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Posts Tagged ‘Banking’

Your decision to have a finance career can be a start of something big for you. According to latest employment and business trends, the growth of the world economy plus the increasing number of people retiring in the next decade will create a demand for finance professionals.

Commercial banking means having an opportunity to work in the areas of financial management, accountancy and auditing, securities, commodities and financial services sales. There’s also an opportunity to work in the area of financial and credit analysis since commercial banks are there to provide banking services to individuals as well as small and large businesses and organizations.

People who work in banking and finance are paid well for the work that they do. Four of the fields that many professionals get into include accountancy and tax, Insurance, investment banking and retail banking. Let’s talk about each of these.

For people to work in accountancy and tax, you need to graduate and get your CPA or certified public accountancy license. To learn more about what you will be doing, many have to complete an on the job training with a legitimate accountancy firm.

The training period is about three years and afterwards, you can continue on staying with them, working for another firm or going into private practice.

Insurers just like accountants need to be licensed. This varies from state to state so you have to study and then pass the exam. Once you do so, your career may get you to sell property or casually insurance and life or health insurance.

You should also take further classes in the future because although you have your license already, rules change and you have to be aware of them.

Perhaps the biggest challenge selling insurance is deciding whether to work for an insurance company or doing this on your own. There are advantages and disadvantages doing both. When you are employed, you get a basic salary while those who decide to work for themselves can only make money earning commissions when a sale is made. How well you do is entirely up to you.

Investment banking is different from regular banking because you are there to raise capital for a company by issuing shares or bonds. Later on, you may even work with a team that advises companies regarding mergers and acquisitions.

Also under investment banking is capital markets. Here, the professional is tasked with trading bonds stocks and other financial products to increase the portfolio of the client.

But before you get into that, most entry levels personnel start out doing research first about certain companies and who are their competitors. Their information is then passed on to the account managers who will then advice the client.

Lastly is retail banking which many of us are aware of because these are the people we meet in the bank from the teller to the bank manager when we need to deposit or withdraw cash and apply for a loan.

Unlike accountancy or insurance, you don’t need to get a license to do this kind of work. You just have to be customer oriented with strong interpersonal and communication skills since you will be dealing with people.

Tax and accountancy, insurance, investment banking and retail banking are the four basic types of jobs for anyone that wants to pursue a banking and finance career after graduation from college. Career progression in any of them is excellent and this can only happen with additional training and at times a license.

This can be achieved by part time study so all you have to do now is weigh your options and then go for it.

Since 1991, India has been engaged in banking sector reforms aimed at increasing the profitability and efficiency of the 27 public-sector banks that controlled about 90% of all deposits, assets and credit. There has been radical and perceptible transformation in the operational environment of the banking sector. However, these changes have been induced with a view to develop sound and efficient banking sector in India, at par with international banking standards and practices. The banking sector, which was one of the most protected sector for five decades in the country and more precisely the public sector

banks were slowly exposed to deregulated environment in slow and phased manner. The Information Technology (IT) revolution is entirely changing the way banking business is done and has considerably widened the rage of products and services as well as the demands and expectations of customers. Risk Management, Asset Liability Management, Product and Service Innovation, Securitization, Relationship Banking Environment Management are some of the current buzz words in the banking scene. There have been few important developments in response to change forces necessitating the learning phenomenon for the banks.

Some of the issues in the banking sector are :responding to intense competition, changing customer profile, increasing role of IT, innovation, profit orientation aspects etc. These developments have implications not only for present but also for the future in terms of operational aspects. The qualitative aspects of change include prudential norms like asset classification, provisioning capital adequacy, risk management requirements, transparency, corporate governance, changing regulatory supervisory systems etc.  Banking system remains the focal point in the financial set-up of country and more so in the context of a developing country like India. There is importance attached to the banking system, in view of their financial intermediary role in payment system. The banking sector is dominated by scheduled commercial banks (SCBs). According to a report by ICRA limited, a rating agency, the public sector banks hold over 75 percent of total assets of the banking industry, with the private and foreign banks holding 18.2% and 6.5% respectively. 2006-2007 was marked by surplus liquidity, slowly rising interest rates, good credit growth, good returns, mergers and status quo on reforms.

The banking industry caters to the following broad categories of products/services:

i) Retail Banking

ii) Retail products such as credit cards, debit cards etc.

iii) Portfolio Management: Mutual Funds etc.

iv) Corporate lending and project financing (including loans)

v) Investment banking

vi) Foreign exchange trading

All of these areas have attracted substantial foreign interest in the event of the opening up of the Indian economy.

