Borrowing Information's Introduction

Before developing a credit relationship with any customer, a banker finds out every posswible details about the borrower.Regarding borrower information, study of six Cs i.e character,capacity,
capital,collateral,conditions and compliance is made.Under C6, credit worthiness of the borrower,
payment capacity, managerial capacity,security, sensitivity of the cash flows to markets situations
and the corporate governance with the compliance of rules and regulations formulated by the government etc. are studied.

In the borrowing process, there are so many methods some of them are as follows:

1. C6 Analysis: It covers character, capacity, capital, collateral, condition and compliance.
2. Credit Agencies: It reflex that in foreign countries there are specialized agencies which collect status reports of businessmen.They collect market report from sources such as market place, private agencies and various newspapers.
3. Status Reports: It consists of credit inquiry loan application,market report, study of account, financial statements,other sources and personal interview etc.

However, while assessing the credibility b of the borrower one must be free from biases or undue influence.Hence, as a lending officer one must evaluate all information independently.
It is always advisable to keep space with people having doubtful character or whose intention is not clear.

World Share Market

Share Market is one of the major challenging markets of the world. It is dynamic and changable everything right from economical to political informations and considers market to be supreme.Shares are tificates which gives ownership rights to the holder in the companies.Share Market plays an important role in bank and financial sectors from the investors to the business houses.Abroadly study on the world share market, also known as the world stock exchange.A stock market indicates a market where the trading of company shares, stocks, and bonds take place on a large scale along with issuing and redemption of the securities.

Investment in Share Markets are possible through Stock Exchanges. Exchanges are organized market places where stocks, bonds and other equivalents are traded between the buyers and sellers in an organized market.There are two channels of market for investment purpose, these are: one is Primary Market and the other is Secondary Market. Primary Market deals with securities that are channelized through the Initial Public Offer. In the Secondary Market, investors trade the securities among themselves for profits.Some major roles of world share markets are:

Raising capital for companies,Facilitating company growth, Mobilizing Savings for Investment,
Redistribution of wealth etc.

Hence we can conclude by saying that world Share Market is expanding and helping the economies to grow through proper channelization of funds. World share market participants range from small individual stock investors to large-scale hedge fund investors.

Customer Relations Group

Bank is solely a service orieted business organization.Service excellence is paramount to satisfy a customer and unless a customer is satisfied, it is almost unthinkable of retaining a customer.Ther are two types of customer: namely walk- in customer and permanent customer.Walk - in customers are those customers who enter the bank just to take a one- time service like draft issuance, fax transfer or encashment of cheques. Permanent customer of a bank must fulfil mainly three conditions viz. there must be visible dealing activities between the customers and banker.

Customers are king in the real business world, the Customer Relations Group works with companies in making the transition to superiority in the delivery of superior service, internally and externally. The Customer Relations Group, is an internationally known and respected in a right manner.

Managers helping them fine-tune their problem solving, service and leadership skills and find their behavior with individually by the help of different way, in this way the bank or organizations will get suceeding in the propper way that's the reality in overral looking.Small companies particularly need to differentiate themselves because they don't have the advertising that larger firms do. One of the best ways to differentiate in your relationships with customers is to focus more on listening than on talking.

Hence bank or organization firstly, find out the customer behaviour and then know the customer group , as well as to build the their relationship.Otherwise There will never be a second opportunity to take care of the customer right the first time.

Financial Ratio Analysis

Ratio is the relationship between two figures.They provide two important facts about the management:the return on investment and the soundness of the company's financial position.

Financial ratios are calculated from one or more pieces of information from a company's financial statements.For example, the "gross margin" is the gross profit from operations divided by the total sales or revenues of a company, expressed in percentage terms.

Financial ratio analysis is well-developed and the actual ratios are well-known, practicing financial analysts often develop their own measures for particular industries and even individual companies.Ratio analysis involves following terms:

Leverage Ratios, Liquidity ratios ,Operational Ratios, Profitability Ratios and Solvency Ratios .

Hence,financial ratio analysis means the calculation and comparison of ratios which are derived from the information in a company's financial statements.For instantance,a gross profit margin for a company of 23% is meaningless by itself. If we know that this company's competitors have profit margins of 10%, we know that it is more profitable than its industry peers which is entirely favourable and suitable.Even though, financial ratio analysis is well-developed and well-known

for practicing purposes in any ways.

Working Capital of Bank

Working capital of bank iws managed from deposits collected from customers and loans from central bank and various other banks. Major sources of working capitalof any commercial bank consist of the deposits colllected from the account holders.

