Banking Interview Tips

• Read IBPS Clerks II Interview Experiences here (New)

Interview Preparation Tips for IBPS Clerks and LIC ADO Exams

• BeforeInterview Practice • Clothing and Physical Appearance • What to prepare for Bank Interviews ? • Howto Enter the room ? • Duringthe Interview...

o How to Answer the Question "Aren't you Over Qualified for this Job?"

LIC ADO Interview Preparation Materials

• Shortnotes on LIC • Functions of LIC

Interview Experiences of IBPS Clerks

• Read Interview Experiences of IBPS Clerks shared by our friends here

Expected Banking Interview Questions with Answers :

• Banking Interview Expected Questions - Set 1

• Banking Interview Expected Questions - Set 2 • Top 50 Banking Interview Questions - Pdf Download

Important Details of Regional Rural Banks you Must know for IBPS RRB Interviews :

• Important Points you Should Know about Regional Rural Banks

Important Points you Must know for IBPS Clerks Banking Interviews :

• Shortnotes on Banking - Pdf Download • Important Banking Terminology - Pdf File (previously posted for IBPS Clerks Exam) • Current RBI Rates • Complete List of Banking Terminology - Pdf Download • Important Details of The Reserve Bank of India (RBI) • Functions of Commercial Banks • RBI Roles and Functions (Pdf) • Functions and working of RBI (Pdf) • Important Details of SBI (State Bank of India) • Important Details of Nationalized Banks • Important Details of Regional Rural Bank (RRBs) • Important Details of NABARD • Short Notes on ALM (Asset Liability Management) • Introduction to Money • Printing of Currency Notes and Securities • Complete List of Countries and Their Currencies • Important Committees on Indian Banking (Pdf Download) • Indian Coinage Act, 1906 • Basel-I and Basel-II Norms • Complete List of Indian Banks and Their Heads / CEOs / CMDs • Banking Abbreviations • Inflation • Economic Planning in India • Base Rate and Bench Mark Prime Lending Rate • Five Year Plans in India • Foreign Exchange Management Act, 1999 • Programs and Schemes • Union Budget 2013-14 (New Important) • Railway Budget 2013-14 (New Important) • Daily Banking Events and Important Updates

Important points you must know about SBI for SBI Associates Clerical Interviews :

• Short Notes on - State Bank of India (SBI)

Current Affairs for Banking Interviews :

• Download Last 6 Months' Current Affairs in Pdf format here

IBPS PO Interview Details

• Detailed Analysis of IBPS PO Common Interview Process

• IBPS PO Common Interview Experiences

BankingAwareness - Important Points for IBPS Clerks Online Exam Friends, here are some Important Basics you should know about Banking Awareness for upcoming IBPS Clerks Online Exam. In this, we tried to cover almost all the basic terminology of banking awareness in simple language so that you can pick the synopsis in a single glance. It hardly will take 15 to 20 minutes to complete reading this post. But we assure you that it helps you a lot. If you have time, you can refer to our complete short notes on Banking Awareness Here. You can download this post as Pdf file from Here Bank Rate

Bank rate, also referred to as the discount rate, is the rate of interest which a central bank charges on the loans and advances that it extends to commercial banks and other financial intermediaries. Changes in the bank rate are often used by central banks to control the money supply. Present Bank Rate – 9% Repo Rate Repo rate is the rate at which our banks borrow rupees from RBI. Whenever the banks have any shortage of funds they can borrow it from RBI. A reduction in the repo rate will help banks to get money at a cheaper rate. When the repo rate increases, borrowing from RBI becomes more expensive. Present Repo Rate - 8% Reverse Repo Rate This is exact opposite of Repo rate. Reverse Repo rate is the rate at which Reserve Bank of India (RBI) borrows money from banks. RBI uses this tool when it feels there is too much money floating in the banking system. Banks are always happy to lend money to RBI since their money is in safe hands with a good interest. An increase in Reverse repo rate can cause the banks to transfer more funds to RBI due to this attractive interest rates. Present Reverse Repo Rate – 7% CRR Rate Cash reserve Ratio (CRR) is the amount of funds that the banks have to keep with RBI. If RBI decides to increase the percent of this, the available amount with the banks comes down. RBI is using this method (increase of CRR rate), to drain out the excessive money from the banks. Present CRR – 4.25% SLR Rate SLR (Statutory Liquidity Ratio) is the amount a commercial bank needs to maintain in the form of cash, or gold or govt. approved securities (Bonds) before providing credit to its customers. SLR rate is determined and maintained by the RBI (Reserve Bank of India) in order to control the expansion of bank credit. SLR is determined as the percentage of total demand and percentage of time liabilities. Time Liabilities are the liabilities a commercial bank liable to pay to the customers on their anytime demand. SLR is used to control inflation and propel growth. Through SLR rate tuning the money supply in the system can be controlled efficiently. Present SLR – 23% Inflation Inflation is as an increase in the price of bunch of Goods and services that projects the Indian economy. An increase in inflation figures occurs when there is an increase in the average level of prices in Goods and services. Inflation happens when there are fewer Goods and more buyers; this will result in increase in the price of Goods, since there is more demand and less supply of the goods. Deflation Deflation is the continuous decrease in prices of goods and services. Deflation occurs when the inflation rate becomes negative (below zero) and stays there for a longer period.

PLR The Prime Interest Rate is the interest rate charged by banks to their most creditworthy customers (usually the most prominent and stable business customers). The rate is almost always the same amongst major banks. Adjustments to the prime rate are made by banks at the same time; although, the prime rate does not adjust on any regular basis. The Prime Rate is usually adjusted at the same time and in correlation to the adjustments of the Fed Funds Rate. Some banks use the name "Reference Rate" or "Base Lending Rate" to refer to their Prime Lending Rate. Deposit Rate Interest Rates paid by a depository institution on the cash on deposit. FII FII (Foreign Institutional Investor) used to denote an investor, mostly in the form of an institution. An institution established outside India, which proposes to invest in Indian market, in other words buying Indian stocks. FII's generally buy in large volumes which has an impact on the stock markets. Institutional Investors includes pension funds, mutual funds, Insurance Companies, Banks, etc.. FDI FDI (Foreign Direct Investment) occurs with the purchase of the “physical assets or a significant amount of ownership (stock) of a company in another country in order to gain a measure of management control” (Or) A foreign company having a stake in a Indian Company. IPO IPO is Initial Public Offering. This is the first offering of shares to the general public from a company wishes to list on the stock exchanges. Disinvestment The Selling of the government stake in public sector undertakings. Fiscal Deficit It is the difference between the government’s total receipts (excluding borrowings) and total expenditure. Present Fiscal Deficit is 5.3% Revenue deficit It defines that, where the net amount received (by taxes & other forms) fails to meet the predicted net amount to be received by the government GDP The Gross Domestic Product or GDP is a measure of all of the services and goods produced in a country over a specific period; classically a year. GNP Gross National Product is measured as GDP plus income of residents from investments made abroad minus income earned by foreigners in domestic market. National Income

National Income is the money value of all goods and services produced in a country during the year. Per Capita Income The national income of a country, or region, divided by its population. Per capita income is often used to measure a country's standard of living. Vote on Account A vote-on account is basically a statement ,where the government presents an estimate of a sum required to meet the expenditure that it incurs during the first three to four months of an election financial year until a new government is in place, to keep the machinery running. Difference between Vote on Account and Interim Budget Vote-on-account deals only with the expenditure side of the government's budget, an interim Budget is a complete set of accounts, including both expenditure and receipts. SDR The SDR (Special Drawing Rights) is an artificial currency created by the IMF in 1969. SDRs are allocated to member countries and can be fully converted into international currencies so they serve as a supplement to the official foreign reserves of member countries. Its value is based on a basket of key international currencies (U.S. dollar, euro, yen and pound sterling). SEZ SEZ means Special Economic Zone is the one of the part of government’s policies in India. A special Economic zone is a geographical region that economic laws which are more liberal than the usual economic laws in the country. The basic motto behind this is to increase foreign investment, development of infrastructure, job opportunities and increase the income level of the people. Corporate governance The way in which a company is governed and how it deals with the various interests of its customers, shareholders, employees and society at large. Corporate governance is the set of processes, customs, policies, laws, and institutions affecting the way a corporation (or company) is directed, administered or controlled.Is defined as the general set of customs, regulations, habits, and laws that determine to what end a firm should be run. RBI Functions The Reserve Bank of India is the central bank of India, was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934. The Reserve Bank of India was set up on the recommendations of the Hilton Young Commission. The commission submitted its report in the year 1926, though the bank was not set up for nine years.To regulate the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage." Banker to the Government: performs merchant banking function for the central and the state governments; also acts as their banker.Banker to banks: maintains banking accounts of all scheduled banks. Monetary policy

A Monetary policy is the process by which the government, central bank, of a country controls

(i) the supply of money, (ii) (ii) availability of money, and (iii) (iii) cost of money or rate of interest,

In order to attain a set of objectives oriented towards the growth and stability of the economy. Fiscal Policy Fiscal policy is the use of government spending and revenue collection to influence the economy. These policies affect tax rates, interest rates and government spending, in an effort to control the economy. Fiscal policy is an additional method to determine public revenue and public expenditure. Core Banking Solutions Core banking is a general term used to describe the services provided by a group of networked bank branches. Bank customers may access their funds and other simple transactions from any of the member branch offices. It will cut down time, working simultaneously on different issues and increasing efficiency. The platform where communication technology and information technology are merged to suit core needs of banking is known as Core Banking Solutions. Bank, its Features and Types A bank is a financial organization where people deposit their money to keep it safe.Banks play an important role in the financial system and the economy. As a key component of the financial system, banks allocate funds from savers to borrowers in an efficient manner. Regional Rural Banks were established with an objective to ensure sufficient institutional credit for agriculture and other rural sectors. The RRBs mobilize financial resources from rural / semi-urban areas and grant loans and advances mostly to small and marginal farmers, agricultural labourers and rural artisans.