The bar for what it means to be a successful player in the sector has been raised. Four challenges must be addressed before success can be achieved. First, the market is seeing discontinuous growth driven by new products and services that include opportunities in credit cards, consumer finance and wealth management on the retail side, and in fee-based income and investment banking on the wholesale banking side. These require new skills in sales & marketing, credit and operations. Second, banks will no longer enjoy windfall treasury gains that the decade-long secular decline in interest rates provided. This will expose the weaker banks. Third, with increased interest in India, competition from foreign banks will only intensify. Fourth, given the demographic shifts resulting from changes in age profile and household income, consumers will increasingly demand enhanced institutional capabilities and service levels from banks.

The banking industry has already begun the process of redefining its boundaries, refining its products and services, providing alternate delivery channels and improving the flexibility of such delivery to cater to all the financial intermediation requirements of the customers. The success of the banking industry will lie broadly on how it responds to the following challenges:-

v     Technology up gradation

v     Customer centric

v     Response to competition

v     Transparency/Accountability

v     Skilled workforce

Technology brings in fundamental changes not just in product differentiation and delivery but also influences productivity, efficiency and profitability. Technology enables banks to provide better services to the customers where the branch is not necessarily the delivery point of banking services.

Customers are no longer investors or buyers of financial solutions. As service that requires high level of customer interface, understanding customer requirements and evolving customer-centric business strategies is the prime focus area for banks.

Competition is inevitable as more number of banks aim for their share of the market pie. Most banks eye the corporate sector and the metro and the urban markets for business. Technology is today the differentiating factor. But as more and more banks come under the Core Banking solutions umbrella, with little to distinguish between the products and services offered by various banks, service and cost alone will be the determining factors in ensuring the profitability and success of the bank.

With the introduction of financial reforms, the Indian Banking Industry has been pushed into the open to achieve international standards of prudential accounting norms for classification of assets, income recognition and loss provisioning. The scope for ensuring openness and transparency in bank management has also been ushered in. corporate governance will determine the way the Board of Directors manage their banks. This will mean that the management will be accountable to the Board and the Board to the stakeholders. Banks will have to adopt the best global practices of accounting norms and reporting. More transparent disclosure norms will ensure that banks resort to self-regulation rather than base their working on regulatory requirements.

HR practices and training is engaging the immediate attention of banks these days. HRM strategies include managing change, building up a team of committed human capital and improving team work. Knowledge levels are very important and sufficient training should be afforded to the staff. The existing staff will have to upgrade their skills to keep pace with the sweeping changes that are taking place on the technology front in Indian banks. Only this will help in improving the quality of service to the customers as well as justify the investments made in technology and the salaries paid.

Banks in near future will have to address compensation issues, flexible work schedules, outsourcing and retaining talent. To face the challenge, bank requires enhanced skills, new knowledge and behavioral adjustments of human resources.

 

 

Anshu Chauhan

Lecturar

SIMT

 

By the end of 1991, in the days of globalization the private banks were going at rapid rate. The investment right full in  banking industry on a global scale remained oligopolistics in nature ranging from the global leaders to Public sector undertaking investment  banks and ‘ boutiques ‘ investment banks portfolio for the fund based were earning at higher interest rate as the earlier non-fund based .Private banks improve margins by offering more service as the result of high salaried individual disposable income increased and for the betterment they need professional advice .In case of private sector banks investment at the aggregate level showed at a significant increase in 2006-2007 , the total investment by 21.9% to Rs2,03,387 crore during 2006-07 from Rs1,66,865.

 

Strongest Secret is the additional flow of credit to common public is the reason for increasing rate of inflation. Many programs have been launched to fairly increase the floatation of money but hardly any one has defined how much, the quantity economist considers demand creation is the result of individual income. Did any financial institution or private sector have searched the maximum paying capacity for an individual? If no, than it is the right time to decide .In today’s world of services every step will lead to suitable economic environment and economically poorer population wouldn’t feel unfortunate on their existence in one the most developing nation .Several measures and effects can be considered for right answers that make each Rupee as the values of money …………………

 

To many observers, the recent debate about possible fiscal policy intervention suggests that we are still relying on the approaches to discretionary in post periods of policy activism. The central bank increased statutory liquidity ratio (SLR) by 100 basic points from 24% to 25% effective from November/8/2009. Scheduled commercial banks are currently maintaining SLR investment at 27 % of their net demand time liability as it has been  noticed that increase in SLR will not the impact of liquidity position for banking system and credit to private sectors .

