NPA Vijaya

A study on the deposit schemes at Vijaya Bank Vijaya Bank
Chapter – I
Introduction
In an organization there will be a normal of activities carried on like
production, Marketing, planning, financier etc., among all these finances
plays a major role, Which made to study on this.
Finance has been studied as a part of Economics before the turn of the
present category formation of large sized undertakings by consolidating the
smaller ones brought before the Managements the problem of financing to
these enterprises.
The study of potentiality of different securities as a source of

procuring funds form out side world & the role & function of institutional
agencies continue to be emphasized during 1921.
ND
The problem of financing ensured a new dimension in the II world
war. In 1940’s financial wizards continued to be concern with the necessity
for choosing sells a financial structure as would be able to with stand stress
& strains of the part war adjustments.
In 1960’s & 70’s period was marked by a very faithful & exciting Era
for a of alternative developments. The financial manager started thinking on
such important issues as aggregate stock prices, business sale & etc.
The dimension of Business financial that was Earlier limited to period

but in recent years broadened according today-to-day operations.
Sri Adhichunchanagiri College of Business Management 1

Finance is regarded as lifeblood of an Enterprise. This is because in

the modern money oriented of all Economy finance is one of the basic
foundations of all kinds of economic activities. It is the master key. Which
provides accedes to all sources for being employed in manufacturing
activities. It has been rightly said that business needs money to make more
money, however, it also true that money begets more money only when it is
properly managed: there fore efficient management of every business
enterprise is closely linked with efficient management of its finance.
Meaning: Business finance explains the two terms. They are “Business “ &
“ Finance “. In common speaking the word “Business” is used to denote
merchandising the operation of some sort of a shop or store. Large or small.
It is however giving too narrow.
Definitions: According to Bonneville & Dewey = “Financing consists in the

raising providing & managing of all the money or funds of any kind used in
connection with the business.
According to Prather & wert, “Business Finance deals primarily
with raising administrating & distributing funds by privately owned
business units operating in Non – financial fields of Industry.
Function of Business Finance:
Finance function can be classified into two types

 Recurring finance function

 Non- Recurring finance function
1. Recurring function: Recurring finance functions Encompassed all

such
Financial activities as are carried out regularly for the efficient
conduct of a firm planning of funds. Placing of funds, allocation of
funds, income & controlling the uses of funds are the contents of
recurring finance function
 Planning for funds

 Rising of funds
 Allocation of funds
 Allocation of income
 Control of funds
2. Non-recurring functions: It refers to the use of functional activities that a

functional activity has to prefer very infreavently, preparation of financial
plant at the time of promotion of the company. The Financial readjustment
in time of liquidity crisis, valuation of the firm at the time of merger Success
full handle of such problems requires financial skills & understanding of
principle & techniques of finances recurring to Non – recurring Situation.

Introduction to Banking
The financial sector plays a major role in the Mobilization &

allocation of financial savings. Financial institutions. Instruments & markets
& which constitute the financial resources from the net savers to net
borrowers, the gains to the real sector of the economy. There fore, depend
on how efficiently the financial sector performs this basic function of
intermediation so that the transaction cost is kept minimum. The banks form
the most important segment of the financial sector. Deregulation of the
banking industry through the abolition of the administrated rates for the
deposits & loans gave the banks the freedom in fixing prices for their
products to compete effectively with Non – bank intermediaries, the banks
were permitted to undertake newer activities live investment banking.
Securities trading & insurance business through on selective basis. The
banks were forced to pay maximum attention on to operational efficiency so
that their transaction costs remained at the Minimum.
Induction of information technology & communications Networking

system is set to change the operating environment of banks drastically.
Technology has already enabled some of the banks to introduce innovation
product to their customers in the from of ATM facility, tale banking & home
banking any time & anywhere banking.
Origin of the word “bank”: - Opinion is not uniform with regard to

the origin of the word “bank”. According to some authors, the word “Bank”
is derived from the words “Banc us” or “Banquet” that is a bench. The early

bankers the Jews in Italy transacted their business on benches in the market
place, when a banker failed his “Bench “ was broken into pieces by the
people which indicated the bankruptcy of the individual banker. But this
explanation was turned out on the ground that the Italian moneychangers as
such were called bankers in the Middle Ages. Some others say that the word
bank originally derived from the German word “pack; meaning a Joint stock
fund, which was Italians into ban co when, the Germans were masters of a
great part of Italy according to professor Ramachandra Rao “What ever to
the origin in of the word bank, it would trace the history of banking in
Europe from the Middle Ages.
Bank: A bank is an institution, which deals with money. It means that a

bank receives money in the born of deposits from public & lends money to
the development of trade & commerce.
Prof. Hart says that banker is one who in he ordinary course of his
business. Receives money which, He repays by honoring the cheques of
persons from whom or on whose account he receives it.
Professor Kinley defines a bank as an establishment, which makes to

individuals such advance of money, as may be required, and safely made &
to which individuals entrust money, which it is not required by them for use.
The Indian companies Act defines the term bank as “The accepting for
the purpose of lending or investment of deposits of money from the public

repay able on demand or other wise & withdrawal by cheque, draft, & order
or other wise
Classification of bank:-
 Commercial bank
 Investment or Industrial Bank
 Exchange Bank
 Co-operative Banks
 Land development Banks
 Saving Bank
 Central Bank
1. Commercial Bank:
Commercial banks perform all the business transactions of a typical bank
Commercial banks accept three types of deposits. The savings Bank deposits,
fixed deposits & current deposits. They accept these deposits, which are
repayable on demand or on short notice. As such, they send or invest only
for shoot durations. They provide funds only short term funds of trade &
commerce. The commercial banks confine their activities to day –to-day
functions of trade & industry. Since the commercial banks are expected to
meet immediate requirement of depositors, they cannot invest creditors &
our drafts. The commercial banks render an important service by providing
to its customers a simple means of exchange

Functions of commercial bank are:

1. Receiving of deposits 2. Lending of funds
3. Investment 4. Creation of Money.
2. Industrial banks or investment banks:

Investment Banks are provides fixed capital or long term loan to industries.
As they finance industries they are called industrial banks. They are also
called investment banks as they invest their funds in subscribing to the shares
& debenture of industries.
The main functions of industrial Banks are:
1. They grant long term loan to industries.
2. They subscribe to the share capital & dentures of industries.
3. They under write shares & debentures
4. Provide technical assistance
5. Participating in the management by having their representatives
in the board of industry
6. Advice the type of industry to be set up
7. Providing guidance to their customers regard to purchase &
scale of share & debentures
8. Advising the government on matters relating to industries
3. Agricultural Banks:
These are the banks provide finance to agriculture. As they finance
agriculture mainly they are called agricultural Bank.

Agricultural Banks are in our country based on co-operation system

They are of 2 types.
1. Agricultural co – operative banks
2. Land development banks.
1. Agricultural co-operative banks land development banks.
The farmer, provides shooter finance to purchase fertilizers,
pesticides, seed & the payment of cages where as the later provided
long term finance to the farmers to purchase agricultural machinery
installing pump set, improving plants, repayment of old debts,
construction of Irrigation work etc,.
2. Land development banks:
LDB's are those banks which provide finance to the poor people
who are having no land, who are willing to take land's by providing
some finance.
4. Exchange Banks:
These are the banks finance mainly the foreign Exchange business of a
country they are called exchange banks because they finance mainly for the
foreign exchange business the main functions are:
1. Purchasing discounting, export & import of bills

2. Collecting exports Bill of exchange on behalf exporters
3. Accepting Bill of exchange on behalf of Importers
4. Provides necessary trade information to both

5. Provide remittance facility not only to the business men but also
to the tourists
6. They purchase & sell god silver & foreign currency.
5. Savings bank:
These are special banks specialize on the Mobile Station of small
savings of middle & low-income groups they are called savings bank
because they are concocted as mobilization of small savings. In our country
the business of selling banks is formed by commercial banks & post office
the principle function are: Mobilizing small & scattered savings of people
promoting the habit of thrift [loess spending expenses & savings]
Investing major portion of their deposits on government securities.
6. Central Bank:
A central bank is the highest bank & monetary Institution of a country
it operates under the control of state & works for the promotion of monetary
& Economic stability of the country the main functions are
a) It has monopoly in issuing currency notes
b) Acting as a banker to government
c) Serving as bankers bank & Acting all controller of credit
d) Acting as custodian of nations gold & foreign
7. Mixed banking:
Mixed banking is the system under with the commercial banks provide
short term & long-term finance to industrial concern Here the commercial

banks mix or combine the commercial banking & industrial or investment

banking functions.
Commercial Banks:
Commercial banks are banks, which accept deposits from the public &
lend them mainly to commerce for short periods. As they finance mainly
commerce, they are called commercial banks.
Commercial banks are found all over the world & they dominate the
banking system in every country.
Functions of Commercial banks: The functions of commercial banks are

numerous they can be broadly divided into two types
1. Primary function
2. Secondary function.
PRIMARY FUNCTIONS:
The primary functions of commercial bank are:
 Receiving of deposits
 Lending of funds
 Investment of funds on securities
 Creation of Money
1. Receiving Deposits: Deposits constitute the main source of funds for

Commercial banks. Commercial bank receives deposit from the
public on various accounts. The main types are:

1. Current Accounts
2. Savings deposit Account
3. Fixed deposit account
4. Recovering deposit account
2. Lending of funds: Lending of funds constitutes the main business

commercial bank. The major portion of the funds of commercial bank is
employed by way of advances. As advances from the chief source of profit
for banks.
Bank lends funds to the public by way of:
 Loans
 Occur drafts
 Cash credit
 Discounting of bills
3. Investment of funds on securities: They invest considerable amount of

their funds in government & industrial securities. In India commercial banks
are required by statute to invest a good portion of their funds in government
& other approved securities.
4. Creation of Money: Commercial banks not only receive deposits from the
public & lend them to needy. But also create money.
In the process of lending funds they lend many times more than the cash
deposits. They receive from public

SECONDARY FUNCTION:
A part from performing the main fictional of accepting deposits &
granting advances a banker performs a number of subsidiary services banker
will be able to earn the good will of his customer & attract fresh customers.
The secondary services of a banker may be divided into two classes:

 Agency services
 Miscellaneous services
AGENCY SERVICES:
1. Collection of money on behalf of customers: A Banker undertakes to
collect money on behalf of his customer. He collects crossed &
uncrossed cheques & bank drafts on behalf of the customers & credits the
proceeds to the customers.
2. Making the payment on behalf of customers: A banker under takes to

make payment on behalf on his customers. He pays the Bill of Exchange
& promissory. Notes on behalf of customers.
3. Purchase & sale of securities on behalf of customers: As a banker has

contact with stockbrokers & as the customer, generally, not conversant
with the procedure for buying & selling securities in the stock exchange,
the banker under takes to buy & sell securities on behalf of the customers
through stock brokers.