(i) The area of operation of RRBs is limited to the area as notified by GoI covering one or more districts in the State.

(ii) ii. Banking services for individual customers is known as retail banking. (iii) iii. A bank that deals mostly in but international finance, long-term loans for companies and

underwriting. Merchant banks do not provide regular banking services to the general public (iv) iv. Online banking (or Internet banking) allows customers to conduct financial transactions

on a secure website operated by their retail or virtual bank. (v) v. Mobile Banking is a service that allows you to do banking transactions on your mobile

phone without making a call , using the SMS facility. Is a term used for performing balance checks, account transactions, payments etc. via a mobile device such as a mobile phone.

(vi) vi. Traditional banking is the normal bank accounts we have. Like, put your money in the bank and they act as a security and you will get only the normal interests (decided by RBI in our case, FED bank in US).

(vii) vii. Investment banking is entirely different. Here, people who are having so much money (money in excess which will yield only less interest if in Banks) will invest their money and get higher returns. For example, If i have more money instead of taking the pain of investing in share market, buying properties etc. I will give to investment banks and they will do the money management and give me higher returns when compared to traditional banks. E-Governance

E-Governance is the public sector’s use of information and communication technologies with the aim of improving information and service delivery, encouraging citizen participation in the decision-making process and making government more accountable,transparent and effective. Right to information Act The Right to Information act is a law enacted by the Parliament of India giving citizens of India access to records of the Central Government and State overnments.The Act applies to all States and Union Territories of India, except the State of Jammu and Kashmir - which is covered under a State-level law. This law was passed by Parliament on 15 June 2005 and came fully into force on 13 October 2005. Credit Rating Agencies in India The credit rating agencies in India mainly include ICRA and CRISIL. ICRA wasformerly referred to the Investment Information and Credit Rating Agency of India Limited. Their main function is to grade the different sector and companies in terms of performance and offer solutions for up gradation. The credit rating agencies in India mainly include ICRA and CRISIL(Credit Rating Information Services of India Limited) Cheque Cheque is a negotiable instrument instructing a Bank to pay a specific amount from a specified account held in the maker/depositor's name with that Bank.A bill of exchange drawn on a specified banker and payable on demand.“Written order directing a bank to pay money”. Demand Draft A demand draft is an instrument used for effecting transfer of money. It is a Negotiable Instrument. Cheque and Demand-Draft both are used for Transfer of money. You can 100% trust a DD. It is a banker's check. A check may be dishonored for lack of funds a DD can not. Cheque is written by an individual and Demand draft is issued by a bank. People believe banks more than individuals. NBFC A non-banking financial company (NBFC) is a company registered under the Companies Act, 1956 and is engaged in the business of loans and advances, acquisition of shares/stock/bonds/debentures/securities issued by government, but does not include any institution whose principal business is that of agriculture activity, industrial activity, sale/purchase/construction of immovable property. NBFCs are doing functions akin to that of banks; however there are a few differences:

(i) (i)A NBFC cannot accept demand deposits (demand deposits are funds deposited at a depository institution that are payable on demand -- immediately or within a very short period -- like your current or savings accounts.)

(ii) it is not a part of the payment and settlement system and as such cannot issue cheques to its customers; and

(iii) Deposit insurance facility of DICGC is not available for NBFC depositors unlike in case of banks. Diff between banking & Finance Finance is generally related to all types of financial, this could be accounting, insurances and policies. Whereas banking is everything that happens in a bank only.The term Banking and

Finance are two very different terms but are often associated together. These two terms are often used to denote services that a bank and other financial institutions provide to its customers. NASSCOM The National Association of Software and Services Companies (NASSCOM), the Indian chamber of commerce is a consortium that serves as an interface to the Indian software industry and Indian BPO industry. Maintaining close interaction with the Government of India in formulating National IT policies with specific focus on IT software and services maintaining a state of the art information database of IT software and services related activities for use of both the software developers as well as interested companies overseas. Mr. Som Mittal – President Chairman - Natarajan Chandrasekaran ASSOCHAM The Associated Chambers of Commerce and Industry of India (ASSOCHAM), India's premier apex chamber covers a membership of over 2 lakh companies and professionals across the country. It was established in 1920 by promoter chambers, representing all regions of India. As an apex industry body, ASSOCHAM represents the interests of industry and trade, interfaces with Government on policy issues and interacts with counterpart international organizations to promote bilateral economic issues. President-Rajkumar Dhoot NABARD NABARD was established by an act of Parliament on 12 July 1982 to implement the National Bank for Agriculture and Rural Development Act 1981. It replaced the Agricultural Credit Department (ACD) and Rural Planning and Credit Cell (RPCC) of Reserve Bank of India, and Agricultural Refinance and Development Corporation (ARDC). It is one of the premiere agency to provide credit in rural areas. NABARD is set up as an apex Development Bank with a mandate for facilitating credit flow for promotion and development of agriculture, small-scale industries, cottage and village industries, handicrafts and other rural crafts. SIDBI The Small Industries Development Bank of India is a state-run bank aimed to aid the growth and development of micro, small and medium scale industries in India. Set up in 1990 through an act of parliament, it was incorporated initially as a wholly owned subsidiary of Industrial Development Bank of India. SENSEX and NIFTY SENSEX is the short term for the words "Sensitive Index" and is associated with the Bombay (Mumbai) Stock Exchange (BSE). The SENSEX was first formed on 1-1-1986 and used the market capitalization of the 30 most traded stocks of BSE. Where as NSE has 50 most traded stocks of NSE. SENSEX IS THE INDEX OF BSE. AND NIFTY IS THE INDEX OF NSE. BOTH WILL SHOW DAILY TRADING MARKS. Sensex and Nifty both are an "index”. An index is basically an indicator it indicates whether most of the stocks have gone up or most of the stocks have gone down. SEBI

SEBI is the regulator for the Securities Market in India. Originally set up by the Government of India in 1988, it acquired statutory form in 1992 with SEBI Act 1992 being passed by the Indian Parliament. Chaired by U.K. Sinha. Mutual funds Mutual funds are investment companies that pool money from investors at large and offer to sell and buy back its shares on a continuous basis and use the capital thus raised to invest in securities of different companies. The mutual fund will have a fund manager that trades the pooled money on a regular basis. The net proceeds or losses are then typically distributed to the investors annually. Asset Management Companies A company that invests its clients' pooled fund into securities that match its declared financial objectives. Asset management companies provide investors with more diversification and investing options than they would have by themselves. Mutual funds, hedge funds and pension plans are all run by asset management companies. These companies earn income by charging service fees to their clients. Non-perfoming assets Non-performing assets, also called non-performing loans, are loans,made by a bank or finance company, on which repayments or interest payments are not being made on time. A debt obligation where the borrower has not paid any previously agreed upon interest and principal repayments to the designated lender for an extended period of time. The nonperforming asset is therefore not yielding any income to the lender in the form of principal and interest payments. Recession A true economic recession can only be confirmed if GDP (Gross Domestic Product)growth is negative for a period of two or more consecutive quarters. Foreign exchange reservers Foreign exchange reserves (also called Forex reserves) in a strict sense are only the foreign currency deposits and bonds held by central banks and monetary authorities.However, the term in popular usage commonly includes foreign exchange and gold,SDRs and IMF reserve positions. IMF The International Monetary Fund (IMF) is an international organization that oversees the global financial system by following the macroeconomic policies of its member countries, in particular those with an impact on exchange rates and the balance of payments. It is an organization formed to stabilize international exchange rates and facilitate development. Managing Director. Christine Lagarde

Current RBI Rates for IBPS Clerks Online Exam Friends, here is the table of present RBI Rates for Upcoming IBPS Clerks Exam. Try to remember these values as its very important in Banking Awareness section of IBPS.

RBI Current Rates for IBPS Clerks Online Exam

Rates % w.e.f.

