2. INTRODUCTION
• Public Sector Banks (PSBs) are banks where a majority stake (more than 50%) is held by
a government. The shares of these banks are listed on stock exchanges. There are a total
of 21 PSBs in India.
• The Central Government entered the banking business with the nationalization of the
Imperial Bank Of India in 1955.
• A 60% stake was taken by the Reserve Bank of India and the new bank was named as
the State Bank of India. The next major nationalisation of banks took place in 1969
nationalisation of an additional 14 major banks.
• The total deposits in the banks nationalised in 1969 amounted to 50 crores. This move
increased the presence of nationalised banks in India, with 84% of the total branches
coming under government control.
• The next round of nationalisation took place in April 1980. The government nationalised six
banks. The total deposits of these banks amounted to around 200 crores. This move led to
a further increase in the number of branches in the market, increasing to 91% of the total
branch network of the country. The objectives behind nationalisation were.
3. EMERGENCE OF PUBLIC
SECTOR BANKS
The Central Government entered the banking business with the nationalization of the
Imperial Bank of India in 1955.
A 60% stake was taken by the RBI and the new bank was named as the State Bank of India.
The seven other state banks became the subsidiaries of the new bank when nationalised on
19 July 1960.
The next major nationalisation of banks took place in 1969 when nationalised an additional
14 major banks. The next round of nationalisation took place in April 1980. The government
nationalised 6 banks.
The objectives behind nationalisation were:
• To break the ownership and control of banks by a few business families,
• To prevent the concentration of wealth and economic power,
• To mobilize savings from masses from all parts of the country,
• To cater to the needs of the priority sectors
4. STATE BANK OF INDIA
State Bank of India (SBI) is an Indian
multinational, public sector banking
and financial services company.
On 1st April, 2017, State Bank of India,
which is India's largest Bank merged with
five of its Associate Banks.
State Bank of India will enter the league of
top 50 global banks with a balance sheet
size of ₹33 trillion, 278,000 employees, 420
million customers, and more than 24,000
branches and 59,000 ATMs.
SBI's market share will increase to 22
percent from 17 per cent.
5. PRODUCTS OF SBI
Business Loan
Car Loan
Credit Card
Debit Card
Education Loan
Fixed Deposit
Gold Loan
Home Loan
Loan Against Property
Personal Loan
Savings Account
6. PUNJAB NATIONAL BANK
Punjab National Bank is an Indian multinational banking and financial services company. It
is a state-owned corporation based in New Delhi, India. Founded in 1894, the bank has
over 6,968 branches and over 9,935 ATMs across 764 cities. It serves over 80 million
customers. Shri Sunil Mehta is the Managing Director and CEO of the bank.
PNB has made official debut on the social networking sites i.e., Twitter and LinkedIn, with
an aim of strengthening “Brand PNB” on social media and to engage with customers in a
cost efficient manner and Mr. Virat Kohli has been chosen as brand ambassador of the
Bank because of his mass appeal to the youth of the country.
Development of Mobile based banking application, called Unified Payment Interface (UPI),
launch of PNB wallet named “PNB Kitty” that serves as a virtual account that holds money
online for e-payments and to enable RuPay EMV debit cards are certain steps taken by the
bank towards digital banking.
Some of the renowned divisions on which the major functionalities of the PNB are based
are Corporate Banking, Personal Banking, Industrial finance services, Agriculture finance
services, International banking services and Trade financial services.
7. It also maintains commercial affiliation with more than nearly 200 prestigious, global banks
around the globe. The bank offers provision of Rupee drawing procedures with almost
fifteen exchange companies based in the UAE, and another in Singapore.
PNB provides many tailored solutions namely Savings Fund Account, Current account, Fixed
Deposit scheme, Loan services to entertain all types of financial requests of the consumers.
PNB is one of the most popular bank names when it comes to home loan benefits, and it is
known for offering both short and long term loan facilities.
Business Performance of the bank:
Parameter Mar`15 Mar`16 Mar`17 YoY Gr.%
(Mar’17 over
Mar’16)
Deposits 501379 553051 621704 12.41
Advances 380534 412326 419493 1.74
Total Business 881913 965377 1041197 7.85
CASA Deposits 183780 205583 260016 26.5
CASA Share to Domestic Dep. (%) 40.57 41.63 45.97 -
Operating Profit 11955 11339 14565 28.5
Net Profit 3062 -3974 1325 -
8. OBJECTIVES OF THE STUDY
To study the satisfaction level of customers of public sector banks.
To show the emergence of Public Sector banks.
To discuss the reasons “Why one should choose Public Sector banks?”
To analyse the advantages one can get in case of loans offered by Public Sector
banks.
9. WHY SHOULD ONE CHOOSE
PUBLIC SECTOR BANKS?
They are safe and people who are keeping money in fixed deposit and saving account
do not have to worry.
Less hidden charges and also lower limit of amount to be held as minimum deposit as
far as in saving account. so for example in case of private banks minimum balance to
be maintained is anywhere between 5000 to 20000 rupees whereas in case of public
sector banks it is 1000 rupees and in case of student account and no frill accounts it is
0.
10. WHO GIVES THE BEST DEAL IN
LOANS: PSU OR PRIVATE BANKS
1. Processing charges : Processing charges on loans are cheaper in the case of
government banks. State Bank of India (SBI) is charging a home loan processing
fee of 0.25 per cent on loans upto Rs 25 lakhs. Home loan processing fee at private
sector banks can be as high as 1 per cent.
2. Interest rates fluctuation: They keep same policies for all loan customers and
decreased rate is effective for existing customers also almost immediately.
3. Prepayment Period: They do NOT have any such clause. You can start pre-
paying from day 2 of loan itself.
4. Prepayment charges: Public sector banks do NOT charge you a penny to
prepay.
5. Pre-payment Amount: Again, no such clause here. You can pre-pay any amount
which you like.
11. CONCLUSION
As a customer, you should try to buy a product whose cost is as low as possible in
both short and long term. So, make a wise decision considering the above facts.
There are lots of charges involved in a loan which are incurred at the beginning and
over a period of time. Smaller tenure loans do not hurt much but for home loans, where
the tenure is generally 20 years, you should take great care for the above mentioned
points.
For example, if you really want to close the loan much earlier than the actual loan
tenure by making pre-payment occasionally, you should keep the pre-payment
charges, period and amount in mind.