 

Drastic growth to privatization and extension of financial institution for the lending credit to market is a virtue or vice. By the end of March 2010 budget 2010-201 has shown various variation in rupees. Date has shown mobilization of Indian currency by Non Tax Revenue i.e.  11p, non – debt capital receipt i.e. 3p and borrowing and other liabilities is 29p. there are some factors such as service Tax , Union Excise duties , custom & Income Tax totally they make 34p.On the contrary rupees goes to Non –plan assistance ,state share of duties and taxes ,plan assistance to sate and UT, central plan , subsidies and defiance, Interest payment and finally other non- plan expenditure that makes the total of 93p. On ground bases budget look fine ,  it will possible to fulfill the aspiration of a one billion population, Finance ministry faced an economy that was just about gathering pace after a massive pull back that threatened to undo nearly all the goods work of one decade. This mixture of all the possible advices by assuming a growth 8.5% of Gross domestic products in real term, that is net of the inflation. The estimated inflation rate is 4% for the year; The Indian economy has come a long way just a hope .India with the advanced Industrial structure in the world the only laggard in the agriculture sector. Total production of each sectors actually contracted in the year 2009-2010. Budget has substantially raised the allocation for special including the government flags ship Bharat Nirman programs and rural employment schemes – MGNREGA. (The Mahatma Gandhi National Rural Employment Guarantee Act)

 

Year 2010-2011 has made a fair start to getting back on the path of stable growth , while balancing the risk of a continuing global slowdown but without boarded participation , rapid growth cannot be  sustained effortlessly for year and year to come but the major issues is to calculate on that basis we are forecasting our future growth ; on the higher rate of foreign direct investment , better approach to other countries or on the basis of increasing poverty line , increasing unemployment and most off all static value of money.

 

Betterment in economic stage and flourishing future for Indians can be achieved by increasing the value of money with the limited supply of credit to general population.

 

REFRENCES

BUDGET 2010-2011 /YOJANA/ MARCH 2010
INFLATION DYNAMICS IN INDIA  / RESERVE BANK OF INDIA BULLETIN  / APRIL 2010

 

 

Working in banking either conjures up two images, one of tellers sat behind a counter at Barclays telling you how little money you have or the mysterious suited people who have banking jobs behind the scenes. Banking is a very lucrative business sector that offers very high salaries and great bonuses. But with these highly tempting positives come a lot of hard work and many long hours that may conflict with your personal life.

When it comes to deciding where to work within this sector, then there are plenty of business and companies to work for. You can work for commercial banks, building societies, investment banks, broking firms and financial advisors.

Roles within the banking sector also differ wildly and are not always clear cut. Banking can be roughly split into two camps, retail banking and investment banking and these areas can also be found within the same companies and organisation. High street banks will have both corporate and investment banking operations.

Retail banking is the financial services you will find in your high street banks and are offered to small business and individual customers. These services include safe keeping of money, transferring funds between accounts, providing loans, exchanging foreign money, providing advice, mortgages, insurance and stock broking.

Working within retail banks will involve managing staff, advising customers, authorising overdrafts and loans and creating and developing local business links. These roles tend to mix banking, marketing and human resource management.

Investment banking involves providing financial services and advice to commercial, industrial and government organisations.

Your role will deal with aspects of corporate finance, mergers and acquisitions, stock exchanges, arranging loans for corporations and government bodies, financing large projects, negotiating loans and credits and other tasks.

Investment banking employers will include large international banks as well as large UK based clearing banks, medium sized and small boutique investment banks.

The finance and banking sector have been hit hard in recent times and have been getting some negative press. But you can be assured they will be looking for some hard working experienced employees that can help them make it through these tough times.

This article was written on behalf of Martin Ward Anderson who offer recruitment services for banking jobs and banking operations jobs

Money is one of the man’s greatest inventions, an essential tool of civilization, because every society has a money economy based on coins and paper notes. In primitive society there was a barter system which is the direct exchange of goods and services for goods and services. As the extent of specialization increases, the barter system proves very inefficient. The great disadvantage of barter is the fact that it depends upon a “double coincidence of wants”. It means that the seller and the buyer each must want something the other has to offer. Each person is simultaneously a seller and a buyer. A hunter who wants to exchange his skins for corn must find, not merely a person who wants skins, but someone who wants skin and has surplus of corn for disposal. Trading is very expensive in a barter economy. Time and energy, which could be devoted to production, is spent to laborious system of exchange.

Quite early in his history man discovered a much more convenient arrangement. The use of some commodity as a medium of exchange makes exchange triangular and removes the major difficulty of the barter system. If the commodity is generally acceptable in exchange for goods and services, it is money. A producer now exchanges his goods for money and the money can be exchanged for whatever goods and services he requires.

There are 4 general functions of money:

- Money as a medium of exchange.

- Money as a standard of value.

- Money as a store of value.

- Money as a standard of deferred payment.

Money, the medium of exchange, is used in one-half of almost all exchange. Workers exchange labor services for money. People buy and sell goods in exchange for money.

Money can also serve as a standard of value. Society considers it convenient to use a monetary unit to determine relative costs of different goods and services.

Money is a store of value because it can be used to make purchases in future. But money can became worthless because its real purchasing power is eroded by inflation that is why   houses, stamp collections, and interest-bearing bank accounts all serve as store of value and can be exchanged to money.

Finally money can be used as a standard of deferred payment.

