HR Practice in Cooprative Bank

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    A

    RESEARCH PROJECT REPORT

    ON

    H R P r a c t ic e in C o -o per at iv e B a nk

    DISSERTATION REPORT SUBMITTED IN

    PARTIAL FULFILLMENT FOR THE AWARD OF

    MASTER OF BUSINESS ADMINISTRATION

    (2012)

    F a c u l t y S up er vi s o r : S u b m i tt e d

    B y : MRS. RITU TIWARI KAVITA

    NEGI (Assistant Professor) MBA IVSEMDEPARTMENT OF ROLL NO: 14

    MANAGEMENT STUDIES

    AMRAPALI INSTITUTE OF MANAGEMENT & COMPUTERAPPLICATION(AFFILIATED TO UTTARAKHAND TECHNICAL UNIVERSITY, DHERADUN)

    SHIKSHA NAGAR, LAMACHAUR, HALDWANI

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    Kavita Negi, MBA- AIMCA

    ST UD E N T D E C L ARA TI ON

    This is to declare that project titled HR Practice in Co-

    operative Bank.

    The project was executed during the winter after the fourth semester of

    M.B.A. under the supervision ofMrs. Ritu Tiwari.

    Further, I declared that this project is my original work and the analysis and

    the findings are for academic purpose only. This project has not been

    presented in any seminar or submitted elsewhere for the award of any

    degree or diploma.

    KAVITA NEGI

    MBA V SEMROLL NO.:

    (i

    )

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    AC KN OWLE D GE M E N T

    Hard work and dedication is the key to any successful completion of any

    job and this project is no different. Although strenuous, yet it is interesting.

    However, our success to this project report cannot be accounted for by onlythese factors.

    During the course of this study, many useful suggestions and constructive

    criticism came across which really helped a lot in giving this project a

    professional look. I extend my heartiest thanks to all those persons whose

    willing cooperation led to the timely completion of the project.

    In completing this study, I did my level best correcting my

    shortcomings to possible extent and I sincerely hope that this report will

    serve its purpose for the Life Insurance Corporation of India.

    Although I am thankful to all those who have contributed towards the

    completion of this report. I would be failing in my duty if I do not

    mention the warm help extended to me by the Staff of Co-operative Bankfor providing me an opportunity to work in the esteem organization and

    without whose willing cooperation and encouragement the accomplishment

    of this project would have become impossible.

    Also I would like to thank all those who have helped me directly or

    indirectly in completing the present project.

    (ii

    )

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    Kavita Negi, MBA- AIMCA

    P R E F AC E

    "Banking Sector and Human Resources-Changing Scenario' presents a host

    of themes relevant for understanding the Indian experience in the period of

    economic reforms, when the country is fast becoming an integral part of

    globalization, and when international best practices and standard patterns

    are being adopted in a phased manner. The influence of economic reforms,

    and the phases in which specific measures have been adopted in a cautious

    way, making sure that social objective of service to the vulnerable sections

    and less developed regions is paid special attention, enable us to refer to this

    as human face of economic and financial sector reforms. Under the broad

    heads of banking and finance, and human resource management,

    specialists examine a number of specific topics. The critical look at

    progress in recent years, lessons learnt, and directions for the future are all

    spelt out on each topic based on the research endeavors of contributors.

    (iii

    )

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    Kavita Negi, MBA- AIMCA

    CON TE N T S

    Collage certificate

    Student Declaration i

    Acknowledgement iiPreface iii

    C H A P TER 1

    1 Introduction 1

    1.1 Purpose Of Research Work 2

    1.2 Chapter Arrangement 2-3

    1.3 Objectives of Study 4

    1.4 Period of Study 4

    1.5 Research Methodology 5

    1.6Scope of the Study 6

    1.7 Limitations of Study 7

    C H A P TER 2

    2.1 Industry Profile

    2.1.1 Banking Sector: 8-9

    2.1.2 Economic functions 10-11

    2.1.3 Origin of the word 11

    2.1.4 Banking channels 11-

    12

    2.1.5 Indian Banking Industry 13-

    14

    2.2 Profile of the Company

    2.2.1 The Co-operative Bank: Background 14-

    18

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    Kavita Negi, MBA- AIMCACCCCCCCCCCCCCCCCCC

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    2

    C H A P TER 3

    This part of project report contains

    summary of Findings.

