Corporate governance in banks

Abstract

Any contemporary economy depends on the banking industry to function. It is one of the most crucial foundations of the financial sector, which is essential to an economy's smooth operation. Additionally, addressing an economy's financial needs for trade, industry, and agriculture with a higher level of dedication and accountability is essential for its economic growth. As a result, the growth of banking is closely related to the development of a nation. In a modern economy, banks should be viewed as growth drivers rather than money merchants. They are crucial in mobilizing deposits and the distribution of loans to different economic sectors and industries. Hence the country's financial situation is reflected in the banking system. A sound and solvent banking system is a prerequisite for a robust financial system, which depends on a strong economy. Savings can be effectively mobilized in sectors by a sound banking system. A solvent banking system assures the bank can fulfill its responsibility to the depositors and other stakeholders. In this way, the financial sector can maintain the balance and stability of the appropriate allocation of money. In a country like India following independence, banks have been instrumental in the nation's socio-economic development. Therefore, the banking industry in our country holds the utmost importance in the functioning of the economy.