4. Advising customers regarding stock exchange investments: A banker

advises his customer regarding investment on stock exchange securities.
When advice sought by the customers.
5. Arranging for Remittance of funds on behalf of customers: A banker

arranges for remittance of funds from one place to another on behalf of
their customers by means of bank draft, mail transfer & telegraphic
transfers.
6. Issuing of credit cards: Banks also issue credit cards to their customers
for making purchase & shopping. The credit card facility Receives the
credit card holder from the trouble of carrying cash for making purchase
further, it minimizes the risk of loss of cash. It also has ATM centers in
major cities which provide to his customer 24 hours banking facilities.
7. Acting as trustee, executor, administrator & Attorney of customer:

Banker acts as a trustee executor, administrator & attorney of customer
8. Serving as correspondents & representatives of customers: A banker

serves as a correspondent & a representative of his customers. As a
correspondent & a representative of a customer. The banker prepares
income tax returns of the customer. Corresponds with the income tax
authorities on behalf of the customers.

9. Rendering merchant banking facilities: Big commercial banks have set

up merchant banking division manned by qualified staff to perform
merchant banking facilities to commercial & industrial houses
2. MISCELLANEOUS SERVICES:
Services rendered by a banker not only to his customer, But also to
the general public, some of them are :
 Receiving valuables & securities for safe custody

 Helping foreign trade transaction
 Issuing of traveler’s letter of credit, & traveler’s cheque to the
travelers & tourists
 Acting as referee regarding financial standing of his customers
 Under writing of shares & debentures
 Entrepreneur development programs
DEPOSIT:
Referring to banks, professor ” Sayers “have said that bank is a not only
dealer in money but also manufacture of credit money. It is in the sense of
manufacturing that the concept of credit creation is used. The banks cannot
create any money. But they can create money through deposit creation.

Deposit creation is an important function of commercial banks without

deposits. They cannot lend at all. Deposit creation is by two types. When
the bank receive cash form the customers. Deposits are created. This
deposit may be savings bank deposit or current deposit any amount deposited
in these accounts could be withdrawn by issue of cheques.If there is no limit
for with drawl. Then that deposit is called current account. If there is any
restriction for withdrawal. Then it is called saving bank account savings
deposits may be of several types such as fixed deposit, recurring deposits etc
current deposit are used for payments that may arise in future. In the case of
current deposits the depositor wants the bank to offer facilities to withdraw
in the form of cheques as many times as possible. In the savings bank
account, the depositor does not expect these facility, but expert compensation
in the form of interest.
The Bank attracts deposits from the people either by means offering
interest or other facilities. Business people want facilities with drawl more
than interest. Non-business people opiate savings account. A customer may
open any type of account. If he opens a current accounts & if there is
substantial money in that account. He may transfer money from current
account to the savings account & vice versa. The bank has nothing to do
with this behavior of the customer.
Meaning of Deposit: Deposits represents the amount accepts by a bank from

the deposits. It is the most important intern on the liability side because
1. They are major portion of the funds received by a bank

2. The capacity of a bank to earn profits depends on the volume of

deposits
3. The efficiency of a bank is judged by its ability to attract deposits.
Primary And Derivative Deposits:

Deposits may be created in two ways. When the customer tenders
cash into the bank, then the deposit account is opened & the amount is
credited to his account. It is called primary deposit. Using this cash the bank
buys various assets in the form of short-term bills of exchange securities.
Share & stocks or it may lend in the form of cash credit to the industries.
While buying these assets or lending money to the business people, cash is
not given to them but demand deposit are opened, these deposits are called
secondary deposits or derived deposits. If the banks have to create demand
deposits. Existence of primary deposit is essential. The initiative of creating
such deposits lies with the banking system. The banks may either create of
May not create such deposits. If the banks find that there are sufficient
short-term bills of exchange. Then they may show interest in creating these
deposits. The cash received in the form of savings deposits will be used by
the banking system to create derived deposit they are called derived deposits
because they originate from the primary deposits. These derived deposits
also add to money supply.
Types of Accounts, which are Held in Bank
1. Current deposit account: [Current or Running account}
A current account is an account, which is generally opened by
business people for their convenience. Money can be deposited &

withdrawn at any time. Means cheques can withdraw money. Usually, a

banker does not allow any interest on this account. Even then, people come
forward to deposit money on current account because of two important
privileges, which they can enjoy in a current account Namely:
1. Over draft facility
2. Other facilities like collection of cheques. Transfer of money &
rendering agency & general utility services.
That is why current account holder do not mind a banker chagrin some
commission for services rendered & incidental charges for maintaining the
account whether it is in debit or in credit. Even though a banker does not
allow any interest, he charges interest on overdraft on a day – to – day basis.
In bank of Maharashtra US. United constructions co & others, it was held
that when a customer over-draw the account with or without express consent,
it amounts to a loan & the customer is around to make good the payment
with a reasonable interest.
Current Account holders should keep a minimum balance of Rest 500/- to

keep account running. In a mechanized branch, a minimum balance of Rs
5000 has to be maintained. If this minimum is not kept a minimum charge of
Rs 11/- per operation will be debited to the account. The bank sends a
statement of account to the customer every month. As these deposits are
repayable on demand. The banker should keep a large cash reserve. This
may be one of the reasons why a banker does not pay any interest on the
current deposit.

2. Fixed Deposit Account: A fixed deposit is one, which is repayable after

the expiry of a predetermined period fixed by the customer himself. The
period varies from 15 days to 3 years. A deposit account can be opened for a
period of more than 3 years & in that case the rate of interest remains the
same level. In England these deposits are not repayable on demand but they
are with draw able subject to a period of notice. Hence, it is popularly known
as “Time Deposit “ or time liabilities. In India also, the banks have began to
call it “term Deposit” Normally the money on a fixed deposit is not
repayable before the expiry of a fixed period.
3. Saving Deposit: This deposit is intended primarily for small-scale savers.

The main object of this account is promotion of thrift. Hence there is
restriction on with drawls in a month. Heavies with drawls are permitted
only against prior notice, generally, the number of with drawls permitted is
50 per half year.
This account can be opened with a minimum of Rs5/= some banks live
state bank of India keeps it as Rs 20/-.
The minimum balance is not maintained, incidental charges will be
levied at the rate of 50 paise per kolio with a minimum of Rs 1 / - & a
maximum of Rs 5/-
It carries an interest rate of 4 % from April 2000 PA Interest is
allowed on minimum monthly balance in steps of Rs. 10/- multiples there of
between the 10th & the last day of each calendar month.
Generally, overdraft facility is not available in the savings Bank
Account, How ever, instant credit facility unto Rs 2500/- only is available to

savings bank customers for their outstation cheques provided such cheques
do not arise out of trade transactions.
The depositor is supplied with a pass book generally no with drawals
are allowed without the presentation of pass book along with the withdrawn
slip. Now – –days savings account holders are given cheque facilities &
money can be withdrawn by means of cheques also. Cheques are also
collected on this account. The nomination facility is also available on
savings bank account.
4. Recurring Deposit: It is one form of savings deposits depositors save &
deposit regularly every month a fixed installment so that they are assured of
the sizeable amount at a later period. This will enable the depositors to meet
contingent expenses. Banks have found this deposit popular. Many people
would not have saved If these deposits had not been introduced. This deposit
works on the” maximum little drops of water make a big ocean.”
Any person can open this deposit account. He can even have than one
account at a time. This account can be opened in joint name also.
For deposit of higher installment, the maturity can be calculated as
multiples of maturity amount for an installment of Rs5/-
Chapter – 2
RESEARCH DESIGN

Introduction: -
A research design is a plan of action to be carried out in

connection with a research project. The design may be a logical
presentation of the various steps in the process of research. These steps
include The statement of problem, Objectives of the study, Scope of
study sampling, tools & techniques of data collection, Plan of analysis
limitation and chapter schemes.
According to Claire sleets & others “A Research design is a
arrangement for collection and analysis of data in a manner that aims to
combine relevance to the research purpose with economy in procedure.
Title of study:
“A Study on the deposit schemes at Vijaya bank”.
INTRODUCTION TO THE TOPIC: -

In modern word banks are playing dominant role in economic
development of the country. As there is a development when its
ceases to generate any income through the various schemes of
deposits. As deposits are generating income to the banks for there
further process it very essential to every bank.

Statement of the problem:

In the present scenario, the banks are playing an important role in
the economic development of our country as they helps in encouraging
the people to make savings. These savings are attracted & made to
deposit in the banks for further productive investment. For the purpose
of this the bank has introduced many deposit schemes according to the
convenience of people based on the different categories. So, it is felt very
much essential to make a study on these deposit schemes that how it
influences on the development of Economy & what are the conditions &
terms that are to be fulfilled to make the deposits under various
schemes.
Objectives of the study:
1. To ascertain the problem faced by bank by Public regarding Deposit

2. To know the different schemes of deposits provided by Vijaya bank.
3. To know the methodology used by bank to Mobilize deposit from
public
4. To suggest ways & means of developing the deposit schemes.
5. To know the interest rate & other facilities provided by bank to
deposit holders
6. To study & know the financial problem of Bank
7. To provide manager with report to help them to Encourage
Customers for depositing.
8. To come out with the findings & suggestions

Scope of the study: In today’s world, banking services plays on

important role in every lives of individuals. The technological
advancements in the banking sector have grown rapidly in the last
years. This has led to the birth of new generation banks & competition.
The study basically focuses towards the observation of the operations &
performance of Vijaya Bank regarding deposits. The study with in its
scope has tried to find out the new trends promoted by the Vijaya Bank
regarding deposits.
This study attempts at understanding how Vijaya Bank functions
in its changing scenario & how each department at the head office
contributes to the success.
From the management point of view the study helps them to know
whether they are successful with their operations & as management
student this study helps in getting birds eye view of latest development &
upcoming changes in Banking sector.
VIJAYA BANK: The study has been undertaken on "the schemes of
Deposits at VIJAYA BANK " the objective of this study envisages on
deposit management on loan portfolio of the bank. Also an attempt has
been make to identify the techniques and suggest strategies for arresting
the existing deposits and prevent the re- emergence of fresh deposits at
the VIJAYA BANK .

Methodology: Personal interview was adopted for collecting data from

Vijaya Bank regarding deposits schemes for collecting primary data and
secondary data is collected through the following
1. Financial Books
2. Annual reports
Tools & the techniques of data: Analysis & interpretation of data in

based on both primary & secondary data.
a) Primary data: Primary data are the first hand information

collected, through various methods such as observation, interviews.
b) Secondary data: Secondary data are obtained from textbooks,

magazines, news paper & Annual reports & Broachers of the bank &
official website.
LIMITATION OF STUDY:
Every efforts has been made to make study complete & has
exhaustive as possible, however the study is not free from certain
limitations.
1. Some times respondent’s dislikes to discuses regarding data
collection.
2. Time limit for the study

3. The study is only confined to Vijaya Bank & the performance of

other banking company is not compared with it.
4. The collected information is limited & factual to some extent since
some information is confidential & Bank opposed to dispose it .
5.The exhaustive study has not been made on Vijaya Bank & is
limited
to the partial fulfillment for the degree of B.B.M.
6.Collection of data & study was based purely on observation of the
operation of Vijaya Bank constraint.
PLAN OF ANALYSIS:
The data collected was compiled, classified and tabulated for the
purpose of the study. This data is analyzed and is represented in the
forms of tables and graphs, making use of statistical techniques such as
averages and percentage for better understanding.

