Banking Sector – UCO BankPresented by – Sajal Mondal

Banking Industry

Functions of Bank

• Accepting deposits from Public

• Lending money to public

• Remittances/Collection Business

• Keeping valuables in safe custody

• Government business

• Acting as trustee

• Treasury services

• Capital Market activity

History of Banking in India

The reminisce of banking in India can be traced back to the 4th century BC in the 'Kautilya Arthashastra‘.

However the real roots of commercial banking in India can be traced back to the early eighteenth century.

Bank of Hindustan was set up in 1870,it was the earliest Indian Bank.

Later, three presidency banks under Presidency Bank's act 1876 i.e. Bank of Calcutta, Bank of Bombay and Bank of Madras were set up, which laid foundation for modern banking in India

In 1921, all presidency banks were amalgamated to form the Imperial Bank of India.

The first bank which was exclusively set up by Indians was Allahabad Bank, followed by Punjab National Bank Ltd. set up in 1895 with headquarters at Lahore

The Reserve Bank of India was established on April 1, 1935 to control & regulate these banks in accordance with the provisions of the Reserve Bank of India Act, 1934.

In 1955, RBI acquired control of the Imperial Bank of India, which was renamed as State Bank of India. In 1959, SBI took over control of eight private banks floated in the erstwhile princely states, making them as its 100% subsidiaries.

The plan for nationalization was passed in1968. Thus forming the third turning point in the history of Indian Banking in India.

The Narasimha Committee report suggested wide ranging reforms for the banking sector in 1992 to introduce internationally accepted banking practices. The amendment of Banking Regulation Act in 1993 saw the entry of new private sector banks. private sector banks.

Who Regulates the Financial Sector in India?

Ministry of Finance• Controls and assists the financial sector• Every year the finance minister announces the budget• Also acts as the policy maker and regulates the financial sector

Reserve Bank of India• Apex Financial Institution of India, established in April 1935• Advises the central board on various matters• Acts as the investment banker to the Government

Securities and Exchange Board of India• Regulator of securities market in India• Protects the interest of investors in securities• Also regulates the development of securities market

Insurance Regulatory and Development Authority• An agency of the Government, based in Hyderabad• It works on the guidelines of IRDA Act, 1999• Safeguards the interest of the common man

Banking Structure in India

Indian Financial System –Share by Asset Size - 2013

Segment Market Share of Financial Assets (%)

Banks 63

Insurance Companies 19

Non-Banking Financial Institutions

8

Mutual Funds 6

Provident and Pension Funds

4

Indian Banking System – Share by Asset Size - 2013

Institutions Market Share of Banking Assets (%)

Scheduled Commercial Banks

92.4

Public Sector Banks 67.2

Private Sector Banks 18.7

Foreign Banks 6.5

Regional Rural Bank 2.7

Co-operative Banks 3.4

Local Area Banks 1.5

Share in the Banking Space

Type of Banks Number of Banks

Number of Branches

%age Share of Number of Branches

Market Share of Assets (%)

Public Sector 26 67,466 83.0 72.8

Private Sector 20 13,452 16.6 20.2

Foreign Banks 41 323 0.4 7.0

Total 87 81,241 100.0 100.0

Public sector banks have more presence relative to their share of assets.

Types of Banks

Central Bank (RBI)

Non Banking Finance Companies (NBFCs)

Commercial Banks Term Financial Institutions

State Finance Corporations (SFCs)

Indian Financial Institutions

E.g.IFCI

NABARDSIDBI

Public Sector Private Sector Foreign Co-operative Banks

Regional Rural Banks

E.g.SBIPNBBOB

E.g.HDFC Bank

UTI BankICICI Bank

E.g.Citibank

ABN AmroHSBC

State/Central PrivatePrimary Credit

Societies

Business Division

• Loans to individuals (Auto loan, housing loan, Education Loan and other personal loan) or small businesses

Retail Banking

• Loans to Mid and Large corporate (Working Capital loans, Project finance, Term loans, Lease Finance)

Wholesale Banking

• Investment in Equity, Derivatives, Commodities, Mutual funds, Bonds, Trading and Forex operations

Treasury Operations

• Merchant Banking, Leasing Business, Hire purchase, Syndication services etc.

Other Banking Businesses

Loan Products• Auto Loan• Gold Loan• House Loan• Credit cards• Education Loan• Loan against Securities• Retail Banking Business

Deposit Products• Deposits• Saving Accounts• Current Accounts• Fixed / Recurring• Corporate Salary A/C

Other Products/Services• NRI services• POS Terminals• Private Banking• Demat Services• Mutual Fund Sales• Foreign Exchange Services

Commercial Banking• Term Loan• Guarantees• Bill Collection• Letter of Credit• Working Capital• Forex & Derivatives• Wholesale Deposits

Transaction Banking• Cash Management• Custodian Services• Clearing Bank Services• Tax Collections• Banker to Public IssuesCommodities(Inc Hedging)

Key Segment• Large Corporate• Emerging Corporate• Financial Institutions• Government/PSUs• Agriculture Commodities

Product Segment• Equities• Derivatives• Capital Market• Debt Securities• Foreign Exchange