Bank Rate 9.00% 17.04.2012

Repo Rate 8.00% 17.04.2012

Rev. Repo Rate

7.00% 17.04.2012

C R R 4.25% 03.11.2012

S L R 23.00% 11.08.2012

Base Rate 10-10.5 % --------

PLR 12-15 % --------

Deposit Rate 8.00-9.25% --------

Saving Bank

Deregulated

25.10.2011

Banking Awareness for Bank Exams

Reserve Bank of India (RBI) RBI, India's Central Bank came into existence on 1stApril 1935 as a private share holders bank. Note : 1st Central Bank in the world : Rick's Bank Sweden in 1656. But in the light of unctions, Bank of England is the 1st Central Bank 1694. Functions of RBI :

• Monopoly of Note issue • Banker, Adviser and Agent to the Govt. of India • Banker to Banks • Custodian of Foreign exchange and gold. • Re-discounts bills of exchange and hundis. • Lender of last Resort • Maintains stability of foreign value of Rupee. • Acts as clearing house • Credit control

Here are some important points to remember about RBI :

• RBI's central office is in Mumbai. • RBI has 22 regional offices. • It was nationalized on 1st January 1949. • It prints Currency in 15 Languages. • Its predecessor was Imperial Bank of India (1921). • RBI came into existence on the recommendation of Hilton Young (Royal)

commission as per RBI act 1934. • It is the member bank of Asian Clearing Union (ACU) and IMF (International

Monetary Fund). • RBI has Board of Directors with 20 (Governor and 4 Deputy Governors etc) • The present Governor of RBI is Duvvuri Subba Rao (Second Time).

o Deputy Governors : Anand SInha Subir Gokarn

K.C.Chakravarthi Harun Rashid Khan.

• Currency notes are issued by RBI under "Minimum Reserve System 1957" with backing of Rs. 200 Cr Reserve (Gold : Rs. 115 Cr + Foreign Securities Rs. 85 Cr)

• RBI Invests foreign exchange reserves in multi-currency, multi-market portfolios such as securities, other central banks and Bank of International Settlements (BIS) and deposits in foreign commercial banks. The yield on such investments is low.

• RBI does not pay interest on Govt. deposits with it. • The following monetary instruments are in the hands of RBI to control credit and to

bring economic stability in the economy : o Bank Rate : Rate of rediscount at which the RBI discounts the first class bills

of exchange brought by the banks. o Repo Rate : Injection of liquidity by the RBI is termed as " Repo Rate" . This

was introduced in Dec. 1992 and Reverse Repo Rate in Nov. 1996. RBI buys Govt. Securities for a short period usually a fortnight, with an agreement to sell it later. Thus repo rate is a short-term money market instrument to stabilize short term liquidity in the economy.

o Reverse Repo Rate Repo Rate is the rate at which the RBI lends to commercial banks

where as the Reverse Repo Rate is the rate at which the RBI borrows from the commercial banks against securities for a very short period.

Repo and Reverse Repo rates are used as policy instruments for day-to-day liquidity management under the liquidity adjustment facility.

o Cash Reserve Ratio (CRR) : It refers to the percentage of net demand and time deposits which the scheduled commercial banks have to keep with RBI at zero interest Rate as per RBI act 1934.

o Statutory Liquidity Ratio (SLR) : It refers to the percentage of net demand and time deposits which the scheduled commercial banks have to keep with themselves. i.e. by purchasing Govt. Securities or in the form of cash or gold as per Banking Regulation Act 1949, Sec 24.

SLR is a mechanism used by Commercial Banks for providing credit to the Govt.

o Open market operations : RBI buys or sells Govt. Bonds in the second Ratio.

• RBI Amendment Bill 2005 provides flexibility to RBI in fixing the CRR and SLR. • Though RBI is responsible for the safety and stability of the Banking sector, it is not

legally independent.

Functions of Commercial Banks - Banking Awareness for IBPS Online Exam Friends, we hope all of you are preparing well for the upcoming IBPS Clerks Online Exam. Today, we are going to teach you a very important topic of Banking Awareness. The functions of Commercial Banks. This post will teach you about the basic functions (both

primary and secondary) of the Commercial Banks. We advise you to read our previous posts of Banking Awareness here before going to read this post. All the best :)

Functions of Commercial Banks :

Wecan divide the main functions of the commercial Banks into tow categories. Those are Primary functions and Secondary functions. Primary Functions are the functions the bank SHOULD do to be called as a Bank. And the secondary functions are the functions which are also performed by the Bank. You can get the Complete details Below.

Primary Functions of Commercial Banks - Banking Awareness for IBPS In this post we shall discuss about the Primary Functions of Commercial Banks (Read the Basics Here)

The primary functions of a commercial bank are :

a) Accepting deposits; and b) Granting loans and advances

Now lets have a detailed analysis of these functions. a) Accepting deposits The most important activity of a commercial bank is to mobilise deposits from the public. People who have surplus income and savings find it convenient to deposit the amounts with banks. Depending upon the nature of deposits, funds deposited with bank also earn interest.

Thus, deposits with the bank grow along with the interest earned. If the rate of interest is higher, public are motivated to deposit more funds with the bank. There is also safety of funds deposited with the bank. b) Grant of loans and advances The second important function of a commercial bank is to grant loans and advances (you can get the detailed explanation of these terms below). Such loans and advances are given to members of the public and to the business community at a higher rate of interest than allowed by banks on various deposit accounts. The rate of interest charged on loans and advances varies depending upon the purpose, period and the mode of repayment. The difference between the rate of interest allowed on deposits and the rate charged on the Loans is the main source of a bank’s income. Loan : A loan is granted for a specific time period. Generally, commercial banks grant short-term loans. But term loans, that is, loan for more than a year, may also be granted. The borrower may withdraw the entire amount in lumpsum or in installments However, interest is charged on the full amount of loan. Loans are generally granted against the security of certain assets. A loan may be repaid either in lumpsum or in installments. Advance An advance is a credit facility provided by the bank to its customers. It differs from loan in the sense that loans may be granted for longer period, but advances are normally granted for a short period of time. Further the purpose of granting advances is to meet the day to day requirements of business. The rate of interest charged on advances varies from bank to bank. Interest is charged only on the amount withdrawn and not on the sanctioned amount.

Secondary Functions of Commercial Banks - Banking Awareness for IBPS We've already discussed about the Primary Functions of Commercial Banks (you can read that post here). Now we shall discuss the secondary functions of Commercial Banks.

Secondary functions of Commercial Banks

Besides the primary functions of Accepting deposits and Lending money, banks perform a number of other functions which are called secondary functions. Those functions are.....

1. Issuing letters of credit, travelers cheques, circular notes etc. 2. Undertaking safe custody of valuables, important documents, and securities by

providing safe deposit vaults or lockers; 3. Providing customers with facilities of foreign exchange. 4. Transferring money from one place to another; and from one branch to another

branch of the bank. 5. Standing guarantee on behalf of its customers, for making payments for

purchase of goods, machinery, vehicles etc. 6. Collecting and supplying business information; 7. Issuing demand drafts and pay orders; and, 8. Providing reports on the credit worthiness of customers.

State Bank of India (SBI) In this post, we shall discuss about the India's oldest, largest and most successful commercial bank State Bank of India (SBI). This post is very useful for those people who are preparing for Bank Exams (IBPS and SBI).

• Imperial Bank of India was created in Jan 1921, by amalgamation of three presidency banks, those are

1. Bank of Bengal 2. Bank of Bombay 3. Bank of Madras

• After natilnalization in 1955, the imperial Bank of India was named as State Bank of India (SBI).

• SBI has 7 subsidiaries, They are

1. State Bank of Hyderabad 2. State Bank of Mysore 3. State Bank of Indore 4. State Bank of Patiala 5. State Bank of Saurastra 6. State Bank of Travancore 7. State Bank of Bikaner & Jaipur

All These were formed in 1959 o State Bank of Saurashtra and State Bank of Indore were merged with SBI.

State Bank of Indore merged on 26th August 2010 with SBI. SO the total no. of associate banks of SBI currently working in the country is 5.

SBI is the largest commercial bank in India. SBI launched a new scheme "Parivarthan" to attract more customers by rendering better services. Govt of India's holding in SBI is reduced From 55% to 51%. SBI is to acquire Rupali Bank of Bangladesh and Giro Comercial Bank of Kenya. SBI launched a "Crore Pathi Only" branch in Hyderabad. The criterion to open an account is the minimum opening balance of as one Crore. SBI and Bharathi Airtel entered into MOU on 13th Jan 2011 to from joint venture to make available banking services to the uncovered population of the country with Rs. 100 Cr. investment. This joint venture will become business correspondent of SBI, In this , SBI has 51% state. SBI has 137 foreign offices in 32 countries across the globe. SBI has about 27,000 ATMs as on March 2011. SBI group including associate banks has about 45,000 ATMs. SBI has 21,500 branches including associate banks. SBI has 99,345 offices in India. SBI is the first Bank to open its branch in China. Green Banking Channel is started by SBI. SBI is the first bank to work as Registrar for the "Unique Identification Authority of India". SBI is the 2nd largest commercial Bank in the world in number of Branches (First is ICBC of China). Headquarters of SBI : Mumbai Stock Exchanges of SBI : Mumbai, Kolkata, Chennai, Ahmedabad, Delhi, New York, London. Chairman : Pratip Chaudhuri Revenue : US$ 32.44 billion Profit : US $ 2.34 billion

Total equity : US $ 18.71 billion. Total Employees : 222,933 (by 2011)

Nationalized Banks - Important Info In this post we shall discuss about some important points about Nationalized Banks. Which are useful for all Bank Exams.

