Macro-economic overview of India

SOUND & HEALTHY

The financial sector in India is sound and healthy. The banking and non-banking institutions are performing in a competitive environment and their regulatory framework is now aligned with the international best practices.

Reserve Bank of India Report on Trend and Progress of Banking in India, 2007-08

*

Indian Apex Bank
Reserve Bank of India

Bankers' Forum

Indian Banks' Association is a body of  public and private sector banks,  foreign banks having offices in India, urban co-operative banks, developmental financial institutions, federations, merchant banks, mutual funds, housing finance corporations, etc.

State Bank of India & Associates
State Bank of India
State Bank of Bikaner and Jaipur
State Bank of Hyderabad
State Bank of Indore
State Bank of Mysore
State Bank of Patiala
State Bank of Saurashtra
State Bank of Travancore

Nationalised Banks
Allahabad Bank
Andhra Bank
Bank of Baroda
Bank of India
Bank of Maharashtra
Canara Bank
Central Bank of India
Corporation Bank
Dena Bank
Indian Bank
Indian Overseas Bank
Oriental Bank of Commerce
Punjab and Sind Bank
Punjab National Bank
Syndicate Bank
UCO Bank
Union Bank of India
United Bank of India
Vijaya Bank

Private Sector Banks
Bank of Rajasthan
Bharat Overseas Bank  Ltd
Bank of Punjab
Centurion Bank Ltd
City Union Bank Ltd
Development Credit Bank Ltd
ICICI Bank Ltd
IDBI Bank Ltd
IndusInd Bank Ltd
Lord Krishna Bank Ltd
SBI Commercial and International Bank Ltd
Tamilnad Mercantile Bank Ltd
Bank of Punjab Ltd
Dhanalakshmi Bank Ltd
Federal Bank Ltd
HDFC Bank Ltd
Jammu & Kashmir Bank Ltd
Karnataka Bank Ltd
Karur Vysya Bank Ltd
Lakshmi Vilas Bank Ltd
Nainital Bank Ltd
Sangli Bank Ltd
South Indian Bank Ltd
United Western Bank Ltd
ING Vysya Bank Ltd
UTI Bank Ltd
Ratnakar Bank Ltd
 
Foreign Banks

ABN Amro Bank
Abu Dhabi Commercial Bank Ltd
American Express Bank Ltd
Arab Bangladesh Bank Ltd
Bank of America 
Bank International Indonesia
Bank Muscat SAAG
Bank of Bahrain & Kuwait BSC
BNP Paribas
Barclays Bank Plc.
Citibank NA
Credit Agricole Indosuez
Credit Lyonnais
Deutsche Bank AG
ING Bank N.V. (ING Barings)
Mashreq Bank psc
Oman International Bank
Societe Generale
Sonali Bank
Standard Chartered Bank
State Bank of Mauritius Ltd
The Bank of Nova Scotia
The Bank of Tokyo-Mitsubishi Ltd
JP Morgan Chase Bank
The Development Bank of Singapore Ltd
The Hongkong & Shanghai Banking Corporation Ltd
Mizuho Corporate Bank Ltd
Sumitomo Mitsui Banking Corporation
UFJ Bank Ltd.

