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Career in Banking


About Banking


Bankingemand for taking up a career in banking, among young aspirants is rising than ever before!


For a developing country like India, banks are considered as the backbone of the country's economy. The global turmoil in the financial segment that occurred a few years ago had the least effect on our country's banking sector because of our sound banking and financial system. The banking sector in India is growing at a rapid rate and is among one of the fastest growing industry vertical.The rapid advancements and growth in the banking sector has paved way for many banking career opportunities. The banking sector in India is gearing itself and there are much more private banks to come in the near future. All of these bring in huge career opportunities for those who aspire to become future bankers.


Why Opt for a Banking Career?

Bankjobs are backed up by a huge wealth of diversity and almost every vacancy created in a bank incorporates some sort of banking element such as law, accounting, investment banking, taxes, public relations, customer relationship management etc. Moreover a career in banking is international in nature and a number of international and private banks set up in the country have opened up opportunities for the deserving candidates.

For beginners, the banking sector provides an excellent opportunity to develop an understanding of the global economy. It paves the way for identifying various challenges in the marketplace and provides tremendous opportunities globally.


Types of Banks in India

The banks in India can be categorized as following.


*Commercial Banks: The major role of the commercial banks is to enable businesses and entrepreneurs with the financial services. Commercial banks are further categorized into the following.

1. Private Sector Banks

2. Public Sector Banks

3. Regional Banks


*Co-operative Banks: Co-operative banks mostly benefit the rural people like farmers, small scale industries etc. These are controlled and managed by the co-operative societies. These can be further categorized into

1. State co-operative Banks

2. Central co-operative Banks

3. Primary Agriculture Credit societies


*Investment Banks and specialized banks: These provide financial assistance to its customers and provide necessary support like foreign exchange, sales of equities, foreign trading etc. to its customers.

Most of these banks offer better packages today and give a performance and experience based promotion. In case of public sector banks, professionals like engineers, doctors, MBAs and lawyers are appointed based on the results in All India Recruitment Exam. Probationary officers (Bank PO) are also recruited in public sector banks based on the Common Written Examination (CWE) conducted by the IBPS. It is estimated that public sector banks are to employ more than 7 lakh people in the near future.


Skills required for a Banking career

  • Customer Dealing

  • People with patience

  • People good with numbers and accounting

  • Good Analytical Skills

Preparing for a Career in Banking

There are various positions available in banking sector out of which the two major ones are clerks and probationary officers (P.O.)/ management trainees (M.T.)


Recruitment of clerks in banks Age limit: 18 years to 28 years Educational qualification: 60% aggregate marks in 12th The qualifying examination is in the form of written examination and it involves multiple choice questions. It consists of a test of reasoning ability and numerical aptitude, test of clerical aptitude, test of English language and test of general awareness The candidates will be selected based on the final merit list and this is jotted down based on the aggregate of marks in written examination and interview.


Recruitment in Officer Cadre

Mostly officer cadre is filled after promotions in clerk positions and at times to meet the rising demands direct recruitment are also done. The minimum age group for entry into officer cadre is 21 years and maximum is 26 years or above as decided by the individual banks. Educational qualification of 55% marks is required in any graduate program from a UGC recognized university. The qualifying test for probationary officers includes data interpretation and logical reasoning, general awareness, English and verbal reasoning.


Other Career Options in Banking Sector

Other opportunities available in banking sector are financial managers, Bill and account collectors, bank tellers, loan officers, financial service representatives, book keeping and audit clerks.


What do they do

The banking system in India works according to the guidelines issued by the RBI. ... Every bank should deposit a certain amount in the RBI. The commercial banks have the power to borrow the money from the RBI when they are in need of India.


Requirements


About Bank PO

A PO or a Probationary Officer is basically an Assistant Manager of Scale I in a bank. He is a Junior Manager of Grade I scale and hence called Scale I Officer. After the selection criteria is completed, a Probationary Officer has to go through an intensive training program at Institute of Banking Management where they are trained. The probation period of a PO may last for 2 years. This again differs from bank to bank.


Role of a Bank PO

As the candidates selected for this post are young officers who have freshly graduated, they have a great enthusiasm within themselves. They are hardworking and have a zest to learn and hence they are imparted with some really serious responsibilities by the bank.

A PO is trained on multiple verticals such as finance, accounting, billing, investment etc. during his/ her probation period in order to acquaint them with various working procedures of the bank. This is basically done by entrusting them with responsibilities and jobs in these categories.