Chapter Overview Scheme

Chapter-1
Introduction: - It consists brief information about finance, banking
and deposit schemes.
Chapter-2
Research design: - It consists brief information about the design
adopted in preparing the project
Chapter-3
Profile of Bank: -It consists brief information about the banking
Chapter-4
Profile of Vijaya Bank: -It consists information about vijaya bank
Chapter-5
Analysis and interpretation: - It consists information about deposit
schemes
Chapter-6
Findings, recommendations and conclusions: - It consist findings,
recommendations for the findings and conclusions
Bibliography: -
Annexure :-

CHAPTER- 3
PROFILE OF THE BANK
Banking has existed ever since man-made money. Money lending,

which is one of the important function of banking is existed even than.
However, the function of the banking is not more about just money
lending it’s about deposits interest rates locker systems etc.
The banking system in our country comprises three constituents
public sector banks, private sector banks & foreign banks, there are 27
public banks, accounting for 81% of the total of all banks.
We have private sector banks, whose role has considerably
narrowed down after two-step nationalization. The number of private
banks stood at 34 as on 31st March, 1999 4172 branches.
Foreign banks in private sector are branches of banks
incorporated outside India. There are 44 such banks with 180 branches
on end March 1999.
The Indian commercial banks have played a significant role in the
economic development of the country. Be it branch expansion, deposit
Mobilization credit expansion, Minimizing regional imbalances or
promotion of new entrepreneur ship. The role of commercial banks is
considerable. There are shortcomings nevertheless. For e.g., The
banking services have not reached all parts of the country, loan recovery
has become a big problem for banks in efficiency & customer
complaints are common in banks & losses have become a way of life.

Banks often find it difficult to strike a balance between their commercial

compulsions & social obligation.
History of Banking:
Bank of Hindustan, setup in 1870, was the earliest Indian Bank,
banking in India on Modern lines started with the establishment of three
presidency banks under presidency banks act in 1876 i.e. banks of
Calcutta, bank of Bombay bank of madras. In 1921, all presidency
banks an alga mated to form the imperial bank of India. Imperial bank
of carried out limited central banking functions also prior to
establishment of RBI. It engaged in all types of commercial banking
business except dealing in foreign exchange.
Reserve Bank of India act was passed in 1934 & Reserve bank of
India was constituted as an apex bank with out major government
ownership. Banking regulation act was passed in 1949. This under
government control, under the act RBI got wide ranging powers for
supervision & control of banks. The act also vested licensing powers &
authority to conduct in- sections in RBI.
In 1955, RBI acquired control of the Imperial Bank of India, which
was renamed as state Bank of India. In 1959, SBI took our control of
eight private banks floated in the east while princely states, making
them as its 100% subsidiaries.
RBI was empowered in 1960, to force compulsory merger of weak
banks with the strong ones. The total number of banks was thus
reduced from 566 in 1951 to 85 in 1969. In July 1969, government

nationalized government nationalized 6 more banks were to make them

play the role of the catalytic agents for economic growth. The Norseman
committee report suggested wide ranging reform 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.
The banking scenario has changed immensely after the economic
liberalization & globalization. There is transformation from traditional
banking to modern multifaceted banking system in line with the need to
achieve rapid socio economic progress. There is a clear change in the
philosophy & techniques especially in the field of lending from whole
role nature to retail character of banking activities.
Today, the banking sector is facing severe computation. In order to
survive in this competitive environment, bank now focuses on creating
& delivering customer needed service in a customer-satisfying manner.
Meaning: A banking company has been defined under section 5 (1) ( c)

of the banking company regulation act of 1949, “any company transacts
the business of banking in India.
According to sec 5(1) (b) of the same act defines the banking has
“accepting for the purpose of lending or investment of deposits of money
from the public, repayable on demand or other wise & withdrawal by
cheques, drafts orders or other wise.
Role of Commercial Banks in a modern Economy:

Banks play significant role in the economic development of the

country. It can be seen from the following points.
1. Deposit Mobilization: Banks play significant role in mobilizing

the savings of people by initiating different deposit schemes by extending
a network of branches through out the country.
2. Granting of credit: Banks credit is essential for financing trade,

commerce, industry, agriculture & other productive activities. Banks
extend credit to this entire field in order to have economic development
of the country.
3. Creation of credit: Commercial banks can increase or decrease the

money supply in the country & inject elasticity in to the credit system
though their function is creation of money.
4. Channelise funds in to productive Investments: Banks not only and

fund but also ensure that funds are lend only for productive purpose by
monitoring properly.
5. Provision of finance to the Government: Banks provide short term

funds by purchasing trustee bills & long term funds by subscribing
government bonds provide finance to the government.

6. Protecting the funds of Depositor: Banks provides safety to the funds

of depositor by lending to different kinds of borrowers engaged in
different activities in different areas, to be invested in productive
projects & they also ensure that advances are properly secure & will
come bank in time
7. Provision of Remittance facility: Banks provide remittance facility

through remittance mechanism of bank drafts, mail transfers,
telegraphic transfers, traveler’s heaves, circular note etc., & help the
businessmen to secure funds when needed.
8. Provision of medium of exchange: Bank deposits, with draw by cheque

of transferable by credit transfers serves as a means of settlement of
debts by this it reduces use of legal tender money.
9. Discharge of social Responsibility: Banks have recognized their social

responsibility very well & now days they serve in the best interest of the
society at large. It is their bounder duly to grant credit to every section
of the society.
10. Innovative services: Modern banks under take a number of

innovative services like, merchant banking, underwriting of securities,
factoring, leasing , housing finance setting up of natural funds etc., for
the Economic development of the country.

Books of Accounts to be maintained by Banking Companies:
A banking company is received to maintain various ledger &

registers as per the requirement of the banking regulation act 1949. All
the books & register’s a banks has to maintain can be classified into the
following categories.
1. Principle ledgers
2. Subsidiary ledgers
3. Other registers & memorandum Books.
1. Principle ledger: A Banking company required maintain the following

principle books:
A. Cash Book: Which provide the summery of collection &
payments of the bank.
B. General ledger: General ledger provides details regarding
assets not covered under subsidiary books & also contains the
control accounts of subsidiary books.
2. Subsidiary ledger:
It Includes;
a. Receiving cash counter cash books
b. Paying cash counter cash books
c. Current accounts ledger
d. Saving bank account ledges
e. Fixed deposit account ledges

f. Investment ledger
g. Cash credit ledger
h. Loan ledger
i. Bills discount & purchased ledger
j. Receiving deposit account ledges
k. Fixed deposit account ledges
l. Customer’s acceptances, endorsement &
guarantee ledger etc.
3. Other registers & memorandum books:

It Includes:
a. Bills for collection register
b. Share security register
c. Jewelry register
d. Demand draft register
e. Safe custody register
f. Standing order register
g. Dishonored check register
h. Letter of credit register
i. Lockers register
Features of Bank Accounting:

Following are some of the feature of Bank accounting:

a. Banking companies have to maintain books of accounts under double
entry system
b. It has to maintain books of accounts as reserved under the provision
of banking regulation act.
c. The posting of transaction in the ledger will be based on deposit
credit slips.
d. Self-balancing system of ledger is followed in accounting by banking
companies.
PROJECT FINANCE DEPARTMENT:

Introduction: Project Finance Department {P F D} is a professional
outfit under the corporate credit wing {CCW} of Vijaya Bank. The
department consists of experienced professionals in the fields of finance
& technical offering various services in the area of corporate credit,
project appraisals, syndication of loan etc to corporate. The department
has successfully executed a variety of assignments in the past in the area
of project financing & other advisory services.
Range of services:
 Project advisory services: Review of project feasibility,
structuring of financing plans & advice on financial modeling &
preparation of project in f n memorandum.

 Syndication of financial requirements of customers. PFD offers

syndication services in arranging finance to customers funding
requirements.
OFD offers services to new projects or expansion of existing projects in
raising long term debts & or working capital limits. PFD offers
services to customers resorting to restructure their existing debt
profile by swapping high cost debt with low cost debt.
Anywhere banking:
Anywhere Banking is a technology based customer friendly service
designed to provide greater convenience to our customers.
With Anywhere Banking facility, once you have an account with any
of the select branches. You can operate it from any other designated
branch across as cities.
With anywhere banking you have a lost of facilities to make banking
with us.
Facilities:
Individuals / Joint account holder [operated severally]
maintaining current / SB / OD Accounts.
 Withdrawal of cash
 Remittance of cash
 Transfer of funds
 Balance Enquiry
 Issue of mini statement
 Depositing local cheques for collection

 Purchase of demand draft.

Firms / companies / other Bodies maintaining current / OD/ OCC
Accounts:
Transfer of funds between accounts from one anywhere banking
branch to another anywhere banking branch depositing of local cheques
for collection & crediting to the respective account at anywhere banking
branch.
Eligibility:
Account holders should have maintained a minimum average
balance of Rs 5000/- in SB Account & Rs 10000/- in current account in
the last six months.
Features:
Cash with draw unto Rs 50000/- per occasion Transactions permitted
on production of Identity card issued exclusively for ANYWHERE
BANKING Facility.
Facilities of both intra – city & inter – city transactions HOME
CLEARING – on line debit of cheques drawn on our own AWB
branches. DD issue – unto a limit of Rs 50000/- at any AWB branch.
Liquidity V/ S profitability:
Liquidity & safety principal aims at meeting demand of depositors
for cash in full & in time & is considered just one principle. That is

principle of liquidity but profitability aims at paying of a hand some

dividend to the shareholders.
The objectives of both the principals are complicating in their
nature. These words they are opposing considerations. The most liquid
assets if not at all profitable & the most profitable asset is least liquid.

CHAPTER-4
PROFILE OF THE VIJAYA BANK
INTRODUCTION:
Late Shri A.B.Shetty founded Vijaya Bank & other enter- praising
formers founded Vijaya Bank on 23rd October 1931 in Mangalore,
Karnataka the objective of the founders was essentially to promote
Banking habit. Thrift & entrepreneurship among the farming
community of Dakshina Kannada district in Karnataka state. The
bank become a scheduled bank in 1958, Vijaya Bank steadily grew into
a large all India bank with a smaller banks merging with it during the
1963-68. The credit for this merger as well as growth goes to late Shri
M.Sunder Ram Shetty, who was then the chief Executive of the bank.
The bank was nationalized on 15th April 1980 today, the bank has built a
network of 842 branches that span all 28 states & 4 union territories in
the country.
SHARE CAPITAL:
The share capital of Vijaya Bank is held by government of India
and institutional investor such as mutual funds UTI, Insurance
Company. Other finance institution & private corporate bodies, Indian
public NRI s And other commercials banks, Government of India acts

as a promoter of the bank, it assist & guides the bank in times of

financial difficulties.
The distribution of share holding as in 31 –3 – 2006 is given below.