We can define commodity money, token money and IOU money. They are 3 kind of money. Commodity money is ordinary goods with industrial uses (gold) and consumption uses (cigarettes), which also serve as medium of exchange. A token money are usual coins and banknotes. Society enforces the use of token money by making it legal tender, usually they must be accepted as a means of payment by law. Private production is illegal. In modern economies, token money is supplemented by I Owe You (IOU) money. IOU money is a medium of exchange based on the debt of a private firm or individual. A bank deposits cheques securities are IOU money.

In the past most societies used different objects as money. Some of these were valuable because they were rare and beautiful, others – because they could be eaten or used. But it was difficult to measure goods value accurately, divide some of them into a wide range of amounts, and use them to make financial plans for the future. For reasons such as these, some societies began to use another kind of money, that is, precious metals. People used gold bullion as money. To keep gold safely they deposited it with goldsmiths, people who worked with gold for jewelry and so on and also had a guarded vault. Two inventions turned goldsmiths to bankers. The first was that people found it a lot easier to give the seller a letter than it was to fetch some gold and then physically hand it over to him. This letter transferred some of the gold they had at the goldsmith’s to the seller. This letter we would now days call a cherub. The second development was that goldsmiths realized they had a great deal of unused gold lying in their vaults doing nothing, and they can land it for some payment over the loan.

The goldsmiths were an early example of a financial intermediary. A financial intermediary is an institution that specialized in brining lenders and borrowers together.  All kind of banks, insurance companies, pension funds and building societies can be called financial intermediaries.

All banks act with each other, make transactions. A clearing system is a set of arrangements in which debts between bank are settled by adding up all the transactions in a given period and paying only the net amounts needed to balance inter – bank accounts.

Technical innovations and increased competition in the face of deregulation are changing the face of World Banking. Banks and other financial institutions are using computer technology now. With traditional services modern banks offer services based on innovations.

Current account and deposit account are traditional services. Current account can be withdrawn without restrictions but it pays a little interest. Deposit account pays higher interests but can be withdrawn only on mentioned in contract time. Regular, monthly bills can be played by the way of a standing order; the bank pays them according to customer’s instructions. Cheques used to pay irregular bills. Credit card – a card which guarantees payments for goods and services purchased by the cardholder, who pays back the bank or finance company at a letter date. Building society or bank can offer you a mortgage, which is a loan for buying property. An arrangement by witch a customer can withdraw more from a bank account than has been deposited called overdraft. Investment advices are usual bank’s services.

Not all banks offer the same services. According to this difference there are several types of banks.

Commercial banks are businesses that trade in money. They receive ant hold deposits, pay money according to customers instructions, lend money, offer investment advise, exchange foreign currencies, and so on. They make a profit from the margin between the interest rates they pay to lenders or depositors and those they charge to borrowers.

Merchant banks in Britain raise funds for industry on the various financial markets, finance international trade, issue and underwrite securities, deal with takeovers ant mergers, and issues governmental bonds. They also generally offer stockbroking and portfolio management services to rich corporate and individual clients. Investment banks in USA are similar, but they act only as intermediaries offering advisory services, and do not offer loans itselves. Investment banks make their profit from the fees and commissions they charge for their services.

Deregulation in the USA and Britain is leading to the creation of “financial supermarkets”: conglomerates combining the services previously offered by banks, stockbrokers, insurance companies, and so on. Such “supermarkets” or universal banks combining deposit and loan banking with share and bond dealing and investment services.

Central bank supervise the banking system; fix the minimum interest rate; issue bank notes; control the money supply; influence exchange rates; and act as lender of last resort.

The Kingdom of Saudi Arabia is one of the most economically sound nations of the Middle Eastern region. It is oil rich and has relatively robust banking system. Its laws have been rather progressive over the past few years. However excessive government interference, Islamic laws and too many amendments may have prevented the banking system form achieving its full potential.

The official religion in Saudi Arabia is Islam and all the citizens within this country are required to prescribe to this faith. Additionally, the latter religion also forms the basis of the legal code within this country thus implying that most of foreign investors may have a difficult time trying to carry out business within such a country. (Library of Congress, 2008)

The banking sector industry is highly stable. This is partly because it is often regulated by the Saudi Arabia Monetary Fund abbreviated as SAMA. Those banks that conform to Islamic law are not expected to pay their respective depositors for holding their money for them because they prohibit interest rates. Additionally, a number of banks benefit from high amounts of oil revenues, consequently, they are in a position to take up a lot of profits. As of the financial year 2006, Saudi Banks boasted of revenue amounting to one hundred and thirty eight billion US dollars. In Saudi Arabia, no bank has ever been passed of as being a failed one. Also, the latter country only has about nine percent worth of non performing loans as of 2007.

Given all the latter facts and figures, one can therefore imagine that Saudi Bank laws are quite favorable for business. However, compared to other developed nations, there are a number of issues that make this sector lag behind. First of all, the country only allowed foreign banks to operate in their nation after 2000. Consequently, the regulatory framework for their operation is not well laid out. The Gulf International Ban, Emirates bank International and National Bank of Kuwait are just some of the few foreign banks within this banking sector.

