NEWS & ADVICE : PERSONAL LOAN
Private banks in India score over public sector banks
By Neelima Shankar
Dec 5, 2007
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New Delhi: The private sector banks have made tremendous strides in the last few years. It was in mid 1990's when Indian banking scenario witnessed the entry of some new private sector banks and in the period between 2002 -2007 these banks have grown by leaps and bounds. They have increased their incomes, asset sizes and outperformed their public sector counterparts in many areas.

This growth was accompanied by a rapid branch expansion. The network of private sector bank grew at almost three times of all scheduled commercial banks and more than four times that of public sector banks (refer to the table below). The star performers among these banks were the Centurion Bank of Punjab (CBoP), HDFC Bank, ICICI Bank, and the Axis Bank (formerly UTI Bank). These big four expanded their branch network at a rapid rate of 14-16 percent per annum in terms of compound growth rates.

Another trend in the banking sector during this period was the increase in staff strength by private sector banks, while the public sector banks witnessed a decline in the number of employees. The private sector banks recorded a compounded growth of 24% in their staff strength. The decline in public sector bank staff can be attributed to restructuring and adoption of IT infrastructure.

Private sector recorded a growth ranging from 30% to 68% in terms of capital, reserves and surplus. The deposits increased in the range of 32% to 51%, while the advances showed a growth trend between 39% to 71%. The net profits by private sector banks recorded a compound annual growth of 27% to 36%. The table below shows the progress of private sector banks:

Operations of Private Sector Banks: Progress

Item

2002-03

2003-04

2004-05

2005-06

2006-07

Compound growth (%)

1

2

3

4

5

6

7

No. of branches

 


 


 


 


 

 


Centurion Bank of Punjab

62

63

77

242

279

45.6

HDFC Bank

215

295

446

515

638

31.2

ICICI Bank

392

419

515

569

713

16.1

UTI Bank/Axis Bank

137

185

250

352

501

38.3

All Private Sector Banks

5,592

5,950

6,453

6,813

7,363

7.1

All Public Sector Banks

47,963

48,299

48,970

49,817

51,392

1.7

All Scheduled Commercial Banks

53,768

54,474

55,669

56,893

59,031

2.4

No. of employees

 


 


 


 


 


 


Centurion Bank of Punjab

945

1112

1,374

4,471

14,458

97.8

HDFC Bank

4,791

5673

9,030

14,878

21,477

45.5

ICICI Bank

11,544

13,609

18,029

25,384

33,321

30.3

UTI Bank/Axis Bank

2,338

3,447

4,761

6,553

9,980

43.7

All Private Sector Banks

59,374

81,120

90,530

110,505

139,285

23.8

All Public Sector Banks

757,251

752,627

738,110

744,333

729,172

-0.9

All Scheduled Commercial Banks

828,328

847,945

856,671

876,955

896,307

2.0

Net profits (Rupees billion)

 


 


 


 


 


 


Centurion Bank of Punjab

-0

-1

0

1

1

--

HDFC Bank

4

5

7

9

11

31.0

ICICI Bank

12

16

20

25

31

26.7

UTI Bank/Axis Bank

2

3

3

5

7

36.1

All Private Sector Banks

29

35

35

50

65

22.1

All Public Sector Banks

123

16

154

165

201

13.1

All Scheduled Commercial Banks

170

223

210

246

312

16.4

Deposits (Rupees billion)     

 


Centurion Bank of Punjab

28

30

35

94

149

51.3

HDFC Bank

224

304

434

558

683

32.2

ICICI Bank

482

681

998

1,651

2,305

47.9

UTI Bank/Axis Bank

170

210

317

401

588

36.4

All Private Sector Banks

2069

2,686

3,146

4,285

5,520

27.8

All Public Sector Banks

10,794

12,268

14,365

16,225

19,942

16.6

All Scheduled Commercial Banks

14,045

15,755

18,376

21,647

26,970

17.7

Advances (Rupees billion)     

 


Centurion Bank of Punjab

13

16

22

65

1,122

70.9

HDFC Bank

118

178

256

351

470

41.4

ICICI Bank

533

627

914

1,462

1,959

38.5

UTI Bank/Axis Bank

72

94

156

223

369

50.5

All Private Sector Banks

1,377

1,704

2,213

3,130

4,148

31.7

All Public Sector Banks

5,493

6,327

8,542

11,063

14,401

27.2

All Scheduled Commercial Banks

7,600

8,636

11,508

15,168

19,812

27.1

Note: Centurion Bank of Punjab was formed in October 2005 as a result of the merger of Centurion Bank with Bank of Punjab. Data for Centurion Bank of Punjab for 2005-06 and 2006-07 reflect the data of the combined entity, while that for the prior period pertain only to the Centurion Bank.
Sources: 1. Annual Accounts of Scheduled Commercial Banks, 1979-2004, Reserve Bank of India.
2. A Profile of Banks, 2006-07, Reserve Bank of India.

The mandate is pretty clear, Private Sector Banks have clearly outgrown their public sector counterparts in all these parameters and it looks like that the trend will continue in the near future.


(Comments Posted : 3) Post Your Comments
1. i want information about different types of bank?
2) current senario , past senario, and future senario of bank.
janhvai patel (Posted: Feb 3, 2012)
2. can u provide me latest data of categoty wise Banksing sector Progress
vishal (Posted: Nov 16, 2011)
3. -Indian banking system
- bank sector of India
-growth of indian banking sector
-present time Indian banking system
shyam (Posted: May 23, 2008)
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