Banking in India in the modern sense originated in the last decades of the 18th century.

The first banks were The General Bank of India, which started in 1786, and Bank of Hindustan, which started in 1770; both are now defunct. The oldest bank still in existence in India is the State Bank of India, which originated in the Bank of Calcutta in June 1806, which almost immediately became the Bank of Bengal. This was one of the three presidency banks, the other two being the Bank of Bombay and the Bank of Madras, all three of which were established under charters from the British East India Company. For many years the presidency banks acted as quasi-central banks, as did their successors. The three banks merged in 1921 to form the Imperial Bank of India, which, upon India's independence, became theState Bank of India in 1955.
Contents
[hide]

1 History

o o o o o

1.1 Colonial era 1.2 Post-Independence 1.3 Nationalisation in the 1960s 1.4 Liberalisation in the 1990s 1.5 Current period

2 Adoption of banking technology 3 Further reading 4 See also 5 References 6 External links

[edit]History In ancient India there is evidence of loans from the Vedic period (beginning 1750 BC). Later during the Maurya dynasty (321 to 185 BC), an instrument called adesha was in use, which was an order on a banker desiring him to pay the money of the note to a third person, which corresponds to the definition of a bill of exchange as we understand it today. During the Buddhist period, there was considerable use of these instruments. Merchants in large towns gave letters of credit to one [3] another. [edit]Colonial
[1][2]

era

During the colonial era merchants in Calcutta established the Union Bank in 1839, but it failed in 1840 as a consequence of the economic crisis of 1848-49. The Allahabad Bank, established in 1865 and still functioning today, is the oldest Joint Stock bank in India, it was not the first though. That honor belongs to the Bank of Upper India, which was established in 1863, and which survived until 1913, when it failed, with some of its assets and liabilities being transferred to the Alliance Bank of Simla. Foreign banks too started to appear, particularly in Calcutta, in the 1860s. The Comptoir d'Escompte de Paris opened a branch in Calcutta in 1860, and another in Bombay in 1862; branches inMadras and Pondicherry, then a French possession, followed. HSBC established itself in Bengal in

1869. Calcutta was the most active trading port in India, mainly due to the trade of the British Empire, and so became a banking center. The first entirely Indian joint stock bank was the Oudh Commercial Bank, established in 1881 in Faizabad. It failed in 1958. The next was the Punjab National Bank, established in Lahore in 1895, which has survived to the present and is now one of the largest banks in India. Around the turn of the 20th Century, the Indian economy was passing through a relative period of stability. Around five decades had elapsed since the Indian Mutiny, and the social, industrial and other infrastructure had improved. Indians had established small banks, most of which served particular ethnic and religious communities. The presidency banks dominated banking in India but there were also some exchange banks and a number of Indian joint stock banks. All these banks operated in different segments of the economy. The exchange banks, mostly owned by Europeans, concentrated on financing foreign trade. Indian joint stock banks were generally under capitalized and lacked the experience and maturity to compete with the presidency and exchange banks. This segmentation let Lord Curzon to observe, "In respect of banking it seems we are behind the times. We are like some old fashioned sailing ship, divided by solid wooden bulkheads into separate and cumbersome compartments." The period between 1906 and 1911, saw the establishment of banks inspired by the Swadeshi movement. The Swadeshi movement inspired local businessmen and political figures to found banks of and for the Indian community. A number of banks established then have survived to the present such as Bank of India, Corporation Bank, Indian Bank, Bank of Baroda, Canara Bank and Central Bank of India. The fervour of Swadeshi movement lead to establishing of many private banks in Dakshina Kannada and Udupi district which were unified earlier and known by the name South Canara ( South Kanara ) district. Four nationalised banks started in this district and also a leading private sector bank. Hence undivided Dakshina Kannada district is known as "Cradle of Indian Banking". During the First World War (19141918) through the end of the Second World War (19391945), and two years thereafter until the independence of India were challenging for Indian banking. The years of the First World War were turbulent, and it took its toll with banks simply collapsing despite the Indian economy gaining indirect boost due to war-related economic activities. At least 94 banks in India failed between 1913 and 1918 as indicated in the following table:

Years

Number of banks Authorised capital Paid-up Capital that failed (Rs. Lakhs) (Rs. Lakhs)