Working capital, also known as net working capital or NWC, is a financial metric which represents operating liquidity available to a business. Along with fixed assets such as plant and equipment, working capital is considered a part of operating capital. It is calculated as current assets minus current liabilities.Working capital is known as mention below:

Working Capital = Current Assets − Current Liabilities

When the banks face short term liquidity crisis, they borrow from the money markets.Banks

arrange credit lines with the various foreign banks and local banks to meet their short term fund

requirements.Positive working capital is required to ensure that a firm is able to continue its operations and that it has sufficient funds to satisfy both maturing short-term debt and upcoming operational expenses. ... Positive working capital means that the company is able to pay off its short-term liabilities. Negative working capital means that a company currently is unable to meet its short-term liabilities with its current assets (cash, accounts receivable, inventory).

Wider economic crises

The Economic Crisis is a major problem in the context of world.Due to crisis, the world has been facing recession, depression,etc. So that, negative GDP growth lasting two or more quarters is called a recession. An especially prolonged recession may be called a depression.

Most of countries are trying to minimise its wider economic crisis, some economists have argued that many recessions have been caused in large part by financial crises. One important example is the Great Depression, which was preceded in many countries by bank runs and stock market crashes. The subprime mortgage crisis and the bursting of other real estate bubbles around the world has led to recession in the U.S. and a number of other countries in late 2008 and 2009.

This is a main issue for developed countries like USA, JAPAN,CHAINA etc.

Leverage is most popular measurement for financial crisis.Leverage, which means borrowing to finance investments, is frequently cited as a contributor to financial crises. When a financial institution (or an individual) only invests its own money, it can, in the very worst case, lose its own money. But when it borrows in order to invest more, it can potentially earn more from its investment, but it can also lose more than all it has. Therefore leverage magnifies the potential returns from investment, but also creates a risk of bankruptcy.

Banking and finance's Glance

Banking and financial sectors are growing very smoothly in the context of world.In the world,verious types of banking and finance are available.By the help of its demand,the world has becomes so narrow for doing banking transactions.so that maney people has got so maneyfacilities and aminities.So they have saved time, money,physical cost etc.of mandkinds.Thosetype of banking and finance have served by going different sectors like city area, remote area,developing and underdeveloped area etc.Banking and finance always go hand in hand.

Banking and finance have been succeeding to control the poverty and economic crisis in theworld.But the government must give the authority to open the such banking and finance. Govt. has to implement certain type In your lifetime, you will use plenty of banking products that were previously not available to the ordinary person. Most of us have credit cards, loans, investments and insurancesof rules and regulations over it.

At a glance of old,In your lifetime, you will use plenty of banking products that were previously not available to the ordinary person. Most of us have credit cards, loans, investments and insurances.Small banks and lenders provide services for people who otherwise would never have access to credit; or even sometimes a bank account.In the world,banking has many sectors like Business Banking,Internet Banking,Private Banking etc.Banking is now a highly competitive industry whereas twenty years ago, you were grateful that your bank manager even gave you the time of day. Since we are now sophisticated financial consumers, aware of our banking options, and likely to demand several products in our lifetimes (not just a bank account and a mortgage), we owe it to ourselves to force our bank managers to justify their existence.

International banking services as covering the ways in which you can make transactions in foreign currencies. This includes international payment mechanisms, foreign currency accounts, travellers’ cheques and import/export advice.Finally, returning to international banking as a plaything for better off customers, you will also occasionally find the term applied to foreign currency transactions as investments.

The golden rule with getting the right banking service is: chase the deals in more than one place. Except for offset accounts where there is a huge benefit in keeping banking products together, you lose nothing by shopping around for your exact needs.

Bank Marketing (strategic) plan

Customer satisfaction is a motto of an any banking sectors.Assessment of the customersperception towards the services and products should be continuously made, and at the same time,the emerging expectations of a customer must also be studied and preparation should be done on an ongoing basis.
Banks ofadvance coutries like USA,UK and Japan introduced marketing concept in banking field.when introducing a new product at the bank you must clarify the reason for the product introduction (e.g., to keep up with a competitor down the street?) and analyze the anticipated success of the product. When entering a specific market area, you must analyze and plan all of the issues associated with branch development: finding a location, recruiting management, clarifying the customer base, introducing a new delivery system.

