MERGER OF ICICI & ICICI BANK
ROLL NO. 57
Introduction to sector- banking sector
The banking sector plays an important role in the growth and development of an economy. The banks provide funds to various institutions which in finance other sectors of economy. India too relies largely on the banking sector for mobilization of deposits as well as for accelerated growth of deposits. This sector has helped in the development of rural as well as that of backward areas by providing assistance in agriculture industry and international trade. The banking sector in India has evolved over time especially after globalization. The opening up of economy in 1991 paved the way for the next revolution in Indian Banking with the emergence of private banks. This lead to competition and customer satisfaction. The newly formed private banks used technology to grow in turn benefitting the customers and the overall economy of the country. Source- http://www.mbaknol.com/business-finance/organizational-structure-and-role-of-banks-in-india
Introduction to ICICI
The Industrial Credit and Investment Corporation of India or ICICI was established on 5th January, 1955 to assist industrial units in the private sector. It was sponsored by the World Bank, the Government of India and representatives of Indian industry. Vision:
The primary vision of ICICI was to assist industrial units in the private-sector. The main objectives of ICICI are as follows: • To assist in the creation, expansion and modernization at industrial units in the private sector. • To encourage the inflow and participation of foreign capital in the private sector industrial units. • To expand the investment market in India.
• To sponsor and underwrite new issues.
• To provide medium and long-term loans to industrial units in the private sector. • to guarantee loans taken from other private sources. • to furnish managerial, technical and administrative advice to industrial units by the private sector. • To make funds available for reinvestment.
• To advance loans in foreign currency towards the cost of imported capital equipments. • To extend guarantee for deferred payments.
• To purchase the shares and debentures of new companies. Source- http://www.jagranjosh.com/general-knowledge/industrial-credit-and-investment-corporation-of-india-limited-1292058489-1
The initial capital:
ICICI started with an initial capital of 25 crore rupees which grew to 100 crore in at the end of June, 1986. Various sources of financial resources of the Corporation are Indian banks, insurance companies and foreign institutions, including the world Bank, and the public. The government and the IDBI have also provided loans to the Corporation.
The performance of the ICICI in the field of financial assistance provided to the industrial concerns has been satisfactory. Over the years, the assistance sanctioned by ICICI has grown from Rs.14.8 crore in 1961-62 to Rs. 43.0 crore in 1970-71 and Rs. 36229 crore in 2001-02.
• ICICI provided rupee loans, foreign currency loans, guarantees, underwriting of shares and debentures, and direct subscription to shares and debentures. • The assistance was initially focused to private sector which later expanded to public, joint and cooperative sectors. • Chemicals, petrochemicals, heavy engineering and metal product are the main four categories of industries accounted for more than half of the total assistance. • Assistance was also provided to the small scale industries and the projects in backward areas. • In 1977, the ICICI promoted the Housing Development Finance Corporation Ltd. to grant term loans for the construction and purchase of residential houses. • Since 1983, the ICICI has been providing leasing assistance for computerization,...
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