Banking System of India

In India Banking System is the most important segment of the financial Sector. For over 80% of funds are through financial sector. The Government set up two committiees on financial system to examine all the aspects which relates to the structure and procedure of the financial system.The responsibilities of the committees is to manage demands that would comes by the economic reforms and to introduce greater competition through private sector participation. As well as the financial system of India is functionally very strong.So the system comprises of financial instruments,financial services and financial markets.The activities of financial institutions is classified into banking and non banking.The Reserve Bank of India(RBI)which is the regulatory authority of credit in providing finance to economy.The important banking institutons are the commercial banks(in public and private sector)regional rural banks,cooperative banks and development banks.Non banking financial institutions include finance,leasing companies and some other institutions,mutual funds,provident funds etc.In India banking starts from eighteenth century.Mostly the banks was to be found by the entrepreneurs and visionaries from the pre-independence to give financial support to traders, farmers and entrepreneurs. The First Bank was The General Bank of India started, and the Bank of Hindustan. In Calcutta the Indian merchants recognized The Union Bank but due to some economic crisis it failed. Then The Allahabad Bank was recognized which is functioning today also and that bank is one of the oldest Joint Stock bank.When American civil war was stopped the cotton supply promotes banks to finance through trading in cotton.With large exposure, most of the banks open in India during that period

failed. The depositors, lost money and interest in keeping money in the banks. The first Indian joint stock bank was The Oudh Commercial Bank in Faizabad but it also failed.The next was The Punjab National Bank in Lahore,which also survived in present and now it is one of the largest bank of India. The Banks perform many functions for their customers such as it acts as an agent by collecting payments conducting checking or provides facilities on current accouts .The paying checks drawn by their customers,and collecting the cheques deposited to the customers in their current accounts.Banks also facilitate by customer payments or other payments.For this purpose the methods which are used by telegraphic transfers and ATM.The Banks borrow money by receiving deposits in current accounts,term deposits and the banks also issues debt securities such as banknotes and bonds.The banks lends money to their customers on their current accounts by making installments loans and also investing in marketable debt securities and some other ways of lending money. The banks also facilitate to their customers by providing all payment services and it borrows funds from non-financial businesses and households and it also lend funds to the households and non financial institutions. Banks propose many mortgage facilities with low interest rates on loans. The home loans for fulfilling housing needs, the personal loans, and the auto loans for private and commercial vehicles, student loans for the attainment of their educational needs , corporate lending to businesses and for other different types of Projects and loans beside property and on other assets. The money which is deposited is in safe and sound hands and provides growth forecasting for their customers.In India the banks are to be

classified as public sector banks, private banks and foreign banks. The Public sector banks are those banks which are backed by Indian Government, thats why the money of the depositors is quite safe. These are some of the very oldest banks in India and have rational charges for the services.Some of the branches of these banks are not networked, but they gradually starting the internet banking,and some other facilities like ATM cards. Mostly, the IT needs are not properly predictable and thats why it results in creating many problems and difficulties for the customers.But they provides much better service as compared to the all other types of banks.And the Private banks were also recognized . They had influenced best use of the technology and also provides ATM, internet and phone banking.And you can also use your account from any branch in India .The Private and foreign banks cover up sixty five percent of the forex transactions in India.But, before depositing your large amounts of money in these banks, it is very much suitable and important to verify the financial position of the bank.In India some of the foreign banks are in service like the Standard Chartered bank. Though, they had limited number of branches, generally in the main financial district of main cities.However, in India seventeen banks are certified to import gold from outside country and then resell it to the jewellers, the exporters and to the retail customers. Types of Bank. The commercial banking includes scheduled banks and the regular commercial banks. Scheduled commercial banks are those banks which has been integrated in the second schedule of the reserve bank, while public or private, commercial or government or private there are different types of banks, each managing its own particular

