Description
The Indian banking sector is headed for consolidation. The presence of many regional players will see few banks emerging as global competitors.
An Organisational Study on State Bank of India- Zonal Office, Bangalore
E xecutive S ummary
Industry profile:
The banking industry in India today comprises of 27 public sectors, ! private
banks and 2" foreign banks#
The Indian banking sector is headed for consolidation# The presence of many
regional players $ill see fe$ banks emerging as global competitors#
%oreover, the likely rise in interest rates $ill see bank margins under pressure#
Treasury gains may $ilt in the current scenario# &ank profits in future may again
be driven by core income#
Indian banking industry in general and S&I in particular has positioned itself to
take advantage of such economic gro$th, India is likely to achieve#
'ompany profile:
There are a total of () 'ommercial banks in the country, $ith more than 7),)))
offices# ST*TE &*+, -. I+/I* o$ns 201 percent of these along $ith its seven
associates# The bank has reach# Its three2and2a2half times the si3e of the next
biggest bank, and bigger still than the next five banks put together# The bank has
dominance# It has 201 percent of the total banking business in India#
/espite its sheer si3e, and the legacy of the public sector, the bank is
surprisingly nimble# It4s computeri3ing its branches at a rapid pace, having
already done so in 5,))) branches# It hopes to computeri3e "(1 of the branch
net$ork by September 2))(, and all the branches by /ecember 2))(# The bank
has tied $ith T'S to develop core banking solutions, $hich $ill help net$ork the
branches#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
.or the moment, S&I is distancing itself from its old $ays and charting ne$
territories# * fe$ years from no$ people $ill be asking $hether it can remain
efficient despite the high 2gro$th blueprint# &ut for no$, it can be safely said6 the
bank is moving for$ard and taking on competition head on#
7roducts, services and departments
The bank has brought about a lot of innovation in its products and departments
and has come out $ith various schemes#
S&I is providing 8uality services for its customers, and has been successful in
keeping their customers happy#
9ith the support of the investors and customers and the efficient endeavours of
the staff, the bank is living upto the expectations of all concerned#
%y learning:
%y internship training at State &ank of India $as indeed a learning experience#
The organisation study has enhanced my kno$ledge regarding many aspects of
administration# #
I also got the opportunity to interact $ith the staff of S&I $hich proved to be very
educative#
It $as overall a very $onderful and splendid experience $hich I $holly cherish#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
I +/:ST;< 7 ;-.I=E
&anking in India has its origin as early as the >edic period# It is believed that the
transition from money lending to banking must have occurred even before# %anu,
the great ?indu @urist $ho has devoted a section of his $ork to deposits and
advances and laid do$n rules relating to rates of interest#
/uring the mogul period, the indigenous bankers played a very important role in
east India 'ompany6 it $as the turn of the agency houses to carry on the banking
business# The general bank of India $as the !
st
@oint stock bank to be established
in the year !70A# The others that follo$ed $ere the &ank of ?industan and the
&engal &ank failed in the meantime#
In the !
st
half of !"
th
century the East India 'ompany established banks:
The &ank of &engal in !0)"#
The &ank of &ombay in !05) and
The &ank of %adras in !05#
These banks also kno$n as 7residency &anks $ere independent units and
functioned as $ell# These banks $ere amalgamated in !"2) and a ne$ bank,
the Imperial &ank of India $as established on 27
th
Ban !"2!# 9ith the passing
S&I act in !"((, the undertaking of the Imperial &ank of India $as taken over by
the ne$ly constituted State &ank of India#
The ;&I $hich is the central bank of India $as created in !"(, by passing ;&I
act !"5# In the $ake of the s$adeshi movement, a no# of banks $ith Indian
management $ere established in the country namely, 7un@ab +ational &ank ltd#,
&ank of India ltd#, 'anara &ank =td#, Indian &ank =td#, the &ank of &aroda =td#,
the 'entral &ank of India =td#-n Buly !", !"A", !5 ma@or banks of the country
$ere nationalised and on !(
th
*pril !"0), A more commercial private banks $ere
also taken over by the Covernment#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Today, the commercial banking system in India may be distinguished into:
1. public sector banks
o S&I and its associate banks called the State &ank group#
o 2) nationalised banks#
o ;egional rural banks mainly sponsored by public sector banks#
2. private sector banks
o -ld generation private banks#
o +e$ generation private banks#
o .oreign banks in India#
o Scheduled co operative banks#
o +on2scheduled banks#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Indian .inancial System
The Indian .inancial System is broadly classified into 2 groups:
!# -rganised sector#
2# :norganised sector#
The financial system is also divided into users of financial services and providers#
.inancial institutions sell their services to households, businesses and
government $ho are all the users of financial services#
The providers of financial services are:
!# central &ank
2# other banks
# .inancial institutions#
5# money and capital markets
(# Informal financial enterprises#
The organised financial system comprises the follo$ing subsystems:
!# The &anking System#
2# The 'ooperative System#
!# /evelopment &anking System#
a# 7ublic Sector
b# 7rivate Sector#
2# %oney %arkets#
# .inancial companiesDInstitutions
An Organisational Study on State Bank of India- Zonal Office, Bangalore
The unorganised sector comprises of money lenders, indigenous bankers, pa$n
brokers, landlords, traders etc# there are also a host of financial companies, chit
funds etc# in the unorganised sector#
The central bank or the government does not regulate these in a systematic
manner#
&anking Scenario in India
* strong and vibrant banking sector $ith a net$ork of over (5,()) branches
supports Indian economy# &esides, a no# of national and state level financial
institutions, a large no# of domestic and foreign institutional investors, investment
funds, e8uipment leasing companies and venture capitalists add vigour to Indian
banking arena#