Category No. of shares Amount in Rs % In
held total
A. Promoters holding 23,35,17,800 2,33,51,78,000 53.87
Government of India
B. Banks & financial institutions 1,77,43,420 17,74,34,100 4.09
(central /state institutions
Mutual Fund 1,67,24,545 16,72,45,450 3.86
Body corporate 1,37,73,148 13,77,31,480 3.18
NRI s locb s 6,21,38,548 62,13,85,480 14.33
Resident holdings 8,96,20,349 89,62,03,490 20.67
Total 43,35,17,800 4,33,51,78,000 100
Loans & Advances:

Vijaya Bank provides various types of loans & Advances to all the
classes of people. As its caption ‘Your partner in progress says the
services provides by the bank.

The different types of loan schemes provided

 Educational loans
 Rent scheme
 Liquidity Finance to SSI
 Jewel loans
 Loans for purchase of equipment
 Loans on motor vehicle
 Housing loan
 Advance to small road transport operators
 Finance for trading activities
 Loans for investment resumes
 Agricultural Finance
Branch Network :
In the year 1963-68 nine small banks merged with the Vijaya
Bank. During the year 2004-05 bank nationalized its branch network by
merging 16 branches with the nearby branches covered its regional
foreign exchange cell at Bangalore in to a specialized over seas branch,
as a result the total number of branches stood at 828 as at the end of 4 th
March 2005, as compared to 842 a year ago. During the year the banks
has offered 2 extension converters closed on extension counter upgraded
an extension counter into a full pledged branch.

On a international front the bank built a network relationship

with over 200 banks in 80 countries across America, Europe & middle
cast.
Computerization:
The bank has 87 computerized branches upgrading two partially
computerized branches to total computerization lacking the number of
totally computerized & branches to 328 & 10 respectively, converting
76.73 % of aggregate business of bank.
Credit cards:
Vijaya Bank given visa and master card credit for both
individuals & corporate. These cards are accepted at over 100000
members estimated across the country & Nepal.
Vijaya Bank credit cards come along with unique & attractive
feature like.
Vijaya Cash:
Instant cash withdrawal is available when ever needed. Walk – in to
any of 831 branches across the country draw unto Rs 5000 /- per month
for classic cards and Rs 10000 /- for gold cards through the passbook
supplied along with the card.
Vijaya Security:

Vijaya bank credit card brings along 24 hours personal accident

insurance coverage in the unfortunate event of the card holder death.
Classic card holders – upto Rs 100000

Gold card holders - up to Rs 200000 in case of Road accidents
Rs. 400000 in case of the Death an air crash.
Vijaya Family cards:

Vijaya Bank add on credit cards are available for parents, spouse
children of card holder above the 18 years of age regardless of his/her
income building under the add on is charged to the main card holder.
Board of directors:
The management of broad of the bank is vested with the board of
directors. Board of directors of Vijaya Bank other than director of
central Government elected under the terms of Vijaya bank general
regulations, 1998 & sec 9 (3) ( I ) of the banking companies act 1980 read
with the banking regulation act 1949 nationalized banks scheme 1980.
The present strength of board of directors of the bank is 7,
comprising of 1 executing & 6 non executive directors having diversified
professional experience. The directors have been contributing their
professional knowledge, experience & expertise in respective areas of
their specialization for the development.

Sl. Name of Director Designation Nature of Date of

No. Directorship Assuming
1 Shri M.S.Kapoor Chairman Executive 16-8-02

& Managing -Director
Director
2. Shri. M.S. Aftab Executive Director Executive 02-11-04
Director
3. Shri.A.K. RAi Nominee-GOI Non Executive 1-6-04

Director
4. Shri . S. P. Krishna Nominee- share Non-Executive 3-8-02
Swamy holders director
5. Shri ,R. Ashok Nominee- share Non – Executive- 3-8-02

Kumar Holder Director
6. Shri,A.Padmanabh Office Employee Non - Executive 16-9-04

a Shetty Director Director
7. Shri,P.Krishna Nominee -RBI Non- Executive 31-3-05

Murthy Director
8. Shri, B.K. Jagdish Nominee- share Non- Executive 3-8-02
chandra holders Director
9. Shri, S.Ananthan Nominee-Share Non-Executive 3-8-02
holder Director
10. Shri, Manivarjana workmen-director Non – Executive 3-8-02
S. Madinur Directors

CHAPTER-5
ANALISIS AND INTERPRETATION
Deposit : Deposit creation is an important function of commercial bank.

The bank attracts deposits from the people either by means offering
interest or other facilities business people want facilities with draw more
then investment.
Meaning : Deposits represents the amounts accepted by a bank from

the deposits it is the most important item on the liability side because
o They are major portion of the funds received by a Bank

o The capacity of a bank to earn profits depends on the
volume of deposits
o The efficiency of a bank is judged by its ability to attract
deposits.
Types of deposits : There are two types of deposits are :

Deposits
Term Deposits Demand Deposits
Fixed Recurring
Deposit Deposit Current
Account Deposit Saving Bank
A/c Deposits

Saving Bank Deposit scheme :

These are opened by middle & low income groups who save then
part of present income for future needs proper introduction is necessary
when accounts are operated by cheques. A low rate of interest provided
on the deposited money.
Terms and conditions in the savings bank deposit scheme :

Conditions which are required for opening Saving Bank Account
Savings Bank Account may be opened by the following, who are known
at the bank or are properly introduced by other.
 An individual in His / Her own name
 By more than one person in their joint names payable to all of
them jointly or any one of them or more than one or survivor’s
 By natural guardian of a minor on behalf of the minor or by a
person in the name of any minor of whom he or she is a guardian
appointed by a competent court. The guardian on behalf of a
minor should furnish a declaration as t the date of the birth of the
minor.
 By a minor over the age of 12 years in his own name in which case
the maximum balance in the minors account shall be restricted to
Rs 10000 / - only, provided the minor produces satisfactory proof
of his / her date of birth such as school certificate etc.
 By secretaries, Treasurers, managers or other duly constituted or
authorized officers of any club, school, orphanage, Temple,
Mosque, church or other religious / charitable institutions of like

nature provided the rules & by laws governing such institutions is

acceptable to the bank.
 Companies licensed by the central government under section 25 of
the companies Act 1956, & institutions, which are not liable to pay
income tax under income tax act 1961.
How to open savings Bank Deposit Account:

Persons desiring to open savings Bank Accounts are required to
fill in & sign application form [11-394] along with the usual specimen
signature cards, producing two pass port size photographs, details of
PAN / GIR numbers or declaration in form No 60161 as the case may be
& an introduction from a person acceptable to the bank .
Minimum Balance Amount Required to open An Savings Bank Account

A savings Bank A / C may be opened with a minimum balance of
Rs 250/ in fully computerized branches & Rs 100/- in other branches to
keep the account running . The same minimum balance should always
be maintained. If a cheque book is issued, the account shall have a
minimum balance of Rs 250/-.

The details are specific in a chart i.e. minimum balance / Amount

required to open an savings bank account
Minimum balance to be maintained
Fully computer ised Other
branches branche
s
For opening / maintaining SB Rs 250 /- Rs 100/-
Account [ with out cheque book]
For opening / maintaining Rs 250 /- Rs 250/-
savings bank a/c s [ with cheque
book facilities]
If the savings bank account shows balance below the minimum for a
continuous period of one year or above, the branch may at its discretion
close such Accounts.
Further Non – maintenance of minimum balance as stipulated above
attracts penalty charges are Rs 12/- per occasion.
Cheque Books : Cheque books shall be issued only against production

of duly signed requisition slip from the previous cheque book issued .

Restriction, conditions for with drawl’s in the Savings Bank Deposit

Account:
There is a restriction for the withdrawal of the amount in the
Savings Bank Deposit Account.
The total number of with drawls i.e. debit in Savings Bank
Account should not exceed 50 every half year. It is the obligation of the
account holder to take care of the cheque books issued to him or her.
Interest paid to Savings Bank Account :

Interest is allowed on the savings bank account on a half yearly
basis at the rate prescribed by the RBI on minimum monthly balance
between the 10th & the lost day of the month at the credit of each
account on a minimum balance of Rs 10/- & above & on multiple of Rs
10/- provided interest thus calculated does not fall short of Rs 1/- per
half year.
Interest will be calculated for the half year ending 31st January &
31st July each year & will be credited to each account on or before the
10th February & the 10th August respectively each year.
.

5.1 Table showing % & Increase / Decrease of saving’ s Bank

deposit Account
Years Total amount of % to the Base % of Increase

Deposit year / decrease
2001– 02 3,81,19,410 100% 0
2002-03 4,23,54,900 112% 12%
2003-04 4,70,61,000 124% 24%
2004-05 5,22,90,000 137% 37%
2005-06 5,81,00,000 152% 52%
INTERPRETATION:-
From the above table, we can observe that the amount deposited
in Saving Bank Account has been increased gradually from 2001-02 to
2005-06 . That is in the base year 2001-02 the % of deposit is 100% then
it has been increased to 112 % in the year 2002-03, 137% in 2004-05, &
152% in the year 2005-06.
We can analyse that the % of deposit in this deposit scheme is in
increasing trend, so, we can conclude that this scheme is performing well
in attracting the savings of the people.

5.1 Chart showing % & Increase / Decrease of saving’ s Bank deposit

Account
60%
52%
50%
37%
40%
30% 24%
20%
12%
10%
0%
0%
2001– 2002 2002– 2003 2003 – 2004 2004 – 2005 2005– 2006
% of Increase/ decrease

5.2 Table showing New Account opened in Savings Bank Account.
Years Total no. of % to the Base year % of Increase

persons / decrease
Deposited
2001– 02 3500 100% 0
2002-03 3650 104% 4%
2003-04 3980 114% 14%
2004-05 4390 125% 25%
2005-06 4630 132% 32%
INTERPRETATION:-
From the above table, we can observe, that the no. of persons
deposited in saving Bank A/c has been increased gradually from 2001-02
to 2005-06 . That is in the base year 2001-02the % of Deposit is 100%
,then it has been increased to 104% in the year 2002-03, 114 % in the
year 2003-04 125% in 2004 –05 , & 132% in the year 2005-06.
We can Analyse that the % of no. of persons deposited in this
scheme is in increasing trend, so, we can conclude that this scheme is
performing well in attracting the saving of the people.

5.2 Chart showing New Account opened in Savings Bank Account.
0.35 32%
0.3
25%
0.25
0.2
14%
0.15
0.1
4%
0.05 0
0
2001 – 2002 2002– 2003 2003 – 2004 2004 – 2005 2005 – 2006

5.3 Table showing total interest amount paid by the bank to savings
Bank Deposit holders.
Years Total amount Rate of interest Interest amount

deposited paid by the bank
2001– 02 3,81,19,410 3.5% 13,34,179.35
2002-03 4,23,54,900 3.5% 14,82,421.5
2003-04 4,70,61,000 3.5% 16,47,135.0
2004-05 5,22,90,000 3.5% 18,30,150.0
2005-06 5,81,00,000 3.5% 20,33,500.0
INTERPRETATION:-
n atFrom the above table, we can observe that the interest amount
paid by Bank to Saving Bank A/c holders it has been increased
gradually from 2001-02 to 2005-06 that is in the base year 2001-02 the
amount of interest is 13,34,179.35 . Then it has been increased to
14,82,421.5 in the year 2001-02, in the year 2003-2004 the amount of
interest is Rs 16,47,1`35 & in the year 2004-05 the amount is 18,30,150 &
in the year 2005-06 the amount paid is Rs 20,33,500.
We can analyse that the interest amount of deposit in its scheme is
in increasing trend, so we can conclude that this scheme is performing
well attracting the savings of people.
5.3 Chart showing total interest amount paid by the bank to savings
Bank Deposit holders.