tasks. There is variety of banks, and each has its definite part to play and as well as a particular field to do in which they manage its activities. But generally speaking the banks may be categorized into numerous groups on the basis of activities. For example the investment banks, the retail banks, the business banks and the corporate banks. The Retail banks are those banks which are directly linked with consumers and also with small business holders. Their focal point depends upon collecting market products such as current and savings accounts, mortgages loans, some other loans and credit cards.The Retail banks are further divided into different types of banks such as these are the following which exists in India. The Business banks are those banks which provide services to the businesses and other organizations that are not of large scale only to those which are medium scale. The Corporate banks provide their services to those clients who are generally major business units. And The Investment banks provides their services associated to financial markets such as mergers.The Offshore banks are those private banks which operate in the globe of cheap taxes.The Community banks are those banks works on a local source and provide people and markets that have been generally free from banking services.The Postol Savings banks are those banks which works in association with the nations National postal systems. The Ethical banks are those banks they only recognize investments that are socially and environmentally beneficial. As well as the activities of banks are concerned the banks also provides finance to major industries. In India the major industry is Food and Beverage Industry and some other industries are Textiles, Chemicals, Food Processing, Steel and Cement

industry.The Central bank which is the supreme authority is also called Reserve Bank of India. These are following nationalized Banks in India .Allah bad Bank, Andhra Bank, Bank of Baroda, Bank of India, Bank of Maharashra, Canara Bank, Central Bank of India, Corporation Bank, Dena Bank, IDBI Bank, Indian Bank, Indian Overseas Bank, Oriental Bank of Commerce, Punjab National Bank, Punjab & Sindh Bank, syndicate bank, UCO Bank, United Bank of India, Vijaya Bank. These are the SBI & associates Banks in India State Bank of Hyderabad, State Bank of Bikaner & Jaipur, State Bank of Mysore, State Bank of Patiala, State Bank of Travancore, State Bank of Indore, State Bank of Saurashtra. These are the following Private Banks in India. Axis Bank, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, ING Vysya Bank, South Indian Bank, Bank of Rajasthan, Karnataka Bank, Dhanalakshmi Bank, City Union Bank, Jammu & Kashmir Bank, Karur Vysya Bank, Saraswat Bank, Federal Bank, Indus land Bank, Tamilnad Mercantile Bank. These are the following foreign banks. The Banks with branches in India.ABN AMRO Bank N.V. - Royal Bank of Scotland, Abu Dhabi Commercial Bank Ltd, American Express Bank, Antwerp Diamond Bank, Arab Bangladesh Bank, Bank International Indonesia, Bank of America, Bank of Bahrain & Kuwait, Bank of Ceylon, Bank of Nova Scotia, Bank of Tokyo Mitsubishi UFJ, Barclays Bank, BNP Paribas, Ceylon Bank, China Trust Commercial Bank, Citibank, DBS Bank, Deutsche Bank, HSBC , JPMorgan Chase Bank, Krung Thai Bank, Mashers Bank, Mizuho Corporate Bank, Oman International Bank, Shinhan Bank, Societe Generale, Sonali Bank, Standard Chartered Bank, State Bank of Mauritius. The central bank is the Reserve Bank of India (RBI).The Reserve Bank of India was nationalised

in 1949. The Bank was formed for the fulfillment of the following needs.Firstly, to regulate the issue of banknotes in the country. Secondly, to maintain reserves and the monetary stability within the country and last but not the least to operate the credit and currency system of the country.Because, the first most important function of Central Bank has its sole right to issue the bank notes. The allocation of one rupee notes and coins and small coins all over the country is carryout by the Reserve Bank as the Government agent.And The Reserve Bank has a separate Issue Department which is to be delegated in issue of currency notes. The Issue Department assets and liabilities are reserved separate from the Banking Department.Formally, the assets of the Issue Department consists of the gold coin or the sterling securities granted the amount of gold. The left behind three fifths of the assets may be in rupee coins, Government of India rupee securities, eligible bills of exchange and promissory notes payable only in India. The second another important function of the Reserve Bank of India is to operate as the bank of Government, agent and the adviser. The Reserve Bank is the agent of Central Government and of all State Governments in India. The Reserve Bank has the responsibility to handle Government business to carry on the cash balances as the deposits which are free of interest, to receive and make payments on the behalf of Government and to carry out their exchange payments and other banking functions. The Reserve Bank makes possible for the Government the Union and for the States to advise about new loans and to handle public debts. The Bank also makes ways and proceeds advances to the Governments. It formulates the loans and advances to the States and also for local authorities. It works as an advisory authority to the Government on

