82 A COMPARATIVE STUDY OF OPERATIONAL SERVICE OF PUBLIC AND PRIVATE
SECTOR BANKS Dr. Manoj Jain
Asst. Professor, PMB Gujrati Commerce College 1 INTRODUCTION
As we know that India faced very much struggle to get independence and wisdom from foreign British rules. After independence day there was a extreme need to set up a good and effective infrastructure in the nation. Out of all infrastructural facilities and basic needs or requirements banking services was also a part there of Indian banking system was not found at the time of independence in 1949. Two major steps were taken within you with a view of structural reforms in the banking sector in India. First Banking Regulation Act which provided an intensive power RBI over the commercial banks and second step was Nationalization of banking sector specially RBI in a free Enterprises economy, commercial banks operate like any other business entity and gain private profits show at the time of independence it was viewed that the freedom of commercial bank was not in the harmony of the socialistic pattern of the society so they were Nationalized in 1969 to establish the control over this banks.
2 CURRENT SCENARIO OF BANKING SECTOR
We are living in the rapid changing world with new emerging Technologies and radial expansion of interest email etc.
access to global information and knowledge and the community matters worldwide is how much easier than before, in a bit to meet commitments to International institutional like world Bank, WTO country after country is pulling down barriers to foreign trade and investment. The Government of India has also followed suit with the result that quantitative restrictions on the foreign trade are being dismantled speeding on the domestic front there a clear signals of privatization and liberalization as licensing is being Given Up, controls are being dismantled, restrictive laws are being removed and privatization is being used in almost all sectors low GDP growth
and low per capital income are man constraints in the path of development of Indian economy as it is a developing country. Rapid population growth existence of dualism technological backwardness etc are also making holders in the development of nation India.
At the time of independence which it was a close economy with no FDI, no MNS restrictions on currency, movements Kota raj. permit regulation, licence raj.
and socialistic pattern economy Indian banking sector was also working in the close economy scenario.
In the present context and scenario of private sector banks are permitted to do the work in the Indian economic system. As we have seen, that a lot of private sectors banks are performing very well and playing an important role to boost up Indian economy and come to keep on proper track the. Indian economic system private sector banks have introduced various products, Mutual Funds, insurance, share market etc. and they are coming in retail banking with instrument of mobile banking phone banking net banking ATM, credit , debit card RTGS money transfer etc. phone banking i.e. phonepay, Paytm Google pay etc too has become a part of retail banking scheme. The days gone found conventional Bank's used to dictate terms to customers.
3 OVERVIEW OF PUBLIC SECTOR BANKS
Public sector banks are the banks where are the ones in which the government has a major say it 80-90 percent or more.
holding they are divided into two groups i.e. Nationalised banks and SBI and it is subsidiaries or associate banks.
The central government enter the banking business with the Nationalization of the Imperial Bank of India in 1955. A 60% person stock was taken by RBI and the new bank was named as the State Bank of India. The seven other banks
83 become the subsidiaries of the new bank
i.e. SBI when Nationalised on 19-07- 1960. The next major nationalisation of bank took place in 1969 when the GOI under the Prime Minister Indira Gandhi, Nationalised an additional 14 measures banks.
Public sector banks account for bulk of the branches in India (92.38% in 2019) and deposit accounts for 83.69% of the total deposits out of the ten largest bank in India 7 are from public sectors.
Share of the debit card is steady in increasing for both Nationalized Banks &
SBI group and decline for private and foreign Bank's.
The next round of nationalisation took place in April 1980. The government Nationalised 6 Bank's. The total deposits of this Bank's amounted to around 300 crores. This led to a further increase in the number of branches in the markets increases to 91% of the total branch network of the country.
3.1 Private Sector Banks
The post 1990s & witness total investment favour of Indian private sectors. The investment quantum grew from 56 % in the first half of 1990 to 71%
and the second half of 1990. This trend of investment continued over considerable period of time this investment was especially made in sector like financial services transport and social services.
