▶▶DIFFERENCE BETWEEN UNIT BANKING & BRANCH BANKING◀◀ *********************************************** 1. Operational Freedom Branch Banking - Less operational freedom Unit Banking - More Operational freedom 2. Loans and advances Branch Banking - Loans and advances are based on merit, irrespective of the status Unit Banking - Loans and advances can be influenced by authority and power 3. Financial Resources Branch Banking - Larger financial resources in each branch. Unit Banking - Larger financial resources in one branch 4. Decision-making Branch Banking - Delay in Decision-making as they have to depend on the head office. Unit Banking - Time is saved as Decision-making is in the same branch. 5. Funds Branch Banking - Funds are transferred from one branch to another.Underutilisation of funds by a branch would lead to regional imbalances Unit Banking - Funds are allocated in one branch and no support of other branches.During financial crisis,unit bank has to close down.hence lead to regional imbalances or no balance growth 6. Cost of Supervision Branch Banking - High Unit Banking - Less 7. Concentration of power in the hand of few people Branch Banking - Yes Unit Banking - No 8. Specialisation Branch Banking - Division of labour is possible and hence specialisation possible Unit Banking - Specialisation not possible due to lack of trained staff and knowledge 9. Competition Branch Banking - High competition with the branches Unit Banking - Less competition within the bank 10. Profits Branch Banking - Shared by the bank with its branches Unit Banking - Used for the development of the bank 11. Specialised knowledge of the local borrowers Branch Banking - Not possible and hence bad debits are high Unit Banking - Possible and less risk of bad debts 12. Distribution of Capital Branch Banking - Proper distribution of capital and power. Unit Banking - No proper distribution of capital and power. 13. Rate of Interest Branch Banking - Rate of interest is uniformed and specified by the head office or based on instructions from RBI. Unit Banking - Rate of interest is not uniformed as the bank has own policies and rates. 14. Deposits and assets Branch Banking - Deposits and assets are diversified,scattered and hence risk is spread at various places. Unit Banking - Deposits and assets are not diversified and are at one place,hence risk is not spread. ********************************************** ▶DONT FORGET TO LIKE (Y) & SHARE US - IBPS Examination◀
Posted on: Tue, 04 Mar 2014 02:30:02 +0000
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