all the monetary and all the banking matters. The Reserve Bank of India works as the bank of their listed and scheduled banks. According to the provisions of the Banking Companies, all scheduled bank are required to retain with the Reserve Bank a cash balance which is equals to five percent of the demand liabilities and two percent of its time liabilities which is not outside the country only in India. The dissimilarity between the demand and the time liabilities was eliminated and the banks have been inquired to keep cash reserves equal to the total deposits of the liabilities. The minimum requirements of cash can be changed by the Reserve Bank of India.The scheduled banks can take money from the Reserve Bank of India on the base of adequate securities Or to get financial adjustments in the times of requirements or severity by rediscounting the bills of exchange.While commercial banks can forever expect from the Reserve Bank of India to come up for their help in times of banking calamities and disasters and the Reserve Bank becomes not only provides the above facilities but it is also the lender of last resort for the banks.The Reserve Bank of India is the controller of credit so it has the power to control the capacity of credit created by the banks. It can makes it possible by shifting the Bank rate or by the operations of the open market.The Reserve Bank of India can ask over any bank or the entire banking system not to lend to particular groups or persons on certain types of securities.While, carefully by the controls on credit it is gradually used by the Reserve Bank of India.The Reserve Bank is supported with much more powers to manage money markets in India. And every bank is to be authorized from the Reserve Bank of India to do the banking business in India.For that purpose the licensed are given by the banks and this license

can be cancelled by the Reserve Bank by certain situations if the conditions are not satisfied.So it is necessary that all scheduled banks will have to get the consent of the Reserve Bank before opening a new branch in the country and also send a weekly return to the Reserve Bank showing all the details and all its assets and all the liabilities. The Reserve Bank of India also has the authority to verify all the accounts of the commercial bank which are under his control.As a highest banking authority in the country the Reserve Bank thus has the subsequent authorities.It possess the cash reserves of all listed banks.It also controls the credit functioning of all the banks through quantitative as well as qualitative controls.It also provides the rediscount facilities to scheduled banks as a lender of last resort.It is the duty of Reserve bank of India to retain the official exchange rate.It is necessary for the Reserve bank to buy and sell securities at a fixed rates at any authentic amount.India become a member of the International Monetary Fund the Reserve Bank has the duty to uphold the fixed exchange rates with all the other member countries of I.M.F.Moreover uphold the exchange rate of rupee.The Reserve Bank has to perform the function of custodian of India's reserve of the International currencies. The infinite authentic balances were attained and supervised by Bank.The RBI also has the duty of managing the exchange controls of country. Besides all this its conventional central banking tasks.The Reserve bank has definite non-monetary tasks like regulating and controlling the banks and the encouragement of good system banking in India.The Reserve Bank of Indias broad powers of managing or the control on the commercial and also on the co-operative banks but those are connecting to licensing,establishments,branch expansion, liquidity

of their assets the management and their working methods, amalgamation, reconstruction or as well as liquidation. The RBI is approved to complete periodical check up of banks and to call for the returns and it is compulsory information from them. The nationalisation of Indian scheduled banks has imposed new duties on the Reserve Bank for expressing the growth of banking and credit policies on the way of very speedy development of the economy and recognition of definite or preferred social needs. The managerial functions of the Reserve Bank had to help in great arrangement in improving the banking standard in India to improve the methods of the operations.With the economic growth expansion a new importance while Independence the choices of the Functions of the Reserve Banks have gradually extended. Now the Bank carries out a range of developmental as well as promotional Functions. But which at one time were considered as the outside the normal capacity of the central banking. The Reserve Bank was asked to encourage banking practices, expand the banking services to the rural and semi-urban areas and also create and encourage particular new agencies of financing.Therefore; the Reserve Bank has helped in creating the IFCI and the SFC. It also arranged the Deposit Insurance Corporation.These institutions were arranged directly or indirectly by the Reserve Bank to encourage saving Habit and to assemble savings and to provide industrial finance and also provides agricultural finance. As far back the Reserve Bank of India arranged the Agricultural Credit Department to give the agricultural credit. But only since the role of the banks in that field had became very much important. The Bank has developed the co-operative credit association to promote savings and to eliminate the money lenders from villages and towards its short

