Studies in Money, Finance and Banking (Hardbound - 2005)

Economic growth is positively related to the stage of financial development. Earlier the Indian financial system suffered from ‘financial repression’. Post-1991, the liberalisation process attempted to make credit institutions organisationally strong, financially viable and operationally efficient by well-sequenced reforms. These reforms led to a heightened consciousness of ownership and capital structure, enhanced competition, increased autonomy, technological upgradation and performance change. Achievement of competitive advantage requires continued accent on efficiency, productivity, profitability and technological automation.

The major challenge for public sector banks (PSBs) relates to networking and providing core-banking solutions. Restructuring branches, downsizing manpower, reducing operational risk and transactions cost by progressively greater use of the convergence of information and communication technology (ICT), containing accretions to NPAs and optimising efficiency have also emerged as key policy variables impacting the working of the winning formula.

The New Capital Accord, which is based on a Three Pillars approach of minimum capital requirements, supervisory review process and market discipline, requires tectonic changes. Some of the key drivers of Basel II relate to technological advances leading to emergence of new financial products and new ways of delivering them, progressively larger deregulation, demographic changes and the nexus of increased competition, enhanced search for shareholder value and spread of financial safety nets. These forces and their interactions have been reflected in securitisation, globalisation and consolidation in the financial services industry. But Basel II Accord is an evolving process to handle financial innovation and increasing cross-border flows triggered by rapid technological advancements. Systemic reform of the banking system necessitates streamlined risk management, adequate capital provision, sound supervisory and regulatory practices, transparency and macroeconomic stability.

The book would be useful to a wide cross-section of the reading public, including scholars and academics, government executives, international institutions, business communities and planners, bankers and policymakers.

Manoranjan Sharma is the Chief Economist of Canara Bank, the premier bank of the country in terms of almost all parameters. Shri Sharma has a brilliant multi-disciplinary background, viz. a First Class First Master’s degree in Economics and a First Class Postgraduate Diploma in Business Management (equivalent to MBA). With extensive experience in managing policy and strategic processes, he has incisively analysed different facets of the macro-economy and has proven track record in economic policy research. This is clearly reflected in about 150 works, spanning over a period of twenty years, published in leading national and international journals, books, economic newspapers, etc.

Of the over 15 lakh persons working in India’s banking and financial sector, Shri Sharma is the only professional, whose papers, on the basis of a rigorous “double-blind review”, have been repeatedly accepted for important national and international conferences. These include Global Finance Conference—Las Vegas, USA (April 2004); Conference on Emerging Issues in Business and Technology—Western Illinois University, USA (October 2004); Applied Business Research Conference—Walt Disney World, Florida, USA (January 2005); 4th International Symposium Economy & Business 2005, Bulgaria (September 2005); International Applied Business Research Conference in Puerto Vallarta, Mexico (March 2005); Global Business and Economic Research Conference—Istanbul, Turkey (August 2005); Conference on Money and Finance—Indira Gandhi Institute of Development Research (IGIDR), Mumbai; International Symposium on Development Policies and Options for the Next Millennium—IGIDR, Mumbai; Foundation Day National Seminars—National Institute of Rural Development (NIRD), Hyderabad, etc. The high-powered Expert Committee on Rural Credit set up by NABARD relied on many of his ideas for formulation of its views and the Bankers Institute of Rural Development (BIRD), Lucknow identified him as an expert to review Research Project of the Swiss Agency for International Cooperation (SDC).