The latter country passed the Capital market law in 2003 that was designed to eliminate barriers faced by foreign financial institutions. However, many foreign banks are yet to be satisfied by the banking environment. More effective legislation is still needed in this regard.

Besides the latter matter, the Saudi government is yet to look into development of its investment and intermediary banks. This is largely because their laws do not consider any of the latter institutions seriously and this has therefore prevented growth in the latter sector. In other developed nations such as the United States, the investment banking sector has been one of the drivers of the economy. Consequently, if Saudi Arabian laws were to acknowledge this fact, then they would enact laws top boost that sector and thus make the issue more feasible. (Al Hamidy, 2009)

In Saudi Arabia, there is also minimal legislature on the issue of entrepreneur financial sectors and also in the venture capital segment. This means that most local investors tend to look towards their own family and friends for capital; a method that always hinders economic growth. In close relation to this is the fact that the government has yet to develop the insurance industry. Through the Cooperative Insurance Companies Control law, the government has a real monopoly in this industry. Again, such a law has caused Saudi Arabian economic institutions to lag behind certain countries in the developed world. On top of the latter, there is also a need to acknowledge the fact that these laws are rather traditional and they are affecting the perceptions of this country in the eyes of other potential investors.

However, besides having the latter negatives, there are certain developments that have gone on in the banking sector over the past few years; these signify some moves towards the right directions. First of all, SAMA has tried growing some of the following sectors

Mutual funds
Bonds
Stocks
Initial Public offerings
etc

In the year 1997, the latter country opted to open these investments to people from other countries and therefore experienced a time of economic boom. It should be noted that most investments prior to that year were restricted to the Gulf Cooperation Council. This means that now citizens are financially aware and this could have explained why the country reported close to six hundred and fifty billion dollars worth of capitalization there. (Al Sayari, 2008)

Some seven years ago, the country decided to pass the Tadawul law that was designed to make some of these securities more accessible to the country’s citizens and thus encourage them or make more investments in the sector. The latter law was passed in order to facilitate online trading – an aspect that is common among most developed nations. This was also in line with the official trading floor that had been established within the latter country.

Despite the latter developments, there are still a number of flaws that have been reported within this system. First of all the biggest problem facing them is secrecy in which citizens may take part in an IPO but fail to realize the benefits that they had expected. The country’s laws have also failed to recognize some of these trading hurdles that have been going on in the last few years thus disappointing investors and making the latter sector weaker than it actually is. The lack of transparency in this trading has prevented further growth and development there.

In line with the latter matter is the challenge of government interference in their banking sector. In certain circumstances, government intervention can be a welcome issue when done in an open manner and when it involves a series of stakeholders. However, because of the legacy of powerful families (linked to the Dynasty) within this country, it is often common to find that the latter party is given precedence when purchasing securities compared to other ordinary citizens.

Most of the time, this government interference has been kept under check. However, in 2006, the stock market recorded an unexpected decline after positive gains for three years. This served as warning sign to investors that their system was not as safe as expected. (IMF, 2007)

It should be noted that a number of portfolios within the Saudi Arabian banking sector are rather conservative. This is largely because in the past, the latter sector has been resistant to a series if shock. Consequently, most banks feel as though they have the ability to resist these external factors by maintaining conservative product offerings and also by having large cushions of capital. In line with the latter, most banks tend to augment government securities through the utilization of derivative products. The latter methods are not sufficient because there is no incentive for purchasing interbank trades through the process of reviewing pricing. Consequently, one can assert that there are a number of issues that are yet to receive some improvement and they include:

Liquidity
Credit
Interest rates

If the government were to review their repurchasing law through deregulation of pricing offered by the Saudi Arabian Monetary Agency (SAMA) then this would go a long way in improving the performance of this respective system.

The issue of Asset concentration in most Saudi banks needs to be addressed. The country needs to look into the implications and asset concentration more seriously. This can be done through the use of certain mechanisms. First of all, they can work on their level of household indebtednesses which statistics have shown to be increasing. Besides this, the government needs to work on certain price risk that may be associated with Sharia complaint offerings.

This country‘s banking sector is yet to include the private sector in its industry offerings. This is largely because there are very limited banking intermediaries within this country. In fact, it has been shown that twenty nine percent of the private sector has not been claimed by this arena. Consequently, diversification is urgently needed in this sector. Besides the latter matter, these diversification efforts need to be done though the support of institutional  efforts.

It should be noted that the equity market in Saudis Arabia is one of the most stable within the Arabian stock market. However, there is still a need to improve this framework through improvement of the Companies Law that had been passed in 1965. An amendment is urgently needed in this line of work. Also, there is a need to re-examine most of the liquidity arrangements, debt markets and even deficit financial arrangements. (IMF, 2007)

Lastly, the Saudi Arabian Monetary Agency has been solving problems through temporary decisions making mechanisms and this may affect the overall credibility of the sector

There is no doubt that the Saudi Arabian banking sector has undergone numerous changes over the past decade. They have managed to open up their markets to foreign investors. However, the system is still marred with secrecy and government interference. Their systems are still traditional compared to their counterparts in other regions of the work and all these can be fixed through legislative amendments but most importantly a change in attitude.

