Sbi project report pdf

They provide a good investment opportunity to investors who do not wish to be completely exposed to equity markets, but is looking for higher returns than those provided by debt funds. A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is then invested in capital market instruments such as shares, debentures and other securities.

The income earned through these investments and the capital appreciation realized is shared by its unit holders in proportion to the number of units owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost. The flow chart below describes broadly the working of a mutual fund.

These schemes do not have a fixed maturity period. Investors can conveniently buy and sell units at Net Asset Value NAV related prices which are declared on a daily basis.

The key feature of open-end schemes is liquidity. The fund is open for subscription only during a specified period at the time of launch of the scheme. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where the units are listed. In order to provide an exit route to the investors, some close-ended funds give an option of selling back the units to the mutual fund through periodic repurchase at NAV related prices.

SEBI Regulations stipulate that at least one of the two exit routes is provided to the investor i. These mutual funds schemes disclose NAV generally on weekly basis. Such schemes may be open-ended or closeended schemes as described earlier.

Such schemes normally invest a major part of their corpus in equities. Such funds have comparatively high risks.

These schemes provide different options to the investors like dividend option, capital appreciation, etc. The investors must indicate the option in the application form. The mutual funds also allow the investors to change the options at a later date.

Growth schemes are good for investors having a long-term outlook seeking appreciation over a period of time. Such schemes generally invest in fixed income securities such as bonds, corporate debentures, Government securities and money market instruments. Such funds are less risky compared to equity schemes. These funds are not affected because of fluctuations in equity markets. However, opportunities of capital appreciation are also limited in such funds. The NAVs of such funds are affected because of change in interest rates in the country.

If the interest rates fall, NAVs of such funds are likely to increase in the short run and vice versa. However, long term investors may not bother about these fluctuations.

Balanced Fund The aim of balanced funds is to provide both growth and regular income as such schemes invest both in equities and fixed income securities in the proportion indicated in their offer documents.

These are appropriate for investors looking for moderate growth. These funds are also affected because of fluctuations in share prices in the stock markets. However, NAVs of such funds are likely to be less volatile compared to pure equity funds.

Money Market or Liquid Fund These funds are also income funds and their aim is to provide easy liquidity, preservation of capital and moderate income. These schemes invest exclusively in safer short-term instruments such as treasury bills, certificates of deposit, commercial paper and inter-bank call money, government securities, etc.

Returns on these schemes fluctuate much less compared to other funds. These funds are appropriate for corporate and individual investors as a means to park their surplus funds for short periods.

Gilt Fund: These funds invest exclusively in government securities. Government securities have no default risk. NAVs of these schemes also fluctuate due to change in interest rates and other economic factors as is the case with income or debt oriented schemes. Necessary disclosures in this regard are made in the offer document of the mutual fund scheme. There are also exchange traded index funds launched by the mutual funds which are traded on the stock exchanges.

While these funds may give higher returns, they are more risky compared to diversified funds. They may also seek advice of an expert. Tax Saving Schemes These schemes offer tax rebates to the investors under specific provisions of the Income Tax Act, as the Government offers tax incentives for investment in specified avenues. Pension schemes launched by the mutual funds also offer tax benefits. These schemes are growth oriented and invest pre-dominantly in equities.

Their growth opportunities and risks associated are like any equity-oriented scheme. Fund of Funds FoF scheme: A scheme that invests primarily in other schemes of the same mutual fund or other mutual funds is known as a FoF scheme. An FoF scheme enables the investors to achieve greater diversification through one scheme. It spreads risks across a greater universe. That is, each time one buys or sells units in the fund, a charge will be payable. This charge is used by the mutual fund for marketing and distribution expenses.

Suppose the NAV per unit is Rs. However, the investors should also consider the performance track record and service standards of the mutual fund which are more important. Efficient funds may give higher returns in spite of loads. A mutual fund because of its large corpus allows even a small investor to take the benefits of its investment strategy. Convenient administration: Investment in mutual fund reduces paper work and helps in avoiding many problems such as bad deliveries, delayed payments and follow up with brokers and companies.

Mutual fund saves time and makes investing easy and convenient. Diversification: Mutual funds invest in number of companies across a broad cross- section of industries and sectors. This diversification reduces the risk because seldom do all stocks decline at the same time and in the same proportion.