2033500.00 1334179.35
1482421.50
1830150.00
1647135.00
2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006
5.4. Table showings percentage paid by the bank in savings Bank

Account

Years Total interest % to the Base % of Increase

amt paid year / Decrease
2001 – 02 13,34,179.35 100% 0
2002-03 14,82,421.5 116% 10%
2003-04 16,47,135.0 123 % 23%
2004-05 18,30,150.0 137% 37%
2005-06 20,33,500.6 152 % 52%
INTERPRETATION:-
From the above table, we can observe that the interest amount in
saving Bank A/c has been increased gradually from2001-02 to 2005-06.
I,e in in the base year 2001-02 the % of interest amount is 100%, then it
has been increased to 110% in the year 2002-03, 123% in the year 2003-
04, 137% in 2004-05 & 152%in the year 2005-06
We can Analyse that the % of interest amount in this deposit
scheme is in increasing trend, so we can conclude that this scheme is
performing well in attracting savings of the people.
5.4. Chart showings percentage paid by the bank in savings Bank

Account

60% 52%
50%
37%
40%
30% 23%
20%
10%
10%
0%
0%
2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006
2. Current Account:
These are opening by trading & industrial concern a minimum
deposit of Rs 200000 Rs 300000 through proper and satisfactory
introduction rate of interest is not provided here, customers can deposit

any amount of money and any number of times and withdraw & as
many times as they want.
Terms & conditions in current Account :
Conditions required for opening current Account :-

The following persons, firms etc who are properly introduced,
may open current account by singing the prescribed account opening
form [s] along with PAN / GIR numbers or declaration in form No.
60/61
 An individual in his / her own name

 More than one individual in their joint names payable to all of
them jointly or any one or more of them or survivor [s]
 A Hindu undivided Family, a proprietor ship concern, a
partnership firm, a company, a trust, a local body, government
department etc., in its own name by giving clear operational
instructions.
Obtaining of photographs :
In terms of reserve Bank of India’s guidelines, photograph should be
given at the of opening of all categories of deposit of opening of all
categories of deposit accounts includes current account of both resident
& Non resident account holders inclusive of persons authorized open /
operate the accounts as application.

Minimum Balance Amount Required to open an Current Account:

A current Account may be opened with a minimum of Rs 1000/- in
fully / partially computerized branches & Rs 500/- in other branches.
However at specialized commercial & branches irrespective of the
location of the branches. However at specialized commercial & personal
banking branches this is Rs 10,000/- for Current Accounts. If the
prescribed minimum balance is not maintained in the current account
Rs 28/- per occasion with a maximum of Rs 500/- per month will be
collected.
Interest on credit Balance : Interest is not allowed on the credit balance

maintained in current accounts.
Incidental / falio / Handing charges

Bank will collect charges for the ledger folios used in current
accounts at the rate prescribed below :
Rs 66/- per ledger page [ 40 entries or part their of considered as
one ledger page ] & Rs 83/- per computer statement sheet on a half -
yearly basis subject to the concession provided on maintained of average
balance
Average credit Balances Free ledger Folio pages
allowed per year

Up to Rs 25000 Nil

Above 25000/- unto Rs 50000/- 3

Above Rs 50000.- Unto Rs 100000/- 6
Above Rs 100000 /- up to Rs 200000/- 11
Above Rs 200000/- All

5.5 Table showing % of Increase / Decrease of current Account

Years Total amount % to the Base % of Increase
deposited year / decrease
2001– 02 11, 90 000 100% 0

2002-03 13, 94 000 117% 17%
2003-04 14, 45, 000 121% 215
2004-05 15,64,000 131% 31%
2005-06 17,00,000 1425 42%
INTERPRETATION:-
From the above table, we can observe that the amount
deposited in current account has been increased gradually from
2001-02 to 2005-06 . That is in the base year 2001 – 02 to 2005-06.
That is in the base year 2001-02 the % of deposit is 100% . Then it
has been increased to 117 % in the year 2002-03, 121 % in the
year 2003-04, 131 % in 2004-05 & 142 % in the year 2005-06.
We can Analyse that the % of deposit in this deposit scheme
is in increasing trend, so, we can conclude that this scheme is
performing well in attracting the savings of the people.

5.5 Chart showing % of Increase / Decrease of current Account
42%
45%
40%
35% 31%
30%
25% 21%
17%
20%
15%
10%
0%
5%
0%
2001– 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006

5.6 Table showing New Accounts opened in Current Account.
Years Total % to the Basic % of Increase

interest amt year / decrease
paid
2001– 02 50 100% 0
2002-03 85 170% 70%
2003-04 94 188% 88%
2004-05 108 216% 116%
2005-06 122 244% 114%
INTERPRETATION:-
From the above table, we can observe that the No, of
persons deposited in current A/c has been increased gradually
from 2001-02 to 2005-06. That is the base year 2001-02 the % of
deposited persons is 100% . Then it is increased to 170% , it is
creased to 188 % in the year 2003-04, in 2004-05 it has been
increased to 216 % & in 2005-06 it has been increased to 244%.
We can Analyse that the % of No, of persons deposited in
this scheme is in increasing trend, so, we can conclude that this
scheme is performing well in attracting the current A/c of the
people.
5.6 Chart showing New Accounts opened in Current Account

116% 114%
120%
100% 88%
80% 70%
60%
40%
20%
0%
0%
2001– 2002 2002– 2003 2003 – 2004 2004 – 2005 2005 – 2006

TERM DEPOSIT
Recurring deposit Account : These deposits are meant for people who
have regular monthly incomes. Deposited amounts will be in the
multiples of Rs 5 & Rs10. Here the depositor deposits a fixed sum of
money every month for an agreed period & at the end of the specific
period the deposited money along with the interest can be with drawn.
This scheme helps in savings easily & systematically, through
either fixed or variable monthly installments. You can choose any
deposit period ranging from 6 to 120 months, in completed 3 months.
Under variable monthly installments you have the option to choose a
core monthly installment [ witha minimum of Rs 10/- or multiples] and
remit any amount subject to this minimum with a maximum of ten times
of the more monthly installment.
It is one form of savings deposits . Depositor save & deposit
regularly every month a fixed installment so that they are assured of the
sizeable amount at a later period. There will enable the depositors at
meet contingent expenses. Banks have found these deposits popular.
Many people would not have saved if these deposits had not been
introduced this deposit works on the maxim “little drops of water make
a big ocean “.
Terms & conditions for opening account:

Any person can open this deposit account he can even have more
than one account at a time. This account can be opened joint names
also.
It may be opened for monthly instilments in sums of Rs 5/- or in

multiples of Rs5/- with a maximum of Rs 1000/- the number of monthly
instilments may very from 12 months to 72. The total amount is
repayable 30 days after the last installment has been paid.
For deposits of higher installments. The maturity amounts can be
calculated as multiples of the maturity amount for an installment of Rs5.
Every depositor should pay the monthly installments with in 30
days from the due date. If he fails to do so, interest will be charged on
the installments in arrears the rate of 4 paisa for every Rs5/- per month.
A recurring deposit holder can get a loan on the security of a
recurring deposit. The banker may grant 75 % of the total amount paid
as loan & the interest of 2% over the recurring deposit rate is charged.
These accounts are transferable from one branch ot another. A
recurring deposit holder is given the recurring deposit pass book for his
verification. The rate of interest is similar to the rate offered on fixed
but it is compounded

5.7 Table showing % of increase / Decrease recurring deposit account.
Years Total Amount % to the Base % of Increase

Deposited year / decrease
2001– 02 2,47,200 100% 0
2002-03 2,87,800 116% 16%
2003-04 2,88,400 117 % 17%
2004-05 3,70,300 150% 50%
2005-06 4,12,000 166 % 66%
INTERPRETATION:-
From the above table we can observe that the amount
deposited in recurring deposit A/c has been increased gradually
from 2001-02 to 2005—06 that is in the base year 2001-02 the %
of deposit is 100% , then it has been increased to 116% , & 117%
in the year 2003-04, 150% in 2004-05 , 166% in the year 2005-06.
We can analyse that the % of deposit is this deposit scheme
is in increasing trend; so, we can conclude that this scheme is
performing well in attracting the savings of the people.

5.7 Chart showing % of increase / Decrease recurring deposit account
66%
70%
60%
50%
50%
40%
30%
16% 17%
20%
10% 0%
0%
2001 – 2002 2002 – 2003 2003 – 2004 2004– 2005 2005 – 2006

5.8 Table showing new Account opened in recurring deposit account .
Years No. person % to the Basic % of Increase

2001– 02 0 0 0
2002-03 8 100% 0
2003-04 17 212.5% 112.5 %
2004-05 24 300% 200%
2005-06 28 350% 250%
INTERPRETATION:-
From the above table, we can observe that the no. of persons
deposited in recurring deposit A/c has been increased gradually from
2001-02 The % of deposited persons in Nil, i.e. there is no person
invested their money in the recurring deposit A/c. Then it has been
increased to 100% in the year 2002-03, 212.5% in the year 2003-04 &
300% in 2004-05 & in the 2005-06 it has been increased to 350%.
increasing trend. So, we can conclude that this scheme is performing
well in attracting the savings of the people.

5.8 Chart showing new Account opened in recurring deposit account
250%
250%
200%
200%
150%
112.50%
100%
50%
0% 0%
0%
2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006

5.9 Table showing total interest amount paid by bank on the recurring
deposit account.
Years Total interest % to the Basic % of Intrease

amt paid year / decrease
2001– 02 2,47,200 3.5 % 8652

2002-03 2,87,400 3.5% 10073
2003-04 2,88,400 3.5% 10094
2004-05 3,70,300 3.5% 12978
2005-06 4,12,000 3.5% 14420
INTERPRETATION:-
From the above table, we can observe that the interest amount paid
by Bank to recurring deposit A/c holders it has been gradually increased
from 2001-02 to 2005-06. That is in the base year 2001-02 the amount of
interest is 8652, then it has been increased to 10073 in the year 2002-03,
10094 in the year 2003-2004, 12978 in the year 2004-05 14420 in the year
2005-06.
We can analyse that the interest amount of deposit in this scheme

is in increasing trend, so we can analyse that this scheme is performing
well in attracting the savings of the people.

5.9 Table showing total interest amount paid by bank on the recurring
deposit account.
8652.00
14420.00
10073.00
12978.00
10094.00
2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006

5.10 Table showing % Percentage paid by the bank in recurring deposit

account.
Years Interest amt paid % to the Basic % of Increase

year / decrease
2001– 02 8652 100% 0
2002-03 10073 116% 16%
2003-04 10094 117 % 17%
2004-05 12978 150% 50%
2005-06 14420 166 % 66%
INTERPRETATION:-
Form the above table we can observe that the interest amount in
recurring deposit account has been increased gradually from 2001-02 to
2005-06 , That is in the base year 2001-02 the % of interest amount is
100% Then it has been increased to 116% in the year 2002-03, 117% , in
the 2003-04 , 150% in the year 2004-05 & 166% in the year 2005-06.
We can analyse that the % of interest amount in this deposit

scheme is in increasing trend, so we can conclude that this scheme is
performing well in attracting savings of the people.