Al Hamidy, A. (2009): Banking sector issue in Saudi Arabia, Saudi Arabian Monetary Agency Report, B15, 67

Library of Congress (2008): Saudi Arabia; Federal research Division Report, 12, 56

IMF (2007):  Saudi Arabia: Financial System Stability Assessment; IMF Country Report. 6/ 199. 1- 33

Al Sayari, H. (2008): Saudi Arabian Capital Markets and Banking system; Saudi British Forum Report,3, 70

If you are applying for Graduate Schemes or Internships in Banking, Finance or Investment Banking there are several things you will need to know.

Firstly, you will need to plan in advance in order to secure a graduate job in banking or any graduate career in finance.

If you are still a student looking for work experience and still in your first year, many of the major Investment Banks have Spring Internship programs such as Goldman Sachs.

Obviously check each institutions application deadlines, but most banking or finance spring internship application deadlines range from November to February each year.

As a second year student you can apply for banking or finance summer internship programs at most major investment Banks like Citi Group, Barclays Capital, RBS, UBS, JP Morgan, Morgan Stanley, Morgan Stanley, Deutsche Bank, Bank Of America Merrill Lynch, BNP Paribas, Credit Suisse, Goldman Sachs, HSBC, Nomura Holdings, Royal Bank of Canada amongst others.

As a final year student you will need to be ready to apply for Investment Banking Graduate Scheme deadlines starting in September onwards. This also applies to Accounting Graduate Schemes like PWC, Deloitte, Ernest & Young and KPMG to mention a few, as well as some Commercial Banks, Proprietary Trading Houses, Hedge Funds, Private Equity Institutions, Investment Institutions and other major financial institutions.

It is worth getting a list of Investment Banks and other financial institutions in order to make sure you know which of the Banks and Financial Institutions you want to apply to.

If you have missed any of the finance graduate scheme, banking graduate schemes, finance internship or banking internship application deadlines, then don’t worry.

There are still hundreds of other Banks and Financial Institutions that do not have graduate scheme application deadlines.

You can make your own internship by contacting banks and financial institutions and making your own work experience opportunity.

To be successful in these applications and to make your own banking job or finance work experience, you will need to know what you are talking about.

A great site to stay up to date with the latest Banking Graduate Schemes and Finance Graduate Schemes is the news and career research section of the website of banking and finance consultancy company Benedix.

If you are applying for last minute graduate schemes or work experience opportunities and you have missed the application deadlines you will need a perfect banking CV or finance CV and a lot of creativity to influence your way in and create your own opportunity.

Wealth Management is followed by most people interested in growing their wealth in a systematic and disciplined manner. It is an advisory run by banks, mutual funds and other such financial institutions. The individuals within these institutions who manage the combined finances of a number of investors are wealth managers who invest on behalf of the institution into financial securities.

Islamic banking has evolved in a large way since it was started. Though it was unstructured and inefficient in the earlier times, it started to get a secure holding towards the end of the last century in way of commercial banks and investor funds within the followers’ community.

As the times have passed by, there have now emerged numerous investment funds which do follow the Shari’ah rules of investment along with traditional banking practices. They are in fact the same funds just following the additional Shari’ah practices.

Islamic Banking practices allow only those equity funds which adhere to Shari’ah principles. These include funds that invest in companies that are involved in halal businesses (a business which is designated to be lawful under the Islamic law). Also taken into consideration is if the company is following Shari’ah accounting principles.

Another type of wealth management scheme is trading in commodities which are extremely popular in the Middle Eastern countries. These commodity funds generate incomes by trading in halal commodities. Banks following Islamic banking practices trade in these commodities too.

Investments banks are now offering excellent schemes to Muslim investors who do not wish to trade directly in halal commodities or companies. These banks offer other wealth management services in addition to Islamic funds. Along with the traditional local banks offering special Islamic banking services, the international banks, not to be left far behind are also entering the market. These banks help you make informed decisions on managing the wealth based upon your earnings and your goals.

This is especially helpful for a lot of individuals who do not have either the time or the knowledge to invest in the various investment instruments available in the market. In addition to creation of profits for investors, wealth management institutions also reduce the risk an uninformed investor takes in investing his hard earned money.

BANKING SECTOR REFORMS IN INDIA:

*

~ India had an extremely regulated system of banking.

~ This system suffered from various draw backs.

~ To overcome these draw backs, various reforms were undertaken in two phases.

~ As a result, India achieved stability and efficiency in the banking system.

*

~ A highly regulated banking system had various drawbacks like lack of competition, low capital base, ineffeciency and high intermediation costs.