Other Financing• Cash Management• Statutory Reserve• Financial Decisions• Asset Liability Management

• Retail Banking1

• Wholesale Banking2

Treasury Banking3

Growth Drivers of the Banking Industry

•Growth of infrastructure, industry, services and agriculture is expected to grow corporate credit of the economy

•Nearly 35% of the Indian population has a median age of 25.5 years which signifies that India will gain its demographic dividendHigh growth of

Indian Economy & Favorable

Demographics

•Given that 40% of Indians lack access even to the simplest kind of formal financial services, the RBI on July 2011, mandated banks to allocate at least 25% of the total number of branches proposed to be opened in unbanked rural sector

•Banks considering FI as a banking opportunity rather than a Regulatory obligation are likely to see long term profitable growth and a cushion against market volatility

Financial Inclusion (FI)

•India not only enjoys a favorable demographic dividend but also has a strong population of High Net worth Individuals (HNWI)

•Given the improved performance of the equity markets in 2013 & increasing affluence beyond urban and metro areas the number of HNWIs is expected to rise further, HNWIS will continue to demand better or more sophisticated service

Private Banking & Wealth

Management

•New channels in banking services such as internet banking, mobile banking have increased productivity and help in acquiring new customers

•As per a survey conducted by PwC, today banks spend 15% of the total expenditure on technology today

Technology Innovation

Opportunities in the Banking Sector

• Mortgage to cross Rs 40 lakh crores by 2020

• Wealth Management to be a big business

• Rapid growth of branches & ATMs

• Mobile banking to see huge growth

• Infrastructure financing to reach over Rs 20 trillion on commercial banks book by 2020

• New Models to serve the small & Medium Enterprises (SME)

UCO bank

Profile of UCO bank• Established by G.D. Birla on 6th January 1943

• The bank was nationalized on 19th July 1969

• Headquarter in Kolkata

• As of September 2013 Mr. Arun Kaul is the chair man & Managing director of UCO bank

Size of UCO bank• The bank has some 45 regional offices and more than 2,600 branches throughout the

country. The bank also operates two major international financial centers in Hong Kong and Singapore

• Market capitalization of UCO bank is Rs 5,046 Cr

• CAGR of UCO bank 16.15%

• No. Of employee is 24,201

• Honours Your Trust s the tag line and Commitment to  Customers is the USP.

• Major competitors of UCO bank are .  Indian bank, Union  Bank of India, Dena bank, Indian Over seas bank

Various scheme offered by UCO bank• UCO KISAN BHOOMI VRIDHI Scheme

• UCO KISAN TATKAL Scheme

• UCO ESTATE PURCHASE LOAN Scheme

• Scheme for Solar Irrigation Pump set

CSR of UCO bank• The Bank believes that carrying out Corporate Social Responsibility (CSR) helps in tangible

value-creation. Moreover, CSR, creates a positive image in the society and inculcates essence

of loyalty for the Bank among a cross-section of countrymen.

• - An amount of Rs. 4.90 lakh to Shivaji University, Kolhapur, Maharashtra under environment protection category for installation ofSolar Plant Device. 

• - Rs. 2 lakh to Ramakrishna Math, Nattarampalli, Vellore, Tamilnadufor construction of building for an orphanage

• - Rs. 10 lakh to Mahaveer Viklang Sahayata Samity, Jaipur for helping the physically challenged.

 

Career opportunity in UCO bank Finance professional is key element of Banking Industry. A commerce graduate can enter this industry but top notch management jobs

goes to persons having MBA specialization in Finance. Today there is lot of competition in Banking industry as lot of Investment

products have been launched by various banks. MBA finance and Marketing Professionals are in great demand by Banking Industry to

market these products.

• Business Development Manager in Financial Services

• Branch Manager in Retail Banking

• Business Development Manager in Corporate Sales

• Business Development Manager Broking

• Portfolio Manager

• Banking Business Analyst

• Banking Customer Service Manager

• Bank Loan Manager

• Assistant Bank Mana

•Skills & competenciesKey Management Skills required in Banking Industry are -•Communication skills•Analytical Skills•Decision making skill•Teamwork Sills•IT skillsThey help Bank Manager to have a cordial atmosphere in Bank so that customer is satisfied with services and financial product information provided by Bank

Recruitment criteria for UCO bank As UCO bank is public undertaking bank it`s all recruitments are done through IBPS exam. The candidate should qualify the mentioned exam for get chance in UCO bank. For the MBA graduates bank has some own quota, but candidate should go through the exam. Some time the bank hires MBA graduate from the college campus.

SWOT analysis of UCO bankSWOT Analysis-

Strength

1. Foreign exchange Operations2. Diverse Asset portfolio3. High proportion of long term liabilities4. UCO Bank has over 2000 Service Units spread all over India, with two overseas branches in Singapore and Hong Kong5. One of the oldest and major commercial bank of India

Weakness

1. Lacks International presence2. Retail banking is lesser as compared to other banks3. Weak internet banking when compared to big banks

Opportunity1. Small enterprise banking2. More penetration through rural banking

Threats

1. Economic slowdown2. Highly competitive environment3. Stringent Banking Norms

Thank YouPrepared by:-

Sajal Mondal