Cooperative Banks
Abhyudaya Co-op. Bank Ltd
Amanath Co-op. bank Ltd
Apna Sahakari Bank Ltd
Bassein Catholic Co-op Bank Ltd
Bombay Mercantile Co-op Bank Ltd
Citizen Credit Co-op Bank Ltd
Dombivli Nagari Sahakari Bank Ltd
Jalgaon Janata Sahakari Bank Ltd
Janakalyan Sahakari Bank Ltd
Janata Sahakari Bank Ltd
Janalaxmi Co-op. Bank Ltd
New India Co-op. Bank Ltd
Nutan Nagarik Sahakari Bank Ltd
Punjab & Maharashtra Co-op. Bank Ltd
Rajkot Nagarik Sahakari Bank Ltd
Rupee Co.-op Bank Ltd
The AP Mahesh Co.-op Urban Bank Ltd
The Bharat Co-op. Bank (Mumbai) Ltd
The Cosmos Cooperative Bank Ltd
The Deccan Merchants' Co-op. Bank Ltd
The Greater Bombay Co-op. Bank Ltd
The Gujarat Industrial Co-op. Bank Ltd
The Jalgaon Peoples Cooperative Bank Ltd
The Kalupur Commercial Co-op Bank Ltd
The Kapol Co-op. Bank Ltd
The Karad Urban Co-op. Bank Ltd
The Madhavpura Mercantile Co-op Bank Ltd
The Mahanagar Co-op. Bank Ltd
The Municipal Co-op. Bank Ltd
The North Kanara GSB Co-op. Bank Ltd
The Saraswat Co-op. Bank Ltd
The Sham Rao Vithal Co-op. Bank Ltd
The Surat Peoples Co-op. Bank Ltd
The Thane Janata Sahakari Bank Ltd
The Urban Co-op. Bank Ltd
The Visnagar Nagarik sahakari Bank Ltd
The Zoroastrian Co-op Bank Ltd
Air Corporations Employees Co-op. Bank Ltd
Kolhapur Janta Sahakari Bank Ltd

Apex Rural Bank

National Bank for Agriculture & Rural Development


INDIAN BANKING-II

Back to growth trajectory

DURING the past year and a half, financial stability has occupied a centre stage in policy circles in the wake of ongoing global financial crisis with wide ramifications. The initial impact of global financial contagion in India, however, has been limited for a variety of reasons. However, some impact has been felt through the credit, equity and the foreign exchange markets.

The financial sector in India is sound and healthy. The banking and non-banking institutions are performing in a competitive environment and their regulatory framework is now aligned with the international best practices.

Domestic financial markets conditions in general remained orderly during 2007-08, barring a brief spell of volatility in the call money market and occasional bouts of volatility in the equity market during the second-half of August 2007, second-half of December 2007 and beginning of the second week of January 2008. Yields in the Government securities market softened during the large part of the year.

The movements in the yields tracked the monetary policy measures. The Indian rupee exhibited two-way movement during 2007-08, and subsequently set on a depreciating trend  beginning July 2008. While non-banking finance companies are the major issuers of commercial papers (CPs), mutual funds (MFs) are major investors in CPs. The redemption pressure faced by MFs since September 2008 adversely affected liquidity conditions in the money market, which had a spill-over impact on the CP market.

Indian depositors enjoy a high degree of protection. About 93 per cent of deposit accounts and 61 per cent of total assessable deposits were fully protected at end-March 2008. The adverse global developments have led to moderation of growth in the industrial and services sectors in the first-half of 2008-09. In recent weeks, the impact on liquidity and credit has also been felt.

Inflation, in terms of the WPI, softened steadily since August 9, 2008. Globally, pressures from commodity prices, including crude, appear to be abating. The moderation in key global commodity prices, if sustained, would further reduce inflationary pressures.  

Deployment of Gross Bank  Credit  in Industries (2005-2006 to 2007-08)
(In Rs. crore)