In the recent years, Indian banking system is undergoing an existential crisis# In
the pre2privati3ation period, $ere never ensconced in the financial sector# Then
came the banking regulation act of !"", $hich opened the floodgates for foreign
banks# .oreign banks are in the fray, forcing their Indian counterparts to adopt a
customer centric approach#
%erger of banks is also a recent phenomenon# Some of them are Times &ank
$ith ?/.' &ank, &ank of %adura $ith I'I'I &ank and the recent Clobal Trust
&ank $ith -riental &ank of 'ommerce#
IT in &anking
Indian banking industry, today is in the midst of an IT revolution# * combination of
regulatory and competitive reasons has lead to increasingly importance of total
banking automation in the Indian banking industry#
'ompetition, gro$ing expectations of customers and increased a$areness
among customers has led to the IT aspect in banking#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
E volution of S tate & ank of I ndia
The origin of the State Bank of India goes back to the first decade of the
nineteenth century $ith the establishment of the &ank of 'alcutta in 'alcutta on
2 Bune !0)A# Three years later the bank received its charter and $as re2
designed as the &ank of &engal E2 Banuary !0)"F# * uni8ue institution, it $as the
first @oint2stock bank of &ritish India sponsored by the Covernment of &engal# The
&ank of &ombay E!( *pril !05)F and the &ank of %adras E! Buly !05F follo$ed
the &ank of &engal# These three banks remained at the apex of modern banking
in India till their amalgamation as the Imperial &ank of India on 27 Banuary !"2!#
7rimarily *nglo2Indian creations, the three presidency banks came into existence
either as a result of the compulsions of imperial finance or by the felt needs of
local European commerce and $ere not imposed from outside in an arbitrary
manner to moderni3e IndiaGs economy# Their evolution $as, ho$ever, shaped by
ideas culled from similar developments in Europe and England, and $as
influenced by changes occurring in the structure of both the local trading
environment and those in the relations of the Indian economy to the economy of
Europe and the global economic frame$ork#
Bank of Bengal H.O.
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Establishment
The establishment of the &ank of &engal marked the advent of limited liability,
@oint2stock banking in India# So $as the associated innovation in banking, vi3# the
decision to allo$ the &ank of &engal to issue notes, $hich $ould be accepted for
payment of public revenues $ithin a restricted geographical area# This right of
note issue $as very valuable not only for the &ank of &engal but also its t$o
siblings, the &anks of &ombay and %adras# It meant an accretion to the capital of
the banks, a capital on $hich the proprietors did not have to pay any interest#
The concept of deposit banking $as also an innovation because the practice of
accepting money for safekeeping Eand in some cases, even investment on behalf
of the clientsF by the indigenous bankers had not spread as a general habit in
most parts of India# &ut, for a long time, and especially upto the time that the
three presidency banks had a right of note issue, bank notes and government
balances made up the bulk of the investible resources of the banks#
The three banks $ere governed by royal charters, $hich $ere revised from time
to time# Each charter provided for a share capital, four2fifth of $hich $ere
privately subscribed and the rest o$ned by the provincial government# The
members of the
board of directors, $hich managed the affairs of each bank, $ere mostly
proprietary directors representing the large European managing agency houses
in India# The rest $ere government nominees, invariably civil servants, one of
$hom $as elected as the president of the board#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Group Photograph of Central Board 1!21"
&usiness:
The business of the banks $as initially confined to discounting of bills of
exchange or other negotiable private securities, keeping cash accounts and
receiving deposits and issuing and circulating cash notes# =oans $ere restricted
to ;s#one lakh and the period of accommodation confined to three months only#
The security for such loans $as public securities, commonly called 'ompanyGs
7aper, bullion, treasure, plate, @e$els, or goods Gnot of a perishable natureG and
no interest could be charged beyond a rate of t$elve per cent# =oans against
goods like opium, indigo, salt $oolens, cotton, cotton piece goods, mule t$ist and
silk goods $ere also granted but such finance by $ay of cash credits gained
momentum only from the third decade of the nineteenth century# *ll commodities,
including tea, sugar and @ute, $hich began to be financed later, $ere either
pledged or hypothecated to the bank# /emand promissory notes $ere signed by
the borro$er in favor of the guarantor, $hich $as in turn endorsed to the bank#
=ending against shares of the banks or on the mortgage of houses, land or other
real property $as, ho$ever, forbidden#
Indians $ere the principal borro$ers against deposit of 'ompanyGs paper, $hile
the business of discounts on private as $ell as salary bills $as almost the
exclusive monopoly of individuals Europeans and their partnership firms# &ut the
main function of the three banks, as far as the government $as concerned, $as
An Organisational Study on State Bank of India- Zonal Office, Bangalore
to help the latter raise loans from time to time and also provide a degree of
stability to the prices of government securities#
Old Bank of Bengal
%a@or change in the conditions
* ma@or change in the conditions of operation of the &anks of &engal, &ombay
and %adras occurred after !0A)# 9ith the passing of the 7aper 'urrency *ct of
!0A!, the right of note issue of the presidency banks $as abolished and the
Covernment of India assumed from ! %arch !0A2 the sole po$er of issuing
paper currency $ithin &ritish India# The task of management and circulation of
the ne$ currency notes $as conferred on the presidency banks and the
Covernment undertook to transfer the Treasury balances to the banks at places
$here the banks $ould open branches# +one of the three banks had till then any
branches Eexcept the sole attempt and that too a short2lived one by the &ank of
&engal at %ir3apore in !0"F although the charters had given them such
authority# &ut as soon as the three presidency bands $ere assured of the free
use of government Treasury balances at places $here they $ould open
