vijaya bank

A study on the deposit schemes at Vijaya Bank

Chapter – I

Introduction

In an organization there will be a normal of activities carried on like

production, Marketing, planning, financier etc., among all these faineances

plays a major role, Which made to study on this.

Finance came to studied as a part of Economics before the turn of the

present category formation of large sized undertakings by consolidating the

smaller ones brought before the Managements the problem of financing to

these enterprises.

The study of potentiality of different securities as a source of

procuring funds form out side world & the role & function of institutional

agencies continue to be emphasized during 1921.

The problem of financing ensured a new dimension in the IInd world

war.

In 1940’s financial wizards continued to be concern with the necessity for

choosing sells a financial structure as would be able to with stand stress &

strains of the part war adjustments.

In 1960’s & 70’s period was marked by a very faithful & exciting Era

for a nor of alternative developments. The financial manager started

thinking on such important issues. As aggregate stock prices, business sale

& etc.

Vishnupriya College of Management studies 1


The dimension of Business financial that was Earlier limited to period

but in recent years broadened according today-to-day operations.

Finance is regarded as lifeblood of an Enterprise. This is because in

the modern money oriented of all Economy finance is one of the basic

foundations of all kinds of economic activities. It is the master key. Which

provides accedes to all sources for being employed in manufacturing

activities. It has been rightly said that business needs money to make more

money, however, it also true that money begets more money only when it is

properly managed: there fore efficient management of every business

enterprise is closely linked with efficient management of its finance.

Meaning: Business finance explains the two terms . They are

“Business “ & “ Finance “. In common speaking the word “Business” is

used to denote merchandising the operation of some sort of a shop or store.

Large or small. It is however giving too narrow.

Definitions: According to Bonneville & Dewey = “Financing consists in

the raising providing & managing of all the money or funds of any kind used

in connection with the business.

According to Prather & wert, “Business Finance deals

primarily with raising administrating & distributing funds by

privately owned business units operating in Non – financial fields

of Industry.



Function of Business Finance:

Finance function can be classified into two types

Recurring finance function

Non- Recurring finance function

1. Recurring function: Recurring finance functions Encompassed all

such

Financial activities as are carried out regularly for the efficient

conduct of a firm planning of funds. Placing of funds, allocation of

funds, income & controlling the uses of funds are the contents of

recurring finance function

Planning for funds

Rising of funds

Allocation of funds

Allocation of income

Control of funds

Non-recurring functions: It refers to the use of functional activities that a

functional activities has to prefer very infreavently, preparation of financial

plant at the time of promotion of the company. The Financial readjustment

in time of liquidity crisis, valuation of the firm at the time of merger Success

full handle of such problems requires financial skills & understanding of

principle & techniques of finances recurring to Non – recurring Situation.



Introduction to Banking

The financial sector plays a major role in the Mobilization &

allocation of financial savings. Financial institutions. Instruments &

markets & which constitute the financial resources from the net savers to net

borrowers, the gains to the real sector of the economy. There fore, depend

on how efficiently the financial sector performs this basic function of

intermediation so that the transaction cost is kept minimum. The banks form

the most important segment of the financial sector. Deregulation of the

banking industry through the abolition of the administrated rates for the

deposits & loans gave the banks the freedom in fixing prices for their

products to compete effectively with Non – bank intermediaries, the banks

were permitted to undertake newer activities live investment banking.

Securities trading & insurance business through on selective basis. The

banks were forced to pay maximum attention on to operational efficiency so

that their transactions costs remained at the Minimum.

Induction of information technology & communications Networking

system is set to change the operating environment of banks drastically.

Technology has already enabled some of the banks to introduce innovation

product to their customers in the from of ATM facility, tale banking & home

banking any time & anywhere banking.



Origin of the word “bank”: - Opinion is not uniform with regard to

the origin of the word “bank”. According to some authors, the word “Bank”

is derived from the words “Banc us” or “Banquet” that is a bench. The early

bankers the Jews in Italy transacted their business on benches in the market

place, when a banker failed his “Bench “ was broken into pieces by the

people which indicated the bankruptcy of the individual banker. But this

explanation was turned out on the ground that the Italian money changers as

such were called bankers in the middle ages. Some others say that the word

bank originally derived from the German word “pack; meaning a Joint stock

fund, which was Italians into ban co when, the Germans were masters of a

great part of Italy according to professor Ramachandra Rao “What ever to

the origin in of the word bank, it would trace the history of banking in

Europe from the Middle Ages.

Bank: A bank is an institution, which deals with money. It means that a

bank recives money in the born of deposits from public & lends money to

the development of trade & commerce.

Prof. Hart says that banker is one who in he ordinary course of his

business. Receives money which, He repays by honoring the cheques of

persons from whom or on whose account he receives it.

Professor Kinely defines a bank as an establishment, which makes to

individuals such advance of money, as may be required, and safely made &

to which individuals entrust money, which it is not required by them for use.



The Indian companies Act defines the term bank as “The accepting

for the purpose of lending or investment of deposits of money from the

public repay able on demand or other wise & withdrawal by cheque, draft, &

order or other wise

Classification of bank:-

Commercial bank

Investment or Industrial Bank

Exchange Bank

Co-operative Banks

Land development Banks

Saving Bank

Central Bank

1. Commercial Bank: Commercial banks perform all the business

transactions of a typical bank Commercial banks accept three types of

deposits. The savings Bank deposits, fixed deposits & current deposits.

They accept these deposits, which are repayable on demand or on short

notice. As such, they send or invest only for shoot durations. They provide

funds only short term funds of trade & commerce. The commercial banks

confine their activities to day –to-day functions of trade & industry. Since

the commercial banks are expected to meet immediate requirement of

depositors, they cannot invest creditors & our drafts. The commercial banks



render an important service by providing to its customers a simple means of

exchange

Functions of commercial bank are:

1. Receiving of deposits 2. Lending of funds

3. Investment 4. Creation of Money.

2. Industrial banks or investment banks: Investment Banks are

provides fixed capital or long term loan to industries. As they finance

industries they are called industrical banks. They are also called

investment banks as they invest their funds in subscribing to the

shares & debenture of industries.

The main functions of industrial Banks are :

1. They grant long term loan to industries.

2. They subscribe to the share capital & dentures of

industries.

3. They under write shares & debentures

4. Provide technical assistance

5. Participating in the management by having their

representatives in the board of industry

6. Advice the type of industry to be set up

7. Providing guidance to their customers regard to

purchase & scale of share & debentures

8. Advising the government on matters relating to

industries



3. Agricultural Banks: These are the banks provide finance to

agriculture. As they finance agriculture mainly they are called

agricultural Bank.

Agricultural Banks are in our country based on co-operation

system

They are of 2 types.

1. Agricultural co – operative banks

2. Land development banks.

1. Agricultural co-operative banks land development banks.

The farmer, provides shooter finance to purchase

fertilizers, pesticides, seed & the payment of cages where

as the later provided long term finance to the farmers to

purchase agricultural machinery installing pump set,

improving plants, repayment of old debts, construction of

Irrigation work ele.,

2.Land development banks: LDB's are those banks which

provide finance to the poor people who are having no

land , who are willing to take land's by providing some

finace.



4. Exchange Banks: These are the banks finance mainly the foreign

Exchange business of a country they are called exchange banks

because they finance mainly for the foreign exchange business the

main functions are:

1.Purchasing discounting, export & import of bills

2.Collecting exports Bill of exchange on behalf exporters

3.ccepting Bill of exchange on behalf of Importers

4.Provides necessary trade information to both

5.Provide remittance facility not only to the business men but

also to the tourists

6.They purchase & sell god silver & foreign currency.

5. Savings bank: These are special banks specialize on the Mobile

Station of small savings of middle & low-income groups they are

called savings bank because they are concocted as mobilization of

small savings. In our country the business of selling banks is formed

by commercial banks & post office the principle function are:

Mobilizing small & scattered savings of people promoting the habit of

thrift [loess spending expenses & savings]

Investing major portion of their deposits on government

securities.



6. Central Bank: A central bank is the highest bank & monetary

Institution of a country it operates under the control of state & works

for the promotion of monetary & Economic stability of the country

the main functions are

a. It has monopoly in issuing currency notes

b. Acting as a banker to government

c. Serving as bankers bank & Acting all controller of

credit

d. Acting as custodian of nations gold & foreign

7. Mixed banking: Mixed banking is the system under with the

commercial banks provide shorterm & long-term finance to industrial

concern Here the commercial banks mix or combine the commercial

banking & industrial or investment banking functions.

Commercial Banks: Commercial banks are banks, which accept

deposits from the public & lend them mainly to commerce for short

periods. As they finance mainly commerce, they are called

commercial banks.

Commercial banks are found all over the world & they

dominate the banking system in every country.



Functions of commercial banks: The functions of commercial banks

are numerous they can be broadly divided into two types

1. Primary function

2. Secondary function.

Primary Functions:

The primary function of commercial bank are :

Receiving of deposits

Lending of funds

Investment of funds on securities

Creation of Money

1. Receiving Deposits: Deposits constitute the main source of funds for

Commercial banks. Commercial bank receives deposits form the

public on various accounts. The main types are:

Current Accounts

Savings deposit Account

Fixed deposit account

Recovering deposit account

2. Lending of funds: Lending of funds constitutes the main business

commercial bank. The major portion of the funds of commercial bank

is employed by way of advances. As advances from the chief source

of profit for banks.



Bank lends funds to the public by way of:

Loans

Occur drafts

Cash credit

Discounting of bills

3. Investment of funds on securities: They invest considerable

amount of

their funds in government & industrial securities. In India

commercial banks are required by statute to invest a good portion of

their funds in government & other approved securities.

Creation of Money: Commercial banks not only receive deposits

from the public & lend them to needy. But also create money.

In the process of lending funds they lend many times more than

the cash deposits. They receive from public

Secondary Function:

A part from performing the main fictional of accepting deposits &

granting advances a banker performs a number of subsidiary services banker

will be able to earn the good will of his customer & attract fresh customers.

The secondary services of a banker may be divided into two classes:

Agency services

Miscellaneous services



Agency services:

1. Collection of money on behalf of customers: A Banker

undertakes to collect money on behalf of his customer. He collects

crossed & uncrossed cheques & bank drafts on behalf of the

customers & credits the proceeds to the customers.

1.

2. Making the payment on behalf of customers: A banker under

takes to make payment on behalf on his customers. He pays the

bill of exchange & promissory. Notes on behalf of customers.

