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Evaluation and Structure of Commercial Banks in India

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Evaluation and Structure of Commercial Banks in India
EVALUATION AND STRUCTURE OF COMMERCIAL BANKS IN INDIA
Vinod Raina, ACS, Company Secretary Anjani Technolast Limited, Noida

Introduction

In the earlier societies functions of a bank were done by the corresponding institutions dealing with loans and advances. Britishers brought into India the modern concept of banking by the start of Bank of England in 1694. In 1708, the bank of England was given the monopoly for the issue of currency notes by an Act. In nineteenth century various banks started operations, which primarily were receiving money on deposits, lending money, transferring money from one place to another and bill discounting.

History of Banking in India:
Banking in India has a very old origin. It started in the Vedic period where literature shows the giving of loans to others on interest. The interest rates ranged from two to five percent per month. The payment of debt was made pious obligation on the heir of the dead person.

Modern banking in India began with the rise of power of the British. To raise the resources for the attaining the power the East India Company on 2nd June 1806 promoted the Bank of Calcutta. In the mean while two other banks Bank of Bombay and Bank of Madras were started on 15th April 1840 and 1st July, 1843 respectively. In 1862 the right to issue the notes was taken away from the presidency banks. The government also withdrew the nominee directors from these banks. The bank of Bombay collapsed in 1867 and was put under the voluntary liquidation in 1868 and was finally wound up in 1872. The bank was however able to meet the liability of public in full. A new bank called new Bank of Bombay was started in 1867.

On 27th January 1921 all the three presidency banks were merged together to form the Imperial Bank by passing the Imperial Bank of India Act, 1920. The bank did not have the right to issue the notes but had the permission to manage the clearing house and hold Government balances. In 1934, Reserve Bank of India

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    1786 - The General Bank of India (defunct) 1806 - The Bank of C alcutta, changed as The Bank of Bengal in 1809 1840 - The Bank of Bombay 1843 - The Bank of Madras 1861 - Paper C urrency Act 1870 - Bank of Hindustan (defunct) 1921 - The Imperial Bank of India (amalgamation of the three Presidency Banks) 1935 - The Reserve Bank of India, as the central bank 1949 - Transfer of Reserve Bank to the Government Sector 1949 - The Banking C ompanies Act / Banking Regulation Act 1955 - The Imperial Bank of India became the State Bank of India (first nationalisation) 1961 - Insurance cover for deposits 1969 - Nationalisation of 14 major banks 1971 - C redit guarantee corporation 1975 - Regional rural banks 1980 - Nationalisation of seven more banks, with deposits over 200 crore Printer friendly page Send this article to Friends by E-Mail…

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