12
                                                                                                     12.1
                                                          C h a p t e r an in            in ndia
                                                                           Banking
                                                                             in india
                       Banks are perhaps the most important financial intermediary. In the nineteenth
                   century, banks mainly lent money to firms to help finance their inventories – which
                   were held as collateral—in the cases of defaulters banks seized them. Gradually,
                   banks expanded their lending activities —to finance houses and commercial real
                   estates – holding the buildings as collateral. Emergence of information technology
                   has presented special problems to these traditional forms of finance—if the idea
                   does not pan out, the firm may go bankrupt, but there is no collateral— there is
                       little of value that the creditor can seize.*
     In This Chapter...
     ‰ Introduction                                        ‰ Nationalisation and Development of Banking in
     ‰ NBFCs                                                  India
     ‰ Reserve Bank of India                               ‰ Regional Rural Banks (RRBs)
     ‰ Credit and Monetary Policy                          ‰ Coperative Banks
     ‰ Base Rate                                           ‰ Financial Sector Reforms
     ‰ MCLR                                                ‰ Banking Sector Reforms
     ‰ Revised LMF                                         ‰ NPAs and Stressed Assets
                                                           ‰ Public Sector Asset Rehabilitation Agency (Para)
       ee oseph E. g it an Car E. Wa sh, Economics,                        ,     ,