3. Purchase & sale of securities on behalf of customers:

As a banker has contact with stockbrokers & as the customer,

generally, not conversant with the procedure for buying & selling

securities in the stock exchange, the banker under takes to buy &

sell securities on behalf of the customers through stock brokers.

4. Advising customers regarding stock exchange investments:

A banker advises his customer regarding investment on stock

exchange securities. When advice sought by the customers

5. Arranging for Remittance of funds on behalf of customers:

A banker arranges for remittance of funds from one place to

another on behalf of their customers by means of bank draft, mail

transfer & telegraphic transfers.



6. Issuing of credit cards; Banks also issue credit cards to their

customers for making purchase & shopping . The credit card facility

Receives the credit card holder from the trouble of carrying cash for

making purchase further, it minimizes the risk of loss of cash. It also

has ATM centers in major cities which provide to his customer 24

hours banking facilities.

7.Acting as trustee, executor, administrator & Attorney of

customer:

Banker acts as a trustee executor, administrator & attorney of

customer

8 Serving as correspondents & representatives of customers:

A banker serves as a correspondent & a representative of his

customers. As a correspondent & a representative of a

customer. The banker prepares income tax returns of the

customer. Corresponds with the income tax authorities on

behalf of the customers.

9. Rendering merchant banking facilities:

Big commercial banks have set up merchant banking division

manned by qualified staff to perform merchant banking facilities to

commercial & industrial houses



2.Missellaneous services:

Services rendered by a banker not only to his customer, But

also to the general public, some of them are :

Receiving valuables & securities for safe custody

Helping foreign trade transaction

Issuing of traveler’s letter of credit, & traveler’s

cheque to the travelers & tourists

Acting as referee regarding financial standing of his

customers

Under writing of shares & debentures

Entrepreneur development programs

Deposit:

Referring to banks, professor ” sayers “have said that bank is a not

only dealer in money but also manufacture of credit money. It is in the

sense of manufacturing that the concept of credit creation is used. The

banks cannot create any money. But they can create money through

deposit creation.

Deposit creation is an important function of commercial banks

without deposits. They cannot lend at all. Deposit creation is by two

types. When the bank receive cash form the customers. Deposits are

created. This deposit may be savings bank deposit or current deposit any

amount deposited in these accounts could be withdrawn by issue of

cheques.If there is no limit for with drawl. Then that deposit is called

current account. If there is any restriction for withdrawal. Then it is



called saving bank account savings deposits may be of several types such

as fixed deposit, recurring deposits etc current deposit are used for

payments that may arise in future. In the case of current deposits the

depositor wants the bank to offer facilities to withdraw in the form of

cheques as many times as possible. In the savings bank account, the

depositor does not expect these facility , but expert compensation in the

form of interest.

The Bank attracts deposits from the people either by means offering

interest or other facilities. Business people want facilities with drawl

more than interest. Non-business people opiate savings account. A

customer may open any type of account. If he opens a current accounts

& if there is substantial money in that account. He may transfer money

from current account to the savings account & vice versa. The bank has

nothing to do with this behaviors of the customer.

Meaning of Deposit : Deposits represents the amounts accepts by a bank

from the deposits. It is the most important intern on the liability side

because

1. They are major portion of the funds received by a bank

2. The capacity of a bank to earn profits depends on the volume of

deposits

3. The efficiency of a bank is judged by its ability to attract deposits.



Primary And Derivative Deposits:

Deposits may be created in two ways. When the customer tenders

cash into the bank, then the deposit account is opened & the amount is

credited to his account. It is called primary deposit. Using this cash the bank

buys various assets in the form of short term bills of exchange securities.

Share & stocks or it may lend in the form of cash credit to the industries.

While buying these assets or lending money to the business people, cash is

not given to them but demand deposit are opened, these deposits are called

secondary deposits or derived deposits. If the banks have to create demand

deposits. Existence of primary deposit is essential. The initiative of creating

such deposits lies with the banking system. The banks may either create of

May not create such deposits. If the banks find that there are sufficient short

term bills of exchange. Then they may show interest in creating these

deposits. The cash received in the form of savings deposits will be used by

the banking system to create derived deposit They are called derived

deposits because they originate from the primary deposits. These derived

deposits also add to money supply.

Types of Accounts, which are Held in Bank

1. Current deposit account: [Current or Running account}

A current account is an account, which is generally opened by

business people for their convenience. Money can be deposited &

withdrawn at any time. Money can be withdrawn by means cheques.

Usually, a banker does not allow any interest on this account. Even then,



people come forward to deposit money on current account because of two

important privileges, which they can enjoy in a current account Namely:

1. Over draft facility

2. Other facilities like collection of cheques. Transfer of

money & rendering agency & general utility services.

That is why current account holder do not mind a banker chagrin

some commission for services rendered & incidental charges for

maintaining the account whether it is in debit or in credit. Even

though a banker does not allow any interest, he charges interest on

overdraft on a day – to – day basis. In bank of Maharashtra US.

United constructions co & others, it was held that when a customer

over-draw the account with or without express consent, it amounts to

a loan & the customer is around to make good the payment with a

reasonable interest.

current Account holders should keep a minimum balance

of Rest 500/- to keep account running. In a mechanized branch, a

minimum balance of Rs 5000 has to be maintained. If this minimum is

not kept, a minimum charge of Rs 11/- per operation will be debited to

the account. The bank sends a statement of account to the customer

every month. As these deposits are repayable on demand. The banker

should keep a large cash reserve. This may be one of the reasons why

a banker does not pay any interest on the current deposit.



2. Fixed Deposit Account: A fixed deposit is one, which is repayable after

the expiry of a predetermined period fixed by the customer himself. The

period varies from 15 days to 3 years. A deposit account can be opened for

a period of more than 3 years & in that case the rate of interest remains the

same level. In England these deposits are not repayable on demand but they

are with draw able subject to a period of notice. Hence, it is popularly

known as “Time Deposit “ or time liabilities. In India also, the banks have

began to call it “term Deposit” Normally the money on a fixed deposit is not

repayable before the expiry of a fixed period.

3. Saving Deposit: This deposit is intended primarily for small-scale

savers. The main object of this account is promotion of thrift. Hence there

is restriction on with drawals in a month. Heavy with drawals are permitted

only against prior notice, generally, the number of with drawals permitted is

50 per half year.

This account can be opened with a minimum of Rs5/= some

banks live state bank of India keeps it as Rs 20/-.

The minimum balance is not maintained, incidental charges will

be levied at the rate of 50 paise per kolio with a minimum of Rs 1 / -

& a maximum of Rs 5/-

It carries an interest rate of 4 % from April 2000 PA Interest is

allowed on minimum monthly balance in steps of Rs. 10/- multiples

there of between the 10th & the last day of each calendar month.

Generally, overdraft facility is not available in the savings Bank

Account, How ever, instant credit facility unto Rs 2500/- only is



available to savings bank customers for their outstation cheques

provided such cheques do not arise out of trade transactions.

The depositor is supplied with a pass book generally no with

drawals are allowed without the presentation of pass book along with

the withdrawn slip. Now –a –days savings account holder are given

cheque facilities & money can be withdrawn by means of cheques

also. Cheques are also collected on this account. The nomination

facility is also available on savings bank account.

4. Recurring Deposit: It is one form of savings deposits depositors save &

deposit regularly every month a fixed installment so that they are assured of

the sizeable amount at a later period. This will enable the depositors to meet

contingent expenses. Banks have found this deposit popular. Many people

would not have saved If these deposits had not been introduced. This deposit

works on the” maximum little drops of water make a big ocean.”

Any person can open this deposit account. He can even have

than one account at a time. This account can be opened in joint name

also.

For deposit of higher installment, the maturity can be

Calculated as multiples of maturity amount for an installment of

Rs5/-



Chapter – 2

Research design

Introduction: -

A research design is a plan of action to be carried out in

connection with a research project. The design may be a logical presentation

of the various steps in the process of research. These steps include The

statement of problem , Objectives of the study, Scope of study sampling,

tools & techniques of data collection, Plan of analysis limitation and chapter

schemes.

According to Claire sleets & others “A Research design is a

arrangement for collection and analysis of data in a manner that aims to

combine relevance to the research purpose with economy in procedure.

The study has been undertaken on "the schemes of Deposits at

VIJAYA BANK " the objective of this study envisages on deposits

management on loan portfolio of the bank. Also an attempt has been make to

identify the techniques and suggest stratagies for arresting the existing

deposits and prevent the re- emergence of fresh deposits at the VIJAYA

BANK.

Title of study:



“A Study on the deposit schemes at Vijaya bank”.

Statement of the problem:

In the present scenario, the banks are playing an important role in the

Economic development of our country as they helps in encouraging the

people to make savings. These savings are attracted & made to deposit in

the banks for further productive investment. For the purpose of this the bank

has introduced many deposit schemes according to the convenience of

people based on the different categories. So, it is felt very much essential to

make a study on these deposit schemes that how it influences on the

development of Economy & what are the conditions & terms that are to be

fulfilled to make the deposits under various schemes.

Objectives of the study:

1. To ascertain the problem faced by bank by Public regarding Deposit

2. To know the different schemes of deposits provided by Vijaya bank.

3. To know the methodology used by bank to Mobilize deposit from

public

4. To suggest ways & means of developing the deposit schemes.

5. To know the interest rate & other facilities provided

by bank to deposit holders

6. To study & know the financial problem of Bank

7. To provide manager with report to help them to Encourage



Customers for depositing.

8. To come out with the findings & suggestions

Scope of the study: In today’s world, banking services plays on important

role in every lives of individuals. The technological advancements in the

banking sector have grown rapidly in the last years. This has led to the birth

of new generation banks & competition. The study basically focuses

towards the observation of the operations & performance of Vijaya Bank

regarding deposits. The study with in its scope has tried to find out the new

trends promoted by the Vijaya Bank regarding deposits.

This study attempts at understanding how Vijaya Bank functions in its

changing scenario & how each department at the head office contributes to

the success.

From the management point of view the study helps them to know

whether they are successful with their operations & as management student

this study helps in getting birds eye view of latest development & upcoming

changes in Banking sector.

Methodology: Personal interview was adopted for collecting data

from Vijaya Bank regarding deposits schemes for collecting primary data

and secondary data is collected through the following

1. Financial Books



2. Annual reports

Tools & the techniques of data: Analysis & interpretation of data in based

on both primary & secondary data.

Primary data: Primary data are the first hand information collected, through

various methods such as observation, interviews.

Secondary data: Secondary data are obtained from text books, magazines,

news paper & Annual reports & Broachers of the bank & official website.

