JAIIB NOV 01/2006 WELCOME TO VIRTUAL CLASS ROOM SESSSIONS

RESERVE BANK OF INDIA  SUPERVISORY & REGLATORY  ISSUANCE OF CURRENCY NOTES  CREDIT CONTROL  EXCHANGE CONTROL  TRANSFER OF FUNDS

BANKER-CUSTOMER RELATIONSHIP DEBTOR-CREDITORDEBTOR-CREDITOR CREDITOR-DEBTORCREDITOR-DEBTOR AGENT-PRINCIPALAGENT-PRINCIPAL LESSOR-LESSEELESSOR-LESSEE BAILEE-BAILORBAILEE-BAILOR

Garnishee Order A garnishee order is issued by a court A garnishee order is issued by a court Ex: Rajesh borrows money from Bala Ex: Rajesh borrows money from Bala and fails to repay. Bala files a suit under and fails to repay. Bala files a suit under Civil Procedure Code and the Court issues Civil Procedure Code and the Court issues a decree and attaches the funds in Rajesh’s bank account with bank A. a decree and attaches the funds in Rajesh’s bank account with bank A. The order issued by the Court on bank A The order issued by the Court on bank A is called “Garnishee Order” is called “Garnishee Order” Rajesh is the judgement creditor Rajesh is the judgement creditor Bala is the Judgement debtor. Bank A is Bala is the Judgement debtor. Bank A is Judgement debtor’s debtor Judgement debtor’s debtor

BANKER’S DUTIES & RESPONSIBILITIES PAYING BANKER PAYMENT OF CHEQUES PAYMENT IN DUE COURSE APPARENT TENOR PAYMENT IN GOOD FAITH WITHOUT NEGLIGENCE NEGOTIABLE INSTRUMENTS

CHEQUES BEARER ORDER CROSSED OPEN

NEGOTIABLE INSTRUMENTS  BANKER’S DUTIES & RESPONSIBILITIES  C0LLECTING BANKER  COLLECTION OF  CHEQUES HOLDER IN DUE COURSE CONSIDERATION TITLE IBEFORE MATURITY

WORKING CAPITAL OPERATING CYCLE RAW MATERIAL SEMI FINISHED PRODUCTS FINISHED PRODUCTS CREDIT SALES BILLS PAYABLE BILLS REALISED CASH

DEPOSIT ACCOUNTS DEPOSITS CURRENTSAVINGSFIXEDRECURRINGFLEXICERTIFICATE

CERTIFICATE OF DEPOSIT CD IS A MONEY MARKET INSTRUMENT CD IS A MONEY MARKET INSTRUMENT ISSUED AS A DISCOUNT INSTRUMENT ISSUED AS A DISCOUNT INSTRUMENT MINIMUM AMOUNT IS Rs. One LAKH MINIMUM AMOUNT IS Rs. One LAKH MINIMUM PERIOD OF CD 15 DAYS MINIMUM PERIOD OF CD 15 DAYS MAXIMUM PERIOD OF 1 YEAR MAXIMUM PERIOD OF 1 YEAR DIFFERS FROM FD DIFFERS FROM FD a) Prepayment not allowed a) Prepayment not allowed b) Loan is not allowed b) Loan is not allowed

CHARGES HYPOTHECATIONHYPOTHECATION PLEDGEPLEDGE MORTGAGEMORTGAGE ASSIGNMENTASSIGNMENT LIENLIEN SET OFFSET OFF

FUND BASED FINANCE LOANS & ADVANCES CASH CREDIT OVERDRAFT RETAIL FINANCE TERM FINANCE BILLS FINANCE

Non-Fund Based Finance BANK GUARANTEE CO- ACCEPTANCE OF BILLS LETTERS OF CREDIT

CAMELS - MODEL CAMELS - MODEL Capital AdequacyCapital Adequacy Asset QualityAsset Quality ManagementManagement EarningsEarnings LiquidityLiquidity Systems & ControlSystems & Control

Non-Resident Indian Accounts  Who is a Non Resident Indian? 1)An Indian citizen who resides outside India on account of  a) Employment/business/vocation and  b) staying outside India for an uncertain period 2)A person of Indian origin but a citizen in any other country except Pakistan/Bangladesh if at any time holding an Indian passport

6 Cs CHARACTER CHARACTER CAPTIAL CAPTIAL CAPACITY CAPACITY COLLATERAL COLLATERAL CONDITION CONDITION COMPLIANCE COMPLIANCE

Clayton’s Case  Applicable only to a  a) joint a/c and or a partnership a/c  b) running c/c and o/d a/cs  c) Not to two different a/cs (Right of set off is applicable) Based on the concept of Appropriation

ALL THE BEST & THANK YOU  T.M.C.VARADARAJAN  TEL : (R)  (O)  e.mail: 