    C H A P TER 4

    This part of the project report I finally concluded the project

    with some recommondation.

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    3

    OB JE C TI V E OF ST UDY :

    The objectives of my study are:

    To get an idea about HR function in banking industry with special

    reference to the cooperative sector

    To study and get knowledge about the development of

    Human Resource Management (HRM) in the Co-operative Bank

    like management strategy and employee relations in banking

    To get an idea about the possible relationship between uses of strategic

    human resource practices of cooperative banking firms.

    P E R I OD OF ST UD Y

    The project was executed during the fourth semester.

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    S C O P E OF S T UD Y :

    The aim of the study is to explore the possible relationship between uses of

    strategic human resource practices of banking firms. The study assumes

    that there is a link between the business strategy pursued by the firm and

    its human resource policies and practices. It is also assumed that there is a

    'fit' aspect (external and internal) between the business strategy and the

    human resources policies. The 'external fit', is the extent the human

    resource planning and implementation process is part of the strategy

    process in the bank organization. Data was collected using a structured

    questionnaire from firms representing banking sectors.

    The firms pursuing different business strategies have different degree of the

    'external- internal fit' of human resources. Also, firms pursuing different

    business strategies use different levels of strategic human resource

    practices.

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    LIMIT A TI ON S OF ST UD Y

    The researcher has to face certain difficulties while he carries out the

    research work. He knows the limitations before hand. Some of them are

    uncontrollable and some others are controllable. Some important

    limitations, which were faced, are as follows:

    1.Time was the major limiting factor during the research.it is quite

    impossible to collect the sufficient data.

    2. Limitation of funds: Availability of funds was another limitation

    owning to shortage of money..

    3.Limitation of human

    behaviors:

    4.Some of the respondent was not honest and genuine in their

    approach. Some of the respondents could not understand

    certain queries

    7

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    I nd us tr y P r of ile :

    B a nki ng Sect or :

    The definition of a bank varies from country to

    country.

    Under English law, a bank is defined as a person who carries on the

    business of banking, which is specified as:

    Conducting current accounts for his customers

    Paying cheques drawn on a him, and

    Collecting cheques for his customers.

    In most English common law jurisdictions there is a Bills of Exchange Act

    that codifies the law in relation to negotiable instruments, including

    cheques, and this Act contains a statutory definition of the term banker:banker includes a body of persons, whether incorporated or not, who carry

    on the business of banking' (Section 2, Interpretation). Although this

    definition seems circular, it is actually functional, because it ensures that

    the legal basis for bank transactions such as cheques do not depend on how

    the bank is organised or regulated.

    The business of banking is in many English common law countries not

    defined by statute but by common law, the definition above. In other

    English common law jurisdictions there are statutory definitions of the

    business of bankingorbanking business

    8

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    In particular, most of the definitions are from legislation that has the

    purposes of entry regulating and supervising banks rather than regulating

    the actual

    business of banking. However, in many cases the statutory definition

    closely mirrors the common law one. Examples of statutory definitions:

    "Banking business" means the business of receiving money on

    current or deposit account, paying and collecting cheques drawn by

    or paid in by customers, the making of advances to customers, and

    includes such other business as the Authority may prescribe for thepurposes of this Act; (Banking Act (Singapore), Section 2,

    Interpretation).

    "Banking business" means the business of either or both of the

    following:

    1. Receiving from the general public money on current, deposit,

    savings or other similar account repayable on demand or within less

    than [3 months] ... or with a period of call or notice of less than that

    period;

    2. Paying or collecting cheques drawn by or paid in by customers.

    Since the advent of EFTPOS (Electronic Funds Transfer at Point Of Sale),

    direct credit, direct debit and internet banking, the cheque has lost itsprimacy in most banking systems as a payment instrument. This has lead

    legal theorists to suggest that the cheque based definition should be

    broadened to include financial institutions that conduct current accounts

    for customers and enable customers to pay and be paid by third parties,

    even if they do not pay and collect cheques.