INDUSTRY Outstanding as on Absolute variation
 

March 31, 2006
 

March 31, 2007
 

March 31, 2008
 

2006-07
 

2007-08
 
Mining & Quarrying incl. Coal 4146 7704 10616 3558 2912
Food Processing 30946 39999 50221 9053 10222
a) Sugar 8776 11551 16726 2775 5175
b) Edible Oils & Vabaspati 5077 6111 7191 1034 1080
c) Tea 1851 2340 2334 489 -6
d) Others 15243 19997 23970 4754 3973
Beverage & Tobacco 4002 4774 5641 772 867
Textiles 58472 78971 95935 20499 16994
a) Cotton Textiles 29781 38051 47337 8270 9286
b) Jute Textiles 1053 967 1055 -86 88
c) Man Made Textiles 3062 4178 4681 1116 503
d) Other Textiles 24577 35775 42862 11198 7087
Leather & Leather Products 4486 4774 5750 288 976
Wood & Wood Products 1497 2887 3060 1390 173
Paper & Paper Products 9148 11588 13622 2440 2034
Petroleum, Coal Products & Nuclear Fuels 25150 35886 41738 10736 5852
Chemicals & Chemical Products 48638 55774 64391 7136 8617
a) Fertilizer 10569 9837 9251 -732 -586
b) Drugs & Pharma 16273 18584 23286 2311 4702
c) Petrochemicals 6965 8316 9516 1351 1200
d) Others 14830 19037 22338 4207 3301
Rubber, Plastic * their Products 7250 9250 10410 2000 1160
Glass & Glassware 1817 2564 2759 747 195
Cement & Cement Products 7799 9389 14210 1590 4821
Basic Metals & Metal Products 65896 83870 104719 17974 20849
a) Iron & Steel 50991 63877 80790 12886 16913
b) Other metal and metal products 14905 19993 23929 5088 3936
All Engineering 34878 44026 52442 9148 8416
a) Electronics 11004 13511 16024 2507 2513
b) Others 23875 30515 36418 6640 5903
Vehicles, Vehicle Parts & transport Equipments 18628 20922 29152 2294 8230
Gems & Jewellery 20559 23850 24995 3291 1145
Construction 13303 19970 28298 6667 8328
Infrastructure 112853 142975 202296 30122 59321
a) Power 60157 72816 93899 12659 21083
b) Telecom   18455 19446 37121 991 17675
c) Roads & Ports 19695 24941 32990 5246 8049
d) Other Infrastructure 14546 25772 38286 11226 12514
Other Industries 80975 98161 111645 17186 13484
Total Industry
(Small, Medium & Large)
550444 697334 871900 146890 174566

Shareholding pattern of scheduled commercial banks
(at the end of March 2008)