• Allahabad Bank is the Oldest Joint Stock Bank of India. • Andhra Bank was the bank founded by a Freedom Fighter Dr. Bhogaraju Pattabhi

Seetaramayya. • Bank of India was the first bank to open branch outside India (in London, 1946) • Canara Bank is the bank to be given an ISO 9002 certificate for one of its branches. • The postal department has issued a commemorative stamp in the name of Central

Bank of India celebrating 100 years in 2011. • Central Bank of India is the First Indian Bank to be wholly owned by Indians. • Punjab National Bank is the bank fromed on the efforts of Lala Lajpat Rai. • Syndicate Bank is the bank whose brand equity is "Pygmy Deposit Scheme". • UCO Bank is the bank which was conceived by Shri GD Birla. • Union Bank of India is the bank which was inaugurated by Mahatma Gandhi (in

1919). • SBI is the largest commercial bank in India. • 1st purely indian bank was the Oudh commercial bank with limited liability by the

Indian Board. • Punjab National Bank was the first Indian bank with unlimited liabilty (estd in 1984). • SBI launched a new scheme "Parivarthan" to attract more customers by rendering

better services. • Govt. of India's holding in SBI is reduced from 55% to 51% in August 2010. • ICICI bank is the largest private sector bank and 1st Universal Bank in India. • ICICI bank is the 1st bank to have crossed Rs. One Trillion market valuation. • SBI launched a "Crore Pathi Only" branch in Hyderabad (Andhra Pradesh). The

criterion to open an account is the minimum opening balance of as One Crore. • Bank of Baroda has largest number of branches abroad. Its punchline is "India's

International Bank"

Now Lets have a look at the punchlines of other Nationalized Banks Name of the Bank Head Office Punchline

Allahabad Bank Kolkata A Tradition of Trust Andhra Bank Hyderabad Much more to do with you in focus Bank of Baroda Baroda India’s international Bank Bank of India Mumbai Relationship beyond Banking Bank of Maharashtra Pune One Family, One Bank Canara Bank Bengaluru We are Changing for you Central Bank of India Mumbai Central to you Since 1911 Corporation Bank Mangalore Sarve Janah Sukhino Bhavantu

(Prosperity to All)

Dena Bank Mumbai Trusted Family Bank Indian Bank Chennai Taking Banking Technology to the

Common Man Indian Overseas Bank Chennai Good People to Grow with Oriental Bank of Commerce New Delhi Where Every Individual is

Committed Punjab and Sindh Bank New Delhi Where Service is a way of Life Punjab National Bank New Delhi The nae you can bank upon Syndicate Bank Manipal Faithful, Friendly Union Bank of India Mumbai Good People to bank with UCO Bank Kolkata Honours yours trust Vijaya Bank Bangalore A friend you can bank upon

Regional Rural Banks (RRBs) Here are some Important points about Regional Rural Banks (RRBs). It'll hardly take 5 mins to read and remember these points. But are important for all Banking Exams. Have a Look at these.....

• Established on 2nd October 1975 on the recommendation of R. G. Sarayya Committee.

• To extend finance to Rural Areas.

• RRBs paid-up capital : Centre 50%; State 15%; Sponsoring Bank 35%

• No new RRB was established since April 1987 (as recommended by Vijay Kelkar Committee)

• At present, there are 82 RRBs in the country, after mergers with 15,612 branches.

• Profit Making RRBs : 80

• Loss Making RRBs : 6; o by 31.03.2009 according to RBI report.

• Bhandari Commission was related to the reconstruction of RRBs

NABARD Here are some useful details about National Bank for Agriculture and Rural Development (NABARD) :

• Established on 12th July 1982 on the recommendation of CRAFICARD committee (also called as Sivaraman Comittee)

o CRAFICARD - Committee for review of arrangements for institutional credit for agriculture and rural development.

• For Agricultural finance, NABARD is the apex organization o Chairman : Prakash Bhakshi o Head Quarters : Mumbai

• It assists Cooperative Banks, RRBs, Land Development Banks & Scheduled Commercial banks in lending to farmers, rural artisans and other non-farmers in rural areas and to the State Governments for minor irrigation.

• Land Development Banks are now called State Co-op. Agricultureal and Rural Development Banks.

• NABARD grants short-term loans for 18 months for seasonal agricultural operations. It only refinances.

• It meets the credit needs of farmers, rural artisans through the above organizations for financing minor irrigation, SHGs, SGSRY, Wasterland Development, Horticulture, Land Development, Farm Mechanization, Animal Husbandry, Fisheries etc. at 6.75% Interest.

• NABARD manages Financial Inclusion Fund.

• Rural Infrastructure Development Fund (RIDF) is operated by NABARD, instead in April 1995.

• NABARD is the "Micro-Finance Regulatory Authority"

• Water Shed Development Fund was instituted with NABARD. • The Government of India holds 99% stake. in NABARD and currently 1% is

held by the Reserve Bank of India. Initially, the RBI used to held 72.5 per cent of equity in NABARD but from October, 2012 the Reserve Bank of India (RBI) has divested 71.5 per cent stake amounting to Rs 1,430 crore in National Bank for Agriculture and Rural Development (NABARD) in favour of the government.

• 2009-10 budget allotted Rs. 14,00 Cr. under RIDF XV tranch + Rs. 4000 Cr. to Rural roads.

• NABARD replaced the Agricultural Credit Department (ACD) and Rural Planning and Credit Cell (RPCC) of Reserve Bank of India, and Agricultural Refinance and Development Corporation (ARDC).

• 2010-11 Budget allots Rs. 400 Cr. for Micro - Finance Eqity Fund. • NABARD completed its 30 years on 12th July, 2012.

• Government of India is planning to take NABARD and National Housing Bank for Rs. 1,900 Cr.

Shortnotes on ALM (Asset Liability Management) - Banking Basics for SBI and IBPS Common Interviews Friends, here is a detailed shortnotes on the strategic management tool of Banking Industry, ALM (Asset Liability Management). You can read our detailed guide for banking interview preparation which help you for SBI Associates Clerks, IBPS RRB and IBPS Common Interviews Here. What is ALM ? The full form of ALM is Asset Liability Management. This is the process of managing risks that arise due to mismatches between the assets and liabilities (debts and assets in simple words) of the bank. Here goes the technical definition of ALM.

The ALM is a comprehensive and dynamic framework for measuring, monitoring and managing the market risk of a bank. It is the management of structure of balance sheet (liabilities and assets) in such a way that the net earning from interest is maximized within the overall risk-preference (present and future) of the institutions. Scope of ALM The ALM functions extend to liquidly risk management, management of market risk, trading risk management, funding and capital planning and profit planning and growth projection. Residual maturity Residual maturity is the time period which a particular asset or liability will still take to mature i.e. become due for payment (once at a time, say in case of a term deposit or in instalments, say in case of term loan). Maturity Buckets Maturity buckets are different time intervals (8 for the time being, namely 1-14 days, 15-28, 29-90, 91-180, 181-365 days, 1-3 years, 3-5 and above 5 years), in which the value of a particular asset or liability is placed depending upon its residual maturity. Mismatch position When in a particular maturity bucket, the amount of maturing liabilities or assets does not match, such position is called a mismatch position, which creates liquidity surplus or liquidity crunch position and depending upon the interest rate movement, such situation may turnout to be risky for the bank. The mismatches for cash flows for 1-14 days and 15-28 days’ buckets are to be kept to the minimum (not to exceed 20% each of cash outflows for those buckets). Role of ALCO

Asset-Liability Committee is the top most committee to oversee implementation of ALM system, to be headed by CMD or ED. ALCO would consider product pricing for both deposits and advances, the desired maturity profile of the incremental assets and liabilities in addition to monitoring the risk levels of the bank. It will have to articulate current interest rates view of the bank and base its decisions for future business strategy on this view. Benefits of ALM As we've discussed above, ALM is a tool that enables bank managements to take business decisions in a more informed framework with an eye on the risks that bank is exposed to. It is an integrated approach to financial management, requiring simultaneous decisions about the types of amounts of financial assets and liabilities - both mix and volume - with the complexities of the financial markets in which the institution operates. Thats all for now friends. In our next post, we shall discuss some more important points for bank interviews. All The Best.

Money Money, a wonderful term. I don't think that I should explain more about It. But here are some important points which are useful for Banking Exams.

Functions of Money :

Money is what money does. Money discharges Five functions.

1. Medium of Exchange 2. Measure of Value 3. Store of Value 4. Standard of Deferred Payments. 5. Transfer of Value

Some more important points about Money are....

• RBI deals with three monetary aggregates. M1, M2 and M3. • M1 and M3 are known as "Narrow Money" and "Broad Money" respectively.

M4 is dropped.

• M0 is reserve money ; M0 = Currency in circulation + Other deposits with RBI + Cash Reserves.

• M3 growth in India is 17% for 2009-10. M3 = M1 + Net time deposits of Banks.

• Decimal system of Coinage started in India on 1st April 1957. • Rs 2 and above currency and coins are issued by RBI but printing of Rs 1, 2

and 5 notes were discontinued. • Currency notes by RBI are issued as per Minimum Reserve System 1957

according to which Rs 115 Cr. worth Gold and Rs 85 Cr. worth Foreign securities to be kept as reserve.