branches, they embarked on branch expansion at a rapid pace# &y !07A, the
branches, agencies and sub agencies of the three presidency banks covered
most of the ma@or parts and many of the inland trade centres in India# 9hile the
&ank of &engal had eighteen branches including its head office, seasonal
branches and sub agencies, the &anks of &ombay and %adras had fifteen each#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Bank of #adras $ote %ated 1&'1 for (s.1)
7residency &anks *ct
The presidency &anks *ct, $hich came into operation on ! %ay !07A, brought
the three presidency banks under a common statute $ith similar restrictions on
business# The proprietary connection of the Covernment $as, ho$ever,
terminated, though the banks continued to hold charge of the public debt offices
in the three presidency to$ns, and the custody of a part of the government
balances# The *ct also stipulated the creation of ;eserve Treasuries at 'alcutta,
&ombay and %adras into $hich sums above the specified minimum balances
promised to the presidency banks at only their head offices $ere to be lodged#
The Covernment could lend to the presidency banks from such ;eserve
Treasuries but the latter could look upon them more as a favor than as a right#
Bank of #adras
An Organisational Study on State Bank of India- Zonal Office, Bangalore
The decision of the Covernment to keep the surplus balances in ;eserve
Treasuries outside the normal control of the presidency banks and the connected
decision not to guarantee minimum government balances at ne$ places $here
branches $ere to be opened effectively checked the gro$th of ne$ branches
after !07A# The pace of expansion $itnessed in the previous decade fell sharply
although, in the case of the &ank of %adras, it continued on a modest scale as
the profits of that bank $ere mainly derived from trade dispersed among a
number of port to$ns and inland centres of the presidency#
India $itnessed rapid commerciali3ation in the last 8uarter of the nineteenth
century as its rail$ay net$ork expanded to cover all the ma@or regions of the
country# +e$ irrigation net$orks in %adras, 7un@ab and Sind accelerated the
process of conversion of subsistence crops into cash crops, a portion of $hich
found its $ay into the foreign markets# Tea and coffee plantations transformed
large areas of the eastern Terais, the hills of *ssam and the +ilgiris into regions
of estate agriculture par excellence# *ll these resulted in the expansion of IndiaGs
international trade more than six2fold# The three presidency banks $ere both
beneficiaries and promoters of this commerciali3ation process as they became
involved in the financing of practically every trading, manufacturing and mining
activity in the sub2continent# 9hile the &anks of &engal and &ombay $ere
engaged in the financing of large modern manufacturing industries, the &ank of
%adras $ent into the financing of large modern manufacturing industries, the
&ank of %adras $ent into the financing of small2scale industries in a $ay $hich
had no parallel else$here# &ut the three banks $ere rigorously excluded from
any business involving foreign exchange# +ot only $as such business
considered risky for these banks, $hich held government deposits, it $as also
feared that these banks en@oying government patronage $ould offer unfair
competition to the exchange banks $hich had by then arrived in India# This
exclusion continued till the creation of the ;eserve &ank of India in !"(#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Bank of Bo*ba+
7residency &anks of &engal
The presidency &anks of &engal, &ombay and %adras $ith their 7) branches
$ere merged in !"2! to form the Imperial &ank of India# The triad had been
transformed into a monolith and a giant among Indian commercial banks had
emerged# The ne$ bank took on the triple role of a commercial bank, a bankerGs
bank and a banker to the government#
&ut this creation $as preceded by years of deliberations on the need for a GState
&ank of IndiaG# 9hat eventually emerged $as a Ghalf2$ay houseG combining the
functions of a commercial bank and a 8uasi2central bank#
The establishment of the ;eserve &ank of India as the central bank of the
country in !"( ended the 8uasi2central banking role of the Imperial &ank# The
latter ceased to be bankers to the Covernment of India and instead became
agent of the ;eserve &ank for the transaction of government business at centers
at $hich the central bank $as not established# &ut it continued to maintain
currency chests and small coin depots and operate the remittance facilities
scheme for other banks and the public on terms stipulated by the ;eserve &ank#
It also acted as a bankersG bank by holding their surplus cash and granting them
advances against authori3ed securities# The management of the bank clearing
houses also continued $ith it at many places $here the ;eserve &ank did not
have offices# The bank $as also the biggest tenderer at the Treasury bill auctions
An Organisational Study on State Bank of India- Zonal Office, Bangalore
conducted by the ;eserve &ank on behalf of the Covernment#
The establishment of the ;eserve &ank simultaneously sa$ important
amendments being made to the constitution of the Imperial &ank converting it
into a purely commercial bank# The earlier restrictions on its business $ere
removed and the bank $as permitted to undertake foreign exchange business
and executor and trustee business for the first time#
Imperial &ank
The Imperial &ank during the three and a half decades of its existence recorded
an impressive gro$th in terms of offices, reserves, deposits, investments and
advances,
the increases in some cases amounting to more than six2fold# The financial
status and security inherited from its forerunners no doubt provided a firm and
durable platform# &ut the lofty traditions of banking $hich the Imperial &ank
consistently maintained and the high standard of integrity it observed in its
operations inspired confidence in its depositors that no other bank in India could
perhaps then e8ual# *ll these enabled the Imperial &ank to ac8uire a pre2eminent
position in the Indian banking industry and also secure a vital place in the
countryGs economic life#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Sta*p of I*perial Bank of India
9hen India attained freedom, the Imperial &ank had a capital base Eincluding
reservesF of ;s#!!#0( crores, deposits and advances of ;s#27(#!5 crores and
;s#72#"5 crores respectively and a net$ork of !72 branches and more than 2))
sub offices extending all over the country#