term credit to the agriculture. The Reserve Bank of India has arranged the Agricultural Refinance and Development Corporation to facilitate the long-term finance to the farmers.The monetary functions which are also known as the central banking functions of the Reserve Bank of India are associated to control and to regulate the money and the credit such as the issue of currency the control of bank credit the control of foreign exchange operations the banker to the Government and also to the money markets.The Monetary functions of the Reserve Bank are important as they have to control and to regulate the volume of the money and credit in the country.Another most important thing though are the nonmonetary functions of the Reserve Bank in the viewpoint of India's economic backwardness. The important managerial function of the Reserve Bank may be observed as a non-monetary function. The promotion of a good banking in India is an important aim of the Reseve Bank of India.The Reserve Bank of India has been given broad and strong powers.These powers are related to the licensing Of the banks their expansion of branches the liquidity of their assets their supervision and their working methods their inspection their amalgamation their reconstruction and their liquidation.Under the management and check up of Reserve bank of India, the working of banks has greatly improved. The Commercial banks had developed into financially and operationally strong and feasible units.The Reserve banks powers of managing had been extended to non-banking financial mediators.Since independence, particularly after its nationalization the Reserve Bank of India has followed the promotional functions strongly and had been liable for powerful financial sustainability to industrial development and agricultural development in the country. India attempts to highlight

key trends of the 77 Scheduled Commercial Banks (Scbs) profiled in the publication. The SCBs comprises of 27 Public Sector Banks (PSBs), 22 Private Sector Banks and 28 Foreign Banks. For the purpose of the study we considered all 77 SCBs profiled in the publication. The various parameters such as income growth and composition, business growth, asset quality and market risk gaining insights on the profiled banks. The total Assets of 77 SCBs rose by more than double to Rs 43,264.9 bn during FY08, as compared to the asset base of Rs 19740.2 bn in FY04. During FY08, the total asset base of the SCBs was equivalent to 91.8% of Indias GDP, as compared to 62.7% of GDP in FY04.Public Sector Banks (PSBs) dominate the banking industry with a contribution of close to 69.9% to total assets, followed by private sector banks which account for around 21.7% of total assets. Furthermore, based on the banks balance sheet size (total assets), the banks are classified as large sized banks, medium sized banks and small sized banks using the 80:15:5 principles. The large sized banks are defined as banks with a balance sheet size of more than Rs 600 bn, medium sized from Rs 200 bn to Rs 600 bn and small sized banks are banks with a balance sheet of up to Rs 200 bn.The principle there are 22 large sized banks with a balance sheet size of more than Rs 600 bn together accounting for close to 80% of the total assets of SCBs? These comprise of 16 PSBs, 3 private sector banks and 3 foreign banks. The 18 medium sized banks account for the next 15% of the total assets, and include 11 PSBs, 5 private sector banks and 2 foreign banks. The small size banks at the lower end of the spectrum account for 5% of the total assets and include 37 banks comprising of 23 foreign banks and 14 private sector banks. Over the last five years, the growth spurt and rapid expansion of

the Indian economy coupled with rising income levels and ever increasing hunger for credit led to a record surge in the deposits and advances during the last five years. The Credit Deposit ratio, advances given to customers as a percentage of deposits, rose to 74.6% in FY08 as compared to 54.8% in FY04. Deposits for all SCBs in FY08 were higher by Rs 6,232 bn compared to FY07, at Rs 33,201 bn; whereas advances were higher by Rs 4958 bn compared to FY07, at Rs 24,770 bn. The booming economy led to a spurt in credit demand in industries, retail loan segment and other consumer finance segments. The private sector banks have outperformed the PSBs as well as the foreign banks with deposits growing at a CAGR of 26% during FY04 FY08, and the advances growing at a CAGR of 32% for the same period. The PSBs have outperformed their foreign peers in credit growth despite their high base.After years of continuous robust credit growth; FY08 witnessed a slight moderation in credit growth as compared to the previous years, as a result of the monetary policy tightening measures initiated by the RBI to contain inflation during the year. Prior to FY08, RBI raised CRR four times at regular intervals by 25 basis points each time between Dec23, 2006 and Mar 3, 2007 (both days inclusive) in order to control excess liquidity and mounting inflation. In addition, at the onset of FY08 the RBI further tightened its monetary stance by raising CRR twice in Q1 FY08 (Apr 14 and Apr 28) by a total of 50 basis points from 6% to 6.5%. This hike in CRR pushed interest rates upwards, and subsequently resulting in many banks raising their PLRs. The consequent hikes in interest rates resulted in a decline of 55 basis points in q-o-q incremental credit growth in Q1 FY08. However, credit growth picked up yet again in the forthcoming quarters and