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    9

    Economic

    functions

    The economic functions of banks

    include:

    1. Issue of money, in the form of banknotes and current accounts

    subject to cheque or payment at the customer's order. These claims

    on banks can act as money because they are negotiable and/or

    repayable on demand, and hence valued at par and effectively

    transferable by mere delivery in the case of banknotes, or by drawing

    a cheque, delivering it to the payee to bank or cash.

    2. Netting and settlement of payments -- banks act both as

    collection agent and paying agents for customers, and participate in

    inter-bank clearing and settlement systems to collect, present, be

    presented with, and pay payment instruments. This

    enables banks to economise on reserves held for settlement of

    payments, since inward and outward payments offset each other. It

    also enables payment flows between geographical areas to offset,

    reducing the cost of settling payments between geographical areas.

    3. Credit intermediation -- banks borrow and lend back-to-back on

    their own account as middle men

    4. credit quality improvement -- banks lend money to ordinary

    commercial and personal borrowers (ordinary credit quality), but are

    high quality borrowers.

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    10

    5. Maturity transformation -- banks borrow more on demand debt

    and short term debt, but provide more long term loans. Bank can

    do this because they can aggregate issues (e.g. accepting deposits

    and issuing banknotes) and redemptions (e.g. withdrawals and

    redemptions of banknotes), maintain reserves of cash, invest in

    marketable securities that can be readily converted to cash if needed,

    and raise replacement funding as needed from various sources (e.g.

    wholesale cash markets and securities markets) because they have a

    high and more well known credit quality than most other borrowers.

    Origin of the word

    The name bank derives from the Italian word banco "desk/bench", used

    during the Renaissance by Florentines bankers, who used to make their

    transactions above a desk covered by a green tablecloth. However, there are

    traces of banking activity even in ancient times.

    In fact, the word traces its origins back to the Ancient Roman Empire,

    where moneylenders would set up their stalls in the middle of

    enclosed courtyards called macella on a long bench called a bancu, from

    which the words banco and bank are derived. As a moneychanger, the

    merchant at the bancu did not so much invest money as merely convert the

    foreign currency into the only legal tender in Rome- that of the Imperial

    Mint.

    Banking

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    channels

    Banks offer many different channels to access their banking and

    other services:

    11

    A branch, banking centre or financial centre is a retail location

    where a bank or financial institution offers a wide array of face-to-

    face service to its customers

    ATM is a computerised telecommunications device that provides

    a financial institution's customers a method of financial transactions

    in a public space without the need for a human clerk or bank teller.

    Most banks now have more ATMs than branches, and ATMs are

    providing a wider range of services to a wider range of users. For

    example in Hong Kong, most ATMs enable anyone to deposit cash

    to any customer of the bank's account by feeding in the notes and

    entering the account number to be credited. Also, most ATMs

    enable card holders from other banks to get their account balance and

    withdraw cash, even if the card is issued by a foreign bank.

    Mail is part of the postal system which itself is a system

    wherein written documents typically enclosed in envelopes, and also

    small packages containing other matter, are delivered to destinations

    around the world. This can be used to deposit cheques and to send

    orders to the bank to pay money to third parties. Banks also

    normally use mail to deliver periodic account statements to

    customers.

    Telephone banking is a service provided by a financial institution

    which allows its customers to perform transactions over the

    telephone. This normally includes bill payments for bills from major

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    billers

    Online banking is a term used for performing transactions, payments

    etc. over the

    Internet through a bank, credit union or building society's secure

    website

    12

    Indian Banking Industry

    The growth in the Indian Banking Industry has been more qualitative than

    quantitative and it is expected to remain the same in the coming years.

    Based on the projections made in the "India Vision 2020" prepared by the

    Planning Commission and the Draft 10th Plan, the report forecasts that thepace of expansion in the balance-sheets of banks is likely to decelerate. The

    total assets of all scheduled commercial banks by end-March 2010 is

    estimated at Rs 40,90,000 crores. That will comprise about 65 per cent of

    GDP at current market prices as compared to 67 per cent in 2002-03. Bank

    assets are expected to grow at a...