Swot Analysis of Reliance Life Insurance Company
SECTOR OVERVIEW
1
Introduction: Banking sector The Indian Banking industry governed by the Banking Regulation Act of India, 1949, falling into two broad classifications, non-scheduled banks and scheduled banks. Within the commercial banks there are nationalized banks, the State Bank of India and its group banks, regional rural banks and private sector banks (the old/ new domestic and foreign). With the economic growth picking up pace and the investment cycle on the way to recovery, the banking sector has witnessed a transformation in its vital role of intermediating between the demand and supply of funds. The revived credit off take (both from the food and non food segments) and structural reforms have paved the way for a change in the dynamics of the sector itself. Besides gearing up for the compliance with Basel accord, the sector is also looking forward to consolidation and investments on the FDI front. Public sector banks have undergone much restructuring alongside technology implementation. NPAs have been written off against treasury gains in the last few years. Retail lending (especially mortgage financing) has been grabbing a major share of the market in the last 3 years. With better penetration in the semi urban and rural areas the banks garnered a higher proportion of low cost deposits thereby economizing on the cost of funds.
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Apart from streamlining their processes through technology initiatives such as ATMs, telephone banking, online banking and web based products, banks have also resorted to cross selling of financial products such as credit cards, mutual funds and insurance policies to augment their fee based income. RBI's soft interest rate policy has helped increase the liquidity in the market, and banks have been liquidating their gilt portfolios partially to free resources for lending. Credit off take is expected to be reasonably good both on retail and corporate sides. Following the advice of the government banks have increased lending to
1
Introduction: Banking sector The Indian Banking industry governed by the Banking Regulation Act of India, 1949, falling into two broad classifications, non-scheduled banks and scheduled banks. Within the commercial banks there are nationalized banks, the State Bank of India and its group banks, regional rural banks and private sector banks (the old/ new domestic and foreign). With the economic growth picking up pace and the investment cycle on the way to recovery, the banking sector has witnessed a transformation in its vital role of intermediating between the demand and supply of funds. The revived credit off take (both from the food and non food segments) and structural reforms have paved the way for a change in the dynamics of the sector itself. Besides gearing up for the compliance with Basel accord, the sector is also looking forward to consolidation and investments on the FDI front. Public sector banks have undergone much restructuring alongside technology implementation. NPAs have been written off against treasury gains in the last few years. Retail lending (especially mortgage financing) has been grabbing a major share of the market in the last 3 years. With better penetration in the semi urban and rural areas the banks garnered a higher proportion of low cost deposits thereby economizing on the cost of funds.
2
Apart from streamlining their processes through technology initiatives such as ATMs, telephone banking, online banking and web based products, banks have also resorted to cross selling of financial products such as credit cards, mutual funds and insurance policies to augment their fee based income. RBI's soft interest rate policy has helped increase the liquidity in the market, and banks have been liquidating their gilt portfolios partially to free resources for lending. Credit off take is expected to be reasonably good both on retail and corporate sides. Following the advice of the government banks have increased lending to