in fact remained robust during FY09 despite rising concerns of a slowdown. The robust credit growth during FY09 despite a slowing economy can be attributed to the drying up of alternative sources of funding like equity markets, ECBs, FCCBs, etc. The CASA (Current Account Saving Account) deposits are low cost deposits that are key to banks survival and profitability during a period of higher interest rates and interest rate volatility that is prevalent today. The low cost deposits help banks maintain the spread between the cost of funds and interest earned in a period of high interest rates, thus protecting their margin. For the purpose of analyzing the market share of low cost deposits and its relation to net interest margin, we have compared the bank groups amongst themselves. Amongst foreign banks, the share of demand deposits and savings bank deposits rose to 44.7% of the banks total deposits in FY08 as compared to a 33.8% share of low cost deposits in FY03; and amongst private banks the share of low cost deposits increased to 32.8% from a share of 23.8% of total deposits. The ratio of net interest income to total assets increased to 3.8% and 2.4% in 2008 for foreign banks and private banks respectively. However, for PSBs there is a slight decline in share of low cost deposits and a drop of 75 basis points in the ratio of net interest income to total assets. The total income of the SCBs doubled to Rs 3,688.9 bn in FY08 as compared to an income of Rs 1,838.7 bn in FY04. The PSBs continue to dominate the Indian banking industry, accounting for more than 66% share in total income; followed by 23.86% share of private sector banks. The total income of these banks comprises of interest income and non interest income. The interest income is the interest earned on loans and advances besides income from investments; whereas the non interest income

includes fee based income, income from treasury operations, gain/loss on sale or revaluation of investments, gain/loss on sale of banking and non-banking assets to name some. Accelerated economic growth in India over the last few years, coupled with heightened industrial activity and the subsequent robust credit growth lifted interest incomes, a major constituent of the banks total income, by a level of 21% CAGR during FY04 FY08. Although the PSBs have the lions share of the total interest income earned by banks, PSBs have been consistently losing out to private sector banks and foreign banks in the last three years. However, the pace of decline in the share of PSBs in the total interest income earned by the SCBs has decelerated in FY08. During FY08, the share of the PSBs in the total interest income earned by SCBs declined by just 173 basis points as compared to the 350 basis points decline in FY07.The share of non interest income per se in total income has declined since 2004. However, fee based income, a constituent of non interest income, has increased - sharply outperforming the growth from other segments of income including the interest income. Fee based income has created an additional revenue stream for banks and has thus become an increased focus area for most banks. The boom in the economy has led to richer opportunities in public markets, investment banking, M&A deals, etc; and more banks have ventured into these areas or have strengthened their presence in these activities to augment their revenue, and capitalize on the boom. The share of fee based income increased from just 29.9% of the non interest income in FY04 to over 52% during FY08. In terms of the income share from fee based income, the PSBs have lost share to their private sector and foreign peers in all four years,

and have a much lesser share of fee income, as compared to their dominance in interest income. The consolidated fee based income for SCBs outstripped growth in interest income by growing at a CAGR of 27% during FY04 FY08. For private sector banks, fee based income grew at a CAGR of 45% for the same period, outperforming its foreign and public sector peers, whose fee based income grew at a CAGR of 35% and 18% respectively. In 2008, fee based income accounted for close to 12% of the total income of private sector bank; over 15% share in total income of foreign banks and just 6% of the total income of PSBs.In accordance to RBI guidelines for SCBs on AS 17 (Segment Reporting) dated Apr 18, 2007; and effective Mar 31, 2008 the segment wise revenue of the banks are reported under retail banking, corporate/wholesale banking, treasury, and other banking operations. Other banking operations may include hire purchase and leasing operations, gain/loss on sale of banking and nonbanking assets and other items not attributable to the other three segments. Retail banking is a high volume business which constitutes a majority of the total revenue for both public and private sector banks. When compared to the private sector, PSBs which are perceived to be risk averse, have higher exposure to the retail banking segment, and lesser exposure to treasury operations. Among the PSBs, SBI alone accounts for more than one fourth of the income pie from retail banking operations. In fact, out of SBIs total revenue close to half is contributed from its retail banking operations. The higher share of the PSBs in retail banking can be attributed to their unmatched rural reach which keeps them far ahead of their private sector and foreign peers in terms of their presence in rural areas. The PSBs account for 94.7% of the total