The main purpose of the bank is to provide optimal service to its customers. A PO has to make sure that the business of the bank keeps on increasing by tending to the banks’ customers properly by handling customer complaints, addressing various customer related issues such as discrepancies in accounts, rectification of undue charges etc.

When they get acclimatized to the banks’ norms they are provided with more serious responsibilities such as planning, budgeting, loan processing, investment management etc.


Bank PO Exam

Every year all the government as well as the private banks conduct Bank PO exams to recruit young officers. The major banks participating in this process are listed below:

  • State Bank of India

  • Allahabad Bank

  • Bank of Baroda

  • Bank of Maharashtra

  • Punjab National bank

  • Oriental Bank of Commerce

  • ICICI Bank

  • Cooperative Bank

  • Cooperation Bank

  • Syndicate Bank

  • HDFC Bank

Bank PO Full Form

The full form of Bank PO is Bank Probationary Officer. It is a managerial level post offered in various Public Sector Banks in India and holds the designation of Assistant Manager in any Public Sector Bank.

The main exam among them is the SBIPO exam and the IBPSPO exam. Both of them have a large number of vacancies and eagerly look for young officers. The main thing to keep in mind is that every bank has their own selection criteria and their own set of papers. IBPS Conducts a common written exam for hiring of Probationary Officers (PO) in different public sector banks(PSU) and State Bank of India conduct a separate exam for hiring of Probationary Officers (PO).


List of preferable institution

The banking industry is one of the most important sectors of the Indian economy. With the rapid growth and evolution of the products and services offered by banks and an increasing requirement for financial inclusion in our country, there is a huge demand for professionals with specialized knowledge and skills. These include areas like Commercial Banking, Credit Management, Trade Finance, and Investment Banking. Even Insurance as an industry is gaining importance in India. Over FY02–FY16, life insurance premiums expanded at a CAGR of 7.5 %, which means this sector is poised for further growth and there are going to add more jobs in future.

Let’s look at some of Post Graduate Diploma courses which are a gateway to the career in banking, finance and insurance. This is an indicative list which has been formed by analysing Google Trends, availability of jobs on leading portals and overall popularity amongst aspirants. As per a leading job portal, currently, there are around 13,000 jobs available in the Banking and Insurance sector in India.


1. PGDM Banking and Finance (NIBM)

Established by the Reserve Bank of India and backed by the Government of India, National Institute of Bank Management (NIBM) offers prestigious courses in Banking, Economics and Finance. Post Graduate Diploma in Management (Banking & Financial Services) is its flagship program aimed at producing quality professionals in the Indian banking sector. The curriculum spreads over a vast range of topics pertaining to the management of banks and financial institutions, which includes Asset liability management, risk management, treasury and forex management. Learning Provider: NIBM, Pune, Duration: Around 2 years; Mode: Full Time


2. NSE PGP in Investment Banking and Capital Markets

Investment Banking has been a dream job for finance professionals since long. The 10 months full time/ part time Post Graduate Program in Investment Banking and Capital Markets (PGP IB & CM) by NSE Academy has been designed to sculpt students as a hard core finance professional armed with expertise in Investment Banking and Capital Markets. The program has an exhaustive curriculum that covers the nuances of Investment Banking, Equity Research, Credit Analysis, Financial Analysis, Project Finance, Capital Markets, IPO Analysis etc. Learning Provider: NSE Academy, Duration: 10 months; Mode: Full time/ Part Time


3. BSE Banking and Finance

The Post Graduate Program in Banking & Finance (PGPBF) offered by the BSE Institute includes all round knowledge of banking operations including FOREX markets, international trade and finance, bank credit, legal environment of banking and IT systems in banking. The program aims at preparing the participants for managerial jobs at Probationary Officer/ Management Trainee/ Executive Trainee levels. Learning Provider: BSE Institute; Duration: 1 year; Mode: Full Time


4. Actuarial Science

Technically, an “Actuary” refers to a person skilled in risk analysis in different areas of insurance. Their responsibilities in life and general insurance business include designing and pricing of policies, deciding premium to be charged, ensuring the sufficiency of the funds to provide the assured benefits etc. The demand for actuaries is strong overseas and it is gradually growing in India too. Leading insurance companies like MAX BUPA, Allianz, Future Generali etc. employ actuaries. To become an actuary, one need to pass all 15 actuarial exams conducted by the Institute of Actuaries in India (IAI) and have 3 years of practical work experience. Learning Provider: Institute of Actuaries in India, Ivy Professional School, Inflexion Point; Duration: Around 2 years; Mode: Distance Learning


Skills


1. Analytical Skills

Regardless of which sector you are working in and the nature of your role, it’s a simple truth that you won’t advance very far in banking and finance unless you possess the analyticalskills necessary to identify trends, patterns and definitive conclusions from the reams of data you’ll have exposure to.

