Management of Financial Institutions: An Inquiry into the Extent of Professionalism in IDBI, IFCI and ICICI

The purpose of this study was to assess the degree of professionalism in three all-India level DFIs -–IDBI, IFCI and ICICI. It was also intended to derive implications for developing policies and procedures for managing development banks in general. On the basis of experiences of all-India DFIs, the model that seems to facilitate professionalism is one in which sophisticated policies, procedures and systems exist for identification, appraisal, approval, disbursement and follow-up of projects, and in which financial and technical experts combine to form teams for performing appraisal and follow-up of projects. It is also indicated that projects should be meticulously examined with the active involvement of the applicants. With the age and size of all-India DFIs, their functions have led their staff to grow, and they have created more specialised departmental structures. Thus, it may be concluded that over years DFI’s structure becomes more departmentalised. Training is an integral part of the development process. All-India DFIs have sophisticated systems for the training of their staff. Also, need for finances from DFIs increases substantially. This necessitates development of skills to collect savings. All India DFIs in this respect are quite behind. They have not been so far able to establish an organic link to the sources of finances.