~ Thus, the depositors and borrowers were highly dissatisfied.

~ More over, after the nationalisation of banks in 1969, the pre-dominance of the public sector increased leading financial repression.

~ Also modern technology had no place in the banking system and the quality of service was inadequate.

~ Improper risk management systems and weak prudential standards gave rise to poor asset quality and low profitability.

~ In order to improve the adverse condition of the then existing banking system, various reforms were introduced since 1991.

~ These reforms were carried out in two distinct phase.

*

~ These reforms were carried out on the recommendations of the NARSHIMAM COMMITTEE (1991:Part 1)

~ These reforms can be categorised as:

1)Strengthening Measures.

2)Operational Flexibility Measures.

3)Competitive Efficiency Measures.

4)Legal Environment Measures.

5)Customer Services and Priority Sector Lending Measures.

1)

~ These measures help the bank to strengthen itself to face the fluctuation in the economic environment.

~ These measures comprise the following reforms:-

# Capital adequcy:

~ The ratio of minimum capital to risk assets is called the CAPITAL ADEQUACY RATIO.( CAR)

~ The CAR has been increased to 9%. At present almost 78% banks have a CAR above 10%.

~ This improves the trust and confidence of the banks in the eyes of the depositors.

# Prudential Norms:

~ These norms were initiated by the RBI to bring professionalism in commercial banks.

~ They include asset classification, income recognition and provision for bad debts.

~ These norms ensure the presentation of accurate financial position of banks as per international accounting practices.

#Valuation Norms:

~ These norms were more helpful to nationalised banks.

~ It made it possible for nationalised banks to raise funds through public issues.

# Transparency and Disclosures:

~ These norms ushered in more transparency and disclosure in published account.

2)

~ These norms provided flexibility to banks in their functioning. They include the following measures

# 

~ The CRR ratio was reduced considerably from 15% (1991) to 6% (2010).

~ Similarly the SLR ratio was also reduced from 38.5% to 25%.

~ These reduced ratios enable the bank to release more funds for commercial lending (Loans & Advance)

# 

~ This norm gave banks the freedom to fix their:

^ Prime lending rates (excluding export credit).

^ Variable interest rates on all deposits (except savings deposits)

#

~ Banks are encouraged to set-up their subsidiaries.

~ This helps to diversify activities like mutual funds, venture capital, merchant banking, housing finance etc.

~ This increases the profit margin and consolidates the bank’s position in the financial market.

#

~ Banks were allowed to open new branches and upgrade extension counters.

~ They are also permitted to close down non-viable branches (except in rural area).

3)

~ These measures improve the competitive efficiency of banks.

~ These measures paved way for private sectors and foreign banks to enter the banking business.

~ The government’s share holding in the nationalised banks was considerably brought down to 51%.

4)

~ These measures provided legal assistance to the banking system for quick recovery of dues.

~ The RBI set up Debt Recovery Tribunals to provide a mechanism to recover loans.

~ Also, a High Power Committee was form to suggest appropriate foreclosure laws.

5) 

~ Banks are suggested to provide at least 40% of lending to priority sector.

~ However, priority sectors have been redefined and subsidy has been reduced.

~ Banking Ombudsman Scheme was introduced for quick settlement of customer disputes.

* 

~ These reforms are being carried out on the recommendations of NARSHIMAM COMMITEE II

(yr 1998).

~ The following reforms have been undertaken:

1)These include

- Insurance

- Credit cards – asset management

- Leasing – investment banking

- Infrastructure financing – factoring etc.

2) 

- forward rate agreements – cross currency forward contracts

- interest rate swaps – liquidity adjustment facility

-forward cover to hedge sinflows (FDIs)

3)

~ Electronic fund Transfer.

~ Centralized fund management system.

~ Negotiated dealing system.

~ Structured Financial messaging solution, etc.

~ Real Time Gross Settlement system (RTGS).

4)

~ Introduction of risk based supervision of banks.

~ basel II Norms.

5) 

~ Increase flow of credit to priority sectors.

~ Definition of priority sector widened.

6) 

~ Setting up of Risk Management Committees.

~ Specialised committes monitor various risk like credit risk, operational risks, market risks, etc.

7) 

~ The limit for foreign direct investment in private banks has been increased to 74%.

~ 10% capital on voting rights has been removed.

~ Universal banking refers to the combination of commercial banking and investment banking.

~ It includes a vast range of other financial services beyond commercial banking.

~ They include insurance, leasing, investment advisory etc.

9) 

~ The enactment of securitisation, Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 is an important step in the banking sector.

~ It led to setting up of asset management compains and enhancing of creditor rights.

~ An asset management company is authorised to acquire the NPAs of the banks.

~ In case of NPAs, a secured creditor can serve a notice to the borrower to discharge the liabilities within 60 days, failing which, he is entitled to take over the possession/management of secured assets.

