is toThe requirement to audit foreign banks before further expansion is topreserve risk management capabilities over concerns that any failurepreserve risk management capabilities over concerns that any failurecould create risks for Indian financial markets.could create risks for Indian financial markets.

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ConclusionConclusion The move to audit foreign banks expansion in India is seen as aThe move to audit foreign banks expansion in India is seen as a

sensible precaution in light of the current global crisis.sensible precaution in light of the current global crisis. Foreign banks committed to making a play in India will need toForeign banks committed to making a play in India will need to

adopt alternative approaches to win the race for the customer andadopt alternative approaches to win the race for the customer andbuild a value-creating customer franchise in advance of regulationsbuild a value-creating customer franchise in advance of regulationspotentially in 2010.potentially in 2010.

At the same time, they should stay in the game for potentialAt the same time, they should stay in the game for potentialacquisition opportunities as and when they appear in the near term.acquisition opportunities as and when they appear in the near term.

Maintaining a fundamentally long-term value-creation mindset willMaintaining a fundamentally long-term value-creation mindset willbe their greatest challenge.be their greatest challenge.

The extent to which Indian policy makers and bank managementsThe extent to which Indian policy makers and bank managementsdevelop and execute such a clear and complementary agenda todevelop and execute such a clear and complementary agenda totackle emerging discontinuities will lay the foundations for a high-tackle emerging discontinuities will lay the foundations for a high-performing sector in 2010.performing sector in 2010.

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References:References:

1.1. Report on Trend and Progress of Banking in India (2008-09),RBIReport on Trend and Progress of Banking in India (2008-09),RBI

Bulletin; Nov.09.Bulletin; Nov.09.2.2. Principles and practices of Banking; IIBF, McMillan reprinted, 2009Principles and practices of Banking; IIBF, McMillan reprinted, 20093.3. http://www.rbi.org.in/scripts/statistics.aspxhttp://www.rbi.org.in/scripts/statistics.aspx4.4. www.legalhelpindia.com/bareACTS/BANKING%20REGULATIONwww.legalhelpindia.com/bareACTS/BANKING%20REGULATION

%20ACT%201949.doc%20ACT%201949.doc5.5. http://www.idlo.int/microfinance/DOCUMENTS/REGULATIONS/INDIA2.http://www.idlo.int/microfinance/DOCUMENTS/REGULATIONS/INDIA2.

pdfpdf

6.6. http://www.mckinsey.com/locations/india/mckinseyonindia/pdf/india_banhttp://www.mckinsey.com/locations/india/mckinseyonindia/pdf/india_banking_2010.pdfking_2010.pdf7.7. http://www.rupeetimes.com/news/personal_loan/foreign_banks_to_recohttp://www.rupeetimes.com/news/personal_loan/foreign_banks_to_reco

nsider_growth_plans_for_india_2390.htmlnsider_growth_plans_for_india_2390.html8.8. http://www.livemint.com/2009/08/02205613/Capital-constraints-rising-http://www.livemint.com/2009/08/02205613/Capital-constraints-rising-

ba.html?d=1ba.html?d=1

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THANK YOUTHANK YOU