.irst .ive ob Satisfaction0
o 9age structure
o +ature of $ork
o 7romotions
o 9ork group
o 9orking conditions
o Supervision
An Organisational Study on State Bank of India- Zonal Office, Bangalore
; ESE*;'? % ET?-/-=-C<
Background of the stud+
Bob satisfaction is a $idespread problem# 7roductivity, efficiency are related to
$ork force# To achieve those one should be committed to the organisation to the
long term# This in turn depends on the level of @ob satisfaction and the morale of
the employees#
Bob satisfaction improves the performance of an organisation#
State*ent of the proble*
The research problem selected is entitled as NBob satisfaction of employees in
S&I, Konal -ffice, &angaloreO#
$eed and i*portance of stud+
o This study is undertaken to find out the level of @ob satisfaction among the
employees of S&I# %oreover, this study is to kno$ the impact of $orking
conditions, company policies and its impact on the @ob satisfaction#
o This study $ill help the organisation to design their @ob satisfaction
programme#
o %anagement can decide $hether the existing @ob satisfaction programme
should be continued or revised#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
H+pothesis0
o There exists no difference in the perception of @ob satisfaction as perceived by
employees of S&I
o There exists difference in the perception of @ob satisfaction as perceived by
employees of S&I#
Pri*ar+ Ob4ective
o To study the level of @ob satisfaction in S&I
Secondar+ Ob4ectives
o To study the effects and outcomes of @ob dissatisfaction
o To identify potential causes for @ob satisfaction
o To measure the level of @ob satisfaction in relation to various factors like the
physical and social environment, training and development, goals, re$ards
remuneration etc#
Scope
This study is undertaken to find out the level of @ob satisfaction among the
employees of S&I, Konal -ffice, &angalore#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
.i*itation
o The sample si3e $as limited
o It includes the officers and clerks of the Konal -ffice only and not the
organisation as a $hole#
o ;espondents did not ans$er a fe$ 8uestions#
o -pinion of the respondents may be raised#
o The study is sensitive in nature and there might be a colour of bias in
ans$ering the 8uestionnaire#
Sources of %ata0
Pri*ar+ %ata0
7rimary data has been collected through administering the 8uestionnaires
personally to employees of S&I# The response $ill be analysed and evaluated to
extract the re8uired information#
Secondar+ %ata0
Secondary data has been collected by $ay of personal meeting $ith employees
of S&I and also various reports collected from them#
Information $as also collected from $ebsites, brochures, bank @ournals,
maga3ines etc#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Sa*ple si?e0
The sample si3e considered for the research is ()#
Sa*pling techni=ue0
The sampling techni8ue used is simple random sampling#
(esearch Instru*ent0
The instruments used for research are mainly 8uestionnaires and intervie$s#
* set of 8uestionnaires $as presented to respondents# &ecause of its flexibility, it
is by far the most common instrument used to collect primary data# Huestions
$ere carefully developed, tested and debugged before administering in a large
scale#
The 8uestions and their form, $ording and se8uence $ere carefully chosen#
'lose ended 8uestions $ere chosen specifying all possible ans$ers
:nder close2ended 8uestions, the follo$ing types of 8uestions $ere asked in the
8uestionnaire#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
/ ata * nalysis
The various parameters selected for analysing the @ob satisfaction level are:
? ;emuneration
? Training J /evelopment
? 'ommunication
? Coals
? Team$ork
? 7romotions
? =eadership
? ;e$ards J 7unishment
? Social Environment
? 7hysical Environment
7reviously conducted surveys prove that the above mentioned parameters have
a highly positive correlation $ith the @ob satisfaction level#
.eedback given by the employees regarding the above mentioned parameters
have been analysed to find out the employees perception about these
parameters and thereby the overall @ob satisfaction level is measured#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Graph depicting the satisfaction level 7ith respect to (e*uneration0
Sa&i(fa!&i'n le+el -er!en&ae (1)
T' a +er* (mall e2&en& nil
T' a (mall e2&en& 34.3
T' a lare e2&en& 56.6
T' a +er* lare e2&en& 74
Graph 1
? 2!#21 of the employees are satisfied $ith the remuneration to a small extent#
? 50#01 of the employees are satisfied $ith their remuneration to a large extent
? !1 of the employees are very much satisfied $ith their remuneration#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Graph depicting satisfaction level regarding 1raining 8 %evelop*ent0
Sa&i(fa!&i'n le+el -er!en&ae (1)
T' a +er* (mall e2&en& 8
T' a (mall e2&en& 36.7
T' a lare e2&en& 75.9
T' a +er* lare e2&en& 7:.4
Graph 2
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Graph depicting satisfaction level regarding Co**unication 7ith peers
and superiors0
Sa&i(fa!&i'n le+el -er!en&ae (1)
T' a +er* (mall e2&en& 7.5
T' a (mall e2&en& 39.9
T' a lare e2&en& 57.3
T' a +er* lare e2&en& 39.6
Graph @
? #51 of the employees feel very uncomfortable to communicate $ith their
peers and superiors#
? 2A#A1 of the employees are satisfied to a small extent $ith regard to
communication#
? 5#21 of the employees a satisfied to a large extent $ith regard to
communication#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
? 2A#01 of the employees to a very large extent are comfortable in
communicating $ith their superiors and peers#
Graph depicting ho7 clear are the e*plo+ees regarding goals of their
depart*ents and the organisation.
Satisfaction level percentage E1F
To a very small extent A#A
To a small extent !)
To a large extent (A#A
To a very large extent 2A#0
Graph A
? A#A1 of the employees are not very clear $ith their goals#
? !)1 of the employees are clear to a small extent $ith their goals#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
? (A#A1 of the employees are clear $ith their goals to a large extent#
? 2A#01 of the employees do not have any confusion $ith regard to
their goals#
Graph sho7ing the e6tent of tea*7ork present bet7een the e*plo+ees
Sa&i(fa!&i'n le+el -er!en&ae (1)
T' a +er* (mall e2&en& 6.43
T' a (mall e2&en& 75.6:
T' a lare e2&en& ;7.
The Indian banking sector is headed for consolidation. The presence of many regional players will see few banks emerging as global competitors.
