Chapter 1

CHAPTER - 1
Introduction:-
Indian bank have adequate capital and sufficiently regulated under the
Reserve Bank of India. The economic scenario of India is also much
better then the other countries. The risk assessment studies on
parameters of market, credit, and liquidity also indicate similar stability
and resilience in the India banking sector to survive through the global
recession.The industry off late has adopted innovative models for
banking such as payment and micro finance models of banking. The
financial year 2015-16 saw 10 small finance and 11 payment banks
being rolled by the Central Bank of India will be instrumental to give a
new shape to the Indian banking industry in the long run.
I at Punjab National Bank that the project titled “Training” and

Development in Delhi is based on my original research work and
dedicate efforts. The result in the report are totally based on the
analysis of data that has Indian developing economy offer tremendous
potential for future growth and organizations appreciating these
consumer’ requirements stand to reap considerable return. However,
compared with more developed economics published consumer studies
are few This .research investigates Indian consumer perception of retail
banking with respect to Punjab National Bank using an approach that
takes account of the research context .Qualitative research was
undertaken to define the relevant service attributes. Performance along
these was then investigates through a survey with over 450
respondents. Regression analysis using SPSS revcaled which are the key
drives of customer satisfaction.
Market size:-
The Indian banking industry is constituted by foreign banks,
public and private domestic banks, urban and rural banks,
cooperative and regional banks along with the credit
institutions of cooperatives. Major share up to 80% is held by
the public sector banks. The private and other players have
thus little share left of them. A total of26public sector banks are
functional in India in comparison to the 25 private banks.
Foreign banks are also considerable with a count of 43. Urban
cooperative, 93.550. Banking through mobile phones is also
being encourage and gaining customers swiftly. The credit
share which was less then 10% in 2014 for the Indian banking
sector has been estimated to grow up to 11-13% by the year
2017 (Standard and Poor Report).
Industry Scenario of Indian Banking

Industry:-
The banking sector in India has grown more qualitatively than
quantitatively. It is anticipated to be so for next years as well
but with a decreased pace of growth. The Vision 2020
document by Planning Commission forecasts and draft 10th FYP
had also forecasted similarly. By 2010, scheduled banks’ assets
were calculated to be INR 4,090,00 crores, which is estimated
to be 65%of current GDP.
The system of Indian banking is regulated by the 1949 Banking
Regulation Act of India. The two major categories banks have
been classified into are scheduled and non-scheduled. The
category of scheduled banks includes cooperative and
commercial banks. The commercial banks can also be classified
as nationalized, private , SBI with its group banks, and regional
rural banks. This categorization will be based on the ownership.
The category of private sector banks is coming up as leaders in
the services of the internet and mobile banking and ATM. The
foreign banks are in the offing to get ahead in the Indian
banking industry.
Company History:-
Punjab National Bank has its roots in Lahore when Lala Lajpat
Rai, Babu Kali Prasono Roy , and Sardar Dyal Singh inspired its
foundation in 1894. The Indian companies Act of 1882 in its Act
VI enshrined the bank with a capital amount of 2 Lac.
Withstanding the pressure of partition and financial crisis, the
bank did away with 40% of its deposits by closing one-third of
its offices which where in West Pakistan. Delhi became the new
location for registered office by shifting it from Lahore in June
1947. New partners as Bharat Banks and indo commercial
banks were added by PNB establish a hold in the market of new
India. In 1969. Nationalization by the Gol covered 13 other
banks along with PNB.
The growth story of PNB comprises of merges and takeovers.
The timelines has witnessed seven private banks being
absorbed and the only merger of a nationalized bank, New
Bank, in India. PNB has also funded regional rural banks (RRBs)
with the aim to reinforce credit delivery mechanism in rural
India.in 2003 the nedungadi bank ltd (e-nbl) of kerala was
merged with PNB.the motive was satisfied the capital needs as
per basel II norms.follow-on public offers(FPOs)were also rolled
out in 2005 to bring down the stake held by gol under 6%.
Company Profile and Business Performance:-

PNB has its headquarters in New Delhi. Its offices count around
5,400 making it second biggest nationalized bank network.
Bank provides an array of services to both its categories of
clients, retail and corporate. Its products include credit cards,
insurance, private banking, consumer banking, wealth and
equity management. Simultaneously, it has met its social
responsibilities along with becoming a tech-savvy organization.
Shri Sunil Mehta is currently serving as the MD and CEO of the
bank. The branches’ number near seven thousand, and the
ATMs count around ten thousand. It ranks high in most of the
financial parameters as operating profit, business across globe,
and deposits. Its business has been growing at an annual rate of
5%, and the liabilities of global deposits are on the rise with a
YoY growth of 7%. The saving deposits grow annually by 14%.
The assets for PNB, net advances, grow by around 3% annually.
Retail credit has witnessed a growth of 20%, agricultural credits
by 10%, and MSME advances by 8%. The operating and net
profits have also risen. PNB has one of the highest domestic net
interest margin and a CRA ratio of around 12%. The cost of
deposits has fallen slightly.
Digital Banking:-
The bank has also launched many innovative digital products
and services. An app to spot ATMs and record complaints has
been launched as “PNB ATM Assist.” Other digital solutions as
MobiEase and SleepEase have also been made available for
touch banking and Internet and mobile banking, respectively.
Customers can also get an instant PIN by using GreenPIN app.
SMS banking has been rolled out in ten widely spoken local
languages like Punjabi, Urdu, Kannada, and others. Customers
have been provided the facility to register for mobile banking
with ease across its network of ATMs.
Online facilities for opening PF and RD accounts together with
securing a locker across the country have been made available
at PNB Web site. “Book your LockerAnywhere in India” has
made it easy for customers to locate a vacant locker in any city.
PNB has also made its brand presence on social media with
Twitter and LinkedIn accounts.
Financial Inclusion:-
PNB was among the first movers in rolling out Pradhan Mantri
Jan Dhan Yojana (PMJDY) and mobilizing deposits. More than a
100 lakh Rupay debit cards have been issued by the bank, and
around 135 lakh accounts were opened to mobilize nearly two
thousand crores.
The “Vitiya Jan Chetna Abhiyan” by PNB was an added
attempt to impart financial awareness across the population.
Micro-ATMs were first deployed by PNB to enable financial
operations across backward locations.
Corporate Social Responsibility:-