Banks
Total Govt. and RBI
Resident 
Financial Institutions Resident
Financial Institutions Non-resident 
Other Corporates Resident
Other Corporates Non-resident
Total individual resident
Total Individual non-resident
Total resident
Total Non-resident
Nationalized
Allahabad Bank 55.2 9.6 18.5 2.9 - 13.7 0.1 81.4 18.6
Andhra Bank 51.6 12.7 19.3 3.2 - 13.2 0.1 80.6 19.4
Bank of Baroda 53.8 18.0 - 1.2 19.8 6.5 0.6 79.6 20.4
Bank of India 64.5 11.8 15.1 1.3 0.1 6.7 0.6 84.2 15.8
Bank of Maharashtra 76.8 5.7 8.1 0.9 - 8.5 0.1 91.8 8.2
Canara Bank 73.2 5.8 14.0 1.2 - 5.8 - 86.0 14.0
Central Bank of India 80.2 6.9 5.4 1.1 - 6.3 0.1 94.5 5.5
Corporation Bank 57.2 29.4 10.2 0.4 0.2 2.6 - 89.6 10.4
Dena Bank 51.2 8.5 - 6.6 - 20.9 12.8 87.2 12.8
IDBI Bank Ltd 52.7 23.8 - 7.0 - 16.5 - 100.0 -
Indian Bank 80.0 2.5 13.8 0.4 - 3.1 0.1 86.1 14.0
Indian Overseas Bank 61.2 6.6 18.3 1.1 - 12.1 0.7 81.0 19.0
Oriental Bank of Commerce 51.1 20.7 18.1 4.7 - 5.3 - 81.9 18.1
Punjab and Sind Bank 100.0 - - - - - - 100.0 -
Punjab National Bank 57.8 16.6 20.0 0.8 - 4.7 - 79.9 20.1
Syndicate Bank 66.5 6.7 12.4 1.8 - 12.7 - 87.6 12.4
UCO Bank 75.0 5.2 - 4.1 0.7 14.7 0.3 98.9 1.1
Union Bank of India 55.4 12.0 19.5 1.5 - 11.6 - 80.5 19.5
United Bank of India 100.0 - - - - - - 100.0 -
Vijaya Bank 53.9 8.2 14.9 3.2 - 19.4 0.5 84.6 15.4
State Bank Group
State Bank of Bikaner & Jaipur - 75.3 - 4.6 2.4 14.7 3.0 94.6 5.4
State Bank of Hyderabad - 100.0 - - - - - 100.0 -
State Bank of India 59.7 11.5 19.6 3.4 - 5.8 0.1 80.4 19.6
State Bank of Indore - 98.1 - 0.7 - 1.2 - 100.0 -
State Bank of Mysore - 94.0 - 0.3 - 5.6 - 100.0 -
State Bank of Patiala - 100.0 - - - - - 100.0 -
State Bank of Saurashtra - - - - - 100.0 - 100.0 -
State Bank of Travancore 1.1 76.1 2.8 3.6 - 12.6 3.8 93.4 6.6
Old Private Sector
Bank of Rajasthan - 3.9 15.6 65.3 - 15.0 0.2 84.2 15.8
Catholic Syrian Bank - - - 3.6 13.9 65.2 17.4 68.8 31.2
City Union Bank - 9.1 11.3 20.3 8.6 50.2 0.5 79.6 20.4
Dhanalakshmi Bank - 2.1 23.3 11.7 - 59.1 3.8 72.9 27.1
Federal Bank - 18.2 53.1 3.6 5.0 20.1 - 41.9 58.1
ING Vysya Bank - 15.7 22.8 2.5 43.9 10.6 4.5 28.8 71.2
J& K Bank 53.2 2.3 33.6 1.2 - 9.4 0.4 66.1 33.9
Karnataka Bank - 45.8 - 8.8 - 45.2 0.3 99.7 0.3
Karur Vysya Bank - 5.3 21.9 13.6 - 55.7 3.4 74.7 25.3
Lakshmi Vilas Bank - 12.1 - 24.8 2.7 60.3 0.2 97.1 2.9
Nainital Bank - 98.4 - - - 1.6 - 100.0 -
Ratnakar Bank - 2.1 - 10.8 19.9 59.7 7.4 72.7 27.3
SBI Commercial & International Bank - 100.0 - - - - - 100.0 -
South Indian Bank - 8.6 45.8 8.3 4.8 29.9 2.5 46.8 53.2
Tamilnad Mercantile Bank - 0.1 - 24.7 16.5 58.3 0.4 83.1 16.9
New Private Sector
Axis Bank Ltd - 50.8 37.5 5.3 1.4 4.8 0.1 60.9 39.1
Centurion Bank of Punjab - 0.1 27.8 17.9 36.7 15.5 2.1 33.5 66.5
Development Credit Bank - 2.3 - 12.2 64.6 20.0 1.0 34.5 65.5
HDFC Bank - 7.5 - 32.1 49.1 11.1 0.2 50.7 49.3
ICICI Bank - 6.4 69.4 16.6 - 7.2 0.4 30.2 69.8
IndusInd Bank - 2.7 19.0 17.9 39.8 17.3 3.2 38.0 62.1
Kotak Mahindra Bank - 4.4 26.2 7.7 0.6 60.4 0.7 72.4 27.6
Yes Bank Ltd - 0.7 40.9 17.0 13.5 26.5 1.5 44.2 55.9
SOURCE: Reserve Bank of India

While equity prices have since corrected by around 56.1 per cent (as on December 8, 2008) from the peak level, real estate prices continue at their elevated levels, although some reports do suggest some softening of prices in   some parts of the country in recent months. In view of the risks posed by accelerated exposures to the real estate sector, the central banking authority has initiated several regulatory measures.

RBI has been closely following the developments in the international financial regulation and supervision. In the Annual Policy Statement for 2008- 09 released in April 2008, the Reserve Bank indicated its status vis-à-vis the action plan devised by the Financial Stability Forum for implementation by the countries affected by the recent financial turbulence.

Following the unfolding of events since September 2008 reflected in the form of portfolio outflows by FIIs, sharp decline in the stock markets, lack of liquidity in the market with the inter-bank rates soaring to high levels and depreciating rupee, the Reserve Bank stepped in to restore public confidence by putting in place immediate corrective measures during mid-September and December 6, 2008. 

The Indian central banking authority hopes that the country, with its strong drivers of growth, may escape the worst consequences of the global financial crisis and hopes that once the global situation is stabilized, and calm and confidence are restored, India would return to the high growth trajectory.