1913 12

274

35

1914 42

710

109

1915 11

56

1916 13

231

1917 9

76

25

1918 7

209

[edit]Post-Independence The partition of India in 1947 adversely impacted the economies of Punjab and West Bengal, paralyzing banking activities for months. India's independence marked the end of a regime of theLaissez-faire for the Indian banking. The Government of India initiated measures to play an active role in the economic life of the nation, and the Industrial Policy Resolution adopted by the government in 1948 envisaged a mixed economy. This resulted into greater involvement of the state in different segments of the economy including banking and finance. The major steps to regulate banking included: The Reserve Bank of India, India's central banking authority, was established in April 1935, but was nationalized on January 1, 1949 under the terms of the Reserve Bank of India (Transfer to [4] Public Ownership) Act, 1948 (RBI, 2005b). In 1949, the Banking Regulation Act was enacted which empowered the Reserve Bank of India (RBI) "to regulate, control, and inspect the banks in India". The Banking Regulation Act also provided that no new bank or branch of an existing bank could be opened without a license from the RBI, and no two banks could have common directors.

[edit]Nationalisation

in the 1960s

Banks Nationalisation in India: Newspaper Clipping, Times of India, July 20, 1969

Despite the provisions, control and regulations of Reserve Bank of India, banks in India except the State Bank of India or SBI, continued to be owned and operated by private persons. By the 1960s, the Indian banking industry had become an important tool to facilitate the development of the Indian economy. At the same time, it had emerged as a large employer, and a debate had ensued about the nationalization of the banking industry. Indira Gandhi, thenPrime Minister of India, expressed the intention of the Government of India in the annual conference of the All India Congress Meeting in a [5] paper entitled"Stray thoughts on Bank Nationalisation." The meeting received the paper with enthusiasm. Thereafter, her move was swift and sudden. The Government of India issued an ordinance ('Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969')) and nationalised the 14

largest commercial banks with effect from the midnight of July 19, 1969. These banks contained 85 [5] percent of bank deposits in the country. Jayaprakash Narayan, a national leader of India, described the step as a "masterstroke of political sagacity." Within two weeks of the issue of the ordinance, the Parliament passed the Banking Companies (Acquisition and Transfer of Undertaking) Bill, and it received thepresidential approval on 9 August 1969. A second dose of nationalization of 6 more commercial banks followed in 1980. The stated reason for the nationalization was to give the government more control of credit delivery. With the second dose of nationalization, the Government of India controlled around 91% of the banking business of India. Later on, in the year 1993, the government merged New Bank of India with Punjab National Bank. It was the only merger between nationalized banks and resulted in the reduction of the number of nationalised banks from 20 to 19. After this, until the 1990s, the nationalised banks grew at a pace of around 4%, closer to the average growth rate of the Indian economy. [edit]Liberalisation

in the 1990s

In the early 1990s, the then Narasimha Rao government embarked on a policy of liberalization, licensing a small number of private banks. These came to be known as New Generation tech-savvy banks, and included Global Trust Bank (the first of such new generation banks to be set up), which later amalgamated with Oriental Bank of Commerce, UTI Bank (since renamed Axis Bank),ICICI Bank and HDFC Bank. This move, along with the rapid growth in the economy of India, revitalized the banking sector in India, which has seen rapid growth with strong contribution from all the three sectors of banks, namely, government banks, private banks and foreign banks. The next stage for the Indian banking has been set up with the proposed relaxation in the norms for Foreign Direct Investment, where all Foreign Investors in banks may be given voting rights which could exceed the present cap of 10%,at present it has gone up to 74% with some restrictions. The new policy shook the Banking sector in India completely. Bankers, till this time, were used to the 4-6-4 method (Borrow at 4%;Lend at 6%;Go home at 4) of functioning. The new wave ushered in a modern outlook and tech-savvy methods of working for traditional banks.All this led to the retail boom in India. People not just demanded more from their banks but also received more. [edit]Current

period

By 2010, banking in India was generally fairly mature in terms of supply, product range and reacheven though reach in rural India still remains a challenge for the private sector and foreign banks. In terms of quality of assets and capital adequacy, Indian banks are considered to have clean, strong and transparent balance sheets relative to other banks in comparable economies in its region. The Reserve Bank of India is an autonomous body, with minimal pressure from the government. The stated policy of the Bank on the Indian Rupee is to manage volatility but without any fixed exchange rate-and this has mostly been true. With the growth in the Indian economy expected to be strong for quite some time-especially in its services sector-the demand for banking services, especially retail banking, mortgages and investment services are expected to be strong. One may also expect M&As, takeovers, and asset sales. In March 2006, the Reserve Bank of India allowed Warburg Pincus to increase its stake in Kotak Mahindra Bank (a private sector bank) to 10%. This is the first time an investor has been allowed to hold more than 5% in a private sector bank since the RBI announced norms in 2005 that any stake exceeding 5% in the private sector banks would need to be vetted by them.