Banking is sevice industry and it has no tangible products to sell except in the exceptional case. So, oviously more energy and labour is required in its marketing efforts to convice a customer on its financial products.Bank will want to analyze the strength and weakness of the idea. For example, how does it position the bank in the marketplace and among its competitors? Is there a need for the service in the market? Will businesses pay for the extra service or does the bank have to offer it for free to be competitive with other banks? A project that is deemed to be a break-even opportunity may be worth pursuing if it provides strong competitive advantages.

This modern age is competitive times, with banks and nonbanks all going after the same customers. Community banks still have an edge - you're still small and local enough to really know your customers. If you can keep your staff and your marketing programs focused on good customer relationships.So that strategy is to succeed in future with goal.

Remittance

'Remittance' is the process of transferring or receiving fund from one place to another through various mode of payment such as swift, draft, TT,FAX,pay order and money transfer etc.Outward remittance is the process of sending fund to some other branch or bank within or out of the country.Inward remittance is to receive fund from some other branch or bank.Theparties involved in a fund transfer are the remitter, remitter's bank, beneficiary, and beneficiary's bank.
Nowadays, banks and money trasfer are engaged in specialised money transfer business like IME,PRABHU MONEY EXCHANGE,WESTERN UNION MONEY TRANSFER etc. 'India Remit’ will enable IDBI Bank’s customers in UK to directly transfer money onlineto any IDBI Bank in India. With this alliance IDBI Bank can offer a seamless, secure and quick money transfer service to its customers wherein they can directly transfer money from their bank account to the receivers account in India.
Remittance is a wave based transfer system in which a special numeric code is given which is known only to individual transferring the money. The account is not required for Electronic
money transfer.so remittance includess swift or TT, draft, fax, elecronic money transfer.
Hence, remittance is so essencial wave which has made world very narrow.It makes all people
so easy and fast without any objections.

Money Market

'Money market' is a short-teerm credit market and essencial feature is the dealing in assets of relative liquidity suh as treasury bills, bill of exchange,short term government securities etc.It meets short-term requirements of borrower and provides liquidity or cash to the lenders.In the another view,Money market is the global financial market for short-term borrowing and lending. It provides short-term liquidity funding for the global financial system. The money market is where short-term obligations such as Treasury bills, commercial paper and bankers.

The fundamental difference between 'capital market' and 'money market' is : capital market is for dealing in long term fund and money market is for dealing in short term funds.By money market,we must understand that it has no location where borrowers and lenders comes together.Banks and Finance companies have some terms for example eligible assets include auto loans, credit card receivables, residential/commercial mortgage loans, mortgage-backed securities and similar financial assets.

Money market in essence, promote economic growth of country.Central bank often plays through the short-term money market in influencing the cost and demand availability and supply of money.Certain large corporations with strong credit ratings, such as General Electric, issue commercial paper on their own credit. Other large corporations arrange for banks to issue commercial paper on their behalf via commercial paper lines.

Banking Risks

In this ara all bank and finance have faced so many problems or risks .Those type of risk give them challenging way. So they must tacle it within right time.Every business is exposed to various risks, wich are quite unforeseen. Bankers business is mainly confined to dealing in money.Hence,the credit risks associated with it are almost an integral part of its business.

There are many types of risks such as concentration risk,lliquidity risk, exchange rate risk,legal risk,counterparty risk, interest rate risk, operating risk,environment risk,security risk , management risk etc.that a banking business is exposed to in the course of its business.
Recent changes in the economy require many changes in economic goals for developing countries. The World Bank develops short-term and long-term goals for sustainability in countries suffering from economic problems.which bank take higher the concentration,higher
the risk is involved.Similarly, if receipts and cash payments have not been managed properly,
it will be great problem in banks and all export& import business asociated with high exchange
rate risk. In the same way, operational environment, natural disaster, infrastuctre,government policy may harmful for them.

Bank (depository institutions) failures are widely perceived to have greater adverse effects on the economy and thus are considered more important than the failure of other types of business firms.the failure of an individual bank introduces the possibility of systemwide failures or systemic risk. This perception is widespread.It appears to exist in almost every country at almost every point in time regardless of the existing economic or political structure.
Moreover, because banks are closely intertwined financially with each other through lending to and borrowing from each other, holding deposit balances with each other, and the payments clearing system, a failure of any one bank is believed to be more likely to spill over to other banks and to do so more quickly. Thus, the banking system is seen as more susceptible to systemic risk.