This doesn’t just mean being savvywithExcelsoftware or proficientinPython, either – although these are technical skills that will definitely come in handy. You need to know what exactly you are looking for in the data, as well as how it can be used to gain a competitive edge.


2. Commercial Awareness

The ability to anticipate financial trends and future business developments across the globe is often what separates a successful banker from a failed one. After all, identifying where market changes are going to occur could be vital for either expanding or protecting a particular area of your bank’s portfolio.

In the corporate world, it’s also necessary to understand how businesses operate and what drives them, particularly if you are working directly with them. If you are working with a client in a particular industry, for instance, then you need to know everything about the climate, risks and potential change factors of that industry.


3. Attention to Detail

A keeneyefordetail is another requisite for banking, whether it’s noticing particular trends or activities that nobody else has or you are producing complex financial reports for senior management.

Indeed, many financepositions involve the ability to spot anomalies or, perhaps more importantly, simple mistakes. Not noticing an extra zero or two is easily done, after all, but it’s unlikely that your bosses will be too pleased if it results in an unintended$35billiontransaction.


4. Determination

As previously mentioned, corporate banking is an extremely ruthless and competitive environment, where you’ll have to overcome any number of obstacles on your journey from wide-eyedintern to seasoned account manager.

As a result, you’ll need to be fiercely determined to succeed, even if it means working inscrutable hours and making sacrifices in your personal life. Of course, for those who make it, the financial rewards are almost unimaginable, but it won’t be an easy ride to get there.


5. Work Ethic

In a similar vein, investment banking is not for the lazy or the unmotivated. The hours will be long and punishing and, despite concerns over the lack of work-lifebalance in the industry (including brutal 100+ hour work weeks), there seems to be littledesire from within the banks themselves to eradicate this extreme culture.

Therefore, especially in the first five years, you should be prepared to push yourself to your limits in order to survive. If you don’t possess a relentlessworkethic as a basic minimum, then you should probably consider another career.


6. Confidence

The general perception of bankers isn’t a positive one, punctuated as it is by the image of brash, loud-mouthed and arrogant young males driven only by greed and excess. And while this isn’t necessarily a fair reflection of the full reality, it’s undeniable that to stay above water in such an environment, you need to beconfident.

This doesn’t necessarily mean that you need to play the stereotype, but – in such a cut-throat environment – it does mean that you should have an unwavering self-confidence in your own ability.


7. Technical Skills

As with most industries in the digital age, the large majority of the decisions you make will be based on data analysis. Therefore, in order to access and process that data, to communicate with other stakeholders, to find information and to perform pretty much every other task that will be required of you in a normal working day, you’ll need to be tech-savvy.

Bankers work with a lot of specialised software, so take every opportunity you can during internships or placements to get to grips with as much of it as you can. In your spare time, learn everything you possibly can about Excel, too – particularly model building.


8. Stress Management

Given the long working hours, extremely high-pressure environment and the huge weight of expectation on you to perform, it’s little surprise that banking is considered a highlystressfulrole. In order to be successful in it, you need to have a high tolerance for stress and be able to manage yourself accordingly.

This isn’t optional, either. Many bankers suffer from stress-relatedhealthproblems and burnout and, in the most extreme cases, turn to suicide. If you’re easily troubled by trivial matters, then banking likely isn’t for you.


9. Communication Skills

As with any job, communicationisakeyskillintheworkplace, and banking is no different. Whether it’s explaining complex financial concepts or procedures to non-financial clients, writing and compiling in-depth reports or learning to communicate in a professional manner at management level, how you interact with others will have a big bearing on the success of your career.

Before you get into banking, you should ensure that your communicationskillsare up to scratch and that you can convey – and take on board – instructions clearly and confidently.