Limitation of study:

Every efforts has been made to make study complete & has

exhautsive as possible, however the study is not free from certain

limitations.

1. Some times respondents dislikes to discuses regarding data collection.

2. Time limit for the study

3. The study is only confined to Vijaya Bank & the performance of

other banking company is not compared with it.

4. The collected information is limited & factual to some extent since

some information is confidencial & Bank opposed to dispose it .

5.The Exhastive study has not been made on Vijaya Bank & is limited

to the partial fullfillment for the degree of B.B.M.

6. Collection of data & study was based purely on observation of the

operation of Vijaya Bank constraint.



Plan of Analysis

The Analysis has been done with the help of scheme of deposits

related to vijaya bank for the past 3 years.



Chapter overview scheme

Chapter-1

Introduction: - It consists brief information about finance, banking and

deposit schemes.

Chapter-2

Research design: - It consists brief information about the design

adopted in preparing the project

Chapter-3

Industry profile: -It consists brief information about the banking

Chapter-4

Company profile: -It consist information about vijaya bank

Chapter-5

Analysis and interpretation: - It consist information about deposit

schemes

Chapter-6

Findings, recommendations and conclusions: - It consist findings,

recommendations for the findings and conclusions

Bibliography: -

Annexure :-



CHAPTER- 3

PROFILE OF THE BANK

Banking has existed ever since man-made money. Money

lending, which is one of the important function of banking is existed even

than. However, the function of the banking is not more about just money

lending it’s about deposits interest rates locker systems etc.

The banking system in our country comprises three constituents

public sector banks, private sector banks & foreign banks, there are 27

public banks, accounting for 81% of the total of all banks.

We have private sector banks, whose role has considerably narrowed

down after two-step nationalization. The number of private banks stood

at 34 as on 31st March, 1999 4172 branches.

Foreign banks in private sector are branches of banks incorporated

outside India. There are 44 such banks with 180 branches on end March

1999.

The Indian commercial banks have played a significant role in the

economic development of the country. Be it branch expansion, deposit

Mobilization credit expansion, Minimizing regional imbalances or

promotion of new entrepreneur ship . The role of commercial banks is

considerable . There are short comings nevertheless. For e.g., The

banking services have not reached all parts of the country, loan recovery



has become a big problem for banks in efficiency & customer complaints

are common in banks & losses have become a way of life. Banks often

find it difficult to strike a balance between their commercial compulsions

& social obligation.

History of Banking:

Bank of Hindustan, setup in 1870, was the earliest Indian Bank,

banking in India on Modern lines started with the establishment of three

presidency banks under presidency banks act in 1876 i.e. banks of

Calcutta, bank of Bombay bank of madras. In 1921, all presidency banks

an alga mated to form the imperial bank of India. Imperial bank of

carried out limited central banking functions also prior to establishment

of RBI. It engaged in all types of commercial banking business except

dealing in foreign exchange.

Reserve Bank of India act was passed in 1934 & Reserve bank of

India was constituted as an apex bank with out major government

ownership. Banking regulation act was passed in 1949. This under

government control, under the act RBI got wide ranging powers for

supervision & control of banks. The act also vested licensing powers &

authority to conduct in- sections in RBI.

In 1955, RBI acquired control of the Imperial Bank of India, which

was renamed as state Bank of India. In 1959 , SBI took our control of

eight private banks floated in the east while princely states, making them

as its 100% subsidiaries.



RBI was empowered in 1960, to force compulsory merger of weak

banks with the strong ones . The total number of banks was thus reduced

from 566 in 1951 to 85 in 1969. In July 1969, government nationalized

government nationalized 6 more banks were to make them play the role

of the catalytic agents for economic growth. The Norseman committee

report suggested wide ranging reforms for the banking sector in 1992 to

introduce internationally accepted banking practices.

The amendment of banking regulation act in 1993 saw the entry of

new private sector banks.

The banking scenario has changed immensely after the economic

liberalization & globalization. There is transformation from traditional

banking to modern multifaceted banking system in line with the need to

achieve rapid socio economic progress . There is a clear change in the

philosophy & techniques especially in the field of lending from whole

role nature to retail character of banking activities.

Today, the banking sector is facing severe computation. In order to

survive in this competitive environment, bank now focuses on creating

& delivering customer needed service in a customer satisfying manner.

Meaning : A banking company has been defined under section 5 (1)

( c) of the banking company regulation act of 1949, “any company

transacts the business of banking in India.

According to sec 5(1) (b) of the same act defines the banking has

“accepting for the purpose of lending or investment of deposits of money



from the public, repayable on demand or other wise & withdrawal by

cheques, drafts orders or other wise.

Role of Commercial Banks in a modern Economy:

Banks play significant role in the economic development of the

country. It can be seen from the following points.

1. Deposit Mobilization: Banks play significant role in

mobilizing the savings of people by initiating different deposit

schemes by extending a network of branches through out the country.

2. Granting of credit: Banks credit is essential for financing

trade, commerce, industry, agriculture & other productive activities.

Banks extend credit to this entire field in order to have economic

development of the country.

3. Creation of credit: Commercial banks can increase or decrease

the money supply in the country & inject elasticity in to the credit

system though their function is creation of money.

4. Channelise funds in to productive Investments : Banks not

only and fund but also ensure that funds are lend only for productive

purpose by monitoring properly.

5. Provision of finance to the Government : Banks provide short

term funds by purchasing trustee bills & long term funds by

subscribing government bonds provide finance to the government.



6. Protecting the funds of depositor : Banks provides safety to

the funds of depositor by lending to different kinds of borrowers

engaged in different activities in different areas, to be invested in

productive projects & they also ensure that advances are properly

secure & will come bank in time

7. Provision of Remittance facility : Banks provide remittance

facility through remittance mechanism of bank drafts, mail transfers,

telegraphic transfers, traveler’s heaves, circular note etc., & help the

businessmen to secure funds when needed.

8. Provision of medium of exchange: Bank deposits, with

draw by cheque of transferable by credit transfers serves as a means of

settlement of debts by this it reduces use of legal tender money.

9. Discharge of social Responsibility: Banks have recognized

their social responsibility very well & now days they serve in the best

interest of the society at large. It is their bounder duly to grant credit

to every section of the society.

10. Innovative services: Modern banks under take a number

of innovative services like, merchant banking, underwriting of

securities, factoring, leasing , housing finance setting up of natural

funds etc., for the Economic development of the country.

Books of Accounts to be maintained by Banking Companies:

A banking company is received to maintain various ledger &

registers as per the requirement of the banking regulation act 1949.



All the books & register’s a banks has to maintain can be classified

into the following categories.

1. Principle ledgers

2. Subsidiary ledgers

3. Other registers & memorandum Books.

1. Principle ledger : A Banking company required maintain

the following principle books :

A. Cash Book: Which provide the summery of collection &

payments of the bank.

B. General ledger : General ledger provides details regarding

assets not covered under subsidiary books & also contain the control

accounts of subsidiary books.

2. Subsidiary ledger:

It Includes;

a. Receiving cash counter cash books

b. Paying cash counter cash books

c. Current accounts ledger

d. Saving bank account ledges

e. Fixed deposit account ledges

f. Investment ledger

g. Cash credit ledger

h. Loan ledger

i. Bills discount & purchased ledger



j. Receiving deposit account ledges

k. Fixed deposit account ledges

l. Customer’s acceptances, endorsement &

guarantee ledger etc.

3. Other registers & memorandum books:

It Includes:

a. Bills for collection register

b. Share security register

c. Jewelry register

d. Demand draft register

e. Safe custody register

f. Standing order register

g. Dishonored check register

h. Letter of credit register

i. Lockers register

Features of Bank Accounting :

Following are some of the feature of Bank accounting :

1. Banking companies have to maintain books of accounts

under double entry system

2. It has to maintain books of accounts as reserved under

the provision of banking regulation act .

3. The posting of transaction in the ledger will be based on

deposit credit slips.

4. Self balancing system of ledger is followed in accounting

by banking companies.



Project Finance Department:

Introduction : Project Finance Department { P F D} is a

professional outfit under the corporate credit wing { CCW} of Vijaya

Bank. The department consists of experienced professionals in the fields

of finance & technical offering various services in the area of corporate

credit, project appraisals, syndication of loan etc to corporate . The

department has successfully executed a variety of assignment in the past

in the area of project financing & other advisory services.

Range of services:

Project advisory services: Review of project feasibility,

structuring of financing plans & advice on financial modeling &

preparation of project in f n memorandum.

Syndication of financial requirements of customers. PFD offers

syndication services in arranging finance to customers funding

requirements.

OFD offers services to new projects or expansion of existing

projects in raising long term debts & or working capital limits.

PFD offers services to customers resorting to restructure their

existing debt profile by swapping high cost debt with low cost

debt.

Anywhere banking:

Anywhere Banking is a technology based customer friendly service

designed to provide greater convenience to our customers.



With Anywhere Banking facility, once you have an account with any

of the select branches. You can operate it from any other designated

branch across as cities.

With any where banking you have a lost of facilities to make banking

with us.

Facilities

Individuals / Joint account holder [operated severally] maintaining

current / SB / OD Accounts.

Withdrawal of cash

Remittance of cash

Transfer of funds

Balance Enquiry

Issue of mini statement

Depositing local cheques for collection

Purchase of demand draft.

Firms / companies / other Bodies maintaining current / OD/

OCC Accounts:

Transfer of funds between accounts from one anywhere

banking branch to another anywhere banking branch depositing of local

cheques for collection & crediting to the respective account at any where

banking branch.



Eligibility:

Account holders should have maintained a minimum average balance

of Rs 5000/- in SB Account & Rs 10000/- in current account in the last

six months.

Features:

Cash with draw unto Rs 50000/- per occasion Transactions

permitted on production of Identity card issued exclusively for ANY

WHERE BANKING Facility.

Facilities of both intra – city & inter – city transactions HOME

CLEARING – on line debit of cheques drawn on our own AWB

branches. DD issue – unto a limit of Rs 50000/- at any AWB branch.

Liquidity U/ S profitability:

Liquidity & safety principal aims at meeting demand of depositors

for cash in full & in time & is considered just one principle . That is

principle of liquidity but profitability aims at paying of a hand some

dividend to the share holders.

The objectives of both the principal are complicating in their nature.

These words they are opposing considerations. The most liquid assets if not

at all profitable & the most profitable asset is least liquid.