In recent years critics have charged that the non-government owned banks are too aggressive in their loan recovery efforts in connection with housing, vehicle and personal loans. There are press reports [6][7][8] that the banks' loan recovery efforts have driven defaulting borrowers to suicide. [edit]Adoption

of banking technology

The IT revolution had a great impact in the Indian banking system. The use of computers had led to introduction of online banking in India. The use of the modern innovation and computerisation of the banking sector of India has increased many fold after the economic liberalisation of 1991 as the country's banking sector has been exposed to the world's market. The Indian banks were finding it difficult to compete with the international banks in terms of the customer service without the use of the information technology and computers.

Number of branches of scheduled banks of India as of March 2005

The RBI set up a number of committees to define and coordinate banking technology. These have included: In 1984 formed the Committee on Mechanisation in the Banking Industry (1984) whose chairman was Dr C Rangarajan, Deputy Governor, Reserve Bank of India. The major recommendations of this committee was introducing MICR technology in all the banks in the [10] metropolis in India. This provided use of standardized cheque forms and encoders. In 1988, the RBI set up the Committee on Computerisation in Banks (1988) headed by Dr. C.R. Rangarajan which emphasized that settlement operation must be computerized in the clearing houses of RBI in Bhubaneshwar, Guwahati, Jaipur, Patna and Thiruvananthapuram. It further stated that there should be National Clearing of inter-city cheques at Kolkata, Mumbai, Delhi, Chennai and MICR should be made Operational. It also focused on computerisation of branches and increasing connectivity among branches through computers. It also suggested modalities for implementing on-line banking. The committee submitted its reports in 1989 and computerisation [12] began from 1993 with the settlement between IBA and bank employees' association. In 1994, Committee on Technology Issues relating to Payment systems, Cheque [13] Clearing and Securities Settlement in the Banking Industry (1994) was set up under chairman Shri WS Saraf. It emphasized Electronic Funds Transfer (EFT) system, with the BANKNET communications network as its carrier. It also said that MICR clearing should be set up in all branches of all banks with more than 100 branches.
[11] [9]

In 1995, Committee for proposing Legislation On Electronic Funds Transfer and other Electronic [14] [12] Payments (1995) again emphasized EFT system.

Number of ATMs of different Scheduled Commercial Banks Of India as on end March 2005

Total numbers of ATMs installed in India by various banks as on end June 2012 is 99,218. The New Private Sector Banks in India is having the largest numbers of ATMs which is followed by off-site ATMs belonging to SBI and its subsidiaries and then it is followed by New Private Banks, Nationalised [12] banks and Foreign banks. While on site is highest for the Nationalised banks of India.
[12]

[15]

Branches and ATMs of Scheduled Commercial Banks as on end March 2005

Bank type

Number of branches On-site ATMs Off-site ATMs Total ATMs

Nationalised banks

33627

3205

1567

4772

States bank of India

13661

1548

3672

5220

Old private sector banks

4511

800

441

1241

New private sector banks

1685

1883

3729

5612

Foreign banks

242

218

582

800

State Bank of Mysore(Kannada:

) is a nationalised bank in India, with

headquarters at Bangalore. It is one of the five associate banks of State Bank of India. State Bank of Mysore was established in the year 1913 as The Bank of Mysore Ltd. under the patronage of then Maharaja Krishna Raja Wadiyar IV of erstwhile Govt. of Mysore, at the instance of the banking committee headed by the great Engineer-Statesman, Bharat Ratna Sir M.Visvesvaraya. During 1953, "Mysore Bank" was appointed as an agent of Reserve Bank of India to undertake

Government business and treasury operations, and in March 1960, it became a subsidiary of the State Bank of India under the State Bank of India (subsidiary Banks) Act 1959. Now the bank is an [3] Associate Bank under State Bank Group and the State Bank of India holds 92.33% of shares. The Bank's shares are listed in Bangalore, Chennai, and Mumbai stock exchanges. This bank has more than 745 branches and 10200 employees (September 2012) and the Bank has [4] 606 branches (80%) in Karnataka State. The bank has regional offices in Bengaluru, Mysore, Mangalore, Mandya, Hassan, Shimoga, Davanegere, Bellary, Tumkur, Kolar, Chennai, Coimbatore, Hyderabad, Mumbai and New Delhi. The bank's turnover in the year 2008-2009 was around US$10 Billion and Profit about US$65 Million. The Bank has a record of uninterrupted profits since 1913 and has declared dividend every year since 1913.
Contents
[hide]

