Page 18 - DMGT303_BANKING_AND_INSURANCE

Unit 1: Indian Banking System

1.5.11 Infrastructure Development Finance Co. (IDFC) Notes

It was set up in 1997 as a non-government company for financing infrastructure sector with
authorized capital of Rs. 5000 crores and initial capital based on Rs.1,600 crores-comprising of
Rs. 1000 crores as paid up capital and Rs. 600 crores as long term subordinated debt. Out of the
initial paid up capital of Rs. 1,000 crores, Rs. 600 crores have already been contributed by
domestic FIs and remaining Rs. 400 crores is to be received from overseas agencies.

1.5.12 Power Finance Corporation (PFC)

PFC was set up in July 1986 as a Financial Institution (FI) dedicated to power sector financing and
committed to the integrated development of the power and associated sectors. The Corporation
was notified as a Public Financial Institution in 1990 under Companies Act, 1956. The Corporation
was registered as a Non Banking Financial Company by RBI and was declared as Mini-Ratna
(Category-I) PSU by Govt. of India.
Power Finance Corporation of India is providing large range of financial products and services
like project term loan, lease financing, direct discounting of bills, short term loan etc. for various
power projects in generation, transmission, distribution sector as well as for renovation and
modernization of existing power projects.

Caselet Trading Services on the Internal Audit of Treasury
Operations

financial institution required assistance in enhancing the internal audit review
of its treasury operations. KPMG provided training services to the institution’s
Ainternal audit staff, covering the audit of both manual and IT controls, complex
structured products and valuation methodology, and leading practices in treasury processes.
Through a combination of training seminars, facilitated workshops, sample transaction
walkthroughs and experience sharing/briefing sessions, the institution’s internal audit
staff were able to improve their technical knowledge and enhance their auditing skills on
treasury operations.

Source: http://www.kpmg.com/CN/en/IssuesAndInsights/ArticlesPublications/Documents/
finance_treasury_mgt_0901.pdf

1.6 Summary

This chapter attempts to give an overview of the functions in as simple manner as possible.

Banks essentially perform the following functions:
(i) Accepting deposits from public/others (deposits)

(ii) Lending money to public (loans)
(iii) Transferring money from one place to another (remittances)
(iv) Acting as trustees e.g. keeping valuables in safe custody

(v) Government business.

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