From : E-Group, STC, Salt Lake, Kolkata This message is intended only for the use of the Addressee and may contain information that is PRIVILEGED and CONFIDENTIAL. If you are not the intended recipient, dissemination of this communication is prohibited. If you have received this communication in error, please erase all copies of the message and its attachments and kindly arrange to notify stcsaltlake@xxxxxxxx immediately. Using Internet Explorer in ATM PC of your branch, please browse http://10.128.74.200 (our Intranet Web-Site). We have provided lots of Reading Materials for you at the site. Happy browsing! Dear Member, Kindly double click on the enclosed attachment to read it. With regards, Anup Sen, Moderator E-Group, STC, Salt Lake, Kolkata email : stcsaltlake@xxxxxxxx We shall be glad to receive your feedbacks through emails regarding the mails being sent to you through this e-group.Title: State Bank of India, Staff Training Centre, Salt Lake, Kolkata. : : stcsaltlake@xxxxxxxx : :
The last decade has
witnessed major changes in the Indian financial sector after implementation of
banking and other financial sector reforms based on the recommendations made by
the Narasimham Committee - I and II. The
banking sector in India underwent several changes in the areas of prudential,
regulatory, disclosure and supervisory norms, liberalisation, deregulation of
interest rates, competition from new generation private sector and foreign
banks. Tracking banks has therefore become a challenging and exciting task. The
recent measures announced by the RBI to liberalize access to foreign financial
markets for Indian corporates will further increase the pressure of
competition. At the same time, there is renewed pressure on banks to attend to
the traditionally neglected sectors of the economy. Given this scenario, it is
useful to track the performance of banks and evaluate them against
professionally acceptable criteria. The financial year 2002-03 marked an
important point in the recent evolution of the banking sector when more banks
reported better working results. The Financial Express
is publishing every year, as a part of their annual exercise, a report on best
banks in India. The report for the year
2003, published recently is different, as services of professionals like Ernst
& Young (E&Y) were used in conducting a comprehensive study of the
performance of private, public sector Indian banks and foreign banks operating
in India. The FE survey has ranked the players within the Indian banking sector
? 27 public sector banks, 21 old private sector banks, 8 new private sector
banks (excludes those banks who received licenses in 2003) and 43 foreign
banks. Of the total 295 commercial
banks in India as at 31st March 2003, the FE survey has covered 99 commercial
banks (94 scheduled commercial banks and 5 non-scheduled commercial banks). 196
Regional Rural Banks have not been included in the survey. Methodology Ø
Banks were categorized into public sector banks (PSB), old private
sector banks (OPSB), new private sector banks (NPSB) and foreign banks (FB). Ø
Financial information for the year ending March 31,,2002 and March
31, 2003, relating to each of the banks falling into the aforesaid categories
was collected from the data available from RBI. To ensure consistency, only the published information was used. Ø
Five different major criteria were identified against which Indian
banks were ranked. These criteria are: (i) Strength and Soundness, (ii) Growth,
(iii) Profitability, (iv) Efficiency/Productivity, and (v) Credit Quality. Ø
Six sub-criteria were selected within each of the aforesaid major
criteria, which would cover the various aspects of the respective criteria. For
example, the first major criterion i.e. Strength and Soundness has been judged
on the basis of six sub-criteria - (a) capital adequacy (b) core capital (c)
credit/deposit ratio (d) borrowings/deposit ratio (e) total assets (f)
net-worth. Ø
Considering the current banking, industrial and over-all economic
scenario, pertinent weights were assigned to each of the major criteria and
sub-criteria. Ø
Banks were ranked, category-wise, within each of the aforesaid sub-criteria.
These sub-criteria ranks were multiplied with sub-criteria weights and the
weighted sub-criteria ranks were carried over to each of the major criteria.
The sub-criteria ranks were then multiplied by the major-criteria weights. The
resultant weighted major-criteria ranks were aggregated to determine the best
banks in each of the four categories. Position of Nationalised Banks The position of nationalised
banks as on 31.3.2003 is indicated in the following table. Nationalised Banks
(Figures in bracket indicate the position in
2002) Toppers in the Five key Parameters Rank in 2003 (in bracket 2002) 1. Strength &
Soundness Canara Bank 1 (10) 2. Growth Standard Chartered Bank 1 (1) 3. Profitability Standard Chartered Bank 1 (1) 4. Efficiency Standard Chartered Bank
1 (1) 5. Credit
Quality Bank
of America 1 (4) Concluding
observations In the first category
of "state-run" or public sector banks, the survey has rated State
Bank of Patiala and Andhra Bank as the top two. In the category of
best "old" private sector banks, the survey has ranked Jammu Kashmir
Bank and Karur Vysya Bank as the best and the second best. In the category of
"new" private sector banks the survey has ranked HDFC Bank at number
one and ICICI Bank at number two. Finally, in the category
of foreign banks, the FE survey has ranked Standard Chartered Bank and Citibank
as the top two. (The opinions
expressed are those of the individual researcher and do not necessarily reflect
those of the Bank or its Associates) Edited by General
Manager, Economic Research Department, State Bank of India, Corporate Centre,
Mumbai. |