1 History 2 Organisational Structure 3 See also 4 References 5 External links

[edit]History File:SBM Head office Year - event 1913 - The Bank was established as 'Bank of Mysore Ltd.', on 19 May, with an authorised capital of Rs.20.00 lakhs. Commenced its business on 2 October 1913. 1953 - During the year, the Bank was appointed as an Agent of Reserve Bank of India to conduct Government business & treasury operations. 1959 - With effect from the 10th September, the Bank was constituted as State Bank of Mysore as a Subsidiary of State Bank of India, under State Bank of India [Subsidiary Bankss] Act, 1959 enacted through an Act of Parliament, [Act No. 38 of 1959s]. 1959 -The bank has formulated schemes for financing coffee planters/coffee traders against coffee curers certificate, financing coffee traders, coffee exporters & coffee curers who also engage in trading.

- The Bank actively participated in all Government sponsored schemes and contributed its share of financial assistance or the economically weaker sections through DIR, IRDP, Prime Minister Rojgar Yojna & SUME schemes.

The Bank has sponsored two Regional Rural Banks, Cauvery Grameena Bank & Kalpatharu ameena Bank which were merged to form Kaveri-Kalpatharu Gramin Brank, headquarted at Mysore with more than 250 branches for growth of agriculture & rural industries. The Bank, as part of State Bank Group has been engaged in financing agriculture and MSME in 1960 & introduced the concept of need based rather than security oriented finance & the Entrepreneur scheme under which technically qualified persons were financed the entire requirement up to Rs.2 lacs. The Bank has 3 specialised SSI branches to assist the SSI units & proposes to establish 3 more such 551 branches shortly. The Bank has correspondent & agency arrangements all over the world & offers spot services in 18 major approved currencies. State Bank of Mysore handles a significant part of day-to-day banking business of both the Central & State Governments in the State of Karnataka & is a Banker to various Public Sector Undertakings in various sectors of Economy. The Bank has been actively participating in welfare banking needs of public through its community services. The Bank is a member of society for worldwide Inter Bank Financial Telecommunication [SWIFTs] which was established to offer cost effective & fast transmission of financial messages globally, 2 branches of Bank are presently covered under the scheme and an additional 15 branches are proposed to be covered under SWIFT shortly. 1992 - The State Government has also taken up vigorously 'ASHRAYA', a new housing scheme for weaker sections & 'VISHWA', a new rural & cottage industry scheme. A new programme called 'AKSHAYA' has also been launched to help the children in primary education. The Konkan Railway Project & the New Mangalore Port Project are also progressing satisfactorily. 1994 - Several important measures have been introduced in the busy season credit policy of November 1993 & slack season credit policy of May 1994, announced by Reserve Bank of India. 2000 - Mr. M. Sitarama Murty has been appointed as Managing Director, of Bank.

- Crisil has reaffirmed the A+ & P1+ ratings assigned to the bond issue & the CD programme of bank. 2001 - State Bank of Mysore has opened a foreign exchange cell at its Hirehally Industrial estate branch in Tumkur district to enable small-scale industrialists to manage their foreign exchange transactions.

- The Bank has closed its issue of unsecured non-convertible debentures after raising the target of Rs 60 crore. 2002

-Enters the market with a coupon of 6.4% per annum for its Tier-II capital bonds issue of Rs.60cr on a private placement basis.

-Slashes interest rate on domestic term deposits & on NRE deposits by 25-50 basis points. 2003

-Considers new method of appraisal for lending to the agricultural sector more on the lines of industrial credit given to trade & commerce. -Declared a dividend of 40% on equity capital for year ended. -Ties up with HMT Ltd & launches SBM-HMT Agri Farm Scheme, to promote agricultural mechanisation in south India. -Maruti Udyog forges alliances with SBM to offer car finance. 2004

-Mr. Vijayanand assumes charges as Managing Director of bank from 01/03/2004 -State Bank of Mysore has joined the Real Time Gross Settlement Systems [RTGSs] network that facilitates inter-bank funds settlement on 22 July. 2005 : 100% computerisation and Core Banking Solutions (CBS) introduced. 2005 : SBM unveils new single window system
[clarification needed]

2006 : Mr P.P. Pattanayak has assumed charge as Managing Director of State Bank of Mysore. Mr Pattanayak was earlier Deputy Managing Director [DMDs] & Chief Credit Officer of State Bank of India, Mumbai. 2009 : The Company splits its share with face value from Rs.100/- to Rs.10/-. 2009 - Sri Dilip Mavinkurve takes charge as Managing Director of the Bank. He was earlier Chief General Manager of the Bank. 2012- Shri Sharad Sharma takes charge as Managing Director of the bank.