5.10 Chart showing % Percentage paid by the bank in recurring deposit

account.
66%
70%
60%
50%
50%
40%
30%
16%
17%
20%
10% 0%
0%
2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006
Fixed Deposit Account : [ Term Deposits]

These are operated by small investments by depositing fixed

amount fixed periods fixed rate of interest. The deposited money is with
drawn after the expiry of fixed receipt issued by the bank at the time of
opening account.
A fixed deposit is one which is repayable after the expiry of a
predator mined period fixed by the customer himself. The period varies
from 15 days to 3 years. A deposit account can be opened fro a period of
more than 3 years & in that case the rate of interest remains the same
level. These deposits are not payable on demand but they are
withdrawal subject to a period of notice. Hence it is called as term
deposits.”
Terms & conditions to the fixed deposit account:
Opening Account:
The fixed deposit holder is expected to fill up an application form
prescribed fro the purpose, stating the amount & the period of deposit.
The application itself contains the rules & regulations of the deposit in
addition to the space for specimen signature. As in opening a correct
account, a banker does not insist upon a letter of introduction or
reference for fixed deposit account because of the absence of frequent
transaction on the account.
Interest :

The interest rate offered on the fixed deposit is so attractive that it

has resulted in a change in the composition of bank deposits. Till
recently, most of the deposits of commercial banks has been demand
deposits & new fixed deposits occupies more than 70% of bank deposits.
The rate of interest varies according to the period of deposit. In Indian
banking history the firs ever highest interest rate of 15% was offered on
term deposits for 1-2-97 on wards,
However, in recent times, the RBI, has deregulated the interest
rates on fixed deposit. The banks are given the freedom to fix their own
rates for different periods.
How ever the special rates have been fixed for deposits of senior
citizens of 60 years of age or above giving them some schemes.
The present rates applicable to the fixed deposits in case of senior
citizens.
Serial Term of deposit 1 years to less than 2 Interest per
No. years Annum
1 1 years to less than 2 years 6%
2 2 years to less than 3 years 7%
3 3 years & above 7.5%

Table showings the present interest paid by the bank to fixed deposit
holder for different periods.
Serial Term of deposit 1 years to less than Interest per
No. 2 years Annum
1 1 day to 14 days Nil
2 15 days to 45 days 4.25%
3 46 days to 179 days 5%
4. 139 days to 1 years 5.5 %
5. 1 years to 3 years 5.75%
6. 3 years & above 6%
Period of the deposit ;

The minimum period has been fixed as low as 7 days, A per the
guidance of the Indian banks Association , banks should not accept
deposits for a period longer than 10 years. If the maturity date of fixed
deposit fassa a holiday, it should be paid only on the succeeding working
day, since a fixed deposit not be claimed before the maturity date as per
the terms of original contract.
Fixed deposit receipt ;

At the time of opening the deposit account, the banker issued a
receipt acknowledging the receipt of money on deposit account. It is
popularly known as F.D.R [Fixed Deposit Receipt]. It contains the
amount of deposit, the name of the holder of the deposit, the rate of
interest, due date etc. On the reverse side of the F.D.R separate columns
are provided for making entries regarding interest.
Particular of A. F. D. R

1. Name of the bank & place

2. Due Date
3. Date
4. Name of the Depositor
5. Amount
6. Period
7. Interest Rate
8. Signature of the manager
Fixed Deposit Receipt
{Face View}
VIJAYA BANK ITD

No: 12345 Due on
VIJAYANAGAR Branch
Date ……………..2006
Received from ------------------------------------------------------------------
Rupees --------------------------------------as fixed deposit repayable
in -------------------------months after date with interest at the rate
----------------% per Annum
RS Accountant Manager

Back View of V.D.R
Memorandum Payment of Interest

1. This F.D.R dully discharged should Date Half Amount Signature
be surrendered at the time of payment year of
or renewal of deposit. To prevent loss ended Authorized
of interest, the receipt intended for person
renewal should be sent on due date
2. The F.D.R is not transferable by
endorsement. In the absence of special
instructions . The amount of F.D.R
can be paid only to the depositor in
person.
3. Rate of interest overleaf is subject
to resource bank P directive issued
from time to time.
Received payment / please renew
…….. month / years
Signature of the depositors

5.11 Table showing % of increase / decrease of savings Bank deposit

account
Years Total amount % to the Basic % of Increase

2001– 02 7995000 100% 0
2002-03 9225000 115% 15%
2003-04 10086000 126% 26%
2004-05 10455000 130% 30%
2005-06 12300000 154% 54%
INTERPRETATION:-
From the above table, we can observe that the amount deposited
in fixed deposit account has been increased gradually from 2001-02 to
2005-06 that is in the base year 2001-02 % of deposit is 100% . Then it
has been increased to 115%in 2002-03 , 126% in 2003-04 , 130% in
2004-05 , 154% in 2005-06.
increasing trend. So, we can conclude that this scheme is performing
well in attracting the deposits of people.

5.11 Table showing % of increase / decrease of savings Bank deposit

account
60% 54%
50%
40%
30%
30% 26%
15%
20%
10%
0%
0%
2001– 2002 2002 – 2003 2003– 2004 2004– 2005 2005– 2006
5.12 Table showing new accounts open in fixed deposit account.

Years Total interest % to the Basic % of Increase

amt paid year / decrease
2001 – 02 98 100% 0
2002-03 115 117% 17%
2003-04 140 143% 43%
2004-05 158 161% 61%
2005-06 165 168% 68%
INTERPRETATION:-
From the above table, we can observe that the No. of persons
deposited in fixed deposit A/c has been increased gradually from 2001-
02 to 2005-06. That is in the base year 2001-02 the % of deposit is
100% . Then it has increased to 117%in 2002-03 , 143% in 2003-04 ,
161% in 2004-05 , 168 % in the year 2005-06
We can analyse that the % of No, of persons deposited deposited

in this scheme is in increasing trend, so, we can conclude that this
scheme is performing well in attracting the savings of the people.
5.12 Chart showing new accounts open in fixed deposit account.

68%
70%
61%
60%
50% 43%
40%
30%
17%
20%
10% 0%
0%
2001– 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006
5.13 Table showing total interest rate amount paid by bank to F.D
holder who deposit their money for the period of 15-45 days.

Years Amount Term of Rate of Total

interest
Deposited Deposit Interest amount
2001 – 02 7995000 15-45 days 4.25 % 339787.5
2002--03 9225000 15-45 days 4.25 % 392062.5
2003--04 10086000 15-45 days 4.25 % 428655.0
2004--05 15,64,000 15-45 days 4.25 % 444337.5
2005--06 17,00,000 15-45 days 4.25 % 522750
INTERPRETATION:-
From the above table, we can observe that the interest amount
paid by bank to fixed deposit holders for the period of 15-45 days is
increased gradually from 2001-02 The amount of interest is 339787.5 ,
then it has been increased to 392062.5 in 2002-03, 428655.0 in 2003-04 ,
444337.5 in 2004-05, 522750 in the year 2005-06.
increasing trend, so, we can conclude that their scheme is performing
well in attracting deposits from people.
5.13 Chart showing total interest rate amount paid by bank to F.D
holder who deposit their money for the period of 15-45 days.

522750.00 339787.50
392062.50
444337.50
428655.00
2001– 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006
holder who deposit their money for the period of 46 to 179 days.
interest
Deposited Deposit Interest

amount
2001 – 02 7995000 46 to 179 days 5% 399750
2002--03 9225000 46 to 179 days 5% 461250
2003--04 10086000 46 to 179 days 5% 504300
2004—05 10455000 46 to 179 days 5% 522750
2005—06 12300000 46 to 179 days 5% 615000
INTERPRETATION:-
paid by bank to the fixed deposit holders for the period of 46 to 179 days
is increased gradually from 2001-02 to 2005-06 that is in the base year
2001-02 interest amount is 399750, then it has been increased to 461250
in the year 2002-03, 504300 in the year 2003-04 , 522750 in the year
2004-05, 615000 in the year 2005-06.
holder who deposit their money for the period of 46 to 179 days.

615000.00 399750.00
461250.00
522750.00
504300.00
2001– 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005– 2006
holder who deposit their money for the period of 180 days t 1 year.

Deposited Deposit Interest interest

amount
2001 – 02 7995000 180 to 1 year 5 .5% 439725
2002--03 9225000 180 to 1 year 5 .5% 507375
2003--04 10086000 180 to 1 year 5 .5% 554730
2004—05 10455000 180 to 1 year 5 .5% 575025
2005—06 12300000 180 to 1 year 5 .5% 676500
INTERPRETATION:-
From the above table , we can observe that the interest amount
paid by bank to the fixed deposit holders for the period of 180 to 1year is
increased gradually from 2001-02 to 2005-06 that is in the base year
2001-02 interest amount is 439725, then it has been increased to 507375
in the year 2002-03, 554730 in the year 2003-04 , 575025 in the year
2004-05, 676500 in the year 2005-06.

holder who deposit their money for the period of 180 days t 1 year.

676500.00 439725.00
507375.00
575025.00
554730.00
2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006
holder who deposit their money for the period of 1 year to 3 years
Years Amount Term of Deposit Rate of Total

Deposited Interest interest

amount
2001 – 02 7995000 1 year to 3 years 5 .75% 4,59,712.5
2002--03 9225000 1 year to 3 years 5 .75% ,30,437.5
2003--04 10086000 1 year to 3 years 5 .75% 5,79,945.0
2004—05 10455000 1 year to 3 years 5 .75% 6,01,162.5
2005—06 12300000 1 year to 3 years 5 .75% 7,07,250.0
INTERPRETATION:-
paid by bank to the fixed deposit holders for the period of 1year to 3
years is increased gradually from 2001-02 to 2005-06 that is in the base
year 2001-02 interest amount is paid by bank is 459712.5 , then it has
been increased to 530437.5 in the year 2002-03, 579945.0 in the year
2003-04 , 6,01,162.5 in the year 2004-05, 7,07,250.0 in the year 2005-06.

holder who deposit their money for the period of 1 year to 3 years

459712.50 30437.50
707250.00
579945.00
601162.50
2001– 2002 2002 – 2003 2003– 2004 2004 – 2005 2005 – 2006
holder who deposit their money for the period of 3 years & above.

Deposited Interest interest

amount
2001 – 02 7995000 3 years & above 6% 479700
2002--03 9225000 3 years & above 6% 553500
2003--04 10086000 3 years & above 6% 605160
2004—05 10455000 3 years & above 6% 627300
2005—06 12300000 3 years & above 6% 738000
INTERPRETATION:-
paid by bank to the fixed deposit holders for the period of 3 years &
above is increased gradually from 2001-02 to 2005-06 that is in the base
year 2001-02 interest amount is paid by bank is 479700 , then it has
been increased to 553500 in the year 2002-03, 605160 in the year 2003-04
, 627300 in the year 2004-05, 733000 in the year 2005-06.
holder who deposit their money for the period of 3 years & above.