CHAPTER-4

PROFILE OF THE VIJAYA BANK

Introduction:

Vijaya Bank was founded by Late Shri A.B.Shetty & other enter-

praising formers founded Vijaya Bank on 23rd October 1931 in Mangalore,

Karnataka the objective of the founders was essentially to promote Banking

habit. Thrift & entrepreneurship among the farming community of Dakshina

Kannada district in Karnataka state. The bank become a scheduled bank in

1958, Vijaya Bank steadily grew into a large all India bank with a smaller

banks merging with it during the 1963-68. The credit for this merger as well

as growth goes to late Shri M.Sunder Ram Shetty, who was then the chief

Executive of the bank. The bank was nationalized on 15 th April 1980 today,

the bank has built a network of 842 branches that span all 28 states & 4

union territories in the country.

SHARE CAPITAL :

The share capital of Vijaya Bank is held by government of India and

institutional investor such as mutual funds UTI, Insurance Company. Other

finance institution & private corporate bodies, Indian public NRI s And

other commercials banks, Government of India acts as a promoter of the

bank, it assist & guides the bank in times of financial difficulties.



The distribution of share holding as in 31 –3 – 2005 is given below.

Category No. of shares

held

Amount in Rs % In

total

A. Promoters holding

Government of India

23,35,17,800 2,33,51,78,000 53.87

B. Banks & financial institutions

(central /state institutions

1,77,43,420 17,74,34,100 4.09

Mutual Fund 1,67,24,545 16,72,45,450 3.86

Body corporate 1,37,73,148 13,77,31,480 3.18

NRI s locb s 6,21,38,548 62,13,85,480 14.33

Resident holdings 8,96,20,349 89,62,03,490 20.67

Total 43,35,17,800 4,33,51,78,000 100



Loans & Advances:

Vijaya Bank provides various types of loans & Advances to all the

classes of people. As its caption ‘Your partner in progress says the services

provides by the bank.

The different types of loan schemes provided

Educational loans

Rent scheme

Liquidity Finance to SSI

Jewel loans

Loans for purchase of equipment

Loans on motor vehicle

Housing loan

Advance to small road transport operators

Finance for trading activities

Loans for investment resumes

Agricultural Finance

Branch Network :

In the year 1963-68 nine small banks merged with the Vijaya

Bank. During the year 2001-02 bank nationalized its branch network by

merging 16 branches with the nearby branches covered its regional foreign



exchange cell at Bangalore in to a specialized over seas branch, as a result

the total number of branches stood at 828 as at the end of 4 th March 2002,

as compared to 842 a year ago. During the year the banks has offered 2

extension converters closed on extension counter upgraded an extension

counter into a full pledged branch.

On a international front the bank built a network relationship with

over 200 banks in 80 countries across America, Europe & middle cast.

Computerization:

The bank has 87 computerized branches upgrading two partially

computerized branches to total computerization lacking the number of

totally computerized & branches to 328 & 10 respectively, converting

76.73 % of aggregate business of bank.

Credit cards: Vijaya Bank given visa and master card credit for both

individuals & corporate. These cards are accepted at over 100000

members estimated across the country & Nepal.

Vijaya Bank credit cards come along with unique & attractive feature

like.

Vijaya Cash:

Instant cash withdrawal is available when ever needed. Walk –

in to any of 831 branches across the country draw unto Rs 5000 /- per

month for classic cards and Rs 10000 /- for gold cards through the

passbook supplied along with the card.



Vijaya Security: Vijaya bank credit card brings along 24 hours

personal accident insurance coverage in the unfortunate event of the card

holder death.

Classic card holders – upto Rs 100000

Gold card holders - up to Rs 200000 in case of Road accidents

Rs. 400000 in case of the Death an air crash.

Vijaya Family cards:

Vijaya Bank add on credit cards are available for parents, spouse

children of card holder above the 18 years of age regardless of his/her

income building under the add on is charged to the main card holder.

Board of directors:

The management of broad of the bank is vested with the board

of directors. Board of directors of Vijaya Bank other than director of

central Government elected under the terms of Vijaya bank general

regulations, 1998 & sec 9 (3) ( I ) of the banking companies act 1980

read with the banking regulation act 1949 nationalized banks scheme

1980.

The present strength of board of directors of the bank is 7,

comprising of 1 executing & 6 non executive directors having diversified

professional experience. The directors have been contributing their

professional knowledge, experience & expertise in respective areas of

their specialization for the development.



Sl.No Name of Director Designation Nature of

Directorship

Date of

assuming

1 Shri M.S.Kapur Chariman

& Managing

Director

Executive -

Director

16-8-02

2. Shri. M.S. Aftab Executive

Director

Executive

Director

02-11-04

3. Shri.A.K.RAi nominee-GOI Non Executive

Director

1-6-04

4. Shri . S.P.Krishna

Swamy

Nominee- share

holders

Non-exicutive

director

3-8-02

5. Shri ,R.Ashok

kumar

Nominee- share

Holder

Non –

ExecutiveDirector

3-8-02

6. Shri,A.Padmanabha

Shetty

office employee

director

Non - Executive

Director

16-9-04

7. Shri,P.Krishna

Murthy

Nominee -RBI Non- Executive

Director

31-3-05

8. Shri, B.K. Jagdish

chandra

Nominee- share

holders

Non- Executive

director

3-8-02

9. Shri, S.Ananthan Niminee-Share

holder

Non-Executive

Director

3-8-02



10. Shri, Manivarjana S.

Madinur

workmen-

director

Non – Executive

Directors

3-8-02

CHAPTER-5

ANALISIS AND INTERPRETATION

Deposit: Deposit creation is an important function of commercial

bank. The bank attracts deposits from the people either by means offering

interest or other facilities business people want facilities with draw more

then investment.

Meaning : Deposits represents the amounts accepted by a bank from the

deposits it is the most important item on the liability side because

o They are major portion of the funds received by a Bank

o The capacity of a bank to earn profits depends on the volume of

deposits

o The efficiency of a bank is judged by its ability to attract

deposits.

Types of deposits : There are two types of deposits are :

Deposits

Term Deposits Demand Deposits



Saving Bank Deposit scheme :

These are opened by middle & low income groups who save then part

of present income for future needs proper introduction is necessary when

accounts are operated by cheques. A low rate of interest provided on the

deposited money.

Terms and conditions in the savings bank deposit scheme :

Conditions which are required for opening Saving Bank Account

Savings Bank Account may be opened by the following, who are known

at the bank or are properly introduced by other.

An individual in His / Her own name

By more than one person in their joint names payable to all of them

jointly or any one of them or more than one or survivor’s

By natural guardian of a minor on behalf of the minor or by a person

in the name of any minor of whom he or she is a guardian appointed

by a competent court. The guardian on behalf of a minor should

furnish a declaration as t the date of the birth of the minor.

By a minor over the age of 12 years in his own name in which case

the maximum balance in the minors account shall be restricted to Rs

10000 / - only, provided the minor produces satisfactory proof of

his / her date of birth such as school certificate etc.

By secretaries, Treasurers, managers or other duly constituted or

authorized officers of any club, school, orphanage, Temple, Mosque,


Fixed Deposit

Recurring Deposit

Current Account Deposit Saving Bank

A/c Deposits


church or other religious / charitable institutions of like nature

provided the rules & by laws governing such institutions is acceptable

to the bank.

Companies licensed by the central government under section 25 of the

companies Act 1956, & institutions, which are not liable to pay

income tax under income tax act 1961.

How to open savings Bank Deposit Account:

Persons desiring to open savings Bank Accounts are required to fill in

& sign application form [11-394] along with the usual specimen

signature cards, producing two pass port size photographs, details of

PAN / GIR numbers or declaration in form No 60161 as the case may be

& an introduction from a person acceptable to the bank .

Minimum Balance Amount Required to open An Savings Bank

Account :

A savings Bank A / C may be opened with a minimum balance of Rs

250/ in fully computerized branches & Rs 100/- in other branches to keep

the account running . The same minimum balance should always be

maintained. If a cheque book is issued, the account shall have a

minimum balance of Rs 250/-.

Minimum balance to be maintained

Fully computer ised

branches

Other

branches

For opening / maintaining SB

Account [ with out cheque book]

Rs 250 /- Rs 100/-

For opening / maintaining savings Rs 250 /- Rs 250/-



bank a/c s [ with cheque book

facilities]

The details are specific in a chart i.e. minimum balance / Amount

required to open an savings bank account

If the savings bank account shows balance below the minimum for a

continuous period of one year or above, the branch may at its discretion

close such Accounts.

Further Non – maintenance of minimum balance as stipulated above

attracts penalty charges are Rs 12/- per occasion.

Cheque Books: Cheque books shall be issued only against production

of duly signed requisition slip from the previous cheque book issued .

Restriction, conditions for with drawl’s in the Savings Bank Deposit

Account:

There is a restriction for the withdrawal of the amount in the

Savings Bank Deposit Account.

The total number of with drawls i.e. debit in Savings Bank

Account should not exceed 50 every half year. It is the obligation of

the account holder to take care of the cheque books issued to him or

her.

Interest paid to Savings Bank Account :



Interest is allowed on the savings bank account on a half yearly

basis at the rate prescribed by the RBI on minimum monthly balance

between the 10th & the lost day of the month at the credit of each

account on a minimum balance of Rs 10/- & above & on multiple of

Rs 10/- provided interest thus calculated does not fall short of Rs 1/-

per half year.

Interest will be calculated for the half year ending 31 st January

& 31st July each year & will be credited to each account on or before

the 10th February & the 10th August respectively each year.

.

5.1 Table showing % & Increase / Decrease of saving’ s Bank deposit

Account

Years Total amount of

Deposit

% to the Base

year

% of Increase

/ decrease

2000 – 01 3,81,19,410 100% 0

2001-02 4,23,54,900 112% 12%



2002-03 4,70,61,000 124% 24%

2003-04 5,22,90,000 137% 37%

2004-05 5,81,00,000 152% 52%

INTERPRETATION:-

From the above table, we can observe that the amount deposited

in Saving Bank Account has been increased gradually from 2000-01

to 2004-05 . That is in the base year 2000-01 the % of deposit is 100%

then it has been increased to 112 % in the year 2001-02, 137% in

2003-04, & 152% in the year 2004-05.

We can analyse that the % of deposit in this deposit scheme is

in increasing trend, so, we can conclude that this scheme is

performing well in attracting the savings of the people.

