This article will be principally dealing with the basic understanding about the banking sector, specifically in India and all the aspects and components of the size of the market. According to the Reserve Bank of India, the banking sector in India is believed to be sufficiently capitalized and well regulated. Recent reports state that the financial and economic conditions in our country, are way better in comparison to the other countries, in the present times. This basically puts the Indian economy, which is considerably stable, against the other alarmingly unstable and equally dysfunctional economies, all over the globe. Studies conducted in various fields like Credit, market and liquidity risk conclude that the banks in India have shown a general tendency, of being resilient and have been able to withstand the global economic turmoil really well.
This may have been a result of the various innovative banking models, for instance, the payments and small finance banks, which have had a positive impact on the Indian banking industry in the recent times. In the financial year of 2015-2016, about 10 small finance banks and around 11 payment banks, have received the principle approval from the central bank. This is a part of the new measures put in place by the Reserve Bank of India, which show great signs of going a long way, in terms of helping in the restructuring of the domestic banking industry. Let’s talk facts and numbers now, in keeping with the same we need to focus on the numeric aspects of the banking units across the country.
Primarily, the Indian banking system is made up of around 26 public sector banks, 25 private sector banks, 43 foreign banks, 56 regional rural banks, 1589 urban cooperative banks and around 93550 rural cooperative banks, in addition to the existing cooperative credit institutions. 80% of the entire market, is supposedly controlled by the public sector banks, thereby evidently a very small share of the market is left in control of the private counterparts. While on the other hand, every bank out there has begun to encourage their customers, in order to manage all of their finances using mobiles phones.
While there have been a number of predictions and assumptions in terms of credit growth, especially with the current banking situation, as well as the Union Budget almost being right around the corner. There are various estimates made, among which the Standard and Poor, have gone on to make the estimates, that the credit growth in the Indian banking sector, is likely to improve to 11-13 per cent in this financial year, that is 2017. This is a great news in terms of growth and progress, from the past three years, when the second half of the year, 2014, showed less than 10 per cent credit growth. As the future prospects of the Indian banking sector seem extremely bright and by extension, so do the job prospects in terms of Corporate Finance, Investment Banking and so on. This is why many finance enthusiasts have begun to turn to professional training institutes like, Imarticus Learning, that help them achieve the perfect career roles.
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The Benefits of a CISI Certification with Imarticus Learning
The Chartered Institute for Securities and Investments is considered to be the leading professional body, globally, for securities, investment, wealth and financial planning professionals. Founded in the year 1992 by the London Stock Exchange, today, it has taken up the role of a global community, spanning around 116 countries and boasting of about 40,000 members. It was conferred the title of ‘Chartered Institute of Securities and Investment’ in the year 2009 when it was granted a Royal Charter. Headquartered in London, this global professional body has its offices spread over various countries, including Sri Lanka, India, Singapore, Dubai, and Dublin.
This professional body is known to offer close to 40,000 CISI qualifications every year in around 70 countries, to qualify for which candidates have to take the Computer Based Test in the various centres worldwide. Apart from this, it is also the chief examining body in the industry and thereby, offers a number of industry memberships and training to the qualifying candidates. Apart from offering qualifications, the CISI is also known to offer, the CPD scheme, also known as, Continuing Professional Development scheme, which is basically rewarded to the members of, every level of seniority, geographical location, as well as industry specialization. The institute is known to have certain charitable objectives, which are as follows;
“To promote, for the public benefit, the advancement and dissemination of knowledge in the field of securities and investments to develop high ethical standards for practitioners in securities and investments and to promote such standards in the UK and overseas to act as an authoritative body for the purpose of consultation and research in matters of education or public interest concerning investment in securities.”
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Being a member of this prestigious organization, sends out a message to all your clients and colleagues, including the wider public, that you as a professional, are committed to professionalism, integrity, and excellence. Becoming a CISI endorsed member is the most beneficial in terms of networking for a professional. One can easily access the international network of 40,000 financial practitioners.
Apart from this, the CISI body organizes a number of formal mixers, like forums, events, and other social media activities, which involve and encourage their members to build an array of networks and connections, with similar professionals from across the country. Any professional who is affiliated by the designations of CISI can meet up and keep abreast with the current happenings in the financial markets, while at the same time can also discuss them, with the top level delegates from across the world at any given point. The CISI body also offers a number of training courses apart from its social events and conferences. In order to get an entry into this elite bunch of people, one has to acquire the much coveted CISI certification.
International Certification & Placement You will receive the industry endorsed Certified Investment Banking Operations Professional (CIBOP) certification and the optional CISI certified IOC (Investment Operations Certificate). The Imarticus Learning Career Services and Placements team provides you guidance and assistance throughout the program, giving you the best career opportunities in leading international firms.
Introduction to Investment Management
What is Investment Management? What does the investment management industry constitute?
The world of finance can be complicated. To simplify for the sake of understanding, let us consider the financial world as broadly constituting of banks – (retail, commercial, and investment), insurance companies, and investment managers.
Banking: Retail and commercial banks are the ones most people are familiar with and are mostly straightforward. They take in money through deposits from customers, other banks, and shareholders. They then distribute this money through credit cards and loans to individuals, companies, and other banks.
Retail and commercial banks make money on the interest charged on these loans. Investment banks on the other hand are more complicated. They allow their clients, which include investment managers, to trade on the financial markets. They also deal with IPO, mergers, and acquisitions.
Insurance: Insurance companies take in money by charging for private and corporate insurance policies, in return for against the unexpected. They in turn are protected from being unable to payout on policy claims by moving money to a reinsurance company and therefore reducing exposure.
Investment Management: Investment managers also known as fund or asset managers do as the name suggests – they manage investments of private investors, corporates, banks, or insurance companies. Investment managers make their clients’ money grow by using investment banks to buy and sell investments.
Let us consider the funds managed by an investment manager as raw material whether in shares, bonds, commodities, or derivatives, and an investment manager as a machine that converts this raw material into a product by using a series of processes. The product is a fund. The goal of the fund is to make money for the investors. Thus, an investment manager uses an investor’s money to make money.
These processes vary greatly and depend on the investment strategy used. E.g.: passive vs. active investment. However, the principle remains the same. The fund aims to make a return by balancing risk and rewards and thus, in a process-driven manner ensures effective mobilization/channeling of its resource i.e. money from investors.
Thus, the players in the investment management industry can be classified into just two broad categories – the investment managers and the investors. Investment occurs directly i.e. investment contracts or more commonly via collective investment schemes. A mutual fund is a type of collective investment scheme. They provide an efficient way of pooling funds for investment purposes.
The Flow of funds in the asset management industry:
*PMS – Portfolio Management Services, AMC – Asset Management Services, WM – Wealth Managers.
What is the Investment Process? What role does the investment manager play? What is the role of portfolio performance measurement in the investment process?
Like any process, the investment process can be broadly classified based on four phases – Plan, Do, Check and Act. Similarly, it is pertinent to note that the investment management process, forming a part of the investment process cannot be improved without performance measurement. The following is an overview of the Investment Process.
From the above, it is clear that for the investment process to be complete it needs to be measured. This measuring of the portfolio performance should preferably be a part of the investment management process itself. In this case, it will contribute to improving the portfolio management process internally and thus contribute to process improvement. On the other hand, performance measurement can be undertaken by the investor as a part of the larger investment process. In this case, the same measures behave as a stricter audit function rather than a must-suited process improvement role.