738000.00 479700.00
553500.00
627300.00
605160.00
2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006

holder who deposit their money for the period of 1 day to 14 days .

interest
Deposited Interest amount
2001 – 02 7995000 1-14 days Nil 7995000
2002--03 9225000 1-14 days Nil 9225000
2003--04 10086000 1-14 days Nil 10086000
2004—05 10455000 1-14 days Nil 10455000
2005—06 12300000 1-14 days Nil 12300000
INTERPRETATION:-
From the above table , we can observe that the interest amount paid
by bank to the fixed deposit holders for the period of 1-14 days is
increased gradually from 2001-02 to 2005-06 that is in the base year
2001-02 interest amount is paid by bank is 7995000 in this scheme there
is no interest for this scheme period of deposited is less so there is no
interest.

holder who deposit their money for the period of 1 day to 14 days .
12300000 7995000
9225000
10455000
10086000
2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005 2005 – 2006
Vijaya Cash Certificate :

It is scheme which introduced by the Vijaya bank it is the scheme

in the fixed deposit account . The name itself says its belong to the
Vijaya bank.
Vijaya cash certificate scheme is a convenient way to save for your
children’s higher education or to build a house etc.,
This scheme helps you to build on your capital along with the
benefit of compound interest. Available in denominations of Rs 100/- &
multiple there of, you can choose certificate for any period ranging from
6 months to 10 years.
Terms & conditions required
 There is no restriction to take the Vijaya cash certificate.

 No need of introduction because it is fixed for a particular
period.

5.19 Table showing % of increase/ decrease of Vijaya cash certification
Years Total amount of % To the Basic year % Of Increase

Deposits / Decrease
2001 – 02 17435000 100% 0
2002-03 20605000 118% 18%
2003-04 23775000 136% 36%
2004-05 30115000 172% 72%
2005-06 31700000 182 % 82%
INTERPRETATION:-
From the above table, we can observe that the amount deposits in
the Vijaya cash certificate has been increased gradually from 2001-02 to
2005-06 that is in the base year 2001-02 the % then it has been
increased to 118% in the year
2002-03, 136% the year 2003-04, 172% the year 2004-05, 182% the year
2005-06.

5.19 Chart showing % of increase/ decrease of Vijaya cash certification

90% 82%
80% 72%
70%
60%
50%
36%
40%
30% 18%
20%
10% 0%
0%
2001-2002 2002-2003 2003-2004 2004-2005 2005-2006

5.20 Table showing No. of persons deposited their money in vijaya cash
certificate
INTERPRETATION:-
Years No. of persons % To the % Of Increase

Deposits Basic year / Decrease
2001 – 02 460 100% 0
2002-03 499 108% 8%
2003-04 550 120% 20%
2004-05 580 126% 26%
2005-06 630 137% 37%
From the above table , we can observe that the amount deposits in
the Vijaya cash certificate has been increased gradually from 2001-02
to 2005-06 that is in the base year 2001-02 the % of deposit is 100%.
Then it has been increased to 108% in the year 2002-03, 120% the year
2003-04, 126% the year 2004-05, 137% the year 2005-06.
We can analyse that the % of No. of parsons deposit i scheme is in


5.20 Chart showing No. of persons deposited their money in vijaya

cash certificate
40% 37%
35%
30% 26%
25% 20%
20%
15%
8%
10%
5% 0%
0%
2001-2002 2002-2003 2003-2004 2004-2005 2005-2006

5.21 Table showing total interest amount paid by bank to Vijaya cash
certificate holders:
Years Amount % To the Basic % Of Increase
Deposits year / Decrease
2001 – 02 1,74,35,000 6% 10,46,100
2002-03 20,60,5000 6% 12,36,300
2003-04 2,37,75,00 6% 14,26,500
2004-05 3,01,15000 6% 18,06,900
2005-06 3,17,00,000 6% 19,02,000
NOTE:
In this table the Tate of interest will be taken 6% if a person
deposited amount for 3 years & above. If the period differs rate of
interest also differs.
INTERPRETATION:-
paid by Vijaya bank cash certificate holders it has been increased
gradually from 2001-02 to 2005-06 that is in the base year 2001-02
interest amount is paid by bank is 10462100, then it has been increased
to 1236300 in the year 2002-03, 1426500 in the year 2003-04, 18,06,900 in
the year 2004-05, 19,02,000 in the year 2005-06.
We can analyse that the amount deposit i scheme is in increasing
trend, so, we can conclude that this scheme is performing well in
attracting the savings of the people.

5.21 Table showing total interest amount paid by bank to Vijaya cash
certificate holders:
1046100
1902000
1236300
1806900 1426500
2001-2002 2002-2003 2003-2004 2004-2005 2005-2006

5.22 Table showing percentage paid by the bank to the Vijaya cash
certificate holders.
Years Amount % To the Basic % Of Increase

Deposits year / Decrease
2001 – 02 10,46,100 100% 0
2002-03 12,36,300 118% 18%
2003-04 14,26,500 136% 36%
2004-05 18,06,900 172% 72%
2005-06 19,02,000 182% 82%
INTERPRETATION:-
From the above table, we can observe that the amount deposits in
the Vijaya cash certificate has been increased gradually from 2001-02
to 2005-06 that is in the base year 2001-02 the % of deposit is 100%.
Then it has been increased to 11% in the year 2002-03, 136the year
2003-04, 172% the year 2004-05, 182% the year 2005-06.
We can analyse that the amount deposit i scheme is in increasing

trend, so, we can conclude that this scheme is performing well in
attracting the savings of the people.
5.22 Chart showing percentage paid by the bank to the Vijaya cash
certificate holders.

90% 82%
80% 72%
70%
60%
50%
36%
40%
30% 18%
20%
10% 0%
0%
2001-2002 2002-2003 2003-2004 2004-2005 2005-2006
Various Deposit Schemes of Vijaya Bank:

V stars deposit schemes: It is also called as an innovative

deposit scheme. Savings band account holders who maintain a
minimum monthly balance of Rs 5000/- during the
preceding six months are eligible for any one of the following loans at
concessional rates of interest viz at 1.5% lower than the normal rate
applicable to respective scheme subject to a minimum of the banks
primes lending rate.
 A term loan equivalent to 4 times the average monthly minimum

balance for the proceeding 6 months subject to maximum of Rs
50000 for purchase of house hold articles / consumer durables.
 Loan under “U –cash or V- equip schemes subject to eligibility an
the schemes.
Vijayashri Units:
This scheme is devised to meet the needs of diverse investors like
individuals, institutions, professions, executives, entrepreneurs,
housewives, and farmers among others.
Vijayashree units combine the features of a term deposit in terms
of higher interest rates, & the facility for partial withdrawal in units of
Rs 1000/-
Vijayashree units are issued for Rs. 1000/- & multiples there of .
The scheme has no maximum limits & interest compounded on a
quarterly basis. If the period of deposit exceeds 3 months.

This is a convenient banking scheme where an authorized Jeewan

Nidhi agent collects the money you wish to deposit at your door ship.
This scheme promotes savings habits among children, house
wives, professionals, salaried people, shop keepers, small traders &
businessmen.
Individuals can choose a deposit period of 12, 39 or 63 months,
with a daily deposit, as low as Rs 1/-
CAPITAL GAINS ACCOUNTS SCHEME:

This is also a one of the scheme of the Vijaya Bank.
 Under this scheme an income tax, assesee can avail of the benefit
of exemption from capital gains if the amount of capital gains or
the net consideration is deposited in any branch [other than the
rural branches] on or before the due dates of their filing return of
income.
 The income tax assesses who are eligible for exemption under
section 54 , [54B, 54D, 54 F or 54 G] of the income tax act 1961
may open “Account A” which is in the form of savings bank
account or account B which is in the form after deposits with an
option to the depositors to keep the deposit as cumulative or non
cumulative deposit.
 Depositor desirous of opening an accounts under the scheme for
the first time shall apply in form “A” in duplicate, obtaining the
application from the nearest branch.
 Opening of joint account is not permissible under the scheme.

 Deposits may be made in one lump sum or in stages at any time on

or before the due date of furnishing the return of income under
sub section [1] of section 139 of ht act
 In case of deposit under account “A’ the depositor will be issued
with a pall book where in all amounts of depositor withdrawals
together with interest due shall be entered under the signature of
the authorized officer of the branch. In the case of deposit under
Account “B: a deposit receipt with principal amount of deposit ,
date of deposit , rate of interest, date of maturity of deposit etc.
will be issued to the depositor.
 Chaque book facilities are not permitted at {GA – Account A in
view of the system of withdrawal prescribed under the scheme.
 The minimum period of maturity of the deposits in account “B” is
15 days & maximum is for any number of years However in the
case of these accounts exemption may be available to the tax payer
only if the capital gains are utilized within a specified period as
per the provisions contained in sections 54, 54B, 54D, 54E & 54 G
of income tax Act.
The interest rate to be paid in Account ‘A” [i.e. savings Bank

account] under capital gains A/c scheme, 1988 shall be the same as given
for savings & bank A/c effective from march 01, 2003,. The rate of
Applicable for account “B” [i.e term deposit A/c] under this scheme will
be as per the interest rates commerical by the bank through deposit
interest rate from time to time.

[NRF] Non-Resident Foreign Currency:

A person resident in India may open, hold & maintain with &
Authorized dealer in India a resident foreign currency [domestic]
Account, our of foreign exchange acquired in the form of currency
notes, bank notes & travelers cheques.
RFC [Domestic] Account can be maintained for the time being in
the form of non-interest bearing current account only with cheque
facility.
Credits to the account:

 Following credits are allowed in RFC [domestic] Accounts:
 Foreign exchange acquired by the account holder from any
of the sources stated below :
 While on visit to any place outside India by way of payment
for services not creasing from any business in or anything done in
India.
 From any person, not resident in India 7 who is on visit to
India, as honorarium of gift of for services rendered or in
settlement of any lawful obligations.
 By way of honorarium or gift while on a visit to any place
outside India.
 Represents unspent amount of foreign exchange acquired by
him from an authorized person travel abroad.