branches in rural area. Of the total 28 foreign banks; segment wise revenue was unavailable for six foreign banks due to non availability of their annual reports. On an aggregate level, for the 22 banks for which segment wise revenue was available, treasury operations ruled their top line with a contribution of 34% to the segment revenue, followed by a 31% contribution by retail banking operations and a 28% contribution by corporate banking operations. Within 22 banks, only 12 banks had exposure to retail banking. These 12 banks show that retail banking operations form a major chunk accounting for 36% of their revenue; followed by treasury operations and corporate banking. The 10 foreign banks that did not have any exposure to retail banking had a majority of their revenue from either corporate banking or treasury operations. Unlike their public sector and private sector peers, almost all the foreign banks are very active in treasury operations in India. Quality of bank asset has visibly improved for SCBs during the economic boom with standard assets consistently rising upwards, and moving from 97.3% in FY07 to 97.6% in FY08. Standard assets for all SCBs in FY08 stood at 22,758.4 bn and were higher by Rs 4,326.2 bn when compared to FY07. However, concerns on asset quality have emerged which reflects in movement of NPAs. Between FY07 and FY08, the ratio of addition to NPAs as a percentage of Gross NPAs has increased, while on the other hand recovery of NPAs as a per cent of Gross NPAs has declined. Further, the rise in total loan assets restructured reinforces the concern on asset quality.The start of FY08 was marked with a period of high interest rate regime in order to control the excess liquidity and control inflation. Furthermore, to make matters worse, the down phase in the business cycle in recent months has raised

the odds of credit default. The aggressive credit growth seen in recent years is now followed by a widespread slowdown in the economy. Concerns on the macro could mean that asset quality would be under scrutiny going forward. The asset quality of the PSBs has improved with a decline reported in sub standard, doubtful and loss assets as compared to their private sector and foreign peers. Private sector banks on the other hand have reported a sharp increase in sub-standard assets over the last couple of years. In FY08, the proportion of standard assets for private sector banks has declined by 34 basis points to 97.3% as compared to FY07. The total loan assets restructured can be effective in avoiding delinquencies to a certain extent, but it also results in an understatement of asset quality. During FY08, there was an increase in structuring of loans, both corporate as well as noncorporate debt. In FY08, the total amount of loans restructured went up by 61% for the PSBs; and more than doubled for the private sector banks and foreign banks. The total amount of loans restructured by foreign banks was at Rs 1,623.2 mn in FY08, as compared to Rs 578.8 mn in FY07.Off-Balance Sheet Exposure also known as Contingent liabilities, include exposure to derivative contracts, letters of credit and guarantees, are not directly funded by banks and do not appear on their balance sheets. In FY08, the off-balance sheet exposure of SCBs increased sharply by 88.4 per cent, the sharpest rise in recent years, while the exposure to forward exchange contracts, a constituent of off balance sheet exposure rose by 94.6%. The exposure to forward exchange contracts contributes to more than half of the off-balance sheet exposure for the PSBs, private sector banks as well as foreign banks. In fact during FY08, the foreign exchange contracts for

foreign banks were higher by Rs 43,608 bn as compared to FY07, at Rs 85,823 bn; contributing to around 84% of the off-balance sheet exposure of foreign banks displays the aggressiveness of foreign banks in the foreign exchange business. Rising fluctuations in the currency market has led to many banks entering into simple as well as exotic forward contracts to hedge against any currency fluctuations. Unlike their lending business, banks are not required to bring in additional capital to scale up their derivative business. The business of lending of banks is curtailed by the amount of capital on the books of this banks.PSBs which are perceived to have low risk appetite and conservative followers of banking norms, have the lowest ratio of off-balance sheet exposure to total assets at 61%, as compared their peers. However, their exposure to derivative contracts has increased over a period of time. This ratio compares the risk or the liability that may arise, to the balance sheet size of banks. As at the end of FY08, private sector banks had an off-balance sheet exposure to total assets ratio of 251%, and foreign banks have the highest off-balance sheet exposure to total assets ratio of 2803%. In FY08, the increase in absolute value of off-balance exposure was highest for foreign banks at 102% despite their higher base.