5.1 Chart showing % & Increase / Decrease of saving’ s Bank deposit

Account



0%

12%

24%

37%

52%

0%

10%

20%

30%

40%

50%

60%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005

% of Increase/ decrease

5.2 Table showing New Account opened in Savings Bank Account.

Years Total no. of

persons

Deposited

% to the Base year % of Increase

/ decrease

2000 – 01 3500 100% 0



2001-02 3650 104% 4%

2002-03 3980 114% 14%

2003-04 4390 125% 25%

2004-05 4630 132% 32%

INTERPRETATION:-

From the above table, we can observe, that the no. of persons

deposited in saving Bank A/c has been increased gradually from

2000-01 to 2004-05 . That is in the base year 2000-01the % of Deposit

is 100% ,then it has been increased to 104% in the year 2001-02, 114

% in the year 2003-03 125% in 2003 –04 , & 132% in the year 2004-

05.

We can Analyse that the % of no. of persons deposited in this

scheme is in increasing trend, so, we can conclude that this scheme is

performing well in attracting the saving of the people.

5.2 Chart showing New Account opened in Savings Bank Account.



0

4%

14%

25%

32%

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005


5.3 Table showing total interest amount paid by the bank to savings

Bank Deposit holders.

Years Total amount

deposited

Rate of interest Interest amount

paid by the bank



2000 – 01 3,81,19,410 3.5% 13,34,179.35

2001-02 4,23,54,900 3.5% 14,82,421.5

2002-03 4,70,61,000 3.5% 16,47,135.0

2003-04 5,22,90,000 3.5% 18,30,150.0

2004-05 5,81,00,000 3.5% 20,33,500.0

INTERPRETATION:-

From the above table, we can observe that the interest amount

paid by Bank to Saving Bank A/c holders it has been increased

gradually from 2000-01 to 2004-05 that is in the base year 2000-01

the amount of interest is 13,34,179.35 . Then it has been increased to

14,82,421.5 in the year 2001-02, in the year 2002-2003 the amount of

interest is Rs 16,47,1`35 & in the year 2003-04 the amount is

18,30,150 & in the year 2004-05 the amount paid is Rs 20,33,500.

We can analyse that the interest amount of deposit in its scheme

is in increasing trend, so we can conclude that this scheme is

performing well in attracting the savings of people.

5.3 Chart showing total interest amount paid by the bank to savings

Bank Deposit holders.



1334179.35

1482421.50

1647135.001830150.00

2033500.00

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005

5.4. Table showings percentage paid by the bank in savings Bank

Account

Years Total interest

amt paid

% to the Base

year

% of Increase



/ Decrease

2000 – 01 13,34,179.35 100% 0

2001-02 14,82,421.5 116% 10%

2002-03 16,47,135.0 123 % 23%

2003-04 18,30,150.0 137% 37%

2004-05 20,33,500.6 152 % 52%

INTERPRETATION:-


in saving Bank A/c has been increased gradually from2000-01 to

2004-05. I,e in in the base year 2000-01 the % of interest amount is

1005, then it has been increased to 110% in the year 2001-02, 123%

in the year 2002-03, 137% in 2003-04 & 152%in the year 2004-05

We can Analyse that the % of interest amount in this deposit

scheme is in increasing trend, so we can conclude that this scheme is

performing well in attracting savings of the people.

5.4. Chart showings percentage paid by the bank in savings Bank

Account



0%

10%

23%

37%

52%

0%

10%

20%

30%

40%

50%

60%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005


2. Current Account:

These are opening by trading & industrial concern a

minimum deposit of Rs 200000 Rs 300000 through proper and



satisfactory introduction rate of interest is not provided here,

customers can deposit any amount of money and any number of times

and withdraw & as many times as they want.

Terms & conditions in current Account :

Conditions required for opening current Account :

The following persons, firms etc who are properly introduced,

may open current account by singing the prescribed account opening

form [s] along with PAN / GIR numbers or declaration in form No.

60/61

An individual in his / her own name

More than one individual in their joint names

payable to all of them jointly or any one or more of

them or survivor [s]

A Hindu undivided Family, a proprietor ship

concern, a partnership firm, a company, a trust, a

local body, government department etc., in its own

name by giving clear operational instructions.

Obtaining of photographs :



In terms of reserve Bank of India’s guidelines, photograph should be

given at the of opening of all categories of deposit of opening of all

categories of deposit accounts includes current account of both resident

& Non resident account holders inclusive of persons authorized open /

operate the accounts as application.

Minimum Balance Amount Required to open an Current Account:

A current Account may be opened with a minimum of Rs 1000/- in

fully / partially computerized branches & Rs 500/- in other branches.

However at specialized commercial & branches irrespective of the

location of the branches. However at specialized commercial & personal

banking branches this is Rs 10,000/- for Current Accounts. If the

prescribed minimum balance is not maintained in the current account Rs

28/- per occasion with a maximum of Rs 500/- per month will be

collected.

Interest on credit Balance : Interest is not allowed on the credit balance

maintained in current accounts.

Incidental / falio / Handing charges

Bank will collect charges for the ledger folios used in current accounts

at the rate prescribed below :

Rs 66/- per ledger page [ 40 entries or part their of considered as one

ledger page ] & Rs 83/- per computer statement sheet on a half - yearly



basis subject to the concession provided on maintained of average

balance

Average credit Balances Free ledger Folio pages

allowed per year

Up to Rs 25000 Nil

Above 25000/- unto Rs 50000/- 3

Above Rs 50000.- Unto Rs 100000/- 6

Above Rs 100000 /- up to Rs 200000/- 11

Above Rs 200000/- All

5.5 Table showing % of Increase / Decrease of current Account



Years Total amount

deposited

% to the Base

year

% of Increase

/ decrease

2000– 01 11, 90 000 100% 0

2001-02 13, 94 000 117% 17%

2002-03 14, 45, 000 121% 215

2003-04 15,64,000 131% 31%

2004-05 17,00,000 1425 42%

INTERPRETATION:-


in current account has been increased gradually from 2001-01 to

2004-05 . That is in the base year 2000 – 01 to 2004-05. That is in

the base year 2000-01 the % of deposit is 100% . Then it has been

increased to 117 % in the year 2001-02, 121 % in the year 2002-03,

131 % in 2—3-04 & 142 % in the year 2004-05.

We can Analyse that the % of deposit in this deposit scheme is

in increasing trend, so, we can conclude that this scheme is


5.5 Chart showing % of Increase / Decrease of current Account



0%

17%21%

31%

42%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005


5.6 Table showing New Accounts opened in Current Account.



Years Total interest amt

paid

% to the Basic year


2000 – 01 50 100% 0

2001-02 85 170% 70%

2002-03 94 188% 88%

2003-04 108 216% 116%

2004-05 122 244% 114%

INTERPRETATION:-

From the above table, we can observe that the No, of persons

deposited in current A/c has been increased gradually from 2000-01 to

2004-05. That is the base year 2000-01 the % of deposited persons is

100% . Then it is increased to 170% , it is creased to 188 % in the

year 2002-01, in 2003-04 it has been increased to 216 % & in 2004-

05 it has been increased to 244%.

We can Analyse that the % of No, of persons deposited in this

scheme is in increasing trend, so, we can conclude that this scheme is

performing well in attracting the current A/c of the people.

5.6 Chart showing New Accounts opened in Current Account



0%

70%

88%

116% 114%

0%

20%

40%

60%

80%

100%

120%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005


TERM DEPOSIT



Recurring deposit Account; These deposits are meant for

people who have regular monthly incomes. Deposited amounts will

be in the multiples of Rs 5 & Rs10. Here the depositor deposits a

fixed sum of money every month for an agreed period & at the end of

the specific period the deposited money along with the interest can be

with drawn.

This scheme helps in savings easily & systematically, through

either fixed or variable monthly installments. You can choose any

deposit period ranging from 6 to 120 months, in completed 3 months.

Under variable monthly installments you have the option to choose a

core monthly installment [ witha minimum of Rs 10/- or multiples]

and remit any amount subject to this minimum with a maximum of ten

times of the more monthly installment.

It is one form of savings deposits . Depositor save & deposit

regularly every month a fixed installment so that they are assured of

the sizeable amount at a later period. There will enable the depositors

at meet contingent expenses. Banks have found these deposits

popular. Many people would not have saved if these deposits had not

been introduced this deposit works on the maxim “little drops of

water make a big ocean “.

Terms & conditions for opening account:



Any person can open this deposit account he can even have

more than one account at a time. This account can be opened joint

names also.

It may be opened for monthly instilments in sums of Rs 5/- or

in multiples of Rs5/- with a maximum of Rs 1000/- the number of

monthly instilments may very from 12 months to 72. The total

amount is repayable 30 days after the last installment has been paid.

For deposits of higher installments. The maturity amounts can

be calculated as multiples of the maturity amount for an installment of

Rs5.

Every depositor should pay the monthly installments with in 30

days from the due date. If he fails to do so, interest will be charged on

the installments in arrears the rate of 4 paisa for every Rs5/- per

month.

A recurring deposit holder can get a loan on the security of a

recurring deposit. The banker may grant 75 % of the total amount paid

as loan & the interest of 2% over the recurring deposit rate is charged.

These accounts are transferable from one branch ot another. A

recurring deposit holder is given the recurring deposit pass book for

his verification. The rate of interest is similar to the rate offered on

fixed but it is compounded



5.7 Table showing % of increase / Decrease recurring deposit

account.

Years Total Amount

Deposited

% to the Base

year

% of Increase

/ decrease

2000 – 01 2,47,200 100% 0

2001-02 2,87,800 116% 16%

2002-03 2,88,400 117 % 17%

2003-04 3,70,300 150% 50%

2004-05 4,12,000 166 % 66%

INTERPRETATION:-

From the above table we can observe that the amount deposited

in recurring deposit A/c has been increased gradually from 2000-01

to 2004—05 that is in the base year 2000-01 the % of deposit is 100%

, then it has been increased to 116% , & 117% in the year 2002-03,

150% in 2003-04 , 166% in the year 2004-05.

We can analyse that the % of deposit is this deposit scheme is

in increasing trend; so, we can conclude that this scheme is


5.7 Chart showing % of increase / Decrease recurring deposit account



0%

16% 17%

50%

66%

0%

10%

20%

30%

40%

50%

60%

70%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




5.8 Table showing new Account opened in recurring deposit

account .

Years No. person

deposited

% to the Basic

year

% of Increase

/ decrease

2000 – 01 0 0 0

2001-02 8 100% 0

2002-03 17 212.5% 112.5 %

2003-04 24 300% 200%

2004-05 28 350% 250%

INTERPRETATION:-

From the above table, we can observe that the no. of persons

deposited in recurring deposit A/c has been increased gradually from

2000-01 The % of deposited persons in Nil, i.e. there is no person

invested their money in the recurring deposit A/c. Then it has been

increased to 100% in the year 2000-02, 212.5% in the year 2002-03 &

300% in 2003-04 & in the 2004-05 it has been increased to 350%.