 As a gift from a close relative: For the purpose of this clause,

“close” “relative” means relatives as define! In section 6 of the
companies Act, 1956.
 By way of earnings export of goods services, or as royalty,
honorarium of by any other lawful means
 Representing the disinvestment proceeds received by the
resident account holder on conversion of shares held by hi to
ADR’s /GDRs
Debits to the account:

The funds in a RFC [Domestic] amount are free from all
restrictions regarding utilization of ht foreign currency balances
including any restriction on investment out side India. Definition of
close relatives [As defined in the companies Act] two persons shall be
deemed to be relatives if & only if:
 They are members of Hindu undivided

Family
 They are husband & wife
 The one or the spouse of the one is related
to the other or the spouse of the other as parent & child
grand parent & grandchild or brother & sister
 The one is related to the other in the
manor indicated in schedule 1-A

CHAPTER-6
FINDING'S CONCLUSIONS AND SUGGESSIONS
SPECIFIC FINDINGS:
 It is find that savings deposits is increasing from year to year

 From this analysis we know that there is a increase in the No. of

persons deposited in this Bank under savings Bank A/c is in
increasing trend.
 There is a constant interest rate for the savings deposit holder i.e.
3.5%
 From this Analysis we know that there is increase in total interest
amount paid by Bank.
 It is find that current deposits is increasing from year to year.
 By Analysis we know that their is a increase in the No. of persons
deposited in the current A/c is in increasing trend.
 It is find that recurring deposits is increasing from year to year.
 By Analysis we know that there is a increase in the No. of persons
deposited in the recurring deposit A/c . But it is countable in
nature.
 There is a constant interest rate for the recurring deposit A/c
holder i.e. 3.5%
 From this Analysis we know that % of interest amount paid by
bank to recurring deposit holder is less.
 It is find that fixed deposits is increasing from year to year
 From this analysis we know that there is a increase in the No. of
persons deposited in fixed deposit A/c is in increasing trend.
 From this analysis we know that there is no interest for the
depositor who are willing to deposit there amount for the very
short period i.e. 1 to 4 days

 There is a increase in deposits & interest amount paid by bank

under different terms of deposits. [I.e. 1-14 days – Nil, 15-45 4
25% , 46 to 179 days 5%, 180 to 1 year 5.5.%, 1 to 3 year 5.75%,
& 3 years & above 6%]
 There is a increasing in interest rate per annum under different
terms of deposits in fixed deposit
 It is find that this bank has opened a new scheme i.e. Vijaya cash
certificate to the benefit of children higher education & to build a
house
 It is find the deposits in Vijaya cash certification is in increasing
from year to year
 From this Analysis we know that the No. Of persons deposited in
Vijaya cash certificate is easy to count.
 From this Analysis we can know that there is different interest
rate paid by bank to Vijaya cash certificate holder i.e. under the
various terms of deposits [E.g. If they deposit their amount in
Vijaya cash certificate for 1 to 3 year i.e. 6%]
 There is increase in interest amount paid by bank to Vijaya cash
certificate holders
 By Analysis we know that there is a scheme for the Non-
residential Indian’s it is helpful to the Indians who are living in
foreign country.
 There is a scheme for the senior citizens to deposit their savings.
The rate of interest paid by the bank is 7.5%

 We know that V star deposit scheme is beneficial to limited

depositor.
 From this Analysis we know that this bank introduced new
scheme i.e. Vijayashri units to increase the deposits
 From this Analysis we know that Vijaya Bank introduced a New
scheme i.e Jeewan nidhi scheme. It is beneficial to children, salary
people business men, shop keeper house wife etc.,
 From this Analysis we can know that, Vijaya bank introduced a
new scheme i.e capital gains accounts scheme it is very beneficial
to the depositors. By this they get a benefit of exemption from the
income tax.
 There is no interest amount paid by bank to current account
holders but they charge some amount for marinating accounts.
 They give loans for the depositors of current A/c holder i.e
overdraft facility with some % of interest charged by the bank
 They give loan facility for the fixed deposit holder up to the 80%.
 There is a scheme for the salary people who withdraw the amount
before the salary due date.
GENERAL FINDINGS:
 The branch is fully computerized so the work is fast and quick

 There is a good relationship between customer and bank also

there is a good co-operation between manager and staff
 There is a good environment and well arrangement of furniture
and tables
 Good locker facilities are available to the customers in order to
provide good service
 The formalities and procedures for sanctioning loan are simple
and quick.
 Majority of the deposits accepted form the public or invested in
providing loans under housing scheme.
 The deposits accepted well utilized and invested in providing loans
to public under various schemes.
 The bank is also resulted in controlling illiteracy and helps in the
development economy as whole
 The Branch is not offering ATM service to public
 The rate of interest paid on deposits is low
 The eligibility of for granting of housing loan under the Housing
Loan scheme must be related to certain extent.
 This Branch is not giving gold loans and other loans to public
 The loan sanction for the education purpose under the education
loans scheme has been increased from the year to year to prompt
literacy in the economy
SPECIFIC SUGGESTIONS:

 In the present competitive world in the Banking sector the

deposits maintained by Vijaya Bank under savings Bank A/c is in
increasing trend. This is a good sign to the Bank, so let the Vijaya
Bank maintain the same.
 Even though there is increase in No, of customers deposited in
savings Bank A/c the bank has to further struggle to attract more
depositors through attractive interest rate & facilities.
 Vijaya Bank giving constant interest for savings depositors they
have to give flexible interest rate to attract the customer to deposit
their savings.
 The total amount paid by the Vijaya bank is a increasing trend. It
should try to reduce the total interest paid. At the same time it
should maintain the increasing trend of the depositors also.
 In the present competitive world in the banking sector the
depositors maintained by Vijaya bank under current A/c is in
increasing trend, which is a good sign to the Bank, So let the
Vijaya bank maintain the same.
 Depositors under the current account are very low. So the bank
has to increase the depositors under this scheme by giving
attractive offers.
 In order to increase depositors under current Account, the bank
has to provide little bit of interest to customers based on the slabs
of amount deposited by them
 The overdraft facilities provided under current A/c is limited they
have to increase the over draft facilities to attract depositors

 Depositors under the recurring deposit account are very low. So

the bank has to increase the depositors under this scheme by
giving attractive offers.
 The rate of interest paid under recurring deposit account &
savings Bank A/c is same. The bank has to change this rate of
interest to attract more depositors.
 The No. Of persons deposited in recurring deposit A/c is very
short it is countable easily they have to increase this by giving
more interest rates.
 The total interest amount paid by the Vijaya Bank is in the
increasing trend. It should try to reduce the total interest paid. At
the same time it should maintain the increasing trend of the
depositors also.
 Deposits of the fixed deposit A/c is increasing every year although
they have to improve
 Interest rate for term of depositor is increased by bank. By this
they can attract more deposits.
 In the fixed deposit there is no interest rate for the deposit for the
period from 1-14 days so to improve the deposits they have to give
little interest rate to them, so that they can improve depositors.
 Vijaya Bank introduced new scheme i.e. Vijaya cash certificate,
which is useful to the public. So the bank has to introduce such
type of new scheme to help the society as well as to attract more
depositors.

 The No. Of persons deposited in Vijaya cash certificate is very

short it is countable easily they have to increase this by giving
more offers.
 Vijaya Bank opened scheme for NRI s but it is limited they have to
improve it by giving more interest, then other various schemes.
 The interest rate paid for senior citizens is more but the age give
to recognize as a senior citizen is 60 years. The bank has to reduce
this age limit at least 50 years to attract more customers.
 The loans provided for V star depositors based on the minimum
balance of Rs5000/- since from 6 months. The bank has to relax
this eligibility to provide benefits to other people also.
 Capital gain scheme provided by Vijaya bank helps to reduce the
tax burden. So let the bank maintain the same to attract more
depositors who are having the interest of tax planning.
 The loans provided up to 80% of the principle amount deposited
in fixed deposit A/c is a good facility which is provided to
depositors let the bank maintain the same along with reducing the
rate of interest on loan given to the depositors.

GENERAL SUGGESTIONS:
 The bank should offer still more facility to the customer in order
to mobilize mobile the savings from them for purpose of further
investment in some other sector to develop the economy
 The bank should try to increase rate of interest payable on deposit
so as to attract the customer
 The bank should provide ATM facilities to customer
 The eligibility criteria and amount of loan sanction must relate to
some extent so that every person can make use of such facility.
 The Bank should balance properly the cash position in such a way
that there should be neither over capitalization and nor under
capitalization
 The Bank should trade off correctly between the accepts and
deposits and sanction of loan.
 Effective efforts should be adopted to collect debt from the public
 It should provide more subsidies to public
 The bank should decrease the rate of interest on the loan sanction
under different scheme so that each one can utilize the
opportunity of develop further.
 Even while sanction the loan bank has to keep in the mind the
benefit of removing regional imbalance to develop economy as a
whole. So it should consider the remote area should make use such
loans scheme.

 The bank should provide loan to Gold and other Loans to increase
the income of the bank.
 It has to provide few more loan to encourage educated
unemployed youths to develop self-employment among then and
should help them to involve in economic development of a country.
 It should adopt loan scheme in such a way that the poverty should
be removed. For these purpose lower sections of the society must
be kept in mind.

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A study on the deposit schemes at Vijaya Bank Vijaya Bank

The study of potentiality of different securities as a source of

The dimension of Business financial that was Earlier limited to period

Sri Adhichunchanagiri College of Business Management 1

Finance is regarded as lifeblood of an Enterprise. This is because in

Definitions: According to Bonneville & Dewey = “Financing consists in the

Function of Business Finance:

Finance function can be classified into two types

Sri Adhichunchanagiri College of Business Management 2

 Recurring finance function

1. Recurring function: Recurring finance functions Encompassed all

 Planning for funds

2. Non-recurring functions: It refers to the use of functional activities that a

Sri Adhichunchanagiri College of Business Management 3

The financial sector plays a major role in the Mobilization &

Induction of information technology & communications Networking

Origin of the word “bank”: - Opinion is not uniform with regard to

Sri Adhichunchanagiri College of Business Management 4

Bank: A bank is an institution, which deals with money. It means that a

Professor Kinley defines a bank as an establishment, which makes to

Sri Adhichunchanagiri College of Business Management 5

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Functions of commercial bank are:

2. Industrial banks or investment banks:

Sri Adhichunchanagiri College of Business Management 7

Agricultural Banks are in our country based on co-operation system

1. Purchasing discounting, export & import of bills

Sri Adhichunchanagiri College of Business Management 8

Sri Adhichunchanagiri College of Business Management 9

banks mix or combine the commercial banking & industrial or investment

Functions of Commercial banks: The functions of commercial banks are

1. Receiving Deposits: Deposits constitute the main source of funds for

Sri Adhichunchanagiri College of Business Management 10

2. Lending of funds: Lending of funds constitutes the main business

3. Investment of funds on securities: They invest considerable amount of

Sri Adhichunchanagiri College of Business Management 11

The secondary services of a banker may be divided into two classes:

2. Making the payment on behalf of customers: A banker under takes to

3. Purchase & sale of securities on behalf of customers: As a banker has

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4. Advising customers regarding stock exchange investments: A banker

5. Arranging for Remittance of funds on behalf of customers: A banker

7. Acting as trustee, executor, administrator & Attorney of customer:

8. Serving as correspondents & representatives of customers: A banker

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9. Rendering merchant banking facilities: Big commercial banks have set

 Receiving valuables & securities for safe custody

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Deposit creation is an important function of commercial banks without

Meaning of Deposit: Deposits represents the amount accepts by a bank from

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2. The capacity of a bank to earn profits depends on the volume of

Primary And Derivative Deposits:

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withdrawn at any time. Means cheques can withdraw money. Usually, a

Current Account holders should keep a minimum balance of Rest 500/- to

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2. Fixed Deposit Account: A fixed deposit is one, which is repayable after

3. Saving Deposit: This deposit is intended primarily for small-scale savers.

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A research design is a plan of action to be carried out in