An Organisational Study on State Bank of India- Zonal Office, Bangalore
E xecutive S ummary
Industry profile:
The banking industry in India today comprises of 27 public sectors, ! private
banks and 2" foreign banks#
The Indian banking sector is headed for consolidation# The presence of many
regional players $ill see fe$ banks emerging as global competitors#
%oreover, the likely rise in interest rates $ill see bank margins under pressure#
Treasury gains may $ilt in the current scenario# &ank profits in future may again
be driven by core income#
Indian banking industry in general and S&I in particular has positioned itself to
take advantage of such economic gro$th, India is likely to achieve#
'ompany profile:
There are a total of () 'ommercial banks in the country, $ith more than 7),)))
offices# ST*TE &*+, -. I+/I* o$ns 201 percent of these along $ith its seven
associates# The bank has reach# Its three2and2a2half times the si3e of the next
biggest bank, and bigger still than the next five banks put together# The bank has
dominance# It has 201 percent of the total banking business in India#
/espite its sheer si3e, and the legacy of the public sector, the bank is
surprisingly nimble# It4s computeri3ing its branches at a rapid pace, having
already done so in 5,))) branches# It hopes to computeri3e "(1 of the branch
net$ork by September 2))(, and all the branches by /ecember 2))(# The bank
has tied $ith T'S to develop core banking solutions, $hich $ill help net$ork the
branches#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
.or the moment, S&I is distancing itself from its old $ays and charting ne$
territories# * fe$ years from no$ people $ill be asking $hether it can remain
efficient despite the high 2gro$th blueprint# &ut for no$, it can be safely said6 the
bank is moving for$ard and taking on competition head on#
7roducts, services and departments
The bank has brought about a lot of innovation in its products and departments
and has come out $ith various schemes#
S&I is providing 8uality services for its customers, and has been successful in
keeping their customers happy#
9ith the support of the investors and customers and the efficient endeavours of
the staff, the bank is living upto the expectations of all concerned#
%y learning:
%y internship training at State &ank of India $as indeed a learning experience#
The organisation study has enhanced my kno$ledge regarding many aspects of
administration# #
I also got the opportunity to interact $ith the staff of S&I $hich proved to be very
educative#
It $as overall a very $onderful and splendid experience $hich I $holly cherish#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
I +/:ST;< 7 ;-.I=E
&anking in India has its origin as early as the >edic period# It is believed that the
transition from money lending to banking must have occurred even before# %anu,
the great ?indu @urist $ho has devoted a section of his $ork to deposits and
advances and laid do$n rules relating to rates of interest#
/uring the mogul period, the indigenous bankers played a very important role in
east India 'ompany6 it $as the turn of the agency houses to carry on the banking
business# The general bank of India $as the !
st
@oint stock bank to be established
in the year !70A# The others that follo$ed $ere the &ank of ?industan and the
&engal &ank failed in the meantime#
In the !
st
half of !"
th
century the East India 'ompany established banks:
The &ank of &engal in !0)"#
The &ank of &ombay in !05) and
The &ank of %adras in !05#
These banks also kno$n as 7residency &anks $ere independent units and
functioned as $ell# These banks $ere amalgamated in !"2) and a ne$ bank,
the Imperial &ank of India $as established on 27
th
Ban !"2!# 9ith the passing
S&I act in !"((, the undertaking of the Imperial &ank of India $as taken over by
the ne$ly constituted State &ank of India#
The ;&I $hich is the central bank of India $as created in !"(, by passing ;&I
act !"5# In the $ake of the s$adeshi movement, a no# of banks $ith Indian
management $ere established in the country namely, 7un@ab +ational &ank ltd#,
&ank of India ltd#, 'anara &ank =td#, Indian &ank =td#, the &ank of &aroda =td#,
the 'entral &ank of India =td#-n Buly !", !"A", !5 ma@or banks of the country
$ere nationalised and on !(
th
*pril !"0), A more commercial private banks $ere
also taken over by the Covernment#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Today, the commercial banking system in India may be distinguished into:
1. public sector banks
o S&I and its associate banks called the State &ank group#
o 2) nationalised banks#
o ;egional rural banks mainly sponsored by public sector banks#
2. private sector banks
o -ld generation private banks#
o +e$ generation private banks#
o .oreign banks in India#
o Scheduled co operative banks#
o +on2scheduled banks#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Indian .inancial System
The Indian .inancial System is broadly classified into 2 groups:
!# -rganised sector#
2# :norganised sector#
The financial system is also divided into users of financial services and providers#
.inancial institutions sell their services to households, businesses and
government $ho are all the users of financial services#
The providers of financial services are:
!# central &ank
2# other banks
# .inancial institutions#
5# money and capital markets
(# Informal financial enterprises#
The organised financial system comprises the follo$ing subsystems:
!# The &anking System#
2# The 'ooperative System#
!# /evelopment &anking System#
a# 7ublic Sector
b# 7rivate Sector#
2# %oney %arkets#
# .inancial companiesDInstitutions
An Organisational Study on State Bank of India- Zonal Office, Bangalore
The unorganised sector comprises of money lenders, indigenous bankers, pa$n
brokers, landlords, traders etc# there are also a host of financial companies, chit
funds etc# in the unorganised sector#
The central bank or the government does not regulate these in a systematic
manner#
&anking Scenario in India
* strong and vibrant banking sector $ith a net$ork of over (5,()) branches
supports Indian economy# &esides, a no# of national and state level financial
institutions, a large no# of domestic and foreign institutional investors, investment
funds, e8uipment leasing companies and venture capitalists add vigour to Indian
banking arena#
In the recent years, Indian banking system is undergoing an existential crisis# In