We can analyse that the % of deposit in this deposit scheme is

in increasing trend. So, we can conclude that this scheme is




5.8 Chart showing new Account opened in recurring deposit account

0% 0%

112.50%

200%

250%

0%

50%

100%

150%

200%

250%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




5.9 Table showing total interest amount paid by bank on the recurring

deposit account.

Years Total interest

amt paid

% to the Basic

year

% of Intrease

/ decrease

2000 – 01 2,47,200 3.5 % 8652

2001-02 2,87,400 3.5% 10073

2002-03 2,88,400 3.5% 10094

2003-04 3,70,300 3.5% 12978

2004-05 4,12,000 3.5% 14420

INTERPRETATION:-


paid by Bank to recurring deposit A/c holders it has been gradually

increased from 2000-01 to 2004-05. That is in the base year 2000-01 the

amount of interest is 8652, then it has been increased to 10073 in the year

2001-02, 10094 in the year 2002-2003, 12978 in the year 2003-04 14420

in the year 2004-05.

We can analyse that the interest amount of deposit in this scheme is in

increasing trend, so we can analyse that this scheme is performing well in

attracting the savings of the people.



5.9 Table showing total interest amount paid by bank on the recurring

deposit account.

8652.00

10073.00

10094.0012978.00

14420.00

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005



5.10 Table showing % Percentage paid by the bank in recurring

deposit account.

Years Interest amt paid % to the Basic

year

% of Increase

/ decrease

2000 – 01 8652 100% 0

2001-02 10073 116% 16%

2002-03 10094 117 % 17%

2003-04 12978 150% 50%

2004-05 14420 166 % 66%

INTERPRETATION:-

Form the above table we can observe that the interest amount in

recurring deposit account has been increased gradually from 2000-01 to

2004-05 , That is in the base year 2000-01 the % of interest amount is

100% . Then it has been increased to 116% in the year 2001-02, 117% ,

in the 2002-03 , 150% in the year 2003-04 & 166% in the year 2004-05.

We can analyse that the % of interest amount in this deposit

scheme is in increasing trend, so we can conclude that this scheme is

performing well in attracting savings of the people.



5.10 Chart showing % Percentage paid by the bank in recurring

deposit account.

0%

16%17%

50%

66%

0%

10%

20%

30%

40%

50%

60%

70%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




Fixed Deposit Account : [ Term Deposits]

These are operated by small investments by depositing fixed

amount fixed periods fixed rate of interest. The deposited money is with

drawn after the expiry of fixed receipt issued by the bank at the time of

opening account.

A fixed deposit is one which is repayable after the expiry of a predator

mined period fixed by the customer himself. The period varies from 15

days to 3 years. A deposit account can be opened fro a period of more

than 3 years & in that case the rate of interest remains the same level.

These deposits are not payable on demand but they are withdrawal

subject to a period of notice. Hence it is called as term deposits.”

Terms & conditions to the fixed deposit account:

Opening Account: The fixed deposit holder is expected to fill

up an application form prescribed fro the purpose, stating the amount &

the period of deposit. The application itself contains the rules &

regulations of the deposit in addition to the space for specimen signature.

As in opening a correct account, a banker does not insist upon a letter of

introduction or reference for fixed deposit account because of the absence

of frequent transaction on the account.

Interest : The interest rate offered on the fixed deposit is so

attractive that it has resulted in a change in the composition of bank

deposits. Till recently, most of the deposits of commercial banks has

been demand deposits & new fixed deposits occupies more than 70% of



bank deposits. The rate of interest varies according to the period of

deposit. In Indian banking history the firs ever highest interest rate of

15% was offered on term deposits for 1-2-97 on wards,

However, in recent times, the RBI, has deregulated the interest rates

on fixed deposit. The banks are given the freedom to fix their own rates for

different periods.

How ever the special rates have been fixed for deposits of senior

citizens of 60 years of age or above giving them some schemes.

The present rates applicable to the fixed deposits in case of senior

citizens.

Serial No. Term of deposit 1

years to less than 2

years

Interest per Annum

1 1 years to less than 2

years

6%

2 2 years to less than 3

years

7%

3 3 years & above 7.5%



Table showings the present interest paid by the bank to fixed deposit

holder for different periods.

Serial No. Term of deposit 1

years to less than 2

years

Interest per Annum

1 1 day to 14 days Nil

2 15 days to 45 days 4.25%

3 46 days to 179 days 5%

4. 139 days to 1 years 5.5 %

5. 1 years to 3 years 5.75%

6. 3 years & above 6%

Period of the deposit ; The minimum period has been fixed as low

as 7 days, A per the guidance of the Indian banks Association , banks

should not accept deposits for a period longer than 10 years. If the

maturity date of fixed deposit fassa a holiday, it should be paid only on

the succeeding working day, since a fixed deposit not be claimed before

the maturity date as per the terms of original contract.

Fixed deposit receipt ; At the time of opening the deposit account,

the banker issued a receipt acknowledging the receipt of money on

deposit account. It is popularly known as F.D.R [Fixed Deposit Receipt].

It contains the amount of deposit, the name of the holder of the deposit,

the rate of interest, due date etc. On the reverse side of the F.D.R

separate columns are provided for making entries regarding interest.



Particular of A. F. D. R

1. Name of the bank & place

2. Due Date

3. Date

4. Name of the Depositor

5. Amount

6. Period

7. Interest Rate

8. Signature of the manager

Fixed Deposit Receipt

{Face View}

VIJAYA BANK ITD

No: 12345 Due on

Chickballapure Branch

Date ……………..2005

Received from ------------------------------------------------------------------

Rupees --------------------------------------as fixed deposit repayable

in -------------------------months after date with interest at the rate

----------------% per Annum

RS Accountant Manager



Back View of V.D.R

Memorandum Payment of Interest

1. This F.D.R dully discharged should

be surrendered at the time of payment or

renewal of deposit. To prevent loss of

interest, the receipt intended for renewal

should be sent on due date

Date Half

year

ended

Amount Signature of

Authorized

person

2. The F.D.R is not transferable by

endorsement. In the absence of special

instructions . The amount of F.D.R can

be paid only to the depositor in person.

3. Rate of interest overleaf is subject to

resource bank P directive issued from

time to time.

Received payment / please renew ……..

month / years

Signature of the depositors



5.11 Table showing % of increase / decrease of savings Bank deposit

account

Years Total amount

deposited

% to the Basic year % of Increase

/ decrease

2000 – 01 7995000 100% 0

2001-02 9225000 115% 15%

2002-03 10086000 126% 26%

2003-04 10455000 130% 30%

2004-05 12300000 154% 54%

INTERPRETATION:-


in fixed deposit account has been increased gradually from 2000-01 to 2004-

05 that is in the base year 2001-01 % of deposit is 100% . Then it has been

increased to 115% . 126% in 2002-03 , 130% in 2003-04 , 154% in 2004-05.

We can analyse that the % of deposit in this deposit scheme is in

increasing trend. So, we can conclude that this scheme is performing well in

attracting the deposits of people.



5.11 Table showing % of increase / decrease of savings Bank deposit

account

0%

15%

26%30%

54%

0%

10%

20%

30%

40%

50%

60%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005


5.12 Table showing new accounts open in fixed deposit account.



Years Total

interest amt

paid

% to the Basic

year

% of Increase

/ decrease

2000 – 01 98 100% 0

2001-02 115 117% 17%

2002-03 140 143% 43%

2003-04 158 161% 61%

2004-05 165 168% 68%

INTERPRETATION:-

From the above table, we can observe that the No. of persons

deposited in fixed deposit A/c has been increased gradually from 2000-01 to

2004-05 . That is in the base year 2000-02 the % of deposit is 100% . Then it

has increased to 117% , 143% in 2002-03 , 161% in 2003-04 , 168 % in the

year 2004-05

We can analyse that the % of No, of persons deposited deposited in

this scheme is in increasing trend, so, we can conclude that this scheme is


5.12 Chart showing new accounts open in fixed deposit account.



0%

17%

43%

61%

68%

0%

10%

20%

30%

40%

50%

60%

70%

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




5.13 Table showing total interest rate amount paid by bank to F.D

holder who deposit their money for the period of 15-45 days.

Years Amount Deposited Term of

Deposit

Rate of

Interest

Total interest amount

2000 – 01 7995000 15-45 days 4.25 % 339787.5

2001--02 9225000 15-45 days 4.25 % 392062.5

2002--03 10086000 15-45 days 4.25 % 428655.0

2003--04 15,64,000 15-45 days 4.25 % 444337.5

2004--05 17,00,000 15-45 days 4.25 % 522750

INTERPRETATION:-

From the above table, we can observe that the interest amount paid by

bank to fixed deposit holders for the period of 15-45 days is increased

gradually from 2000-01 The amount of interest is 339787.5 , then it has been

increased to 392062.5 in 2001-01, 428655.0 in 2002-03 , 444337.5 in 2003-

04 522750 in the year 2004-05.


increasing trend, so, we can conclude that their scheme is performing well in

attracting deposits from people.



5.13 Chart showing total interest rate amount paid by bank to F.D

holder who deposit their money for the period of 15-45 days.

339787.50

392062.50

428655.00

444337.50

522750.00

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




holder who deposit their money for the period of 46 to 179 days.


Deposit

Rate of

Interest


2000 – 01 7995000 46 to 179 days 5 % 399750

2001--02 9225000 46 to 179 days 5 % 461250

2002--03 10086000 46 to 179 days 5 % 504300

2003—04 10455000 46 to 179 days 5 % 522750

2004—05 12300000 46 to 179 days 5 % 615000

INTERPRETATION:-


bank to the fixed deposit holders for the period of 46 to 179 days is

increased gradually from 2000-01 to 2004-05 that is in the base year 2000-

01 interest amount is 399750, then it has been increased to 461250 in the

year 2001-02, 504300 in the year 2002-03 , 522750 in the year 2003-04

615000 in the year 2004-05.


increasing trend, so, we can conclude that this scheme is performing well in





holder who deposit their money for the period of 46 to 179 days.

399750.00

461250.00

504300.00

522750.00

615000.00

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




holder who deposit their money for the period of 180 days t 1 year.


