Commercial

Banks
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Sum

Structure of Banking System

in India
Scheduled
Banks

Non-Scheduled
Banks
Central Coop.
Banks and primary
credit societies

State Coop.
Banks

Commercial
Banks

Public Sector
Banks
SBI &
Associate
Banks(7)

Commerci
al Banks

Other
Nationalized
Banks(20)

Private Sector
Banks
Old(1
7)

New(8
)

Foreign
Banks(31)

Definition of Commercial
Banks

An institution which accepts deposits,

makes business loans, and offers related
services.

Commercial banks also allow for a variety

of deposit accounts, such as checking,
savings, and time deposit.

These institutions are run to make a profit

and owned by a group of individuals.

Commercial banks offer services to

individuals, they are primarily concerned with
receiving deposits and lending to businesses.

Functions of Commercial
Bank
Primary Functions
Accepting Deposits

Current Deposits;
Saving Deposits;
Fixed deposits;
Recurring Deposits;
Miscellaneous Deposits.

Granting Loans and Advances.

Short-term Loans
Cash Credit;
Overdraft;
Discounting of Bills.

Long-term Loans
Demand Loan;
Term Loan.

Functions of Commercial Bank

Continue
Secondary Functions
Agency Services
Collection and payment of cheques and bills on behalf of
the customer;
Collection of dividends, interest and rent, etc. on behalf of
the customer, if so instructed by them;
Payment of rent, interest, insurance premium, etc. on
behalf of customers, if so instructed;
Acting as agents or correspondents on behalf of
customers for other banks and financial institutions at
home and abroad.

General utility Services

Issuing letters of credit and travelers' cheques;

Underwriting of shares, debentures, etc.;
Safe-keeping of valuables in safe deposit locker;
Supplying trade information and statistical data useful to
customers;
Acting as a referee regarding the financial status of
customers;
Undertaking foreign exchange business.

Commercial Banks at a
glance

State bank of India and its

associates
Sl. No. Name of bank
Year of
incorporation
1

1966

State Bank of Bikaner &

Jaipur
State Bank of Hyderabad

State Bank of India

1955

State Bank of Indore

1960

State Bank of Mysore

1913

State Bank of Patiala

1917

State Bank of Travancore

1945

1941

Nationalized Commercial Banks

Sl. No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

Name of bank
Allahabad Bank
Andhra Bank
Bank of Baroda
Bank of India
Bank of Maharashtra
Canara Bank
Central Bank of India
Corporation Bank
Dena Bank
IDBI Bank Ltd
Indian Bank
Indian Overseas Bank
Oriental Bank of Commerce
Punjab & Sind Bank
Punjab National Bank
Syndicate Bank
UCO Bank
Union Bank of India
United Bank of India
Vijaya Bank

Year of incorporation
1865
1923
1908
1906
1935
1906
1911
1906
1938
1994
1907
1937
1943
1908
1895
1925
1943
1919
1950
1931

Old Private Sector Commercial Banks

Sl. No. Name of bank

Year of incorporation

Catholic Syrian Bank

1920

City Union Bank

1904

Development Credit Bank

1995

Dhanalakshmi Bank

1927

Federal Bank

1931

6
7

ING Vysya Bank

Jammu & Kashmir Bank

1930
1938

8
9
10

Karnataka Bank
Karur Vysya Bank
Lakshmi Vilas Bank

1924
1926
1926

11
12

Lord Krishna Bank

Nainital Bank

1940
1922

13
14

Ratnakar Bank
Sangli Bank

1943
1948

15
16
17

SBI Comm. & Intl. Bank

South Indian Bank
Tamilnad Mercantile Bank

1993
1929
1921

New Private Sector Commercial Banks

Sl. No. Name of bank

Year of
incorporation

Centurion Bank

1994

HDFC Bank

1994

ICICI Bank

1994

IndusInd Bank

1995

Kotak Mahindra Bank

1985

Axis Bank

1994

Yes Bank

2003

Recent Development in Commercial

Banking

Interest rate deregulation

Electronic Clearing Services (ECS)
Electronic Funds Transfer (EFT)
The opening of new clearing houses,
interconnection of clearing houses
through the Indian Financial Network
(INFINET)
The development of a Real-Time Gross
Settlement (RTGS) System
Centralized Funds Management System
(CFMS)

Continue.

E-banking
E-payment
Automated teller machines(ATM)
Negotiated Dealing System (NDS)
The Structured Financial Messaging
System(SFMS).