the pre2privati3ation period, $ere never ensconced in the financial sector# Then
came the banking regulation act of !"", $hich opened the floodgates for foreign
banks# .oreign banks are in the fray, forcing their Indian counterparts to adopt a
customer centric approach#
%erger of banks is also a recent phenomenon# Some of them are Times &ank
$ith ?/.' &ank, &ank of %adura $ith I'I'I &ank and the recent Clobal Trust
&ank $ith -riental &ank of 'ommerce#
IT in &anking
Indian banking industry, today is in the midst of an IT revolution# * combination of
regulatory and competitive reasons has lead to increasingly importance of total
banking automation in the Indian banking industry#
'ompetition, gro$ing expectations of customers and increased a$areness
among customers has led to the IT aspect in banking#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
E volution of S tate & ank of I ndia
The origin of the State Bank of India goes back to the first decade of the
nineteenth century $ith the establishment of the &ank of 'alcutta in 'alcutta on
2 Bune !0)A# Three years later the bank received its charter and $as re2
designed as the &ank of &engal E2 Banuary !0)"F# * uni8ue institution, it $as the
first @oint2stock bank of &ritish India sponsored by the Covernment of &engal# The
&ank of &ombay E!( *pril !05)F and the &ank of %adras E! Buly !05F follo$ed
the &ank of &engal# These three banks remained at the apex of modern banking
in India till their amalgamation as the Imperial &ank of India on 27 Banuary !"2!#
7rimarily *nglo2Indian creations, the three presidency banks came into existence
either as a result of the compulsions of imperial finance or by the felt needs of
local European commerce and $ere not imposed from outside in an arbitrary
manner to moderni3e IndiaGs economy# Their evolution $as, ho$ever, shaped by
ideas culled from similar developments in Europe and England, and $as
influenced by changes occurring in the structure of both the local trading
environment and those in the relations of the Indian economy to the economy of
Europe and the global economic frame$ork#
Bank of Bengal H.O.
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Establishment
The establishment of the &ank of &engal marked the advent of limited liability,
@oint2stock banking in India# So $as the associated innovation in banking, vi3# the
decision to allo$ the &ank of &engal to issue notes, $hich $ould be accepted for
payment of public revenues $ithin a restricted geographical area# This right of
note issue $as very valuable not only for the &ank of &engal but also its t$o
siblings, the &anks of &ombay and %adras# It meant an accretion to the capital of
the banks, a capital on $hich the proprietors did not have to pay any interest#
The concept of deposit banking $as also an innovation because the practice of
accepting money for safekeeping Eand in some cases, even investment on behalf
of the clientsF by the indigenous bankers had not spread as a general habit in
most parts of India# &ut, for a long time, and especially upto the time that the
three presidency banks had a right of note issue, bank notes and government
balances made up the bulk of the investible resources of the banks#
The three banks $ere governed by royal charters, $hich $ere revised from time
to time# Each charter provided for a share capital, four2fifth of $hich $ere
privately subscribed and the rest o$ned by the provincial government# The
members of the
board of directors, $hich managed the affairs of each bank, $ere mostly
proprietary directors representing the large European managing agency houses
in India# The rest $ere government nominees, invariably civil servants, one of
$hom $as elected as the president of the board#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Group Photograph of Central Board 1!21"
&usiness:
The business of the banks $as initially confined to discounting of bills of
exchange or other negotiable private securities, keeping cash accounts and
receiving deposits and issuing and circulating cash notes# =oans $ere restricted
to ;s#one lakh and the period of accommodation confined to three months only#
The security for such loans $as public securities, commonly called 'ompanyGs
7aper, bullion, treasure, plate, @e$els, or goods Gnot of a perishable natureG and
no interest could be charged beyond a rate of t$elve per cent# =oans against
goods like opium, indigo, salt $oolens, cotton, cotton piece goods, mule t$ist and
silk goods $ere also granted but such finance by $ay of cash credits gained
momentum only from the third decade of the nineteenth century# *ll commodities,
including tea, sugar and @ute, $hich began to be financed later, $ere either
pledged or hypothecated to the bank# /emand promissory notes $ere signed by
the borro$er in favor of the guarantor, $hich $as in turn endorsed to the bank#
=ending against shares of the banks or on the mortgage of houses, land or other
real property $as, ho$ever, forbidden#
Indians $ere the principal borro$ers against deposit of 'ompanyGs paper, $hile
the business of discounts on private as $ell as salary bills $as almost the
exclusive monopoly of individuals Europeans and their partnership firms# &ut the
main function of the three banks, as far as the government $as concerned, $as
An Organisational Study on State Bank of India- Zonal Office, Bangalore
to help the latter raise loans from time to time and also provide a degree of
stability to the prices of government securities#
Old Bank of Bengal
%a@or change in the conditions
* ma@or change in the conditions of operation of the &anks of &engal, &ombay
and %adras occurred after !0A)# 9ith the passing of the 7aper 'urrency *ct of
!0A!, the right of note issue of the presidency banks $as abolished and the
Covernment of India assumed from ! %arch !0A2 the sole po$er of issuing
paper currency $ithin &ritish India# The task of management and circulation of
the ne$ currency notes $as conferred on the presidency banks and the
Covernment undertook to transfer the Treasury balances to the banks at places
$here the banks $ould open branches# +one of the three banks had till then any
branches Eexcept the sole attempt and that too a short2lived one by the &ank of
&engal at %ir3apore in !0"F although the charters had given them such
authority# &ut as soon as the three presidency bands $ere assured of the free
use of government Treasury balances at places $here they $ould open
branches, they embarked on branch expansion at a rapid pace# &y !07A, the
