Prior before the reforms, developments in the banking sector indicated a mixed trend in the performance of banks. Information on reforms in banking sector is important for candidates preparing for various competitive exams. In a series of sharing useful study material for upcoming banking exams. The central bank of nigeria equally articulated a blue print known as the project alpha initiative for reforming the nigerian financial system in general and the banking sector in particular following the 2008 global banking crisis. These challenges and others definitely calls for the reform of the nigerian banking sector. Banking sector reforms free download as powerpoint presentation. Financial sector reforms in india in the early 1990s. The banking sector in india is in a crisis with the increase in burden of bad loans provisioning and the decline in profitability of commercial sector banks particularly public sector banks. Banking reforms in nigeria started in july, 2004 and climaxed in august 2009 and beyond. Considering the opening up of the banking sector as an important ingredient of the countrys economic liberalization, it has become urgent and pertinent for the banking industry in india to prepare itself to stand competition from the giant foreign. The indian financial system in the prereform period i. Similarly, the share of service sector gross domestic product gdp has increased from less than half to 68 percent in 200708 acharya, 2008.
This study investigates the impact of banking sector reforms on bank performance in nigeria drawing specifically from the interest rate deregulation of the. Reforms in the banking sector india bank management. The indira gandhi institute of development research igidr. Banking reforms news latest news on banking reforms. Taking the present financial scenario of the economy into account, the committee recommended that market risk which is defined as the risk of losses with respect to on and offbalance sheet positions arising from movements in market prices, should be. Banking in india is generally fairly mature in terms of supply, product range, and reacheven though reach in rural india still remains a challenge for the private sector and foreign banks in the year 2007. The study will try to list the major reforms of the indian baking sector and to find out the impacts of these reform and the future prospects. The banking sector is laying greater emphasis on providing improved services to their clients and also upgrading their technology infrastructure, in order to enhance the customers overall experience as well as give banks a competitive edge. Union finance minister has released enhanced access and service excellence ease 3. The present banking system is a result of reforms and policy changes that have taken place in the past. European journal of research and reflection in management sciences vol.
Financial sector reform is generally considered good for the economy as it engenders financial innovation and promotes efficiency in the financial system, potentially leading to higher economic growth. We assess the impacts of banking sector reforms on the development of the financial sector and growth of the economy over the period 19702010. Pdf banking sector reforms in india interal res journa. Banking macmillan book pdf free download transformation in retail banking getting ready to face disruptive forces banking sector reform and banking consolidation. It is not enough, however, to change the rules of monetary management. It has been more than 20 years of the start of the economic reform in india and the financial sector reform was one of the important parts of the process. The second part is devoted to the institutional aspects of the reform but banking sector will be analyzed in the paper.
Narasimham committee on banking sector reforms 1998. In case of capital adequacy, strengthening the banking system through an increase in the minimum capital adequacy ratio car from 8 percent to 10 percent by 2002, 100 percent of fixed income portfolio markedtomarket by 2001 up from 70 percent, 5 percent market risk weight for fixed income securities and open foreign exchange positions limits no. T rends in npas both at the bank level and at the sector level are analysed in the penultimate section. In the context of economic liberalisation and growing trend towards globalisation external liberalisation, various banking sector reforms have been introduced in india to improve the operation efficiency and upgrade the health and financial soundness of banks so that indian banks can meet internationally accepted standards of performance. The banking reform act implements the recommendations of the independent commission on banking, set up by the government in 2010. The banking sector reforms were the outcome of the above developments taken place during postnationalization period. Instead, they will harness digital capability to put the customer firmly in control of their destination and preferred model for dealing with their bank and other service providers. The functioning of iba to promote sound and progressive banking principles and practices. Banking sector reforms narsimham committee i narsimham committee ii 3. The narasimham committee on banking sector reforms submitted this report to the government in april 1998. The bank provides solid exposure to the underpenetrated retail sector in egypt, as well as the mediumsized corporations in egypt.
First, as mentioned above, financial sector reforms were undertaken early in the reform cycle, and secondly, the reforms in the financial sector were initiated in a wellstructured, sequenced and phased manner with cautious and proper sequencing. In nigeria, most of the banks had a low capital base, less than 10 million us dollars. As per economic survey 201819, working age population to grow by 9. Banking sector reforms in india your article library. Pre1991, india had nationalized banks in two phases in 1969 and. However, recent global evidence has shown that deregulation of the banking industry can sometimes have the.
A critical overview article pdf available in economic and political weekly 375. The nigerian banking sector has gone through rapid changes over the years. The seminar was conceived in the belief that governments of developing countries in the region are keen on initiating measures to reform their banking sector but have limited technical capacity to design and implement reform measures. Committee on banking sector reforms 1998 1998 finance minister appointed mr. The design of the study was expost facto and desk research. Let us make indepth study of the banking sector reforms undertaken by upa government, 200405. Nnanna 2004 stated that, the banking sector reforms by central bank of nigeria was intended to address issues raised specifically to strengthen the banking system with the vision to make nigeria the financial hub of africa.
Reform measures and the consequent changes in npa norms are discussed in section 3. Indian banking sector reforms in 1991 mba knowledge base. In other words, these two reforms needed another propthe financial sector reformsso that scarce investible funds could be channelised in the productive sectors. Section i current landscape sets the scene and profiles the current bank responses to industry reform as a mixture of the good, the bad and the ugly. Ajayi 2005 opined that nigerian banking reforms are predicated upon the need for reorientation and repositioning of an existing status quo in order to attain an effective and efficient state. Detailed report pwc 2 this part 2 of our report builds on the headline messages and summary content contained in part 1. The test results reveal that all the variables are stationary at their fist difference. Today we are providing banking awareness handwritten notes in pdf format. Impact of banking sector reforms on economic growth in nigeria.
Angola power sector reform support program psrsp purpose of the project. Banking sector reforms in india objectives and goal. The study empirically examined the impact of banking sector reforms on economic growth in nigeria using the annual time series data for forty six years 19702015. The first part is devoted to a brief background financial sector reforms. Also, download the free pdf of list of banking sector acts and reforms. Financial sector reforms and bank performance in ghana. The paper is presenting financial sector reforms in india, identify the emerging issues and explore the prospects for further reform. The major objective of the study was to examine how banking sector reforms impact on economic growth in nigeria. It has been more than 15 years of the start of the economic reform in india and the financial sector reform was one of the important parts of the process. The government aimed to establish a reliable and efficient banking sector so that it could guarantee the safety of the depositors money. Reform in the role of rbi first, the committee recommended that the rbi withdraw from the 91day treasury bills market and that interbank call money and term money markets be. First, we test for the stationary state of our data using the levin, lin and chu t stationary test.
This article provides the list of banking sector reforms and acts passed in india before and after independence. Banking sector reforms and their impact on the economy ppt. Pdf banking sector reforms and bank performance in nigeria. Persistent deterioration in the economic health and looming danger to the banking system called for quick but comprehensive remedial measures. The study will try to list the major reforms of the indian baking sector and. During this period, recognising the evolving needs of the sector, the finance ministry of government of india goi set up various committees with the task of analysing indias banking sector and. An assessment of the impacts of banking sector reforms in. The reform measures have brought about sweeping changes in this critical sector of the indians economy. From the 1991 india economic crisis to its status of third largest economy in the world by 2011, india has grown significantly in terms of economic development. Banking sector reform in nigeria had been introduced in 2004. Financial sector reforms, competition and banking system. Using both descriptive statistics and econometric methods, three sets of hypothesis were tested. Recommendation of narsinham committee on financial sector reform in 1991.