• Paper Currency was introduced in India in 1882. • Indian Rupee Coin was introduced during the regin of Sher Shah Suri (1484 -

1545 AD). • Barter system existed in ancient times which means exchange of goods and

services for goods and services. • There are 15 languages on 10 Rupee Note. 1000 Rupee currency notes are in

circulation since Oct 9th 2000 after gap of 22 years. Parliament approved the mining of Rs 1000 coin on 11th August 2011. Coins of Rs 2 and Rs 5 are in circulation since 1990.

• Indian Rupee is a token money. Indian rupee is accepted as legal tender in Nepal and Bhutan.

• Y.V.Reddy, RBI working group on money supply, has introduced a new concept "Liquid measures i.e., L1, L2, L3 on 23-06-1998.

Printing of Currency Notes and Securities

• Currency Notes Press, Nasik Road - Denomination of Rs.1, 2, 4, 10 , 50 and 100.

• Printing of 1, 2, 5, Notes Discontinued. • Bank Notes Press, Dewas (MP) : Rs 20, 50, 100, 500 and 1000. • Modernized currency notes Press at Mysore, Salboni (West Bengal) • Minting of Coins : Mumbai, Kolkata, Hyderabad, Noida (UP). • Indian Security Press, Nasik Road : Printing of Postal Stamps, Postal material,

Judicial, Non-Judicial Stamps, Cheques, Bonds, NSCs, Indira Vikas Patra, Kisan Vikas Patra, Securities of States and PSUs.

• Security Press Hoshingabad (MP) : Bank and Currency Notes Paper.

• Security Printing Press Hyderabad (Established in 1982) : Printing of Court Fee Stamps, Commemorative Stamps, kisan Vikas Patra, NSS Certificates.

• RBI is going to release plastic notes of Rs. 10. • Coins below 50 paise cease to be legal with effect from 30-06-11. • Symbol given to Indian Rupee • Oldest currency symbol is £ (Pound Sterling) 8th Century AD. • "Smart Money" is a term used for "Credit Card" • "Piggy Banking" is a form of small savings account, popular among poor and

Children. • Near Money also know as "Quasi - Money" is an asset which fulfills the store

of value function and can readily be converted into medium of Exchange. o Ex : Bill of Exchange, Treasury Bills, Bonds, Debentures... o "Demonetization" was done twice in India in 1946 and in 1978. o High powered Money (H-Money) = Demand deposits with Banks +

Cash Held by the Public

Countries and Currencies In this post we shall discuss about different Countries and their Currencies. This information is very important for Banking Exams...

Country Currency Afghanistan Afghani Argentina Austral (Peso) Australia Dollar

Bangladesh Taka Belgium Franc Brazil Cruzeiro Bulgeria Leva Canada Dollar Ceylon Rupee Chile Peso China Yuan Columbia Peso Costa Rica Colon Czechosolovakia Koruna Denmark Krone Ethiopia Dollar Finland Markka France Franc Germany Deutsche Mark Greece Drachma Guyana Dollar Hungary Fonint Hong Kong Dollar India Rupee Indonesia Rupaiah Iran Rial Iraq Dinar Israel Israeli Shequel Italy Lira Iceland Krona Japan Yen Jordan Dinar Korea Won Lebanon Pound Myanmar Kyat Namibia Rand Netherlands Guilder New Zealand Dollar Norway Krone Pakistan Rupee Peru Sole Philippines Peso Poland Zloty Portugal Escudo Russia Rouble Romania Leu South Africa Rand Spain Peseta Switzerland France Thailand Baht Turkey Lira U.K Pound U.A.E Dirhma Uruguay Peso

U.S.A Dollar Venezuela Bolivar Vietnam Dong Yogoslavia `Dinar

Basel -I and Basel II Norms Here are some important points about Basel -I and Bales - II Norms.

• Bank for International Settlements (1930) is at Basel, Switzerland, acts as a coordinating agency for Inter - Central bank dealings and for settling balance of payments imbalances.

• RBI is a member in BIS since 9th September 1996. • These norms come under Basel accord for the regulation of Banks set by the Basel

committee mainly to protect the interest of deposits. • Basel - I accord is accountable to two risks

o Credit Risk o Market Risk

• The Basel - II accord is for "Operational Risk" • Basel - II accord's norms

o Minimum Capital Requirement o Supervisory Review process o Market Discipline

• Basel - III, Requires bank to raise the amount of common equivity that it holds, to 7% of assets from the present 2% requirement.

• Basel Committee revised the guidelines in June 2001, known as Basel II norms. • Under Basel - II norms, 8% is the prescribed capital adequacy ratio. • Basel - II norms as prescribed by RBI to various categories of Banks as follows:

o CAR for Scheduled Commercial Banks (SCBs) -------------- 9 % o New Private sector Banks ----------------------------------- 10 % o Banks with Insurance Business -------------------------------- 10 % o Local area Banks --------------------------------------------- 15 %

• To achieve financial inclusion, Banks Started "No Frills accounts" under saving account. (Frills means, unnecessary features). Initial Balance may be Rs.5 or Zero to open this account.

• 2010 - 2011 Budget proposes to extend Banking, Insurance, and other financial services to those in more than 2000 population villages in 2 Years.

• World Bank to give two Banking sector support loans of Rs.3.2 Billion. • Pranab Mukherjee, Finance Minister won the 2010 Year's "Finance Minister of the year for

Asia award. He was also rated one of the Best Finance Ministers, in the world 1984.

• Yogesh Agarwal is the Chairman, Pension Fund Regulatory and Development Authority (PFRDA).

Tier I Capital :

• At Present, the core Tier I capital requirement is 2% Basel committee requires the Banks to raise their top quality capital known as core Tier I, to 7% of their risk bearing assets by 2019.

• Basel III norms announced last month by the Basel Committee required the above. • Govt. recapitalizing the PSBs in 2009-2010 and 2010-2011 to enable them to maintain capital

to risk-weighted asset ratio of 12%. • This recapitalization aims to improve Tier-I capital of PSBs, while RBI fixed 9% CRAR, the

Govt, wants to further strengthen PSBs by adopting 12% CRAR.

Inflation Persistent rise in the general price level or "fall in the value of money" is called inflation. Have a look at some important points about Inflation.

• Price Level and purchasing power or value of money are inversely related. • Changes in price level are measured in terms of whole-sale price (WPI) Index. • WPI is released by the Department of Industrial Policy and Promotion. • WPI is constructed weekly since 1942 and shifted to monthly in Nov. 2009. • M.C.Singh is the Economic Advisor, Ministry of Committee and Industry. • The present no. of commodities in WPI in 4385, it increased to 676 items. • With effect from Sep. 14 2010, new series of WPI base year 2004-05, replaced 1993-94 base

year series. Highest weight in this Index is given to manufactured items. • Abjhijit Sen Committee recommended this shift of base year. • Services remain excluded from WPI. • No. of Quotations selected for collecting price data for the items is 5482. • Weights : Primary articles : 20.12%, (decrease from 22.03%) manufactured products :

64.97% (increase from 63.75%) for construction of WPI. • Inflation first appeared in 2nd Plan.

Types of Inflation :

• Demand - Pull Inflation : Aggregate demand is greater than aggregate supply. This results in Demand - Pull Inflation.

• Cost - Push Inflation : Increase in cost of production leads to cost-push inflation. Under this comes

o Wage-push inflation o Profit-induced inflation o Increase in indirect taxes by Govt.

• Mixed Inflation : Schultz proposed this. The features of Demand - Pull and Cost - Push inflation are found in this.

Stagflation is a sustained increase in price-level and rising unemployment. Philips curve shows relationship between changes in wage rate and unemployment which is inverse.

Structural inflation refers to the inflation that arises as a result of supply inelasticity and structural rigidities in the industrial sector. "Double deflation" refers to recession occurring twice with a small gap in between.

5.5% inflation is comfort zone according to RBI.

Shortnotes on ALM (Asset Liability Management) - Banking Basics for SBI and IBPS Common Interviews Friends, here is a detailed shortnotes on the strategic management tool of Banking Industry, ALM (Asset Liability Management). You can read our detailed guide for banking interview preparation which help you for SBI Associates Clerks, IBPS RRB and IBPS Common Interviews Here. What is ALM ? The full form of ALM is Asset Liability Management. This is the process of managing risks that arise due to mismatches between the assets and liabilities (debts and assets in simple words) of the bank. Here goes the technical definition of ALM.

The ALM is a comprehensive and dynamic framework for measuring, monitoring and managing the market risk of a bank. It is the management of structure of balance sheet (liabilities and assets) in such a way that the net earning from interest is maximized within the overall risk-preference (present and future) of the institutions. Scope of ALM The ALM functions extend to liquidly risk management, management of market risk, trading risk management, funding and capital planning and profit planning and growth projection. Residual maturity Residual maturity is the time period which a particular asset or liability will still take to mature i.e. become due for payment (once at a time, say in case of a term deposit or in instalments, say in case of term loan). Maturity Buckets Maturity buckets are different time intervals (8 for the time being, namely 1-14 days, 15-28, 29-90, 91-180, 181-365 days, 1-3 years, 3-5 and above 5 years), in which the value of a particular asset or liability is placed depending upon its residual maturity. Mismatch position When in a particular maturity bucket, the amount of maturing liabilities or assets does not match, such position is called a mismatch position, which creates liquidity surplus or liquidity crunch position and depending upon the interest rate movement, such situation may turnout to be risky for the bank. The mismatches for cash flows for 1-14 days and 15-28 days’ buckets are to be kept to the minimum (not to exceed 20% each of cash outflows for those buckets). Role of ALCO

Asset-Liability Committee is the top most committee to oversee implementation of ALM system, to be headed by CMD or ED. ALCO would consider product pricing for both deposits and advances, the desired maturity profile of the incremental assets and liabilities in addition to monitoring the risk levels of the bank. It will have to articulate current interest rates view of the bank and base its decisions for future business strategy on this view. Benefits of ALM As we've discussed above, ALM is a tool that enables bank managements to take business decisions in a more informed framework with an eye on the risks that bank is exposed to. It is an integrated approach to financial management, requiring simultaneous decisions about the types of amounts of financial assets and liabilities - both mix and volume - with the complexities of the financial markets in which the institution operates.