You achieve this diversification through a mutual fund with far less money than you can do on your own. Flexibility: Through features such as regular investment plans, regular withdrawal plans and dividend reinvestment plans you can systematically invest or withdraw funds according to your needs and convenience.

Liquidity: In open-end schemes, the investor gets the money back promptly at net asset value related prices from the mutual fund. In closed-end schemes the units can be sold on a stock exchange at the prevailing market price or the investor can avail of the facility of direct repurchase at NAV related prices by the mutual fund. Low costs: Mutual funds are a relatively less expensive way to invest capital markets because the benefits of scale in brokerage, custodial and other fees transaction into lower costs for investors Professional management: Mutual funds provide the services of experienced and skilled professionals, backed by a dedicated investment research team that analyses the performance and prospects of companies and selects suitable investments to achieve the objectives of the scheme.

Return potential: Over a medium to long term mutual funds have the potential to provide a higher return as they invest in a diversified basket of selected securities. Choice of scheme: Mutual funds offer a family of schemes to suit your varying needs over a lifetime. Transparency You get regular information on the value of your investment in addition to disclosure on the specific investments made by your scheme, the proportion invested in each class of assets and the fund managers investment strategy and outlook Well regulated: All mutual funds are registered with SEBI and they function within the provisions of strict regulations designed to protect the interest of investors.

The operations of mutual funds are regularly monitored by SEBI. Though the growth was slow, but it accelerated from the year when non-UTI players entered the industry. In the past decade, Indian mutual fund industry had seen dramatic improvements, both quality wise as well as quantity wise. The private sector entry to the fund family raised the AUM to Rs.

The main reason of its poor growth is that the mutual fund industry in India is new in the country. Large sections of Indian investors are yet to be. Hence, it is the prime responsibility of all mutual fund companies, to market the product correctly abreast of selling.

The mutual fund industry can be broadly put into four phases according to the development of the sector. Each phase is briefly described as under. It was set up by the Reserve Bank of India and functioned under the Regulatory and administrative control of the Reserve Bank of India.

At the end of UTI had Rs. The end of marked Rs. Third Phase - Entry of Private Sector Funds With the entry of private sector funds in , a new era started in the Indian mutual fund industry, giving the Indian investors a wider choice of fund families.

Also, was the year in which the first Mutual Fund Regulations came into being, under which all mutual funds, except UTI were to be registered and governed. The erstwhile Kothari Pioneer now. The number of mutual fund houses went on increasing, with many foreign mutual funds setting up funds in India and also the industry has witnessed several mergers and acquisitions. As at the end of January , there were 33 mutual funds with total assets of Rs. The Unit Trust of India with Rs.

It was bifurcated into two separate entities. The Specified Undertaking of Unit Trust of India, functioning under an administrator and under the rules framed by Government of India and does not come under the purview of the Mutual Fund Regulations. As at the end of September, , there were 29 funds, which manage assets of Rs. Only chanalising these savings in mutual funds sector is required.

There is a big scope for expansion. Soon they will find scope in the growing cities. Prior to Independence, the Imperial Bank was handling the entire business and banking transactions of the Government.

Further, eight banks of the former princely States were brought under the SBI as its subsidiaries in It is a corporate body with an authorised share capital, of Rs. Out of 17 Directors 6 are ex-officio representing different organisations, 4 are elected by the shareholders, 6 are nominated by the Central Government and one is nominated by the RBI.

During , several organisational changes have been carried out in the areas of structure, systems and-strategies of the SBI. Lean and integrated top management now consists of the Chairman, group executives for National Banking Group, Corporate Banking Group, International Banking Group and Associates and Subsidiaries Group and four staff functionaries in charge of financial, credit, human resources and technology management, and inspection and audit.

Three Strategic Business Units SBUs have been set up under the Corporate Banking Group to focus attention on very large corporate customers, lease finance and project finance. Each SBU has been given profit responsibility. A committee approach has been adopted, both at the apex and circle levels for sanctioning large advances.

They have been delegated higher financial powers to ensure faster decision-making of credit disposals. At the circle level, Commercial and Development and Personal Banking Networks have been created under the charge of General Managers to cater to the client-specific banking needs.