Deposit

Rate of

Interest


2000 – 01 7995000 180 to 1 year 5 .5% 439725

2001--02 9225000 180 to 1 year 5 .5% 507375

2002--03 10086000 180 to 1 year 5 .5% 554730

2003—04 10455000 180 to 1 year 5 .5% 575025

2004—05 12300000 180 to 1 year 5 .5% 676500

INTERPRETATION:-

From the above table , we can observe that the interest amount paid by

bank to the fixed deposit holders for the period of 180 to 1year is increased

gradually from 2000-01 to 2004-05 that is in the base year 2000-01 interest

amount is 439725, then it has been increased to 507375 in the year 2001-02,

554730 in the year 2002-03 , 575025 in the year 2003-04 676500 in the year

2004-05.







holder who deposit their money for the period of 180 days t 1 year.

439725.00

507375.00

554730.00

575025.00

676500.00

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




holder who deposit their money for the period of 1 year to 3 years

Years Amount

Deposited

Term of Deposit Rate of

Interest


2000 – 01 7995000 1 year to 3 years 5 .75% 4,59,712.5

2001--02 9225000 1 year to 3 years 5 .75% ,30,437.5

2002--03 10086000 1 year to 3 years 5 .75% 5,79,945.0

2003—04 10455000 1 year to 3 years 5 .75% 6,01,162.5

2004—05 12300000 1 year to 3 years 5 .75% 7,07,250.0

INTERPRETATION:-


bank to the fixed deposit holders for the period of 1year to 3 years is


01 interest amount is paid by bank is 459712.5 , then it has been increased

to 530437.5 in the year 2001-02, 579945.0 in the year 2002-03 , 6,01,162.5

in the year 2003-04 7,07,250.0 in the year 2004-05.







holder who deposit their money for the period of 1 year to 3 years

459712.50

579945.00

601162.50

707250.00 30437.50

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




holder who deposit their money for the period of 3 years & above.

Years Amount

Deposited


Interest


2000 – 01 7995000 3 years & above 6 % 479700

2001--02 9225000 3 years & above 6 % 553500

2002--03 10086000 3 years & above 6 % 605160

2003—04 10455000 3 years & above 6 % 627300

2004—05 12300000 3 years & above 6 % 738000

INTERPRETATION:-


bank to the fixed deposit holders for the period of 3 years & above is


01 interest amount is paid by bank is 479700 , then it has been increased to

553500 in the year

2001-02, 605160 in the year 2002-03 , 627300 in the year 2003-04 , 733000

in the year 2004-05.







holder who deposit their money for the period of 3 years & above.

479700.00

605160.00

627300.00

738000.00

553500.00

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005




holder who deposit their money for the period of 1 day to 14 days .

Years Amount

Deposited


Interest


2000 – 01 7995000 1-14 days Nil 7995000

2001--02 9225000 1-14 days Nil 9225000

2002--03 10086000 1-14 days Nil 10086000

2003—04 10455000 1-14 days Nil 10455000

2004—05 12300000 1-14 days Nil 12300000

INTERPRETATION:-


bank to the fixed deposit holders for the period of 1-14 days is increased

gradually from 2000-01 to 2004-05 that is in the base year 2000-01 interest

amount is paid by bank is 7995000 in this scheme there is no interest for

this scheme period of deposited is lees so there is no interest.




holder who deposit their money for the period of 1 day to 14 days .

7995000

10086000

10455000

12300000

9225000

2000 – 2001 2001 – 2002 2002 – 2003 2003 – 2004 2004 – 2005



Vijaya Cash Certificate : It is scheme which introduced by the Vijaya

bank it is the scheme in the fixed deposit accoutn . The anme itself says its

belong to the vijaya bank.

Vijaya cash certificate scheme is a convenient way to save for your

children’s higher education or to build a house etc.,

This scheme helps you to build on your capital along with the benefit

of compound interest. Available in denominations of Rs 100/- & multiple

there of, you can choose certificate for any period ranging from 6 months to

10 years.

Terms & conditions required

There is no restriction to take the Vijaya cash certificate.

No need of introduction because it is fixed for a

particular period.



5.19 Table showing % of increase/ decrease of Vijaya cash certification

Years Total amount of

Deposits

% To the Basic year % Of Increase

/ Decrease

2000 – 01 17435000 100% 0

2001-02 20605000 118% 18%

2002-03 23775000 136% 36%

2003-04 30115000 172% 72%

2004-05 31700000 182 % 82%

INTERPRETATION:-

From the above table , we can observe that the amount deposits in the

Vijaya cash certificate has been increased gradually from 2000-01 to 2004-

05 that is in the base year 2000-01 the % then it has been increased to 118%

in the year

2001-02, 136% the year 2002-03, 172% the year 2003-04, 182% the year

2004-05.



attractign the savings of the people.



5.19 Chart showing % of increase/ decrease of Vijaya cash certification

0%

18%

36%

72%

82%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2000-2001 2001-2002 2002-2003 2003-2004 2004-2005



5.20 Table showing No. of persons deposited their money in vijaya cash

certificate

Years No. of persons

Deposits

% To the Basic year % Of Increase

/ Decrease

2000 – 01 460 100% 0

2001-02 499 108% 8%

2002-03 550 120% 20%

2003-04 580 126% 26%

2004-05 630 137% 37%

INTERPRETATION:-

From the above table , we can observe that the amount deposits in the


05 that is in the base year 2000-01 the % of deposit is 100%. Then it has

been increased to 108% in the year 2001-02, 120% the year 2002-03, 126%

the year 2003-04, 137% the year 2004-05.

We can analyse that the % of No. of parsons deposit i scheme is in





5.20 Chart showing No. of persons deposited their money in vijaya

cash certificate

0%

8%

20%

26%

37%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2000-2001 2001-2002 2002-2003 2003-2004 2004-2005



5.21 Table showing total interest amount paid by bank to Vijaya cash

certificate holders:

Years Amount Deposits % To the Basic year % Of Increase

/ Decrease

2000 – 01 1,74,35,000 6% 10,46,100

2001-02 20,60,5000 6% 12,36,300

2002-03 2,37,75,00 6% 14,26,500

2003-04 3,01,15000 6% 18,06,900

2004-05 3,17,00,000 6% 19,02,000

Note: In this table the Tate of interest will be taken 6% if a person deposited

amount for 3 years & above. If the period differs rate of interest also differs.

INTERPRETATION:-


Vijaya bank cash certificate holders it has been increased gradually from

2000-01 to 2004-05 that is in the base year 2000-01 interest amount is paid

by bank is 10462100, then it has been increased to 1236300 in the year

2001-02, 1426500 in the year 2002-03, 18,06,900 in the year 2003-04,

19,02,000 in the year 2004-05.

We can analyse that the amount deposit i scheme is in increasing

trend, so, we can conclude that this scheme is performing well in attracting

the savings of the people.



5.21 Table showing total interest amount paid by bank to Vijaya cash

certificate holders:

1046100

1236300

14265001806900

1902000

2000-2001 2001-2002 2002-2003 2003-2004 2004-2005



5.22 Table showing percentage paid by the bank to the Vijaya cash

certificate holders.

Years Amount

Deposits

% To the Basic

year

% Of Increase

/ Decrease

2000 – 01 10,46,100 100% 0

2001-02 12,36,300 118% 18%

2002-03 14,26,500 136% 36%

2003-04 18,06,900 172% 72%

2004-05 19,02,000 182% 82%

INTERPRETATION:-

From the above table, we can observe that the amount deposits in the


05 that is in the base year 2000-01 the % of deposit is 100%. Then it has

been increased to 11% in the year 2001-02, 136the year 2002-03, 172% the

year 2003-04, 182% the year 2004-05.

We can analyse that the amount deposit i scheme is in increasing

trend, so, we can conclude that this scheme is performing well in attracting

the savings of the people.



5.22 Chart showing percentage paid by the bank to the Vijaya cash

certificate holders.

0%

18%

36%

72%

82%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2000-2001 2001-2002 2002-2003 2003-2004 2004-2005



Various Deposit Schemes of Vijaya Bank:

V stars deposit schemes: It is also called as an innovative deposit

scheme. Savings band account holders who maintain a minimum monthly

balance of Rs 5000/- during the preceding six months are eligible for any

one of the following loans at concessional rates of interest viz at 1.5% lower

than the normal rate applicable to respective scheme subject to a minimum

of the banks primes lending rate.

A term loan equivalent to 4 times the average monthly

minimum balance for the proceeding 6 months subject to

maximum of Rs 50000 for purchase of house hold

articles / consumer durables.

Loan under “U –cash or V- equip schemes subject to

eligibility an the schemes.

Vijayashri Units:

This scheme is devised to meet the needs of diverse investors like

individuals, institutions, professions, executives, entrepreneurs, housewives,

and farmers among others.

Vijayashree units combine the features of a term deposit in terms of

higher interest rates, & the facility for partial withdrawal in units of Rs

1000/-



Vijayashree units are issued for Rs. 1000/- & multiples there of . The

scheme has no maximum limits & interest compounded on a quarterly basis.

If the period of deposit exceeds 3 months.

This is a convenient banking scheme where an authorized

Jeewan Nidhi agent collects the money you wish to deposit at your door

ship.

This scheme promotes savings habits among children, house wives,

professionals, salaried people, shop keepers, small traders & businessmen.

Individuals can choose a deposit period of 12, 39 or 63 months, with a

daily deposit, as low as Rs 1/-

Capital gains accounts scheme:

This is also a one of the scheme of the Vijaya Bank.

Under this scheme an income tax, assesee can avail of the

benefit of exemption from capital gains if the amount of

capital gains or the net consideration is deposited in any

branch [other than the rural branches] on or before the

due dates of their filing return of income.

The income tax assesses who are eligible for exemption

under section 54 , [54B, 54D, 54 F or 54 G] of the

income tax act 1961 may open “Account A” which is in

the form of savings bank account or account B which is

in the form after deposits with an option to the depositors



to keep the deposit as cumulative or non cumulative

deposit.

Depositor desirous of opening an accounts under the

scheme for the first time shall apply in form “A” in

duplicate, obtaining the application from the nearest

branch.

Opening of joint account is not permissible under the

scheme.

Deposits may be made in one lump sum or in stages at

any time on or before the due date of furnishing the

return of income under sub section [1] of section 139 of

ht act

In case of deposit under account “A’ the depositor will be

issued with a pall book where in all amounts of depositor

withdrawals together with interest due shall be entered

under the signature of the authorized officer of the

branch. In the case of deposit under Account “B: a

deposit receipt with principal amount of deposit , date of

deposit , rate of interest, date of maturity of deposit etc.

will be issued to the depositor.