Complete List of Indian Banks and their Heads / CMDs / CEOs Friends, In this post we are presenting the Complete List of the Heads of the Banks in India. Hope this list will be a great help for you in the preparation of the upcoming Banking Exams and Interviews. This list was made with the details available as of 4th October 2012. We will update whenever there are changes in the list. If you came to know about any changes then please use the comment section below to comment, so that we will change immediately. Good Day and Happy Reading :)

STATE BANK and Its ASSOCIATES

• State Bank of India - Pratip Chaudhuri, CMD o State Bank of Bikaner And Jaipur - Shiv Kumar,MD o State Bank of Hyderabad - M Bhagavantha Rao,MD o State Bank of Mysore - Dilip Mavinkurve,MD o State Bank of Patiala - Achal Kumar Gupta,MD o State Bank of Travancore- P. Nanda Kumaran,MD

Nationalized Banks

• Allahabad Bank - Shubha Lakshmi Phanse (CMD) Replaced J. P. Dua on October 3rd 2012)

• Andhra Bank - B. A. Prabhakar,CMD • Bank of Baroda - S. S. Mundra,CMD • Bank of India - Smt. V. R. Iyer,CMD • Bank of Maharashtra - Narendra Singh,CMD • Canara Bank- S Raman,CMD • Central Bank of India - M.V.Tanksale,CMD • Corporation Bank - Ajai Kumar,CMD • Dena Bank - Smt. Nupur Mitra,CMD • IDBI Bank Ltd - R. M. Malla,CMD • Indian Bank - T. M. Bhasin,CMD • Indian Overseas Bank - M.Narendra,CMD • Oriental Bank of Commerce - S. L. Bansal,CMD • Punjab And Sind Bank - Devendra Pal Singh, IAS,CMD • Punjab National Bank - K. R. Kamath,CMD • Syndicate Bank - M G Sanghvi,CMD • UCO Bank - Arun Kaul,CMD • Union Bank of India - D.Sarkar,CMD • United Bank of India -Bhaskar Sen,CMD • Vijaya Bank - H.S Upendra Kamath,CMD

Private Sector Banks

• Axis Bank - Smt. Shikha Sharma,MD & CEO • Catholic Syrian Bank - Shri.V.P Iswardas ,MD & CEO • City Union Bank - Balasubramanian S • Development Credit Bank - Murali M. Natrajan,MD & CEO • Dhanalakshmi Bank - Amitabh Chaturvedi,MD & CEO • Federal Bank - Shyam Srinivasan,MD & CEO • HDFC Bank -Adtya Puri, MD & CEO • ICICI Bank -Smt Chanda Kochar, MD & CEO • Indusind Bank - Romesh Sobti, MD & CEO

• ING Vysya Bank - Shailendra Bhandari, MD & CEO • Jammu & Kashmir Bank - Mushtaq Ahmad, MD & CEO • Karnataka Bank - P. Jayarama Bhat, MD & CEO • Karur Vysya Bank - K. Venkataraman, MD & CEO • Kotak Mahindra Bank - Uday Kotak , MD • Lakshmi Vilas Bank - P.R. Somasundaram, MD • Nainital Bank - Devendra Pratap Singh,Chairman CEO • Ratnakar Bank - Vishwavir Ahuja, MD & CEO • South Indian Bank - Dr.V.A.JOSEPH, MD & CEO • Tamilnad Mercantile Bank - K.B. Nagendra Murthy, MD & CEO • Yes Bank's Ltd- Rana Kapoor, Founder/MD & CEO

Foreign Banks - Their Country Heads India

• City Bank- Pramit Jhaveri, Citi Country Officer, India • HSBC Bank- Naina Lal Kidwai,Country Head, HSBC • Standard Chartered Bank- Sunil Kaushal, chief of India operations

Banking Abbreviations Here are some Abbreviations which are useful for Banking Exams.

• ADB ----------------------- Asian Development Bank

• ADR ----------------------- American Deposit Reciepts

• AML ----------------------- Anti Money Laundering

• ANBC ----------------------- Adjusted Net Bank Credit

• ATM ----------------------- Automated Teller Machine

• BCSBI ----------------------- Banking Codes and Standards Board of India

• BPLR ----------------------- Bench Mark Prime Lending Rate

• CAR ----------------------- Capital Adequacy Ratio

• CBLO ----------------------- Collatarised Borrowing and Lending Obligations

• CBS ----------------------- Core Banking Solutions (Centralized Banking Solutions)

• CD ----------------------- Certificate of Deposit

• CD Ratio ----------------------- Credit Deposit Ratio

• CDR ----------------------- Corporate Debt Restructuring

• CIBIL ----------------------- Credit Information Bureau of India Limited

• CCIL ----------------------- Clearing Corporation of India Limited

• COPRA ----------------------- Consumer Protection Act

• CP ----------------------- Commercial Paper

• CRAR ----------------------- Capital to Risk Weighed Assets Ratio

• CRR ----------------------- Cash Reserve Ratio

• DGFT ----------------------- Director General of Foreign Trade

• DICGC ----------------------- Deposit Insurance and Credit Guarantee Corporation

• DRI ----------------------- Differential Rate of Interest

• DRT ----------------------- Debt Recovery Tribunal

• DSCR ----------------------- Debt Service Coverage Ratio

• ECGC ----------------------- Exports Credit Guarantee Corporation

• ECS ----------------------- Electronic Clearing Service

• EEFC ----------------------- Exchange Earner's Foreign Currency Account

• EFT ----------------------- Electronic Fund Transfer

• EPF ----------------------- Employee Provident Fund

• EXIM Bank ----------------------- Exports and Imports Bank of India

• FCNR ----------------------- Foreign Currency Non-Resident Account

• FEMA ----------------------- Foreign Exchange Management Act

• GCC ----------------------- General Credit Card

• GDR ----------------------- Global Depository Receipts

• IBA ----------------------- Indian Banks Association

• IDRBT ----------------------- Institute for Development and Research in Banking Technology

• IMF ----------------------- International Monetary Fund

• IRAC Norms ----------------------- Income Recognition and Assets Classification Norms

• KCC ----------------------- Kisan Credit Card

• KYC ----------------------- Know Your Customer

• LAB ----------------------- Local Area Bank

• LC ----------------------- Letter of Credit

• LOC ----------------------- Letter Of Comfort o Dont confuse between LC and LOC

• M-Banking ----------------------- MObile Banking

• NABARD ----------------------- National Bank for Agriculture and Rural Development

• NBFC ----------------------- Non-Banking Finance Company

• NDS ----------------------- Negotiated Dealings System

• NDTL ----------------------- Net Demand and Time Liabilities

• NEFT ----------------------- National Electronic Fund Transfer

• NHB ----------------------- National Housing Bank

• NI Act ----------------------- Negotiable Instrument Act

• NPA ----------------------- Non-Performing Assets

• NRE a/c ----------------------- Non-Resident External Account

• NRI ----------------------- Non-Resident Indian

• NWC ----------------------- Networking Capital

• OBU ----------------------- Off-Shore Banking Units

• PAN ----------------------- Permanent Account Number

• PLR ----------------------- Prime Lending Rate

• PMEGP ----------------------- Prime Minister's Employment Generation Programme

• PMRY ----------------------- Prime Minister's Rozgar Yojana

• PSA ----------------------- Priority Sector Advances

• QIB ----------------------- Qualified Institutional Buyers

• REPO ----------------------- Re-Purchase Option

• RIDF ----------------------- Rural Infrastructure Development Fund

• RTGS ----------------------- Real Time Gross Settlement

• RTI Act ----------------------- Right To Information Act

• SARFAESI Act ----------------------- Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest

• SCB ----------------------- Scheduled Commercial Banks

• SEBI ----------------------- Securities and Exchange Board of India

• SGL ----------------------- Subsidary General Ledger

• SHG ----------------------- Self Help Groups

• SIDBI ----------------------- Small Industries Development Bank of India

• SLR ----------------------- Statutory Liquidity Ratio

• SME ----------------------- Small and Medium Enterprises

• SWIFT ----------------------- Society for World wide Inter Bank Fund Transfer

• TDS ----------------------- Tax Deducted at Source

• UCPDC - 600 ----------------------- Uniform Customers and Practices on Documentary Credits

• YTM ----------------------- Yield To Maturity

Economic Planning in India In this post we shall discuss about Indian Economy. Espicially the Planning commission of India and Five Year Plans.These topics are very important for all Bank Exams. The Soviet Union is the 1st country in the world to adopt Planning. Latter in 1934 M. Visweswarayya wrote "Planned Economy of India". He is the first to introduce "Planning" concept in India. Lets have a look at some important points about the Economic Planning in India.