branches, agencies and sub agencies of the three presidency banks covered
most of the ma@or parts and many of the inland trade centres in India# 9hile the
&ank of &engal had eighteen branches including its head office, seasonal
branches and sub agencies, the &anks of &ombay and %adras had fifteen each#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Bank of #adras $ote %ated 1&'1 for (s.1)
7residency &anks *ct
The presidency &anks *ct, $hich came into operation on ! %ay !07A, brought
the three presidency banks under a common statute $ith similar restrictions on
business# The proprietary connection of the Covernment $as, ho$ever,
terminated, though the banks continued to hold charge of the public debt offices
in the three presidency to$ns, and the custody of a part of the government
balances# The *ct also stipulated the creation of ;eserve Treasuries at 'alcutta,
&ombay and %adras into $hich sums above the specified minimum balances
promised to the presidency banks at only their head offices $ere to be lodged#
The Covernment could lend to the presidency banks from such ;eserve
Treasuries but the latter could look upon them more as a favor than as a right#
Bank of #adras
An Organisational Study on State Bank of India- Zonal Office, Bangalore
The decision of the Covernment to keep the surplus balances in ;eserve
Treasuries outside the normal control of the presidency banks and the connected
decision not to guarantee minimum government balances at ne$ places $here
branches $ere to be opened effectively checked the gro$th of ne$ branches
after !07A# The pace of expansion $itnessed in the previous decade fell sharply
although, in the case of the &ank of %adras, it continued on a modest scale as
the profits of that bank $ere mainly derived from trade dispersed among a
number of port to$ns and inland centres of the presidency#
India $itnessed rapid commerciali3ation in the last 8uarter of the nineteenth
century as its rail$ay net$ork expanded to cover all the ma@or regions of the
country# +e$ irrigation net$orks in %adras, 7un@ab and Sind accelerated the
process of conversion of subsistence crops into cash crops, a portion of $hich
found its $ay into the foreign markets# Tea and coffee plantations transformed
large areas of the eastern Terais, the hills of *ssam and the +ilgiris into regions
of estate agriculture par excellence# *ll these resulted in the expansion of IndiaGs
international trade more than six2fold# The three presidency banks $ere both
beneficiaries and promoters of this commerciali3ation process as they became
involved in the financing of practically every trading, manufacturing and mining
activity in the sub2continent# 9hile the &anks of &engal and &ombay $ere
engaged in the financing of large modern manufacturing industries, the &ank of
%adras $ent into the financing of large modern manufacturing industries, the
&ank of %adras $ent into the financing of small2scale industries in a $ay $hich
had no parallel else$here# &ut the three banks $ere rigorously excluded from
any business involving foreign exchange# +ot only $as such business
considered risky for these banks, $hich held government deposits, it $as also
feared that these banks en@oying government patronage $ould offer unfair
competition to the exchange banks $hich had by then arrived in India# This
exclusion continued till the creation of the ;eserve &ank of India in !"(#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Bank of Bo*ba+
7residency &anks of &engal
The presidency &anks of &engal, &ombay and %adras $ith their 7) branches
$ere merged in !"2! to form the Imperial &ank of India# The triad had been
transformed into a monolith and a giant among Indian commercial banks had
emerged# The ne$ bank took on the triple role of a commercial bank, a bankerGs
bank and a banker to the government#
&ut this creation $as preceded by years of deliberations on the need for a GState
&ank of IndiaG# 9hat eventually emerged $as a Ghalf2$ay houseG combining the
functions of a commercial bank and a 8uasi2central bank#
The establishment of the ;eserve &ank of India as the central bank of the
country in !"( ended the 8uasi2central banking role of the Imperial &ank# The
latter ceased to be bankers to the Covernment of India and instead became
agent of the ;eserve &ank for the transaction of government business at centers
at $hich the central bank $as not established# &ut it continued to maintain
currency chests and small coin depots and operate the remittance facilities
scheme for other banks and the public on terms stipulated by the ;eserve &ank#
It also acted as a bankersG bank by holding their surplus cash and granting them
advances against authori3ed securities# The management of the bank clearing
houses also continued $ith it at many places $here the ;eserve &ank did not
have offices# The bank $as also the biggest tenderer at the Treasury bill auctions
An Organisational Study on State Bank of India- Zonal Office, Bangalore
conducted by the ;eserve &ank on behalf of the Covernment#
The establishment of the ;eserve &ank simultaneously sa$ important
amendments being made to the constitution of the Imperial &ank converting it
into a purely commercial bank# The earlier restrictions on its business $ere
removed and the bank $as permitted to undertake foreign exchange business
and executor and trustee business for the first time#
Imperial &ank
The Imperial &ank during the three and a half decades of its existence recorded
an impressive gro$th in terms of offices, reserves, deposits, investments and
advances,
the increases in some cases amounting to more than six2fold# The financial
status and security inherited from its forerunners no doubt provided a firm and
durable platform# &ut the lofty traditions of banking $hich the Imperial &ank
consistently maintained and the high standard of integrity it observed in its
operations inspired confidence in its depositors that no other bank in India could
perhaps then e8ual# *ll these enabled the Imperial &ank to ac8uire a pre2eminent
position in the Indian banking industry and also secure a vital place in the
countryGs economic life#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Sta*p of I*perial Bank of India
9hen India attained freedom, the Imperial &ank had a capital base Eincluding
reservesF of ;s#!!#0( crores, deposits and advances of ;s#27(#!5 crores and
;s#72#"5 crores respectively and a net$ork of !72 branches and more than 2))