[edit]Organisational

Structure

This section is empty. You can

help by adding to it. (January 2013)

[edit]See

also

Indian banking List of banks in India

[edit]References

1. 2. 3. 4.

^ http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-mysore.html ^ http://www.statebankofmysore.co.in/index.php/our-profile.html#financial ^ http://www.statebankofmysore.co.in/index.php/history.html ^ Prajavani Newspaper, Bangalore.Date:26.9.2012

[edit]External

links

Official Website

Our Profile
State Bank of Mysore was established in the year 1913 as Bank of Mysore Ltd. under the patronage of the erstwhile Govt. of Mysore, at the instance of the banking committee headed by the great EngineerStatesman, Late Dr. Sir M.Visvesvaraya. Subsequently, in March 1960, the Bank became an Associate of State Bank of India. State Bank of India holds 92.33% of shares. The Bank's shares are listed in Bangalore, Chennai and Mumbai stock exchanges. Branch Network The Bank has a widespread network of 737 branches (as on 31.03.2012) and 22 extension counters spread all over India which includes 6 Small and Medium Enterprises Branches, 4 Industrial Finance branches, 3 Corporate Accounts Branches, 6 specialised Personal Banking Branches, 9 Agricultural Development Branches, 3 Government Business branches, 1 Asset Recovery Branch and 6 Service Branches, offering wide range of services to the customers. Human Resources The Bank has a dedicated workforce of 10249 employees consisting of 3187 supervisory staff, 7062 nonsupervisory staff (as on 31.03.2012). The skill and competence of the employees have been kept updated to meet the requirement of our customers keeping in view the changes in the environment. Organisational Setup While the Chairman of State Bank of India is also the Chairman of the Bank, The Managing Director is assisted by two Chief General Manager and 12 General Managers. Management Committee of the Bank <<< click to see photos Managing Director Mr Sharad Sharma +91 80 22251855 +91 80 22353480 Fax 080 22254753 +91 80 22251570 Fax 080 22350563 +91 80 22350095 +91 80 22353487 Fax 080 22353478

Chief General Manager (Retail Banking)

Mr Kalyan Mukherjee Mr Saswata Chaudhuri

Chief General Manager(Commercial Banking)

General Manager (Human Resource & General Administration) Mr Bibhupada Nanda General Manager (SAMG) Mr J Ramakrishnan

General Manager (Priority Sector, Rural Banking & Financial Inclusion)

Mr K Lakshmisha

+91 80 22257149 Fax 080 22353494 +91 80 22353471 Fax 080 22356472

General Manager (Corporate Banking - Head Office)

Mr Rajiv Mathur

General Manager (Risk Management and Credit Policy and Procedures) Mr Parthasarathy N

General Manager (Treasury and Finance & Accounts)

Sri Viswanathan V

+91 80 22257149 Fax 080 22353494

General Manager (Retail NW Bangalore)

Mr A Karunanithi

+91 80 22350101 Fax 080 22375304

General Manager(Vigilance)

Mr Vijay Dube

+91 80 22255617 Fax 080 22350562

General Manager(IT and New Business) General Manager (NW - Mumbai) General Manager (Retail Network Mysore) General Manager (Inspection & Audit) Click here to view the ORGANISATIONAL STRUCTURE Financial Profile Mr Ravinder Kumar Madaan Mr S Bangara Raju Mr Subhabrata Ray

The paid up capital of the Bank is Rs. 468 Millions as on 31.03.2012 out of which State Bank of India holds 92.33%. The networthof the Bank as on 31.03.2012 is Rs.3412.72 Crores and the Bank has achieved a capital adequacy ratio of 12.55% as at the end of 31.03.2012. The Bank has an enviable track record of earning profits continuously and uninterrupted payment of dividend since its inception in 1913. The Bank earned a net profit of Rs.369.15 Crores for the year ended March 2012 and earning per share is at Rs.78.88 Business Profile Total deposits of the Bank as at the end of March 2012 is Rs.50186 Crores and the total advances stood at Rs. 40653 Crores which include export credit of Rs. 1325 Crores.The Bank is a major player in foreign exchange dealings also and has achieved a merchant turnover of over Rs 31583 Crores and a trading turnover of over Rs 146405 Crores for the year ended March 2012.

State Bank of Mysore H .O.: K.G.Road, Bangalore - 560 254, INDIA Phone: 91 80 22353901 to 22353909 ; 22353473. Fax: 91 80 22283684