• 1938 : National Planning Committee under Jawaharlal Nehru.

• 1943 : Bombay Plan : Drafted by 8 big industrialists.

• 1944 : Gandhian Plan : Srimannarayan Agarwal.

• 1945 Apr 15 : People's Plan : M.N.Roy

• 1946 : Planning and Development Department constituted.

• Jan 1950 : Sarvodaya Plan by Jayaprakash Narayan.

• 1950 Mar 15th : Planning Commission constituted as per Art.39 of Directive Principles of State Policy of our constitution.

• Planning Commission is an Advisory Body, not a Statutory Body.

• Planning Commission's Chairman : Prime Minister (Dr. Manmohan Singh), Dy. Chairman : Montek Singh Ahluwalia.

o Arun Maria was appointed as 8th member, planning commission on 22-07-2009.

o Montek Singh Ahluwalia is the 1st one to become Dy. Chairman 2 Time.

• 1952 Aug 6th : National Development Council constituted.

• 1st Deputy Chairman, Planning Commission : V.T. Krishnamachary.

• Vakil and Brahmananda gave priority to wage goods sector.

• Objectives of Planning : Increase in National Income (NI) and Per Capita Income (PCI), full employment, poverty eradication via rapid economic groth, reduction of inequalities of income and wealth, socialistic pattern of society and absence of exploitation, reduction of regional inequalities, self-reliance.

Base Rate - Bench Mark Prime Lending Rate In this post we shall discuss two very important banking terms which are useful for Banking Exams. Those are Base Rate and Benchmark Lending Rate. Lets start with the definitions first.

BPLR (Benchmark Prime Lending Rate) :

The BPLR is the rate of interest at which commercial banks can lend money to EACH OTHER and to some large corporations. It is called benchmark rate or benchmark lending because it is commonly used to calculate other rates of interest.

Base Rate :

The Base Rate is the minimum interest rate for any bank. I mean, the bank cant lend you money for an interest less than this Base Rate (you may assume that this is the Base of the Interest, so that you can call it as Base Rate). Ofcourse, some exceptions are also there. RBI allowed some cases where Banks can lend amount for interest below the Base Rate except for DRI advances, They are loans to bank's own employees and banks' depositors against their own deposits etc.

Ofcourse, now a days we are not using the benchmark lending or BPLR process as the Base Rate Concept came into the limelight. The BPLR is slowly becoming less concerned and is made applicable normally only on the loans which have been sanctioned before the Base Rate has been made compulsory. But ofcourse, it is important for us as, we being bank exam aspirants, should learn everything about BPLR :)

Difference between BPLR and Base Rate :

A committee of RBI reviewed benchmark prime lending rate (BPLR) and introduced Base Rate to replace the benchmark lending rate. The main difference between BPLR and Base Rate is transparency . When compared to BPLR, the Base Rate is much more transparent and banks are not allowed to lend below the base rate (except for cases specified by RBI as mentioned in the above definition). Base Rate is to be reviewed by the respective banks at least on quarterly basis and should announce for public. On the other hand, the calculations of BPLR was mostly not transparent and banks were frequently lending below the BPLR to their prime borrowers and also under pressure due to various reasons.

Now Lets have a look at the Latest Base Rates and BPLR.

Base Rates :

Bank’s Name Base Rate wef

Allahabad Bank 10.75% 01/08/2011

Andhra Bank 10.75% 01/08/2011

Bank of Baroda 10.75% 01/08/2011

Canara Bank 10.75% 01/08/2011

Punjab National Bank 10.75% 01/08/2011

State Bank of India 10.00% 13/08/2011

Axis Bank 10.00% 06/08/2011

Federal Bank 10.25% 01/08/2011

HDFC Bank 10.00% 13/08/2011

ICICI Bank 10.00% 13/08/2011

Kotak Mahindra bank 9.75% 02/08/2011

Note : Clink on the Bank's name to get the appropriate link to check the present base rates.

BPLR Rates :

Bank’s Name BPLR Rate wef

Allahabad Bank 15.00% 01/08/2011

Andhra Bank 15.00% 01/08/2011

Bank of Baroda 15.00% 01/08/2011

Canara Bank 15.00% 01/08/2011

Punjab National Bank 14.25% 01/08/2011

State Bank of India 14.75% 13/08/2011

Axis Bank

06/08/2011

Federal Bank 17.25% 01/08/2011

HDFC Bank 18.50% 13/08/2011

ICICI Bank 17.75% 13/08/2011

Kotak Mahindra bank 18.50% 02/08/2011

Five Year Plans In India In this post we shall discuss about the Five year Plans in India. Click here to read about the previous topic Economic Planning in India. 1st Plan : 1951-56

• Priority giving to Agriculture and Irrigation. • "Harrod - Domar" growth model adopted. • This is the only plan in which Prices Fell.

2nd Plan : 1956-61

• PC Mahalanobis prepared this Plan. Priority given to basic and heavy industries. • Bhilai, Rourkela and Durgapur Steel Plants, ONGC, Ranchi Heavy Engg.

Corporation, Neyveli Lignite Corporation, Multi-purpose projects - Nagarjuna Sagar, Bhakra Nangal, Hirakud started during this Plan.

• Deficit financing Started in this plan. • "Socialist pattern of society" is accepted as a goal.

3rd Plan : 1961-66

• This plan is a Failure. Food output Fell. i.e., became negative. • Bokaro Steel Plant in 1964. • Severest drought in 100 years, occurred in 1965-66. • China's and Pakistan's innovations. • Rupee devalued in June 1966 (devaluation was first done in 1949).

During 1966-69 : Three Annual Plans, plan holiday.

• Green Revolution in 1966 Kharif. • 14 Banks nationalized in July 1969.

4th Plan - Aim : 1969-74

• Poverty Removal, Growth with stability with distributive justice, Self-reliance • Gadgil Formula : It was followed since 4th plan for central assistance for state plans.

This formula was modified by NDC in Dec. 1991 when Pranab Mukherjee was the Dy. Charman, Planning Commission. Hence it became Gadgil - Mukherjee formula since 8th Plan : "Planning from below" started from 4th Plan.

• "Garibi Hatao" slogan in 1971 Elections. • Privy purses were abolished in 4th Plan.

5th Plan - Aim : 1974-79

• Poverty removal became distinct objective for the first time. DP Dhar drafted. • "Minimum Needs Programme" launched. • Command Area Development Programme was started in 1974-75 to utilise water in

major and medium irrigation projects in an optimum manner. • Oil crisis : 1973 Sept. • 20 point programme replaced 5th plan, discontinued 1 year in advance.

6th Plan : 1978-83

• Proposed by Janata party but it was defeated in elections and could implement Rolling plan for 2 years for 1978-80. Prof. DT Lakdawala was the Dy. Chairman, Planning Commission.

• The idea "Rolling Plan" was taken from Japan. • "Rolling Plan" concept coined by Gunnar Myrdal. • "Hindu rate of Growth" crossed from 5th plan. This concept was coined by Prof. Raj

Krishna (Growth Rate 3% to 3.5%)

6th Plan - Aim : 1980-85

• Poverty eradication. • IRDP, TRYSEM, NREP launched during this Plan. • Visakhapatnam Steel Plant (Andhra Pradesh), Salem (Tamil Nadu) Bhadravathi Steel

Plants were built.

7th Plan : 1985-90

• Food, Work, Productivity, "Jawahar Rozgar Yojana" launched in April 1989. • Vakil and Brahmananda's wage good strategy adopted in the 7th Plan.

8th Plan : 1992-97

• Indicative planning : Based on the model of John.W.Muller. • This plan achieved highest growth rate of 6.8%. • "Indicative planning" implemented first in France in 1947-50.

9th Plan - Aim : 1997-2002

• Human resources development, growth with social justice and equality, agricultural rural development, important role to private sector.

10th Plan : 2002-07

• Growth rate target 87%, Achieved 7.8% • Highest in the entire planning era : 5 Crore employment, largest allocation to energy.

11th Plan : 2007-12

• Theme : "Faster and more Inclusive Growth" • Total proposed outlay : Rs. 36,44,718 Crores (doubled) • Union Government Rs. 21,56,571 Crores (59.2%) • States Rs. 14,88,147 Crores (40.8%) • Approach paper to 11th Plan approved by the Planning Commission on 18-10-2006. • 52nd National Development COuncil approved the Draft Plan on 09-12-2006. • 54th National Development Council approved in its meeting on 19-12-2007 • 55th National Development council meet held on 24-07-2010 • Central Gross Budgetary Support. Rs 14,21,711 Crores. • This is centre's support to plan. • Midterm Review of the 11th plan is done by Planning commission on 23-03-2010,

and the 11th plan growth target is reduced from 9% to 8.1% (It projects the growth rate for 20-09-10, 20-10-11, 20-11-12 as 7.2%, 8.5% and 9% respectively. Also to increase the outlay on infrastructure sector from the present $ 500 billion in 11th Plan to $ 1 Trillion in 12th Plan.

