There is an overall improvement in the profitability situation in the recent years and also broad convergence of profitability across various bank groups. Since the mid-1990s, profitability levels of commercial banks has hovered in the range of 0.7-0.8 per cent, except during certain exceptional years. With the retail-banking sector expected to grow at a rate of 30%, players are focussing more and more on the Retail and are waking up to the potential of this sector of banking. At the same time, the sector is witnessing structural changes in regulatory frameworks and securitisation and stringent NPA norms means, the faster one adapts to these changing dynamics, the faster is one expected to gain the advantage.

The insurance sector in India has come a full circle from being an open competitive market to nationalization and than back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360 degree turn, which is witnessed over a period of almost two centuries.