The private sectors banks the Rise of the Indian private sector companies which provide customers need and speedy services this further fuelled competition among some industry players and even in government organisation. This private sector banks represent parts of the Indian's ranking factors that is made of both private and public sector banks. The private sector banks are banks where operator past of start all-equity are held by the private shareholders and not by government.
The private sector banks are split into the two groups by financial regulators and Indian all and new the old private sector banks existed prior to the national licence in 1969 and kept their Independence because they were either too small all specialist to be included and naturalization the new private sector
banks are those that have have gained their banking licence change of liberalisation in the 90’s.
The importance of private sectors in Indian economy has been very commendable in generating employment and thus stimulating poverty.
4 RESULT AND DISCUSSION
The major factors that have come due to the of private banks may be given below:-
1. Increase quality of life.
2. Increase access to essential items.
3. Increase production opportunities.
4. Lower prices of essential items.
5. Increase value of human capital.
6. Improved social life of the middle- class Indian.
7- Decrease the percentage of people living below the poverty line in the India.
4.1 Comparative analysis of public and private sector banks:-
1 Operating profit margins of selected banks:-
The operating profit is a type of profitability ratio known as a margin also.
The information with which to calculate the operating profit margin comes from companies income. (Operating profit margin = operating income/sales revenue)
Table I
Years SBI BOB PNB HDF C
ICIC I 2015-
16
20.3 2
18.6 3
15.9 2
24.8 2
19.3 9 2016-
17
18.6 2
16.0 8
13.2 1
27.3 8
18.1 1 2017-
18
19.3 9
18.1 6
14.8 1
26.0 1
16.2 4 2018-
19
21.4 8
15.2 1
10.2 0
27.1 1
17.3 3 2019.
20
18.3 1
16.2 4
11.3 8
30.8 1
18.2 4 Source: fundamental analysis of selected Public and Private sector banks in India.
4.2 Net Profit Margin (NPM):-
Net profit margin also known as NET margin indicators how much net income company Max with total sales achieved. A higher net margin means that the company is more efficient in converting cells and to actual profit the net sales pass of the equations is gross sales minus
84 all sales deduction such as sale
allownces.
The formula is
Net profit margin = (Net margin/Net sales) 100
Table II
Years SBI BOB PNB HDFC ICICI 2015-
16 14.26 15.08 11.88 18.93 13.36 2016-
17 12.21 12.84 9.92 23.46 14.82 2017-
18 13.28 13.89 11.73 22.48 12.86 2018-
19 17.34 12.92 8.72 24.88 13.28 2019-
20 15.84 13.46 8.62 26.78 12.64 Source: fundamental analysis of selected public and private sectors banks in India 5 SUGGESTIONS FOR IMPROVING THE CUSTOMER SERVICES BY THE BANKS The extension of services to rural parts will enhance the customers best and volume of transaction of the Banks it will facilitate the Banks to reap the benefits of large-scale operations.
The Bank's officials should maintain a good rapport with the customers this will develop a social banking environment.
The banks have to focus more on CRM it will enhance the customer satisfaction and maintain a sustained relationship with the customers and the long run and enhance the customer loyality.
Appropriate promotional strategies have to be initiated by the Banks with a view to motivate the customers to make use of the variety of products offered by the Banks.
At present the new private sector banks have made impact on the business of the old private banks therefore the old private banks must equip the self to face the rising competition from the new private sector bank in India.
Conclusion
Bank being and an important group of financial organisations of the economy of any Nations this is the backbone of economy growth and prosperity primarily the banks perform functions of a technical natural included in the fulfilment of various requirements as per government economic plants and controlling the utilisation of these credits according to planned priorities.
The researcher has applied the different ratios and found a significant operating margin and net margin of different nationalities and private sector banks in India. It has been observed that the banking sectors in India is responded very positively in the field of enhancing the role of market forces regarding measures of income recognition, potentials regulations of accounting etc.
Through the private banks are doing better, at all the banks has to take necessary steps to improve the overall performance of the banking sectors.
REFERENCE
1. Indian Banking and Finance (2007) Paradigm shift.
2. Impact of foreign banks on the Indian economy (2014).
3. Fundamental analysis of selected public and private sector banks in India.
4. India finance and investment guide.