Bank-wise Non-Performing Assets (NPAs) of Scheduled Commercial Banks

(As on Mmarch 31, 2008)

Banks Gross NPAs (In Rs Crore) Gross Advance (In Rs Crore) Gross NPA Ration (%)
Nationalized Banks

Allahabad Bank

1011 50312 2.0
Andhra Bank 372 34556 1.1
Bank of Baroda 1981 107672 1.8
Bank of India  1931 114793 1.7
Bank of Maharashtra 766 29798 2.6
Canara Bank 1416 107655 1.3
Central Bank of India  2350 74287 3.2
Corporation Bank 584 39664 1.5
Dena Bank 573 23381 2.4
IDBI Bank Ltd 1565 83608 1.9
Indian Bank 487 40228 1.2
Indian Overseas Bank 997 61058 1.6
Oriental Bank of Commerce 1280 55327 2.3
Punjab & Sind Bank 136 18409 0.7
Punjab National Bank 3319 120932 2.7
Syndicate Bank 1769 65197 2.7
UCO Bank 1652 55627 3.0
Union Bank of India 1657 75879 2.2
United Bank of India 761 28152 2.7
Vijaya Bank 512 32019 1.6
State Bank Group
State Bank of Bikaner & Jaipur 437 25304 1.7
State Bank of Hyderabad 312 35901 0.9
State Bank of India 12837 422181 3.0
State Bank of Indore 265 18356 1.4
State Bank of Mysore 359 21305 1.7
State Bank of Patiala 521 36724 1.4
State bank of Saurashtra 179 12309 1.5
State Bank of Travancore 571 28400 2.0
Other Banks
Axis Bank 486 59899 0.8
Bank of Rajasthan 126 7529 1.7
Catholic Syrian Bank 131 3387 3.9
Centurion Bank of Punjab 540 16455 3.3
City Union Bank 83 4575 1.8
Development Credit bank 63 4105 1.5
Dhanalakshmi Bank 63 2146 2.9
Federal Bank 469 19327 2.4
HDFC Bank 904 64032 1.4
ICICI Bank 7580 229892 3.3
IndusInd Bank 392 12897 3.0
ING Vysya Bank 116 14663 0.8
J&K Bank 485 19164 2.5
Karnataka Bank 380 11102 3.4
Karur Vysya Bank 194 9569 2.0
Kotak Mahindra Bank 453 15729 2.9
Lakshmi Vilas Bank 138 3931 3.5
Nainital Bank 19 1002 1.8
Ratnakar Bank 37 617 6.0
SBICI Bank 5 364 1,4
South Indian Bank 188 10597 1.8
Tamilnad Mercantile Bank 122 5431 2.2
Yes Bank 11 9432 0.1
Foreign Banks
AB Bank 3 26 102
ABN-AMRO Bank N.V. 294 20502 1.4
Abu Dhabi Commercial Bank 19 182 10.7
Antwerp Diamond Bank - 476 0.0
BNP Paribas 34 3805 0.9
Bank of America NA 1 3453 0.0
Bank of Bahrain & Kuwait 25 301 8.4
Bank of Ceylon 17 56 29.6
Bank of Nova Scotia 2 4776 0.0
Barclays Bank PLC 61 7664 0.8
Caylon Bank 2 1815 0.1
China Trust Commercial Bank 1 129 1.0
Citibank NA 1011 38915 2.6
Deutsche Bank AG 60 9000 0.7
Development Bank of Singapore 5 2368 0.2
HSBC Ltd 697 30467 2.3
J P Morgan 121 1158 10.5
Krung Thai Bank  - 9 0.0
Mashreq Bank - 41 0.0
Mizuho Corporate Bank 7 863 0.8
Oman International Bank - 1 0.0
Shinhan Bank - 314 0.0
Societe Generale - 385 0.0
Sonali Bank 1 9 10.0
Standard Chartered 723 33729 2.1
State Bank of Mauritius - 214 0.0
UFJ Bank - 2307 0.0
(-) Nil/Negligible
1 crore : 10 million

Source: Reserve Bank of India

*India’s fiscal year is April to March
SOURCE:
Reserve Bank of India release
Previous: A sound & healthy financial sector
Updated
December 2008

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