Chaque book facilities are not permitted at {GA –

Account A in view of the system of withdrawal

prescribed under the scheme.

The minimum period of maturity of the deposits in

account “B” is 15 days & maximum is for any number



of years However in the case of these accounts

exemption may be available to the tax payer only if the

capital gains are utilized within a specified period as per

the provisions contained in sections 54, 54B, 54D, 54E &

54 G of income tax Act.

The interest rate to be paid in Account ‘A” [i.e. savings Bank account] under

capital gains A/c scheme, 1988 shall be the same as given for savings &

bank A/c effective from march 01, 2003,. The rate of Applicable for account

“B” [i.e term deposit A/c] under this scheme will be as per the interest rates

commerical by the bank through deposit interest rate from time to time.

[NRF] Resident Foreign Currency:

A person resident in India may open, hold & maintain with &

Authorized dealer in India a resident foreign currency [domestic] Account,

our of foreign exchange acquired in the form of currency notes, bank notes

& travelers cheques.

RFC [Domestic] Account can be maintained for the time being in the

form of non-interest bearing current account only with cheque facility.

Credits to the account: Following credits are allowed in RFC

[domestic] Accounts:

1. Foreign exchange acquired by the account holder from any of

the sources stated below :



While on visit to any place outside India by way of payment

for services not creasing from any business in or anything

done in India.

From any person, not resident in India 7 who is on visit to

India, as honorarium of gift of for services rendered or in

settlement of any lawful obligations.

By way of honorarium or gift while on a visit to any place

outside India.

Represents unspent amount of foreign exchange acquired by

him from an authorized person travel abroad.

As a gift from a close relative: For the purpose of this

clause, “close” “relative” means relatives as define! In

section 6 of the companies Act, 1956.

By way of earnings export of goods services, or as royalty,

honorarium of by any other lawful means

Representing the disinvestment proceeds received by the

resident account holder on conversion of shares held by hi to

ADR’s /GDRs

Debits to the account: The funds in a RFC [Domestic]

amount are free from all restrictions regarding utilization of ht

foreign currency balances including any restriction on

investment out side India. Definition of close relatives [As

defined in the companies Act] two persons shall be deemed to

be relatives if & only if:



They are members of Hindu undivided

Family

They are husband & wife

The one or the spouse of the one is related to

the other or the spouse of the other as parent & child grand

parent & grandchild or brother & sister

The one is related to the other in the manor

indicated in schedule 1-A



CHAPTER-6

FINDING'S CONCLUSIONS AND SUGGESSIONS

Specific Findings:

It is find that savings deposits is increasing from year to year

From this analysis we know that there is a increase in the No. of

persons deposited in this Bank under savings Bank A/c is in

increasing trend.

There is a constant interest rate for the savings deposit holder i.e.

3.5%

From this Analysis we know that there is increase in total interest

amount paid by Bank.

It is find that current deposits is increasing from year to year.

By Analysis we know that their is a increase in the No. of persons

deposited in the current A/c is in increasing trend.

It is find that recurring deposits is increasing from year to year.

By Analysis we know that there is a increase in the No. of persons

deposited in the recurring deposit A/c . But it is countable in nature.

There is a constant interest rate for the recurring deposit A/c holder

i.e. 3.5%

From this Analysis we know that % of interest amount paid by bank

to recurring deposit holder is less.

It is find that fixed deposits is increasing from year to year

From this analysis we know that there is a increase in the No. of

persons deposited in fixed deposit A/c is in increasing trend.



From this analysis we know that there is no interest for the depositor

who are willing to deposit there amount for the very short period i.e.

1 to 4 days

There is a increase in deposits & interest amount paid by bank under

different terms of deposits. [I.e. 1-14 days – Nil, 15-45 4 25% , 46 to

179 days 5%, 180 to 1 year 5.5.%, 1 to 3 year 5.75%, & 3 years &

above 6%]

There is a increasing in interest rate per annum under different terms

of deposits in fixed deposit

It is find that this bank has opened a new scheme i.e. Vijaya cash

certificate to the benefit of children higher education & to build a

house

It is find the deposits in Vijaya cash certification is in increasing from

year to year

From this Analysis we know that the No. Of persons deposited in

Vijaya cash certificate is easy to count.

From this Analysis we can know that there is different interest rate

paid by bank to Vijaya cash certificate holder i.e. under the various

terms of deposits [E.g. If they deposit their amount in Vijaya cash

certificate for 1 to 3 year i.e. 6%]

There is increase in interest amount paid by bank to Vijaya cash

certificate holders

By Analysis we know that there is a scheme for the Non- residential

Indian’s it is helpful to the Indians who are living in foreign country.



There is a scheme for the senior citizens to deposit their savings. The

rate of interest paid by the bank is 7.5%

We know that V star deposit scheme is beneficial to limited depositor.

From this Analysis we know that this bank introduced new scheme

i.e. Vijayashri units to increase the deposits

From this Analysis we know that Vijaya Bank introduced a New

scheme i.e Jeewan nidhi scheme. It is beneficial to children, salary

people business men, shop keeper house wife etc.,

From this Analysis we can know that, Vijaya bank introduced a new

scheme i.e capital gains accounts scheme it is very beneficial to the

depositors. By this they get a benefit of exemption from the income

tax.

There is no interest amount paid by bank to current account holders

but they charge some amount for marinating accounts.

They give loans for the depositors of current A/c holder i.e overdraft

facility with some % of interest charged by the bank

They give loan facility for the fixed deposit holder up to the 80%.

There is a scheme for the salary people who withdraw the amount

before the salary due date.

GENERAL FINDINGS:

The branch is fully computerized so the work is fast and quick

There is a good relationship between customer and bank also there is a

good co-operation between manager and staff

There is a good environment and well arrangement of furniture and

tables



Good locker facilities are available to the customers in order to

provide good service

The formalities and procedures for sanctioning loan are simple and

quick.

Majority of the deposits accepted form the public or invested in

providing loans under housing scheme.

The deposits accepted well utilized and invested in providing loans to

public under various schemes.

The bank is also resulted in controlling illiteracy and helps in the

development economy as whole

The Branch is not offering ATM service to public

The rate of interest paid on deposits is low

The eligibility of for granting of housing loan under the Housing Loan

scheme must be related to certain extent.

This Branch is not giving gold loans and other loans to public

The loan sanction for the education purpose under the education loans

scheme has been increased from the year to year to prompt literacy in

the economy

Specific Suggestions:

In the present competitive world in the Banking sector the deposits

maintained by Vijaya Bank under savings Bank A/c is in increasing

trend. This is a good sign to the Bank, so let the Vijaya Bank

maintain the same.



Even though there is increase in No, of customers deposited in savings

Bank A/c the bank has to further struggle to attract more depositors

through attractive interest rate & facilities.

Vijaya Bank giving constant interest for savings depositors they have

to give flexible interest rate to attract the customer to deposit their

savings.

The total amount paid by the Vijaya bank is a increasing trend. It

should try to reduce the total interest paid. At the same time it should

maintain the increasing trend of the depositors also.

In the present competitive world in the banking sector the depositors

maintained by Vijaya bank under current A/c is in increasing trend,

which is a good sign to the Bank, So let the Vijaya bank maintain the

same.

Depositors under the current account are very low. So the bank has to

increase the depositors under this scheme by giving attractive offers.

In order to increase depositors under current Account, the bank has to

provide little bit of interest to customers based on the slabs of amount

deposited by them

The overdraft facilities provided under current A/c is limited they

have to increase the over draft facilities to attract depositors

Depositors under the recurring deposit account are very low. So the

bank has to increase the depositors under this scheme by giving

attractive offers.



The rate of interest paid under recurring deposit account & savings

Bank A/c is same. The bank has to change this rate of interest to

attract more depositors.

The No. Of persons deposited in recurring deposit A/c is very short it

is countable easily they have to increase this by giving more interest

rates.

The total interest amount paid by the Vijaya Bank is in the increasing

trend. It should try to reduce the total interest paid. At the same time

it should maintain the increasing trend of the depositors also.

Deposits of the fixed deposit A/c is increasing every year although

they have to improve

Interest rate for term of depositor is increased by bank. By this they

can attract more deposits.

In the fixed deposit there is no interest rate for the deposit for the

period from 1-14 days so to improve the deposits they have to give

little interest rate to them, so that they can improve depositors.

Vijaya Bank introduced new scheme i.e Vijaya cash certificate, which

is useful to the public. So the bank has to introduce such type of new

scheme to help the society as well as to attract more depositors.

The No. Of persons deposited in Vijaya cash certificate is very short it

is countable easily they have to increase this by giving more offers.

Vijaya Bank opened scheme for NRI s but it is limited they have to

improve it by giving more interest, then other various schemes.



The interest rate paid for senior citizens is more but the age give to

recognize as a senior citizen is 60 years. The bank has to reduce this

age limit at least 50 years to attract more customers.

The loans provided for V star depositors based on the minimum

balance of Rs5000/- since from 6 months. The bank has to relax this

eligibility to provide benefits to other people also.

Capital gain scheme provided by Vijaya bank helps to reduce the tax

burden. So let the bank maintain the same to attract more depositors

who are having the interest of tax planning.

The loans provided up to 80% of the principle amount deposited in

fixed deposit A/c is a good facility which is provided to depositors let

the bank maintain the same along with reducing the rate of interest on

loan given to the depositors.

General Suggestions:

The bank should offer still mor facility to the customer in order to

mobilize mobile the savings from them for purpose of further

investment in some other scetor to develop the economy

The bank should try to increase rate of interest payable on deposit so

as to attract the customer

The bank should provide ATM facilities to provide saft to customer

The eligibility criteria and amount of loan sanction must relate to

some extent so that every person can make use of such facility.

The Bank should balance properly the cash position in such a way that

there should be neither over capitalization and nor under capitalization



The Bank should trade off correctly between the accept and deposits

and sanction of loan.

Effective efforts should be adopted to collect debt from the public

It should provide more subsidies to public

The bank should decrease the rate of interest on the loan sanction

under different scheme so that each one can utilize the opportunity of

develop further.

Even while sanction the loan bank has to keep in the mind the benefit

of removing regional imbalance to develop economy as a whole . So it

should consider the remote area should make use such laons scheme.

The bank should provide loan to Gold and other Loans to increase the

income of the bank.

It has to provide few more loan to encourage educated unemployed

youths to develop sself employment among then and should help them

to involve in economic development of a country.

It should adopt loan scheme in such a way that the poverty should be

removed. For these purpose lower sections of the society must be kept

in mind.


vijaya bank

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