BANKING INDUSTRY ANALYSIS.docx - BANKING INDUSTRY ANALYSIS...

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BANKING INDUSTRY ANALYSISINDUSTRY SIZE AND GROWTHThe Indian banking system consists of 26 public sector banks, 20 private sector banks, 43 foreignbanks, 56 regional rural banks, 1,589 urban cooperative banks and 93,550 rural cooperativebanks, in addition to cooperative credit institutions. The Indian banking sector’s assets reachedUS$ 1.8 trillion in FY16 from US$ 1.3 trillion in FY10, with 70 per cent of it being accounted bythe public sector.Total lending and deposits increased at a compound annual growth rate (CAGR) of 20.7 per centand 19.7 per cent, respectively, during FY07-16 and are further poised for growth, backed bydemand for housing and personal finance. Total asset size of banking sector assets is expected toincrease to US$ 28.5 trillion by FY25. Deposits have grown at a CAGR of 13.6 per cent duringFY05–16 to an estimated US$ 1.48 trillion in FY16. Deposit growth has been mainly driven bystrong growth in savings amid rising disposable income levels.Indian banks are increasingly focusing on adopting integrated approach to risk management.Banks have already embraced the international banking supervision accord of Basel II.According to RBI, majority of the banks already meet capital requirements of Basel III, whichhas a deadline of March 31, 2019. Most of the banks have put in place the framework for asset-liability match, credit and derivatives risk managementRising incomes are expected to enhance the need for banking services in rural areas andtherefore drive the growth of the sector; programmes like MNREGA have helped in increasingrural income aided by the recent Jan Dhan Yojana. The Reserve Bank of India (RBI) has relaxedits branch licensing policy, thereby allowing banks (which meet certain financial parameters) toset-up new branches in tier-2 to tier-6 centers, without prior approval from RBI. It hasemphasized the need to focus on spreading the reach of banking services to the un-bankedpopulation of India.
MAJOR PLAYERS AND THEIR CONTRIBUTIONS IN BANKING INDUSTRYCompetitionNameLastPriceMarket Cap.

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