PNB opened “Sukanya Samriddhi” accounts for women to
deposit safely. Other schemes Vanita financing, Mahila Kaushal
Vikas Yojana, Power Ride and Savings are an effort toward
women empowerment. “Akshaya” branches of PNB are wholly
managed by and cater to women only.
Awards and Recognitions:-

PNB has collected many awards and accolades across domains.
The major ones include “Golden Peacock National Training
Award 2016”, “Best Bank for PMJDY (Large Bank),” “The Brand
Trust Report 2016,” “RBI Rajbhasha Award,” “Agriculture
Leadership Award 2015,” “Most Respected Public Sector Bank,”
and “Banking Excellence Award 2015.” It ranks globally in the
top 200 banks and first in the nationalized Indian banks. It is
also the most trusted brand among banks, as per the Trust
Research Advisory.
Punjab National Bank Direct Competitors:-

There are many banks operating in India which belong to
different categories such as public sector banks, regional rural
banks, foreign banks, private sector banks, and cooperative
banks. Currently, there are 27 public sector banks; out of it 19
are nationalized. There are many foreign banks which are
having its branches in India with huge investments. All these
are the direct competitors of Punjab National Bank.
Environmental Factors:-
The environment in India is changing in the banking industry.
Growth in the service industry is 55%. As there is an increase in
the growth in service sectors, increase in income will increase
lending and savings.
Legal Factors:-
There are two major factors determining the legal aspects of policy.
Banking regulation Act 1949 was enacted. Intervention by RBI will
intervene in smooth sharp movements in the rupee. PNB has branches
in Dubai and Hong Kong outside India. Both countries have different
external environments compared to India.
Comparison of Punjab National Bank and Direct Competitors:-

Ratio analysis with direct competitors in the industry is shown
in Exhibit.
Banking Industry Analysis:-

There are many factors affecting the banking industry in India.
There is a need to do PESTEL analysis of the industry to
understand a better idea about the industry.
Factors Affecting the Industry

• Government interaction in the industry
• Labor law and tax policy
• Environmental law
• Trade restrictions
• Tariffs and political stability
• Regulation of government
• Budget and budget measures
• Foreign direct investment limits.
Economic Factors:-
RBI declares its six-month economic policies which have a high
impact on the banking industry. Economic measures to boost
economic growth will have an influence on the savings,
deposits, and other banking interaction with the customers.
Sociocultural Factors:-
Cultural aspects, health consciousness, population growth rate,
age distribution, career attitudes and emphasis on safety affect
the investment behavior of customers (see Exhibit 13.2).
Hong Kong:-
• High concentration of banks, almost 70 of the 100 best banks
in the world have branches in Hong Kong
• The reason behind this situation is the tall transparency
standards in the market, and institutions are handled
prudently.
• The Global Financial Centers Index (GFCI) by the Z/Yen Group
listed Hong Kong third in September 2015.
• In 2001, china became a member of WTO. From then, the
government policies have been helpful to accommodate
foreign banks to establish in Hong Kong and the Mainland.
Dubai:-
• The scenario in Dubai is different from the rest of the places,
as recently there is a surge of Islamic banking in that region.
Most of the banks are opening Islamic banking divisions or
converted to Islamic banking itself/
• The government of UAE is concentrating on infrastructural
development in UAE, which gives banks to participate in these
projects.
• It has political stability and favorable tax laws, and is also a
peace-loving country.
• So PNB should try to formulate strategies which pertain to
only this country.
UK:-
• PNB has fully owned subsidiary in UK. It has seven branches
across UK.
• Political interference looms over banking sector which marks
a question on the capacity of government, and its policies and
frameworks need to be reviewed.
• Recently, Brexit and other related political activities have a
huge impact on the banking sector.
• Bank strategies are being controlled by the political
regulations inside UK. Economy is also an open economy. It has
investment from all around the world.

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CHAPTER - 1

I at Punjab National Bank that the project titled “Training” and

Industry Scenario of Indian Banking

Company Profile and Business Performance:-

Corporate Social Responsibility:-

Awards and Recognitions:-

Punjab National Bank Direct Competitors:-

Comparison of Punjab National Bank and Direct Competitors:-

Banking Industry Analysis:-

Factors Affecting the Industry

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