sub offices extending all over the country#
.irst .ive ob Satisfaction0
o 9age structure
o +ature of $ork
o 7romotions
o 9ork group
o 9orking conditions
o Supervision
An Organisational Study on State Bank of India- Zonal Office, Bangalore
; ESE*;'? % ET?-/-=-C<
Background of the stud+
Bob satisfaction is a $idespread problem# 7roductivity, efficiency are related to
$ork force# To achieve those one should be committed to the organisation to the
long term# This in turn depends on the level of @ob satisfaction and the morale of
the employees#
Bob satisfaction improves the performance of an organisation#
State*ent of the proble*
The research problem selected is entitled as NBob satisfaction of employees in
S&I, Konal -ffice, &angaloreO#
$eed and i*portance of stud+
o This study is undertaken to find out the level of @ob satisfaction among the
employees of S&I# %oreover, this study is to kno$ the impact of $orking
conditions, company policies and its impact on the @ob satisfaction#
o This study $ill help the organisation to design their @ob satisfaction
programme#
o %anagement can decide $hether the existing @ob satisfaction programme
should be continued or revised#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
H+pothesis0
o There exists no difference in the perception of @ob satisfaction as perceived by
employees of S&I
o There exists difference in the perception of @ob satisfaction as perceived by
employees of S&I#
Pri*ar+ Ob4ective
o To study the level of @ob satisfaction in S&I
Secondar+ Ob4ectives
o To study the effects and outcomes of @ob dissatisfaction
o To identify potential causes for @ob satisfaction
o To measure the level of @ob satisfaction in relation to various factors like the
physical and social environment, training and development, goals, re$ards
remuneration etc#
Scope
This study is undertaken to find out the level of @ob satisfaction among the
employees of S&I, Konal -ffice, &angalore#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
.i*itation
o The sample si3e $as limited
o It includes the officers and clerks of the Konal -ffice only and not the
organisation as a $hole#
o ;espondents did not ans$er a fe$ 8uestions#
o -pinion of the respondents may be raised#
o The study is sensitive in nature and there might be a colour of bias in
ans$ering the 8uestionnaire#
Sources of %ata0
Pri*ar+ %ata0
7rimary data has been collected through administering the 8uestionnaires
personally to employees of S&I# The response $ill be analysed and evaluated to
extract the re8uired information#
Secondar+ %ata0
Secondary data has been collected by $ay of personal meeting $ith employees
of S&I and also various reports collected from them#
Information $as also collected from $ebsites, brochures, bank @ournals,
maga3ines etc#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Sa*ple si?e0
The sample si3e considered for the research is ()#
Sa*pling techni=ue0
The sampling techni8ue used is simple random sampling#
(esearch Instru*ent0
The instruments used for research are mainly 8uestionnaires and intervie$s#
* set of 8uestionnaires $as presented to respondents# &ecause of its flexibility, it
is by far the most common instrument used to collect primary data# Huestions
$ere carefully developed, tested and debugged before administering in a large
scale#
The 8uestions and their form, $ording and se8uence $ere carefully chosen#
'lose ended 8uestions $ere chosen specifying all possible ans$ers
:nder close2ended 8uestions, the follo$ing types of 8uestions $ere asked in the
8uestionnaire#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
/ ata * nalysis
The various parameters selected for analysing the @ob satisfaction level are:
? ;emuneration
? Training J /evelopment
? 'ommunication
? Coals
? Team$ork
? 7romotions
? =eadership
? ;e$ards J 7unishment
? Social Environment
? 7hysical Environment
7reviously conducted surveys prove that the above mentioned parameters have
a highly positive correlation $ith the @ob satisfaction level#
.eedback given by the employees regarding the above mentioned parameters
have been analysed to find out the employees perception about these
parameters and thereby the overall @ob satisfaction level is measured#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Graph depicting the satisfaction level 7ith respect to (e*uneration0
Sa&i(fa!&i'n le+el -er!en&ae (1)
T' a +er* (mall e2&en& nil
T' a (mall e2&en& 34.3
T' a lare e2&en& 56.6
T' a +er* lare e2&en& 74
Graph 1
? 2!#21 of the employees are satisfied $ith the remuneration to a small extent#
? 50#01 of the employees are satisfied $ith their remuneration to a large extent
? !1 of the employees are very much satisfied $ith their remuneration#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Graph depicting satisfaction level regarding 1raining 8 %evelop*ent0
Sa&i(fa!&i'n le+el -er!en&ae (1)
T' a +er* (mall e2&en& 8
T' a (mall e2&en& 36.7
T' a lare e2&en& 75.9
T' a +er* lare e2&en& 7:.4
Graph 2
An Organisational Study on State Bank of India- Zonal Office, Bangalore
Graph depicting satisfaction level regarding Co**unication 7ith peers
and superiors0
Sa&i(fa!&i'n le+el -er!en&ae (1)
T' a +er* (mall e2&en& 7.5
T' a (mall e2&en& 39.9
T' a lare e2&en& 57.3
T' a +er* lare e2&en& 39.6
Graph @
? #51 of the employees feel very uncomfortable to communicate $ith their
peers and superiors#
? 2A#A1 of the employees are satisfied to a small extent $ith regard to
communication#
? 5#21 of the employees a satisfied to a large extent $ith regard to
communication#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
? 2A#01 of the employees to a very large extent are comfortable in
communicating $ith their superiors and peers#
Graph depicting ho7 clear are the e*plo+ees regarding goals of their
depart*ents and the organisation.
Satisfaction level percentage E1F
To a very small extent A#A
To a small extent !)
To a large extent (A#A
To a very large extent 2A#0
Graph A
? A#A1 of the employees are not very clear $ith their goals#
? !)1 of the employees are clear to a small extent $ith their goals#
An Organisational Study on State Bank of India- Zonal Office, Bangalore
? (A#A1 of the employees are clear $ith their goals to a large extent#
? 2A#01 of the employees do not have any confusion $ith regard to
their goals#
Graph sho7ing the e6tent of tea*7ork present bet7een the e*plo+ees
Sa&i(fa!&i'n le+el -er!en&ae (1)
T' a +er* (mall e2&en& 6.43
T' a (mall e2&en& 75.6:
T' a lare e2&en& ;7.