10. Resilience

It’s a common mantra in corporate banking and finance that the first five years are the worst, but that once you’ve proved yourself, you can begin to reap the riches and rewards. Therefore, given all the negative factors previously discussed – the hours, the expectations, the competitiveness (and, oh, did we mention the hours?) – you’re going to need to beresilient to reach that point.

Staying the course and reacting positively to everything thrown at you is a sure-fire sign that you have what it takes to reach the top, so grit your teeth, dig in and be prepared to show everybody that you’re strong enough to thrive.

As you can see, life as an investment banker isn’t for everybody. Sure, the financial rewards are a pretty enticing carrot, but bankers have to sacrifice and give a lot in return.

If you feel as though you possess these skills, though, and you have an academic inclination for mathematics, business or economics, then you should definitely consider a career in this lucrative and controversial but undoubtedly fascinating industry.


Knowledge

A person working in Banking in India typically earns around 36,400 INR per month. Salaries range from 20,600 INR (lowest average) to 67,300 INR (highest average, actual maximum salary is higher).

This is the average monthly salary including housing, transport, and other benefits. Salaries vary drastically between different Banking careers. If you are interested in the salary of a particular job, see below for salaries for specific job titles.


The median, the maximum, the minimum, and the range

  • Salary Range

Banking salaries in India range from 20,600 INR per month (minimum average salary) to 67,300 INR per month (maximum average salary, actual maximum is higher).

  • Median Salary

The median salary is 35,700 INR per month, which means that half (50%) of people working in Banking are earning less than 35,700 INR while the other half are earning more than 35,700 INR. The median represents the middle salary value. Generally speaking, you would want to be on the right side of the graph with the group earning more than the median salary.

  • Percentiles

Closely related to the median are two values: the 25th and the 75th percentiles. Reading from the salary distribution diagram, 25% of people working in Banking are earning less than 25,300 INR while 75% of them are earning more than 25,300 INR. Also from the diagram, 75% of people working in Banking are earning less than 50,400 INR while 25% are earning more than 50,400 INR.


Frequently Asked questionlymance


1) What is bank? What are the types of banks?

A bank is a financial institution licensed as a receiver of cash deposits. There are two types of banks, commercial banks and investment banks. In most of the countries, banks are regulated by the national government or central bank.

2) What is investment banking?

Investment banking manages portfolios of financial assets, commodity and currency, fixed income, corporate finance, corporate advisory services for mergers and acquisitions, debt and equity writing etc.

3) What is commercial bank?

Commercial bank is owned by the group of individuals or by a member of Federal Reserve System. The commercial bank offer services to individuals, they are primarily concerned with receiving deposits and lending to business. Such bank earns money by imposing interest on the loan borrowed by the borrower. The money that is deposited by the customer will be used by the bank to give business loan, auto loan, mortgages and home repair loans.

4) What are the types of Commercial Banks?

a) Retail or consumer banking

It is a small to mid-sized branch that directly deals with consumer’s transaction rather than corporate or other banks

b) Corporate or business banking

Corporate banking deals with cash management, underwriting, financing and issuing of stocks and bonds

c) Securities and Investment banking

Investment banking manages portfolios of financial assets, commodity and currency, fixed income, corporate finance, corporate advisory services for mergers and acquisitions, debt and equity writing etc.

d) Non-traditional options

There are many non-bank entities that offer financial services like that of the bank. The entities include credit card companies, credit card report agencies and credit card issuers

5) What is consumer bank?

Consumer bank is a new addition in the banking sector, such bank exist only in countries like U.S.A and Germany. This bank provides loans to their customer to buy T.V, Car, furniture etc. and give the option of easy payment through instalment.

6) What are the types of accounts in banks?

a) Checking Account: You can access the account as the saving account but, unlike saving account, you cannot earn interest on this account. The benefit of this account is that there is no limit for withdrawal.

b) Saving Account: You can save your money in such account and also earn interest on it. The number of withdrawal is limited and need to maintain the minimum amount of balance in the account to remain active.

c) Money Market Account: This account gives benefits of both saving and checking accounts. You can withdraw the amount and yet you can earn higher interest on it. This account can be opened with a minimum balance.

d) CD (Certificate of Deposits) Account: In such account you have to deposit your money for the fixed period of time (5-7 years), and you will earn the interest on it. The rate of interest is decided by the bank, and you cannot withdraw the funds until the fixed period expires.

7) What are the different ways you can operate your accounts?