To have a strong commercial bank under the control and supervision of the Government. To spread banking facilities in rural, semi-urban and metropolitan areas by opening branches within five years of its establishment.

This policy of branch expansion has since been continued. To help spread banking in rural areas for the purpose of encouraging and mobilising savings among the ruralists and to provide credit to them.

To subscribe to the debentures of State Land Development Banks and to advance loans on their security. To strengthen co-operative societies, help in the establishment of licensed warehouses arid co-operative marketing societies. To provide financial assistance to small, cottage and village industries. To help other banks and strengthen the banking system. To help the RBI in implementing its monetary and credit policies. Gives Loans and Advances: It gives loans and advances against an eligible security including goods, bills of exchange, promissory notes, fully paid shares and debentures or other securities of a civil authority, etc.

Deals in Bills of Exchange: The State Bank draws, accepts, discounts, buys and sells bills of exchange and deals in letters of credit payable in and outside India. As such, it exchanges foreign currencies in Indian rupees and rupees into foreign currencies. Acts as Agent: It acts as the agent of any registered co-operative bank. Business on Commission: The State Bank transacts pecuniary business on commission. Underwrites Issues: It underwrites issues of stocks, shares, debentures and other securities in which it is authorised to invest.

Capital Stock of Banking Company: It can subscribe to, buy, acquire, hold and sell any shares in the capital stock of any banking company. Form Subsidiary: It can form any banking company as its subsidiary or take over any banking company on the direction of the Reserve Bank. Hire Purchase Companies: It is authorised to make loans and advances to firms and companies engaged in the financing of hire-purchase transactions on the security of book debts, etc.

Project Report on the Working or Achievements of State Bank of India: The State Bank of India is the biggest commercial bank in the country with the largest number of branches and offices in India and abroad. Since its nationalisation in , its working reveals that it has made tremendous progress in deposits, advances, rural credit, industrial finance, priority sectors, merchant banking, mutual fund, housing finance, factoring etc. We discuss below its role and importance as the leading commercial bank of the country.

Banking Trends: 1. Paid-up Capital and Reserves: There has been a phenomenal growth in the paid-up capital and reserves of the State Bank over the years. From mere Rs. In absolute terms, they increased from Rs.

The overall amount of advances increased from Rs. Investments: Its investments in Government securities also show considerable growth. In absolute amount, they increased from Rs. Branch Expansion: Since its nationalisation in , the SBI has been successfully carrying on its policy of branch expansion. Its number of offices including foreign offices increased from in to 8, in June Along with branch expansion, the number of employees also increased from 14, to 2,33, over the period.

Other Highlights: Its credit-deposit ratio was 47 per cent in which increased to 62 per cent in Its capital adequacy ratio was In fact, it has been a pace setter for other banks in rural banking.

It has been helping in providing rural finance in the following ways: 1. In fact, it opened branches during the stipulated period. Since then it has kept up the tempo of branch expansion with the result that at the end of June, , it had 4, branches in rural areas which formed about 46 per cent of its total branches in the country.

Remittance Facilities: With the spread of a network of branches in rural areas, the SBI has been providing cheap remittance facilities to State and Central Co-operative Banks, Land Development Banks, farmers and traders.

Help to Co-operative Banks: The SBI has been of great help to co-operative and land development banks engaged in providing rural credit. It grants short term credit to the State and Central Co-operative Banks against Government securities at a concessional rate. It also grants advances to these banks for financing marketing of agricultural produce, distribution of fertilisers, and procurement of food grains. It also gives advances to them for a short-term on the guarantee of the State Government, pending flotation of debentures by them.

Credit to Co-operative Marketing and Processing. Societies: It provides direct credit to co-operative marketing and processing societies for working capital requirements. Similarly, the Bank grants loans to co-operative processing societies engaged in the processing of sugar, jute, cotton, etc. Finance for Irrigation: The Bank has been extending assistance by way of term loans to various minor irrigation projects, command area development schemes, dug-well and tube-well sinking projects, etc.

Besides, under the Special Project Agriculture sponsored by the Rural Electrification Corporation for energisation of pump sets. Banking is a specialized business. Banks have large number of creditors and failure of one bank can lead to the failure of many other banks as the customers lose faith that can…. More specifically, it is the decision of collection and use of funds.

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