Hence, above risks have to manage or adopt by bank experts, auditors, consultantsetc.So that
bank and finance must bring risk management programs.Our bank auditors understand that risk isan inherent part of a business's operations. An effective risk management programwill address an organization's desire to optimize the balance between risk and return; therefore, the objective of a risk management program should not be to eliminate risk.We have developed teams of expert professionals in each functional disciplineof banking/financial services.So that effectiveness, efficiency and potential vision should be bring out in the field of bank and finance.

Bank Frauds

Frauds means " Act of deceiving ilegally'in order to make money or obtain goods."Frauds involves misrepresentation, breach of trust, manipulation of books of accounts, encashment of stolen,Cheques, Drafts, Manager's Cheques and bills of exchange,wrongful handling of securities pledged to bank, embezzlement, theft, misappropriation of funds, cheating,shortages hypothecated stocks, irregularities, conversion of properties etc.Every bank can face this situation in one form or the other in times, so it has to strengthen its internal audit system for an early detection and prevention of the same. So Fraud is any dishonest act and behaviour by which one person gains or intends to gain advantage over another person. Fraud causes loss to the victim directly or indirectly.

Banks face fraud due to many internal weakness of its own.When the internal control system is weak,bank become vulnerable to frauds from the unscruplous staff .Dilution of effiency in mana-gerial staff or their involvement, also become prominent cause for fraud to take place from lower level's staff.Banking Frauds constitute a considerable percentage of white-collar offences being probed by the police. Unlike ordinary thefts and robberies, the amount misappropriated in these crimes runs into lakhs and crores of rupees. Bank fraud is a federal crime in many countries.

Hence, to avoide those sort of frauds, bank has to make preventive measure of it.Fo instants or example there should be proper investigation of borrowers and grant of credit in accordance with the borrower's requirement,frequent excess withdrals must be prevented ,officials mus be transferred at reasonable intervals to prevent creation of vasted interests,as well as operational procedures,unscrupulous parties, and rotation of duties are implemented to prevent it.The most great idea, CENTRAL BANK (NRB) should implement the rules over it.

Capital Adequacy System

Bank's assets are maintain in the form of cash, deposits in the central bank and other fellow banks, investments, bills discounted and loans and advances. Some of assets are liquid, some semi-liquid and so0me remotely- liquid. In the same way, banks undertake various off-balance- sheets transactions such as LC issuance, guarantee issuance which are contingent liabilities. Higher the risk associated with each component of assets and contingent items, higher is the risk associated with it.

The capital requirement is a bank regulation, which sets a framework on how banks and depository institutions must handle their capital. The categorization of assets and capital is highly standardized so that it can be risk weighted (see Risk-weighted asset). Internationally, the Basel Committee on Banking Supervision housed at the Bank for International Settlements influence each country's banking capital requirements.
The main purpose of measuring capital adequacy is to give protection to the depositors and creditors by maintaining a higher balance of risk free assets and by increasing their capital base. Banks having adequate capital enjoys more public confidence and share value of such banks are higher in the share market. Each national regulator normally has a very slightly different way of calculating bank capital, designed to meet the common requirements within their individual national legal framework.Most developed countries implement Basel I and II, stipulate lending limits as a multiple of a banks capital eroded by the yearly inflation rate. Banks are instructed to maintain capital adequacy ratio at 6% of core capital and 12% in total fund. However, this will be changed to 8% of total capital fund after the implementation of basle-II accord.

Bank

A bank is an organization, the major function of which is to deal in money and credit.The main business of a bank is to pool the scattered idle deposits in public and channel it for productive use.Bank in otherwise, is a custodian of money received from the depositors.Hence,its responsibility towards the general public is pretty different than those who are involved in the other types of trades and services.Modern day banks exhibit the trait more of a department store with a wide range of financial products to offer.
Retail banking is that part of bank’s operations providing services at its branches for small account holders. In short, retail banking is the banking services for individual customers. The term ‘Retail Banking’ encompasses various financial products viz., different types of deposit accounts, housing, consumer, auto and other types of loan accounts, demand facilities, insurance, mutual funds, Credit and Debit Cards, etc.

The business of a modern days bank is not confined in borrowing deposits and lending advances
only performs a host of other financial activities which has immensely contributed to achieve
industrial and commercial progress of every country.
"The banker's business is to take the debts of other people to offer his own in exchange and thereby create money".

Banks could be changing the way in which accounts operate, as high street banks have been put under pressure in the way they issue charges to customers for breaking terms, such as exceeding agreed overdrafts. The ancestors of modern day banks have been attributed to the merchants,the goldsmiths and the money- lenders.That is called as bank's introduction in mention above.