Scheduled commercial banks are those banks which are included in the Schedule II of RBI Act, 1934. Scheduled commercial banks carry out the normal business of banking activities such as accepting deposits, giving loans and other banking services.
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Scheduled Commercial Banks can be divided as follows:
Public Sector Banks (PSBs) are banks in which the government has a majority stake that is more than 50%. The shares of public sector banks are listed on stock exchanges.
As of now, India has 27 Public Sector Banks. This number includes SBI, its 5 associates and 19 other nationalized banks. Two other banks, namely IDBI and Bhartiya Mahila Bank are two banks which have been categorized by RBI as “Other Public Sector Banks”.
State Bank of India (SBI) is India’s largest bank by assets. It has around 17,000 branches and around 200 foreign offices. It is the banker to millions of Indians and has over 2 Lakh employees. SBI was formed in the British Era. It is the child of three presidency banks, namely, Bank of Calcutta (which was later renamed as Bank of Bengal), Bank of Bombay and the Bank of Madras. In 1921, these three presidency banks were merged and the entity was called as the Imperial Bank of India. After about 35 years, in 1955, the Imperial Bank of India was nationalized and renamed as the State Bank of India. This makes SBI the oldest Bank in India.
In 1959, SBI had 8 associate banks. Currently, it has 5 associate banks. They are:
In addition to the above, SBI also has 7 non-banking subsidiaries. They are SBI Capital Markets Ltd., SBI Funds Management Pvt. Ltd., SBI Factors & Commercial Services Pvt. Ltd, SBI Cards & Payments Services Pvt. Ltd. (SBICPSL), SBI DFHI Ltd, SBI Life Insurance Company Limited and SBI General Insurance.
Although SBI comes under the definition of a nationalized bank, RBI puts State Bank of India and its 5 associate banks under a separate category ‘SBI & Associates’).
Private sector banks are those whose majority stake is in private hands. Indian has two types of private sector banks:
There are 12 old private sector banks:
Of the above banks, Nainital Bank is a subsidiary of the Bank of Baroda. 98.57% stake in Nainital Bank is held by Bank of Baroda. There were also other old private sector banks which have now merged with other banks. For instance:
In 1993, RBI issued revised guidelines regarding the entry of private sector banks. Therefore, new private sector banks are the ones which were incorporated as per such revised guidelines. Currently, there are 7 new private sector banks:
As of now, there are 45 foreign banks which are operating as branches in India.
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