~ Several institutional measures have been initiated to contain the level of NPAs, like:

^ Corporate Debt Restructuring (CDR)

^ Debt Recovery Tribunals (DTRs)

^ Lok Adalats.

10) 

~ RBI has issued guidelines for mergers and amalgamations of private sector banks.

~ These guidelines cover details regarding:

^ Process of merger proposal

^ Determination of swap ratios.

^ Disclosures and norms buying / selling shares by the promoters before / during the process of merger.

11) 

~ The Government of India has issued a managerial autonomy for public sector banks. (Feb 2005)

~ This enables them to compete with private sector banks.

~ Public sector banks are allowed to:

^ Explore new lines of business.

^ Make suitable acquisitions.

^ Close or merge unviable branches.

^ Open branches abroad.

^ Set up subsidiaries.

^ Exit from an existing line of business.

^ Decide human resource issues.

12)

~ In recent years, prevention of money laundering has assured greater importance.

~ In Nov 2004, RBI revised Know Your Customer (KYC) guidelines.

~ Banks have to frame their policies within the network of KYC guideline. They relate to customer acceptance, customer identification, risk management and monitoring transaction.

13)

~ There is increased use of IT in banking.

~ Banks have introduced various facilities like:

^ Online Banking

^ E-Banking

^ Internet Banking

^ Telephone Banking, etc.

14) 

~ These measures improve customer service of commercial banks.

~ They include:

^ Banking Ombudsman.

^ Customer Service Committee of the Board.

^ Credit Card Facilities.

^ Settlement of claims of deceased Depositor.

 

 

A number of banks and financial institutions entered the Indian market in recent years. This sector now requires a lot of technical and administrative staff to further expand their operations. Plenty of jobs are available and the institutions are outdoing the packages they offer in a bid to woo the best candidates to their firm. The banking sector requires people with every kind of skill. They need people who can sell, people who have operational, managerial and IT skills.

The education that you will need for a career in banking will highly depend on which particular career you are planning on pursuing. Some jobs, such as bank tellers or customer service managers only require that you have a high school diploma or a GED. Other jobs, such as loan officers, and investment officers, will require that you become certified within your state to sell special products such as IRA’s and Annuities. Some careers in this field may require that you have a degree in business or another similar type degree as well. The great thing about a career in banking, is that once you start out in this field, many times the bank you work with will help you get the education you need to advance in your career, which can save you a great deal of money and make you an extremely valuable employee.

Over the last year the recession has also affected the living standards of investment bankers with salaries cut by as much as 40% and bonuses all but eliminated. Nevertheless everything has not turned gloomy for students who are seeking investment banking jobs. Aspiring bankers seem to have confidence that current difficulties are like the proverbial passing cloud and in a short while salaries and bonuses are going to return or even exceed the levels they reached a few years ago. Interest in investment banking degree courses remains high and intern positions are keenly sought after.

Sales and Trading is responsible for buying and selling financial products. “Sales” in i-bank means Institutional Sales, whose role is to offer trading ideas to the institutional clients (e.g. mutual funds, pension funds, hedge funds and other fund houses). In many cases the institutional sales will help promote the IPO and new equity/debt issuance arranged by the Corporate Finance arm.

Understanding the mindsets of people is the key to asking the right questions and success to life in general. Knowing why different questions attract different responses from different people is crucial. Don’t leave it to chance or the mood of the interviewer on that day to decide what to think of you. Take control of your own interview and be prepared.

It is impossible to avoid tough questions; though as many financial job interviews are similar there are plenty of things you can bear in mind to avoid any unnecessary heart ache. It’s usually safe to assume the interviewers might adopt a “good cop/bad cop” dynamic even if it isn’t deliberate. By expecting this you can learn to respond to questions in they way the interviewer will expect and show how capable you are of dealing with difficult people.

Financial Planning Consultancy – You may set up a financial planning consultancy of your own or seek employment in an existing one. This work involves helping individuals in planning their finances for their children’s education, or their retirement needs. It requires answering questions and educating clients about risk factors, to help them to invest their money wisely. Being employed in a corporate setting is also an option, with a job profile related to future financial planning. It would require a firm understanding of investments, estate and tax planning.

Investment banking is one of best options for candidates who possess drive, confidence and stamina. It is not meant for the feint of heart, as investment banking requires very a strong personality. Stamina and drive are both important, as financial services industry employee work long hours, particularly when they have to deal with deadlines. Generally, the working hours of an employee in investment banking ranges between 60 to 70 hours. However, during busy times, working hours may extend through the weekend.

Employees working with the research department provide clients with up-to-date reports on certain areas of interest. Analysts in the research department specialize in a specific business sector or area, thereby developing reports that can be safely distributed to clients. Besides having effective analytical abilities, good analysts working with the research department in investment banking need to have effective communicative skills, ability to think clearly and present clear ideas with confidence to the clients.