12th Plan : 2012-17

• This plan’s focus is on instilling “inclusive growth”. • The plan is concentrated to encourages the development of India’s agriculture,

education, health and social welfare through government spending. • It is also expected to create employment through developing India’s manufacturing

sector and move the nation higher up the value chain. • Our PM Manmohan Singh, however, warned that maintaining fiscal discipline is

important as well.

• Union Budget 2012-13 Highlights 16-March,2012 • Union Budget 2012-13 Summary 16-March,2012 • Dip in Tax Revenue & Increased Subsidies hit Fiscal Balance Amendments

Introduced to FRBM ACT 16-March,2012 • Unviable, Ineffective Subsidies may be Revisited; Central Subsidies to be Brought

Down to 1.75 Per Cent of GDP in three Years 16-March,2012 • Government Keen on Early Enactment of DTC Bill 16-March,2012 • Buy Backs, Stock Exchange Listings Allowed to PSUs in Divestmentmode 16-

March,2012 • Exemption Limit for Individual Taxpayers Raised to Rs. 2 Lakh 16-March,2012 • Measures Introduced to Allow Corporates to Access Lower Cost Funds; Promote

Higher Level of Investments in Several Sectors 16-March,2012 • Slew of Measures Proposed to Deter Generation and Use of Unaccounted Money 16-

March,2012 • To Promote Investment, Weighted Deduction for Expenditure in R&D and AGRI-

Extension Services Proposed 16-March,2012 • STT Proposed to be Reduced by 20 Per Cent 16-March,2012 • Lumpsum Grant Under National Family Benefit Scheme Doubled 16-March,2012 • Swarnajayanti Gram Swarojgar Yojana 16-March,2012 • Government to Achieve Vaccine Security 16-March,2012 • Measures Proposed for Skill Development and Augmenting Funds for SMEs 16-

March,2012 • Multisectoral Plan to Fight Malnutrition in 200 High Burden Districts 16-March,2012 • Panchayats to be Strengthened Through Rajiv Gandhi Panchayat Sashaktikaran

Abhiyan 16-March,2012 • Computerised PDSTO Become Operational by December 2012 16-March,2012 • Gross Tax Receipts Estimated at Rs.10,77,612 Crore-19.5% Increase Over 2011-12

Re 16-March,2012 • Full Exemption from Basic Customs Duty Given to Certain Infrastructure Sectors 16-

March,2012 • Fiscal Deficit to be Brought Down to 5.1% of GDPIN 2012-13 From 5.9% In 2011-12

16-March,2012 • Basic Customs Duty Reduced in Agriculture & Relataed Sectors 16-March,2012 • Plan Outlay for Agriculture & Cooperation Increased by 18% 16-March,2012 • Duty on Large Cars Enhanced from 22 Per Cent to 24 Per Cent 16-March,2012 • New Missions Proposed in the 12th Five Year Plan Amalgamating Host of Activities

inthe Agriculture Field 16-March,2012 • Service Tax Rate Raised from 10 Per Cent to 12 Per Cent 16-March,2012 • One Page Common Return for Central Excise and Service Tax Proposed 16-

March,2012 • Farmers Have Reasons to Smile: Agriculture Credit Increased to Rs. 5,75,000 Crore,

Farmers to Get a Smart Card to Get Easy Money From ATMs 16-March,2012 • Service Tax Exempted for Items on Negative List 16-March,2012 • Curbing the Black Money A Priority Concern for the Government; Number of

Proactive Steps To Tackle the Malaise Announced; White Paper to be Laid in Current Session Itself: FM 16-March,2012

• Aadhaarenrolments to Rise by 40 Crores in the Next Year, Adequate Funds Assured 16-March,2012

• Service Tax Exempted on Copyrights Relating to Recording of Cinematographic Films 16-March,2012

• Advance Pricing Agreement Introduced 16-March,2012 • Efforts to Arrive at a Broad Based Consensus on Allowing FDI in Multi-Brand Retail

Trade Up to 51% 16-March,2012 • Scheme for Capitalisation of Financially Weak Rrbs Extended by Another Two Years

16-March,2012 • Financial Inclusion Scheme ‘Swabhimaan’ to be Extended to Habitations with

Population of More Than 1000 in North Eastern and Hilly States and More Than 2000 in Other Habitations as Per Census 2011 16-March,2012

• Rs. 50 Lakh Crore Allocated to Infrastructure in Twelfth Plan; 50% Expected from Private Sector 16-March,2012

• Rs 15,888 Crore Provided for Capitalization of Public Sector Banks/RRBS and Other Financial Institutions 16-March,2012

• Harmonized Master List of Infrastructure Approved 16-March,2012 • Government Undertakes Financial Sector Legislative Reforms 16-March,2012 • Several Steps Proposed to Deepen the Reforms in Capital Market 16-March,2012 • 14% Hike in Allocation for Road Transport & Highways 16-March,2012 • Rajiv Gandhi Equity Savings Scheme Launched 16-March,2012 • ECB for Working Capital Allowed in Civil Aviation 16-March,2012 • Budget Aims at Creating Enabling Atmosphere for All Sections 16-March,2012 • ECB Allowed for Low Cost Housing 16-March,2012 • Union Budget Focuses on Rationalisation Measures in Indirect Taxes 16-

March,2012 • Excise Duty on ‘Demerit’ Goods Hiked as a Measure for Additional Resource

Mobilisation 16-March,2012 • Financial Package of Rs. 3884 Crore for Waiver of Handloom Loans 16-March,2012 • ECBS to Part Finance Power Project DEBT 16-March,2012 • Concessions and Exemptions Extended to Energy Saving Devices, Plants and

Equipments Required for Solar Thermal Projects 16-March,2012 • Health and Nutrition Gets Major Boost in the Budget 2012-13; 16-March,2012 • RS. 5000 crore India opportunities venture fund with SIDBI Announced 16-

March,2012 • Manufacturing Sector Provided Relief in Customs Duty 16-March,2012 • Delhi-Mumbai Industrial Corridor Receives Us $ 4.5 Billion from Japan 16-

March,2012 • Government Takes Steps to Finalize Pricing and Investment Policies for Urea 16-

March,2012 • Amendments to be Moved to Banking Laws and Insurance Laws 16-March,2012

Railway Budget

• Highlights of Railway Budget 2012-13 14-March,2012 • Railway Budget 2012-13 at a Glance : 14-March,2012 • Railway Safety Authority to be Set up 14-March,2012 • ‘Mission Mode’ Approach to be Followed in the Modernization Programmes

Quantum Jump in 12th Plan Investment at Rs. 7.35 Lakh Crore 14-March,2012 • Five Focus areas for Infrastructure Development Identified: Tracks, Bridges,

Signaling & Telecommunications, Rolling Stock and Stations & Freight Terminals Highest Ever Plan Outlay of Rs. 60,100 Crore this Year 14-March,2012

• 19,000 Km Railway Tracks to be Modernized 14-March,2012 • Signalling Systems to be Modernized with Advanced Technological Features 14-

March,2012 • Modernization of Rolling Stock 14-March,2012 • Logistics Corporation to be Set up 14-March,2012 • Coaching Terminal at Naihati and A Museum to be Named After Bankim Chandra

Chattopadhyay 14-March,2012 • Rs. 4410 Crore Allocated for Capacity Augmentation Works 14-March,2012 • Pradhan Mantri Rail Vikas Yojana 14-March,2012 • Two New Members to be Inducted for Finding New Resources 14-March,2012 • 75 New Express Trains to be Introudced Sikh Pilgrimage Train on Amritsar-Patna-

Naned Route 14-March,2012 • Minor Increase in Fare of All Class Travel 14-March,2012 • Rajdhani /Shatabdi Travel for Arjuna Awardees 50% Concession for Anaemia

Patients 14-March,2012 • Metropolitan Transport Projects 14-March,2012 • 137 Additional Sub-Urban Services for Mumbai,Chennai & Kolkata 14-March,2012 • New Passenger Amenities 14-March,2012 • New Project to Connect Agartala with Bangladesh 14-March,2012 • Initiatives for Differently-Abled Persons 14-March,2012 • New Initiatives for Security of Passengers 14-March,2012 • Good Progress of Rail based Industries; New Plants to be Set up for Coaches and

Locomotives 14-March,2012 • New Green Initiatives Include Green Train, BIO Toilets and Solar Lights 14-

March,2012 • Staff Amenities and Encouragement to Sports Persons 14-March,2012 • Freight Earnings to Grow by 30.2 Per Cent 14-March,2012 • Railways to Return Full Loan to Finance Ministry 14-March,2012 • List of 11 New Line Projects Sanctioned in 2012-13 14-March,2012 • List of 84 Adarsh Stations to be taken up in 2012-13 14-March,2012 • Projects being Executed with State Cooperation 14-March,2012 • New Gauge Conversion Projects Sanctioned in 2012-13 14-March,2012 • New Railway Electrification Projects Sanctioned in 2012-13 14-March,2012 • List of New Trains Announced in the Railway Budget 2012-13 14-March,2012 • Railway Minister Had Wide Ranging Consultations before Finalising Budget 14-

March,2012