BANKING THEORY – LAW AND PRACTICE

BBA 2.1
BANKING – THEORY – LAW AND PRACTICE

Evolution of Banks – Functions of Commercial Banks – Balance Sheet of Commercial Banks – Credit Creation, Organization and structure of Banks – Unit Banking and Mixed Banking – Public Sector and Private Sector Banks – Nationalization of Commercial Banks – Objects – Progress. Central Bank – Evolution – Functions – Credit Control Measures Money market – Indian money market – Components – Characteristics of developed and under developed money market. Banker and Customer – General and Special relationships – Negotiable instruments – Features – Types of accounts – Types of customers – Pass Book – Cheque – Features – Crossing – Endorsements Paying banker – Duties – Holder in due course – Payment in the due course – Protection – Collecting banker – Duties – Protection Text and Reference Books: 1. Basu : Theory and Practice of Development Banking 2. Muranjan S.K. : Modern Banking in India 3. Reddy & Appanniah : Banking Theory and Practice 4. Natarajan & Gordon : Banking Theory and Practice Lesson – 1 EVOLUTION OF BANKING Evolution of Banking Institutions
Origin of the word “Bank”. – Opinion is divided in regard to this. According to some authorities, the work “Bank” itself is derived from the words “bancus” or “banqee,” that is, a bench. The early bankers, the Jews in Lombardy, transacted their business on benches in the market place. When a banker failed his “banco” was broken up by the people, hence the word “bankrupt.” This etymology is however, ridiculed by Macleod on the ground Ages”. There are others, who are of the opinion that the word “bank” is originally derived from the German word “back” meaning a joint stock fund, which was Italianised into “banco” when the Germans were masters of a great part of Italy. This appears to be more