The current banking industry’s scenario is no different from a battlefield. While one side of the warriors is focused to retain their weapons (customers), the other side is trying to build a competitive advantage utilizing the opponent’s weakness (lower deposit rate). The general public has seen the current context of banking industry as a fight for survival. However, seeing things from different perspective, it actually resembles that all commercial banks will finally come to the same level given the similar range of paid up capital. The dominant market players in banking industry will be identified in the near future on the basis of net profit, deposit collection and loan portfolio.
The investors in secondary market are inquisitive on “which commercial banks will lead in the secondary market?” The precise answer to the stated question might not be pictured by all the investors instantly because nine of the commercial banks are yet to meet the paid up capital requirement. However, these nine commercial banks have already provided clues regarding their capital plan. Those banks that were sort of paid up capital have either used merger and acquisition approach or have utilized reserve fund to meet the paid up capital requirement. With the approaching deadline, banks are left with the alternatives of bonus share and right share to set the mark of Rs 8 arba in the first row of their balance sheets.
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