You can operate your bank accounts in different ways like

a) Internet banking

b) Telephone or Mobile banking

c) Branch or Over the counter service

d) ATM ( Automated Teller Machine)

8) What are the things that you have to keep in concern before opening the bank accounts?

Before opening a bank account, if it is a saving account, you have to check the interest rate on the deposit and whether the interest rate remains consistent for the period. If you have the checking account, then look for how many cheques are free to use. Some banks may charge you for using paper cheques or ordering new cheque books. Also, check for different debit card option that is provided on opening an account and online banking features.

9) What is ‘Crossed Cheque’ ?

A crossed cheque indicates the amount should be deposited into the payees account and cannot be cashed by the bank over the counter. Here in the image, number#2, you can see two cross-lines on the left side corner of the cheque that indicates crossed cheque.


10) What is overdraft protection?

Overdraft protection is a service that is provided by a bank to their customer. For instance, if you are holding two accounts, saving and credit account, in the same bank. Now if one of your accounts does not have enough cash to process the cheques, or to cover the purchases. The bank will transfer money from one account to another account, which does not have cash so to prevent check return or to clear your shopping or electricity bills.

11) Do bank charge for ‘overdraft protection’ service?

Yes, bank will charge on ‘overdraft protection’ services but the charges will be applicable only when you start using the service.

12) What is (APR) Annual Percentage Rate?

APR stands for Annual Percentage Rate, and it is a charge or interest that the bank imposes on their customers for using their services like loans, credit cards, mortgage loan etc. The interest rate or fees imposed is calculated annually.

13) What is ‘prime rate’?

Basically, ‘prime rate’ is the rate of interest that is decided by nations (U.S.A) largest banks for their preferred customers, having a good credit score. Much ‘variable’ interest depends on the ‘prime rates’. For example, the ‘APR’ (Annual Percentage Rate) on a credit card is 10% plus prime rate, and if the prime rate is 3%, the current ‘APR’ on that credit card would be 13%.

14) What is ‘Fixed’ APR and ‘Variable’ APR?

‘APR’ (Annual Percentage Rate) can be ‘Fixed’ or ‘Variable’ type. In ‘Fixed APR’, the interest rate remains same throughout the term of the loan or mortgage, while in ‘Variable APR’ the interest rate will change without notice, based on the other factors like ‘prime rate’.

15) What are the different types of banking software applications are available in the Industry?

There are many types of banking software applications and few are listed below

a) Internet banking system: Internet banking allows the customers and financial institution to conduct final transaction using banks or financial institute website.

b) ATM banking (Automated Teller Machine): It is an electronic banking outlet, which allows customers to complete basic transaction.

c) Core banking system: Core banking is a service provided by a networked bank branches. With this, customer can withdraw money from any branch.

d) Loan management system: The database collects all the information and keeps the track about the customers who borrows the money.

e) Credit management system: Credit management system is a system for handling credit accounts, assessing risks and determining how much credit to offer to the customer.

f) Investment management system: It is a process of managing money, including investments, banking, budgeting and taxes.

g) Stock market management system: The stock market management is a system that manages financial portfolio like securities and bonds.

h) Financial management system: Financial management system is used to govern and keep a record of its income, expense and assets and to keep the accountability of its profit.

16) What is the ‘cost of debt’?

When any company borrows funds, from a financial institution (bank) or other resources the interest paid on that amount is known as ‘cost of debt’.

17) What is ‘balloon payment’?

The ‘balloon payment’ is the final lump sum payment that is due. When the entire loan payment is not amortized over the life of the loan, the remaining balance is due as the final repayment to the lender. Balloon payment can occur within an adjustable rate or fixed rate mortgage.

18) What is ‘Amortization’?

The repayment of the loan by instalment to cover principal amount with interest is known as ‘Amortization’.

19) What is negative Amortization?

When repayment of the loan is less than the loans accumulated interest, then negative Amortization occurs. It will increase the loan amount instead of decreasing it. It is also known as ‘deferred interest’.

20) What is the difference between ‘Cheque’ and ‘Demand draft’?

Both are used for the transfer of the amount between two accounts of same banks or different bank. ‘Cheque’ is issued by an individual who holds the account in a bank, while ‘Demand draft’ is issued by the bank on request, and will charge you for the service. Also, demand draft cannot be cancelled, while cheques can be cancelled once issued.


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